SECURITIES AND EXCHANGE COMMISSION
                     WASHINGTON, D.C. 20549

                           FORM 10-K

          Annual Report Pursuant to Section 13 or 15(d)
             of the Securities Exchange Act of 1934

For the Fiscal Year Ended 12/31/01    Commission File Number    0-10822

                           BICO, Inc.
     (Exact name of registrant as specified in its charter)

               Pennsylvania                       25-1229323
     (State or other jurisdiction of           (I.R.S. Employer
        incorporation or organization)        Identification Number)

     2275 Swallow Hill Road, Bldg. 2500, Pittsburgh, Pennsylvania  15220
       (Address of principal executive offices)                 (Zip Code)

Registrant's telephone number, including area code (412) 429-0673

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

   Securities registered pursuant to Section 12(g) of the Act:
                  Common Stock, $.10 par value

Indicate  by check mark whether the registrant (1) has filed  all
reports  required  to be filed by Section  13  or  15(d)  of  the
Securities  Exchange Act of 1934 during the preceding  12  months
and (2) has been subject to such filing requirements for the past
90 days.   Yes   X       No  ___

Indicate  by  check  mark  if  disclosure  of  delinquent  filers
pursuant  to Item 405 of Regulation S-K is not contained  herein,
and will not 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-K, or any amendment to this
Form 10-K. [ ]

The   aggregate  market  value  of  the  voting  stock  held   by
nonaffiliates of the registrant as of March 28, 2002:

Common Stock, $.10 par value --$48,943,248

As  of  December 31, 2001, 2,450,631,111 shares of common  stock,
par value $.10 per share, were outstanding.

As  of  December 31, 2001, 16,930 shares of preferred stock,  par
value $10 per share, were outstanding.

          Exhibit index is located on pages 41 to 43



Item 1.  Business

General Development of Business

BICO, Inc. was incorporated in the Commonwealth of
Pennsylvania in 1972 as Coratomic, Inc.   Our manufacturing,
research & development operations are located at 625 Kolter Drive
in Indiana, Pennsylvania, 15701, and our administrative offices
are located at 2275 Swallow Hill Road, Pittsburgh, Pennsylvania,
15220.

Our primary business is the development of new devices and
technologies, which include environmental products, which help to
clean up oil spills, procedures relating to the use of regional
extracorporeal hyperthermia in the treatment of cancer, and
models of a noninvasive glucose sensor. Regional extracorporeal
hyperthermia is a system that circulates fluid in a specific area
of the body after the fluid has been heated outside the body.
The circulated fluid's higher temperature helps treat certain
diseases by inducing an artificial fever that kills targeted
cells.  Our noninvasive glucose sensor helps diabetics measure
their glucose without pricking their fingers or having to draw
blood.

We have several subsidiaries that specialize in those
different projects.  Petrol Rem, Inc. handles our environmental
products PRP, BIOSOK and BIOBOOM  that help clean up oil
spills and other pollutants in water. ViaCirq, Inc. handles the
hyperthermia project, a technology called the ThermoChem System.
Diasense, Inc. manages the noninvasive glucose sensor project.
Our Biocontrol Technology division focuses on our biomedical
projects and on contract research and manufacturing.


Forward-Looking Statements

From time to time, we may publish forward-looking statements
relating to such matters as anticipated financial performance,
business prospects, technological developments, new products,
research and development activities, the regulatory approval
process, specifically in connection with the FDA marketing
approval process, and similar matters.  You need to know that a
variety of factors could cause our actual results to differ
materially from the anticipated results or other expectations we
expressed in our forward-looking statements.  The risks and
uncertainties that may affect our operations, performance,
research and development and results include the following:
additional delays in the research, development and FDA marketing
approval of the noninvasive glucose sensor; delays in the
manufacture or marketing of our other products and medical
devices; our future capital needs and the uncertainty of
additional funding; competition and the risk that the noninvasive
glucose sensor or our other products may become obsolete; our
continued operating losses, negative net worth and uncertainty of
future profitability; potential conflicts of interest; the status
and risk to our patents, trademarks and licenses; the uncertainty
of third-party payor reimbursement for the sensor and other
medical devices and the general uncertainty of the health care
industry; our limited sales, marketing and manufacturing
experience; the amount of time or funds required to complete or
continue any of our various products or projects; the attraction
and retention of key employees; the risk of product liability;
the uncertain outcome and consequences of the lawsuits pending
against us; our ability to maintain a trading market for our
common stock; and the dilution of our common stock.

Description of Business

               Petrol Rem's Environmental Projects

BIOREMEDIATION AND OIL SPILL CLEAN UP

We are involved in the field of biological remediation, or
bioremediation, development. Bioremediation technology uses
naturally occurring microorganisms or bacteria to convert various
types of contamination, like oil spills, to carbon dioxide and
water.  The product, PRPr, which stands for Petroleum Remediation
Product, is designed as an environmental microbial microcapsule,
which is used to collect, contain and separate oil-type products
in or from water. The product's purpose is to convert the
contaminant, with no leftover residue in need of disposal.  When
the PRPr comes in contact with the petroleum substances like oil
spills, the oil spills become bound or attached to the PRPr, and
they stay afloat.  Because the product contains the necessary
nutrients and microorganisms, the bioremediation process begins
immediately, which limits secondary contamination of the air or
surrounding wildlife.  Eventually, the product will break down
both the petroleum and itself, leaving nothing but carbon dioxide
and water.

In 2001, Petrol Rem filed a new patent application for PRP and
its manufacture without the addition of microorganisms.
Scientific experimentation and current literature indicate that
bioremediation occurs at the same efficient level without the
added microorganisms, allowing us to cut manufacturing costs
without sacrificing performance.  The patent is currently
pending.

In late 2000, Petrol Rem acquired 51% of INTCO, a Louisiana
company that specializes in regional oil spill clean-ups,
primarily on the Gulf coast of southeast Louisiana, for an
investment of approximately $1.25 million, all of which was paid
during 2001. INTCO has been using Petrol Rem's oil spill clean-up
products in clean up projects.  INTCO was generating income when
we acquired our interest in 2000, and its revenues have helped
Petrol Rem's revenue flow.

During 2001, Petrol Rem focused on the Asian market.  In 2000,
Petrol Rem hired a vice president of Asian sales and marketing
who speaks four languages fluently, including English.  His
efforts helped increase the number of Asian distributors, which
resulted in increased sales.

Petrol Rem's revenues increased significantly during 2001, due
primarily to INTCO's revenues.  Petrol Rem's total revenues for
2001 were approximately $3.384 million.  Of that, approximately
$3.2 million was from INTCO and $108,000 was from bioremediation
products.

In December 2001, Petrol Rem signed a two-year agreement with
Belgian-based Clean World Solutions.   The agreement grants Clean
World exclusive master distributorship rights to all of Petrol
Rem's oil spill absorption and bioremediation products throughout
Europe.  Clean World placed its initial order, for $110,000, in
January 2002.

Clean World plans to grant sub-distributor agreements in each
country covered by the agreement.  They have already signed
agreements with companies in Germany, Belgium and Luxemburg.  For
more information on Clean World Solutions, you should visit their
website at www.cleanworldsolutions.com.

Clean World Solutions will operate the agreement through its
recently-formed division called Petrol Rem Europe.  Petrol Rem
Europe officially launched its sales and marketing efforts for
the Bio-Sok at a German boat show held January 9-14, 2002 in
Dusseldorf.  The European product launch for PRP took place at
the International Maritime Organization's Third Research and
Development Forum on High-density Oil Spill Response, was held in
Brest, France in mid-March 2002.

Petrol Rem received a distribution agreement for approximately
$125,000 per year from Alaskan oil spill clean-up company called
F.R.O.G. to distribute Petrol Rem products. The contract has an
initial term of one year, with automatic renewals on a yearly
basis.  Due to the September 11th tragedy, the Alaskan company
was initially focused on other matters, and they placed their
first order in November 2001.  Due to the extreme winter weather
in Alaska, we expect additional orders to begin in the late
spring.

In March 2002, we announced that Petrol Rem had named Winner
Advertising of Sharon, PA as its agency of record to assist with
its marketing, brand management, advertising, public and media
relations.  Petrol Rem is marketing PRPr through trade shows,
magazines, direct mail advertising, and direct contacts with
companies and consultants specializing in petroleum clean-up, as
well as marketing directly to municipalities and corporations
with needs for the product.  Petrol Rem also has an international
market, with its primary customers in Indonesia and Europe.

In March 2002, we announced that Corpfin.com, an Atlanta company,
has agreed to undertake the process of taking Petrol Rem from a
private company to a public company.  Since the process is just
beginning, we don't know how long the process might take, or what
the terms of the transaction might be.

Part of Petrol Rem's initial research and development involved
field-testing supervised by the National Environmental Technology
Applications Corporation. That group, which is known as NETAC, is
endorsed by the Environmental Protection Agency to determine
whether products are effective.  As a result of their testing,
NETAC reported positive results regarding the effectiveness of
the product.

The product is listed on the EPA's National Contingency Plan
Product Schedule, and is available in free-flowing powder or
absorbent socks.  In 1995, the EPA required that all products
previously listed on the National Contingency Plan Product
Schedule be submitted to additional testing.  Because PRPr
successfully passed the test conducted by NETAC, the product was
requalified for listing on the EPA's product schedule.  In
addition, PRP was one of only fourteen products listed after the
1996 Alternative Response Tool Evaluation System was implemented.

In April 1993, Petrol Rem entered into a lease for a facility in
the Pittsburgh, Pennsylvania area, which is used to manufacture
PRPr.  The current lease has a renewable three-year term, with
monthly rental payments of $4,661 plus utilities and applicable
business privilege taxes.  Petrol Rem purchased equipment, which
has the capability to produce PRPr in quantities of 2,000 pounds
per day, and has built an adequate inventory.

Petrol Rem also completed development of a new spray applicator
for its PRP product.  The new applicator is a lightweight,
portable unit, which provides a more continuous flow of product.
The lighter weight and smaller size will allow easier access to
remote sites, which were impossible to reach with the previous
applicator.

In addition to PRP, Petrol Rem also developed other products.
In order to address water pollution issues at marinas, Petrol Rem
introduced the BIOSOK, which is PRP contained in a 10" fabric
tube, and is designed and used to aid in the cleaning of boat
bilges.  Bilges are commonly cleaned out with detergents and
other chemicals, which cause the oil pumped out of the bilge to
sink to the bottom of the water, where it is harmful to marine
life, and becomes difficult to collect. In addition, it is
illegal to dump oil or fuel into the water.  The BIOSOK, when
placed in the bilge, absorbs and biodegrades the oil or fuel on
contact, which significantly reduces or eliminates the pollution;
then the product biodegrades itself.  As a result, BIOSOK helps
to keep waters clean.  In addition, BIOSOK helps eliminate the
chore of bilge cleanup, and helps users such as boaters and
marinas to avoid fines for pumping oil and fuel into the
waterways, which is prohibited.  The U.S. Coast Guard is using
the BIOSOK in certain regions on their vessels and maintains a
sufficient supply to provide continuing availability.

Petrol Rem's BIOBOOM  product is used in water clean-up
projects. The product is a 3" x 10' fabric tube which is filled
with PRPr, and is used to both contain and biodegrade
contaminants in water.  BIOBOOM  is a superior product to most
containment products because, in addition to containing the oil
or fuel spill, or restricting the spread of an anticipated spill,
it also biodegrades the contaminant, and then biodegrades itself.
These features act to virtually eliminate secondary contaminants,
thereby reducing disposal and clean-up costs.

Petrol Rem markets the BIOSOK and BIOBOOM  at wholesale prices
ranging from $11-$13, and $110-$130, respectively, depending on
the quantity purchased.

We believe that we have spent all of the funds necessary to
complete the development of its bioremediation products, and to
build up sufficient inventory pending additional orders.  We
expect that our expenses going forward will be for marketing and
sales.   We spent approximately $17.8 million on this project
through December 31, 2001.  We have been funding this project
since 1992 with money we raised by selling our securities,
including our stock or convertible debentures.

TIRE PILE CLEANUP AND OTHER PROJECTS

In 2000, Petrol Rem formed a joint venture called Tireless, LLC,
which was formed to handle the environmental and business
concerns arising from scrap and discarded tires. In 2001,
Tireless obtained a portable tire shredder, which allows Tireless
to go directly to the tire pile sites to coordinate shredding and
recycling.   In September 2001, Tireless received a sub-contract
to remediate discarded tires at one of the nation's largest tire
piles near Upper Sandusky, Ohio.  Tireless is now shredding tires
at that site, and we began billing during the third quarter of
2001.   We believe the Tireless sub-contract could generate
revenue of at least $500,000 over the next year based on our
equipment's capacity to shred tires over the one-year period of
the contract.

During 2001, through our subsidiary Petrol Rem, we've also loaned
money to Practical Environmental Solutions, Inc., a Pennsylvania
company that acquired technology used to safely convert municipal
sludge to recyclables that comply with state and federal
environmental laws.  Petrol Rem has loaned a total of $3.1
million to Practical Environmental as of December 31, 2001.
Practical Environmental has made interest payments on the amount
due. The loan, which was originally due on August 31, 2001 has
been extended until May 31, 2002; no principal payments have been
made to date. Our management is considering whether to convert
all or part of that loan to an equity investment - they are
making that decision because Practical Environmental is willing
to make that conversion and because Practical Environmental has
been generating revenues since January 2001.  As of December 31,
2001, Practical Environmental's internal financial information
shows revenues of $537,100; they are still operating at a loss.
We don't currently intend to make any additional loans or
investments in Practical Environmental, except for the possible
conversion of the existing loan to equity.

          ViaCirq's Extracorporeal Hyperthermia Project

CURRENT STATUS OF THE VIACIRQ PROJECT

Our subsidiary, ViaCirq, is the developer and marketer of the
ThermoChem HT System, which received FDA clearance to market in
January 2000.  The ThermoChem HT System is used to deliver
intraperitoneal hyperthermia, known as IPH.  Intraperitoneal
means within the abdominal cavity.  Hyperthermia involves using
heat to raise temperatures.  Surgeons use intraperitoneal
hyperthermia in conjunction with cytoreductive surgery - surgical
removal of cancer - and chemotherapy to treat advanced stages of
gastric cancer, colorectal cancer, appendiceal cancer, ovarian
cancer and other cancer that has spread to the lining of the
abdominal cavity.

Medical studies indicate that cancer that has spread to the
lining of the abdominal cavity is often accompanied by malignant
ascites - when cancer spreads in non-segregated tumor form, bowel
obstruction, pain, poor survival and poor quality of life.

Surgery alone may not permit the complete removal of the tumor
and microscopic residual disease often remains when the surgery
is finished.  Intravenous chemotherapy can be diluted by the time
it reaches the tumors in the abdominal cavity; thus leaving the
remaining cancer unaffected.  As a result, the cancer often
persists despite surgery and IV chemotherapy, resulting in
patients having few if any options.

A procedure, pioneered at Wake Forest University School of
Medicine, combines cytoreductive surgery, chemotherapy and
intraperitoneal hyperthermia to yield positive survival and
quality of life outcomes for patients with these advanced cancers
that have spread to the lining of the abdominal cavity.  These
results have been published in numerous medical journals
including, The American Surgeon and The European Journal of
Surgical Oncology.

In a surgical procedure, 2 incoming catheters with temperature
probes are placed in the upper abdomen and 2 outgoing catheters
with temperature probes are placed in the lower abdominal cavity
in the pelvic area; then the abdominal cavity is temporarily
closed.  The ThermoChem HT System is primed and begins
circulating 3 liters of heated sterile solution through the 2
ingoing catheters, throughout the abdominal cavity with the
heated sterile solution returning to the ThermoChem through the 2
outgoing catheters that are placed in the lower abdominal cavity
in the pelvic area.  The continuous circulation of heated sterile
solution raises the core temperature of the abdomen, to the
desired temperature of the surgeon, in the range of 41 C (105.8
F) to 42 C (107.6 F).  This procedure is known as intraperitoneal
hyperthermia, or IPH.

Before intraperitoneal hyperthermia is used on a patient in a
surgical procedure, the surgeon makes a midline abdominal
incision to expose the entire abdominal cavity.  Tumors within
the abdominal cavity are surgically removed to the extent
possible.  Ingoing and outgoing catheters are placed and the
patient's abdominal cavity is temporarily closed.  The ThermoChem
HT System administers intraperitoneal hyperthermia.  When the
desired core temperature, as directed by the surgeon, of the
abdominal cavity is reached, at the surgeons choice, chemotherapy
may be administered to the abdominal cavity during the procedure.
After 2 hours of intraperitoneal hyperthermia, the sterile
solution is circulated out of the abdominal cavity and the
catheters are removed.  The surgical procedure is completed and
the patient is transferred to the Intensive Care Unit.

The commercial availability of the ThermoChem HT System can now
provide the broader adoption of this combined treatment within
the surgical oncology community.

During 2000, we focused on forming a Quality Control System and
geared-up for manufacturing and marketing of the ThermoChem HT
System. We entered into long-term use agreements with Wake Forest
University Medical Center in Winston-Salem, NC and Zale Lipshy
University Hospital at Southwestern Medical Center in Dallas,
Texas.

During 2001, our management team recruited a sales force and
focused on marketing the ThermoChem HT System.  In March 2001, we
introduced our technology at the annual cancer symposium meeting
of The Society of Surgical Oncology in Washington, DC.  In 2001,
we entered into long-term use agreements with The University of
Pittsburgh Medical Center in Pittsburgh, PA; Baylor University
Medical Center in Dallas, TX; and Sharp Memorial Hospital in San
Diego, CA to use the ThermoChem HT System to administer
intraperitoneal hyperthermia as part of their surgical oncology
program.  We have entered into evaluation agreements in which the
Company is paid on a per IPH procedure to evaluate the program.
These institutions include; Veterans Affairs Medical Center in
Pittsburgh, PA; Veterans Affairs Medical Center in Cincinnati,
OH; Greenville Memorial Hospital in Greenville, SC; St. Agnes
Healthcare in Baltimore, MD; Dekalb Medical Center in Atlanta,
GA; Kettering Medical Center in Dayton, OH; the University of
Washington Medical Center in Seattle, WA; and the University of
Maryland Medical Center in Baltimore, MD.

In 2001, the Company sponsored the first and only long-term
quality of life study with Wake Forest University Baptist Medical
Center involving patients who have survived greater than three
years following intraperitoneal hyperthermia in conjunction with
cytoreductive surgery and chemotherapy.

The results of this long-term quality of life study were
presented at the 55th annual Society of Surgical Oncology
symposium in March of 2002.

In 2001, ViaCirq's board of directors, along with their
stockholders, including BICO, decided to split whole body
hyperthermia utilizing the ThermoChem System and regional
hyperthermia utilizing the ThermoChem HT System into two separate
companies.  ViaCirq will continue to develop, market and sell the
ThermoChem HT System for regional hyperthermia treatments such as
intraperitoneal hyperthermia.  The ThermoChem HT System can be
used for other regional hyperthermia treatments, which will
require FDA approval, such as the chest cavity perfusion,
isolated lung perfusion, isolated limb perfusion and liver
perfusion.

The newly created ViaTherm, Inc., will focus on the development
of the ThermoChem System for whole body hyperthermia for
metastatic lung cancer and HIV.

Although we had hoped to enter into an agreement with a hospital
group in China, the tragic events of September 11, 2001 and their
impact on international travel, trade and communications made
such an arrangement impossible at this time.

HISTORY AND DEVELOPMENT OF THE THERMOCHEM AND THERMOCHEM HT
SYSTEMS

ViaCirq was incorporated on October 23, 1992 as IDT, Inc.
ViaCirq focused on the research and development of the ThermoChem
System and associated disposables as a delivery system for
perfusion induced systemic hyperthermia - known as PISH - a form
of whole body hyperthermia, in the treatment of certain types of
cancers and HIV/AIDS.  Perfusion induced systemic hyperthermia is
the elevation of the body's core temperature, which is like
inducing an artificial fever.  Perfusion induced systemic
hyperthermia uses a device connected to incoming and outgoing
outlet catheters in the body to circulate blood outside the body
through a heat exchanger that heats the circulating blood.  This
continuously circulating heated blood in and out of the body
raises the core body temperature inducing the artificial fever.

In 1993, ViaCirq formed an alliance with HemoCleanse, Inc.
located in Lafayette, Indiana.  HemoCleanse, Inc., founded in
1989, designs, manufacturers and markets medical devices and
disposables for the treatment of blood outside the body.

HemoCleanse's core product was the BioLogic System, which
consists of a sophisticated, computer controlled multi-treatment
device and a series of single-use disposable treatment kits.
HemoCleanse's unique technology is based on special chemical
sorbents that selectively remove toxins from the blood while
balancing critical blood chemistries.  The BioLogic System
received clearance by the FDA in 1994 as a detoxifier for
treatment of drug overdose; in 1996 the BioLogic System received
FDA clearance for use in treating patients with liver failure.
We believed that HemoCleanse's core technology was essential in
developing a safe delivery system for whole body hyperthermia.

In 1993, we entered into a license agreement with HemoCleanse to
develop the ThermoChem technology for delivering extracorporeal
hyperthermia.  Under the license agreement, we received worldwide
rights to market the ThermoChem technology and disposables while
HemoCleanse retained worldwide manufacturing rights for
ThermoChem technology and disposables.  We funded HemoCleanse's
development of a prototype of the ThermoChem System for PISH.
The prototype was used in preclinical trials and subsequently in
the first ever FDA approved clinical trials for AIDS and non-
small cell lung cancer (NSCLC).

The ThermoChem System consists of two components: ThermoChem HT
System and ThermoChem SB System that are necessary for delivering
PISH, a form of whole body hyperthermia.

ThermoChem HT System is fully integrated system that heats,
circulates and maintains desired blood/fluid temperatures in
delivery of whole body hyperthermia or regional hyperthermia.

ThermoChem SB System is used in conjunction with the ThermoChem
HT System to deliver whole body hyperthermia by balancing blood
chemistries on a real-time basis while removing toxins.

It is common knowledge that higher temperatures of the body, like
natural fevers, can serve to control infections.  Using this
concept, the ThermoChem System induces an artificial fever to
107.6 F, which is whole body hyperthermia.  During whole body
hyperthermia, however, blood chemistries shift potentially
causing severe organ damage and possibly death.

The ThermoChem System is a unique system that incorporates the
features of the ThermoChem HT, but also automatically balances
electrolytes and important nutrients using the chemical exchange
characteristics of the ThermoChem SB, while simultaneously
removing many small toxins.  The electrolytes and nutrients flow
from the sorbent to the blood until equilibrium is reached.
Unbound toxins flow freely from the blood and bind to the
charcoal of the suspension.

There are many methods of inducing whole body hyperthermia
including radiant heat chambers, microwave heat chambers, water
blankets and PISH.  Medical literature shows that PISH allows for
a more uniform heating of the body and a higher sustained body
temperature, which provides for a better lethal effect to the
cancerous tumor.

Perfusion Induced Systemic Hyperthermia Utilizing the ThermoChem
System

Perfusion induced systemic hyperthermia, known as PISH, is
achieved through extracorporeal blood heating which involves
heating the patient's blood outside the body to a maximum of
118.4 F and returning it back to the body, thus raising the
body's core temperature to the desired treatment temperature up
to a maximum of 108.4 F for 2 hours.  Catheters are placed in two
venous access sites and attached to the disposable tubing of the
ThermoChem HT.  Blood passes a roller pump that sends it onward
to the heat exchanger where indirect heating of the blood occurs,
raising the outside blood temperature to a maximum of 118.4 F. A
portion of the blood passes through a T-connection to the
ThermoChem SB, located between the roller pump and the heat
exchanger, where it is chemically balanced on a real-time basis
and then returned to the blood flow path before it reaches the
heat exchanger.  Continually circulating blood is returned to the
patient at approximately 114.8 F, gradually raising the patient's
core body temperature to the desired temperature, which is
measured by various temperature probes throughout the body.

Physicians have known that cancer cells are sensitive to heat,
but only recently have the mechanisms of hyperthermia on cancer
cells been understood.  The vascular structure in tumors
restricts blood supply so a tumor will retain heat, which
destroys cellular components essential for a tumor to exist while
certain chemotherapeutic drugs are potentiated by heat.

Beginning 1994, the safety and efficacy of perfusion induced
systemic hyperthermia utilizing the ThermoChem System was
evaluated in the following FDA approved and hospital
Institutional Review Board clinical trials:

St. Elizabeth Hospital - Lafayette, Indiana

  1.  Phase I trial completed under protocol entitled " Evaluation
     of Whole-Body Hyperthermia Utilizing the ThermoChem Technology in
     the Treatment of Kaposi's Sarcoma with AIDS."  This was the first
     FDA approved whole body hyperthermia study and was published in
     The Journal of Acquired Immunodeficiency Syndrome and Human
     Retrovirology.

  2. Phase II trial completed under protocol entitled
     "Extracorporeal Whole-Body Hyperthermia Treatments for HIV
     Infections and AIDS" with results published in American Society
     for Artificial Internal Organs (ASAIO) Journal.

University of Texas Medical Branch at Galveston

Phase I clinical trial completed in 2001 utilizing the ThermoChem
System and disposables to deliver perfusion induced systemic
hyperthermia for patients with non-small cell lung cancer.  Non-
small cell lung cancer remains a major cause of cancer morbidity
and mortality in the United States and Europe.

One of the objectives of this trial was to evaluate the
ThermoChem technology for treatment of metastatic non-small cell
lung cancer with regard to patient selection, tumor response,
patient performance status, and patient survival.  The follow-up
of the patients is patterned after the Southwest Oncology
protocols, which are considered state-of-the-art to follow
response of cancer to the therapy.  Results of this study have
been published in Annals of Thoracic Surgery; Perfusion; and
American Society of Artificial Organs.

ThermoChem HT System   is a fully integrated system that heats,
circulates and maintains desired blood/fluid temperatures in
delivery of whole body hyperthermia or regional hyperthermia. All
operating parameters of the system are monitored by a computer
and displayed and managed through an interactive video touch
screen display.  The operator can access all system controls and
operations, in-put all necessary patient data, and define and
adjust treatment parameters with just a touch of the finger.
Beginning in May 1998, the safety and efficacy of intraperitoneal
hyperthermia utilizing the ThermoChem HT System was evaluated in
an FDA approved and Institutional Review Board clinical trial.

Wake Forest University School of Medicine

In May 1998, an Investigational Device Exemption, or IDE was
approved by the FDA to allow human clinical trials utilizing the
ThermoChem HT System and related disposables for IPH used an
adjunct therapy with surgery and chemotherapy.

In a surgical procedure all cancerous growths are surgically
removed from the patient's abdomen and pelvis; while all spaces
and lining surfaces are opened, the abdomen is circulated with a
heated physiologic solution circulating for a 2-hour period using
the ThermoChem HT System with.

The technique, using IPH, surgery and chemotherapy has been done
at Wake Forest University Baptist Medical Center since 1991 and
is now offered as a standard-of-care for the treatment of
advanced ovarian and gastrointestinal cancer.

ViaCirq and the surgeons at Wake Forest believe the ThermoChem HT
can possibly make IPH more efficient and standardize the
technique and educate others on the utilization of the ThermoChem
HT allowing more physicians to provide the life extending
treatment for patients with this advanced cancer.

In April 1999, a study was completed on patients with advanced
ovarian and gastrointestinal cancer utilizing the ThermoChem HT
System.

In May 2000, we entered into a Research Agreement with Wake
Forest School of Medicine using the ThermoChem HT System and
disposables to deliver intraperitoneal hyperthermia in
combination with cytoreductive surgery and chemotherapy in the
primary treatment of ovarian cancer.  One of the main objectives
of the study is to determine the response to intraperitoneal
hyperthermia and chemotherapy as a combined therapy in patients
with Stage III ovarian cancer.  The IPH treatment will be
repeated 6 months later during second-look surgery if the patient
has no residual disease.  The study is currently ongoing.

Quality of Life Study

In 2001, we sponsored the first and only long-term quality of
life study with Wake Forest University Baptist Medical Center
involving patients who have survived greater than three years
following intraperitoneal hyperthermia in conjunction with
cytoreductive surgery and chemotherapy.

ViaCirq and the surgeons at Wake Forest believe that the
ThermoChem HT System can make the technique more effective with
better temperature monitoring and control.  This procedure is
offered as a standard-of-care for treatment of patients with
advanced ovarian and gastrointestinal cancer.

Medical Advisory Board

ViaCirq has a medical and scientific advisory board that is made
up of these professionals.  Advisory Board members do not receive
a fee for serving on the board, but are reimbursed for expenses
incurred.  Brian Loggie, MD is under a separate consultant
agreement with ViaCirq that has been approved by the University
of Texas Southwest to help expand the use of intraperitoneal
hyperthermia with the ThermoChem HT System.

     B. Loggie, M.D.               Surgical Oncology; University
                                   of Texas Southwestern
                                   Intraperitoneal hyperthermia focus

     S. Tomasovic, Ph.D.           Tumor Biology; UT/M.D. Anderson
                                   Cancer biology focus

     R. Fleming, Ph.D.             Pharmacology
                                   Hematology/oncology focus

     C. Steinhart, M.D., Ph.D.     Internal Medicine;
                                   Immunology; Mercy Hospital
                                   HIV Specialty


In March 1999, ViaCirq entered into a license agreement with Wake
Forest University in which ViaCirq licensed all proprietary
developments, data and information owned by Wake Forest relating
to a method of heated perfusion of chemotherapy drug in treatment
of intraperitoneal and other cancers.

In April 1999, a study was completed at Wake Forest University
School of Medicine utilizing the ThermoChem HT System for
intraperitoneal hyperthermia in combination with surgery and
chemotherapy in patients with advanced ovarian and
gastrointestinal cancer.

In January 2000, HemoCleanse and ViaCirq received FDA clearance
to market the ThermoChem HT System and related disposables, which
are used to raise the core temperature of the abdominal cavity to
the desired temperature in the 41 C (105.8 F) to 42 C (107.6 F)
range by continuously bathing the abdominal cavity with
circulating sterile solution.

In June 2000, ViaCirq amended its license agreement with
HemoCleanse whereby HemoCleanse granted ViaCirq a limited,
exclusive worldwide, fully-paid, irrevocable, perpetual license
limited to the relevant field of use in hyperthermia to
manufacture the ThermoChem SB and SB treatment kits.  All patents
and patent applications in whole body hyperthermia owned by
HemoCleanse were assigned to ViaCirq, the consideration for the
above was 1,042,253 shares of HemoCleanse common stock.  Since
1994, we invested $ 2,460,065 in HemoCleanse stock.  Of the
$2,460,065 invested in HemoCleanse common stock, approximately
$1,018,750 was invested in 1994; $1,310,822 in 1995; and $130,493
in 1998.  These investments were considered speculative
throughout the term of the investment because HemoCleanse was
continually operating at a deficit due to its research and
development activities.  Throughout those periods, HemoCleanse
incurred net losses, accumulated deficiencies in assets, and not
net tangible assets.  Our management considered all HemoCleanse
funding to be research and development expenditures and did not
recognize any goodwill due to the absence of a proven technology.
Due to HemoCleanse's financial condition and the absence of a
fair market value for the HemoCleanse common stock, all amounts
invested in HemoCleanse were expensed when the investments were
made.

In August 2000, ViaCirq entered into a 3-year agreement with
North Carolina Baptist Hospitals to provide our ThermoChem HT
System and disposables to Wake Forest University Baptist Medical
Center.  In November 2000, ViaCirq entered into a contract to
provide our ThermoChem HT System and disposables to Zale Lipshy
University Hospital at Southwest Medical Center.

In 2001, ViaCirq entered into entered into long-term use
agreements to provide our ThermoChem HT System to The University
of Pittsburgh Medical Center in Pittsburgh, PA; Baylor University
Medical Center in Dallas, TX; and Sharp Memorial Hospital in San
Diego, CA to use the ThermoChem HT System to administer
intraperitoneal hyperthermia as part of their surgical oncology
program.  We've spent approximately $18.7 on this project through
December 31, 2001.  We have been funding this project since 1992
with money we raised selling our securities, including our stock
or convertible debentures.

               Rapid HIV Detection Corp.'s HIV Test Project

     In 2001, we formed Rapid HIV Detection Corp. Rapid HIV
Detection Corp. was formed to market rapid HIV tests. Those rapid
HIV tests include:

                InstantScreen, which is the initial test for HIV;

                InstantConfirm, which is used to verify all positive
                 results; and

                InstantDifferentiate, which indicates whether the patient
                has HIV-1 or HIV-2.  HIV-1 is the most common form of HIV;
                HIV-2 is a less aggressive form found in some parts of the
                world, including West Africa.

The InstantScreen test takes 30 seconds to produce results.
Only a few drops of blood are needed, and the blood is drawn with
a finger prick, rather than intravenously with a needle and vial
of blood.  No additional material or special knowledge is needed
to administer the test, and only elementary level reading skills
are required.  The test can be produced in different formats,
depending upon whether it will be used in a doctor's office,
hospital or in the field.

The InstantConfirm test takes about 8 minutes to perform and
is the first rapid HIV test to use the Western-Blot type HIV
confirmation technology.  The Western-Blot is recognized as the
gold standard of HIV confirmation. This phase of the test is
critical, since false-positive results have been a significant
historical problem with HIV testing.

The InstantDifferentiate is used if the patient tests
positive for HIV, in order to determine whether the patient is
infected with HIV-1 or HIV-2.  HIV-2 is a less aggressive form of
HIV that causes AIDs after a longer period of time than HIV-1,
and is prevalent in certain parts of the world, including West
Africa.

In order to acquire the exclusive, world-wide marketing
rights to the rapid HIV tests, we entered into a marketing
agreement with GAIFAR, a German company which owned all the
rights to the tests, and Dr. Heinrich Repke, the man who
developed the tests.  The marketing rights were assigned to Rapid
HIV Detection Corp - we own 75% and GAIFAR owns 25% of Rapid
HIV's common stock.  GAIFAR retained the manufacturing rights for
the tests.   We entered into the agreement in June 2001 and
acquired the marketing rights at that time.  The initial terms of
the agreement allowed us a due diligence period of 8 weeks to
withdraw from the agreement, but in July, all the parties agreed
to extend that date until October 15, 2001.  The parties also
agreed that we would need to provide a copy of a resolution
signed by our board of directors approving the contract.  In
October, we completed our due diligence period and our board
provided their unanimous resolution, making the marketing
agreement fully effective, which means that we no longer have a
right to withdraw.   The marketing agreement, which we filed as
an exhibit to a Form 8-K filed October 15, 2001, has a minimum
ten-year term and calls for total payments of $7,000,000 through
the 3rd quarter of 2002.  When the marketing agreement became
effective in October 2001, all funds previously loaned, which
totaled $1,025,000 were applied to the total $7 million
consideration.  The remaining $5,975,000 in payments are due from
October 20, 2001 through August 20, 2002.  The payments include a
range of $125,000 per month for the 3 months from October-
December 2001 to $1 million per month for the 4 months from April
- July of 2002.   The original marketing agreement provided for
payments through the 2nd quarter of 2002, and we renegotiated for
a longer payment period in October 2001.

Beginning in December 2001, we did not make payments on  the
marketing  agreement when they were due because of our cash  flow
problems.   In  March 2002, GAIFAR and Dr. Repke gave  us  notice
that  we  needed  to  make  up the late payments  or  they  would
terminate  rights under the marketing agreement.  We  believe  we
have  until  May  2002 to catch up on the payments  in  order  to
maintain our marketing rights.

Our management entered into the Marketing Agreement and
invested the money because they believe that the tests are
superior, and that we would be able to sell them to generate
revenue. The tests are priced according to the quantities
purchased and the purchaser's intended use.  For example,
InstantScreen tests are priced at $5 or less - we have charged a
research facility, like Walter Reed, less than $5, and charged
commercial users closer to $5, depending upon the quantity.  The
InstantConfirm and InstantDifferentiate tests will probably be
sold together, and we plan to charge between $12-15 for that
package.

Based on studies conducted by various health institutions,
which are summarized in the next two bullet points, our
management believes investing in Rapid HIV is in the best
interest of our company:

          In approximately 200 tests performed by the Noguchi Memorial
          Institute for Medical Research in Ghana, as well as 250 samples
          in an evaluation by the World Health Organization, and 150
          samples evaluated by the National Institute for Virology in South
          Africa, our rapid HIV test performed with 100% accuracy.

          Walter Reed Army Institute of Research completed its own
          evaluation of the our rapid HIV test - in nearly 600 samples, our
          rapid HIV test showed perfect results - 100% sensitivity and 100%
          specificity.

Our management also believes that investing in Rapid HIV was a
good use of our company's funds because they believe that our
rapid HIV tests are superior overall to other available tests,
including Determine, Oraquick and Medmira:

          One significant problem with other tests is that they have
          not performed as well in the field as they have in a laboratory.
          Our Rapid HIV tests can be used anywhere.  This enables us to
          take the tests directly to the people who need it, rather than
          trying to convince them to travel distances to laboratories or
          hospitals.

          Another significant problem with HIV testing on a massive
          scale is time - only a rapid HIV test will work.  The speed of
          our tests allows each patient to receive results immediately,
          without leaving the test site.  Tests that require the patient to
          leave samples and return for them later not only jeopardize
          confidentiality - but those tests are also susceptible to an
          alarming but common occurrence - patients who never return for
          their test results.

          Our test does not require refrigeration and contains
          compounds that destroy the HIV cells and other infectious cells
          contained in test sample.  Those cells are destroyed by one of
          the chemical agents included in the test solution for that
          purpose - those chemical agents can only destroy the cells in the
          test sample, and cannot help to cure HIV.  This means our tests
          can be discarded without further sterilization or the need for
          toxic waste treatment.

          The result of our test can be permanently attached to the
          patients' file, allowing the patient to provide his HIV status at
          any time.

          Our tests are affordable - we plan to charge $5 or less in
          most instances for the InstantScreen test.

Although our initial focus is marketing our rapid HIV tests
outside the United States, we are also pursuing FDA approval to
sell the test in the U.S.  GAIFAR and Dr. Repke began the FDA
process in November 2000 and we are currently working with GAIFAR
to design the trials needed for a full submission.  Our past
experience with the FDA indicates that it will not be a quick or
easy process. We began trying to obtain FDA approval for our
noninvasive glucose sensor in 1994, and we still don't have FDA
approval.  We've conducted several sets of clinical trials in our
effort to obtain FDA approval for our noninvasive glucose sensor,
and the trials we began in October 2000 are continuing.  We have
not received any revenue from our noninvasive glucose sensor
since 1999.

    Biocontrol Technology's Research & Manufacturing Projects

In 2001, our Biocontrol Technology division increased its efforts
to obtain research and manufacturing contracts to utilize our
manufacturing facility in Indiana, PA, while we are waiting for
the clinical trials on the Diasensor to proceed.  The division
received a $1.5 million manufacturing contract from the U.S.
Army, and  $238,000 research contract from a private company.  We
believe the U.S. Army contract will generate $1.5 million in
revenue during the first year, beginning in the 4th quarter of
2001, with additional revenue for two additional years.


          Diasense's Noninvasive Glucose Sensor Project

CURRENT STATUS OF THE NONIVASIVE GLUCOSE SENSOR

In March 2002, we decided to suspend the clinical trials for our
Diasensor 2000 for several reasons. First of all, we've made
better progress on the development of our Diasensor 3000, the
next generation of our noninvasive glucose sensor, and as soon as
it is completed, we plan to conduct a new clinical trial for the
better Diasensor. As long as we can continue to fund more
development, we hope to finish the Diasensor 3000 this year.  The
Diasensor 3000 is better than the 2000 because:

          It can be calibrated to the patient in a few days rather
          than 6-8 weeks;

          It is quicker and easier - thus less expensive to
          manufacture.  It takes days to manufacture the 2000, and hours to
          manufacture the 3000;

          It is smaller than the 2000; and

          It should cost the patient much less - probably about half
          as much as the 2000.

Although we are not permitted to discuss the results of the
clinical trials, the data we gathered was encouraging and helped
us develop the Diasensor 3000. Another reason we decided to
suspend the trials was that we believe that, by using the
Diasensor 3000, we can use a different type of trial - one that
is quicker and less expensive, to satisfy the FDA.

Finally, our cash flow problems made it almost impossible to
continue and complete the Diasensor 2000 trials.  The trials took
much longer and were much more expensive than we planned, and we
didn't have enough money to keep them going at full scale.  Some
sites had already discontinued their trials because we couldn't
keep their payments current.  You should read our Managements'
Discussion and Analysis section for more information on our cash
flow problems.

We don't know how much longer the FDA approval process will take.
Although suspending the trials will delay FDA approval, we
believe that the Diasensor 3000 is a better device and we hope
that the FDA approval process for the 3000 will be shorter and
less expensive than the 2000.

Although we discontinued our Diasensor 2000 trials, the following
paragraphs tell you about how they did operate during 1999-2001.

In August 1999, we hired Joslin Diabetes Center to help us with
our FDA submission.  Joslin Diabetes Center designed and
conducted the clinical trials on the Diasensor 2000.

Our contract with Joslin called for Joslin's representatives to
conduct a clinical study on the effectiveness of the Diasensor
2000. The FDA approved Joslin's protocol for the clinical study
in August 2000.  In the Joslin contract, we agreed to pay for the
study, and Joslin agreed to provide us with a report on the data
gathered.  Joslin also has the right, subject to confidentiality
provisions, to publish the results of the clinical trials.  The
Joslin contract requires us to pay fees for their services.

In February 1999 we submitted a PMA shell to the FDA for the
Diasensor.  The PMA shell is part of a revised FDA procedure,
which divides submissions into modules, or parts.  These modules,
which were designed to facilitate and expedite FDA review,
contain different pieces of the full PMA submission.  However,
from both our own experience and by observing other module
submissions, we do not believe that the FDA intends to "approve"
the PMA one module at a time.  Rather, we have had meetings with
the FDA, including the October 1999 meeting, where requirements
for the "next step" in the process have been discussed without a
specific FDA finding on prior submissions.

In May 1999, we submitted the first module, which covered
manufacturing methods and procedures for the Diasensor 2000.  The
FDA asked for additional information in September 1999, and we
responded.  We filed the second module in May 2000.  The second
module contained information regarding electrical and mechanical
standards for the FDA's requirements on safety and effectiveness,
and a description of how our noninvasive glucose sensor will be
used by patients.  Future modules will include raw data and
laboratory study methods and test results. We'll make the final
PMA submission when our clinical trials are completed, and that
submission will include human clinical results and a summary of
safety and effectiveness data.

Clinical trials began in October 2000 at Joslin Diabetes Center
in Boston.  The trials were designed for a total of 200
diabetics. Trials were also conducted at eight other sites: St.
Luke's-Roosevelt Hospital Center in New York City; SUNY Health
Science Center in Syracuse, New York; Hershey Medical Center in
Hershey, Pennsylvania; Dr. David Huffman in Chattanooga,
Tennessee; New Britain General Hospital in New Britain,
Connecticut; Tulane Medical Center in New Orleans, Louisiana; and
University of North Carolina in Chapel Hill, North Carolina; and
the University of Maryland in Baltimore, Maryland.

Although our research and development team continues to have
discussions with the FDA, due to the complex, technical nature of
the information being evaluated by the FDA, it is impossible for
us to estimate how much longer the FDA approval process will
take.

FDA approval is necessary to market the Diasensor in the United
States.  In 1999, we also focused additional effort on the
European market; since no material sales have occurred, we've
discontinued our European marketing efforts.

Based  on  contracts  between BICO and  Diasense,  BICO  has  the
exclusive  right  to manufacture the noninvasive glucose  sensor.
Diasense  will  pay BICO for manufacturing, and that's  how  BICO
will  make  money  if we ever successfully market  and  sell  the
noninvasive glucose sensor.

Diasense is responsible for the marketing and sales of the
noninvasive glucose sensor.  Diasense plans to market the
noninvasive glucose sensor and the telemedicine program directly
to diabetics, through their doctors' orders.  We may set our
prices too high, which will limit our sales, unless we can
convince health insurance companies to pay for them.  Because the
health insurance industry is in a constant state of change, we
can't predict whether - when - or if - we will convince them to
pay for our noninvasive glucose sensor or the telemedicine
program.  We have estimated, based on information from the
American Diabetes Association, that there are about 15.7 million
diabetics in the United States, but not all diabetics will be
suitable users of our noninvasive glucose sensor. Those diabetics
who require and benefit from frequent glucose monitoring and
whose physicians adjust their insulin dosages based on glucose
averages over time make up the potential market for our sensor,
and we can't accurately estimate the size of that market at this
time.

    HISTORY AND DEVELOPMENT OF THE NONINVASIVE GLUCOSE SENSOR

Along with Diasense, we've been working to develop a noninvasive
glucose sensor for diabetics that is able to measure glucose
without having to draw blood.  Most currently available glucose
monitors require the drawing of blood by means of a finger prick.

Our initial research and development with insulin pumps led to a
theory by which blood glucose levels could be detected
noninvasively by correlating points on the infrared spectrum that
are reflected by electromagnetic energy through the skin.  We
studied this method in 1986 and 1987 using laboratory instruments
and working with consultants at Battelle Memorial Institute in
Columbus, Ohio.  The results of the studies provided information
regarding the use of infrared light in the noninvasive
measurement of glucose.  The information from the studies, along
with later additional work, led to a patent application by our
research team in 1990.  A patent covering the method was granted
to our research team and assigned to Diasense in December 1991.
Diasense purchased those patent rights from us under a purchase
agreement.  We filed a second patent application in December
1992, which was granted in January 1995.  That second filing
contained new claims, which extended the coverage of the patent
based on additional discoveries and data obtained since the
original patent was filed.  We assigned the rights to that patent
to Diasense.   We developed additional concepts to improve the
capability of the instrument to recognize blood glucose, and, in
May 1993, filed corresponding patent applications.  As of
November 2001, a total of 14 U.S. patents and two foreign patents
have been issued, with additional patent applications pending.
We have the right to develop and manufacture sensors based on
contracts with us.

Our research team advanced this technology base through the
development of several research prototypes, which were tested in
human clinical trials.  We conducted a trial on 110 human
subjects in March 1992.  In that trial, we recorded spectral,
blood and chemical data for analysis in order to develop
calibration data for the noninvasive glucose sensor.  We
conducted a second trial on 40 human subjects in July 1992 that
indicated that the device did not have a satisfactory signal-to-
noise ratio to allow for sufficient accuracy to be acceptable for
patient use.  Signal-to-noise ratio is determined by the
relationship of the signal, which is the glucose level, and the
noise, which are the random interferences, such as differences in
skin surfaces.  We conducted other trials at several testing
sites under the guidance of the sites' Institutional Review Board
using prototypes, which addressed the signal -to-noise problem.
We designed and constructed those prototypes to simulate
production models.

On January 6, 1994, we submitted the initial 510(k) Notification
to the Food and Drug Administration for approval to market the
production model, the Diasensorr1000.  A 510(k) Notification is a
type of FDA filing used to ask the FDA to approve a device for
sale in the U.S.  We based the submission on data obtained from
the advanced research prototypes, since we believed that the
production model would be identical to the advanced prototypes.
In February 1996, the FDA convened a panel of advisors to make a
recommendation regarding our 510(k) Notification.  The majority
of the panel members recommended that we conduct additional
testing and clinical trials of a production model prior to
marketing the Diasensor 1000.  We, along with Diasense, announced
that we would remain committed to bringing the Diasensor 1000 to
diabetics, and that additional research, development and testing
would continue.

Due to continued delays in the FDA approval process, and while
continuing to work with the FDA and conduct its mandated testing,
we turned our focus to other markets for the Diasensor 1000
besides the U.S.

In 1998, we were awarded International Organization for
Standardization certification by TUV Rheinland, a German company
authorized to conduct such audits, which was contracted to
perform an audit of our quality system.  We were awarded ISO
Certification to the 9001 standard, which is evidence that we
have, in place, a total quality system for the design,
development and manufacture of our products.  We were also
awarded EN46001 Certification, indicating we meet European
standards for medical devices.  Once the ISO 9001 certification
was approved, and a technical file was submitted and approved by
TUV Rheinland, we received approval to apply a CE mark to the
device. Much like an Underwriters Laboratory "UL" mark, the CE
mark is provided by the regulatory bodies of the European
Community, or by authorized private bodies, such as TUV
Rheinland, to indicate that the device adheres to "quality
systems" of the ISO and the European Committee for
Standardization.  The CE mark permits us to sell the Diasensor in
Europe, although we have discontinued our marketing efforts in
Europe.

With regard to marketing the device within the United States, we
continued to work with the FDA to obtain approval.  After
discussions with the FDA, we submitted a revised 510(k)
Notification in October 1996, which was followed by continued
discussions with the FDA.  During 1997 and 1998, we continued to
meet with the FDA, and established a protocol for in-home testing
of the Diasensor 1000.  Due to our cash flow problems during
1998, testing did not proceed at the pace originally anticipated,
and completion of the testing was delayed.

We continued various aspects of the Diasensor development, which
resulted in a method that will allow the patient to transmit the
readings generated by the noninvasive glucose sensor to the
patient's clinic or physician.  Following an in-depth marketing
study, we determined that the machines with this capability are
more attractive to the patient, since there is the possibility of
selling a telemedicine service which includes the machine, the
patient, and his or her physician.  This model of the Diasensor
has been named the Diasensor 2000 to differentiate between the
earlier models.  Based on advice from the FDA, we decided it was
in our best interest to submit a PreMarket Approval Application
to the FDA, rather than continue with the 510(k) Notification
process, in order to seek FDA approval for the Diasensor 2000.
In 1999 the FDA implemented a new PMA system. Under the new
system, individual modules - or parts - of a PMA submission could
be made as they were ready.   We discuss our PMA submissions in
the "Current Status of the Noninvasive Glucose Sensor" section,
which follows.

The Diasensor is a spectrophotometer, which is a machine capable
of illuminating a small area of skin on a patient's arm with
infrared light, and then making measurements from the infrared
light that is reflected back into the device.  The device then
displays the measurement in a window on the top of the device for
the user to read.  The Diasensor uses internal mathematical
calculations and customized software to calculate a glucose
measurement.

Since the Diasensor will be calibrated individually, each
instrument will be sold in the U.S. by prescription only and will
be calibrated in the patient's home.  This feature may limit the
marketability of the Diasensor, and if the device is unable to
qualify for third-party reimbursement - which means if the health
insurance companies won't pay for it -we will have a hard time
marketing and selling the device.




                         Other Projects

Implantable Technology

In April 1996, we received FDA approval to market our theraPORTr
Vascular Access System. The approval was granted in response to
our 510(k) Notification filed in January 1996.  The device is
made up of a reservoir, which is implanted beneath the skin in
the chest region with a catheter inserted in a vein and provides
a delivery system for patients who require continual injections.
Because such repeated injections can cause veins to shut down and
collapse, the theraPORTr offers an improved delivery system by
eliminating that trauma.  If necessary to accommodate multiple
drug therapy with incompatible drugs, dual ports can be
implanted.  Such devices are frequently used in cancer drug
therapy. We began selling the standard ports during the second
quarter of 1997.  A second device with a low profile was
developed for pediatric use, and a 510(k) was submitted to the
FDA in November 1997 for marketing approval.  In early February
1998, we submitted a supplement to the FDA in response to a
request for additional information, and the FDA granted its
approval that same month.  We are currently developing a dual
port device and plan to submit another 510(k) for that device;
however, our biomedical efforts continue to be focused on the
Diasensor, so it is impossible for us to estimate when that
submission might occur.

Through our subsidiary, Coraflex Inc., we are engaged in the
development of a polyurethane heart valve, which we believe may
not have the disadvantages of the mechanical and other synthetic
valves currently being marketed.  The Coraflexr valve, which
resembles the human heart's aortic valve, is made by means of a
proprietary manufacturing process.  We believe that the
polyurethane we use to make our heart valve is stronger and more
resistant to fatigue compared to other valves.  In vitro testing,
some of which has been performed through the Children's Hospital
of Pittsburgh, of the Coraflexr valve to date has demonstrated
that our valve has superior fatigue resistance and flow
characteristics compared to other devices.  We must conduct
additional development and testing before we can submit our valve
to the FDA to begin testing it on humans.  We'll need additional
funding to do that, and we don't know when, or if, and FDA
submission or testing will occur.

We also developed technology for other implantable devices, such
as hemodialysis ports, implantable insulin dispensers and
rate-adaptive pacemakers.   Because we decided to focus most of
our resources on the noninvasive glucose sensor, we haven't made
any real progress on these other projects, so they are all in
very preliminary stages of development.

Diabecore Medical, Inc.

During fiscal 2000 and 2001, through Diasense, we invested in
Diabecore Medical, Inc., a Canadian company that is conducting
research and working with other research institutions to develop
a new type of insulin to treat diabetes. In preliminary studies,
this new insulin has demonstrated effectiveness in controlling
hyperglycemia without risk of severe hypoglycemia.  Laboratory
tests indicate that this new insulin, when administered in large
doses, extends the duration of insulin action for improved
control of glucose levels, rather than producing hypoglycemia.
Those tests also have shown the new insulin to be 3 to 4 times
less hypoglycemic when compared to presently available insulin.
William D. Lougheed and Kusiel Perlman, M.D. are developing
Diabecore's insulin with the support of the Research Institute of
the Hospital for Sick Children in Toronto, where insulin was
discovered, and the Loyal True Blue and Orange Research Institute
in Richmond Hill, Ontario.  We have invested a total of
approximately $987,500 in Diabecore, and Diasense owns
approximately 24% of Diabecore's stock.  We currently have no
plans to make additional investments in Diabecore.

MicroIslet, Inc.

During fiscal 2000 and 2001, through Diasense, we also invested
in MicroIslet, Inc.  MicroIslet is a California company that is
developing several diabetes research technologies with Duke
University that focus on optimizing microencapsulated islets for
transplantation.  The current research involves the use of
microencapsulated pancreatic cells, which are transplanted into
diabetic animals.  The initial trial on a non-human primate
continues to provide very encouraging results.  The diabetic
animal achieved and maintained normal glucose readings for over
one year following the transplant.  MicroIslet believes that
there are several benefits to using the microencapsulated islets
for transplants, rather than transplanting human pancreatic
cells.  One benefit is the supply; the only source of human cells
is from deceased organ donors, and more than one donor is needed
for each transplant.  In addition, human transplants involve a
serious course of immuno-suppression therapy so the human
recipient does not reject the transplanted cells.  Dr. Emmanuel
Opara, Ph.D. is the director of islet transplantation research at
Duke University Medical Center, and he is heading up the research
team.  Dr. Opara's team is replicating the testing on 3 more
primates to obtain additional data to support a planned request
to the FDA to conduct human trials.  We have invested a total of
approximately $1.6 million in MicroIslet and Diasense owns
approximately 20.2% of MicroIslet's stock.  We currently have no
plans to make additional investments in MicroIslet.

Metal Plating and Coating Technology

CCTI, which stands for Ceramic Coatings Technologies, Inc., is a
Florida company that developed a ceramic coating used for metal
components.  CCTI then developed a product line for sharpeners
used for knives and other tools in the professional culinary
field, for sportsmen's knives and fish hooks, for professional
woodworkers and for household use.  Although we've begun to
receive revenues from CCTI, which aggregated approximately
$112,091 for 2001, we have decided to sell CCTI and are in active
negotiations with a buyer.

In March 1998, we acquired an interest in a metal-plating
company, because we estimated that the product would generate
revenue and profit.  We were wrong - the actual results were very
different from our original estimates.  The project did not
generate any revenue during 1998 or 1999.  Our early estimates
were based upon our assessment not only of the marketability of
the product, but on our ability to penetrate the metal finishing
market using the features of the product. Our actual experience
shows that it is much more difficult to exploit the existing
market, regardless of whether or not the product has superior
features.  As a result, we discontinued operations and made the
appropriate adjustments to our financial statements to reduce the
value of this investment, which totaled $4.6 million - we funded
that investment through sales of our securities including our
debentures.   In 2001, we reached an agreement with the people
who sold us the interest  - we still owed them money from the
purchase.  They agreed to restructure the total $5,450,348 due to
them and to reduce the amount to $2,887,500.  As of December 31,
2001, we had made payments totaling $387,500, and issued them $2
million of our series I convertible preferred stock.

Internet Business Services

We made investments in a company called B-A-Champ.com.  That
company evolved from an internet card-trading company to an
internet business service provider and became TruePoints, Inc.
TruePoints provides internet marketing retention and promotional
services for businesses.  You should visit TruePoints website at
www.truepoints.com to see how TruePoints operates and the type of
promotional and customer retention programs they provide.  Fred
Cooper, our CEO, owned stock in B-A-Champ but during 2001, he
gave that stock to BICO.  As of December 31, 2001, we had
invested a total of $1,445,000 in the project since the beginning
of 2000.

American Inter-Metallics

During 1999, we made our initial investment in American Inter-
Metallics, Inc.  AIM has its operations in Rhode Island, and is
developing a product that enhances the performance of
propellants.  AIM is developing specialized equipment and a
process for producing a product, which AIM believes will increase
the burn rates of current propellant formulas.  AIM believes
that, by increasing the burn rate of propellants, its product
will improve the performance of rockets and other machinery.
During 2000, AIM completed its prototype and is now testing the
equipment.  We invested $525,000 in AIM during 1999, and made
additional investments of $285,000 during 2000 and $190,000 in
2001 for a total investment of $1 million, or 20% of AIM.
AIM's product is in the research and development phase; we can't
give any assurances that it will be successful or profitable.

All this information regarding our projects is in summary form,
and the status of each project is subject to constant change.  We
can't assure that any of our projects will be completed or
successful.

RESEARCH AND DEVELOPMENT

We continue to be actively engaged in the research and
development of new products.  Our major emphasis has been the
development of a noninvasive glucose sensor.  In order to raise
funds for the research and development of new products, we sell
our stock and convertible securities.

MARKETING AND DISTRIBUTION

Petrol Rem began marketing of its bioremediation product, PRP,
in mid-1993, and is now sold in quality marine supply stores in
the coastal areas of the United States, Canada, Europe and South
East Asia.

ViaCirq received FDA approval to market its ThermoChem-HT System
and related disposables used for regional cancer treatment.

None of our current projects have generated any meaningful sales
or revenue, although INTCO is generating revenue by providing
environmental clean-up services by using our PRP products, and
Petrol Rem's sales are increasing.

PATENTS, TRADEMARKS AND LICENSES

We own patents on certain products and we file applications to
obtain patents on new inventions when practical.  Additionally,
we try to obtain licenses from others when we think it's
necessary to conduct our business.

We rely on trade secret protection for our confidential and
proprietary information.  Although we and our affiliates,
Diasense, ViaCirq and Petrol Rem, take all reasonable steps to
protect such information, including the use of confidentiality
agreements and similar provisions, we can't assure that others
will not independently develop substantially equivalent
proprietary information or techniques, otherwise gain access to
our trade secrets, disclose such technology, or we can
meaningfully protect its trade secrets.

Bioremediation

In 1992 and 1993, Petrol Rem applied for patents in connection
with its bioremediation product, all of which are still pending.
Petrol Rem received trademark authorization for the use of the
product names PRP, BIO-SOK, BIO-BOOM, and Oil Buster.

In 2001, Petrol Rem filed a new patent application regarding PRP
and its manufacture without the addition of microorganisms.  The
patent is currently pending.

Extracorporeal Hyperthermia

In September 1992, a research team funded by us applied for a
domestic patent in connection with the use of perfusion-induced
systemic extracorporeal hyperthermia and the treatment of HIV-
positive patients; the patent has been assigned to ViaCirq.  In
October 1994, ViaCirq received notification that the patent
application for its specialized method for whole-body hypothermia
has been issued.

The patent entitled "Specialized Perfusion for Whole-Body
Hyperthermia" contains seventeen claims for the hyperthermia
procedure, including the method of heating all of the blood in
the extracorporeal blood circuit to raise the patient's core
temperature to approximately 42 C.  A continuation in part, which
was filed by ViaCirq and included the ThermoChem System was
allowed in July 1995 and was issued in December 1995.

In May 1999 and early 2000, ViaCirq filed provisional patents for
its use of the ThermoChem HT System and related disposables, and
for use of the device for regional hyperthermia procedures.

In June 2000, HemoCleanse assigned all patents and patent
applications to ViaCirq relating to the ThermoChem technology in
hyperthermia.  One of those patents was issued in December 2000,
and another was allowed in January 2001.

In January 2000, HemoCleanse and ViaCirq received FDA approval to
market the ThermoChem HT System and related disposables, which
are used to raise the core temperature of the abdominal cavity to
the desired temperature in the 41C (105.8 F) to 42 C (107.6 F)
range by continuously bathing the abdominal cavity with
circulating sterile solution.  In addition, in February 2000, the
FDA approved continued clinical trials at the University of Texas
Medical Branch using the ThermoChem technology in whole-body
hyperthermia to treat patients with certain types of end-stage
lung cancer, which was completed in 2001.

Rapid HIV

Dr. Repke and GAIFAR, who developed the tests, own the patent
rights for the Rapid HIV test technology.  From an intellectual
property viewpoint, there are two parts of the Rapid HIV
technology.  The first is on the detection system and the second
is on the chemical composition of the tests themselves.  So far,
Dr. Repke and GAIFAR have treated the detection system as a trade
secret, and they have not filed any patent applications for it.
In December 2001, Dr. Repke and GAIFAR received notice that the
German patent had been allowed for the chemical composition of
the InstantScreen test.  U.S., European and Patent Cooperative
Treaty - PCT - applications are already in process.

Noninvasive Glucose Sensor

Diasense owns a patent entitled "Non-Invasive Determination of
Glucose Concentration in Body of Patients" which covers certain
aspects of a process for measuring blood glucose levels
noninvasively. That patent was awarded to BICO's research team in
December 1991 and was sold to Diasense under a purchase agreement
dated November 18, 1991.  The patent will expire, if all
maintenance fees are paid, no earlier than the year 2008.  If
clinical testing or regulatory review delays marketing of a
product made under the patent, we may be able to obtain an
extension of the term of the patent.  Our patent relates only to
noninvasive sensing of glucose but not to other blood
constituents.  We have filed corresponding patent applications in
a number of foreign countries.

As of November 2001, a total of 14 U.S. and two foreign patents
have been issued, all of which have been assigned to Diasense,
and additional patents are pending.    Corresponding patent
applications have been filed in foreign countries where we
anticipate marketing the noninvasive glucose sensor.

Our research team continues to file patent applications,
provisional patent applications, some of which are being
converted into PCTs - Patent Cooperative Treaty - that reflect
the continued research and development and additional refinements
to the noninvasive glucose sensor.

We or Diasense may file applications in the United States and
other countries, as appropriate, for additional patents directed
to other features of the noninvasive glucose sensor and related
processes.

We know that competitors currently developing non-invasive
glucose sensors own patents directed to various devices and
processes related to the non-invasive monitoring of
concentrations of glucose and other blood constituents.  It is
possible that those patents may require us to alter any model of
the noninvasive glucose sensor or the underlying processes
relating to the noninvasive glucose sensor, to obtain licenses,
or to cease certain activities.

We also rely upon trade secret protection for our confidential
and proprietary information.  Although we, along with Diasense,
take all reasonable steps to protect such information, including
the use of confidentiality agreements and similar provisions,
there can be no assurance that others will not independently
develop substantially equivalent proprietary information or
techniques, otherwise gain access to the our trade secrets,
disclose such technology, or that we can meaningfully protect our
trade secrets.

We have registered our trademark "Diasensor ", which is intended
for use in connection with the Diasensor models. We intend to
apply, at the appropriate time, for registrations of other
trademarks as to any future products.

Implantable Technology

During 1995, we renewed our U.S. trademark registration for the
name Coraflexr, which was originally granted in 1988.  We also
obtained trademark registration for the name theraPORTr.

In October 1996, we obtained a patent for our heart valve
product.

WARRANTIES AND PRODUCT LIABILITY

Our current product liability insurance coverage is $1,000,000 in
the aggregate, and we believe that's sufficient due to our
discontinuance of sales of certain products, including our former
pacemaker line and our functional electrical stimulators, as well
as our potential exposure to liability.

SOURCE OF SUPPLY

In connection with the manufacture the noninvasive glucose sensor
and the ThermoChem System, we will be dependent upon suppliers
for some of the components required to manufacture the device.
We plan to assemble the devices, but will need to purchase
components, including some components that will be custom made
for us by certain suppliers.  These components will not be
generally available, and we may become dependent upon those
suppliers, which do provide such specialized products.

If we successfully develop other new products, and receive
regulatory approvals to manufacture such products, we may become
dependent on certain suppliers for custom parts.

COMPETITION

Bioremediation

Although our bioremediation products compete with other oil-spill
clean-up products, there is no direct competition for the type of
product we produce.   The EPA recently created a separate
category for its NCP listing, for enzyme additives, and PRP is
the only product listed in that category.

Noninvasive Glucose Sensor

With the rapid progress of medical technology, and in spite of
continuing research and development programs, our developmental
products are always subject to the risk of obsolescence if some
other company introduces a better product or technique.  We are
aware that other research groups have developed noninvasive
glucose sensors, and that others are still in the research &
development phase, but we have limited knowledge about the actual
technology or the stage of development for most of our
competitors.  We face the risk that some other group will
complete the development of their device and penetrate the market
before we do.   If that happens, there is a significant chance
that even if we receive FDA approval, our sensor will not be
successful because our marketing efforts started too late.  We
don't believe there is any other company currently producing or
marketing noninvasive sensors for the measurement of blood
glucose that use the same technology as we do.  Competitive
success in the medical device field is dependent upon product
characteristics including performance, reliability, and design
innovations.

Our noninvasive glucose sensor will compete with existing
invasive glucose sensors.  Although we believe that the features
of our noninvasive glucose sensor, particularly its convenience
and the fact that no blood samples are required, will compete
favorably with existing invasive glucose sensors, we can't assure
that it will succeed.  Most currently available invasive glucose
sensors yield accuracy levels of plus or minus 25% to 30%, range
in price from $80 to $200, not including monthly costs for
disposable supplies and accessories, and are produced and
marketed by eight to ten sizable companies.  Those companies
include Bayer, Inc., Boehringer Mannheim Diagnostics, and
Lifescan, an affiliate of Johnson & Johnson.    In addition,
Abbott Laboratories introduced a new test in 2001 that allows
diabetics to draw blood from areas other than their fingers, such
as from their arms.  Abbott's Sof-Tac test is part of their
MediSense product line.

Those companies have established marketing and sales forces, and
represent established entities in the industry.  Certain
competitors, including their corporate or joint venture partners
or affiliates, currently marketing invasive glucose sensors have
substantially greater financial, technical, marketing and other
resources and expertise than we do, and may have other
competitive advantages over us, based on any one or more
competitive factors such as accuracy, convenience, features,
price or brand loyalty.  Additionally, competitors marketing
existing invasive glucose sensors may from time to time improve
or refine their products, or otherwise make them more price
competitive, so as to enhance their marketing competitiveness
over our noninvasive glucose sensor.  As a result, we can't make
any guarantees that our sensor will be able to compete
successfully.

We face more direct competition from other companies who are
currently researching and developing noninvasive glucose sensors.
We have very limited knowledge as to the stage of development of
these other devices; however, if another company successfully
develops a noninvasive glucose sensor, obtains FDA approval, and
reaches the market before we do, we would suffer.

During 2001, Cygnus of Redwood, California received various FDA
approvals, including for assembly and manufacturing for its
GlucoWatch Biographer system that draws glucose through the skin
through an electric current.  The glucose triggers a reaction in
a disposable pad.  Although Cygnus claims that its device is
noninvasive, the fact remains that, in addition to the use of
electrical charges to draw fluid through the skin, each person
must use finger prick technology to set and use the device.  The
device is being sold in the U.K., and Cygnus plans to launch
their device in the U.S. in 2002.  We believe that the device
does not work for everyone, especially those who perspire, and
produces side effects including skin rashes that make regular use
difficult for some patients.  We were interested to learn that
the FDA panel accepted Cygnus' use of the same error grid data
analysis - a specific method for displaying data - which the FDA
rejected when we used it for our own panel review.  At this
point, we can't determine what effect, if any, the GlucoWatch
Biographer will have on our marketing or sales potential, because
we don't know how successful it will be.

Among the companies investigating infrared technology to measure
blood glucose levels noninvasively is CME Telemetrix in Waterloo,
Ontario, Canada.  CME is reportedly conducting tests with a
device called a GlucoNIR via funding from Motorola, Inc. that
uses one type of infrared wavelengths.  CME Telemetrix recently
reported that they were working to achieve acceptable accuracy
levels before beginning human trials.  OptiScan Biomedical in
Alameda, California is developing a device that uses another type
of infrared wavelengths; they are still in clinical trials and
have not yet made an FDA submission. Johnson & Johnson's LifeScan
division has an agreement with InLight Solutions, an Albuquerque
company working on a device that uses near-infrared light to
measure blood glucose.  In November 2001, Johnson & Johnson also
acquired diabetes technology from Inverness Medical Technology.
Inverness is selling an electro-chemical glucose meter and is
also in the test strip business.   Rio Grande Medical
Technologies of Albuquerque, New Mexico is designing a photo-
based device.  We believe Rio Grande is still being funded by
Johnson & Johnson.

Other companies claim that they are designing systems that are
semi-invasive.  SpectRx in Norcross, Georgia is using a laser to
create small holes in the skin without the invasive penetration
of a metal needle or lancet.  SpectRx is also using the device to
do optical scans.   The device, called the Accu-Chek D-Tector,
then gives a glucose reading from the fluid collected from the
holes in the skin. SpectRx has partnered with Roche Diagnostics.
In addition, SpectRx recently received additional funding from
Abbott Laboratories and a third grant from the U.S. Centers for
Disease Control to focus on research to use the device for
children and the elderly.  Last year, SpectRx reported that they
had received expedited review status from the FDA for a three-
module premarket approval filing for their diabetes detection
device; and that clinical trials are underway. Cell Robotics
International, Inc. in Albuquerque, New Mexico is also using a
laser device that pierces the skin.  Called the Lasette, a laser
makes a small hole in the fingertip to draw blood for glucose
testing.  A continuous glucose monitoring system from MiniMed,
Inc. in Sylmar, California received FDA approval in June 1999.
The device includes a tube with a small sensor at its tip that is
inserted through the skin, sending readings via a small wire to a
sensor.  A new sensor must be reinserted under the skin every two
to three days.  In November 2000, MiniMed also announced that it
had started human clinical trials of a long-term implantable
glucose sensor developed by a company called MRG.  In August
2001, Medtronic bought MiniMed and changed its name to Medtronic
MiniMed.

Certain organizations are also researching and developing
technologies that may regulate the use or production of insulin
or otherwise affect or cure the underlying causes of diabetes.
We are not aware of any new or anticipated technology that would
effectively render our noninvasive glucose sensor obsolete or
otherwise not marketable.  However, future technological
developments or products could make our noninvasive glucose
sensor significantly less competitive or, in the case of the
discovery of a cure for diabetes, even obsolete.

GOVERNMENT REGULATIONS

Since most of our products are medical devices as defined by the
Federal Food, Drug and Cosmetic Act, as amended, they are subject
to the regulatory authority of the FDA.  The FDA regulates the
testing, marketing and registration of new medical devices, in
addition to regulating manufacturing practices, labeling and
record keeping procedures.  The FDA can inspect our facilities
and operations and may also audit our record keeping procedures
at any time.  The FDA's Quality System Regulation specifies
various requirements for our manufacturing processes and the way
we must maintain certain records.

In 1997, Congress passed legislation that addresses the
regulation of pharmaceutical and medical devices.  Although the
impact of the FDA Administration Modernization Act of 1997 was
expected to reduce the quantity of information a company must
submit for approval of devices that has not been our experience.

Bioremediation

The EPA and the Pennsylvania Department of Environmental
Resources regulate our bioremediation products.  In addition,
each state in which the bioremediation products are used has its
own environmental regulations.  Regional response teams
consisting of representatives from the National Oceanic and
Atmospheric Administration, the U.S. Coast Guard and the EPA
govern our oil spill clean-up products.

Extracorporeal Hyperthermia

In January 2000, HemoCleanse and ViaCirq received FDA approval to
market the ThermoChemT-HT System and related disposables, which
are used to raise the core temperature of the abdominal cavity to
the desired temperature in the 41 C (105.8 F) to 42 C (107.6 F)
range by continuously bathing the abdominal cavity with
circulating sterile solution.  In addition, in February 2000, the
FDA approved continued clinical trials at the University of Texas
Medical Branch using the ThermoChem technology in whole-body
hyperthermia to treat patients with certain types of end-stage
lung cancer.

Rapid HIV

Although our initial marketing efforts with our Rapid HIV
products are focused on international markets, GAIFAR and Dr.
Repke have begun the process to obtain FDA approval.  At this
time, we cannot estimate how long or how expensive that process
might be.

Noninvasive Glucose Sensor

Since our noninvasive glucose sensor is a medical device as
defined by the Federal Food, Drug and Cosmetic Act, as amended,
it is subject to the regulatory authority of the FDA.  The FDA
regulates the testing, marketing and registration of new medical
devices, in addition to regulating manufacturing practices,
labeling and record keeping procedures.  The FDA can inspect our
facilities and operations and may also audit our record keeping
procedures at any time.  The FDA's Quality System Regulation
specifies various requirements for our manufacturing processes
and the way we must maintain certain records.

In 1997, Congress passed legislation that addresses the
regulation of pharmaceutical and medical devices.  Although the
impact of the FDA Administration Modernization Act of 1997 was
expected to reduce the quantity of information a company must
submit for approval of devices that has not been our experience.

Because the FDA regulates our noninvasive glucose sensor, we have
to meet all FDA requirements before we can market and sell our
device in the United States.  These requirements include clinical
testing, which must be supervised by the chosen hospitals.
During 1999, the FDA recommended we file a Pre-Market Application
and conduct an additional clinical study.  We are in the process
of submitting a modular PMA, which allows us to submit parts of
the submission to the FDA over a period of time.  This modular
PMA is a new method of submitting information to the FDA, and
resulted from the passage of FDA legislation in 1997.  We have
submitted the first two parts of the PMA and we began our
clinical trials in October 2000, after the FDA approved our
submission that included the testing protocol.  In March 2002, we
discontinued those trials in order to finish developing our
Diasensor 3000.

We don't know how long it will take for the FDA to accept our
filings or approve our device, if ever.

In June of 1998, the FDA instituted a new Quality System
Regulation that took the place of Good Manufacturing Practices.
These regulations align closely with similar guidelines required
by the European Union and have added control of the design
process as well as the manufacturing process.

There are different requirements for selling our device in
Europe.  On January 14, 1998, we received certification to ISO
9001 and to EN46001 for medical devices, and on June 23, 1998, we
received the CE mark.  The CE mark and the ISO certification are
provided by the regulatory bodies or other approved companies of
the European Union.  The CE mark indicates that the device
adheres to quality systems guidelines.   Rigorous audits were
conducted at our Indiana, Pennsylvania facility to certify that
our development and manufacturing procedures, as well as the
Diasensor 1000r itself met the international standards laid down
by Europe's medical device directive.  In order to maintain our
approval to ship the device into the European Union, we must be
vigilant in our adherence to our quality system.  We will also be
subject to annual audits to be sure that we continue to meet the
required standards.  Although we are not currently marketing our
device in Europe, we will maintain our ISO certification status
because we believe it provides a positive message regarding our
facility and operations and in case we decide to market outside
the U.S. in the future.

Any  changes  in FDA or European procedures or requirements  will
require  corresponding  changes in our obligations  in  order  to
maintain  compliance  with those standards.   Those  changes  may
result in additional delays or increased expenses.  Depending  on
which other countries we target, our products may also be subject
to  additional foreign regulatory approval before we can sell our
devices.

HUMAN RESOURCES

As of December 31, 2001, we had 119 full-time employees who were
located primarily in either our Indiana or Pittsburgh locations.
In addition, ViaCirq had 13 employees; and Petrol Rem had 30
employees, including 17 INTCO employees, as of December 31, 2001.

We have employment contracts with some of our non-officer
employees, most of whom are scientists and engineers employed in
our research and development operations.  Those contracts are
typically for terms of five years and contain confidentiality
provisions.  We also employ consultants as needed; some of the
consultants are employed based on consulting contracts, which
contain confidentiality provisions.

Financial Information About Foreign and Domestic Operations and
Export Sales

Our operations are located primarily in the United States of
America.  In 1994, we incorporated a majority-owned foreign
subsidiary, Diasense U.K. Limited, in order to facilitate the
opening of our office in London, England.    Although we have
taken some orders from our distributor in the U.K. and have
delivered devices for patient use, we have had no material sales,
foreign or domestic, since our inception.

Item 2. Properties

Due to cash flow problems, Diasense sold its office condominium
in 1999, and they now lease the same space for administrative
offices. We, along with our subsidiaries, continue to lease a
portion of that office at a monthly rental amount of $5,175 plus
one-half of the utilities.

Prior to 1999, our research and development operations were
located in a 20,000 square foot one-story building at 300 Indian
Springs Road, Indiana, PA.  We leased that building from the 300
Indian Springs Road Real Estate Partnership, which was owned in
part by some of our current and former officers and directors.
Of the eight members of the partnership, two are currently
officers or directors - Fred E. Cooper and Glenn Keeling. Each
member of the partnership personally guaranteed the payment of
lease obligations to the bank providing the funding, and in
return received warrants to buy 100,000 shares of our stock at
$.33 per share. In addition to rent, we paid all taxes,
utilities, insurance, and other expenses related to our
operations at that location.  In 1999, after all our Indiana, PA
operations were moved out of 300 Indian Springs Road location to
Kolter Drive, the property was put up for sale.  The property was
sold in October 2000 for $475,000, and each of the partners
received $12,698, after the mortgage was paid.

In September 1992, we entered into a ten-year lease agreement
with the Indiana County Board of Commissioners for 35,000 square
feet of space on Kolter Drive that we reconfigured to our
manufacturing specifications.  During 1998 and 1999, we moved the
balance of our Indiana, Pennsylvania operations to this space.
During 2000, we obtained an additional 33,000 square feet of
manufacturing space, which is being completed for manufacturing.
That space, which was originally obtained in 1995, was vacated in
1998 in return for the lessor's agreement not to pursue legal
action against us for nonpayment of rent.  In 2000, we settled
all the pending legal issues with the lessor when we reacquired
the space. This facility contains sufficient additional space to
accommodate our projected Indiana operations through 2002.

We believe that our existing facilities will be sufficient to
meet our needs through 2002.  If we require additional space, we
believe such space will be available at reasonable commercial
rates.

Item 3.  Legal Proceedings

In May 1996, we, along with Diasense and our current and former
individual directors, including David Purdy, Fred Cooper, and
Anthony J. Feola, who are also current and former Diasense
officers and directors, were served with a federal class action
lawsuit based on alleged misrepresentations and violations of
federal securities laws.  In 2000, even though we don't believe
any violations of the securities laws occurred, we agreed to
settle the lawsuit.  The parties reached a settlement, and we
have paid an aggregate of $3,250,000 toward the settlement to
date.  During the 3rd quarter of 2001, the parties agreed to
extend the payments on the remaining balance.  A balance of
$425,000 is due, including $225,000 for extending the due dates.
Although we don't know whether the class action plaintiffs have
been formally notified of the settlement, or if they have
accepted its terms, we believe the existing settlement agreement
will end this matter.  Due to cash flow problems, we did not make
the full final payment on the settlement.  We need to make an
additional payment of $425,000 in order to satisfy the terms of
the settlement.

In April 1998, we, along with our corporate affiliates, were
served with subpoenas requesting documents in connection with an
investigation by the U.S. Attorneys' office for the U.S. District
Court for the Western District of Pennsylvania.  We continue to
submit various scientific, financial and contractual documents in
response to their requests.

In April 1996, the Pennsylvania Securities Commission commenced a
private investigation into sales of Diasense common stock in a
public offering in an effort to determine whether any sales were
made improperly to Pennsylvania residents.  We cooperated fully
with the state and provided all of the information requested.  As
of the date of this filing, no determinations had been made, and
no orders have been issued.

Item 4.  Submission of Matters to a Vote of Security Holders

At a shareholders' meeting held on November 30, 2001, our
shareholders approved an increase in the number of our authorized
shares of common stock from 2.5 billion to 4 billion.

Item  5.   Market  for  Registrant's Common  Equity  and  Related
Stockholder Matters

Our common stock trades on the electronic bulletin board under
the symbol "BIKO".  On March 18, 2002,9, the closing bid price
for the common stock was $.14.$.018.  The following table sets
forth the high and low bid prices for our common stock during the
calendar periods indicated, through December 31, 2001.  Because
our stock trades on the electronic bulletin board, you should
know that these stock price quotations reflect inter-dealer
prices, without retail mark-up, markdown or commission, and they
may not necessarily represent actual transactions.



Calendar Year                    High            Low
and Quarter

1999            First Quarter    $ .084          $ .049
                Second Quarter   $ .340          $ .048
                Third Quarter    $ .125          $ .070
                Fourth Quarter   $ .099          $ .050

2000            First Quarter    $1.050          $.051
                Second Quarter   $.400           $.160
                Third Quarter    $.184           $.12
                Fourth Quarter   $.122           $.049

2001            First Quarter    $.1355          $.05
                Second Quarter   $.072           $.037
                Third Quarter    $.057           $.01
                Fourth Quarter   $.049           $.02

We have approximately 135,000 holders, including those who hold
in street name, of our common stock, and 41 holders of our
preferred stock.


                    DESCRIPTION OF SECURITIES

Our authorized capital currently consists of 4 billion shares of
common stock, par value  $.10 per share and 500,000 shares of
cumulative preferred stock, par value $10.00 per share.

Preferred Stock

Our Articles of Incorporation authorize the issuance of a
maximum of 500,000 shares of cumulative convertible preferred
stock, and authorize our board of directors to define the terms
of each series of preferred stock.  In 2001 and 2002, our board
of directors authorized the creation of five new series of
convertible preferred stock - series G, H, I, J and K.  The
certificates of designation for each series - the corporate
document that defines the terms of those series of preferred
stock - are exhibits to this document.  As of March 29, 2002 we
had a total of 32,280 shares of our preferred stock outstanding,
as follows:

    10,530 shares of Series G
     2,000 shares of Series H
     4,000 shares of Series I
       750 shares of Series J
    15,000 shares of Series K

None of our convertible preferred stock is secured by any of
our assets.  Each share of our preferred stock has a designated
value of $500 per share.  There is no minimum conversion price,
so the lower the bid price of our stock, the more shares we will
need to issue when our preferred stock is converted - there is no
limit on the number of shares of our common stock that our
preferred stock can be converted into.  This means that, if our
stock price is low, the preferred stockholders could own a large
percentage of our outstanding common stock - except that they
have each agreed not to own more than 5% of our common stock at
any one time.  We only sold our preferred stock to accredited
investors.  We can redeem our preferred stock.

Each series of preferred stock has its own minimum holding
period and each series defines its conversion price.

     Our series G preferred stock has a minimum holding period of
     the earlier of: 60 days from issuance or the date the
     registration statement covering the common stock is declared
     effective by the SEC.  The series G preferred is convertible into
     our common stock at a 24% discount to the 5-day average of our
     closing bid price immediately prior to conversion.

     Our series H preferred stock has a minimum holding period of
     the earlier of:  75 days from issuance or 35 days after the date
     the registration statement covering the common stock is declared
     effective by the SEC.  The series H is convertible into our
     common stock at a 20% discount to the 5-day average of our
     closing bid price immediately prior to conversion.

     Our Series J preferred stock has a minimum holding period of
     30 days from issuance and is convertible into our common stock at
     a 20% discount to the 5-day average of our closing bid price
     immediately prior to conversion.

As of March 2002, we raised a total of $6,640,000 from selling
our series G, H and J preferred stock.

We issued 4,000 shares of our series I preferred stock to Mr.
and Mrs. Farrell Jones as part of a renegotiation and settlement
of amounts due in connection with our purchase of ICTI back in
1998.  Even though we wrote off that entire investment, we still
owed the Joneses a total of $5,450,348.  In December 2001, we
finalized an agreement with the Joneses to decrease the amount
owed to a total of $2,887,500.  Of that total, $2 million was
applied when we issued them the 4,000 shares of series I
preferred stock.  The series I preferred is convertible at any
time into our common stock based on the 5-day average of our
closing bid price immediately prior to conversion.   None of the
series I has been converted to date. We don't have any other
relationship with the Joneses other than these remaining issues
from the ICTI transaction. You should review our management's
discussion and analysis section for more information on the
settlement with the Joneses.

In February 2002, we accepted a $25 million funding
commitment from J.P. Carey Asset Management, LLC, a Georgia
corporation.  The first part of the funding is through J.P. Carey
Asset Management's purchase of $7.5 million of our Series K
preferred stock.  We will not begin to receive it until our
registration statement covering the common stock underlying the
preferred is declared effective by the SEC.  We agreed to register
the underlying common stock for them.  We will receive money when
they convert the Series K preferred into common stock, based on the
following formula.  For example, if you apply the formula to last
month, we could have received about $1.7 million. If our stock price
and/or our trading volume decrease, we would receive less.

     First, compute the daily trading value for our stock: the
     closing bid price times that days' volume

     Second, compute that daily trading value for the 22 trading
     days prior to conversion

     Third, take the average of those 22 days trading value

     Finally, multiply that 22-day average by 6.

The conversion price for the Series K preferred is based on a
10% discount to the average of the lowest 3 consecutive closing
bid prices during the 22 days prior to conversion.  For example,
if conversion had occurred on March 18, 2002, it would have been
at a 10% discount to the average closing bid prices on March 6,
7, and 8, 2002.  That price, after the discount, would be $0.0158
per share.  If our stock price drops, the conversion price per
share will also drop.

Common Stock

Holders of our common stock are entitled to one vote per
share for each share held of record on all matters submitted to a
vote of stockholders.  Holders of our common stock do not have
cumulative voting rights, and therefore the holders of a majority
of the shares of common stock voting for the election of
directors may elect all of the directors, and the holders of the
remaining common stock would not be able to elect any of the
directors.  Subject to preferences that may be applicable to the
holders of our preferred stock, if any, the holders of our common
stock are entitled to receive dividends that may be declared by
our board of directors.

In the event of a liquidation, dissolution or winding up of
our operations, whether voluntary or involuntary, and subject to
the rights of any preferred stockholders, the holders of our
common stock would be entitled to receive, on a pro rata basis,
all of our remaining assets available for distribution to our
stockholders.  The holders of our common stock have no
preemptive, redemption, conversion or subscription rights.  As of
December 31, 2001, we had 2,450,631,111 shares of our common
stock outstanding.

Dividends

We have not paid cash dividends on our common stock, with the
exception of 1983, since our inception.  We do not anticipate
paying any dividends at any time in the foreseeable future.  We
expect to use any excess funds generated from our operations for
working capital and to continue to fund our various projects.

Our Articles of Incorporation restrict our ability to pay cash
dividends under certain circumstances.  For example, our board
can only declare dividends subject to any prior right of our
preferred stockholders to receive any accrued but unpaid
dividends.  In addition, our board can only declare a dividend to
our common stockholders from net assets that exceed any
liquidation preference on any outstanding preferred stock.

Employment Agreement Provisions Related to Changes in Control

We have employment agreements with change in control
provisions with the following officers: Fred E. Cooper, Anthony
J. Feola, Glenn Keeling and Michael P. Thompson.  The agreements
provide that in the event of a "change of control," we must:
issue to Mr. Cooper shares of common stock equal to 5%; issue to
Mr. Feola 4%; issue to Mr. Keeling 3%; and issue to Mr. Thompson
2% each of our outstanding shares of common stock. For purposes
of these agreements, a change of control is deemed to occur: when
20% or more of our outstanding voting stock is acquired by any
person; or when 1/3 or more of our directors are not continuing
directors, as defined in the agreements; or when a controlling
influence over our management or policies is exercised by any
person or by persons acting as a group within the meaning of the
federal securities laws.

Warrants

As of December 31, 2001, we had outstanding warrants - most
of which are not currently exercisable - to purchase 96,136,560
shares of our common stock.  These warrants have exercise prices
ranging from $.015 to $3.20 per share and expiration dates
through December 4, 2006, and are held by members of our
scientific advisory board, certain employees, officers,
directors, loan guarantors, and consultants.  As of December 31,
2001, many of our outstanding warrants were not currently
exercisable - 82,746,898 warrants were subject to a lock-up
arrangement where the warrant holders agreed not to exercise them
until August 2002.

Holders of warrants are not entitled to vote, to receive
dividends or to exercise any of the rights of the holders of
shares of our common stock for any purpose until the warrant
holder properly exercises the warrant and pays the exercise
price.

Transfer Agent

Mellon Investor Services in New York, New York acts as our
Registrar and Transfer Agent for our common stock.  We act as our
own registrar and transfer agent for our preferred stock and
warrants.

Item 6.  Selected Financial Data

                    YEARS ENDED DECEMBER 31st

                     2001       2000         1999        1998          1997
  Total Assets  $24,637,421  $21,930,070  $15,685,836  $9,835,569   $12,981,300

  Long-Term
  Obligations   $ 2,280,935  $ 2,211,537  $ 1,338,387  $1,412,880   $ 2,697,099

  Working
   Capital     ($10,429,990) $   754,368  $ 4,592,935 ($9,899,008)  $   888,082
   (Deficit)

  Preferred
   Stock        $   169,300  $         0  $   720,000  $        0   $         0

  Net Sales     $ 4,342,203  $   340,327  $   112,354  $1,145,968   $ 1,155,907

  TOTAL
   REVENUES     $ 4,349,918  $   345,874  $   165,251  $1,196,180   $ 1,260,157

  Other Income  $   561,817  $   589,529  $ 1,031,560  $  182,033   $   165,977

  Warrant
   Extensions   $         0  $ 5,233,529  $ 4,669,483  $        0   $ 4,046,875

  Benefit
  (Provision)
   for Income
    Taxes      ($   120,882) $         0  $         0  $        0   $         0

  Net Loss     ($30,942,310)($42,546,303)($38,072,578)($22,402,644)($30,433,177)

  Net Loss per
   Common Share:
    Basic             ($.02)       ($.04)       ($.05)       ($.08)       ($.43)
    Diluted           ($.02)       ($.04)       ($.05)       ($.08)       ($.43)

   Cash Dividends
    per share:

    Preferred          $  0         $  0         $  0         $  0         $  0
    Common             $  0         $  0         $  0         $  0         $  0

Item 7.  Management's Discussion and Analysis of Financial
Condition and Results of Operations

The following is a summary of the more detailed information in
our financial statements.  You should carefully review those
financial statements before you decide whether to invest in our
stock.

Forward-Looking Statements

This section contains forward-looking statements.  We discussed
these kinds of statements on page 2, and you should review that
section.

                 Liquidity and Capital Resources

We  continue  to  be dependent on security sales as  our  primary
source of working capital.  As of December 31, 2001, we had total
authorized   common   stock  of  4  billion   shares   of   which
2,450,631,111  shares  were  issued and  outstanding.  We  had  a
working  capital deficiency at December 31, 2001 of ($10,429,990)
as  compared to working capital of $754,368 at December 31,  2000
and  $4,592,935  at  December  31,  1999.   Our  working  capital
fluctuates  each  year due to the amount of  money  we  raise  by
selling  our  securities and the amount of money  we  spend.   We
raised approximately $16.4 million in 2001, $29.9 million in 2000
and $10.7 million in 1999 from selling our securities.

During the 4th quarter of 2001, we had significant cash flow
problems.  We believe those problems are in large part due to the
overall economic recession, which was aggravated by the tragedies
of September 11, 2001.  The stock market's resulting decline and
other factors beyond our control made it difficult for us to
raise money by selling our preferred stock.  We only raised
$6.465 million in 2001, which is much less than we expected.   As
a result, our payroll and our accounts payable are seriously past
due. We also have other serious obligations that are past due.
We still owe $425,000 in connection with our class action
settlement.  Although we are working with the class action
counsel to make payments on the amount due, we can't assure you
how long they will continue to work with us.  They could obtain
an order from the judge demanding that we pay the balance, and if
we can't, they could enter a judgment against us.

In  November 2001, our stockholders approved an increase  in  our
authorized  shares from 2.5 billion to 4 billion.  Once  the  new
shares  were  approved,  we began selling  convertible  preferred
stock  in a private offering, as we have done in the past.  Those
new  convertible  securities  will  not  be  and  have  not  been
registered  under  the federal securities laws  and  may  not  be
offered or sold in the United States without registration  or  an
applicable  exemption  from  registration  requirements.   During
November  and  December 2001, we issued the following  shares  of
convertible preferred stock:

    10,530 shares of Series G
     2,000 shares of Series H
     4,000 shares of Series I
       400 shares of Series J

None of our convertible preferred stock is secured by any of our
assets.  Each share of our preferred stock has a designated value
of $500 per share.  There is no minimum conversion price, so the
lower the bid price of our stock, the more shares we will need to
issue when our preferred stock is converted - there is no limit
on the number of shares of our common stock that our preferred
stock can be converted into.  This means that, if our stock price
is low, the preferred stockholders could own a large percentage
of our outstanding common stock - except that they have each
agreed not to own more than 5% of our common stock at any one
time.  We only sold our preferred stock to accredited investors.
We can redeem our preferred stock.

Each series of preferred stock has its own minimum holding period
and each series defines its conversion price.

     Our series G preferred stock has a minimum holding period of
     the earlier of: 60 days from issuance or the date the
     registration statement covering the common stock is declared
     effective by the SEC.  The series G preferred is convertible into
     our common stock at a 24% discount to the 5-day average of our
     closing bid price immediately prior to conversion.

     Our series H preferred stock has a minimum holding period of
     the earlier of:  75 days from issuance or 35 days after the date
     the registration statement covering the common stock is declared
     effective by the SEC.  The series H is convertible into our
     common stock at a 20% discount to the 5-day average of our
     closing bid price immediately prior to conversion.

     Our Series J preferred stock has a minimum holding period of
     30 days from issuance and is convertible into our common stock at
     a 20% discount to the 5-day average of our closing bid price
     immediately prior to conversion.

We raised a total of $6,465,000 from selling our series G, H
and J preferred stock in 2001.

We issued 4,000 shares of our series I preferred stock to Mr.
and Mrs. Farrell Jones as part of a renegotiation and settlement
of amounts due in connection with our purchase of ICTI back in
1998.  Even though we wrote off that entire investment, we still
owed the Joneses a total of $5,450,348.  In December 2001, we
finalized an agreement with the Joneses to decrease the amount
owed to a total of $2,887,500.  Of that total, $2 million was
applied when we issued them the 4,000 shares of series I
preferred stock.  The series I preferred is convertible at any
time into our common stock based on the 5-day average of our
closing bid price immediately prior to conversion.   None of the
series I has been converted to date. We don't have any other
relationship with the Joneses other than these remaining issues
from the ICTI transaction. Note J to our financial statements
contains more detail on the transaction with the Joneses.

When we sell or issue these convertible securities, it could
cause our stock price to fall significantly, and we don't have
any control over that.  Factors including the timing of
conversions and the additional number of shares needed for
conversion with no limit contribute to the downward pressure on
our stock price.  In addition, although the purchasers of our
convertible preferred stock agree not to sell our stock short, if
other investors sell short, it will further contribute to the
decline of our stock price.   In the past few years, we've sold
both convertible securities and common stock in various
offerings, all of which were on a best-efforts basis:

          We registered 800 million shares of common stock in the
          third quarter of 2001;

          We registered approximately 431 million shares in the third
          quarter of 2000, which included both common stock and conversion
          shares for convertible preferred stock and convertible
          debentures;

          We registered 375 million shares of common stock in the
          second quarter of 1999; and

          We registered 200 million shares of common stock in the last
          quarter of 1998.

Selling more of these convertible securities will further dilute
ownership of existing stockholders but, until we find another way
of raising significant funds, we must continue to sell our stock.

Our cash decreased to $268,095 as of December 31, 2001 from
$7,844,807 as of December 31, 2000 primarily due to the factors
discussed below.

During the year ended December 31, 2001 our net cash flow used by
operating activities was ($25,891,584).   During the same period,
our net cash flow used by investing activities was ($5,063,413)
due primarily to the acquisition of property, plant and
equipment, additional loans made to Practical Environmental
Solutions, a company involved in the acquisition and management
of environmental entities, investments in Rapid HIV, and
additional investments in unconsolidated subsidiaries which we
discuss in the following paragraphs.   We made all of these
investments because we believe that they will either generate
revenue or will help us with our diabetes-related projects.

During 2001, we made additional investments in unconsolidated
subsidiaries.  We invested an additional $190,000 in American
Inter-Metallics, bringing our total investment in AIM's rocket
propulsion project to $1,000,000. In addition, we loaned
$110,000 to Anthony J. DelVicario, the president of American
Inter-Metallics, Inc. and a former member of Diasense's board of
directors to help fund a transaction involving the creation of a
distribution system in Europe to sell AIM's products which we
believe will generate revenue. The original demand note was
secured by 110,000 shares of American Inter-Metallics, Inc.
common stock and bore interest at prime rate plus two percent.
In November 2001, we converted the original note into a new note
for $114,000 to reflect accrued interest.  The new note is
secured by an unconditional guaranty by American Inter-Metallics
and all of American Inter-Metallics' assets, including all of its
equipment. AIM informed us that they are in the final stage of
closing the transaction, and they expect to repay the loan; in
the interim, Mr. DelVicario began making monthly payments of
$5,000 per month in March 2002.  We also increased our total
investment in Insight Data Link.com, Inc. to $110,000 by
investing an additional $10,000.  We increased our investment in
AIM and Insight Data Link because our management believes they
will generate earnings.  However, AIM has not yet generated any
revenue, and Insight Data Link has only generated minimal
revenues of approximately $2,000 to date.   As a result, we will
not make any additional investments in either of those companies.

Our subsidiary, Diasense, Inc. also made investments in
unconsolidated subsidiaries during 2001.  Diasense invested an
additional $600,000 in MicroIslet, Inc., a company working with
Duke University on several diabetes research technologies that
focus on optimizing microencapsulated islets for transplantation.
The project is in the research and development phase. As of
December 31, 2001, Diasense had invested $1,600,000 in MicroIslet
and owned approximately 20.2% of this company.  Diasense also
increased its investment in Diabecore Medical, Inc.  Diabecore is
a company in Toronto working with other research institutions to
develop a new insulin to treat diabetes.  In 2001, Diasense
invested $293,948 in Diabecore increasing the total amount
invested to $987,468 and its ownership in this company to
approximately 24%.  This project is also in the research and
development phase.  Diasense increased these investments because
management believes that these diabetes research organizations
and the institutions they affiliate with will bring strength and
support to our own diabetes research and development projects.

As a result of those additional investments in American Inter-
Metallics, Insight Data Link.com, MicroIslet and Diabecore
Medical, our overall investment in unconsolidated subsidiaries
increased from $2,061,439 as of December 31, 2000 to $2,409,843
at December 31, 2001.

During the year ended December 31, 2001, our subsidiary, Petrol
Rem, advanced an additional $1,234,041 to Practical Environmental
Solutions, a Pennsylvania company that acquired technology used
to safely convert municipal sludge to recyclables that comply
with state and federal environmental laws.  Petrol Rem has loaned
a total of $3,148,404 to Practical Environmental as of December
31, 2001.  Practical Environmental has made interest payments on
the amount due. The loan, which was originally due on August 31,
2001 has been extended until May 31, 2002; no principal payments
have been made to date. The loan is classified as a non-current
asset as of December 31, 2001 because our management is
considering whether to convert all or part of that loan to an
equity investment - they are making that decision because
Practical Environmental is willing to make that conversion and
because Practical Environmental has been generating revenues
since January 2001.  As of December 31, 2001, although they are
still operating at a loss, Practical Environmental's internal
financial information shows revenues of $537,100.  We may
consider making additional loans or investments in Practical
Environmental if those loans or investments could help increase
earnings.

During the year ended December 31, 2001 Petrol Rem also invested
an additional $99,060 in Tireless LLC, which is another part of
our Petrol Rem operations, bringing our total equity investment
to $455,000.  Tireless is a company that shreds and helps recycle
tires, addressing some significant environmental issues that
arise from large piles of used tires.  We also loaned Tireless
$515,610 during the year ended December 31, 2001, which was used
primarily to purchase a mobile tire-shredding machine that is
being used to fulfill a contract in Ohio. As of December 31,
2001, Tireless has only generated $63,127 in revenues, and we are
re-evaluating whether to continue to invest in Tireless.

In 2001, we formed Rapid HIV Detection Corp. to market rapid HIV
tests.   In order to acquire the exclusive, world-wide marketing
rights to the rapid HIV tests, we entered into a marketing
agreement with GAIFAR, a German company which owned all the
rights to the tests, and Dr. Heinrich Repke, the man who
developed the tests.  The marketing rights were assigned to Rapid
HIV Detection Corp - we own 75% and GAIFAR owns 25% of Rapid
HIV's common stock.  We entered into the agreement in June 2001
and acquired the marketing rights at that time.  The initial
terms of the agreement allowed us a due diligence period of 8
weeks to withdraw from the agreement, but in July, all the
parties agreed to extend that date until October 15, 2001.    The
marketing agreement, which we filed as an exhibit to a Form 8-K
filed October 15, 2001, has a minimum ten-year term and calls for
total payments of $7,000,000 through the 3rd quarter of 2002.
That entire $7 million was accrued as of December 31, 2001, and
the rights are reflected in intangible assets.  When the
marketing agreement became effective in October 2001, $1.025
million of the funds previously loaned were applied to the total
$7 million consideration.  The original agreement called for a
loan in the amount of $500,000 to the owner of the rapid HIV
tests and technology, but we agreed to loan another $125,000
during the 2nd quarter while we continued our due diligence, so
the total loans were $625,000 as of June 30, 2001.  During the
3rd quarter of 2001, we loaned an additional $400,000 while we
completed our due diligence; the total loan amount applied to the
$7 million total due was $1,025,000.  The loan was made part of
the consideration we paid to acquire the exclusive worldwide
marketing rights to the rapid HIV tests and technology, and is
now part of our investment in Rapid HIV. The remaining $6 million
in payments are due from October 20, 2001 through August 20,
2002.  We made the $125,000 payments due in October and November
2001 and made additional payments totaling $125,000 through
January 2002.  Due to our cash flow problems, we were unable to
make additional payments when they were due.  As a result, we may
end up losing our exclusive marketing rights if we cannot bring
the payments due current by May 2002.

The money we spent investing in these companies came from notes
payable, debentures payable and stock sales during 2001.

In July 2001, we announced that ViaCirq entered into a Memorandum
of Understanding with Phoenix Hospital Management to pursue a
joint venture to market and sell ViaCirq products in China.  In
August we announced that negotiations were continuing.  The
tragic events of September 11, 2001 further delayed the travel
and communication necessary to continue meaningful work on or to
finalize the transaction.  As of the date of this filing, due
primarily to the international economic and trading instability
resulting from the terrorist attacks and the military response to
those attacks, we no longer believe this transaction is feasible
and have discontinued negotiations.   We may re-open negotiations
in the future, but at this point, we do not believe the joint
venture will occur.

Accounts receivable, net of allowance for doubtful accounts,
increased from $400,950 as of December 31, 2000 to $1,235,957 as
of December 31, 2001.  The increase is primarily attributable to
the increase in revenues for INTCO, a consolidated subsidiary of
Petrol Rem, and the timing of billings and collections related to
these revenues.  Due to our cash flow problems, we borrowed over
$500,000 from the minority owner of INTCO, our Louisiana oil-
spill clean-up company, and we secured that loan with our 51%
ownership in INTCO.  If we are unable to repay that loan when the
payments are due in April and June 2002, we may lose our
ownership interest in INTCO, and with it, a major source of
revenue.

Our net inventory increased from $805,224 as of December 31, 2000
to  $1,190,796 as of December 31, 2001.  The increase was
primarily due to an inventory build-up for the ThermoChem
hyperthermia products and for other manufacturing projects being
completed at our Indiana, PA facility.

Current related party receivables increased by $50,688 during the
year ended December 31, 2001 due to the $114,000 loan made to
Anthony DelVicario (a former member of Diasense's board of
directors) that was previously discussed.  This addition to
current related party receivables was partially offset by
repayments on other related party notes.

Acquisitions of property, plant and equipment included increases
of machinery and equipment aggregating $1,120,607 for the year
ended December 31, 2001 primarily due to additions of
hyperthermia equipment for our ViaCirq subsidiary and the
purchase of tire-shredding equipment for Petrol Rem's subsidiary,
Tireless.  Leasehold improvements increased by $222,955 primarily
due to renovations made to our Indiana, PA facility.

Related party receivables decreased by $138,445 due primarily to
repayments on related party notes.

Accounts payable increased by $4,176,925 during the year ended
December 31, 2001 due to the timing of payments that were slower
than normal due to our cash flow problems.  Notes payable
increased by $5,968,071 during 2001 primarily due to the
obligation incurred with the purchase of marketing rights by
Rapid HIV discussed above.  Our current portion of long-term debt
decreased by $4,027,236 during 2001 due to the negotiated
settlement of amounts due in connection with debt incurred when
ICTI was purchased.

On October 11, 2001, Petrol Rem borrowed $500,000 from the
minority owner of its subsidiary, INTCO, Inc., under a promissory
note that bears interest at 7% per year and is due in April 2002.
To secure payment of the note, Petrol Rem pledged all of its
shares in INTCO, Inc. The note is secured by our 51% interest in
INTCO, and if we don't make the payments when they are due in
April and June 2002, we could lose our investment in INTCO.

Debentures payable decreased by $2,400,000 during year ended
December 31, 2001 due to the conversion of $10,655,659 of
debentures into common stock partially offset by the sale of
$8,255,659 of convertible subordinated debentures to raise
capital to fund operations.  We had no debentures outstanding as
of December 31, 2001.

In July and August, we raised $11,164,000 through the sale of
common stock subscriptions. As of December 31, 2001, 769,410,092
shares of stock had been issued to satisfy $9,900,000 of these
subscriptions.  In addition, the Company repurchased
subscriptions totaling $1,264,000 for $1,453,600.  As a result of
the conversion of debentures and the issuance of common stock to
satisfy stock subscriptions, our common stock balance increased
to $245,063,111 as of December 31, 2001 compared to $138,370,417
as of December 31, 2000.  For the same reasons, our additional
paid in capital decreased from $87,035,096 at December 31, 2000
to $10,877,152 at December 31, 2001.

Although our revenues continue to grow, until we produce enough
revenues to fund our operations, we will have to find additional
financing that we'll use to finance development of, and to
proceed to manufacture, our various projects.  We can't assure
you that we'll be able to find that additional financing.

Our products are at various stages of development and we'll need
more money to complete them.  We may decide to discontinue any of
our projects at any time if research and development efforts
dictate that's the best thing to do.

Our financial statements contain a going concern opinion from our
auditors.  Our auditors issued that opinion because we have a
history of losses and very little revenue to support our
operations.  We get money to fund our operations by selling
securities - and we don't know if we'll be able to continue to
raise enough money that way.  Because we're not sure - and our
auditors are not sure - how long we can continue, our financial
statements include the auditor's opinion that we may not be able
to continue operating as a going concern.  We have a history of
successful capital-raising efforts; since 1989, and through
December 2001, we, along with Diasense, have raised over
$183,000,000 in private and public offerings alone.

We think that our long-term liquidity needs will include working
capital to fund manufacturing expenses for our products and
continued research and development expenses for existing and
future projects.   If our projects are delayed, we will need more
money.  We believe we will be able to continue selling our stock
and other securities in order to raise funds, but we can't assure
you we will be successful.  If we can't raise enough money to
fund our projects and operations, we will not be able to
continue. We don't have any other sources of funds, such as bank
lines of credit. We believe that, at some point, we will be able
to sell our products to generate revenue, but we can't assure you
when, or if, that will happen.


                         Results of Operations

The following ten paragraphs discuss the results of operations of
our entire company based on our consolidated financial
statements.  We discuss our business segments at the end of this
section.

Our net sales and corresponding costs of products sold during
2001 increased to $4,342,203 and $3,287,176 respectively in 2001
from $340,327 and $354,511 in 2000, and $122,354 and $147,971 in
1999.  The increase in 2001 was primarily due to sales of
$3,212,418 by Petrol Rem's subsidiary, INTCO, which was acquired
in the fourth quarter of 2000 and, therefore, not included in the
first nine months of 2000 or in 1999 operations.   Petrol Rem's
increase also included an increase in bioremediation product
sales to $108,092 during 2001 compared to $53,758 during 2000 and
$26,693 in 1999.  During the 3rd quarter, Petrol Rem received a
distribution agreement for approximately $125,000 per year from
an Alaskan oil spill clean-up company called F.R.O.G. to
distribute Petrol Rem products. The contract has an initial term
of one year, with automatic renewals on a yearly basis.  Due to
recent international events, including the September 11th
tragedy, the Alaskan company has been focused on other matters,
and they've told us that they hope to begin selling our products
soon.  Through Tireless, LLC, we received a sub-contract to help
clean up tire piles in Ohio.  We began that project at the
beginning of October, and we recently began billing for our
services.  We recognized revenues totaling $63,127 from the
Tireless project during 2001.  We believe the Tireless sub-
contract could generate revenue of at least $500,000 over the
next year based on our equipment's capacity to shred tires over
the one-year period of the contract.

In addition, we recognized sales of $339,839 from our
hyperthermia products during 2001, which produced sales of
$69,605 during 2000 and no sales in 1999.  The increase was due
to placements and installations of ViaCirq's ThermoChemHT system
and corresponding sales of disposables in several hospitals.

Other product sales increased in total, but not significantly.
In 2001, we received $112,091 from CCTI's metal coating products
compared with $40,593 in 2000 and no sales in 1999.  The increase
in sales of metal coating products was due primarily to the
introduction of a product line for sharpeners used for knives and
other tools in the professional culinary field, for sportsmen's
knives and fish hooks, for professional woodworkers and for
household use.  CCTI also continues to receive work from repeat
customers who sent us more work once they were satisfied with our
earlier performance.  As part of an overall effort to cut costs
and operate more efficiently, we are in the process of trying to
sell CCTI.

During 2001, we recognized sales of $28,057 for our theraPORT, an
implantable device used by patients who have repeated injections
of drugs.  The theraPORT is implanted in the patient's chest and
provides a fixed port for catheters used to deliver the drugs the
patient needs. Our 2001 theraPORT sales were higher than the
$20,068 in 2000 but lower than the $31,060 in 1999.  We also
recognized sales of $38,400 for HIV tests marketed by Rapid HIV
Corporation for the first time during 2001, because we just
acquired our interest in Rapid HIV.  Until we have significant
and consistent sales, we can't predict any trends for future
revenues.  Our costs of products sold increased due to the
increase in sales of our various products.

During the 3rd quarter of 2001, our manufacturing division in
Indiana, PA received contracts, which began generating revenue
during late 2001.  Our Biocontrol Technology division received a
$1.5 million manufacturing contract from the U.S. Army, and
$238,000 manufacturing contract from a private company.  We began
work on the U.S. Army contract, which we believe will generate
$1.5 million in revenue during the first year, beginning in the
4th quarter of 2001, with additional revenue for two additional
years; we filed a copy of that contract as an exhibit to our Form
8-K/A filed October 15, 2001.  During the 4th quarter of 2001,
our manufacturing division generated outside contract revenue
aggregating $410,998.

Research and Development expenses increased to $7,113,258 in 2001
from $6,651,471 in 2000 and $4,430,819 in 1999.   The increase
was due to expenses incurred for the Diasensor clinical trials
partially offset by reduced research activities on our
hyperthermia products and the redeployment of resources from
research activities to production of hyperthermia products.

General and administrative expenses increased a total of
approximately $471,650 for 2001 as compared to 2000.  The
increase is attributable to additional salaries, which include a
$912,727 payment to David L. Purdy in connection with his
resignation from the Company and its affiliates and new hiring at
ViaCirq and Petrol Rem (including INTCO and Tireless, LLC).  Also
contributing to the increase was higher travel expenses,
primarily for ViaCirq's and Petrol Rem's increased marketing
efforts. The above increases were partially offset by a decrease
in expense recognized in connection with the granting of warrants
for services. Our total general and administrative expenses were
approximately $22 million in 2001, $21.4 million in 2000 and
$12.9 million in 1999.

Amortization increased from $392,307 to $804,458 for 2000 to
2001, and increased $352,591 from 1999 to 2000.  The increases
are due to additional investments in unconsolidated subsidiaries
during 2000 and 2001 and our acquisition of the Rapid HIV
marketing rights in 2001.  A portion of these investments is
recognized as goodwill and amortized over a five-year period.
Our loss on unconsolidated subsidiaries increased to $279,986 for
the year ended December 31, 2001 compared to $158,183 for the
same period in 2000, and zero in 1999.  This loss results because
we absorb part of losses incurred by unconsolidated subsidiaries
and our investments began in 2000.  Our share of the loss is
determined by applying our ownership percentage to the total loss
incurred.

Debt issue costs increased from $1,005,000 in 2000 to $2,218,066
in 2001, a decrease from $3,458,300 in 1999.  The increase is due
to additional debentures and notes payable during 2001 compared
to 2000.  We had more debentures outstanding in 1999 than either
2000 or 2001.

Beneficial conversion terms included in our convertible
debentures are recognized as expense and credited to additional
paid in capital at the time the associated debentures are issued.
We recognized $2,063,915 of expense in connection with the
issuance of our subordinated convertible debentures in 2001
compared to $3,062,500 for 2000 and $7,228,296 in 1999.  The
amount varied because we issued fewer debentures this year
compared to last year, which was already a decrease from 1999.


                       Segment Discussion

For purposes of accounting disclosure, we provide the following
discussion regarding two business segments:  Bioremediation and
environmental clean-up, which includes the operations of Petrol
Rem, Inc., and Biomedical devices, which includes the operations
of our Biocontrol Technology division, Diasense, Inc., and
ViaCirq, Inc. More complete financial information on these
segments is set forth in Note H to our accompanying financial
statements.

Bioremediation Segment.  During the year ended December 31, 2001,
sales to external customers increased to $3,383,637 from $217,722
in 2000 and $26,693 in 1999.  The increase from 2000 to 2001 is
primarily due to revenues from INTCO.   The increase from 1999 to
2000 was due to our increased efforts to effectively penetrate
the market with products other than the BioSok.  Costs of
products sold also increased to $2,507,717 in 2001 from $179,446
in 2000 and $14,683 in 1999, primarily to due INTCO's operations.

Biomedical Device Segment.  During the year ended December 31,
2001, sales to external customers increased to $817,353 from
$81,954 in 2000 and $82,056 in 1999.  The overall increase was
primarily due to increased revenues from our ThermoChem products.
Corresponding overall increases in costs of products goods sold
occurred for the same reason, from $133,288 in 1999 to $47,862 in
2000 and $558,408 in 2001.

                          Income Taxes

Due to our net operating loss carried forward from previous years
and our current year losses, no federal or state income taxes
were required to be paid for the years 1987 through 2001 on
BICO's consolidated tax return. However, INTCO, Inc., a
subsidiary of Petrol Rem, Inc., files separate income tax returns
and the 2001 tax return included tax expense of $120,882. As of
December 31, 2001, we and our subsidiaries, except for Diasense,
Petrol Rem, Rapid HIV and ICTI had available net operating loss
carry forwards for federal income tax purposes of approximately
$157 million, which expire over the course of the years 2002
through 2022.

               Supplemental Financial Information

In February 2002, we accepted a $25 million funding commitment
from J.P. Carey Asset Management.  The initial funding will be
through their purchase of $7.5 million of our Series K preferred
stock.  We won't receive it until our registration statement
covering the 620 million shares needed to cover the Series K
conversions is declared effective. In addition, from October 2001
through January 2002, we raised funds aggregating approximately
$6.64 million by selling our convertible preferred stock.  We
discuss the specific terms of our classes of preferred stock in the
Description of Securities section beginning on page 24 of this
document.  Generally, the preferred stock is not secured by any
assets and can be converted into common stock at prices ranging
from 76-90% of our stock's average closing bid prices.  There is
no minimum conversion price.

We filed a registration statement on Form S-1 in February, but
withdrew it so we could update our financial statements with our
audited statements for the year ended December.  We plan to re-
file the registration statement in March 2002, and it will
include the shares of common stock that underlie our Series G, H,
I, J and K convertible preferred stock.

We recently obtained a $4 million bridge loan commitment to help us
meet our cash flow needs until the registration statement
covering the common stock underlying our preferred stock is
declared effective and we begin receiving funding from J.P. Carey
Asset Management.  We have already recived $1 million on the bridge
loan financing which is being held in escrow until the filing of our
registration statement. We expect to receive another $1 million within
the next 15 days, and the balance within 45 days. The bridge loan is
repayable in one year. We plan to use the money from the bridge loan
to help us bring our payroll and accounts payable more current, to make
the class action payments and to fund continuing operations.  However, we
can't assure you if that will happen, or if it will happen soon
enough to avoid lawsuits against us. We will use the money from
our Series K preferred stock to help repay our bridge loans.

We filed a Form S-8 in December 2001 that included 125 million
shares.  The Form S-8 allows us to issue freely tradable stock to
non-executive employees under our Equity Compensation plan and to
certain consultants in lieu of paying them in cash.  As of March
28, 2002, we've issued approximately 101.25 million shares of our
common stock from the Form S-8. We are preparing to file an
amendment to our Form S-8 to add another 200 million shares we
will use to retain consultants.

In the first quarter 2002 the Company's Board of Directors
directed Management to pursue the disposition of two consolidated
subsidiaries, Ceramic Coatings Technologies, Inc. (CCTI) and B-A-
Champ.com (dba TruePoints.com).  We are currently negotiating
with a buyer for CCTI although we are not sure what the final
terms of sale might be.

Item 8.  Financial Statements and Supplementary Data

The Company's financial statements appear on pages F-1 through
F-37 of this report.

Item 9.  Changes in and Disagreements with Accountants on
Accounting and Financial Disclosure

Effective August 24, 2000, upon a determination by the board of
directors, we engaged Goff Backa Alfera & Company, LLC as our
independent auditors and accountants to replace Thompson Dugan,
P.C.   Goff Backa Alfera & Company, LLC also serves as the
independent auditors and accountants for Diasense, replacing
Thompson Dugan, P.C.  Neither company had any disagreements with
Thompson Dugan, P.C. or Goff Backa Alfera & Company, LLC on any
matter of accounting principles or practices, financial statement
disclosure or auditing scope or procedure.

Item 10.  Directors and Executive Officers of the Registrant


   Name                Age   Director       Position
                               Since

Fred E. Cooper         56       1989        Chief Executive Officer,
                                            Executive Vice President,
                                            Director

Anthony J. Feola       53       1990        Chief Operating Officer,
                                            Director

Michael P. Thompson    52                   Chief Financial Officer

Glenn Keeling          50       1991        Senior Vice President,
                                            Director

Ben Johnson            57                   Executive Vice President

Stan Cottrell          58       1998        Director

Paul W. Stagg          54       1998        Director


FRED E. COOPER, 56, is our chief executive officer, executive
vice president and a director; he devotes approximately 60% of
his time to BICO, and 40% to Diasense.  Prior to joining us, Mr.
Cooper co-founded Equitable Financial Management, Inc. of
Pittsburgh, PA, where he was the executive vice president until
he left in August 1990.   Our board of directors appointed him
chief executive officer in January 1990. He is also an officer
and director of Diasense and Rapid HIV Detection Corp., and a
director of Petrol Rem and Coraflex.

ANTHONY J. FEOLA, 53, is our chief operating officer; he rejoined
BICO in April 1994, after serving as Diasense's vice president of
marketing and sales from January 1992 until April 1994. Prior to
January 1992, he was our vice president of marketing and sales.
Prior to joining us in November 1989, Mr. Feola was vice
president and chief operating officer with Gateway Broadcasting
in Pittsburgh in 1989, and national sales manager for
Westinghouse Corporation, also in Pittsburgh, from 1980 until
1989.  He was elected a director in February 1990, and also
serves as the secretary of Rapid HIV Detection Corp. and a
director of Diasense, Coraflex, and Petrol Rem.

MICHAEL P. THOMPSON, 51, joined BICO as our interim chief
financial officer in August 2000, and was elected our chief
financial officer by our board of directors in January 2001.
Prior to joining us, he was a partner in Thompson Dugan, P.C.,
the CPA firm that served as our outside auditors until August
2000, when Mr. Thompson joined us as interim CFO.  He has been a
CPA for over 25 years. He is also the chief financial officer for
Diasense and Petrol Rem, and a director of ViaCirq.

GLENN KEELING, 50, joined our board of directors in April 1991.
Mr. Keeling currently is a full-time employee of BICO in the
position of senior vice president; his primary responsibilities
are to manage our ViaCirq operations. From 1976 through 1991, he
was a vice president in charge of new business development at
Equitable Financial Management, Inc., a regional equipment
lessor.  His responsibilities included initial contacts with
banks and investment firms to open new lines of business
referrals in connection with financing large equipment
transactions.  He is also president and a director of ViaCirq.

BEN JOHNSON, 57, joined BICO in 2001 as our executive vice
president and the director of our Washington, DC office.  Prior
to joining us, he spent from 1993-2001 on the staff for the
President of the United States. From 1999-2001, he was the
assistant to the President and director of the President's
Initiative for One America, the first freestanding White House
office in history to focus on closing the opportunity gap that
exists for minorities in the U.S.  From 1997-1999, he was deputy
assistant to the President and deputy director of public liaison.
From 1993-1997, he served as special assistant to the President
and associate director of public liaison, the primary liaison to
the national African-American community.  He also serves as an
officer and director of Rapid HIV Detection Corp.

STAN COTTRELL, 58, was appointed to our board of directors in
1998.  Mr. Cottrell is the chairman and founder of Cottrell
Associates International, Inc., which provides international
business development, brokerage, specialty marketing and
promotional services.  He is a former director of marketing for
Inhalation Therapy Services and was employed by Boehringer
Ingelheim, Ltd. as a national product manager.  Mr. Cottrell is a
world ultra-distance runner and the author of several books.

PAUL W. STAGG, 54, was appointed to our board of directors in
1998.  Mr. Stagg is the owner of P.C. Stagg, LLC.  Prior to his
current position, he was the marketing manager for the Wholesale
Division of First Financial Resources, Inc., where he was
responsible for marketing, underwriting, sorting and coordinating
various types of financing for institutional investors.  Prior to
his current position, he was district distributor of marketing
for Ginger Mae, a division of United Companies of Baton Rouge,
LA.

Item 405 of Regulation S-K requires us to make disclosures
regarding timely filings required by Section 16(a) of the
Securities and Exchange Act.  Based solely on our review of
copies of forms received and written representations from certain
reporting persons, we believe that all of our officers, directors
and greater than ten percent beneficial owners complied with
applicable filing requirements.

Item 11.  Executive Compensation

The following table contains information on our executive
officer's annual and long-term compensation for their services to
us in all capacities for the years ended December 31, 2001, 2000
and 1999.  The executive officers included are those people who,
as of December 31, 2001 were: our chief executive officer, and
our other most highly compensated executive officers who were
paid more than $100,000.  In addition, we included information
regarding David L. Purdy, who was an executive officer and
director until June 2000, and the president of our Biocontrol
Technology division during 2000.  In November 2000, Mr. Purdy
resigned effective February 2001.



                         SUMMARY COMPENSATION TABLE
==============================================================================
             Annual Compensation              | (1)Long Term  Compensation
------------------------------------------------------------------------------
                                              |   Awards
Name and                                      | Securities
Principal                    Bonus($)  Other  | Underlying  (4) All other
Position      Year  Salary($)  (2)     ($)(3) | Warrants(#)  Compensation
==============================================================================
David L.                                      |
Purdy (5)     2001  $989,265  $0           $0 |           0          $0
              2000  $646,795  $200,000(6)  $0 |           0          $0
              1999  $450,000  $0           $0 |   4,000,000(4)       $0
------------------------------------------------------------------------------
Fred E.       2001  $977,115  $0           $0 |  15,000,000(4)       $0
Cooper,       2000  $939,000  $383,746(8)  $0 |           0          $0
CEO (7)       1999  $821,242  $200,000     $0 |   4,000,000(4)       $0
------------------------------------------------------------------------------
Anthony J.    2001  $660,248  $0           $0 |  10,000,000(4)       $0
Feola , Sr.   2000  $633,850  $268,190(10) $0 |           0          $0
Vice Pres.(9) 1999  $500,886  $0           $0 |   2,000,000(4)       $0
------------------------------------------------------------------------------
Glenn         2001  $483,732  $0           $0 |   8,000,000(4)       $0
Keeling, VP   2000  $500,000  $93,190(12)  $0 |           0          $0
(11)          1999  $302,083  $0           $0 |   2,000,000(4)       $0
------------------------------------------------------------------------------
Michael P.    2001  $317,375  $0           $0 |   3,000,000(4)       $0
Thompson,     2000  $103,243  $0           $0 |   1,000,000(4)       $0
Chief Financial
Officer (13)
------------------------------------------------------------------------------
R. Ben        2001  $191,171  $0           $0 |   1,500,000(4)       $0
Johnson,
Executive VP
(14)



(1)  We do not currently have a Long-Term Incentive Plan, and no
     payouts were made under any LTIP during the years 2001, 2000
     or 1999.  We issued warrants during those three years, which
     we also discuss in Note 4.  We do not have any retirement,
     pension or profit-sharing programs for the benefit of our
     directors, officers or other employees.

(2)  The amounts shown include both cash bonuses and dollar
     amounts reflecting stock bonuses.  The footnotes that follow
     break down the total amount for each executive officer.  The
     dollar amount shown for stock bonuses equals the number of
     shares of stock granted multiplied by the stock price on the
     grant date.  This valuation does not take into account the
     diminution in value attributable to the restrictions
     applicable to the shares based on short-swing profit or
     other restrictions.

(3)  During the year ended December 31, 2001, the executive
     officers received medical benefits under our group insurance
     policy, including disability and life insurance benefits.
     The total combined amount of all those benefits was less
     than 10% of the total annual salary and bonus reported for
     each executive officer.

(4)  On May 23, 2001, we granted Mssrs. Cooper, Feola, Keeling
     and Thompson warrants to purchase the number of shares
     listed.  All the warrants are exercisable at $.0525 per
     share - a price greater than our trading price on May 23,
     2001, until May 23, 2006.  During 2001, we also issued
     warrants to R. Ben Johnson, our new executive vice
     president.  We granted him warrants on July 30, 2001 that
     give him the right to purchase 1 million shares of our
     common stock at $.05 per share, until July 30, 2006; we also
     issued him warrants on December 3, 2001 that give him the
     right to purchase 500,000 shares of our common stock at $.05
     per share until December 3, 2006.  The $.05 exercise price
     on Mr. Johnson's loans exceeds the market price on the dates
     we issued the warrants.  During 2000, we issued warrants to
     Michael P. Thompson, our new chief financial officer.  We
     granted the warrants on August 28, 2000 that give him the
     right to purchase 1 million shares of our common stock at
     $.125 per share, which was the market price on the grant
     date, until August 28, 2005.   During 1999, we issued
     warrants to the executive officers listed.  All of the
     warrants were issued on April 28, 1999 at $.129 per share,
     which was the market price on the date of the warrant grant.
     For more detailed information, please refer to the
     "Option/Warrant/SAR Grants in Last Fiscal Year" table,
     below.

 (5) In 2001, we paid Mr. Purdy $912,727 by BICO, most of which
     was a severance payment he demanded when he resigned.  We
     also paid him $26,923 from our Biocontrol Technology
     division, and $49,615 from Diasense.   In 2000, we paid Mr.
     Purdy $196,795 by BICO and $450,000 by Diasense.  In 1999,
     he was paid $183,333 by BICO and $266,667 by Diasense.  All
     amounts are included in the table above. Mr. Purdy is paid
     by BICO based on his employment agreement.  Diasense paid
     Mr. Purdy based on its board of director's decisions for
     services performed on its behalf.  In June 2000, Mr. Purdy
     resigned as a BICO director and executive officer and became
     the president of our Biocontrol Technology division.  In
     November 2000, he resigned from that position effective
     February 2001.

(6)  In 2000, we paid Mr. Purdy a cash bonus of $200,000 from
     BICO.

(7)  In 2001, we paid Mr. Cooper $336,281 by BICO; $414,167 by
     Diasense; $80,000 each by Petrol Rem and ViaCirq; and
     $66,667 by Rapid HIV.  Due to our cash flow problems in the
     last quarter of 2001, Mr. Cooper agreed to accrue a total of
     $271,531 due him from all of the companies combined, rather
     than collect that amount in 2001.  In 2000, we paid Mr.
     Cooper $250,000 by BICO; $497,000 by Diasense; and $96,000
     each by Petrol Rem and ViaCirq.   Part of his salary from
     1998 was deferred and paid in 1999, and all amounts are
     included in the table above.  In 1999, he was paid $272,617
     by BICO; $340,625 by Diasense and $104,000 each by Petrol
     Rem and IDT, which is now ViaCirq All amounts are included
     in the table above. Mr. Cooper is paid by BICO based on his
     employment agreement.  Amounts paid to Mr. Cooper by
     Diasense, Petrol Rem, ViaCirq and Rapid HIV are determined
     by the boards of directors of those companies based upon
     services performed on their behalf.

(8)  In 2000, we paid Mr. Cooper a cash bonus of $200,000 from
     BICO.  In addition, we gave him a stock bonus of 1 million
     shares of our common stock.  We determined the value of his
     stock bonus, $183,746, using the stock price on the date of
     the bonus, even though he hasn't sold the stock.

(9)  In 2001, we paid Mr. Feola $472,748 by BICO and $187,500 by
     Diasense.  Due to our cash flow problems in the last quarter
     of 2001, Mr. Feola agreed to accrue a total of $157,729 due
     him from both companies, rather than collect that amount in
     2001.  In 2000, we paid Mr. Feola $408,850 by BICO and
     $225,000 by Diasense. Part of his salary from 1998 was
     deferred and paid in 1999, and all amounts are included in
     the table above.  In 1999, Mr. Feola was paid $425,886 by
     BICO and $75,000 by Diasense.  All amounts are included in
     the table above.  Mr. Feola is paid by BICO based on his
     employment agreement. Diasense paid Mr. Feola based on its
     board of director's decisions for services performed on its
     behalf.

(10) In 2000, we paid Mr. Feola a cash bonus of $175,000 by BICO.
     In addition, we gave him a stock bonus of 500,000 shares of
     our common stock.  We determined the value of his stock
     bonus, $93,190, using the stock price on the date of the
     bonus, even though he hasn't sold the stock.

(11) We pay Mr. Keeling based on his employment agreement. In
     2001, 57% of the amounts paid were allocated to ViaCirq.
     Due to our cash flow problems in the last quarter of 2001,
     Mr. Keeling agreed to accrue $283,184 due him rather than
     collect that amount in 2001.  In 2000, 50% of his salary was
     allocated to ViaCirq.  In 1999, 87% of his salary was
     allocated to IDT, now ViaCirq, based upon the time he
     devoted to its operations.

(12) In 2000, we gave Mr. Keeling a stock bonus of 500,000 shares
     of our common stock.  We determined the value of his stock
     bonus using the stock price on the date of the bonus, even
     though he hasn't sold the stock.

(13) Mr. Thompson was appointed our interim chief financial
     officer when he joined us in August 2000, and then appointed
     chief financial officer in 2001.  Due to our cash flow
     problems in the last quarter of 2001, Mr. Thompson agreed to
     accrue $52,474 due him rather than collect that amount in
     2001.  We pay him based on his employment agreement.

(14) Mr. Johnson was appointed our executive vice president when
     he joined us in January 2001.

          Option/Warrant/SAR Grants in Last Fiscal Year


                                                    POTENTIAL REALIZED
                                                     VALUE AT ASSUMED
                                                      ANNUAL RATES OF
                                                           STOCK
INDIVIDUAL GRANTS (1)                               PRICE APPRECIATION
                                                            FOR
                                                      OPTION TERM (3)

                            Percent of
                 Number of  Total
                 Securities Options/SAR's Exercise
                 Underlying Granted to    or      Expiration
                 Options/   Employees in  Base    Date     5%($)   10%($)  0%($)
   Name          SAR's      Fiscal Year   Price
                 Granted       (2)        ($/Sh)
                   (#)

Fred E.
Cooper        15,000,000       31%        $.0525   5/23/06 $      0 $172,500 $0

Anthony J.
Feola         10,000,000       21%        $.0525   5/23/06 $      0 $115,000 $0

Glenn Keeling  8,000,000       16%        $.0525   5/23/05 $      0 $ 92,000 $0

Michael P.
Thompson       3,000,000        6%        $.0525   5/23/06 $      0 $ 34,500 $0

R. Ben
Johnson        1,000,000                           7/30/06 $      0 $      0 $0
                 500,000        3%        $ 0.05  12/03/06 $      0 $      0 $0


(1)  The warrants in this table were granted during 2001.
     The warrants granted the executive officers the right
     to purchase the number of shares of common stock shown
     in the table at the price shown for five years.

(2)  For purposes of calculating this percentage, the total
     number of warrants granted to employees during 2001 was
     48.5 million.

(3)  Potential realizable values reflect the difference
     between the warrant exercise price at the end of 2001
     and the fair value of our common stock price from the
     date of the grant until the expiration of the warrant.
     The 5% and 10% appreciation rates, compounded annually,
     are assumed under to the rules adopted by the SEC and
     do not reflect actual historical or projected rates of
     appreciation of our common stock.  Assuming such
     appreciation, the following illustrates the per share
     value on the dates set forth, which are the expiration
     dates for the warrants, assuming the values set forth,
     which are the closing bid price on the date of the
     grant as reported by the electronic bulletin board:


          STOCK PRICE ON          EXPIRATION
          DATE OF GRANT              DATE           5%            10%

          05/23/01: $0.04          05/23/06       $0.051         $0.064
          07/30/01: $0.02          07/30/06       $0.025         $0.032
          12/03/01: $.025          12/03/06       $0.032         $0.040

     The foregoing values do not reflect appreciation
     actually realized by executive officers.  For more
     information on the warrants, review the next table.

(4)  The -0- amounts reflect the fact that, even at the end
     of the warrant term, based on the appreciation rate,
     the market price will be less than the exercise price.

     AGGREGATED OPTION/WARRANT/SAR EXERCISES IN LAST  FISCAL
     YEAR AND FISCAL YEAR-END OPTION/WARRANT/SAR VALUE TABLE

                              Number of       Value of
                              Securities      Unexercised
                              Underlying      In-the-Money
                              Unexercised     Options/SARs
                              Options/SARs    at
                              at              12/31/01 ($)
                              12/31/01 (#)
  Name    Shares    Value     Exercisable/    Exercisable/
          Acquired  Realized  Unexerciseable  Unexercisable
          on        ($)(2)     (3)            (4)
          Exercise
          (#)(1)

David L.      0     $   0      3,767,200     $    0
Purdy                              (5)            (11)

Fred E.       0     $   0     19,300,000     $    0
Cooper                             (6)            (11)

Anthony       0     $   0     12,550,000     $    0
J. Feola                           (7)            (11)

Glenn         0     $   0     10,100,000     $    0
Keeling                            (8)            (11)

Michael P.    0     $   0      4,000,000     $    0
Thompson                           (9)            (11)

R. Ben        0     $   0      1,500,000     $    0
Johnson                            (10)           (11)
__________________

(1)  This figure represents the number of shares of common
     stock acquired by each executive officer upon the
     exercise of warrants.  None of the executive officers
     exercised warrants during 2000.

(2)  The value realized of the warrants exercised is
     computed by determining the difference between the
     market value of our common stock on the exercise date
     minus the exercise price of the warrant.

(3)  All warrants held by the executive officers are
     currently exercisable.

(4)  The value of unexercised warrants was computed by
     subtracting the exercise price of the outstanding
     warrants from the closing sales price of our common
     stock on the last trading day of December 2000 as
     reported by the electronic bulletin board, which was
     $.049.

(5)  Includes warrants to purchase:  187,200 shares of
     common stock at $.25 per share until April 24, 2001;
     500,000 shares of common stock at $.25 per share until
     May 1, 2001; 80,000 shares of common stock at $.33 per
     share until June 29, 2003; and 3 million shares of
     common stock at $.129 per share until April 28, 2004.

(6)  Includes warrants to purchase: 300,000 shares of common
     stock at $.25 per share until May 1, 2001;  4 million
     shares of common stock at $.129 per share until April
     28, 2004; and 15 million shares of common stock at
     $.0525 per share until May 23, 2006.

(7)  Includes warrants to purchase:  100,000 shares of
     common stock at $.25 per share until May 1, 2001;
     100,000 shares of common stock at $.25 per share until
     November 26, 2003; 350,000 shares of common stock at
     $.50 per share until October 11, 2002; 2 million shares
     of common stock at $.129 per share until April 28,
     2004; and 10 million shares of common stock at $.0525
     per share until May 23, 2006.

(8)  Includes warrants to purchase: 100,000 shares of common
     stock at $1.48 per share until August 26, 2001; 2
     million shares of common stock at $.129 per share until
     April 28, 2004; and 8 million shares of common stock at
     $.0525 per share until May 23, 2006.

(9)  Includes warrants to purchase 1 million shares of
     common stock at $.125 per share until August 28, 2005;
     and 3 million shares of common stock at $.0525 per
     share until May 23, 2006.

(10) Includes warrants to purchase 1,000,000 shares of
     common stock at $.05 per share until July 30, 2006 and
     500,000 shares of common stock at $.05 per share until
     December 3, 2006.

(11) Because the market price as of the last trading day of
     December 2001 was less than the exercise price of the
     warrants, none of the warrants were in the money.

Employment Agreements

We have employment agreements with our executive officers,
Fred E. Cooper, Anthony J. Feola and Glenn Keeling effective
November 1, 1994, and Michael P. Thompson effective August
16, 2000.  Under those agreements, they are currently
entitled to receive annual salaries of $400,000,  $558,850,
$250,000 and $300,000 respectively, which are subject to
review and adjustment.   The initial term of the agreements
with Mr. Cooper was renewed in October 1999 for an
additional three-year term, which will automatically renew
for additional three-year terms unless one of the parties
gives proper notice of non-renewal; in November 2000, Mr.
Purdy resigned effective February 2001.  The initial term of
the agreements with Messrs. Feola and Keeling was renewed in
October 2001 for an additional two-year term, which will
automatically renew for additional two-year terms unless one
of the parties gives proper notice of non-renewal. ViaCirq
also has an employment agreement with Mr. Keeling, effective
December 3, 2000, under which he is entitled to receive an
annual salary of $350,000. The initial term of Mr.
Thompson's agreement will expire on August 31, 2005 and will
also automatically renew for additional two-year periods
unless one of the parties gives proper notice of non-
renewal.  The agreements also provide that in the event of a
"change of control", we are required to issue the following
shares of common stock, represented by a percentage of our
total outstanding shares of common stock immediately after
the change in control: 5% to Mr. Cooper; 4% to Mr. Feola; 3%
to Mr. Keeling; and 2% to Mr. Thompson.  In general, a
change of control would occur for purposes of the agreements
if:  20% or more of our outstanding voting stock is acquired
by any person; if 1/3 or more of our directors are not
continuing directors, as defined in the agreement; or when a
controlling influence over our management or policies is
exercised by any person or by persons acting as a group
within the meaning of Section 13(d) of the Securities
Exchange Act of 1934.

In addition, if there is a change in control during the term
of the agreements, or within one year afterwards, Messrs.
Cooper, Feola, Keeling and Thompson are entitled to receive
severance payments in amounts equal to: 100% of their most
recent annual salary for the first three years following
termination; 50% of their most recent annual salary for the
next two years; and 25% of their most recent salary for the
next five years.  We are also required to continue medical
insurance coverage for Messrs. Cooper, Feola, Keeling and
Thompson and their families during those periods. Those
severance payments will terminate in the event of the
employee's death.

In the event that Mr. Cooper becomes disabled, as defined in
his agreements, he will be entitled to the following
payments, in lieu of salary.  The disability payments would
be reduced by any amount paid directly to him under a
disability insurance policy if we provided one: 100% of his
most recent annual salary for the first three years; and 70%
of his most recent salary for the next two years.  In the
event that either Mr. Feola, Mr. Keeling or Mr. Thompson
becomes disabled, as defined in their agreements, he will be
entitled to similar payments: 100% of his most recent annual
salary for the first year; and 70% of his most recent salary
for the second year.

Under the employment agreements, Messrs. Cooper, Feola,
Keeling and Thompson are required to protect our
confidential information during the term of the agreements
and they are restricted from competing with us for a period
of one year in specified states following the expiration or
termination of the agreements.

In addition to the employment agreements we just described,
we have employment agreements with two of our non-executive
officer employees effective November 1, 1994.  The terms of
such agreements are similar to those described for Messrs.
Feola and Keeling above, with the following amendments:  the
term of one agreement is from November 1, 1994 through
October 31, 2002, and is renewable for successive two-year
terms; the term of the other agreement was renewed for an
additional two-year term in October 1999, and will
automatically renew for additional two-year terms unless one
of the parties terminates the agreement. In the event of a
change in control, we are required to issue both employees
shares of common stock equal to 2% of our outstanding shares
of common stock immediately after the change in control.

Purdy Agreement

In February 2001, we entered into an agreement with David L.
Purdy in connection with his resignation from our affiliates
and  us.   The  agreement required us to pay  Mr.  Purdy  an
aggregate  of  $912,727 plus $100,000 to  be  placed  in  an
escrow   account  for  his  future  attorney's  fees.    The
agreement  contains  confidentiality and release  provisions
for both Mr. Purdy and us.

Item  12.   Security Ownership of Certain Beneficial  Owners
and Management

The following table sets forth the indicated
information as of December 31, 2001 with respect to each
person who we know is beneficial owner of more than 5% of
the outstanding common stock, each of our directors and
executive officers, and all of our directors and executive
officers as a group.

As of December 31, 2001, we had 2,450,631,111 shares of
our common stock outstanding.  The table below shows the
common stock currently owned by each person or group,
including common stock underlying warrants, all of which are
currently exercisable, as of December 31, 2001.  The left-
hand column sets forth the percentage of the total number of
shares of common stock outstanding as of December 31, 2001,
which would be owned by each named person or group if they
exercised of all of their warrants, together with common
stock they currently owned.  An asterisk - * - means less
than 1%.  Except as otherwise indicated, each person has the
sole power to vote and dispose of each of the shares listed
in the columns opposite his name.


Name and                 Amount and      Percent of Beneficial
Address of               Nature of       Ownership of
Beneficial               Beneficial      Total Outstanding
Owner                    Ownership (1)   Common Stock (2)


Fred E. Cooper           21,076,200 (3)   *
2275 Swallow Hill Road
Bldg. 2500, 2nd Floor
Pittsburgh, PA  15220

Stan Cottrell             1,350,000 (4)   *
4619 Westhampton Drive
Tucker, GA 30084

Anthony J. Feola         13,404,000 (5)   *
2275 Swallow Hill Road
Bldg. 2500, 2nd Floor
Pittsburgh, PA 15220

Robert B. Johnson         1,500,000 (6)   *
1140 Connecticut Ave., NW
11th Floor
Washington, DC  20036

Glenn Keeling            10,738,500 (7)   *
2275 Swallow Hill Road
Building 2500,2nd Floor
Pittsburgh, PA 15220

Paul Stagg                1,570,000 (8)   *
168 LaLanne Road
Madisonville, LA 70447

Michael P. Thompson       4,000,000 (9)   *
2275 Swallow Hill Road
Bldg. 2500, 2nd Floor
Pittsburgh, PA 15220

All directors            53,638,700(10)   2.1%
and executive
officers as a
group (7 people)

NOTE:  The officers and directors listed above entered into
agreements not to exercise the warrants set forth below
until August 2002.  This means that the warrants are only
currently exercisable after that time.

(1) Includes ownership of all shares of common stock which
each named person or group has the right to acquire, through
the exercise of warrants, within sixty (60) days, together
with the common stock currently owned.

(2) Represents total number of shares of common stock owned
by each person, which each named person or group has the
right to acquire, through the exercise of warrants within
sixty (60) days, together with common stock currently owned,
as a percentage of the total number of shares of common
stock outstanding as of June 30, 2001. For individual
computation purposes, the total number of shares of common
stock outstanding as of June 30, 2001 has been increased by
the number of additional shares which would be outstanding
if the person or group exercised all outstanding warrants.

(3) Includes warrants to purchase the following: 300,000
shares of common stock at $.25 per share until May 1, 2003;
4,000,000 shares of common stock at $.129 per share until
April 28, 2004; and 15,000,000 shares of common stock at
$.0525 per share until May 23, 2006.  In addition, Mr.
Cooper is entitled to certain shares of common stock upon a
change of control of BICO as defined in his employment
agreement.

(4) Includes warrants to purchase 250,000 shares of common
stock at $.129 per share until April 28, 2004; and warrants
to purchase 1,000,000 shares of common stock at $.0525 until
May 23, 2006.

(5) Includes warrants to purchase the following: 100,000
shares of common stock at  $.25 per share until November 26,
2003; 100,000 shares of common stock at $.25 per share until
May 1, 2003; 350,000 shares of common stock at  $.50 per
share until October 11, 2002; 2,000,000 shares of common
stock at $.129 per share until April 28, 2004; and
10,000,000 shares of common stock at $.0525 per share until
May 23, 2006. In addition, Mr. Feola is entitled to certain
shares of common stock upon a change of control of BICO as
defined in his employment agreement.

(6) Includes warrants to purchase the following: 500,000
shares of common stock at $.0730 per share until January 11,
2006; and 1,000,000 shares of common stock at $.05 per share
until July 30, 2006.

(7) Includes warrants to purchase 100,000 shares of common
stock at $1.48 per share until August 26, 2003; 2,000,000
shares of common stock at $.129 per share until April 28,
2004; and 8,000,000 shares of common stock at $.0525 per
share until May 23, 2006.  In addition, Mr. Keeling is
entitled to certain shares of common stock upon a change of
control of BICO as defined in his employment agreement.

(8) Includes warrants to purchase 20,000 shares of common
stock at $.06 per share until April 27, 2003; 250,000 shares
of common stock at $.129 per share until April 28, 2004;
200,000 shares of common stock at $.102 per share until
February 1, 2006; and 1,000,000 shares of common stock at
$.0525 per share until May 23, 2006.

(9) Includes warrants to purchase 1,000,000 shares of common
stock at $.125 per share until August 28, 2005; and
3,000,000 shares of common stock at $.0525 per share until
May 23, 2006.  In addition, Mr. Thompson is entitled to
certain shares of common stock upon a change of control of
BICO as defined in his employment agreement.

(10) Includes shares of common stock available under
warrants to purchase an aggregate as set forth above.

Item 13.  Certain Relationships and Related Transactions

We share common officers and directors with our
subsidiaries.  In addition, BICO and Diasense have entered
into several intercompany agreements including a purchase
agreement, a research and development agreement and a
manufacturing agreement, which we describe later in this
section.  Our management believes that it was in our best
interest to enter into those agreements and that the
transactions were based upon terms as fair as those which
may have been available in comparable transactions with
third parties.  However, we did not hire any unaffiliated
third party to determine independently the fairness of those
transactions.  Our policy concerning related party
transactions requires the approval of a majority of the
disinterested directors of both the corporations involved,
if applicable.

Employment Relationships

Our board of directors approved employment agreements
on November 1, 1994 for our current officers, Fred E.
Cooper, Anthony J. Feola and Glenn Keeling, and approved an
employment agreement for Michael P. Thompson in August 2000.

Fred E. Cooper, chief executive officer, executive
vice president and a director, is a director of Diasense,
Petrol Rem, and Rapid HIV Detection Corp.  He is also the
CEO of Rapid HIV Detection Corp and the president of
Diasense.  Mr. Cooper devotes approximately 60% of his time
to BICO and 40% to Diasense. Anthony J. Feola, chief
operating officer and a director, is also the secretary of
Rapid HIV Detection Corp, and a director of Diasense, and
Petrol Rem.  Glenn Keeling is our senior vice president and
a director.   Mr. Keeling is also the president and a
director of ViaCirq.   Michael P. Thompson is our chief
financial officer. He is also the chief financial officer
for Diasense and Petrol Rem, and a director of ViaCirq.  Ben
Johnson, executive vice president and director of our
Washington, D.C. office, is also the executive vice
president and a director of Rapid HIV Detection Corp.

Property

Two of our current executive officers and/or directors
and three former directors are members of the nine-member
300 Indian Springs Road Real Estate Partnership that in July
1990 purchased our real estate in Indiana, Pennsylvania.
Each member of the partnership personally guaranteed the
payment of lease obligations to the bank providing the
funding.   The five members of the partnership who are also
current or former officers and/or directors of BICO, David
L. Purdy, Fred E. Cooper, Glenn Keeling, Jack H. Onorato and
C. Terry Adkins, each received warrants on June 29, 1990 to
purchase 100,000 shares of our common stock at an exercise
price of $.33 per share until June 29, 1995.  Those warrants
still outstanding as of the original expiration date were
extended until June 29, 2003.   Mr. Purdy, who was a
director and executive officer at the time of the
transaction, resigned from our board of directors on June 1,
2000, and resigned as an officer in November 2000, effective
February 2001.  Mr. Adkins, who was a director at the time
of the transaction, resigned from our board of directors on
March 30, 1992.  Mr. Keeling, who was not a director at the
time of the transaction, joined our board of directors on
May 3, 1991.   Mr. Onorato, who was not a director at the
time of the transaction, was a BICO director from September
1992 until April 1994.   The property was sold in October
2000 for $475,000, and each of the partners received
$12,698, after the mortgage was paid.

Like  all  our  warrants, the warrants issued  to  the
members  of  300 Indian Springs Road Real Estate Partnership
had  exercise  prices equal to or above the  current  quoted
market price of our common stock on the date of issuance.

Warrants

On April 28, 1999, we granted warrants to purchase our
common stock at $.129 per share until April 28, 2004 in the
following amounts:  4,000,000 to Fred E. Cooper, our chief
executive officer and a director; 2,000,000 to Anthony J.
Feola, our chief operating officer and a director; 2,000,000
to Glenn Keeling, our senior vice president and a director;
4,000,000 to David L. Purdy, our former chairman and
director; 250,000 to Stan Cottrell, a director; and 250,000
to Paul Stagg, a director.  The exercise price of $.129 per
share was equal to the market price on April 28, 1999.

On August 28, 2000, we granted warrants to purchase
1,000,000 shares of our common stock at $.125 per share
until August 28, 2005 to Michael P. Thompson, our chief
financial officer.  The exercise price of $.125 per share
was equal to the market price on August 28, 2000.

On January 11, 2001, we granted warrants to purchase
500,000 shares of our common stock at $.073 per share until
January 11, 2006 to Ben Johnson, our executive vice
president.  The exercise price of $.073 per share was equal
to the market price on January 11, 2001.

On February 1, 2001, we granted warrants to purchase
200,000 shares of our common stock at $.102 per share until
February 1, 2006 to Paul Stagg, a director.  The exercise
price of $.102 per share was equal to the market price on
February 1, 2001.

On May 23, 2001, we granted warrants to purchase our
common stock at $.0525 per share until May 23, 2006 in the
following amounts:  15 million to Fred E. Cooper, our chief
executive officer and a director; 10 million to Anthony J.
Feola, our chief operating officer and a director; 8 million
to Glenn Keeling, our senior vice president and a director;
3 million to Michael P. Thompson, our chief financial
officer; 1 million to Stan Cottrell, a director and 1
million to Paul Stagg, a director.  The exercise price of
$.0525 per share exceeded the market price on May 23, 2001.

On July 30, 2001, we granted warrants to purchase 1
million shares of common stock at $.05 per share until July
30, 2006 to Ben Johnson, our executive vice president.  The
exercise price of $.05 per share exceeded the market price
on July 30, 2001.

On December 3, 2001, we granted warrants to purchase
500,000 shares of common stock at $.05 per share until
December 3, 2006 to Ben Johnson, our executive vice
president.  The exercise price of $.05 per share exceeded
the market price on December 3, 2001.

Loans

In 1999, we consolidated all of Fred E. Cooper's
outstanding loans from us, including accrued interest, into
one loan in the amount of $777,399.80 at 8% interest.  Mr.
Cooper began repaying the loans in May of 1999.   The loan
balance as of December 31, 2001 was  $678,021.  Our
disinterested directors - with Mssrs. Cooper, Feola and
Keeling abstaining with respect to their individual
transactions- approved these loans because the disinterested
directors believed they were for a good business purpose.
The business purposes were: to provide Mr. Cooper with funds
during his initial years with BICO, when he waived a salary;
and to refinance loans secured by BICO stock, so the stock
wouldn't have to be sold when the loans were in default.
Mr. Cooper's individual loans, along with Mssrs. Feola and
Keeling's loans, had been, for period beginning in March
1996, secured by BICO certificates of deposits. Those CDs
were released in February 1998, when Mssrs. Cooper, Feola
and Keeling obtained loans from BICO and repaid the loans
which had been secured by BICO certificates of deposit. The
disinterested directors believed that if Mr. Cooper and the other
directors had been forced to sell their stock, and to
disclose the sale, it would have hurt our stock price
because many people view insider stock sales as a negative
message.  In 2001, Mr. Cooper gave his stock in B-A-
Champ.com to BICO; he no longer owns any interest in B-A-
Champ.com.

In 1999, we consolidated all of Anthony J. Feola's
outstanding loans from us, including accrued interest, into
one loan in the amount of $259,476.82 at 8% interest.  Mr.
Feola began repaying the loans in May of 1999.  The loan
balance as of December 31, 2001 was $197,570. Our
disinterested directors - with Mssrs. Feola, Cooper and
Keeling abstaining with respect to their individual
transactions- approved these loans because the disinterested
directors believed they were for a good business purpose.
The business purposes was to refinance loans secured by BICO
stock, so the stock wouldn't have to be sold when the loans
were in default.  Mr. Feola's individual loan, along with
Mssrs. Cooper and Keeling's loans, had been, for period
beginning in March 1996, secured by BICO certificates of
deposits.  Those CDs were released in February 1998, when
Mssrs. Cooper, Feola and Keeling obtained loans from BICO
and repaid the loans which had been secured by BICO
certificates of deposit. The disinterested directors believed
that if Mr. Feola and the other directors had been forced to
sell their stock, and to disclose the sale, it would have hurt
our stock price because many people view insider stock sales as
a negative message.

In 1999, we consolidated all of Glenn Keeling's
outstanding loans from us, including accrued interest, into
one loan in the amount of $296,358.07 at 8% interest.  Mr.
Keeling began repaying the loans in May of 1999.   The loan
balance as of December 31, 2001 was $150,161.  Our
disinterested directors - with Mssrs. Keeling, Feola and
Cooper abstaining with respect to their individual
transactions- approved these loans because the disinterested
directors believed they were for a good business purpose.
The business purposes was to refinance loans secured by BICO
stock, so the stock wouldn't have to be sold when the loans
were in default.  Mr. Keeling's individual loan, along with
Mssrs. Cooper and Feola's loans, had been, for period
beginning in March 1996, secured by BICO certificates of
deposits.  Those CDs were released in February 1998, when
Mssrs. Cooper, Feola and Keeling obtained loans from BICO
and repaid the loans which had been secured by BICO certificates
of deposit. The disinterested directors believed that if Mr.
Keeling and the other directors had been forced to sell their stock,
and to disclose the sale, it would have hurt our stock price
because many people view insider stock sales as a negative
message.

In September 1995, we granted a loan in the amount of
$250,000 to Allegheny Food Services in the form of a one-
year renewable note bearing interest at prime rate as
reported by the Wall Street Journal plus 1%.  Interest and
principal payments have been made on the note, and as of
December 31, 2001, the balance was $24,394.  Our board of
directors approved this loan because of its business purpose
- in return for granting the loan, we received an option to
purchase a franchise owned by Joseph Kondisko, a former
director of Diasense, who is a principal owner of Allegheny
Food Services.  The franchise generates revenue, which is
why we made the investment - until our products begin to
generate significant revenues;

In 2001, we granted a loan in the amount of $110,000 to
Anthony DelVicario, a former Diasense director and the
president of American Intermetallics.  We loaned him the
money because he used it to try to close a transaction in
Europe that will generate revenues.  The transaction
involves the creation of a distribution system in Europe to
sell American Inter-Metallic's products and generate
revenue.  In November 2001, we increased the amount due to
$114,000 to cover accrued interest and secured the loan with all
of the assets of American Intermetallics.  Mr. DelVicario began
making monthly payments on the loan in March 2002.

In April 2001, we loaned $70,000 to Pascal M. Nardelli,
President and Chief Executive Officer of Petrol Rem, Inc. In
August 2001, this demand note and accrued interest of $2,110
were paid in full.

All future loans to officers, directors and their affiliates
will also be made only after board approval, and for good
business purposes.

Consulting

In 2000, Thomas F. Feola, was engaged as an outside
consultant to assist with the identification and evaluation
of environmental companies for potential acquisitions,
mergers or strategic alliances. Thomas F. Feola is the
brother of Anthony J. Feola, COO and a director. We paid
Thomas Feola $64,000 in 2000 and $56,000 in 2001 for these
services which were terminated in August 2001.

Intercompany Agreements

Our management believes that the agreements between
BICO and Diasense, which are summarized below, were based
upon terms, which were as favorable as those that may have
been available in comparable transactions with third
parties.  However, we did not retain any unaffiliated third
party to determine independently the fairness of such
transactions.

License and Marketing Agreement.  Diasense acquired the
exclusive marketing rights for the noninvasive glucose
sensor and related products and services from BICO in August
1989 in exchange for 8,000,000 shares of Diasense's common
stock.  That agreement was canceled through a cancellation
agreement dated November 18, 1991, and superseded by a
purchase agreement dated November 18, 1991.  The
cancellation agreement provides that BICO will retain the
8,000,000 shares of Diasense common stock, which BICO
received under the license and marketing agreement.

Purchase agreement.  BICO and Diasense entered into a
purchase agreement dated November 18, 1991 whereby BICO gave
Diasense its entire right, title and interest in the
noninvasive glucose sensor and its development, including
its extensive knowledge, technology and proprietary
information.  Those transfers included BICO's patent
received in December 1991.

In consideration of the conveyance of its entire right in
the noninvasive glucose sensor and its development, BICO
received $2,000,000.  In addition, Diasense may try, at its
own expense, to obtain patents on other inventions relating
to the noninvasive glucose sensor.  Diasense also guaranteed
BICO the right to use that patented technology in the
development of BICO's proposed implantable closed-loop
system, a related system in the early stages of development.

In December 1992, BICO and Diasense executed an amendment to
the purchase agreement, which clarified terms of the
purchase agreement.  The amendment defines sensors to
include all devices for the noninvasive detection of
analytes in mammals or in other biological materials.  In
addition, the amendment provides for a royalty to be paid to
Diasense in connection with any sales by BICO of its
proposed closed-loop system.

Research and Development Agreement.  Diasense and BICO
entered into an agreement dated January 20, 1992 in
connection with the research and development of the
noninvasive glucose sensor.  Under the agreement, BICO will
continue the development of the noninvasive glucose sensor,
including the fabrication of prototypes, the performance of
clinical trials, and the submission to the FDA of all
necessary applications in order to obtain market approval
for the noninvasive glucose sensor.  BICO will also
manufacture the models of the noninvasive glucose sensor to
be delivered to Diasense for sale under the terms of a
manufacturing agreement.  Upon the delivery of the completed
models, the research and development phase of the
noninvasive glucose sensor will be deemed complete.

Diasense agreed to pay BICO $100,000 per month for indirect
costs beginning April 1, 1992, during the 15 year term of
the agreement, plus all direct costs, including labor.  BICO
also received a first right of refusal for any program
undertaken to develop, refine or improve the noninvasive
glucose sensor, and for the development of other related
products.  In July 1995, BICO and Diasense agreed to suspend
billings, accruals of amounts due and payments under to the
research and development agreement pending the FDA's review.

Manufacturing Agreement.  BICO and Diasense entered into an
agreement dated January 20, 1992, whereby BICO will act as
the exclusive manufacturer of the noninvasive glucose sensor
and other related products.  Diasense will provide BICO with
purchase orders for the products and will endeavor to
provide projections of future quantities needed.  The
original manufacturing agreement called for the products to
be manufactured and sold at a price to be determined in
accordance with the following formula: Cost of Goods,
including actual or 275% of overhead, whichever is lower,
plus a fee of 30% of cost of goods.  In July 1994, the
formula was amended to be as follows: costs of goods sold
was defined as BICO's aggregate cost of materials, labor and
associated manufacturing overhead + a fee equal to one third
of the difference between the cost of goods sold and
Diasense's sales price of each sensor.  Diasense's sales
price of each sensor is defined as the price paid by any
purchaser, whether retail or wholesale, directly to Diasense
for each sensor.  Subject to certain restrictions, BICO may
assign its manufacturing rights to a subcontractor with
Diasense's written approval.  The term of the agreement is
fifteen years.

Item  14.   Exhibits,  Financial  Statement  Schedules,  and
Reports on Form 8-K

(a)  1.   Financial Statements

The  financial statements, together with the report  thereon
of  the  Company's independent accountants, are included  in
this report on the pages listed below.

     Financial Statements                                        Page

     Report of Independent Certified Public Accountants
     Goff Backa Alfera & Company, LLC                            F-1

     Consolidated Balance Sheets
     December 31, 2001 and 2000                                  F-2

     Consolidated Statements of Operations
     for the years ended December 31, 2001, 2000 and 1999        F-4

     Consolidated Statements of Stockholders' Equity
     for the years ended December 31, 2001, 2000 and 1999        F-5

     Consolidated Statements of Cash Flows
     for the years ended December 31, 2001, 2000 and 1999        F-6

     Notes to Consolidated Financial Statements
     December 31, 2001, 2000 and 1999                            F-8

     2.   Exhibits:

(b)  Reports on Form 8-K

     The  Company  filed a Form 8-K report on  November  20,
     2001,  for  the  event dated November 11,  2001.    The
     items  listed were Item 5, Other Events; and Item 7(c),
     Exhibits.

     The  Company  filed a Form 8-K report on  November  30,
     2001, for the event dated November 30, 2001.  The items
     listed  were  Item  5,  Other Events;  and  Item  7(c),
     Exhibits.

     The  Company  filed a Form 8-K report on  December  10,
     2001,  for the event dated December 6, 2001.  The  item
     listed  was  Item  5,  Other  Events;  and  Item  7(c),
     Exhibits.

     The Company filed a Form 8-K report on January 3, 2002,
     for  the event dated January 3, 2002.  The items listed
     were Item 5, Other Events; and Item 7(c), Exhibits.

     The  Company  filed a Form 8-K report  on  January  18,
     2002,  for the event dated January 17, 2002.  The items
     listed  were  Item  5,  Other Events;  and  Item  7(c),
     Exhibits.

     The Company filed a Form 8-K report on January 24, 2002
     for the event dated January 23, 2002.  The items listed
     were Item 5, Other Events; and Item 7(c), Exhibits.

     The Company filed a Form 8-K report on January 25, 2002
     for the event dated January 24, 2002.  The items listed
     were Item 5, Other Events; and Item 7(c), Exhibits.

     The  Company  filed a Form 8-K report on  February  19,
     2002  for the event dated February 19, 2002.  The Items
     listed  were  Item  5,  Other Events;  and  Item  7(c),
     Exhibits.

     The  Company filed a Form 8-K report on March  8,  2002
     for  the  event dated March 8, 2002.  The Items  listed
     were Item 5, Other Events; and Item 7(c), Exhibits.

     The  Company filed a Form 8-K report on March 14,  2002
     for  the event dated March 13, 2002.  The Items  listed
     were Item 5, Other Events; and Item 7(c), Exhibits.

     The  Company filed a Form 8-K report on March 14,  2002
     for  the event dated March 14, 2002.  The Items  listed
     were Item 5, Other Events; and Item 7(c), Exhibits.


(c)  Exhibits Required by Item 601 of Regulation S-K

The  following  exhibits required by Item 601 of  Regulation
S-K  are  filed as part of this report.  Except as otherwise
noted,  all  exhibits  are incorporated  by  reference  from
exhibits to Form S-1 (Registration #33-55200) filed December
1,  1992 or from exhibits to Form 10-K filings prior  to  or
subsequent to that date.

3.1(4) Articles of Incorporation as filed March 20, 1972

3.2(4) Amendment to Articles filed May 8,1972

3.3(4) Restated Articles filed June 19,1975

3.4(4) Amendment to Articles filed February 4,1980

3.5(4) Amendment to Articles filed March 17,1981

3.6(4) Amendment to Articles filed January 27,1982

3.7(4) Amendment to Articles filed November 22,1982

3.8(4) Amendment to Articles filed October 30,1985

3.9(4) Amendment to Articles filed October 30,1986

3.10(4) By-Laws

3.11(5)  Amendment to Articles filed December 28,1992

3.12(8)  Amendment to Articles filed February 7, 2000

3.13(12) Amendment to Articles filed June 14, 2000

3.14     Amendment to Articles filed November 30, 2001

3.15     Certificate of Designation of Series G Preferred
          Stock

3.16     Certificate of Designation of Series H Preferred
          Stock

3.17     Certificate of Designation of Series I Preferred Stock

3.18     Certificate of Designation of Series J Preferred Stock

3.19     Certificate of Designation of Series K Preferred Stock

10.1(1)  Manufacturing Agreement

10.2(1)  Research and Development Agreement

10.3(1)  Termination Agreement

10.4(1)  Purchase Agreement

10.5(2)  Sublicensing Agreement and Amendments

10.6(3)  Lease Agreement with 300 Indian Springs Partnership

10.7(4)  Lease Agreement with Indiana County

10.8(5)  First Amendment to Purchase Agreement dated
          December 8, 1992

10.9(6)  Fred E. Cooper Employment Agreement dated November
          1, 1994

10.10(6) David L. Purdy Employment Agreement dated November
          1, 1994

10.11(6) Anthony J. Feola Employment Agreement dated November
          1, 1994

 10.12(6)Glenn Keeling Employment Agreement dated November
          1, 1994

10.13(9) David L. Purdy resignation as a director letter
          dated June 1, 2000

10.14(11)Michael P. Thompson Employment Agreement dated
          August 16, 2000

10.15(13)Marketing Agreement by and between BICO, Rapid HIV
          Detection Corp., GAIFAR and Dr. Heinrich Repke

10.16(13)Contract between Biocontrol Technology, Inc. and
          U.S. Army Assistance

16.1(7)  Disclosure and Letter Regarding Change in Certifying
          Accountants dated January 25, 1995

16.2 (10)Disclosure and Letter Regarding Change in
          Certifying Accountants dated August 24, 2000


   (1) Incorporated by reference from Exhibit with this
       title filed with BICO's Form 10-K for the year ended
       December 31, 1991

   (2) Incorporated by reference from Exhibit with this
       title to Form 8-K dated May 3, 1991

   (3) Incorporated by reference from Exhibit with this
       title to Form 10-K for the year ended December 31, 1990

   (4) Incorporated by reference from Exhibit with this
       title to Registration Statement on Form S-1 filed on
       December 1, 1992

   (5) Incorporated by reference from Exhibit with this
       title to Amendment No. 1 to Registration Statement on Form S-
       1 filed on February 8, 1993

   (6) Incorporated by reference from Exhibit with this
       title to Form 10-K for the year ended December 31, 1994

   (7) Incorporated by reference from Exhibit with this title
       to Form 8-K dated January 25, 1995

   (8) Incorporated by reference from Exhibit with this title
       to Form 10-K for the year ended December 31, 1999

   (9) Incorporated by reference from Exhibit with this title
       to Form 8-K dated June 2, 2000

  (10) Incorporated by reference from Exhibit with this title
       to Form 8-K filed August 24, 2000

  (11) Incorporated by reference from Exhibit with this title
       to Form 10-K for the year ended December 31, 2000

  (12) Incorporated by reference from Exhibit with this title
       to Form S-1 filed July 9, 2001

  (13) Incorporated by reference from Exhibit with this title
       to Form 8-K/A filed October 15, 2001

Conformed Copy
                         SIGNATURES

     Pursuant to the requirements of Section 13 or 15(d) of
the Securities Exchange Act of 1934, the Company has duly
caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized, on the 1st day of
April 2002.

                                   BICO, INC.


                                   /s/ Fred E. Cooper
                                   By: Fred E. Cooper
                                   CEO,  principal executive
                                   officer and director


     Pursuant to the requirements of the Securities Exchange
Act of 1934, the following persons on behalf of the
Registrant and in the capacities and on the dates indicated
have signed this report below.

Signature                Title                         Date


/s/ Anthony J. Feola       Senior Vice President,        April 1, 2002
Anthony J. Feola           Director


/s/ Michael P. Thompson    Chief Financial Officer,      April 1, 2002
Michael P. Thompson        principal financial officer,
                           principal accounting officer

/s/ Glenn Keeling          Director                      April 1, 2002
Glenn Keeling


/s/ Stan Cottrell          Director                      April 1, 2002
Stan Cottrell

/s/ Paul W. Stagg          Director                      April 1, 2002
Paul W. Stagg



                Report of Independent Accountants





The Board of Directors and Stockholders
BICO, Inc.

     We have audited the accompanying consolidated balance sheets
of  BICO,  Inc. and its subsidiaries as of December 31, 2001  and
2000,  and  the  related consolidated statements  of  operations,
stockholders' equity (deficiency) and cash flows for each of  the
three  years  in  the  period ended  December  31,  2001.   These
consolidated financial statements are the responsibility  of  the
Company's  management.   Our  responsibility  is  to  express  an
opinion on these consolidated financial statements based  on  our
audits.

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

      In  our  opinion,  the  consolidated  financial  statements
referred  to above present fairly, in all material respects,  the
consolidated   financial  position  of   BICO,   Inc.   and   its
subsidiaries  as  of  December  31,  2001  and  2000,   and   the
consolidated  results of its operations and its  cash  flows  for
each of the three years in the period ended December 31, 2001, in
conformity with U.S. generally accepted accounting principles.

     The accompanying consolidated financial statements have been
prepared  assuming  that the Company will  continue  as  a  going
concern.  As discussed in note B to the financial statements, the
Company  has  incurred losses from operations and  negative  cash
flows  from operations for each of the three years in the  period
ended  December  31, 2001, and these conditions are  expected  to
continue  through  2002,  raising  substantial  doubt  about  its
ability  to continue as a going concern.  Management's  plans  in
regard  to  these  matters are also discussed  in  note  B.   The
financial  statements do not include any adjustments  that  might
result   from   the   outcome  of  this  uncertainty,   including
adjustments relating to the recoverability and classification  of
recorded assets that might be necessary in the event the  Company
cannot  continue to meet its financing requirements  and  achieve
productive operations.



Goff Backa Alfera & Company, LLC

Pittsburgh, Pennsylvania

February 28, 2002
(except for Note S, as to which
the date is March 29, 2002)

<TABLE>
                                       BICO, Inc. and Subsidiaries
                                       Consolidated Balance Sheets
<CAPTION>

                                                            Dec. 31, 2001    Dec. 31, 2000
                                                            -------------    -------------
<S>                                                        <C>              <C>
CURRENT ASSETS
 Cash and equivalents (note A)                              $     268,095     $  7,844,807
 Accounts receivable - net of allowance for doubtful accounts
   of $43,664 at Dec. 31, 2001 and 2000                         1,235,957          400,950
 Inventory - net of valuation allowance (notes A and D)         1,190,796          805,224
 Related party notes receivable (notes C and O)                   138,394           87,706
 Notes  receivable (note C)                                             -           12,000
 Notes receivable-Practical Environmental Sol.,Inc.(note C)             -        1,914,363
 Interest receivable (note C)                                     144,411           48,252
 Prepaid expenses (note E)                                      1,055,901          988,354
 Other current assets                                              62,268           47,268
                                                            -------------    -------------

                 TOTAL CURRENT ASSETS                           4,095,822       12,148,924


PROPERTY, PLANT AND EQUIPMENT (notes A and K)
 Building                                                       2,566,777        2,529,176
 Land                                                             246,250          246,250
 Leasehold improvements                                         2,071,629        1,848,674
 Machinery and equipment                                        7,526,201        6,405,594
 Furniture, fixtures & equipment                                  937,607          921,195
                                                            -------------    -------------
                                                               13,348,464       11,950,889

 Less accumulated depreciation                                  6,151,384        5,288,910
                                                            -------------    -------------
                                                                7,197,080        6,661,979

OTHER ASSETS
 Related Party Receivables
  Notes receivable - (notes C and O)                            1,036,293        1,174,738
  Interest receivable - (notes C and O)                            14,406           13,463
                                                            -------------    -------------
                                                                1,050,699        1,188,201
  Allowance for related party receivables                      (1,050,699)      (1,188,201)
                                                            -------------     ------------
                                                                        -                -

 Notes receivable - (note C)                                      111,041          200,000
 Notes receivable-Practical Environmental Sol., Inc. (note C)   3,148,404                -
 Goodwill, net of amortization  (notes A and R)                   595,217          694,895
 Intangible assets - marketing rights (Note F)                  6,866,398                -
 Investment in unconsolidated subsidiaries-(notes A and G)      2,409,843        2,061,439
 Other assets                                                     213,616          162,833
                                                            -------------    -------------
                                                               13,344,519        3,119,167
                                                            -------------    -------------
         TOTAL ASSETS                                       $  24,637,421      $21,930,070
                                                            =============    =============

The accompanying notes are an integral part of these statements.

</TABLE>
<PAGE>  F-2
<TABLE>
                                            BICO, Inc. and Subsidiaries
                                            Consolidated Balance Sheets
                                                    (Continued)
<CAPTION>

                                                            Dec.31, 2001      Dec. 31, 2000
                                                            ------------      -------------
<S>                                                         <C>               <C>
CURRENT LIABILITIES
  Accounts payable                                           $  4,755,445      $   578,520
  Notes payable (note J)                                        7,037,198        1,069,127
  Current portion of long-term debt (note J)                       86,420        4,113,656
  Current portion of capital lease obligations (note K)            75,523           98,788
  Debentures payable (note L)                                           -        2,400,000
  Accrued liabilities (note I)                                  2,568,526        3,131,765
  Escrow payable (note M)                                           2,700            2,700
                                                             ------------     -------------
        TOTAL CURRENT LIABILITIES                              14,525,812       11,394,556

LONG-TERM LIABILITIES
  Capital lease obligations (note K)                            2,128,149        2,203,673
  Long-term debt (note J)                                         127,777            7,864
  Other                                                            25,009                -
                                                             -------------    -------------
                                                                2,280,935        2,211,537


COMMITMENTS AND CONTIGENCIES (note P)

UNRELATED INVESTORS'INTEREST
   IN SUBSIDIARIES (note A)                                       293,527          434,990

STOCKHOLDERS' EQUITY (note M)

   Common stock, par value $.10 per share,
   authorized 4,000,000,000 shares at Dec. 31,
   2001 and 1,700,000 shares at Dec. 31, 2000, outstanding
   2,450,631,111 shares at Dec. 31, 2001 and 1,383,704,167
   at Dec. 31, 2000                                           245,063,111      138,370,417
   Convertible preferred stock, par value $10
   per share, authorized 500,000 shares issuable in
   series, shares issued and outstanding 16,930 at
   December 31, 2001 and none at December 31, 2000.               169,300                -
   Discount assigned to beneficial conversion feature -
     preferred stock (note M)                                    (141,000)               -
   Additional paid-in capital                                  10,887,152       87,035,096
   Warrants                                                     6,221,655        6,204,235
   Accumulated deficit                                       (254,663,071)    (223,720,761)
                                                             -------------    -------------
          TOTAL STOCKHOLDERS' EQUITY                            7,537,147        7,888,987
                                                             -------------   --------------
          TOTAL LIABILITIES AND
            STOCKHOLDERS' EQUITY                             $ 24,637,421     $ 21,930,070
                                                             =============    =============

The accompanying notes are an integral part of these statements.

</TABLE>
<PAGE> F-3
<TABLE>
                                             BICO,  INC.  AND  SUBSIDIARIES
                                       CONSOLIDATED  STATEMENTS  OF  OPERATIONS

<CAPTION>

                                                             Year Ended December 31,
                                                    2001             2000              1999
                                                -------------    -------------    -------------
<S>                                             <C>               <C>             <C>
Revenues
  Net sales                                      $4,342,203        $   340,327    $   112,354
  Other income                                        7,715              5,547         52,897
                                                -------------    -------------    -------------
                                                  4,349,918            345,874        165,251

Costs and expenses
  Cost of products sold                           3,287,176            354,511        147,971
  Research and development (notes A,M and N)      7,113,258          6,651,471      4,430,819
  General and administrative (note M)            21,879,130         21,407,472     12,884,237
  Amortization  (notes A,F and G)                   804,458            392,307         39,716
  Impairment loss                                       -                  -        5,060,951
                                                -------------    -------------    -------------
                                                 33,084,022         28,805,761     22,563,694
                                                -------------    -------------    -------------
    Loss from operations                        (28,734,104)       (28,459,887)   (22,398,443)

Other income and expense
  Interest income                                  (561,817)          (589,529)    (1,031,560)
  Debt issue costs (note A)                       2,218,066          1,005,000      3,458,300
  Beneficial convertible debt feature(notes A&L)  2,063,915          3,062,500      7,228,296
  Interest expense                                  826,346          1,924,873      1,373,404
  Warrant extensions (note M)                           -            5,233,529      4,669,483
  Loss on unconsolidated subsidiaries(notes A&G)    279,978            158,183            -
  Loss on disposal of assets                         29,759            122,857            376
  Other taxes (note N)                              120,882                -              -
  Unusual item (note J and P)                    (2,562,848)         3,450,000            -
                                                -------------    -------------    -------------
                                                  2,414,281         14,367,413     15,698,299
                                                -------------    -------------    -------------
    Loss before unrelated
      investors' interest                       (31,148,385)       (42,827,300)   (38,096,742)

Unrelated investors' interest in
  net loss of subsidiaries                          206,075            280,997         24,164
                                                -------------    --------------   -------------
  Net loss                                     $(30,942,310)      $(42,546,303)   $(38,072,578)
                                                =============    ==============   =============

  Loss per common share - Basic:
   Net Loss                                    $      (0.02)      $      (0.04)   $      (0.05)
   Less: Preferred stock dividends                    (0.00)             (0.00)          (0.00)
                                                -------------    -------------    -------------
   Net loss attributable to
       common stockholders:                    $      (0.02)      $      (0.04)   $      (0.05)
                                                =============    =============    =============


  Loss per common share - Diluted:
   Net Loss                                    $      (0.02)      $      (0.04)   $      (0.05)
   Less: Preferred stock dividends                    (0.00)             (0.00)          (0.00)
                                                -------------    -------------    -------------
   Net loss attributable to
       common stockholders:                    $      (0.02)      $      (0.04)   $      (0.05)
                                                =============    =============    =============

The accompanying notes are an integral part of these statements.

</TABLE>
<PAGE> F-4
<TABLE>

                           BICO, Inc. and Subsidiaries

              Consolidated Statements of Stockholders' Equity (Deficiency)

<CAPTION>

			  	                                                  Note rec.
                  Preferred Stock  Discount assigned Common Stock                issued for Additional
                  ---------------  to benef. conv.   ------------                Common Stk  Paid in    Accumulated
                 Shares   Amount     feature     Shares     Amount    Warrants  Rel Party   Capital      Deficit      Total
                 ------   ------    ----------   ------     ------    ---------- --------- ----------- -------------- ----------
<S>             <C>      <C>        <C>         <C>        <C>        <C>        <C>      <C>         <C>            <C>
Balance at
 Dec. 31, 1998      -     $    -     $   -       420,773,568 $42,077,357$6,396,994 $(25,000)$92,725,285 $(143,101,880) $(1,927,244)
                 ------- -------     ---------   ----------  ----------  ----------  -------- ----------   ------------ ----------
Proceeds from
 stk offering       -          -         -        19,625,691   1,962,569     -        -        (914,485)           -     1,048,084
Proceeds from
 sale of Preferred
 stk.-Series F    72,000  720,000        -             -           -         -        -          90,000            -       810,000
Conversion of
 debentures         -        -           -       515,013,737  51,501,374     -        -     (19,444,872)           -    32,056,502
Warrants granted
 and extended-
 subsidiaries       -        -           -             -           -         -        -       5,897,332            -     5,897,332
Issuance of
convertible debt    -        -           -             -           -         -        -       7,228,296            -     7,228,296
Repayment of
subscription recv.  -        -           -             -           -         -       25,000         -              -        25,000
Warrants exercised  -        -           -           687,500      68,750    (8,968)   -          26,636            -        86,418
Warrants granted    -        -           -             -         403,135     -        -             -              -       403,135
  Net loss          -        -           -             -           -         -        -             -     (38,072,578) (38,072,578)
                  ------  -------    ---------    ----------  ---------- --------- -------    ---------   -----------   ----------
Balance at
Dec. 31,1999      72,000  720,000        -       956,100,496  95,610,050 6,791,161    -      85,608,192  (181,174,458)   7,554,945
                  ------  -------    ---------    ----------  ---------- --------- -------    ---------   -----------    ---------
Proceeds from
 stk offering       -        -           -       327,615,231  32,761,523     -        -     (14,156,873)           -    18,604,650
Proceeds from
 sale of Preferred
 stk.-Series F   380,000  3,800,000 (1,883,333)        -           -         -        -       2,358,333            -     4,275,000
Constructive div.
 on preferred stk.  -        -       1,883,333         -           -         -        -      (1,883,333)           -          -
Conversion of
 preferred stk.
 Series F       (452,000)(4,520,000)     -        56,679,610   5,667,961     -        -      (1,147,961)           -          -
Conversion of
 debentures         -        -           -        36,294,340   3,629,434     -        -         491,113            -     4,120,547
Warrants
 exercised          -        -           -         4,414,490     441,449  (307,581)   -         481,790            -       615,658
Warrants
 granted and extended
 -subsidiaries      -        -           -             -           -         -        -      11,084,555            -    11,084,555
Issuance of
 convertible debt   -        -           -             -           -         -        -       3,062,500            -     3,062,500
Common stk.
 issued for serv.   -        -           -         2,600,000     260,000     -        -          78,000            -       338,000
Common stk.
 issued-subs.       -        -           -             -           -         -        -         170,780            -       170,780
Warrants granted    -        -           -             -           -       608,655    -            -               -       608,655
Warrants expired    -        -           -             -           -      (888,000)   -         888,000            -          -
  Net loss          -        -           -             -           -         -        -            -      (42,546,303) (42,546,303)
                  ------  -------    -------   -------------  ---------- ---------- -------   ----------   ----------- -----------
Balance at
  Dec. 31, 2000     -    $   -       $   -     1,383,704,167$138,370,417$6,204,235  $ -     $87,035,096 $(223,720,761) $ 7,888,987
                  ------  -------    -------   -------------  ---------- ---------- -------   ----------   ----------- -----------
Proceeds from
 stk offering       -        -           -       769,410,092  76,941,009     -        -     (67,717,009)           -     9,224,000
Preferred stk.
 -Series G        10,530    105,300(1,662,632)         -           -         -        -       6,822,332            -     5,265,000
Preferred stk.
 -Series H         2,000     20,000  (250,000)         -           -         -        -       1,070,000            -       840,000
Preferred stk.
 -Series I         4,000     40,000      -             -           -         -        -       1,960,000            -     2,000,000
Preferred stk.
 -Series J           400      4,000   (50,000)         -           -         -        -         226,000            -       180,000
Constructive
 dividend on
 preferred stock    -         -     1,821,632          -           -         -        -      (1,821,632)           -          -
Conversion of
 debentures         -         -          -       297,516,852  29,751,685     -        -     (19,096,026)           -    10,655,659
Warrants
 granted and extended
 -subsidiaries      -         -          -             -           -         -        -          (1,331)           -        (1,331)
Issuance of
 convertible debt   -         -          -             -           -         -        -       2,058,970            -     2,058,970
Common stk.
 issued-subs.       -         -          -             -           -         -        -         162,500            -       162,500
Warrants granted    -         -          -             -           -        17,420    -         188,252            -       205,672
  Net loss          -         -          -             -           -         -        -            -      (30,942,310) (30,942,310)
                  ------  -------    -------   -------------  ---------- ---------- -------  ----------   -----------  -----------
Balance at
  Dec. 31, 2001     -     $   -     $(141,000) 1,383,704,167$138,370,417$6,204,235  $ -     $87,035,096 $(223,720,761) $ 7,888,987
                  ======  =======    =======   ============= =========== ========== =======  ==========   ===========  ===========


The accompanying notes are an integral part of these statements.
</TABLE>
<PAGE> F-5
<TABLE>



                                              BICO, Inc. and Subsidiaries
                                        Consolidated Statements of Cash Flows
<CAPTION>

                                                                                  Year ended December 31,

                                                                         2001             2000            1999
                                                                      -------------  -------------  -------------
<S>                                                                   <C>            <C>            <C>
Cash flows used by operating activities:
Net loss                                                               $(30,942,310)  $(42,546,303)  $(38,072,578)
   Adjustments to reconcile net loss to net
    cash used by operating activities:
    Depreciation                                                            977,178        689,762        773,696
    Amortization                                                            804,453        392,307         42,149
    Loss on disposal of assets                                               29,759        122,857        177,000
    Loss on unconsolidated subsidiaries                                     279,978        158,183            -
    Unrelated investors' interest in susidiaries                           (206,078)      (280,997)       (24,164)
    Stock issued in exchange for services                                       -          338,000        148,484
    Stock issued in exchange for services by subsidiary                         -          225,000            -
    Debenture interest converted to stock                                       -          120,547        211,503
    Beneficial convertible debt feature                                   2,063,915      3,062,500      7,228,296
    Provision for (recovery of)potential loss on notes receivable          (137,502)      (152,359)        70,253
    Warrants granted                                                         17,420        608,655        403,135
    Warrants granted and extended by subsidiaries                           188,252     11,184,858      5,897,332
    (Decrease)increase in allowance for losses on accounts receivable           -          (20,015)        36,620
    (Increase) in accounts receivable                                      (835,007)       (25,148)        (7,924)
    Decrease in inventories                                               1,303,127        101,480         90,052
    (Decrease) in inventory valuation allowance                          (1,688,699)      (859,283)       (25,845)
    (Increase) in prepaid expenses                                          (67,547)      (651,305)       (21,702)
    (Increase) decrease in other assets                                    (113,051)        33,834       (146,408)
    Increase (decrease) in accounts payable                               4,176,925       (296,657)      (949,578)
    Increase in other liabilities                                           820,451      1,112,211        697,726
    Debt forgiveness                                                     (2,562,848)           -              -
    Impairment loss                                                             -              -        5,060,951
                                                                       -------------  -------------  -------------
      Net cash flow used by operating activities                        (25,891,584)   (26,681,873)   (18,411,002)
                                                                       -------------  -------------   -------------
Cash flows from investing activities:
  Purchase of property, plant and equipment                              (1,542,038)    (1,388,508)      (641,371)
  Disposal of property, plant and equipment                                     -              -          175,000
  Acquisitions, net of cash acquired                                            -       (1,395,126)           -
  (Increase) in notes receivable                                         (1,429,041)    (1,939,073)      (337,928)
  Payments received on notes receivable                                     383,716        378,817        141,974
  (Increase) in interest receivable                                         (97,102)       (32,756)       (25,774)
  Purchase of marketing rights                                           (1,285,000)           -              -
  Acquisition of unconsolidated subsidiaries                             (1,093,948)    (2,078,520)      (525,000)
                                                                        -------------  -------------  -------------
    Net cash used by investing activites                                 (5,063,413)    (6,455,166)    (1,213,099)
                                                                        -------------  -------------  -------------

Cash flows from financing activities:
  Proceeds from stock offering                                           10,677,600     18,604,650        900,000
  Proceeds from warrants exercised                                              -          615,658         86,018
  Proceeds from sale of preferred stock                                   6,285,000      4,275,000        810,000
  Redemption of stock subscriptions                                      (1,453,600)           -              -
  Proceeds from debentures payable                                        8,255,659     12,250,000     33,150,000
  Payments on debentures payable                                                -       (5,850,000)    (4,130,000)
  Payments on notes payable and long-term debt                          (14,408,087)       (53,125)      (465,650)
  Increase in notes payable and long-term debt                           14,120,502        855,801         75,396
  Payments on capital lease obligations                                     (98,789)      (543,769)       (99,777)
                                                                       -------------  -------------   -------------
      Net cash provided by financing activities                          23,378,285     30,154,215     30,325,987
                                                                       _____________  _____________   _____________

      Net increase (decrease) in cash                                    (7,576,712)    (2,982,824)    10,701,886

  Cash and cash equivalents, beginning of year                            7,844,807     10,827,631        125,745
                                                                       -------------  -------------   -------------
  Cash and cash equivalents, end of year                               $    268,095   $  7,844,807   $ 10,827,631
                                                                       =============  =============  =============

The accompanying notes are an integral part of these statements.
</TABLE>
<PAGE>F-6
<TABLE>

                                            BICO, Inc. and Subsidiaries
                                        Consolidated Statements of Cash Flows
                                                     (Continued)

<CAPTION>
                                                                                Year ended December 31,
                                                                         2001            2000             1999
                                                                     -------------   -------------   -------------
<S>                                                                  <C>             <C>             <C>
Supplemental Information:
           Interest paid                                              $    412,239    $ 1,485,286     $    966,713
                                                                      =============   ============    ============

Supplemental schedule of non-cash
investing and financing activities:

Acquisition of ICTI with note payable                                 $       -        $       -      $       -
                                                                      =============     ==========    ============
Acquisition of property under a capital lease:
           Land                                                       $       -        $   112,500    $       -
           Building                                                           -          1,321,566            -
                                                                      -------------     ----------    ------------
                                                                      $       -        $ 1,434,066    $       -
                                                                      =============     ==========    ============
Capital Lease Termination
           Reduction of capital lease obligation                      $       -        $       -      $       -
                                                                      =============     ==========    ============
           Reduction of property
                Construction in progress                              $       -        $       -      $       -
                Land                                                          -                -              -
                                                                      -------------     -----------   -------------
                                                                      $       -        $       -      $       -
                                                                      =============     ===========   ==============

Conversion of preferred stock for common stock                        $       -        $ 5,580,168    $       -
                                                                      =============  =============    ============
Preferred stock dividend paid in common stock                         $       -        $   121,825    $       -
                                                                      =============  =============    ============
Constructive dividend on convertible preferred stock                  $ 1,821,632      $ 1,883,333    $       -
                                                                      =============  =============    ============
Conversion of debentures for common stock                             $10,655,659      $ 4,000,000    $ 31,845,000
                                                                      =============  =============    ============
Conversion of stock subscriptions for common stock                    $ 9,900,000      $      -       $       -
                                                                      =============  =============    ============
Preferred stock issued in payment of long term debt                   $ 2,000,000      $      -       $       -
                                                                      =============  =============    ============
Acquisition of marketing rights for note payable                      $ 5,715,000      $      -       $       -
                                                                      =============  =============    ============

The accompanying notes are an integral part of these statements.
</TABLE>

                     BICO, Inc. and Subsidiaries

           NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
                  December 31, 2001, 2000 and 1999

NOTE A - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING
          POLICIES

1.   Organization

     BICO, Inc. (the Company) and its subsidiaries are engaged  in
     the  development, manufacturing and marketing  of  biomedical
     products and biological remediation products.  In June  2000,
     the Company changed its name from Biocontrol Technology, Inc.
     to BICO, Inc.

2.   Principles of Consolidation

     The  consolidated financial statements include  the  accounts
     of: Diasense, Inc., a 52% owned subsidiary as of December 31,
     2001 and 2000; Petrol Rem, Inc., a 75% owned subsidiary as of
     December  31,  2001  and 2000; ViaCirq, Inc.  (formerly  IDT,
     Inc.),  a  99% owned subsidiary as of December 31,  2001  and
     2000;  ViaTherm, Inc., a 99% owned subsidiary as of  December
     31,  2001;  Ceramic Coatings Technologies, Inc., a 98%  owned
     subsidiary  as  of  December  31,  2001  and  2000  and  B-A-
     Champ.com, Inc., a 99.8% owned subsidiary as of December  31,
     2001  and  a  51% owned subsidiary as of December  31,  2000.
     Also  included  in the consolidated financial statements  are
     the   accounts  of  the  following  subsidiaries  which   are
     inactive: International Chemical Technologies, Inc., a  58.4%
     owned  subsidiary  as  of December  31,  2001  and  2000  and
     Barnacle  Ban  Corporation, a 100%  owned  subsidiary  as  of
     December  31,  2001  and  2000. All significant  intercompany
     accounts  and transactions have been eliminated.   Subsidiary
     losses  in  excess of the unrelated investors'  interest  are
     charged  against  the  Company's interest.   Changes  in  the
     Company's  proportionate share of subsidiary equity resulting
     from  the  additional  equity raised by  the  subsidiary  are
     accounted for as equity transactions in consolidation with no
     gain  recognition  due  to  the  development  stage  of   the
     subsidiaries   and  uncertainty  regarding  the  subsidiary's
     ability to continue as a going concern.

     Some   of   our   consolidated  subsidiaries   also   include
     consolidated  subsidiaries of their  own.  Petrol  Rem,  Inc.
     consolidated  financial statements include  the  accounts  of
     INTCO,  Inc., a 51% owned subsidiary as of December 31,  2001
     and  2000; and Tireless, Inc., a 51% owned subsidiary  as  of
     December  31, 2001 and 2000. B-A-Champ.com, Inc. consolidated
     financial  statements include the accounts of TruePoints.com,
     Inc.,  a  100% owned subsidiary as of December 31,  2001  and
     2000.

3.   Cash and Cash Equivalents

     For  purposes  of  the statement of cash flows,  the  Company
     considers  all highly liquid investments with a  maturity  of
     three  months  or less at acquisition to be cash equivalents.
     Included in cash and equivalents is a $50,000 certificate  of
     deposit  which  is  pledged  as  collateral  to  secure   the
     Company's corporate credit cards.

4.   Inventory

     Inventory is valued at the lower of cost (first-in, first-out
     method)  or  market.   An  inventory valuation  allowance  is
     provided  against  finished  goods  and  raw  materials   for
     products for which a market has not yet been established.

5.   Property and Equipment

     Property  and  equipment  are  recorded  at  cost   and   are
     depreciated over their estimated useful lives, ranging from 3
     to  39  years,  on  a straight-line basis.   Amortization  of
     assets  recorded  under  capital  leases  is  included   with
     depreciation expense.  Impairment losses are recognized  when
     management determines that operating conditions raise  doubts
     about the ability to recover the carrying value of particular
     assets.   The  amount  of impairment loss  is  determined  by
     comparing  the  present  value of the estimated  future  cash
     inflows of such assets to their net carrying value.

6.   Goodwill

     Goodwill,  which  represents the  excess  cost  of  purchased
     companies over the fair value of their net assets at dates of
     acquisition, is amortized on a straight-line basis over  five
     years.   Goodwill  associated with assets  determined  to  be
     impaired is correspondingly written down.  With the Company's
     implementation of newly issued accounting standards effective
     January  1, 2002, goodwill will no longer be amortized.   See
     Note A, number 20 below.

7.   Investment in Unconsolidated Subsidiaries

     During  2000  and  2001,  the  Company  made  investments  in
     unconsolidated subsidiaries (see Note G).  These  investments
     are  being  reported on the equity basis due to the Company's
     ownership  percentage, options to purchase additional  shares
     and   membership   on  the  boards  of  directors   of   each
     unconsolidated  subsidiary  as  discussed  in  Note  G.   The
     difference  between  the amount invested and  the  underlying
     equity in the unconsolidated subsidiary's net assets is being
     amortized  as  goodwill  over  a  5-year  period.   With  the
     Company's implementation of newly issued accounting standards
     effective  January  1,  2002,  goodwill  will  no  longer  be
     amortized.  See Note A, number 20 below.

8.   Loss Per Common Share

     Net  loss per common share is based upon the weighted average
     number of common shares outstanding.  The loss per share does
     not  include common stock equivalents since the effect  would
     be   antidilutive.   The  weighted  average  shares  used  to
     calculate  the  loss per share amounted to  1,952,313,675  in
     2001, 1,037,254,759 in 2000 and 695,400,191 in 1999.  The net
     losses  attributable  to common shareholders  for  the  years
     ended  December  31,  2001, 2000 and 1999  were  $32,763,942,
     $44,429,636  and  $38,072,578,  respectively,  which  include
     constructive   dividends   to   preferred   stockholders   of
     $1,821,632, $1,883,333 and $0, respectively.

9.   Research and Development Costs

     Research  and development costs are charged to operations  as
     incurred.     Machinery,   equipment   and   other    capital
     expenditures,  which  have  alternative  future  use   beyond
     specific research and development activities, are capitalized
     and depreciated over their estimated useful lives.

10.  Income Taxes

     The   Company   previously  adopted  Statement  of   Financial
     Accounting Standards No. 109 (FAS 109), Accounting for  Income
     Taxes,  which  requires  the asset  and  liability  method  of
     accounting for income taxes.  Enacted statutory tax rates  are
     applied  to temporary differences arising from the differences
     in  financial statement carrying amounts and the tax bases  of
     existing assets and liabilities. Due to the uncertainty of the
     realization  of income tax benefits (Note M), the adoption  of
     FAS  109  had  no  effect on the financial statements  of  the
     Company.

11.  Interest

     No  interest  was capitalized as a component of  the  cost  of
     property,  plant  and equipment constructed for  its  own  use
     during the years ended December 31, 2001, 2000 or 1999.

12.  Estimates and Assumptions

     The  preparation  of financial statements in  conformity  with
     generally  accepted accounting principles requires  management
     to  make  estimates and assumptions that affect  the  reported
     amounts of assets and liabilities and disclosure of contingent
     assets and liabilities at the date of the financial statements
     and  the reported amounts of revenues and expenses during  the
     reporting  period.   Actual results could  differ  from  those
     estimates.  The Company has established allowances based  upon
     management's  evaluation of inventories, accounts  receivable,
     and  receivables from related parties and amortizes intangible
     assets  such  as  goodwill and patents over  estimated  useful
     lives.

13.  Common Stock Warrants

     The  Company  recognizes cost on warrants granted or  extended
     based  upon the minimum value method.  Under this method,  the
     warrants  are valued by reducing the current market  price  of
     the  underlying  shares by the present value of  the  exercise
     price  discounted, at an estimated risk-free interest rate  of
     5%  and  assuming  no  dividends.  The value  of  warrants  is
     recalculated  when warrants are extended and any  increase  in
     value  over  the  value recorded at the time the  warrant  was
     granted is recognized at the time the warrant is extended.

14.  Debt Issue Costs

     The  Company follows the policy of expensing debt issue  costs
     on  debentures when debentures are issued.  Total  debt  issue
     costs  incurred for the periods ended December 31, 2001,  2000
     and   1999   were   $2,218,066,  $1,005,000  and   $3,458,300,
     respectively.

15.  Concentration of Credit Risk

     Financial  instruments, which potentially subject the  Company
     to   significant  concentrations  of  credit   risk,   consist
     principally   of   cash  investments  at   commercial   banks,
     receivables  from  officers  and  directors  of  the  Company,
     investments   in  unconsolidated  subsidiaries  and   accounts
     receivable  from two customers, which represent  over  90%  of
     consolidated  accounts receivable.  Cash and cash  equivalents
     are  temporarily  invested  in interest  bearing  accounts  in
     financial institutions, and such investments may be in  excess
     of  the FDIC insurance limit.  Receivables from directors  and
     officers  of  the  Company (Notes C and O) are  unsecured  and
     represent  a  concentration of credit risk due to  the  common
     employment  and  financial dependency of these individuals  on
     the Company.  The company has reviewed the creditworthiness of
     its  significant  customers and does not  expect  to  incur  a
     significant loss for uncollected accounts.

16.  Comprehensive Income

     The  Company's consolidated net income (loss) is the same  as
     comprehensive  income  to  be disclosed  under  Statement  of
     Financial Accounting Standards No. 130.

17.  Beneficial Convertible Debt Feature

     Beneficial   conversion  terms  included  in  the   Company's
     convertible debentures are recognized as expense and credited
     to  additional  paid  in capital at the time  the  associated
     debentures are issued.

18.  Beneficial Conversion Feature of Preferred Stock

     The  Company's  4%  convertible preferred  stock  includes  a
     beneficial   conversion  feature  providing   the   preferred
     stockholder  a  discount  upon conversion  to  the  Company's
     common stock after a specified number of days.  The value  of
     this  beneficial conversion feature is determined by reducing
     the  market  price  of  the Company's  common  stock  by  the
     discounted conversion price on the date of commitment.   This
     discount  is recognized as a discount assigned to  beneficial
     conversion feature and is amortized as constructive dividends
     to  the  preferred  stockholders over  the  period  prior  to
     conversion using the effective interest method.

19.  Advertising Costs

     Advertising costs are charged to operations when incurred.
     Advertising expenses for 2001, 2000 and 1999 were $367,867,
     $208,617 and $4,851, respectively.

20.  Impact of Recently Issued Accounting Standards

     In  June  2001,  the  Financial  Accounting  Standards  Board
     ("FASB")  issued Statement of Financial Accounting  Standards
     No.  141,  "Business Combinations."  SFAS 141 supersedes  APB
     Opinion  No.  16 and FASB Statement No. 38 and requires  that
     all business combinations be accounted for using the purchase
     method.   The  provisions  of this  statement  apply  to  all
     business  combinations initiated after June  30,  2001.   The
     Company  is  in the process of assessing the impact  of  this
     pronouncement on its financial statements.

     Also  in  June  2001, the FASB issued Statement of  Financial
     Accounting  Standards No. 142, "Goodwill and Other Intangible
     Assets."   SFAS  142  supersedes  APB  Opinion  No.  17   and
     addresses  financial  accounting and reporting  for  acquired
     goodwill  and other intangible assets.  Under this provision,
     goodwill  and  certain intangible assets will  no  longer  be
     amortized.   These  assets will be evaluated  on  a  periodic
     basis  to  determine  if  an  impairment  loss  needs  to  be
     recorded.  The provisions of this statement will be effective
     for  the Company's fiscal year ending December 31, 2002.  The
     Company  is  in the process of assessing the impact  of  this
     pronouncement on its financial statements.


NOTE B  - OPERATIONS AND LIQUIDITY

     The  Company  and its subsidiaries have incurred  substantial
     losses  in  2001  and in prior years and  have  funded  their
     operations and product development through the sale of common
     and  preferred stock and issuance of debt instruments.  Until
     such  time  that products can be successfully  developed  and
     marketed,  the Company and its subsidiaries will continue  to
     need to fulfill working capital requirements through the sale
     of  stock and issuance of debt.  The inability of the Company
     to  continue  its operations as a going concern would  impact
     the  recoverability  and  classification  of  recorded  asset
     amounts.

     The  ability  of  the  Company to continue  in  existence  is
     dependent  on  its having sufficient financial  resources  to
     complete   the   research   and  development   necessary   to
     successfully  bring  products to market and  for  marketplace
     acceptance.  As a result of its significant losses,  negative
     cash   flows  from  operations  and  significant  accumulated
     deficits  for each of the periods ending December  31,  2001,
     2000,  and  1999,  there  is  substantial  doubt  about   the
     Company's ability to continue as a going concern.

     In  order  to  meet  its  projected  expenditures  for  2002,
     Management  believes that additional funds will  need  to  be
     raised  from  sales  of stock and future debt  issuance.   As
     discussed  in  NOTE  S,  Management  secured  commitments  to
     provide  such  funding  during the  first  quarter  of  2002.
     Management  believes that these financing  commitments  along
     with   a  plan  to  reduce  operating  expenses,  to  curtail
     investment  activities and to dispose of certain subsidiaries
     (Note  S)  will  provide the opportunity for the  Company  to
     continue as a going concern.

NOTE C - NOTES RECEIVABLE

     Notes  receivable  due  from various  related  and  unrelated
     parties consisted of:

                                     Dec. 31, 2001      Dec. 31, 2000

  Related Parties


  Note receivable from Allegheny
  Food Services, Inc. of which
  Joseph Kondisko, a former
  director, is principal owner,
  payable in monthly installments        $ 24,394       $ 87,706
  of $3,630, including interest at
  9.25%.  The balance is due and
  payable at December 31, 2001.

  Note Receivable from Anthony J.
  DelVicario, a former director of
  Diasense, Inc. and president of
  American Inter-Metallics, Inc.,
  dated November 9, 2001 in the
  amount of $114,000 payable on           114,000           -
  demand with interest at prime
  rate plus 2%.  The note is
  collateralized by the assets of
  American Inter-Metallics, Inc.

  Note receivable from Fred E.
  Cooper, Chief Executive Officer,
  dated April 28, 1999, in the
  amount of $777,400, payable in
  monthly installments of $9,427          671,338        715,693
  with a final balloon payment on
  May 31, 2002.  Interest is
  accrued at a rate of 8% per
  annum.

  Note receivable from Glenn
  Keeling, Director, dated April
  28, 1999, in the amount of
  $296,358, payable in monthly
  installments of $4,184 with a           146,332        237,737
  final balloon payment on May 1,
  2002.  Interest is accrued at a
  rate of 8% per annum.

  Note Receivable from T.J. Feola,
  Director, dated April 28, 1999,
  in the amount of $259,477,
  payable in monthly installments
  of $3,676 with a final balloon          195,623        221,308
  payment on May 31, 2002.
  Interest is accrued at a rate of
  8% per annum.

  Demand note receivable from
  Joseph A. Resnick, an employee,          23,000           -
  payable upon demand with 8.75%
  interest.

  Unrelated Parties

  Demand note receivable from
  Practical Environmental
  Solutions, Inc. on a $3,150,000
  line of credit agreement.
  Principal plus interest accrued
  at a rate of 10% per annum is
  payable upon demand on or before
  May 31, 2002.  The loan is
  collateralized by a security
  interest and lien on all of
  Practical Environmental
  Solutions' assets including its
  rights to any and all contracts,
  options or claims of that company
  to purchase or acquire the assets     3,148,404      1,914,363
  of any environmental company.
  The note is classified as a
  noncurrent asset as of December
  31, 2001 because the management
  of Petrol Rem is considering
  converting all or part of this
  note into a controlling equity
  interest in Practical
  Environmental Solutions with the
  balance of the note being
  converted to a term loan.

  Note receivable from an
  individual, due on November 15,
  2002 with interest at prime plus        111,041        200,000
  2% (6.75% at December 31, 2001).

  Note receivable from an
  individual, payable upon                   -            12,000
  demand with 8.75% interest.
                                       ----------    -----------
                                        4,434,132      3,388,807


  Less current notes receivable           138,394      2,014,069
                                       ----------    -----------
  Noncurrent                           $4,295,738    $ 1,374,738
                                       ==========    ===========

     Accrued interest receivable on the related party notes as  of
     December   31,   2001and  2000  was  $16,092   and   $13,463,
     respectively.

     Due  to  the  financial dependency of the above officers  and
     directors  on  the Company, an allowance of   $1,050,699  and
     $1,188,201  has  been provided as of December  31,  2001  and
     2000, respectively.

     In  April  2001,  the  Company loaned $70,000  to  Pascal  M.
     Nardelli,  President and Chief Executive  Officer  of  Petrol
     Rem,  Inc.  In  August  2001, this demand  note  and  accrued
     interest of $2,110 were paid in full.

NOTE D - INVENTORY

     Inventories consisted of the following as of:

                                Dec. 31, 2001          Dec. 31, 2000


          Raw materials          $  543,354             $ 2,699,527

          Work in Process           341,226                 512,526

          Finished goods          2,111,439               1,087,093
                                  ---------               ---------
                                  2,996,019               4,299,146

          Less valuation         (1,805,223)             (3,493,922)
          allowance               ---------               ---------

                                 $1,190,796             $   805,224
                                  =========               =========

NOTE E - PREPAID EXPENSES

     Prepaid expenses consisted of the following as of:

                                 Dec. 31, 2001      Dec. 31, 2000


      Prepaid insurance          $  330,761         $  304,229

      Prepaid professional fees     612,813            234,961

      Prepaid debt issue costs             -           220,000

      Employee advances              47,297             32,549

      Prepaid taxes                  22,642             31,200

      Security deposits               4,428             14,799

      Other prepaid expenses         37,960            150,616
                                 ----------          ---------
                                 $1,055,901         $  988,354
                                 ==========          =========

NOTE F - INTANGIBLE ASSETS

     In June 2001, the Company entered into a marketing agreement with
     GAIFAR,  a  German company that owned all the rights  to  certain
     rapid  HIV  tests, and Dr. Heinrich Repke, the man who  developed
     the  tests.   The  marketing rights were assigned  to  Rapid  HIV
     Detection  Corp,  of which the Company owns 75% and  GAIFAR  owns
     25%.   GAIFAR  retained the manufacturing rights for  the  tests.
     The  agreement,  as amended, provided for a due diligence  period
     until  October  15, 2001 and approval by the Company's  board  of
     directors.   In  October  2001,  the  due  diligence  period  was
     completed  and  the  Company's  board  provided  their  unanimous
     resolution, making the marketing agreement fully effective.   The
     marketing  agreement has a minimum ten-year term  and  calls  for
     total  payments of $7,000,000 through the third quarter of  2002.
     The entire $7,000,000 was recorded as an intangible asset with  a
     corresponding  amount  payable to  GAIFAR.   When  the  marketing
     agreement became effective in October 2001, $1,025,000 previously
     loaned to GAIFAR was applied to the $7 million owed to GAIFAR for
     the  marketing rights.  The original agreement called for a  loan
     of  $500,000  to the owner of the rapid HIV tests and technology,
     but the Company agreed to loan another $125,000 during the second
     quarter while the due diligence was continuing.  During the third
     quarter, the Company loaned an additional $400,000 while the  due
     diligence  was  completed.   These payments  to  GAIFAR  totaling
     $1,025,000  were made part of the consideration paid  to  acquire
     the  exclusive worldwide marketing rights to the rapid HIV  tests
     and technology and are now part of the Company's investment in
     Rapid HIV Detection Corp. An additional  $260,000  was paid to
     GAIFAR  during  the  fourth quarter  of 2001 reducing the amount
     due to GAIFAR to $5,715,000,  which  is included in the current
     portion of long-term debt (note K). The remaining payments are due
     in monthly amounts ranging from  $125,000  to  $1,000,000  through
     August  20,  2002.   The marketing rights are being amortized as an
     intangible asset over the ten-year minimum term of  the   marketing
     agreement.  Amortization of $133,602 was recognized during 2001.

NOTE G - INVESTMENT IN UNCONSOLIDATED SUBSIDIARIES

     During the year ended December 31, 2001, the Company invested
     an  additional $10,000 in Insight Data Link.com, Inc.  (IDL),
     an  unconsolidated subsidiary interest initially acquired  in
     2000.   With  this  additional investment,  the  Company  has
     invested  $110,000  in  IDL and its ownership  percentage  is
     approximately  27%.   Insight is a  Pennsylvania  corporation
     formed  to  engage in the business of acting as  an  internet
     clearinghouse  for  persons seeking to acquire,  and  persons
     having  available, shopping mall space, as well  as  software
     development for related projects.

     Also  during  the  year ended December 31, 2001  the  Company
     invested  an additional $190,000 in American Inter-Metallics,
     Inc.  ("AIM") an unconsolidated subsidiary interest initially
     acquired  during 1999.  With this additional investment,  the
     Company  owns  20% of AIM.  AIM has its operations  in  Rhode
     Island, and is developing a product that enhances performance
     in rockets and other machinery by increasing the burn rate of
     propellants.

     During the year ended December 31, 2001, Diasense invested an
     additional  $600,000 in Microislet, Inc.,  an  unconsolidated
     subsidiary  interest initially acquired  during  2000.   With
     this  additional investment, Diasense has invested $1,600,000
     in  Microislet  and  its  ownership is  approximately  20.2%.
     Diasense  holds  a  seat on the board of  directors  of  this
     unconsolidated  subsidiary.   MicroIslet  is   a   California
     company,   which  has  licensed  several  diabetes   research
     technologies  from Duke University with a specific  focus  on
     optimizing microencapsulated islets for transplantation.

     Also  during  the  year  ended December  31,  2001,  Diasense
     invested  an additional $293,948 in Diabecore Medical,  Inc.,
     an  unconsolidated  subsidiary  interest  initially  acquired
     during  2000.  With this additional investment, Diasense  has
     invested $987,468 in Diabecore and owns approximately 24%  of
     this unconsolidated subsidiary.  Diasense holds a seat on the
     board  of  directors of Diabecore.  Diabecore is  a  Toronto-
     based  company  working  to develop a  new  insulin  for  the
     treatment of diabetes.

     These investments are being reported on the equity basis  and
     differences  between the investment and  the  underlying  net
     assets of the unconsolidated subsidiaries are being amortized
     as goodwill over a 5-year period.

     The  Company's  investment in the underlying assets  and  the
     unamortized goodwill of each unconsolidated subsidiary as  of
     December 31, 2001 and December 31, 2000 are as follows:


                      Investment in
Unconsolidated        Underlying Net      Unamortized
  Subsidiary             Assets             Goodwill               Total
                       2001     2000       2001     2000        2001     2000
American Inter-
Metallics, Inc.    $  318,200 $222,912  $ 394,300  $441,004 $ 712,500 $  663,916
Insight Data Link.com  22,876   28,503     41,629    52,546    64,505     81,049
MicroIslet, Inc.      130,477   50,731    786,874   688,508   917,351    739,239
Diabecore Medical,Inc 158,935   50,615    556,552   526,620   715,487    577,235
                    _________ ________  _________ _________ __________  ________
Total              $  630,488 $352,761 $1,779,355$1,708,678$2,409,843 $2,061,439
                    ========= ========  ========= ========= ========== =========


The  amounts  recognized  as amortization of  goodwill and loss  on
unconsolidated subsidiaries for each investment for the  years  ended
December 31, 2001 and 2000 are as follows:
                                                      Loss
   Unconsolidated         Amortization                 on
     Subsidiary            of Goodwill            Unconsolidated
                                                   Subsidiaries

                           2001     2000         2001        2000

American Inter-
Metallics, Inc.        $ 141,416  $106,369    $    -       $    -

Insight Data              13,770    13,136      (12,774)      (5,815)
Link.com

MicroIslet, Inc.         188,525   152,628     (233,363)    (108,133)

Diabecore Medical, Inc.  121,855    72,049      (33,841)     (44,235)
                       ---------   -------     ---------     --------
Total                  $ 465,566  $344,182    $(279,978)   $(158,183)
                       =========   =======     =========     ========

NOTE H- BUSINESS SEGMENTS

The   Company  operates  in  two  reportable  business   segments:
Biomedical  devices, which includes the operations of BICO,  Inc.,
Diasense,  Inc.  and  ViaCirQ,  Inc.  and  Bioremediation,   which
includes  the  operations  of  Petrol  Rem,  Inc.   Following   is
summarized  financial  information for  the  Company's  reportable
segments:


                             Biomedical
2001                          Devices  Bioremedication  All Other  Consolidated
Sales to external customers $   817,353  $3,383,637     $ 141,213  $ 4,342,203
Cost of products sold           558,408   2,507,717       221,051    3,287,176
Gross profit (loss)             258,945     875,920       (79,838)   1,055,027
Identifiable assets          17,414,784   6,515,188       642,095   24,572,067
Capital expenditures            930,012     512,887        99,139    1,542,038
Depreciation and amortization 1,302,037     350,688        56,355    1,709,080
Interest Income                 259,928     301,889             0      561,817
Interest Expense                737,972      11,329        77,045      826,346


                             Biomedical
2000                          Devices  Bioremedication  All Other  Consolidated
Sales to external customers  $    81,954 $  217,722     $   40,651  $   340,327
Cost of products sold             47,862    179,446        127,203      354,511
Gross profit (loss)               34,092     38,276       (86,552)     (14,184)
Identifiable assets           16,628,619  4,385,100        835,589   21,849,308
Capital expenditures           2,788,454          0         34,120    2,822,574
Depreciation and amortization    979,083     74,120         43,198    1,096,401
Interest Income                  543,457     46,072              0      589,529
Interest Expense               1,811,665          0        113,208    1,924,873


1999
Sales to external customers  $    82,056 $   26,693     $    3,599  $   112,348
Cost of products sold            133,288     14,683              0      147,971
Gross profit(loss)              (51,232)     12,010          3,599      (35,623)
Identifiable asset            15,018,258    226,760        440,818   15,685,836
Capital expenditures             262,954          0        378,417      641,371
Depreciation and amortization  5,108,855     34,351         96,060    5,239,266
Interest Income                1,031,560          0              0    1,031,560
Interest Expense               1,373,404          0              0    1,373,404




NOTE I - ACCRUED LIABILITIES

     Accrued liabilities consisted of the following as of:

                                   Dec. 31, 2001    Dec. 31, 2000


      Accrued interest           $     176,080       $ 1,120,655
      Accrued payroll                1,488,748           373,821
      Accrued payroll taxes and         14,815            24,303
        withholdings
      Accrued vacation                  65,446            66,445
      Accrued class action             425,000         1,300,000
        settlement (note O)
      Deferred revenue                 173,516            21,633
      Accrued income taxes             140,827            43,780
      Other accrued liabilities         84,094           181,128
                                   -----------        ----------
                                 $   2,568,526       $ 3,131,765
                                   ===========        ==========

NOTE J - DEBT OBLIGATIONS

Notes payable consisted of the following as of:

                                                Dec. 31,       Dec. 31,
                                                  2001           2000


Note Payable in connection with a Settlement
Agreement and Mutual Release related to  the
outstanding  amounts owed for the  Company's
stock  purchase agreement for 58.4% interest
in International Chemical Technologies, Inc.    500,000             -
(ICTI).  The note bears interest at  a  rate
of  10%  per  annum and is  payable  in  ten
monthly installments from January to October
2002.

Commercial  Premium  Finance  Agreement   of
Intco,  Inc., a 51% owned subsidiary of  the
Company's   subsidiary,  Petrol  Rem,   Inc.
Amounts   are   payable  in   nine   monthly       -              66,210
installments  of $11,342 including  interest
at  9.47%  per  annum beginning  October  1,
2000.

Commercial  Premium  Finance  Agreement   of
Intco,  Inc., a 51% owned subsidiary of  the
Company's   subsidiary,  Petrol  Rem,   Inc.
Amounts   are   payable  in   nine   monthly     79,016             -
installments  of $13,534 including  interest
at  9.45%  per  annum beginning  October  1,
2001.

Note  Payable  by the Company's  subsidiary,
Petrol  Rem,  Inc., in connection  with  the
stock purchase agreement for 51% interest in
Intco,  Inc.   The  note is payable  without
interest in installments as follows:  (i) on       -             850,000
the  first  day of each calendar month  from
January 1, 2001 through and including  April
1, 2001, a principal payment of $150,000 and
(ii)  $250,000 on May 1, 2001.

Promissory  Note  payable  to  the  minority
owner of Intco, Inc., a 51% owned subsidiary
of  the  Company's subsidiary,  Petrol  Rem,
Inc.   The loan is collateralized by  Petrol    500,000             -
Rem's 51% ownership in Intco.  Principal and
interest  at  7% per annum are payable  upon
demand

Note Payable in connection with the purchase
of  marketing rights for certain  rapid  HIV
tests.   The  note  is  payable  in  various  5,715,000             -
monthly  installments ranging from  $125,000
to $1,000,000 per month through August 2002

Commercial Premium Finance Agreement payable
in  nine  monthly  installments  of  $11,492     89,187             -
including   interest  at  8.15%  per   annum
beginning December 9, 2001.

Commercial Premium Finance Agreement payable
in  nine  monthly  installments  of  $15,878    108,630             -
including   interest  at  6.9%   per   annum
beginning November 1, 2001.

Commercial Premium Finance Agreement payable
in  eight  monthly installments  of  $13,208       -             77,317
including   interest  at  8.5%   per   annum
beginning December 1, 2000.

Commercial Premium Finance Agreement payable
in   nine  monthly  installments  of  $9,903       -             75,600
including  interest  at  12.63%  per   annum
beginning December 10, 2000.

$50,000 line of credit with PNC Bank.  The
outstanding balance bears interest at a
rate of 6.75% per annum.                         45,365             -
                                              ----------      --------
Note payable                                 $7,037,198      $1,069,127
                                              ==========      =========

During   the  year  ended  December  31,  2001,  the  Company  issued
promissory notes totaling $11,715,000.  As of December 31, 2001,  all
of  these promissory notes totaling $11,715,000 had been repaid  with
proceeds  from  the sale of common stock subscriptions and  preferred
stock.

Long-term debt consisted of the following as of:

                                                Dec. 31,       Dec. 31,
                                                 2001           2000


Note   Payable  in  connection  with   stock
purchase  agreement for  58.4%  interest  in
International  Chemical  Technologies,  Inc.
(ICTI).  The note bears interest at  a  rate
of  10%  per annum and is collateralized  by
the   shares  of  ICTI  purchased   in   the
transaction.   At  December  31,  2000,  the   $   -         $ 2,900,000
Company was in default on the terms of  this
loan and the note holder had made demand for
payment.   Accordingly, the  unpaid  balance
was classified as due and payable.  In 2001,
the   Company  finalized  an  agreement  for
payment of this note.

Note  Payable  by the Company's  subsidiary,
International  Chemical  Technologies,  Inc.
(ICTI),  to  it's  former shareholder.   The
loan  bears interest at a rate of  9.5%  per
annum  and is guaranteed by the Company  and
collateralized   by   all    tangible    and
intangible assets of ICTI, and assignment of
ICTI's   interest  in  its  lease  for   its       -           1,191,667
production  facilities.   At  December   31,
2000,  the  Company was in  default  on  the
terms  of this loan and the note holder  had
made  demand for payment.  Accordingly,  the
unpaid  balance was classified  as  due  and
payable.  In 2001, the Company finalized  an
agreement  for  payment of  this  note   See
further discussion of this  agreement  later
in this note.

Promissory Note of Intco, Inc., a 51%  owned
subsidiary   of  the  Company's  subsidiary,
Petrol Rem, Inc.  The loan is collateralized
by certain Intco equipment.
Principal and interest at 9.5% per annum are      3,503           20,351
payable in 25 equal monthly installments  of
$1,500  each  commencing February  27,  2000
with   a  final  payment  of  all  remaining
principal  and  interest due  on  March  27,
2002.

Promissory Note of Intco, Inc., a 51%  owned
subsidiary   of  the  Company's  subsidiary,
Petrol Rem, Inc.  The loan is collateralized
by certain Intco equipment.
Principal  and interest at 9% per annum  are
payable on demand or, if no demand is  made,      3,602            7,263
in  35  equal monthly installments  of  $320
each  commencing February 25,  2000  with  a
final payment of all remaining principal and
interest due on February 25, 2003.

Promissory Note of Intco, Inc., a 51%  owned
subsidiary   of  the  Company's  subsidiary,
Petrol Rem, Inc.  The loan is collateralized
by certain Intco equipment.
Principal  and interest at 7.75%  per  annum
are  payable on demand or, if no  demand  is     12,285             -
made,  in  47 equal monthly installments  of
$325 each commencing October 10, 2001 with a
final payment of all remaining principal and
interest due on September 10, 2005.

Term  Loan  of Tireless, Inc., a  51%  owned
subsidiary   of  the  Company's  subsidiary,
Petrol Rem, Inc.  The loan is collateralized
by certain Tireless assets.                     194,444             -
Principal  and interest at prime  rate  plus
2.5%  per  annum are payable in  36  monthly
installments  of $5,556 each  plus  interest
commencing December 1, 2001.


Note  Payable to a bank in monthly  payments
of  $433  including interest  at  8.75%  per        363           2,239
annum.    The  loan  in  collateralized   by
equipment.                                    ----------      ----------
                                                214,197       4,121,520

Current portion of long-term debt                86,420       4,113,656
                                              ----------      ----------
Long-term debt                               $  127,777     $     7,864
                                              ==========      ==========

     As  of  December 31, 2001, the Company's current  portion  of
     long-term  debt  included $4,091,667 due in  connection  with
     debt   incurred  when  ICTI  was  purchased.   In   addition,
     $1,084,277 was accrued for interest related to the ICTI debt.
     In  the fourth quarter, the Company finalized an agreement to
     make  payments of $725,000, issue 4,000 shares of convertible
     preferred stock valued at $2,000,000, issue 50,000 shares  of
     the common stock of the Company's subsidiary, ViaCirq, valued
     at  $150,000 and issue 25,000 shares of the common  stock  of
     the  Company's subsidiary, Petrol Rem, valued at  $12,500  as
     settlement  for  the  amounts  due.   As  a  result  of  this
     agreement,   the  Company  recognized  $2,562,848   in   debt
     forgiveness in the fourth quarter.

NOTE K - LEASES

Operating Leases

     Until  October 2000, the Company was committed under  a  non-
     cancelable  operating  lease for  its  research  and  product
     development  facility.  The lease between the Company  and  a
     group  of  investors  (lessor), which included  four  of  the
     Company's  Executive  Officers and/or Directors,  was  for  a
     period  of  240 months beginning September 1, 1990.   Monthly
     rental  under the terms of the lease was $8,810 for a  period
     of  119 months to August 1, 2000.  In October 2000, after the
     Company's research and development operations had been  moved
     from  the  facility, the building was sold  by  the  investor
     group  and the lease was terminated.  Total rent expense  for
     this facility was $0, $70,480 and $105,720 in 2001, 2000  and
     1999, respectively.

     The  Company  and its related subsidiaries also  lease  other
     office  facilities, various equipment and  automobiles  under
     operating  leases  expiring in various  years  through  2005.
     Total  lease  expense related to these leases  was  $598,981,
     $534,235, and $425,654 in the years ended December 31,  2001,
     2000 and 1999, respectively.

Capital Leases

     During  1996, the Company leased two manufacturing  buildings
     under  capital leases expiring in various years through 2011.
     The  assets and liabilities under capital leases are recorded
     at  the  lower  of  the present value of  the  minimum  lease
     payments  or  the fair value of the asset.   The  assets  are
     depreciated  over the lower of their related lease  terms  or
     their  estimated  productive lives.  Depreciation  of  assets
     under capital leases is included in depreciation expense.

     During  1998, the Company terminated the lease of one of  its
     two  manufacturing buildings in response to the filing  of  a
     judgement  for nonpayment under the terms of the lease.   The
     Company  recognized  a  loss  of  $387,321  based  upon   the
     difference  between  the remaining lease obligation  and  the
     property relinquished.

     In  July  2000, the Company entered into a new capital  lease
     replacing  the lease on its manufacturing facility terminated
     in 1998.  Under the terms of the lease, the Company will make
     total  payments of $1,602,221 through December 2010, at which
     time  title  to  the  property will  be  transferred  to  the
     Company.   Management  recognized  this  property   and   the
     corresponding  capital lease obligation at the present  value
     of  the lease payments, which was $1,434,066 at the inception
     of the lease, using an imputed rate of 9% per annum.

The following is a summary of property held under capital leases:

                              Dec. 31, 2001      Dec. 31, 2000

 Buildings                  $ 2,527,326          $  2,527,326
 Land                           246,250               246,250
 Equipment                      264,490               264,490
                             ----------          ------------
       Sub Total              3,038,066             3,038,066

 Less: Accumulated Depreciation 680,776               529,286
                             ----------          ------------
 Total Property under
 Capital Leases             $ 2,357,290          $  2,508,780
                             ==========          ============

Minimum   future   lease  payments  under   capital   leases   and
noncancelable operating leases are as follows:

                                       Capital   Operating Leases
                                        Leases

     2002                           $  336,562     $    322,476
     2003                              333,654          251,661
     2004                              338,413           72,068
     2005                              352,066           16,500
     2006                              357,115              -
     Thereafter                      1,748,054              -
                                     ---------         ---------
     Total minimum lease payments    3,465,864     $    662,705
                                                       =========
     Less amounts representing       1,262,192
     interest                        ---------

     Present value of net minimum
         lease payments             $2,203,672
                                     =========


NOTE L- SUBORDINATED CONVERTIBLE DEBENTURES

     During  2001  the Company issued subordinated 4%  convertible
     debentures totaling $8,255,659.   Such convertible debentures
     were issued pursuant to Regulation D, and/or Section 4(2) and
     have  a  one-year mandatory maturity and are not saleable  or
     convertible  for  a  minimum of 90  days  from  issuance.   A
     $2,063,915  expense  was recognized  upon  issuance  for  the
     beneficial  conversion feature of these  debentures.   As  of
     December 31, 2001, all of the debentures totaling $10,655,659
     were converted into 297,516,852 shares of common stock.

     During  2000  and  1999, the Company issued  subordinated  4%
     convertible  debentures totaling $12,250,000 and $33,150,000,
     respectively.   Such  convertible  debentures   were   issued
     pursuant  to Regulation S, Regulation D, and/or Section  4(2)
     and  had  a one-year mandatory maturity and were not saleable
     or  convertible for a minimum of 45 to 90 days from issuance.
     At  December  31, 2000 and 1999, the subordinated convertible
     debentures  totaled  $2,400,000 and  $0,  respectively.   The
     debentures  issued  in  1999  and  2000  included  beneficial
     conversion  features providing a discount on the  acquisition
     of common stock at discounts ranging from 12% to 22%.


NOTE M- STOCKHOLDERS' EQUITY

     Preferred Stock

     The Board of Directors of the Company may issue up to 500,000
     shares  of preferred stock in series, which would have rights
     as determined by the Board.

     During  1999,  400,000  shares of the  preferred  stock  were
     authorized  as  "4% Cumulative Convertible  Preferred  Stock,
     Series F".  72,000 shares of this preferred stock were issued
     in  1999  and  452,000 shares were issued in 2000  and  these
     shares include a beneficial conversion feature providing  the
     preferred  stockholder a discount of 25% upon  conversion  to
     the  Company's common stock after 120 days.  The total  value
     of  this beneficial conversion feature was $1,883,333 and was
     recognized  as  constructive dividends charged to  additional
     paid  in  capital  during the year ended December  31,  2000.
     During 2000, all shares of preferred stock were converted  to
     common  stock.   In addition, a preferred stock  dividend  of
     $121,825  was  distributed  to  preferred  shareholders  upon
     conversion.

     During 2001, shares of preferred stock were authorized as "4%
     Cumulative  Convertible  Preferred Stock"  in  the  following
     series and with the following features:


                           Issued                     Number of Days
                          Shares at                        until
     Series Authorized     Dec. 31,    Conversion     Conversion to
             Shares          2001       Discount       Common Stock

      G      100,000        10,530        24%              60

      H      246,000         2,000        20%              75

      I        4,000         4,000         0%               0

      J       50,000           400        20%              30


     Series  G,  H  and J include a beneficial conversion  feature
     providing   the   preferred  shareholder  a   discount   upon
     conversion  to the Company's common stock after  a  specified
     number  of  days.   The  value of this beneficial  conversion
     feature  is  determined by reducing the market price  of  the
     Company's common stock by the discounted conversion price  on
     the  date  of commitment.  This discount is recognized  as  a
     discount  assigned  to the beneficial conversion  feature  of
     preferred stock and is amortized as constructive dividends to
     the  preferred shareholders over the holding period using the
     effective  interest method.  The total valuation discount  of
     this  beneficial  conversion feature on the  preferred  stock
     outstanding  at  December  31, 2001  was  $1,962,632.   Total
     amortization recognized as constructive dividends  that  were
     charged  to  Additional Paid in Capital  in  the  year  ended
     December 31, 2001 was $1,821,632.

     Common Stock

     In  December  2001,  we filed a Form S-8  that  included  125
     million  shares.  The  Form S-8 allows  us  to  issue  freely
     tradable  stock to non-executive employees under  our  Equity
     Compensation  Plan  and  to certain consultants  in  lieu  of
     paying them in cash.

     Common Stock Warrants

     During  2001, warrants ranging from $.015 to $.102 per  share
     to purchase 65,641,400 shares of common stock were granted at
     exercise  prices  that  were equal to or  above  the  current
     quoted  market  price of the stock on the  date  issued.   In
     2000,  warrants to purchase 5,941,998 shares were granted  at
     exercise  prices  ranging from $.07 to  $.25  per  share.  In
     connection  with  the  granting  of  warrants,  the   Company
     recognized $17,420 and $324,897 of general and administrative
     expense  in 2001 and 2000 respectively.  Warrants to purchase
     96,136,560  shares  of  common  stock  were  exercisable   at
     December  31, 2001.  The per share exercise prices  of  these
     warrants are as follows:

                   Shares               Exercise
                                         Price
                   30,000               $.0150
                   36,400               $.0156
                   60,000               $.0208
                   60,000               $.0212
                   60,000               $.0301
                   60,000               $.0372
                   85,000               $.0382
               12,550,000               $.0500
               52,000,000               $.0525
                   20,000               $.0600
                  160,000               $.0700
                  500,000               $.0730
                   35,000               $.0800
                1,700,000               $.1000
                  200,000               $.1020
                   85,000               $.1030
                1,000,000               $.1250
               19,910,500               $.1290
                1,110,200               $.1300
                  600,000               $.1400
                  400,000               $.1440
                  125,000               $.1550
                  236,798               $.1600
                   10,000               $.2200
                2,326,700               $.2500
                   80,000               $.3300
                   50,000               $.3800
                    1,482               $.4500
                  350,000               $.5000
                  884,000              $1.0000
                  150,000              $1.4800
                1,025,000              $2.0000
                   71,000              $2.1250
                   69,480              $2.2500
                   25,000              $2.4100
                   20,000              $2.7500
                   25,000              $3.0000
                   25,000              $3.2000
               ----------
       Total   96,136,560
               ==========

     The fiscal years in which common stock warrants were granted
     and the various expiration dates by fiscal year are as
     follows:

Fiscal    Warrants            Warrants Expire during Fiscal Year
 Year      Granted    2002      2003       2004        2005        2006
1990     406,700          0    406,700          0           0             0
1991   1,251,482    351,482    900,000          0           0             0
1992           0          0          0          0           0             0
1993     131,000          0    131,000          0           0             0
1994     130,000     20,000     85,000     25,000           0             0
1995           0          0          0          0           0             0
1996     234,480          0    175,000     59,480           0             0
1997     944,000    944,000          0          0           0             0
1998   1,420,000          0  1,420,000          0           0             0
1999  20,035,500          0          0 20,035,500           0             0
2000   5,941,998          0          0              5,941,998             0
2001  65,641,400          0          0                      0    65,641,400
      __________  _________  _________ __________  ___________   ___________
      96,136,560  1,315,482  3,117,700 20,119,980   5,941,998    65,641,400
      ==========  =========  ========  ==========  ===========   ===========


     The following is a summary of the warrant transactions during
     2001:

     Outstanding at beginning of period         31,378,160
     Granted during the twelve-month period     65,641,400
     Canceled during the twelve-month period      (883,000)
     Exercised during the twelve-month period         -
                                               ------------
     Outstanding and eligible for exercise at
        end of period                           96,136,560
                                               ============


The  following  is a summary of expenses recognized in  connection
with warrants granted or extended during 2001 and 2000:

                          2001                           2000
               Granted  Extended   Total      Granted   Extended      Total

Parent
 Company      $17,420   $  -     $ 17,420    $ 324,897  $   -      $  324,897
Subsidiaries:
  Diasense     55,199      -       55,199      230,178      -         230,178
  ViaCirQ     133,052      -      133,052    5,885,069  5,233,529  11,118,598
              -------   ------    -------    ---------  ---------  ----------
              188,251      -      188,251    6,115,247  5,233,529  11,348,776
              -------   ------    -------    ---------  ---------  ----------
Total        $205,671   $  -     $205,671   $6,440,144 $5,233,529 $11,673,673
              =======   ======   ========    =========  =========  ==========

     During 2001 and 2000, expenses recognized on warrants granted
     are  included in the Statement of Operations as  general  and
     administrative   expenses   of   $205,671   and   $6,071,961,
     respectively and research and development expenses of $0  and
     $368,183, respectively.

      Warrant Extensions

     During  2001,  the  Company extended  the  exercise  date  of
     warrants  to  purchase 1,432,700 shares of  common  stock  to
     certain  officers,  employees and consultants.   The  warrant
     shares  were  originally granted at exercise  prices  ranging
     from  $.25 to $3.00, and were extended at the original  grant
     price.  No expense was charged to operations since the market
     price  of  the stock was less than the present value  of  the
     warrant exercise price.

     During 2000, the Company did not extend the exercise date  of
     any warrants.

     During  1999,  the  Company extended  the  exercise  date  of
     warrants  to  purchase  540,962 shares  of  common  stock  to
     certain  officers,  employees and consultants.   The  warrant
     shares  were  originally granted at exercise  prices  ranging
     from  $.45 to $2.75, and were extended at the original  grant
     price.  No expense was charged to operations since the market
     price  of  the stock was less than the present value  of  the
     warrant exercise price.

     Diasense, Inc. Common Stock

     At  December 31, 2001, warrants to purchase 10,635,013 shares
     of  Diasense,  Inc. common stock were exercisable.   The  per
     share exercise price is $.50 for 7,780,000 shares, $1.00  for
     2,160,463 shares and $3.50 for 694,550 shares.  The  warrants
     expire at various dates through 2006.  To the extent that all
     warrants   were   exercised,  the   Company's   proportionate
     ownership would be diluted from 52% at December 31,  2001  to
     36%.

     Diasense, Inc. Warrants

     During  2001,  Diasense, Inc. granted  warrants  to  purchase
     500,000  shares of its common stock and extended the exercise
     date of warrants to purchase 1,205,750 shares of common stock
     to certain officers, directors, employees and consultants.  A
     charge  of  $55,199 is included in general and administrative
     expenses  for  warrants granted during  2001.   The  extended
     warrants were originally granted at an exercise price ranging
     from  $0.50  to  $3.50 and extended at the  same  price.   No
     expense was charged to operations since the estimated  market
     price  of  the stock was less than the present value  of  the
     warrant exercise price.


     During  2000,  Diasense, Inc. granted  warrants  to  purchase
     2,075,000  shares  of  its  common  stock  and  extended  the
     exercise  date  of warrants to purchase 2,483,050  shares  of
     common  stock  to certain officers, directors, employees  and
     consultants.  A charge of $230,178 is included in general and
     administrative  expenses for warrants  granted  during  2000.
     The  extended warrants were originally granted at an exercise
     price  ranging from $1.00 to $3.50 and extended at  the  same
     price.   No  expense  was  charged to  operations  since  the
     estimated market price of the stock was less than the present
     value of the warrant exercise price.

     Petrol Rem, Inc. Common Stock

     At  December 31, 2001, warrants to purchase 6,490,000  shares
     of  Petrol Rem common stock were exercisable.  The per  share
     exercise  price  is  $.10  for  3,940,000  shares,  $.50  for
     2,350,000 shares and $1.00 for 200,000 shares.  The  warrants
     expire at various dates through 2006.  To the extent that all
     the  warrants  were  exercised, the  Company's  proportionate
     ownership would be diluted from 75% at December 31,  2001  to
     57%.

     Petrol Rem Warrants

     During  2001, Petrol Rem, Inc. granted warrants  to  purchase
     200,000  shares  of  its common stock  to  certain  officers,
     directors, employees and consultants.  No expense was charged
     to  operations since the market price of the stock  was  less
     than the present value of the warrant exercise price.  Petrol
     Rem  did not extend the exercise dates of any warrants during
     2001.

     During  2000, Petrol Rem, Inc. granted warrants  to  purchase
     1,950,000  shares  of its common stock to  certain  officers,
     directors, employees and consultants.  No expense was charged
     to  operations since the market price of the stock  was  less
     than the present value of the warrant exercise price.  Petrol
     Rem  did not extend the exercise dates of any warrants during
     2000.

     ViaCirq, Inc. Common Stock

     At  December 31, 2001, warrants to purchase 6,508,000  shares
     of  ViaCirq  common stock were exercisable.   The  per  share
     exercise  price  is $.10 for 6,183,000 shares  and  $.50  for
     20,000  shares,  $1.00 for 285,000 shares,  $2.00  for  5,000
     shares  and $3.00 for 15,000 shares.  The warrants expire  at
     various  dates  through 2006.  To the  extent  that  all  the
     warrants   were   exercised,  the   Company's   proportionate
     ownership would be diluted from 99% at December 31,  2001  to
     70%.

     ViaCirq, Inc. Warrants

     During  2001,  ViaCirq,  Inc. granted  warrants  to  purchase
     25,000  shares  of  its  common stock  to  certain  officers,
     directors,  employees and consultants.  Charges  of  $133,052
     are  included in general and administrative expenses for  the
     warrants  granted  during 2001. ViaCirq did  not  extend  the
     exercise dates of any warrants during 2001.

     During  2000,  ViaCirq,  Inc. granted  warrants  to  purchase
     2,128,000  shares  of  its  common  stock  and  extended  the
     exercise  date  of warrants to purchase 3,125,000  shares  of
     common  stock  to certain officers, directors, employees  and
     consultants.  Charges of $5,516,886 and $368,183 are included
     in  general  and  administrative expenses  and  research  and
     development expenses, respectively, for the warrants  granted
     during  2000.  The extended warrants were originally  granted
     at an exercise price ranging from $0.10 to $3.00 and extended
     at  the  same  price.   ViaCirq, Inc. recorded  a  $5,233,529
     expense for these extended warrants.

NOTE N- INCOME TAXES

     As  of  December  31, 2001, the Company and its  subsidiaries
     except  Diasense Inc., Petrol Rem, Rapid HIV, and ICTI,  have
     available  approximately $157,400,000 of net  operating  loss
     carryforwards   for  federal  income  tax  purposes.    These
     carryforwards  are  available,  subject  to  limitations,  to
     offset  future taxable income, and expire in tax  years  2002
     through  2022.  The Company also has research and development
     credit carryforwards available to offset federal income taxes
     of approximately $1,569,000, subject to limitations, expiring
     in tax years 2005 through 2021.

     As  of  September  30,  2001, the end  of  its  fiscal  year,
     Diasense, Inc. had available approximately $26,700,000 of net
     operating loss carryforwards for federal income tax purposes.
     These  carryforwards,  which expire  during  the  years  2005
     through  2021,  are  available, subject  to  limitations,  to
     offset  future  taxable  income.   Diasense,  Inc.  also  has
     research  and development credit carryforwards available  for
     federal   income  tax  purposes  of  approximately  $700,000,
     subject  to  limitations, expiring in the years 2005  through
     2012.

     As   of   December  31,  2001,  Petrol  Rem   had   available
     approximately $17,600,000 of net operating loss carryforwards
     for  federal income tax purposes.  These carryforwards, which
     expire  during  the years 2008 through 2022,  are  available,
     subject  to  limitations, to offset  future  taxable  income.
     Petrol   Rem   also  has  research  and  development   credit
     carryforwards  available for federal income tax  purposes  of
     approximately $15,000.

     As   of   December   31,  2001,  Rapid  HIV   had   available
     approximately  $480,000 of net operating  loss  carryforwards
     for  federal income tax purposes.  These carryforwards, which
     expire   in   the  year  2022,  are  available,  subject   to
     limitations, to offset future taxable income.

     As  of  December  31, 2001, ICTI had available  approximately
     $1,435,000  of net operating loss carryforwards  for  federal
     income  tax  purposes.   These  carryforwards,  which  expire
     during the years 2018 through 2020, are available, subject to
     limitations, to offset future taxable income.

     Certain  items  of  income  and  expense  are  recognized  in
     different  periods  for financial and  income  tax  reporting
     purposes.   In  the year ended December 31, 1999,  a  warrant
     exercise adjustment of $50,625 was reported for tax purposes.
     The  fair  market  value  of  warrant  extentions  have  been
     recorded and expensed for financial statement purposes in the
     year ended December 31, 1999 in the amount of $6,092,562  and
     in the year ended December 31, 2000 of $11,118,598.

     The  Company has not reflected any future income tax benefits
     for these temporary differences or for net operating loss and
     credit  carryforwards  because  of  the  uncertainty  as   to
     realization.  Accordingly, the adoption of  FAS  109  had  no
     effect on the financial statements of the Company.

     The  following  is  a  summary  of  the  composition  of  the
     Company's   deferred  tax  asset  and  associated   valuation
     allowance  at  December  31,  2001,  December  31,  2000  and
     December 31, 1999:

                                  Dec. 31,      Dec. 31,        Dec. 31,
                                    2001          2000            1999

       Net Operating Loss       $53,516,000    $ 45,050,000   $ 37,672,000
       Warrant Expense            8,593,191       8,593,191      4,812,686
       Tax Credit Carryforward    1,569,000       1,775,000      1,370,000
                                 ----------      ----------    -----------
                                 63,678,191      55,418,191     43,854,868
       Valuation Allowance      (63,678,191)    (55,418,191)   (43,854,868)
                                 ----------      ----------    -----------
       Net Deferred Tax Asset  $       -        $      -       $      -
                                 ==========      ==========    ===========


     The  following is a summary of deferred tax benefit and the
     associated increase in  the valuation allowance:


                                                  Increase in
                                    Deferred       Valuation
                                   Tax Benefit     Allowance      Net


     Year-ended December 31, 2001  $( 8,466,000)  $  8,466,000    $ 0
     Year-ended December 31, 2000  $(11,357,323)  $ 11,357,323    $ 0
     Year-ended December 31, 1999  $(11,718,671)  $ 11,718,671    $ 0
     From March 20, 1972 (inception)
     Through December 31, 2001     $(63,678,191)  $ 63,678,191    $ 0

     Intco, Inc., a subsidiary of Petrol Rem, files separate income
     tax returns. At December 31, 2001, the Company has included
     Intco's tax provision and related deferred and current taxes
     in the accompanying financial statements as follows:


                            Amount   Recorded As
                            ------   -----------
     Income tax provision     $120,882  Other income and expense-other taxes
     Deferred tax asset       $  8,115  Other assets
     Deferred tax liability   $ 25,009  Long-term liabilities-other
     Income taxes payable     $140,827  Accrued liabilities


NOTE O - RELATED PARTY TRANSACTIONS

     Research and Development Activities

     The  Company is currently performing research and development
     activities  related to the non-invasive glucose  sensor  (the
     Sensor)  under  a  Research  and Development  Agreement  with
     Diasense,  Inc.  If successfully developed, the  Sensor  will
     enable  users to measure blood glucose levels without  taking
     blood  samples.  Diasense, Inc. acquired the  rights  to  the
     Sensor,  including  one United States patent  from  BICO  for
     $2,000,000  on  November 18, 1991.  Such  patent  covers  the
     process  of  measuring  blood glucose levels  non-invasively.
     Approval   to  market  the  Sensor  is  subject  to   federal
     regulations including the Food and Drug Administration (FDA).
     The Sensor is subject to clinical testing and regulatory
     approvals  by the FDA.  BICO is responsible for substantially
     all  activities in connection with the development,  clinical
     testing,  FDA approval and manufacturing of the  Sensor.   As
     discussed in Note B,

     BICO  finances  its operations from the sales  of  stock  and
     issuance of debt and was reimbursed for costs incurred  under
     the  terms  and  conditions of the Research  and  Development
     Agreement  for the research and development of the Sensor  by
     Diasense,  Inc.   If  BICO were unable to perform  under  the
     Research   and   Development  or  Manufacturing   Agreements,
     Diasense,  Inc.  would need to rely on other arrangements  to
     develop  and manufacture the Sensor or perform these  efforts
     itself.

     BICO  and  Diasense,  Inc.  have entered  into  a  series  of
     agreements  related  to  the development,  manufacturing  and
     marketing  of the Sensor.  BICO is to develop the Sensor  and
     carry  out all steps necessary to bring the Sensor to  market
     including   1)  developing  and  fabricating  the  prototypes
     necessary  for clinical testing; 2) performing  the  clinical
     investigations  leading  to FDA approval  for  marketing;  3)
     submitting   all  applications  to  the  FDA  for   marketing
     approval;  and 4) developing a manufacturable and  marketable
     product.  Diasense, Inc. is to conduct the marketing  of  the
     Sensor.   The  following  is  a  brief  description  of   the
     agreements:

     Manufacturing Agreement

     The  manufacturing agreement between BICO and Diasense,  Inc.
     was  entered into on January 20, 1992.  BICO is to act as the
     exclusive manufacturer of production units of the Sensor upon
     the  completion of the Research and Development Agreement and
     sell the units to Diasense, Inc. at a price determined by the
     agreement. The term of the agreement is fifteen years.

     Research and Development Agreement

     Under  a  January 1992 agreement between BICO  and  Diasense,
     Inc.,  beginning  in April 1992, BICO received  $100,000  per
     month, plus all direct costs for the research and development
     activities of the Sensor.  This agreement replaced a previous
     agreement  dated May 14, 1991.  The term of the new agreement
     is  fifteen  years.   In July 1995, BICO and  Diasense,  Inc.
     agreed  to  suspend  billings, accruals of  amounts  due  and
     payments  pursuant to the research and development  agreement
     pending the FDA's review of the Sensor.

     Purchase Agreement

     In November 1991, BICO entered into a Purchase Agreement with
     Diasense,  Inc.  under which Diasense, Inc.  acquired  BICO's
     rights to the Sensor for a cash payment of $2,000,000.   This
     agreement  permits  BICO  to use Sensor  technology  for  the
     manufacture and sale by BICO of a proposed implantable closed
     loop system. BICO will pay Diasense, Inc. a royalty equal  to
     five percent of the net sales of such implantable closed loop
     system.

     Real Estate Activities

     Four of the Company's Executives and/or Directors are members
     of  an  eight-member partnership that in July 1990  purchased
     the  Company's real estate in Indiana, Pennsylvania, and each
     personally guaranteed the payment of lease obligations to the
     bank  providing the funding.  For their personal  guarantees,
     the  four  individuals  each received  warrants  to  purchase
     100,000  shares of the Company's common stock at an  exercise
     price  of $.33 per share until June 29, 1995.  Those warrants
     still  outstanding  as of the original expiration  date  were
     extended  until June 29, 2001.  In 1999, after all operations
     were  relocated from this site, the property was offered  for
     sale.   The  property was sold in October 2000 and the  lease
     was terminated.

     Amounts due from Officers

     On  April  28,  1999,  Fred  E.  Cooper,  CEO  and  Director,
     consolidated various outstanding obligations into a term loan
     totaling  $777,400 payable in monthly installments of  $9,427
     with  a  final balloon payment on May 31, 2002.  Interest  on
     this loan is accrued at a rate of 8% per annum.

     Total  amounts due from Mr. Cooper at December 31,  2001  and
     December 31, 2000, include balances of $671,338 and $715,963,
     respectively, on the term loan discussed above  plus  accrued
     interest of $6,683 and $9,163, respectively.

     On  April  28,  1999, Glenn Keeling, a Director, consolidated
     various  outstanding obligations into a  term  loan  totaling
     $296,358  payable in monthly installments of  $4,184  with  a
     final balloon payment on May 1, 2002.  Interest on this  loan
     is accrued at a rate of 8% per annum.

     Total  amounts due from Mr. Keeling at December 31, 2001  and
     December 31, 2000, include balances of $146,332 and $237,737,
     respectively, on the term loan discussed above  plus  accrued
     interest of $3,829 and $3,668, respectively.

     On April 28, 1999, T.J. Feola, COO and Director, consolidated
     various  outstanding obligations into a  term  loan  totaling
     $259,477  payable in monthly installments of  $3,676  with  a
     final balloon payment on May 31, 2002.  Interest on this loan
     is accrued at a rate of 8% per annum.

     Total  amounts due from Mr. Feola at December  31,  2001  and
     December  31, 2000 include balances of $195,623 and $221,308,
     respectively, on the term loan discussed above  plus  accrued
     interest of $1,947 and $631, respectively.

     As  of  December  31, 2001 and 2000 the Company  had  a  note
     receivable from Allegheny Food Services, Inc. of which Joseph
     Kondisko,  a former director, is principal owner.  The  loan,
     which  bears  interest at a rate of 9.25%,  is  payable  upon
     demand.  The outstanding balance on this loan was $24,394  at
     December 31, 2001 and $87,706 at December 31, 2000.

     During  1999  the Company made various demand loans  totaling
     $150,000  to  B-A-Champ.com, Inc.,  a  company  substantially
     owned by Fred E. Cooper, CEO.  As of December 31, 1999, these
     loans had been repaid to a balance of $50,000 with an accrued
     interest  of  $3,006.  As of December 31, 1999,  the  Company
     owned  approximately 6.5% of the outstanding  stock  of  B-A-
     Champ.com,  Inc.   In  2000, the Company provided  additional
     funding of $400,000 in exchange for additional shares of B-A-
     Champ.com,  Inc.  In addition, the Company converted  a  note
     receivable  of $50,000 from B-A-Champ.com, Inc. plus  accrued
     interest  of  $5,256 to common stock.  As a result  of  these
     additional  investments,  the  Company  owned  51%   of   the
     outstanding  stock of B-A-Champ.com, Inc. as of December  31,
     2001   and  2000  and  included  B-A-Champ.com,  Inc.  as   a
     consolidated  subsidiary in the December 31,  2001  and  2000
     financial  statements.   As of December  31,  2000,  Fred  E.
     Cooper,  Chief  Executive  Officer  of  the  Company,   owned
     approximately  30% of the outstanding common  stock  of  B-A-
     Champ.com, Inc.  In 2001, Mr. Cooper gave his shares of  B-A-
     Champ.com, Inc. to BICO.  As of December 31, 2001, BICO  owns
     99.8% of B-A-Champ.com, Inc.

     In  April  2001,  the  Company loaned $70,000  to  Pascal  M.
     Nardelli,  President and CEO of Petrol Rem, Inc.   In  August
     2001,  this  demand note and accrued interest of $2,110  were
     paid in full.

     In  May  2001,  the  Company loaned $110,000  to  Anthony  J.
     Delvicario,   president   of  the  Company's   unconsolidated
     subsidiary, American Inter-Metallics, Inc., and a  member  of
     Diasense's board of directors.  The original demand note  was
     secured  by 110,000 shares of American Inter-Metallics,  Inc.
     common  stock  and  bore  interest at  prime  rate  plus  two
     percent.  In November 2001, the note was converted into a new
     note  for  $114,000 to reflect accrued interest,  payable  in
     monthly  installments of $5,000.  The note is secured  by  an
     unconditional guaranty by American Inter-Metallics and all of
     American  Inter-Metallics'  assets,  including  all  of   its
     equipment.

     Employment Contracts

     The  Company has employment contracts with change in  control
     provisions with four officers.  In the event of a  change  in
     control   in  the  Company  and  termination  of  employment,
     continuation of annual salaries at 100% decreasing to 25% are
     payable in addition to the issuing of shares of common  stock
     as  defined in the contracts.  The contracts also provide for
     severance,  disability benefits and issuances of BICO  common
     stock under certain circumstances.

     Consulting

     In   2000,  Thomas  F.  Feola,  was  engaged  as  an  outside
     consultant  to assist with the identification and  evaluation
     of   environmental  companies  for  potential   acquisitions,
     mergers  or  strategic alliances.  Thomas  F.  Feola  is  the
     brother of Anthony J. Feola, COO and a director.  The Company
     paid  Thomas  Feola $64,000 in 2000 and $56,000 in  2001  for
     these services which were terminated in August 2001.

NOTE P- COMMITMENTS AND CONTINGENCIES

     Litigation

     On  April 30, 1996, a class action lawsuit was filed  against
     the  Company,  Diasense,  Inc., and individual  officers  and
     directors.   The  suit,  captioned Walsingham  v.  Biocontrol
     Technology,  et al., was certified as a class action  in  the
     U.S. District Court for the Western District of Pennsylvania.
     The  suit  alleged misleading disclosures in connection  with
     the  Noninvasive Glucose Sensor and other related activities,
     which  the  Company denies.  Without agreeing to the  alleged
     charges  or  acknowledging any liability or  wrongdoing,  the
     Company  agreed to settle the lawsuit for a total  amount  of
     $3,450,000.   As  of December 31, 2001, $3,250,000  has  been
     paid  toward  the  settlement.  During the third  quarter  of
     2001,  the  parties  agreed to extend  the  payments  on  the
     remaining  balance.   The remaining  balance  of  425,000  is
     included  in  accrued  liabilities,  including  $225,000  for
     extending the due dates, and was due in the fourth quarter of
     2001.   Due to cashflow problems, the final payment  was  not
     made  in 2001.  Payment is necessary in order to satisfy  the
     terms  of  the settlement.  Although it is not known  whether
     the  class  action plaintiffs have been formally notified  of
     the  settlement,  or  if they have accepted  its  terms,  the
     Company  believes that the existing settlement will end  this
     matter.

     Pennsylvania Securities Commission

     The  Pennsylvania  Securities  Commission  is  conducting   a
     private  investigation  of the Company  and  its  subsidiary,
     Diasense,  Inc., in connection with the sale  of  securities.
     The  Companies have cooperated with and provided  information
     to  the Pennsylvania Securities Commission in connection with
     the private investigation.  As the Commission's investigation
     is  not  yet complete, there can be no estimate or evaluation
     of the likelihood of an unfavorable outcome in this matter or
     the range of possible loss, if any.

     Additional Legal Proceedings

     In  April  1998, the Company and its affiliates  were  served
     with  subpoenas  requesting documents in connection  with  an
     investigation  by  the U.S. Attorneys' office  for  the  U.S.
     District Court for the Western District of Pennsylvania.  The
     Company continues to submit various scientific, financial and
     contractual documents in response to such requests.

NOTE Q- EMPLOYEE BENEFIT PLAN

     The  Company  has  a defined contribution  plan  with  401(k)
     provisions,  which covers all employees meeting  certain  age
     and  period  of service requirements.  Employer contributions
     are  discretionary as determined by the Board  of  Directors.
     There  have been no employer contributions to the  plan  from
     inception through December 31, 2001.

NOTE R - STOCK ACQUISITIONS

     ICTI, Inc.

     Effective  March  4,  1998,  pursuant  to  a  Stock  Purchase
     Agreement dated February 20, 1998, the Company acquired 58.4%
     of   International  Chemical  Technologies,  Inc.  (ICTI)   a
     development stage corporation.  ICTI commenced operations  in
     May   1997   and  planned  to  engage  in  the  business   of
     manufacturing  and  marketing,  and  licensing  rights   with
     respect  to  certain  corrosion/wear-resistant  metal   alloy
     coating compositions.

     Consideration for the purchase of the 58.4% interest in  ICTI
     included a cash payment of $1,030,000; a promissory note  for
     $3,350,000 at 8%; 2,000,000 shares of BICO common stock (fair
     market  value  of $250,000), a warrant to purchase  1,000,000
     shares  of BICO stock for $2 per share anytime through  March
     4,  2003; and the guarantee by BICO of a promissory note  for
     $1,300,000 payable by ICTI to the seller.

     The  Company recognized $5,310,501 of goodwill in  connection
     with  the  ICTI  Stock Purchase Agreement.  For  purposes  of
     amortizing this goodwill, management had determined a  useful
     life  of  5 years.  Accumulated amortization on this goodwill
     was $887,080 at December 31, 1998.  Based upon a reevaluation
     of  this  goodwill, the remaining balance of  $4,423,421  was
     included   in  an  impairment  charge  recognized  in   1999.
     Management's reevaluation was reached due to failure  of  the
     investment  to  perform as anticipated and the decision  that
     future  cash  flow was unlikely.  For these same  reasons  an
     impairment  charge  of  $637,530 was recorded  to  write  off
     associated plant and equipment.

     B-A-Champ.com

     Effective  August 1, 2000, the Company acquired an additional
     44.5%   of   B-A-Champ.com,   Inc.,   a   development   stage
     corporation.    This  additional  investment  increased   the
     Company's  ownership of B-A-Champ.com,  Inc.  to  51%.   B-A-
     Champ.com,  Inc. commenced operations in 1999  and  plans  to
     engage in various internet promotional activities.

     Consideration  for  the  purchase  of  the  additional  44.5%
     interest  in B-A-Champ.com, Inc. included a cash  payment  of
     $400,000 and the conversion of a $50,000 note receivable from
     B-A-Champ.com,  Inc.  plus accrued interest  of  $5,256  into
     common stock.

     The  Company  recognized $259,964 of goodwill  in  connection
     with the acquisition of B-A-Champ.com, Inc.  For purposes  of
     amortizing this goodwill, management has determined a  useful
     life  of  5 years.  Accumulated amortization on this goodwill
     was $73,657 at December 31, 2001.

     In  2001, most of the minority owners of B-A-Champ.com,  Inc.
     gave  their  shares  to BICO increasing BICO's  ownership  to
     99.8%.

     INTCO, Inc.

     Pursuant  to  a  Stock Purchase Agreement dated  November  1,
     2000,  Petrol Rem, Inc. acquired 51% of INTCO,  Inc.   INTCO,
     Inc. was incorporated on February 5, 1981 and engages in oil-
     spill  cleanup  and  the  treatment of  oil  wells  and  also
     charters out self-propelled barges for maintenance work.

     Consideration for the purchase of 51% on INTCO, Inc. included
     a  cash  payment  of $250,000 and a promissory  note  for  $1
     million.   This promissory note was fully paid as of December
     31, 2001.

     The  Company  recognized $310,567 of goodwill  in  connection
     with  the  INTCO Stock Purchase Agreement.  For  purposes  of
     amortizing this goodwill, management has determined a  useful
     life  of  5 years.  Accumulated amortization on this goodwill
     was $72,465 at December 31, 2001.

     Tireless, LLC

     In  October  2000, Petrol Rem, Inc. and Universal Scrap  Tire
     Company, LLC (an unaffiliated company) formed a joint venture
     called  Tireless, LLC (Tireless) with Petrol  Rem,  Inc.  and
     Universal  Scrap  Tire  Company,  LLC  owning  51%  and  49%,
     respectively.   Tireless  is  engaged  in  the   acquisition,
     shredding and disposal of tires and tire parts.

     Consideration for the 51% ownership in Tireless  included  an
     agreement by Petrol Rem to provide working capital funding of
     $455,000  to Tireless.  As of December 31, 2001,  Petrol  Rem
     had  invested $455,000 in Tireless and made loans to Tireless
     totaling $381,160 to fund its operating and capital needs.

     Petrol Rem recognized $164,611 of goodwill in connection with
     the  investment in Tireless.  For purposes of amortizing this
     goodwill, management has determined a useful life of 5 years.
     Accumulated amortization on this goodwill was $52,145  as  of
     December 31, 2001.

 NOTE S - SUBSEQUENT EVENTS

     Preferred Stock

     During   January   and  February  2002,  we  issued   570,000
     additional shares of our Series J preferred stock.

     In   February  2002,  we  accepted  a  $25  million   funding
     commitment  from  J.P. Carey Asset Management.   The  initial
     funding will be through their purchase of $7.5 million of our
     Series  K  preferred  stock after our registration  statement
     covering the 620 million shares needed to cover the Series  K
     conversions  is  declared effective  by  the  Securities  and
     Exchange Commission.

     Common Stock

     During the first quarter 2002, we issued approximately 101.25
     million shares of our common stock from the Form S-8.

     Bridge Loan

     In  March  2002,  we  obtained  a   $4  million  bridge  loan
     commitment  to  help us meet our cash flow  needs  until  the
     registration  statement covering the common stock  underlying
     our  preferred  stock  is  declared effective  and  we  begin
     receiving  funding from our $25 million commitment from  J.P.
     Carey  Asset Management discussed above.  The bridge loan  is
     repayable in one year. $1 million of the $4 million commitment
     had been placed in escrow as of March 29, 2002. These funds
     will be released from escrow upon the filing of the Company's
     registration statement. This $1 million loan was collateralized
     by all equipment and other property of the Company.

     Planned Subsidiary Disposition

     In  the  first quarter 2002 the Company's Board of  Directors
     directed  Management  to  pursue  the  disposition   of   two
     consolidated  subsidiaries,  Ceramic  Coatings  Technologies,
     Inc.,  and  B-A-Champ.com (dba True  Points.com).   In  2001,
     these   two   subsidiaries  had  losses  of  $(962,000)   and
     $(1,226,313)  respectively,  which  were  included   in   the
     consolidated results of operations of the Company.

     Clinical Trials

     The  clinical  trials,  which were  being  performed  on  the
     Company's noninvasive glucose sensor were discontinued during
     the  first quarter of 2002 so that efforts could be  directed
     toward  the  development  of  a new  generation  device.  The
     clinical trials for the new device are being planned but will
     be deferred until Management determines that adequate funding
     is  available.   Total  costs incurred during  2001  for  the
     clinical trials were approximately $1,900,000.