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Table of Contents

UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington, DC 20549

FORM 10-Q

(Mark One)

|[X] | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
     SECURITIES EXCHANGE ACT OF 1934
|--- | --------------------------------------------------------------------------------------------

For the quarterly period ended September 30, 2008

or

|[  ] | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
     SECURITIES EXCHANGE ACT OF 1934
|---- | ---------------------------------------------------------------------------------------------

For the transition period from ___________ to __________

Commission file number 001-15543

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PALATIN TECHNOLOGIES, INC.(Exact name of registrant as specified in its charter)

|Delaware                                                            | 95-4078884                          
|------------------------------------------------------------------- | ------------------------------------
|(State or other jurisdiction of
     incorporation or organization) | (I.R.S. Employer Identification No.)
|                                                                    |                                     
|4C Cedar Brook Drive                                                |                                     
|Cranbury, New Jersey                                                | 08512                               
|(Address of principal executive
     offices)                       | (Zip Code)                          

(609) 495-2200(Registrants telephone number,
including area code)

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 xNo o

Indicate by check mark whether the
registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or
a smaller reporting company. See the definitions of large accelerated filer,
accelerated filer and smaller reporting company in Rule 12b-2 of
the Exchange Act. (Check one):

| |                                               |  |                                      
| | --------------------------------------------- |  | -------------------------------------
| | Large accelerated filer
          o           |  | Accelerated filer
          o        
| | Non-accelerated filer
          o             |  | Smaller reporting company
          x
| | (Do not check if a smaller reporting company) |  |                                      

Indicate by check mark whether the
registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  Yeso Nox

As of November 13, 2008, 86,662,901
shares of the registrants common stock, par value $.01 per share, were outstanding.

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PALATIN TECHNOLOGIES, INC.Table of Contents

|                                    |                                                                                                   |     
|----------------------------------- | ------------------------------------------------------------------------------------------------- | ----
|                                    |                                                                                                   | Page
|PART I  FINANCIAL
     INFORMATION
|Item 1.                             | Financial Statements (Unaudited)                                                                  |     
|                                    | Consolidated Balance Sheets
     as of September 30, 2008 and June 30, 2008                       | 2   
|                                    | Consolidated Statements of Operations
     for the Three Months Ended September 30, 2008 and 2007 | 3   
|                                    | Consolidated Statements of Cash Flows
     for the Three Months Ended September 30, 2008 and 2007 | 4   
|                                    | Notes to Consolidated Financial
     Statements                                                   | 5   
|Item 2.                             | Managements Discussion and Analysis of
     Financial Condition and Results of Operations        | 10  
|Item 3.                             | Quantitative and Qualitative
     Disclosures About Market Risk                                   | 13  
|Item 4T.                            | Controls and Procedures                                                                           | 13  

PART II  OTHER
INFORMATION

|         |                                                                  |   
|-------- | ---------------------------------------------------------------- | --
|Item 1.  | Legal Proceedings                                                | 14
|Item 1A. | Risk Factors                                                     | 14
|Item 2.  | Unregistered Sales of Equity Securities and
     Use of Proceeds | 14
|Item 3.  | Defaults Upon Senior Securities                                  | 14
|Item 4.  | Submission of Matters to a Vote of Security
     Holders         | 14
|Item 5.  | Other Information                                                | 14
|Item 6.  | Exhibits                                                         | 14

SIGNATURES

1

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Table of Contents

PART I  FINANCIAL
INFORMATION

Item 1. Financial Statements

PALATIN TECHNOLOGIES,
INC.Consolidated Balance Sheets(unaudited)

|                                                                  |                   |  |              |              |   |  |   |              |  
|----------------------------------------------------------------- | ----------------- |  | ------------ | ------------ | - |  | - | ------------ | -
|                                                                  | September 30,2008 |  | June 30,2008
|ASSETS                                                           
|Current assets:                                                   |                   |  |              |              |   |  |   |             
|Cash and cash equivalents                                         |                   |  | $            | 4,735,975    |   |  | $ | 9,421,770    |  
|Available-for-sale investments                                    |                   |  |              | 3,352,712    |   |  |   | 3,352,771    |  
|Accounts receivable                                               |                   |  |              | 342,925      |   |  |   | 5,747        |  
|Prepaid expenses and other current assets                         |                   |  |              | 403,719      |   |  |   | 484,362      |  
|Total current assets                                              |                   |  |              | 8,835,331    |   |  |   | 13,264,650   |  
|                                                                 
|Property and equipment, net                                       |                   |  |              | 4,796,173    |   |  |   | 5,128,076    |  
|Restricted cash                                                   |                   |  |              | 475,000      |   |  |   | 475,000      |  
|Other assets                                                      |                   |  |              | 261,219      |   |  |   | 257,198      |  
|Total assets                                                      |                   |  | $            | 14,367,723   |   |  | $ | 19,124,924   |  
|                                                                 
|LIABILITIES AND STOCKHOLDERS EQUITY                             
|Current liabilities:                                             
|Capital lease obligations, current portion                        |                   |  | $            | 237,280      |   |  | $ | 263,128      |  
|Accounts payable                                                  |                   |  |              | 580,844      |   |  |   | 635,183      |  
|Accrued expenses                                                  |                   |  |              | 1,643,576    |   |  |   | 1,666,628    |  
|Accrued compensation                                              |                   |  |              | 447,247      |   |  |   | 767,509      |  
|Deferred revenue, current portion                                 |                   |  |              | 1,666,669    |   |  |   | 1,666,669    |  
|Total current liabilities                                         |                   |  |              | 4,575,616    |   |  |   | 4,999,117    |  
|                                                                 
|Capital lease obligations, net of current portion                 |                   |  |              | 80,734       |   |  |   | 121,629      |  
|Deferred rent, net of current portion                             |                   |  |              | 1,371,608    |   |  |   | 1,479,794    |  
|Deferred revenue, net of current portion                          |                   |  |              | 5,555,552    |   |  |   | 5,972,220    |  
|Total liabilities                                                 |                   |  |              | 11,583,510   |   |  |   | 12,572,760   |  
|                                                                 
|Commitments and contingencies (Note 6)                           
|                                                                 
|Stockholders equity:                                             |                   | 
|Preferred stock of $.01 par value - authorized 10,000,000 shares;
|Series A Convertible; issued and outstanding 4,997 shares as of  
|September 30, 2008 and June 30, 2008, respectively                |                   |  |              | 50           |   |  |   | 50           |  
|Common stock of $.01 par value  authorized 150,000,000 shares;  
|issued and outstanding 85,546,077 and 85,524,077 shares as of    
|September 30, 2008 and June 30, 2008, respectively                |                   |  |              | 855,461      |   |  |   | 855,241      |  
|Additional paid-in capital                                        |                   |  |              | 208,761,597  |   |  |   | 208,247,194  |  
|Accumulated other comprehensive income                            |                   |  |              | 29,058       |   |  |   | 29,117       |  
|Accumulated deficit                                               |                   |  |              | (206,861,953 | ) |  |   | (202,579,438 | )
|Total stockholders equity                                        |                   |  |              | 2,784,213    |   |  |   | 6,552,164    |  
|Total liabilities and stockholders equity                        |                   |  | $            | 14,367,723   |   |  | $ | 19,124,924   |  

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

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Table of Contents

PALATIN TECHNOLOGIES,
INC.Consolidated Statements of Operations(unaudited)

|                                            |                                  |  |      |            |   |  |   |            |  
|------------------------------------------- | -------------------------------- |  | ---- | ---------- | - |  | - | ---------- | -
|                                            | Three Months Ended September 30,
|                                            | 2008                             |  | 2007
|REVENUES:                                  
|Licenses and contracts                      |                                  |  | $    | 753,846    |   |  | $ | 8,977,731  |  
|                                           
|OPERATING EXPENSES:                         |                                  | 
|Research and development                    |                                  |  |      | 3,657,999  |   |  |   | 7,943,877  |  
|General and administrative                  |                                  |  |      | 1,456,848  |   |  |   | 1,659,010  |  
|Total operating expenses                    |                                  |  |      | 5,114,847  |   |  |   | 9,602,887  |  
|                                           
|Loss from operations                        |                                  |  |      | (4,361,001 | ) |  |   | (625,156   | )
|                                           
|OTHER INCOME (EXPENSE):                    
|Investment income                           |                                  |  |      | 82,980     |   |  |   | 396,621    |  
|Interest expense                            |                                  |  |      | (4,494     | ) |  |   | (18,229    | )
|Total other income, net                     |                                  |  |      | 78,486     |   |  |   | 378,392    |  
|                                           
|NET LOSS                                    |                                  |  | $    | (4,282,515 | ) |  | $ | (246,764   | )
|                                           
|Basic and diluted net loss per common share |                                  |  | $    | (0.05      | ) |  | $ | (0.00      | )
|                                           
|Weighted average number of common shares   
|outstanding used in computing basic and    
|diluted net loss per common share           |                                  |  |      | 85,524,316 |   |  |   | 85,177,298 |  

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

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Table of Contents

PALATIN TECHNOLOGIES,
INC.Consolidated Statements of Cash Flows(unaudited)

|                                                         |                                  |  |      |            |   |  |   |            |  
|-------------------------------------------------------- | -------------------------------- |  | ---- | ---------- | - |  | - | ---------- | -
|                                                         | Three Months Ended September 30,
|                                                         | 2008                             |  | 2007
|CASH FLOWS FROM OPERATING ACTIVITIES:                   
|Net loss                                                 |                                  |  | $    | (4,282,515 | ) |  | $ | (246,764   | )
|Adjustments to reconcile net loss to net cash            |                                  | 
|used in operating activities:                            |                                  | 
|Depreciation and amortization                            |                                  |  |      | 335,743    |   |  |   | 340,724    |  
|Stock-based compensation                                 |                                  |  |      | 514,623    |   |  |   | 450,463    |  
|Changes in operating assets and liabilities:             |                                  | 
|Accounts receivable                                      |                                  |  |      | (337,178   | ) |  |   | 147,572    |  
|Prepaid expenses and other assets                        |                                  |  |      | 76,622     |   |  |   | 1,038,067  |  
|Accounts payable                                         |                                  |  |      | (54,339    | ) |  |   | (154,548   | )
|Accrued expenses and other liabilities                   |                                  |  |      | (451,500   | ) |  |   | (412,871   | )
|Deferred revenues                                        |                                  |  |      | (416,668   | ) |  |   | (8,169,031 | )
|Net cash used in operating activities                    |                                  |  |      | (4,615,212 | ) |  |   | (7,006,388 | )
|                                                        
|CASH FLOWS FROM INVESTING ACTIVITIES:                    |                                  | 
|Purchases of property and equipment                      |                                  |  |      | (3,840     | ) |  |   | (156,321   | )
|Net cash used in investing activities                    |                                  |  |      | (3,840     | ) |  |   | (156,321   | )
|                                                        
|CASH FLOWS FROM FINANCING ACTIVITIES:                    |                                  | 
|Payments on capital lease obligations                    |                                  |  |      | (66,743    | ) |  |   | (89,634    | )
|Proceeds from exercise of common stock warrants          |                                  |  |      | -          |   |  |   | 110,229    |  
|Net cash provided by (used in) financing activities      |                                  |  |      | (66,743    | ) |  |   | 20,595     |  
|                                                        
|NET DECREASE IN CASH AND                                 |                                  | 
|CASH EQUIVALENTS                                         |                                  |  |      | (4,685,795 | ) |  |   | (7,142,114 | )
|                                                        
|CASH AND CASH EQUIVALENTS, beginning                     |                                  | 
|of period                                                |                                  |  |      | 9,421,770  |   |  |   | 31,447,615 |  
|                                                        
|CASH AND CASH EQUIVALENTS, end of period                 |                                  |  | $    | 4,735,975  |   |  | $ | 24,305,501 |  
|                                                        
|SUPPLEMENTAL CASH FLOW INFORMATION:                      |                                  | 
|Cash paid for interest                                   |                                  |  | $    | 10,494     |   |  | $ | 18,229     |  
|Equipment acquired under financing agreements            |                                  |  |      | -          |   |  | $ | 186,989    |  
|Unrealized gain (loss) on available-for-sale investments |                                  |  | $    | (59        | ) |  | $ | 15,814     |  

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

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PALATIN TECHNOLOGIES, INC.Notes to
Consolidated Financial Statements (unaudited)

(1)    ORGANIZATION

Nature
of Business  Palatin Technologies, Inc. (Palatin or the Company) is a
biopharmaceutical company dedicated to the development of peptide, peptide mimetic and
small molecule agonist compounds with a focus on melanocortin and natriuretic peptide
receptor systems. Palatin has a diverse pipeline of active development programs targeting
melanocortin and natriuretic receptors, including proposed products in the cardiovascular
field for treatment of heart failure, hard-to-control hypertension and for cardiac surgery
organ protection, and proposed products for sexual dysfunction, obesity and metabolic
syndrome. The melanocortin system is involved in a large and diverse number of physiologic
functions, and therapeutic agents modulating this system may have the potential to treat a
variety of conditions and diseases, including sexual dysfunction, obesity and related
disorders, ischemiareperfusion injury, hemorrhagic shock and inflammation-related
diseases. The natriuretic peptide receptor system has numerous cardiovascular functions,
and therapeutic agents modulating this system may be useful in treatment of heart failure,
hypertension and other cardiovascular diseases.

The
Companys products in development include PL-3994, a peptidomimetic natriuretic
peptide receptor A agonist, for treatment of heart failure and difficult-to-control
hypertension, bremelanotide, a peptide melanocortin receptor agonist, for prevention of
organ damage secondary to cardiac surgery and related indications, and PL-6983, a peptide
melanocortin receptor agonists, for treatment of female sexual dysfunction. The Company
has a licensing and research collaboration agreement with AstraZeneca AB (AstraZeneca) to
discover, develop and commercialize compounds that target melanocortin receptors for the
treatment of obesity, diabetes and related metabolic syndrome. Sales, marketing and
distribution of the Companys NeutroSpec product, a radiolabeled monoclonal antibody
product for imaging and diagnosing infection which is the subject of a strategic
collaboration agreement with the Mallinckrodt division of Covidien Ltd. (Mallinckrodt),
were voluntarily suspended in December 2005 following the occurrence of certain serious
adverse events involving patients who received NeutroSpec. Significant development
activities pertaining to NeutroSpec are currently suspended while the Company and
Mallinckrodt evaluate future development and marketing alternatives.

Key
elements of the Companys business strategy include entering into alliances and
partnerships with pharmaceutical companies to facilitate the development, manufacture,
marketing, sale and distribution of the Companys product candidates under
development, partial funding of the Companys development and discovery programs with
the cash flow from collaboration agreements and, depending on the availability of
sufficient funding, expansion of the Companys pipeline through the utilization of
its melanocortin expertise and drug discovery technologies and opportunistic acquisition
of synergistic products and technologies.

Business
Risk and Liquidity  The Company has incurred negative cash flows from operations
since its inception, and has expended, and expects to continue to expend in the future,
substantial funds to complete its planned product development efforts. As shown in the
accompanying consolidated financial statements, the Company has an accumulated deficit as
of September 30, 2008 and incurred a net loss for the three months ended September 30,
2008. The Company anticipates incurring additional losses in the future as a result of
spending on its development programs. To achieve profitability, the Company, alone or with
others, must successfully develop and commercialize its technologies and proposed
products, conduct successful preclinical studies and clinical trials, obtain required
regulatory approvals and successfully manufacture and market such technologies and
proposed products. The time required to reach profitability is highly uncertain, and there
can be no assurance that the Company will be able to achieve profitability on a sustained
basis, if at all.

As
of September 30, 2008, the Companys cash and cash equivalents were $4,735,975 and
its available-for-sale investments were $3,352,712. The accompanying consolidated financial statements have been
prepared assuming that the Company continues as a going concern, which contemplates the
realization of assets and the satisfaction of liabilities in the normal course of
business. The Company is exploring sources of additional capital through public or private
financing or collaborative agreements with the intent to raise additional capital. There
is no assurance that required additional capital will be obtained on terms acceptable to
the Company or at all. These matters raise substantial doubt over the Companys
ability to continue as a going concern.

The
nature and timing of the Companys development activities are highly dependent on
its financing activities. Management plans to continue to refine its operations, control
expenses, evaluate alternative methods to conduct its business, and seek available
sources of public or private financing and sharing of development costs through
collaborative agreements or other arrangements. Should appropriate sources of financing
not be available,

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management will curtail operations
and delay clinical trials and research activities until such time, if ever, as
appropriate financing is available. There can be no assurance that the Company will be
able to obtain financing when required or that financing efforts will be successful.

Concentrations
 Concentrations in the Companys assets and operations subject it to certain
related risks. Financial instruments that subject the Company to concentrations of credit
risk primarily consist of cash and cash equivalents, available-for-sale investments and
accounts receivable. The Companys cash and cash equivalents are primarily invested
in one money market fund sponsored by a large financial institution. The Companys
accounts receivable balance as of September 30, 2008 consists of amounts due from its
collaboration partners, including $337,178 due from AstraZeneca and $5,747 due from
Mallinckrodt. Revenues from collaboration partners as a percentage of total revenues were
as follows:

|                           |                                  |      |      |     | 
|-------------------------- | -------------------------------- | ---- | ---- | --- | 
|                           | Three Months Ended September 30, |     
|                           | 2008                             |      | 2007 |    
|AstraZeneca                |                                  | 100% |      | 91% | 
|King Pharmaceuticals, Inc. |                                  | -    |      | 8%  | 
|Mallinckrodt               |                                  | -    |      | 1%  | 

(2)    BASIS
OF PRESENTATION

The
accompanying unaudited consolidated financial statements have been prepared in accordance
with U.S. generally accepted accounting principles for interim financial information and
with the instructions to Form 10-Q. Accordingly, they do not include all of the
information and footnote disclosures required to be presented for complete financial
statements. In the opinion of management, these consolidated financial statements contain
all adjustments (consisting of normal recurring adjustments) considered necessary to
present fairly the Companys financial position as of September 30, 2008, and its
results of operations and its cash flows for the three months ended September 30, 2008 and
2007. The results of operations for the three-month period ended September 30, 2008 may
not necessarily be indicative of the results of operations expected for the full year,
except that the Company expects to incur a significant loss for the fiscal year ending
June 30, 2009.

The
accompanying consolidated financial statements should be read in conjunction with the
audited consolidated financial statements and notes thereto included in the Companys
annual report on Form 10-K for the year ended June 30, 2008, filed with the Securities and
Exchange Commission (SEC), which includes consolidated financial statements as of June 30,
2008 and 2007 and for each of the fiscal years in the three-year period ended June 30,
2008.

(3)    SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES

Principles
of Consolidation  The consolidated financial statements include the accounts of
Palatin and its wholly-owned inactive subsidiary. All significant intercompany accounts
and transactions have been eliminated in consolidation.

Use
of Estimates  The preparation of consolidated financial statements in conformity
with U.S. generally accepted accounting principles requires management to make estimates
and assumptions that affect the reported amount of assets and liabilities and disclosure
of contingent assets and liabilities at the date of the consolidated financial statements
and the reported amounts of revenues and expenses during the reporting period. Actual
results could differ from those estimates.

Cash
and Cash Equivalents  Cash and cash equivalents include cash on hand, cash in banks
and all highly liquid investments with a purchased maturity of less than three months.
Restricted cash secures letters of credit for security deposits on leases.

Investments
 The Company classifies its investments as available-for-sale investments and all
such investments are recorded at fair value based on quoted market prices. Unrealized
holding gains and losses, net of the related tax effect, if any, are generally excluded
from earnings and are reported in accumulated other comprehensive income/loss until
realized. Interest and dividends on securities classified as available-for-sale are
included in investment income. Gains and losses are recorded in the statement of
operations when realized or when unrealized holding losses are determined to be other than
temporary, on a specific-identification basis.

Fair
Value of Financial Instruments  The Companys financial instruments
consist primarily of cash and cash equivalents, available-for-sale investments, accounts
receivable, accounts payable, and capital lease

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obligations. Management believes
that the carrying value of these assets and liabilities are representative of their
respective fair values based on quoted market prices for investments and the short-term
nature of the other instruments.

Property
and Equipment  Property and equipment consists of office and laboratory equipment,
office furniture and leasehold improvements and includes assets acquired under capital
leases. Property and equipment are recorded at cost. Depreciation is recognized using the
straight-line method over the estimated useful lives of the related assets, generally five
years for laboratory equipment, seven years for office furniture and equipment and the
lesser of the term of the lease or the useful life for leasehold improvements.
Amortization of assets acquired under capital leases is included in depreciation expense.
Maintenance and repairs are expensed as incurred while expenditures that extend the useful
life of an asset are capitalized.

Impairment
of Long-Lived Assets  The Company reviews its long-lived assets for impairment
whenever events or changes in circumstances indicate that the carrying amount of the
assets may not be fully recoverable. To determine recoverability of a long-lived asset,
management evaluates whether the estimated future undiscounted net cash flows from the
asset are less than its carrying amount. If impairment is indicated, the long-lived asset
would be written down to fair value. Fair value is determined by an evaluation of
available price information at which assets could be bought or sold, including quoted
market prices if available, or the present value of the estimated future cash flows based
on reasonable and supportable assumptions.

Deferred
Rent  The Companys operating leases provide for rent increases over the terms
of the leases. Deferred rent consists of the difference between periodic rent payments and
the amount recognized as rent expense on a straight-line basis, as well as tenant
allowances for leasehold improvements. Rent expenses are being recognized ratably over the
terms of the leases.

Revenue
Recognition  Revenue from corporate collaborations and licensing agreements consists
of up-front fees, research and development funding, and milestone payments. Non-refundable
up-front fees are deferred and amortized to revenue over the related performance period.
The Company estimates the performance period as the period in which it performs certain
development activities under the applicable agreement. Reimbursements for research and
development activities are recorded in the period that the Company performs the related
activities under the terms of the applicable agreements. Revenue resulting from the
achievement of milestone events stipulated in the applicable agreements is recognized when
the milestone is achieved, provided that such milestone is substantive in nature.

Research
and Development Costs  The costs of research and development activities are charged
to expense as incurred, including the cost of equipment for which there is no alternative
future use.

Stock
Options  Effective July 1, 2005, the Company adopted Statement of Financial
Accounting Standards (SFAS) 123(R), Share-Based Payment, using the modified
prospective method. SFAS 123(R) establishes standards for the accounting for transactions
in which an entity exchanges its equity instruments for goods or services and requires
that the compensation cost relating to share-based payment transactions be recognized in
financial statements, based on the fair value of the equity or liability instruments
issued, adjusted for estimated forfeitures.

The
Company accounts for options granted to consultants in accordance with Emerging Issues
Task Force (EITF) Issue 96-18, Accounting for Equity Instruments That Are Issued to
Other Than Employees for Acquiring, or in Conjunction with Selling, Goods or
Services, and SFAS 123(R).

The
Company determines the value of stock options utilizing the Black-Scholes option pricing
model. Compensation costs for share-based awards with pro rata vesting are allocated to
periods on a straight-line basis.

Income
Taxes  The Company and its subsidiary file consolidated federal and separate-company
state income tax returns. Income taxes are accounted for under the asset and liability
method. Deferred tax assets and liabilities are recognized for the future tax consequences
attributable to differences between the financial statement carrying amounts of assets and
liabilities and their respective tax basis and operating loss and tax credit
carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates
expected to apply to taxable income in the years in which those temporary differences or
operating loss and tax credit carryforwards are expected to be recovered or settled. The
effect on deferred tax assets and liabilities of a change in tax rates is recognized in
the period that includes the enactment date.

In
accordance with SFAS 109, Accounting for Income Taxes, the Company has
recorded a valuation allowance against its deferred tax assets. The valuation allowance is
based on managements estimates and analysis, which includes consideration of tax
laws that may limit the Companys ability to utilize its net operating loss
carryforwards.

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Net
Loss per Common Share  Basic earnings per share (EPS) is computed by dividing net
loss by the weighted average number of common shares outstanding for the period. Diluted
EPS reflects the potential dilution from the exercise or conversion of securities into
common stock, including stock options and warrants, restricted stock units and shares of
Series A Convertible Preferred Stock. As of September 30, 2008 and 2007, common shares
issuable upon conversion of Series A Convertible Preferred Stock, the vesting of
restricted stock units and the exercise of outstanding options and warrants amounted to an
aggregate of 15,754,226 and 16,266,314 shares, respectively, and were not included in the
computation of Diluted EPS because to do so would have been anti-dilutive for the periods
presented.

Recently
Issued Accounting Pronouncements  In September 2006, the Financial Accounting
Standards Board (FASB) issued SFAS 157, Fair Market Measurements. SFAS 157
clarifies the definition of fair value, establishes a framework for measuring fair value
and expands disclosure on fair value measurement. SFAS 157 is effective for financial
statements issued for fiscal years beginning after November 15, 2007 and interim periods
within those fiscal years; however, the FASB did provide a one-year deferral for the
implementation of SFAS 157 for certain non-financial assets and liabilities.

SFAS
157 establishes a valuation hierarchy for disclosure of the inputs to valuation used to
measure fair value. This hierarchy prioritizes the inputs into three broad levels. Level 1
inputs are quoted prices (unadjusted) in active markets for identical assets or
liabilities. Level 2 inputs include quoted prices for identical or similar assets and
liabilities that are not active, quoted prices for similar assets and liabilities in
active markets or inputs that are observable for the asset or liability, either directly
or indirectly through market corroboration, for substantially the full term of the
financial instrument. Level 3 inputs are unobservable inputs based on managements
own assumptions used to measure assets and liabilities at fair value. The classification
of a financial asset or liability within the hierarchy is determined based on the lowest
level input that is significant to the fair value measurement.

The
following table provides the assets and liabilities carried at fair value measured on a
recurring basis as of September 30, 2008:

|                               |                                                     |                                             |  |                                         |  |                                         |  |                                         | 
|------------------------------ | --------------------------------------------------- | ------------------------------------------- |  | --------------------------------------- |  | --------------------------------------- |  | --------------------------------------- | 
|                               | Fair value measurements at September 30, 2008 using
|                               |                                                     | Total carrying valueas ofSeptember 30, 2008 |  | Quoted prices inactive markets(Level 1) |  | Quoted prices inactive markets(Level 2) |  | Quoted prices inactive markets(Level 3) | 
|Available-for-sale-investments |                                                     | $      3,352,712                            |  | $      3,352,712                        |  | $               -                       |  | $               -                       | 

Available-for-sale-investments are
measured at fair value using quoted market prices and are classified within Level 1 of
the valuation hierarchy. The adoption of SFAS 157 did not have any impact on the Companys
consolidated results of operations and financial position.

In
February 2007, the FASB issued SFAS 159, The Fair Value Option for Financial Assets
and Financial Liabilities. SFAS 159 permits entities to measure many financial
instruments and certain other items at fair value at specified election dates. Under SFAS
159, any unrealized holding gains and losses on items for which the fair value option has
been elected are reported in earnings at each subsequent reporting date. If elected, the
fair value option (1) may be applied instrument by instrument, with a few exceptions, such
as investments otherwise accounted for by the equity method; (2) is irrevocable (unless a
new election date occurs); and (3) is applied only to entire instruments and not to
portions of instruments. SFAS 159 is effective as of an entitys first fiscal year
that begins after November 15, 2007. The adoption of SFAS 159 did not have a material
impact on the Companys consolidated results of operations and financial position.

In
June 2007, the FASB issued EITF Issue 07-3, Accounting for Nonrefundable Advance
Payments for Goods or Services Received for Use in Future Research and Development
Activities, which applies to companies involved in research and development
activities that make non-refundable advance payments for goods that will be used, or for
services that will be performed, in future research and development activities. EITF Issue
07-3 is effective for financial statements issued for fiscal years beginning after
December 15, 2007. The adoption of EITF Issue 07-3 did not have a material impact on the
Companys consolidated results of operations and financial position.

In
December 2007, the FASB issued EITF Issue 07-1, Accounting for Collaborative
Arrangements, which applies to collaborative arrangements that are conducted by the
participants without the creation of a separate legal entity for the arrangements and
clarifies, among other things, how to determine whether a collaborative agreement is
within the scope of this issue. EITF Issue 07-1 is effective for financial statements
issued for fiscal

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years beginning after December 15,
2008. The Company does not expect the adoption of EITF Issue 07-1 to have a material
impact on its consolidated results of operations and financial position.

(4)    COMPREHENSIVE
LOSS

Comprehensive
loss consists of the following:

|                                                         |  |  |                                  |            |   |   |          |  
|-------------------------------------------------------- |  |  | -------------------------------- | ---------- | - | - | -------- | -
|                                                         |  |  | Three Months Ended September 30,
|                                                         |  |  |                                  | 2008       |   |   | 2007     |  
|Net loss                                                 |  |  | $                                | (4,282,515 | ) | $ | (246,764 | )
|Unrealized gain (loss) on available-for-sale investments |  |  |                                  | (59        | ) |   | 15,814   |  
|Comprehensive loss                                       |  |  | $                                | (4,282,574 | ) | $ | (230,950 | )

(5)    INVESTMENTS

The following
is a summary of available-for-sale investments, which consist of mutual funds that invest
primarily in debt instruments:

|                 |  |  |   |                   |  |   |              | 
|---------------- |  |  | - | ----------------- |  | - | ------------ | 
|                 |  |  |   | September 30,2008 |  |   | June 30,2008 | 
|Cost             |  |  | $ | 3,323,654         |  | $ | 3,323,654    | 
|Unrealized gains |  |  |   | 29,058            |  |   | 29,117       | 
|Fair Value       |  |  | $ | 3,352,712         |  | $ | 3,352,771    | 

(6)    COMMITMENTS
AND CONTINGENCIES

Contingencies
 The Company accounts for litigation losses in accordance with SFAS 5,
Accounting for Contingencies. Under SFAS 5, loss contingency provisions are
recorded for probable losses when management is able to reasonably estimate the loss. Any
outcome upon settlement that deviates from the Companys best estimate may result in
additional expense or in a reduction in expense in a future accounting period. The Company
records legal expenses associated with such contingencies as incurred.

The
Company is subject to an inherent risk of product liability claims as a result of the
testing and marketing of its products. In December 2005, as a result of safety concerns
raised in connection with the use of NeutroSpec, the Company and Mallinckrodt suspended
NeutroSpec sales and marketing activities. If any claim is asserted based on the use of
NeutroSpec, the Company may incur future expenses or losses in connection with the related
litigation.

(7)    STOCKHOLDERS EQUITY

On
September 25, 2007, the Company issued grants of restricted stock units under the
Companys 2005 Stock Plan totaling in the aggregate 1,573,915 shares of common stock
as retention bonuses to its employees, other than the executive officers, that were not
affected by the September 2007 reduction in workforce. On September 30, 2008, after
adjusting for forfeitures and early vesting due to involuntary position elimination,
1,138,824 shares of common stock vested. The Company amortized the fair value of these
restricted stock units, totaling approximately $676,000, over the vesting period.
For the three-month period ended September 30, 2008, the Company
recognized approximately $133,000 of stock-based compensation expense related to these
restricted stock units.

Stock-based
compensation costs for the three months ended September 30, 2008 for stock options and
equity-based instruments issued other than the restricted stock units referenced above
totaled approximately $382,000.

9

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Item 2. Managements Discussion and
Analysis of Financial Condition and Results of Operations.

The
following discussion and analysis should be read in conjunction with the consolidated
financial statements and notes to the consolidated financial statements filed as part of
this report.

Statements
in this quarterly report on Form 10-Q, as well as oral statements that may be made by us
or by our officers, directors, or employees acting on our behalf, that are not historical
facts constitute forward-looking statements, which are made pursuant to the
safe harbor provisions of Section 21E of the Securities Exchange Act of 1934 as amended
(the Exchange Act). The forward-looking statements in this quarterly report on Form 10-Q
do not constitute guarantees of future performance. Investors are cautioned that
statements that are not strictly historical statements contained in this quarterly report
on Form 10-Q, including, without limitation, current or future financial performance,
managements plans and objectives for future operations, clinical trials and results,
product plans and performance, managements assessment of market factors, as well as
statements regarding our strategy and plans and our strategic partners, constitute
forward-looking statements. Such forward-looking statements involve known and unknown
risks, uncertainties and other factors that could cause our actual results to be
materially different from historical results or from any results expressed or implied by
such forward-looking statements. Our future operating results are subject to risks and
uncertainties and are dependent upon many factors, including, without limitation, the
risks identified in this report, in our annual report on Form 10-K for the year ended June
30, 2008 and in our other Securities and Exchange Commission (SEC) filings.

We
expect to incur losses in the future as a result of spending on our planned development
programs and losses may fluctuate significantly from quarter to quarter.

In
this quarterly report on Form 10-Q, references to we, our,
us or Palatin means Palatin Technologies, Inc.

Critical Accounting
Policies and Estimates

Our
significant accounting policies are described in the notes to our consolidated financial
statements included in this report and in our annual report on Form 10-K for the year
ended June 30, 2008, and have not changed as of September 30, 2008. We believe that our
accounting policies and estimates relating to revenue recognition, accrued expenses and
stock-based compensation are the most critical.

Overview

We
are a biopharmaceutical company dedicated to the development of peptide, peptide mimetic
and small molecule compounds with a focus on melanocortin and natriuretic peptide receptor
systems. We have a diverse pipeline of active development programs, including development
of proposed products in the cardiovascular field for treatment of heart failure,
hard-to-control hypertension and for cardiac surgery organ protection, and proposed
products for sexual dysfunction, obesity and metabolic syndrome. The melanocortin system
is involved in a large and diverse number of physiologic functions, and therapeutic agents
modulating this system may have the potential to treat a variety of conditions and
diseases, including sexual dysfunction, obesity and related disorders,
ischemiareperfusion injury (injury resulting from inadequate blood flow or
reintroduction of blood flow), hemorrhagic shock and inflammation-related diseases. The
natriuretic peptide receptor system has numerous cardiovascular functions, and therapeutic
agents modulating this system may be useful in treatment of heart failure, hypertension
and other cardiovascular diseases.

We
have the following products in development:

| |  |  | PL-3994,
a peptidomimetic natriuretic peptide receptor A (NPRA) agonist, for treatment of heart
failure (HF), including chronic HF and acute HF.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------

| |  |  | PL-3994
for treatment of difficult-to-control hypertension, including dialysis patients with
hypertension.
| | - |  | ----------------------------------------------------------------------------------------------------------

| |  |  | Bremelanotide,
a peptide melanocortin receptor agonist, for prevention of organ damage secondary to
cardiac surgery and related indications.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------

| |  |  | PL-6983,
a peptide melanocortin receptor agonist, for treatment of female sexual dysfunction (FSD).
| | - |  | ---------------------------------------------------------------------------------------------------

| |  |  | Melanocortin
receptor-based compounds for treatment of obesity and related metabolic syndrome pursuant
to an ongoing research collaboration and global license with AstraZeneca AB.
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  |  | NeutroSpec®,
a radiolabeled monoclonal antibody product for imaging and diagnosing infection, which is
the subject of a strategic collaboration agreement with the Mallinckrodt division of
Covidien Ltd. (Mallinckrodt). We have suspended ongoing clinical trials and regulatory
approvals of NeutroSpec while we and Mallinckrodt evaluate future development and
marketing activities involving NeutroSpec.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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Key
elements of our business strategy include: entering into alliances and partnerships with
pharmaceutical companies to facilitate the development, manufacture, marketing, sale and
distribution of product candidates we are developing; partially funding our development
and discovery programs with the cash flow from our collaboration agreements; and,
depending on the availability of sufficient funding, expanding our pipeline by using our
expertise in drug discovery technologies for melanocortin and natriuretic peptide receptor
systems and acquiring synergistic products and technologies.

We
incorporated in Delaware in 1986 and commenced operations in the biopharmaceutical area in
1996. Our corporate offices and research and development facility are located at 4C Cedar
Brook Drive, Cranbury, New Jersey 08512 and our telephone number is (609) 495-2200. We
maintain an Internet site at http://www.palatin.com, where among other things, we make
available free of charge on and through this website our Forms 3, 4 and 5, annual reports
on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments
to those reports filed or furnished pursuant to Section 13(a) or 15(d) and Section 16 of
the Exchange Act as soon as reasonably practicable after we electronically file such
material with, or furnish it to, the SEC. Our website and the information contained in it
or connected to it shall not be deemed to be incorporated into this quarterly report on
Form 10-Q.

Results of Operations

Three Months Ended September 30,
2008 Compared to the Three Months Ended September 30, 2007

Licenses
and Contracts  For the three months ended September
30, 2008, we recognized $0.8 million in licenses and contract revenue related to our
license agreement with AstraZeneca. For the three months ended September 30, 2007, we
recognized $9.0 million in licenses and contracts revenue, consisting of (i) $8.2 million,
related to bremelanotide for erectile dysfunction (ED) and FSD indications pursuant to our
collaboration agreement with King Pharmaceuticals, Inc. (King), (ii) $0.7 million related
to our license agreement with AstraZeneca, and (iii) $0.1 million related to NeutroSpec
pursuant to our collaboration agreement with Mallinckrodt.

There
was no revenue related to King in 2008 as a result of the termination of our collaboration
agreement with King and the recognition in September 2007 of the remaining deferred
license revenue pursuant to Kings up-front payment. License and contract revenue
from AstraZeneca for the three months ended September 30, 2008 consists of $0.3 million of
revenue related to our research services performed during said period and $0.4 million of
license revenue related to AstraZenecas up-front license fee. Contract revenue from
Mallinckrodt reflects Mallinckrodts share of the costs incurred in certain
NeutroSpec development activities. Future contract revenue from AstraZeneca and
Mallinckrodt, in the form of reimbursement of shared development costs or the recognition
of deferred license fees, will fluctuate based on development activities in our obesity
and NeutroSpec programs. We may also earn contract revenue based on the attainment of
certain development milestones.

Research
and Development  Research and development expenses decreased to $3.7 million for the
three months ended September 30, 2008 from $7.9 million for the three months ended
September 30, 2007.

Research
and development expenses related to bremelanotide for ED and FSD were $0 for the three
months ended September 30, 2008 compared to $2.5 million for the same period in 2007. The
amount for the three months ended September 30, 2007 included both third-party costs
incurred by us and partially reimbursed by King and our share of costs for development
activities performed by King. Research and development expenses related to bremelanotide
for ED and FSD changed as a result of (i) the completion of certain Phase 2B trials on
both men and women, and (ii) the decision to not initiate Phase 3 clinical trials for ED,
and (iii) the strategic restructuring and refocusing of our clinical-stage product
portfolio development programs. Similar to the recognition of license revenue explained
above, the three months ended September 30, 2007 includes the recognition of $0.8 million
of deferred costs based on the termination of our collaboration agreement with King.

Research
and development expenses related to our PL-3994, bremelanotide for prevention of organ
damage, PL-6983, obesity, NeutroSpec and other preclinical programs were $1.1 million for
the three months ended September 30, 2008 compared to $1.0 million for the three months
ended September 30, 2007. Spending to date has been primarily related to the
identification and optimization of lead compounds, and secondarily to preclinical studies
and a Phase 1 and a Phase 2a trial with PL-3994. The amount of such spending and the
nature of future development activities are dependant on a number of factors, including
primarily the availability of funds to support future development activities, success of
our clinical trials, preclinical and discovery programs, and our ability to progress
compounds in addition to PL-3994 into human clinical trials.

The
historical amounts of project spending above exclude general research and development
spending, which decreased to $2.6 million for the three months ended September 30, 2008
compared to $4.4 million for the

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three months ended September 30,
2007. The decrease is primarily related to the reductions in workforce initiated in
September 2007 and May 2008.

Cumulative
spending from inception to September 30, 2008 on our bremelanotide, NeutroSpec and other
programs (which includes PL-3994, PL-6983, obesity, and other discovery programs) amounts
to approximately $121.6 million, $55.4 million and $46.6 million, respectively. Due to
various risk factors described in our periodic filings with the SEC, including the
difficulty in currently estimating the costs and timing of future Phase 1 clinical trials
and large-scale Phase 2 and Phase 3 clinical trials for any product under development, we
cannot predict with reasonable certainty when, if ever, a program will advance to the next
stage of development or be successfully completed, or when, if ever, related net cash
inflows will be generated.

General
and Administrative  General and administrative expenses decreased to $1.5 million
for the three months ended September 30, 2008 compared to $1.7 million for the three
months ended September 30, 2007. The decrease is primarily related to the reductions in
workforce initiated in September 2007 and May 2008.

Liquidity and Capital Resources

Since
inception, we have incurred net operating losses, primarily related to spending on our
research and development programs. We have financed our net operating losses primarily
through equity financings and amounts received under collaborative agreements.

Our
product candidates are at various stages of development and will require significant
further research, development and testing and some may never be successfully developed or
commercialized. We may experience uncertainties, delays, difficulties and expenses
commonly experienced by early stage biopharmaceutical companies, which may include
unanticipated problems and additional costs relating to:

| |  | the
development and testing of products in animals and humans;
|- |  | --------------------------------------------------------------

| |  | product
approval or clearance;
|- |  | ------------------------------

| |  | regulatory
compliance;
|- |  | ----------------------

| |  | good
manufacturing practices;
|- |  | -----------------------------

| |  | intellectual
property rights;
|- |  | -----------------------------

| |  | product
introduction;
|- |  | ---------------------

| |  | marketing,
sales and competition; and
|- |  | -------------------------------------

| |  | obtaining
sufficient capital.
|- |  | -----------------------------

Failure
to obtain timely regulatory approval for our product candidates and indications would
impact our ability to generate revenues and could make it more difficult to attract
investment capital for funding our operations. Any of these possibilities could
materially and adversely affect our operations and require us to curtail or cease certain
programs.

During
the three months ended September 30, 2008, we used $4.6 million of cash for our operating
activities, compared to $7.0 million used in the three months ended September 30, 2007.
Lower net cash outflows from operations in the three months ended September 30, 2008
resulted primarily from lower operating expenses. Our periodic accounts receivable
balances will continue to be highly dependent on the timing of receipts from collaboration
partners and the division of development responsibilities between us and our collaboration
partners.

We
have incurred cumulative negative cash flows from operations since our inception, and
have expended, and expect to continue to expend in the future, substantial funds to
complete our planned product development efforts. As of September 30, 2008, our cash and
cash equivalents were $4.7 million and our available-for-sale investments were $3.4
million. This raises substantial doubt about our ability to continue as a going concern.
The accompanying consolidated financial statements have been prepared assuming that we
continue as a going concern.

We
intend to seek additional capital through public or private equity financings,
collaborative arrangements on our product candidates, milestone payments or other
sources. However, additional funding may not be available on acceptable terms or at all.
We anticipate receiving payments totaling $5 million from AstraZeneca by the end of the
first quarter of calendar year 2009, provided we achieve specified objectives by that
time. No assurance can be given that we will achieve the specified objectives by that
time or at all. We are also negotiating an extension of the collaboration portion of our
agreement with AstraZeneca, which if successfully concluded would result in support for
an increased number of Palatin employees.If adequate funds are not available, we will
further curtail operations significantly, including the delay, modification or
cancelation of product candidate development plans and further decreases in staffing
levels. We may also be required to seek collaborators for our product

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candidates at an earlier stage than
otherwise would be desirable and on terms that are less favorable than might otherwise be
available, and relinquish, license or otherwise dispose of rights on unfavorable terms to
technologies and product candidates that we would otherwise seek to develop or
commercialize ourselves.

The
nature and timing of our development activities are highly dependent on our financing
activities. No assurance can be given that we will earn future milestone payments that are
contingent on specified events or that we will not consume a significant amount of our
available resources before that time. We plan to continue to monitor the progress of our
development programs and the timing and amount of related expenditures and potential
milestone receipts, refine our operations, control expenses, evaluate alternative methods
to conduct our business and seek additional financing and sharing of development costs
through strategic collaboration agreements or other resources.

Future
capital requirements will also depend on the extent to which we acquire or invest in
businesses, products and technologies or sell or license our product candidates to others.
If we are successful in identifying a product or technology for an acquisition, we may
require substantial funds for such an acquisition and subsequent development or
commercialization. We do not know whether any acquisition will be consummated in the
future or whether we will be able to obtain additional funding if we identify such an
acquisition.

We
anticipate incurring additional losses over at least the next few years. To achieve
profitability, we, alone or with others, must successfully develop and commercialize our
technologies and proposed products, conduct preclinical studies and clinical trials,
obtain required regulatory approvals and successfully manufacture and market such
technologies and proposed products. The time required to reach profitability is highly
uncertain, and we do not know whether we will be able to achieve profitability on a
sustained basis, if at all.

Item 3. Quantitative and
Qualitative Disclosures About Market Risk.

Interest
Rate Risk. Our exposure to market risk from changes in interest rates relates primarily to
our cash, cash equivalents and available-for-sale investments (collectively referred to as
our investment portfolio). As of September 30, 2008, our cash and cash equivalents were
$4.7 million and investments, which consisted of mutual funds, were $3.4 million. Due to
the average maturity of our investment portfolio, we do not believe that short-term
fluctuations in interest rates would materially affect the value of it.

Item 4T. Controls and Procedures.

Our
management, with the participation of our Chief Executive Officer and Chief Financial
Officer, has evaluated the effectiveness of our disclosure controls and procedures, as
defined in Exchange Act Rules 13a-15(e) and 15d-15(e), 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 were effective. There were
no changes in our internal control over financial reporting that occurred during our most
recent fiscal quarter that materially affected, or that are reasonably likely to
materially affect, our internal control over financial reporting.

13

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PART II  OTHER
INFORMATION

Item 1. Legal Proceedings.

We
may be involved, from time to time, in various claims and legal proceedings arising in the
ordinary course of our business. We are not currently a party to any such claims or
proceedings that, if decided adversely to us, would either individually or in the
aggregate have a material adverse effect on our business, financial condition or results
of operations.

Item 1A. Risk Factors.

There
have been no material changes to our risk factors disclosed in Part I, Item 1A. of our
annual report on Form 10-K for the fiscal year ended June 30, 2008.

Item 2. Unregistered Sales of
Equity Securities and Use of Proceeds.

None.

Item 3. Defaults Upon Senior
Securities.

None.

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

None.

Item 5. Other Information.

None.

Item 6. Exhibits.

Exhibits
filed or furnished with this report:

| | 31.1 |  | Certification
of Chief Executive Officer. *
| | ---- |  | -------------------------------------------

| | 31.2 |  | Certification
of Chief Financial Officer. *
| | ---- |  | -------------------------------------------

| | 32.1 |  | Certification
by Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as added by Section 906 of
the Sarbanes-Oxley Act of 2002. *
| | ---- |  | -----------------------------------------------------------------------------------------------------------------------------------------

| | 32.2 |  | Certification
by Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as added by Section 906 of
the Sarbanes-Oxley Act of 2002. *
| | ---- |  | -----------------------------------------------------------------------------------------------------------------------------------------

_____________________________________* Exhibit filed with this report.

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SIGNATURES

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

|                        |  |                                                                                                                          | 
|----------------------- |  | ------------------------------------------------------------------------------------------------------------------------ | 
|                        |  | Palatin Technologies, Inc.(Registrant)                                                                                   | 
|                       
|                       
|Date: November 14, 2008 |  | /s/ Carl Spana                                                                                                           | 
|                        |  | Carl Spana, Ph.D.President andChief Executive Officer
        (PrincipalExecutive Officer)                               | 
|                       
|                       
|Date: November 14, 2008 |  | /s/ Stephen T. Wills                                                                                                     | 
|                        |  | Stephen T. WillsExecutive Vice President and
        Chief Financial Officer (PrincipalFinancial and Accounting Officer) | 

15

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EXHIBIT INDEX

| | 31.1 |  | Certification
of Chief Executive Officer. *
| | ---- |  | -------------------------------------------

| | 31.2 |  | Certification
of Chief Financial Officer. *
| | ---- |  | -------------------------------------------

| | 32.1 |  | Certification
by Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as added by Section 906 of
the Sarbanes-Oxley Act of 2002. *
| | ---- |  | -----------------------------------------------------------------------------------------------------------------------------------------

| | 32.2 |  | Certification
by Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as added by Section 906 of
the Sarbanes-Oxley Act of 2002. *
| | ---- |  | -----------------------------------------------------------------------------------------------------------------------------------------

_____________________________________* Exhibit filed with this report.