UNITED STATES SECURITIES AND EXCHANGE COMMISSION  Washington, D.C.  20549  FORM
10-KSB   [X] ANNUAL REPORT PURSUANT TO SECTION 13
OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934  For the fiscal year ended November 30, 2007  [ ] TRANSITION REPORT UNDER SECTION
13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934  For the transition period from
__________________ to __________________  GENOSYS, INC. (Name of Smaller Reporting Company in its
Charter)  Commission File Number: 000-49817  Utah
87-0671592(State or other jurisdiction of
incorporation or organization)
(IRS Employer Identification
No.)  280 W. Riverpark Drive, Provo, UT
84604 (Address of Principal Executive Offices)  Issuers Telephone Number:  (801)
623-4751  Securities Registered under Section 12(b) of
the Exchange Act:  None  Securities Registered under Section 12(g) of
the Exchange Act:  Common Stock, par value $0.001 per share (Title of Class)  Check whether the Issuer is not required to file reports
pursuant to Section 13 or 15(d) of the Exchange Act. [ ]  Check whether the Issuer (1) filed all reports required
to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months
(or for such shorter period that the Issuer was required to file such reports),
and (2) has been subject to such filing requirements for the past 90 days. (1)   Yes
 [X]   (2)   Yes  [X]  Check if there is no disclosure of delinquent filers in
response to Item 405 of Regulation S-B contained in this form, and no disclosure
will be contained, to the best of Issuers knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-KSB
or any amendment to this Form 10-KSB.  [ ]  Indicate by check mark whether the Issuer is a shell
company (as defined in Rule 12b-2 of the Exchange Act).
      No [X].       State Issuers revenues for its most recent fiscal year:
November 30, 2007 -$0  The aggregate market value of common stock held by
non-affiliates (i.e., does not include directors, executive officers or ten
percent stockholders identified in Item 11 hereof) of the Issuer as of February
22, 2008, was approximately $11,948,008.  As of February 22, 2008, the Issuer had 45,898,741 shares
of common stock outstanding.  DOCUMENTS INCORPORATED BY REFERENCE  For information on documents incorporated herein by
reference, see Part III, Item 13.  Transitional Small Business Disclosure Format:  Yes
[ ]  No  [X]   2      GeNOsys, Inc.  TABLE OF CONTENTS TO ANNUAL REPORT ON FORM 10-KSB YEAR ENDED NOVEMBER 30, 2007   PART I 4 Item 1.
 Description of Business. 4 Item 2.
 Description of Property. 17 Item 3.  Legal
Proceedings. 18 Item 4.
 Submission of Matters to a Vote of Security Holders. 18 PART II 19 Item 5.  Market
for Common Equity, Related Stockholder Matters and Smaller Reporting Company
Purchases of Equity Securities.19 Item 6.
 Managements Discussion and Analysis or Plan of Operation. 21 Item 7.
 Financial Statements . 24 Item 8.  Changes
in and Disagreements with Accountants on Accounting and Financial
Disclosure. 25 Item 8(b).
 Other. 26 PART III 27 Item 9.
 Directors, Executive Officers, Promoters and Control Persons; Compliance
with Section 16(a) of the Exchange Act.27 Item 10. Executive
Compensation. 30 Item 11. Security
Ownership of Certain Beneficial Owners and Management. 31 Item 12. Certain
Relationships and Related Transactions. 31 Item 13. Exhibits and
Reports on Form 8-K. 32 Item 14. Principal
Accountant Fees and Services. 32 SIGNATURES 32     3     Forward-Looking
Statements  When used in this Annual
Report on Form 10-KSB, the words or phrases would be, will allow, intends
to, will likely result, are expected to, will continue, is anticipated,
estimate, project, or similar expressions are intended to identify
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995.  Forward-looking statements specifically
include, but are not limited to, our expectations regarding strategic business
initiatives, our intentions to defend our intellectual property rights, continue
our research and development, seek regulatory approvals, and plans regarding
sales and marketing.  We caution readers not to
place undue reliance on the forward-looking statements, which speak only as of
the date of this report, are based on certain assumptions and expectations which
may or may not be valid or actually occur, and which involve various risks and
uncertainties, including but not limited to competitive products and pricing,
difficulties in product development, commercialization and technology, changes
in the regulation of healthcare products, a failure to timely obtain Food and
Drug Administration (FDA) or other necessary approvals to sell future products
and other risks set forth in Item 6 Risk Factors and elsewhere herein.
 If and when product sales commence, sales may not reach the levels
anticipated.  As a result, our actual results for future periods could
differ materially from those anticipated or projected.  All forward-looking
statements reflect our present expectation of future events and are subject to a
number of important factors and uncertainties that could cause actual results to
differ materially from those described in the forward-looking statements.  Unless otherwise required
by applicable law, we do not undertake, and specifically disclaim any
obligation, to update any forward-looking statements to reflect occurrences,
developments, unanticipated events or circumstances after the date of such
statement.     PART I     Item 1.  Description of Business.  References to our
Company, our, we, us and words of similar import refer to GeNOsys, Inc.
(GeNOsys), a Utah corporation, formerly known as The Autoline Group, Inc.,
and our wholly-owned subsidiary, GeNOsys, Inc., a Nevada corporation (GeNOsys
Nevada), as applicable.  Our current operations will be conducted through
GeNOsys.  Business
Development   Current
Developments Fiscal Year 2008  Effective January
22, 2008, we announced that we had completed formulation of our Nitric Oxide
Generator Portable Tablet into a product that could be manufactured in high
quantities yet maintain the necessary tablet hardness, appropriate generated
Nitric Oxide concentration and volume.  For additional information, please
see our 8-K Current Report filed with the Securities and Exchange Commission on
February 12, 2008, referenced and incorporated herein.  See Part III, Item
13.  Fiscal Year
2007  The following
developments occurred in fiscal 2007:  · On March 23, 2007, our Board of
Directors unanimously resolved to designate Keith L. Merrell to serve as our new
Chief Financial Officer, Treasurer and General Manager and accepted the
resignation of Christie Jones as a director, effective as of March 22, 2007.     4     · We held our 2007 Annual Meeting of
Shareholders on June 27, 2007, at which time three proposals were submitted to
and approved by a majority vote of our shareholders.  The first proposal
was for the election of our current Board of Directors; the second proposal was
the approval of an amendment to our Articles of Incorporation to increase the
number of our authorized shares from 50,000,000 shares to a total of 100,000,000
shares; and the third proposal was the approval our 2007 Stock Option Plan.  · In June and July of 2007, our Board
of Directors approved stock option grants to purchase 1,100,000 shares of our
common stock to certain employees, directors and consultants.  Fiscal Year 2006  The following developments occurred in
fiscal 2006:  · On January 24, 2006, we executed a
Research and Advisory Services Agreement (the Agreement) with IriSys Inc., a
Pharmaceutical Formulation Development and cGMP (current good manufacturing
practices) firm located in San Diego, California.  Fiscal Year 2005  For business developments that
occurred during the fiscal year ended November 30, 2005, see our 10-KSB Annual
Report for the fiscal year ended November 30, 2005, filed with the Securities
and Exchange Commission on March 7, 2006, which is incorporated herein by
reference in Part III, Item 13.  Business  With the completion of our
merger with GeNOsys Nevada, we are now a medical research and development
company that is specializing in pharmaceutical, bio-technical and medical gas
generating systems.  The primary gas our systems will generate is nitric oxide, along with
other various combinations of beneficial medical gases suitable for the
treatment of human diseases.  Nitric oxide gas is
produced and sold commercially by major gas companies as a specialty gas mixture
and calibration gas.  Nitrogen dioxide is present in all nitric oxide gas
currently produced; its presence limits the size of the dose of nitric oxide gas
that can be administered to both humans and animals.  We have developed a
proprietary compound formulation that will be utilized to produce nitric oxide
gas in our desktop generators.  Management believes that with further
formulation of our proprietary compound, we can make or filter nitric oxide gas
with less toxic amounts of nitrogen dioxide, and that this process can produce
nitric oxide gas in ample quantities for any current or prospective use and at a
price substantially less than that of all currently available technologies.  Our current generator model
is capable of delivering sufficient quantities of nitric oxide gas for
individual laboratory desktop use. We are continuing to further develop our
generator and our compound formulation for high production quantities and
consistency.  The product must have a known shelf life and be available in
various configurations to produce known concentrations and volumes of gas.
 Packaging is another critical developmental process that will need to be
addressed. Management plans to rely on outside contractors to achieve some or
all these objectives.  We estimate that
non-clinical laboratory sales should take place earlier than United States Food
and Drug Administration (FDA) approval. Management anticipates that selling
our generator earlier into the market as laboratory equipment will pave the way
for sales of our medical generator and proprietary tablets, but expected
financial contributions from non-medical generator and tablet sales will be too
late to help with the substantial costs of the FDA approval process for human
medical uses.  We expect that contributions will be able to support our
manufacturing and set-up costs and contribute to our overall profitability in
due time, but we believe that they will  5     also require financing.
 We anticipate entering the non-clinical laboratory market in the next 24
months.  All human medical uses of
nitric oxide gas require FDA approval, and the approval of similar international
agencies.  Approval can be a long and expensive process, with no assurance
that any such approval can ever be obtained.  Management hopes to reduce
the time for regulatory approval by certain strategic approaches that are
proprietary.  Our objectives are to
establish GeNOsys (generated nitric oxide systems) as the premier nitric oxide
generating pharmaceutical company and to:  · manufacture and sell medical grade
nitric oxide generators and tablets for use in the relief of human diseases;  · offer value added services such as
custom generators adapted for the treatment of various diseases;  · hire staff both currently identified
and unidentified to implement our business model;  · gain FDA approval of our generating
system; and  · to reach a break-even point by the
end of year five.  Principal Products or
Services and Their Markets  Our principal products are
our nitric oxide gas generator and our proprietary compound formulation for use
in these generators for producing nitric oxide gas.  We believe that our
technology rights represent an improvement in existing methods of producing and
delivering nitric oxide gas.  See the heading Patents, Trademarks,
Licenses, Franchises, Concessions, Royalty Agreements or Labor Contracts, of
this Item, below.  There are no current human medical uses for nitric oxide
that do not require prior FDA approval.  See the heading Need for any
Governmental Approval of Principal Products or Services, of this Item,
below.  Our business model is built
upon the sale of our gas generators to hospitals, laboratories and other medical
groups requiring our products, with ongoing revenues being expected from the
continued sale of our proprietary nitric oxide producing tablets.  In order to further shorten
the time line to positive cash flow and to lessen the cash demand, laboratory
sales of generating devices will commence as soon as possible.  We believe
that less stringent regulatory demands make this an attractive method of
infiltration into the research community.  As sales increase in the
laboratory market, new uses for the gas generator will be spawned as well as new
applications and dose ranges for other diseases that may be unknown at this
time.  This new knowledge can be used to our advantage in customizing and
updating generators for these new markets.  There is a substantial
market for use of nitric oxide gas for use in experiments in various non-medical
trials which do not require the use of a medically approved nitric oxide gas.
 We will target that market as soon as we have completed planned additional
development of our generator and the further formulation of our proprietary
compound, estimated to be completed during 2008.  Distribution Methods of
the Products or Services  In North America, the FDA
restricts sales of drugs that do not meet their approval.  Our strategy
will be to attempt to ensure that our human medical products are FDA approved.
 After FDA approval, we will choose an appropriate distributor who has a
complimentary line of products.  The estimated time to market is
approximately three to five years; however, because of the nature of the
process, there can be no assurance as to the actual timing or success of the
process.  6      Existing sales of nitric oxide gas are
over $300 million per year at very high dosage costs.  We expect to
significantly expand this market by reducing the per unit dosage costs.  It
is of importance to note that although international markets will follow the
lead of the FDA on matters concerning the sale of pharmaceuticals in their
countries, each country will have their own regulatory requirements to which we
plan to comply.  Market strategy is linked
to the key users of our products during clinical trials.  Early innovators
will be sought to use our products in trials.  The early innovators are the
best word of mouth advertisers in the medical community.  We intend to
secure the services of several key individuals who may be specifically helpful
in advancing our sales and marketing opportunities.  Management anticipates that
the non-medical laboratory use of the generator will create direct to customer
contacts and create interest within the nitric oxide market to gain interest in
our products by demonstration and use. Management plans to engage a distributor
to handle our marketing and distribution when appropriate.  Competitive Business
Conditions  We are entering the medical
device and therapy business.  Although competitive, there are certain
protections allowed an FDA approved drug.  When approval is given, by
default, other competitors are excluded because of the high costs of obtaining the approval as well as the
futility of duplicating the same drug application, as investment in the same
drug would be unprofitable duplication.  Patents also inhibit competition.
 Additionally, our anticipated low production cost of nitric oxide gas may
inhibit competitors from entry into the market.  Production costs of the
compound are expected to be a fraction of current industry costs.  Regardless, we expect that
all of our products under development will face intense competition from
existing and future products marketed by large companies, including our
generators and our proprietary compound formulation of tablets utilized to
produce nitric oxide gas.  For risks associated with patent rights and
other proprietary rights, see the Risk Factor, We Face Intense Competition in
the Markets Targeted by Our Products; Most All of Our Competitors Have
Substantially Greater Resources than We Do and Have Been in Business Longer Than
We Have; and We Expect That All of Our Products Candidates under Development
Will Face Intense Competition from Existing or Future Drugs or Applications,
Many of Which May Rely on Nitric Oxide as a Primary Source, below, under the
caption RISK FACTORS.  Nitric oxide is sold commercially by most major
gas companies as a specialty gas mixture and calibration gas.  Most of
these gases are not medical use gases. The major competitors in this industry
are Praxair (Union Carbide), Airgas, Air Liquide (Liquid Air), AGA (Europe),
British Oxygen and Mattheson Gas.  Extensive research is
currently being done by numerous pharmaceutical companies, colleges and
universities on various treatments utilizing nitric oxide gas.  Over 80,000
articles have been published on various nitric oxide experiments and another
4,000 to 5,000 are being published yearly.  Findings of these studies will
only increase the current competition in this field for medical uses of nitric
oxide.  Sources and Availability
of Raw Materials and Names of Principal Suppliers  The substances that make up
our proprietary compound formulation of tablets that will be utilized to produce
nitric oxide gas in our generators are common substances that are available from
a number of sources.  Dependence on One or a
Few Major Customers  It is not presently
anticipated that we will be dependent upon one or a few major customers for our
success or for the sale of our products.  We believe the markets
for nitric oxide gas are wide and varied and will continue to grow.  If our
technology is successful in producing low cost nitric oxide gas for non-medical
use and for use in the treatment of human diseases and maladies as outlined
above, management believes that the use of nitric oxide gas will increase
substantially.  7      Patents, Trademarks,
Licenses, Franchises, Concessions, Royalty Agreements or Labor Contracts  We have
and have succeeded to the following rights with respect to our products:  · Nitric Oxide Gas Generator, Canadian
Patent Application, Serial Number 2,413,834, Filed December 10, 2002;  · Nitric Oxide Gas Generator, U. S.
Patent Application, Serial No. 10/733,805, Filed December 10, 2003; Allowed,
January 29, 2007;  · Medical Gas Generator, U. S. Design
Application, Serial No. 29/204,287, Filed April 27, 2004; and  · Medical Gas Generator, Canadian
Design Registration, Patent No. 104685, Issued November 23, 2004;  Management intends to
continue filing patent applications or other applications that may protect our
proprietary compound formulation of tablets that will be utilized to produce
nitric oxide gas in our generators as the need arises. Following further
development of the generator and formulation of the compound, we anticipate
filing patent applications in the United States, Canada and other foreign
countries, as appropriate. See Part II, Item 6, specifically, the heading Plan
of Operation.  For risks associated with
patent rights and other proprietary rights, see the Risk Factors, If We Fail to
Protect Our Technology, Our Ability to Pursue the Development of Our
Technologies and Products Would Be Negatively Affected, We Have Not Commissioned an Extensive
Investigation Concerning Our Freedom to Practice or the Validity or
Enforceability of Our Technology or Product Candidates, and We May Be Held to
Infringe the Intellectual Property Rights of Others and We May Be Involved in
Lawsuits to Protect or Enforce Our Patents, Which Could Be Expensive and Time
Consuming, under the caption RISK FACTORS, below.  Need for Governmental
Approval of Principal Products or Services  One of our corporate
strategies is to produce nitric oxide gas for use in the treatment of human
diseases and maladies. Those applications will require FDA approval, which
approval process may be expected to take many years; approval is never assured,
and the process is very time consuming and costly. We do not presently have the
funds available for these purposes, and no assurance can be given that we will
be able to raise the required funding for these planned applications of our
products.  The following is a brief
summary of applicable governmental regulations to which we may be subject in our
planned business operations that relate to the use of our products in the
treatment of humans.  Regulation by governmental
authorities in the United States and other countries is a significant factor
affecting the timing required for the commercialization of our generator and our
nitric oxide tablet product.  Human use of either will require regulatory
approval by governmental agencies prior to commercialization.  Various laws
and regulations govern or influence the research and development, manufacturing,
safety, labeling, storage, record keeping and marketing of our products.
 The lengthy process of seeking and obtaining these approvals, and the
subsequent compliance with applicable laws and regulations require the
expenditure of substantial resources.  Any failure to obtain or maintain,
or any delay in obtaining or maintaining, regulatory approvals could materially
adversely affect our business.  Our policy will be to conduct our research
and development activities in compliance with current FDA guidelines, and with
comparable guidelines in other countries where we may be conducting clinical
trials or other developmental activities.  Clinical testing,
manufacturing and marketing of human pharmaceutical products requires prior
approval from the FDA and comparable agencies in foreign countries.  This
process can be both lengthy and costly and the results are uncertain.  The
FDA has established mandatory procedures and safety and efficacy standards that
apply to the  8     testing, manufacture and
marketing of such products in the United States.  In the United States,
these procedures include pre-clinical studies, request for designation, FDA
registration, the filing of an Investigational New Drug Application (IND) or
equivalent, human clinical trials and approval of a New Drug Application
(NDA).  The results of pre-clinical testing, which include laboratory
evaluation of product chemistry and animal studies to assess the potential
safety and efficacy of the product and its formulations, must be submitted to
the FDA as part of an IND that must be reviewed before clinical testing can
begin.  Clinical trials generally involve a three-phase process:  · Phase I trials are conducted in
volunteers or patients to determine the early side effect profile and, perhaps,
the pattern of drug absorption, distribution and metabolism;  · Phase II trials are conducted in
groups of patients with a specific disease in order to determine appropriate
doses and dose regimens, expand evidence of the safety profile and, perhaps,
determine preliminary efficacy; and;  · Phase III trials are large scale,
comparative trials that are conducted on patients with a target disease in order
to generate enough data to provide the statistical proof of efficacy and safety
required by national regulatory  agencies.  The results of the
preclinical and clinical testing are then submitted to the FDA in the form of an
NDA for approval to commence commercial sales.  The FDA may, in responding
to an NDA, grant marketing approval, request additional information or deny the
approval if it determines that the NDA does not provide an adequate basis for
approval. Among the conditions for an NDA approval is the requirement that the
prospective manufacturers quality control and manufacturing procedures conform,
on an ongoing basis with current Good Manufacturing Practices (cGMP). In
complying with cGMP, we must continue to expend time, money and effort in the
areas of production and quality control to ensure full compliance, or we must
engage the services of outside contractors who are well versed in compliance
with these requirements.  Following approval of the NDA, we are subject to
periodic inspections by the FDA.  Any determination by the FDA of
manufacturing deficiencies could materially adversely affect our business.  It is not presently
anticipated that we will be manufacturing our generator or our nitric oxide
tablet; we intend to develop our products through testing and then to contract
the manufacture, sale or license of those products.  European countries
generally follow the same regulatory approval procedures.  The European
Union has established a unified filing system administered by the Committee for
Proprietary Medicinal Products (CPMP) designed to reduce the administrative
burden of processing applications for pharmaceutical products derived from new
technologies.  Following CPMP review and approval, marketing applications
are submitted to member countries for final approval and pricing approval, as
appropriate.  In addition to obtaining regulatory approval of products, it
is generally necessary to obtain regulatory approval of the facility in which
the product will be manufactured.  The approval process for medical devices
in Europe is similar but is administered by private certification organizations
known as Notified Bodies, which are accredited by each member state of the
European Union.  The receipt of regulatory approvals often takes a number
of years, involves the expenditure of substantial resources and depends on a
number of factors, including the severity of the disease in question, the
availability of alternative treatments and the risks and benefits demonstrated
in clinical trials.  On occasion, regulatory authorities may require larger
or additional studies, leading to unanticipated delay or expense.  There
can be no assurance that any approval will be granted to us, and, even if
granted, such approval may be withdrawn if compliance with regulatory standards
is not maintained.  In addition, the regulatory approval processes for
products in the U.S., European countries and other countries around the world
is undergoing or may undergo changes, and we cannot predict what effect any
changes in the regulatory approval process may have on our business.  In addition to the
foregoing, our present and future business may be subject to various laws and
regulations relating to safe working conditions, clinical, laboratory and
manufacturing practices, the experimental use of animals and the use and disposal of hazardous or potentially
hazardous substances, including radioactive compounds and infectious disease
agents, used in connection with our research, as well as national restrictions
on technology  9     transfer, and import, export
and customs regulations and similar laws and regulations in foreign
countries.  Effect of Existing or
Probable Governmental Regulations on Business  The following regulations
are applicable to us:  Sarbanes-Oxley
Act  On July 30, 2002, President
Bush signed into law the Sarbanes-Oxley Act of 2002 (the Sarbanes-Oxley Act).
 The Sarbanes-Oxley Act imposes a wide variety of new regulatory
requirements on publicly-held companies and their insiders.  Many of these
requirements will affect us.  For example:  · Our chief executive officer and chief
financial officer must now certify the accuracy of all of our periodic reports
that contain financial statements;  · Our periodic reports must disclose
our conclusions about the effectiveness of our disclosure controls and
procedures, and;  · We may not make any loan to any
director or executive officer and we may not materially modify any existing
loans.  The Sarbanes-Oxley Act has
required us to review our current procedures and policies to determine whether
they comply with the Sarbanes-Oxley Act and the new regulations promulgated
thereunder.  We will continue to monitor our compliance with all future
regulations that are adopted under the Sarbanes-Oxley Act and will take whatever
actions are necessary to ensure that we are in compliance.  Penny Stock  Our common stock is penny
stock as defined in Rule 3a51-1 of the Securities and Exchange Commission.
 Penny stocks are stocks:  · with a price of less than five
dollars per share;  · that are not traded on a recognized
national exchange;  · whose prices are not quoted on the
NASDAQ automated quotation system; or  · issued by an issuer with net tangible
assets less than $2,000,000, if the issuer has been in continuous operation for
at least three years or $5,000,000, if in continuous operation for less than
three years, or with average revenues of less than $6,000,000 for the last three
years.  Section 15(g) of the
Securities Exchange Act of 1934, as amended (the Exchange Act), and Rule 15g-2
of the Securities and Exchange Commission promulgated thereunder require
broker/dealers dealing in penny stocks to provide potential investors with a
document disclosing the risks of penny stocks and to obtain a manually signed
and dated written receipt of the document before making any transaction in a
penny stock for the investors account.  You are urged to obtain and read
this disclosure carefully before purchasing any of our shares.  Rule 15g-9 of the
Securities and Exchange Commission requires broker/dealers in penny stocks to
approve the account of any investor for transactions in these stocks before
selling any penny stock to that investor.  This procedure requires the
broker/dealer to:  · obtain information about the
investors financial situation, investment experience and investment goals;  10      · reasonably determine, based on that
information, that transactions in penny stocks are suitable for the investor and
that the investor can evaluate the risks of penny stock transactions;  · provide the investor with a written
statement setting forth the basis on which the broker/dealer made his or her
determination; and  · receive a signed and dated copy of
the statement from the investor, confirming that it accurately reflects the
investors financial situation, investment experience and investment goals.  Compliance with these
requirements may make it harder for our stockholders to resell their shares.  Reporting
Obligations  Section 14(a) of the
Exchange Act requires all companies with securities registered pursuant to
Section 12(g) of the Exchange Act to comply with the rules and regulations of
the Securities and Exchange Commission regarding proxy solicitations, as
outlined in Regulation 14A.  Matters submitted to our stockholders at a
special or annual meeting thereof or pursuant to a written consent will require
us to provide our stockholders with the information outlined in Schedules 14A or
14C of Regulation 14; preliminary copies of this information must be submitted
to the Securities and Exchange Commission at least 10 days prior to the date
that definitive copies of this information are forwarded to our
stockholders.  We are also required to
file annual reports on Form 10-KSB and quarterly reports on Form 10-QSB with the
Securities Exchange Commission on a regular basis, and will be required to
timely disclose certain material events (e.g., changes in corporate control;
sales of in excess of 5% of our outstanding securities; acquisitions or
dispositions of a significant amount of assets other than in the ordinary course
of business; certain changes in our directors and executive officers; and
bankruptcy) in a current report on Form 8-K.  Smaller Reporting
Company  The integrated disclosure
system for smaller reporting companies adopted by the Securities and Exchange
Commission in Release No. 34-30968 and effective as of August 13, 1992,
substantially modified the information and financial requirements of a Smaller
Reporting Company, defined to be an issuer that has revenues of less than
$25,000,000; is a U.S. or Canadian issuer; is not an investment company; and if
a majority-owned subsidiary, the parent is also a smaller reporting company.
 We are deemed to be a smaller reporting company.  The Securities and Exchange
Commission, state securities commissions and the North American Securities
Administrators Association, Inc. (NASAA) have expressed an interest in
adopting policies that will streamline the registration process and make it
easier for a smaller reporting company to have access to the public capital
markets.  Research and
Development  We have not commenced
planned principal operations.  The development of our business plan and our
Plan of Operation will require substantial expenditures for research and
development of our products, including our generator and our proprietary tablet
formulation for production of nitric oxide gas.  See the Part II, Item 6,
below, specifically, the heading Plan of Operation.  It is estimated that
our predecessors expensed approximately $900,000 in research and development of our Technology
Rights that we acquired under the merger with GeNOsys Nevada.  Cost and Effects of
Compliance with Environmental Laws  We do not anticipate any
material expense for compliance with environmental laws in connection with our
planned or contemplated business operations, as our Plan of Operations details
that we will be using contractors well  11     versed in dealing with the
applicable hazards associated with producing and packaging nitric oxide gas and
other pharmaceuticals.  See the Part II, Item 6, below, specifically, the
heading Plan of Operation.  Number of
Employees  We currently have four
employees and will consider our employment needs as business developments
require.  We anticipate filling most of our needs for services, other than
core employees, through contract organizations and outside agreements with
suppliers of services in the industries of our planned business operations as
may be required.  RISK FACTORS  We are subject to the risks
inherent in any newly formed, undercapitalized and developmental stage company,
including, among other risk factors, the following:  This list of risk
factors is in no way exclusive or all encompassing.  Because our limited
operations have not generated revenues, we require substantial funding to
undertake our Plan of Operation, and we may never generate revenues or, if we
are able to generate revenues, achieve profitability.  We do not currently
have sufficient funding to continue operations through the next year, and
therefore will be dependent upon raising additional funds either through loans
or an additional Private or Public Placement Offering.  We are focused on product
development, and we have not generated any revenues to date utilizing our
Technology Rights.  The process of developing our products requires
significant clinical, development and laboratory testing and clinical trials.
 In addition, commercialization of our products will require that we obtain
necessary regulatory approvals and establish sales and marketing capabilities,
either through internal hiring or through contractual relationships with others.
 We expect to incur substantial losses for the foreseeable future as a
result of anticipated increases in our research and development costs, including
costs associated with conducting preclinical testing and clinical trials and
regulatory compliance activities.  Our ability to generate
revenues and achieve profitability will depend on numerous factors, including
success in:  · developing and testing our
products;  · receiving regulatory approvals;  · commercializing our products; and  · establishing a favorable competitive
position.  Many of these factors will
depend on circumstances beyond our control. We cannot assure that we will ever
bring any product to market or, if we are successful in doing so, that we will
ever become profitable.  Our Products Are Based
on a Technology That Could Ultimately Prove Ineffective  Our products are to be
created using our proprietary Technology Rights. We have not yet conducted
laboratory or animal studies to establish whether the Technology Rights are safe
and effective for all of our intended uses.  Ultimately, our research which
currently indicates that our Technology Rights possess beneficial properties,
may prove to be incorrect.  In this case products made from our Technology
Rights may not differ substantially from existing treatment methods and may in
fact be inferior to them.  If these products are substantially identical or
inferior to treatment methods already available, the market for our products
would be reduced or eliminated.  Our Products Are at an
Early Stage of Development.  If We Are Unable to Develop and Commercialize
Our Products Successfully, We May Never Generate Revenues Or, If We Are Able to
Generate Revenues,  12     Achieve
Profitability  We have not commercialized
any of our products or recognized any revenue from product sales utilizing our
Technology Rights.  All of our proposed products using our Technology
Rights are in early stages of development.  We must conduct significant
additional research and development activities before we will be able to
commercialize any products utilizing our Technology Rights. We must successfully
complete adequate and well-controlled studies designed to demonstrate the safety
and efficacy of the product candidates and obtain regulatory approval before we
are able to commercialize these product candidates for many uses.  We may
not be able to fund all of these programs to completion or provide the support
necessary to perform the clinical trials, seek regulatory approvals or market
any approved products.  Even if we succeed in developing and
commercializing one or more of our products utilizing our Technology Rights, we
may never generate sufficient or sustainable revenue to enable us to be
profitable.  We Face Intense
Competition in the Markets Targeted by Our Products. Most of Our Competitors
Have Substantially Greater Resources than We Do, and We Expect That All of Our
Products Candidates under Development Will Face Intense Competition from
Existing or Future Drugs or Applications, Many of Which May Rely on Nitric Oxide
as a Primary Source  We have not yet devoted
substantial research efforts or capital to the development of our Technology
Rights and our products.  However, even if our future efforts are
successful in this regard, we expect that all of our products under development
will face intense competition from existing and future products marketed by
large companies.  The markets for treatments for many diseases are well
developed and populated with established drugs marketed by large pharmaceutical,
biotechnology and generic drug companies.  Each of these companies has
significantly greater financial and other resources than we do.  If we
obtain regulatory approval to market one or more of our products, we will
compete with these established drugs and will need to show that our products
have safety or efficacy advantages in order to take market share and be
successful for many uses.  If We Lose Our Key
Personnel or Are Unable to Hire Additional Personnel, We Will Have Trouble
Growing Our Business  We will depend to a large
extent on the abilities of our Chief Executive Officer, John W. R. Miller.
 The loss of Mr. Miller, or our inability to attract or retain other
qualified employees, could seriously impair our results of operations and
financial condition.  Our future success depends
on our ability to attract, retain and motivate highly skilled technical,
marketing, management, accounting and administrative personnel.
 Competition for qualified personnel is intense.  As a result, we may
be unable to attract, assimilate or retain qualified personnel.  We may
also be unable to retain the employees that we currently employ, or to attract
additional technical personnel.  The failure to retain and attract the
necessary personnel could seriously harm our business, financial condition and
results of operations.  If We Fail to Protect
Our Technology, Our Ability to Pursue the Development of Our Technologies and
Products Would Be Negatively Affected  Our success will depend in
part on our ability to obtain patents and maintain adequate protection of our
Technology Rights and products.  If we do not adequately protect our
intellectual property, competitors may be able to use our Technology Rights to
produce and market nitric oxide in direct competition with us, thus eroding our
competitive advantage.  Some foreign countries lack rules and methods for
defending intellectual property rights and do not protect proprietary rights to
the same extent as the United States.  Many companies have had difficulty
protecting their proprietary rights in these foreign countries.  We may not
be able to prevent misappropriation of our proprietary rights.  In
addition, patent positions can be uncertain and involve complex legal and
factual questions.  We can protect our proprietary rights from unauthorized
use by third parties only to the extent that our proprietary technologies are
covered by valid and enforceable patents, or are effectively maintained as trade
secrets.  Others may challenge our patents, or our patent applications may
not result in issued patents.  Moreover, any patents issued to us may not
provide us with meaningful protection, or others may challenge, circumvent or
narrow our patents.  13     Third parties may also
independently develop products similar to our products, duplicate our unpatented
products or design around any patents on products we develop.
 Additionally, extensive time is required for the development, testing and
regulatory review of a potential product.  While extensions of patent term
due to regulatory delays may be available, it is possible that, before any of
our product candidates can be commercialized, any related patent, even with an
extension, may expire or remain in force for only a short period following
commercialization, thereby reducing any advantages of the patent.  In addition to patents, we
will rely on a combination of trade secrets, confidentiality, nondisclosure and
other contractual provisions, and security measures to protect our confidential
and proprietary information.  These measures may not adequately protect our
trade secrets or other proprietary information.  If they do not adequately
protect our rights, third parties could use our Technology Rights, and we could
lose any competitive advantage we may have.  In addition, others may
independently develop similar proprietary information or techniques or otherwise
gain access to our trade secrets, which could impair any competitive advantage
we may have.  We Have Not Commissioned
an Extensive Investigation Concerning Our Freedom to Practice or the Validity or
Enforceability of Our Technology Rights or Product Candidates, and We May Be
Held to Infringe the Intellectual Property Rights of Others  Our ability to freely
practice our products may be dependent upon the duration and scope of other
patents held by third parties.  Our patent, prior art and infringement
investigations have been conducted primarily by us. Although we have consulted
with our patent counsel in connection with our Technology Rights investigations,
our patent counsel has not undertaken an extensive independent analysis to
determine whether our Technology or products infringe upon any issued patents,
or whether our patent applications relating to the Technology Rights could be
invalidated or rendered unenforceable for any reason, or could be subject to
interference proceedings.  There may be patents or patent applications of
which we are unaware, and avoiding patent infringement may be difficult.
 We may inadvertently infringe upon third-party patents.  Third-party
patents may impair or block our ability to conduct our business.  There are
no unresolved communications, allegations, complaints or threats of litigation
related to the possibility that we might infringe patents held by others.  Claims may be asserted
against us that our products or Technology Rights infringe patents or other
intellectual property owned by others.  We may be exposed to future
litigation by third parties based on claims that our products or activities
infringe the intellectual property rights of others.  In the event of
litigation, any claims may not be resolved in our favor.  Any litigation or
claims against us, whether or not valid, may result in substantial costs and may
result in an award of damages, lost profits, attorneys fees, and tripling of
those damages in the event that a court finds an infringement to have been
willful.  A lawsuit could also place a significant strain on our financial
resources, divert the attention of management and harm our reputation.  In
addition, intellectual property litigation or claims could force us to do one or
more of the following:  · cease making, selling, offering or
using any products that infringe a third partys intellectual property through
an injunction;  · obtain a license or an assignment
from the holder of the infringed intellectual property right, which license or
assignment may be costly or may not be available on reasonable terms, if at all;
and  · redesign our products, which would be
costly and time-consuming, and may not be possible.   We May Be Involved in
Lawsuits to Protect or Enforce Our Patents, Which Could Be Expensive and Time
Consuming  Competitors may infringe
upon our patents, if and when filed and granted, and we may file infringement
claims to counter infringement or unauthorized use. This can be expensive,
particularly for a company of our size, and time-consuming.  In addition,
in an infringement proceeding, a court may decide that a patent of ours is not
valid or  14     is unenforceable, or may
refuse to stop the other party from using the technology at issue on the grounds
that our patents do not cover our Technology Rights.  An adverse
determination of any litigation or defense proceeding could put one or more of
our patents at risk of being invalidated or interpreted narrowly.  Also, a third party may
assert that our patents are invalid and/or unenforceable.  There are no
unresolved communications, allegations, complaints or threats of litigation
related to the possibility that our patent applications are invalid or
unenforceable.  Any litigation or claims against us, whether or not
merited, may result in substantial costs, place a significant strain on our
financial resources, divert the attention of management and harm our reputation.
 An adverse decision in litigation could result in inadequate protection
for our products and/or substantially reduce our ability to effectuate our
business plan.  Interference proceedings
brought before the U.S. Patent and Trademark Office may be necessary to
determine priority of invention with respect to our patents or patent
applications.  During an interference proceeding, it may be determined that
we do not have priority of invention for one or more aspects in our patents or
patent applications, and could result in the invalidation in part or whole of
a patent, or could put a patent application at risk of not issuing.  Even
if successful, an interference proceeding may result in substantial costs and
distraction to our management.  Furthermore, because of the
substantial amount of discovery required in connection with intellectual
property litigation or interference proceedings, there is a risk that some of
our confidential information could be compromised by disclosure.  In
addition, there could be public announcements of the results of hearings,
motions or other interim proceedings or developments.  If investors
perceive these results to be negative, the price of our common stock in any
market that may develop for it could be adversely affected.  We Intend to Rely on
Third Parties to Manufacture the Compounds Used in One or More of Our Products.
 If These Third Parties Do Not Manufacture Our Product in Sufficient
Quantities and at an Acceptable Cost, Development and Commercialization of Our
Product Candidates Could Be Delayed, Prevented or Impaired  We have no manufacturing
facilities, and we have no experience in the clinical or commercial-scale
manufacture of drugs, or in designing drug manufacturing processes.  We
expect that certain specialized manufacturers will provide us with
pharmaceutical compounds.  We do not have any short-term or long-term
manufacturing agreements with any of these manufacturers.  If we fail to
contract for manufacturing on acceptable terms or if third-party manufacturers
do not perform as we expect, our development programs could be materially
adversely affected.  We intend to rely on third
parties to manufacture some or all of our products that reach commercialization.
 We believe that there are a variety of manufacturers that we may be able
to retain to produce these products. However, once we retain a manufacturing source, if our
manufacturers do not perform in a satisfactory manner, we may not be able to
develop or commercialize potential products as planned.  Failure by Our
Third-party Manufacturers to Comply with the Regulatory Guidelines Set Forth by
the FDA with Respect to Our Products Could Delay or Prevent the
Commercialization of Our Products  Our reliance on third-party
manufacturers will expose us to the following additional risks, any of which
could delay or prevent the completion of our clinical trials, the approval of
our products by the FDA for some uses or other regulatory agencies or the
commercialization of our products, result in higher costs or deprive us of
potential product revenues:  · Manufacturers are obligated to
operate in accordance with FDA-mandated cGMP requirements. A failure of any of
our third-party manufacturers to establish and follow cGMP requirements and to
document their adherence to such practices may lead to significant delays in the
availability of our products for commercial distribution.   15     · Replacing our third-party
manufacturers or contracting with additional manufacturers may require
re-validation of the manufacturing processes and procedures in accordance with
cGMP and compliance with supplemental approval requirements. Any such necessary
re-validation and supplemental approvals may be costly and time-consuming.  · Drug manufacturers are subject to
ongoing periodic unannounced inspections by the FDA and corresponding state and
foreign agencies to ensure strict compliance with cGMP requirements and other
requirements under federal drug laws, other government regulations and
corresponding foreign standards.  If our third-party manufacturers or we
fail to comply with applicable regulations, sanctions could be imposed on us,
including fines, injunctions, civil penalties, seizures or recalls of product,
operating restrictions and criminal prosecutions.  We believe that our
contracted sources are cGMP qualified. See the heading Business Development,
of this Item 1.  Our Products May Not Be
Accepted by the Market  Our products may not gain
market acceptance among physicians, patients, healthcare providers, insurance
companies and the medical community in general.  The degree of market
acceptance of any pharmaceutical product that we develop will depend on a number
of factors, including:  · cost-effectiveness;  · the safety and effectiveness of our
products, including any potential side effects, as compared to alternative
products or treatment methods;  · the timing of market entry as
compared to competitive products;  · the rate of adoption of our products
by doctors and nurses;  · product labeling or product insert
required by the FDA for each of our products;  · reimbursement policies of government
and third-party payors;  · effectiveness of our sales, marketing
and distribution capabilities and the effectiveness of such capabilities of our
collaborative partners, if any; and  · unfavorable publicity concerning our
products or any similar products.  Our products, if
successfully developed, will compete with a number of products manufactured and
marketed by major pharmaceutical companies, biotechnology companies and
manufacturers of generic drugs.  Our products may also compete with new
products currently under development by others.  Physicians, patients,
third-party payors and the medical community may not accept and utilize any of
our product candidates.  Physicians may not be inclined to prescribe the
treatment methods created utilizing our Technology Rights unless our products
bring substantial and demonstrable advantages over other products currently
marketed for the same indications.  If our products do not achieve market
acceptance, we will not be able to generate significant revenues or become
profitable.  If We Fail to Establish
Marketing, Sales and Distribution Capabilities, or Fail to Enter into
Arrangements with Third Parties, We Will Not Be Able to Create a Market for Our
Product Candidates  Our strategy with our
products is to control, directly or through contracted third parties, all or
most aspects of the product development process, including marketing, sales and
distribution.  Currently, we do not have any sales, marketing or
distribution capabilities.  In order to generate sales of any product
candidates, we must either acquire  16     or develop an internal
marketing and sales force with technical expertise and with supporting
distribution capabilities or make arrangements with third parties to perform
these services for us.  The acquisition or development of a sales and
distribution infrastructure would require substantial resources, which may
divert the attention of our management and key personnel and defer our product
development efforts.  To the extent that we enter into marketing and sales
arrangements with other companies, our revenues will depend on the efforts of
others.  These efforts may not be successful.  If we fail to develop
sales, marketing and distribution channels, or enter into arrangements with
third parties, we will experience delays in product sales and incur increased
costs.  In the Event That We Are
Successful in Bringing Any Products to Market, Our Revenues May Be Adversely
Affected If We Fail to Obtain Acceptable Prices or Adequate Reimbursement for
Our Products from Third-party Payors  Our ability to
commercialize pharmaceutical products successfully may depend in part on the
availability of reimbursement for our products from:  · government and health administration
authorities;  · private health insurers; and  · other third party providers or
payors, including Medicare.  We cannot predict the
availability of reimbursement for health care products.  Third-party
payors, including Medicare, are challenging the prices charged for medical
products and services.  Government and other third-party payors are increasingly limiting both coverage and the
level of reimbursement for new drugs.  Third-party insurance coverage may
not be available to patients for any of our products.  The continuing efforts of
government and third-party payors to contain or reduce the costs of health care
may limit our commercial opportunity.  If government and other third-party
payors do not provide adequate coverage and reimbursement for any product we
bring to market, doctors may not prescribe them, or patients may ask to have
their physicians prescribe competing drugs with more favorable reimbursement.
 In some foreign markets, pricing and profitability of prescription
pharmaceuticals are subject to government control.  In the United States,
we expect that there will continue to be federal and state proposals for similar
controls.  In addition, we expect that increasing emphasis on managed care
in the United States will continue to put pressure on the pricing of
pharmaceutical products.  Cost control initiatives could decrease the price
that we receive for any products in the future. Further, cost control
initiatives could impair our ability to commercialize our products and our
ability to earn revenues from this commercialization.  We Could Be Forced to
Pay Substantial Damage Awards If Product Liability Claims That May Be Brought Against Us Are
Successful  We may be exposed to
liability claims and financial losses resulting from the use or sale of our
products.  We may not be able to maintain insurance coverage at a
reasonable cost or in sufficient amounts or scope to protect us against
losses.     Item 2.  Description of Property.  Our executive offices are
located at 280 W. Riverpark Drive, Provo, Utah 84604.  We lease
approximately 2,600 square feet at a lease price of $4,850 per month.  The
lease agreement provides for increases of 2.5% on each anniversary date of the
agreement term.  At November 2007, the monthly lease is $4,971.25 per
month.  Our lease is for a period of five years, commencing in November,
2006.  In addition, our original facility space, located at 5063 Riverpark
Way, Provo, Utah 84604 is being utilized for our research and development.
 It is a month-to-month lease with a monthly payment of $1,600.   17     Our
current office space will not be adequate to meet the needs of our expected
growth.  We will require additional office and/or laboratory facilities in
the future to facilitate additional personnel and enable us to execute our
business plan.     Item 3.  Legal Proceedings.  We are not a party to any
pending legal proceeding and, to the knowledge of management, no federal, state
or local governmental agency is presently contemplating any proceeding against
us.  No director, executive officer or affiliate of ours, or owner of
record of beneficially more than five percent of our common stock is a party
adverse to us or has a material interest adverse to us in any proceeding.  Litigation to enforce our
patents, to protect our proprietary information, or to defend us against alleged
infringement of the rights of others may occur.  Such litigation would be
costly, could divert our resources from other planned activities, and could have
a material adverse effect on our results of operations and financial
condition.     Item 4.  Submission of Matters to a Vote of
Security Holders.  We have had no matters
submitted to a vote of security holders during the fourth quarter of the fiscal
year ended November 30, 2007.         [REMAINDER OF PAGE
INTENTIONALLY LEFT BLANK]  18     PART II     Item 5.  Market for Common Equity, Related
Stockholder Matters and Smaller Reporting Company Purchases of Equity
Securities.  Share Price
History  Our common stock is traded
on the OTC Bulletin Board of the Financial Industry Regulatory Authority
(FINRA) under the symbol GNYS.  The following table sets forth the high
and low bid information of our common stock for the periods indicated.  The
price information contained in the table was obtained from Google Finance.
 Note that the over-the-counter market quotations reflect inter-dealer
prices, without retail mark-up, markdown or commissions, and that the quotations
may not necessarily represent actual transactions in the common stock.  STOCK QUOTATIONS (BID) *  2007
2006Quarter
ended
High
Low
High
LowFebruary 28
$1.45
$0.86
$3.60
$3.05May 31
$0.94
$0.60
$3.60
$2.50August 31
$0.76
$.60
$2.50
$2.00November 30
$0.85
$0.58
$2.05
$1.43  *    The future sale
of our presently outstanding restricted securities (common stock) by present
members of management and others may have an adverse effect on any market in the
shares of our common stock.  Holders of
Record  At February 22, 2008, there
were approximately 216 holders of record of our common stock.  The number
of holders of record was calculated by reference to our stock transfer agents
books.  Dividend Policy  To date, we have not paid
dividends on our common stock.  The payment of dividends on our common
stock, if any, is at the discretion of our board of directors and will depend
upon our earnings, if any, our capital requirements and financial condition, and
other relevant factors.  See Item 6. Managements Discussion and Analysis
or Plan of Operation.  We do not intend to declare any dividends in the
foreseeable future, but instead intend to retain all earnings, if any, for use
in our operations.  Issuance of Restricted
Securities  We issued 40,000,000 shares
of our common stock in the merger with GeNOsys Nevada that was completed on
August 18, 2005.  For a complete accounting of the issuance of these
shares, see our Statement of Stockholders Deficit in our audited financial
statements contained herein.  Effective on or about
November 1, 2005, we completed the private sale of 3,964,031 shares (this amount
includes 64 shares for rounding) of our common stock at a price of $0.60 per
share for aggregate gross proceeds of  19     approximately $2.38
Million.  On January 31, 2006, we
issued 450,000 shares to Smith Consulting Services, Inc. (SCS), a Utah
corporation and financial consulting firm to us, in replacement of 450,000
shares that SCS had conveyed to two of our consultants and one attorney for
services that were rendered for our benefit from the shares that SCS received
under our merger with GeNOsys Nevada.  These consultants and the one
attorney provided services to SCS under its Consulting Agreement with GeNOsys
Nevada.  For a complete accounting of the issuance of these shares, see our
Statement of Stockholders Deficit in our audited financial statements contained
herein.  On or about November 30,
2007, we completed the private sale of 213,569 shares of our common stock at a
price of $0.70 per share for aggregate gross proceeds of $149,500.  We issued these securities
to persons who were either accredited investors, or sophisticated investors,
who, by reason of education, business acumen, experience or other factors, were
fully capable of evaluating the risks and merits of an investment in our
Company; and each had prior access to all material information about us.
 We believe that the offer and sale of these securities was exempt from the
registration requirements of the Securities Act of 1933, as amended (the
Securities Act), pursuant to Sections 4(2) and 4(6) thereof, and Rule 506 of
Regulation D of the Securities and Exchange Commission and from various similar
state exemptions, and with respect to the foreign investors, pursuant to
Regulation S of the Securities and Exchange Commission.  Use of Proceeds of
Registered Securities  There have been no sales of
registered securities by us.  Securities Authorized
for Issuance under Equity Compensation Plans  We have no equity
compensation plans.  Purchases of Company
Equity Securities  There were no purchases of
our equity securities by us or any affiliated purchasers during the calendar
year ended November 30, 2006; however, SCS canceled 1,302,500 shares of the
3,800,000 shares it acquired under the GeNOsys Nevada merger, based upon its understanding with
principals of GeNOsys Nevada in their Consulting Agreement that if it were able
to purchase any of our shares that were already outstanding and owned by former
principals or others following the merger, that it would cancel a like number of
such shares so that the number of shares that SCS was entitled to under such
Consulting Agreement would remain unchanged.  SCS purchased 1,302,500
shares of our common stock from two former principals and three non-affiliated
persons for cash on or about August 25, 2005, and executed and delivered certain
Lock-Up/Leak-Out Agreements that restricted the sale of these purchased
shares.  Effective January 31,
2006, we waived the provisions of these Lock-Up/Leak-Out Agreements so that SCS
could privately sell an aggregate of 413,044 shares, the resale of which were
covered thereby for the aggregate sum of $250,000 to a limited number of persons
who were believed to be accredited investors or sophisticated investors as
defined in Regulation D and/or Rule 506 of the Securities and Exchange
Commission; and to make gifts of 61,635 shares to five persons who were also
believed to be accredited investors or sophisticated investors.  The
Lock- Up/Leak-Out Agreements that had been executed by SCS with respect to the
remaining 827,821 of these shares that are currently still owned by SCS were
reaffirmed; these Lock-Up/Leak-Out Agreements expired on or about August 24,
2006.  See the Schedule 13D, the
Schedule 13DA-1 and the Schedule 13DA-2 filed by SCS with the Securities and
Exchange Commission for additional information about these share purchases.     20     Item 6.  Managements
Discussion and Analysis or Plan of Operation.  The following discussion
and analysis provides information which management believes is relevant to an
assessment and understanding of our results of operations and financial
condition.  The discussion should be read in conjunction with the financial
statements and notes thereto.  Overview  We are in the development
stage and have incurred cumulative net losses since inception.  We incurred
negative cash flows from operating activities of $721,217 and $928,751 for the
years ended November 30, 2007 and 2006, respectively.  Our products are in
the development stage and are subject to regulatory approval by the Food and
Drug Administration.  Although we are confident that the products under
development will be successfully tested and commercialized, there can be no
assurance that such approvals will be received.  Development work to date
is detailed below.  In the first 12 months, we
contracted with a pharmaceutical formulation development laboratory, to improve
the formulation and deliver the first nitric oxide generating tablets produced
under good laboratory practices (GLP) guidelines. This was done in preparation
for application to the FDA for approval. In accordance with initial plans, we
have continued discussions with qualified groups concerning clinical trials, but
no agreements have been executed.  In the first 12 months, we successfully
obtained a five-year lease for office space in which to headquarter our
operations, and have hired staff to begin the creation of an FDA Quality System
and ISO 13485 compliance.  Over the next 12 to 24
months, we plan to pursue various levels of the international regulatory
approval process. Applications and product opportunities for nitric oxide
generators are believed to be broad and cover a wide range of commercial fields,
each with a distinct pre-market requirement.  We plan to seek the most
effective regulatory paths to market.  We plan to approach a contracted
supplier to produce a device capable of meeting FDA guidance document
requirements for a nitric oxide system.  We will also continue to seek and
hire qualified staff necessary to implement the FDA- required Quality System
throughout all levels of the operation.  We plan to enter the non-clinical
laboratory market with products produced by outside contractors. In order to
maintain protection of proprietary, intellectual property, we will continue
securing patents for all developed and developing technology.  Our ability to carry out
our plan depends entirely upon our ability to obtain additional substantial
equity, debt financing or royalties.  We cannot assure you that we will
receive this financing. If we do not receive such funding, we will not be able
to proceed with our intended business plans.  We completed the private
sale of 3,964,031 shares (this amount includes 64 shares for rounding) of our
common stock at a price of $0.60 per share for aggregate gross proceeds of
approximately $2.38 Million during November, 2005.  During November 2007 we
completed the private sale of 213,569 shares of our common stock at a price of
$0.70 per share for aggregate gross proceeds of $149,500.  Substantial
additional funds will still be required if we are to reach our goals that are
outlined above.  We currently have no arrangements or understandings that
will assure that we can successfully raise any additional funds that may be
required.  Critical Accounting
Policies  Revenue
Recognition  Pursuant to Staff
Accounting Bulletin (SAB) No. 104, Revenue Recognition, we will recognize
revenue when the following criteria have been met: (1) persuasive evidence of an
arrangement exists, (2) delivery has occurred or services have been rendered, (3) the price is
fixed or determinable and (4) collectability is reasonably assured.  Product revenues will be
recognized when persuasive evidence of an arrangement exists, risk of loss and
title has transferred to our customers, the fee is fixed or determinable and
collection is probable.  Rights of return for  21     manufactured product are
dependent upon the agreement.  Long-Lived
Assets  We regularly evaluate
whether events or circumstances have occurred that indicate the carrying value
of our long-lived assets may not be recoverable.  When factors indicate the
asset may not be recoverable, we compare the related undiscounted future net
cash flows to the carrying value of the asset to determine if impairment exists.
 If the expected future net cash flows are less than the carrying value, an
impairment charge is recognized based on the fair value of the asset.  No
such impairments were recorded during the years ended November 30, 2006 and
2005.  Capitalization of Patent
Costs  We have elected to
capitalize patent costs and will amortize them over the shorter of the life of
the patent or the number of years for which it is estimated that economic
benefit will be derived.  Stock Based
Compensation  On March 23, 2007, the
GeNOsys, Inc. 2007 Stock Option Plan (Stock Option Plan) was approved by the
Board of Directors and became effective on that date, subject to the Stock
Option Plan being approved by the stockholders at the annual meeting.  On
June 27, 2007, the stockholders approved the Stock Option Plan.  The Stock
Option Plan provides that 3,000,000 shares of our authorized but unissued common
stock be reserved pursuant to the terms and conditions of the Stock Option Plan.
 The Stock Option Plan allows us, under the direction of the Compensation
Committee, to make broad-based grants of stock options, any of which may or may
not require the satisfaction of performance objectives, to employees and
non-employee directors.  The purpose of these stock option grants is to
attract and retain talented employees and further align employee and stockholder
interests.  The Stock Option Plan provides an essential component of the
total compensation package offered to employees, reflecting the importance that
we place on motivating and rewarding superior results with long-term,
performance-based incentives.  In March, June and November, 2007, the Board
of Directors approved the grant of an aggregate of 1,200,000 stock option grants
to certain employees and directors, resulting in non-cash charges of $632,058,
which is being expensed ratably over the vesting periods of the individual
agreements.  The total non-cash charge to expense for the year ended
November 30, 2007, relating to these stock option grants was $138,740.  Off-Balance Sheet
Arrangements  We do not have any
off-balance sheet arrangements that have or are reasonably likely to have a
current or future effect on our financial condition, changes in financial
condition, revenues or expenses, results of operations, liquidity, capital
expenditures or capital resources that are material to investors.  Recent Accounting
Pronouncements  In February 2007, the FASB
issued SFAS No. 159, The Fair Value Option for Financial Assets and Financial
Liabilities Including an Amendment of SFAS No. 115, Accounting for Certain
Investments in Debt and Equity Securities.  SFAS 159 allows entities to
choose, at specified election dates, to measure eligible financial assets and
liabilities at fair market value in situations in which they are not otherwise
required to be measured at fair value.  If a company elects the fair value
option for an eligible item, changes in that items fair value in subsequent
reporting periods must be recognized in current period earnings.  SFAS No.
159 also establishes presentation and disclosure requirements designed to draw
comparison between entities that elect different measurement attributes for
similar assets and liabilities.  SFAS No. 159 is effective for fiscal years
beginning after November 15, 2007.  We are evaluating the impact of the
adoption of SFAS No. 159 on our consolidated financial statements.  In December 2007, the FASB
issued SFAS No. 141 (revised 2007), Business Combinations (SFAS No. 141R).
 SFAS No. 141R expands the definition of a business combination and
requires the fair value of the purchase price of an acquisition, including the
issuance of equity securities, to be determined on the acquisition date.  22     SFAS No. 141R also requires
that all assets, liabilities, contingent considerations, and contingencies of an
acquired business be recorded at fair value at the acquisition date.  In
addition, SFAS No. 141R requires that acquisition costs generally be expensed as
incurred, restructuring costs generally be expensed in periods subsequent to the
acquisition date and changes in accounting for deferred tax asset valuation
allowances and acquired income tax uncertainties after the measurement period
impact income tax expense.  SFAS No. 141R is effective for our fiscal years
beginning on or after December 15, 2008, with early adoption prohibited.
 We are evaluating the effect the implementation of SFAS No. 141R will have
on our consolidated financial statements.  In December 2007, the FASB
issued SFAS No. 160, Non-controlling Interests in Consolidated Financial
Statements, an Amendment of ARB No.51 (SFAS No. 160).  SFAS No. 160
requires minority interests to be recharacterized as non-controlling interests
and reported as a component of equity.  In addition, SFAS No. 160 requires
that purchases or sales of equity interests that do not result in a change in
control to be accounted for as equity transactions and, upon a loss of control,
requires the interests sold, as well as any interests retained, to be recorded
at fair value with any gain or loss recognized in earnings.  SFAS No. 160
is effective for fiscal years beginning on or after December 15, 2008, with
early adoption prohibited.  No material impact on our financial statements
is expected from the adoption of this standard.  We have reviewed all other
recently issued, but not yet adopted, accounting standards in order to determine
their effects, if any, on our consolidated results of operation, financial
position or cash flows.  Based on that review, we believe that none of
these pronouncements will have a significant effect on our current or future
earnings or operations.  Financial
Position  We had $280,105 in cash as
of November 30, 2007.  This is a decrease of $624,610 from November 30,
2006.  Working capital as of November 30, 2007, was $243,079 as compared to
$928,942 at November 30, 2006.  This decrease was largely due to the
operating loss for the fiscal year, coupled with capital expenditures.  Years Ended November 30,
2007 and 2006  During the years ended
November 30, 2007 and 2006, we had no revenue or related cost of sales.  Year Ended November 30, 2007
Year Ended November 30, 2006
Increase (Decrease)Research and Development (excludes $33,747 of
non-cash stock compensation expense in 2007
$ 455,579
$ 730,131
$(274,552)General and Administrative (excludes $104,993 of
non-cash stock compensation expense in 2007)
395,408
506,801
(111,393)Stock-based compensation expense
138,740
-
138,740Total
$989,843
$ 1,236,932
$(247,205)  Research and development
expenses (R&D) for the year ended November 30, 2007, were $489,326, which
includes $33,747 of stock-based compensation expense.  R&D expenses for
the year ended November 30, 2006, were $730,131, a decrease of $240,805.  A
comparison of research and development expenses excluding the stock-based
compensation expense shows a decrease in 2007 expenses of $274,552.  The
decrease in expenses in 2007 is related to the completion of the contract work
by IriSys and reduced travel expenses related to that work.  It is
anticipated that R&D expenses will significantly increase as final design
work on the generator is completed, the formulation of the tablet is finalized,
testing required for FDA applications is made and the development work  23     required for commercialization
escalates.  General and administrative
expenses for the year ended November 30, 2007, were $500,401, which includes
$104,993 of stock-based compensation expense, compared to $506,801 for the year
ended November 30, 2006, a decrease of $6,400.  A comparison of general and
administrative expenses excluding the stock-based compensation expense shows a
decrease in 2007 expenses of $111,393.  The hiring of additional personnel,
travel expenses, office rental, and other administrative expenses is expected to
increase throughout 2008.  Interest income of $21,687
was realized for the year ended November 30, 2007 from interest earned on
invested funds.  This is a reduction of $36,444 from the $58,131 earned
during the year ended November 30, 2006.  The decrease results from reduced
funds on deposit, as cash was used to fund operations and capital
expenditures.  The net loss for the year
ended November 30, 2007, was $968,454.  This compares to a net loss
realized for the year ended November 30, 2006, of $1,178,901.  It is
anticipated that the net loss in 2008 will increase as additional personnel and
resources are allocated to the testing, approval and commercialization of our
products.  Liquidity and Capital
Resources  To date, we have financed
our operations principally through private placements of equity securities.
 We used net cash for operating activities of $721,217 in the year ended
November 30, 2007.  As of November 30, 2007, our working capital was
$243,079, and our current liabilities were $40,898.  Our working capital
requirements for the foreseeable future will vary based on a number of factors,
including the costs to complete development work, the cost of bringing products
to commercial viability, the timing of the market launches, and the level of
sales.  As of November 30, 2007, we had accounts payable and accrued
liabilities totaling $40,898.  We need to raise additional funds
immediately in order to execute our business plan.  There can be no
assurance that additional funding will be available to us or that if funding is
available that it will be under favorable terms.  If we are unsuccessful in
raising additional funds we may be required to substantially reduce or eliminate
certain areas of our product development activities, limit our operations
significantly or cease operations entirely.     Item 7.  Financial Statements.      24      GeNOsys, Inc. (A Development Stage Company) Report of Independent Registered Public
Accounting Firm and Financial Statements  November 30, 2007  TABLE OF CONTENTS PageReport of Independent Registered Public Accounting
Firm
F-2Consolidated Balance Sheets as of November 30,
2007
F-3Consolidated Statements of Operations for the years
ended November 30, 2007 and 2006 and for the period of the development
stage (June 30, 2005) through November 30, 2007
F-4Consolidated Statements of Stockholders' Equity for
the years ended November 30, 2007 and 2006 and for the period of
development stage (June 30, 2005) through November 30, 2007
F-5 - F-6Consolidated Statements of Cash Flows for the years
ended November 30, 2007 and 2006 and for the period of the development
stage (June 30, 2005) through November 30, 2007
F-7Notes to Consolidated Financial Statements
F-8 - F-14       REPORT OF
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM   The Board of Directors and Shareholders GeNOsys, Inc. (A Development Stage Company)  We have audited the accompanying consolidated balance
sheets of GeNOsys, Inc. as of November 30, 2007 and 2006, and the related
consolidated statements of operations, stockholders equity, and cash flows for
the years ended November 30, 2007 and 2006 and for the period of the development
stage (June 30, 2005) through November 30, 2007.  These financial
statements are the responsibility of the Companys management.  Our
responsibility is to express an opinion on these financial statements based on
our audit.  We conducted our audit in accordance with the standards
of the Public Company Accounting Oversight Board (United States).  Those
standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement.  The Company has determined that it is not required to have,
nor were we engaged to perform, an audit of its internal control over financial
reporting.  Our audit included consideration of internal control over
financial reporting as a basis for designing audit procedures that are
appropriate in the circumstances, but not for expressing an opinion on the
effectiveness of the Companys internal controls over financial reporting.
 Accordingly, we express no such opinion.  An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements.  An audit also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation.  We believe that our audits provide a reasonable basis for
our opinion.  In our opinion, the financial statements referred to
above present fairly, in all material respects, the financial position of
 GeNOsys, Inc., (a development stage company), as of November 30, 2007 and
2006, and the results of their operations and their cash flows for the periods
ended November 30, 2007 and 2006 in conformity with accounting principles
generally accepted in the United States of America.  The accompanying financial statements have been prepared
assuming that the Company will continue as a going concern.  As discussed
in Note 2 to the financial statements, the Company has experienced recurring
losses from operations since its inception.  These factors raise
substantial doubt about its ability to continue as a going concern.  The
Company has not established operations with consistent revenue streams.
 Managements plans in regard to these matters are also described in Note
2.  The financial statements do not include any adjustments that might
result from the outcome of this uncertainty.   /s/Mantyla McReynolds, LLC  Mantyla McReynolds, LLC Salt Lake City, Utah February 22, 2008           F-2      GENOSYS,
INC. (A Development Stage Company) Consolidated Balance Sheets  ASSETSNovember 30, 2007

November 30, 2006CURRENT ASSETSCash and cash equivalents  Note
9
$    280,105

$  904,715Prepaid expenses
3,872

83,859Total Current Assets
283,977

988,574Property and equipment, net of
depreciation  Note 5
151,376

176,949Patents, net of amortization  Note
6
39,189

7,967TOTAL ASSETS
$  474,542

$  1,173,490LIABIITIES AND STOCKHOLDERS
EQUITYCURRENT LIABILITIESAccounts payable
$     13,151

$
     9,692Accounts payable, Related party  Note
10
13,340

-Accrued liabilities
14,307

49,840Taxes payable
100

100Total Current
Liabilities
40,898

59,632TOTAL LIABILITIES
40,898

59,632STOCKHOLDERS EQUITYCommon stock, $0.001 par value;
100,000,000
shares authorized; 45,881,600
and
45,668,031 shares issued and
outstand-
ing, respectively  Note 4
45,882

45,668Additional paid-in capital
2,813,440

2,525,414Accumulated deficit
(77,924)

(77,924)Deficit accumulated in the
development
Stage
(2,347,754)

(1,379,300)Total Stockholders
Equity
433,644

1,113,858TOTAL LIABILITIES AND STOCKHOLDERS EQUITY
$  474,542

$
  1,173,490  See Accompanying Notes to Financial
Statements.  F-3     GENOSYS,
INC. (A Development Stage Company) Consolidated Statements of
Operations From Inception ofthe Development StageFor the Years Ended

On June 30, 2005November 30,

Through2007

2006

November 30, 2007REVENUES
$
                  -

$
                      -

$
                                     -COST OF GOODS SOLD
-

-

-GROSS PROFIT
-

-

-OPERATING EXPENSESResearch and Development
489,326

730,131

1,219,457General and administrative
500,401

506,801

1,276,623Total Expenses
989,727

1,236,932

2,496,080LOSS FROM OPERATIONS
(989,727)

(1,236,932)

(2,496,080)OTHER INCOME (EXPENSE)Interest income
21,687

58,131

79,818Gain (Loss) on disposal of asset
(414)

-

(414)Other income (expense)
100

-

100LOSS FROM CONTINUING OPERATIONS
BEFORE INCOME TAXES
(968,354)

(1,178,801)

(2,416,576)PROVISION FOR INCOME TAXES
(100)

(100)

(300)LOSS FROM CONTINUING OPERATIONS
(968,454)

(1,178,901)

(2,416,876)DISCONTINUED OPERATIONSLoss from discontinued opera-
tions, net of tax
-

-

(2,131)Gain on disposal of discontin-
ued operations, net of
tax
-

-

71,253NET LOSS
$(968,454)

$  (1,178,901)

$
           (2,347,754)LOSS PER SHARE FROM CONTINUING
OPERATIONS
$     (0.02)

$     (0.03)

$
                (0.05)NET LOSS PER SHARE
$     (0.02)

$     (0.03)

$
                (0.05)WEIGHTED AVERAGE SHARES
OUTSTANDING  BASIC AND
       DILUTED
45,682,659

45,591,593

45,021,677 See Accompanying Notes to Financial
Statements.  F-4      GENOSYS, INC. (A Development Stage Company) CONSOLIDATED STATEMENTS OF STOCKHOLDERS
EQUITY From Inception of the Development Stage
(June 30, 2005) through November 30, 2007  AdditionalPaid-in

AccumulatedShares

Amount

Capital

Deficit

TotalBalance at June 30, 2005
2,556,500

2,557

26,243

(77,924)

(49,124)Issued common stock for cash at $0.0001
33,231,456

33,231

(29,908)

-

3,323Issued stock for patents at $0.0001
2,968,544

2,969

(2,672)

-

297Issued stock for consulting agreement at
$0.0001
3,800,000

3,800

(3,420)

-

380Shares canceled
(1,302,500)

(1,303)

1,303

-

-Issued stock for cash at $0.60 per share
3,964,031

3,964

2,374,418

-

2,378,382Stock promotion costs
-

-

(110,100)

-

(110,100)Net loss for the period ended November 30,
2005
-

-

-

(200,399)

(200,399)Balance at November 30, 2005
45,218,031

45,218

2,255,864

(278,323)

2,022,759  F-5      Issued stock for services at $0.60 per share
450,000

450

269,550

-

270,000Net loss for the period ended November 30, 2006
-

-

-

(1,178,901)

(1,178,901)Balance at November 30, 2006
45,668,031

45,668

2,525,414

(1,457,224)

1,113,858Issued stock for cash at $0.70 per share
213,569

214

149,286

-

149,500Non-cash compensation charges related to stock
option grants
-

-

138,740

-

138,740Net loss for the period ended November 30,
2007
-

-

-

(968,454)

(968,454)Balance at November 30, 2007
45,881,600

$
 45,882

$2,813,440

$ (2,425,678)

$  433,644                See Accompanying Notes to Financial
Statements   F-6     GENOSYS, INC. (A Development Stage Company) Consolidated Statements of Cash
Flow   From Inception of theFor the Year Ended

Development StateNovember 30,

On June 30, 20052007

2006

Through Nov. 30, 2007CASH FLOWS FROM OPERATING ACTIVITIESNet Loss
$(968,454)

$  (1,178,901)

$
      (2,347,754)Adjustments to reconcile net loss to net
cash used by operating
activities:Depreciation and
amortization
46,830

10,936

58,181Loss on disposal of equipment
414

-

414Stock-based compensation
138,740

-

138,740Gain on disposal
-

-

(71,253)Decrease in cash from
discontinued
Operations
-

-

(6,020)Stock issued for services
-

270,000

270,000Changes in operating assets and liabilities(Increase) Decrease in prepaid
expenses
79,987

(81,757)

(3,746)Increase (Decrease) in accounts
payable
16,799

3,631

26,490Increase (Decrease) in accrued
compensation
(35,533)

47,240

14,207Increase (Decrease) in tax
payable
-

100

200Net Cash Used by Operating
Activities
(721,217)

(928,751)

(1,920,541)CASH FLOWS FROM INVESTING ACTIVITIESPurchase of intangible assets
(34,459)

(7,670)

(42,129)Purchase of equipment
(18,434)

(167,409)

(206,480)Net Cash Used by Investing
Activities
(52,893)

(175,079)

(248,609)CASH FLOWS FROM FINANCING ACTIVITIESIssuance of common stock for
cash
149,500

-

2,421,104Cash from discontinued
operations
-

-

(19,777)Net Cash Provided by
Financing Activities
149,500

-

2,401,327NET INCREASE (DECREASE) IN CASH
(624,610)

(1,103,830)

232,177CASH AT BEGINNING OF PERIOD
904,715

2,008,545

47,928CASH AT END OF PERIOD
$    280,105

$  904,715

$
          280,105SUPPLEMENTAL DISCLOSURES INFORMATIONCash paid during the year for
interest
-

-

$
              750Cash paid during the year for
income/
Franchise taxes
$
             100

$
              100

$
              200 See Accompanying Notes to Financial
Statements.  F-7     NOTE 1  ORGANIZATION
AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES  Organization  GeNOsys, Inc. (Company) was founded June 30, 2005.
 On August 19, 2005, the Company merged with The Autoline Group, Inc., a
Utah corporation, which operated as an automotive dealership until September 12,
2005, when the dealership was discontinued.  The Company was organized to
engage in the business of producing a portable medical gas generator.  The
Company was incorporated under the laws of the State of Nevada.  The Company is considered to be in the development stage
as defined in Financial Accounting Standards Board Statement No. 7.  It has
yet to commence full-scale operations and it continues to develop its planned
principle operations.  The financial statements of the Company have been
prepared in accordance with accounting principles generally accepted in the
United States of America.  The consolidated financial statements of the
Company include the accounts of GeNOsys, Inc. and its subsidiary, GeNOsys, Inc.,
a Nevada corporation.  All significant intercompany transactions have been
eliminated.  The following summarizes the more significant of such
policies:  Income Taxes  The Company applies the provisions of Statement of
Financial Accounting Standards No. 109 (the Statement), Accounting for Income
Taxes.  The Statement requires an asset and liability approach for
financial accounting and reporting for income taxes, and the recognition of
deferred tax assets and liabilities for the temporary differences between the
financial reporting basis and tax basis of the Companys assets and liabilities
at enacted tax rates expected to be in effect when such amounts are realized or
settled.  See Note 3.  Net Loss Per Common Share  In accordance with Statement of Financial Accounting
Standards (SFAS) No. 128, Earnings per Share, basic loss per common share is
based on the weighted-average number of shares outstanding.  Diluted income
or loss per share is computed using weighted average number of common shares
plus dilutive common share equivalents outstanding during the period using the
treasury stock method.  The Company had 170,000 vested options exercisable
at November 30, 2007 but due to the net loss were not included in the net loss
per common share as their inclusion would be antidilutive.  Revenue Recognition  The Company recognizes revenue in accordance with the
Securities and Exchange Commission Staff Accounting Bulletin (SAB) Number 104,
which states that revenue is generally recognized when it is realized and
earned.  Specifically, the Company recognizes revenue when products are
completed and accepted by the customer.  Research and Development Costs  Research and development costs are expensed in the period
they are incurred in accordance with Financial Accounting Standard No. 2,
Accounting for Research & Development Costs.  Capitalization of Patent Costs  The Company has elected to capitalize patent costs and
will amortize them over the shorter of the life of the patent or the number of
years from which it is estimated that economic benefit will be derived.   F-8     Statement of Cash
Flows  For purposes of the statements of cash flows, the Company
considers cash on deposit in the bank to be cash.  The Company had $280,105
in cash on November 30, 2007.  Use of Estimates in Preparation of Financial
Statements  The preparation of financial statements in conformity
with U. S. 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.  Fair Value of Financial Instruments  All cash and cash equivalents, accounts payable, and
accrued liabilities are carried at approximate market value.  Recent Accounting Pronouncements  In February 2007, the FASB issued SFAS No. 159, The Fair
Value Option for Financial Assets and Financial Liabilities Including an
Amendment of SFAS No. 115, Accounting for Certain Investments in Debt and
Equity Securities.  SFAS 159 allows entities to choose, at specified
election dates, to measure eligible financial assets and liabilities at fair
market value in situations in which they are not otherwise required to be
measured at fair value.  If a company elects the fair value option for an
eligible item, changes in that items fair value in subsequent reporting periods
must be recognized in current period earnings.  SFAS No. 159 also
establishes presentation and disclosure requirements designed to draw comparison
between entities that elect different measurement attributes for similar assets
and liabilities.  SFAS No. 159 is effective for fiscal years beginning
after November 15, 2007.  The Company is evaluating the impact of the
adoption of SFAS No. 159 on our consolidated financial statements.  In December 2007, the FASB issued SFAS No. 141 (revised
2007), Business Combinations (SFAS No. 141R).  SFAS No. 141R expands
the definition of a business combination and requires the fair value of the
purchase price of an acquisition, including the issuance of equity securities,
to be determined on the acquisition date.  SFAS No. 141R also requires that
all assets, liabilities, contingent considerations, and contingencies of an
acquired business be recorded at fair value at the acquisition date.  In
addition, SFAS No. 141R requires that acquisition costs generally be expensed as
incurred, restructuring costs generally be expensed in periods subsequent to the
acquisition date and changes in accounting for deferred tax asset valuation
allowances and acquired income tax uncertainties after the measurement period
impact income tax expense.  SFAS No. 141R is effective for our fiscal years
beginning on or after December 15, 2008, with early adoption prohibited.
 The Company is evaluating the effect the implementation of SFAS No. 141R
will have on its consolidated financial statements.  In December 2007, the FASB issued SFAS No. 160,
Noncontrolling Interests in Consolidated Financial Statements, an Amendment of
ARB No.51 (SFAS No. 160).  SFAS No. 160 requires minority interests to
be recharacterized as noncontrolling interests and reported as a component of
equity.  In addition, SFAS No. 160 requires that purchases or sales of
equity interests that do not result in a change in control be accounted for as
equity transactions and, upon a loss of control, requires the interests sold, as
well as any interests retained, to be recorded at fair value with any gain or
loss recognized in earnings.  SFAS No. 160 is effective for fiscal years
beginning on or after December 15, 2008, with early adoption prohibited.
 No material impact on the financial statements of the Company is expected
from the adoption of this standard.  The Company has reviewed all other recently issued, but
not yet adopted, accounting standards in order to determine their effects, if
any, on its consolidated results of operation, financial position or cash flows.
 Based on that review, it believes that none of these pronouncements will
have a significant effect on our current or future earnings or operations.   F-9     NOTE 2   GOING
CONCERN  The Company has accumulated losses since inception and
has not yet been able to generate profits from operations.  Operating
capital has been raised through the sale of common stock or through loans from
shareholders.  These factors raise substantial doubt about the Companys
ability to continue as a going concern.  Management plans include further development and
production of portable medical gas generators.  Management is seeking
additional funding through the capital markets.  The financial statements
do not include any adjustments that might result from the outcome of this
uncertainty.  NOTE 3   INCOME TAXES  The provision for income taxes consists of the
following:  2007

2006Current Taxes
$
100
$
100$
100
$
100  The Company has available net operating losses of
approximately $2,275,864 which can be utilized to offset future earnings of the
Company. Below is a summary of deferred tax asset calculations on the net
operating loss carryforward amount.  The net loss carryforward amounts
expire between 2025 and 2027.  A valuation allowance is provided when it is
more likely than not that some portion of the deferred tax asset will not be
realized.  The Company has the following carryforwards available at
November 30, 2007:  TaxableTemporary
Expected
Deferred TaxDifference
Tax Rate
Asset (Liability)Non-current deferred tax assetBook/Tax depreciation differenceFederal
$
             1,253
15%
$
             188State
1,253
5%
63Book/Tax amortization difference (patent)Federal
$
             3,237
15%
486State
3,237
5%
162Net operating lossesFederal
2,275,864
15%
341,380State
2,275,864
5%
113,793Stock CompensationFederal
138,740
15%
20,811State
138,740
5%
6,937Other carryforwardsFederal
414
15%
62State
414
5%
21Preliminary deferred tax asset


483,903Deferred tax asset valuation allowance


(483,903)Total deferred tax asset (liability)


-   The Company is incorporated in and conducts its
operations in the State of Utah, which levies a $100 minimum  F-10     Franchise tax per year.
 As a result, the Company has accrued a provision of $100 per year to
account for this tax. The effective tax rate for continuing operations differs
from the statutory rate as follows:  Expected provision (taxes on income before
taxes)
$
         (193,670)Effect of:Non-deductible expenses
2,826Temporary differences due to depreciation
(251)Deduction for state taxes
(20)Increase (decrease) in valuation allowance
191,115State minimum franchise tax
100Total actual provision
$
                   100  NOTE 4   COMMON STOCK  On June 30, 2005, the Company issued 33,231,456 shares of
common stock for cash, at $0.0001 per share to the officers of the Company. In
addition, the Company issued 2,968,544 shares of common stock at $0.0001 per
share in exchange for patents and 3,800,000 shares of common stock at $0.0001
per share as part of a consulting agreement, of which, 1,302,500 were
subsequently canceled. In October and November of 2005, the Company issued
3,964,031 shares of common stock for cash, at $0.60 per share to private
investors and incurred stock promotion expenses of $110,100 as part of the
issuance.  On January 31, 2006, the Board of Directors consented to
the issuance of 450,000 shares of restricted common stock in exchange for
services provided to the Company.  The transaction was valued at $270,000
($0.60 per share).  On or about November 30, 2007, we completed the private
sale of 213,569 shares of our common stock at a price of $0.70 per share for
aggregate gross proceeds of $149,500.  NOTE 5   PROPERTY, PLANT &
EQUIPMENT  The major classes of assets as of the balance sheet dates
are as follows:   2007

2006Furniture and
fixtures
$
      64,289

$
      64,289Office
equipment
35,469

30,027Lab
equipment
85,752

85,546Leasehold
improvements
20,323

8,184205,833

188,046Accumulated
depreciation
(54,457)

(11,097)$
     151,376

$
        176,949  Equipment is stated at cost.  Depreciation is
provided by using the straight-line method of depreciation over five years.
 Depreciation expense for the years ended November 30, 2007 and 2006 was
$43,593 and $10,936, respectively.  Amortization expense related to
leasehold improvements for the years ended November 30, 2007 and 2006 was $3,211
and $136, respectively.  Expenditures for maintenance and repairs are
charged to expense as incurred.    F-11     NOTE 6
  PATENTS  The Company issued 200,000 shares of common stock at
$0.0001 per share for Technology Rights and 2,768,544 shares of common stock at
$0.0001 per share for additional rights. (See Note 4.)  The Company also
capitalized $34,459 in patent costs during the current year.  As of
November 30, 2007 the patents were valued at $42,426.  Amortization expense
related to patents for the years ended November 30, 2007 and 2006 was $3,237 and
$0, respectively.  NOTE 7   COMMITMENTS AND
CONTINGENCIES  The Company leases office space under a five-year
noncancelable operating lease that commenced on November 1, 2006.  The
following summarizes future minimum lease payments under the operating lease at
November 30, 2007:  Year
Ending
                           Minimum November
30,                      Lease
Payments 2008
                                 $
59,779 2009
                                    61,273 2010
                                    62,805 2011
                               58,888 $
242,745  The Company also continues to lease its previous office
space on a month-to-month basis at a rate of $1,600 per month.  The
facility is used for research and development purposes.  Total rent expense for the year ended November 30, 2007
and 2006 was $77,521 and $25,854, respectively.  NOTE 8   DISCONTINUED OPERATIONS  On September 12, 2005 the Company discontinued its
automotive dealership operation by divesting the ownership of The Autoline Group
2, Inc., a wholly owned subsidiary, to a former officer in exchange for an
indemnification agreement.  NOTE 9   CONCENTRATION  The Company maintains cash balances at a financial
institution located in the Ogden, UT area.  Accounts at this institution are insured by the Federal Deposit Insurance
Corporation up to $100,000.  The Company had cash of $280,105, as of November 30, 2007 in this financial
institution, which is in excess of the FDIC insured limits by $180,105.  NOTE 10   RELATED PARTIES  As of November 30, 2007, a director and officer of the
Company owned 54.7% of the Companys issued and outstanding stock.  This
allows for the officer to effectively control the vote on substantially all
significant matters without the approval of the other stockholders.  As of November 30, 2007, officers of the Company were
owed $13,340 for various expenditures they made on behalf of the Company.  NOTE 11   STOCK-BASED COMPENSATION  In December 2004, the Financial Accounting Standard Board
(FASB) issued SFAS 123R, Share-Based Payments (SFAS No. 123R), a revision
of SFAS No. 123 Accounting for Stock-Based Compensation (SFAS No. 123),
which requires companies to measure all employee stock-based compensation awards
using a fair value  F-12     method and record such expense
in their financial statements.  The Company adopted this standard effective
December 1, 2006, and elected the modified-prospective transition method.
 Under the modified-prospective transition method, awards that are granted,
modified, repurchased or canceled after the date of adoption should be measured
and accounted for in accordance with SFAS No. 123R.  The Company had no
options outstanding prior to the issuance of SFAS No. 123R.  On March 23, 2007, the GeNOsys, Inc. 2007 Stock Option
Plan (Stock Plan) was approved by the Board of Directors and became effective
on that date, subject to the Stock Plan being approved by the stockholders at
the annual meeting.  The Stock Plan provides that 3,000,000 shares of the
Companys authorized but unissued common stock be reserved pursuant to the terms
and conditions of the plan.  On June 27, 2007, the annual meeting of
stockholders was held, at which time the stockholders approved the Stock Plan.
 The Stock Plan allows the Company, under the direction of the Compensation
Committee, to make broad-based grants of stock options, any of which may or may
not require the satisfaction of performance objectives, to employees,
consultants and non-employee directors.   In June and July 2007, the
Board of Directors approved stock option grants to purchase 1,100,000 shares of
common stock to certain employees, directors and consultants, resulting in a
non-cash charge of $574,321.  In November 2007, the Board of Directors
approved an addition grant of 100,000 options to an employee resulting in a
non-cash charge of $57,737. The charge is being expensed ratably over the
shorter of the vesting period or the requisite service period of the stock
option grants.  A summary of the status of the
Companys option plans as of December 1, 2006, and changes during the year ended
November 30, 2007, is presented below:  Shares
Wtd. Avg.Exercise Prices
Wtd.
Avg.RemainingContractualLife

Aggregate Intrinsic ValueOutstanding
at beginning of year
-
$
         -Granted
1,200,000
.66
9.68 yearsForfeited
-
-Outstanding
at November 30, 2007
1,200,000
.66
9.68 years
$43,000Exercisable
at November 30, 2007
170,000
.66
9.68 years
$5,550Non-vested
at November 30,
2007
1,030,000
.66
9.68 years
$37,450  The following
table summarizes information about stock options outstanding at November 30,
2007: Options Outstanding
Options ExercisableRange ofExercise
Prices
NumberOutstandingas of Nov.
30, 2007
Wtd.
Avg.RemainingContractualLife
Wtd.
Avg.ExercisePrice
NumberExercisableas of Nov.
30, 2007
Wtd.
Avg.ExercisePrice$
.66
1,100,000
9.62
years
$
        .66
145,000
$
       .66.71
100,000
9.98
years
.71
25,000
.711,200,000

.66
170,000
.67     F-13     The
fair value of each option granted is estimated on the date of grant using the
Black-Scholes option pricing model.   The use of this valuation model
requires the use of accounting judgment and financial estimates, including
estimates of the expected term employees will retain their vested warrants
before exercising them, the estimated volatility of our stock price, and the
number of warrants that will be forfeited prior to the completion of their
vesting requirements.  Application of alternative assumptions could produce
significantly different estimates of the fair value of stock-based compensation
and consequently, the related amounts recognized in our statements of
operations.  The following weighted-average assumptions used for grants in
2007: average risk-free interest rate of 5.25%; expected lives of 10 years;
expected dividend yield of zero percent; expected volatility of 61.47% to
68.88%.  For the year ended November 30, 2007 and 2006, the Company
recognized stock based compensation expense of $138,740 and $0, respectively.
 As of November 30, 2007, total stock based compensation related to
nonvested awards not yet recognized was $493,318 with a weighted average
recognition period of 9.62 years.  The weighted-weighted average
grant-date fair value of options granted during the year ended November 30,
2007, was $0.52.  NOTE 12 SUBSEQUENT EVENTS  Subsequent to November 30, 2007, the
Company issued 17,142 shares of common stock for cash proceeds of $12,000.            F-14       Item 8.  Changes in and Disagreements with
Accountants on Accounting and Financial Disclosure.  None; not applicable.    Item 8(a)T. Controls and Procedures  As of the end of the period covered by this
Annual Report, we carried out an evaluation, under the supervision and with the
participation of our Chief Executive Officer and Chief Financial Officer, of the
effectiveness of our disclosure controls and procedures. Based on this
evaluation, our Chief Executive Officer and Chief Financial Officer concluded
that information required to be disclosed is recorded, processed, summarized and
reported within the specified periods and is accumulated and communicated to
management, including our President and Secretary, to allow for timely decisions
regarding required disclosure of material information required to be included in
our periodic Securities and Exchange Commission reports. Our disclosure controls
and procedures are designed to provide reasonable assurance of achieving their
objectives and our Chief Executive Officer and Chief Financial Officer have
concluded that our disclosure controls and procedures are effective to a
reasonable assurance level of achieving such objectives. However, it should be
noted that the design of any system of controls is based in part upon certain
assumptions about the likelihood of future events, and there can be no assurance
that any design will succeed in achieving its stated goals under all potential
future conditions, regardless of how remote. In addition, we reviewed our
internal controls, and there have been no significant changes in our internal
controls or in other factors in the last fiscal quarter that has materially
affected or is reasonably likely to materially affect our internal control over
financial reporting.  Evaluation of Disclosure Controls and
Procedures.Our
management, with the participation of our Chief Executive Officer and Chief
Financial Officer, evaluated the effectiveness of our disclosure controls and
procedures as of the end of the period covered by this report. Based on that
evaluation, our Chief Executive Officer and Chief Financial Officer concluded
that our disclosure controls and procedures as of the end of the period covered
by this report were effective such that the information required to be disclosed
by us in reports filed under the Exchange Act is (i) recorded, processed,
summarized and reported within the time periods specified in the Securities and
Exchange Commissions rules and forms and (ii) accumulated and communicated
to our management, including our Chief Executive Officer and Chief Financial
Officer, as appropriate to allow timely decisions regarding disclosure. A
controls system cannot provide absolute assurance, however, that the objectives
of the controls system are met, and no evaluation of controls can provide
absolute assurance that all control issues and instances of fraud, if any,
within a company have been detected.  Managements Annual Report on Internal
Control over Financial Reporting.Our management is responsible for
establishing and maintaining adequate internal control over financial reporting
(as defined in Rule 13a-15(f) under the Exchange Act). Our internal control
over financial reporting is a process designed to provide reasonable assurance
regarding the reliability of financial reporting and the preparation of
financial statements for external purposes of accounting principles generally
accepted in the United States.  Because of its inherent limitations, internal
control over financial reporting may not prevent or detect misstatements.
Therefore, even those systems determined to be effective can provide only
reasonable assurance of achieving their control objectives.  Our
management, with the participation of our Chief Executive Officer and Chief
Financial Officer, evaluated the effectiveness of our internal control over
financial reporting as of December 31, 2007.  In making this
assessment, our management used the criteria set forth by the Committee of
Sponsoring Organizations of the Treadway Commission (COSO) in Internal
Control - Integrated Framework.  Based on this evaluation, our
management, with the participation of the President and Secretary/Treasurer,
concluded that, as of November 30, 2007, our internal control over financial
reporting was effective.  Changes in internal control over
financial reporting  There have been no changes in internal
control over financial reporting.   25        Item 8(b).  Other.  None; not applicable.     [REMAINDER OF PAGE INTENTIONALLY LEFT
BLANK]  26     PART III     Item 9.  Directors, Executive Officers, Promoters
and Control Persons; Compliance with Section 16(a) of the Exchange Act.  Identification of
Directors and Executive Officers  The following table sets
forth the names of all of our current directors and executive officers.
 These persons will serve until the next annual meeting of the stockholders
or until their successors are elected or appointed and qualified, or their prior
resignation or termination.  Name
Positions Held
Date of Election or
Designation
Date of Termination or
ResignationJohn W. R. Miller
Chief Executive Officer
and Director
8/18/2005
*Brett A. Blake
President
7/31/2007
*Keith L. Merrell
Chief Financial Officer
3/23/2007
*and TreasurerClark M. Mower
Director
Chairman of the Board
8/18/2005
3/23/2007
*
*Christie M. Jones
Secretary
8/18/2005
*John P. Livingstone
Director
3/23/2007
*  *
These persons presently serve in the capacities indicated.  Business
Experience  John W. R. Miller.
 Mr. Miller is our founder, serves as our Chief Executive Officer, and is
56 years old.  In 2003, he co-founded Alberta 1017975 with Christie W.
Jones, the predecessor to our Technology Rights.  From 2001 to 2003, Mr.
Miller was self-employed.  Mr. Miller was the President and a Co-Founder of
Pulmonox Medical Corp., a biotechnology corporation, where he worked from 1990
to 2001. He participated in the FDA approval process for inhaled nitric oxide
therapy. Mr. Miller sold his interest in Pulmonox in 2001.  Mr. Miller
received a B.S. Degree in Education/Business from Brigham Young University in
1972.  Brett A. Blake.
 Mr. Blake is our President  and is 40 years old.  He joined our
Company in July, 2007.  Mr. Blake is a PepsiCo-trained senior executive
with fifteen years experience in strategic marketing and an expert in leading
strong sales initiatives.  He served three years as Managing Partner of
Blake Capital, LLC, a regional investment firm.  From 1999 to 2004 Mr.
Blake served as Vice President of Marketing for USANA Health Sciences, Inc.,
directing their global marketing activities and strategic planning.
 Previous to that, he spent two years with Frito-Lay, Inc., a subsidiary of
Pepsi-Co, developing and managing marketing activities, new product launches and
promotions.  Mr. Blake received a B.A. degree in Communications from
Brigham Young University and an M.B.A. from Harvard University.  Keith L. Merrell.
 Mr. Merrell is our Chief Financial Officer, Treasurer and General Manager;
he is 62 years old.  He joined our Company in February 2007.  Mr.
Merrell draws on 28 years of accounting experience to manage all of our
accounting functions and to interface with our independent public accountants.
 He spent two years in the field of public accounting, and served as Chief
Financial Officer or Controller of five companies prior to his joining us.
 His business career also includes extensive experience in management,
sales and marketing, and consulting.  He served as both Chief Financial
Officer and Controller of Specialized Health Products International, Inc., a  27     manufacturer of safety medical
devices, from 2000 to 2007, and as Vice President-Western Operations for
Michelex, an injection molding company with corporate headquarters in New York,
from 1998 to 2000.  From 1991 to 1998 he served as Director of Finance for
The Duplication Group, planning, implementing, and bringing online the first
compact disc manufacturing facility in the intermountain area.  He
graduated from Arizona State University with a B.S. degree in Accounting.  Clark M. Mower.  Mr. Mower is one of our directors, and he is 61 years old.
 From January 2005 to the present, Mr. Mower has been the President/CEO and
a director of Flexpoint Sensor Systems, Inc., a producer of sensors for
automotive and industrial uses.  His responsibilities include all areas of
management, including staffing and financial responsibilities of a growing
sensor company.  From August 2002 to the present, Mr. Mower has also served
as a co-founder and managing member of Polar Energy, LLC, of Mountain Green,
Utah, and Littleton, Colorado, which provides consulting services to companies
that are considering divestiture, mergers or acquisitions.  From January
2000 to August 2002, Mr. Mower was Senior Vice President, Mergers and
Acquisitions, Merchant Energy Group, with El Paso Energy in Golden, Colorado,
where he worked on or lead teams that successfully closed power related
acquisitions and divestitures.  Christie M. Jones.
 Ms. Jones is 25 years old.  Ms. Jones co-founded Alberta 1017975.
 In the fall of 2003, she became President of GeNOsys Canada, a
biotechnology corporation.  Ms. Jones has been Executive Assistant to John
W.R. Miller since 1999.  Her responsibilities included: tracking nitric
oxide research projects, supervising manufacturing contractors, payroll,
scheduling, and supervision of personnel.  Ms. Jones studied mathematics at
Grant MacEwan Community College in Edmonton, Alberta, Canada.  John P. Livingstone.
 Dr. Livingstone, a Ph.D. is a director of our Company and is 56 years old.
 In addition to his practice as a psychologist, Dr. Livingstone has served
as an educator, both in Canada and the United States, and is currently a
professor at Brigham young University.  Dr. Livingstone has published and
been a contributor to a number of books, as well as writing and/or presenting
numerous articles and papers.  His work has earned him recognition among
his peers for his distinguished service.  Dr. Livingstone received a B.S.
degree in Biology/Chemistry from the University of Alberta in 1974, a Master of
Education degree in Guidance and Counseling from the University of Regina in
1981, and a Doctor of Education degree in Counseling and Personnel Services from
Brigham Young University in 1986.  Significant
Employees  There are no employees who
are not executive officers who are expected to make a significant contribution
to our Companys business.  Family
Relationships  There are no family
relationships between any director or executive officer.  Involvement in Certain
Legal Proceedings  During the past five years,
no present or former director, executive officer or person nominated to become a
director or an executive officer of our Company:  (1)
was a general partner or executive officer of any business against which any
bankruptcy petition was filed, either at the time of the bankruptcy or two years
prior to that time;  (2)
was convicted in a criminal proceeding or named subject to a pending criminal
proceeding (excluding traffic violations and other minor offenses);  (3)
was subject to any order, judgment or decree, not subsequently reversed,
suspended or vacated, of any court of competent jurisdiction, permanently or
temporarily enjoining, barring, suspending or otherwise limiting his  28     involvement in any type of
business, securities or banking activities; or  (4)
was found by a court of competent jurisdiction (in a civil action), the
Commission or the Commodity Futures Trading Commission to have violated a
federal or state securities or commodities law, and the judgment has not been
reversed, suspended or vacated.  Compliance with Section
16(a) of the Exchange Act  Our executive officers,
directors, and 10% stockholders are required under the Securities Exchange Act
of 1934 to file reports of ownership and changes in ownership with the
Securities and Exchange Commission.  Copies of these reports must also be
furnished to us.  Based solely on a review of
the copies of reports furnished to us, or written representations that no
reports were required, we believe that during the fiscal year ended November 30,
2007, our executive officers, directors and 10% stockholders complied with all
filing requirements.  Code of Ethics  We adopted a Code of Ethics
for our Chief Executive Officer or our Chief Financial Officer and attached a
copy of our Code of Ethics as an exhibit to our Form 10-KSB for the year ended
November 30, 2005.  See Part III, Item 13.  A copy of our Code of
Ethics will be provided, free of charge, upon request to us at the address and
telephone number listed on the cover page of this Annual Report.  Corporate
Governance  Director
Independence  Only one of our directors,
John P. Livingstone, presently qualifies as an independent director.  None
of our other directors presently qualify as independent directors due to the
percentage of ownership and/or affiliation with us as an employee or
consultant.  Board Meetings and
Committees; Annual Meeting Attendance  During the year ended
November 30, 2007, four Board meetings were held.  Our annual meeting was
held June 27, 2007.  Nominating Committee
Corporate Governance Committee  We have not established a
nominating and corporate governance committee because, due to our lack of
substantial operations and the fact that we only have three directors and
executive officers, we believe that we are able to effectively manage the issues
normally considered by a nominating and corporate governance committee.
 Following an increase in our current operations, a further review of this
issue will no doubt be necessitated and undertaken by our management.  Audit Committee  Our Board of Directors
currently serves as our Audit Committee.  We have not yet established an
independent audit committee; we do not believe the lack of an independent audit
committee will have any adverse effect on our financial statements, based upon
our current business operations.  We will continue to assess the point at
which an independent audit committee will be necessary in the future.   29     Compensation
Committee  We have not established a
compensation committee because, due to our lack of substantial operations and
the fact that we only have three directors and executive officers; we believe
that we are able to effectively manage the issues normally considered by a
compensation committee.  Following an increase in our current operations, a
further review of this issue will no doubt be necessitated and undertaken by our
management.  Shareholder
Communications  Although we do not have a
formal policy regarding communications with the Board of Directors, stockholders
may communicate with our Board of Directors by writing to us at:  GeNOsys,
Inc., Attention: Investor Relations, 280 West Riverpark Dr., Suite 300, Provo, UT
84604.  Stockholders who would like their submission directed to a
particular member of the Board may so specify, and the communications will be
forwarded to that director, as appropriate.     Item 10. Executive Compensation.  Information required by
this item is incorporated by reference to information to be contained under the
captions Executive Officer Compensation and Corporate Governance  Director
Compensation in our 2008 proxy statement to be filed with the Securities and
Exchange Commission.  Stock Option
Plans  On March 23, 2007,
the GeNOsys, Inc. 2007 Stock Option Plan (Stock Option Plan) was approved by
the Board of Directors and became effective on that date, subject to the Stock
Option Plan being approved by the stockholders at the annual meeting.  The
Stock Plan provides that 3,000,000 shares of our authorized but unissued common
stock be reserved pursuant to the terms and conditions of the plan.  The
Stock Plan was approved by a vote of stockholders at the Annual Meeting held
June 27, 2007.  The Stock Plan allows the Board of Directors, under the
direction of the Compensation Committee, to make broad-based grants of stock
options, any of which may or may not require the satisfaction of performance
objectives, to employees, consultants and non-employee directors.
 Subsequent to the approval of the Stock Option Plan by stockholders, the
Board of Directors has approved stock option grants to purchase 1,200,000 shares
of common stock to certain employees, directors and consultants.  The
non-cash charges for such grants, valued at the date of grant using the
Black-Scholes valuation model, are expensed ratable over the shorter of the
vesting period or the requisite service period of the stock option grants.  A summary of the
status of our option plans as of December 1, 2006, and changes during the year
ended November 30, 2007, is presented below:  Shares
Wtd. Avg.Exercise Prices
Wtd.
Avg.RemainingContractualLife

Aggregate Intrinsic ValueOutstanding
at beginning of year
-
$
            -Granted
1,200,000
.66
9.68 yearsForfeited
-
-Outstanding
at November 30, 2007
1,200,000
.66
9.68 years
.09Exercisable
at November 30, 2007
170,000
.66
9.68
years
.09Non-vested
at November 30, 2007
1,030,000
.66
9.68
years
.09   30      The following
table summarizes information about stock options outstanding at November 30,
2007: Options Outstanding
Options ExercisableRange ofExercise
Prices
NumberOutstandingas of Nov.
30, 2007
Wtd.
Avg.RemainingContractualLife
Wtd.
Avg.ExercisePrice
NumberExercisableas of Nov.
30, 2007
Wtd.
Avg.ExercisePrice$
.66
1,100,000
9.62
years
$
       .66
145,000
$
       .66.71
100,000
9.98
years
.71
25,000
.711,200,000

.66
170,000
.67    The
fair value of each option granted is estimated on the date of grant using the
Black-Scholes option pricing model.   The use of this valuation model
requires the use of accounting judgment and financial estimates, including
estimates of the expected term employees will retain their vested warrants
before exercising them, the estimated volatility of our stock price, and the
number of warrants that will be forfeited prior to the completion of their
vesting requirements.  Application of alternative assumptions could produce
significantly different estimates of the fair value of stock-based compensation
and consequently, the related amounts recognized in our statements of
operations.  The following weighted-average assumptions used for grants in
2007: average risk-free interest rate of 5.25%; expected lives of 10 years;
expected dividend yield of zero percent; and expected volatility of 68.88%.
 For the years ended November 30, 2007 and 2006, we recognized stock based
compensation expense of $136,783 and $0, respectively.  As of November 30,
2007, total stock based compensation related to non-vested awards not yet
recognized was $487,446 with a weighted average recognition period of 9.68
years.  The
weighted-weighted average grant-date fair value of options granted during the
year ended November 30, 2007, was $0.52.  Compensation of
Directors  Our outside directors are
paid $2,500 monthly for their service.  The Chairman receives an additional
$500 per month for serving as Board Chairman.  No additional amounts are
payable to our directors for committee participation or special assignments.  Termination of
Employment and Change of Control Agreement  There are no employment
contracts, compensatory plans or arrangements, including payments to be received
from us with respect to any director or executive officer of ours which would in
any way result in payments to any such person because of his or her resignation,
retirement or other termination of employment with us, any change in control of
our Company, or a change in the persons responsibilities following a change in
control of our Company.     Item 11. Security Ownership of Certain Beneficial
Owners and Management.  Information required by
this item is incorporated by reference to information to be contained under the
caption Security Ownership of Management and Certain Beneficial Owners in our
2008 proxy statement to be filed with the Securities and Exchange
Commission.     Item 12. Certain Relationships and Related
Transactions.  There have been no material
transactions involving $60,000 or more between us or our subsidiaries and/or our
directors, executive officers or five percent stockholders other than
compensatory arrangements that will be detailed in our 2008 proxy statement to
be filed with the Securities and Exchange Commission.      31     Item 13. Exhibits and
Reports on Form 8-K.  Exhibits.  Listed on page 33
hereof.     Item 14. Principal Accountant Fees and
Services.  Information required by
this item is incorporated by reference to information to be contained under the
caption Principal Accounting Fees and Services in our 2008 proxy statement to
be filed with the Securities and Exchange Commission.      SIGNATURES  Pursuant to the
requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the
Registrant has duly caused this Annual Report to be signed on its behalf by the
undersigned, thereunto duly authorized.  GeNOsys,
Inc.  Date: 2/28/2008
                 By/s/John
W. R. Miller John
W. R. Miller, Jr., Director and
Chief Executive Officer  Date: 2/28/2008
                 By/s/Brett
A. Blake Brett
A. Blake President  Date: 2/28/2008
                 By/s/Keith
L. Merrell Keith
L. Merrell Chief
Financial Officer and Treasurer  Date: 2/28/2008
                 By/s/Clark
M. Mower Clark
M. Mower, Director and Chairman
of the Board  Date: 2/28/2008
                 By/s/John
P. Livingstone John
P. Livingstone Director   32     EXHIBIT INDEX   Exhibit No.
             Description
of Exhibit   3.1 Articles of Incorporation
(Incorporated by reference to our Registration Statement on Form 10-SB filed May
14, 2002).  3.2 By-laws (Incorporated by reference to
our Registration Statement on Form 10-SB filed May 14, 2002).  3.3 Amendment to the Articles of
Incorporation dated September 12, 2005 (Incorporated by reference to Exhibit 3.3
of our Form 10-KSB, dated November 30, 2005).  3.4 Amendment to the By-Laws dated June
18th, 2004 (Incorporated by reference to Exhibit 3.4 of our Form 10-KSB, dated
November 30, 2005).  14 Code of Ethics (Incorporated by
reference to Exhibit 14 of our Form 10-KSB, dated November 30, 2005).  21 Subsidiaries (Incorporated by
reference to Exhibit 21 of our Form 10-KSB, dated November 30, 2005).  Registration statement on Form 10-SB
filed May 14, 2002, as amended on September 10, 2002, November 19, 2002 and
December 9, 2002*  Annual Report on Form 10KSB for the
year ended November 30, 2005 and filed on March 7, 2006*  Annual Report on Form 10KSB for the
year ended November 30, 2006 and filed on March 15, 2007*  Current Report on Form 8-K dated
January 22, 2008 and filed February 12, 2008*  *   Incorporated herein by
reference.  31.1 Certification of John W. R. Miller
under Section 302 of the Sarbanes-Oxley Act of 2002.  31.2 Certification of Christie Melanie
Woodruff Jones under Section 302 of the Sarbanes-Oxley Act of 2002.  32 Certification of John W.R. Miller and
Christie Melanie Woodruff Jones pursuant to 18 U.S.C. Section 1350, as Adopted
pursuant to Section 906 of the Sarbanes-Oxley Act Of 2002   33