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                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-K

                  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended                        Commission File Number 1-14798
    December 31, 2001

                            IVAX DIAGNOSTICS, INC.
             (Exact name of registrant as specified in its charter)

        Delaware                                             11-3500746
(State or other jurisdiction of                           (I.R.S. Employer
incorporation or organization)                           Identification No.)

                  2140 North Miami Avenue, Miami, Florida 33127
          (Address of principal executive offices, including zip code)

                                 (305) 324-2300
              (Registrant's telephone number, including area code)

           Securities Registered Pursuant to Section 12(b) of the Act:

       Common Stock,                                  American Stock Exchange
       Par Value $0.01                                 Boston Stock Exchange
      (Title of class)                                (Name of each exchange
                                                        on which registered)

        Securities Registered Pursuant to Section 12(g) of the Act: None

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

         Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K ((S)229.405 of this chapter) is not contained herein,
and will not be contained, to the best of registrant's knowledge, in definitive
proxy or information statements incorporated by reference in Part III of this
Form 10-K or any amendment to this Form 10-K. [ ]

         The aggregate market value of the voting common stock held by
non-affiliates of the registrant on March 20, 2002, was approximately
$25,906,956 million.

         As of March 20, 2002, there were 28,635,652 shares of common stock
outstanding.

                  Documents Incorporated by Reference: None
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                              IVAX DIAGNOSTICS, INC.

                           Annual Report on Form 10-K
                      for the year ended December 31, 2001

                                TABLE OF CONTENTS
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                                    PART I

Item 1.    Business..................................................         1
Item 2.    Properties................................................         8
Item 3.    Legal Proceedings.........................................         8
Item 4.    Submission of Matters to a Vote of Security Holders.......         8

                                    PART II

Item 5.    Market for Registrant's Common Equity and Related
           Stockholder Matters.......................................         9
Item 6.    Selected Financial Data...................................        10
Item 7.    Management's Discussion and Analysis of Financial
           Condition and Results of Operations.......................        10
Item 7A.   Quantitative and Qualitative Disclosures About
           Market Risk...............................................        20
Item 8.    Financial Statements and Supplementary Data...............        21
Item 9.    Changes in and Disagreements with Accountants on
           Accounting and Financial Disclosure.......................        46

                                   PART III

Item 10.   Directors and Executive Officers of the Registrant........        46
Item 11.   Executive Compensation....................................        49
Item 12.   Security Ownership of Certain Beneficial Owners
           and Management............................................        51
Item 13.   Certain Relationships and Related Transactions............        53

                                    PART IV

Item 14.   Exhibits, Financial Statement Schedules and Reports on
           Form 8-K..................................................        54
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                                      ii
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                                     PART I

ITEM 1.    BUSINESS

CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS

         We have made forward-looking statements, which are subject to risks and
uncertainties, in this annual report on Form 10-K. These statements are based on
the beliefs and assumptions of our management and on the information currently
available to it. Forward-looking statements may be preceded by, followed by, or
otherwise include the words "believes," "expects," "anticipates," "intends,"
"plans," "estimates," "projects," "would," "should," or similar expressions or
statements that certain events or conditions "may" occur. Actual results,
performance or achievements could differ materially from those contemplated,
expressed or implied by these forward-looking statements. These forward-looking
statements are based largely on our expectations and the beliefs and assumptions
of our management and on the information currently available to it and are
subject to a number of risks and uncertainties, including, but not limited to,
the risks and uncertainties associated with: economic, competitive, political,
governmental and other factors affecting us and our operations, markets and
products; the success of technological, strategic and business initiatives; our
limited operating revenues and history of operational losses; our agreements
with IVAX Corporation, or IVAX, third party distributors and key personnel;
consolidation of our customers and reimbursement policies of governmental and
private third parties affecting our operations, markets and products; price
constraints imposed by our customers, governmental and private third parties;
our reliance on our largest customer; our ability to consummate potential
acquisitions of businesses or products including the proposed acquisition
described below, and if that acquisition is not consummated that we may have no
remedies available against our largest customer under the agreements we have
with them; our ability to integrate acquired businesses or products; political
and economic instability and foreign currency fluctuation affecting our foreign
operations; the holding of substantially all of our cash and cash equivalents at
a single brokerage firm, including risks relating to the bankruptcy or
insolvency of such brokerage firm; litigation regarding intellectual property
rights and product liability; voting control of our common stock by IVAX;
conflicts of interest with IVAX and with our officers, directors and employees;
and other factors discussed elsewhere in this annual report on Form 10-K. Many
of these factors are beyond our control.

BUSINESS

         General. We are the parent corporation of the following three
subsidiaries:

                . Delta Biologicals, S.r.l.;

                . Diamedix Corporation; and

                . ImmunoVision, Inc.

         Through these subsidiaries, we develop, manufacture, and market
diagnostic test kits, or assays, that are used to aid in the detection of
disease markers primarily in the areas of autoimmune and infectious diseases.
These tests, which are designed to aid in the identification of the causes of
illness and disease, assist physicians in selecting appropriate patient
treatment. Most of our tests are based on Enzyme Linked ImmunoSorbent Assay, or
ELISA, technology, a clinical testing methodology used worldwide. Specific tests
are prepared using a 96 well
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microplate format whereby specific antigens are typically coated on the wells of
a microplate during the manufacturing process. A test using ELISA technology
involves a series of reagent additions to the microplate causing a reaction that
results in a visible color in the wells. The amount of color is directly
proportionate to the amount of the specific analyte in the patient sample. Our
kits are designed to be performed either manually or in an automated format. In
addition to our line of diagnostic kits, we also design and manufacture
laboratory instruments that perform the tests and provide fast and accurate
results, while reducing labor costs. This proprietary instrument, named the
Mago(R) system, includes a fully-automated ELISA processor operating with our
own user-friendly software, allowing customers to perform tests in an automated
mode. We also develop, manufacture, and market raw materials, such as antigens
used in the production of diagnostic kits.

         Our management reviews financial information, allocates resources and
manages the business as two segments defined by geographic region. One segment -
the domestic region - contains our subsidiaries located in the United States and
corporate operations. Our other segment - the Italian region - contains our
subsidiary located in Italy. For additional information about our two segments,
see Note 9 to our Consolidated Financial Statements.

         Delta, which IVAX acquired in 1991, was established in 1980. From its
facility located in Pomezia, Italy, it develops and manufactures scientific and
laboratory instruments, including its proprietary Mago(R) instrument, which
includes hardware, reagents, and software. The Mago(R) system, in association
with 74 specific assays acquired from Diamedix and third parties, is sold
directly in Italy through Delta's independent sales representatives, most of
whom work exclusively for Delta. Delta also sells in Italy other diagnostic
products manufactured by third parties. Approximately 90% of Delta's customers
in Italy are government owned hospitals and the remaining 10% are private
laboratories. Thus, sales in Italy are heavily concentrated in the public
sector.

         Diamedix was established in 1986 after it acquired all of the assets
and retained substantially all of the personnel of Cordis Laboratories, Inc., a
company that had developed, manufactured, and marketed diagnostic equipment
since 1962. IVAX acquired Diamedix in 1987. Diamedix' products are sold in the
United States through Diamedix' sale force. Diamedix manufactures 42 assays that
the United States Food and Drug Administration, or FDA, has cleared and that are
available to be run in conjunction with the Mago(R) system. These assays are
sold under the trade name immunosimplicity(R). Diamedix is located in Miami,
Florida.

         Since 1985, ImmunoVision has been developing, manufacturing, and
marketing autoimmune reagents and research products for use by clinics,
hospitals, research laboratories, and commercial diagnostic manufacturers. These
manufacturers (including Diamedix) use these antigens to produce autoimmune
diagnostic kits. IVAX acquired ImmunoVision in 1995. ImmunoVision is located in
Springdale, Arkansas.

         On March 21, 2002, we announced that we had signed a non-binding letter
of intent with Sigma Diagnostics, Inc., a wholly-owned subsidiary of Sigma-
Aldrich Corporation, pursuant to which we would acquire Sigma Diagnostics'
global enzyme immunoassay product line. The terms of the transaction are being
negotiated and there can be no assurance that the transaction will be
consummated or that we will be able to successfully integrate the acquired
product line. Under previous agreements with Sigma Diagnostics, which are
described below, we sold enzyme immunoassay instrumentation and reagents to
Sigma Diagnostics which they marketed throughout the world. If the proposed
acquisition is consummated, then we will no longer sell reagents or
instrumentation to Sigma Diagnostics, which had been our largest customer

                                      2
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for the past three years. Instead, we would sell enzyme immunoassay
instrumentation and reagents directly to Sigma Diagnostics' enzyme immunoassay
customer base. If the proposed acquisition is consummated, our previous
agreements with Sigma Diagnostics would cease and any issues relating to the
relationship of the parties would be resolved. In the event the proposed
acquisition is not consummated and Sigma Diagnostics does not fulfill its
obligations under its agreements with us, we will review our agreements with
Sigma Diagnostics to determine what remedies, if any, we may have. In the event
the proposed acquisition is not consummated, there can be no assurance that we
be able to replace our largest customer or that any remedies will be available
to us in connection with our agreements with Sigma Diagnostics. Any failure to
do so or lack of such remedies would have a material adverse effect on our
business, prospects, operating results, and financial condition.

         Merger. On November 21, 2000, IVAX and the pre-merger IVAX Diagnostics,
Inc., a wholly-owned subsidiary of IVAX which was incorporated in 1996 by IVAX
to be the parent corporation of Diamedix, Delta and ImmunoVision, entered into a
definitive merger agreement with us, pursuant to which the pre-merger
Diagnostics would merge with and into us, with us as the surviving corporation.
The merger was consummated on March 14, 2001, and our name was changed from
"b2bstores.com Inc." to "IVAX Diagnostics, Inc." As a result of the merger,
approximately 70% of the issued and outstanding shares of our common stock are
owned by IVAX and our business has become that of the pre-merger Diagnostics.

         We were incorporated on June 28, 1999 under the laws of the State of
Delaware. Prior to the merger, we operated an Internet web site that was
specifically designed to assist business customers in the operation and
development of their businesses. The web site was designed to provide business
customers with access to products and supplies, a network of business services
and business content. On December 1, 2000, we ceased all web site related
operations and permanently shut down our web site.

         Market. Our products are primarily associated with the in vitro
diagnostics market. In vitro diagnostic assays are tests that are used to detect
specific substances, usually either antigens or antibodies, outside the body.
This usually involves using a blood sample or other bodily fluid sample for
testing. The market for in vitro diagnostic products consists of reference
laboratory and hospital laboratory testing, testing in physician offices, and
over the counter testing, in which testing can be performed at home by the
consumer. Industry analysts have stated that the world market for in vitro
diagnostics was estimated to be $21.3 billion in 2001 and estimated to grow
during the period 2000 to 2005 at a compound annual growth rate of 6%. Of this
total $21.3 billion market, the immunoassay world market in which we operate is
estimated by industry analysts to be $6.7 billion. We have focused our efforts
on what management estimates is a $430 million market for autoimmune and
infectious disease immunoassay products. Our ELISA autoimmune product line
consists of 21 test kits that the FDA has cleared. These include test kits for
screening antinuclear antibodies and specific tests to measure antibodies to
dsDNA, SSA, SSB, Sm, Sm/RNP, Scl 70, Jo-1, Rheumatoid Factor, MPO, PR-3, TPO,
TG, and others. These products are used for the diagnosis and monitoring of
autoimmune diseases, including Systemic Lupus Erythematosus, or SLE, Rheumatoid
Arthritis, Mixed Connective Tissue Disease, Sjogren's Syndrome, Scleroderma, and
Dermatopolymyositis. Our infectious disease product line includes 21 kits that
the FDA has cleared, including Toxoplasma IgG, Toxoplasma IgM, Rubella IgG,
Rubella IgM, Cytomegalovirus, or CMV, IgG, CMV IgM, Herpes Simplex Virus, or
HSV, IgG, HSV IgM, Measles, Varicella Zoster Virus, or VZV, Lyme Disease, H.
pylori, Mumps, six different Epstein-Barr Virus, or EBV, kits and others.

         We believe that the market trend for in vitro diagnostic products is
towards increased laboratory automation that would allow laboratories to lower
their overall costs. We believe that our proprietary Mago(R) system would enable
laboratories to achieve more automation in the autoimmune and infectious disease
test sectors.

                                      3
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         We are seeking to differentiate ourselves from our competitors through
our Mago(R) instrument. While some of our competitors offer proprietary
instruments, other competitors use third parties to manufacture these
instruments for them. We believe that the cost advantage we enjoy from our own
manufacture of the Mago(R) instrument, coupled with our production of certain
autoimmune reagents at ImmunoVision and our production of diagnostic test kits
at Diamedix, positions us to target new product markets for growth beyond the
$430 million global market for autoimmune and infectious disease immunoassay
products in which we compete. We are currently planning for the release of our
next generation Mago(R) instrument which is expected to be marketed to
hospitals, reference testing laboratories, clinics and pharmaceutical, and
biotechnology research companies. There is no assurance that this next
generation instrument will be successfully launched or produced in commercial
quantities, at reasonable costs, and successfully marketed.

         Research and Development. We devote substantial resources for research
and development. For the years ended December 31, 2001, 2000 and 1999, we spent
$1.4 million, $1.3 million and $1.2 million, respectively, for research and
development activities. There is no assurance that these expenditures will
result in the development of new products or product enhancements, that
regulatory approval will be obtained or that any approved product may be
produced in commercial quantities, at reasonable costs, and be successfully
marketed.

         Our research and development efforts are targeted towards the
development of the next generation Mago(R) instrument and the development of
additional ELISA kits that can be used in conjunction with the Mago(R)
instrument. While there is no assurance that we will be successful, we are
seeking to expand the test kits menu we offer in the autoimmune and infectious
disease testing sectors and considering moving into additional diagnostic test
sectors such as HIV, Hepatitis, and allergy detection.

         Sales and Marketing. We currently market our products in the United
States through our own sales force to hospitals, reference laboratories,
clinical laboratories, and research laboratories, as well as to other commercial
companies that manufacture diagnostic products. We also sell some of our
products to pharmaceutical and biotechnology companies. In addition, some of our
products are sold on a private-label basis to other companies that resell the
products through their own distribution network. We market our products in
certain international markets through a network of independent distributors. We
market and sell our products in Italy through a network of 14 salespersons and
sales agents, most of whom work on an exclusive basis for Delta. Products are
also sold in other global markets through a number of independent distributors.
Sales personnel are trained to demonstrate our products, such as the Mago(R)
system, in the laboratory setting. The marketing and technical service
departments located in Miami, Florida, Springdale, Arkansas, and Pomezia, Italy
support their efforts. We participate in a number of industry trade shows in the
United States and Europe.

         The products we market are purchased principally by healthcare
providers that typically bill third party payors such as governmental programs
(e.g., Medicare and Medicaid), private insurance plans, and managed care plans,
for health care services provided to their patients. Governmental reimbursement
policies are subject to rapid and significant changes in the United States at
both the federal and state levels and in other countries. Private third party
payors are increasingly negotiating the prices charged for medical products and
services. There can be no assurance that healthcare providers will not respond
to such pressures by substituting competitors' products for our products. A
third party payor may deny reimbursement if it determines that a device was not
used in accordance with cost-effective treatment methods, was experimental, or
for other reasons. There can be no assurance that our products will qualify for

                                      4
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reimbursement by governmental programs in accordance with guidelines established
by the Health Care Financing Administration, by state government payors, or by
commercial insurance carriers, or that reimbursement will be available in other
countries.

         In April 1999, we entered into a three year contract with Sigma
Diagnostics pursuant to which Sigma Diagnostics agreed to purchase from us a
minimum number of scientific instruments per year. Twice during the year 2000,
Sigma Diagnostics notified us that it desired to suspend shipments of
instruments while our representatives and Sigma Diagnostics' representatives
resolved certain product issues. The first suspension lasted for a period of
approximately four months. The second suspension began in October 2000 and ended
in January 2001. During the last six months of 2001 and to date in 2002, Sigma
Diagnostics made no purchases of instruments based upon its determination that
it had an adequate level of inventory. In addition, in October 2000, we entered
into a three year contract with Sigma Diagnostics pursuant to which we agreed to
sell to Sigma Diagnostics certain infectious disease diagnostic kits under a
private-label arrangement. Sigma Diagnostics is not required to make a minimum
level of purchases under this private-label arrangement. During calendar years
2001, 2000 and 1999 our net revenues from such sales of instruments, replacement
parts and diagnostic kits represented 24.9%, 40.1% and 27.8%, respectively, of
our total net revenues for such periods.

         On March 21, 2002, we announced that we had signed a non-binding letter
of intent with Sigma Diagnostics pursuant to which we would acquire Sigma
Diagnostics' global enzyme immunoassay product line. The terms of the
transaction are being negotiated. Under previous agreements with Sigma
Diagnostics, which are described above, we sold enzyme immunoassay
instrumentation and reagents to Sigma Diagnostics which they marketed throughout
the world. If the proposed acquisition is consummated, then we will no longer
sell reagents or instrumentation to Sigma Diagnostics, which had been our
largest customer for the past three years. Instead, we would sell enzyme
immunoassay instrumentation and reagents directly to Sigma Diagnostics' enzyme
immunoassay customer base. There can be no assurance that this acquisition will
be successfully consummated or that we will be able to successfully integrate
the acquired product line. If the proposed acquisition is consummated, our
previous agreements with Sigma Diagnostics would cease and any issues relating
to the relationship of the parties would be resolved. In the event the proposed
acquisition is not consummated and Sigma Diagnostics does not fulfill its
obligations under its agreements with us, we will review our agreements with
Sigma Diagnostics to determine what remedies, if any, we may have. In the event
the proposed acquisition is not consummated, there can be no assurance that we
will be able to replace our largest customer or that any remedies will be
available to us in connection with our agreements with Sigma Diagnostics. Any
failure to do so or lack of such remedies would have a material adverse effect
on our business, prospects, operating results, and financial condition.

         Our business is not considered seasonal in nature, but our Italian
operations may be slightly affected by the general reduction in business
activity in Europe during the traditional summer vacation months.

         Our business is not materially affected by order backlog or working
capital issues.

         Competition. We compete on a worldwide basis and there are numerous
competitors in the specific market sectors in which we offer our products. These
competitors range from major pharmaceutical companies to development stage
diagnostic companies. Many of these companies, such as Abbott Laboratories and
Pharmacia Corporation, are much larger and have significantly greater financial,
technical, manufacturing, sales, and marketing resources than us.

                                      5
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The diagnostics industry has experienced considerable consolidation through
mergers and acquisitions in the past several years. At the same time, the
competition in test sectors such as autoimmune is very fragmented as it is
comprised of primarily small companies with no single company possessing a
dominant market position. We compete in the marketplace on the basis of the
quality of our products, price, instrument design and efficiency, as well as our
relationships with customers. In addition to Abbott Laboratories and Pharmacia
Corporation, our competitors include DiaSorin, Hemagen Diagnostics, Inc., Sigma
Diagnostics, Meridian Bioscience, Inc., Wampole Laboratories (Carter-Wallace,
Inc.), Hycor Biomedical, Inc. and Trinity Biotech plc.

         The in vitro diagnostic market in which we sell many of our products is
highly competitive. The market for our products is characterized by continual
and rapid technological developments that have resulted in, and will likely
continue to result in, substantial improvements in product function and
performance. Our success will depend, in part, in our ability to anticipate
changes in technology and industry requirements and to respond to technological
developments on a timely basis either internally or through strategic alliances.
Several companies have developed, or are developing, scientific instruments and
assays that compete or will compete directly with products we market. Many
existing and potential competitors have substantially greater financial,
marketing, research, and technological resources, as well as established
reputations for success in developing, manufacturing, selling, and servicing
products, than us. Competitors that are more vertically integrated than us may
have more flexibility to compete effectively on price. We expect that existing
and new competitors will continue to introduce products or services that are,
directly or indirectly, competitive with those that we sell. Such competitors
may succeed in developing products that are more functional or less costly than
those sold by us and may be more successful in marketing such products. These
and other innovations in the rapidly changing medical technology market will
negatively affect the sales of the products we market. There can be no assurance
that we will be able to compete successfully in this market or that technology
developments by our competitors will not render our products or technologies
obsolete.

         Personnel. As of December, 2001, we had approximately 97 full time
employees, of whom 16 were managerial, 44 were technical and manufacturing, 11
were administrative, and 26 were sales and marketing.

         Intellectual Property. In December 1994, Diamedix entered into an
intellectual property agreement with two inventors pursuant to which it acquired
all rights, title, and interest in the Mago(R) instrument, including all related
software and technical information. Separately, on December 12, 1994, Diamedix
entered into consulting agreements with each of the inventors. Only one of these
consulting agreements currently remains in effect. Under the terms of the
intellectual property agreement, as amended, Diamedix is required to pay the
inventors $1,000 per instrument produced beginning with the fifteenth instrument
produced, until August 31, 2002, unless the remaining consulting agreement
terminates. If the remaining consulting agreement terminates before August 31,
2002, then Diamedix' per instrument payment will cease on the date that such
consulting agreement terminates. Alternatively, in lieu of the per instrument
payment, Diamedix may, at its election, make a lump sum payment to the inventors
equal to $3,000 per instrument produced, beginning with the fifteenth instrument
produced and ending with the last instrument produced, before the date of
Diamedix' election, minus all royalty payments previously made to the inventors
pursuant to the intellectual property agreement. In the event of breach by
Diamedix of the intellectual property agreement, the only recourse available to
the inventors is to sue Diamedix for damages. Diamedix would, in any event,
retain all right, title, and interest in the Mago(R) instrument.

                                      6
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         The technology associated with the design and manufacture of the
Mago(R) instrument is not protected by patent registrations or license
restrictions. The Mago(R) instrument is our primary product. There can be no
assurance that our competitors will not gain access to our proprietary and
confidential technologies, or that they will not independently develop similar
or competing technologies.

         On March 14, 2001, we entered into a use of name license with IVAX
whereby IVAX granted us a non-exclusive, royalty free license to use the name
"IVAX." IVAX could not terminate this license for a one-year period. After the
first year, IVAX may terminate this license at any time upon 90 days' written
notice. Upon termination of the agreement, we are required to take all steps
reasonably necessary to change our name as soon as is practicable. The
termination of this agreement by IVAX could have a material adverse affect on
our ability to market our products and on us.

         Governmental Regulation. The testing, manufacturing, and sale of our
products are subject to regulation by numerous governmental authorities,
principally the FDA. To comply with FDA requirements, we must manufacture our
products in conformance with the FDA's medical device Quality System
regulations. Diamedix is listed as a registered establishment with the FDA and
Delta has received ISO 9002 certification validating its quality system. The FDA
classifies medical devices into three classes (Class I, II or III). Class I
devices are subject to general controls, such as good manufacturing practices,
and may or may not be subject to pre-market notification. Pre-market
notifications must be submitted to the FDA before products can be commercially
distributed. Some Class I devices have been deemed exempt from this requirement
by the FDA. Class II devices are subject to the same general controls,
pre-market notification and performance standards. Usually, Class III devices
are those that must receive pre-market approval by the FDA to ensure their
safety and effectiveness. Most of our products are classified as Class I or II
devices. Generally, before a new test kit can be introduced to the market, it is
necessary to obtain FDA clearance in the form of a pre-market 510(k)
notification. A 510(k) notification provides data to show that the new device is
substantially equivalent to other devices in the marketplace. Almost all of the
products sold by us have received 510(k) clearance. In addition, customers using
diagnostic tests for clinical purposes in the United States are also regulated
under the Clinical Laboratory Improvement Amendments of 1988, or CLIA. CLIA is
intended to ensure the quality and reliability of all medical testing in
laboratories in the United States by requiring that any health care facility in
which testing is performed meets specified standards in the areas of personnel
qualification, administration, participation in proficiency testing, patient
test management, quality control, quality assurance, and inspections.

         Additionally, the products we sell are subject to extensive regulation
by governmental authorities in the United States and other countries. Such
regulation includes the regulation of the testing, approval, manufacturing,
labeling, marketing, and sale of diagnostic devices. Failure to comply with
these governmental regulations can result in fines, unanticipated compliance
expenditures, interruptions of production, and criminal prosecution. The process
of obtaining regulatory approval is rigorous, time consuming, and costly. There
is no assurance that necessary approvals will be attained on a timely basis, if
at all. In addition, product approvals can be withdrawn if we fail to comply
with regulatory standards or if unforeseen problems occur following initial
marketing. Domestic and foreign regulations are subject to change and extensive
changes in regulation may increase our operating expenses. There can be no
assurance that we will not encounter delays in obtaining necessary domestic or
foreign regulatory approvals, if at all, or failures to comply with applicable
regulatory requirements, or extensive changes in regulation.

                                      7
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         We are also subject to numerous federal, state, and local laws relating
to such matters as safe working conditions, manufacturing practices,
environmental protection, fire hazard control, and disposal of hazardous or
potentially hazardous substances.

         Our employment relations in Italy are governed by numerous regulatory
and contractual requirements, including national collective labor agreements and
individual employer labor agreements. These arrangements address a number of
specific issues affecting our working conditions including hiring, work time,
wages and benefits, and termination of employment. We must make significant
payments in order to comply with these requirements.

ITEM 2.    PROPERTIES

         Our corporate headquarters are located in Miami, Florida. Our corporate
headquarters share facilities with Diamedix, which owns approximately 56,000
square feet of buildings at its facility in Miami, Florida. From this facility,
Diamedix conducts research and development of in vitro diagnostic products,
reagent kit manufacturing, marketing, and corporate management activities. Delta
leases approximately 25,000 feet of industrial space in Pomezia, Italy. This
facility is where the Mago(R) instrument is manufactured. ImmunoVision leases
approximately 5,700 square feet of commercial space in Springdale, Arkansas.

         We believe our facilities are in satisfactory condition, are suitable
for their intended use and, in the aggregate, have capacities in excess of those
necessary to meet our present needs. A portion of our facilities, as well as our
corporate headquarters and other critical business functions are located in
areas subject to hurricane casualty risk. Although we have certain limited
protection afforded by insurance, our business and our earnings could be
materially adversely affected in the event of a major windstorm.

ITEM 3.    LEGAL PROCEEDINGS

         On March 2, 2001, b2bstores received notice that a shareholder of
b2bstores filed a lawsuit against b2bstores and two of its directors in the
United States District Court for the Western District of Texas, San Antonio
Division. The lawsuit alleges that b2bstores violated certain aspects of Section
14(a) of the Securities Exchange Act of 1934, as amended, and that certain
directors breached their fiduciary duties in connection with the merger. The
suit seeks the court's determination of declaratory relief as to whether (i) the
proxy statement materials sent to shareholders should be considered null, void
and unenforceable, (ii) the merger, if accomplished based on the use of the
proxy materials, should be set aside, and (iii) the termination fee of $1.0
million, as defined in the merger agreement, should be found void. Our directors
and officers deny the allegations and intend to vigorously defend such claims,
but the ultimate outcome of any such legal proceeding cannot be determined.

         We are also involved in various legal claims and actions and regulatory
matters and other notices and demand proceedings arising in the ordinary course
of business. While it is not feasible to predict or determine the outcome of
these proceedings, in the opinion of management, based on a review with legal
counsel, any losses resulting from such legal proceedings would not have a
material adverse impact on our financial position, results of operations or cash
flows.

ITEM 4.    SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

         No matters were submitted to a vote of security holders during the
quarter ended December 31, 2001.

                                      8
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                                     PART II

ITEM 5.    MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

         Since March 15, 2001, following consummation of the merger, our common
stock has been listed on the American Stock Exchange and has been traded under
the symbol IVD. From February 16, 2000 through March 14, 2001, prior to
consummation of the merger, our common stock was listed on the NASDAQ Small Cap
Market and was traded under the symbol BTBC.

         As of the close of business on March 20, 2002, there were approximately
41 holders of record of our common stock.

         The following table sets forth the high and low sales price of a share
of our common stock for each quarter in 2001, since March 15, 2001, as reported
by the American Stock Exchange and the high and low bids of a share of our
common stock for each quarter in 2000 and 2001, from February 16, 2000 through
March 14, 2001, as reported by the NASDAQ Small Cap Market:

2001                                           High                     Low
----                                           ----                     ---

Fourth Quarter                                 4.27                     2.80
Third Quarter                                  5.25                     2.10
Second Quarter                                 5.50                     2.90
First Quarter (Since March 15, 2001)           4.80                     2.80
First Quarter (Through March 14, 2001)         3.6312                   1.5000

2000
----

Fourth Quarter                                 2.0312                   1.1875
Third Quarter                                  2.8125                   1.1250
Second Quarter                                10.0000                   2.3125
First Quarter (Beginning February 16, 2000)   19.5000                   7.3750

         We did not pay cash dividends on our common stock during 2000 or 2001
and we do not intend to pay any cash dividends in the foreseeable future.

                                      9
<PAGE>

ITEM 6.    SELECTED FINANCIAL DATA

         The historical selected financial data prior to consummation of the
merger are those of the pre-merger Diagnostics with retroactive restatement of
equity and earnings per share.

                                   (In thousands except per share data)

<TABLE>
<CAPTION>
                                                                    For the Years Ended December 31,
                                                        2001         2000         1999         1998         1997
                                                        ----         ----         ----         ----         ----
<S>                                                   <C>           <C>        <C>          <C>          <C>
Consolidated Income Statement
of Operations Data:
Net Revenues..................................        $ 10,299      $11,793    $ 11,237     $  9,719     $  9,429
Income (loss) from operations ................        $ (3,874)     $   162    $ (1,441)    $ (3,502)    $ (5,248)
Net loss......................................        $ (3,509)     $(1,855)   $ (2,466)    $ (3,582)    $ (4,862)
Net loss per common share.....................        $   (.13)     $  (.09)   $   (.12)    $   (.18)    $   (.24)
Weighted average number of
common shares outstanding.....................          26,879       20,000      20,000       20,000       20,000
</TABLE>

<TABLE>
<CAPTION>
                                                                           As of December 31,
                                                        2001         2000         1999         1998         1997
                                                        ----         ----         ----         ----         ----
<S>                                                   <C>           <C>        <C>          <C>          <C>
Balance Sheet Data:
Working capital...............................        $27,812       $ 6,029    $  8,600     $  8,176     $  7,438
Total assets .................................        $40,147       $19,113    $ 21,662     $ 22,120     $ 21,264
Total liabilities.............................        $ 3,347       $11,894    $ 12,000     $  8,668     $  5,404
Total stockholders' equity....................        $36,800       $ 7,219    $  9,662     $ 13,452     $ 15,860
</TABLE>

ITEM 7.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
           RESULTS OF OPERATIONS

         The following discussion and analysis should be read in conjunction
with our Consolidated Financial Statements and the related Notes to Consolidated
Financial Statements on pages 21 to 45 of this Annual Report on Form 10-K.

OVERVIEW

         We are the parent corporation of the following three subsidiaries:

                . Delta Biologicals, S.r.l.;

                . Diamedix Corporation; and

                . ImmunoVision, Inc.

         Through these subsidiaries, we develop, manufacture, and market
diagnostic test kits, or assays, that are used to aid in the detection of
disease markers primarily in the areas of autoimmune and infectious diseases. In
addition to diagnostic kits, we also design and manufacture laboratory
instruments that perform the tests and provide fast and accurate results, while
reducing labor costs. We also develop, manufacture, and market raw materials,
such as antigens used in the production of diagnostic kits.

         Our management reviews financial information, allocates resources and
manages the business as two segments defined by geographic region. One segment-
the domestic region -

                                     10
<PAGE>

contains our subsidiaries located in the United States and corporate operations.
Our other segment - the Italian region - contains our subsidiary located in
Italy.

         From its facility located in Pomezia, Italy, Delta develops and
manufactures scientific and laboratory instruments, including its proprietary
Mago(R) instrument, which includes hardware, reagents, and software. The Mago(R)
system, in association with 74 specific assays acquired from Diamedix and third
parties, is sold directly in Italy through Delta's independent sales
representatives, most of whom work exclusively for Delta. Delta also sells in
Italy other diagnostic products manufactured by third parties. Approximately 90%
of Delta's customers in Italy are government owned hospitals and the remaining
10% are private laboratories. Thus, sales in Italy are heavily concentrated in
the public sector.

         Diamedix' products are sold in the United States through Diamedix' sale
force. Diamedix manufactures 42 assays that the FDA has cleared and that are
available to be run in conjunction with the Mago(R) system. These assays are
sold under the trade name immunosimplicity(R).

         ImmunoVision develops, manufactures, and markets autoimmune reagents
and research products for use by clinics, hospitals, research laboratories, and
commercial diagnostic manufacturers. These manufacturers (including Diamedix)
use these antigens to produce autoimmune diagnostic kits.

         On March 21, 2002, we announced that we had signed a non-binding letter
of intent with Sigma Diagnostics pursuant to which we would acquire Sigma
Diagnostics' global enzyme immunoassay product line. The terms of the
transaction are being negotiated and there can be no assurance that the
transaction will be consummated or that we will be able to successfully
integrate the acquired product line. Under previous agreements with Sigma
Diagnostics, which are described above, we sold enzyme immunoassay
instrumentation and reagents to Sigma Diagnostics which they marketed throughout
the world. If the proposed acquisition is consummated, then we will no longer
sell reagents or instrumentation to Sigma Diagnostics, which had been our
largest customer for the past three years. Instead, we would sell enzyme
immunoassay instrumentation and reagents directly to Sigma Diagnostics' enzyme
immunoassay customer base. If the proposed acquisition is consummated, our
previous agreements with Sigma Diagnostics would cease and any issues relating
to the relationship of the parties would be resolved. In the event the proposed
acquisition is not consummated and Sigma Diagnostics does not fulfill its
obligations under its agreements with us, we will review our agreements with
Sigma Diagnostics to determine what remedies, if any, we may have. In the event
the proposed acquisition is not consummated, there can be no assurance that we
will be able to replace our largest customer or that any remedies will be
available to us in connection with our agreements with Sigma Diagnostics. Any
failure to do so or lack of such remedies would have material adverse effect on
our business, prospects, operating results, and financial condition.

         The historical financial statements prior to the merger of us and the
pre-merger Diagnostics are those of the pre-merger Diagnostics with no
adjustments except for retroactive restatement, as if a stock split occurred, to
reflect the 20,000,000 shares of common stock that IVAX received in the merger
as outstanding for all periods presented.

RESULTS OF OPERATIONS

YEAR ENDED DECEMBER 31, 2001 COMPARED TO THE YEAR ENDED DECEMBER 31, 2000

NET REVENUES AND GROSS PROFIT

         Net revenue for the year ended December 31, 2001 totaled $10,299,000, a
decrease of $1,494,000, or 12.7%, from the $11,793,000 reported in the prior
year comparable period. This decrease was comprised of a decrease of $1,965,000
in external net revenue from Italian

                                     11
<PAGE>

operations partially offset by an increase in external net revenue of $471,000
from domestic operations. External net revenue from Italian operations totaled
$5,683,000 for the year ended December 31, 2001, compared to $7,648,000 for the
year ended December 31, 2000. This 25.7% decrease was primarily attributable to
decreased sales volume of instrumentation products primarily due to Sigma
Diagnostics related issues discussed in Notes 4 and 13. External domestic
operations generated net revenue of $4,616,000 for the year ended December 31,
2001, compared to $4,145,000 for the year ended December 31, 2000. This
$471,000, or 11.4 % increase, was primarily due to volume increases in revenue
from instrumentation placements partially offset by decreased volume of raw
material antigen sales. Gross profit for the year ended December 31, 2001
decreased $968,000, or 15.1%, to $5,445,000 (52.9% of net revenue) from
$6,413,000 (54.4% of net revenue) for the year ended December 31, 2000. This
decrease in gross profit was primarily attributable to decreased revenue from
sales of instrumentation products. The decrease in gross profit as a percentage
of net revenue of 1.5% was primarily due to lower revenue from sales of
instrumentation products (which are generally sold at a higher gross margin)
partially offset by improved manufacturing efficiencies achieved due to volume
increases in revenue from domestic instrument placements.

OPERATING EXPENSES

         Selling expenses of $3,191,000 (31.0% of net revenue) for the year
ended December 31, 2001 were composed of domestic expenses of $1,772,000 and
$1,419,000 from Italian operations. For the year ended December 31, 2000,
domestic selling expenses were $1,189,000 while $1,435,000 was incurred in
Italy, totaling $2,624,000 (22.3% of net revenue). This increase in consolidated
selling expenses of $567,000 was primarily due to greater payroll costs related
to increased domestic instrument system sales efforts. General and
administrative expenses totaled $4,455,000 (43.3% of net revenue) for the year
ended December 31, 2001, an increase of $2,373,000, from $2,082,000 (17.7% of
net revenue) for the year ended December 31, 2000. This increase was primarily
the result of the recognition, in accordance with Accounting Principles Board
Opinion No. 25, of $1,486,000 in stock option compensation expense from the
conversion of outstanding options under our 1999 Stock Option Plan to non-
qualified stock options as a result of the merger. The remaining $892,000 non-
cash compensation cost resulting from such conversion will be expensed over the
remaining vesting term of the options through June 30, 2003. This increase over
the prior period was also due to a partial reimbursement of legal fees received
from a settlement of patent litigation in 2000, as well as an increase in
professional fees incurred in 2001 associated with the completion of the merger
and the establishment of our independent public structure. Research and
development expenses totaled $1,418,000 for the year ended December 31, 2001
compared to $1,291,000 for the year ended December 31, 2000, representing 13.8%
and 10.9% of net revenues, respectively. The increase of $127,000 was the result
of an increase in research and development expenses in the Italian operations to
$257,000 in the year ended December 31, 2001 from $134,000 in the year ended
December 31, 2000. This increase was the result of increased research of
instrumentation products. The future level of research and development
expenditures will depend on, among other things, the outcome of ongoing testing
of products and instrumentation under development, delays or changes in
government required testing and approval procedures, technological and
competitive developments, strategic marketing decisions and liquidity.

OPERATING INCOME

         Operating loss was $3,874,000 for the year ended December 31, 2001
compared to operating income of $162,000 in the year ended December 31, 2000.
Exclusive of intersegment elimination adjustments that reduced consolidated
operating loss by $125,000, operating loss in the year ended December 31, 2001
was composed of an operating loss of $4,417,000 for

                                     12
<PAGE>

domestic operations and operating income of $667,000 from Italian operations.
Excluding intersegment elimination adjustments that increased consolidated
operating income by $24,000 in the year ended December 31, 2000, domestic
operations incurred an operating loss of $2,354,000 while Italian operations
generated operating income of $2,492,000.

OTHER INCOME (EXPENSE)

         Interest income increased to $743,000 for the year ended December 31,
2001 from $158,000 for the year ended December 31, 2000 due to interest earned
on cash received in the merger. Interest expense-related party amounted to
$93,000 for the year ended December 31, 2001 and $526,000 for the year ended
December 31, 2000, a decrease of $433,000. The related party interest expense
was incurred on intercompany advances from IVAX. As a result of the merger,
intercompany advances from IVAX were contributed to capital. Other income, net,
totaled $58,000 during the year ended December 31, 2001, compared to other
expense, net, of $117,000 during the year ended December 31, 2000, an increase
of $175,000. This increase was due to larger net foreign currency losses
recognized in 2000 by the pre-merger Diagnostics on transactions by its Italian
subsidiary, which were denominated in currencies other than its functional
currency.

YEAR ENDED DECEMBER 31, 2000 COMPARED TO THE YEAR ENDED DECEMBER 31, 1999

NET REVENUES AND GROSS PROFIT

         Net revenues for the year ended December 31, 2000 totaled $11,793,000,
an increase of $556,000, or 4.9%, from the $11,237,000 reported in the prior
year. This increase was comprised of an increase of $362,000 in net revenues
from Italian operations as well as an increase of $194,000 in net revenues from
domestic operations. Net revenues from Italian operations totaled $7,648,000 for
the year ended December 31, 2000, compared to $7,286,000 for the year ended
December 31, 1999. This $362,000, or 3.2%, increase was primarily attributable
to increased sales volume of instrumentation, partially offset by the effect of
foreign exchange differences. Domestic operations generated net revenues of
$4,145,000 for the year ended December 31, 2000, compared to $3,951,000 for the
year ended December 31, 1999. This $194,000, or 4.9%, increase was primarily due
to volume increases in instrumentation revenue. Gross profit for the year ended
December 31, 2000 increased $501,000, or 8.5%, to $6,413,000 (54.4% of net
revenues) from $5,912,000 (52.6% of net revenues) for the year ended December
31, 1999. The increase in gross profit and gross profit percentage was primarily
attributable to the increase in sales of instrumentation products (which were
generally sold at a higher gross margin).

OPERATING EXPENSES

         Selling expenses of $2,624,000 (22.3% of net revenues) for the year
ended December 31, 2000 were composed of domestic expenses of $1,189,000 and
$1,435,000 from Italian operations. For the year ended December 31, 1999,
domestic selling expenses were $1,423,000 while $1,519,000 was incurred in
Italy, totaling $2,942,000 (26.2% of net revenues). This decrease was primarily
due to the effect of foreign exchange rate differences as well as reductions in
payroll and travel costs within the domestic region. General and administrative
expenses totaled $2,082,000 (17.7% of net revenues) in the year ended December
31, 2000, a decrease of $856,000, or 29.1%, from $2,938,000 (26.1% of net
revenues) in the year ended December 31, 1999. This decrease was primarily the
result of a partial reimbursement of legal fees received from a settlement of
patent litigation in 2000, as

                                     13
<PAGE>

well as a reduction of legal fees incurred in 1999 associated with patent
litigation and accounts receivable collection costs. Research and development
expenses of $1,291,000 (10.9% of net revenues) for the year ended December 31,
2000 were composed of domestic expenses of $1,157,000 and $134,000 from Italian
operations. For the year ended December 31, 1999, research and development
expenses of $1,184,000 from domestic operations and $32,000 from Italian
operations totaled $1,216,000 (10.8% of net revenues). The increase of $75,000,
or 6.2% was primarily due to increased instrumentation research.

OPERATING INCOME

         Operating income was $162,000 for the year ended December 31, 2000
compared to an operating loss of $1,441,000 in the year ended December 31,
1999. Exclusive of intersegment elimination adjustments that increased
consolidated operating loss by $24,000, operating loss in the year ended
December 31, 2000 was composed of an operating loss of $2,354,000 for domestic
operations and operating income of $2,492,000 from Italian operations. After
excluding intersegment elimination adjustments that reduced consolidated
operating income by $55,000 in the year ended December 31, 1999, domestic
operations incurred an operating loss of $3,194,000 while Italian operations
generated operating income of $1,808,000.

OTHER INCOME (EXPENSE)

         Interest income decreased $162,000 to $158,000 for the year ended
December 31, 2000 compared to $320,000 for the year ended December 31, 1999. The
decrease is due to interest received in 1999 as a result of accounts receivable
collection efforts in Italy. Interest expense-related party amounted to $526,000
for the year ended December 31, 2000 and $507,000 for the year ended December
31, 1999, an increase of $19,000. The related party interest was incurred on
intercompany advances from IVAX. Other expense, net, totaled $117,000 during the
year ended December 31, 2000, compared to other income, net, of $23,000 during
the year ended December 31, 1999, a decrease of $140,000. The decrease was due
to larger net foreign currency losses recognized in 2000 by the pre-merger
Diagnostics on transactions by its Italian subsidiary, which were denominated in
currencies other than its functional currency.

LIQUIDITY AND CAPITAL RESOURCES

         At December 31, 2001, our working capital was $27,812,000 compared to
$6,029,000 at December 31, 2000. Our net assets on the date of merger were
$22,255,000, consisting primarily of cash of $22,285,000. As a condition of the
merger, intercompany indebtedness of $9,581,000 existing between IVAX and the
pre-merger Diagnostics was contributed to capital. Cash and cash equivalents
totaled $23,282,000 at December 31, 2001, as compared to $1,263,000 at December
31, 2000. Substantially all cash and cash equivalents are presently held at one
national securities brokerage firm. Accordingly, we are subject to credit risk
if this brokerage firm is unable to repay the balance in the account or deliver
our securities or if the brokerage firm should become bankrupt or otherwise
insolvent. We only invest in select money market instruments, municipal
securities and corporate issuers.

         Net cash flows of $936,000 were used in operating activities during the
year ended December 31, 2001, compared to $1,228,000 used during the year ended
December 31, 2000. The reduction in cash used during the year ended December 31,
2001 in operating activities compared to the same period of the prior year was
primarily the result of an increase in cash received from accounts receivable
collections, partially offset by reduced operating results

                                     14
<PAGE>

adjusted for non-cash items and an increase in cash utilized to pay accounts
payable and accrued expenses.

         Net cash flows of $834,000 were used in investing activities during the
year ended December 31, 2001, as compared to $517,000 used during the same
period of the prior year. The increase in cash used was primarily the result of
the acquisition of equipment on lease.

         Net cash flows of $24,108,000 were provided by financing activities
during the year ended December 31, 2001, compared to $703,000 used during the
same period of 2000. The increase in cash provided in 2001 was primarily due to
cash of $22,285,000 that was included in our net assets acquired in the merger
with the pre-merger Diagnostics. Other differences in net cash flows provided by
or used in financing activities during the two year period ending December 31,
2001 are primarily due to funds received or paid to IVAX during the respective
years.

         Our product research and development expenditures are expected to be
approximately $1,600,000 during 2002, subject to adjustment in the event our
proposed transaction with Sigma Diagnostics is consummated, although actual
expenditures will depend on, among other things, the outcome of clinical testing
of products under development, delays or changes in government required testing
and approval procedures, technological and competitive developments, strategic
marketing decisions and liquidity. There can be no assurance that we will
successfully complete products under development, that we will be able to obtain
regulatory approval for any such products, or that any approved product will be
produced in commercial quantities, at reasonable costs, and be successfully
marketed. In addition, we expect to spend approximately $300,000 in fiscal 2002
to improve and expand our equipment and facilities, subject to adjustment in the
event our proposed transaction with Sigma Diagnostics is consummated.

         Our principal source of short term liquidity is existing cash and cash
equivalents received as a result of the completion of the merger, which we
believe will be sufficient to meet our operating needs and anticipated capital
expenditures over the short term. For the long term, we intend to utilize
principally existing cash and cash equivalents as well as internally generated
funds, which are anticipated to be derived primarily from the sale of existing
diagnostic and instrumentation products and diagnostic and instrumentation
products currently under development. To the extent that the aforementioned
sources of liquidity are insufficient, we may consider issuing debt or equity
securities or curtailing or reducing our operations.

         In April 1999, we entered into a three year contract with Sigma
Diagnostics, pursuant to which Sigma Diagnostics agreed to purchase from us a
minimum number of scientific instruments per year. Twice during the year 2000,
Sigma Diagnostics notified us that it desired to suspend shipments of
instruments while our representatives and Sigma Diagnostics' representatives
resolved certain product issues. The first suspension lasted for a period of
approximately four months. The second suspension began in October 2000 and ended
in January 2001. During the last six months of 2001 and to date in 2002, Sigma
Diagnostics made no purchases of instruments based upon its determination that
it had an adequate level of instruments in inventory. In addition, in October
2000, we entered into a three year contract with Sigma Diagnostics pursuant to
which we agreed to sell to Sigma Diagnostics certain infectious disease
diagnostic kits under a private-label arrangement. Sigma Diagnostics is not
required to make a minimum level of purchases under this private-label
arrangement. During the years ended December 31, 2001, 2000 and 1999, our net
revenues from such sales of instruments, replacement parts and diagnostic kits
represented 24.9%, 40.1% and 27.8%, respectively, of our total net revenues for
such periods.

                                     15
<PAGE>

         On March 21, 2002, we announced that we had signed a non-binding letter
of intent with Sigma Diagnostics pursuant to which we would acquire Sigma
Diagnostics' global enzyme immunoassay product line. The terms of the
transaction are being negotiated. Under previous agreements with Sigma
Diagnostics, which are described above, we sold enzyme immunoassay
instrumentation and reagents to Sigma Diagnostics which they marketed throughout
the world. If the proposed acquisition is consummated, then we will no longer
sell reagents or instrumentation to Sigma Diagnostics, which had been our
largest customer for the past three years. Instead, we would sell enzyme
immunoassay instrumentation and reagents directly to Sigma Diagnostics' enzyme
immunoassay customer base. There can be no assurance that this acquisition will
be successfully consummated or that we will be able to successfully integrate
the acquired product line. If the proposed acquisition is consummated, our
previous agreements with Sigma Diagnostics would cease and any issues relating
to the relationship of the parties would be resolved. In the event the proposed
acquisition is not consummated and Sigma Diagnostics does not fulfill its
obligations under its agreements with us, we will review our agreements with
Sigma Diagnostics to determine what remedies, if any, we may have. In the event
the proposed acquisition is not consummated, there can be no assurance that we
will be able to replace our largest customer or that any remedies will be
available to us in connection with our agreements with Sigma Diagnostics. Any
failure to do so or lack of such remedies would have a material adverse effect
on our business, prospects, operating results, and financial condition.

CRITICAL ACCOUNTING POLICIES

         Our discussion and analysis of our financial condition and results of
operations are based upon our consolidated financial statements, which have been
prepared in accordance with accounting principles generally accepted in the
United States. The preparation of these financial statements requires us to make
estimates and judgments that affect the reported amounts of assets, liabilities,
revenues and expenses, and related disclosure of contingent assets and
liabilities. On an on-going basis, we evaluate our estimates, including those
related to product returns, allowance for doubtful accounts, inventories,
intangible assets, income and other tax accruals, warranty obligations, and
contingencies and litigation. We base our estimates on historical experience and
on various other assumptions that are believed to be reasonable under the
circumstances, the results of which form the basis for making judgments about
the carrying values of assets and liabilities that are not readily apparent from
other sources. Our assumptions and estimates may, however, prove to have been
incorrect and our actual results may differ from these estimates under different
assumptions or conditions. We believe the following critical accounting policies
and the judgments and estimates we make concerning their application have
significant impact on our consolidated financial statements.

         A principal source of revenue is our "reagent rental" program in which
customers make reagent kit purchase commitments with us that typically last for
a period of three to five years. In exchange, we provide at no cost a Mago(R)
instrument and any required instrument service, which are paid for by the
customer through these reagent kit purchases over the life of the commitment. We
recognize revenue from the reagent kit sales only at the time of shipment and
passage of title. Should actual reagent kit or instrument failure rates
significantly increase, our future operating results could be negatively
impacted by increased warranty obligations and service delivery costs.

         We maintain allowances for doubtful accounts, particularly in Italy for
the operations of our Italian subsidiary, for estimated losses resulting from
the inability of our customers to make required payments. If the financial
condition of our customers were to deteriorate, resulting in an impairment of
their ability to make payments, then we may be required to make additional
allowances which would adversely affect our operating results during the period
in which the determination or reserve is or was made.

         We regularly review inventory quantities on hand and, if necessary,
record a provision for excess and obsolete inventory based primarily on our
estimates of product demand and

                                     16
<PAGE>

production requirements. These estimates of future product demand may prove to
be inaccurate, in which case any resulting adjustments to the value of
inventory would be recognized in our cost of goods sold at the time of such
determination.

         Pursuant to SFAS No. 142, "Goodwill and Other Intangible Assets," we
will be required to analyze our goodwill for impairment issues during the first
six months of fiscal 2002, and on a periodic basis thereafter. In assessing the
recoverability of our goodwill and other intangibles, we must make assumptions
regarding estimated future cash flows, including current and projected levels of
income, business trends, prospects and market conditions, to determine the fair
value of the respected assets. If these estimates or their related assumptions
change in the future, we may be required to record impairment charges for these
assets not previously recorded. Any resulting impairment loss would be recorded
as a charge against our earnings and could have a material adverse impact of our
financial condition and results of operations.

         We accounted for income taxes on our consolidated financial statements
on a stand-alone basis as if we had filed our own income tax returns. However,
the pre-merger Diagnostics reported its income taxes until the merger as part of
a consolidated group. Therefore, all domestic net operating losses generated
prior to the merger were utilized by IVAX. Since the merger, we have experienced
domestic losses from operations. Accounting principles generally accepted in the
United States require that we record a valuation allowance against the deferred
tax asset associated with these losses if it is "more likely than not" that we
will not be able to utilize the net operating loss to offset future taxes. Due
to the losses from the operations of our domestic operations since the merger,
we have provided full valuation reserves against domestic deferred tax assets
and currently provide for only foreign income taxes. Over time we may reach
levels of profitability which could cause our management to conclude that it is
more likely than not that we will realize all or a portion of the net operating
loss carryforward. Upon reaching such a conclusion, and upon such time as we
reversed the entire valuation against the deferred tax asset, we would then
provide for income taxes at a rate equal to our combined federal and state
effective rates. This and subsequent revisions to the estimated net realizable
value of the deferred tax asset could cause our provision for income taxes to
vary significantly from period to period.

         The critical accounting policies discussed are not intended to be a
comprehensive list of all of our accounting policies. In many cases, the
accounting treatment of a particular transaction is specifically dictated by
accounting principles generally accepted in the United States, with no need for
management's judgment in their application. There are also areas in which
management's judgment in selecting any available alternative would not produce a
materially different result.

RECENTLY ISSUED ACCOUNTING STANDARDS

         In December 1999, the Securities and Exchange Commission issued Staff
Accounting Bulletin, or SAB, No. 101 regarding revenue recognition. SAB No. 101
clarifies issues relating to revenue recognition in financial statements
including income statement presentation and disclosure. SAB No. 101 is effective
for us for the fourth fiscal quarter of all years beginning after December 15,
1999. The pre-merger Diagnostics adopted SAB No. 101 on October 1, 2000. The
adoption did not have a material effect on our financial position or results of
operations.

         Effective January 1, 2001, the pre-merger Diagnostics adopted Statement
of Financial Accounting Standards, or SFAS, No. 133, Accounting for Derivative
Instruments and Hedging Activities, which establishes accounting and reporting
standards for derivative instruments, including certain derivative instruments
embedded in other contracts and for hedging activities. All derivatives, whether
designated in hedging relationships or not, are required to be recorded on the
balance
                                     17
<PAGE>

sheet at fair value. If the derivative is designated as a fair value hedge,
then the changes in the fair value of the derivative and of the hedged item
attributable to the hedged risk are recognized in earnings. If the derivative
is designated as a cash flow hedge, then the effective portions of changes in
the fair value of the derivative are recorded in other comprehensive income and
are recognized in the statement of operations when the hedged item affects
earnings. Ineffective portions of changes in the fair value of cash flow hedges
are recognized in earnings. The adoption of SFAS No. 133 did not have an impact
on our financial position or results of operations as we had no derivative
financial instruments during the year ended December 31, 2001.

         Emerging Issues Task Force, or EITF, Issue No. 00-10, "Accounting for
Shipping and Handling Fees and Costs," requires that amounts billed to a
customer related to shipping and handling be classified as revenue, and allows
companies to adopt a policy of including shipping and handling costs in cost of
sales or another statement of operations line item. The pre-merger Diagnostics
adopted EITF Issue No. 00-10 in the fourth quarter of 2000 and elected to report
the costs of shipping and handling in cost of sales. We have retroactively
restated prior quarter and annual amounts to conform to the current
classification resulting in an approximately 1% decrease in gross profit margins
from those previously reported.

         Effective July 1, 2001, we adopted SFAS 141, Business Combinations,
which addresses the financial accounting and reporting for business
combinations. It supersedes Accounting Principles Board, or APB, Opinion No. 16,
Business Combinations, and SFAS 38, Accounting for Pre-acquisition Contingencies
of Purchased Enterprises. All business combinations under the scope of this
statement must be accounted for using the purchase method of accounting. This
statement applies to all business combinations initiated after June 30, 2001.
Our management believes that the adoption of SFAS 141 did not have a material
impact on our financial condition or statement of operations.

         SFAS 142, Goodwill and Other Intangible Assets, addresses financial
accounting and reporting for acquired goodwill and other intangible assets and
supersedes APB Opinion No. 17, Intangible Assets. It addresses accounting for
intangible assets that are acquired individually or with a group of other assets
(other than a business combination) upon acquisition. It also addresses
accounting for goodwill and other intangible assets after they have been
initially recognized in the financial statements. Intangible assets that have
indefinite lives and goodwill will no longer be amortized, but rather they must
be tested at least annually for impairment using fair values. Intangible assets
that have finite useful lives will be amortized over their useful lives. SFAS
142 is effective in fiscal years beginning after December 15, 2001. However,
goodwill and intangible assets acquired after June 30, 2001 will be subject
immediately to the non-amortization and amortization provisions of SFAS 142. On
January 1, 2002 amortization of goodwill acquired prior to June 30, 2001 will
cease. This will increase net income by approximately $255,000 per year.
However, our management is unable to estimate the extent of impairment, if any,
of intangible assets with indefinite lives and goodwill, that may need to be
recorded in 2002 or future years.

         SFAS 143, Accounting for Asset Retirement Obligations, addresses
financial accounting and reporting for obligations associated with the
retirement of tangible long-lived assets and the associated asset retirement
costs. SFAS 143 applies to legal obligations associated with the retirement of
long-lived assets that result from the acquisition, construction, development
and/or normal operation of a long-lived asset, except for certain obligations of
lessees. It requires that the fair value of an asset retirement obligation be
recognized as a liability in the period in which it is incurred if a reasonable
estimate can be made and that the associated retirement costs be capitalized as
part of the carrying amount of the long-lived asset. SFAS 143 is effective for
fiscal years beginning after June 15, 2002. Our management believes that the
impact of adoption of this statement will not have a material impact on the
Company's consolidated financial statements.

                                     18
<PAGE>

         SFAS 144, Accounting for the Impairment or Disposal of Long-lived
Assets, addresses financial accounting and reporting for the impairment or
disposal of long-lived assets. It supersedes SFAS 121, Accounting for the
Impairment of Long Lived Assets and for Long Lived Assets to be Disposed of, and
certain provisions of APB Opinion No. 30, Reporting the Effects of Disposal of a
Segment of a Business and Extraordinary, Unusual and Infrequently Occurring
Events and Transactions, for the disposal of a segment of a business. It also
amends ARB No. 51, Consolidated Financial Statements. SFAS 144 establishes a
single accounting model for the accounting for a segment of a business accounted
for as a discontinued operation that was not addressed by SFAS 121 and resolves
other implementation issues related to SFAS 121. It is effective for fiscal
periods beginning after December 15, 2001. Our management believes that the
impact of adoption of this statement will not be have a material impact on the
Company's consolidated financial statements.

         EITF Issue No. 00-14, "Accounting for Certain Sales Incentives,"
addresses the recognition, measurement and income statement classification for
sales incentives offered voluntarily by a vendor, without charge to the
customer, in a single exchange transaction at the point of sale. In addition to
providing guidance on when to recognize and how to measure the cost of sales
incentives, EITF Issue No. 00-14 requires that incentives in the form of a
reduction in or refund of the selling price of a product or service be
classified as a reduction of revenue. EITF Issue No. 00-14 also requires that
incentives in the form of free products or services delivered at the time of
sale should be classified as an expense. The amended effective date of adoption
is the later of fiscal quarters beginning after March 15, 2001 or fiscal years
beginning after December 15, 1999. The pre-merger Diagnostics elected to adopt
EITF Issue No. 00-14 in the fourth quarter of 2000. The adoption of EITF Issue
No. 00-14 did not have a material impact on our consolidated financial
statements.

CURRENCY FLUCTUATIONS

         For the years ended December 31, 2001, 2000 and 1999, approximately
36.1%, 29.6% and 39.1%, respectively, of our net revenues were generated in
currencies other than the United States dollar. Fluctuations in the value of
foreign currencies relative to the United States dollar affect our reported
results of operations. If the United States dollar weakens relative to the
foreign currency, then our earnings generated in the foreign currency will, in
effect, increase when converted into United States dollars and vice versa.
Exchange rate differences resulting from the strength of the United States
dollar against the euro and the Italian lira resulted in a decline of
approximately $206,000 in net revenues for the year ended December 31, 2001
compared to the same period of the prior year and a decline of $1,031,000 for
the year ended December 31, 2000 compared to the year ended December 31, 1999.
During the three years ended December 31, 2001, none of our subsidiaries were
domiciled in highly inflationary environments. The effects of inflation on
consolidated net revenues and operating income were not significant.

         For the year ended December 31, 2001, Delta represented 55.2% of our
net revenues. Conducting an international business inherently involves a number
of difficulties, risks, and uncertainties, such as export and trade
restrictions, inconsistent and changing regulatory requirements, tariffs and
other trade barriers, cultural issues, longer payment cycles, problems in
collecting accounts receivable, political instability, local economic downturns,
seasonal reductions in business activity in Europe during the traditional summer
vacation months, and potentially adverse tax consequences.

                                     19
<PAGE>

         On January 1, 1999, members of the European Union, including Italy,
introduced a single currency, the euro. During the transition period which ended
January 1, 2002, European Monetary Union, or EMU, countries had the option of
settling transactions in local currencies or in the euro. We have completed our
conversion to the euro. The conversion to the euro has resulted in increased
costs to us related to updating operating systems, reviewing the effect of the
euro on our contracts and updating catalogues and sales materials for our
products. The adoption of the euro will limit the ability of an individual EMU
country to manage fluctuations in the business cycles through monetary policy.

INCOME TAXES

         We recognized a tax provision of $343,000, $1,531,000 and $861,000 for
the three years ended December 31, 2001, 2000 and 1999, respectively, which
related to foreign operations. Through March 14, 2001, we reported our domestic
income taxes as part of a consolidated group with IVAX. All domestic taxable
losses generated prior to that date were utilized by IVAX. Effective March 14,
2001, as a result of the merger, we are no longer included in the consolidated
income tax returns of IVAX.

         For financial statement purposes, we accounted for income taxes on a
stand-alone basis as though we had filed our own income tax returns. Our income
tax provisions for the years ended December 31, 2001, 2000 and 1999 were
different from the amount computed on the loss before provision for income taxes
at the United States federal statutory rate of 35% primarily due to
non-recognition of the benefits of domestic taxable losses discussed above and
non-deductible stock option compensation expense of $1,486,000 in 2001.

         As of December 31, 2001, we had no net domestic deferred tax asset, as
domestic net operating losses generated prior to the merger were utilized by
IVAX and a full valuation allowance has been established against domestic
deferred tax assets generated subsequent to March 14, 2001. The foreign net
deferred tax asset was $625,000 at December 31, 2001 and is included in other
current assets in the accompanying consolidated balance sheet. Realization of
the net deferred tax asset is dependent upon generating sufficient future
foreign taxable income. Although realization is not assured, over time we
believe we will reach levels of profitability which will permit the net deferred
tax asset to be realized.

RISK OF PRODUCT LIABILITY CLAIMS

         Developing, manufacturing and marketing diagnostic test kits, reagents
and instruments subject us to the risk of product liability claims. We believe
that we continue to maintain an adequate amount of product liability insurance,
but there can be no assurance that our insurance will cover all existing and
future claims. There can be no assurance that claims arising under any pending
or future product liability cases, whether or not covered by insurance, will not
have a material adverse effect on our business, results of operations or
financial condition. Our current products liability insurance is a "claims made"
policy.

ITEM 7A.   QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

         Market risk represents the risk of loss that may impact our
consolidated financial position, results of operations or cash flows. In the
normal course of doing business, we are exposed to the risks associated with
foreign currency exchange rates and changes in interest rates.

                                     20
<PAGE>

         Foreign Currency Exchange Rate Risk. We are exposed to exchange rate
risk when our Italian subsidiary enters into transactions denominated in
currencies other than its functional currency. For additional information about
foreign currency exchange rate risk, see "Currency Fluctuations" in our
Management's Discussion and Analysis of Financial Condition and Results of
Operations.

         Interest Rate Risk. We do not have debt obligations. We believe that
our exposure to market risk relating to interest rate risk is not material.

         Commodity Price Risk. We do not believe we are subject to any material
risk associated with commodity prices.

ITEM 8.    FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

                     IVAX Diagnostics, Inc. and Subsidiaries
                   Index to Consolidated Financial Statements

                                                                           Page
                                                                           ----
Report of Independent Certified Public Accountants ................         22

Consolidated Balance Sheets as of December 31, 2001 and 2000.......         23

Consolidated Statements of Operations for each of the three years
        in the period ended December 31, 2001......................         25

Consolidated Statements of Shareholders' Equity for each of the
        three years in the period ended December 31, 2001..........         26

Consolidated Statements of Cash Flows for each of the three years
        in the period ended December 31, 2001......................         27

Notes to Consolidated Financial Statements.........................         28

                                     21
<PAGE>

REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

To The Board of Directors and
   Shareholders of IVAX Diagnostics, Inc.:

We have audited the accompanying consolidated balance sheets of IVAX
Diagnostics, Inc. (a Delaware corporation) and subsidiaries as of December 31,
2001 and 2000, and the related consolidated statements of operations,
shareholders' equity and cash flows for each of the three years in the period
ended December 31, 2001. These financial statements are the responsibility of
the Company's management. Our responsibility is to express an opinion on these
financial statements based on our audits.

We conducted our audits in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of IVAX Diagnostics,
Inc. and subsidiaries as of December 31, 2001 and 2000, and the results of their
operations and their cash flows for each of the three years in the period ended
December 31, 2001 in conformity with accounting principles generally accepted in
the United States.

As explained in Note 2 to the financial statements, IVAX Diagnostics, Inc. and
subsidiaries has given retroactive effect to the change in accounting for
Emerging Issues Task Force No. 00-10, "Accounting for Shipping and Handling Fees
and Costs."

ARTHUR ANDERSEN LLP

Miami, Florida,
March 20, 2002 (except with respect to the matters discussed in the first
paragraph of Note 13, as to which the date is March 21, 2002).

                                     22
<PAGE>

                     IVAX Diagnostics, Inc. and Subsidiaries
                           Consolidated Balance Sheets

<TABLE>
<CAPTION>
                                                                          December 31,
                                                                --------------------------------
                                                                    2001                2000
                                                                -----------          -----------
<S>                                                             <C>                  <C>
 ASSETS
 CURRENT ASSETS:
   Cash and cash equivalents                                    $23,282,155           $1,262,888
   Accounts receivable, net of allowance for doubtful             3,192,782            4,576,916
   accounts of $1,911,395 and $2,202,135,
   respectively
   Inventories                                                    2,857,289            2,693,887
   Deferred income taxes                                            624,770              602,279
   Other current assets                                             803,723              493,764
                                                                -----------          -----------
              Total current assets                               30,760,719            9,629,734
                                                                -----------          -----------
  PROPERTY, PLANT AND EQUIPMENT:
   Land                                                             352,957              352,957
   Buildings and improvements                                     2,353,953            2,257,882
   Machinery and equipment                                        1,543,339            1,486,882
   Furniture and fixtures                                         1,333,162            1,269,508
                                                                -----------          -----------
                                                                  5,583,411            5,367,229
   Less - Accumulated depreciation                               (4,124,709)          (3,828,822)
                                                                -----------          -----------
                                                                  1,458,702            1,538,407
                                                                -----------          -----------
OTHER ASSETS:
   Goodwill, net                                                  6,878,199            7,106,135
   Equipment on lease, net                                          856,439              614,666
   Other                                                            192,469              223,735
                                                                -----------          -----------
                                                                  7,927,107            7,944,536
                                                                -----------          -----------
              Total assets                                      $40,146,528          $19,112,677
                                                                -----------          -----------
</TABLE>

                                      23

The accompanying notes to consolidated financial statements are an integral part
of these balance sheets.
<PAGE>

                    IVAX Diagnostics, Inc. and Subsidiaries
                           Consolidated Balance Sheets
                                  (Continued)

<TABLE>
<CAPTION>
                                                                            December 31,
                                                                 ---------------------------------
                                                                    2001                 2000
                                                                 -----------          ----------
<S>                                                               <C>                  <C>
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
   Accounts payable                                               $ 801,392            $ 769,192
   Accrued expenses                                               2,147,559            2,831,593
                                                                -----------          -----------
              Total current liabilities                           2,948,951            3,600,785
DUE TO PRINCIPAL SHAREHOLDER                                              -            7,961,669
OTHER LONG-TERM LIABILITIES                                         397,674              331,633
                                                                -----------          -----------
              Total liabilities                                   3,346,625           11,894,087
                                                                -----------          -----------
COMMITMENTS AND CONTINGENCIES (Notes 4 and 10)
SHAREHOLDERS' EQUITY:
   Common stock, par value $0.01 per share, authorized
     50,000,000 shares, issued and outstanding
     28,635,652 in 2001 and 20,000,000 in 2000                      286,356              200,000
   Additional paid-in capital                                    44,530,462            11,258,251
   Accumulated deficit                                           (5,596,778)          (2,087,637)
   Accumulated other comprehensive loss                          (2,420,137)          (2,152,024)
                                                                -----------          -----------
              Total shareholders' equity                         36,799,903            7,218,590
                                                                -----------          -----------
              Total liabilities and shareholders' equity        $40,146,528          $19,112,677
                                                                ===========          ===========
</TABLE>

                                     24
The accompanying notes to consolidated financial statements are an integral part
of these balance sheets.
<PAGE>

                     IVAX Diagnostics, Inc. and Subsidiaries
                      Consolidated Statements of Operations

<TABLE>
<CAPTION>

                                                                               For the Year Ended December 31,
                                                                       ----------------------------------------------
                                                                            2001           2000           1999
                                                                          -------         ------         ------
<S>                                                                      <C>            <C>            <C>
NET REVENUES                                                            $10,299,245    $11,793,010    $11,236,779
COST OF SALES                                                             4,854,131      5,379,668      5,324,356
                                                                       ------------    -----------    -----------
              Gross profit                                                5,445,114      6,413,342      5,912,423
                                                                       ------------    -----------    -----------
OPERATING EXPENSES:
   Selling                                                                3,190,580      2,623,738      2,941,791
   General and administrative (See Note 10)                               4,455,040      2,081,602      2,938,217
   Research and development                                               1,418,413      1,291,042      1,216,040
   Goodwill amortization                                                    254,900        255,375        257,770
                                                                        -----------     ----------     ----------
              Total operating expenses                                    9,318,933      6,251,757      7,353,818
                                                                        -----------     ----------     ----------
              Income (loss) from operations                              (3,873,819)       161,585     (1,441,395)
                                                                       ------------    -----------    -----------
OTHER INCOME (EXPENSE):
   Interest income                                                          743,322        157,584        320,210
   Interest expense - related party                                         (93,336)      (525,794)      (506,741)
   Other income (expense), net                                               58,065       (117,407)        22,938
                                                                       ------------    -----------    -----------
              Total other income (expense)                                  708,051       (485,617)      (163,593)
                                                                       ------------    -----------    -----------
              Loss before provision for
                income taxes                                             (3,165,768)      (324,032)    (1,604,988)
PROVISION FOR INCOME TAXES                                                  343,373      1,531,280        861,216
                                                                       ------------    -----------    -----------
              Net loss                                                  $(3,509,141)   $(1,855,312)   $(2,466,204)
                                                                        ===========    ===========    ===========
              Basic and diluted net loss per share                      $      (.13)   $      (.09)   $      (.12)
                                                                        ===========    ===========    ===========
              Basic and diluted weighted average shares outstanding      26,878,722     20,000,000     20,000,000
                                                                        ===========    ===========    ===========
</TABLE>

                                     25
The accompanying notes to consolidated financial statements are an integral part
of these statements.
<PAGE>

                     IVAX Diagnostics, Inc. and Subsidiaries
                 Consolidated Statements of Shareholders' Equity

<TABLE>
<CAPTION>
                                                                           Retained        Accumulated
                                                           Additional      Earnings           Other            Total
                                    Common Stock            Paid-in      (Accumulated     Comprehensive    Shareholders'
                                Shares        Amount        Capital        Deficit)           Loss             Equity
                              ----------     --------     -----------    ------------     -------------    ------------
<S>                           <C>            <C>          <C>            <C>              <C>              <C>
BALANCE, December 31, 1998    20,000,000     $200,000     $11,258,251      $2,233,879      $ (240,227)     $ 13,451,903
  Comprehensive loss:
    Net loss                        -            -              -          (2,466,204)           -           (2,466,204)
    Translation adjustment          -            -              -               -          (1,323,509)       (1,323,509)
                                                                                                           ------------
      Comprehensive loss                                                                                     (3,789,713)
                              ----------     --------     -----------    ------------     -----------      ------------
BALANCE, December 31, 1999    20,000,000      200,000      11,258,251        (232,325)     (1,563,736)        9,662,190
  Comprehensive loss:
    Net loss                        -            -              -          (1,855,312)           -           (1,855,312)
    Translation adjustment          -            -              -                -           (588,288)         (588,288)
                                                                                                           ------------
        Comprehensive loss                                                                                   (2,443,600)
                              ----------     --------     -----------    ------------     -----------      ------------
BALANCE, December 31, 2000    20,000,000      200,000      11,258,251      (2,087,637)     (2,152,024)        7,218,590
  Comprehensive loss:
     Net loss                       -            -               -         (3,509,141)           -           (3,509,141)
     Translation adjustment         -            -               -               -           (268,113)         (268,113)
                                                                                                           ------------
         Comprehensive loss                                                                                  (3,777,254)
   Issuance of common stock    8,621,643       86,216      22,168,891            -               -           22,255,107
   in connection with merger
   Forgiveness of debt to           -            -          9,581,110            -               -            9,581,110
   principal shareholder
   Stock-based compensation         -            -          1,486,488            -               -            1,486,488
   from conversion of stock
   options
   Exercise of stock options      14,009          140          35,722            -               -               35,862
                              ----------     --------     -----------    ------------     -----------      ------------
BALANCE, December 31, 2001    28,635,652     $286,356     $44,530,462    $ (5,596,778)    $(2,420,137)     $ 36,799,903
                              ==========     ========     ===========    ============     ===========      ============
</TABLE>

                                     26
The accompanying notes to consolidated financial statements are an integral part
of these statements.
<PAGE>

                     IVAX Diagnostics, Inc. and Subsidiaries
                      Consolidated Statements of Cash Flows

<TABLE>
<CAPTION>
                                                                                    For the Year Ended December 31,
                                                                          ---------------------------------------------------
                                                                             2001                 2000                 1999
                                                                           -------               ------               ------
<S>                                                                    <C>                  <C>                 <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
   Net loss                                                               $(3,509,141)          $(1,855,312)        $(2,466,204)
   Adjustments to reconcile net loss to net cash
     used in operating activities-
         Depreciation and amortization                                        951,838             1,026,422           1,101,442
         Provision for losses on accounts receivable                           25,256                43,715              68,385
         Stock option compensation expense                                  1,486,488                 -                   -
         Deferred income tax provision                                           -                  136,298             134,997
         Changes in operating assets and liabilities:
           Accounts receivable                                              1,136,708              (601,140)            783,920
           Inventories                                                       (242,661)             (325,663)           (557,040)
           Income taxes receivable                                               -                    -                 611,647
           Other current assets                                              (337,442)               57,312              10,381
           Other assets                                                         6,107                 8,605             (12,676)
           Accounts payable and accrued expenses                             (538,609)              216,606              76,493
           Other long-term liabilities                                         85,214                64,683            (181,913)
                                                                         ------------           -----------         -----------
                Net cash used in operating activities                        (936,242)           (1,228,474)           (430,568)
                                                                         ------------           -----------         -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
   Capital expenditures, net                                                 (241,202)             (149,137)           (118,539)
   Acquisition of equipment on lease                                         (593,045)             (367,530)           (445,181)
                                                                         ------------           -----------         -----------
                Net cash used in investing activities                        (834,247)             (516,667)           (563,720)
                                                                         ------------           -----------         -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
   Proceeds from exercise of stock options                                     35,862                 -                   -
   Proceeds from sale of common stock                                      22,255,107                 -                   -
   Funds received from (paid to) principal shareholder                      1,816,695              (703,056)          4,596,714
                                                                         ------------           -----------         -----------
                Net cash provided by (used in)
                  financing activities                                     24,107,664              (703,056)          4,596,714
                                                                         ------------           -----------         -----------
   EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS              (317,908)             (506,871)         (1,538,412)
                                                                         ------------           -----------         -----------
NET INCREASE (DECREASE) IN CASH AND
   CASH EQUIVALENTS                                                        22,019,267            (2,955,068)          2,064,014
CASH AND CASH EQUIVALENTS, beginning of year                                1,262,888             4,217,956           2,153,942
                                                                         ------------           -----------         -----------
CASH AND CASH EQUIVALENTS, end of year                                    $23,282,155            $1,262,888         $ 4,217,956
                                                                          ===========            ==========         ===========
SUPPLEMENTAL DISCLOSURES:
   Interest paid                                                          $      -               $     -            $      -
                                                                          ===========            ==========         ===========
   Income taxes paid                                                      $   847,073            $  696,200         $   204,430
                                                                          ===========            ==========         ===========
</TABLE>


                                      27
The accompanying notes to consolidated financial statements are an integral part
of these statements.



<PAGE>

                     IVAX Diagnostics, Inc. and Subsidiaries
                   Notes to Consolidated Financial Statements

1   ORGANIZATION AND OPERATIONS

IVAX Diagnostics, Inc. ("IVAX Diagnostics" or the "Company") is a Delaware
corporation and, through its subsidiaries, is engaged in developing,
manufacturing and marketing diagnostic test kits, reagents and instruments for
use in hospitals, reference laboratories, clinical laboratories, research
laboratories, doctors' offices and other commercial companies. The Company's
products and instrumentation are sold primarily to customers in the United
States and Italy.

2   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

      PRINCIPLES OF CONSOLIDATION

The accompanying consolidated financial statements include the accounts of the
Company and its subsidiaries. All significant intercompany balances and
transactions have been eliminated in consolidation.

      USE OF ESTIMATES

The preparation of consolidated financial statements in conformity with
accounting principles generally accepted in the United States requires
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities, the disclosure of contingent assets and liabilities at
the date of the financial statements, and the reported amounts of revenues and
expenses during the reporting period. The Company's actual results in subsequent
periods may differ from the estimates and assumptions used in the preparation of
the accompanying consolidated financial statements. Significant estimates and
assumptions include the allowance for doubtful accounts, inventory reserves,
litigation accruals, product returns, discounts and allowances, warranty
accruals, tax accruals, deferred tax asset valuation allowances and the
realization of long-lived assets.

      RECENTLY ISSUED ACCOUNTING STANDARDS

In December 1999, Securities and Exchange Commission Staff Accounting Bulletin
("SAB") No. 101 regarding revenue recognition was issued. SAB No. 101
clarifies issues relating to revenue recognition in financial statements
including income statement presentation and disclosure. SAB No. 101 is
effective for the Company for the fourth fiscal quarter of all years beginning
after December 15, 1999. As such, the Company adopted SAB No. 101 on October 1,
2000. The adoption did not have a material effect on the Company's financial
position or results of operations.

Effective January 1, 2001, the Company adopted Statement of Financial Accounting
Standards ("SFAS") No. 133, Accounting for Derivative Instruments and Hedging
Activities, which establishes accounting and reporting standards for derivative
instruments, including certain derivative instruments embedded in other
contracts and for hedging activities. All derivatives, whether designated in
hedging relationships or not, are required to be recorded on the balance sheet
at fair value. If the derivative is designated as a fair value hedge, the
changes in the fair value of the derivative and of the hedged item attributable
to the hedged risk are recognized in earnings. If the derivative is designated
as a cash flow hedge, the effective portions of changes in the fair value of the
derivative are recorded in other comprehensive income and are recognized in the
statement of operations when the hedged item affects earnings. Ineffective
portions of changes in the fair value of cash flow hedges are recognized in
earnings. The adoption of SFAS No. 133 did not have an

                                      28





<PAGE>

impact on the Company's financial position or results of operations as the
Company had no derivative financial instruments during the year ended December
31, 2001.

Emerging Issues Task Force ("EITF") Issue No. 00-10, "Accounting for Shipping
and Handling Fees and Costs," requires that amounts billed to a customer related
to shipping and handling be classified as revenue, and allows companies to adopt
a policy of including shipping and handling costs in cost of sales or another
statement of operations line item. The Company adopted EITF Issue No. 00-10 in
the fourth quarter of 2000 and elected to report the costs of shipping and
handling in cost of sales. Prior quarter and annual amounts have been
retroactively restated to conform to the current classification resulting in an
approximately 1% decrease in gross profit margins from those previously
reported.

Effective July 1, 2001, IVAX Diagnostics adopted SFAS 141, Business Combinations
which addresses the financial accounting and reporting for business
combinations. It supersedes Accounting Principles Board ("APB") Opinion No. 16,
Business Combinations and SFAS 38, Accounting for Pre-acquisition Contingencies
of Purchased Enterprises. All business combinations under the scope of this
statement must be accounted for using the purchase method of accounting. This
statement applies to all business combinations initiated after June 30, 2001.
Management believes that adoption of SFAS 141 did not have a material impact on
the Company's financial condition or statement of operations.

SFAS 142, Goodwill and Other Intangible Assets addresses financial accounting
and reporting for acquired goodwill and other intangibles assets and supersedes
APB Opinion No. 17, Intangible Assets. It addresses accounting for intangible
assets that are acquired individually or with a group of other assets (other
than a business combination) upon acquisition. It also addresses accounting for
goodwill and other intangible assets after they have been initially recognized
in the financial statements. Intangible assets that have indefinite lives and
goodwill will no longer be amortized, but rather they must be tested at least
annually for impairment using fair values. Intangible assets that have finite
useful lives will be amortized over their useful lives. The statement is
effective in fiscal years beginning after December 15, 2001. However, goodwill
and intangible assets acquired after June 30, 2001 will be subject immediately
to the non-amortization and amortization provisions of this statement. On
January 1, 2002 amortization of goodwill acquired prior to June 30, 2001 will
cease. This will increase net income by approximately $255,000 per year.
However, management is unable to estimate the extent of impairment, if any, of
intangible assets with indefinite lives and goodwill, that may need to be
recorded in 2002 or future years.

SFAS 143, Accounting for Asset Retirement Obligations, addresses financial
accounting and reporting for obligations associated with the retirement of
tangible long-lived assets and the associated asset retirement costs. It applies
to legal obligations associated with the retirement of long-lived assets that
result from the acquisition, construction, development and/or normal operation
of a long-lived asset, except for certain obligations of lessees. It requires
that the fair value of an asset retirement obligation be recognized as a
liability in the period in which it is incurred if a reasonable estimate can be
made and that the associated retirement costs be capitalized as part of the
carrying amount of the long-lived asset. It is effective for fiscal years
beginning after June 15, 2002. Management believes that the impact of adoption
of this statement will not have a material impact on the Company's consolidated
financial statements.

                                      29

<PAGE>

SFAS 144, Accounting for the Impairment or Disposal of Long-lived Assets,
addresses financial accounting and reporting for the impairment or disposal of
long-lived assets. It supersedes SFAS 121, Accounting for the Impairment of Long
Lived Assets and for Long Lived Assets to be Disposed of, and certain provisions
of APB Opinion No. 30, Reporting the Effects of Disposal of a Segment of a
Business and Extraordinary, Unusual and Infrequently Occurring Events and
Transactions, for the disposal of a segment of a business. It also amends ARB
No. 51, Consolidated Financial Statements. It establishes a single accounting
model for the accounting for a segment of a business accounted for as a
discontinued operation that was not addressed by SFAS 121 and resolves other
implementation issues related to SFAS 121. It is effective for fiscal periods
beginning after December 15, 2001. Management believes that the impact of
adoption of this statement will not have a material impact on the Company's
consolidated financial statements.

EITF Issue No. 00-14, "Accounting for Certain Sales Incentives," addresses the
recognition, measurement and income statement classification for sales
incentives offered voluntarily by a vendor, without charge to the customer, in a
single exchange transaction at the point of sale. In addition to providing
guidance on when to recognize and how to measure the cost of sales incentives,
it requires that incentives in the form of a reduction in or refund of the
selling price of a product or service be classified as a reduction of revenue.
EITF Issue No. 00-14 also requires that incentives in the form of free products
or services delivered at the time of sale should be classified as an expense.
The amended effective date of adoption is the later of fiscal quarters beginning
after March 15, 2001 or fiscal years beginning after December 15, 1999. The
Company elected to adopt EITF Issue No. 00-14 in the fourth quarter of 2000. The
adoption of EITF Issue No. 00.14 did not have a material impact on the Company's
consolidated financial statements.

      CASH AND CASH EQUIVALENTS

The Company considers all investments with an original maturity of three months
or less as of the date of purchase to be cash equivalents.

      INVENTORIES

Inventories are stated at the lower of cost (first-in, first-out) or market.
Components of inventory cost include materials, labor and manufacturing
overhead. In evaluating whether inventory is stated at the lower of cost or
market, management considers such factors as the amount of inventory on hand,
estimated time required to sell such inventory, remaining shelf life and current
market conditions. Reserves are provided as appropriate to reduce excess or
obsolete inventories to the lower of cost or market. Inventories consist of the
following:

                                                  December 31,
                                 ----------------------------------------
                                            2001                2000
                                 -------------------  -------------------
Raw materials                           $ 1,044,346          $ 1,228,781
Work-in-process                             478,860              309,216
Finished goods                            1,334,083            1,155,890
                                          ---------            ---------
     Total                              $ 2,857,289          $ 2,693,887
                                        ===========          ===========

                                     30
<PAGE>

      PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment are carried at cost, less accumulated
depreciation. Depreciation is computed on the straight-line basis over the
estimated useful lives of the assets as follows:

                                                 Years
                                         -------------------
Buildings and                                    5-20
improvements
Machinery and equipment                          3-10
Furniture and fixtures                           3-10

Costs of major additions and improvements are capitalized and expenditures for
maintenance and repairs which do not extend the life of the assets are expensed.
Upon sale or disposition of property, plant and equipment, the cost and related
accumulated depreciation is eliminated from the accounts and any resulting gain
or loss is credited or charged to operations.

Depreciation expense related to property, plant and equipment was $317,304,
$346,839 and $393,800 for the years ended December 31, 2001, 2000 and 1999,
respectively.

      GOODWILL, NET

Cost in excess of net assets of acquired companies (goodwill) is amortized using
the straight-line method over 40 years. Goodwill is reported net of accumulated
amortization and consists of the following:

                                                     December 31,
                                      ----------------------------------------
                                              2001                  2000
                                      -------------------  -------------------
Goodwill                                   $9,236,929             $ 9,219,591
Less - Accumulated
amortization                                2,358,730               2,113,456
                                            ---------               ---------
                                           $6,878,199             $ 7,106,135
                                           ==========             ===========

Amortization expense related to goodwill was $254,900, $255,375 and $257,770 for
the years ended December 31, 2001, 2000 and 1999, respectively.

                                     31

<PAGE>

      EQUIPMENT ON LEASE, NET

The cost of the Company's owned instruments, which are placed under reagent
rental programs at customer facilities for testing and usage of the Company's
products (see Note 2 - Revenue Recognition), less accumulated amortization,
consists of the following:

                                                       December 31,
                                          ----------------------------------
                                                2001               2000
                                          ----------------- ----------------
Equipment on lease at                         $2,759,851        $ 2,227,122
cost
Less - Accumulated                             1,903,412          1,612,456
amortization                                   ---------          ---------
                                                $856,439           $614,666
                                                ========           ========

Equipment on lease is amortized over three years. Amortization expense related
to equipment on lease was $334,754, $396,185 and $427,468 for the years ended
December 31, 2001, 2000 and 1999, respectively.

      REVIEW FOR IMPAIRMENT

The Company continually evaluates whether events and circumstances have occurred
that indicate that the remaining balance of long-lived assets, including
goodwill, may not be recoverable. When factors indicate that goodwill or other
long-lived assets may be impaired, the Company uses various methods to estimate
future cash flow, including current and projected levels of income, business
trends, prospects and market conditions. If the sum of the expected future
undiscounted cash flows is less than the carrying amount of the asset, then an
impairment loss is recognized based on the excess of the carrying amount over
the estimated fair value of the asset. Any impairment amount is charged to
operations.

Future events could cause the Company to conclude that impairment indicators
exist and that long-lived assets, including goodwill, are impaired. Any
resulting impairment loss could have a material adverse impact on our financial
condition and results of operations.

      FOREIGN CURRENCIES

The Company's operations include a subsidiary that is located in Italy. Assets
and liabilities as stated in the local reporting and functional currency are
translated at the rate of exchange prevailing at the balance sheet date. The
gains or losses that result from this process are shown in the "Accumulated
other comprehensive loss" caption in the Shareholders' equity section of the
accompanying consolidated balance sheets. Amounts in the consolidated statements
of operations are translated at the average rates for the period.

The Company is exposed to the risk of currency fluctuation, as a significant
portion of its operations occur in Italy. The Company does not use financial
derivatives to hedge either exchange rates or interest rate fluctuations.

                                     32

<PAGE>

      FINANCIAL INSTRUMENTS

The carrying amounts of cash and cash equivalents, accounts receivable, and
accounts payable approximate fair value due to the short-term maturity of the
instruments and reserves for potential losses, as applicable. The Company does
not speculate in the foreign exchange market.

      REVENUE RECOGNITION

Revenue and the related cost of sales on sales of test kits and instruments are
recognized at the time of shipment. Net revenue is comprised of gross revenue
less provisions for expected product returns, allowances and discounts. These
provisions and discounts totaled $49,540, $14,978 and $34,968 for the years
ended December 31, 2001, 2000 and 1999, respectively.

The Company also owns instruments that it places, under reagent rental programs
common to the industry, for periods of time at customer facilities for testing
and usage with the Company's products ("Equipment on lease"). The instrument
system, utilized by customers to expedite the performance of certain tests, is
paid for over an agreed upon contract period by the purchase of test kits.
Revenue is recognized ratably over the rental period.

Provision for estimated warranty claims are established by the Company
concurrently with the recognition of revenue. Provisions are established in
accordance with accounting principles generally accepted in the United States
based upon consideration of a variety of factors, including actual experience
for products during the past several years by product type, the market for the
product and projected economic conditions. Actual product returns, allowances
and discounts and warranty claims incurred are, however, dependent upon future
events. The Company continually monitors the factors that influence product
returns, allowances and discounts and warranty claims and makes adjustments to
these provisions when management believes that actual amounts may differ from
established reserves.

      RESEARCH AND DEVELOPMENT COSTS

Company sponsored research and development costs related to future products are
expensed currently.

       STOCK-BASED COMPENSATION PLANS

The employees of the Company are eligible to participate in the IVAX 1997
Employee Stock Option Plan as well as the Company's stock option plan. As
permissible under SFAS No. 123, Accounting for Stock-based Compensation, the
Company accounts for all stock-based compensation arrangements using the
intrinsic value method prescribed by APB Opinion No. 25, Accounting for Stock
Issued to Employees, and discloses pro forma net loss and net loss per share
amounts as if the fair value method had been adopted.

                                     33

<PAGE>

      COMPREHENSIVE LOSS

Comprehensive loss, consisting of the sum of net loss and translation
adjustment, was $3,777,254, $2,443,600 and $3,789,713 for the years ended
December 31, 2001, 2000 and 1999, respectively.

      LOSS PER SHARE

Loss per share is computed by dividing net loss by the weighted average number
of common and common equivalent shares outstanding during the period. All
outstanding stock options are considered common stock equivalents. The dilutive
effect, if any, of those options is calculated using the treasury stock method.
Basic and diluted net loss per share are the same for all periods presented. The
number of stock options outstanding not included in the calculation of earnings
per share because their impact is antidilutive was 2,134,128, 1,108,795, and
1,108,795 for the years ended December 31, 2001, 2000 and 1999, respectively.

      RECLASSIFICATIONS

Certain reclassifications have been made to prior year consolidated financial
statements to conform to the current year presentation.

3   MERGER

On March 14, 2001, b2bstores.com, Inc. ("b2bstores.com"), IVAX Corporation
("IVAX" or the "Parent") and IVAX Diagnostics, a wholly-owned subsidiary of
IVAX at that date, consummated a merger (the "Merger") of IVAX Diagnostics into
b2bstores.com pursuant to which all of the issued and outstanding shares of IVAX
Diagnostics were converted into 20,000,000 shares of b2bstores.com stock and
b2bstores.com's name was changed to IVAX Diagnostics, Inc. Prior to the Merger,
b2bstores.com was an internet business services company that was a non-operating
public shell. Net assets of b2bstores.com on the date of Merger were
$22,255,107, consisting primarily of cash of $22,285,064. Additionally, as a
condition of the Merger, intercompany indebtedness of $9,581,110 existing
between IVAX and IVAX Diagnostics was contributed to capital. For accounting
purposes, the Merger was accounted for as sale of stock for cash. The historical
financial statements prior to the acquisition are those of the former IVAX
Diagnostics with retroactive restatement, as if a stock split occurred, to
reflect the 20,000,000 shares of b2bstores.com common stock that IVAX received
in the merger as outstanding for all periods presented. Following the Merger,
IVAX' 20,000,000 shares of IVAX Diagnostics represents approximately 70% of the
issued and outstanding shares of IVAX Diagnostics.

As a result of the Merger, all non-qualified stock options previously granted to
employees of IVAX Diagnostics under the IVAX Diagnostics, Inc. 1999 Stock Option
Plan (Note 8) were converted into non-qualified stock options to purchase
1,108,795 shares of the Company's common stock. As a result of this conversion,
a measurement date was triggered under APB Opinion No. 25, Accounting for Stock
Issued to Employees, and the total non-cash compensation cost of $2,378,364 was
determined. Of this amount, $1,486,488 was recorded in general and
administrative expense in the accompanying statement of operations for the year
ended December 31, 2001. The remaining cost will be expensed and recognized in
additional paid-in capital over the remaining vesting term of the options
through June 30, 2003.

                                     34

<PAGE>

4   CONCENTRATION OF CREDIT RISK

The Company performs periodic credit evaluations of its customers' financial
condition and provides allowances for doubtful accounts as required. One
customer (Sigma Diagnostics) accounted for 3.9% and 40.8% of the Company's net
accounts receivable as of December 31, 2001 and 2000, respectively. The same
customer accounted for 24.9%, 40.1% and 27.8% of the Company's net revenues for
the years ended December 31, 2001, 2000 and 1999, respectively. The customer and
the Company entered into a contract in April 1999, pursuant to which, subject to
terms of the agreement, the customer agreed to purchase minimum levels of the
Company's instrumentation products during the three-year period beginning May 1,
1999. Twice during 2000, the Company's largest customer suspended its purchases
of the Company's products for several months while representatives of the
Company and the customer resolved certain product issues. On January 10, 2001,
shipments to the customer resumed. During the third and fourth quarters of the
year ended December 31, 2001 the customer made no purchases of instrumentation
products based upon the customer's determination that they had an adequate level
of instruments in inventory (See Note 13).

In addition, in October 2000 the customer and the Company entered into a three-
year contract pursuant to which the Company agreed to sell to the customer
certain diagnostic kits under a private-label arrangement. The customer is not
obligated to make a minimum level of purchases under this private-label
arrangement.

The Company's accounts receivables are generated from sales made from both the
United States and Italy. As of December 31, 2001 and 2000, $2,561,948 and
$4,149,874, respectively, of the Company's net accounts receivable were due in
Italy. Of the total net accounts receivable, 66.8% at December 31, 2001 and
44.7% at December 31, 2000 were due from hospitals and laboratories controlled
by the Italian government.

The allowance for doubtful accounts was $1,911,395, $2,202,135 and $2,361,532 at
December 31, 2001, 2000 and 1999, respectively, and activity for the years ended
December 31, 2001, 2000 and 1999 was as follows:

                                         2001           2000          1999
                                         ----           ----          ----

January 1 balance                     $2,202,135    $2,361,532    $2,314,713

Provision for doubtful accounts           25,256        43,715        68,385

Write-offs                              (209,028)           --        (2,032)

Effects of changes in foreign
     exchange rates                     (106,968)     (203,112)      (19,534)
                                     -----------   -----------   -----------
                                      $1,911,395    $2,202,135    $2,361,532
                                     ===========   ===========   ===========

Substantially all cash and cash equivalents are presently held at one national
securities brokerage firm. Accordingly, the Company is subject to credit risk if
this brokerage firm is unable to repay the balance in the account or deliver the
Company's securities or if the brokerage firm should become bankrupt or
otherwise insolvent. The Company only invests in select money market
instruments, municipal securities and corporate issuers.

                                      35

<PAGE>

5   INCOME TAXES

The Company reported its income taxes until March 14, 2001 as part of a
consolidated group with IVAX. For financial statement purposes, the Company
accounts for income taxes on a stand-alone basis as though the Company had filed
its own income tax returns.

The Company accounts for income taxes in accordance with SFAS No. 109,
Accounting for Income Taxes. Under SFAS No. 109, deferred tax assets or
liabilities are computed based upon the difference between the financial
statement and income tax basis of assets and liabilities using the enacted
marginal tax rate applicable when the related asset or liability is expected to
be realized or settled. Deferred income tax expenses or benefits are based on
the changes in the asset or liability from period to period. If available
evidence suggests that it is more likely than not that some portion or all of
the deferred tax assets will not be realized, then a valuation allowance is
required to reduce the deferred tax assets to the amount that is more likely
than not to be realized. Future changes in such valuation allowance would be
included in the provision for deferred income taxes in the period of change. At
December 31, 2001 and 2000, the Company has provided full valuation reserves
against its net domestic deferred tax assets because the Company does not
believe that it is more likely than not that some portion or all of the deferred
tax assets will be realized.

The provision for income taxes consists of the following:

                                          December 31,
                     --------------------------------------------------------
                         2001                  2000                 1999
                     --------------      ---------------      ---------------

Current:
    Foreign              $343,373            $1,394,982            $726,219

Deferred:
    Foreign                     -               136,298             134,997
                         --------               -------             -------

        Total            $343,373            $1,531,280            $861,216
                         ========            ==========            ========

                                     36

<PAGE>

The significant components of net deferred tax asset balances are as follows:

<TABLE>
<CAPTION>
                                                                           December 31,
                                                                  ---------------------------
                                                                       2001          2000
                                                                  -----------     -----------
<S>                                                               <C>             <C>
     Accounts receivable allowances                               $   663,114      $  727,822
     Reserves and accruals                                            358,366         441,335
     Differences in capitalization of inventory costs                  50,068          77,084
     Other                                                             (1,377)              -
     Domestic valuation allowance                                    (445,401)       (643,962)
                                                                  -----------      ----------
          Deferred income taxes                                       624,770         602,279
                                                                  -----------      ----------

     Depreciation and basis differences on fixed assets               207,572         264,865
     Goodwill amortization                                           (241,801)       (204,219)
     Domestic net operating losses                                  1,483,700               -
     Other                                                              1,000           1,000
     Domestic valuation allowance                                  (1,450,471)         (2,135)
                                                                  -----------      ----------
          Amount included in "Other assets"                                 -          59,511
                                                                  -----------      ----------

          Net deferred tax asset                                  $   624,770      $  661,790
                                                                  ===========      ==========
</TABLE>

A reconciliation of the difference between the expected provision for income
taxes using the statutory U.S. Federal tax rate and the Company's actual
provision is as follows:

                                      Year Ended December 31,
                      --------------------------------------------------
                           2001                2000                1999
                      --------------      ---------------    ------------

Benefit for            $(1,108,019)          $(113,411)        $ (561,746)
income taxes
at U.S.
Federal
statutory rate
of 35%

Net impact of            1,338,803             907,559          1,149,905
non-
recognition of
domestic
losses

Effect of                    -                 700,000               -
foreign non-
deductible
expense

Foreign tax                112,589              37,132            273,057
rate                    ----------          ----------           ---------
differential

Provision for             $343,373          $1,531,280           $861,216
income taxes             =========          ==========        ===========

                                     37


<PAGE>

Domestic losses include both non-deductible stock option compensation expense of
$1,486,488 described in Note 3 and non-deductible goodwill amortization of
$178,800 in the year ended December 31, 2001, as well as non-deductible goodwill
amortization of $178,800 in each of the years ended December 31, 2000 and 1999.

As discussed above, the Company has established a full valuation allowance on
its net domestic deferred tax assets, which are primarily comprised of net
operating loss carryforwards. Approximately $746,000 of the valuation allowance
relates to the tax benefit of stock options exercised which has not yet been
credited to additional paid-in capital. The portion of these domestic net
operating loss carryforwards generated prior to March 14, 2001 were utilized by
IVAX. On a separate return basis, no recognition of that utilization is
reflected in the accompanying consolidated financial statements. Net operating
losses generated by the Company after March 14, 2001 are approximately
$4,010,000 and are available for use prior to their expiration in 2021.

United States income taxes have not been provided on undistributed earnings of
foreign subsidiaries, as such earnings are being retained indefinitely by such
subsidiaries for reinvestment. The distribution of these earnings would first
reduce the domestic valuation allowance before resulting in additional United
States income taxes.

6   EMPLOYEE BENEFIT PLAN

Prior to March 14, 2001, the Company's employees within the United States were
eligible to participate in IVAX' 401(k) Retirement Plan, which permits pre-tax
employee payroll contributions (subject to certain limitations) and
discretionary employer matching contributions. Total matching contributions for
the years ended December 31, 2001, 2000 and 1999 were $79,462, $62,990 and
$59,569, respectively. Subsequent to the Merger, the Company established its own
401(k) employee savings plan which also allows for pre-tax employee payroll
contributions and discretionary employer matching contributions. No matching
contributions have been made into this plan.

                                      38

<PAGE>

7   ACCRUED EXPENSES

Accrued expenses consist of the following:

                                                     December 31,
                                          ----------------------------------
                                              2001                 2000
                                          -------------      ---------------
Payroll costs                                 $447,132             $405,080
Taxes                                        1,207,475            1,609,973
Professional fees                              201,870              454,656
Royalties                                      150,000               26,000
Other                                          141,082              335,884
                                          ------------            ---------
                                           $ 2,147,559          $ 2,831,593
                                          ============         ============

8   SHAREHOLDERS' EQUITY

      COMMON STOCK

Concurrent with the approval of the merger discussed in Note 3, the Company
amended its articles of incorporation to increase the number of shares of
authorized common stock from 25,000,000 to 50,000,000.

      PRE-MERGER EMPLOYEE OPTIONS AND STOCK PURCHASE ARRANGEMENTS

In connection with the initial public offering of b2bstores.com, the
underwriters' representatives were issued warrants that expire in February 2005
to purchase up to 400,000 shares of the Company's common stock at a price of
$13.20 per share. As of December 31, 2001, these warrants remain outstanding.

Employees of the Company were eligible to participate in the IVAX 1997 Employee
Stock Option Plan, as amended (the "1997 Plan"), which permits the issuance of
options to employees and consultants to purchase shares of IVAX common stock.
The 1997 Plan provides that the exercise price of the issued options shall be no
less than the fair market value of IVAX' common stock on the date of grant and
that the option terms shall not exceed ten years. Since the approval of the
Company's 1999 Stock Option Plan (discussed below), no option grants have been
made to Company employees from this 1997 Plan. As of December 31, 2001, 86,379
options under the 1997 Plan are held by Company employees at prices ranging from
$4.44 to $14.63, with 58,254 shares exercisable.

Effective June 29, 1999, the Board of Directors of IVAX Diagnostics approved the
Company's 1999 Stock Option Plan (the "1999 Plan"). The 1999 Plan permits the
issuance of options to employees, non-employee directors and consultants of the
Company to purchase up to 2,000,200 shares of the 50,000,000 authorized shares
of common stock of the Company. In June and August of 1999, non-qualified
options for 1,144,909 shares of common stock (as determined below) were granted
with an exercise price of $.73 per share, a vesting schedule of 50% at the end
of year 2 and 25% at the end of years 3 and 4 and expiration dates ranging from
June to

                                     39

<PAGE>

August of 2006. As of December 31, 2001 options for 1,090,795 shares of common
stock were outstanding. No options have been exercised to date under the 1999
Plan.

At the effective time of the merger, automatically and without any action on the
part of an option holder, the surviving company assumed each outstanding option
granted under the 1999 Plan as an option to purchase shares of the surviving
company's common stock under the same terms and conditions as the outstanding
option. The number of shares issuable upon the exercise of an option under the
1999 Plan proportionately increased by multiplying the number of outstanding
options by the exchange ratio of the merger. The exercise price per share was
proportionately decreased by dividing the exercise price by the exchange ratio
of the merger. For the year ended December 31, 2001, non-cash compensation was
recorded as a result of the conversion of the 1999 Plan into non-qualified stock
options to purchase shares of the Company's common stock (See Note 3). For the
years ended December 31, 2000 and 1999, no compensation expense was recorded
related to the 1999 Plan because there has not been an increase in the book
value per share above the $.73 exercise price.

On September 30,1999 the Board of Directors and stockholders of b2bstores.com
approved the 1999 Performance Equity Plan (the "Performance Plan"). The
Performance Plan authorizes the grant of up to 2,000,000 shares of common stock
to key employees, officers, directors and consultants. Both incentive and
non-qualified options may be issued under the Performance Plan. Prior to the
creation of the Performance Plan, options to purchase an additional 1,000,000
shares of common stock were granted by the Board of Directors of b2bstores.com
to selected former officers of that company. As of December 31, 2001, 758,333
options were outstanding from the original grants at prices ranging from $1.81
to $11.50. Following the merger on March 14, 2001, 14,009 options were exercised
under the Performance Plan.

      POST-MERGER STOCK OPTION PLANS

As discussed above, effective June 29, 1999, the Board of Directors of IVAX
Diagnostics approved the Company's 1999 Plan that permits the issuance of
options to employees, non-employee directors and consultants of the Company to
purchase up to 2,000,200 shares of the Company's common stock. These options had
expiration dates ranging from June to August of 2006. As of December 31, 2001
options for 1,090,795 shares of common stock were outstanding. No options have
been exercised to date.

Also discussed above, on September 30, 1999 the Board of Directors and
stockholders of b2bstores.com approved the Performance Plan that authorizes the
grant of up to 2,000,000 shares of common stock to key employees, officers,
directors and consultants. Following the merger on March 14, 2001, 285,000
options granted by the Company were issued under the Performance Plan.

                                     40


<PAGE>

Transactions under the 1999 Plan and Performance Plan for options held by
employees of the Company are summarized as follows:

                                                                    Weighted
                                                                    Average
                                                 Number of          Exercise
                                                  Shares             Price
                                               -------------      -----------
Outstanding at January 1, 1999                         -            $   -
    Granted                                      1,144,909              0.73
    Terminated                                         -                -
                                                ----------
Outstanding at December 31, 1999                 1,144,909              0.73
    Terminated                                     (36,114)             0.73
                                                 ---------
Outstanding at December 31, 2000                 1,108,795              0.73
    Granted                                        285,000              2.99
    Terminated                                     (18,000)             0.73
                                                 ---------
Outstanding at December 31, 2001                 1,375,795              1.19
                                                 =========          ========
Options exercisable at December 31, 2001           580,398          $   0.86
                                                 =========          ========

The Company's pro forma net loss and pro forma weighted average fair value of
options granted, with related assumptions, assuming the Company had adopted the
fair value method of accounting for all stock-based compensation arrangements
consistent with the provisions of SFAS No. 123, using the Black-Scholes option
pricing model, are indicated below for the years ended December 31, 2001, 2000
and 1999.

                                       2001            2000            1999
                                  =============   =============   =============
Net loss as reported              $ (3,509,141)   $ (1,855,312)   $ (2,466,204)
Pro forma net loss                $ (3,758,703)   $ (1,913,498)   $ (2,524,387)
Pro forma basic and diluted
    Loss per share                       (0.14)          (0.10)          (0.13)
Pro forma weighted
    Average fair value
    of options granted                    1.18            0.21            0.21
Expected life (years)                      6.8             7.0             7.0
Risk-free interest rate                    5.0%            5.0%            5.0%
Expected volatility                        128%              0%              0%
Dividend yield                               -               -               -

                                     41

<PAGE>

9    SEGMENT INFORMATION

The Company's management reviews financial information, allocates resources and
manages the business as two segments defined by geographic region. One segment -
the domestic region - contains the Company's subsidiaries in the United States
and corporate operations. The Company's other segment - the Italian region -
contains the Company's subsidiary located in Italy. The information provided is
based on internal reports and was developed and utilized by management for the
sole purpose of tracking trends and changes in the results of the regions. The
information, including the allocations of expense and overhead, was calculated
based on a management approach and may not reflect the actual economic costs,
contributions or results of operations of the regions as stand alone businesses.
If a different basis of presentation or allocation were utilized, the relative
contributions of the regions might differ but the relative trends would, in
management's view, likely not be materially impacted. The table below sets forth
net revenue, income from operations and assets by region.

<TABLE>
<CAPTION>
                                Domestic          Italian         Eliminations         Total
                               ===========      ============      ============     ============
<S>                            <C>              <C>               <C>              <C>
December 31, 2001:
   External net sales          $ 4,615,828      $  5,683,417      $    -           $ 10,299,245
   Intercompany sales              663,874           825,523       (1,489,397)          -
                               -----------      ------------      -----------      ------------
   Net revenue                 $ 5,279,702      $  6,508,940      $(1,489,397)     $ 10,299,245
                               ===========      ============      ============     ============
   Income (loss) from
     Operations                $(4,416,825)     $    667,243      $  (124,237)     $ (3,873,819)
                               ===========      ============      ============     ============
   Assets                      $28,435,144      $ 11,896,562      $  (185,178)     $ 40,146,528
                               ===========      ============      ============     ============
December 31, 2000:
   External net sales          $ 4,144,986      $  7,648,024      $    -           $ 11,793,010
   Intercompany sales              573,377           400,524         (973,901)            -
                               -----------      ------------      ------------     ------------
   Net revenue                 $ 4,718,363      $  8,048,548      $  (973,901)     $ 11,793,010
                               ===========      ============      ============     ============
   Income (loss) from
     Operations                $(2,354,438)     $  2,491,529      $    24,494      $    161,585
                               ===========      ============      ============     ============
   Assets                      $ 4,377,560      $ 14,766,944      $   (31,827)     $ 19,112,677
                               ===========      ============      ============     ============
December 31, 1999:
   External net sales          $ 3,950,767      $  7,286,012      $    -           $ 11,236,779
   Intercompany sales              630,968           429,899       (1,060,867)          -
                               ===========      ============      ============     ============
   Net revenue                 $ 4,581,735      $  7,715,911      $(1,060,867)     $ 11,236,779
                               ===========      ============      ============     ============
   Income (loss) from
     Operations                $(3,193,725)     $  1,807,734      $   (55,404)     $ (1,441,395)
                               ===========      ============      ============     ============
   Assets                      $ 4,205,192      $ 17,534,366      $   (77,800)     $ 21,661,758
                               ===========      ============      ============     ============
</TABLE>

                                      42

<PAGE>

10   COMMITMENTS AND CONTIGENCIES

     LEASES

The Company leases office, plant and warehouse facilities under non-cancellable
operating leases. Rent expense for the years ended December 31, 2001, 2000 and
1999 totaled approximately $230,809, $189,395 and $202,459, respectively. The
future minimum lease payments under non-cancellable capital leases and their
related assets recorded at December 31, 2001 and 2000 were not material. The
future minimum lease payments under non-cancellable operating leases with
initial or remaining terms of one year or more at December 31, 2001, were as
follows:

                                              Operating
                                                Leases
                                              =========
2002                                         $ 211,931
2003                                           187,431
2004                                            78,096
                                              ---------
     Total minimum lease payments            $ 477,458
                                              =========

     LITIGATION, CLAIMS AND ASSESSMENTS

In August of 1996, a company filed a declaratory judgment action seeking to
invalidate certain patents licensed from the Company. A settlement was reached
in favor of the Company in 2000 for $500,000. This amount was received and
recorded by the Company in 2000 as a reduction of general and administrative
expenses.

The Company is involved in various legal claims and actions and regulatory
matters, and other notices and demand proceedings arising in the ordinary course
of business. While it is not feasible to predict or determine the outcome of
these proceedings, in the opinion of management, based on a review with legal
counsel, any losses resulting from such legal proceedings would not have a
material adverse impact on the financial position, results of operations or cash
flows of the Company.

On March 2, 2001, b2bstores.com received notice that a shareholder of
b2bstores.com filed a lawsuit against b2bstores.com and two of its directors.
The lawsuit alleges that b2bstores.com violated certain aspects of Section 14(a)
of the Securities Exchange Act of 1934, as amended, and that certain directors
breached their fiduciary duties in connection with the Merger. The suit seeks
the court's determination of declaratory relief as to whether (i) the proxy
statement materials sent to shareholders should be considered null, void and
unenforceable, (ii) the Merger, if accomplished based on the use of the proxy
materials, should be set aside, and (iii) the termination fee of $1.0 million,
as defined in the Merger Agreement, shall be found void. The directors and
officers of the Company deny the allegations and intend to vigorously defend
such claims, but the ultimate outcome of any such legal proceeding cannot be
determined.

                                     43

<PAGE>

11   RELATED-PARTY TRANSACTIONS

Included in the accompanying consolidated balance sheets as other assets at
December 31, 2001 and as due to principal shareholder at December 31, 2000 are
amounts due to (from) IVAX as follows:

                                                 December 31,
                                        ==========================
                                            2001            2000
                                        ===========    ============
Amounts due to IVAX, unsecured
   and interest bearing                 $   -           $4,144,812
Amounts due to (from) IVAX,
   unsecured and noninterest
   bearing                               (82,000)        3,816,857
                                        -----------    ------------
                                        $(82,000)      $ 7,961,669
                                        ===========    ============

IVAX charged interest, which is included in the accompanying statement of
operations, on the interest bearing advances made prior to March 14, 2001 at
prime plus 1%, which ranged from 8.0% to 9.5% from 1999 to 2001.

Prior to March 14, 2001, IVAX provided administration and funded health care
claims on behalf of the Company and charged the Company a fee reflective of the
cost of service. Additionally, IVAX provided certain legal, treasury, tax,
insurance, payroll and human resource service to the Company for which no fee
was charged to the Company. IVAX is continuing to provide certain services to
the Company under a cost-plus service agreement. No material payments were made
during the period after March 14, 2001.

                                     44

<PAGE>

12   QUARTERLY FINANCIAL INFORMATION (UNAUDITED)

The following tables summarize selected quarterly data of the Company for the
years ended December 31, 2001 and 2000 (in thousands except per share data):

<TABLE>
<CAPTION>
                                                    First       Second      Third       Fourth        Full
                                                   Quarter      Quarter     Quarter     Quarter       Year
                                                  ---------   ---------   ---------    ---------   ----------

<S>                                               <C>         <C>         <C>          <C>         <C>
2001
----
Net revenues                                      $  3,287    $  2,850    $  1,910     $  2,252    $  10,299
Gross profit                                         1,886       1,586         921        1,052        5,445
Loss from operations                                (1,079)       (362)     (1,128)      (1,305)      (3,874)
Net loss                                            (1,320)       (199)       (865)      (1,125)      (3,509)
Basic and diluted loss per share                     (0.05)      (0.01)      (0.03)       (0.04)       (0.13)

2000
----
Net revenues                                      $  3,922    $  2,718    $  3,288     $  1,865    $  11,793
Gross profit                                         2,250       1,420       1,858          885        6,413
Loss from operations                                   832        (223)        335         (782)         162
Net loss                                               243        (525)       (131)      (1,442)      (1,855)
Basic and diluted loss per share                      0.01       (0.03)      (0.01)       (0.07)        (.09)
</TABLE>

13   SUBSEQUENT EVENT

On March 21, 2002, the Company announced that it had signed a non-binding letter
of intent with Sigma Diagnostics, Inc., a wholly-owned subsidiary of Sigma-
Aldrich Corporation, pursuant to which the Company would acquire Sigma
Diagnostics' global enzyme immunoassay product line. The terms of the
transaction are being negotiated and there can be no assurance that the
transaction will be consummated or that the Company will be able to successfully
integrate the acquired product line. Under previous agreements with Sigma
Diagnostics, which are described in Note 4, the Company sold enzyme immunoassay
instrumentation and reagents to Sigma Diagnostics which they marketed throughout
the world. If the proposed acquisition is consummated, reagents or
instrumentation will no longer be sold by the Company to Sigma Diagnostics,
which had been the Company's largest customer for the past three years. Instead,
the Company would sell enzyme immunoassay instrumentation and reagents directly
to Sigma Diagnostics' enzyme immunoassay customer base. If the proposed
acquisition is consummated, our previous agreements with Sigma Diagnostics would
cease and any issues relating to the relationship of the parties would be
resolved. In the event the proposed acquisition is not consummated and Sigma
Diagnostics does not fulfill its obligations under its agreements with the
Company, the Company will review its agreements with Sigma Diagnostics to
determine what remedies, if any, the Company may have. In the event the proposed
acquisition is not consummated, there can be no assurance that the Company will
be able to replace its largest customer or that any remedies will be available
to it in connection with its agreements with Sigma Diagnostics. Any failure to
do so or lack of such remedies would have a material adverse effect on the
Company's business, prospects, operating results, and financial condition.

                                     45

<PAGE>

ITEM 9.    CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
           FINANCIAL DISCLOSURE

         Not applicable.

                                    PART III

ITEM 10.   DIRECTORS AND EXECUTIVE OFFICERS

         The following table sets forth information with respect to our
directors and certain of our executive officers as of March 20, 2002.

Name                             Age                Position
----                             ---                --------

Giorgio D'Urso                   66                 Chief Executive Officer,
                                                    President and Director

Duane M. Steele                  51                 Vice President-Business
                                                    Development

Mark Deutsch                     39                 Chief Financial Officer and
                                                    Vice President-Finance

Phillip Frost, M.D.              65                 Chairman of the Board

Neil Flanzraich                  58                 Director

Jane Hsiao, Ph.D.                54                 Director

John Harley, M.D.                52                 Director

Jack Borsting, Ph.D.             73                 Director

Randall K. Davis                 38                 Director

Jay Raubvogel                    52                 Director

         Set forth below are of the names, ages, positions held and business
experience, including during the past five years, of our directors and certain
of our executive officers as of March 20, 2002. Officers serve at the discretion
of the board of directors. There is no family relationship between any of the
directors or executive officers and there is no arrangement or understanding
between any director or executive officer and any other person pursuant to which
the director or executive officer was selected.

         Mr. Giorgio D'Urso, age 66, has served as our President and Chief
Executive Officer and as a director since the merger and had served in the same
capacities with the pre-merger Diagnostics since 1996. He has served as
President and Chief Executive Officer of Diamedix

                                     46


<PAGE>

since 1993, President of Delta since 1980, and President of ImmunoVision since
1995. He has over 33 years of diagnostics industry experience. Mr. D'Urso
founded Delta, and was its Managing Director from 1980 to 1998. From 1976 to
1980, Mr. D'Urso founded and served as the General Manager of Menarini
Diagnostici, Florence, Italy, a division of Menarini S.A.S. Mr. D'Urso also
founded and supervised Menarini Diagnosticos S.A. in Spain. From 1974 to 1976,
Mr. D'Urso served as the Marketing Manager of the diagnostic division of
SmithKline & French S.P.A. in Milan, Italy. From 1969 to 1974, Mr. D'Urso served
as the Marketing Manager of Laboratori Travenol S.P.A. in Rome, Italy.

         Mr. Duane M. Steele, age 51, has served as our Vice President -
Business Development since the merger and had served in the same capacity with
the pre-merger Diagnostics since 1996. He joined Diamedix in 1995 and has over
25 years of diagnostics industry experience. He has served as the Chief
Operating Officer of Diamedix since 1997. From 1995 to 1997, he served as Vice
President - Business Development of Diamedix. From 1990 to 1994, he served as
President and Chief Executive Officer of LaserCharge, Inc. in Austin, Texas.
From 1988 to 1989, Mr. Steele was the General Manger of Austin Biological
Laboratories, Inc. From 1972 to 1987, Mr. Steele held a variety of positions
with Kallestad Diagnostics, Inc., including Senior Vice President.

         Mr. Mark Deutsch, age 39, has served as Chief Financial Officer and
Vice President - Finance since the merger and had served in the same capacities
with the pre-merger Diagnostics since 1996. He has served as the Vice President
- Finance of Diamedix since 1993 and has 8 years of diagnostics industry
experience. From 1988 to 1993, Mr. Deutsch held various positions including
Accounting Manager of IVAX and Controller of certain subsidiaries of IVAX. From
1985 to 1988, Mr. Deutsch worked for Arthur Andersen & Co. as a Senior
Accountant.

         Dr. Phillip Frost, age 65, has served as Chairman of the Board of
Directors since the merger. He has served as the Chairman of the Board of
Directors and Chief Executive Officer of IVAX since 1987. He served as President
of IVAX from July 1991 until January 1995. He was the Chairman of the Department
of Dermatology at Mt. Sinai Medical Center of Greater Miami, Miami Beach,
Florida from 1972 to 1990. Dr. Frost was Chairman of the Board of Directors of
Key Pharmaceuticals, Inc. from 1972 to 1986. He is Chairman of the Board of
Directors of Whitman Education Group, Inc. (proprietary education), a director
of Northrop Grumman Corp. (aerospace), and a director of Ladenburg Thalmann
Financial Services Inc. (financial services). He is Chairman of the Board of
Trustees of the University of Miami and a member of the Board of Governors of
the American Stock Exchange. Dr. Frost is also a director of the Center for
Blood Research.

         Mr. Neil Flanzraich, age 58, has served as a director since the merger
and had served as a director of the pre-merger Diagnostics since September 1998.
He has served as Vice Chairman and President of IVAX since May 1998 and as a
director of IVAX since 1997. He was a stockholder and served as Chairman of the
Life Sciences Legal Practices Group of Heller Ehrman White & McAuliffe from 1995
to May 1998. From 1981 to 1994, he served in various capacities at Syntex
Corporation (pharmaceuticals), most recently as its Senior Vice President,
General Counsel and a member of the Corporate Executive Committee. From 1994 to
1995, after Syntex Corporation was acquired by Roche Holding Ltd., he served as
Senior Vice President and General Counsel of Syntex (U.S.A.) Inc., a Roche
subsidiary. He is a director of Whitman

                                     47


<PAGE>

Education Group, Inc. (proprietary education) and Continucare Corporation
(integrated health care).

          Dr. Jane Hsiao, age 54, has served as a director since the merger. She
has served as IVAX' Vice Chairman-Technical Affairs since February 1995, as
IVAX' Chief Technical Officer since July 1996, and as Chairman and Chief
Executive Officer of DVM Pharmaceuticals, Inc., IVAX' veterinary products
subsidiary, since March 1998. From 1992 until February 1995, she served as IVAX'
Chief Regulatory Officer and Assistant to the Chairman, and as Vice
President-Quality Assurance and Compliance of Baker Norton Pharmaceuticals,
Inc., IVAX' principal proprietary pharmaceutical subsidiary. From 1987 to 1992,
Dr. Hsiao was Vice President-Quality Assurance, Quality Control and Regulatory
Affairs of Baker Norton Pharmaceuticals, Inc.

          Dr. John Harley, age 52, has served as a director since the merger. He
has held various positions at the University of Oklahoma Health Sciences Center
since 1982. In the Department of Medicine, his positions include Chief of
Rheumatology, Allergy and Immunology Section and Vice Chair for Research, George
Lynn Cross Research Professor (1999 to present). James R. McEldowney Chair in
Immunology and Professor of Medicine (1992 to present), Associate Professor
(1986 to 1992), and Assistant Professor (1982 to 1986). Since 1996 Dr. Harley
has been an Adjunct Professor in the Department of Pathology. In the Department
of Microbiology, Dr. Harley has served as Adjunct Professor (1992 to present),
Adjunct Associate Professor (1988 to 1992), and Adjunct Assistant Professor
(1983 to 1988). Since 1982 Dr. Harley has also been associated with the Oklahoma
Medical Research Foundation's Arthritis and Immunology Program as Program Head
(1999 to present), Member (1998 to present), Associate Member (1989 to present),
Affiliated Associate Member (1986 to 1989), and Affiliated Assistant Member
(1982 to 1986). Dr. Harley has also served as a Staff Physician (1982, to 1984
to 1987 and 1992 to present), and a Clinical Investigator (1987 to 1992),
Immunology Section, Medical Service at the Veterans Administration Medical
Center, Oklahoma City, Oklahoma. In 1981 and 1982, Dr. Harley was a Postdoctoral
Fellow in Rheumatology with the Arthritis Branch of the National Institute of
Arthritis, Diabetes and Digestive and Kidney Diseases, National Institute of
Health, Bethesda, Maryland. He was also a Clinical Associate at the Laboratory
of Immunoregulation, National Institute of Allergy and Infectious Diseases,
National Institutes of Health, Bethesda, Maryland from 1979 to 1982.

          Dr. Jack Borsting, age 73, has served as a director since the merger.
From 1994 to the present, he has served as the E. Morgan Stanley Professor of
Business Administration at the University of Southern California. From 1995 to
2002, Dr. Borsting was the Executive Director of the Center for
Telecommunications Management at the University of Southern California. From
1988 to 1994, he was Dean and Professor of Business Administration at the
University of Southern California, Los Angeles. From 1983 to 1988, he was Dean
of the University of Miami School of Business Administration. Dr. Borsting is a
director of Whitman Education Group, Inc. (proprietary education). Dr. Borsting
is a trustee of the Institute for Defense Analysis, the Rose Hill Foundation and
the Los Angeles Orthopedic Hospital Foundation and MetLife Investors.

          Randall K. Davis, age 38, has served as a director since the merger
and had served as a director of b2bstores prior to the merger since May 2000.
Mr. Davis is the Chairman of the Board, Chief Executive Officer and President of
Titanium Holdings Group, Inc. (formerly known as Enviro-Clean of America, Inc.)
(manufacturer and distributor of janitorial supplies). From May 1985 until July
1999, Mr. Davis was the co-owner, President and Chief Executive

                                      48
<PAGE>

Officer of Cleaning Ideas, Inc., whose holdings included Sanivac, Inc. and Davis
Manufacturing Company (manufacturers of commercial cleaning products).

         Jay Raubvogel, age 52, has served as a director since the merger and
had served as a director of b2bstores prior to the merger since March 2000. Mr.
Raubvogel was the Chief Executive Officer of Baker's Aid, Inc. (food service
equipment manufacturers) from 1985 to 1994. Mr. Raubvogel has been a private
investor. Mr. Raubvogel serves as a trustee of North Shores L.I.J. Health
Systems and Vice-Chairman of its Foundation.

SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

         Section 16(a) of the Securities Exchange Act of 1934 requires our
directors, executive officers and 10% shareholders to file initial reports of
ownership and reports of changes in ownership of common stock and other of our
equity securities with the Securities and Exchange Commission and the American
Stock Exchange. Directors, executive officers and 10% shareholders are required
to furnish us with copies of all Section 16(a) reports they file. Based on a
review of the copies of such reports furnished to us and written representations
from our directors and executive officers that no other reports were required,
we believe that our directors, executive officers and 10% shareholders complied
with all Section 16(a) filing requirements applicable to them for the year ended
December 31, 2001.

ITEM 11.   EXECUTIVE COMPENSATION

EXECUTIVE COMPENSATION

         The following table contains certain information regarding aggregate
compensation paid or accrued by us during 2001, 2000 and 1999 to the Chief
Executive Officer and to each of our other highest paid executive officers other
than the Chief Executive Officer whose total annual salary and bonus exceed
$100,000.

                           SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
                                                                       --------------------------------------------
                                                                                    Long Term Compensation
                               -------------------------------------------------------------------------------------
                               Annual Compensation                               Awards               Payouts
                               -------------------------------------------------------------------------------------

                                                                                Shares
Name and                                                 Other Annual   Restricted    Underlying   Long-Term
Principal                                                Compen-        Stock         Stock        Incentive        All Other
Position           Year         Salary ($)   Bonus ($)   sation ($)     Award(s)($)   Options (#)  Plan Payouts ($) Compensation ($)
------------------------------------------------------------------------------------------------------------------------------------

<S>                <C>          <C>          <C>             <C>          <C>          <C>             <C>            <C>
Giorgio D'Urso     2001/(1)/    $279,770        -            -            -               -            -                   -
Chief Executive    2000         $348,519     $20,000         -            -               -            -                   -
Officer            1999         $348,987     $17,426         -            -            600,000         -              $118,375

Mark Voorhis/(2)/  2001         $ 35,000        -            -            -               -            -              $161,000 /(3)/
Chief Executive    2000             -           -            -            -               -            -                   -
Officer            1999             -           -            -            -               -            -                   -

Duane M. Steele    2001/(4)/    $112,254        -            -            -             50,000         -                   -
Vice President -   2000         $132,824     $18,550         -            -               -            -                   -
Business           1999         $122,237     $ 6,250         -            -            120,000         -                   -
Development
</TABLE>

                                     49

<PAGE>

__________________

*      Value of perquisites and other personal benefits paid does not exceed the
       lesser of $50,000 or 10% of the total annual salary and bonus reported
       for the executive officer.

/(1)/  Does not include $68,749 in salary and $20,000 in bonus paid to
       Mr. D'Urso in 2001 prior to the merger by the pre-merger Diagnostics.

/(2)/  Mr. Voorhis served as the Chief Executive Officer of b2bstores prior to
       the merger.

/(3)/  Mr. Voorhis received $161,000 as a severance payment in connection with
       the merger.

/(4)/  Does not include $27,584 in salary and $18,000 in bonus paid to Mr.
       Steele in 2001 prior to the merger by the pre-merger Diagnostics.

STOCK OPTIONS

         The following table sets forth information concerning stock option
grants made during 2001 to the executive officers named in the "Summary
Compensation Table."

                    STOCK OPTION GRANTS IN FISCAL YEAR 2001

<TABLE>
<CAPTION>
                                                                                                  Potential Realizable Value
                                                                                                  at Assumed Annual Rates of
                                                                                                    Stock Price Appreciation
                                         Individual Grants                                                   for Option Term
                       -----------------------------------------------------------------------------------------------------
                                             % of Total
                       Shares Underlying     Options
                       Stock Options         Granted to     Exercise Price
Name                   Granted (#)           Employees          ($/Sh)           Expiration Date      5%($)          10%($)
----------------------------------------------------------------------------------------------------------------------------

<S>                         <C>                <C>              <C>                <C>              <C>            <C>
Giorgio D'Urso                -                 -                 -                    -               -              -

Mark Voorhis                  -                 -                 -                    -               -              -

Duane M. Steele             50,000             20%              $3.00              March 2008       $61,065        $142,308
</TABLE>

         The following table sets forth information concerning stock option
exercises during 2001 by each of the executive officers named in the "Summary
Compensation Table" and the year-end value of unexercised options held by such
officers and does not include any stock option exercises for shares of IVAX
under the IVAX 1997 Employee Stock Option Plan.

                   STOCK OPTION EXERCISES IN FISCAL YEAR 2001
                        AND FISCAL YEAR-END OPTION VALUES

<TABLE>
<CAPTION>
                                                                    Number of Shares              Value of Unexercised
                                                                    Underlying Unexercised        In-the-Money Stock
                                                                    Stock Options at Fiscal       Options at Fiscal
                                                                    Year-End (#)                  Year-End ($)
                                                                    ----------------------------------------------------------

                      Shares Acquired on
Name                  Exercise (#)            Value Realized ($)    Exercisable   Unexercisable   Exercisable   Unexercisable
------------------------------------------------------------------------------------------------------------------------------

<S>                         <C>                    <C>                <C>            <C>            <C>            <C>
Giorgio D'Urso              -                      -                  300,000        300,000        $825,000       $825,000

Mark Voorhis                -                      -                  183,333           -             $7,666          -

Duane M. Steele             -                      -                   60,000        110,000        $165,000       $189,000
</TABLE>

                                      50

<PAGE>

EMPLOYMENT CONTRACTS AND TERMINATION OF EMPLOYMENT AND CHANGE-IN-CONTROL
ARRANGEMENTS

         On October 1, 1998, the pre-merger Diagnostics entered into a five-year
employment agreement with Giorgio D'Urso, President and Chief Executive Officer,
at a base annual salary of $348,519, with discretionary annual adjustments. We
assumed this employment agreement by operation of law in the merger. Mr.
D'Urso's employment may be terminated with or without cause at any time upon
written notice. For a termination without cause, we must pay Mr. D'Urso his then
current annual base salary in installments for the remainder of the employment
term. While employed by us and for a two-year period thereafter, Mr. D'Urso
cannot employ or contract with any of our current employees or former employees,
except former employees who have not been employed by us for more than one year.

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

         The members of the Compensation and Stock Option Committee of the Board
of Directors are Neil Flanzraich, John Harley, M.D., and Jay Raubvogel.

ITEM 12.   SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

         The following table indicates, as of March 20, 2002, information about
the beneficial ownership of our common stock by (1) each director, (2) each
executive officer named in the "Summary Compensation Table," (3) all directors
and executive officers as a group, and (4) each person who we know beneficially
owns more than 5% of our common stock. All such shares were owned directly with
sole voting and investment power unless otherwise indicated.

<TABLE>
<CAPTION>
                Name                                Shares (#)/(1)/                     Percent of Class (%)
--------------------------------------    ------------------------------------    ----------------------------------

<S>                                              <C>                                           <C>
IVAX Corporation                                 20,000,000                                    69.9%
4400 Biscayne Boulevard
Miami, Florida 33137

Randall K. Davis                                  1,666,833 /(2)/                               5.8%
1023 Morales Street
San Antonio, Texas  78207

Steven Etra                                       1,462,824 /(3)/                               5.1%
5830 57th Street
Maspeth, New York  11378

Giorgio D'Urso                                      315,000 /(4)/                               1.1%

Duane M. Steele                                      60,000 /(5)/                                 *

Mark Deutsch                                         18,000 /(6)/                                 *

Phillip Frost, M.D.                                  39,500 /(7)/                                 *

Neil Flanzraich                                       5,000 /(8)/                                 *

Jane Hsiao, Ph.D.                                     5,000 /(9)/                                 *
</TABLE>

                                      51

<PAGE>

<TABLE>
<S>                                                 <C>                                         <C>
John Harley, M.D.                                     5,000/(10)/                                 *

Jack Borsting, Ph.D.                                  5,500/(11)/                                 *

Jay Raubvogel                                       190,000/(12)/                                 *

Mark Voorhis                                        183,333/(13)/                                 *

All directors and executive
    officers as a group (11
    persons)                                         2,493,166                                  8.7%
</TABLE>

________________________

*        Represents beneficial ownership of less than 1%.

/(1)/    For purposes of this table, beneficial ownership is computed pursuant
         to Rule 13d-3 under the Securities Exchange Act of 1934.

/(2)/    Includes (a) options for 105,000 shares of common stock granted to
         Mr. Davis and (b) 1,288,500 shares of common stock owned by Titanium
         Holdings Group, Inc. (formerly known as Enviro-Clean of America, Inc.),
         a corporation in which Mr. Davis serves as the Chairman of the Board,
         Chief Executive Officer and President. In a filing with the SEC, Mr.
         Davis disclaimed beneficial ownership of the securities held by
         Titanium Holdings Group, Inc., except to the extent of his pecuniary
         interest.

/(3)/    Includes (a) 10,667 shares of common stock owned by SRK Associates
         L.L.C., a company controlled by Mr. Etra, (b) 1,000 shares of common
         stock owned by Lances Property Development Pension Plan, which is 50%
         owned by Mr. Etra, (c) 1,228,500 shares of common stock owned by
         Titanium Holdings Group, Inc. (formerly known as Enviro-Clean of
         America, Inc.), a corporation in which Mr. Etra is a shareholder and a
         director, and (d) 3,500 shares of common stock owned by Gemini Capital
         L.L.C., a company in which Mr. Etra is the Secretary, a director and a
         shareholder. In a filing with the SEC, Mr. Etra disclaimed beneficial
         ownership of the securities held by SRK Associates L.L.C., Lances
         Property Development Pension Plan, Titanium Holdings Group, Inc., and
         Gemini Capital L.L.C., except to the extent of his pecuniary interest.

/(4)/    Includes options for 300,000 shares of common stock granted to
         Mr. D'Urso.

/(5)/    Includes options for 60,000 shares of common stock granted to
         Mr. Steele.

/(6)/    Includes options for 18,000 shares of common stock granted to
         Mr. Deutsch.

/(7)/    Includes (a) options for 5,000 shares of common stock granted to Dr.
         Frost and (b) 34,500 shares of common stock owned by Frost Gamma LP, a
         limited partnership in which Dr. Frost is the sole limited partner and
         in which Dr. Frost is the sole shareholder of Frost - Nevada Corp., the
         sole shareholder of Frost Gamma, Inc., the general partner. Does not
         include any securities owned by IVAX Corporation, a corporation in
         which Dr. Frost is the Chairman of the Board and Chief Executive
         Officer, and Dr. Frost disclaims beneficial ownership of securities
         held by IVAX Corporation.

                                      52

<PAGE>

/(8)/    Includes options for 5,000 shares of common stock granted to
         Mr. Flanzraich.

/(9)/    Includes options for 5,000 shares of common stock granted to
         Dr. Hsiao.

/(10)/   Includes options for 5,000 shares of common stock granted to
         Dr. Harley.

/(11)/   Includes options for 5,000 shares of common stock granted to
         Dr. Borsting.

/(12)/   Includes options for 150,000 shares of common stock granted to
         Mr. Raubvogel.

/(13)/   Includes options for 183,333 shares of common stock granted to
         Mr. Voorhis.

ITEM 13.   CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

         Upon completion of the merger, we entered into a registration rights
agreement with IVAX that requires us to file a registration statement on Form
S-3 (at any time after one year, and before the earlier of five years following
the completion of the merger or such time at which all the shares of our common
stock owned by IVAX can be sold in any three-month period without registration)
to register not less than $1.0 million of our common stock owned by IVAX.
Additionally, IVAX may "piggyback" on registrations initiated by us or other
holders exercising similar demand registration rights. We may delay the filing
of any registration statement for 120 days if we determine in good faith that
to effect such registration statement would be detrimental to us or our
stockholders. We have agreed to pay all fees and expenses in connection with
such registrations, except for any underwriting discounts and commissions. If
we file a registration statement in connection with an underwritten offering,
IVAX has agreed to sign a customary underwriting agreement in connection with
such registration and its rights to register shares is subject to a proration
provision if the underwriters determine that the success of the offering will
be jeopardized from too many shares being included in the offering. Shares to
be sold by us on any registered offering will be included prior to the
inclusion of any other shares of our common stock held by IVAX. The
registration rights agreement also contains customary mutual indemnification
and market stand-off provisions. IVAX can assign or transfer its rights under
the registration rights agreement.

         In connection with the merger, we entered into a shared services
agreement with IVAX pursuant to which IVAX would continue to provide
administrative and management services previously provided by IVAX to the
pre-merger Diagnostics prior to the merger at IVAX' cost plus 15% for a period
of three months. These services include payroll, including printing paychecks
and making associated tax filings; treasury, including cash management services
such as disbursements, receipts, banking and investing; insurance, including
procuring and administering policies; human resources, including administering
employee benefits and plans; financial reporting, including public reports,
income taxes; and information systems, including network and website hosting,
phone and data systems, software licenses and information systems support.

         In connection with the merger, we entered into a use of name license
with IVAX that grants us a non-exclusive, royalty free license to use the name
"IVAX." The license was not terminable by IVAX for a one-year period. After the
first year, IVAX may terminate the license upon 90 days' written notice. Upon
termination of the agreement, we must take all steps

                                      53

<PAGE>

reasonably necessary to change our name as soon as is practicable. If IVAX
abandons its use of the name, IVAX must transfer all rights to the name to us.
The termination of this agreement by IVAX could have a material adverse affect
on our ability to market our products and on us.

         Giulio D'Urso, the son of our Chief Executive Officer and President,
has been engaged by our subsidiaries and us for annual compensation of $120,000.

                                     PART IV

ITEM 14.   EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K

(a)      DOCUMENTS FILED AS PART OF THIS ANNUAL REPORT ON FORM 10-K:

         (1)     FINANCIAL STATEMENTS

                 The following consolidated financial statements of IVAX
                 Diagnostics, Inc. and its subsidiaries are included in Part II,
                 Item 8 of this Annual Report on Form 10-K:

                      Report of Independent Certified Public Accountants

                      Consolidated Balance Sheets as of December 31, 2001 and
                      2000

                      Consolidated Statements of Operations for each of the
                      three years in the period ended December 31, 2001

                      Consolidated Statements of Shareholders' Equity for each
                      of the three years in the period ended December 31, 2001

                      Consolidated Statements of Cash Flows for each of the
                      three years in the period ended December 31, 2001

                      Notes to Consolidated Financial Statements

         (2)     FINANCIAL STATEMENT SCHEDULES

                 Schedules have been omitted because the required information is
                 not applicable or the information is included in the
                 consolidated financial statements or the notes thereto.

                                      54
<PAGE>

         (3)     EXHIBITS

                 The following exhibits are either filed as a part of this
                 Annual Report on Form 10-K or are incorporated into this
                 Annual Report on Form 10-K by reference to documents previously
                 filed as indicated below:

<TABLE>
<CAPTION>
Exhibit
Number          Description                                              Method of Filing
------          -----------                                              ----------------
<S>             <C>                                                      <C>
3.1(a)          Certificate of Incorporation                             Incorporated by reference to our Form SB-2
                                                                         dated October 6, 1999.

3.1(b)          Certificate of Amendment to Certificate of               Incorporated by reference to our Form
                Incorporation                                            SB-2/A dated December 2, 1999.

3.1(c)          Certificate of Merger                                    Filed herewith.

3.2             Amended and Restated Bylaws                              Filed herewith.

4.1             Specimen Common Stock Certificate                        Filed herewith.

4.2             Form of Representatives'  Warrant Agreement and Form     Incorporated by Reference to our Form
                of Representatives' Warrant Certificate                  SB-2/A dated January 26, 2000.

4.3             Registration Rights Agreement, dated March 14,           Filed herewith.
                2001, between IVAX Diagnostics, Inc. and IVAX
                Corporation

10.1            Merger Agreement, dated November 21, 2000, between       Incorporated by reference to our Schedule
                IVAX Corporation, IVAX Diagnostics, Inc. and             14A dated January 30, 2001.
                b2bstores.com Inc.

10.2            Distributor Agreement, dated October 12, 2000,           Filed herewith.
                between IVAX Diagnostics, Inc. and Sigma
                Diagnostics, Inc.

10.3            Distributorship Agreement, dated April 26, 1999,         Filed herewith.
                between IVAX Diagnostics, Inc. and Sigma
                Diagnostics, Inc.

10.4            Consulting Agreement, dated September 1, 1999,           Filed herewith.
                between IVAX Diagnostics, Inc. and Mario Cossi

10.5            Assignment and Royalty Agreement, dated December         Filed herewith.
                12, 1994, between Diamedix Corporation, Mario Cossi
                and Riccardo Cossi, as amended as of February 1,
                1997, September 1, 1999, and February 15, 2001

10.6            Use of Name License Agreement, dated March 14,           Filed herewith.
                2001, between IVAX Diagnostics, Inc. and IVAX
                Corporation

10.7            Shared Services Agreement, dated March 14, 2001,         Filed herewith.
                between IVAX Diagnostics, Inc. and IVAX Corporation

10.8            Employment Agreement, dated October 1, 1998,             Filed herewith.
                between IVAX Diagnostics, Inc. and Giorgio D'Urso

10.9            1999 Performance Equity Plan                             Incorporated by reference to our Form SB-2
                                                                         dated October 6, 1999.

10.10           1999 Stock Option Plan                                   Filed herewith.

21.1            Subsidiaries of IVAX Diagnostics, Inc.                   Filed herewith.

23.1            Consent of Arthur Andersen LLP                           Filed herewith.

99.1            Letter to Securities and Exchange Commission             Filed herewith.
                Regarding Arthur Andersen LLP
</TABLE>

                                      55


<PAGE>

(b)      REPORTS ON FORM 8-K

         We did not file any reports on Form 8-K during the quarter ended
         December 31, 2001.

                                      56

<PAGE>

                                   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.

                                                      IVAX DIAGNOSTICS, INC.

Dated:  April 1, 2002                                 By: /s/ Giorgio D'Urso
                                                          ------------------
                                                       Giorgio D'Urso
                                                       Chief Executive Officer
                                                       and President

         Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.

<TABLE>
<CAPTION>
Name                                      Capacity                                               Date
----                                      --------                                               ----
<S>                                       <C>                                               <C>
/s/ Giorgio D'Urso                        Chief Executive Officer,                          April 1, 2002
------------------------                  President and Director
Giorgio D'Urso                            (Principal Executive Officer)

/s/ Mark Deutsch                          Chief Financial Officer                           April 1, 2002
------------------------                  and Vice President-Finance
Mark Deutsch                              (Principal Financial Officer)
                                          (Principal Accounting Officer)

/s/ Phillip Frost, M.D.                   Chairman of the Board                             April 1, 2002
------------------------                  of Directors
Phillip Frost, M.D.

/s/ Neil Flanzraich                       Director                                          April 1, 2002
------------------------
Neil Flanzraich

/s/ Jane Hsiao, Ph.D.                     Director                                          April 1, 2002
------------------------
Jane Hsiao, Ph.D.

/s/ John Harley, M.D.                     Director                                          April 1, 2002
------------------------
John Harley, M.D.

/s/ Jack Borsting, Ph.D.                  Director                                          April 1, 2002
------------------------
Jack Borsting, Ph.D.

/s/ Randall K. Davis                      Director                                          April 1, 2002
------------------------
Randall K. Davis

/s/ Jay Raubvogel                         Director                                          April 1, 2002
------------------------
Jay Raubvogel
</TABLE>

                                      57

<PAGE>

                                 EXHIBIT INDEX

<TABLE>
<CAPTION>
Exhibit
Number                           Description
------                           -----------
<S>                              <C>
3.1(c)                           Certificate of Merger

3.2                              Amended and Restated Bylaws

4.1                              Specimen Common Stock Certificate

4.3                              Registration Rights Agreement, dated March 14, 2001, between IVAX
                                 Diagnostics, Inc. and IVAX Corporation

10.2                             Distributor Agreement, dated October 12, 2000, between IVAX
                                 Diagnostics, Inc. and Sigma Diagnostics, Inc.

10.3                             Distributorship Agreement, dated April 26, 1999, between IVAX
                                 Diagnostics, Inc. and Sigma Diagnostics, Inc.

10.4                             Consulting Agreement, dated September 1, 1999, between IVAX
                                 Diagnostics, Inc. and Mario Cossi

10.5                             Assignment and Royalty Agreement, dated December 12, 1994,
                                 between Diamedix Corporation, Mario Cossi and Riccardo Cossi, as
                                 amended as of February 1, 1997, September 1, 1999, and February 15,
                                 2001

10.6                             Use of Name License Agreement, dated March 14, 2001, between IVAX
                                 Diagnostics, Inc. and IVAX Corporation

10.7                             Shared Services Agreement, dated March 14, 2001, between IVAX
                                 Diagnostics, Inc. and IVAX Corporation

10.8                             Employment Agreement, dated October 1, 1998, between IVAX
                                 Diagnostics, Inc. and Giorgio D'Urso

10.10                            1999 Stock Option Plan

21.1                             Subsidiaries of IVAX Diagnostics, Inc.

23.1                             Consent of Arthur Andersen LLP

99.1                             Letter to Securities and Exchange Commission Regarding Arthur
                                 Andersen LLP
</TABLE>

                                      58