SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-QSB

(Mark One)

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

For the quarterly period ended:                               March 31, 1998

OR

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

For the transition period from        to

Commission file number:  0-24736

                   BioProgress Technology International, Inc.
        (Exact name of small business issuer as specified in its charter)

              Nevada                                    88-0361701   
  (State or other jurisdiction of                    (I.R.S. employer
  incorporation or organization)                  identification number)
                                           
 9055 Huntcliff Trace, Atlanta, Georgia                  30350-1735 
(Address of Principal executive offices)                 (Zip Code) 
                                                         

Registrant's telephone number, including area code:  (770) 641-0264

Indicate by check mark whether the issuer (1) has filed all reports  required to
be filed by Section 13 or 15(d) of the  Securities  Exchange  act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  registrant  was
required  to file  such  reports),  and  (2) has  been  subject  to such  filing
requirements for the past 90 days. Yes [X]  No

Indicate the number of shares  outstanding  of each of the  issuer's  classes of
common stock, as of the latest  practicable date: As of May 14, 1998, there were
approximately 4,999,753 shares outstanding.


<PAGE>

                        I. PART I - FINANCIAL INFORMATION

Item 1.  Financial Statements

                   BIOPROGRESS TECHNOLOGY INTERNATIONAL, INC.
                          (a development stage company)

                                 BALANCE SHEETS

                                                 March 31, 1998     December 31,
                                                    (unaudited)          1997
ASSETS
Current assets
         Cash                                           $500              $---
         Payments in advance                          96,994               ---

           Total current assets                       97,494               ---

Other assets
         Distributorship agreement                     4,000             4,000
         Inter-company                                     0           120,000

           Total other assets                          4,000           121,000

Total assets                                        $101,494          $124,000

LIABILITIES AND
STOCKHOLDERS' EQUITY:

Current Liabilities
         Accounts payable                              7,820               ---
         Inter-company                                 5,850               ---

           Total current liabilities:                 13,670               ---

Stockholders' equity (deficit)

Common stock, $001 par value,\
         10,000 shares authorized, 4,999,753
         outstanding
                                                       5,000              5,000
Additional paid-in capital                         4,313,065          4,313,065

Preferred stock, $.01 par value,
         1,000,000 shares authorized, none
         outstanding
Deficit accumulated during development stage      (4,230,242)        (4,309,065)

Total shareholders' equity (deficit)                  87,823            279,000

Less stock subscription receivable                    ------            155,000
Total Liabilities and Stockholders'
      Equity (Deficit)                               101,494            124,000


The accompanying notes form an integral part of these statements.


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                   BIOPROGRESS TECHNOLOGY INTERNATIONAL, INC.
                          (a development state company)

                            STATEMENTS OF OPERATIONS

                                                    Three months ended March 31,
                                                               (Unaudited)
                                                            1998          1997
Revenues                                                  $-------      $-------

Expenses

Legal                                                       7,500        ------

Audit and accountancy                                       5,000        ------

Administrative expenses                                   178,007        ------

Professional fees                                             870        ------

Total expenses                                            191,177        26,866

Income (loss) before provision for income taxes          (191,177)      (26,866)


Provisions for income taxes                                ------        ------

Net gain (loss)                                          (191,177)      (26,866)

Net gain (loss) per common share                                *       (26,866)

Weighted average shares 4,999,753 - 1998;
390,367 - 1997


* - Less than $.01 per share

The accompanying notes from an integral part
of these statements


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                   BIOPROGRESS TECHNOLOGY INTERNATIONAL, INC.
                          (a development stage company)

                            STATEMENTS OF CASH FLOWS


                                                    Three Months Ended March 31
                                                            (Unaudited)
                                                     1998               1997

Cash Flows Provided (Used) by
         Net Loss                                  $(191,177)        $(26,866)

Adjustments to  reconcile  net 
     gain  (loss) to net cash  provided
     by  operating activities:

         Increase in payments in advance             (96,993)            ---
         Decrease in inter-company
                  receivable                         120,000             ---
         Increase in inter-company
                  payable                              5,850             ---
         Increase in accounts payable                  7,820          26,866

Net cash flows provided (used) by
         operating activities                       (154,500)           ---

Cash Flows Provided by 
         Investing Activities:

         Stock subscription receivable               155,000            ---

Increase (Decrease) in cash:                             500            ---

Cash at beginning of the period:                         ---            ---

Cash at end of period:                                   ---            ---

The accompanying notes form an integral part of these statements.


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<PAGE>

                   BIOPROGRESS TECHNOLOGY INTERNATIONAL, INC.
                          (a development stage company)

                          Notes to Financial Statements
                                   (Unaudited)
In the opinion of management,  all adjustments  (consisting of normal  recurring
adjustments)  considered  necessary  for a fair  presentation  of the  financial
condition of registrant have been included,  and the disclosures are adequate to
make the information presented not misleading.

Note 1. A summary of significant  accounting  policies is currently on file with
the U.S. Securities and Exchange Commission in registrant's Form 10.

Note 2. The loss per share was  computed  by dividing  net loss by the  weighted
average number of shares of common stock outstanding during the period.

Note 3. Registrant has not declared or paid dividends on its common shares since
inception.

Note 4. The accompanying  unaudited  financial  statements have been prepared in
accordance  with  the  instructions  to  Form  10-QSB  and  do not  include  all
information and footnotes required by generally accepted  accounting  principles
for complete financial statements.

Note 5. Income taxes have not been provided for in that registrant has not had a
tax liability from inception to the date of these notes.

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

Results of Operations:

Registrant,  BioProgress  Technology  International,  Inc., a Nevada corporation
(the  "Company") had no operations or revenues during the first quarter of 1997.
On November 17, 1997, the Company entered into a  "Reorganization  Agreement" by
which it acquired its now sole wholly-owned subsidiary,  BioProgress Technology,
Inc., a Colorado corporation ("BioProgress Technology").

BioProgress  Technology  has entered into an "Exclusive  Distributor  Agreement"
with  BioProgress  Technology,  Limited,  an entity  incorporated  in the United
Kingdom (the  "Distributor").  The  Distributor  is engaged in the  development,
manufacture,  sale and  distribution  of materials and processes used to replace
gelatin in the manufacture of soft capsules.  BioProgress Technology, under this
agreement, has been granted the right to serve as the "Exclusive Distributor" of
the foregoing products in the United States and Canada.  BioProgress  Technology
has not yet  commenced  other than  start-up  operations  under the  Distributor
Agreement; thus, it had no revenues since November 17, 1997, to the date of this
report.


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<PAGE>

The Company's  expenses during the first quarter of 1997 were entirely  start-up
and  administrative  in nature,  and during  the first  quarter of 1998  related
entirely  to  placing  itself  into a  position  by which it  could  pursue  its
obligations  under the  Exclusive  Distributor  Agreement.  Thus,  no meaningful
comparison can be made between 1998 and 1997 since the Company had no operations
during this time and incurred only administrative expenses.

Liquidity and Capital Resources:

During the first quarter of 1997, the Company had no source of liquidity,  other
than the  largesse  of its former sole  director  and  executive  officer in his
extension  of credit.  In the last  quarter of 1997,  the Company  sold  435,000
shares of Common Stock under an option with a consultant at a price per share of
$.875, for aggregate  consideration of $385,000.  The Company then paid all past
due  obligations  with  these  monies,  and  continues  to use this  cash in the
development of its business.

                           PART II - OTHER INFORMATION

Item 1.  Litigation

No material  legal  proceedings to which the Company (or any officer or director
of the Company, or any affiliate or owner of record or beneficially of more than
five percent of the Common Stock,  to  management's  knowledge) is a party or to
which the  property of the  Company is subject is pending  and no such  material
proceeding is known by management of the Company to be contemplated.

Item 2.  Change in Securities

This item is not  applicable  to the  Company  for the  period  covered  by this
report.

Item 3.  Defaults Upon Senior Securities

This item is not  applicable  to the  Company  for the  period  covered  by this
report.

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

There were no  meetings of security  holders  during the period  covered by this
report; thus, this item is not applicable.

Item 5.  Other Information



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There is no additional information which the Company is electing to report under
this item at this time.

Item 6.  Exhibits and Reports on Form 8-K

This item is not  applicable  to the  Company  for the  period  covered  by this
report.

                                   SIGNATURES

Pursuant to the  requirements of Section 13 or 15(d) 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 this 15th day of May, 1998.

BIOPROGRESS TECHNOLOGY INTERNATIONAL, INC.
(Registrant)

By:  /s/ Barry J. Muncaster
     ----------------------
Barry J. Muncaster, President
  and Chief Executive Officer


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