FORM 10-QSB

 

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

Quarterly Report Under Section 13 or 15 (d)

of the Securities Exchange Act of 1934

 

For the Quarter Ended December 31, 2007     Commission File No. 000-52771

 

PURAMED BIOSCIENCE, INC.

(Exact name of registrant as specified in its charter)

 

      Minnesota                  20-5510104

|   | (State or other jurisdiction of | (I.R.S. Employer |
|--------|---------------------------------|------------------|

|   | incorporation or organization) | Identification No.) |
|--------|--------------------------------|---------------------|

 

1326 Schofield Avenue

Schofield, WI  54476

(Address of principal executive offices)

 

(715) 359-6373

 (Issuer’s telephone number)

 

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

 

YES   X            NO______

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of accelerated filer and large accelerated filer in Rule12b-2 of the Exchange Act. (Check one):

 

| Large accelerated filer ___ | Accelerated filer ___ | Non-accelerated filer _X_ |
|-----------------------------|-----------------------|---------------------------|

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act):  YES   _    NO   X_

 

Indicate the number of shares outstanding of each of the issuer’s classes of common stock as of the latest practicable date.

 

|   | Class | Outstanding at February 8, 2008 |
|--------|-------|---------------------------------|

| Common stock, $001 par value | 5,615,355 shares |
|------------------------------|------------------|

 

| Transitional Small Business Disclosure Format (Check One): | Yes ____ | No  _X__ |
|------------------------------------------------------------|----------|----------|

INDEX

 

| Part I - Financial Information |
|--------------------------------|

 

 

|   | Item 1.  Condensed Financial Statements | 3 |
|--------|-----------------------------------------|---|

 

|   | Condensed Balance Sheets | 3 |
|--------|--------------------------|---|

 

|   | Condensed Statements of Operations | 4 |
|--------|------------------------------------|---|

 

|   | Condensed Statements of Cash Flows | 5 |
|--------|------------------------------------|---|

 

|   | Condensed Notes to Financial Statements | 6 |
|--------|-----------------------------------------|---|

 

 

|   | Item 2.  Management’s Discussion and Analysis of |
|--------|-------------------------------------------------------|

|   | Financial Condition and Results of Operations | 7 |
|--------|-----------------------------------------------|---|

 

|   | Item 3.  Controls and Procedures | 13 |
|--------|----------------------------------|----|

 

 

Part II - Other Information

 

|   | Item 2.  Unregistered Private Sale of Common Stock | 14 |
|--------|----------------------------------------------------|----|

 

|   | Item 5.  Other Information | 14 |
|--------|----------------------------|----|

 

|   | Item 6.  Exhibits | 14 |
|--------|-------------------|----|

 

 

2

**Item 1.  CONDENSED FINANCIAL STATEMENTS**

 

**PURAMED BIOSCIENCE, INC.**

**(A Development Stage Company)**

 

**Condensed Balance Sheets**

 

|                                                               | **December 31,**             |  | **June 30,**                  |
|---------------------------------------------------------------|------------------------------|--|-------------------------------|
|                                                               | **2007**                     |  | **2007**                      |
|                                                               | **(Unaudited)**              |  | **(Audited)**                 |
| ASSETS                                                        |                              |  |                               |
| Current Assets                                                |                              |  |                               |
| Cash                                                          | $                      2,824 |  | $                    97,173   |
| Prepaid Expenses                                              | -                            |  | 2,000                         |
|                                                               |                         |  |                               |
| Total Current Assets                                          | 2,824                        |  | 99,173                        |
|                                                               |                              |  |                               |
| Property and Equipment                                        |                              |  |                               |
| Computer Software                                             | 1,218                        |  | 1,218                         |
| Accumulated  Depreciation - Computer Software                 | (292)                        |  | (90)                          |
|                                                               |                         |  |                               |
| Net Property and Equipment                                    | 926                          |  | 1,128                         |
|                                                               |                              |  |                               |
| Other Assets                                                  |                              |  |                               |
| PuraMed Bioscience Products, net of accumulated               |                              |  |                               |
| amortization of $34,392 and $10,390, respectively             | 301,640                      |  | 325,642                       |
| Trademark                                                     | 3,376                        |  | 3,229                         |
| Patent                                                        | 3,374                        |  | -                             |
|                                                               |                         |  |                               |
| Total Other Assets                                            | 308,390                      |  | 328,871                       |
|                                                               |                         |  |                               |
| Total Assets                                                  | $                  312,140   |  | $                  429,172    |
|                                                               |                              |  |                               |
| LIABILITIES AND STOCKHOLDERS' EQUITY                          |                              |  |                               |
| Current Liabilities                                           |                              |  |                               |
| Accounts Payable                                              | $                      2,906 |  | $                         689 |
| Accounts Payable - Related party                              | 93,360                       |  | 18,171                        |
| Accrued Expenses                                              | 125                          |  | -                             |
| Note Payable - Officer                                        | 6,285                        |  | -                             |
|                                                               |                              |  |                               |
| Total Current Liabilities                                     | 102,676                      |  | 18,860                        |
|                                                               |                              |  |                               |
| Total Liabilities                                             | 102,676                      |  | 18,860                        |
|                                                               |                              |  |                               |
| Stockholders' Equity                                          |                              |  |                               |
| Undesignated shares, 5,000,000 shares authorized, none issued |                              |  |                               |
| Common Stock, $.001 par value, 45,000,000 shares              |                              |  |                               |
| authorized, 5,615,355 shares and 5,015,355 issued             |                              |  |                               |
| and outstanding, respectively                                 | 5,615                        |  | 584,893                       |
| Additional paid in capital                                    | 609,278                      |  | -                             |
| Deficit accumulated during the development stage              | (405,429)                    |  | (174,581)                     |
|                                                               |                         |  |                               |
| Total Stockholders' Equity                                    | 209,464                      |  | 410,312                       |
|                                                               |                              |  |                               |
| Total Liabilities & Stockholders' Equity                  | $                  312,140   |  | $                  429,172    |
|                                                               |                              |  |                               |
| See notes to financial statements.                            |                              |  |                               |

 

 

3

**PURAMED BIOSCIENCE, INC.**

**(A Development Stage Company)**

 

**Condensed Statements of Operations**

 

|                                    |                        |  |                      |  |                    |  |                  |  | **Period from**  |
|------------------------------------|------------------------|--|----------------------|--|--------------------|--|------------------|--|------------------|
|                                    |                        |  |                      |  |                    |  |                  |  | **May 9, 2006**  |
|                                    | **Three months ended** |  | **Six months ended** |  | **(inception) to** |
|                                    | **December 31,**       |  | **December 31,**     |  | **December 31,**   |  | **December 31,** |  | **December 31,** |
|                                    | **2007**               |  | **2006**             |  | **2007**           |  | **2006**         |  | **2007**         |
| Revenues                           |                        |  |                      |  |                    |  |                  |  |                  |
|                                    |                        |  |                      |  |                    |  |                  |  |                  |
| Total Revenues                     | $             -        |  | $              -     |  | $             -    |  | $             -  |  | $              - |
|                                    |                        |  |                      |  |                    |  |                  |  |                  |
| Cost of Sales                      |                        |  |                      |  |                    |  |                  |  |             |
|                                    |                   |  |                 |  |               |  |             |  |                  |
| Total Cost of Sales                | -                      |  | -                    |  | -                  |  | -                |  | -                |
|                                    |                   |  |                 |  |               |  |             |  |                  |
| Gross Profit                       | -                      |  | -                    |  | -                  |  | -                |  | -                |
|                                    |                   |  |                 |  |               |  |             |  |                  |
| Operating Expenses                 |                        |  |                      |  |                    |  |                  |  |                  |
| Selling, general and               | 12,457                 |  | 4,192                |  | 24,686             |  | 10,728           |  | 54,723           |
| administrative expenses            |                        |  |                      |  |                    |  |                  |  |                  |
| Amortization and depreciation      | 12,103                 |  | -                    |  | 24,205             |  | -                |  | 34,685           |
| Consulting fees                    | 100,867                |  | 8,000                |  | 171,675            |  | 8,000            |  | 236,261          |
| Research and development           | 233                    |  | 9,116                |  | 10,282             |  | 33,777           |  | 79,760           |
|                                    |                   |  |                 |  |               |  |             |  |                  |
| Total Operating Expenses           | 125,660                |  | 21,308               |  | 230,848            |  | 52,505           |  | 405,429          |
|                                    |                   |  |                 |  |               |  |             |  |                  |
| Net Loss                           | $(125,660)             |  | $  (21,308)          |  | $(230,848)         |  | $(52,505)        |  | $(405,429)       |
|                                    |                        |  |                      |  |                    |  |                  |  |                  |
| Loss per Common Share - Basic      |                        |  |                      |  |                    |  |                  |  |                  |
| and Diluted                        | $     (0.02)           |  | $              -     |  | $      (0.04)      |  | $              - |  |                  |
|                                    |                        |  |                      |  |                    |  |                  |  |                  |
| Average number of  common shares   |                        |  |                      |  |                    |  |                  |  |                  |
| outstanding basic and diluted      | 5,315,356              |  | -                    |  | 5,165,356          |  | -                |  |                  |
|                                    |                        |  |                      |  |                    |  |                  |  |                  |
|                                    |                        |  |                      |  |                    |  |                  |  |                  |
| See notes to financial statements. |                        |  |                      |  |                    |  |                  |  |                  |

 

 

 

4

**PURAMED BIOSCIENCE, INC.**

**(A Development Stage Company)**

 

**Condensed Statements of Cash Flows**

 

|                                                       |                            |  |                              |  | **Period from May 9,**   |
|-------------------------------------------------------|----------------------------|--|------------------------------|--|--------------------------|
|                                                       | **Six months ended**  |  | **2006 (inception) to**      |
|                                                       | **December 31, 2007**      |  | **December 31, 2006**        |  | **December 31, 2007**    |
|                                                       |                            |  |                              |  |                          |
| Cash Flows from operating activities                  |                            |  |                              |  |                          |
| Net Loss                                              | $            (230,848)     |  | $              (52,505)      |  | $            (405,429)   |
| Adjustments to reconcile net loss to net cash used in |                            |  |                              |  |                          |
| operating activities                                  |                            |  |                              |  |                          |
| Stock issued for services                             | 30,000                     |  | -                            |  | 30,000                   |
| Depreciation                                          | 203                        |  | -                            |  | 293                      |
| Amortization                                          | 24,002                     |  | -                            |  | 34,393                   |
| Prepaid Expenses                                      | 2,000                      |  | -                            |  | -                        |
| Accounts Payable - Related party                      | 75,189                     |  | -                            |  | 93,360                   |
| Accounts Payable                                      | 2,217                      |  | -                            |  | 2,904                    |
| Accrued Expenses                                      | 125                        |  | -                            |  | 125                      |
|                                                       |                       |  |                         |  |                          |
| Total Adjustments                                     | 133,736                    |  | -                            |  | 161,075                  |
|                                                       |                       |  |                         |  |                          |
| Net cash used for operating activities                | (97,112)                   |  | (52,505)                     |  | (244,354)                |
|                                                       |                       |  |                         |  |                          |
| Cash Flows from investing activities                  |                            |  |                              |  |                          |
| Patent acquisition costs                              | (3,374)                    |  | -                            |  | (3,374)                  |
| Purchase of property and equipment                    | -                          |  | -                            |  | (1,218)                  |
| Trademark acquisition costs                           | (148)                      |  | -                            |  | (3,377)                  |
|                                                       |                       |  |                         |  |                          |
| Net cash used for investing activities                | (3,522)                    |  | -                            |  | (7,969)                  |
|                                                       |                       |  |                         |  |                          |
| Cash Flows from financing activities                  |                            |  |                              |  |                          |
| Proceeds from officer                                 | 6,285                      |  | -                            |  | 6,285                    |
| Proceeds from spin off                                | -                          |  | -                            |  | 174,393                  |
| Proceeds from equity investee                         | -                          |  | 52,505                       |  | 74,469                   |
|                                                       |                       |  |                         |  |                          |
| Net cash provided by financing activities             | 6,285                      |  | 52,505                       |  | 255,147                  |
|                                                       |                            |  |                              |  |                          |
| Net (decrease) increase in cash                       | (94,349)                   |  | -                            |  | 2,824                    |
|                                                       |                            |  |                              |  |                          |
| Cash at Beginning of Period                           | 97,173                     |  | -                            |  | -                        |
|                                                       |                       |  |                         |  |                     |
| Cash at End of Period                                 | $                  2,824   |  | $                          - |  | $                  2,824 |
|                                                       |                            |  |                              |  |                          |
|                                                       |                            |  |                              |  |                          |
|                                                       |                            |  |                              |  |                          |
| See notes to financial statements.                    |                            |  |                              |  |                          |

 

 

 

5

**PURAMED BIOSCIENCE, INC.**

**(A Development Stage Company)**

 

**Condensed Notes to Financial Statements**

 

**PURAMED BIOSCIENCE, INC.**

 

6

**(A Development Stage Company)**

 

**Condensed Notes to Financial Statements**

 

 

7

**Item 2.  MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS**

 

*The following discussion should be read and considered along with our condensed financial statements and related notes included in this 10-QSB.  These financial statements were prepared in accordance with United States Generally Accepted Accounting Principles (U.S. GAAP).  This discussion and analysis contains forward-looking statements that involve risks, uncertainties and assumptions.  Our actual results may differ substantially from those anticipated in these forward-looking statements as a result of various factors including those set forth in the “Risk Factors” section of our Form 10-SB filing for fiscal year ending June 30, 2007 filed with the SEC on August 16, 2007.*

 

**Background**

 

PuraMed BioScience, Inc. (“PuraMed” or the “Company”) was incorporated in Minnesota on May 9, 2006 as a wholly-owned subsidiary of Wind Energy America, Inc. (formerly “Dotronix, Inc.”) for the purpose of engaging in the business of developing and marketing non-prescription over-the-counter healthcare products to remedy various ailments.

 

In late 2006, PuraMed’s former parent company decided to spin off its PuraMed subsidiary and related healthcare products business. Accordingly, on April 12, 2007, Wind Energy America, Inc. effected a spin-off of PuraMed to shareholders of Wind Energy America, Inc. on a pro rata dividend basis whereby one common share of PuraMed will be distributed for each five common shares of Wind Energy America, Inc. Since the April 12, 2007 effective date of the spin-off, PuraMed and Wind Energy America, Inc. have operated separately, with their respective managements, businesses, assets and capital structures being completely independent from each other. 

 

The actual distribution date for PuraMed stock from this spin-off could not occur until after our Form 10-SB Registration Statement of PuraMed becomes effective with the Securities and Exchange Commission (SEC).  Our Form 10-SB registration is now effective and the company is now is the process of distributing its common stock related to the spin-off.

 

Detailed information regarding this spin-off of PuraMed from Wind Energy America, Inc. (formerly Dotronix, Inc.) is contained in a Form 8-K and exhibit thereto which were filed with the SEC April 10, 2007, and can be readily accessed at the SEC website www.sec.gov.

 

**Overview of Business**

 

The Company is engaged in the business of developing and marketing a line of non-prescription medicinal or healthcare products to be marketed through various retail channels under the PuraMed BioScience brand and trademark. The Company has recently completed all product development and design packaging for its initial two products, PuraMed Migraine and PuraMed Sleep, and expects to begin their commercial introduction to the marketplace during the first half of calendar 2008. 

 

Product development and design packaging of all PuraMed products have been conducted entirely by the Company’s two principal officers, Russell Mitchell and James Higgins:  Messrs. Mitchell and Higgins have extensive and lengthy experience in new product development and marketing of non-prescription medical products and nutritional supplements and the many varied promotional activities involved in their marketing rollouts. For example, Mitchell Health Technologies served as the master broker for the launch of Quigley Corp’s “Cold-Eeze” treatment for common colds, which within 18 months exceeded $70 

million in annual wholesale revenues. The Company considers the long and successful professional involvement of its management team in our industry to be a valuable asset to draw upon to achieve the future growth and profitability anticipated by the Company. 

 

The Company intends to enter the OTC healthcare products marketplace by employing “direct consumer” marketing via print and TV ads and commercials followed by broad retail distribution through mass merchandisers, drug stores and food chains. PuraMed is currently undergoing substantial activities directed toward its initial commercial launch of PuraMed brand products. 

 

**PuraMed Migraine**

 

PuraMed Migraine provides acute relief from migraine headaches, and contains the herbs feverfew and ginger as principal ingredients. PuraMed believes that its specific formulation of these herbs for its migraine remedy is unique and proprietary, providing relief from these severe headaches in minutes. The Company believes it will capture a material segment of the huge migraine headache remedy market. We believe that Americans spend in excess of $6 billion annually on headache pain relievers, and that over half of sufferers of migraine headaches rely exclusively on non-prescription medications. 

 

We believe that at least 30 million Americans suffer from chronic migraine headaches with over 20 million of them having “severe” migraine conditions. Thus migraine headaches constitute a severe and disabling condition for millions of people. We further believe that the economic burden alone to the U.S. economy is in excess of $20 billion annually.

 

PuraMed Migraine is effective, available as a non-prescription remedy, free of significant side effects, and affordable compared to more expensive migraine drugs based on prescription chemical formulations.

 

**PuraMed Sleep**

 

PuraMed Sleep is a new class of non-prescription sleep aid without any known side effects, and contains a proprietary blend of natural ingredients including Valerian, St. John’s Wort, and Chamomile. We believe the PuraMed blend of these ingredients provides an effective remedy for insomnia and other sleep disorders. The sleep aid market features products based primarily on chemical antihistamines. 

 

Accordingly, our PuraMed Sleep product provides a wide open market opportunity for an effective, natural alternative to prescription medications, which are somewhat addictive and often cause withdrawal symptoms and other side effects. 

 

We have priced PuraMed Sleep as a premium sleep aid product, which provides us with a projected gross margin of approximately 80%. This large margin should leave us substantial room for ample introductory promotion, product allowances and other incentives conducive to achieving rapid market penetration.

 

Similar to the migraine remedy market, the market for sleep aid products represents a very large segment of the overall healthcare products marketplace. We believe that over half of all adults in the U.S. suffer from sleep disorders, and that many of them experience persistent insomnia. The National Center on Sleep Disorders has reported that there are as many as 70 million problem sleepers in the U.S. with many of them suffering from chronic sleep disorders. We believe that insomnia is second only to pain as a healthcare complaint. 

 

9

**Future PuraMed Products**

 

We have completed development of additional PuraMed non-prescription products, which we intend to launch commercially over the next couple years after establishing a solid market for our initial two products. These other PuraMed products include:

 

*PuraMed Tension Headache* – provides relief for common tension headaches which afflict a majority of American adults from time to time. The PuraMed remedy providing headache relief features a unique proprietary formulation of St. John’s Wort and common aspirin.

 

*PuraMed Smoker’s Pal –*provides relief from the symptoms associated with nicotine withdrawal with the added benefit of an appetite suppressant.

 

*PuraMed Leg Cramps* – provides relief of problematic leg cramps associated with Restless Leg Syndrome affecting a large segment of the population in the U.S.

 

*PuraMed Gastro/Intestinal* – provides relief of symptoms associated with nighttime reflux disorders.

 

When introduced commercially, these other products will be packaged and branded much like the initial PuraMed products, since we intend to devote substantial efforts and resources toward gaining a favorable and consistent brand and packaging for all PuraMed products to attempt to make them instantly recognizable on retail store shelves.

 

**Sublingual Delivery System**

 

All PuraMed non-prescription medications will be absorbed by the user through the use of under-the tongue application known as “sublingual.” The use of sublingual delivery provides fast relief for whatever ailment or condition is being treated. Unlike the majority of pills and medications absorbed through the stomach directly, PuraMed products are placed and absorbed directly under the tongue. Advantages of sublingual dispensing of drugs and medications include faster acting absorption for quick relief, improved efficacy, less stomach upset, and fewer side effects.

 

PuraMed has secured reliable contract manufacturers to produce and package PuraMed medications in easy-to-use sublingual dispensers, which contractors are experienced in the production of this specific type of dispenser. PuraMed believes that its benchmark use of sublingual dispensers will distinguish its products favorably in comparison to most competing OTC products now in the marketplace.

 

**Regulation of PuraMed Products**

 

Unlike prescription drugs or medications, non-prescription healthcare remedies such as PuraMed products do not require FDA approval prior to entering the market. They are nonetheless subject to substantial FDA and other federal regulations governing their use, labeling, advertising, manufacturing and ingredients. PuraMed believes that its current and proposed development, formulation, marketing and other practices and procedures will comply fully with all governmental regulations applicable to PuraMed Products. 

 

**Business Structure**

 

PuraMed will function primarily as a research and development, marketing and sales organization. Product manufacturing, packaging, product fulfillment and other operations will be outsourced to experienced and reliable third parties through contracts controlled by PuraMed. PuraMed believes this 

 

10

structure will reduce significantly the development stage costs and development time related to launching each PuraMed product commercially.

 

**Product Manufacturing**

 

Production and packaging of PuraMed products will be outsourced to various contract manufacturers known by PuraMed’s management from prior substantial business and contract dealings. Due to the business and contacts developed by PuraMed management over the past years with leading contract manufacturers, PuraMed is convinced it can obtain professional and timely production, packaging and delivery of all PuraMed products. 

 

**Sales and Marketing**

 

PuraMed intends to launch its initial two products commercially through the following three-phase process:

 

***Phase One Rollout:  Direct Response***. A series of print advertisements will be published nationally in secondary market newspapers, which initial ads will allow PuraMed to test and refine our advertising message. After refining this initial advertising and identifying primary customer bases, PuraMed will create and have broadcasted television infomercials as well as standard TV commercials. PuraMed will also employ website and toll-free telephone access in conjunction with its print and TV direct response campaigns. PuraMed anticipates beginning its Phase One Rollout during the first quarter of calendar 2008.

 

***Phase Two Rollout:  Retail Drugstores***. PuraMed expects to develop substantial product sales and a defined customer base from its direct response marketing phase by the summer of 2008. It will then begin marketing through approximately 18,000 retail drugstores already targeted by PuraMed, including Walgreens, Rite Aid, CVS and others. Due to PuraMed’s management having extensive and good relationships with targeted retail outlets for PuraMed products, PuraMed believes it has the ability to place its products on the shelf in all its targeted retail outlets.

 

***Phase Three Rollout:  Further Retail Outlets.*** A few months after beginning the Phase Two Rollout, PuraMed will launch Phase Three which will consist of placing PuraMed products in a further approximately 21,000 targeted retail outlets including mass merchandisers such as Wal-Mart and Target, food store chains such as SuperValu, Kroger and Safeway, and additional well-known regional drugstores. 

 

PuraMed has selected its targeted retailers according to various material criteria, including cost of entry, geography, demographics and consumer preference.

 

After achieving initial distribution for PuraMed products, PuraMed will initiate a comprehensive and ongoing promotional campaign directed toward consumer groups it has identified from its product rollouts.

 

**Results of Operations**

 

*Revenues*

 

Since our 2006 inception, we have generated no revenues.

 

11

*Operating Expenses*

 

From our inception in May 2006, through December 31, 2007, we have incurred total operating expenses of $405,429 including $79,760 of research and development expenses, $236,261 of consulting fees and $54,723 of selling, general and administrative expenses.

 

Research and development expenses consist primarily of product development and marketing strategy costs.

 

Selling, general and administrative expenses consist primarily of facility rent and maintenance and administrative overhead costs.

 

Consulting fees include payments to our management and salaries outsourced for accounting and administrative personnel.

 

**Comparison of Operations for Three Months Ended December 31, 2007 and 2006**

 

*Revenue*

 

There were no revenues for the three months ended December 31, 2007 and 2006.

 

*Research and Development Expenses*

 

Research and development expenses for the three months ended December 31, 2007 were $233 compared to $9,116 for the three months ended December 31, 2006.  Decreased research and development expenses for the 2007 period compared to 2006 were due to decreased development needed as we approached commercial production.

 

*Selling, General and Administrative Expenses*

 

Selling, general and administrative expenses for the three months ended December 31, 2007 were $12,457 compared to $4,192 for the three months ended December 31, 2006.  Increased selling, general and administrative expenses for the three month period of 2007 compared to the same three month of 2006 were due to primarily to increases in most all expense areas such as rent, office expenses and professional fees.

 

**Comparison of Operations for Six Months Ended December 31, 2007 and 2006**

 

*Revenue*

 

There were no revenues for the six months ended December 31, 2007 and 2006.

 

*Research and Development Expenses*

 

Research and development expenses for the six months ended December 31, 2007 were $10,282 compared to $33,777 for the six months ended December 31, 2006.  Decreased research and development expenses for the 2007 period compared to 2006 were due to decreased development needed as we approach commercial production.

 

12

*Selling, General and Administrative Expenses*

 

Selling, general and administrative expenses for the six months ended December 31, 2007 were $24,686 compared to $10,728 for the six months ended December 31, 2006.  Increased selling, general and administrative expenses for the six month period of 2007 compared to the same six month of 2006 were due to primarily to increases in most all expense areas such as rent, office expenses and professional fees.

 

*Loss from Operations*

 

Operational losses for the six months ended December 31, 2007 were $230,848 compared to $52,505 for the six months ended December 31, 2006.  These increased losses were due to our increased marketing and administrative expenses due to the upcoming launch of our commercial products

 

**Financial Condition, Liquidity and Capital Resources**

 

As of December 31, 2007, the Company had limited cash of $2,824 and a working capital deficit of ($99,852).On November 27, 2007, Mr. Mitchell loaned the Company $6,285 on a short term note basis to cover monthly overhead expenses.  Mr. Mitchell and Mr. Higgins will continue to loan the Company funds as needed until our plan to raise capital from the sale of our equity securities begins as discussed below.

 

We intend to raise the funds needed to implement our plan of operation through private sales of our equity securities. There is no assurance, however, that we will be successful in raising the necessary capital to implement our business plan, either through debt or equity sources.

 

**Critical Accounting Policies**

 

**PuraMed BioscienceTM Products:**

 

PuraMed BioscienceTM products consist primarily of the cost of trade secrets, formulas, scientific and manufacturing know-how, trade names, marketing material and other intellectual property and are amortized on a straight-line basis over an estimated useful life of seven years.

 

The carrying value is reviewed periodically or when factors indicating impairment are present.  The impairment loss is measured as the amount by which the carrying value of the assets exceeds the fair value of the assets.  The Company believes that no impairment exists at December 31, 2007.

 

**Forward-Looking Statements**

 

The Private Securities Litigation Reform Act of 1985 provides a safe harbor for forward-looking statements made by the Company.  All statements, other than statements of historical fact, which address activities, actions, goals, prospects, or new developments that we expect or anticipate will or may occur in the future, including such things as prospects for obtaining additional capital and our goal of participating in new business ventures and other such matters are forward-looking statements.  Any one or a combination of factors could materially affect our financial condition and ability to achieve our goal. These factors include competition for business opportunities, unexpected costs or expenses, legal and regulatory matters, and conditions in the capital markets. Because of the factors listed above, risk factors identified in our Registration Statement on Form 10-SB for the year ended June 30, 2007 filedwith the Securities and Exchange Commission, and other unknown factors beyond our control, actual results may differ from those in the forward-looking statements. 

 

13

**Item 3. CONTROLS AND PROCEDURES**

Evaluation of disclosure controls and procedures. 

As of the end of the period covered by this report, the Company conducted an evaluation, under the supervision and with the participation of the Chief Executive Officer and Chief Financial Officer, of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 (the “Exchange Act”)).  Based on this evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures are effective to ensure that information required to be disclosed by the Company in reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission rules and forms.

 

Changes in internal controls*.* 

There were no changes in the Company’s internal controls over financial reporting that occurred during the period covered by this report that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

 

**PART II – OTHER INFORMATION**

 

**Item 2.  Unregistered Private Sale of Common Stock**

 

None

 

**Item 5.  Other Information**

 

None

**Item 6.  Exhibits**

 

**PURAMED BIOSCIENCE INC.**

**EXHIBIT INDEX**

**QUARTERLY REPORT ON FORM 10-QSB**

**FOR QUARTER ENDED DECEMBER 31, 2007**

 

|   | 31.1* | Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
|--------|-------|-----------------------------------------------------------------------------------------------------|

 

|   | 31.2* | Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
|--------|-------|-----------------------------------------------------------------------------------------------------|

 

|   | 32.1* | Certification of Chief Executive Officer and Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
|--------|-------|---------------------------------------------------------------------------------------------------------------------------------|

 

*Filed herewith

 

 

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