|   |                                                                          |   |                                      |
|--------|-------------------------------------------------------------------------------|--------|-------------------------------------------|
|   | Nevada                                                                        |   | 20-0854033                                |
|   | (State      or other jurisdiction of incorporation      or organization) |   | (I.R.S.      Employer Identification No.) |
|   |                                                                          |   |                                      |
|   | 3      Sapir Street, Weizmann Science      Park                               |   |                                      |
|   | Nes-Ziona,      Israel                                                        |   | 74140                                     |
|   | (Address      of principal executive offices)                                 |   | (Zip      Code)                           |

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

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|                                             |                                                                                                  | Page   |
|--------------------------------------------------|-------------------------------------------------------------------------------------------------------|--------|
|                                             |                                                                                                  |   |
| Part I                                           |                                                                                                  |   |
|                                             |                                                                                                  |   |
| Item      1.                                     | Financial      Statements                                                                             | 3      |
|                                             |                                                                                                  |   |
| Item      2.                                     | Management’s      Discussion and Analysis of Financial Condition and Results of      Operations | 8      |
|                                             |                                                                                                  |   |
| Item      3.                                     | Quantitative      and Qualitative Disclosures About Market Risk                                       | 15     |
|                                             |                                                                                                  |   |
| Item      4T.  Controls and Procedures | 15                                                                                                    |
|                                             |                                                                                                  |   |
| Part II                                          |                                                                                                  |   |
|                                             |                                                                                                  |   |
| Item      1.                                     | Legal      Proceedings                                                                                | 16     |
|                                             |                                                                                                  |   |
| Item      1A.                                    | Risk      Factors                                                                                     | 16     |
|                                             |                                                                                                  |   |
| Item      2.                                     | Unregistered      Sales of Equity Securities and Use of Proceeds                                      | 16     |
|                                             |                                                                                                  |   |
| Item      3.                                     | Defaults      upon Senior Securities                                                                  | 16     |
|                                             |                                                                                                  |   |
| Item      4.                                     | Submission      of Matter to a Vote of Security Holders                                               | 16     |
|                                             |                                                                                                  |   |
| Item      5.                                     | Other      Information                                                                                | 16     |
|                                             |                                                                                                  |   |
| Item      6.                                     | Exhibits                                                                                              | 16     |
|                                             |                                                                                                  |   |
| Signatures                                       |                                                                                                  | 17     |
|                                             |                                                                                                  |   |
| Certifications                                   |                                                                                                  |   |

----

| ITEM      1. | Financial      Statements. |
|--------------|----------------------------|

|                                                                                                                                                                                         |   | March 31, |        |   | December 31, |   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|----------------|-------------|--------|-------------------|--------|
|                                                                                                                                                                                         |   | 2009           |        |   | 2008              |   |
| ASSETS                                                                                                                                                                                       |   | (Unaudited)    |        |   |              |   |
| Current      Assets:                                                                                                                                                                         |   |           |        |   |              |   |
| Cash      and cash equivalents                                                                                                                                                               |   | $              | 5,555,044   |   |              | $      | 7,465,232 |   |
| Accounts      receivable and prepaid expenses                                                                                                                                                |   |           | 382,858     |   |              |   | 412,515 |   |
| Restricted      cash                                                                                                                                                                         |   |           | 82,684      |   |              |   | 91,078 |   |
| Total      current assets                                                                                                                                                                    |   |           | 6,020,586   |   |              |   | 7,968,825 |   |
| Property      and equipment, net                                                                                                                                                             |   |           | 291,087     |   |              |   | 310,173 |   |
| Long-term      Assets:                                                                                                                                                                       |   |           |        |   |              |   |   |   |
| Severance      pay fund                                                                                                                                                                      |   |           | 74,465      |   |              |   | 73,775 |   |
| Long      term deposit                                                                                                                                                                       |   |           | 1,719       |   |              |   | 1,894 |   |
| Total      long term assets                                                                                                                                                                  |   |           | 76,184      |   |              |   | 75,669 |   |
| Total      assets                                                                                                                                                                            |   | $              | 6,387,857   |   |              | $      | 8,354,667 |   |
|  LIABILITIES      AND SHAREHOLDERS' EQUITY                                                                                                                                              |   |           |        |   |              |   |   |   |
| Current      Liabilities:                                                                                                                                                                    |   |           |        |   |              |   |   |   |
| Trade      payables                                                                                                                                                                          |   | $              | 152,424     |   |              | $      | 156,039 |   |
| Related      party  payables                                                                                                                                                       |   |           | 41,902      |   |              |   | 51,374 |   |
| Accrued      expenses and other liabilities                                                                                                                                                  |   |           | 1,118,761   |   |              |   | 188,660 |   |
| Total      current liabilities                                                                                                                                                               |   |           | 1,313,087   |   |              |   | 396,073 |   |
| Accrued      severance pay                                                                                                                                                                   |   |           | 89,107      |   |              |   | 90,732 |   |
| Commitments      and contingent liabilities                                                                                                                                                  |   |           |        |   |              |   |   |   |
| Shareholders'      equity:                                                                                                                                                                   |   |           |        |   |              |   |   |   |
| Stock      capital -                                                                                                                                                                         |   |           |        |   |              |   |   |   |
| Preferred      stock of $ 0.00001 par value –10,000,000      shares of preferred stock authorized, 800,000 issued and      outstanding                                                 |   |           | 8           |   |              |   | 8 |   |
| Common      stock of $ 0.00001 par value –300,000,000      shares of common stock authorized; 35,549,028 shares issued and      outstanding as of March 31, 2009 and December 31, 2008 |   |           | 355         |   |              |   | 355 |   |
| Additional      paid-in capital                                                                                                                                                              |   |           | 27,644,285  |   |              |   | 27,407,606 |   |
| (Deficit)      accumulated during the development stage                                                                                                                                      |   |           | (22,658,985 | )      |              |   | (19,540,107 | ) |
| Total      shareholders' equity                                                                                                                                                              |   |           | 4,985,663   |   |              |   | 7,867,862 |   |
| Total      liabilities and shareholders' equity                                                                                                                                              |   | $              | 6,387,857   |   |              | $      | 8,354,667 |   |

----

|                                               |   |                                           |       |   | Period from              |   |
|----------------------------------------------------|--------|------------------------------------------------|------------|--------|-------------------------------|--------|
|                                               |   |                                           |       |   | May 31, 2005        |   |
|                                               |   | For the three months ended |       |   | (date of inception) |   |
|                                               |   | March 31,                                 |       |   | to March 31,        |   |
|                                               |   | 2009                                           |       |   | 2008                          |   |   | 2009 |   |
|                                               |   |                                           |       |   |                          |   |   |   |   |
| Revenues                                           |   | $                                              | -          |   |                          | $      | - |   |   | $ | - |   |
|                                               |   |                                           |       |   |                          |   |   |   |   |   |   |   |
| Operating      expenses:                           |   |                                           |       |   |                          |   |   |   |   |   |   |   |
|                                               |   |                                           |       |   |                          |   |   |   |   |   |   |   |
| In-process      research and development write-off |   |                                           |       |   |                          |   | - |   |   |   | 3,222,831 |   |
| Research      and development, net                 |   |                                           | 2,585,702  |   |                          |   | 740,510 |   |   |   | 10,131,137 |   |
| General      and administrative                    |   |                                           | 478,734    |   |                          |   | 608,802 |   |   |   | 9,796,308 |   |
| Total      operating expenses                      |   |                                           | 3,064,436  |   |                          |   | 1,349,312 |   |   |   | 23,150,276 |   |
|                                               |   |                                           |       |   |                          |   |   |   |   |   |   |   |
| Operating      (loss)                              |   |                                           | (3,064,436 | )      |                          |   | (1,349,312 | ) |   |   | (23,150,276 | ) |
|                                               |   |                                           |       |   |                          |   |   |   |   |   |   |   |
| Financial      income                              |   |                                           | 30,191     |   |                          |   | 235,659 |   |   |   | 871,878 |   |
| Financial      (expenses)                          |   |                                           | (84,633    | )      |                          |   | ( 578 | ) |   |   | (380,587 | ) |
| Net      (loss)                                    |   | $                                              | (3,118,878 | )      |                          | $      | (1,114,231 | ) |   | $ | (22,658,985 | ) |
|                                               |   |                                           |       |   |                          |   |   |   |   |   |   |   |
| (Loss)      per share (basic & diluted)        |   | $                                              | (0.09      | )      |                          | $      | ( 0.03 | ) |   | $ | (0.93 | ) |
|                                               |   |                                           |       |   |                          |   |   |   |   |   |   |   |
| Weighted      average number of shares outstanding |   |                                           | 35,549,028 |   |                          |   | 35,473,187 |   |   |   | 24,399,702 |   |

----

|                                                          |   |                                           |       |   |                          |   |           | Period from       |   |
|---------------------------------------------------------------|--------|------------------------------------------------|------------|--------|-------------------------------|--------|----------------|------------------------|--------|
|                                                          |   |                                           |       |   |                          |   |           | May 31, 2005 |   |
|                                                          |   | For the three months ended |       |   | (date of inception) |   |
|                                                          |   | March 31,                                 |       |   | to March 31,        |   |
|                                                          |   | 2009                                           |       |   | 2008                          |   |           | 2009                   |   |
|                                                          |   |                                           |       |   |                          |   |           |                   |   |
| Cash flows from operating      activities                     |   |                                           |       |   |                          |   |           |                   |   |
| Net      cash (used in) operating activities                  |   | $                                              | (1,918,757 | )      |                          | $      | ( 522,404 | )                      |   | $ | (11,778,484 | ) |
|                                                          |   |                                           |       |   |                          |   |           |                   |   |   |   |   |
| Cash flows from investing      activities                     |   |                                           |       |   |                          |   |           |                   |   |   |   |   |
| Purchase      of property and equipment                       |   |                                           | -          |   |                          |   | ( 69,720  | )                      |   |   | (416,250 | ) |
| Payment      for the acquisition of ModigeneTech Ltd.         |   |                                           | -          |   |                          |   | -              |                   |   |   | (474,837 | ) |
| Long      term deposit                                        |   |                                           | 175        |   |                          |   | -              |                   |   |   | (1,719 | ) |
| Restricted      cash                                          |   |                                           | 8,394      |   |                          |   | ( 31,780  | )                      |   |   | (82,684 | ) |
| Net      cash provided by (used in) investing activities      |   |                                           | 8,569      |   |                          |   | ( 101,500 | )                      |   |   | (975,490 | ) |
|                                                          |   |                                           |       |   |                          |   |           |                   |   |   |   |   |
| Cash flows from financing      activities                     |   |                                           |       |   |                          |   |           |                   |   |   |   |   |
| Short      term bank credit                                   |   |                                           | -          |   |                          |   | ( 1,886   | )                      |   |   | (2,841 | ) |
| Proceeds      from loans                                      |   |                                           | -          |   |                          |   | -              |                   |   |   | (173,000 | ) |
| Principal      payment of loans                               |   |                                           | -          |   |                          |   | -              |                   |   |   | 173,000 |   |
| Proceeds      from issuance of shares                         |   |                                           | -          |   |                          |   | 2,000,000      |                   |   |   | 18,311,859 |   |
| Net      cash provided by (used in) financing activities      |   |                                           | -          |   |                          |   | 1,998,114      |                   |   |   | 18,309,018 |   |
| (Decrease)      increase in cash and cash equivalents         |   |                                           | (1,910,188 | )      |                          |   | 1,374,210      |                   |   |   | 5,555,044 |   |
| Cash      and cash equivalents at the beginning of the period |   |                                           | 7,465,232  |   |                          |   | 11,455,807     |                   |   |   | - |   |
| Cash      and cash equivalents at the end of the period       |   | $                                              | 5,555,044  |   |                          | $      | 12,830,017     |                   |   | $ | 5,555,044 |   |
|                                                          |   |                                           |       |   |                          |   |           |                   |   |   |   |   |
| Cash      paid for income taxes                               |   | $                                              | -          |   |                          | $      | -              |                   |   | $ | - |   |
| Cash      paid for interest expense                           |   | $                                              | 22         |   |                          | $      | 578            |                   |   | $ | 295,991 |   |

----

| NOTE      1:- | GENERAL                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
|---------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
|          | Modigene      Inc. ("the Company") was formed on August 22, 2003 under the laws of the      state of Nevada.  The Company is engaged in the development of      therapeutic proteins with extended half-lifes, through its subsidiary,      ModigeneTech Ltd. (“ModigeneTech”).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |
|          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
|          | The      Company is devoting substantially all of its efforts toward conducting      research and development activities. The Company’s activities also include      raising capital, recruiting personnel and building infrastructure. In the      course of such activities, the Company has sustained operating losses and      expects such losses to continue for the foreseeable future. The Company      has not generated any revenues or product sales and has not achieved      profitable operations or positive cash flow from operations. The Company’s      deficit accumulated during the development stage aggregated $22,658,985      through March 31, 2009. There is no assurance that profitable operations,      if ever achieved, could be sustained on a continuing basis. The Company      believes that its current cash sources will enable the continuance of the      Company's activities for at least a year with no need of additional      financing. |
|          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |
| NOTE      2:- | SIGNIFICANT      ACCOUNTING POLICIES                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
|          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
|          | a.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | Basis      of presentation: |
|          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |
|          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | The      accompanying unaudited financial statements of the Company are presented      in accordance with the requirements for Form 10-Q and Article 10 of      Regulation S-X. Certain information and footnote disclosures normally      included in financial statements prepared in accordance with accounting      principles generally accepted in the United States of America ("US GAAP")      have been condensed or omitted pursuant to United States Securities and      Exchange Commission (“SEC”)  rules and regulations. In the      opinion of management, all adjustments (consisting of normal recurring      adjustments) considered necessary for a fair presentation have been made.      The results for these interim periods are not necessarily indicative of      the results for the entire year. The accompanying financial statements      should be read in conjunction with the December 31, 2008 financial      statements and the notes thereto included in the Company's Report on Form      10-K filed March 16, 2009. |
|          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |
|          | b.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | Principles      of consolidation: |
|          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |
|          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | The      consolidated financial statements include the accounts of the Company and      its wholly-owned subsidiaries Modigene Inc., a Delaware corporation      (“Modigene Delaware”), and ModigeneTech. Intercompany transactions and      balances have been eliminated upon consolidation. |
|          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |
|          | c.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | Loss      per share: |
|          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |
|          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | Basic      and diluted losses per share are presented in accordance with FASB issued      SFAS No. 128 "Earnings per share" ("SFAS 128").Outstanding      share options and warrants have been excluded from the calculation of the      diluted loss per share because all such securities are antidilutive.      Securities excluded from the calculation for the three months periods      ended March 31, 2009 and 2008 and for the period from May 31, 2005 (date      of inception) to March 31, 2009 were 9,018,909, 6,634,524 and 4,675,467,      respectively. |

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| NOTE      3:- | SHAREHOLDERS'      EQUITY                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
|---------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
|          | Option      plans:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
|          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
|          | The      Company issued stock options to purchase shares of common stock under its      2005 Stock Incentive Plan (the “2005 Plan”) and under its 2007 Equity      Incentive Plan (the “2007 Plan”). The Company accounts for stock based      compensation using the fair value recognition provisions of SFAS No. 123R      (revised 2004), “Share Based Payment.” The fair value of each stock option      is estimated based upon grant date fair value using the Black-Scholes      option-pricing model.The      following weighted average assumptions were used for the options granted      during the year 2009: (i) annual dividends of $0.00, (ii) expected      volatility of 116.72%, (iii) risk-free interest rate of 0.51%, and (iv)      expected average option lives of 5 years. |
|          | The      following is a summary of the stock options granted under the 2005 and      2007 Plans:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |

|                                            |   | March 31, 2009 |         |
|-------------------------------------------------|--------|--------------------------|--------------|
|                                            |   | Numberof Options    |         |   | Weighted AverageExercise Price |   |
|                                            |   |                     |         |   |   |   |
| Outstanding      at the beginning of the period |   |                     | 4,432,292    |   |   | $ | 1.14 |   |
| Issued      under the 2005 plan                 |   |                     | 175,500      |   |   | $ | 0.65 |   |
| Issued      under the 2007 plan                 |   |                     | 200,000      |   |   | $ | 0.65 |   |
| Forfeited                                       |   |                     | ( 2,353 | ) |   | $ | 1.49 |   |
| Outstanding      at the end of the period       |   |                     | 4,805,439    |   |   | $ | 1.10 |   |
|                                            |   |                     |         |   |   |   |   |   |
| Options      exercisable                        |   |                     | 2,538,522    |   |   | $ | 1.14 |   |

|  |   | The      options outstanding as of March 31, 2009, have been separated into      exercise prices, as follows: |
|--|--------|---------------------------------------------------------------------------------------------------------------|

|                |   |                     |      |   | Remaining Weightedaverage contractual life |   |   |                     |   |
|---------------------|--------|--------------------------|-----------|--------|-----------------------------------------------------------|--------|--------|--------------------------|--------|
| Exercise Price |   | Options Outstanding |      |   | (years)                                                   |   |   | Options Exercisable |   |
|                |   |                     |      |   |                                                      |   |   |                     |   |
| $  0.65   |   |                     | 375,500   |   |                                                      |   | 9.85   |                     |   |   | 0 |   |
| $  0.879  |   |                     | 1,265,474 |   |                                                      |   | 6.97   |                     |   |   | 1,265,474 |   |
| $  0.90   |   |                     | 1,950,000 |   |                                                      |   | 8.92   |                     |   |   | 487,500 |   |
| $  0.93   |   |                     | 25,000    |   |                                                      |   | 8.93   |                     |   |   | 6,250 |   |
| $  1.32   |   |                     | 435,146   |   |                                                      |   | 3.92   |                     |   |   | 435,146 |   |
| $  1.50   |   |                     | 130,500   |   |                                                      |   | 9.07   |                     |   |   | - |   |
| $  2.00   |   |                     | 475,000   |   |                                                      |   | 8.11   |                     |   |   | 208,333 |   |
| $  2.50   |   |                     | 148,819   |   |                                                      |   | 4.01   |                     |   |   | 135,819 |   |
|                |   |                     | 4,805,439 |   |                                                      |   | 7.80   |                     |   |   | 2,538,522 |   |

|          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | The      weighted average fair value at grant date of options outstanding as of      March 31, 2009 was $0.71.                                                                                                                                                                                                                                                                                                                                                                                                |
|---------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | Stock      based compensation expense for the three months ended March 31, 2009 and      2008 and for the period from May 31, 2005 (date of inception) through      March 31, 2009 were $236,679, $235,524 and $6,704,123, respectively. Stock      based compensation for the period from May 31, 2005 (date of inception)      through March 31, 2009 includes stock based payment in the acquisition of      a subsidiary and deferred compensation on restricted shares in the amount      of $3,876,960. |
|          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
| NOTE      4:- | EXTENSION      OF LINE OF CREDIT                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
|          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
|          | On March 25, 2008, the Company      entered into a Credit Agreement with a group of investors. Under this line      of credit, the Company may, at its discretion, borrow up to $10,000,000,      which proceeds may be used for working capital or general corporate      purposes of the Company, as approved by Company's board of directors (the      “Board”). The maturity date for the line of credit is March 25, 2009,      unless (i) the Company has borrowed any funds under the line of credit      prior to March 25, 2009, or (ii) the Company elects to extend the line of      credit. In either of such events the maturity date will be extended until      March 25, 2013. Upon the maturity date, as the same may be extended, the      Company is obligated to repay all outstanding borrowings, together with      any accrued interest, and the line of credit will terminate. The Company      is obligated to pay interest on outstanding borrowings under the line of      credit at a 10% annual rate. In the event the Company determines to draw      on the line of credit, or the Company elects to extend the maturity date      until March 25, 2013, the Company will issue the Investors five-year      warrants to purchase an aggregate of 1,500,000 shares of the Company’s      non-registered Common stock, having an exercise price of $0.99 per      share.  In March 2009, the lending shareholders agreed to grant      the Company until April 30, 2009 to elect whether to extend the line of      credit. |

----

| ITEM      2. | Management’s      Discussion and Analysis of Financial Condition and Results of      Operations. |
|--------------|--------------------------------------------------------------------------------------------------------|

----

|                                    |   | %      |   |
|-----------------------------------------|--------|--------|--------|
|                                    |   |   |   |
| Office      furniture and equipment     |   |   | 6      |   |
|                                    |   |   |   |   |
| Laboratory      equipment               |   |   | 15     |   |
|                                    |   |   |   |   |
| Computers      and electronic equipment |   |   | 33     |   |
|                                    |   |   |   |   |
| Leasehold      improvements             |   |   | 25     |   |

----

|  | · | internal      costs associated with research and development  activities; |
|--|--------|---------------------------------------------------------------------------|

|  | · | payments      made to third party contract research organizations, contract      manufacturers, investigative sites, and  consultants; |
|--|--------|----------------------------------------------------------------------------------------------------------------------------------------|

|  | · | manufacturing      development costs; |
|--|--------|---------------------------------------|

|  | · | personnel-related      expenses, including salaries, benefits, travel, and related costs for the      personnel involved in the research and  development; |
|--|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | · | activities      relating to the advancement of product candidates through preclinical      studies and clinical trials; and |
|--|--------|-----------------------------------------------------------------------------------------------------------------------------|

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|  | · | facilities      and other expenses, which include expenses for rent and maintenance of      facilities, as well as laboratory and other  supplies. |
|--|--------|----------------------------------------------------------------------------------------------------------------------------------------------------|

|  | · | completion      of such preclinical and clinicaltrials; |
|--|--------|---------------------------------------------------------|

|  | · | receipt of necessary regulatory    approvals; |
|--|--------|-----------------------------------------------|

|  | · | the      number of clinical sites included in thetrials; |
|--|--------|----------------------------------------------------------|

|  | · | the      length of time required to enroll suitable  patients; |
|--|--------|----------------------------------------------------------------|

|  | · | the      number of patients that ultimately participate in the    trials; |
|--|--------|---------------------------------------------------------------------------|

|  | · | adverse      medical events or side effects in treated  patients; |
|--|--------|-------------------------------------------------------------------|

|  | · | lack      of comparability with complementary  technologies; |
|--|--------|--------------------------------------------------------------|

|  | · | obtaining      capital necessary to fund operations, including the research and      development efforts; and |
|--|--------|---------------------------------------------------------------------------------------------------------------|

|  | · | the      results of clinical trials. |
|--|--------|--------------------------------------|

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|  | · | interest      earned on the Company’s cash and cash  equivalents; |
|--|--------|-------------------------------------------------------------------------|

|  | · | interest      expense on short term bank credit and loan;and |
|--|--------|--------------------------------------------------------------|

|  | · | expense      or income resulting from fluctuations of the New Israeli Shekel, which a      portion of the Company’s assets and liabilities are denominated in,      against the United States Dollar and other foreign    currencies. |
|--|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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.

 candidates,we are unable to estimate the amounts of increased capital outlays and operatingexpenditures associated with our current and anticipated clinical trials. Ourfuture capital requirements will depend on many factors, including the progressand results of our clinical trials, the duration and cost of discovery andpreclinical development, and laboratory testing and clinical trials for ourproduct candidates, the timing and outcome of regulatory review of our productcandidates, the number and development requirements of other product candidatesthat we pursue, and the costs of commercialization activities, including productmarketing, sales, and distribution. We do not anticipate that we will generateproduct revenues for at least the next several years. In the absence ofadditional funding, we expect continuing operating losses to result in increasesin our cash used in operations over the next several years. To the extent thatour capital resources are insufficient to meet our future capital requirements,we will need to finance our future cash needs through public or private equityofferings, debt financings, or corporate collaboration and licensingarrangements. We currently do not have any commitments for future externalfunding. We may need to raise additional funds more quickly if one or more ofour assumptions proves to be incorrect or if we choose to expand our productdevelopment efforts more rapidly than we presently anticipate, and we may decideto raise additional funds even before we need them if the conditions for raisingcapital are favorable. We may seek to sell additional equity or debt securitiesor obtain a bank credit facility. The sale of additional equity or debtsecurities may result in dilution to our shareholders. The incurrence ofindebtedness would result in increased fixed obligations and could also resultin covenants that would restrict our operations. Additional equity or debtfinancing, grants, or corporate collaboration and licensing arrangements may notbe available on acceptable terms, if at all. If adequate funds are notavailable, we may be required to delay, reduce the scope of or eliminate ourresearch and development programs, reduce our planned commercialization effortsor obtain funds through arrangements with collaborators or others that mayrequire us to relinquish rights to certain product candidates that we mightotherwise seek to develop or commercialize independently.

Arrangements

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| ITEM      3. | Quantitative      and Qualitative Disclosures About MarketRisk |
|--------------|----------------------------------------------------------------|

| ITEM      4T. | Controls      and Procedures. |
|---------------|-------------------------------|

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|                                                                                                              | MODIGENE      INC.           |   |
|-------------------------------------------------------------------------------------------------------------------|------------------------------|--------|
|                                                                                                              |                         |   |
| May 14,      2009                 |  /s/ Abraham Havron     |   |
| Date                                                                                                              | Abraham      Havron          |   |
|                                                                                                              | Chief      Executive Officer |   |

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