U.S. SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

                                  FORM 10-KSB/A

                                   (Mark One)
   |X| ANNUAL REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT
                                     OF 1934

                  For the seven months ended December 31, 2004

 |_| TRANSITION REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT
                                     OF 1934

                        Commission file number: 333-43126


                          BIOACCELERATE HOLDINGS, INC.
                 (Name of small business issuer in its charter)


                Nevada                                            87-0650219
    -------------------------------                          -------------------
    (State or other jurisdiction of                             (IRS Employer
    incorporation or organization)                           Identification No.)


    712 Fifth Avenue, New York, NY,                                 10019
----------------------------------------                          ----------
(Address of principal executive offices)                          (Zip Code)


                                 (212) 897-6849
                           ---------------------------
                           (Issuer's telephone number)

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

                      Title of each class registered: None
                         Name of each exchange on which
                                registered: OTCBB

         Securities registered under Section 12(g) of the Exchange Act:
                          Common Stock par value $0.001
                       : Preferred Stock par value $0.001

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 |_| No |X|

<PAGE>

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

The issuer had no revenues for its most recent fiscal year.

As of June 2, 2005 the issuer had 42,924,508 shares of common stock outstanding.

Based on the average of the closing bid and asked prices of the issuer's common
stock on June 2, 2005, the aggregate market value of the voting stock held by
non-affiliates of the registrant on that date was $ 182,429,150.

Documents incorporated by reference: See Item 13, Exhibits page 32.

Transitional Small Business Disclosure Format (check one): Yes |_| No |X|


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                           BIOACCELERATE HOLDINGS, INC
                                    CONTENTS

                                                                            PAGE

PART I

   Item 1.  Description of Business............................................4
   Item 2.  Description of Property...........................................24
   Item 3.  Legal Proceedings.................................................24
   Item 4.  Submission of Matters to a Vote of Security Holders...............24

PART II

   Item 5.  Market for Common Equity and Related Stockholder Matters
            and Small Business Issuer Purchase of Equity Securities ..........25
   Item 6.  Management's Discussion and Analysis or Plan of Operation.........25
   Item 7.  Financial Statements..............................................29
   Item 8.  Changes in and Disagreements with Accountants on
                   Accounting and Financial Disclosure........................51
   Item 8a. Controls and Procedures ..........................................51

PART III

   Item 9.  Directors, Executive Officers, Promoters and Control
                   Persons; Compliance with Section 16(a) of the
                   Exchange Act...............................................52
   Item 10. Executive Compensation............................................54
   Item 11. Security Ownership of Certain Beneficial Owners,
            Management and related Stockholder matters........................55
   Item 12. Certain Relationships and Related Transactions....................57
   Item 13. Exhibits and Reports on Form 8-K..................................57
   Item 14. Principal Accountant Fees and Services............................59

SIGNATURES  ..................................................................59


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                           BIOACCELERATE HOLDINGS, INC

                           FORWARD-LOOKING STATEMENTS

This report contains forward-looking statements. The forward-looking statements
include all statements that are not statements of historical fact. The
forward-looking statements are often identifiable by their use of words such as
"may," "expect," "believe," "anticipate," "intend," "could," "estimate," or
"continue," or the negative or other variations of those or comparable terms.
Our actual results could differ materially from the anticipated results
described in the forward-looking statements. Factors that could affect our
results include, but are not limited to, those discussed in Item 6,
"Management's Discussion and Analysis or Plan of Operation" and included
elsewhere in this report.

                                     PART I

ITEM 1 - DESCRIPTION OF BUSINESS

Corporate Formation

Bioaccelerate Holdings, Inc ("Bioaccelerate" or "Company"), formerly Mobile
Design Concepts, Inc. ("Mobile"), acquired Bioaccelerate, Inc. ("BI") in an
exchange of stock on September 23, 2004. Simultaneously with the exchange of
stock, Mobile Design Concepts, Inc. changed its name to Bioaccelerate Holdings,
Inc. Mobile was organized under the laws of the State of Nevada on March 10,
2000. Mobile was formed to design, manufacture, and lease mobile kiosks and
other structures the operation was discontinued on December 31, 2002.

The Company is examining opportunities in both start-up and emerging companies
in the biopharmaceutical sector.

BI was organized under the laws of the State of Delaware on December 29, 1995 as
Tallman Supply Corp. On January 14, 1999 the Company changed its name to
Westminster Auto Retailers, Inc. On July 25, 2003 the Company changed its name
to Bioaccelerate, Inc.

The Company was formed to capitalize on opportunities in the biopharmaceutical
market through the development of compounds and also companies that will
commercialize those compounds. The Company acquires and develops pharmaceutical
assets, both corporate and physical. The company focuses on five medical areas,
cancer, cardiovascular disease, lifestyle, central nervous system disorders, and
anti-viral, areas with a current combined global market value of in excess of
$250 billion, according to Reuters Business Insight

Business

Bioaccelerate (or "The Company") acquires and develops pharmaceutical compounds
that have substantial medical and commercial value. The companies in which
Bioaccelerate currently has interests focus on five vertical therapeutic areas;
Oncology, Specialty Pharma, Central Nervous System, Cardiovascular and
Infection. These therapeutic areas represent a current combined market
opportunity in excess of $250 billion.

Reducing risk, accelerating speed to market

Bioaccelerate uses a virtual development network to accelerate the development
of multiple early stage compounds to Phase II/III clinical development. The
Company believes that this strategy creates a lower risk business model, since
its network enables the timely and cost effective passage from the discovery
process up to Phase II/III where substantial incremental value is created.

Innovation complemented by a diverse partner network

Bioaccelerate's innovative approach focuses on the use of latest technologies to
cut development costs and reduce the amount of time that a drug spends in
development. Bioaccelerate's key objective is to create value through its
aggressive development of existing companies and compounds, as well as;

o Identifying additional compounds for portfolio companies;

o Entering into partnering, co-development and marketing agreements with large
pharmaceutical and other biotech companies, speeding time to market for the
compounds being developed;


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o Using industry expertise, business contacts and insights of in-house
scientific and business management to develop synergies and establish
collaborative agreements;

o Orchestrating a network of development resource to ensure efficiency in the
development process;

o Creating substantial shareholder value through the development of existing and
further portfolio companies, via the deep asset base of identified compounds
that Bioaccelerate has access to via established relationships.

A strategic approach to creating value

Large pharmaceutical companies need additional products to fill depleted
pipelines. Bioaccelerate believes it has developed a cost effective process
which provides a link between early stage drug candidates and large
pharmaceutical companies. Currently, funding is increasingly only available from
the capital markets for later stage companies. Bioaccelerate develops and
consolidates multiple early stage products in standalone companies in vertical
therapeutic areas until critical mass and development milestones are achieved.
At this stage the company is then ready to access further funding from the
capital markets. This affords orphan/individual technologies an opportunity to
be developed while giving academic institutions and scientists access to
development capital for early stage compounds. Bioaccelerate's drug development
strategy includes in-licensing compounds from various academic, research and
medical centers where the company has developed extensive relationships.
Bioaccelerate is constantly reviewing these development opportunities to
establish which products offer the best strategic fit with other companies in
its portfolio.

A proven depth of expertise

Bioaccelerate has a proven management team with a broad base of experience in
pharmaceutical & biotechnology companies as well as capital markets. The
management team is responsible for company-wide initiatives, significant
operating decisions and policymaking. This team works alongside a scientific
advisory board whose function is to advise the Company on scientific aspects of
product selection and development. Bioaccelerate conducts its business directly
and through its subsidiaries. Bioaccelerate Holdings inc. currently holds 100%
of Bioaccelerate inc. ,Bioaccelerate Ltd. and Bioaccelerate Ltd (BVI), and
through these subsidiaries a significant equity interest in the following
thirteen biotech companies:

Oncology:                Evolve Oncology, Inc. (49%), Genar Oncology, Inc.
                         (94%), Innovate Oncology,  Inc. (90%), OncBio, Inc.
                         (90%)

Specialty Pharma:        Innova Lifestyle, Inc. (94%),
                         Amilar Pharmaceuticals Inc, (94%)
                         Enhance Biotech, Inc. (22.4%)

Central Nervous System:  CNS Thera, Inc. (94%), NeuroBioscience, Inc (19%),

Cardiovascular disease:  InnCardio, Inc. (94%) BioCardio, Inc. (50 %)

Anti-infective:          Anvira, Inc. (94%)

As at December 31, 2004 the Company also has investments in Advance Nanotech Inc
(AVNA.OB), Australian Cancer Technologies Ltd (ACU.AX), JPS Holdings and Llama
Biotech Ltd

Our management believes that large pharmaceutical companies need additional
drugs to fill depleted drug development pipelines, particularly since many
existing products of large pharmaceutical companies will soon be losing patent
protection. Increasingly those companies seek to fill that gap by in-licensing
drugs at the middle to late stages of development rather than acquiring
compounds at an earlier stage. We believe that the large in-house basic and
applied research staffs of those large pharmaceutical companies increase the
overhead of those companies and may also engender institutional resistance to
acquisition or development of in- licensed drugs, resulting in costs and delays
in development of new drugs by those companies. It also appears to us that that
many individual scientists and medical research institutions may lack the
expertise or resources to develop promising early stage drug candidates.


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Bioaccelerate's business goal is to act as a cost-effective pharmaceutical
development organization, identifying commercially viable early-stage compounds
from academic, research and medical centers where Bioaccelerate has forged
strong relationships, and utilizing our expedited product development structure
to provide a cost-effective link between early-stage drug candidates and large
pharmaceutical companies. Bioaccelerate achieves its value by providing
management expertise and funding to develop the products assigned to its
portfolio companies and achieves shareholder value by taking the portfolio
companies public and benefiting from the upside in share price of those
portfolio companies as and when milestones are achieved in the development of
the compounds.

Strategy

Bioaccelerate and its subsidiaries select, in-license and group, early- stage
compounds which their respective managements deem promising in the stand-alone
companies which Bioaccelerate has organized by vertical therapeutic areas.
Bioaccelerate may utilize its own resources for the initial operations of a
newly-formed subsidiary, including its initial in- licensing. However, when a
subsidiary company's product pipeline reaches critical mass and achieves certain
development milestones, it is intended that the subsidiary company will seek
additional funding from the capital markets on its own. Since funding is often
only available for later-stage compounds, Bioaccelerate's development resources
make it possible for academic institutions and scientists to pursue early- and
mid-stage develop of orphaned compounds and technology.

Bioaccelerate generally favors in-licensing compounds in the early- to mid-
stages of development to reduce the risks and costs associated with new
molecular entity (NME) and new chemical entity (NCE) development. Bioaccelerate
will continue to advance its clinical development strategy, balancing
in-licensing and reformulations with NME and NCE development when it feels it is
appropriate.

Bioaccelerate enters into development, marketing and partnership agreements with
laboratories, industry experts and large pharmaceutical companies to develop,
test and seek regulatory approval for drug candidates. By relying primarily upon
contracts with third parties for research, clinical development and project
management rather than doing that work in-house, Bioaccelerate is able to
maintain a limited infrastructure, particularly as compared with large
pharmaceutical companies. Our management believes that this strategy offers a
lower risk model for achieving incremental value for investors in new drug
products, allows us to accelerate the time it takes for new products to reach
the critical Phase II/III clinical trials level, and creates an efficient and
cost-effective route from discovery to commercializing a product.

Research and Development

The structure of our research and development activity is designed to enable the
best choices to be made as to where and how the projects are run and resourced.
Each is managed as a discreet project with its own budget and project manager.
Where and when possible projects make common use of the resources and contracted
facilities enlisted at each stage. We manage our projects through ongoing review
of scientific data, making use of our broadly experienced Management and
Scientific Advisory Board to assist in this process and by supplementing these
programs with our cost allocations as required to move toward regulatory
approval. Our cost allocations are based primarily on pre-established
development budgets set out in our agreements with research and co-development
partners. Costs attributed to Research and Preclinical projects largely
represent our pipeline generating activities. See Item 6. "Management Discussion
and Analysis of Financial Condition and Results of Operations" for further
discussion of research and development spending trends.


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                 OUR PRODUCT DEVELOPMENT PORTFOLIO AND PIPELINE

1. ONCOLOGY

Oncology is the therapeutic market with the largest portfolio of products in
development by Bioaccelerate and its subsidiaries. Reuters Business Insight
forecasts the global cancer treatment market to grow from $34.3 billion in 2002
to $42.8 billion in 2007. Their research also indicates that the innovative
cancer therapy market will triple from $4.3 billion in 2001 to $12.3 billion in
2007.

EVOLVE ONCOLOGY. Evolve Oncology seeks to acquire, develop and commercialize
drugs to treat various types of cancer. Evolve Oncology's product development
portfolio targets lung, breast and other types of cancer. Evolve Oncology's
management believes its focus on innovative treatments should benefit from the
market opportunity created by multiple patent expirations, particularly in
hormonal and cytostatic therapies facing the large pharmaceutical companies.
Bioaccelerate will also seek to develop niche drugs passed over by large
pharmaceutical companies.

ONCBIO. OncBio seeks to acquire, develop and commercialize drugs to treat
multiple cancers such as breast, lung and chronic myelogenous leukemia. OncBio's
product development pipeline focuses on new, innovative compounds as well as
enhanced formulations of existing compounds.

GENAR ONCOLOGY. Genar Oncology seeks to acquire, develop and commercialize a
broad platform of compounds to fight cancers. Bioaccelerate's product
development portfolio targets multiple cancers, such as a single product one for
solid tumors prevalent in breast, lung and colorectal cancer. Management
believes these multiple-use products will enhance the drugs' value in the
marketplace.

INNOVATE ONCOLOGY. Innovate Oncology seeks to acquire, develop and commercialize
compounds targeted at multiple cancers and oncology-related conditions. Some of
the oncology related conditions we seek to address are reversing chemo
resistance and treating common side effects such as nausea and vomiting.
Innovate Oncology's pre-clinical product development portfolio is all based upon
scientific approaches which our management believes are innovative.

Bioaccelerate through it's subsidiaries is developing a platform of compounds
which have been selected to target multiple cancers, instead of focusing on only
one specific disease area. This approach management believes will enhance the
compounds future values and give the drugs a greater chance of success.

2. SPECIALTY PHARMA

The specialty pharma segment of the global pharmaceutical marketplace is
projected to grow from $22.9 billion in 2002 to $29 billion by 2007, according
to Reuters Business Insight. Bioaccelerate's management believes its three
lifestyle drug subsidiary companies are poised to take advantage of some of the
most potentially lucrative segments, including sexual dysfunction, skin diseases
and addiction.

ENHANCE BIOTECH. Enhance Biotech acquires, develops and commercializes drugs to
treat lifestyle disorders. Enhance's portfolio of seven products under
development target male sexual dysfunction and dermatology, two of the seven
major therapeutic segments in the lifestyle drug market. Enhance's lead product
targets premature ejaculation, which is the most widespread indication in male
sexual dysfunction (MSD). The disorder affects 29% of the adult male population
and represents a potential $6 billion market, according to Reuters Business
Insight.

Enhance Biotech recently acquired Ardent Pharmaceuticals Inc., a privately held
biotechnology company with an extensive research and development pipeline that
includes a number of pre- clinical and clinical drug candidates in the areas of
moderate to severe pain, urinary incontinence, premature ejaculation, depression
and cardio protection. Pursuant to the merger agreement, Ardent became a wholly-
owned subsidiary of Enhance Biotech and the former Ardent stockholders received
Enhance Biotech securities amounting, on a fully- diluted basis, to 45% of
Enhance Biotech's outstanding equity securities, post- merger. Shareholders of
Enhance Biotech own 55 % of the merged entity.

INNOVA LIFESTYLE. Innova Lifestyle seeks to acquire, develop and commercialize
drugs for lifestyle disorders including acne, alcohol addiction and female
sexual dysfunction. Awareness has been increasing about the need for effective
and safe female stimulants to treat female sexual dysfunction. Analysts at
Reuters Business Insight say this disorder is still poorly defined and
understood, evidenced by their research that indicates that between 19% and 43%
of women in the general population suffer from sexual dysfunction. Despite that
prevalence, only 26% of women across the major markets seek treatment.
Bioaccelerate believes treatment for female sexual dysfunction may be a major
market opportunity following in the footsteps of the strong public response to
male erectile and premature dysfunction treatments coming to market now.


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AMILAR PHARMACEUTICALS. Amilar Pharmaceuticals seeks to acquire, develop and
commercialize drugs to treat lifestyle disorders.

3. CENTRAL NERVOUS SYSTEM

The worldwide population with CNS disorders is rising steadily. This increase is
being driven by an aging population, improving diagnostic techniques, increasing
physician and patient awareness and a gradual shift away from the social stigma
traditionally attached to many psychiatric conditions. As the prevalence of CNS
disorders rises, so does the cost. In the U.S., it is estimated that more than
20% of healthcare spending is directed towards CNS-related disorders, according
to Reuters Business Insight. Alzheimer's disease alone is estimated to cost the
U.S. economy $100 billion annually, with a prevalent population of more than 4
million. Bioaccelerate is seeking to tap the potential in this market by
developing subsidiaries with diversified products to target the broad range of
CNS diseases.

CNS THERA. CNS Thera seeks to acquire, develop and commercialize compounds
targeted against various central nervous system disorders. Bioaccelerate's
portfolio of products under development focuses on some of the largest potential
markets such as Alzheimer's disease, epilepsy, multiple sclerosis and
Parkinson's disease.

4. CARDIOVASCULAR DISEASE

Among the cardiovascular diseases, a disorder of lipid metabolism called
dyslipidemics has had the fastest growth in global sales. In 2002, the global
anti-dyslipidemics market generated sales of $21.86 billion and Reuters Business
Insight forecasts annual sales to rise to $32.6 billion by 2008. Dyslipidemics
is often used as a blanket term to describe any imbalance in the level of blood
lipids (fats) and a variety of conditions characterized by either excessively
high or excessively low levels of certain lipids in the bloodstream, including
cholesterol and triglycerides. Within cardiovascular disease,
hypercholester-olemia is the most common risk, with an average prevalence rate
of 43.8% in the seven major markets.

BIOCARDIO. Biocardio seeks to acquire, develop and commercialize therapies to
treat cardiovascular and metabolic diseases. Bioaccelerate's products under
development target heart disease, cholesterol imbalances and chronic obstructive
pulmonary disorder (COPD). COPD is lung damage caused by smoking and has the
third largest burden of disease in the world. Bioaccelerate believes its novel
therapy, if successfully developed and approved, will fill a largely unmet need
for treatment.

INNCARDIO. Inncardio seeks to acquire, develop and commercialize therapies to
treat cardiovascular and metabolic diseases including diabetes, artherosclerosis
and myocardial ischemia. Approximately 60 million people in seven major markets
suffer from diabetes, 17 million in the U.S. alone.

5. ANTI-INFECTIVES

The global anti-virals market, which is a subset of anti-infective, is forecast
to grow from $8.7 billion in 2001 to $14 billion in 2007, according to Reuters
Business Insight. Much of that growth comes from the high incidence of viral
infections and currently available drugs that are not efficacious. Another
growth factor for this therapeutic area is a strategy by big pharmaceutical
companies that increasingly target patients in developing countries.
Bioaccelerate believes this change creates an opportunity to develop its
anti-infective portfolio.

ANVIRA. Anvira seeks to acquire, develop and commercialize anti- infective
products for common diseases such as ear and throat infections as well as
pneumonia and bronchitis. Bioaccelerate's current portfolio of products under
development consists of reformulations of off- patent anti- infectives.


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Product Development

A major element of the Company's product development strategy is to use
third-party or contract research organizations ("CROs") to assist in the conduct
of safety and efficacy testing and clinical studies, to assist the Company in
guiding products through the FDA and EMEA regulatory review and approval
processes, and to manufacture and distribute any FDA and EMEA approved products.
The Company believes that maintaining a limited infrastructure will enable it to
develop products efficiently and cost effectively.

On November 1st, 2004 the Company entered into a contract with Faustus
Forschungs Cie, Translational Cancer Research GMBH for the co development of
nine compounds targeted at various forms of Cancer.

The Company believes the use of third-parties to develop and manufacture its
products has several advantages. This approach generally allows a greater pool
of resources to be concentrated on a product than if these functions were
preformed by internal personnel who were required to support all of the
Company's product development activities. Although this approach will allow the
Company to avoid the expense associated with developing a large internal
infrastructure to support its product development efforts, it will result in the
Company being dependent on the ability of outside parties to perform critical
functions for the Company. Over time, the Company expects to build internal
capabilities to replace certain development functions now contracted to outside
parties.

This contract approach to product development requires project management by
professionals with substantial industry experience. The Company will continue to
evaluate prospective additions to its in-house expertise, as well as
opportunities for contract and advisory services in areas of critical importance
to all of its proposed products, including the management of current development
teams. These areas include regulatory affairs, marketing and sales, quality
assurance, manufacturing, clinical trials management, finance, information
systems and general management.

The product development process is designed to identify problems associated with
a proposed product's safety and effectiveness. The Company attempts to reduce
the risk that a proposed product will not be accepted in the marketplace by
conducting market research and defining commercial strategy for each product
candidate. A drug development portfolio cannot be completely insulated from
potential clinical and market failures. It is likely that some proposed products
selected for development by the Company will not produce the clinical or revenue
results expected.

Research Product Pipeline

The Company will continue to invest in the research and development of existing
and new products, including those that could extend the applications of existing
technologies. The Company is currently evaluating a number of product candidates
arising from various academic facilities and other biotech companies.

Market Overview

The pharmaceutical industry is characterized by ongoing convergence and
consolidation. Large pharmaceutical companies continue to experience depleted
product pipelines and reduced research and development ("R&D") productivity, as
measured by declining numbers of approved new chemical entities despite
year-on-year increases in R&D spending.

ONCOLOGY

Cancer is not a single disease, but a set of several hundred distinct neoplastic
entities that together represent the third largest disease burden of any
therapeutic area. According to the 2003 Facts and Figures report issued by the
American Cancer Association, men in the United States have an approximately 1 in
2 chance of developing cancer during their lifetime. The increasing age of the
population and the continuing morbidity and mortality associated with this
disease confirm the need for continued scientific research and the development
of new therapies.

o In 2004 over 10 million people were diagnosed with cancer, by 2015 this is
forecast to reach 15 million. Six million people die from cancer every year,
representing 12% of deaths worldwide.

o The National Cancer Institute estimates the overall cost of cancer in the U.S.
to be in excess of $100 billion. Treatment of breast, lung and prostate cancers
accounts for over half the direct medical costs.

o The global cancer market was valued at $34.3 billion in 2002, a 16.5% increase
on previous year's sales of $29.5 billion. Cytotoxic drugs were the largest
class, followed by hormonal therapeutics. A fast growing category was a class
that includes cytokines and monoclonal antibodies. This class, known as the
innovative therapy category, was driven by widespread physician uptake which led
to growth of over 57%.


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o Oncology is currently the most active area of research for multi-national
pharmaceutical companies. BMS is currently the leading player in the oncology
market in revenue terms, with total oncology sales of $3.71 billion equating to
a 10% market share.

SPECIALTY PHARMA

Specialty pharma (including `lifestyle' drugs) enhance or improve human function
in individuals who believe that their problems - from sexual dysfunction to
diabetes, incontinence and obesity - negatively affect normal aspects of
everyday living. These conditions should be capable of being defined and
diagnosed with reference to measurable characteristics, of known etiology, and
prospective patients must be capable of being targeted and convinced of the
value of pharmacotherapy.

o The appeal of Specialty drugs lies in their ability to improve physical and
mental well-being and as an alternative to making lifestyle changes.

o The ability to create new disease markets, as is currently happening in the
area of female sexual dysfunction, will cause the overall Specialty pharma
market to expand significantly over the next two decades.

o When developing and defining a new Specialty condition: (a) the disorder must
be capable of being clearly defined and diagnosed with reference to measurable
characteristics, (b) the epidemiology of the condition must be known, and (c)
prospective patients must be capable of being targeted and convinced of the
value of pharmacotherapy.

o According to definition and included conditions, the global market for
Specialty/lifestyle medicines is estimated at close to $22 billion. Leading
contributors to this total include Sexual function, ED ($2.5 billion); Smoking,
alcohol ($1.5 billion); Oral contraceptives ($4.0 billion); Obesity ($1
billion); Selected dermatological conditions ($4.0 billion); Inflammatory Bowel
Disease ($2.0 billion); and Fatigue ($2.0 billion).

CENTRAL NERVOUS SYSTEM

CNS (Central Nervous System) products represent a large and fast-growing sector
of the pharmaceutical market. The segment is based on neurological and
psychiatric conditions, which have been estimated to account for over 15% of the
disease burden within the world's developed economies. Conditions include
Alzheimer's Disease, Depression, Epilepsy, Migraine, Multiple Sclerosis, Pain,
Parkinson's Disease and Schizophrenia.

o The worldwide population with CNS disorders is steadily rising. This is being
driven by an aging population, improving diagnostic techniques, increasing
physician and patient awareness and a gradual shift away from the social stigma
traditionally attached to many psychiatric conditions.

o As the prevalence of CNS disorders rises, so does the cost. In the US, it is
estimated that over 20% of healthcare expenditure is directed towards CNS
related disorders. Alzheimer's disease alone is estimated to cost the US economy
$100 billion annually, with a prevalent population of over 4m.

o Neuroscience (CNS) world market value is over $98 billion, growing at 11% per
annum.

o The global CNS market is dominated by four major players, GlaxoSmithKline, Eli
Lilly, Pfizer and Janssen, who hold a combined market share of 38.8%.

CARDIOVASCULAR

The Cardiovascular market is one of the largest of all pharmaceutical sectors.
Cardiovascular disease includes heart failure, atrial fibrillation, stable
angina and peripheral arterial disease. Acute thrombotic events, including
unstable angina, myocardial infarction, deep vein thrombosis, pulmonary embolism
and stroke also contribute to the burden of disease. Risk factors including
hypercholesterolemia, hypertension, diabetes and obesity predispose the
development of cardiovascular disease in later life.

o Cardiac therapy holds enormous potential for new drugs due to high unmet need
within substantial patient populations.

o Cardiovascular world market value is currently valued at $116 billion.
Cardiovascular disease accounts for 17 million deaths globally each year. The
Statin market has a world market value of $26 billion


                                     - 10 -
<PAGE>

o Antithrombotics sales grew to just under $10 billion in 2002, with
antiplatelet therapies representing a 58% share of the class.

o Pfizer is the dominant player in the global cardiovascular market with a 19%
market share.

INFECTION

Infectious diseases continue to be a leading cause of morbidity and mortality
across the globe. They are a leading cause of death, accounting for a quarter to
a third of the estimated 54 million deaths worldwide in 1998. However, new and
re-emerging infectious diseases may pose a rising global health risk. The spread
of infectious diseases can result as much from changes in human behaviour - from
lifestyles, land use patterns, increased trade and travel to inappropriate use
of antibiotic drugs - as from mutations in pathogens.

o The three main types of infections for which there is a significant market
are, in terms of Causitive Micro-organisms; - bacterial - fungal viral

In terms of the total anti-infective market, the contribution of the
anti-infective segment increased from 14% in 1996 to 22% in 2001.

o The Infection world market in 2004 was valued at $53 billion.

o There are around 30 key drugs in the Infection market. There are a number a
very large selling broad spectrum antibiotics dominating the Infection market,
such as Zithromax (Pfizer), Cipro (Bayer) and Augmentin (GSK) The Intron
franchise of Schering-Plough, which is used for the treatment of hepatitis C
infections, dominates the antiviral drugs market with a share of around 17%.
Combivir, GlaxoSmithKline's combination drug for the treatment of HIV, is the
second leading antiviral drug and has a market share of 10%.

o The major players in the Infection market are GlaxoSmithKline,
Schering-Plough, Bristol Myers Squibb, Hoffman La Roche, Merck, Abbott
Laboratories, Pfizer, J&J and Bayer. GlaxoSmithkline is the market leader with a
share of 20%. Pfizer is the second largest player with a market share of 10%.

Patents and Proprietary Rights

The Company's success will depend, in part, upon our ability to obtain and
enforce protection for our products under United States and foreign patent laws,
as well as other intellectual property laws, preserve the confidentiality of our
trade secrets and operate without infringing the proprietary rights of third-
parties. Our policy is to file patent applications in the United States,
European Union and foreign jurisdictions to protect technology, inventions and
improvements to our inventions that are considered important to the development
of our business. Also, we rely upon trade secrets, know-how, continuing
technological innovations and licensing opportunities to develop a competitive
position.


                                     - 11 -
<PAGE>

Through our current co-development and licensing agreements, we have acquired
the right to utilize technology covered by multiple issued patents and multiple
patent applications, as well as additional intellectual property and know-how
that could be the subject of further patent applications in the future. We
evaluate the desirability of seeking patent or other forms of protection for our
products in foreign markets based on the expected costs and relative benefits of
attaining this protection. There can be no assurance that any patent will be
issued for any application or that any issued patents will afford adequate
protection to us. Further, there can be no assurance that any issued patents
will not be challenged, invalidated, infringed or circumvented or that any
rights granted thereunder will provide competitive advantages to us. Parties not
affiliated with us may have obtained or may obtain United States or foreign
patents or possess or may possess proprietary rights relating to our products.
There can be no assurance that patents now in existence or hereafter issued to
others will not adversely affect the development or commercialization of our
products or that our planned activities will not infringe patents owned by
others.

We could incur substantial costs in defending ourselves in infringement suits
brought against us or any of our licensors or in asserting any infringement
claims that we may have against others. We could also incur substantial costs in
connection with any suits relating to matters for which we have agreed to
indemnify our licensors or distributors. An adverse outcome in any litigation
could have a material adverse effect on our business and prospects. In addition,
we could be required to obtain licenses under patents or other proprietary
rights of third parties. No assurance can be given that any of these licenses
would be made available on terms acceptable to us, or at all. If we are required
to, and do not obtain any required licenses, we could be prevented from, or
encounter delays in, developing, manufacturing or marketing one or more of our
products.

We also rely upon trade secret protection for our confidential and proprietary
information. There can be no assurance that others will not independently
develop substantially equivalent proprietary information and techniques or
otherwise gain access to our trade secrets or disclose this technology or that
we can meaningfully protect our trade secrets.

It is our policy to require our employees, consultants, members of the
Scientific Advisory Board and parties to collaborative agreements to execute
confidentially agreements upon the commencement of employment or consulting
relationships or collaboration with us. These agreements provide that all
confidential information developed or made known during the course of the
relationship with us is to be kept confidential and not disclosed to third
parties except in specific circumstances. In the case of employees, the
agreements provide that all inventions resulting from work performed for us,
utilizing our property or relating to our business and conceived or completed by
the individual during employment shall be our exclusive property to the extent
permitted by applicable law.

Government Regulation

Our products are subject to extensive regulation by numerous governmental
authorities, principally the United States Food and Drug Administration ("FDA")
and the European Union European Medicines Evaluation Agency ("EMEA"), as well as
numerous state and foreign agencies. We need to obtain clearance of our
potential products by the FDA and EMEA before we can begin marketing our
products in the United States and European Union, respectively. Similar
approvals are also required in other countries.

Product development and approval within these regulatory frameworks is
uncertain, can take many years and requires the expenditure of substantial
resources. The nature and extent of the government review process for our
potential products will vary, depending on the regulatory categorization of
particular products and various other factors. In particular, during 2003 the
FDA implemented a reorganization to consolidate review of new pharmaceutical
products within the FDA's Center for Drug Evaluation and Research ("CDER").
Prior to this reorganization, the FDA's Center for Biologics Evaluation and
Research ("CBER"), reviewed new biological products, while CDER reviewed new
drug products and combination drug/biological products. We do not believe the
FDA's reorganization will significantly affect the review process of our product
candidates; however we are monitoring events within the FDA and EMEA, to keep
pace with current developments.


                                     - 12 -
<PAGE>

The necessary steps before a new pharmaceutical product may be sold in the
United States ordinarily include:

o pre-clinical laboratory and animal tests;

o submission to the FDA of an investigational new drug application which must
become effective before clinical trails may commence;

o completion of adequate and well controlled human clinical trials to establish
the safety and efficacy of the proposed drug for its intended use;

o submission to the FDA of a marketing authorization application; and

o FDA review and approval of the marketing authorization application prior to
any commercial sale.

Clinical trials generally are conducted in three sequential phases that may
overlap. In Phase I, the initial introduction of the product into humans, the
product is tested to assess safety, metabolism, pharmacokinetics and
pharmacological actions associated with increasing doses. Phase II usually
involves trials in a limited patient population to determine the efficacy of the
potential product for specific, targeted indications, determine dosage tolerance
and optimum dosage and further identify possible adverse reactions and safety
risks. Phase III trials are undertaken to evaluate further clinical efficacy in
comparison to standard therapies within a broader patient population, generally
at geographically dispersed clinical sites. Phase I, Phase II or Phase III
testing may not be completed successfully within any specific period of time, if
at all, with respect to any of our product candidates. Furthermore, the FDA, an
institution review board or the Company may suspend a clinical trial at any time
for various reasons, including finding that the subjects or patients are being
exposed to an unacceptable health risk.

The results of pre-clinical studies, pharmaceutical development and clinical
trials are submitted to the FDA in the form of a marketing authorization
application for approval of the manufacture, marketing and commercial shipment
of the pharmaceutical product. The testing and approval process is likely to
require substantial time, effort and resources, and there can be no assurance
that any approval will be granted on a timely basis, if at all. The FDA may deny
a marketing authorization application if applicable regulatory criteria are not
satisfied, require additional testing or information, or require post-market
testing and surveillance to monitor the safety or efficacy of the product. In
addition, after marketing approval is granted, the FDA may require
post-marketing clinical trials, which typically entail extensive patient
monitoring and may result in restricted marketing of an approved product for an
extended period of time.

Competition

The biotechnology and biopharmaceutical industries are characterized by rapidly
advancing technologies, intense competition and a strong emphasis on proprietary
products. Many third-parties compete with us in developing various approaches to
lifestyle disorders. They include pharmaceutical companies, biotechnology
companies, academic institutions and other research organizations.

Many of our competitors have significantly greater financial resources and
expertise in research and development, manufacturing, pre-clinical testing,
conducting clinical trials, obtaining regulatory approval and marketing than we
do. In addition, many of these competitors are active in seeking patent
protection and licensing arrangements in anticipation of collection royalties
for proprietary technology. Smaller or early-stage companies may also prove to
be significant competitors, particularly through collaborative arrangements with
large and established companies. These third parties compete with us in
recruiting and retaining qualified scientific and management personnel, as well
as acquiring technologies complementary to our programs.

We expect that competition among products approved for sale will be based, among
other things, on efficacy, reliability, product safety, price and patent
position. Our ability to compete effectively and develop products that can be
manufactured cost-effectively and marketed successfully will depend on our
ability to:

o advance our lead product candidates and technology platforms;

o obtain required government and other public and private approvals on a timely
basis;

o enter into corporate partnerships;


                                     - 13 -
<PAGE>

o license additional technology;

o maintain a proprietary position in our technologies and products; and

o attract and retain key personnel.

NUMBER OF TOTAL EMPLOYEES AND NUMBER OF FULL TIME EMPLOYEES

Bioaccelerate has twelve full-time employees. Of these, eight are management
employees and four are administrative or support staff. Of these employees, six
are located in our offices in New York, and six are located in our offices in
London, England. All of our employees have executed customary confidentiality
and restrictive covenant agreements.

                                  RISK FACTORS

Our business, financial condition or operating results are subject to a number
of risk factors, both those that are known to us and identified below and others
that may arise from time to time. These risk factors could cause our actual
results to differ materially from those suggested by forward-looking statements
in this document and elsewhere, and may adversely affect our business, financial
condition or operating results. If any of those risk factors should occur,
moreover, the trading price of our securities could decline, and investors in
our securities could lose all or part of their investment in our securities.
These risk factors should be carefully considered in evaluating the Company and
its prospects.

WE HAVE A LIMITED OPERATING HISTORY, WHICH MAKES IT DIFFICULT TO EVALUATE OUR
BUSINESS AND TO PREDICT OUR FUTURE OPERATING RESULTS. WE HAVE NOT GENERATED ANY
REVENUES TO DATE.

Since our inception, we have been primarily engaged in organizational
activities, including developing a strategic operating plan, in-licensing or
acquiring drug compounds which we believe to be promising, entering into various
collaborative agreements for the development of products and technologies,
hiring personnel and developing and testing our products. We have not generated
any material revenues to date. Accordingly, we have no relevant operating
history upon which an evaluation of our performance and prospects can be made.

WE HAVE INCURRED NET LOSSES SINCE COMMENCING BUSINESS AND EXPECT FUTURE LOSSES.

To date, we have incurred significant net losses, including net losses of $
157,459,885 for seven months ended December 31, 2004. At December 31, 2004, we
had an accumulated deficit of $160,569,414. We anticipate that we may continue
to incur significant operating losses for the foreseeable future. We may never
generate material revenues or achieve profitability and, if we do achieve
profitability, we may not be able to maintain profitability.

CLINICAL TRIALS FOR OUR PRODUCTS WILL BE EXPENSIVE AND MAY BE TIME CONSUMING,
AND THEIR OUTCOME IS UNCERTAIN, BUT WE MUST INCUR SUBSTANTIAL EXPENSES THAT MAY
NOT RESULT IN ANY VIABLE PRODUCTS.

Before obtaining regulatory approval for the commercial sale of a product, we
must demonstrate through pre-clinical testing and clinical trials that a product
candidate is safe and effective for use in humans. Conducting clinical trials is
a lengthy, time-consuming and expensive process. We will incur substantial
expense for, and devote a significant amount of time to pre-clinical testing and
clinical trials.

Historically, the results from pre-clinical testing and early clinical trials
have often not been predictive of results obtained in later clinical trials. A
number of new drugs have shown promising results in clinical trials, but
subsequently failed to establish sufficient safety and efficacy data to obtain
necessary regulatory approvals. Data obtained from pre-clinical and clinical
activities are susceptible to varying interpretations, which may delay, limit or
prevent regulatory approval. Regulatory delays or rejections may be encountered
as a result of many factors, including changes in regulatory policy during the
period of product development. Regulatory authorities may require additional
clinical trials, which could result in increased costs and significant
development delays.

Completion of clinical trials for any product may take several years or more.
The length of time generally varies substantially according to the type,
complexity, novelty and intended use of the product candidate. Our commencement
and rate of completion of clinical trials may be delayed by many factors,
including:


                                     - 14 -
<PAGE>

* inability to manufacture sufficient quantities of materials for use in
clinical trials;

* slower than expected rate of patient recruitment or variability in the number
and types of patients in a study;

* inability to adequately follow patients after treatment;

* unforeseen safety issues or side effects;

* lack of efficacy during the clinical trials; or

* governmental or regulatory delays.

We rely primarily upon third parties for development and testing of our products
and technologies. If our development agreements do not proceed as planned, we
may incur delay in the commercialization of products which would delay our
ability to generate sales and cash flow from their sales.

WE MAY FAIL TO ADDRESS RISKS WE FACE AS A DEVELOPING BUSINESS WHICH COULD
ADVERSELY AFFECT THE IMPLEMENTATION OF OUR BUSINESS PLAN.

We are prone to all of the risks inherent to the establishment of any
developmental stage business venture. You should consider the likelihood of our
future success to be highly speculative in light of our limited operating
history, as well as the limited resources, problems, expenses, risks and
complications frequently encountered by similarly situated companies. To address
these risks, we must, among other things,

* maintain and increase our product portfolio;

* implement and successfully execute our business and marketing strategy;

* continue to develop new products and upgrade our existing products;

* respond to industry and competitive developments; and

* attract, retain, and motivate qualified personnel.

We may not be successful in addressing these risks. If we are unable to do so,
our business prospects, financial condition and results of operations would be
materially adversely affected.

WE MAY BE UNSUCCESSFUL IN OUR EFFORTS TO DEVELOP PRODUCTS.

To achieve profitable operations, we, alone or with others, must successfully
develop, clinically test, market and sell our products. The development of new
pharmaceutical products is highly uncertain and subject to a number of
significant risks. Most products resulting from our or our collaborative
partners' product development efforts are not expected to be available for sale
for at least several years, if at all. Potential products that appear to be
promising at early stages of development may not reach the market for a number
of reasons, including:

* discovery during pre-clinical testing or clinical trials that the products are
ineffective or cause harmful side effects;

* failure to receive necessary regulatory approvals;

* inability to manufacture on a large or economically feasible scale;

* failure to achieve market acceptance; or

* preclusion from commercialization by proprietary rights of third parties.

To date, our resources have been substantially dedicated to the acquisition,
research and development of products and technologies. Most of the existing and
future products and technologies developed by us will require extensive
additional development, including pre-clinical testing and clinical trials, as
well as regulatory approvals, prior to commercialization. Our product
development efforts may not be successful. We may fail to receive required
regulatory approvals from U.S. or foreign authorities for any indication. Any
products, if introduced, may not be capable of being produced in commercial
quantities at reasonable costs or being successfully marketed. The failure of
our research and development activities to result in any commercially viable
products or technologies would materially adversely affect our future prospects.


                                     - 15 -
<PAGE>

OUR INDUSTRY IS SUBJECT TO EXTENSIVE GOVERNMENT REGULATION AND OUR PRODUCTS
REQUIRE OTHER REGULATORY APPROVALS WHICH MAKES IT MORE EXPENSIVE TO OPERATE OUR
BUSINESS.

Regulation in General. Virtually all aspects of our business are regulated by
federal and state statutes and governmental agencies in the United States and
other countries. Failure to comply with applicable statutes and government
regulations could have a material adverse effect on our ability to develop and
sell products which would have a negative impact on our cash flow. The
development, testing, manufacturing, processing, quality, safety, efficacy,
packaging, labeling, record-keeping, distribution, storage and advertising of
pharmaceutical products, and disposal of waste products arising from these
activities, are subject to regulation by one or more federal agencies. These
activities are also regulated by similar state and local agencies and equivalent
foreign authorities.

FDA Regulation. All pharmaceutical manufacturers in the United States are
subject to regulation by the FDA under the authority of the Federal Food, Drug,
and Cosmetic Act. Under the Act, the federal government has extensive
administrative and judicial enforcement powers over the activities of
pharmaceutical manufacturers to ensure compliance with FDA regulations. Those
powers include, but are not limited to the authority to:

* initiate court action to seize unapproved or non-complying products;

* enjoin non-complying activities;

* halt manufacturing operations that are not in compliance with current good
manufacturing practices prescribed by the FDA;

* recall products which present a health risk; and

* seek civil monetary and criminal penalties.

Other enforcement activities include refusal to approve product applications or
the withdrawal of previously approved applications. Any enforcement activities,
including the restriction or prohibition on sales of products marketed by us or
the halting of manufacturing operations of us or our collaborators, would have a
material adverse effect on our ability to develop and sell products which would
have a negative impact on our cash flow. In addition, product recalls may be
issued at our discretion or by the FDA or other domestic and foreign government
agencies having regulatory authority for pharmaceutical product sales. Recalls
may occur due to disputed labeling claims, manufacturing issues, quality defects
or other reasons. Recalls of pharmaceutical products marketed by us may occur in
the future. Any product recall could have a material adverse effect on our
revenue and cash flow.

FDA Approval Process. We have a variety of products under development, including
line extensions of existing products, reformulations of existing products and
new products. All "new drugs" must be the subject of an FDA- approved new drug
application before they may be marketed in the United States. All generic
equivalents to previously approved drugs or new dosage forms of existing drugs
must be the subject of an FDA-approved abbreviated new drug application before
they may by marketed in the United States. In both cases, the FDA has the
authority to determine what testing procedures are appropriate for a particular
product and, in some instances, has not published or otherwise identified
guidelines as to the appropriate procedures. The FDA has the authority to
withdraw existing new drug application and abbreviated application approvals and
to review the regulatory status of products marketed under the enforcement
policy. The FDA may require an approved new drug application or abbreviated
application for any drug product marketed under the enforcement policy if new
information reveals questions about the drug's safety or effectiveness. All
drugs must be manufactured in conformity with current good manufacturing
practices and drugs subject to an approved new drug application or abbreviated
application must be manufactured, processed, packaged, held and labeled in
accordance with information contained in the new drug application or abbreviated
application.

The required product testing and approval process can take a number of years and
require the expenditure of substantial resources. Testing of any product under
development may not result in a commercially-viable product. Further, we may
decide to modify a product in testing, which could materially extend the test
period and increase the development costs of the product in question. Even after
time and expenses, regulatory approval by the FDA may not be obtained for any
products we develop. In addition, delays or rejections may be encountered based


                                     - 16 -
<PAGE>

upon changes in FDA policy during the period of product development and FDA
review. Any regulatory approval may impose limitations in the indicated use for
the product. Even if regulatory approval is obtained, a marketed product, its
manufacturer and its manufacturing facilities are subject to continual review
and periodic inspections. Subsequent discovery of previously unknown problems
with a product, manufacturer or facility may result in restrictions on the
product or manufacturer, including withdrawal of the product from the market.

Foreign Regulatory Approval. Even if required FDA approval has been obtained
with respect to a product, foreign regulatory approval of a product must also be
obtained prior to marketing the product internationally. Foreign approval
procedures vary from country to country and the time required for approval may
delay or prevent marketing. In certain instances, we or our collaborative
partners may seek approval to market and sell some of our products outside of
the United States before submitting an application for approval to the FDA. The
clinical testing requirements and the time required to obtain foreign regulatory
approvals may differ from that required for FDA approval. Although there is now
a centralized European Union approval mechanism for new pharmaceutical products
in place, each European Union country may nonetheless impose its own procedures
and requirements, many of which are time consuming and expensive, and some
European Union countries require price approval as part of the regulatory
process. Thus, there can be substantial delays in obtaining required approval
from both the FDA and foreign regulatory authorities after the relevant
applications are filed.

Changes in Requirements. The regulatory requirements applicable to any product
may be modified in the future. We cannot determine what effect changes in
regulations or statutes or legal interpretations may have on our business in the
future. Changes could require changes to manufacturing methods, expanded or
different labeling, the recall, replacement or discontinuation of certain
products, additional record keeping and expanded documentation of the properties
of certain products and scientific substantiation. Any changes or new
legislation could have a material adverse effect on our ability to develop and
sell products and, therefore, generate revenue and cash flow.

The products under development by us may not meet all of the applicable
regulatory requirements needed to receive regulatory marketing approval. Even
after we expend substantial resources on research, clinical development and the
preparation and processing of regulatory applications, we may not be able to
obtain regulatory approval for any of our products. Moreover, regulatory
approval for marketing a proposed pharmaceutical product in any jurisdiction may
not result in similar approval in other jurisdictions. Our failure to obtain and
maintain regulatory approvals for products under development would have a
material adverse effect on our ability to develop and sell products and,
therefore, generate revenue and cash flow.

WE MAY NOT BE SUCCESSFUL IN RECEIVING ORPHAN DRUG STATUS FOR CERTAIN OF OUR
PRODUCTS OR, IF THAT STATUS IS OBTAINED, FULLY ENJOYING THE BENEFITS OF ORPHAN
DRUG STATUS.


                                     - 17 -
<PAGE>

Under the Orphan Drug Act, the FDA may grant orphan drug designation to drugs
intended to treat a rare disease or condition. A disease or condition that
affects populations of fewer than 200,000 people in the United States generally
constitutes a rare disease or condition. We may not be successful in receiving
orphan drug status for certain of our products. Orphan drug designation must be
requested before submitting a new drug application. After the FDA grants orphan
drug designation, the generic identity of the therapeutic agent and its
potential orphan use are publicized by the FDA. Under current law, orphan drug
status is conferred upon the first company to receive FDA approval to market the
designated drug for the designated indication. Orphan drug status also grants
marketing exclusivity in the United States for a period of seven years following
approval of the new drug application, subject to limitations. Orphan drug
designation does not provide any advantage in, or shorten the duration of, the
FDA regulatory approval process. Although obtaining FDA approval to market a
product with orphan drug status can be advantageous, the scope of protection or
the level of marketing exclusivity that is currently afforded by orphan drug
status and marketing approval may not remain in effect in the future.

Our business strategy could involve obtaining orphan drug designation for
certain of the products we have under development. We do not know whether any of
our products will receive an orphan drug designation with the FDA and EMEA.
Orphan drug designation does not prevent other manufacturers from attempting to
develop the same drug for the designated indication or from obtaining the
approval of a new drug application for their drug prior to the approval of our
new drug application. If another sponsor's new drug application for the same
drug and the same indication is approved first, that sponsor is entitled to
exclusive marketing rights if that sponsor has received orphan drug designation
for its drug. In that case, the FDA would refrain from approving an application
by us to market our competing product for seven years, subject to limitations.
Competing products may not receive orphan drug designations and FDA marketing
approval before the products under development by us.

New drug application approval of a drug with an orphan drug designation does not
prevent the FDA from approving the same drug for a different indication, or a
molecular variation of the same drug for the same indication. Because doctors
are not restricted by the FDA from prescribing an approved drug for uses not
approved by the FDA, it is also possible that another company's drug could be
prescribed for indications for which products developed by us have received
orphan drug designation and new drug application approval. Prescribing of
approved drugs for unapproved uses, commonly referred to as "off label" use,
could adversely affect the marketing potential of products that have received an
orphan drug designation and new drug application approval. In addition, new drug
application approval of a drug with an orphan drug designation does not provide
any marketing exclusivity in foreign markets.

The possible amendment of the Orphan Drug Act by the United States Congress has
been the subject of frequent discussion. Although no significant changes to the
Orphan Drug Act have been made for a number of years, members of Congress have
from time to time proposed legislation that would limit the application of the
Orphan Drug Act. The precise scope of protection that may be afforded by orphan
drug designation and marketing approval may be subject to change in the future.

THE USE OF OUR PRODUCTS MAY BE LIMITED OR ELIMINATED BY PROFESSIONAL GUIDELINES
WHICH WOULD DECREASE OUR SALES OF THESE PRODUCTS AND, THEREFORE, OUR REVENUE AND
CASH FLOWS.

In addition to government agencies, private health/science foundations and
organizations involved in various diseases may also publish guidelines or
recommendations to the healthcare and patient communities. These private
organizations may make recommendations that affect the usage of therapies, drugs
or procedures, including products developed by us. These recommendations may
relate to matters such as usage, dosage, route of administration and use of
concomitant therapies. Recommendations or guidelines that are followed by
patients and healthcare providers and that result in, among other things,
decreased use or elimination of products developed by us could have a material
adverse effect on our revenue and cash flows.

WE RELY ON LICENSING OR PURCHASING PRODUCTS AND TECHNOLOGIES TO GROW OUR PRODUCT
PORTFOLIO, AND MAY NOT BE EFFECTIVE IN LICENSING OR ACQUIRING NEW PRODUCTS WHICH
WOULD ADVERSELY AFFECT OUR ABILITY TO GROW OUR BUSINESS AND BECOME PROFITABLE.


                                     - 18 -
<PAGE>

We have adopted a license and acquisition strategy to build our product
portfolio. Unless and until we develop and introduce a sufficient number of our
own products, we must rely upon the availability for licensing or purchasing of
products or technologies of other pharmaceutical or biotechnology companies. Our
success in executing this strategy depends on our continued ability to identify
and acquire new pharmaceutical products targeted at niche markets within
selected strategic therapeutic market segments. Other companies, including those
with substantially greater financial, marketing and other resources than us,
compete with us for the right to license or acquire these products. We may not
be successful in identifying potential product licensing or acquisition
opportunities. If any of these opportunities are identified, we may not be able
to obtain these licenses or complete these acquisitions on acceptable terms. We
may not be able to successfully integrate any licensed or acquired products or
technologies into our product portfolio. Our failure to obtain licenses for, or
complete acquisitions of, products or technologies within a selected strategic
therapeutic market segment or to promote and market commercially successful
products or technologies within an existing strategic therapeutic market segment
could have a material adverse effect on our ability to grow our business and
become profitable. Once we have obtained rights to a product or technology and
committed to payment terms, we may not be able to generate sales sufficient to
create a profit or otherwise avoid a loss. Any inability to generate sufficient
sales or any subsequent reduction of sales could have a material adverse effect
on our revenue and cash flows.

GENERIC PRODUCTS WHICH THIRD PARTIES MAY DEVELOP MAY RENDER OUR PRODUCTS
NONCOMPETITIVE OR OBSOLETE.

An increase in competition from generic pharmaceutical products could have a
material adverse effect on our ability to generate revenue and cash flow.

BECAUSE MANY OF OUR COMPETITORS HAVE SUBSTANTIALLY GREATER CAPABILITIES AND
RESOURCES, THEY MAY BE ABLE TO DEVELOP PRODUCTS BEFORE US OR DEVELOP MORE
EFFECTIVE PRODUCTS OR MARKET THEM MORE EFFECTIVELY WHICH WOULD LIMIT OUR ABILITY
TO GENERATE REVENUE AND CASH FLOW.

Competition in our industry is intense. Potential competitors in the United
States and Europe are numerous and include pharmaceutical, chemical and
biotechnology companies, most of which have substantially greater capital
resources, marketing experience, research and development staffs and facilities
than us. Although we seek to limit potential sources of competition by
developing products that are eligible for orphan drug designation and new drug
application approval or other forms of protection, our competitors may develop
similar technologies and products more rapidly than us or market them more
effectively. Competing technologies and products may be more effective than any
of those that are being or will be developed by us. The generic drug industry is
intensely competitive and includes large brand name and multi-source
pharmaceutical companies. Because generic drugs do not have patent protection or
any other market exclusivity, our competitors may introduce competing generic
products, which may be sold at lower prices or with more aggressive marketing.
Conversely, as we introduce branded drugs into our product portfolio, we will
face competition from manufacturers of generic drugs which may claim to offer
equivalent therapeutic benefits at a lower price. The aggressive pricing
activities of our generic competitors could have a material adverse effect on
our revenue and cash flow.

IF WE FAIL TO KEEP UP WITH RAPID TECHNOLOGICAL CHANGE AND EVOLVING THERAPIES,
OUR TECHNOLOGIES AND PRODUCTS COULD BECOME LESS COMPETITIVE OR OBSOLETE.

The pharmaceutical industry is characterized by rapid and significant
technological change. We expect that pharmaceutical technology will continue to
develop rapidly, and our future success will depend on our ability to develop
and maintain a competitive position. Technological development by others may
result in products developed by us, branded or generic, becoming obsolete before
they are marketed or before we recover a significant portion of the development
and commercialization expenses incurred with respect to these products.
Alternative therapies or new medical treatments could alter existing treatment
regimes, and thereby reduce the need for one or more of the products developed
by us, which would adversely affect our revenue and cash flow

WE PRIMARILY DEPEND ON OTHERS FOR CLINICAL TESTING OF OUR PRODUCTS WHICH COULD
DELAY OUR ABILITY TO DEVELOP PRODUCTS.

We do not currently have any internal product testing capabilities, although one
of our subsidiaries is in the process of acquiring some product testing
capabilities. Our inability to retain third parties for the clinical testing of
products on acceptable terms would adversely affect our ability to develop
products. Any failures by third parties to adequately perform their
responsibilities may delay the submission of products for regulatory approval,
impair our ability to deliver products on a timely basis or otherwise impair our
competitive position. Our dependence on third parties for the development of
products may adversely affect our potential profit margins and our ability to
develop and deliver products on a timely basis.


                                     - 19 -
<PAGE>

WE DEPEND ON OTHERS TO MANUFACTURE OUR PRODUCTS AND HAVE NOT MANUFACTURED THEM
IN SIGNIFICANT QUANTITIES.

We have never manufactured any products in commercial quantities, and the
products being developed by us may not be suitable for commercial manufacturing
in a cost-effective manner. Manufacturers of products developed by us will be
subject to current good manufacturing practices prescribed by the FDA or other
rules and regulations prescribed by foreign regulatory authorities. We may not
be able to enter into or maintain relationships either domestically or abroad
with manufacturers whose facilities and procedures comply or will continue to
comply with current good manufacturing practices or applicable foreign
requirements. Failure by a manufacturer of our products to comply with current
good manufacturing practices or applicable foreign requirements could result in
significant time delays or our inability to commercialize or continue to market
a product and could have a material adverse effect on our sales of products and,
therefore, our cash flow. In the United States, failure to comply with current
good manufacturing practices or other applicable legal requirements can lead to
federal seizure of violative products, injunctive actions brought by the federal
government, and potential criminal and civil liability on the part of a company
and our officers and employees.

WE HAVE LIMITED SALES AND MARKETING CAPABILITY, AND MAY NOT BE SUCCESSFUL IN
SELLING OR MARKETING OUR PRODUCTS.

The creation of infrastructure to commercialize oncology products is a
difficult, expensive and time-consuming process. We currently have very limited
sales and marketing capabilities, and intend to rely upon third parties to
perform those functions. To the extent that we enter into co- promotion or other
licensing arrangements, any revenues to be received by us will be dependent on
the efforts of third parties. The efforts of third parties may not be
successful. We may not be able to establish direct or indirect sales and
distribution capabilities or be successful in gaining market acceptance for
proprietary products or for other products. If we desire to market any products
directly, we will need to develop a more fulsome marketing and sales force with
technical expertise and distribution capability or contract with other
pharmaceutical and/or health care companies with distribution systems and direct
sales forces. Our failure to establish marketing and distribution capabilities
or to enter into marketing and distribution arrangements with third parties
could have a material adverse effect on our revenue and cash flows.

WE DEPEND ON PATENT AND PROPRIETARY RIGHTS TO DEVELOP AND PROTECT OUR
TECHNOLOGIES AND PRODUCTS, WHICH RIGHTS MAY NOT OFFER US SUFFICIENT PROTECTION.

The pharmaceutical industry places considerable importance on obtaining patent
and trade secret protection for new technologies, products and processes. Our
success will depend on our ability to obtain and enforce protection for products
that we develop under United States and foreign patent laws and other
intellectual property laws, preserve the confidentiality of our trade secrets
and operate without infringing the proprietary rights of third parties. Through
license agreements, we seek to acquire the right to utilize the technology
covered by issued patents and patent applications, as well as additional
intellectual property and know-how that could be the subject of further patent
applications in the future. Patents may not be issued from these applications
and issued patents may not give us adequate protection. Issued patents may be
challenged, invalidated, infringed or circumvented, and any rights granted
therunder may not provide us with competitive advantages. Parties not affiliated
with us have obtained or may obtain United States or foreign patents or possess
or may possess proprietary rights relating to products being developed or to be
developed by us. Patents now in existence or hereafter issued to others may
adversely affect the development or commercialization of products developed or
to be developed by us. Our planned activities may infringe patents owned by
others.

We could incur substantial costs in defending infringement suits brought against
us or any of our licensors or in asserting any infringement claims that we may
have against others. We could also incur substantial costs in connection with
any suits relating to matters for which we have agreed to indemnify our
licensors or distributors. An adverse outcome in any litigation could have a
material adverse effect on our ability to sell products or use patents in the
future. In addition, we could be required to obtain licenses under patents or
other proprietary rights of third parties. These licenses may not be made
available on terms acceptable to us, or at all. If we are required to, and do
not obtain any required licenses, we could be prevented from, or encounter
delays in, developing, manufacturing or marketing one or more products.


                                     - 20 -
<PAGE>

We also rely upon trade secret protection for our confidential and proprietary
information. Others may independently develop substantially equivalent
proprietary information and techniques or gain access to our trade secrets or
disclose our technology. We may not be able to meaningfully protect our trade
secrets which could limit our ability to exclusively produce products.

We require our employees, consultants, members of the scientific advisory board
and parties to collaborative agreements to execute confidentiality agreements
upon the commencement of employment or consulting relationships or a
collaboration with us. These agreements may not provide meaningful protection of
our trade secrets or adequate remedies in the event of unauthorized use or
disclosure of confidential and proprietary information.

IF WE LOSE KEY MANAGEMENT OR OTHER PERSONNEL OUR BUSINESS WILL SUFFER.

We are highly dependent on the principal members of our scientific and
management staff. We seek to develop and manage our business on a cost-
effective basis, with limited overhead, and one principal means of doing so is
to rely upon a relatively small management team. We also rely on consultants and
advisors, including our scientific advisors, to assist us in formulating our
research and development strategy. Our success also depends upon retaining key
management and technical personnel, as well as our ability to continue to
attract and retain additional highly-qualified personnel. We face intense
competition for personnel from other companies, government entities and other
organizations. We may not be successful in retaining our current personnel. We
may not be successful in hiring or retaining qualified personnel in the future.
If we lose the services of any of our scientific and management staff or key
technical personnel, or if we fail to continue to attract qualified personnel,
our ability to acquire, develop or sell products would adversely affected.

OUR MANAGEMENT AND INTERNAL SYSTEMS MIGHT BE INADEQUATE TO HANDLE OUR POTENTIAL
GROWTH.

Our success will depend in significant part on the expansion of our operations
and the effective management of growth. This growth will place a significant
strain on our management and information systems and resources and operational
and financial systems and resources. To manage future growth, our management
must continue to improve our operational and financial systems and expand,
train, retain and manage our employee base. Our management may not be able to
manage our growth effectively. If our systems, procedures, controls, and
resources are inadequate to support our operations, our expansion would be
halted and we could lose our opportunity to gain significant market share. Any
inability to manage growth effectively may harm our ability to institute our
business plan.

BECAUSE WE HAVE INTERNATIONAL OPERATIONS, WE WILL BE SUBJECT TO RISKS OF
CONDUCTING BUSINESS IN FOREIGN COUNTRIES.

Because we have international operations in the conduct of our business, we are
subject to the risks of conducting business in foreign countries, including:

* difficulty in establishing or managing distribution relationships;

* different standards for the development, use, packaging and marketing of our
products and technologies;

* our inability to locate qualified local employees, partners, distributors and
suppliers;

* the potential burden of complying with a variety of foreign laws, trade
standards and regulatory requirements, including the regulation of
pharmaceutical products and treatment; and

* general geopolitical risks, such as political and economic instability,

WE CANNOT PREDICT OUR FUTURE CAPITAL NEEDS AND WE MAY NOT BE ABLE TO SECURE
ADDITIONAL FINANCING WHICH COULD AFFECT OUR ABILITY TO OPERATE AS A GOING
CONCERN.

We will need additional financing to continue to fund the research and
development of our products and to generally expand and grow our business. To
the extent that we will be required to fund operating losses, our financial
position would deteriorate. There can be no assurance that we will be able to
find significant additional financing at all or on terms favorable to us. If
equity securities are issued in connection with a financing, dilution to our
stockholders may result, and if additional funds are raised through the
incurrence of debt, we may be subject to restrictions on our operations and
finances. Furthermore, if we do incur additional debt, we may be limiting our
ability to repurchase capital stock, engage in mergers, consolidations,
acquisitions and asset sales, or alter our lines of business or accounting
methods, even though these actions would otherwise benefit our business.


                                     - 21 -
<PAGE>

If adequate financing is not available, we may be required to delay, scale back
or eliminate some of our research and development programs, to relinquish rights
to certain technologies or products, or to license third parties to
commercialize technologies or products that we would otherwise seek to develop.
Any inability to obtain additional financing, if required, would have a material
adverse effect on our ability to continue our operations and implement our
business plan.

THE PRICES WE CHARGE FOR OUR PRODUCTS AND THE LEVEL OF THIRD-PARTY REIMBURSEMENT
MAY DECREASE AND OUR REVENUES COULD DECREASE.

Our ability to commercialize products successfully depends in part on the price
we may be able to charge for our products and on the extent to which
reimbursement for the cost of our products and related treatment will be
available from government health administration authorities, private health
insurers and other third-party payors. Government officials and private health
insurers are increasingly challenging the price of medical products and
services. Significant uncertainty exists as to the pricing flexibility
distributors will have with respect to, and the reimbursement status of, newly
approved health care products.

In the United States, for instance, we expect that there will continue to be a
number of federal and state proposals to implement government control of pricing
and profitability of prescription pharmaceuticals. Government imposed controls
could decrease the price we receive for products by preventing the recovery of
development costs and an appropriate profit margin. Any of these cost controls
could have a material adverse effect on our ability to make a profit.
Furthermore, federal and state regulations govern or influence the reimbursement
to health care providers in connection with medical treatment of certain
patients. If any actions are taken by federal and/or state governments, they
could adversely affect the prospects for sales of our products.

ACTIONS TAKEN BY FEDERAL AND/OR STATE GOVERNMENTS WITH REGARD TO HEALTH CARE
REFORM COULD HAVE A MATERIAL ADVERSE EFFECT ON OUR BUSINESS AND OUR PROSPECTS.

Third-party payors may attempt to control costs further by selecting exclusive
providers of their pharmaceutical products. If third-party payors were to make
this type of arrangement with one or more of our competitors, they would not
reimburse patients for purchasing our competing products. This could cause the
acceptance and/or use of our products to decline. This lack of reimbursement
would diminish the market for products developed by us and could have a material
adverse effect on us.

OUR PRODUCTS MAY BE SUBJECT TO RECALL.

Product recalls may be issued at our discretion or by the FDA, the FTC or other
government agencies having regulatory authority for product sales. Product
recalls, if any in the future, may harm our reputation and cause us to lose
development opportunities, or customers or pay refunds. Products may need to be
recalled due to disputed labeling claims, manufacturing issues, quality defects,
or other reasons. We do not carry any insurance to cover the risk of potential
product recall. Any product recall could have a material adverse effect on us,
our prospects, our financial condition and results of operations.

WE MAY FACE EXPOSURE FROM PRODUCT LIABILITY CLAIMS AND PRODUCT LIABILITY
INSURANCE MAY NOT BE SUFFICIENT TO COVER THE COSTS OF OUR LIABILITY CLAIMS
RELATED TO TECHNOLOGIES OR PRODUCTS.

We face exposure to product liability claims if the use of our technologies or
products or those we license from third parties is alleged to have resulted in
adverse effects to users thereof. Regulatory approval for commercial sale of our
products does not mitigate product liability risks. Any precautions we take may
not be sufficient to avoid significant product liability exposure. Although we
intend to obtain and maintain product liability insurance on our technologies
and products at levels with which management deems reasonable, no assurance can
be given that this insurance will cover any particular claim or that we will
obtain an appropriate level of liability insurance coverage for our development
and marketing activities. Existing coverage may not be adequate as we further
develop our products. In the future, adequate insurance coverage or


                                     - 22 -
<PAGE>

indemnification by collaborative partners may not be available in sufficient
amounts, or at acceptable costs, if at all. To the extent that product liability
insurance, if available, does not cover potential claims, we will be required to
self-insure the risks associated with those claims. The successful assertion of
any uninsured product liability or other claim against us could limit our
ability to sell our products or could cause monetary damages. In addition,
future product labeling may include disclosure of additional adverse effects,
precautions and contraindications, which may adversely impact product sales. The
pharmaceutical industry has experienced increasing difficulty in maintaining
product liability insurance coverage at reasonable levels, and substantial
increases in insurance premium costs in many cases have rendered coverage
economically impractical.

WE MAY BE LIABLE FOR THE USE OF HAZARDOUS MATERIALS.

Our research and development activities may involve the use of hazardous
materials, chemicals and/or various radioactive compounds by our collaborative
partners. The risk of accidental contamination or injury from these materials
cannot be completely eliminated. In the event of an accident, we could be held
liable for any damages that result and any liability could exceed our resources.
Our future collaborative partners may incur substantial costs to comply with
environmental regulations, which costs may be passed on to us.

WE MAY ENCOUNTER SIGNIFICANT FINANCIAL AND OPERATING RISKS IF WE GROW OUR
BUSINESS THROUGH ACQUISITIONS.

As part of our growth strategy, we may seek to acquire or invest in
complementary or competitive businesses, products or technologies. The process
of integrating acquired assets into our operations may result in unforeseen
operating difficulties and expenditures and may absorb significant management
attention that would otherwise be available for the ongoing development of our
business. We may allocate a significant portion of our available working capital
to finance all or a portion of the purchase price relating to possible
acquisitions although we have no immediate plans to do so. Any future
acquisition or investment opportunity may require us to obtain additional
financing to complete the transaction. The anticipated benefits of any
acquisitions may not be realized. In addition, future acquisitions by us could
result in potentially dilutive issuances of equity securities, the incurrence of
debt and contingent liabilities and amortization expenses related to goodwill
and other intangible assets, any of which could materially adversely affect our
operating results and financial position. Acquisitions also involve other risks,
including entering markets in which we have no or limited prior experience. The
price of our common stock is likely to be volatile and subject to wide
fluctuations.

The market price of the securities of biotechnology companies has been
especially volatile. Thus, the market price of our common stock is likely to be
subject to wide fluctuations. If our revenues do not grow or grow more slowly
than we anticipate, or, if operating or capital expenditures exceed our
expectations and cannot be adjusted accordingly, or if some other event
adversely affects us, the market price of our common stock could decline. In
addition, if the market for pharmaceutical and biotechnology stocks or the stock
market in general experiences a loss in investor confidence or otherwise fails,
the market price of our common stock could fall for reasons unrelated to our
business, results of operations and financial condition. The market price of our
stock also might decline in reaction to events that affect other companies in
our industry even if these events do not directly affect us. In the past,
companies that have experienced volatility in the market price of their stock
have been the subject of securities class action litigation. If we were to
become the subject of securities class action litigation, it could result in
substantial costs and a diversion of management's attention and resources.

ITEM 2 - DESCRIPTION OF PROPERTY

Our principal executive offices are located at 712 Fifth Avenue, 19th Floor, New
York, New York, 10019-4108. Our telephone number there is 646 723 8946. We
occupy 5,000 square feet of office space at Savannah House, Charles II Street,
London telephone +44 (0) 207 451 2478. The premises are held on a three-year
lease from July 28, 2004. Part of the space is currently sublet on monthly
licenses generating income of $18,000 per month, including contributions to
rates and service charges. The total rent rates and service charges payable are
approximately $39,000 per month.

ITEM 3 - LEGAL PROCEEDINGS

The Company is not a party to any material pending legal proceedings. No such
action is contemplated by the Company nor, to the best of its knowledge, has any
action been threatened against the Company.

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

No matter has been submitted to a vote of security holders during the period
covered by this report, through the solicitation of proxies or otherwise, except
that the acquisition of Bioaccelerate, Inc., described below, was approved by
written consent of a majority interest of shareholders on September 23, 2004.


                                     - 23 -
<PAGE>

On August 6, 2004, the Registrant announced that it had entered into an
agreement to acquire all of the issued and outstanding common stock of
Bioaccelerate, Inc., a Delaware corporation. The transaction involved, , a name
change for the Company , change of management, relocation of the corporate
office and a 3.5 to 1 reverse stock split.

This transaction (the "Acquisition") was completed on September 23, 2004, along
with the effectuation of a 3.5 to 1 reverse split of the Registrant's
outstanding common stock reducing its pre-acquisition outstanding common shares
from 4,812,800 to 1,375,085. Pursuant to the Acquisition, the Registrant issued
32,325,000 common shares to the shareholders of Bioaccelerate, Inc., in a
nonpublic issuance exempt from the registration requirements of the Securities
Act of 1933, as amended, pursuant to Section 4(1), Section 4(6) and/or
Regulation D. The shareholders were all accredited investors. After the issuance
of the 32,325,000 shares of the Registrant's authorized but unissued common
stock in the Acquisition, to the former shareholders of Bioaccelerate, Inc., the
Registrant has 33,700,085 shares of its common stock issued and outstanding. The
Registrant also (1) changed its corporate name from Mobile Design Concepts, Inc.
to Bioaccelerate Holdings, Inc., (2) changed its corporate address to New York ,
and (3) had a complete change of corporate officers and directors. As a part of
the Acquisition, Lynn Dixon resigned effective September 23, 2004, as the sole
officer and director of the Registrant and a new Board of Directors was elected
and new officers were appointed. The following two persons were appointed as the
principal executive, financial, operating, and accounting officers of the
Registrant. Lee Cole 44 CEO, President & Director, Linden Boyne 61 CFO,
Secretary-Treasurer & Director


                                     - 24 -
<PAGE>

                                     PART II

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

On September 23, 2004. The Company began trading on the Over-The- Counter
("OTC") market and quoted on the Electronic Bulletin Board (the "Bulletin
Board") under the ticker symbol "BACL". The trading volume of the common stock
is limited. This limited trading volume creates the potential for significant
changes in the trading price of the common stock as a result of a relatively
minor changes in the supply and demand. It is likely that trading prices will
fluctuate in the future without regard to our business activities.

The following table presents the high and low bid quotations for the Common
Stock as reported by the OTC Bulletin Board for each quarter during the year
ended December 31, 2004. Such prices reflect inter-dealer quotations without
adjustments for retail markup, markdown or commission, and do not necessarily
represent actual transactions. There has been no solicitation of the sale or
purchase of the Common Stock. The price for the common stock has approximately
ranged in price as follows:

                    2004:                             HIGH             LOW
                                                        $               $
       Quarter Ended March 31, 2004                     --              --
       Quarter Ended June 30, 2004                    1.40            1.40
       Quarter Ended September 30, 2004              14.00            1.40
       Quarter Ended December, 31, 2004              14.00           10.75

STOCKHOLDERS

There are approximately 150 shareholders of record of our common stock.

DIVIDENDS

The Company has not paid any dividends to date and does not plan to pay
dividends in the foreseeable future.

SECURITIES AUTHORIZED FOR ISSUANCE UNDER EQUITY COMPENSATION PLANS

The company has made allocation for up to ten percent of the stock for
allocation to staff and officers under authorized equity compensation plans;
however no plan was instigated in the reported year while the company was
established . It is expected that a plan will be submitted to the Board for
approval and implementation early in the next financial year.

ITEM 6 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION OR PLAN OF
OPERATION

FORWARD LOOKING STATEMENTS

This Form 10-KSB contains forward-looking statements. Such statements consist of
any statement other than a recitation of historical facts and can be identified
by words such as may, expect, anticipate, estimate, hopes, believes, continue,
intends, seeks, contemplates, suggests, envisions or comparable language. These
forward-looking statements are based largely on our expectations and are subject
to a number of risks and uncertainties, including but not limited to: those
risks associated with our ability to identify and raise additional capital to
complete our product development programs; our ability to raise, and our
allocation of, resources as necessary to continue operations; our ability to
generate cash flow from revenue or other sources; our ability to use our capital
stock for acquisitions, paying expenses or other disbursements, attracting
personnel or contractors and other business uses. Many of these factors are
beyond our management's control. These uncertainties could cause our actual
results to differ materially from the expectations reflected in these
forward-looking statements. In light of these risks and uncertainties, we cannot
be certain that the forward-looking information contained in this annual report
on Form 10-KSB will, in fact, occur. Potential investors should consider
carefully the previously stated factors, as well as the more detailed
information contained elsewhere in this Form 10-KSB, before making a decision to
invest in our common stock.


                                     - 25 -
<PAGE>

The following is a discussion of our financial condition and results of
operations as of the date of this Form 10-KSB. This discussion and analysis
should be read in conjunction with the accompanying audited Financial Statements
of the Company, including the Notes thereto, which are included elsewhere
herein.

GENERAL

Management's Discussion and Analysis presents a review of our consolidated
operating results and financial condition for the periods ended December 31,
2004 and May 31, 2004. This discussion and analysis is intended to assist in
understanding the financial information of the Company presented elsewhere
herein. This section should be read in conjunction with our consolidated
financial statements and the related notes, as well as ITEM 1. Description of
Business of this Form 10-KSB.

CRITICAL ACCOUNTING POLICIES

Our discussion and analysis of our financial condition and results of operations
are based upon our financial statements, which have been prepared in accordance
with accounting principles generally accepted in the United States. The
preparation of these financial statements requires us to make estimates and
judgments that affect the reported amounts of assets, liabilities, revenues and
expenses. In consultation with our Board of Directors, we have identified two
accounting principles that we believe are key to an understanding of our
financial statements. These important accounting policies require management's
most difficult, subjective judgments.

(1) STOCK BASED COMPENSATION

The Company accounts for equity instruments issued to employees for services
based on the fair value of the equity instruments issued and accounts for equity
instruments issued to other than employees based on the fair value of the
consideration received or the fair value of the equity instruments, whichever is
more reliably measurable.

The Company accounts for stock based compensation in accordance with SFAS 123,
"Accounting for Stock-Based Compensation." The provisions of SFAS 123 allow
companies to either expense the estimated fair value of stock options or to
continue to follow the intrinsic value method set forth in APB Opinion 25,
"Accounting for Stock Issued to Employees" (APB 25) but disclose the pro forma
effects on net income (loss) had the fair value of the options been expensed.
The Company has elected to continue to apply APB 25 in accounting for its stock
option plans.

(2) RESEARCH AND DEVELOPMENT

The Company conducts its research and development with numerous academic
research facilities, other biotechnology companies and clinical research
organizations. Such expenses are expense as incurred. Any disruption in the
Company's relationship with these entities could have a material impact on the
Company's future operations.

RESULTS OF OPERATIONS

Bioaccelerate Holdings, Inc. (the "Company") is a pharmaceutical development
organization ("PDO") seeking to acquire, develop and commercialize novel
pharmaceutical products in an efficient, cost-effective way. The Company uses
its broad network of academic, industry and capital market relationships to
expedite drug development and raise capital to create and fund its subsidiary
companies, which are organized by vertical portfolios in five therapeutic areas:
cancer, lifestyle disorders, central nervous system disorders (CNS),
cardiovascular disease and anti- infectives. The markets for drugs in these five
areas have a combined global value of more than $200 billion a year, according
to Reuters Business Insight.

The Company has not generated revenues and is considered a development stage
company as defined in Statement of Financial Accounting Standards No. 7.

During the seven months ended December 31, 2004, work continued on the product
development programs as planned and the individual items are detailed below. The
period ended December 31, 2004, compared to the year ended May 31, 2004:

General and administrative expenses increased from $1,180,681 in the year ended
May 31, 2004, to $3,192,130 in period to December 31, 2004. The main reasons for
the increase were the consolidation of Enhance Biotech, Inc in the financial
statements and the further development of the Company's infrastructure to
support its planned growth. Additional staff including two new Directors
recruited during the year to accelerate development of our range of existing
clinical and pre clinical compounds. Consultants continue to be engaged with
specialist areas to assist our permanent staff.


                                     - 26 -
<PAGE>

Research & Development expenses for the seven months ended December 31, 2004,
were $41,960,380 as compared with $717,694 in the previous year. The main
reasons for the increase was the full consolidation of Enhance Biotech, Inc,
which involved expensing the In-Process R&D acquired, and Evolve Oncology, Inc
into the accounts and additional expenses in connection with the development of
several of our product candidates in five therapeutic areas and also in the
identification of additional portfolio compounds.

Our expenses have consisted primarily of costs incurred from in-licensing
existing product candidates, research and development of new product candidates,
development of our collaboration product agreements, and general and
administrative costs associated with our operations. We expect licensing costs
to increase as development milestones are achieved, and our research and
development expenses to increase as we continue to develop our product
candidates. If the development efforts result in clinical success, regulatory
approval and successful commercialization of our products, we will generate
revenues from sales of these products and from receipt of royalties on sales of
these products. We expect to incur sales and marketing expenses in the future as
we establish our sales and marketing organization.

Since our inception we have incurred significant losses. As of December 2004, we
had an accumulated deficit of $160,569,414. We anticipate incurring additional
losses, which may increase for the foreseeable future, including at least
through December 31, 2008.

We have a limited history of operations. We anticipate that our quarterly
results of operations will fluctuate for the foreseeable future due to several
factors, including payments made or received pursuant to licensing or
collaboration agreements, progress of our research and development efforts, and
the timing and outcome of regulatory approvals. Our limited operating history
makes predictions of future operations difficult or impossible to ascertain.

OUR 12 MONTH PLAN OF OPERATIONS SUBJECT TO ADEQUATE FINANCING

We plan to continue development all the compounds in our portfolio subject to
critical review by our management. Our use of the latest technologies to cuts
development costs and reduces the amount of time that a compound spends in
development. We will use the expertise and market knowledge of our in house
scientific and business management to develop synergies and establish
collaborative agreements. We anticipate that the Credit facilities we have in
place will enable to continue to programme as planned.

LIQUIDITY & CAPITAL RESOURCES

Since our inception, we have financed our operation through the sale of stock
and the issuance of debt. The Company has a $32,500,000 line of credit facility
as of December 31, 2004. $4,047,574 of the line is outstanding. The facility
accrues interest at the Applicable Federal Rate, as defined in Section 1247(d)
of the Internal Revenue Code. As of December 31, 2004, the interest rate was
1.5%. In February 2004, Bioaccelerate, Inc sold 5,100,000 shares of common stock
at $1.00 per share and received net proceeds of $4,816,781 after expenses. At
December 31, 2004 cash and cash equivalents totaled approximately $742,856. The
Company expects to incur substantial additional research and development
expenses and general administrative expenses, including personal-related costs,
cost related to preclinical testing and clinical trials. The Company intends to
seek additional funding through the sale of debt and equity securities,
increases in our credit facilities and with suitable potential collaborators


                                     - 27 -
<PAGE>

BASIS OF PRESENTATION

The Company's financial statements are presented on a going concern basis, which
contemplates the realization of assets and satisfaction of liabilities in the
normal course of business.

The Company has experienced a significant loss from operations aggregating
$157,147,264, $2,100,238 and $160,096,166, for the seven months ended December
31, 2004, for the year ended May 31, 2004, and the period from inception to
December 31, 2004. In addition, the Company has working capital and stockholder
deficits at December 31, 2004, of $9,464,214 and $11,702,694 and has no revenue
generating operations.

The Company's ability to continue as a going concern is contingent upon its
ability to secure additional financing, utilize its credit facilities, increase
ownership equity and attain profitable operations. In addition, the Company's
ability to continue as a going concern must be considered in light of the
problems, expenses and complications frequently encountered in established
markets and the competitive environment in which the Company operates.

The Company is pursuing financing for its operations and seeking additional
investments. In addition, the Company is seeking to establish a revenue base.
Failure to secure such financing or to raise additional equity capital and to
establish a revenue base may result in the Company depleting its available funds
and not being able pay its obligations.

The financial statements do not include any adjustments to reflect the possible
future effects on the recoverability and classification of assets or the amounts
and classification of liabilities that may result from the possible inability of
the Company to continue as a going concern.


                                     - 28 -
<PAGE>

ITEM 7. FINANCIAL STATEMENTS

Index to Consolidated Financial Statements

                                                                            Page

Accountants Reports                                                          30

Balance Sheets as of December 31, 2004                                       32

Statements of Operations for the years ended December 31, 2004, and
  since Inception                                                            33

Statements of Stockholders'(Deficit) from Inception                          34

Statements of Cash Flows for the periods ended December 31, 2004,May 31 2004
And since Inception.                                                         35

Notes to the Consolidated Financial Statements                               36


                                     - 29 -
<PAGE>


             REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

Stockholders and Board of Directors
Bioaccelerate Holdings, Inc.

We have audited the accompanying consolidated balance sheet of Bioaccelerate
Holdings, Inc. (a Development Stage Company) as of December 31, 2004, and the
related consolidated statements of operations, stockholders' (deficit) and cash
flows for the seven months ended December 31, 2004. These financial statements
are the responsibility of the Company's management. Our responsibility is to
express an opinion on these financial statements based on our audit.

We conducted our audit in accordance with auditing standards of the Public
Company Accounting Oversight Board (United States). Those standards require that
we plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. 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 by management, as well as evaluating
the overall financial statement presentation. We believe that our audit provides
a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Bioaccelerate Holdings, Inc. (a
Development Stage Company) as of December 31, 2004, and results of its
operations and its cash flows for the seven months ended December 31, 2004, in
conformity with accounting principles generally accepted in the United States of
America.

As discussed in Note 17, the Company has restated the financial statements for
the period ended December 31, 2004 to correct an error in related to the
consolidation of Enhance Biotech, Inc. pursuant to FIN 46R.

The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As discussed in Note 3 to the
financial statements, the Company has incurred significant losses from
operations and has a working capital deficit and no revenue generating
operations. These factors raise substantial doubt about the Company's ability to
continue as a going concern. Management's plans in regard to this matter are
also discussed in Note 3. The financial statements do not include any
adjustments that might result from the outcome of this uncertainty.


Stark Winter Schenkein & Co., LLP

/s/ Stark Winter Schenkein & Co., LLP
-------------------------------------

Denver, Colorado
June 2, 2005, except for Note 17 as to which the
Date is July 1, 2005


                                     - 30 -
<PAGE>

REPORT OF INDEPENDENT AUDITORS

To the Board of Directors and Stockholders of BIOACCELERATE INC.

I have audited the accompanying balance sheet of Bioaccelerate Inc., (a
development stage company) as of May 31, 2004 and the related statements of
loss, cash flows and shareholders' equity (deficiency), for the year ended May
31, 2004, and for the period from December 29, 1995 (inception) to May 31, 2004.
These financial statements are the responsibility of the Company's management.
Our responsibility is to express an opinion on these financial statements based
on my audit.

I conducted my audit in accordance with generally accepted auditing standards.
Those standard require that I 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.
I believe that my audit provides a reasonable basis for my opinion.

In my opinion, the financial statements referred to above present fairly, in all
material respects, the financial position of Bioaccelerate Inc., as of May 31,
2004, and the results of its operations and its cash flows for the year then
ended May 31, 2004 and for the period from December 29, 1995 (inception) to May
31, 2004 in conformity with generally accepted accounting principles. The
accompanying financial statements have been prepared assuming that the Company
will continue as a going concern. The Company has losses from operations and a
net capital deficiency, which raise substantial doubt about its ability to
continue as a going concern.

F.E. Hanson, Ltd
Arlington, VA.
October 14,2004


                                     - 31 -
<PAGE>

                          BIOACCELERATE HOLDINGS, INC.
                          (A Development Stage Company)
                           Consolidated Balance Sheet
                                December 31, 2004

ASSETS
Current Assets
          Cash and cash equivalents                               $     742,856
          Prepaid expenses                                              423,285
          Other accounts receivable                                     256,992
                                                                  -------------
            Total Current Assets                                      1,423,133
                                                                  -------------

Property and equipment, net                                           1,092,301
                                                                  -------------
Other Assets
          Other assets                                                  169,993
          Patents                                                       576,943
          Other long term investments                                 2,202,871
                                                                  -------------
                                                                      2,949,807
                                                                  -------------

                                                                  $   5,465,241
                                                                  =============
LIABILITIES AND STOCKHOLDERS' (DEFICIT)
Current Liabilities
          Bank loans and overdrafts                               $      36,874
          Accounts payable                                            4,253,034
          Accrued expenses                                            1,029,027
          Due to related parties                                      1,351,916
          Current portion of long-term debt                             119,042
          Loans payable                                               4,047,454
          Deferred revenues                                              50,000
                                                                  -------------
                                                                     10,887,347
                                                                  -------------

Deferred revenue                                                      1,200,000
Long-term debt                                                        5,080,588
                                                                  -------------
                                                                      6,280,588
                                                                  -------------
Stockholders' (Deficit)
          Preferred Stock, par value $.001;
           10,000,000 shares authorized;
           none issued and outstanding                                       --
          Common Stock, par value $.001;
           100,000,000 shares authorized;
            39,794,362 issued and outstanding                            39,794
          Additional paid in capital                                148,826,926
          (Deficit) accumulated in the development stage           (160,096,166)
          Other comprehensive (loss)
            Currency translation adjustment                            (473,248)
                                                                  -------------
               Total Stockholders' (Deficit)                        (11,702,694)
                                                                  -------------
                                                                  $   5,465,241
                                                                  =============

The accompanying notes are an integral part of these financial statements


                                     - 32 -
<PAGE>

                          BIOACCELERATE HOLDINGS, INC.
                          (A Development Stage Company)
         Consolidated Statements of Operations and Comprehensive Losses

<TABLE>
<CAPTION>
                                                                                                  From Inception
                                                            Seven Months                            November 1,
                                                                Ended               Year              1999 to
                                                            December 31,           Ended            December 31,
                                                                2004               May 31,              2004
                                                             (Restated)             2004             (Restated)
                                                           -------------       -------------       -------------
<S>                                                        <C>                 <C>                 <C>
Revenue                                                    $          --       $          --       $          --
                                                           -------------       -------------       -------------

Operating expenses
    Research and development                                  41,960,380             717,694          42,678,074
    General and administrative                                 3,192,130           1,180,681           5,221,475
    Non cash stock compensation - general
     and administrative                                       64,500,706                  --          64,500,706
                                                           -------------       -------------       -------------
                                                            (109,653,216)         (1,898,375)       (112,400,255)
                                                           -------------       -------------       -------------

Net operating (loss)                                        (109,653,216)         (1,898,375)       (112,400,255)
                                                           -------------       -------------       -------------

Other income (expenses)
    Share of losses in affiliate                                      --            (362,441)           (362,441)
    Non cash interest expense                                (36,931,308)                 --         (36,931,308)
    Minority interest share of losses in subsidiaries          6,820,830             160,578           6,981,408
    Impairment charges                                       (17,383,570)                 --         (17,383,570)
                                                           -------------       -------------       -------------
                                                              47,494,048            (201,863)        (47,695,911)
                                                           -------------       -------------       -------------

(Loss) attributable to common stockholders                  (157,147,264)         (2,100,238)       (160,096,166)

Other Comprehensive Income
    Foreign currency translation adjustments                    (312,621)           (160,627)           (473,248)

                                                           -------------       -------------       -------------
Comprehensive (Loss)                                       $ 157,459,885       $  (2,260,865)      $(160,569,414)
                                                           =============       =============       =============

Per share information - basic and diluted

Net (Loss) Per Common Share                                $       (4.72)      $       (0.09)
                                                           =============       =============

Weighted Average Number of Shares Outstanding                 33,302,214          22,259,059
                                                           =============       =============
</TABLE>

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


                                     - 33 -
<PAGE>

                           BIOACCELERATE HOLDINGS, INC
                          (A Development Stage Company)
                Consolidated Statement of Stockholders' (Deficit)
         Period From Inception (November 1, 1999) to December 31, 2004

<TABLE>

<CAPTION>
                                                     Common Stock          Additional                      Other          Total
                                                                            Paid In       Accumulated   Comprehensive  Stockholders'
                                                 Shares        Amount       Capital        (Deficit)       Income       (Deficit)
                                              ------------   ---------   -------------   -------------   ----------   -------------
<S>                                              <C>         <C>         <C>             <C>             <C>          <C>
Common shares issued for cash at $.0008 per
share                                            1,298,550   $   1,000   $          --   $          --   $       --   $       1,000

Net (loss) for the period ended May 31, 2003            --          --              --        (848,664)          --        (848,664)
                                              ------------   ---------   -------------   -------------   ----------   -------------
Balances as of May 31, 2003                      1,298,550       1,000              --        (848,664)          --        (847,664)

September 1, 2003 - Shares issued for
acquisition of Pharma Manufacturing
Services Limited at $.0008 per share            23,373,947      18,000              --              --           --          18,000

September 1, 2003 - Shares issued for
satisfaction of debt at $1.93 per share            811,612         811       1,561,724              --           --       1,562,535

Reclassification of paid in capital                     --       5,673          (5,673)             --           --              --

February, 2004 - Shares issued net of
funding costs for cash at $.73 per share         6,622,605       6,623       4,810,158              --           --       4,816,781

February 2, 2004 - Additional paid in
capital relating to shares issued by
subsidiary companies                                    --          --       8,879,507              --           --       8,879,507

May, 2004 - Shares issued for cash net of
funding costs at $.77 per share                    218,286         218         167,782              --           --         168,000

Net (loss) for the year ended May 31, 2004              --          --              --      (2,100,238)          --      (2,100,238)

Foreign currency translation adjustments                --          --              --              --     (160,627)       (160,627)
                                              ------------   ---------   -------------   -------------   ----------   -------------

Balances as of May 31, 2004                     32,325,000      32,325      15,413,498      (2,948,902)    (160,627)     12,336,294
                                              ------------   ---------   -------------   -------------   ----------   -------------

September 23, 2004 - Shares issued for the
net assets of Mobile Design Concepts, Inc.       1,375,086       1,375          23,444              --           --          24,819

December 2, 2004 - Shares issued for
services at $12.75 per share                     2,275,804       2,276      29,014,226              --           --      29,016,502

December 2, 2004 - Shares issued for
satisfaction of debt and payables of
$3,818,472 at $12.75 per share                   3,818,472       3,818      48,681,699              --           --      48,685,517

December 15, 2004 - Additional paid in
capital relating to share issuances by
subsidiary company                                      --          --      22,870,000              --           --      22,870,000

Shares issued for purchased research
and development by subsidiary                           --          --      32,824,059              --           --      32,824,259
Net of inter company items

Net (loss) for the seven months
ended December 31, 2004                                 --          --              --    (157,147,264)          --    (157,147,264)

Foreign currency translation adjustments                --          --              --              --     (316,621)       (312,621)
                                              ------------   ---------   -------------   -------------   ----------   -------------

Balances as of December 31, 2004 Restated       39,794,362   $  39,794   $ 148,826,926   $(160,096,166)  $ (473,248)  $ (11,702,694)
                                              ------------   ---------   -------------   -------------   ----------   -------------
</TABLE>

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


                                     - 34 -
<PAGE>

                          BIOACCELERATE HOLDINGS, INC.
                          (A Development Stage Company)
                      Consolidated Statements of Cash Flows

<TABLE>
<CAPTION>

                                                                                                        From
                                                                                                     Inception
                                                             Seven Months                           November 1,
                                                                Ended                                  1999 To
                                                             December 31,        Year Ended         December 31,
                                                                 2004              May 31,              2004
                                                             (Restated)             2004             (Restated)
                                                            -------------       -------------       -------------
<S>                                                         <C>                 <C>                 <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss                                                    $(157,147,264)      $  (2,100,238)      $(160,096,166)
Adjustments to reconcile net (loss) to net
cash provided by (used in) operating activities:
  Depreciation and amortization                                    24,058               1,665              25,723
  Shares of losses in affiliated companies                                            326,441             362,441
  Issuance of common stock for services and interest          101,432,014                  --         101,432,014
  Issuance of subsidiaries common stock for purchased
   research and development                                    32,824,059                  --          32,824,059
  Impairment charges                                           17,383,570                  --          17,383,570
Changes in operating assets and liabilities:
  (Increase) decrease in other current assets                     547,762            (227,051)            320,711
  Increase in other accounts receivable                          (276,222)                 --            (276,222)
  Increase in prepaid expenses                                   (423,285)                 --            (423,285)
  Increase in accounts payable                                  3,543,111             174,464           3,717,575
  Increase (decrease) in accrued expenses                         836,676             192,351           1,029,027
  Increase in other current liabilities                         4,215,982                  --           4,215,982
                                                            -------------       -------------       -------------
Net cash provided by (used in) operating activities             2,960,461          (1,596,368)            515,429
                                                            -------------       -------------       -------------

CASH FLOWS FROM INVESTING ACTIVITIES:
  Purchase of long term investments                            (3,589,472)                 --          (3,589,472)
  Purchase of property and equipment                           (1,655,892)            (50,480)         (1,706,372)
  Investment in affiliate                                              --          (4,001,815)         (4,001,815)
  Payment for purchase of subsidiaries
   - net of cash acquired                                                         (16,623,688)        (16,623,688)
                                                            -------------       -------------       -------------
Net cash (used in) investing activities                        (5,245,364)        (20,675,983)        (25,921,347)
                                                            -------------       -------------       -------------

CASH FLOWS FROM FINANCING ACTIVITIES:
  Issuance of common stock for cash                                    --          15,445,820          15,445,820
  Bank overdraft                                                   36,874                  --              36,874
  Proceeds from loans payable                                   9,047,881           1,242,783          11,139,328
                                                            -------------       -------------       -------------
Net cash provided by financing activities                       9,084,755          16,688,603          26,622,022
                                                            -------------       -------------       -------------

Minority Interest                                              (6,820,830)          6,820,830                  --
Effect of changes in exchange rates                              (312,621)           (160,627)           (473,248)

                                                            -------------       -------------       -------------
Net increase (decrease) in cash and cash equivalents             (333,599)          1,076,455             742,856

Cash and cash equivalents at beginning of period                1,076,455                  --                  --

                                                            -------------       -------------       -------------
Cash and cash equivalents at end of period                  $     742,856       $   1,076,455       $     742,856
                                                            =============       =============       =============

Supplemental cash flow information:

  Cash paid for interest                                    $          --       $          --       $          --
                                                            =============       =============       =============
  Cash paid for income taxes                                $          --       $          --       $          --
                                                            =============       =============       =============

Non cash investing and financing activities:

  Settlement of debt and payables with common shares        $   3,818,472       $          --       $   3,818,472
                                                            =============       =============       =============
  Write off of marketable securities and
  related deferred taxes and other
  comprehensive income                                      $  16,875,000       $          --       $  16,875,000
                                                            =============       =============       =============
</TABLE>

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


                                     - 35 -
<PAGE>

                          BIOACCELERATE HOLDINGS, INC.
                          (A Development Stage Company)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2004

NOTE 1 .NATURE OF THE BUSINESS

DESCRIPTION OF COMPANY: Bioaccelerate Holdings, Inc ("Bioaccelerate" or
"Company"), formerly Mobile Design Concepts, Inc. ("Mobile"), acquired
Bioaccelerate, Inc. ("BI") in an exchange of stock on September 23, 2004.
Simultaneously with the exchange of stock, Mobile Design Concepts, Inc. changed
its name to Bioaccelerate Holdings, Inc. Mobile was organized under the laws of
the State of Nevada on March 10, 2000. Mobile was formed to design, manufacture,
and lease mobile kiosks and other structures, the operation was discontinued on
December 31, 2002.

The Company is examining opportunities in both start-up and emerging companies
in the biopharmaceutical sector.

The Company has not yet generated revenues and is considered a development stage
company as defined in Statement of Financial Accounting Standards No.7.

BI was organized under the laws of the State of Delaware on December 29, 1995,
as Tallman Supply Corp. On January 14, 1999 the Company changed its name to
Westminster Auto Retailers, Inc. On July 25, 2003, the Company changed its name
to Bioaccelerate, Inc.

BI has not generated revenue and is considered a development stage company as
defined in Statement of Financial Accounting Standards No. 7. On August 31,
2003, the holders of Bioaccelerate common stock agreed to a 5 for 1 reverse
split of all of its outstanding shares. This reduced the amount of common stock
outstanding from 5 million to 1 million shares. BI acquired Pharma Manufacturing
Services Limited ("PMSL") on September 1, 2003 and issued 18,000,000 (post
reverse split) shares to PMSL shareholders. The effect was to transfer
operational control of BI to the former shareholders and directors of PMSL,
making PMSL the acquirer for accounting purposes. PMSL subsequently changed its
name to Bioaccelerate Limited.

As a result of the share exchange between the Company and BI, the shareholders
of BI have received 32,325,000 shares of stock, or 95.9% of the issued and
outstanding common stock, and the shareholders of the Company retained 1,375,085
shares. BI will continue in the same business that it was engaged in prior to
the share exchange, and all of the officers and directors of BI in office at the
time of the share exchange continue in those roles with the Company. Since
ownership and operational control of the Company is considered to have passed to
the stockholders and management of BI, BI is treated as the entity that acquired
the assets of the Company for accounting purposes.

The Company was formed to capitalize on opportunities in the biopharmaceutical
market through the development of compounds and also companies that will
commercialize those compounds. The Company acquires and develops pharmaceutical
assets, both corporate and physical.

The Company changed its year end from May 31, to December 31, to coincide with
the year end of BI.

NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES

Principals of Consolidation

The consolidated financial statements presented herein include the accounts of
the Company and its majority owned subsidiaries (collectively, the "Company").
All intercompany transactions and balances have been eliminated in
consolidation.

The consolidated financial statements include the accounts of the following
companies: Bioaccelerate Holdings, Inc (formerly Mobile Design Concepts, Inc.)

Amilar Pharma Inc.
Anvira Inc.
Bioaccelerate BVI, LTD
Bioaccelerate, Inc.
Bioaccelerate Limited
Biocardio Inc.
CNS Thera Inc.
Cynat Onclogy Inc.
Enhance Biotech, Inc.
Evolve Oncology, Inc.
Genar Oncology Inc.
Inncardio, Inc.
Innova Lifestyle, Inc.
Innovate Oncology, Inc.
Oncbio Inc.


                                     - 36 -
<PAGE>

The year end for Evolve Oncology is February 28, and the financial statements
included in the consolidation are as of February 28, 2005, and for the seven
months then ended. The year end for Enhance Biotech, Inc. has been changed from
January 31, to December 31, and the financial statements included in the
consolidation are as of December 31, 2004, and for the eight months then ended.

Use of Estimates

The accompanying financial statements are prepared in accordance with accounting
principles generally accepted in the United States of America which require
management to make estimates and assumptions. These estimates and assumptions
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenue and expense. Actual results may differ from
these estimates.

Revenue Recognition

In general, the Company will record revenue when persuasive evidence of an
arrangement exists, services have been rendered or product delivery has
occurred, the sales price to the customer is fixed or determinable, and
collectability is reasonably assured. The following policies reflect specific
criteria for the various revenues streams of the Company:

Revenue will be recognized at the time the product is delivered. Provision for
sales returns will be estimated based on the Company's historical return
experience. Revenue will be presented net of returns. Revenue from services will
be recorded at the time the services is completed.

License fee revenue is recognized under collaborative research agreements when
services are performed or when contractual obligations are met. Nonrefundable
fees received at the initiation of collaboration agreements for which the
Company has an ongoing research and development or commercial commitments are
deferred and recognized ratably over the period of the related research,
development or commercial commitments. Milestone payments under collaboration
agreements and research agreements are recognized as revenues ratably over the
remaining period of involvement by the Company in the research, development and
commercialization of the asset beginning on the date the Company achieves the
indicated milestone and such achievement is acknowledged by the collaborative
partner, which generally coincides with the receipt of the milestone payment.
Research grants revenues are recognized as the related research is performed.

Cash and Cash Equivalents

The Company considers all highly liquid investments with an original maturity of
three months or less to be cash equivalents. At December 31, 2004, the Company
maintained a balance of $364,690 on deposit at two financial institutions.

Fair Value of Financial Instruments

Fair value estimates discussed herein are based upon certain market assumptions
and pertinent information available to management as of December 31, 2004. The
respective carrying value of certain on-balance-sheet financial instruments
approximated their fair values. These financial instruments include cash,
accounts receivable, accounts payable, accrued expenses and loans payable. Fair
values were assumed to approximate carrying values for these financial
instruments because they are short term in nature and their carrying amounts
approximate fair values or they are receivable or payable on demand.

The carrying value of the Company's long-term debt approximated its fair value
based on the current market conditions for similar debt instruments.

Property and Equipment

Property and equipment is recorded at cost. Expenditures for major improvements
and additions are added to the property and equipment accounts while
replacements, maintenance and repairs, which do not extend the life of the
assets, are expensed.

Depreciation and amortization are computed by using the straight-line method
over the estimated useful lives of the assets of 3 to 7 years.

Property and equipment consists of the following:

      Office furniture and computer equipment      $  605,676
      Leasehold improvements                          512,348
                                                   ----------
                                                    1,118,024
      Less: accumulated depreciation                   25,723
                                                   ----------
                                                   $1,092,301
                                                   ==========


                                     - 37 -
<PAGE>

Depreciation charged to operations aggregated $24,058 and $1,665 during the
seven months ended December 31, 2004, and the year ended May 31, 2004.

Long Lived Assets

The carrying value of long-lived assets is reviewed on a regular basis for the
existence of facts and circumstances that suggest impairment. Should there be an
impairment, the Company measures the amount of the impairment based on the
amount that the carrying value of the impaired asset exceeds the discounted cash
flows expected to result from the use and eventual disposal of the from the
impaired assets. During the period ended December 31 2004, the company recorded
impairments related to its investments in Australian Cancer Technologies Ltd.,
Evolve Oncology Inc. and JPS Holdings in the amount of $17,383,570 (see Note
13).

Income Taxes

The Company follows SFAS 109 "Accounting for Income Taxes" for recording the
provision for income taxes. Deferred tax assets and liabilities are computed
based upon the difference between the financial statement and income tax basis
of assets and liabilities using the enacted marginal tax rate applicable when
the related asset or liability is expected to be realized or settled. Deferred
income tax expenses or benefits are based on the changes in the asset or
liability each period. If available evidence suggests that it is more likely
than not that some portion or all of the deferred tax assets will not be
realized, a valuation allowance is required to reduce the deferred tax assets to
the amount that is more likely than not to be realized. Future changes in such
valuation allowance are included in the provision for deferred income taxes in
the period of change.

Loss per Share

The Company calculates net income (loss) per share as required by Statement of
Financial Accounting Standards (SFAS) 128, "Earnings per Share." Basic earnings
(loss) per share is calculated by dividing net income (loss) by the weighted
average number of common shares outstanding for the period. Diluted earnings
(loss) per share is calculated by dividing net income (loss) by the weighted
average number of common shares and dilutive common stock equivalents
outstanding. During periods in which the Company incurs losses common stock
equivalents, if any, are not considered, as their effect would be anti dilutive.

Stock-Based Compensation

The Company accounts for equity instruments issued to employees for services
based on the fair value of the equity instruments issued and accounts for equity
instruments issued to other than employees based on the fair value of the
consideration received or the fair value of the equity instruments, whichever is
more reliably measurable.

The Company accounts for stock based compensation in accordance with SFAS 123,
"Accounting for Stock-Based Compensation." The provisions of SFAS 123 allow
companies to either expense the estimated fair value of stock options or to
continue to follow the intrinsic value method set forth in APB Opinion 25,
"Accounting for Stock Issued to Employees" (APB 25) but disclose the pro forma
effects on net income (loss) had the fair value of the options been expensed.
The Company has elected to continue to apply APB 25 in accounting for its stock
option plans.

Marketable Securities

The Company will classify its holdings of free trading shares as marketable
securities available for sale in accordance with the Statement of Financial
Accounting Standard ("SFAS") No.115, "Accounting for Certain Investment in Debt
and Equity Securities". The marketable securities will be reported at fair value
with unrealized gains and losses recorded as a separate component of accumulated
other comprehensive income and loss in stockholder's (deficit) net of taxes. The
specific identification method will be used to determine gains and losses when
securities are sold. A decline in the market value below cost that is deemed to
be other than temporary would result in a change to earnings in the period the
decline occurs. Security holdings of quoted shares which are restricted are
carried at the lower of cost and market value on the Company's balance sheet.

Equity Method

Investments in entities in which the Company has a 20% to 50% interest are
carried at cost, adjusted for the Company's proportionate share of the
undistributed income (loss).

Research and Development

Research and development are charged to expense as incurred.


                                     - 38 -
<PAGE>

Patents

Costs directly related to filing patent applications are capitalized and
amortized using the straight-line method over the estimated useful life of the
patent from the date of grant. The Company assesses the recoverability of this
intangible asset at least annually based on the expected future economic benefit
to be derived from the underlying patent over its remaining useful life. Patents
have a cost basis of $576,943 and will be amortized commencing on January 1,
2005.

Foreign Currency Translation

Bioaccelerate Limited uses the British Pound as a primary functional currency .
Assets and liabilities are translated using the exchange rates in effect at the
balance sheet date. Expenses are translated at the average exchange rates
prevailing during the year. Translation gains or losses not reflected in
earnings are reported in accumulated other comprehensive losses in the
stockholder's (deficit).

Minority Interests

Minority interests represent the interest of third parties in the net assets of
certain subsidiary companies.

Recent Accounting Pronouncements

In December 2003, the Financial Accounting Standards Board issued FASB
Interpretation Number 46-R "Consolidation of Variable Interest Entities." FIN
46-R, which modifies certain provisions and effective dates of FIN 46, sets for
the criteria to be used in determining whether an investment is a variable
interest entity should be consolidated. These provisions are based on the
general premise that if a company controls another entity through interests
other than voting interests, that company should consolidate the controlled
entity. The Company currently consolidates two entities under the provisions of
FIN 46-R (see Notes 7 and 17).

In November 2004, the FASB issued SFAS 151, "Inventory Costs." SFAS 151 amends
the accounting for abnormal amounts of idle facility expense, freight, handling
costs, and wasted material (spoilage) under the guidance in ARB 43, Chapter 4,
"Inventory Pricing." Paragraph 5 of ARB 43, Chapter 4, previously stated that
"...under some circumstances, items such as idle facility expense, excessive
spoilage, double freight, and rehandling costs may be so abnormal as to require
treatment as current period charges...." This Statement requires that those
items be recognized as current-period charges regardless of whether they meet
the criterion of "so abnormal." In addition, this Statement requires that
allocation of fixed production overheads to the costs of conversion be based on
the normal capacity of the production facilities. This statement is effective
for inventory costs incurred during fiscal years beginning after June 15, 2005.
Management does not expect adoption of SFAS 151 to have a material impact on the
Company's financial statements.

In December 2004, the FASB issued SFAS 153, "Exchanges of Nonmonetary Assets,"
an amendment to Opinion No. 29, "Accounting for Nonmonetary Transactions."
Statement 153 eliminates certain differences in the guidance in Opinion No. 29
as compared to the guidance contained in standards issued by the International
Accounting Standards Board. The amendment to Opinion No. 29 eliminates the fair
value exception for nonmonetary exchanges of similar productive assets and
replaces it with a general exception for exchanges of nonmonetary assets that do
not have commercial substance. Such an exchange has commercial substance if the
future cash flows of the entity are expected to change significantly as a result
of the exchange. SFAS 153 is effective for nonmonetary asset exchanges occurring
in periods beginning after June 15, 2005. Earlier application is permitted for
nonmonetary asset exchanges occurring in periods beginning after December 16,
2004. Management does not expect adoption of SFAS 153 to have a material impact
on the Company's financial statements.

In December 2004, the FASB issued SFAS 123(R), "Share-Based Payment." SFAS
123(R) amends SFAS 123, "Accounting for Stock-Based Compensation," and APB
Opinion 25, "Accounting for Stock Issued to Employees." SFAS 123(R) requires
that the cost of share-based payment transactions (including those with
employees and non-employees) be recognized in the financial statements. SFAS
123(R) applies to all share-based payment transactions in which an entity
acquires goods or services by issuing (or offering to issue) its shares, share
options, or other equity instruments (except for those held by an ESOP) or by
incurring liabilities (1) in amounts based (even in part) on the price of the
entity's shares or other equity instruments, or (2) that require (or may
require) settlement by the issuance of an entity's shares or other equity
instruments. This statement is effective (1) for public companies qualifying as
SEC small business issuers, as of the first fiscal year beginning after December
15, 2005, or (2) for all other public companies, as of the first fiscal year or
interim period beginning after June 15, 2005, or (3) for all nonpublic entities,
as of the first fiscal year beginning after December 15, 2005. Management is
currently assessing the effect of SFAS No. 123(R) on the Company's financial
statements.

NOTE 3 - BASIS OF PRESENTATION

The Company's financial statements are presented on a going concern basis, which
contemplates the realization of assets and satisfaction of liabilities in the
normal course of business.

The Company has experienced a significant loss from operations aggregating
$157,147,264, $2,100,238, and $160,096,166, for the seven months ended December
31, 2004, the year ended May 31, 2004, and the period from inception to December
31, 2004. In addition, the Company has working capital and stockholder deficits
at December 31, 2004, of $9,464,214 and $11,702,694 and has no revenue
generating operations.


                                     - 39 -
<PAGE>

The Company's ability to continue as a going concern is contingent upon its
ability to secure additional financing, utilize its credit facilities, increase
ownership equity and attain profitable operations. In addition, the Company's
ability to continue as a going concern must be considered in light of the
problems, expenses and complications frequently encountered in established
markets and the competitive environment in which the Company operates.

The Company is pursuing financing for its operations and seeking additional
investments. In addition, the Company is seeking to establish a revenue base.
Failure to secure such financing or to raise additional equity capital and to
establish a revenue base may result in the Company depleting its available funds
and not being able pay its obligations.

The financial statements do not include any adjustments to reflect the possible
future effects on the recoverability and classification of assets or the amounts
and classification of liabilities that may result from the possible inability of
the Company to continue as a going concern.

NOTE 4 - REVERSE ACQUISITION WITH MOBILE DESIGN CONCEPTS, INC.

On September 23, 2004, Mobile Design Concepts, Inc. issued 32,325,000 shares of
common stock to acquire all of the outstanding shares of Bioaccelerate, Inc.
This transaction was completed after a 3.5 to 1 reverse stock split of the
outstanding common stock, reducing its pre-acquisition outstanding common shares
from 4,812,800 to 1,375,086. Bioaccelerate, Inc. is a development stage company
that acquires and develops pharmaceutical compounds and products. Bioaccelerate,
Inc. funds the development of early-stage compounds and Phase II/III clinical
development. On the acquisition date, Bioaccelerate, Inc. had a majority equity
interests in biotech companies that are developing new drugs in five therapeutic
areas: cancer, cardiovascular disease, lifestyle, central nervous system
disorders, and anti- infective. Mobile Design Concepts, Inc changed its
corporate name to Bioaccelerate Holdings, Inc. The acquisition was accounted for
as though it were a recapitalization of Mobile Design Concepts, Inc. and
issuance by Bioaccelerate, Inc. of 1,375,086 shares of common stock for the net
assets of Mobile Design Concepts, Inc. of $24,819.

NOTE 5 - INVESTMENTS

During September 2004 the Company invested $2,000,000 in Advance Nanotech, Inc.
("Advance") in exchange for 2,000,000 common shares. The Company borrowed the
funds for this transaction pursuant to the credit facility from Technology
Finance, Inc. described in Note 6. The shares received are considered restricted
securities and represent approximately 6% of the outstanding shares of Advance
subsequent to a private placement by Advance at $2.00 per share in February and
March 2005. The shares are carried at the lower of cost or market of $2,000,000.
The market value of the Advance shares as quoted on the OTCBB was $14.00 and
$3.55 at December 31, 2004, and June 2, 2005.

Through December 2004 the Company acquired an aggregate of 3,928,804 common
shares of Neuro Bioscience, Inc. ("Neuro"). The shares which were obtained as an
inducement to provide future financing and have no cost basis. These shares are
carried at the lower of cost or market of $0. The market value of the Neuro
Bioscience shares as quoted on the Pink Sheets was $2.00 and $1.25 at December
31, 2004, and June 2, 2005.

During November 2004 the Company invested $1,366,536 in Australian Cancer
Technology ("ACT") in exchange for 4,893,301 common shares. The Company borrowed
the funds for this transaction pursuant to the credit facility from Technology
Finance, Inc. described in Note 6. The shares received are considered restricted
securities and represent approximately 4% of the outstanding shares of ACT. The
shares are carried at the lower of cost or market of $191,083. The market value
of the ACT shares as quoted on the ASX was $.23 and $.10 at December 31, 2004,
and June 2, 2005.

During August 2004 the Company invested $222,936 in JPS Holdings ("JPS"), a
private Company. No trading information or financial information is available
for JPS and the Company carries its investment at the lower of cost or market of
$0.

The Company holds an investment carried at cost of $11,788.

NOTE 6 - LOANS AND NOTES PAYABLE

Credit Facilities

During February 2004 the Company entered into a senior secured credit facility
with Technology Finance, Inc. ("Technology") under which Technology shall
provide the Company one or more loans in the aggregate principal amount of up to
$7,500,000. Notwithstanding this Technology shall have no obligation to fund the
Company, if one of the following have occurred: (i) there shall be a material
change in the business, properties, assets, results of operations, prospects or
financial condition of the Company since January 1, 2004; (ii) the Company shall
be in breach of, or in default under any material contract, license agreement or
instrument; or iii) there shall have occurred a disruption in the securities
markets. Technology has the right to convert the outstanding balance into shares
of the Company's common stock at $1.00 per share. The credit facility matures on
the earliest of (i) the date on which a placement in which the Company receives
at least $25,000,000 in gross proceeds for the issuance of debt or equity
securities, (ii) the date on which an event of default occurs, or (iii) the date
on which a change in control occurs. The advances bear interest at a rate equal
to the Applicable Federal Rate, as defined in Section 1247(d) of the Internal
Revenue Code and are secured by all of the Company's assets and assets acquired


                                     - 40 -
<PAGE>

in the future. The credit facility contain certain affirmative and negative
covenants including the Company furnishing Technology with audited financial
statements within 90 days after its year end and unaudited financial statements
with 45 days of each quarter excluding the Company's year end. In addition, the
credit facility provides that at the date of signing there shall be no
outstanding options, warrants or subscription rights for capital stock of the
Company. As of the date hereof the Company is in default of the covenant to
provide financial statements for the year ended December 31, 2004, and the
quarter ended March 31, 2005. In addition, there has been a material change in
the financial condition of the Company since it last filed quarterly financial
statements with the Securities and Exchange Commission. The Company has not been
notified by Technology as to whether the credit facility will be called because
of the defaults and the entire balance due has been classified as a current
liability. The Company had a balance of $4,047,574 drawn against the balance of
this credit facility at December 31, 2004 and as of December 31, 2004 the
interest rate was 4%. The loan matures upon one of the events described above.
During December 2004 the Company issued 2,893,090 shares of common stock in
exchange for the cancellation of $2,893,090 of debt pursuant to this credit
facility. The difference between the fair value of the shares of $36,886,898 and
the amount of the debt settled, of $33,993,808, has been recorded as non cash
interest expense (see Note 9). At June 2, 2005, the Company was indebted for
$5,805,592 pursuant to this credit facility.

During September 2004 the Company entered into a senior secured credit facility
with Lifescience Ventures, Limited ("Lifescience") under which Lifescience shall
provide the Company one or more loans in the aggregate principal amount of up to
$12,500,000. Notwithstanding this Lifescience shall have no obligation to fund
the Company, if one of the following have occurred: (i) there shall be a
material change in the business, properties, assets, results of operations,
prospects or financial condition of the Company since January 1, 2004; (ii) the
Company shall be in breach of, or in default under any material contract,
license agreement or instrument; or iii) there shall have occurred a disruption
in the securities markets. As an inducement for extending the credit facility
Lifescience received 1,000,000 warrants to purchase shares of the Company's
common stock at $14 per share and 1,000,000 warrants to purchase shares of the
Company's common stock for $28 per share and the credit facility contains a
clause prohibiting the repricing of any outstanding options or warrants to a
price which is less than the prices of the Lifescience warrants. The fair value
of the warrants, determined using the Black-Scholes option pricing model,
aggregates $12,800,000 and will be amortized as additional interest over the
term of the credit facility commencing with the first draw. The credit facility
matures on the earliest of (i) the date on which a placement in which the
Company receives at least $50,000,000 in gross proceeds for the issuance of debt
or equity securities, (ii) the date on which an event of default occurs, or
(iii) the date on which a change in control occurs. The advances bear interest
at a rate equal to the Applicable Federal Rate, as defined in Section 1247(d) of
the Internal Revenue Code and are secured by all of the Company's assets and
assets acquired in the future. The credit facility contain certain affirmative
and negative covenants including the Company furnishing Lifescience audited
financial statements within 90 days after its year end and unaudited financial
statements with 45 days of each quarter excluding the Company's year end. In
addition, the credit facility provides that at the date of signing there shall
be no outstanding, options, warrants or subscription rights for capital stock of
the Company. As of the date hereof the Company is in default of the covenant to
provide financial statements for the year ended December 31, 2004, and the
quarter ended March 31, 2005. In addition, there has been a material change in
the financial condition of the Company since it last filed quarterly financial
statements with the Securities and Exchange Commission. During December 2004 the
Company issued 250,000 shares of common stock in exchange for the cancellation
of $250,000 of debt pursuant to this credit facility. The difference between the
fair value of the shares of $3,187,500 and the amount of the debt settled, of
$2,937,500, has been recorded as non cash interest expense (see Note 9). No
amounts are outstanding pursuant to this credit facility at December 31, 2004.

During September 2004 the Company entered into a senior secured credit facility
with Jano Holdings Limited ("Jano") under which Jano shall provide the Company
one or more loans in the aggregate principal amount of up to $12,500,000.
Notwithstanding this Jano shall have no obligation to fund the Company, if one
of the following have occurred: (i) there shall be a material change in the
business, properties, assets, results of operations, prospects or financial
condition of the Company since January 1, 2004; (ii) the Company shall be in
breach of or in default under any material contract, license agreement or
instrument; or iii) there shall have occurred a disruption in the securities
markets. As an inducement for extending the credit facility Jano received
1,000,000 warrants to purchase shares of the Company's common stock at $14 per
share and 1,000,000 warrants to purchase shares of the Company's common stock
for $28 and the credit facility contains a clause prohibiting the repricing of
any outstanding options or warrants to a price which is less than the prices of
the Jano warrants. The fair value of the warrants, determined using the
Black-Scholes option pricing model aggregates $12,800,000 and will be amortized
as additional interest over the term of the credit facility commencing with the
first draw. The credit facility matures on the earliest of (i) the date on which
a placement in which the Company receives at least $50,000,000 in gross proceeds
for the issuance of debt or equity securities, (ii) the date on which an event
of default occurs, or (iii) the date on which a change in control occurs. The
advances bear interest at a rate equal to the Applicable Federal Rate, as
defined in Section 1247(d) of the Internal Revenue Code and are secured by all
of the Company's assets and assets acquired in the future. The credit facility
contain certain affirmative and negative covenants including the Company
furnishing Jano audited financial statements within 90 days after its year end
and unaudited financial statements with 45 days of each quarter excluding the
Company's year end. In addition, the credit facility provides that at the date
of signing there shall be no outstanding options, warrants or subscription
rights for capital stock of the Company. As of the date hereof the Company is in
default of the covenant to provide financial statements for the year ended
December 31, 2004, and the quarter ended March 31, 2005. In addition, there has
been a material change in the financial condition of the Company since it last
filed quarterly financial statements with the Securities and Exchange
Commission. No amounts have been borrowed pursuant to this credit facility.


                                     - 41 -
<PAGE>

Convertible Loans

During December 2004 the Company borrowed an aggregate of $3,100,000 with
interest at Libor (2.35% at December 31, 2004). The loan is convertible into
common shares of the Company at equivalent terms to the Company's next equity
financing, of not less than $6,000,000. Should a financing not occur within 1
year, the loan shall accrue interest at Libor plus 10% and the loan will be
convertible into common shares at a price to be determined between the parties.
There is no specified repayment date on the loan.

In 1999 and 2000, the Company formed two joint ventures with Elan Corporation
("Elan") that were terminated in 2002 and 2003. As part of the joint ventures
Elan loaned the Company $1,925,028 in convertible debt financing, maturing on
April 14, 2006. Interest accrues at 9% per annum, compounded on an annual basis.
Elan has the right to convert outstanding debt into the number of common shares
that is obtained by dividing outstanding principal and interest by $10.29. At
December 31, 2004, accrued interest totaled $457,908.

Notes payable

The Company's borrowings under an equipment lease financing agreement are
collateralized by the related equipment and furniture and fixtures, at interest
rates between 12% and 13% with monthly payments of approximately $9,920. Future
aggregate annual maturities are:

      2005      $  119,042
      2006          55,560
                ----------
                $  167,747
                ==========

NOTE 7 -  INVESTMENTS IN AFFILIATES

Evolve Oncology

Through December 2004, the Company acquired 23,857,000 common shares of Evolve
Oncology Inc. ("Evolve") these shares were obtained initially through the
acquisition of Pharma Manufacturing Services Ltd. and the sale of Antibody
Technologies Inc.

At December 31, 2004, the Company owned a 49.15% interest in Evolve. For
accounting purposes, the Company is treating its capital investment in Evolve as
a vehicle for research and development. Because the Company is solely providing
financial support to further the research and development of Evolve, such
amounts are being charged to expense as incurred by Evolve since Evolve
presently has no ability to fund these activities and is dependent on the
Company to fund its operations. In these circumstances, Evolve is considered a
variable interest entity and has been consolidated. The creditors of Evolve do
not have recourse to the general credit of the Company. Through December 31,
2004, the Company advanced Evolve an aggregate of $1,296,632.

A summary of financial position and results of operations of Evolve as of
December 31, 2004, and the seven months then ended is as follows:

      Current assets                       $       --
      Property and equipment                     98,000
                                           ------------
                                           $     98,000
                                           ============

      Current liabilities                  $  2,455,139
      Stockholders' (deficit)                (2,357,139)
                                           ------------
                                           $     98,000
                                           ============

      Sales                                $       --
                                           ============
      Net (loss)                           $(40,360,050)
                                           ============
      Minority interest in net (loss)      $  6,820,830
                                           ============

Enhance Biotech

At December 31, 2004, the Company owned a 22.4% interest in Enhance Biotech,
Inc. ("Enhance"). For accounting purposes, the Company is treating its capital
investment in Enhance as a vehicle for research and development. Because the
Company is solely providing financial support to further the research and
development of Enhance, such amounts are being charged to expense as incurred by
Enhance since Enhance presently has no ability to fund these activities and is
dependent on the Company to fund its operations. In these circumstances, Enhance
is considered a variable interest entity and has been consolidated. The
creditors of Enhance do not have recourse to the general credit of the Company.
Through December 31, 2004, the Company advanced Enhance an aggregate of
$1,442,000.


                                     - 42 -
<PAGE>

A summary of financial position and results of operations of Enhance at December
31, 2004, is as follows:

      Current assets              $    871,283
      Property and equipment           807,533
      Other assets                     727,706
                                  ------------
                                  $  2,406,522
                                  ============

      Current liabilities         $  4,158,415
      Long-term liabilities          3,180,588
      Stockholders'(deficit)        (4,932,481)
                                  ------------
                                  $  2,406,522
                                  ============

      Sales                       $         --
                                  ============
      Net loss                    $(41,216,411)
                                  ============

NOTE 8 - ACQUISITION OF ARDENT PHARMACEUITCALS, INC.

On December 20, 2004, Enhance Biotech, Inc. ("Enhance") completed the
acquisition of Ardent Pharmaceuticals, Inc. ("Ardent") a privately held
biotechnology company that uses proprietary expertise in delta receptor
chemistry and pharmacology to discover, develop and commercialize a broad range
of novel drug candidates. The Enhance Board of Directors believe that Ardent's
resources will help maximize the potential and advance the development of
Enhance's pipeline and create greater expertise and infrastructure to pursue
product development opportunities. In consideration for the acquisition, Enhance
issued 23,149,808 shares of common stock to the stockholders of Ardent in
exchange for 100% of their outstanding shares. Enhance has reserved
approximately 5,111,299 shares in the aggregate for issuance upon exercise of
outstanding options, warrants and convertible promissory notes of Ardent
outstanding prior to the merger. In addition, approximately 234,172 shares were
issued for fees associated with the Merger. Immediately after the acquisition
the ownership interests of the former security holders of Ardent in the combined
enterprise were approximately 45% of Enhance with the exclusion of a certain
warrant to purchase 1.5 million shares of Common Stock issued to Bioaccelerate,
Inc. The transaction was completed on December 20, 2004. The Enhance Board of
Directors agreed to change the year-end of Enhance from January 31 to December
31.


                                     - 43 -
<PAGE>

For accounting purposes the merger has been made effective as of December 31,
2004. Ardent assets and liabilities at the year ended December 31, 2004, are
included in the December 31, 2004, consolidated balance sheet. The value of
Ardent's research and development projects in progress was charged to operations
upon closing of the merger in accordance with SFAS 2, Accounting for Research
and Development Costs. No goodwill was recognized as a result of the merger with
Ardent.

The purchase price was allocated to the estimated fair value of the acquired
tangible and intangible assets and assumed liabilities as follows:

<TABLE>
<CAPTION>
                                            Ardent         Value of In
                                          Balances at        Process
                                         December 31,       Research &     Allocated to
                                             2004          Development       Enhance
                                         ------------     ------------     ------------
<S>                                      <C>              <C>              <C>
        Assets
      Cash and Cash Equivalents          $    370,585                      $    370,585
      Accounts Receivable                     110,030                           110,030
      Property, Plant and Equipment           755,275                           755,275
      Patents                                 576,943                           576,943
      Other Assets                             11,405                            11,405
      In-Process Research &                                 29,600,000       29,600,000
      Development                                --
      Total Assets                       $  1,824,238                      $ 31,424,238

        Liabilities
      Accounts Payable                   $   (285,767)                     $   (285,767)
      Long term debt                         (174,602)                         (174,602)
      Deferred Revenue                     (1,250,000)                       (1,250,000)
      Convertible Note Payable             (2,382,935)                       (2,382,935)
      Other Liabilities                       (15,450)                          (15,450)
      Total Liabilities                  $ (4,108,754)                     $ (4,108,754)
      Fair value of Ardent stock                             4,678,467        4,678,467
      options
      Total Purchase Price                                                 $ 31,993,951
</TABLE>

In-Process Research and Development

As part of the acquisition of Ardent, the Company engaged an independent
third-party to appraise the value of the intangible assets acquired. Based upon
this appraisal, the Company allocated $29.6 million of the purchase price of
Ardent to acquired In-Process Research and Development (IPR&D).

Acquired IPR&D represents drug candidates currently under development that have
not yet received regulatory approval for marketing and have no alternative
future use. While the intangible assets examined included both drug candidates
under development by Ardent and the Ardent compound library as a whole, no value
was assigned to the compound library or to three of the seven drug candidates
under development. No value was assigned to these intangible assets due to the
substantial amount of R&D activities remaining, related risks of further
identifying and/or developing compounds from the library, and the inability to
measure fair value with reasonable reliability. Four compounds made up the basis
for IPR&D. Three of these products are in the "Discovery Research Phase - Two to
Four Years" as defined in Exhibit 3.1 of the ACIPA Practice Aid - Assets
Acquired in a Business Combination to be used in Research & Development
Activities related to FASB Statement 142. The third has just entered the second
phase defined therein, as "Early Development Phase - Four to Six Years".

As of the date this transaction closed, none of these developments had reached
technological feasibility nor had an alternative future use. While management
believes these compounds have value, their development is not complete and
consequently there is considerable uncertainty as to the technological
feasibility of the products. Accordingly, as per FAS 141, Par. 42, the Enhance
expensed $29,600,000 as acquired IPR&D at the acquisition date, representing the
portion of the purchase price attributed to these developments.

As of the date of acquisition, Enhance issued 3,964,857 fully vested common
stock options to Ardent employees. The fair value of these options has been
calculated using the Black-Scholes pricing model with the following assumptions:
27 to 48 months expected life, 483% stock volatility, 3.12% to 3.55% risk-free
interest rate and no dividends. The total value of $4,678,467 has been charged
to operations.

In accordance with FASB 141, the Company recognized a liability related to the
Ardent deferred revenue of $1,250,000 because such deferred revenue represents a
legal obligation assumed by Enhance.

Pro Forma Revenue and Net Loss

The following unaudited pro forma information is based on the assumption that
the acquisition occurred at the beginning of the reporting period.

      Revenue                                    $     123,000
      Net loss                                   $(160,685,054)
      Net loss per share, basic and diluted      $       (4.82)

                                     - 44 -
<PAGE>

NOTE 9 - RESEARCH AND DEVELOPMENT AGREEMENTS

During 2004 the Company entered into a Feasibility Study, Option and License
Agreement with ALZA Corporation, a division of Johnson & Johnson ("ALZA") for
the development of DPI-125 for moderate-to-severe pain. In consideration of an
initial non-refundable fee of $1,250,000, Enhance granted ALZA a 12-month option
for an exclusive, worldwide license to the compound, during which time, ALZA
would conduct feasibility studies. If ALZA exercises the option, ALZA will
proceed with development of at least two potential products, an intravenous
formulation for acute pain and at least one formulation for chronic pain. ALZA
may also elect to develop other formulations of DPI-125. The agreement also
provides ALZA with exclusive options to license additional analgesic compounds
from the Enhance portfolio. Development and commercialization expenses for the
products will be borne by ALZA. In addition to the option fee upon signing the
agreement, Enhance will receive further payments should ALZA exercise its option
following feasibility studies, and will also be eligible for development
milestone payments and royalties. Enhance also has the right to co-promote the
intravenous product in the US.

The Company completed delivery to ALZA of certain quantities of compounds
required by the agreement during December 2004. Beginning in January 2005, the
Company will amortize the initial $1,250,000 fee to revenue on a straight-line
basis over the 25 year time period that the Company expects to be involved with
ALZA in developing and commercializing the technology. Any subsequent payments
or development milestones payments will be amortized to revenue on a similar
basis.

NOTE 10 - STOCKHOLDERS' (DEFICIT)

During the periods covered by these financial statements the Company issued
shares of common stock without registration under the Securities Act of 1933.
Although the Company believes that the sales did not involve a public offering
of its securities and that the Company did comply with the "safe harbor"
exemptions from registration, provided required information and acquired
necessary subscription agreements, it could be liable for rescission of the
sales or other actions, including SEC enforcement actions, if such exemptions
were found not to apply or other violations occurred. This could have a material
negative impact on the Company's financial position and results of operations.

On December 20, 2004, one of the Company's consolidated subsidiaries issued
shares of its common stock for purchased research and development and services.
These shares were valued at their fair market value of $32,824,059 which has
been charged to operations.

On December 2, 2004, the Company issued 2,275,804 shares of common stock for
services. The shares issued were valued at their fair market value of
$29,016,502 or $12.75 per share.

On December 2, 2004, the Company issued 3,818,472 shares of common stock for the
satisfaction of debt and payables of $3,818,472. The shares issued were valued
at their fair market value of $48,685,517 or $12.75 per share. The difference of
$44,867,045 between the fair value of the shares and the recorded amount of the
debt has been charged to operations as non cash stock compensation or non cash
interest.

On December 3, 2004, and August 16, 2004, one of the Company's consolidated
subsidiaries issued shares of its common stock for purchased research and
development and services. These shares were valued at their fair market value of
$22,870,000 which has been charged to operations.

On September 23, 2004, the Company issued 1,375,086 shares of Common Stock for
the net assets of Mobile Design Concepts of $24,819 in conjunction with a
recapitalization.

In May 2004 the Company issued 218,286 shares of Common Stock for cash net of
funding costs at a value of $0.77 per share or $168,000.

In February 2004 the Company issued 6,622,605 shares of Common Stock for cash
net of funding costs at a value of $0.73 per share or $4,816,781.

In February 2004 one of the Company's consolidated subsidiaries issued shares of
its common stock for an acquisition. These shares were valued at their fair
market value of $8,879,507.

On September 1, 2003, the Company issued 811,612 shares of Common Stock for the
satisfaction of debt of $1,562,535 or $1.93 per share.

On September 1, 2003, the Company issued 23,373,947 shares of Common Stock for
the acquisition of Pharma Manufacturing Services Ltd at a value of $0.0008 per
share.

On November 1, 2002, the Company issued 1,298,550 shares of Common Stock for
cash of $1,000 or $0.001 per share.


                                     - 45 -
<PAGE>

NOTE 11 - COMMITMENTS AND CONTINGENCIES

Operating Leases

The Company has offices in New York and London, England.

Bioaccelerate, Inc. entered into a lease on September 1, 2004, for a one year
period to occupy office space in New York at a gross cost of $27,000 per month.

Bioaccelerate Limited occupies 5,000 square feet of office space in London. The
premises are held on a three-year lease from July 28, 2004.

The Company leases its office facilities under operating leases for gross
monthly rent, including common area maintenance, of approximately $12,000. The
office lease provides for no annual cost of living adjustments in the base rent
and the warehouse leases provide for fixed annual increases in the base rent.

Future minimum lease payments under all non-cancelable operating leases for
years ending subsequent to December 31, 2004, are as follows:

      2005      $360,000
      2006      $144,000
      2007      $ 84,000

Rent expense for the seven months ended December 31, 2004 and the year ended May
31, 2004, was $217,139 and $161,000.

Leases- Enhance

The company leases office and lab space under non-cancelable operating leases.
Future minimum annual lease payments are:

            2005              $  344,147
            2006                 348,943
            2007                 310,536
            2008                 319,852
            2009                 319,852
            Thereafter             9,596
                              ----------
                              $1,652,926
                              ==========

Research and Development

On July 1, 2003 the Company entered into an agreement with Queen Mary and
Westfield College to provide research and development services for the Company's
infertility program. The agreement is for three years and is payable in
quarterly installments of $54,000.

Glaxo SmithKline Royalty

The Company possesses the exclusive worldwide rights to certain technology
acquired from GlaxoSmithKline, and as a result may be obligated for future
royalty payments of up to 2% of net sales on the technology acquired for the
duration of the related patents.

Organon License

During 1999, the Company granted a license to N.V. Organon AG ("Organon") to use
the Company's patent rights in the development, manufacture, use and sale of one
of its analgesic compounds (the "License"). Organon made nonrefundable cash
payments to the Company of $4 million during 1999 and 2000. During March 2003,
Organon notified the Company of its intention to discontinue development of
DPI-3290 under the License. Subsequent to this notification, Enhance delivered
to Organon a notification of termination of the agreement for cause. By letter
to the Company, dated January 11, 2005, Organon asserted its belief that it
maintains certain rights under the License. The Company believes this claim is
without merit and has initiated dispute resolution procedures specified in the
License to confirm that the License has been terminated and that Organon has no
further rights thereunder.

Credit Facilities

On July 6, 2004, Bioaccelerate Inc. provided a credit facility to Evolve
Oncology, Inc. of $5,000,000 repayable on the closing of a debt or equity
financing in which the Evolve receives at least $10,000,000 in gross proceeds.
The facility accrues interest on the outstanding balance at the Applicable
Federal Base Rate. The company received 5,000,000 warrants convertible into
common stock at an exercise price of $2.60 on the commencement of the facility
agreement.


                                     - 46 -
<PAGE>

On August 9th, 2004, Bioaccelerate Inc. provided a credit facility to Neuro
Bioscience, Inc. of $1,225,000 repayable on the closing of a debt or equity
financing in which the Neuro Bioscience receives at least $10,000,000 in gross
proceeds. The facility accrues interest on the outstanding balance at the
Applicable Federal Base Rate. The company received 2,400,000 shares of common
stock on the commencement of the facility agreement.

On August 11, 2004, Bioaccelerate Inc. provided a credit facility to Enhance
Biotech, Inc. of $6,000,000 repayable on the closing of a debt or equity
financing in which the Enhance receives at least $10,000,000 in gross proceeds.
The facility attracts interest on the outstanding capital at the Applicable
Federal Base Rate. The company received 1,500,000 warrants convertible into
common stock at an exercise price of $3.00 on the commencement of the facility
agreement.

NOTE 12 - INCOME TAXES

The Company accounts for income taxes under SFAS 109, which requires use of the
liability method. SFAS 109 provides that deferred tax assets and liabilities are
recorded based on the differences between the tax bases of assets and
liabilities and their carrying amounts for financial reporting purposes,
referred to as temporary differences. Deferred tax assets and liabilities at the
end of each period are determined using the currently enacted tax rates applied
to taxable income in the periods in which the deferred tax assets and
liabilities are expected to be settled or realized.

The provision for income taxes differs from the amount computed by applying the
statutory federal income tax rate to income before provision for income taxes
for the seven months ended and the year ended December 31, 2004, and May 31,
2004. The sources and tax effects of the differences are as follows:

      Income tax provision at the federal statutory rate       34%
      Effect of operating losses                              (34)%
                                                            -----
                                                               --%
                                                            =====

As of December 31, 2004, the Company has a net operating loss carry forward of
approximately $6,000,000. This loss will be available to offset future taxable
income. If not used, this carry forward will expire through 2024. The deferred
tax asset of approximately $2,000,000 relating to the operating loss carry
forward has been fully reserved at December 31, 2004. The principal difference
between the net operating loss for income tax purposes and for reporting
purposes results from non cash stock compensation and impairment charges being
deducted for reporting purposes.

NOTE 13 - IMPAIRMENTS

During December 2004 the Company determined that the intangible assets of Evolve
aggregating $15,985,181 were impaired due to the uncertainty related to the
ability of the Company to utilize these assets. The Company recorded an
impairment charge to operations of $15,985,181 related to these intangibles.

During August 2004 the Company invested $222,936 in JPS Holdings ("JPS"), a
private company. No trading information or financial information is available
for JPS and the Company has recorded an impairment charge of $222,936 related to
this investment.

During November 2004 the Company invested an aggregate of $1,366,536 in
Australian Cancer Technology Ltd. ("ACT") a company traded on the Australian
Stock Exchange. The fair market value of the shares as of December 31, 2004, was
$191,083 and the Company recorded an impairment charge of $1,175,453 related to
this investment.

NOTE 14 - MATERIAL YEAR END ADJUSTMENTS

During the quarter ended December 31, 2004, the Company determined that certain
investments with a carrying value of $20,875,407 with a related deferred tax
liability of $8,500,000 and unrealized gains on marketable securities included
in other comprehensive income of $12,375,407 had been incorrectly carried on the
Company's balance sheet. At December 31, 2004, the Company recorded a reversal
of these accounts which had no effect on the results of operations for the seven
months ended December 31, 2004.

NOTE 15 - RELATED PARTY TRANSACTIONS

At December 31, 2004, the Company had an aggregate of $876,321 due to
affiliates. These advances have no specified due date or interest rate.

In addition, Enhance had an aggregate of $475,595 in amounts due to affiliates
for unpaid salary and consulting fees.

NOTE 16 -  SUBSEQUENT EVENTS

Through March 2005 the Company issued an aggregate of 2,880,146 shares of common
stock valued at their fair market value of $18,167,581 for consulting services
and purchased research and development. The value of these shares which will be
charged to operations.


                                     - 47 -
<PAGE>

On June 1, 2005 the Company issued 250,000 shares of Common Stock valued at
their fair market value of $1,225,000 for consulting services. The value of
these shares which will be charged to operations.

During February 2005 Inncardio, Inc. entered into an Acquisition Agreement
wherein it agreed to be acquired by Softwall Equipment Corporation whereby
Softwall Equipment Corporation acquired all of the outstanding common stock of
Inncardio, Inc. in exchange for 16,500,000 common shares of Softwall. After the
issuance of the 16,500,000 shares in the Acquisition, the Company had
approximately 18,000,000 shares of its common stock issued and outstanding and
changed its name to Inncardio, Inc.

On March 24, 2005, Inncardio Inc. entered into an Agreement and Plan of Merger
(the "Agreement and Plan of Merger") among Inncardio Inc., Cengent Acquisition
Corp. ("CAC"), a wholly-owned subsidiary of Inncardio Inc., and Cengent
Therapeutics Inc. ("Cengent"), a privately held company. Pursuant to the Merger
Agreement, CAC will merge with and into Cengent, and as a consequence of the
merger (the "Merger") Cengent will become a wholly owned subsidiary of the
Registrant. The Merger is expected to be consummated in the Fall of 2005.

On April 6, 2005, the Company filed a Definitive Information Statement
disclosing that the Directors and majority of common stock holders had approved
an amendment to the Company's Certificate of Incorporation to increase the
number of authorized shares of common stock of the Company par value $0.001 from
50 million to 100 million shares and the increase the number of authorized
shares of preferred stock par value $0.001 of the Company from 1 million shares
to 10 million shares.

Through May 2005 the Company borrowed an additional $1,758,018 pursuant to its
credit facility with Technology Finance.

Note 17. CORRECTION OF AN ERROR

During July 2005 the Company determined that Enhance which had originally been
accounted for using the equity method should have been consolidated pursuant to
FIN 46R. As a result of the consolidation the Company's the Company's current
assets increased by $871,283, total assets increased by $2,406,522, current
liabilities increased by $2,716,415, total liabilities increased by $5,897,003,
and stockholders' (deficit) increased by $(3,490,481). In addition, the
consolidation increased the net (loss) by $(41,216,411) to $(157,147,264) or
$(1.09) per share to $(4.72) per share.


                                     - 48 -
<PAGE>

ITEM 8 - CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURES

In a form 10QSB/A filed on 24th November, 2004 the company reported a change of
auditor. The Company and Pritchett, Siler, & Hardy, P.C. terminated their
relationship, and the Company retained F E Hanson Limited.

On May, 4th, 2005 the company filed a Form 8/K reporting that the company had
terminated F E Hanson Limited as the company's auditor and appointed Stark,
Winter, Schenkein, & Co LLP as the company auditor. Registrant provided F E
Hanson Limited, the former accountant, with a copy of the disclosures it is
making herein prior to the filing of this Current Report on Form 8-K with the
Securities and Exchange Commission ("SEC") and requested that F E Hanson Limited
furnish the Registrant a letter addressed to the SEC stating if F E Hanson
Limited does not agree with the representations made within this report 8-K. The
decision to change auditors was approved by the Board of Directors. The former
accountant only acted for the Registrant from November 2004. The prior
accountant did not render any report on the financial statements for the past
two years which contained any adverse opinion or disclaimer of opinion, or was
qualified or modified as to uncertainty, audit scope or accounting principles.
During the Registrant's two most recent fiscal years and any subsequent interim
period preceding the termination there were no disagreements with the former
accountant on any matter of accounting principles or practices, financial
statement disclosure, or auditing scope or procedure.

Simultaneously with the termination of its relationship with F E Hanson
Limited., Registrant retained Stark, Winter, Schenkein, & Co., LLP, as
registrant's independent auditors. Stark, Winter, Schenkein, & Co LLP's address
is 7535 East Hampden Avenue, Suite 109, Denver, CO, 80231

The Registrant's Board of Directors approved the appointment of Stark, Winter,
Schenkein, & Co LLP as the Registrant's independent accountants on April 29,
2005.

During the most recent fiscal year and subsequent interim period, Registrant has
not consulted with Stark, Winter, Schenkein, & Co LLP regarding (i) either the
application of accounting principles to a specified transaction, either
completed or proposed, or the type of audit opinion that might be rendered on
its financial statements, or (ii) any matter that was either the subject of
disagreement on any matter of accounting principles or practices, financial
statement disclosure or auditing scope or procedures or a reportable event (as
defined in Item 304(a)(1)(v) of Regulation S-K).

ITEM 8A - CONTROLS AND PROCEDURES

As of June 2, 2005, an evaluation was performed by our Chief Executive Officer
and Chief Financial Officer, of the effectiveness of the design and operation of
our disclosure controls and procedures. Based on that evaluation, our Chief
Executive Officer and Chief Financial Officer concluded that our disclosure
controls and procedures were effective as of June 2, 2005. There have been no
significant changes in our internal controls or in other factors that could
significantly affect internal controls subsequent to December 31, 2004.


                                     - 49 -
<PAGE>

                                    PART III

ITEM 9 - DIRECTORS AND EXECUTIVE OFFICERS

The following are the current Directors and Executive Officers of the Company
and their ages, as of June 2, 2005.

      Name                  Age         Position

      Lee Cole              44         CEO and Director
      Linden Boyne          61         CFO, Secretary and Director

All directors hold office until the next annual meeting of stockholders and
until successors have been duly elected and qualified. There are no agreements
with respects to the election of directors. Set forth below is certain
biographical information regarding the Company's executive officers and
directors:

LEE COLE, CEO AND DIRECTOR

Lee Cole has extensive experience in technology growth companies and the venture
capital markets. Lee has been a principal of Tech Capital Group, a technology
consulting and investment firm with stakes in private and public information and
healthcare technology companies since 1998. Lee Cole is also a Director of
Enhance Biotech Inc, Advance Nanotech Inc, NeuroBioscience Inc

                                     - 50 -
<PAGE>

LINDEN BOYNE, CFO, SECRETARY AND DIRECTOR

Linden Boyne joined NSS Newsagents plc in 1973 as a Regional Manager in charge
of 220 stores. He was subsequently appointed to the Board in 1978 and became
Retail Managing Director in 1990 with responsibility for 550 branches. He
resigned in 1991 when the company was acquired . He is Secretary and Director
of, Advance Nanotech Inc, and Electronic Game Card, Inc and Secretary of Enhance
Biotech, Inc and Innovate Oncology, Inc


                                     - 51 -
<PAGE>

ITEM 10 - EXECUTIVE COMPENSATION

Summary

Bioaccelerate has not had a bonus, profit sharing, or deferred compensation plan
for the benefit of its employees, officers or directors. Bioaccelerate has
salaries and other compensation to its officers, directors or employees for the
year ended December 31 2004 as detailed in the compensation table below.
Bioaccelerate has a Service Agreement with Sterling Corporate and Financial
Services for the provision of services by the CEO, CFO and Secretary together
with certain financial and administrative staff at the rate of $30,000 per
month.

Compensation Table

                                                    NUMBER SHARES  PERCENTAGE OF
                                                    (Beneficial        ISSUED
     NAME           DIRECTOR SINCE    COMPENSATION   and Legal)    OUTSTANDING
Lee Cole            May 1,  2003              0            0              0
Linden Boyne        Nov 19, 2003              0            0              0

BONUSES AND DEFERRED COMPENSATION

None

COMPENSATION PURSUANT TO PLANS

None

PENSION TABLE

None

OTHER COMPENSATION

None

TERMINATION OF EMPLOYMENT AND CHANGE OF CONTROL ARRANGEMENT There are no
compensatory plans or arrangements of any kind, including payments to be
received from Bioaccelerate, with respect to any person which would in any way
result in payments to any such person because of his or her resignation,
retirement, or other termination of such person's employment with Bioaccelerate
or its subsidiaries, or any change in control of Bioaccelerate, or a change in
the person's responsibilities following a change in control of Bioaccelerate. To
the knowledge of management, during the past five years, no present or former
director or executive officer of the Company:

(1) filed a petition under the federal bankruptcy laws or any state insolvency
law, nor had a receiver, fiscal agent or similar officer appointed by a court
for the business or present of such a person, or any partnership in which he was
a general partner at or within two years before the time of such filing, or any
corporation or business association of which he was an executive officer within
two years before the time of such filing;

(2) was convicted in a criminal proceeding or named subject of a pending
criminal proceeding (excluding traffic violations and other minor offenses);


                                     - 52 -
<PAGE>

(3) was the subject of any order, judgment or decree, not subsequently reversed,
suspended or vacated, of any court of competent jurisdiction, permanently or
temporarily enjoining him form or otherwise limiting, the following activities:

(i) acting as a futures commission merchant, introducing broker, commodity
trading advisor, commodity pool operator, floor broker, leverage transaction
merchant, associated person of any of the foregoing, or as an investment
advisor, underwriter, broker or dealer in securities, or as an affiliated
person, director of any investment company, or engaging in or continuing any
conduct or practice in connection with such activity;

(ii) engaging in any type of business practice; or (iii) engaging in any
activity in connection with the purchase or sale of any security or commodity or
in connection with any violation of federal or state securities laws or federal
commodity laws;

(4) was the subject of any order, judgment, or decree, not subsequently
reversed, suspended, or vacated, of any federal or state authority barring,
suspending, or otherwise limiting for more than 60 days the right of such person
to engage in any activity described above under this Item, or to be associated
with persons engaged in any such activity;

(5) was found by a court of competent jurisdiction in a civil action or by the
Securities and Exchange Commission to have violated any federal or state
securities law, and the judgment in subsequently reversed, suspended, or vacate;

(6) was found by a court of competent jurisdiction in a civil action or by the
Commodity Futures Trading Commission to have violated any federal commodities
law, and the judgment in such civil action or finding by the Commodity Futures
Trading Commission has not been subsequently reversed, suspended or vacated.

Scientific Advisory Board

The Company's Scientific Advisory Board includes recognized scientists and
experts in the fields of male sexual dysfunction and male fertility enhancement,
as well as drug development and design. The Scientific Advisory Board meets
periodically with management and in smaller groups from time to time on an
informal basis. The members assist the Company in identifying scientific and
product development opportunities and reviewing with management the progress of
our specific projects.

The members of our Scientific Advisory Board are the following:

PROFESSOR GAVIN VINSON is currently Chair of Biochemistry at Queen Mary and
Westfield College, University of London. During the last decade, Professor
Vinson held numerous posts at QMUL including Head of Division of Biomedical
Science, Dean of the Faculty of Basic Medical Sciences, and Professor and Head
of Department of Biochemistry. Throughout Professor Vinson's career he has
published over 230 papers of original research, 30 reviews, book chapters and
articles all in the field of molecular and cellular endocrinology, as well as
approximately 300 abstracts of presentations at meetings. As a result of his
prominent record, Professor Vinson has been honored as a Medallist of the
Society for Endocrinology and the British Neuroendocrine Group. He is active as
a prominent member of numerous specialist endocrinology bodies, including past
Council member of the Society for Endocrinology and Editor-in-Chief of the
Journal of Endocrinology. Professor Vinson holds B.Sc., Ph.D., and D.Sc. degrees
from the University of Sheffield, Sheffield, UK.

GEORGE MARGETTS, M.D. has served as Chief Medical Consultant to Bioenvision Inc.
since December 1998. Since 1990, Dr. Margetts has held the position of Managing
Director, Stegram Pharmaceutical Ltd. From 1984 to 1990, Dr. Margetts served as
Executive Vice-President Research and Managing Director of Sterling Winthrop
Group, as well as its Medical Director between 1971 and 1989. Dr. Margetts holds
B. Pharm. and M.Sc. degrees from the University of London and M.R.C.S.,
L.R.C.P., M.D. and B.Sc. degrees from University College Hospital Medical
School, London.


                                     - 53 -
<PAGE>

DR. MALCOLM THOMAS has held numerous senior management positions in Clinical
Pharmacology at Glaxo Wellcome in both the UK and the United States. From 1981
to 1995, Dr. Thomas served as Head Clinical Pharmacology, at Glaxo Research
Group in Ware, UK; and from 1995 to 1998, was appointed as Director Clinical
Pharmacology, Glaxo Wellcome, Greenford, UK. From 1998 to 1999, Dr. Thomas
served as United States Director Clinical Pharmacology, Glaxo Wellcome, at
Research Triangle Park in North Carolina, before returning to Greenford to
resume his duties as Director Clinical Pharmacology until 2001. Dr. Thomas is a
recognized expert in early drug development up to and including Phase II
clinical trials in therapeutic areas including cardiovascular, gastrointestinal,
respiratory, migraine and rheumatology. Mr. Thomas holds B.Ch. and M.B. degrees
from the University of Wales; M.R.C.P, United Kingdom; and F.R.C.P from the
University of London. In 1980, Dr. Thomas received his accreditation from the
Society of Clinical Pharmacology and Therapeutics (SCPT).

DR CLAUDE LARUELLE

Mr. Claude Laruelle, CEO and founder of CLL Pharma, has a broad experience (30
years) in the field of pharmaceutical developments. He started at the CNRS
(Centre National de la Recherche Scientifique) in Paris and obtained his
chemical engineer degree and PhD in Medicinal Chemistry from Paris-Sorbonne
University. Mr. Laruelle served as founder and Managing Director of PANMEDICA
GROUP (Subsidiary of VIRBAC) from 1979 to 1993.

DR GERALD CURTIS B.Sc., Ph.D.

DR. GERALD CURTIS was, until recently founder and Managing Director, Bowman
Research Ltd., a UK-based contract research organization dedicated to the
design, conduct and management of pre-clinical and clinical drug development.
From 1966 to 1979, Dr. Curtis served as medical researcher and lecturer in
Biochemistry at the University of Wales (UWCC); and from 1972 to 1981, held the
position of Visiting Professor at the Department of Biochemistry and Molecular
Biology, Northwestern University, Illinois, USA. Dr. Curtis was appointed as
Senior Lecturer (1979-1981) and Reader (1987-1993) in Biochemistry at UWCC. From
1985 to 1993, Dr. Curtis served as Director of Organ Perfusion Unit, a
University of Cardiff-based contract research organization and Managing Director
(1993-1997) of BioDynamics Research Ltd., an independent privately owned CRO.
From 1996 to 1999, Dr. Curtis was appointed Research Professor, University of
Wales Institute, Cardiff. Dr. Curtis is a recognized expert in the development
and validation of ex vivo systems for drug development and strategies for
extrapolating data from animals to humans. Dr. Curtis has published numerous
research reviews, papers, and proceedings, and holds a number of patents. Dr.
Curtis received his BSc in Biochemistry and Physiology, Honors degree in
Biochemistry, and Ph.D. in Biochemistry, from the University of Wales.

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

The following table sets forth certain information regarding the ownership of
our common stock as of December 31 , 2004 by (i) all those known by our
management to be owners of more than five percent of the outstanding shares of
common stock; (ii) each officer and director; and (iii) all officers and
directors as a group. Unless otherwise indicated, each of the shareholders has
sole voting and investment power with respect to the shares owned (subject to
community property laws, where applicable), and is beneficial owner of them.


                                     - 54 -
<PAGE>

    NAME & ADDRESS OF                       AMOUNT & NATURE OF      PERCENT OF
    BENEFICIAL OWNER                        BENEFICIAL OWNERSHIP    CLASS (1)

TITLE OF CLASS
--------------------------------------------------------------------------------
Lee Cole 712,Fifth Avenue, New York                nil
F Armstrong, Savannah House, London                nil
K Bilyard, Savannah House                         250,000              0.6
L Boyne, Savannah House, London                    nil
N Rulewski,712,Fifth Avenue< New York             250,000              0.6
C O'Toole, 712,Fifth Avenue< New York             250,000              0.6
A Cosentino, 712, Fifth Avenue, New York          250,000              0.6

                                                                      CURRENT
                                            BENEFICIAL OWNERSHIP    PERCENTAGE
NAME                                              OF STOCK          OF CLASS(1)
---------------------------------------     --------------------    ------------

All Executive officers
and directors as a group                       1,000,000               2.5

Jano Holdings, Suite F8,ICC,Gibraltar          3,968,410              10.0
Lifescience Ventures Ltd, Suite F8,ICC
       Gibraltar.                              3,443,254               8.6
Mommay Ltd 712, Fifth Avenue, New York         4,172,247              10.5
Technology Finance Inc, P.O. Box 3075,
       Roadtown, Tortolla, BVI                 5,169,322              13.0

(1) Based on a total of 39,794,362 shares of common stock outstanding as of
December 31, 2004 on a fully diluted basis.

ITEM 12 - CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

None

ITEM 13 - EXHIBITS AND REPORTS ON FORM 8-K

(a) Exhibits:

Exhibit
Number                              Description
-------                             -----------
10.01           Agreement and Plan of Reorganization between Registrant and
                Bioaccelerate, Inc dated August 6th, 2004 (1)

10.02           Amendment to Agreement and Plan of Reorganization by and between
                Registrant and Bioaccelerate, Inc dated August 31, 2004 (2)

10.03           Certificate of Incorporation of Registrant (3)

10.03 (a)       Amendment to Certificate of Incorporation filed September 23,
                2004 (4)


                                     - 55 -
<PAGE>

10.04           Amended and Restated By-Laws of the Registrant (5)

10.05           Credit Facility Agreement by and between Technology Finance Inc
                and Bioaccelerate Inc dated February 9th, 2004

10.06           Credit Facility Agreement by and between Jano Holdings Limited
                and Bioaccelerate Holdings Inc dated 28th September, 2004

10.07           Credit Facility Agreement by and between Lifescience Ventures
                Limited and Bioaccelerate Holdings, Inc dated 28th September,
                2004

(1)             Incorporated by reference and filed as an Exhibit to
                Registrant's current Report on Form 8-K filed with the SEC on
                August 9, 2004.

(2)             Incorporated by reference and filed as an Exhibit to
                Registrant's current Report on Form 8-K filed with the SEC on
                September 27, 2004

(3)             Incorporated by reference and filed as an Exhibit to
                Registrant's SB/2 filed with the SEC on August 4, 2000

(4)             Incorporated by reference and filed as an Exhibit to
                Registrant's current Report on Form 8-K filed with the SEC on
                September 27, 2004

(5)             Incorporated by reference and filed as an Exhibit to
                Registrant's SB/2 filed with the SEC on August 4, 2000

31.1            Certification of CEO Pursuant to Securities Exchange Act Rules
                13a-14 and 15d-14, as Adopted Pursuant to Section 302 of the
                Sarbanes-Oxley Act of 2002.

31.2            Certification of CFO Pursuant to Securities Exchange Act Rules
                13a-14 and 15d-14, as Adopted Pursuant to Section 302 of the
                Sarbanes-Oxley Act of 2002.

32              Certification Pursuant to 18 U.S.C. Section 1350, as Adopted
                Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

(b) Reports on Form 8-K:

A Form 8-K filing was filed on 9th August 2004 , reporting that the Company
entered into an agreement to acquire all of the issued and outstanding common
stock of Bioaccelerate, Inc., a Delaware corporation. A Form 8-K filing as filed
on 27th September 2004, reporting the completion of the acquisition of
Bioaccelerate Inc.

On May, 4th, 2005 the company filed a Form 8/K reporting that the company had
terminated F E Hanson Limited as the company's auditor and appointed Stark,
Winter, Schenkein, & Co LLP as the company auditor.

All 8-K's filed are hereby incorporated by reference.


                                     - 56 -
<PAGE>

ITEM 14 - PRINCIPAL ACCOUNTANT FEES AND SERVICES.

The following table presents fees for professional services rendered by our
Principal Accountants for the audits of the Company's annual consolidated
financial statements for 2005 and 2004 and other services.

                                                  2005              2004
                                                 -------           -------
      Audit Fees                                 $42,300           $14,000

      Audit-Related Fees                              --                --

      Tax Fees                                         0                 0

      All Other Fees                                  --                --
                                                 -------           -------

      Total Fees                                 $42,300           $14,000
                                                 =======           =======

AUDIT FEES consist of fees billed for professional services rendered for the
audit of our consolidated financial statements and review of the interim
consolidated financial statements included in quarterly reports and services
that are normally provided by our Principal Accountant in connection with
statutory and regulatory filings or engagements.

AUDIT-RELATED FEES consist of fees billed for assurance and related services
that are reasonably related to the performance of the audit or review of the
Company's consolidated financial statements and are not reported under "Audit
Fees."

TAX FEES consist of fees billed for tax advice, tax compliance and tax planning
services.

AUDIT COMMITTEE PRE-APPROVAL PROCEDURES

The Company has not yet appointed an Audit Committee. Our Board of Directors
approves the engagement of our independent auditors to render audit and
non-audit services before these services are rendered. All of the services
performed by the Company's Principal Accountant for us were pre-approved by the
Directors.

SIGNATURES

Persuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned.

                          Bioaccelerate Holdings, Inc.


Date: September 16, 2005                By: /s/ Lee Cole
                                            ------------------------------------
                                                                        Lee Cole
                                                         Chief Executive Officer

                                        By: /s/ Linden Boyne
                                            ------------------------------------
                                                                    Linden Boyne
                                                         Chief Financial Officer


                                     - 57 -