U.S. SECURITIES AND EXCHANGE COMMISSION
                            Washington, D.C. 20549

                                  FORM 10-QSB

  (Mark One)
       (X)  QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
       EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED DECEMBER 31,
       1999

                                       OR

       ( )  TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
       EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM _____________
       TO   _____________


                        Commission File Number 0-11472

                             BIOMUNE SYSTEMS, INC.
        (Exact name of small business issuer as specified in its charter)



         Nevada                                   87-0380088
  (State or other jurisdiction of           (I.R.S. Employer Identification No.)
   incorporation or organization)



  2401 South Foothill Drive
  Salt Lake City, Utah                                                84109-1405
  (Address of principal executive offices)                            (Zip Code)

                                 (801) 466-3441
                          (Issuer's telephone number)





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

  As of February 9, 2000, the issuer had issued and outstanding 4,999,312 shares
  of common stock, par value $.0001.

                                        1
<PAGE>


                                TABLE OF CONTENTS



PART I.   FINANCIAL INFORMATION
                                                                            Page
                                                                             No.

     1.   Financial Statements

          Unaudited  Condensed  Consolidated  Balance  Sheets as of December 31,
          1999 and September 30, 1999 . . . . . . . . . . . . . . . . . . . . .3

          Unaudited Condensed Consolidated Statements of Operations for
          the three months ended December 31, 1999 and 1998 . . . . . . . . . .4

          Unaudited Condensed Consolidated Statements of Cash Flows for
          the three months ended December 31, 1999 and 1998 . . . . . . . . . .5

          Notes to Unaudited Condensed Consolidated Financial Statements. . . .7

     2.   Management's Discussion and Analysis or Plan of Operation . . . . . 11


PART II.  OTHER INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . 13


                                        2
<PAGE>


                                     PART I

 ITEM 1 - Financial Statements

                    BIOMUNE SYSTEMS, INC. AND SUBSIDIARIES
                    CONDENSED CONSOLIDATED BALANCE SHEETS
                                  (Unaudited)

ASSETS
<TABLE>
<CAPTION>

                                                                         Dec. 31,      Sep. 30,
                                                                           1999          1999

Current assets:
<S>                                                                     <C>           <C>
  Cash and cash equivalents                                             $1,123,000    $        -
  Receivables, net                                                         253,716       483,995
  Inventories, net                                                         205,785       255,992
  Prepaids                                                                 343,088       306,638
                                                                        ----------    ----------
Total current assets                                                     1,925,589     1,046,625

Long-term Receivables, net                                                 300,000       534,468
Property and equipment, net                                                 67,070        82,805
Investments                                                              2,019,410     1,977,026
Intangibles, net                                                           320,877       554,081
Other assets, net                                                           26,925        11,346
                                                                        ----------    ----------
       Total assets                                                     $4,659,871    $4,206,351
</TABLE>

                    LIABILITIES AND SHAREHOLDERS' EQUITY

<TABLE>
<CAPTION>

Current liabilities:
<S>                                                                     <C>           <C>
  Accounts payable and accrued expenses                                 $   451,580   $   628,230
  Notes Payable                                                             385,000       435,000
           Total current liabilities                                        836,580     1,063,230
Shareholders' equity:
    Preferred stock,  $.0001 par value; 50,000,000 shares authorized
    1,360,430 shares and 1,360,430 shares issued and outstanding
    respectively                                                          1,255,044     2,174,043

    Common  stock,  $.0001 par value; 500,000,000 shares authorized
    1,339,762 shares and 1,286,662 shares outstanding respectively              515           252
    Additional paid-in capital                                           43,339,878    41,914,343
   Stock subscriptions receivable                                           (55,192)      (55,192)
   Deferred compensation and consulting                                    (181,204)     (202,486)
   Accumulated other comprehensive income (loss)                           (768,200)     (768,200)
   Accumulated deficit                                                  (39,767,550)  (39,919,639)
                                                                         ----------    ----------
           Total shareholders' equity                                     3,823,291     3,143,121
                                                                         ----------    ----------
                                                                        $ 4,659,871   $ 4,206,351
                                                                         ==========    ==========
</TABLE>


  The accompanying notes are an integral part of these condensed consolidated
                                 balance sheets.

                                        3
<PAGE>



                   BIOMUNE SYSTEMS, INC. AND SUBSIDIARIES

                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (Unaudited)


<TABLE>
<CAPTION>

                                                                            For the Three Months
                                                                              Ended Dcember 31,
                                                                            1999         1998
                                                                          --------     --------
<S>                                                                    <C>            <C>
REVENUES                                                               $    143,448   $  1,161,827


OPERATING EXPENSES:
  Cost of revenues                                                           50,207        489,892

  Management, consulting and research fees                                   87,832        199,631

  Other general and administrative                                          118,608        328,405
                                                                       ------------   ------------
         Total operating expenses                                           256,647      1,017,928

INCOME (LOSS) FROM OPERATIONS                                              (113,199)       143,899

OTHER INCOME (EXPENSE):
  Interest income, net                                                        9,713         41,079

   Minority interest                                                        301,775         10,665
  Other, net                                                           ------------   ------------

         Total other income, net                                            311,488         30,414
                                                                       ------------   ------------
NET INCOME (LOSS) FROM CONTINUING OPERATIONS                                198,289        174,313
                                                                       ------------   ------------
NET INCOME (LOSS)                                                           198,289        174,313

Preferred Stock dividends and accretion of
    beneficial conversion feature                                           (46,200)       (56,238)
                                                                       ------------   ------------
NET INCOME (LOSS) APPLICABLE TO COMMON SHARES                          $    152,089   $    118,075
                                                                       ============   ============
NET INCOME (LOSS) PER COMMON SHARE  (basic)                            $       0.06   $       0.09
                                                                       ============   ============
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING
   (basic)                                                                2,697,523      1,331,104
NET INCOME (LOSS) PER COMMON SHARE (fully diluted)                     $       0.04   $       0.05
                                                                       ============   ============
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING                                3,834,523      2,380,758
   (diluted)
</TABLE>



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


                                        4
<PAGE>


                    BIOMUNE SYSTEMS, INC. AND SUBSIDIARIES

                CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                  (Unaudited)
               Increase (Decrease) in Cash and Cash Equivalents
<TABLE>
<CAPTION>

                                                                            For the Three Months
                                                                              Ended December 31,
                                                                            1999             1998
                                                                         ---------        ---------
CASH FLOWS FROM OPERATING ACTIVITIES:
<S>                                                                     <C>           <C>
Net income (loss)                                                       $   198,289   $      174,314

  Adjustments to reconcile net loss to net cash used
in operating activities:

  Gain on disposal of Volu-Sol, Inc.                                              -                -

  Depreciation and amortization                                              39,111           35,612
  Issuance of Common Stock, options and warrants for                              -                -
services                                                                                 -----------
  Amortization of deferred consulting expense                                21,280           38,538

  Cancellation of stock issued to consultants                                     -                -

  Exchange of related-party note receivable                                       -                -

  Changes in assets and liabilities:
  Accounts receivable, net                                                      279          648,656

  Interest receivable                                                             -                -

  Inventories                                                                50,207           81,120

  Advances to related party                                                       -                -

   Prepaid expenses                                                         (36,450)        (135,779)

  Other assets                                                              (15,579)         (13,551)
                                                                                         -----------
  Accounts payable and accrued liabilities                                  176,650          245,112
                                                                                         -----------
  Minority Interest                                                               -           15,083
  Accrued payroll and payroll taxes
    Net cash generated (used) in operating activities                        80,487        1,089,105
                                                                       ------------      -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment                                                -           (5,646)
                                                                       ------------      -----------
Net (advances) repayments from related parties                              230,000          (70,000)
Payments received on notes receivable                                             -                -
Sale of Product Line                                                        862,513                -
Purchase Investments                                                                        (235,000)
                                                                       ------------      -----------
    Net generated (used) cash in investing activities                       230,000         (310,646)
                                                                       ------------      -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Payments on notes payable                                                   (50,000)        (137,172)
                                                                       ------------      -----------
    Net cash provided (used) by financing activities                        (50,000)        (137,172)
                                                                       ------------      -----------
</TABLE>


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


                                        5
<PAGE>



                     BIOMUNE SYSTEMS, INC. AND SUBSIDIARIES

                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                  (Unaudited)

                Increase (Decrease) in Cash and Cash Equivalents
<TABLE>
<CAPTION>

                                                                            For the Three Months
                                                                             Ended December 31,
                                                                            1999           1998
                                                                         ---------      ----------
<S>                                                                    <C>            <C>
NET INCREASE (DECREASE) IN CASH AND CASH
   EQUIVALENTS                                                         $  1,123,000   $  ( 641,287)

CASH AND CASH EQUIVALENTS AT  BEGINNING
   OF THE PERIOD                                                                  -         27,701
                                                                       ------------   ------------
CASH AND CASH EQUIVALENTS AT END OF
   THE PERIOD                                                          $  1,123,000   $    668,988
                                                                       ============   ============
</TABLE>


    SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:

During the three  months ended  December 31, 1998 the Company paid  dividends on
its outstanding  preferred stock by issuing additional shares of preferred stock
totaling $52,285.

The Company  increased common stock and additional paid in capital and decreased
preferred  stock by $17,129 due to the  conversion of preferred  stock to common
stock.

The Company increased  preferred stock and decreased  additional paid in capital
by $3,953 due to the preferred stock beneficial conversion feature.

During the three  months ended  December 31, 1999 the Company paid  dividends on
outstanding  preferred  stock by issuing  additional  shares of preferred  stock
totaling $46,200.

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


                                        6
<PAGE>

                   BIOMUNE SYSTEMS, INC. AND SUBSIDIARIES

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                  (Unaudited)

(1)  PRESENTATION OF CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The  accompanying  interim  condensed   consolidated  financial  statements  are
unaudited and have been prepared  consistent with generally accepted  accounting
principles for interim  financial  information and with the instructions to Form
10-QSB and Item 310(b) of Regulation S-B.  Accordingly,  they do not include all
of the  information  and  footnotes  required by generally  accepted  accounting
principles for complete financial statements. These statements should be read in
conjunction with the audited financial  statements and notes thereto included in
the Company's  annual report on Form 10-KSB for the fiscal year ended  September
30, 1999. Reference to the Company or Biomune includes Biomune Systems, Inc. and
its subsidiaries, Optim Nutrition, Inc. and Rockwood Companies, LLC.

In the opinion of management,  the accompanying unaudited condensed consolidated
financial  statements  contain  all  adjustments   (consisting  only  of  normal
recurring  adjustments)  necessary  to fairly  present the  Company's  financial
position as of December  31, 1999 and the results of  operations  and cash flows
for the three months ended  December  31, 1999 and 1998.  The interim  financial
statements should be read in conjunction with the following  explanatory  notes.
The results of operations  for the three months ended  December 31, 1999 are not
necessarily  indicative  of the results that may be expected for the year ending
September 30, 2000.

(2) DIVESTITURE OF VOLU-SOL, INC.

On October 1, 1997, the Company  divested itself of its wholly owned  subsidiary
Volu-Sol,  Inc.,  by  distributing  the common stock of Volu-Sol  prorata to the
Company's  stockholders  of record as of March 5, 1997.  The operations of Volu-
Sol, Inc. are reflected  herein as discontinued  operations  during the affected
period.

(3)  NET INCOME (LOSS) PER COMMON SHARE

Basic net income (loss) per common share ("Basic EPS") excludes  dilution and is
computed by dividing net income (loss) by the weighted  average number of common
shares outstanding during the period. Diluted net income (loss) per common share
("Diluted  EPS")  reflects  the  potential  dilution  that could  occur if stock
options or other contracts to issue common stock including convertible preferred
stock were exercised or converted into common stock.  The computation of Diluted
EPS does not assume  exercise or  conversion  of  securities  that would have an
anti- dilutive effect on net income per common share.

At December 31, 1999,  there were  outstanding  options and warrants to purchase
956,980  shares of common stock and there were 36,003 shares of preferred  stock
outstanding, convertible into a minimum of 856,005 shares of common stock.


                                        7
<PAGE>
<TABLE>
<CAPTION>

                                                Convertible
                         Number of                   into #
Preferred Stock          Preferred Shares     of Common Shares
<S>                                <C>                 <C>
Series A                              935                1,205

Series J                            1,068              854,800
                                ---------            ---------
                                   36,003              856,005
                                =========            =========
</TABLE>


(4)  COMMON STOCK TRANSACTIONS

The Company has  deferred  consulting  expense  related to shares  issued  under
consulting  agreements  entered into prior to September 30, 1999. These deferred
amounts are being  recognized  over the terms of the  agreements as services are
provided.  Total amortization of these deferred  consulting expenses was $21,280
for the three months ended December 31, 1999.

(5)  STOCK OPTIONS AND WARRANTS

During the three months ended  December  31,  1999,  consultants  of the Company
exercised 180,000 options at $1.00 per share. Also during the three months ended
December 31, 1999, the Company's President and Chief Executive Officer exchanged
a $15,000 loan to the Company into 30,000 shares of common stock.

(6)  RELATED-PARTY TRANSACTIONS

During the quarter ended  December 31, 1998,  the Company  recorded a management
fee of $225,000 from its Rockwood subsidiary.

(7)  PREFERRED STOCK TRANSACTIONS

During the three months ended December 31, 1999, the Company  accrued  dividends
on its  outstanding  Series A, Series F and Series J Preferred  stock of $2,625,
$15,200 and $28,375,  respectively.  Preferred  stock  dividends  are payable in
either  additional shares of preferred stock (of the same series) or in cash, at
the option of the Board of Directors. On December 31, 1999, accrued dividends on
Series A, E, F and J Preferred stock totaling $46,200,  were paid by issuing 650
shares of Series A Preferred  stock,  25,333 shares of Series F Preferred  stock
and 28.4 shares of Series J Preferred stock.

During  the three  months  ended  December  31,  1999,  1,443,622  shares of the
Company's preferred stock was converted into 1,905,624 shares of common stock.

(8)  ROCKWOOD TRANSACTION

In April 1998,  the Company  acquired a  controlling  (52%)  equity  interest in
Rockwood's successor, Rockwood Companies LLC (referred to as "Rockwood LC"), for
$360,000 cash, a commitment to issue 500,000 shares of preferred  stock (payable
if certain  benchmarks in sales are obtained),  and covenants on the part of the
Company to loan  $1,500,000  to  Rockwood LC or its  affiliates  over a one-year
period.  Rockwood LC  distributes  and sells health and beauty aids to wholesale
and retail  chains.  Rockwood LC  retained  the right to redeem a portion of the
Company's member interest if the Company fails to keep its covenants to make the
loans to Rockwood  LC.


                                        8
<PAGE>

As of December  31,  1998,  the Company had not  advanced $850,000 of the funds
it had  covenanted to loan to Rockwood LC. By letter dated March 15, 1999
Rockwood  exercised its right to reduce  the  Company's  interest to 19% and to
terminate,  effective  December 31, 1998, other on-going  commitments and
agreements between the Company and Rockwood.

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

     The following  discussion  should be read in conjunction with the unaudited
condensed  consolidated  financial  statements  and the notes thereto  appearing
elsewhere in this Quarterly Report on Form 10-QSB.

Overview

     The Company is engaged in the research, development,  distribution and sale
of  biologic   pharmaceutical   products,   nutraceutical   food   products  and
supplements, medical foods and health and beauty aids. Certain of these products
have been  developed  by the Company and  incorporate  a patented  whey  protein
technology,  which is designed to provide or increase protective immunities from
an immune response to disease and to provide nutritional supplementation.  Until
January  2000,  the  Company  marked a  medical  food bar  patented  formulation
developed  by  researchers  at Beth Israel  Deaconess  Medical  Center,  Harvard
Medical School,  under an exclusive  license.  The Company acquired and sold the
patent rights following the period covered by this report. The energy and sports
nutrition bars of the Company are also marketed under an exclusive  license from
the developer of the products.  Through a majority owned subsidiary, the Company
also  distributes  health and  beauty  aids and  related  products  to  national
wholesale and retail customers.

     The Company  believes its future results of operations  will be affected by
factors such as:

          .       the availability of cash from financing activities to fund its
                  operations;

          .       the  results of  research  and  development  efforts and the
                  clinical trials on BWPT-301,  BWPT-302 and other future
                  pharmaceutical drug candidates based on or derived from the
                  Technology;

          .       market acceptance of Optimune, the nutrition bars, and
                  pharmaceutical drug candidates;

          .       increased competitive pressures;

          .       changes in raw material sources and costs; and

          .       adverse changes in general economic conditions in any market
                  in which the Company conducts or markets its products.

     The Company  believes  that the majority of its future  revenues  will come
from its nutrition  products and new nutraceutical  products and  pharmaceutical
drugs.  The Company cannot  determine the ultimate effect that new products will
have on revenues, earnings or the price of the Company's common stock.



                                        9
<PAGE>

     The  Company's  primary  focus and  efforts  during the  fiscal  year ended
September 30, 1998, were the  commercialization  of its nutraceutical  products,
assessing and obtaining additional  nutraceutical and medical products to add to
product  line,  and, to a lesser  extent,  continuing  its efforts to obtain FDA
approval of BWPT-301 for the treatment of  cryptosporidiosis in people with AIDS
and BWPT-302 for the treatment of E. coli,  strain  0157:H7.  During the quarter
ended December 31, 1998, the Company's  revenues were generated from the sale of
Optimune and Maximune,  special food bars and nutrition bars, and sale of health
and beauty aids through the Company's majority owned Rockwood subsidiary.

     Continuing  in fiscal year 1999,  the Company will focus its  resources and
efforts on:

          .       commercialization of its nutraceutical products;

          .       continued marketing and selling of the NiteBite and Mountain
                  Lift bars;

          .       acquisition of new nutraceutical and or medical food products;

          .       development of one or more additional nutraceutical products
                  based on the Technology; and

          .       approval of BWPT-301 and BWPT-302.

Results of Operations

Comparison of the Three Months Ended December 31, 1999
with the Three Months Ended December 31, 1998

     During the three months ended  December 31, 1999,  the Company had revenues
of $143,448  compared to $1,161,689 for the comparable  three month period ended
December  31,  1998.  The  decrease  in sales is due  primarily  to the  Company
reducing its interest in Rockwood LC from 52% to 19%.

     Cost of sales were  $50,207 for the three  months  ended  December 31, 1999
compared to cost of sales of $489,892  for the same period in 1998.  The overall
gross  margin for the quarter in 1998 was 65% of  revenues,  compared to 58% for
the  comparable  quarter in 1998.  The  increase  in gross  margin is due to the
higher margins from the Company's Optim subsidiary.

     Management,  consulting and research fees were $84,832 for the three months
ended  December  31,  1999,  as compared to $199,632  for the three months ended
December  31, 1998.  The  decrease in fees and expenses is due to the  Company's
efforts to reduce overhead costs.

     During the three  months ended  December  31,  1998,  the Company had a net
profit $174,313  compared to a net profit of $198,289 for the three months ended
December 31, 1999. The increase in net-profit is due to the sale of the NiteBite
product line.

     During the three months ended December 31, 1999,  the Company  entered into
Letters of Intent and Definitive  Agreements with Amerifit  Nutrition,  Inc. and
ICN  Pharmaceutical  for the purchase and sale of the NiteBite product line. The
complicated transaction,  involved among other things, issuing 200,000 shares of
restricted  common  stock to  Amerifit  Nutrition,  Inc.  The net result of this
transaction  was a gain of  $301,775  which  is  recorded  in the  statement  of
operations and other income.

     Net (fully  diluted) income per common share was $(0.05) during the quarter
ended December 31, 1998 compared to net income per common share of $0.04 for the
quarter ended December 31, 1999.


                                       10
<PAGE>

Liquidity and Capital Resources

     Historically,  the Company has been unable to finance its  operations  from
cash  flows from  operating  activities.  The  Company  expects it will  require
substantial  funds and time to  commercialize  its  nutraceutical  products,  to
complete Phase II and Phase III clinical trials on BWPT-301  (assuming  efficacy
is established  during the Phase II clinical trials),  to complete the necessary
clinical   trials  on  BWPT-302  ,  to  obtain   regulatory   approval  for  and
commercialize products utilizing the Technology and to develop and commercialize
additional   nutraceutical   products   based   on   the   Technology.   Because
revenue-generating  operating  activities are not in place at significant levels
and because the Company  will  require  significant  capital to  accomplish  the
objectives  set forth  above,  additional  equity  and/or debt  funding  will be
required,  although such funding may not be available or may not be available on
favorable  terms.  Management  believes  that the  Company-funded  research  and
development  efforts  to date have  positioned  the  Company  to  pursue  future
research  and  development  efforts  and  clinical  trials  with joint  venture,
strategic alliance, government or private grants or other third-party funding.

     As of December  31,  1999,  the Company  had cash and cash  equivalents  of
$1,123,000  and  working  capital of  $1,089,009  as  compared  to cash and cash
equivalents  of $0 and working  capital  deficit of $16,605 as of September  30,
1999.

     The  Series A  Preferred  stock  bears a 10%  cumulative  dividend  payable
annually in cash or in  additional  shares of Series A Preferred  stock,  at the
election of the  Company's  Board of  Directors.  As of December 31,  1999,  the
Company had accrued  dividends on the Series A Preferred stock totaling  $2,650,
which  dividends  the Company  paid in  additional  shares of Series A Preferred
stock.

     During the three months ended  December 31, 1999,  the Company's  operating
activities  generated  $80,487 of cash.  During the same period in the  previous
fiscal year, the Company's operating activities generated $1,089,105 of cash.

     The Company has no established credit facility with a bank of other lending
institution. The Company has in the past, from time to time, borrowed money from
certain shareholders, but there is no formal financing arrangement, agreement or
understanding  in affect with any of its  shareholders  or any other  related or
unrelated party at this time.

Special Statement Concerning Forward-looking Statements

     This Report,  in particular  the  "Management's  Discussion and Analysis or
Plan of Operation" section,  contains forward-looking  statements concerning the
expectations  and  anticipated  operating  results  of  the  Company.  All  such
forward-looking statements contained herein are intended to qualify for the safe
harbor protection provided by Section 21Eof the Securities Exchange Act of 1934,
as amended.  The reader should  understand that numerous  factors govern whether
events  described  by any  forward-looking  statement  made by the Company  will
occur.  Any one of such factors could cause actual results to differ  materially
from those  projected  by the  forward-looking  statements  made in this Report.
These forward-looking  statements include plans and objectives of management for
future operations,  including plans and objectives  relating to the products and
the future economic performance of the Company.


                                       11
<PAGE>

The forward-looking statements and associated risks relate to:

          .     market acceptance of the products;

          .     development of new nutraceutical products;

          .     the extent of additional  research and development,  general
                and  administrative  and other direct costs  associated with
                obtaining final FDA approval on BWPT-301;

          .     the anticipated cost and related expense of the BWPT-301 and
                BWPT- 302 clinical trials until final FDA approval has been
                received;

          .     unexpected delays in receipt of final FDA approval on BWPT- 301;

          .     the estimated commencement date of Phase III clinical trials and
                the completion of those clinical trials on BWPT-301; and

          .     and  the  lack  of  sufficient  cash  to  fund  current  and
                projected  operations and budgeted research and development for
                fiscal year 2000.

     The forward-looking  statements are based on current  expectations that may
be  affected  by a number of risks and  uncertainties  and are based on  certain
assumptions, such as:

          .     the Company will have adequate financing available.

          .     the  efficacy of  BWPT-301  will be  established  during the
                ongoing Phase II clinical trials and the Phase III clinical
                trials;

          .     the Company will be able to successfully undertake and complete
                clinical trials on BWPT-302;

          .     the Company will be able to  successfully  market the health
                and beauty aids and it's the nutraceutical  products, and
                successfully develop and commercialize other nutraceutical
                products;

          .     the Company will be able to successfully develop and
                commercialize the Technology;

          .     the Company will  successfully  conduct  additional Phase II
                clinical  trials on BWPT-301and  may need to conduct  clinical
                trials that are different from those that have been conducted to
                date or that are currently contemplated by the Company; and

          .     the Company will be able to timely and properly quantify and
                analyze the data derived from its clinical trials.

     Assumptions  involve judgments with respect to, among other things,  future
economic,  competitive and market conditions, future business decisions, and the
results of the clinical  trials and the time and money required to  successfully
complete  those  trials,  all of which are  difficult or  impossible  to predict
accurately and many of which are beyond the control of the Company.


                                       12
<PAGE>

Although the Company believes that the assumptions underlying the
forward-looking statements in this Report are reasonable,  any of these
assumptions could prove inaccurate. Therefore, there can be no assurance that
the results contemplated in any of the forward-looking  statements  will be
realized.  Budgeting  and other  management decisions are subjective in many
respects and are susceptible to interpretations and periodic revision based on
actual experience and business developments,  the impact of which may cause the
Company to alter its marketing capital expenditure plans or other budgets. This
will affect the Company's results of operations. In light  of  the  significant
uncertainties  inherent  in  the  forward-looking statements, any such statement
should not be regarded as a representation by the Company or any other person
that the  objectives or plans of the Company will be achieved.

                  PART II.    OTHER INFORMATION

Item 1.   Legal Proceedings

     The Company is party to certain legal proceedings as previously reported in
its public reports filed with the Securities and Exchange Commission.  There has
been no change in these matters since the last report.

Item 6.   Exhibits and Reports on Form 8-K

                    (a)       Exhibits

                    10.118   Contract with Amerifit Nutrition, Inc.

                    10.119   License Agreement

                    10.120   Contract with ICN Pharmaceutical

                    10.121   Schedules to ICN Pharmaceutical Contract

                    10.122   Non-Competition Agreement

                    27       Financial Data Schedule

                                       13
<PAGE>


                                   SIGNATURES

     In accordance  with the  requirements  of the Exchange Act, the  registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.

                                             BIOMUNE SYSTEMS, INC.
                                             (Registrant)


Date: February 18, 2000                      /s/ Michael G. Acton
                                             -----------------------------------
                                             Michael G. Acton,
                                             Chief Executive Officer and
                                             Controller (Principal Financial and
                                             Accounting Officer)