UNITED
STATESSECURITIES AND EXCHANGE COMMISSION


Washington,
DC 20549







FORM
10-Q











QUARTERLY
REPORT UNDER SECTION 13 OR 15 (d) OF THE


SECURITIES
EXCHANGE ACT OF 1934








For the quarterly
period ended:March 31,
2008








Commission
file No. 333-90738







Biomoda,
Inc.


(Name of
registrant as specified in its charter)









New
      Mexico
            85-0392345(State of
      incorporation)
            (IRS Employer
      Identification No.)P.O. Box 11342,Albuquerque,New
      Mexico
            87192(Address of
      principal executive offices)
            (Zip
      code)




Issuer's
telephone number: (505)
821-0875





Check
whether the issuer (1) 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
o





Indicate
by check mark whether the registrant is a large accelerated filer, and
accelerated filer, a non-accelerated filer, or a smaller reporting
company.  See the definitions of “large accelerated filer,”
“accelerated filer” and “smaller reporting company” in Rule 12b-2 of the
Exchange Act.




Large
accelerated filer   ̈                                                                Accelerated
filer   ̈


Non-accelerated
filer   ̈                                                                Smaller
reporting company  x





Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act) Yes o  No x





The
number of issuer’s shares of Common Stock outstanding as of May 14, 2008 was
76,321,164.








Table of Contents








TABLEOF CONTENTS





PART
      I.
              Financial InformationItem
      1.
              Financial Statements
              3Item
      2.
              Management's Discussion and Analysis of Financial Condition and
      Results of Operations
              7Item
      3.
              Quantitative and Qualitative Disclosures About Market
      Risk
              9Item
      4.
              Controls and Procedures
              9PART
      II.
              Other InformationItem
      1.
              Legal Proceedings
              10Item
      2.
              Unregistered Sales of Equity Securities and Use of
      Proceeds
              10Item
      3.
              Defaults Upon Senior Securities
              10Item
      4.
              Submission of Matters to a Vote of Security
      Holders
              10Item
      5.
              Other Information
              10Item
      6.
              Exhibits
              10Signatures




Table of Contents







PART
I: FINANCIALINFORMATION





Forward
- Looking Statements




This Form
10-Q contains forward-looking statements about the business, financial condition
and prospects of the Company that reflect assumptions made by management and
management's beliefs based on information currently available to it. We can give
no assurance that the expectations indicated by such forward-looking statements
will be realized. If any of management's assumptions should prove incorrect, or
if any of the risks and uncertainties underlying such expectations should
materialize, our actual results may differ materially from those indicated by
the forward-looking statements.





The key
factors that are not within our control and that may have a direct bearing on
operating results include, but are not limited to, the acceptance by customers
of our products, our ability to develop new products cost-effectively, the
ability of us to raise capital in the future, the development by competitors of
products using improved or alternative technology, the retention of key
employees and general economic conditions.





There may
be other risks and circumstances that management is unable to predict. When used
in this Form 10-Q, words such as, "believes," "expects," "intends," "plans,"
"anticipates" "estimates" and similar expressions are intended to identify
forward-looking statements, although there may be certain forward-looking
statements not accompanied by such expressions. All forward-looking statements
are intended to be covered by the safe harbor created by Section 21E of the
Securities Exchange Act of 1934.








Table of Contents




Item1:  FINANCIAL STATEMENTS





BIOMODA,
      INC. AND SUBSIDIARY(A
      DEVELOPMENT STAGE COMPANY)CONSOLIDATED
      BALANCE SHEETS(UNAUDITED)






March
      31,
            
            
            December
      31,2008
            
            
            2007ASSETSCurrent
      AssetsCash
            
            $
            670,908
            
            
            $
            479,800Prepaid
      expenses
            
            
            4,874
            
            
            
            3,241Total
      Current Assets
            
            
            675,782
            
            
            
            483,041Patents,
      net of accumulated amortization of $244,419 and
    $232,556
            
            
            103,905
            
            
            
            102,546Property
      and Equipment, net of accumulated depreciation of $13,897 and
      $12,642
            
            
            18,897
            
            
            
            4,794Total
      Assets
            
            $
            798,226
            
            
            $
            590,381LIABILITIES
      AND STOCKHOLDERS' DEFICITCurrent
      LiabilitiesAccounts
      payable and accrued liabilities
            
            $
            221,077
            
            
            $
            248,241Advances
      from stockholders
            
            
            189,613
            
            
            
            184,989Short-term
      debt
            
            
            81,635
            
            
            
            111,635Line
      of credit from an affiliated entity
            
            
            1,052,778
            
            
            
            1,070,529Total
      Current Liabilities
            
            
            1,545,103
            
            
            
            1,615,404Commitments
      and ContingenciesStockholders'
      DeficitClass
      A redeemable preferred stock; no par value 2,000,000 shares authorized;
      cumulative and convertible; liquidation and redemption values of
      $1.50 and $1.80 per share; no shares issued and
      outstanding
            
            
            -
            
            
            
            -Undesignated
      preferred stock; 2,000,000 shares authorized; no shares issued and
      outstanding
            
            
            -
            
            
            
            -Common
      stock, no par value, 100,000,000 shares authorized; 74,968,022 and
      48,315,983 issued and outstanding
            
            
            7,413,096
            
            
            
            6,199,585Treasury
      stock, at cost 60,000 shares
            
            
            (9,000
            )
            
            
            (9,000
            )Deficit
      accumulated during development stage
            
            
            (7,880,973
            )
            
            
            (7,215,608
            )Total
      Stockholders' Deficit
            
            
            (746,877
            )
            
            
            (1,025,023
            )TotalLiabilities And Stockholders' Deficit
            
            $
            798,226
            
            
            $
            590,381





See notes
to consolidated financial statements.
   3
 Table of Contents





BIOMODA,
      INC. AND SUBSIDIARY(A
      DEVELOPMENT STAGE COMPANY)CONSOLIDATED
      STATEMENTS OF OPERATIONS(UNAUDITED)




For
      the Three Months Ended March 31,
            
            
            January
      3, 1990 (Inception) to March 31,2008
            
            
            2007
            
            
            2008Revenue
            
            $
            -
            
            
            $
            -
            
            
            $
            23Operating
      expensesProfessional
      fees
            
            
            89,063
            
            
            
            89,300
            
            
            
            895,847General
      and administrative
            
            
            395,477
            
            
            
            1,109,938
            
            
            
            3,763,300Research
      and development
            
            
            153,255
            
            
            
            471,807
            
            
            
            2,786,874Depreciation
      and amortization
            
            
            13,118
            
            
            
            5,189
            
            
            
            260,931Total
      Operating Expenses
            
            
            650,913
            
            
            
            1,676,234
            
            
            
            7,706,952Loss
      from operations
            
            
            (650,913
            )
            
            
            (1,676,234
            )
            
            
            (7,706,929
            )Other
      Income (Expenses)Gain
      on forgiveness of debt
            
            
            -
            
            
            
            -
            
            
            
            282,103Other
      income
            
            
            
            
            
            
            
            
            
            
            33,919Interest
      income
            
            
            -
            
            
            
            -
            
            
            
            3,870Interest
      expense
            
            
            (14,452
            )
            
            
            (19,196
            )
            
            
            (493,936
            )Total
      Other Expenses
            
            
            (14,452
            )
            
            
            (19,196
            )
            
            
            (174,044
            )Loss
      Before Provision For Income Taxes
            
            
            (665,365
            )
            
            
            (1,695,430
            )
            
            
            (7,880,973
            )Provision
      for income taxes
            
            
            -
            
            
            
            -
            
            
            
            -Net
      Loss
            
            $
            (665,365
            )
            
            $
            (1,695,430
            )
            
            $
            (7,880,973
            )Basic
      and diluted weighted average number of common shares
      outstanding
            
            
            59,518,759
            
            
            
            9,476,126Basic
      and diluted loss per common share
            
            $
            (0.01
            )
            
            $
            (0.18
            )





See notes
to consolidated financial statements.


4
 Table of Contents





BIOMODA,
      INC. AND SUBSIDIARY(A
      DEVELOPMENT STAGE COMPANY)CONSOLIDATED
      STATEMENTS OF CASH FLOWS(UNAUDITED)






Three
      Months Ended
              March
      31,
            
            
            January
      3, 1990 (Inception) to
              March
      31,2008
            
            
            2007
            
            
            2008CASH
      FLOWS FROM OPERATING ACTIVITIESNet
      loss
            
            $
            (665,365
            )
            
            $
            (268,763
            )
            
            $
            (7,874,079
            )Adjustments to
      reconcile net loss to net cash used in operating
      activities:Stock
      based compensation
            
            
            266,293
            
            
            
            793,991
            
            
            
            2,834,679Write-off
      of license fee
            
            
            
            
            
            
            
            
            
            
            1,250Loss
      on sale of assets
            
            
            -
            
            
            
            -
            
            
            
            358Foreign
      currency transactions
            
            
            -
            
            
            
            -
            
            
            
            3,247Non-cash
      gain on debt settlement
            
            
            -
            
            
            
            -
            
            
            
            (240,239
            )Depreciation
      and amortization
            
            
            13,118
            
            
            
            5,191
            
            
            
            254,534Changes
      in operating assets and liabilities:Accounts
      receivable
            
            
            -
            
            
            
            -
            
            
            
            (7,620
            )Other
      Assets
            
            
            (1,633
            )
            
            
            -
            
            
            
            2,746Accounts
      payable and accrued liabilities
            
            
            (27,174
            )
            
            
            46,686
            
            
            
            800,920Net
      cash flows used in operating activities
            
            
            (414,761
            )
            
            
            (849,562
            )
            
            
            (4,224,204
            )CASH
      FLOWS FROM INVESTING ACTIVITIESPurchase
      of property and equipment
            
            
            (15,000
            )
            
            
            -
            
            
            
            (40,571
            )Sale
      of property and equipment
            
            
            -
            
            
            
            -
            
            
            
            1,139Organizational
      costs
            
            
            -
            
            
            
            -
            
            
            
            (560
            )Patent,
      trademark and license fee
            
            
            (13,222
            )
            
            
            (1,801
            )
            
            
            (365,322
            )Net
      cash flows used in investing activities
            
            
            (28,222
            )
            
            
            (1,801
            )
            
            
            (405,314
            )CASH
      FLOWS FROM FINANCING ACTIVITIESProceeds
      from stockholders' advances
            
            
            4,624
            
            
            
            4,155
            
            
            
            150,203Proceeds
      from line of credit from an affiliated entity
            
            
            9,828
            
            
            
            847,073
            
            
            
            2,662,007Repayments
      on line of credit from an affiliated entity
            
            
            (27,579
            )
            
            
            -
            
            
            
            (299,579
            )Repayments
      of Short-term debt
            
            
            (30,000
            )
            
            
            
            
            
            
            (68,000
            )Acquisition
      of treasury stock
            
            
            -
            
            
            
            -
            
            
            
            (9,000
            )Issuance
      of common stock for cash
            
            
            677,218
            
            
            
            1,000
            
            
            
            2,864,795Net
      cash flows provided by financing activities
            
            
            634,091
            
            
            
            852,228
            
            
            
            5,300,426Net
      increase(decrease) in cash
            
            
            191,108
            
            
            
            (865
            )
            
            
            670,908Cash,
      beginning of period
            
            
            479,800
            
            
            
            116
            
            
            
            -Cash,
      end of period
            
            $
            670,908
            
            
            $
            981
            
            
            $
            670,908Supplemental
      cash flow information:Cash
      paid for :Interest
            
            $
            -
            
            
            $
            -
            
            
            $
            -Income
      Taxes
            
            $
            -
            
            
            $
            -
            
            
            $
            -Non-cash
      investing and financing activities:Accrued
      salaries converted to notes payable
            
            $
            -
            
            
            $
            -
            
            
            $
            479,484Interest
      converted to note payable
            
            $
            -
            
            
            $
            -
            
            
            $
            149,635Common
      stock issued to extinguish related party debt
            
            $
            -
            
            
            $
            -
            
            
            $
            1,418,768





See notes
to consolidated financial statements.
   5
 Table of Contents


_____________________________________________


BIOMODA,
INC.


(A
Development Stage Company)


NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS


(Unaudited)


______________________________________________


1.  BASIS
OF PRESENTATION





The
accompanying unaudited interim financial statements of Biomoda, Inc. have been
prepared in accordance with accounting principles generally accepted in the
United States of America for interim financial information and with the
instructions to Form 10-Q. Accordingly, they do not include all of the
information and notes required by generally accepted accounting principles for
complete financial statements and should be read in conjunction with the
Management's Discussion and Analysis and the audited financial statements and
notes thereto contained in our 2007 Annual Report filed with the Securities and
Exchange Commission on Form 10-KSB. In the opinion of management, all
adjustments, consisting of normal recurring adjustments, necessary for a fair
presentation of financial position and the results of operations for the interim
periods presented have been reflected herein. The results of operations for the
interim periods are not necessarily indicative of the results to be expected for
the full year. Notes to the financial statements which would substantially
duplicate the disclosure contained in the audited financial statements for 2007
as reported in the 10-KSB have been omitted.





2.  DEVELOPMENT
STAGE AND GOING CONCERN





We have
been in the development stage since we began operations on January 3, 1990 and
have not generated any revenues from operations and there is no assurance of any
future revenues. As of March 31, 2008, we had an accumulated deficit of
$7,880,973 and a working capital deficit of $869,321.





In
addition, we did not generate any cash from operations. These factors create
substantial doubt as to our ability to continue as a going concern.





We will
require substantial additional funding for continuing research and development
and obtaining regulatory approval and for the commercialization of our products.
Management expects to be able to raise enough funds to meet our working capital
requirements through the sale of our common stock or other means of
financing.





There is
no assurance that we will be able to obtain sufficient additional funds when
needed, or that such funds, if available, will be obtainable on terms
satisfactory to us. The consolidated financial statements do not include any
adjustments that might be necessary should we be unable to continue as a going
concern.





3.  LINE
OF CREDIT FROM AN AFFILIATED ENTITY





During
the three months ended March 31, 2008, we paid back approximately $28,000 on the
line of credit from an affiliated entity.  As of March 31, 2008, the
line of credit from an affiliated entity balance was $1,052,778.  To
date Biomoda has paid back a total of approximately $539,818 on the line of
credit to Advanced Optics Electronics.





During
the three months ended March 31, 2007, the affiliate exchanged its Biomoda
common shares, valued at $707,150, for various services provided to
us.  In connection with this transaction, we recorded an increase to
the line of credit from an affiliated entity of $707,150 and recognized $62,500
in professional fees expense and $644,650 in general and administrative
expense.





4.  COMMON
STOCK





During
the three months ended March 31, 2008, we issued 3,225,860 common shares for
services valued at $266,293.  We also sold 23,426,179 common shares
for $2,535,255, incurring $1,858,037 in costs related to the Regulation S
offering.





For the
three months ended March 31, 2008 we sold a total of 23,426,179 common shares in
relation to our Regulation S offering for $2,535,255, incurring $1,858,036 in
costs related to the offering.





For the
three months ended March 31, 2007, we issued 726,000 shares of restricted common
stock for services valued at $792,500, 2,000 common shares for cash of $1,000,
30,000 common shares issued for stock payable, and 86,786 common shares in
exchange for discharge of debt of $73,768 to a related party.




5.  SUBSEQUENT
EVENTS
 
 During
April 2008, we issued 25,000 common shares for services valued at
$1,250.
 
 We
concluded our Regulation S offering on May 8, 2008 having sold an additional
1,328,142 common shares for $123,956, incurring $90,688 in costs related to the
offering.


6
 Table of Contents







Item2: MANAGEMENT'S DISCUSSION AND ANALYSIS AND RESULTS OF
OPERATIONS





COMPANY
OVERVIEW





Biomoda,
Inc. is a development stage company incorporated in the state of New Mexico on
January 3, 1990. Our general focus is on discovery, development,
manufacture and marketing of proprietary medical diagnostic and treatment
products used to treat life threatening and other serious
diseases.  Our primary focus is creating diagnostic solutions for
early detection and clinical management of cancer.





On July
19, 2006, we closed our offering of up to 6,000,000 shares of our common stock
pursuant to a registration statement on Form SB-2 (the "Registration Statement")
under the Securities Act of 1933, as amended, declared effective on February 11,
2005. Our market maker filed Form 211 with NASD Regulation to initiate
quotations for our common stock on the OTC Bulletin Board. The request was
cleared on October 19, 2006.





PLAN
OF OPERATION





Our plan
of operation for the next twelve months is to complete the validation studies
for our lung cancer assay, design our diagnostic product, choose our contract
manufacturing partner, manufacture our initial batches, register our product
with the FDA and then with European authorities for our CE mark, and begin
marketing to reference labs in the US and Europe.  To that end, we
have contracted with Quintiles Consulting for regulatory consulting, TriCore
Reference Laboratories for assay preparation, Averion International Corporation
for clinical services, and Clinical Research Center of Cape Cod to provide lung
sputum samples.  We intend to have initial revenues in the last
quarter of 2008.  We raised funds from the sale of restricted common
stock through a Regulation S Offering and are assessing various offering
scenarios.





Our
initial product is a diagnostic test for lung cancer that will be performed out
of body by using a sputum sample from the patient.  Our test does not
require any invasive sample taking.  The sample will be sent to a
clinical lab where the procedure will be performed to determine the presence, or
not, of lung cancer or precancerous cells.  Our diagnostic test can be
used for other cell samples and we intend to create and market products to
diagnose and screen for other prevalent cancers such as breast, cervical,
bladder, and colorectal.  We have determined that our initial markets
will be the developed nations of Europe, North America and
Japan.  This has been determined on the basis of available healthcare
delivery and payer infrastructure.  Japan has instituted a nationwide
lung cancer-screening program.  We also intend to sell our product in
additional markets throughout the world such as India, Brazil and South America,
Asia and Russia.  We will market different product formats based on
the region of the world.





In
addition to augmenting laboratory research and development, management plans to
further strengthen our corporate infrastructure to adequately manage the future
growth and success of our operations.  Management expects to hire
additional personnel and enter into consulting and collaborative arrangements
over the next twelve months as needed to continue to strengthen and enhance the
effectiveness of implementing our plan as we grow.





Our
research and development facilities are located on Kirtland Air Force Base in
Albuquerque, New Mexico.  Research and development is housed in
approximately 1000 square feet that includes two state-of-the-art laboratories
where primary research, assay validation and commercialization work is being
conducted.





Over the
next twelve months, management will continuously evaluate and develop our
business plan which includes assessing the technology we utilize and the markets
we intend to serve and evaluating the prospect of expanding into additional
products and markets as business conditions warrant. In connection with this
continual evaluation, management will also look at taking actions designed to
mitigate any and all risks associated with our business plan.






7
 Table of Contents




In
January 2005, the U.S. Patent Office awarded a Patent to Biomoda researchers
entitled "Compositions and Methods for Detecting Precancerous Conditions in
Cells and Tissue Samples using 5, 10, 15, 20 Tetrakis (Carboxyphenyl) Porphine".
This Patent brings a significant addition to our patent portfolio and expands
our intellectual property to include cancer screening as a compliment to our
existing technology. We are completing the formal filing for a continuation for
this Patent based on research currently underway by researchers at
Biomoda.  We believe our goal to further strengthen and expand our
intellectual property portfolio will be significantly enhanced by these
developments. Our R&D Division has successfully completed the first clinical
validation of our development stage assay for lung cancer.  These
results indicate its ability to differentiate lung cancer patients, heavy
smokers, and normal individuals.




In April,
2008, we received Notice of Allowance for a new Divisional Patent titled “Method
of Prognosing Response to Cancer Therapy with 5,10,15,20 - Tetrakis
(Carboxyphenyl) Porphine”.




RESULTS
OF OPERATIONS





Due to
our limited operating history, we believe that period-to-period comparisons of
our results of operations are not fully meaningful and should not be relied upon
as an indication of future performance.





Comparison of the three
months ended March 31, 2008 and 2007





REVENUE.  As of March 31, 2008, there
have been no significant revenues since inception.





PRODUCT DEVELOPMENT.  Product
development expenses consist primarily of personnel expenses and consulting
fees. Research and development, including payroll costs and other technical
costs decreased to $153,255 in the three months ended March 31, 2008 from
$471,807 in the three months ended March 31, 2007. We believe that continued
investment in product development is critical to attaining our strategic
objectives and, as a result, we expect expenses such as clinical studies and
collaborations to increase significantly in the next year. We expense product
development costs as they are incurred.





GENERAL AND ADMINISTRATIVE.  General
and administrative expenses consist of expenses for executive and administrative
personnel, facilities, professional services, travel and general corporate
activities.  General and administrative costs, taken together with
professional fees, decreased to $484,540 in the three months ended March 31,
2008 from $1,199,238 in the three months ended March 31, 2007.  We
expect general and administrative costs to increase in the future as our
business prospects develop and we will require more staff. The costs associated
with being a publicly traded company and future strategic acquisitions will also
be a contributing factor to increases in this expense.





OTHER INCOME (EXPENSE). Other income
(expense) in these periods consists of interest expense, which decreased to
$14,452 in the three months ended March 31, 2008 from $19,196 in the three
months ended March 31, 2007due to lower balance in related party
debt.




LIQUIDITY
AND CAPITAL RESOURCES





Since
inception, we have funded our operations through private placement of equity
securities and loans from Advanced Optics Electronics, Inc
("ADOT").





Product
development expenditures, including personnel expense, and general and
administrative expense was $637,797 for the three months ended March 31,
2008.  Funds for operations, product development and capital
expenditures were provided from the sale of restricted company
stock.  We will require substantial additional funding for continuing
research and development, obtaining regulatory approval and for the
commercialization of our products.






8
 Table of Contents




Management
believes that sales of securities will provide adequate liquidity and capital
resources to meet the anticipated development stage requirements through the end
of 2008.  In addition, it is anticipated that sales of our initial
screening product will begin pending FDA approval and contribute to operating
revenues.  It is anticipated that these sales will provide the
additional capital resources to fund the proportionately higher working capital
requirements of production and sales initiatives and
continued  product development for second-generation diagnostic and
therapeutic products.





There is
no assurance that we will be able to obtain sufficient additional funds when
needed, or that such funds, if available, will be obtainable on terms
satisfactory to us.  The consolidated financial statements do not
include any adjustments that might be necessary should we be unable to continue
as a going concern.





INFLATION





Management
believes that inflation has not had a material effect on our results of
operations.





Item3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET
RISK





There has
been no material change in our market risks since the end of the fiscal year
2007.





Item4: CONTROLS AND PROCEDURES





Under the
supervision and with the participation of our management, we evaluated the
effectiveness of the design and operation of our disclosure controls and
procedures (as defined in Rule 13a-15(e) and 15d-15(e) of the Exchange Act as of
the end of the period covered by this report, March 31, 2008).  Based
upon that evaluation, we concluded that our disclosure controls and procedures
were effective.





We are in
the infancy stages of our business operations and have limited resources
available to plan, develop, and implement disclosure and procedure controls and
other procedures that are designed to ensure that information required to be
disclosed in our periodic reports filed or submitted under the Exchange Act is
recorded, processed, summarized and reported, within the time periods specified
in the Securities and Exchange Commission's rules and forms. Disclosure controls
and procedures include, without limitation, controls and procedures designed to
ensure that information required to be disclosed in our periodic reports filed
under the Exchange Act is accumulated and communicated to management to allow
timely decisions regarding required disclosure.  Further, as reported
in our Current Report on Form 8-K filed on August 14, 2007, we are currently
investigating (i) what appears to be the unauthorized issuance of shares of our
common stock in violation of the Securities Act of 1933, and (ii) the improper
diversion of cash from the Company to a former officer and director and/or his
affiliates.





We are
re-evaluating and revising our existing control policies and procedures. As part
of such plan and implementation, we are re-evaluating, re-designing and
documenting policies and procedures, putting such procedures in operation, and
monitoring the effectiveness of the procedures.





CHANGES
IN CONTROLS AND PROCEDURES





Significant
changes have been made to improve our internal controls over financial reporting
during the three months ended March 31, 2008.  We have employed
additional accounting personnel which has helped us increase our segregation of
duties.  We are implementing a review process over significant
business transactions.





LIMITATIONS
ON THE EFFECTIVENESS OF INTERNAL CONTROL





Our
management, including the CEO, does not expect that our disclosure controls and
procedures or our internal control over financial reporting will necessarily
prevent all fraud and material errors.  An internal control system, no
matter how well conceived and operated, can provide only reasonable, not
absolute, assurance that the objectives of the control system are met. Further,
the design of a control system must reflect the fact that there are resource
constraints, and the benefits of controls must be considered relative to their
costs.  Because of the inherent limitations on all internal control
systems, no evaluation of controls can provide absolute assurance that all
control issues and instances of fraud, if any, within the Company have been
detected.  These inherent limitations include the realities that
judgments in decision-making can be faulty, and that breakdowns can occur
because of simple error or mistake. Additionally, controls can be circumvented
by the individual acts of some persons, by collusion of two or more people,
and/or by management's override of the controls. The design of any system of
internal control is also based in part upon certain assumptions about the
likelihood of future events, and there can be no assurance that any design will
succeed in achieving its stated goals under all potential future
conditions.  Over time, controls may become inadequate because of
changes in circumstances, and/or the degree of compliance with the policies and
procedures may deteriorate.  Because of the inherent limitations in a
cost-effective internal control system, financial reporting misstatements due to
error or fraud may occur and not be detected on a timely basis.




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PARTII. OTHER INFORMATION





Item1.  LEGAL PROCEEDINGS





On August
29, 2007, Biomoda, Inc and Advanced Optics Electronics, Inc. jointly filed a
Complaint in Federal Court, case number 1:07-cv-00855 against Leslie Robins,
Alvin Robins and John Kearns for Common Law Fraud, Violation of Federal and New
Mexico Securities Laws, Conversion, Breach of Fiduciary Duty and
Racketeering.





Biomoda
previously conducted an offering of up to 6,000,000 shares of its common stock
pursuant to a registration statement on Form SB-2.  This registration
statement became stale on November 4, 2005, prior to selling any shares under
this registered offering.  The Board is currently investigating the
issuance of the following shares of common stock purportedly under the SB-2
registration statement pursuant to Mr. Robins’ sole and unauthorized direction:
343,000 shares on or about June 5, 2007, 230,000 shares on or about June 8,
2007, 500,000 shares on or about June 25, 2007, 90,000 shares on or about July
11, 2007, 50,000 shares on or about July 11, 2007, and 555,000 shares on or
about July 13, 2007.  Based upon the Board’s initial investigation,
all of such shares were issued without registration under the Securities Act of
1933, as amended, or any exemption therefrom.  As a result, such
shares were issued in violation of the Securities Act of 1933, as
amended.  Such violations may subject Biomoda to enforcement action by
the Securities and Exchange Commission.





Item
2.  CHANGES IN SECURITIES -  None




Item
3.  DEFAULTS UPON SENIOR SECURITIES - None




Item
4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS -
None




Item
5.  OTHER INFORMATION




On, May
1, 2008, our Board of Directors voted to add three business leaders, Maria
Zannes, David Lambros, and Lewis White, to its Board of
Directors.
  • 
Maria Zannes brings more than 25 years of experience in the environmental and
energy industry—from federal lobbyist to a company president. Formerly the
president of the national waste-to-energy trade group in Washington, D.C., Ms.
Zannes currently consults for private clients in the medical and waste industry.
She was a legislative aide and press secretary to Congressman Charles Wilson
(D-Texas) after leaving her home state of New Mexico where she began her career
as a journalist. Ms. Zannes is licensed to practice law in Washington State and
will be sworn in to practice in New Mexico this summer. She is a research
associate
with Columbia University Earth Engineering Center.
 
 • 
David Lambros was the elected law director of Brook Park, Ohio, and presently
serves the law director of the Village of Valley View and the Village of Kelleys
Island, Ohio. As law director, he served as the chief legal counsel to cities
negotiating with corporations and business, and is an expert in municipal law.
Mr. Lambros has practiced law for more than 25 years and served on various
boards, including Commerce Exchange Bank and Southwest General Hospital. He
presently is a director on the Systems Board at Southwest General Hospital, a
multi-million dollar company.
 
 • 
Lewis White, a major shareholder of Biomoda, is director and CEO of New Energies
Nebraska, LLC, a subsidiary of Standard Alcohol Company. He has also served as
CEO of Los Hojas Corporation and owned a childcare business for 20 years, which
he followed with an interest in business investment through real estate and a
food services business catering to niche markets. Mr. White attended the
University of Nebraska at Omaha where majored in Business Administration and
worked for the State of Nebraska.




Item
6.  EXHIBITS





31  Certification of Principal Executive Officer pursuant to
Securities Exchange Act rules 13a-15 and 15d-15(c) as adopted pursuant to
section 302 of the Sarbanes-Oxley act of 2002.




32  Certification of Principal Executive and Accounting Officer
pursuant to 18 U.S.C. section 1350, as adopted pursuant to section 906 of the
Sarbanes-Oxley act of 2002.











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SIGNATURES








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




BIOMODA, INC.Date:
      May 14, 2008
              By:
              /s/John
      J.
      CousinsJohn
      J. CousinsPresident(Principal
      Executive and Accounting Officer)













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