SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                               ------------------
                                   FORM 10-KSB
                   ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF
                       THE SECURITIES EXCHANGE ACT OF 1934




                     For the Fiscal Year Ended June 30, 2001
                              ---------------------
                          Commission File No. 000-28371


                               Endovasc Ltd., Inc.
                 (Name of Small Business Issuer in Its Charter)




                    Nevada                                  76-0512500
         ----------------------------------------------------------------
         (State  or  Other  Jurisdiction  of                 (I.R.S.  Employer
         Incorporation  or  Organization)              Identification  Number)




              15001  Walden  Road  Suite  108  Montgomery,  Texas  77356
       -----------------------------------------------------  ------------
               (Address  of  principal  executive  offices)  (Zip  Code)

                                 (936)  448-2222
                                 --------------
                (Issuer's  Telephone  Number,  Including  Area  Code)

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

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

                    Common  Stock,  Par  Value  $0.001  Per  Share

     Check whether the Issuer: (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Securities  Exchange Act of 1934 during the preceding
12 months (or for such shorter  period that the  registrant was required to file
such reports), and (2) has been subject to such filing requirements for the past
90  days:

Yes  [x]  No  []

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

     The  Company's  revenues  for  its  most  recent  fiscal  year  were  $75M.

     The  aggregate  market  value of the voting stock held by non-affiliates of
the  Company  was  $1,881,951 as of September 25, 2001, based on the average bid
and  asked  price  of  $0.04  per  share  as  of  that  date.


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     There  were 58,811,798 shares of Common Stock, $.001 par value, outstanding
as  of  September  25, 2001.  Additionally, there were 12,255 shares of Series A
Convertible  Preferred  Stock,  $.001  par  value  per  share, outstanding as of
September  25,  2001.

                                     PART  I


Item  1.           DESCRIPTION  OF  BUSINESS.

History

     We  incorporated as a biopharmaceutical company under the laws of the state
of  Nevada  on  June  10,  1996, under the name Endovasc, Inc.  Upon our initial
incorporation,  we  were  authorized  to  issue an aggregate of 25,000 shares of
capital  stock  with  a par value of $0.001 per share.  On September 5, 1996, we
amended  our  articles  of  incorporation  to  increase our authorized shares to
100,000,000  shares  of  common  stock,  par value $0.001 per share.  On May 28,
1997,  we  amended  our articles of incorporation to change our name to Endovasc
Ltd.,  Inc.  On  June  2,  1997,  we  amended  our  articles of incorporation to
authorize  a  total of 120,000,000 shares of capital stock, par value $0.001 per
share,  of  which 100,000,000 shares are common shares and 20,000,000 shares are
preferred  shares.

     On  or  about  October 8, 1999, we received preclinical approval to file an
Investigational  New Drug  application for Phase I and II clinical trials of our
Liprostin  technology.  On or about February 25, 1999, we obtained the exclusive
licensing  rights  to  Nicotine  Receptor  Agonist  ("NRA")  technology from the
University  of  Stanford,  in  exchange  for  stock  and cash. We have commenced
preclinical  trials  on  the  safety and  efficacy  of NRA in  conjunction  with
Stanford  University  and  Columbia  University.

     The Company has not been subject to bankruptcy, receivership or any similar
proceeding.


Overview

     We  develop,  market  and  license biopharmaceutical products, particularly
liposomal  drug delivery methods, for the human healthcare industry.  We develop
liposomes,  which  are microscopic cell-like spheres composed of a thin, durable
lipid  membrane  surrounding a hollow compartment.  Liposomes entrap and protect
drugs from degradation in the blood stream and can be engineered to regulate the
transport  of  molecules across their outer membrane.  Using this technology, we
are  developing products that deliver drugs to their intended target and release
them  with  efficiency  and  control.

     Currently,  our  product  development  is  focused on three product lines--
Liprostin,  Nicotine  Receptor  Agonist,  and  stent  coating.  Although we hold
patents and patents pending for products in the process of clinical testing, our
products  have  not  been approved for general sales.  Consequently, we have not
generated  any revenues from the sale of products and have historically operated
with  significant  losses.  Although  our  current  development efforts focus on
vascular (heart and lung) applications of our products, we intend to develop our
technologies  for  use  in many medical treatment applications.  We believe that
our  unique  and  highly  adaptable  technologies  will  put our products at the
forefront  of  the  multi-billion  dollar  drug  market.

     Liprostin  Technology

     Our  Liprostin  products  provide targeted delivery of Prostaglandin E-1 to
blood vessels in connection with angioplasty procedures. Angioplasty is a common
medical  procedure  that  utilizes  a small balloon-like structure to expand and
clear  blocked  cardio-pulmonary  blood  vessels.  Prostaglandin E1, a naturally
occurring  hormone, is used to prevent common secondary blockages from occurring
after angioplasty treatment; these blockages are known as restenosis. Restenosis
following  balloon  angioplasty  or  stent  placement is the most common problem


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occurring  in  the  over 1,000,000 patients undergoing these procedures annually
worldwide,  according  to  the  American  Heart  Association.  According  to the
American  Heart  Association,  the  incidence  of  restenosis  can be as high as
40-50%,  within six months of the procedure (slightly less with stents) and most
drugs  tested  have  not  yet  been proven to reduce restenosis significantly in
clinical  trials.  Similarly,  Prostaglandin  E1's  short  lifespan in the blood
stream  can  render it ineffective in preventing restenosis.  Liprostin delivery
system  utilized liposomal encapsulation of Prostaglandin E1 to provide a longer
and  more  controlled  release  of  Prostaglandin  E1 and to improve therapeutic
effectiveness of the drug. Liprostin, as an adjunct therapy for the treatment of
critical  limb  ischemic  (CLI)  complications  will  be  administered  as  an
intra-arterial  bolus  prior  to,  and  immediately  after  PTA  and followed by
intravenous  infusion.  We intend to develop our Liprostin product lines further
to  treat  conditions  such  as  restenosis, coronary arrest, occlusive disease,
ischemic  ulcers,  CLI (limb salvage), claudicants, liver disease,arthritis, and
as  a  topical  solution  for  wound  healing.

     We have successfully completed Phase I clinical trials of Liprostin and, at
the  previous  recommendation  by  the  FDA are preparing for Phase III clinical
trials  for  Critical  Limb  Ischemia  (CLI)  in  a large patient base including
clinical  sites  in  both  the  U.S.  and  Buenos  Aires.

     We have protected our proprietary rights to Liprostin technology through US
Patent  4,820,732,  US  Patent  4,955,878  and  Notice of Allowance to US Patent
5,980,551  received  on  November  9,  1999,  and Trademark Application Ser. No.
75/632,736  (Liprostin)  and  various  patents  pending.


     Stent  Coating  Technology

     We are developing Prostaglandin E-1 coated balloon catheters and stents, as
well  as  Nicotine  Receptor  Agonist  (NRA)  coated  stents for varied vascular
applications.  As  described above, balloon catheters are utilized to physically
expand  and  clear  blocked  blood  vessels  in  vascular  surgical  procedures.
Conversely,  stents  are small structures used during and after vascular surgery
to  support  vessels  and  deliver  agents that promote healing. This technology
accomplishes  the  opening and maintenance of a blood vessel by mechanical means
(stent)  while  providing  medicinal  drug treatment from the gradual release of
Prostaglandin  E1,  NRA  or other drugs from the slowly degrading, biocompatible
substrate  of  the  intravascular  stent.  Other  therapeutic treatments include
anti-tumor  agent coated stents placed in the main feeding vessels for treatment
of  malignant tumors, where the stent will continuously release anti-tumor drugs
directly  to  the  tumor  site.

     We  have  protected  our proprietary rights to our stent coating technology
through  patents  and  patents  pending.


     Nicotine  Receptor  Agonist  Technology

     Our  Nicotine  Receptor  Agonist  technology  promotes  new growth of blood
vessels  (known  as angiogenesis or vasculogenesis), and has applications in the
treatment of heart disease, stroke, limb circulatory disease, and wound healing.
Researches  at Stanford University discovered the technology during a 1999 study
funded  by the Tobacco-Related  Diseases  Research  Program of the University of
California,  the American Heart Association,  the National  Institutes of Health
and  the  Deutsche Froschungsgemeinschkaft.  While studying the damaging effects
of  tobacco smoke, researchers discovered that smokers appeared less susceptible
to  deaths  due to infarction as compared to non-smokers.  This counterintuitive
discovery  suggested  that  low-dose  (non-smoked)  nicotine  had  extraordinary
angiogenic and vasculogenic growth factor potential. To develop technology based
on  this unique discovery, we obtained a worldwide exclusive right to the patent
application  for  Nicotine  Receptor  Agonist  in  February  2000.

     Further  study  of  our  Nicotine Receptor Agonist technology revealed more
conclusive  results.  Experiments have shown that nicotine promotes angiogenesis
and  vasculogenesis  in  areas  of  the  body  that are deprived of proper blood
supply.  Blockages  of the arteries that feed an organ, often caused by build-up
of  fatty  material,  cholesterol and plaques in arterial walls, may deprive the
tissue  of  proper  blood  supply.  These blockages reduce the body's ability to


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supply  organs and surrounding tissue with nutrients, particularly oxygen, which
results  in  a  condition  called  ischemia.  Ischemia reduces cells' ability to
function  and  in  severe  cases  causes  rapid  cell death.  The body naturally
defends  against  ischemia  by reducing the work required from the affected area
and  attempting  to  grow  new  blood  vessels into the ischemic area.  Stanford
researchers  found  tobacco smokers had significantly more growth of new vessels
around  such  blockages  than  non-smokers,  apparently  due  to the therapeutic
effects  of  nicotine.  Upon  further  analysis,  researchers  determined that a
particular  fraction of the nicotine molecule could provide a method of treating
and  preventing  a range of diseases and ailments involving angiogenesis.  These
diseases,  such  as  myocardial  and  cerebral  infarction,  mesenteric  or limb
ischemia,  common  wounds,  vascular  occlusion, and vascular stenosis, commonly
called "hardening of the arteries", affect millions of persons every year in the
United  States  alone  (American  Heart  Association).

     We  estimate  that  the  market  for treatment of these diseases is over $5
billion.  For  example,  we  estimate  that  a  course of treatment for coronary
ischemia  utilizing  Nicotine  Receptor  Agonist  drugs would cost approximately
$10,000 to $15,000. This type of treatment would be significantly less expensive
and  intensive  than  current  alternatives  of  angioplasty  and  or open heart
surgery,  providing  a  "biological  bypass."  We  hope to market a commercially
viable  product  using  this  Nicotine  Receptor Agonist technology within three
years.


Distribution  Methods

     Upon  receipt  of  necessary  governmental regulatory consent, we intend to
distribute  products  utilizing  our  Liprostin,  stent-coating,  and  Nicotine
Receptor  Agonist  technologies  worldwide.  As  previously  described,  we  are
developing  our  products  for  varied  vascular  applications.

     In  addition to peer review, seminars, journals and direct sales, we intend
to  market  and  distribute  our  products in conjunction with business partners
experienced  in  marketing and distribution in the biopharmaceutical and medical
industries.  If  we  are  unable  to  reach  an  agreement  with  marketing  and
distribution partners that is acceptable to us, we may raise the funds necessary
to  create our own production, marketing and distribution infrastructure through
a  public  offering  of  our  securities.


Patents  and  Proprietary  Rights

     We  believe  that  adequate  protection  of our proprietary technology is a
vital  aspect  of  our  business  operations.  Consequently,  we  pursue  patent
protection  for  our  proprietary technology in the United States and in foreign
countries,  as  deemed  necessary  to  protect  development  of  our operations.

     We  have patent protection for several products and are pursuing patent and
trademark  applications  for additional products.  In August 1996, Dr. Jackie R.
See  transferred  and  assigned  patent rights in the United States, Germany and
Canada  for  two  of  our  products.  The first patent, United States Patent No.
4,820,732, was issued on April 11, 1989, and protects our proprietary technology
regarding  a  "Method  and  Composition  for Reducing Dysfunction in Angioplasty
Procedures".  The  second patent, United States Patent No. 4,955,878, was issued
on  September 11, 1990, and protects our proprietary technology regarding a "Kit
for  Treating  Arterial  Dysfunction Resulting from Angioplasty Procedures".  We
have  not maintained the application of this second patent and intend to let its
protections  expire  to  the  benefit of the public domain, except as limited by
patent  applications  described  below.

     In  addition  to these assigned patents, we obtained a United States patent
for  our proprietary technology regarding a "Composition and Method for Making a
Biodegradable  Drug  Delivery  Stent",  on November 9, 1999.  Similarly, we have
filed  a  patent  application  for  this technology under the Patent Cooperation
Treaty,  as  well  as with the European Patent office and European Union.  These
applications  seek  patent protection in France, Germany and the United Kingdom.


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     We  have  United  States  patent  applications  pending  for  several other
technologies.  In June 1997, we filed a United States patent application for our
proprietary  technology  regarding a "Method and Apparatus for Treating Vascular
Disease  with  PGE-1  Bearing Liposomes".  In May 1999, we filed a United States
patent  application  for  our  proprietary technology regarding "Prosthesis with
Biodegradable  Surface  Coating  and  Method  for  Making  Same".  The  May 1999
application  is  a  "continuation  in  part" of our patent application regarding
"Composition and Method for Making a Biodegradable Drug Delivery Stent," and, if
granted, will protect this technology's application in various medical products.
In  June  1999,  we filed a United States patent application for our proprietary
technology  regarding "Sterically Stabilized Liposomes with Improvement of Blood
Retention  Times  and  Targeting  of  Sites  of  Disease  by  Prostaglandins  in
Particulate  Drug  Carriers."  In  May  2000,  we  filed  a United States patent
application  for  proprietary  technology  regarding "Resorbable Prosthesis with
Biodegradable  Surface  Coating  and  Method  for  Making  Same."

     We  are  seeking  trademark  protection  for  the  name Liprostin(TM) under
Trademark  Application  Ser. No.  75/632,736.  In May of 1999, the United States
Patent  and  Trademark  Office  notified us that our pending Patent US Ser.  No.
09/309,949  would  be  allowed  (Notice  of  Allowance).  We  also own rights to
several  trademarks employed in our business, including our logo, the registered
domain  name  of www.endovasc.com, and other trade and service marks identifying
                 ----------------
our  products  and  services.

     In  February  2000,  we  obtained  exclusive  worldwide licensing of patent
rights to develop, manufacture, use and sell products incorporating nicotine and
nicotine  agonists for therapeutic angiogenesis.  Pursuant to our acquisition of
these patent rights from the Leland Stanford Junior University, we agreed to pay
royalties  to the university on sales of any products incorporating the nicotine
agonist technology.  Our licensing rights may be terminated in the event that we
default  on  payment  of  royalties, in addition to certain other circumstances.

     It is important to note that other public and private institutions may have
obtained, or filed applications for, patents that we may need for development of
our  products.  We cannot know the scope or validity of such patents, the extent
that  we  may desire to acquire licenses under such patents, or the availability
of  such  licenses  upon  terms  that  are  acceptable  to  us.


Governmental  Regulation

     United  States  and  international  governmental  regulation  of  the
biopharmaceutical  industry  is  a  significant  factor  in  our  operations,
particularly  our research and development activities.  In the United States the
Food and Drug Administration oversees clinical testing, production and marketing
of  our products for human therapeutic use through rigorous mandatory procedures
and  safety.

     The  Food & Drug Administration requires satisfaction of several procedures
prior  to approving marketing and distribution of pharmaceutical products in the
United  States.  These  include  (i)  preclinical  tests,  (ii) submission of an
application  for an Investigational New Drug, which must become effective before
commencing  human clinical trials,  (iii)  thoroughly  documented and supervised
human  clinical  trials to  determine  drug safety and  efficacy in its intended
application,  (iv)  submission  and  acceptance of an  Investigational  New Drug
Application, in the case of drugs, or a Product License Application, in the case
of biologics,  and (v) approval of the  Investigational  New Drug Application or
Product License  Application prior to commercial sale or shipment of the drug or
biologic.  In  addition  to  this  process,  each  domestic  drug  manufacturing
establishment   must  be   registered   or  licensed  with  the  Food  and  Drug
Administration.  Domestic  manufacturing  establishments  are  also  subject  to
inspections by the FDA and by other  federal,  state and local agencies and must
comply  with  Good  Manufacturing  Practices  as  required.

     Clinical trials are typically  conducted in three sequential phases,  which
may overlap.  Phase I clinical  studies test dosage and  tolerance  upon initial
introduction  of  the  drug  to  humans.  Phase  II  clinical  studies  document
evaluation of drug safety and efficacy.  Phase III trials  document  large scale
evaluation  of drug safety and efficacy and may utilize  larger  patient  pools,
depending  on  the  type  of  marketing  approval  that  is  sought.


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     Clinical testing and the Food and Drug Administration  approval process for
a new product often involves  significant time and resources.  The Food and Drug
Administration  may grant an  unconditional  approval of a drug for a particular
indication or may grant approval  pending  further  post-marketing  testing.  In
addition,  further clinical studies may be required to provide additional safety
data or to  gain  approval  for an  alternative  product  application  than  was
originally  approved.

     International  biopharmaceutical product sales and distribution are subject
to widely varying  regulatory  requirements.  Generally,  the European Union has
coordinated  its member  states'  common  standards for clinical  testing of new
drugs.  Due to difference in regulatory  restrictions  in the European Union and
other foreign jurisdictions the time required to obtain regulatory approval from
a foreign  country's  regulatory  agencies  may be longer or  shorter  than that
required  for  Food  and  Drug  Administration  approval.

     In addition to these  regulations,  our operation is subject to regulations
under state and federal law regarding occupational safety, laboratory practices,
the use and handling of  radioisotopes,  environmental  protection and hazardous
substance  control as well as other present and possible  future  local,  state,
federal  and  foreign  regulation.


Competition

     Competition  in  the  biopharmaceutical   industry  and  the  liposome  and
lipid-based  product  area is  intense.  Factors  such as  product  performance,
patient compliance, physician acceptance, ease of use, safety, price, marketing,
distribution and adaptability of administration  are crucial to capturing market
position  in our  industry.  Competition  may also be  based on other  company's
development  of  alternative  products and  approaches  aimed at the  treatment,
diagnoses  or  prevention  of  the  same  diseases  as  our  products.

     Competition  from other companies is based on scientific and  technological
factors,  the  availability of patent  protection,  the ability to commercialize
technological  developments,  the  ability  to obtain  government  approval  for
testing, manufacturing and marketing and the economic factors resulting from the
use of those  products.  Many  companies,  both  public and  private,  including
well-known  pharmaceutical  and chemical  companies,  many of which have greater
capital  resources  than we do, are seeking to develop lipid and liposome  based
products, as well as stent-coating technologies similar to our own. In addition,
colleges,  universities,  and  public  and  private  research  institutions  are
similarly  seeking  to  establish  proprietary  rights  to  these  product
technologies.

     We face  established  and  well-funded  competition  from  other  companies
developing  liposome  based  drug  delivery systems.  These liposome competitors
include  Eli  Lilly, The Liposome Company and  Schering-Plough.  These companies
generally use liposome for the delivery of antitumor  drugs,  while our products
are  primarily  intended  for  use  in  vascular  treatments.  To our knowledge,
current  competition  in  the  vascular  treatment  area is limited to ReoPro(R)
sold  by  Centocor  and  marketed  by  Eli  Lilly, which is used in angioplasty.

     We  also  face  established and well-funded competition from medical device
manufacturers  in  the  development  of  stent-coating  technologies.  These
competitors  include  major medical device manufacturers such as, Guidant, Inc.,
Cook, Inc., and Boston Scientific, Inc.  To our knowledge current competition in
this  technology  is  limited  to  the use of drugs used in cancer therapies, as
opposed  to  our  Prostaglandin  E1,  which is a naturally occurring, chemically
related  fatty  acid  shown  to  be a potent vasodilator, platelet inhibitor and
anti-thrombotic.

Research  and  Development

     We maintain  1,400 square feet of lab space  equipped  with  customary  wet
laboratory  equipment  at  our  headquarters  in  Montgomery,  Texas.


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     Our  research  and  development  efforts are focused on our core  product -
Liprostin.  We are conducting  clinical trial testing of Liprostin to obtain the
Federal Drug Administration  approval of its sale in the United States.  Phase I
clinical trials to test product safety and tolerance  levels using a small group
of  healthy  subjects,  as  well  as  providing  information about the product's
effectiveness  and  dosage  levels  was  successfully completed in January 2001.
With  this  success,  the  company  determined  to proceed to Phase III clinical
trials as had been suggested by the FDA in late 1999.  An IND and protocol for a
Phase  III,  "Randomized,  multicenter  study  of  Liposomal  prostaglandin  E1
(Liprostin)  in  conjunction  with  percutaneous  transluminal  angioplasty  in
patients  with  critical  limb  ischemia" was filed with the FDA on August 2001.
Also,  the  company  filed an Orphan Drug application with the FDA on July 2001.
Orphan Drug is a designation of the FDA to indicate a therapy developed to treat
a  rare  disease  (one  which  afflicts  a  U.S. population of less than 200,000
people).  Because  there  are  few  financial  incentives  for drug companies to
develop  therapies  for diseases that afflict so few people, the U.S. government
offers  additional  incentives to drug companies that develop these drugs, which
include: 1)eligibility for an FDA grant of up to $300,000 per year for a maximum
of  3  years;  2)a  tax  credit  equal  to 50% of the qualified clinical testing
expenses for the taxable year in which the clinical study(s) were conducted; and
most importantly, 3)a 7 year exclusivity to market the drug as adjunct treatment
for the rare disease.  We expect to complete phase III clinical  trials by  late
2004.

     In  addition,  we  are  conducting  feasibility  studies  with  prospective
strategic  partners to find practical  collaborative  products that  incorporate
Liprostin  with other  technologies.  We intend to develop new uses for our core
product  Liprostin,  including  applications in hip or bone  prostheses,  cancer
treatment,  inflammatory  disease,  liver  disease,  and  wound  healing.

     We have  successfully completed preclinical  trials in rabbits for Nicotine
receptor  agonist  at Stanford University,  and have initiated animal studies in
dogs  and pigs at Columbia University to continue safety and efficacy studies of
this  technology.  We  are  currently  developing  this  technology  for  use in
treatment  of  peripheral  occlusive  arterial  disease,  in  addition  to other
applications.

     We  successfully  completed  a  feasibility  study  of  our  stent-coating
technology  using  our  patented  Prostaglandin  E1  with a major medical device
manufacturer  in  early 2001; and we have continued that work with other medical
device  companies,  as  well.


Employees

     As  of  June  30,  2001,  we  employed  ten  employees,  including  five
management  and  five  support  staff  employees.  In  addition,  we  employ one
full-time  and  twelve  part-time  consultants.  None  of  our  employees  or
independent  contractors  is  subject to a collective  bargaining  agreement and
we  believe  that  our  relations  with  our  employees  are  good.






Item  2.  DESCRIPTION  OF  PROPERTY.

     We maintain our executive  offices and research and development  facilities
at 15001 Walden Road, Suites 108, 100, 234 and 235, Montgomery, Texas 77356.  We
lease  these  4,950  square  foot  facilities  at an  aggregate  monthly  rental
rate  of  $4,150.

     We believe  that our  facilities  are  adequate  for our current  levels of
operations.


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Item  3.  LEGAL  PROCEEDINGS

     As  of  the  date  of  this  filing,  we  are  not involved in any material
litigation  or  legal  proceedings  and  are not aware of any potential material
litigation  or  proceeding  threatened  against  us.

     We  were  named as a defendant in a civil lawsuit styled David F. Miller v.
Endovasc Ltd., Inc., Number 99-4-02283-CV, in the 9th Judicial District Court of
Montgomery  County,  Texas.  The  plaintiff  claimed  damages  as a result of an
alleged  breach  of  consulting contract with us.  A bench trial was held on May
14,  2001.  On June 15, 2001, a judgment was entered against us in the amount of
$3,240,000 plus pre and post-judgment interest.  This judgment exceeded the book
value  of  our  assets.  We  filed  a  motion  for  a new trial, and the parties
participated  in mediation prior to a ruling on our motion for a new trial.  The
mediation  resulted in a settlement, which was entered into the court records on
August  10,  2001.  As  a  result  of  the  settlement,  we  issued  8,000,000
free-trading shares, based on an exemption from registration provided by Section
3(a)  (10)  of the Securities Act of 1933 as amended, of our common stock in the
name  of  the  plaintiff.  The  settlement  terminated  all disputes of any kind
between the parties, and also terminated a related matter styled David F. Miller
v.  Gary  Ball Case #CV0003644, in Washoe County, Nevada.  The above information
was  filed  with  the  SEC  in  a  Form  8-K  on  August  10,  2001.


Item  4.  SUBMISSION  OF  MATTERS  TO  A  VOTE  OF  SECURITYHOLDERS.

     Not  Applicable.





                                     PART  II


Item  5.  MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.

     The Company's  Common Stock trades on the Nasdaq Over the Counter  Bulletin
Board under the symbol  "ENDV." The following  table sets forth for the quarters
indicated the range of high and low closing prices of the Company's Common Stock
as reported  by Nasdaq and the  Electronic  Bulletin  Board but does not include
retail  markups,  markdowns  or  commissions.

<TABLE>
<CAPTION>
Fiscal Quarter Ending:                       Common Stock Price
                                         (rounded to nearest penny)
                                            High           Low
<S>                                      <C>          <C>
June 30, 2001                                   0.18            0.06

March 31, 2001                                  0.40            0.16

December 31, 2000                               0.88            0.16

September 30, 2000                              2.25            0.75

June 30, 2000                                   4.00            1.20

March 31, 2000 (through March 21, 2000)        15.00            0.10

December 31, 1999.                              0.30            0.06

September 30, 1999                              0.63            0.13

June 30, 1999                                   0.88            0.38

March 31, 1999                                  1.00            0.19

December 31, 1998                               1.50            0.38

September 30, 1998                              6.00            0.38
</TABLE>


--------------------------------------------------------------------------------
                                                                          Page 8
<PAGE>
     As  of  June  30,  2001,  the  Company  had  approximately 4,600 record and
beneficial stockholders.


--------------------------------------------------------------------------------
                                                                          Page 9
<PAGE>
     Dividend  Policy

     The Company has never paid cash  dividends  on its Common Stock and intends
to retain  earnings,  if any,  for use in the  operation  and  expansion  of its
business.  The amount of future  dividends,  if any,  will be  determined by the
Board of  Directors  based upon the  Company's  earnings,  financial  condition,
capital  requirements  and  other  conditions.





Item  6.  MANAGEMENT'S  DISCUSSION  AND  ANALYSIS  OF  FINANCIAL  CONDITION
          AND  RESULTS  OF  OPERATIONS

         The statements contained in this prospectus that are not historical are
forward-looking   statements,   including  statements  regarding  the  Company's
expectations,   intentions,   beliefs  or   strategies   regarding  the  future.
Forward-looking statements include the Company's statements regarding liquidity,
anticipated  cash needs and  availability  and anticipated  expense levels.  All
forward-looking  statements included in this prospectus are based on information
available  to the  Company  on the  date  hereof,  and the  Company  assumes  no
obligation to update any such forward-looking statement. It is important to note
that the Company's  actual  results could differ  materially  from those in such
forward-looking statements.  Additionally, the following discussion and analysis
should be read in  conjunction  with the Financial  Statements and notes thereto
appearing  elsewhere  in  this  prospectus.

         The Company is in the development  stage and has had limited  operating
revenues  since its inception on June 10, 1996.  From June 10, 1996 through June
30,  2001,  the  Company  had  an  accumulated  deficit  of  $8,729M.

         The  Company  presented  pre-clinical  data  to  the U.S. Food and Drug
Administration  (FDA)  in  October 1999,  in preparation of its  Investigational
New  Drug (IND) filing for Liprostin,  its liposomal  prostaglandin  E-1 (PGE-1)
drug  for  indications  of  critical  limb ischemia (CLI).  The FDA reviewed the
Company's  data  and responded with a waiver of Phase I & II clinical trials, if
the  Company elected to proceed  directly to a Phase III trial for the  product.
The  Company is determined to pursue Phase I clinical trials in healthy patients
to  establish  dosage  and  tolerance levels of the drug prior to moving forward
with  Phase III as suggested by the FDA.  After review of the  successful report
of the Phase I trials, the company submitted on August 2, 2001 an IND submission
and Phase III protocol; and also submitted to the FDA on July 25, 2001 an Orphan
Drug  application  for  critical limb ischemia. The company anticipates to treat
the  first  patient  in Phase III clinical trials by November 2001.  The company
anticipates  to  receive  notice  from the FDA on the Orphan Drug application in
late  September  2001.  Orphan  Drug  status  for  Liprostin in the treatment of
Critical  Limb Ischemia would provide income to the Company through an FDA grant
to  assist  in  the  offset of development costs of the drug (up to $300,000 per
year  for  a  maximum  of  3  years), as well as a 7-year marketing exclusivity.

     In November 2000, the Company submitted an application for consideration of
a  major  research  grant  for  animal studies of Nicotine Receptor Agonist.  In
April  2001,  the Company was notified of the grant approval for $700,000 over a
two  year  period.  Monies from the grant would not become available until after
November  2001.  Identity of the grantor was requested to remain anonymous until
such  time  as release of the results from the studies.  The Company anticipates
to  have  publication  of  data  released  after  the  first of the year (2002).

         During the fiscal year ended June 30, 2001,  the Company's net revenues
increased  to  $75M  compared  with  revenues  of  $24M for the previous  fiscal
year ended June 30,  2000.  All  revenues  during this period were from sales of
research and development  services provided by the Company to third parties. The
Company  had  agreements  with  a  device  manufacturer  for  feasibility  and
development  of the  proprietary  use of Liprostin  in the  treatment of various
vascular  diseases by application of medicinal  coatings to vascular  stents for
elimination  or  reduction  of new tissue  growth in and around  the  stents,  a
condition  known  as  restenosis.


--------------------------------------------------------------------------------
                                                                         Page 10
<PAGE>
         During  the  fiscal  year  ending  June  30,  2001 and 2000,  costs and
operating  expenses  were  $2,942M  and $2,879M,  respectively.  The increase in
costs and  operating  expenses for the year is  primarily  due to an increase in
the  cost  of  research  and  development,  clinical  trials,  scientific
consulting,  facilities,  and  overhead.

         Cash flows used in operating activities for the fiscal year ending June
30,  2001  increased  $376M  to  $1,943M,  compared  to $1,567M for the previous
fiscal  year  ending  June  30,  2000,  primarily  due  to the increased cost of
scientific consultants, materials and prototype manufacturing and the payment of
these  additional  expenses  with  cash  rather than the Company's common stock.

         Interest expense  decreased for the fiscal year ending June 30, 2001 by
$109M  or  86%.  This  was  due to the convertible debentures being converted to
common  stock  during  the  fiscal  year  ended  June  30, 2000, resulting in no
convertible  debentures  outstanding during the fiscal year ended June 30, 2001.

         Research  and development  expenses  totaled  $1,348M during the fiscal
year  ending June 30, 2001, an increase of $371M from $977M for the  fiscal year
ended  June  30,  2000.   These  expenses  were related to the increased cost of
new  materials,  labor  and travel connected to the production of the  Liprostin
and  the  ongoing,  in-house  projects  for  medicinally coated vascular stents.


Liquidity  and  Capital  Resources

         The  Company  had a  working  capital  deficit  on June  30,  2001,  of
$841M,  compared  to  a  working capital deficit of $138M at June 30, 2000. This
increase  was  primarily  due to the increased use of cash to fund the Company's
operations,  the  settlement of a litigation matter and the increase in payables
related  to  our  ongoing  research  and  development.

         The  Company  requires  significant  additional  funds to  enable it to
continue its  Liprostin  product  development  and to complete its Food and Drug
Administration  required clinical trials, as well as research and development of
its  licensed  product  nicotine  receptor  agonist  (NRA) and its stent coating
technology.

         The  Company  continues  to  actively  pursue   additional   financing,
collaborations  with  firms,  and other  arrangements  aimed at  increasing  its
capital  resources.  Failure to  acquire  such  funds may  adversely  impact the
scheduled  marked  introduction of Liprostin and possibly  adversely  affect the
Company's operations.  In order to continue as a going concern, the Company must
raise  additional  funds as noted above and  ultimately  achieve profit from its
operations.


Item  7.  FINANCIAL  STATEMENTS  AND  SUPPLEMENTARY  DATA.

         The  response  to  this  item  is  set forth at the end of this report.




                                    PART  III


Item  8.  CHANGES  IN  OR  DISAGREEMENTS  WITH  ACCOUNTANTS

         None.


--------------------------------------------------------------------------------
                                                                         Page 11
<PAGE>
Item  9.  DIRECTORS,  EXECUTIVE  OFFICERS,  PROMOTERS  AND  CONTROL  PERSONS;
        COMPLIANCE  WITH  SECTION  16(a)  OF  THE  EXCHANGE  ACT.

     Our  executive  officers,  directors  and key  employees and their ages and
positions  with  us  as  of  June  30,  2001,  are  as  follows:


<TABLE>
<CAPTION>
                                                           Period  Served  As
Name                   Age            Position             Officer/Director/Key Employee
---------------------  ---  -----------------------------  -----------------------------
<S>                    <C>  <C>                            <C>

David P. Summers        62  Chief Executive Officer        Inception (1996) to
                            and Chairman                   Present

Diane Dottavio          49  Director of Research and       March 2000 to Present
                            Development

Barbara J. Richardson   54  Vice President of Operations,  January 2000 to Present
                            Secretary and Director


M. Dwight Cantrell      55  Chief Financial Officer,       January 1997 to Present
                            Treasurer and Director

John T. (Jack) Sorbi    64  Vice President of Business     November 2000 to Present
                            Development/Sales/Marketing

Gary R. Ball            41  Director                       July 1996 to Present

Claudio R. Roman        43  Director                       January 1997 to Present
</TABLE>

Set forth below is a brief background of the executive  officers,  Directors and
key  employees  of  the  Company,  based  on  information  supplied  by  them.

     Dr. David P. Summers  serves as our Chief  Executive  Officer and Chairman.
Dr. Summers has served in this capacity on a full-time basis since our inception
and is primarily  responsible  for our  operations as a whole.  Prior to working
with  Endovasc,  Dr. Summers  founded  American  BioMed,  Inc. and served as its
President and Chief Executive Officer from 1984 to 1995. Dr. Summers is a Fellow
in the American College of Angiology,  a Fellow in the International Society for
endovascular Surgery, as well as the inventor of several medical devices used to
treat cardiovascular  diseases.  He is the author of 25 issued patents and has 8
patents pending.  Prior to founding  American BioMed,  Dr. Summers assisted with
the management of several corporations, including C.R. Bard, Inc., a manufacture
and distributor of cardiovascular  medical products,  Karl Stortz Endoscopy,  an
endoscopic  instrument  company,  and  Pall  Corporation,   a  manufacturer  and
distributor of blood  filtration  products.  Dr. Summers holds an M.B.A.  degree
from Pepperdine  University as well as a Ph.D. in  International  Economics from
Kennedy-Western  University.  He is also a  member  of the New York  Academy  of
Sciences,  the  American  Association  of  Advancement  of Science,  the Houston
Inventors Association, the European Vascular Society  and the Society of Plastic
Engineers.


     Diane Dottavio serves as our Director of Research and Development. Prior to
joining us in March of this year, Ms. Dottavio  served as Senior  Scientist with
Leukosite,  Inc.,  from 1994 to 1996, and as Director of Laboratory  Instruction
and Research at the University of Houston,  from 1997 to this year. Ms. Dottavio
holds a B.S. in Biology and a M.S. in Organic  Chemistry  from the University of
New  Mexico,  as  well  as a Ph.D. in Biochemistry from the University of Texas.


--------------------------------------------------------------------------------
                                                                         Page 12
<PAGE>
     Barbara J. Richardson serves as our Vice President of Operations, Secretary
and  Director.  Ms.  Richardson has more than 10 years' experience in management
and  marketing  n  a  small  business environment. Her previous association with
Baylor  College  of  Medicine in Houston utilized her knowledge and expertise in
the  areas  of  medical  education,  conference  management,  development  of
multi-media  medical  education materials, and FDA guidelines as they pertain to
continuing  medical  education  and  marketing of new drugs and medical devices.

     M.  Dwight  Cantrell  serves  as our Chief Financial Officer, Treasurer and
Director.  Mr.  Cantrell  has  maintained,  and  continues to maintain, a public
accounting  practice in the state of Texas since 1976.  Mr. Cantrell is a public
accountant,  and  holds  a  B.B.A. in accounting  from Southern Ohio University.

     John  (Jack)  Sorbi,  as our Vice President of Business Development, Sales,
and  Marketing,  is  responsible  for pursuing collaborations and alliances with
companies  who  can complement the company's products and achieve company goals.
He  also  maintains  communications  with  the  shareholders  and the investment
community.  Mr. Sorbi  has a thirty-five year background in sales, marketing and
operations  in  both large and small business environments. He has experience in
new  business  development  and  building  strong  partnerships through creative
programs  and  various  media  promotions,  such  as  video,  broadcast,  and
conventions.  As  the owner of his own agency for a number of years, he assisted
businesses  in  banking,  retail,  and  medical  device  manufacturing.

     Gary R. Ball serves as our Director and is one of our co-founders. Prior to
co-founding  us in July 1996,  Mr. Ball  served as a  mechanical  engineer  with
American BioMed,  Inc., from 1991 to 1996. Mr. Ball is a co-inventor of two U.S.
patents and is experienced in prototype design,  research,  and development,  as
well  as  reliability  testing  and  patent  research  and  filing.

     Claudio  R.  Roman serves as a Director. Mr. Roman is a practicing attorney
in the State of Texas.  Mr. Roman has maintained,  and continues to maintain,  a
private law  practice in the state of Texas since 1985.  Mr.  Roman holds a J.D.
degree  from  the  University  of  Houston  School  of  Law.

     Our Directors hold office until the next annual meeting of our stockholders
and until  their  successors  have been  elected and duly  qualified.  Executive
officers  are  elected  by our  Board of  Directors  annually  and  serve at the
discretion  of  the  Board.

     Non-employee  Directors receive no salary for their services and receive no
fee from the Company for their participation in meetings, although all Directors
are reimbursed for reasonable travel and other  out-of-pocket  expenses incurred
in  attending  meetings  of  the  Board.


Item  10.  EXECUTIVE  COMPENSATION.


     The following table sets forth certain summary  information with respect to
the  compensation paid to the executive officers for services rendered to us, in
all  capacities,  for  the  fiscal  years ended June 30, 1999,  1998,  and 1997.
Other than as listed  below,  we had no  executive  officers  whose total annual
salary  and  bonus  exceeded  $100,000  for  that  fiscal  year:


<TABLE>
<CAPTION>
                                       Summary Compensation Table

                                                                          Long Term Compensation
                             Annual Compensation                  Awards                        Payouts

                                                            Other                        Securities
                                                            Annual       Restricted      Under-                        Other
Name and                                                    Compen-       Stock          Lying            LTIP         Compen-
Principal                           Salary       Bonus      sation        Awards         Options/       Payouts        sation
Position                   Year      ($)          ($)         ($)           ($)            ($)             ($)         SARs(#)
<S>                        <C>   <C>        <C>         <C>          <C>              <C>            <C>          <C>
David P. Summer            2001     75,097         -            -            -            200,000         $0.40
David P. Summers           2000     66,500         -            -            -                -              -             -
CEO and Director           1999     75,000         -            -            -          1,000,000         $0.25            -
                           1998     60,000         -            -            -               -              -              -
</TABLE>


--------------------------------------------------------------------------------
                                                                         Page 13
<PAGE>
     Directors  of the Company  receive no  compensation  for their  services as
Directors.

Employment  and  Other  Agreements


     We have entered into  employment  agreements with Dr. David Summers and Ms.
Barbara  Richardson.  We entered into a three-year  employment contract with Dr.
Summers in 1996,  providing  for annual  compensation  of  $150,000  in cash and
equity interests.  The original term of this contract has expired,  but the term
has  been renewed for a one-year period each June since its original expiration.

     We also have a one-year  automatically  renewable  employment contract with
Ms. Richardson,  providing for annual compensation of $70,000 in cash and equity
interests.


Stock  Option  Plans

     We  adopted  a  stock  option  plan  (the  "2000  Plan")  at  our  annual
shareholders  meeting  in October, 2000,  pursuant to which 3,000,000  shares of
common  stock  were reserved for issuance. The following is a description of the
2000  Plan.

     The 2000  Plan will be  administered  by the  Board of  Directors,  or by a
committee with at least two Directors as delegated by the Board of Directors who
determine among other things,  those individuals who shall receive options,  the
time period  during which the options may be partially or fully  exercised,  the
number of shares of common stock  issuable  upon the exercise of the options and
the  option  exercise  price.

     The 2000  Plan will be for a period of ten  years.  Options  under the 2000
Plan must be issued within ten years from the  effective  date of the 2000 Plan.
Options  may be granted to  officers,  Directors,  consultants,  key  employees,
advisors  and similar  parties who provide  their  skills and  expertise  to us.
Options granted under the 2000 Plan may be exercisable for up to ten years,  may
require  vesting,  and  shall  be  at  an exercise  price as  determined  by the
Board  of  Directors.  Options  will be  non-transferable  except  to an  option
holder's  personal  holding  company or registered  retirement  savings plan and
except by the laws of descent and  distribution  or a change in our control,  as
defined in the 2000 Plan, and are exercisable only by the participant during his
or her lifetime. Change in control includes (i) the sale of substantially all of
our assets and merger or consolidation  with another,  or (ii) a majority of the
Board of Directors  changes other than by election by the shareholders  pursuant
to a Board of  Directors'  solicitation  or by vacancies  filled by the Board of
Directors  caused  by  death  or  resignation  of  such  person.

     If a participant ceases  affiliation with us by reason of death,  permanent
disability  or the  retirement  of an optionee  either  pursuant to a pension or
retirement  plan we adopted on the normal  retirement date prescribed by us from
time to time,  the  option  remains  exercisable  for  three  months  from  such
occurrence but not beyond the option's  expiration date. Other termination gives
the participant three months to exercise,  except for termination for cause that
results  in  immediate  termination  of  the  option.

     Options granted under the 2000 Plan, at the discretion of the  compensation
committee  or the Board of  Directors,  may be  exercised  either with cash,  by
certified check or bank cashier's check, common stock having a fair market equal
to the cash  exercise  price,  the  participant's  promissory  note,  or with an
assignment  to us of  sufficient  proceeds  from  the sale of the  common  stock
acquired  upon  exercise of the Options with an  authorization  to the broker or
selling  agent  to  pay  that  amount  to  us,  or any combination of the above.


--------------------------------------------------------------------------------
                                                                         Page 14
<PAGE>
     The exercise  price of an option may not be less than the fair market value
per share of common  stock on the date that the  option is  granted  in order to
receive  certain  tax  benefits  under the Income Tax Act of United  States (the
"ITA").  The exercise  price of all future  options will be at least 100% of the
fair market  value of the common  stock on the date of grant of the  options.  A
benefit  equal to the amount by which the fair market value of the shares at the
time the  employee  acquires  them  exceeds the total of the amount paid for the
shares or the amount paid for the right to acquire the shares shall be deemed to
be received  by the  employee  in the year the shares are  acquired  pursuant to
paragraph  7(1) of the ITA.  Where the exercise  price of the option is equal to
the fair market value of the shares at the time the option is granted, paragraph
110(1)(d) of the ITA allows a deduction  from income equal to one quarter of the
benefit as calculated  above.  If the exercise  price of the option is less than
the fair market value at the time it is granted,  no deduction  under  paragraph
110(1)(d)  is permitted. Options granted to non-employees,  whether Directors or
consultants  or  otherwise  will  confer a tax benefit in  contemplation  of the
person  becoming  a  shareholder  pursuant  to  subsection  15(1)  of  the  ITA.

     Any  unexercised  options that expire or that  terminate upon an employee's
ceasing to be employed by us become  available again for issuance under the 2000
Plan.



     The 2000  Plan may be  terminated  or  amended  at any time by the Board of
Directors,  except  that the  number  of shares of  common  stock  reserved  for
issuance  upon the  exercise of options  granted  under the 2000 Plan may not be
increased  without  the  consent  of  our  shareholders.

     At  June 30, 2001 1,325,500 options have been issued at prices ranging from
$1.00  to  $0.40.



Item  11.  SECURITY  OWNERSHIP  OF  CERTAIN  BENEFICIAL  OWNERS  AND MANAGEMENT.

     The  following  table sets forth certain  information  as of June 30, 2001,
with respect to the number of shares of each class of voting stock  beneficially
owned by (i) those  persons  known to the  Company to be the owners of more than
five  percent  of any such  class of  voting  stock of the  Company,  (ii)  each
director of the Company and (iii) all directors  and  executive  officers of the
Company as a group. Unless otherwise  indicated,  each of the listed persons has
sole voting and investment power with respect to the shares  beneficially  owned
by  such  shareholder.

                                                 Percentage of
Name and Address of     Amount of                 Beneficial
Beneficial Owner (1)    Beneficial                Ownership
                        Ownership(2)(3)

David P. Summers          7,574,526 (4)             19.82
Diane Dottavio              100,000                  0.26
Barbara J. Richardson     1,260,000                  3.30
Jack Sorbi                   25,000                  0.08
M. Dwight Cantrell        1,760,000                  4.61
Gary R. Ball                993,500 (5)              2.60
Claudio R. Roman             50,000                  0.13

All  Directors  and  Executive  Officers  as  a  Group            11,763,026
30.80
(7  persons)
----------------------

     (1)  Except as  otherwise  noted,  the  address  of the  beneficial  owners
described in this table shall be c/o  Endovasc  Ltd.,  Inc.,  15001 Walden Road,
Suite  108,  Montgomery,  Texas  77356.


--------------------------------------------------------------------------------
                                                                         Page 15
<PAGE>
     (2) The  securities  "beneficially  owned" by a person  are  determined  in
accordance with the definition of "beneficial  ownership" set forth in the rules
and  regulations  promulgated  under the  Securities  Exchange  Act of 1934,  as
amended, and accordingly, may include securities owned by and for, among others,
the spouse and/or minor children of an individual and any other relative who has
the same home as such  individual,  as well as other  securities as to which the
individual has or shares voting or investment power or which such person has the
right to acquire within 60 days after the Record Date pursuant to the conversion
of convertible equity,  exercise of options, or otherwise.  Beneficial ownership
may  be  disclaimed  as  to  certain  of  the  securities.

     (3)  Based upon 38,168,331  shares of common stock  outstanding  as of June
30,  2001,  assuming  no  other  changes  in  the  beneficial  ownership  of our
securities,  except  as  noted  in  note  (7)  hereto.

     (4) Dr. Summer's  beneficially owned shares include  approximately  243,000
shares beneficially owned by his wife, Dorothy Summers. Dr. Summers exercises no
investment  or  voting  power  over any of the  shares  owned by his  wife,  and
disclaims  beneficial  ownership  of  those  shares.

     (5) Mr. Ball's beneficially owned shares include approximately 5,000 shares
beneficially owned by his wife, Sherry Ball. Mr. Ball exercises no investment or
voting power over any of the shares owned by his wife, and disclaims  beneficial
ownership  of  those  shares.




Item  12.  CERTAIN  RELATIONSHIPS  AND  RELATED  TRANSACTIONS.

     As of the June 30, 2001, we have not entered into a transaction  during the
past two years with a value in excess of $60,000  with a Director,  officer,  or
beneficial  owner  of 5% or more of our  capital  stock,  or  members  of  their
immediate  families  that  had,  or is to have,  a direct or  indirect  material
interest  in  us,  except  as  follows:

     Effective  December 9, 1997, we entered into a stock option  agreement with
Gary  R.  Ball. Under this agreement, Mr. Ball was granted an option to purchase
up  to  600,000  shares  of  our  common  stock  at  a purchase  price below the
prevailing market price. The option is for a three year period expiring December
8,  2000.  This option was exercised during the fiscal year ended June 30, 2000.

     During  the  fiscal  year  ended June 30,  1998,  we also  entered  into an
agreement with M. Dwight  Cantrell  under the terms of which he was  compensated
for past  services  as our  Director.  Under  the terms of this  agreement,  Mr.
Cantrell was granted an option to purchase 100,000 shares of our common stock at
a  purchase  price  of  $0.25  per  share  for  a  term  of  three  years.

     During the fiscal year ended June 30, 1998, we entered into an agreement to
purchase the rights to patent number  4,820,732  and patent number  955,878 from
Francis Pizzulli. The purchase price was $125,000,  $50,000 of which was payable
upon  execution and $75,000 of which was due by December 31, 1997. The agreement
also called for the issuance of 200,000 shares of our common stock.  We made the
initial $50,000 payment and issued the 200,000 shares of stock,  pursuant to the
exemption from registration under Section 4(2) of the Securities Act of 1933, as
amended.  However,  we did not  make  the  $75,000  payment  as  scheduled.  The
agreement  indicated  that if the final payment was not made within seven months
from the execution of the agreement that the final payment would be increased to
$150,000 plus the issuance an additional  200,000  shares of stock.  We issued a
total  of 300,000 shares in final settlement of the agreement, in February 2000.

     Between March 1998 and December 1999,  David  Summers,  our Chairman of the
Board  of  Directors  and Chief  Executive  Officer,  made two advances to us in
the  amounts  of $123,000 and $25,000,  respectively.  These  advances were made
on  an  unsecured  basis, with no interest accrual,  and were due and payable on
June  30,  2000.  During  December  1999,  we  issued 1,250,000 shares of common
stock,  valued at $0.10 to $0.12  per share as of the date of the  issuance,  in
full  and  final  repayment  of  the  aforementioned  advances.


--------------------------------------------------------------------------------
                                                                         Page 16
<PAGE>
     During the fiscal year ended June 30,  1998,  we entered  into an agreement
with Claudio Roman, Esq., pursuant to which he was compensated for past services
as  our  legal  counsel.  Under  the  terms  of  this  agreement,  Mr. Roman was
granted  an  option to purchase  50,000 shares of our common stock at a purchase
price  of  $0.25  per  share for a term of three years. This option has not been
exercised.

     During  the  fiscal  year  ending June 30,  1998,  we entered  into a stock
option  agreement  with  Dr.  David  P.  Summers.  Under  this  agreement,  Dr.
Summers was granted an option to purchase up to  1,000,000  shares of our common
stock  at  a purchase price of $0.25 per share exercisable for a period of three
years.  This  option  was exercised during the fiscal year ending June 30, 2001.

     The  Company  believes  that all  transactions  between the Company and its
officers, directors and employees described above are on terms no less favorable
to the Company than could have been  obtained  from  unaffiliated  parties under
similar  circumstances  other  than  certain  advances  received  from Dr. David
Summers  which  are  non-interest  bearing.


Item  13.  EXHIBITS,  LIST,  AND  REPORTS  ON  FORM  8-K.



         (a)      INDEX  TO  EXHIBITS

Exhibit No.    Exhibit
-------------  -----------------------------------------------------------------
          3.1  Articles  of  Incorporation  of  the  Company  **
          3.2  Bylaws  of  the  Company  **
          4.1  Form  of  8%  Series A Senior Subordinated Convertible Redeemable
     Debenture  **
          4.2  Form  of  8%  Series B Senior Subordinated Convertible Redeemable
     Debenture  **
          4.3  Specimen  Stock  Certificate  of  the  Company  **
          10.1  Form  of  Employment  Agreement  with  Dr.  David Summers, dated
     December  18,  1996  ***
          10.2  Form  of Employment Agreement with Ms. Barbara Richardson, dated
     June  1,  2000  ***
          10.3  Form  of  Consulting  Services Agreement with Mr. Roy Robertson,
     dated  March  1,  2000  ***
          10.4  Form  of  Subscription  Agreement  for  Purchase  of Series A 8%
     Cumulative  Convertible  Preferred  Stock*
          10.5  Certificate  to  Set  Forth  Designations,  Voting  Powers,
     Preferences,  Limitations,  Restrictions and Relative Rights of Series A 8%
     Cumulative  Convertible  Preferred  Stock*
          10.6  Form  of  Common  Stock  Purchase  Warrant*
          10.7  Lease  of  Company's  Facility  at 15001 Walden Road, Suite 108,
     Montgomery,  Texas  77356  ***
          10.8  Lease of Company's Facility at 15001 Walden Road, Suites 234 and
     235,  Montgomery,  Texas  77356  ***
          16.1  Letter  on  change  in  certifying  accountant  **
          27.1  Financial  Data  Schedule

     *    Incorporated  by  reference  from the Registrant's Form SB-2, filed on
June  30,  2000.

     **   Incorporated  by  reference from the Registrant's Form 10-SB, filed on
December  3,  1999.

     ***  Incorporated  by reference from the Registrant's Form SB-2/A, filed on
July  20,  2000.

         (b)      Reports  on  Form  8-K:

                  None.


--------------------------------------------------------------------------------
                                                                         Page 17
<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, thereunto duly
authorized.

                                         ENDOVASC  LTD.,  INC.


                                    By:/s/  David  P.  Summers
                                       David P. Summers, Chief Executive Officer


                                    By:/s/  Barbara  J.  Richardson
                                       Barbara  J.  Richardson,  Secretary

Dated:  September  28,  2001

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

Date:  September  28,  2001       /s/  David  P.  Summers
                                         David P. Summers, Chairman of the Board


Date:  September  28,  2001       /s/  M.  Dwight  Cantrell
                                         M.  Dwight  Cantrell,  Director


Date:  September  28,  2001       /s/  Gary  R.  Ball
                                         Gary  R.  Ball,  Director


Date:  September  28,  2001       /s/  Claudio  R.  Roman
                                         Claudio  R.  Roman,  Director


Date:  September  28,  2001       /s/  Barbara  J.  Richardson
                                         Barbara  J.  Richardson,  Director


--------------------------------------------------------------------------------
                                                                         Page 18
<PAGE>







                               ENDOVASC LTD., INC.
                    (A CORPORATION IN THE DEVELOPMENT STAGE)
                                   __________




                              FINANCIAL STATEMENTS
                     WITH REPORT OF INDEPENDENT ACCOUNTANTS
       AS OF JUNE 30, 2001 AND FOR THE YEARS ENDED JUNE 30, 2001 AND 2000,
                AND FOR THE PERIOD FROM INCEPTION, JUNE 10, 1996,
                                TO JUNE 30, 2001







<PAGE>
<TABLE>
<CAPTION>
                               ENDOVASC LTD., INC.
                    (A CORPORATION IN THE DEVELOPMENT STAGE)
                                TABLE OF CONTENTS
                                   __________


                                                                             PAGE(S)
                                                                             -------
<S>                                                                          <C>
Report of Independent Accountants                                            F-2

Financial Statements:

  Balance Sheet as of June 30, 2001                                          F-3

  Statement of Operations for the years
    ended June 30, 2001 and 2000, and for
    the period from inception, June 10, 1996,
    to June 30, 2001                                                         F-4

  Statement of Stockholders' Deficit for
    the years ended June 30, 2001 and 2000,
    and for the period from inception, June 10,
    1996, to June 30, 2001                                                   F-5

  Statement of Cash Flows for the years
    ended June 30, 2001 and 2000, and for
    the period from inception, June 10, 1996,
    to June 30, 2001                                                         F-8

Notes to Financial Statements                                                F-9
</TABLE>


                                       F-1
<PAGE>
                        REPORT OF INDEPENDENT ACCOUNTANTS
                        ---------------------------------



To  the  Stockholders  of
Endovasc  Ltd.,  Inc.


We  have  audited  the  accompanying  balance  sheet  of  Endovasc Ltd., Inc. (a
development stage enterprise) as of June 30, 2001, and the related statements of
operations,  stockholders'  deficit  and cash flows for the years ended June 30,
2001  and  2000,  and  for the period from inception, June 10, 1996, to June 30,
2001.  These  financial  statements  are  the  responsibility  of  the Company's
management.  Our  responsibility  is  to  express  an opinion on these financial
statements  based  upon  our  audit.

We  conducted  our  audits  in  accordance  with  generally  accepted  auditing
standards.  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  audits  provide  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 Endovasc Ltd., Inc. as of June
30,  2001,  and  the  results of its operations and its cash flows for the years
ended  June 30, 2001 and 2000, and for the period from inception, June 10, 1996,
to  June  30, 2001, in conformity with generally accepted accounting principles.

The  accompanying  financial  statements  have  been  prepared assuming that the
Company  will continue as a going concern.  As shown in the financial statements
and  discussed in Note 11, the Company has incurred significant recurring losses
from  operations  since  inception,  is  in  a  negative  working  capital  and
accumulated  deficit  position  at  June  30,  2001, and is dependent on outside
sources  of  financing  for  the  continuation of its operations.  These factors
raise  substantial  doubt  about  the  Company's  ability to continue as a going
concern.  Management's  plans  with  regard to this matter are also discussed in
Note  11.  These  financial statements do not include any adjustments that might
result  from  the  outcome  of  this  uncertainty.


/S/ Ham, Langston & Brezina, LLP.

Houston,  Texas
September  19,  2001


                                       F-2
<TABLE>
<CAPTION>
                               ENDOVASC LTD., INC.
                    (A CORPORATION IN THE DEVELOPMENT STAGE)
                                  BALANCE SHEET
                                  JUNE 30, 2001
                                   __________
                        (IN THOUSANDS, EXCEPT SHARE DATA)


          ASSETS
          ------
<S>                                                    <C>
Current assets:
  Cash and cash equivalents                            $   117
  Other current assets                                      47
                                                       --------

    Total current assets                                   164

Property and equipment, net                                214
Other assets, net                                          144
                                                       --------

      Total assets                                     $   522
                                                       ========

LIABILITIES AND STOCKHOLDERS' DEFICIT
-------------------------------------

Current liabilities:
  Current maturities of long-term debt                 $    43
  Current portion of obligations under capital leases       35
  Note payable to shareholder                               99
  Accounts payable                                         296
  Accrued liabilities                                      532
                                                       --------

    Total current liabilities                            1,005

Long-term debt, net of current maturities                   28
Long-term obligations under capital leases                  74
                                                       --------

      Total liabilities                                  1,107
                                                       --------

Commitment and contingencies

Stockholders' deficit:
  Common stock, $.001 par value, 100,000,000 shares
    authorized, 40,253,331 shares issued and
    38,168,331 shares outstanding                           40
  Preferred stock, $.001 par value, 20,000,000 shares
    authorized, 15,760 shares of Series A 8% cumula-
    tive convertible preferred stock issued and out-
    standing, stated value $100 per share                    -
  Additional paid-in capital                             8,121
  Losses accumulated during the development stage       (8,729)
  Treasury stock                                           (17)
                                                       --------

    Total stockholders' deficit                           (585)
                                                       --------

      Total liabilities and stockholders' deficit      $   522
                                                       ========
</TABLE>


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


                                       F-3
<PAGE>
<TABLE>
<CAPTION>
                               ENDOVASC LTD., INC.
                     (A CORPORATION IN THE DEVELOPMENT STAGE)
                             STATEMENT OF OPERATIONS
                  FOR THE YEARS ENDED JUNE 30, 2001 AND 2000 AND
          FOR THE PERIOD FROM INCEPTION, JUNE 10, 1996, TO JUNE 30, 2001
                                    __________
                        (IN THOUSANDS, EXCEPT SHARE DATA)



                                                 YEAR ENDED
                                         -------------------------    INCEPTION
                                           JUNE 30,     JUNE 30,     TO JUNE 30,
                                             2001         2000          2001
                                         ------------  -----------  -------------
<S>                                      <C>           <C>          <C>
Income:
  Sales                                  $        75   $       24   $        104
  Interest income                                 20            7             27
  Other income                                     5            -              9
                                         ------------  -----------  -------------

    Total income                                 100           31            140
                                         ------------  -----------  -------------

Costs and expenses:
  Operating, general and administrative
    expenses                                   1,168        1,775          4,327
  Research and development costs               1,348          977          3,524
  Interest expense                                18          127            348
  Settlement with former employee                408            -            408
                                         ------------  -----------  -------------

    Total costs and expenses                   2,942        2,879          8,607
                                         ------------  -----------  -------------

Net loss before extraordinary item            (2,842)      (2,848)        (8,467)

Extraordinary loss on extinguishment
  of convertible debentures                        -          127            127
                                         ------------  -----------  -------------

Net loss                                 $    (2,842)  $   (2,975)  $     (8,594)
                                         ============  ===========  =============


Weighted average shares outstanding       17,269,229    9,575,153
                                         ============  ===========


Basic net loss per common share          $     (0.17)  $    (0.31)
                                         ============  ===========


Diluted net loss per common share        $     (0.16)  $    (0.31)
                                         ============  ===========
</TABLE>


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


                                       F-4
<PAGE>
<TABLE>
<CAPTION>
                                                        ENDOVASC LTD., INC.
                                             (A CORPORATION IN THE DEVELOPMENT STAGE)
                                            STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT)
                                          FOR THE YEARS ENDED JUNE 30, 2001 AND 2000, AND
                                   FOR THE PERIOD FROM INCEPTION, JUNE 10, 1996 TO JUNE 30, 2001
                                                            __________
                                                 (IN THOUSANDS, EXCEPT SHARE DATA)


                                                                                                              LOSSES
                                                                                                            ACCUMULATED
                                       COMMON STOCK              PREFERRED STOCK     ADDITIONAL             DURING THE
                                ------------------------------  ------------------    PAID-IN     TREASURY  DEVELOPMENT
                                   AMOUNT          SHARES        AMOUNT    SHARES     CAPITAL      STOCK      STAGE        TOTAL
                                -------------  ---------------  --------  --------  ------------  -------  ------------  ---------
<S>                             <C>            <C>              <C>       <C>       <C>           <C>      <C>           <C>
Balance at inception, June 10,
  1996                          $           -                -  $      -         -  $          -  $    -   $          -  $      -

Stock issued for equity secur-
  ities in 1996                             2        2,332,000         -         -           300       -              -       302

Stock issued for purchase of
  patent rights in 1996                     2        2,188,000         -         -           282       -              -       284

Stock issued for services in
  1997                                      2        1,702,000         -         -           354       -              -       356

Stock issued for cash in 1997               1          304,571         -         -           205       -              -       206

Stock issued for purchase of
  patent rights in September
  1997                                      -          200,000         -         -           200       -              -       200

Stock issued for services in
  1998                                      -           77,380         -         -            56       -              -        56

Stock subject to rescission                 -                -         -         -             -     (17)             -       (17)

Conversion of debentures to
  common stock                              1        1,208,077         -         -           444       -              -       445

Stock issued for services                   -          362,462         -         -           285       -              -       285
</TABLE>


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


                                       F-5
<PAGE>
<TABLE>
<CAPTION>
                                                      ENDOVASC LTD., INC.
                                            (A CORPORATION IN THE DEVELOPMENT STAGE)
                                     STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT), CONTINUED
                                        FOR THE YEARS ENDED JUNE 30, 2001 AND 2000, AND
                                 FOR THE PERIOD FROM INCEPTION, JUNE 10, 1996 TO JUNE 30, 2001
                                                           __________
                                               (IN THOUSANDS, EXCEPT SHARE DATA)


                                                                                                            LOSSES
                                                                                                          ACCUMULATED
                                          COMMON STOCK           PREFERRED STOCK     ADDITIONAL           DURING THE
                                  -----------------------------  -----------------    PAID-IN   TREASURY  DEVELOPMENT
                                     AMOUNT         SHARES       AMOUNT    SHARES     CAPITAL    STOCK       STAGE      TOTAL
                                  ------------  ---------------  -------  --------  -----------  ------  ------------  --------
<S>                               <C>           <C>              <C>      <C>       <C>          <C>     <C>           <C>
Losses accumulated during the
  period from inception,
  June 10, 1996, to June 30,
  1999                                       -                -        -         -            -      -        (2,777)   (2,777)
                                  ------------  ---------------  -------  --------  -----------  ------  ------------  --------

Balance at June 30,1999                      8        8,374,490        -         -        2,126    (17)       (2,777)     (660)

Conversion of debentures to
  common stock                               3        2,569,546        -         -          841      -             -       844

Stock issued for services                    2        1,869,334        -         -        1,388      -             -     1,390

Conversion of note payable to
  shareholder to common stock                1        1,250,000        -         -          147      -             -       148

Issue of common stock in connec-
  tion with license agreement                -          190,000        -         -           63      -             -        63

Issue of common stock in set-
  tlement of lawsuit                         1          300,000        -         -          192      -             -       193

Issuance of preferred stock                  -                -        -    15,000        1,040      -             -     1,040

Net loss accumulated in 2000                 -                -        -         -            -      -        (2,975)   (2,975)
                                  ------------  ---------------  -------  --------  -----------  ------  ------------  --------

Balance at June 30, 2000                    15       14,553,370        -    15,000        5,797    (17)       (5,752)       43
</TABLE>


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


                                       F-6
<PAGE>
<TABLE>
<CAPTION>
                                                      ENDOVASC LTD., INC.
                                            (A CORPORATION IN THE DEVELOPMENT STAGE)
                                     STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT), CONTINUED
                                        FOR THE YEARS ENDED JUNE 30, 2001 AND 2000, AND
                                 FOR THE PERIOD FROM INCEPTION, JUNE 10, 1996 TO JUNE 30, 2001
                                                           __________
                                               (IN THOUSANDS, EXCEPT SHARE DATA)


                                                                                                          LOSSES
                                                                                                        ACCUMULATED
                                    COMMON STOCK        PREFERRED STOCK       ADDITIONAL                DURING THE
                                  -------------------  --------------------    PAID-IN      TREASURY    DEVELOPMENT
                                  AMOUNT     SHARES      AMOUNT     SHARES     CAPITAL       STOCK         STAGE        TOTAL
                                  -------  ----------  ----------  --------  ------------  ----------  -------------  ---------
<S>                               <C>      <C>         <C>         <C>       <C>           <C>         <C>            <C>
Issue of common stock upon
  exercise of warrants                  1   1,250,000           -        -            34           -              -         35

Issue of common stock upon
  exercise of options                   1   1,100,000           -        -           274           -              -        275

Issue of common stock for
  services                              2   1,770,301           -        -           300           -              -        302

Issue of warrants for services          -           -           -        -           162           -              -        162

Issue of preferred stock                -           -           -   15,000         1,061           -              -      1,061

Conversion of preferred stock
  to common stock                      16  16,501,251           -  (14,240)          (16)          -              -          -

Dividends declared on preferred
  stock                                 -           -           -        -             -           -           (135)      (135)

Issue of common stock as payment
  of dividends on preferred
  stock                                 1     840,383           -        -            64           -              -         65

Conversion of note payable to
  shareholder to common stock           4   4,210,526           -        -           439           -              -        443

Issue of common stock for cash          -      27,500           -        -             6           -              -          6

Net loss accumulated in 2001            -           -           -        -             -           -         (2,842)    (2,842)
                                  -------  ----------  ----------  --------  ------------  ----------  -------------  ---------

Balance at June 30, 2001          $    40  40,253,331  $        -   15,760   $     8,121   $     (17)  $     (8,729)  $   (585)
                                  =======  ==========  ==========  ========  ============  ==========  =============  =========
</TABLE>


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


                                       F-7
<PAGE>
<TABLE>
<CAPTION>
                                   ENDOVASC LTD., INC.
                        (A CORPORATION IN THE DEVELOPMENT STAGE)
                                 STATEMENT OF CASH FLOWS
                     FOR THE YEARS ENDED JUNE 30, 2001 AND 2000, AND
             FOR THE PERIOD FROM INCEPTION, JUNE 10, 1996, TO JUNE 30, 2001
                                       __________
                                     (IN THOUSANDS)


                                                      YEAR       ENDED
                                                   ----------  ----------    INCEPTION
                                                    JUNE 30,    JUNE 30,    TO JUNE 30,
                                                      2001        2000         2001
                                                   ----------  ----------  -------------
<S>                                                <C>         <C>         <C>
Cash flows from operating activities:
  Net loss                                         $  (2,842)  $  (2,975)  $     (8,594)
  Adjustments to reconcile net loss to net
    cash used in operating activities:
    Common stock and stock options issued
      as compensation for services                       302       1,390          2,589
    Extraordinary loss                                     -         127            127
    Write down of long-lived assets to fair
      value                                                -           -            285
    Depreciation and amortization expense                 54          12             75
    Deferred income tax expense                            -           -              8
    Amortization of discount on convertible
      debentures                                           -         125            250
    Changes in operating assets and liabilities:
      (Increase) decrease in other assets                (11)        (95)          (114)
      Increase (decrease) in accounts payable
        and accrued liabilities                          554        (151)           771
                                                   ----------  ----------  -------------

        Net cash used in operating activities         (1,943)     (1,567)        (4,603)
                                                   ----------  ----------  -------------

Cash flows from investing activities:
  Capital expenditures                                   (84)        (39)          (142)
  Proceeds received from repayment of loan to
    stockholder                                            -           -             72
                                                   ----------  ----------  -------------

        Net cash used in investing activities            (84)        (39)           (70)
                                                   ----------  ----------  -------------

Cash flows from financing activities:
  Proceeds from sale of equity securities                  -           -            337
  Proceeds from sale of common stock                       6           -            212
  Proceeds from exercise of warrants                      35           -              -
  Proceeds from sale of convertible debenture
    and related conversion feature                         -         537          1,037
  Net proceeds from issuance of preferred
    stock                                              1,223       1,040          2,263
  Issuance of notes payable                                -           9            106
  Repayment of notes payable                             (18)        (33)           (64)
  Payments of obligations under capital leases           (23)          -            (23)
  Proceeds from advances from stockholders                 -         859            944
  Repayments of notes to stockholder                      (5)          -             (5)
  Purchase of treasury stock                               -           -            (17)
                                                   ----------  ----------  -------------

        Net cash provided by financing
          activities                                   1,218       2,412          4,790
                                                   ----------  ----------  -------------

Net increase (decrease) in cash and cash
  equivalents                                           (809)        806            117

Cash and cash equivalents at beginning of
  period                                                 926         120            - _
                                                   ----------  ----------  -------------

Cash and cash equivalents at end of period         $     117   $     926   $        117
                                                   ==========  ==========  =============

Supplemental disclosure of cash flow information:

  Cash paid for interest expense                   $      18   $       8   $         98
                                                   ==========  ==========  =============

  Cash paid for income taxes                               -   $       -   $        - _
                                                   ==========  ==========  =============
</TABLE>


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


                                       F-8
<PAGE>
                               ENDOVASC LTD., INC.
                    (A CORPORATION IN THE DEVELOPMENT STAGE)
                          NOTES TO FINANCIAL STATEMENTS
                                   __________

1.   ORGANIZATION  AND  SUMMARY  OF  SIGNIFICANT  ACCOUNTING  POLICIES
     -----------------------------------------------------------------

     Endovasc, Ltd., Inc. (the "Company") was incorporated under the laws of the
     State  of  Nevada on June 10, 1996. The Company's principal business is the
     production of various drugs that can be administered using an advanced drug
     delivery  system.  The  Company believes that its drug delivery system will
     ultimately be widely used by cardiologists, interventional radiologists and
     vascular surgeons. The Company is considered a development stage enterprise
     because  it  has  not  yet  generated  significant revenue from sale of its
     products  and  has  devoted  substantially  all  of  its efforts in raising
     capital.

     SIGNIFICANT  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  dates of the
     financial  statements  and  the  reported  amounts of revenues and expenses
     during  the  periods.  Actual results could differ from estimates making it
     reasonably  possible that a change in the estimates could occur in the near
     term.

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

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

     The  Company maintains cash deposits in banks which may occasionally exceed
     the  amount of federal deposit insurance available. Management periodically
     assesses  the financial condition of the institutions and believes that any
     possible  deposit  loss  is  minimal.

     PROPERTY  AND  EQUIPMENT
     ------------------------

     Property  and  equipment  are recorded at cost. Depreciation is provided on
     the  straight-line  method  over  the estimated useful lives of the assets,
     which  range  from five to seven years. Expenditures for major renewals and
     betterments that extend the original estimated economic useful lives of the
     applicable  assets  are  capitalized.  Expenditures  for normal repairs and
     maintenance  are  charged  to  expense  as  incurred.  The cost and related
     accumulated  depreciation  of  assets  sold  or  otherwise  disposed of are
     removed  from the accounts, and any gain or loss is included in operations.

     DEBT  ISSUANCE  COSTS
     ---------------------

     Debt issuance costs are deferred and recognized, using the interest method,
     over  the  term  of  the  related  debt.


                                    Continued
                                       F-9
<PAGE>
                               ENDOVASC LTD., INC.
                    (A CORPORATION IN THE DEVELOPMENT STAGE)
                    NOTES TO FINANCIAL STATEMENTS, CONTINUED
                                   __________

1.   ORGANIZATION  AND  SUMMARY  OF SIGNIFICANT ACCOUNTING POLICIES, CONTINUED
     -------------------------------------------------------------------------

     INCOME  TAXES
     -------------

     The Company uses the liability method of accounting for income taxes. Under
     this  method,  deferred  income  taxes  are  recorded  to  reflect  the tax
     consequences on future years of temporary differences between the tax basis
     of  assets  and  liabilities  and  their financial amounts at year-end. The
     Company  provides  a  valuation  allowance to reduce deferred tax assets to
     their  net  realizable  value.

     RESEARCH  AND  DEVELOPMENT
     --------------------------

     Research  and  development  costs  are  expensed  as  incurred. These costs
     consist  of  direct  and  indirect costs associated with specific projects.

     STOCK-BASED  COMPENSATION
     -------------------------

     Stock-based  compensation is accounted for using the intrinsic value method
     prescribed  in  Accounting  Principles  Board  Opinion  ("APB")  No.  25,
     "Accounting  for  Stock Issued to Employees", rather than applying the fair
     value  method  prescribed  in  SFAS  No.  123,  "Accounting for Stock-Based
     Compensation".

     LOSS  PER  SHARE
     ----------------

     Basic  and  diluted loss per share is computed on the basis of the weighted
     average  number  of  shares of common stock outstanding during each period.
     Common  equivalent  shares  from  common  stock  options  and  warrants are
     excluded from the computation (See Note 9) as their effect would dilute the
     loss  per  share  for  all  periods  presented.

     FAIR  VALUE  OF  FINANCIAL  INSTRUMENTS
     ---------------------------------------

     The  Company  includes  fair  value  information  in the notes to financial
     statements  when  the  fair value of its financial instruments is different
     from  the  book  value.  When  the  book  value approximates fair value, no
     additional  disclosure  is  made.

     IMPAIRMENT  OF  LONG-LIVED  ASSETS
     ----------------------------------

     In  the  event  facts  and  circumstances  indicate the carrying value of a
     long-lived  asset,  including  associated  intangibles, may be impaired, an
     evaluation of recoverability is performed by comparing the estimated future
     undiscounted  cash  flows associated with the asset to the asset's carrying
     amount to determine if a write-down to market value or discounted cash flow
     is  required.


                                    Continued
                                      F-10
<PAGE>
                               ENDOVASC LTD., INC.
                    (A CORPORATION IN THE DEVELOPMENT STAGE)
                    NOTES TO FINANCIAL STATEMENTS, CONTINUED
                                   __________

1.   ORGANIZATION  AND  SUMMARY  OF SIGNIFICANT ACCOUNTING POLICIES, CONTINUED
     -------------------------------------------------------------------------

     RECENT  ACCOUNTING  PRONOUNCEMENTS
     ----------------------------------

     In  December  1999,  the  staff  of  the Securities and Exchange Commission
     released  Staff  Accounting  Bulletin  No.  101  ("SAB  101"),  "Revenue
     Recognition",  to  provide  guidance  on  the recognition, presentation and
     disclosure  of  revenues in financial statements. The Company believes that
     its  revenue recognition practices are in conformity with the guidelines in
     SAB  101,  and  therefore this pronouncement has no impact on its financial
     statements.

     In  March  2000,  the  FASB released Interpretation No. 44, "Accounting for
     Certain Transactions Involving Stock Compensation: An Interpretation of APB
     Opinion  No.  25".  Interpretation No. 44 provides clarification of certain
     issues,  such  as the determination of who is an employee, the criteria for
     determining  whether  a  plan  qualifies  as  a  non-compensatory plan, the
     accounting  consequence  of  various  modifications  to  the  terms  of  a
     previously  fixed  stock option or award and the accounting for an exchange
     of  stock  compensation  awards  in  a  business  combination.  The Company
     believes  that  its  practices  are  in  conformity with this guidance, and
     therefore  Interpretation No. 44 has no impact on its financial statements.

     In  June  2001, the FASB issued Statement of Financial Accounting Standards
     ("SFAS")  141,  "Business  Combinations", and SFAS 142, "Goodwill and Other
     Intangible Assets". SFAS 141 requires business combinations initiated after
     June  30, 2001 to be accounted for using the purchase method of accounting.
     It also specifies the types of acquired intangible assets that are required
     to  be  recognized  and  reported  separately  from goodwill. SFAS 142 will
     require  that  goodwill and certain intangibles no longer be amortized, but
     instead be tested for impairment at least annually. SFAS 142 is required to
     be  applied  starting  with fiscal years beginning after December 15, 2001,
     with early application permitted in certain circumstances. The Company does
     not  expect  these  new  statements  to  have  any  impact on its financial
     statements.


                                    Continued
                                      F-11
<PAGE>
                               ENDOVASC LTD., INC.
                    (A CORPORATION IN THE DEVELOPMENT STAGE)
                    NOTES TO FINANCIAL STATEMENTS, CONTINUED
                                   __________

2.   LICENSE  AGREEMENT
     ------------------

     In  February  2000  the Company entered into an exclusive license agreement
     with  Stanford  University  to  assist  in  the development of the Nicotine
     Receptor  Agonist technology. For the exclusive rights to this license, the
     Company  paid  a non-refundable license fee of $100,000 plus 190,000 shares
     of  the  Company's common stock to Stanford University and the inventors of
     the  technology.  The  term  of the agreement is for 10 years or five years
     from  the  first  commercial  sale  of  a  licensed product by the Company,
     whichever  occurs  first.  The  Company  is  also required to pay an annual
     royalty of $100,000 beginning February 1, 2001 and each year thereafter and
     a  6% royalty on net sales of any licensed product. The Company is required
     to  pay  to  Stanford  an  additional $100,000 upon FDA approval of Phase I
     clinical  trials,  $300,000  upon FDA approval of Phase III clinical trials
     and  $500,000  within  six  months  after  FDA  marketing  approval.

     The  costs  of  obtaining  the  license  of  $162,701  were capitalized and
     included in other assets in the accompanying balance sheet. These costs are
     being  amortized  on  a straight line basis over the term of the agreement.
     Amortization  expense  during  the  year  ended  June 30, 2001 was $17,269.


3.   PROPERTY  AND  EQUIPMENT
     ------------------------

     Property  and  equipment  at  June  30,  2001 consists of the following (in
     thousands):

       Office furniture, fixtures and equipment  $265

       Less accumulated depreciation              (51)
                                                 -----

                                                 $214
                                                 =====


     Depreciation  expense  during  the  year  ended  June 30, 2001 was $37,069.
     Included  in  property  and  equipment  at June 30, 2001 is equipment under
     capital  leases  of  $123,490.


4.   NOTES  PAYABLE
     --------------

     Notes  payable  at  June  30, 2001 consist of the following (in thousands):

     Note  payable  to  a  bank,  bearing  interest  of  8%
       and  due  in  monthly  installments  of  $1,391,
       including  interest,  through  2004.  This  note
       is  uncollateralized  but  is  guaranteed  by  two
       stockholders  of  the  Company.                         $    42


                                    Continued
                                      F-12
<PAGE>
                               ENDOVASC LTD., INC.
                    (A CORPORATION IN THE DEVELOPMENT STAGE)
                    NOTES TO FINANCIAL STATEMENTS, CONTINUED
                                   __________

4.   NOTES  PAYABLE,  CONTINUED
     --------------------------

     Notes payable to financial institutions, bearing
       interest of 9% to 11% and due in individual
       monthly installments of up to $4,056, through
       November 2001 and April 2002.  These notes are
       uncollateralized but are guaranteed by a stock-
       holder of the Company.                              29

     Note payable to stockholder, non-interest
       bearing and due on demand.  This note is
       uncollateralized.                                   99
                                                        ------

         Total notes payable                              170

     Less current maturities                             (142)
                                                        ------

                                                        $  28
                                                        ======


     Future  annual  maturities of notes payable at June 30, 2001 are as follows
     (in  thousands):

     YEAR ENDED
     JUNE 30,    AMOUNT
     ----------  -------
     2002        $   142
     2003             15
     2004             13
                 -------

                 $   170
                 =======


5.   ACCRUED  LIABILITIES
     --------------------

     Accrued  liabilities  at  June  30,  2001  consist  of  the  following  (in
     thousands):

       Accrued payroll and related taxes   $ 19
       Dividends payable                     70
       Other accrued expenses                35
       Accrued legal settlement (Note 10)   408
                                           ----

                                           $532
                                           ====


                                    Continued
                                      F-13
<PAGE>
                                 ENDOVASC LTD., INC.
                    (A CORPORATION IN THE DEVELOPMENT STAGE)
                    NOTES TO FINANCIAL STATEMENTS, CONTINUED
                                   __________


6.   INCOME  TAX
     -----------

     The  composition of deferred tax assets and the related tax effects at June
     30,  2001  are  as  follows  (in  thousands):

       Benefit from carryforward of net
         operating losses                $ 1,666

       Less valuation allowance           (1,666)
                                         --------

         Net deferred tax asset          $   - _
                                         ========


     The difference between the income tax benefit in the accompanying statement
     of  operations  and  the  amount  that  would  result  if  the U.S. Federal
     statutory  rate  of  34%  were  applied  to  pre-tax loss is as follows (in
     thousands):

                                         2001                    2000
                                  ----------------------  ----------------------
                                             PERCENTAGE              PERCENTAGE
                                             OF PRE-TAX              OF PRE-TAX
                                   AMOUNT       LOSS       AMOUNT       LOSS
                                  --------  ------------  --------  ------------
       Benefit for income tax at
         federal statutory rate   $   966          34.0%  $ 1,012          34.0%
       Non-deductible expenses       (243)         (8.6)     (473)        (15.9)
       Increase in valuation
         allowance                   (723)        (25.4)     (539)        (18.1)
                                  --------  ------------  --------  ------------

         Total                    $     -   $         -%  $     -             -%
                                  ========  ============  ========  ============


     The  non-deductible  expenses  relate  primarily  to the issuance of common
     stock  for services using different valuation methods for financial and tax
     reporting  purposes.

     At  June  30,  2001,  for  federal  income  tax and alternative minimum tax
     reporting  purposes, the Company has approximately $4,900,000 of unused net
     operating  losses  available  for carryforward to future years. The benefit
     from carryforward of such net operating losses will expire in various years
     between  2016  and  2020  and  could  be  subject  to severe limitations if
     significant  ownership  changes  occur  in  the  Company.


                                    Continued
                                      F-14
<PAGE>
                               ENDOVASC LTD., INC.
                    (A CORPORATION IN THE DEVELOPMENT STAGE)
                    NOTES TO FINANCIAL STATEMENTS, CONTINUED
                                   __________


7.   STOCK  OPTIONS  AND  WARRANTS
     -----------------------------

     The Company periodically issues incentive stock options and warrants to key
     employees,  officers,  directors  and  outside  consultants  to  provide
     additional  incentives to promote the success of the Company's business and
     to  enhance  the  ability  to  attract and retain the services of qualified
     persons.  The  issuance  of  such  options  are  approved  by  the Board of
     Directors. The exercise price of an option or warrant granted is determined
     by  the  fair  market  value  of  the  stock  on  the  date  of  grant.

     During  the  year  ended  June 30, 1998, the Company granted stock options,
     with  a  term  of  three  years,  to  acquire up to 1,350,000 shares of the
     Company's  restricted  common  stock  at  $0.25  to  $0.75 per share, which
     approximated  market  value  at  the  date  of  grant.

     During  the  year ended June 30, 1999, the Company granted stock options to
     acquire  up  to  250,000  shares  of the Company's restricted common stock.
     These  stock options have a three year term and exercise prices of $0.40 to
     $0.75  per  share,  which  approximated  market  value  at  date  of grant.

     During  the  year ended June 30, 2000, the Company issued stock warrants to
     acquire  332,778  shares of the Company's common stock to certain companies
     for their role in the completion of the Company's preferred stock offering.
     These  warrants  have  a three year term and an exercise price of $1.89 per
     share,  which  approximated  market  value at the date of grant. During the
     years  ended June 30, 2000 and 2001, the Company also issued stock warrants
     to  acquire  500,000  and  1,000,000 shares, respectively, of the Company's
     common  stock  to  a  company  as  a  finder's fee for the placement of the
     preferred  stock  offering.  The  warrants  have  a  five  year term and an
     exercise  price  of  $0.10  and  $0.01  per  share, respectively. The costs
     associated with these stock warrants did not effect the Company's statement
     of  operations  as  all costs were offset against the offering proceeds and
     recorded  through  stockholders'  equity.

     To  provide  incentives to consultants and employees, on December 13, 2000,
     the  Company granted options, with a term of 3 years, to purchase 1,325,500
     shares of the Company's common stock at a price ranging from $0.40 to $1.00
     per  share,  which  was  greater  than the market price of the stock at the
     grant  date.

     During  the  year  ended  June  30, 2001, 1,250,000 shares of the Company's
     common  stock  were  issued  due  to the exercise of warrants. In addition,
     1,100,000  shares  of common stock were issued due to the exercise of stock
     options,  of  which  1,000,000  of  the  shares  was  paid  for through the
     reduction  in  the  note  payable  to  stockholder.


                                    Continued
                                      F-15
<PAGE>
                                 ENDOVASC LTD., INC.
                    (A CORPORATION IN THE DEVELOPMENT STAGE)
                    NOTES TO FINANCIAL STATEMENTS, CONTINUED
                                   __________


7.   STOCK  OPTIONS  AND  WARRANTS,  CONTINUED
     -----------------------------------------

     The  Company  has  issued  stock  options  to  employees  and  non-employee
     consultants  as  follows  (in  thousands,  except  for  per  share  data):

<TABLE>
<CAPTION>
                                                                            WEIGHTED
                       NUMBER OF SHARES                                      AVERAGE
                     --------------------
                                  NON-              EXERCIS-    EXERCISE    EXERCISE
                     EMPLOYEE   EMPLOYEE    TOTAL     ABLE        PRICE       PRICE
                     ---------  ---------  -------  ---------  -----------  ---------
<S>                  <C>        <C>        <C>      <C>        <C>          <C>
Options outstanding
  at June 30, 1999      1,600        600    2,200      1,550   $0.10-$0.75  $    0.30

Options granted             -          -        -          -

Options exercised        (600)         -     (600)         -   $      0.10  $    0.10
                     ---------  ---------  -------  ---------  -----------  ---------

Options outstanding
  at June 30,2000       1,000        600    1,600      1,550   $0.25-$0.75  $    0.38

Options granted           351        975    1,326          -   $0.40-$1.00  $    0.42

Options exercised      (1,000)      (100)  (1,100)    (1,100)  $0.25-$0.40  $    0.26

Options expired             -       (350)    (350)      (300)  $0.40-$0.75  $    0.61
                     ---------  ---------  -------  ---------

Options outstanding
  at June 30, 2001        351      1,125    1,476        150   $0.40-$1.00  $    0.46
                     =========  =========  =======  =========
</TABLE>


Following  is  a  summary  of  outstanding  options  at  June  30,  2001:

     NUMBER OF SHARES  VESTED  EXPIRATION DATE  EXERCISE PRICE
     ----------------  ------  ---------------  ---------------
                  150     150  October, 2001    $          0.75
                1,276       -  December, 2003              0.40
                   50       -  December, 2003              1.00
     ----------------  ------

                1,476     150
     ================  ======


                                    Continued
                                      F-16
<PAGE>
                               ENDOVASC LTD., INC.
                    (A CORPORATION IN THE DEVELOPMENT STAGE)
                    NOTES TO FINANCIAL STATEMENTS, CONTINUED
                                   __________

7.   STOCK  OPTIONS  AND  WARRANTS,  CONTINUED
     -----------------------------------------

     During  the  year  ended  June  30, 2001 and 2000, the Company issued stock
     warrants  to  certain companies in payment of stock offering costs, some of
     which  were  subsequently  exercised,  as  follows  (in  thousands):

                                                                  WEIGHTED
                                                                   AVERAGE
                              NUMBER OF   EXERCIS-    EXERCISE    EXERCISE
                                SHARES       ABLE        PRICE       PRICE
                              ----------  ---------  -----------  ---------
     Warrants issued                833        833   $0.10-$1.89  $    0.82

     Warrants cancelled               -          -             -          -

     Warrants exercised               -          -             -          -
                              ----------  ---------

     Warrants outstanding at
       June 30, 2000                833        833   $0.10-$1.89  $    0.82

     Warrants issued              1,000      1,000   $      0.01  $    0.01

     Warrants cancelled               -          -             -          -

     Warrants exercised          (1,250)    (1,250)  $0.01-$0.10  $    0.03
                              ----------  ---------

     Warrants outstanding at
       June 30, 2001                583        583   $0.10-$1.89  $    1.12
                              ==========  =========


     The  Company  has elected to follow Accounting Principles Board Opinion No.
     25,  "Accounting  for  Stock  Issued  to  Employees"  (APB  25) and related
     Interpretations  in  accounting  for its employee stock options because, as
     discussed  below,  the alternative fair value accounting provided for under
     FASB Statement No. 123, "Accounting for Stock-Based Compensation", requires
     use  of  option valuation models that were not developed for use in valuing
     employee  stock  options.

     Proforma  information  regarding  net  income  and  earnings  per  share is
     required  by  Statement  No. 123, and has been determined as if the Company
     had accounted for its employee stock options under the fair value method of
     that  Statement. The fair value for these options was estimated at the date
     of  grant  using  a  Black-Scholes  option pricing model with the following
     weighted-average  assumptions for 2001 and 2000: risk-free interest rate of
     5%;  no  dividend yield; weighted average volatility factor of the expected
     market  price of the Company's common stock of 0.70; and a weighted-average
     expected  life  of  the  options  of  3  years.


                                    Continued
                                      F-17
<PAGE>
                               ENDOVASC LTD., INC.
                    (A CORPORATION IN THE DEVELOPMENT STAGE)
                    NOTES TO FINANCIAL STATEMENTS, CONTINUED
                                   __________

7.   STOCK  OPTIONS  AND  WARRANTS,  CONTINUED
     -----------------------------------------

     The  Black-Scholes  option  valuation  model  was  developed  for  use  in
     estimating  fair value of traded options which have no vesting restrictions
     and  are  fully  transferable. In addition, option valuation models require
     the  input  of  highly  subjective assumptions including the expected stock
     price  volatility. Because the Company's stock options have characteristics
     significantly  different  from those of traded options, and because changes
     in  the  subjective  input assumptions can materially affect the fair value
     estimate,  in  management's opinion, the existing models do not necessarily
     provide  a  reliable single measure of the fair value of its stock options.

     For  purposes  of  proforma  disclosures,  the  estimated fair value of the
     options  is  included  in  expense  at  the date of issuance. The Company's
     proforma  information  is as follows (in thousands, except per share data):

                                                   2001      2000
                                                 --------  --------
     Net loss available to common stockholders   $(2,842)  $(2,975)

     Proforma net loss available to common
       stockholders                              $(2,992)  $(2,975)

     Proforma basic and dilutive loss per share  $ (0.17)  $ (0.31)


8.   PREFERRED  STOCK
     ----------------

     The  Company's  articles  of  incorporation authorize the issuance of up to
     20,000,000 shares of preferred stock with characteristics determined by the
     Company's board of directors. Effective May 5, 2000, the board of directors
     authorized  the  issuance  and  sale  of up to 55,000 shares of Series A 8%
     convertible  preferred  stock.

     On  May  9,  2000, the Company issued 15,000 shares of $0.001 par value and
     $100  per  share  liquidation  value  Series  A  8%  non-voting convertible
     preferred stock for $1,500,000. The actual proceeds received by the Company
     were  $1,040,300,  which are net of related offering costs. During the year
     ended  June 30, 2001, the Company issued an additional 15,000 shares of the
     Series  A  preferred  stock for cash proceeds to the Company of $1,223,247,
     which  is  net  of  related  offering  costs  of $276,753. In addition, the
     Company  issued  as a finders fee, warrants to purchase 1,000,000 shares of
     common  stock  at  $0.01  per  share, which resulted in additional offering
     costs  of  $162,000.


                                    Continued
                                      F-18
<PAGE>
                               ENDOVASC LTD., INC.
                    (A CORPORATION IN THE DEVELOPMENT STAGE)
                    NOTES TO FINANCIAL STATEMENTS, CONTINUED
                                   __________

8.   PREFERRED  STOCK,  CONTINUED
     ----------------------------

     The  Series  A convertible preferred stock can be converted to common stock
     at  any time at the option of the holder. The conversion rate is the stated
     value per share plus any accrued and unpaid dividends divided by 85% of the
     average  of  the  three  lowest  closing bid prices of the Company's common
     stock for the thirty trading days immediately preceding May 9, 2000, or 70%
     of  the  average of the three lowest closing bid prices for the thirty days
     immediately  preceding  the  conversion  date  of  the respective preferred
     stock.  During  the  year  ended  June 30, 2001, 14,240 shares of preferred
     stock  were  converted  to  16,501,251  shares  of  common  stock.

     In  addition, the Series A preferred stockholders were originally obligated
     to  purchase  an  additional  30,000  shares,  of  which 15,000 shares were
     purchased  during  the year ended June 30, 2001, of Series A 8% convertible
     preferred  stock  at  the  option  of  the Company subject to the Company's
     compliance  with  various  covenants.  The  Company has violated certain of
     these  covenants  but  the  stockholders  retain  the  right  to  waive any
     violations.  The  purchase  price  of  additional shares is $100 per share.

     If  the  conversion  price  is  lower than the initial price at the date of
     issue, the Company has the right to redeem the shares of Series A preferred
     stock  at  130%  of  its  liquidation  value  per  share.


9.   LOSS  PER  COMMON  SHARE
     ------------------------

     The  following  table  sets  forth the computation of basic and diluted net
     loss  per  common  share  (in  thousands,  except  share  data):

                                                         2001         2000
                                                     ------------  -----------

     Basic loss per common share:
       Net loss before extraordinary item            $    (2,842)  $   (2,848)
       Extraordinary item                                      -         (127)
       Preferred stock dividends                            (135)           -
                                                     ------------  -----------

         Net loss available for common shareholders  $    (2,977)  $   (2,975)
                                                     ============  ===========


       Weighted average common shares outstanding     17,269,229    9,575,153
                                                     ============  ===========

       Basic net loss per common share before
         extraordinary item                          $     (0.17)  $    (0.30)
       Extraordinary item                                      -        (0.01)
                                                     ------------  -----------

         Basic net loss per common share             $     (0.17)  $    (0.31)
                                                     ============  ===========


                                    Continued
                                      F-19
<PAGE>
                               ENDOVASC LTD., INC.
                    (A CORPORATION IN THE DEVELOPMENT STAGE)
                    NOTES TO FINANCIAL STATEMENTS, CONTINUED
                                   __________

9.   LOSS  PER  COMMON  SHARE
     ------------------------

Diluted loss per common share:
       Net loss before extraordinary item           $    (2,842)  $   (2,848)
       Extraordinary item                                   - _         (127)
                                                    ------------  -----------

         Net loss available to common shareholders  $    (2,842)  $   (2,975)
                                                    ============  ===========

       Weighted average shares outstanding           17,269,229    9,575,153
                                                    ============  ===========

       Fully diluted net loss per common share
         before extraordinary item                  $     (0.16)  $    (0.30)
       Extraordinary item                                  -  -        (0.01)
                                                    ------------  -----------

         Fully diluted net loss per common share    $     (0.16)  $    (0.31)
                                                    ============  ===========


10.  COMMITMENTS  AND  CONTINGENCIES
     -------------------------------

     The  Company  was  named  as a defendant in a civil lawsuit styled David F.
     Miller  v. Endovasc Ltd., Inc. The plaintiff claimed damages as a result of
     an  alleged breach of a consulting contract with the Company. A bench trial
     was  held on May 14, 2001. On June 15, 2001, a judgment was entered against
     the  Company  in  the  amount  of  $3,240,000  plus  pre- and post-judgment
     interest.  The  Company  filed  a  motion  for a new trial, and the parties
     participated  in  mediation prior to a ruling on the Company's motion for a
     new  trial.  The mediation resulted in a settlement, which was entered into
     the  Court  records  on August 10, 2001. As a result of the settlement, the
     Company  issued 8,000,000 free-trading shares of the Company's common stock
     in  the  name  of  the  plaintiff,  based on an exemption from registration
     provided  by Section 3(a)(10) of the Securities Act of 1933 as amended. The
     settlement  terminated  all  disputes  of any kind between the parties, and
     also  terminated  a  related  matter styled David F. Miller v. Gary Ball. A
     liability, based on the fair market value of the 8,000,000 shares of common
     stock  issued,  of  $408,000 is included in accrued liabilities at June 30,
     2001.

     The  Company is subject to certain other legal proceedings and claims which
     arose in the ordinary course of its business. In the opinion of management,
     the  amount  of  ultimate  liability with respect to these actions will not
     materially  affect  the  financial  position, results of operations or cash
     flows  of  the  Company.

     The  Company  has  entered into a one-year lease agreement for office space
     which  is  accounted  for as an operating lease. Rent expense for the years
     ended  June  30,  2001  and  2000 was $21,000 and $17,250, respectively. In
     addition, the Company leases equipment under capital leases which expire at
     various dates through 2006. Future minimum lease payments having initial or
     noncancellable  lease  terms  in  excess  of  one  year  are  as  follows:

                                    Continued
                                      F-20
<PAGE>
                               ENDOVASC LTD., INC.
                    (A CORPORATION IN THE DEVELOPMENT STAGE)
                    NOTES TO FINANCIAL STATEMENTS, CONTINUED
                                   __________

10.  COMMITMENTS  AND  CONTINGENCIES,  CONTINUED
     -------------------------------------------

                                               CAPITAL
                                                    LEASES
                                                   ---------
     2002                                          $     58
     2003                                                54
     2004                                                25
     2005                                                 9
     2006                                                 5
                                                   ---------

     Total payments                                     151
     Less amount representing interest                  (42)
                                                   ---------

     Present value of minimum lease payments  109
     Less current portion                               (35)
                                                   ---------

     Obligations under capital lease, net of
       current portion                             $     74
                                                   =========


11.  GOING  CONCERN  CONSIDERATIONS
     ------------------------------

     Since its inception, as a development stage enterprise, the Company has not
     generated  significant  revenue  and  has been dependent on debt and equity
     raised from individual investors to sustain its operations. The Company has
     conserved  cash  by  issuing  its  common  stock to satisfy obligations, to
     compensate individuals and vendors and to settle disputes that have arisen.
     However,  during  the  years  ended  June  30,  2001  and 2000, the Company
     incurred  net losses (in thousands) of $(2,842) and $(2,975), respectively,
     and  negative  cash  flows  from  operations  of  $(1,943)  and  $(1,567),
     respectively.  These  factors  along with a $(841) negative working capital
     position  at  June  30,  2001  raise  substantial doubt about the Company's
     ability  to  continue  as  a  going  concern.

     Management  plans to take specific steps to address its difficult financial
     situation  as  follows:

     -    In  the  near  term,  the  Company plans to receive a sum total not to
          exceed  $512,000  from  a  third-party  sponsor  for  the  purpose  of
          agreed-upon  research.

     -    In  the  near  term the Company plans additional private sales of debt
          and  common  and  preferred  stock  to qualified investors to fund its
          current  operations.

     -    In  the  intermediate term, the Company plans a public registration of
          its  common  stock  under  the  Securities and Exchange Act of 1933 to
          provide  a  means  of expanding the market for its common stock and to
          provide a means of obtaining the funds necessary to bring its products
          to  the  commercial  market.


                                    Continued
                                      F-21
<PAGE>
                               ENDOVASC LTD., INC.
                    (A CORPORATION IN THE DEVELOPMENT STAGE)
                    NOTES TO FINANCIAL STATEMENTS, CONTINUED
                                   __________


11.  GOING  CONCERN  CONSIDERATIONS,  CONTINUED
     ------------------------------------------

     -    In  the  long-term,  the  Company  believes  that  cash  flows  from
          commercialization  of  its  products  will  provide  the resources for
          continued  operations.

     There  can be no assurance that the Company's planned private sales of debt
     and  equity  securities  or its planned public registration of common stock
     will  be  successful  or  that  the  Company  will  have  the  ability  to
     commercialize  its  products  and  ultimately  attain  profitability.  The
     Company's  long-term  viability  as a going concern is dependent upon three
     key  factors,  as  follows:

     -    The  Company's  ability  to  obtain adequate sources of debt or equity
          funding  to meet current commitments and fund the commercialization of
          its  products.

     -    The  ability  of  the  Company  to obtain positive test results of its
          products  in  clinical  trials.

     -    The  ability  of  the  Company  to  ultimately  achieve  adequate
          profitability  and  cash  flows  to  sustain  its  operations.


12.  NON-CASH  INVESTING  AND  FINANCING  ACTIVITIES
     -----------------------------------------------

     During  the  years  ended  June  30,  2001  and 2000, and for the period of
     inception,  June  10,  1996 to June 30, 2001 the Company engaged in certain
     non-cash  investing  and  financing  activities  as follows (in thousands):

                                                    INCEPTION
                                           2001   2000    TO DATE
                                           -----  -----  ----------
     Common stock issued in exchange for
       equity securities                   $   -  $   -  $      302
                                           =====  =====  ==========

     Common stock issued upon conversion
       of debentures                       $   -  $ 842  $    1,289
                                           =====  =====  ==========

     Common stock issued for services and
       license and patent rights           $ 302  $  63  $    2,936
                                           =====  =====  ==========

     Common stock issued in settlement of
       lawsuit and related liabilities     $   -  $ 193  $      193
                                           =====  =====  ==========

     Warrants issued for services          $ 162  $ - _  $      162
                                           =====  =====  ==========


                                    Continued
                                      F-22
<PAGE>
                               ENDOVASC LTD., INC.
                    (A CORPORATION IN THE DEVELOPMENT STAGE)
                    NOTES TO FINANCIAL STATEMENTS, CONTINUED
                                   __________


12.  NON-CASH  INVESTING  AND  FINANCING  ACTIVITIES,  CONTINUED
     -----------------------------------------------------------

Conversion of note payable to share-
       holder to common stock              $443  $148  $591
                                           ====  ====  ====

     Conversion of dividends payable to
       common stock                        $ 65  $  -  $ 65
                                           ====  ====  ====

     Reduction of note payable to stock-
       holder and accrued liabilities
       through exercise of stock options   $275  $  -  $275
                                           ====  ====  ====

     Issuance of notes payable for
       insurance                           $ 37  $  -  $ 37
                                           ====  ====  ====

     Issuance of notes payable for the
       purchase of equipment               $124  $  -  $124
                                           ====  ====  ====


13.  401(K)  PLAN
     ------------

     The  Endovasc Ltd., Inc. 401(k) Plan (the "Plan"), which was implemented in
     June  2001,  covers  all  of  the Company's employees who are United States
     citizens,  at  least 21 years of age and have completed at least six months
     of  service  with the Company. Pursuant to the Plan, employees may elect to
     reduce  their  current  compensation  by  up  to the statutorily prescribed
     annual limit and have the amount of such reduction contributed to the Plan.
     The  Plan  provides  for the Company to make discretionary contributions as
     authorized  by  the  board  of directors; however, no Company contributions
     have  been  made  as  of  June  30,  2001.


14.  SUBSEQUENT  EVENTS
     ------------------

     The  Company  entered  into  an agreement to acquire Intermed 2000, Inc., a
     life science company with headquarters in Israel. The potential acquisition
     is  subject  to a number of conditions, including a due diligence review by
     both  companies.

     Subsequent  to  June 30, 2001, the board of directors approved the purchase
     by  the  Company  of  up  to  1,400,000  shares  of  its  common  stock.


                                      F-23
<PAGE>