U.S. SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-KSB

[X]      ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
         OF 1934 (FEE REQUIRED).

         For the fiscal year ended  December 31, 2000.
                                   --------------------

[ ]      TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
         ACT OF 1934 (NO FEE REQUIRED).

         For the transition period from            to
                                        ----------    ----------

                         Commission file number 0-19827
                                               ---------

                                  HYMEDIX, INC.
             -------------------------------------------------------
             (Exact name of registrant, as specified in its charter)

          Delaware                                              22-3279252
-------------------------------                              ----------------
(State or other jurisdiction of                              (I.R.S. Employer
incorporation or organization)                              Identification No.)

                    2245 Route 130, Dayton, New Jersey 08810
          ------------------------------------------------------------
          (Address of principal executive offices, including zip code)

Registrant's telephone number, including area code:  (732) 274-2288
                                                    ----------------

Securities registered under Section 12(b) of the Exchange Act:
                                      None

Securities registered under Section 12(g) of the Exchange Act:

                          Common Stock, $.001 Par Value
                          -----------------------------
                                (Title of class)

Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 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 [ ]

<PAGE>

Check if disclosure of delinquent filers in response to Item 405 of Regulation
S-B is not contained in this form, 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-KSB or any amendment to
this Form 10-KSB.  [X]

State registrant's revenues for its most recent fiscal year: $767,194
                                                            ----------

The aggregate market value of the voting stock held by non-affiliates, based
upon the average of the bid and asked price of the Common Stock on March 20,
2001 as reported by The OTC Bulletin Board, was approximately $148,330. Shares
of Common Stock held by each officer and director and by each person who owns 5%
or more of the outstanding Common Stock have been excluded in that such persons
may be deemed to be affiliates for this purpose but not necessarily for other
purposes.

The number of shares of Common Stock outstanding as of March 20, 2001 was
6,143,781.

Transitional Small Business Disclosure Format (Check one):

                               Yes [ ]  No [X]


                       DOCUMENTS INCORPORATED BY REFERENCE

              Portions of the Registrant's definitive Proxy Statement to be
delivered to stockholders in connection with the Annual Meeting of Stockholders
to filed with the Securities and Exchange Commission on or before April 30, 2001
are incorporated by reference into Part III hereof. With the exception of the
portions of such Proxy Statement expressly incorporated into this Annual Report
on Form 10-KSB by reference, such Proxy Statement shall not be deemed filed as
part of this Annual Report on Form 10-KSB.

<PAGE>

                                  HYMEDIX, INC.

                                      INDEX

                                                                        PAGE NO.
PART I

     Item 1.      Description of Business                                   1

     Item 2.      Description of Property                                   4

     Item 3.      Legal Proceedings                                         4

     Item 4.      Submission of Matters to a Vote of Security Holders       5


PART II

     Item 5.      Market for Common Equity and Related Stockholder Matters  6

     Item 6.      Management's Discussion and Analysis of Financial
                  Condition and Results of Operations                       7

     Item 7.      Financial Statements                                     13

     Item 8.      Changes In and Disagreements with Accountants on
                  Accounting and Financial Disclosure                      13


PART III

     Item 9.      Directors, Executive Officers, Promoters and Control
                  Persons; Compliance with Section 16(a) of the
                  Exchange Act                                             14

     Item 10.     Executive Compensation                                   18

     Item 11.     Security Ownership of Certain Beneficial Owners
                  and Management                                           19

     Item 12.     Certain Relationships and Related Transactions           21

SIGNATURES                                                                 23

     Item 13.     Exhibits and Reports on Form 8-K                         22

                                       i

<PAGE>

                                     PART I


ITEM 1.  DESCRIPTION OF BUSINESS.

BACKGROUND

         HYMEDIX, Inc. ("HYMEDIX") was incorporated in Delaware on December 20,
1993 as a wholly-owned subsidiary of Servtex International Inc. (the
"Predecessor"). On February 23, 1994, the Predecessor merged with and into
HYMEDIX, Inc. and, concurrently, a wholly-owned subsidiary of the Predecessor
was merged with and into HYMEDIX International, Inc. ("HYMEDIX International"),
which resulted in HYMEDIX International becoming a wholly-owned subsidiary of
HYMEDIX (collectively, the "Acquisition Merger"). The Acquisition Merger was
accounted for as a recapitalization of HYMEDIX International and an acquisition
by HYMEDIX International of the Predecessor using historical values of the
assets and liabilities of the Predecessor. HYMEDIX International was
incorporated in October, 1985 under the name Kingston Technologies, Inc. As used
in this Form 10-KSB, unless the context otherwise requires, the term "Company"
collectively means HYMEDIX, HYMEDIX International and their respective
predecessors.

         The Company has been engaged through the HYMEDIX International
subsidiary, in the development and commercialization of medical and skin care
products based on its proprietary synthetic HYPAN(R) hydrogels and memory
polymers. These hydrophilic polymers are biocompatible and highly versatile, and
enable the Company to develop products and components with advantageous
characteristics for a number of medical and other markets.

PRODUCTS

         The Company has developed two product lines in the past several years,
a line of synthetic dressings for the treatment of chronic wounds, and a line of
moisturizing creams and gels for the consumer skin care markets. In addition,
the Company has several product development agreements with companies in the
fields of drug delivery and permanent implants.

         WOUND CARE PRODUCTS

         The Company had developed a line of seven products for the chronic
wound care markets, six of which have received market clearance from the FDA,
and one of which does not require FDA clearance. In November, 1995, the Company
entered into an agreement with ProCyte Corporation ("ProCyte") granting it a
license to make, have made, use and sell products for the wound care field using
the Company's HYPAN(R) technology. ProCyte modified one of the Company's wound
care products, and has introduced it to the market. In late 1997, the ProCyte
license agreement was modified to limit its rights to that specific product. The
Company is seeking a new marketing partner or licensee for its remaining wound
care products and additional new products, developed recently.

         SKIN CARE PRODUCTS

         The Company has developed a line of moisturizing creams and gels based
on the emulsifying capabilities of its hydrophilic polymer systems and has
introduced them to the United States market under the trade name BIONIQ(R). The

<PAGE>

Company has also introduced a similar line of skin care products to Asian
markets through a marketing partner. Until February 1997, the Company's
principal means of distribution of BIONIQ(R) products was direct response
television. When the monthly volume of direct response television sales did not
meet the marketing company's expectations, direct response selling was
discontinued. While continuing to seek another means of distribution, the
Company sells a small amount of BIONIQ(R) products itself on the internet and by
responding to telephone orders. The BIONIQ(R) product line presently consists of
Body Therapy(TM), a moisturizing lotion; Replenishing Complex(TM), a
moisturizing gel; Facial Formula(TM) (Dry/Normal) and Facial Formula(TM)
(Normal/Oily), facial creams; Hydrating Cleanser(TM) (Dry/Normal) and Clarifying
Cleanser(TM) (Normal/Oily), facial cleansers; Cucumber Refining Solution(TM)
(Dry/Normal) and Tropical Refining Solution(TM) (Normal/Oily), facial toners;
and Baby Therapy(TM), a body lotion for babies. Additional skin care products
are under development. The Company is exploring other marketing channels for
BIONIQ(R), including other direct selling methods.

         RESEARCH & DEVELOPMENT CONTRACTS

         The Company is working on the development of products for other medical
products companies under several R&D contracts. In 1991, the Company entered
into a three year development agreement (which has been extended for a ninth
year on substantially similar terms) with a major private U.S. medical products
company for medical products using HYPAN(R) hydrogels in areas other than wound
care. This medical products Company's primary focus has been on certain types of
drug delivery and permanent implants. The Company's HYPAN(R) polymers are
presently being evaluated for controlled release of wound healing agents,
certain types of OTC products, embolic agents, thermo-reversible gels for
various uses, for gastro-intestinal products and for certain ophthalmic
applications.

         LICENSE AGREEMENTS

         The Company has an Option and License Agreement for the intro-occular
Memory Lens(TM) with the Mentor Corporation. The Memory Lens has been on the
market in Europe since 1995, and at the beginning of 1998 gained FDA approval
for sales in the U.S. market. The Company is realizing royalty payments from the
sales of the Memory lens world-wide. During 1999, the Company transferred all
rights, title, and interest to the patent rights, as defined, to Mentor
Corporation's successor for a one-time payment of $1,450,000. The full amount
has been received by the Company as of December 31, 1999. Due to the fact that
the Company has not satisfied all of its obligations under the agreement, as
defined, a portion of the proceeds was recorded as deferred income. The Company
also has license agreements for HYPAN(R) spinal disc replacement, HYPAN(R)
particles as embolic agents and HYPAN(R) guidewires and catheters.

         SPECIALTY CHEMICALS

         Since 1988, the Company has sold HYPAN(R) hydrogels to the cosmetics
and personal care industry (the "Trade") through a marketing partner, LIPO
Chemicals, Inc. ("LIPO"). The Company signed a new Marketing and Distribution
Agreement with LIPO Chemicals, Inc. on December 22, 1998, pursuant to which LIPO
will retain its exclusive distribution rights worldwide, and the rights to
manufacture two grades of HYPAN TN polymers, while the Company will keep the
rights to manufacture all the other grades. The Company is also supplying
special grades of HYPAN(R) polymers for photographic products, for maritime
sensors and for specialty filters. Other areas are under development.

                                       2

<PAGE>

REGULATORY APPROVALS

         The Company's products are subject to extensive regulation by U.S. and
foreign governmental authorities for efficacy, safety and quality. For U.S.
regulatory purposes, it is anticipated that most of the Company's products
(other than cosmetics and toiletries products) will be deemed medical devices
under the Federal Food, Drug and Cosmetic Act (the "FFDCA") although some
products may be treated as pharmaceutical agents (drugs) under the FFDCA,
depending on their intended use and applicable regulatory policies.

TECHNOLOGY AND PATENTS

         The Company has developed several families of patented synthetic
hydrogels (i.e., hydrophilic polymer systems which do not dissolve in water)
which can be used in a broad range of medical and other applications. These
multi-block copolymers are tradenamed HYPAN(R), an acronym for hydrolyzed
polyacrylonitrile (PAN). In addition to HYPAN(R) hydrogels, the Company has
developed temperature activated polymer systems with precise inherent shape
memories.

         The Company's polymers, the processes for making them and a number of
specific products and applications are covered by U.S. and foreign patents. Most
of the polymers currently used in the Company's products are covered under
patents issued or filed since 1990. These polymers have been extensively tested
for biocompatibility by both the Company and its licensees.

COMPETITION

         The Company is engaged in highly competitive markets for its products,
most of the competitors having substantially more resources than HYMEDIX.

MANUFACTURING AND RAW MATERIALS

         The Company's principal raw materials are Polyacrylonitrile (PAN) and a
variety of other readily available chemicals.

         The Company manufactures HYPAN(R) materials at its Dayton, New Jersey
facility. The Company believes that it presently has the capacity it needs to
meet its HYPAN(R) hydrogel production requirements for the next three years, and
that its raw materials for its operations are and will continue to be available
for the foreseeable future. The Company's skin care products are manufactured to
its specifications by contract manufacturers.

EMPLOYEES

         The Company presently employs twelve (12) people, seven (7) of whom are
engaged in management, marketing and administration; one (1) in regulatory
affairs and quality assurance/control; one (1) in production; and three (3) in
research and product development. None of the Company's personnel are

                                       3

<PAGE>

represented by a union, and the Company believes its personnel relations are
excellent.


ITEM 2.  DESCRIPTION OF PROPERTY.

         The Company rents approximately 22,000 square feet of office,
laboratory and manufacturing space at 2245 Route 130 in Dayton, New Jersey under
a lease with annual rental of approximately $354,000 per year (excluding
utilities). The lease expires on June 30, 2003. At this facility the Company can
manufacture approximately 5 tons of HYPAN(R) a year (enough annual capacity for
the foreseeable future). The facility also provides all of the Company's office
and laboratory space requirements.

ITEM 3.  LEGAL PROCEEDINGS.

         The Company's former President filed a claim against the Company, the
Company's Directors and Kingston Technologies Limited Partnership (a
stockholder). The complaint, filed in September 1993, alleged that the Company
wrongfully terminated the former President, that he was owed $367,500 in
deferred compensation and $74,500 in back salary and that approximately $323,000
was owed him based on his claim that an agreement signed by him was signed under
duress and is, therefore, void. The Company filed an answer denying most of the
former President's claims for relief. The Company paid $74,500 in 1994 resulting
in the parties settling the claim regarding back salary. In July 1996, a
judgement was rendered against the Company in the amount of $805,964 plus
interest in connection with this case. In April 1998, $438,464 of the judgement
was reversed on appeal. The $367,500 claim for deferred compensation was
affirmed by the Appellate Court. Accordingly, the Company reversed $438,464 of
the accrued legal judgement plus related accrued interest in 1998. In July 1999,
the Company reached an agreement to reduce the judgement to $350,000 with the
forgiveness of all accrued interest, to be paid in monthly payments over the
next four years. During the year ended December 31, 2000 and 1999, $75,000 and
$80,000 was paid, respectively. The agreement stipulates that if any monthly
payments are in default, as defined, the judgement will revert back to $367,500
with full payment of accrued interest. The Company has not reflected the
reduction in the judgement and accrued interest as of December 31, 2000, due to
the Company's financial condition. The Company has accrued the affirmed
judgement plus interest in the accompanying consolidated financial statements as
of December 31, 2000.

         An individual filed a complaint against the Company alleging that the
Company owed him eight percent of all monies invested in the Company as a result
of his contacts. The complaint alleged that the Company owed him approximately
$5,000,000 and warrants to purchase the Company's common stock. In December
1998, a settlement agreement was signed by the individual, the Company and First
Taiwan and its affiliates. The Company agreed to pay the individual $200,000
plus interest over a thirty-six month period commencing January 1, 2000. In
January 2000, the full amount of $200,000 was paid. In addition, the Company
agreed to issue warrants to purchase the equivalent of seven percent of the
issued and outstanding common stock of the Company as of November 30, 1998
(430,048) giving effect to an inclusion of the common stock underlying the
warrants as though all the warrants issued under the settlement were fully
exercised. The warrants may be exercised by the individual, in whole or in part
or parts at any time during a ten year period commencing January 23, 1999 and
ending on January 22, 2009, and have an exercise price of $.01 per warrant. The

                                       4

<PAGE>

warrants and the common stock issued provide for an anti-dilution adjustment in
the event of any change in the capitalization of the Company which would
otherwise dilute the warrants of the common stock. The Company valued the
warrants at their estimated fair value of $4,300 using the Black Scholes method.
Such warrants were exercised during 1999 for $4,300.

         The settlement agreement also provides the Company the option to
purchase all or part of the warrants and the common stock issued to the
individual pursuant to the settlement agreement if the market capitalization of
the Company exceeds $15,000,000.

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

         There were no matters submitted to a vote of security holders during
the period October 1, 2000 through December 31, 2000.

                                       5

<PAGE>

                                     PART II


ITEM 5.  MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.

         The Predecessor's Common Stock had been listed and traded on the Nasdaq
National Market since January 30, 1992 upon the closing of the Predecessor's
initial public offering. The Predecessor's Common Stock was delisted from
trading on the Nasdaq National Market on October 21, 1993, due to its failure to
meet the Nasdaq National Market listing maintenance requirements. After the
Acquisition Merger, the common stock was accepted for listing on the Nasdaq
SmallCap Market under the symbol HYMX. During the third quarter of 1994, the
Company's total stockholders' equity fell below the minimum necessary to
maintain its listing on the Nasdaq SmallCap Market. Consequently, Nasdaq
delisted the common stock from the Nasdaq SmallCap Market on October 27, 1994.
HYMEDIX shares are currently quoted and continue to be traded on The Over The
Counter ("OTC") Electronic Bulletin Board under the symbol HYMX.

         The following table sets forth the range of the high and low bid prices
for each of the Company's foregoing securities as reported by The OTC Bulletin
Board for the eight quarterly periods ended December 31, 2000.

                                                         COMMON STOCK
               PERIOD                                    HIGH      LOW

               1999:
                        1st quarter                     $0.04     $0.03
                        2nd quarter                      0.04      0.04
                        3rd quarter                      0.08      0.04
                        4th quarter                      0.10      0.04

               2000:
                        1st quarter                     $0.08     $0.04
                        2nd quarter                      0.09      0.08
                        3rd quarter                      0.10      0.09
                        4th quarter                      0.11      0.07


         The stock price ranges represent the high and low bid quotations as
listed by The OTC Bulletin Board and reflect inter-dealer prices without retail
mark-up, mark-down, or commission and may not necessarily represent actual
transactions.

         As of the close of business on March 20, 2001, there were 122 holders
of record of the Company's Common Stock. The Company believes that it had
approximately 400 beneficial owners of such securities as of such date.

         The Company has paid no cash dividends in respect of its Common Stock
and the Company has no intention to pay cash dividends in the foreseeable
future.

                                       6

<PAGE>

ITEM 6.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS.

         This report contains forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934. Actual results could differ materially from those
projected in the forward-looking statements as a result of the risk factors set
forth below. The industry in which the Company competes is characterized by
rapid changes in technology and frequent new product introductions. The Company
believes that its long-term growth depends largely on its ability to continue to
enhance existing products and to introduce new products and technologies that
meet the continually changing requirements of customers. While the Company has
devoted significant resources to the development of new products and
technologies, the Company currently has limited resources and there can be no
assurance that it can continue to introduce new products and technologies on a
timely basis or that certain of its products and technologies will not be
rendered noncompetitive or obsolete by its competitors.

         Overview

         HYMEDIX, Inc. ("HYMEDIX") was incorporated in Delaware on December 20,
1993 as a wholly-owned subsidiary of Servtex International Inc. (the
"Predecessor"). On February 23, 1994, the Predecessor merged with and into
HYMEDIX, Inc. and, concurrently, a wholly-owned subsidiary of the Predecessor
was merged with and into HYMEDIX International, Inc. ("HYMEDIX International")
which resulted in HYMEDIX International becoming a wholly-owned subsidiary of
HYMEDIX (collectively, the "Acquisition Merger"). The Acquisition Merger was
accounted for as a recapitalization of HYMEDIX International and an acquisition
of the Predecessor by HYMEDIX International using historical values of the
assets and liabilities of the Predecessor. As used in this Form 10-KSB, unless
the context otherwise requires, the term "Company" collectively means HYMEDIX,
HYMEDIX International and their respective predecessors. HYMEDIX International
was incorporated in October, 1985 under the name Kingston Technologies, Inc. In
February, 1994, at the time of the Acquisition Merger, the Company raised
approximately $3.6 million net proceeds from the private placement of common
stock and warrants (the "Private Placement").

         Recently Issued Accounting Standards

         In April, 1998, the Accounting Standards Executive Committee issued
Statement of Position ("SOP") 98-5, "Reporting on the Costs of Start-Up
Activities." This SOP requires all costs incurred as start-up costs or
organization costs be expensed as incurred. Adoption of this SOP in 2000 had no
impact on the Company's consolidated financial statements.

         In March, 1998, the Accounting Standards Executive Committee issued SOP
98-1, "Accounting for the Costs of Computer Software Developed or Obtained for
Internal Use." This SOP requires that computer software costs that are incurred
in the preliminary project stage be expensed as incurred and that criteria be
met before capitalization of costs to develop or obtain internal use computer
software. Adoption of the SOP in 2000 had no impact on the Company's
consolidated financial statements.

                                       7

<PAGE>

RESULTS OF OPERATIONS

         REVENUES

         The Company's total revenues for the fiscal year ended December 31,
2000 were $767,194, versus $1,225,550 for the fiscal year ended 1999, a decrease
of 37.4%. The decreased revenues for fiscal year 2000 from the previous year
primarily results from (i) a decrease of $128,390 in net products sales; (ii) a
decrease of $245,466 in license and royalty fees; and (iii) a decrease of
$84,500 in research and development fees. The decrease in net product sales is
primarily due to a decrease in net sales of hydrogels' to two major customers
and a decrease in BIONIQ(R) sales to an overseas customer and the decrease in
license and royalty fees primarily as the result of a decrease of $260,466 in
royalties due to the Company no satisfying all its obligations under the
agreement with a major customer offset by an increase of $15,000 in license
fees..

         For the years ended December 31, 2000 and 1999, two of the Company's
product lines encompassed over 99% and 92% of net product sales, respectively.
For the year ended December 31, 2000, two of the Company's customers accounted
for 42% and 32% of the total revenues. For the year ended December 31, 1999, two
of the Company's customers accounted for 72% and 20% of the total revenues.

         COSTS AND EXPENSES

         Cost of sales for the fiscal year ended December 31, 2000 was $169,809
versus $312,453 for fiscal year 1999, a decrease of 45.7%. The decrease in cost
of sales was attributable to the lower sales, higher margin, and the $100,000
inventory reserve established in 1999 for aged HYPAN(R) products. Selling,
general and administrative expenses for fiscal year ended December 31, 2000 was
$938,770 versus $1,404,237 for the fiscal year ended 1999, a decrease of 33.1%.
The decrease was principally due to a decrease in staff expenses and legal fees.
Research and development costs for fiscal year were $378,730 versus $475,117 for
fiscal year 1999, a decrease of 20.3%, resulting from the decrease in staff
expenses.

         LEGAL JUDGMENT AND SETTLEMENT

         The Company's former President filed a claim against the Company, the
Company's Directors and Kingston Technologies Limited Partnership (a
stockholder). The complaint, filed in September 1993, alleged that the Company
wrongfully terminated the former President, that he was owed $367,500 in
deferred compensation and $74,500 in back salary and that approximately $323,000
was owed him based on his claim that an agreement signed by him was signed under
duress and is, therefore, void. The Company filed an answer denying most of the
former President's claims for relief. The Company paid $74,500 in 1994 resulting
in the parties settling the claim regarding back salary. In July 1996, a
judgment was rendered against the Company in the amount of $805,964 plus
interest in connection with this case. In April 1998, $438,464 of the judgement
was reversed on appeal. The $367,500 claim for deferred compensation was
affirmed by the Appellate Court. Accordingly, the Company reversed $438,464 of
the accrued legal judgement plus related accrued interest in 1998. In July 1999,
the Company reached an agreement to reduce the judgement to $350,000 with the
forgiveness of all accrued interest, to be paid in monthly payments over the
next four years. During the year ended December 31, 2000 and 1999, $75,000 and
$80,000 was paid, respectively. The agreement stipulates that if any monthly

                                       8

<PAGE>

payments are in default, as defined, the judgement will revert back to $367,500
with full payment of accrued interest. The Company has not reflected the
reduction in the judgement and accrued interest as of December 31, 2000, due to
the Company's financial condition. The Company has accrued the affirmed
judgement plus interest in the accompanying consolidated financial statements as
of December 31, 2000.

         An individual filed a complaint against the Company alleging that the
Company owed him eight percent (8%) of all monies invested in the Company as a
result of his contacts. The complaint alleged that the Company owed him
approximately $5,000,000 and warrants to purchase the Company's common stock. In
December 1998, a settlement agreement was signed by the individual, the Company
and First Taiwan and its affiliates. The Company agreed to pay the individual
$200,000 plus interest over a thirty-six month period commencing January 1,
2000. In January 2000, the full amount of $200,000 was paid. In addition, the
Company agreed to issue warrants to purchase the equivalent of seven percent
(7%) of the issued and outstanding common stock of the Company as of November
30, 1998, which is 430,048 shares of common stock, giving effect to an inclusion
of the common stock underlying the warrants as though all the warrants issued
under the settlement were fully exercised. The warrants may be exercised by the
individual, in whole or in part or parts at any time during a ten year period
commencing January 23, 1999 and ending on January 22, 2009, and have an exercise
price of $.01 per warrant. The warrants and the common stock issued provide for
an anti-dilution adjustment in the event of any change in the capitalization of
the Company which would otherwise dilute the warrants of the common stock. The
Company valued the warrants at their estimated fair value of $4,300 using the
Black Scholes method. Such warrants were exercised during 1999 for $4,300.

         The settlement agreement also provides the Company the option to
purchase all or part of the warrants and the common stock issued to the
individual pursuant to the settlement agreement if the market capitalization of
the Company exceeds $15,000,000.

         OTHER INCOME (EXPENSE)

         Total other income (expense), net for fiscal year ended December 31,
2000 was $83,978 versus $1,356,536 for fiscal year 1999, a decrease of
$1,272,558. The decrease in income was mainly due to gain on the settlement in
1999 for prior rent that has been forgiven by the Company's ex-landlord, a
decrease in net operating loss ("NOL") sale of a portion of the Company's New
Jersey NOLs to a company as approved and permitted by the State of New Jersey,
and a decrease in collection of a receivable previously written off by the
Company in a prior year.

         As a result of the decreased revenues and other income described above,
decreased costs and expenses, the Company incurred a net loss of $636,137 for
the fiscal year ended December 31, 2000 versus an income of $390,279 for the
fiscal year ended 1999.

LIQUIDITY, CAPITAL RESOURCES AND CHANGES IN FINANCIAL CONDITION

         The Company had $181,282 in cash and cash equivalents on hand as of
December 31, 2000 versus $356,003 as of December 31, 1999. The working capital
deficit as of December 31, 2000 was $8,349,457 versus $7,473,421 as of December
31, 1999, an increase of 11.7%. The increase in working capital deficit was
primarily attributable to the net loss incurred in 2000.

                                       9

<PAGE>

         The Company's two term loans, advanced to the Company by licensees
pursuant to license agreements, in the principal amounts of $1,500,000 and
$900,000, respectively, each have been classified as current liabilities as they
are in technical default as a result of certain interest payments not having
been made.

         During the first quarter of 1996, the Company issued a convertible bond
in the principal amount of $150,000 (the "September Bond") pursuant to a
Convertible Bond Purchase Agreement effective March 5, 1996, by and among the
Company, HYMEDIX International and Su Chen Huang. The September Bond bears
interest at a rate of 7% per annum and matured (after being extended) on March
31, 1998. The Company is currently in default and is negotiating to extend the
due date of the bond. The September Bond is convertible in whole at any time
prior to payment or prepayment into one hundred fifty thousand (150,000) shares
of common stock of the Company. Interest on the September Bond is payable at
maturity or upon prepayment or conversion thereof.

         In April of 1996, the Company issued convertible bonds in the aggregate
principal amount of approximately $981,000 (the "June Bonds") pursuant to a
Convertible Bond Purchase Agreement effective February 27, 1996, by and among
the Company, HYMEDIX International, First Taiwan Investment and Development,
Inc. and the Purchasers (as defined therein). The June Bonds bear interest at a
rate of 7% per annum and matured (after being extended) on March 31, 1998. The
Company is currently in default and negotiating to extend the due date of the
bonds. The June Bonds are convertible in whole or in part at any time prior to
payment or prepayment into one thousand (1,000) shares of common stock of the
Company for each one thousand dollars ($1,000) of principal amount outstanding.
Interest on the June Bonds is payable at maturity or upon prepayment or
conversion thereof.

         Both the June Bonds and the September Bond are structured in such a way
as to permit the Company, subject to certain terms and conditions, including
approval of the Bondholders (as hereinafter defined), to make withdrawals from a
special account (the "Special Account") up to the principal amount of the bonds
on a periodic basis and to require the Company to reduce the amount withdrawn
with respect to the Special Account by making payments into the Special Account.
As of December 31, 2000, the Company had made various withdrawals from and
repayments to the Special Account.

         Pursuant to a Security Agreement dated as of August 8, 1996, by and
among the Company and the Bondholder Representative (as defined therein), in
order to induce the Purchasers and Su Chen Huang (collectively, the
"Bondholders") to approve future withdrawals by the Company from the special
account, the Company granted to the Bondholder Representative, for the ratable
benefit of the Bondholders, a security interest in all of the Company's assets
and properties.

         In June of 1997, the Company received a payment of a $100,000
refundable deposit from a potential distributor with whom the Company has
reached an agreement in principle regarding certain aspects of the Company's
consumer skin care business. The Company has agreed to grant the distributor an
option to negotiate an agreement with the Company with respect to the Company's
skin care products in certain territories or to match the terms of any such
agreement that the Company may negotiate with a third party, on a right-of-first
refusal basis. This option expires on the earlier of June 30, 2001 or the date
on which the Company reaches any such third party agreement. The $100,000
deposit would be refundable to the distributor in the event any such third party

                                       10

<PAGE>

agreement is consummated or creditable against amounts payable under any
definitive agreement between the Company and this distributor. This option is
subject to negotiation and execution of a definitive agreement regarding this
matter.

         Management is not certain that the Company will have adequate resources
to finance its operations in 2001. In addition, a judgement in the amount of
$367,500 has been rendered against the Company. Financing the judgement as well
as the Company's operations will be difficult. Management plans to continue to
seek and evaluate financing alternatives for the Company. In the event that cash
flow from operations and the anticipated proceeds from the financing, if any,
are not sufficient to fund the Company's operations and obligations in 2001,
there is no assurance that other sources of funds will be available to the
Company.

RISK FACTORS AND CAUTIONARY STATEMENTS

         When used in this Form 10-KSB and in future filings by the Company with
the Securities and Exchange Commission, the Company's press releases and in oral
statements made with the approval of an authorized executive officer, the words
or phrases "will likely result", "are expected to", "will continue", "is
anticipated", "estimate", "project", or similar expressions are intended to
identify "forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995. Such statements are subject to certain
risks and uncertainties, including those discussed under this caption "Risk
Factors and Cautionary Statements," that could cause actual results to differ
materially from historical earnings and those presently anticipated or
projected. The Company wishes to caution readers not to place undue reliance on
any such forward-looking statements, which speak only as of the date made, and
wishes to advise readers that the factors listed below could cause the Company's
actual results for future periods to differ materially from any opinions or
statements expressed with respect to future periods in any current statements.

         The Company will NOT undertake and specifically declines any obligation
to publicly release the result of any revisions which may be made to any
forward-looking statements to reflect events or circumstances after the date of
such statements or to reflect the occurrence of anticipated or unanticipated
events.

         The Company had a loss from operations of $720,115 for the fiscal year
ended December 31, 2000 and had an accumulated deficit at December 31, 2000 of
$8,368,259. The Company has experienced ongoing losses from operations. The
Company has a limited cash balance and is in technical default on it's loans.
There can be no assurance that the Company's revenues will grow sufficiently to
fund its operations and achieve profitability. Management plans to continue to
seek and evaluate financing alternatives for the Company. In the event that cash
flow from operations and the anticipated proceeds from a financing, if any, are
not sufficient to fund the Company's operations in 2001, there can be no
assurance that other sources of funds will be available to the Company.

         o    The Company's revenues and income are derived primarily from the
development and commercialization of medical and skin care products. The medical
and skin care products industry is highly competitive. Such competition could
negatively impact the Company's market share and therefore reduce the Company's
revenues and income. Competition may also result in a reduction of average unit
prices paid for the Company's products. This, in turn, could reduce the
percentage of profit margin available to the Company for its product sales.

                                       11

<PAGE>

         o    The Company's future operating results are dependent on its
ability to develop, produce and market new and innovative products and
technologies, and to successfully enter into favorable licensing and
distribution relationships. There are numerous risks inherent in this complex
process, including rapid technological change and the requirement that the
Company develop procedures to bring to market in a timely fashion new products
and services that meet customers' needs. There can be no assurance that the
Company will be able to successfully develop and commercialize any new products
or technologies.

         o    Historically, the Company's operating results have varied from
fiscal period to fiscal period; accordingly, the Company's financial results in
any particular fiscal period are not necessarily indicative of results for
future periods.

         o    The Company may offer a broad variety of products and technologies
to customers around the world. Changes in the mix of products and technologies
comprising revenues could cause actual operating results to vary from those
expected.

         o    The Company's success is partly dependent on its ability to
successfully predict and adjust production capacity to meet demand, which is
partly dependent upon the ability of external suppliers to deliver components
and materials at reasonable prices and in a timely manner; capacity or supply
constraints, as well as purchase commitments, could adversely affect future
operating results.

         o    The Company offers its products and technologies directly and
through indirect distribution channels. Changes in the financial condition of,
or the Company's relationship with, distributors, licensees and other indirect
channel partners, could cause actual operating results to vary from those
expected.

         o    The Company does business and continues to seek to develop
business on a worldwide basis. Global and/or regional economic factors and
potential changes in laws and regulations affecting the Company's business,
including without limitation, currency exchange rate fluctuations, changes in
monetary policy and tariffs, and federal, state and international laws
regulating its products, could impact the Company's financial condition or
future results of operations.

         o    The market price of the Company's securities could be subject to
fluctuations in response to quarter to quarter variations in operating results,
market conditions in the medical and skin care products industry, as well as
general economic conditions and other factors external to the Company.

ITEM 7.  FINANCIAL STATEMENTS.

         See Financial Statement beginning on page F-1.

                                       12

<PAGE>

ITEM 8.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
         FINANCIAL DISCLOSURE.

         Effective January 31, 2001, the Registrant dismissed its prior
Independent Auditors, Arthur Andersen LLP ("AA") and retained as its new
Independent Auditors, O'Connor Davies Munns & Dobbins, LLP ("ODMD"). AA
Independent Auditor's Report on the Registrant's financial statements for the
fiscal year ended December 31, 1999 did not contain an adverse opinion or a
disclaimer of opinion, and was not qualified or modified as to uncertainty,
audit scope or accounting principles. The decision to engage ODMD was authorized
by the Registrant's board of directors. During the fiscal year ended 2000 and
through January 31, 2001, there were no disagreements between the Registrant and
AA on any matter of accounting principles or practices, financial statement
disclosure, or auditing scope of procedure, which, if not resolved to AA's
satisfaction, would have caused it to make reference to the subject matter of
the disagreements in connection with its report. Furthermore, no "reportable
events" occurred within the Registrant's two most recent fiscal years prior to
AA's dismissal.

         Neither the Registrant nor any person acting on its behalf, prior to
the engagement of ODMD, consulted ODMD regarding the application of accounting
principles to a specific completed or contemplated transaction, or the type of
audit opinion that might be rendered on the Registrant's financial statements,
including any of the matters or events set forth in Item 304(a)(2)(i) and (ii)
of Regulation S.B.

                                       13

<PAGE>

                                    PART III

ITEM 9.  DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS;
         COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT.

         Set forth below is certain background information with respect to the
directors and executive officers of the Company, including information furnished
by them as to their principal occupations for the last five years, certain other
directorships held by them and their ages as of March 30, 2001. Each of the
Directors and Officers set forth below, other than Dr. Jennings, also hold the
same position with HYMEDIX International.
<TABLE>
<CAPTION>

                                                                               Director or
                                                                                Executive
Name                             Age    Position(s) with the Company          Officer Since
----                             ---    ----------------------------          -------------
<S>                              <C>    <C>                                        <C>
Charles K. Kliment, Ph.D.        68     President and Chief Executive Officer      1994

William G. Gridley, jr.(3)       72     Chairman, Chief Financial Officer,
                                        Secretary, Treasurer and Director          1994

George P. Stoy                   53     Vice President of Engineering and
                                        Director                                   1994

Sheng-Hsiung Hsu                 58     Director                                   1994

Dr. Hsia-Fu Chao(1)(3)           66     Director                                   1994

Shu-Jean Kuo Chou                63     Director                                   1994

Michael K. Hsu(1)(2)(3)          43     Director                                   1994

Edward H. Jennings, Ph.D.(1)(2)  65     Director                                   1994
</TABLE>
------------------------------

(1)  Member of the Compensation Committee of the Board of Directors

(2)  Member of the Audit Committee of the Board of Directors

(3)  Member of the Executive Committee of the Board of Directors

                                       14

<PAGE>

         CHARLES K. KLIMENT, PH.D., President and Chief Executive Officer. Dr.
Kliment has been President and Chief Executive Officer since the Acquisition
Merger. Dr. Kliment joined HYMEDIX International in 1990 as Vice President of
Research and Development. Dr. Kliment worked for ten years at the Academy of
Sciences in Prague with Professor Otto Wichterle on the development of soft
contact lenses and other biomedical uses of HYDRON hydrogels. From 1969 to 1974,
he was the Research and Development Manager of National Patent Development
Corporation. From 1974 to 1984 Dr. Kliment was Director of Research of NPD
Optical Corporation. In 1984, he moved to Tyndale Plains-Hunter, Ltd. as Vice
President and worked there until 1990, primarily with hydrophilic polyurethanes.

         WILLIAM G. GRIDLEY, JR., Chairman, Chief Financial Officer, Secretary,
Treasurer and Director. Mr. Gridley was President and a Director of HYMEDIX from
the Acquisition Merger to January 1, 1996, when he became Chairman. Prior to
joining HYMEDIX International in 1986, Mr. Gridley was President of Brandywine
Investors, an investment management firm which he founded. From 1979 to 1983, he
was President of Crescent Diversified, Ltd. and Competrol BVI, the United States
investment vehicles of the Olayan Group. From 1973 to 1979, he was Executive
Vice President of the American Express Bank. Prior to that, he was a Vice
President of the Chase Manhattan Bank. Mr. Gridley is Vice Chairman of Tuskegee
University and a member of the Board of Managers of the Jane Coffin Childs
Memorial Fund for Medical Research. He is a graduate of Yale University.

         GEORGE P. STOY, Vice President of Engineering and Director. Mr. Stoy
has served as Vice President of Engineering of HYMEDIX since the Acquisition
Merger. Mr. Stoy has been with HYMEDIX International since its inception. Mr.
Stoy has been involved in the development of HYPAN(R)technology from its early
stages, and is responsible for the development of processing technology and
product design. Mr. Stoy is an inventor or co-inventor of numerous inventions
that are the subject of patents and patent applications. Mr. Stoy holds a
Masters degree in Mechanical Engineering.

         SHENG-HSIUNG HSU, Director. Mr. Hsu has served as a Director of HYMEDIX
since the Acquisition Merger. Mr. Hsu joined HYMEDIX International as a Director
in 1993. Mr. Hsu was the Chairman of First Taiwan Venture Capital Inc. In 1973,
he founded Cal-Comp Electronics, Inc. which is now the world's largest
electronic calculator manufacturer. He currently serves as the Chairman and the
President of Cal-Comp Electronics, Inc. He is also the founder and Executive
Director of Compal Electronics, Inc., a major monitor and notebook PC
manufacturer in Taiwan. Mr. Hsu also holds various positions in a number of
corporations and entities, including Baotek Industrial Materials Ltd., Electric
Appliance Manufactures' Association, and Electric & Electronic Production
Development Association.

         DR. HSIA-FU CHAO, Director. Dr. Chao has served as a Director of
HYMEDIX since the Acquisition Merger. Dr. Chao joined HYMEDIX International as a
Director in 1993. Dr. Chao is the Chairman of First Taiwan Investment Holding
Inc. He is a Director of First Taiwan Investment Banking Group. Dr. Chao has
practiced medicine for over 30 years. He is a specialist in Gastroenterology and
Gastroenterological Oncology. In 1963, he started his medical career as a
Resident in Veterans General Hospital, Taipei. He was the Chief of Division of
Gastroenterological Oncology when he left in 1980. Dr. Chao then joined China
Medical Center, Taipei. He was the Chairman from 1984 to 1986 and now serves as
a Consultant Physician and a Director of CMC.

                                       15

<PAGE>

He has also taught in National Yang Ming Medical University and National Defense
Medical Center. He graduated from National Defense Medical Center in 1961 and
was a Fellow in medicine at the Washington University, U.S.A.

         SHU-JEAN KUO CHOU, Director. Mrs. Kuo has served as a Director of
HYMEDIX since the Acquisition Merger. Mrs. Kuo joined HYMEDIX International as a
Director in 1993. Mrs. Kuo is a Director of First Taiwan Investment Holding Inc.
Mrs. Kuo comes from a family with a long business history in Taiwan and is an
active investor; she has over 30 years of experience of investing in a variety
of industries, including banking, tourism, and transportation. Mrs. Kuo
currently serves as a Managing Director of Taiwan Allied Container Terminal
Corp., one of the largest container terminals in Taiwan.

         MICHAEL K. HSU, Director. Mr. Hsu has served as a Director of HYMEDIX
since the Acquisition Merger. Mr. Hsu joined HYMEDIX International as a Director
in 1993. Mr. Hsu was the Executive Vice President of First Taiwan Investment
Holding Inc. He was also the Executive Vice President of First Taiwan Venture
Capital and First Taiwan Investment & Development. His position was to lead the
equity investment of the corporate finance segments of First Taiwan Investment
Banking Group, which he co-founded in 1989. Mr. Hsu has had ten years of
experience in the financial service industry, principally in investments and
corporate finance. Prior to 1989 he was the Associate Director of Baring
Research (Taiwan), a subsidiary of Baring Securities Ltd. He started his career
as a manager and a special assistant to the President in China Development Corp,
in 1984. Mr. Hsu holds an M.B.A. degree from National Chiao Tung University and
a B.S. degree from the Tunghai University in Taiwan.

         EDWARD H. JENNINGS, PH.D., Director. Dr. Jennings has been Director of
HYMEDIX since the Acquisition Merger. Dr. Jennings is a Professor of Finance at
The Ohio State University, where he served as President from 1981 to 1990. He
was President of the University of Wyoming from 1979 to 1981, and prior to that
held administrative positions at the University of Iowa and teaching positions
at various universities. Dr. Jennings serves as Chairman of the Board of Mt.
Carmel Hospital and is a Director of Lancaster Colony Corporation, Borden
Chemicals and Plastics Limited Partnership, Super Foods Services, Inc. and HEAF
Corporation. He was previously a Director of Banc One Corporation and Ohio Bell
Corporation.

                                       16

<PAGE>

COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT

         Section 16(a) of the Securities Exchange Act of 1934 (the "Exchange
Act") requires the Company's directors and executive officers, and persons who
own more than ten percent of a registered class of the Company's equity
securities, to file with the Securities and Exchange Commission (the
"Commission") initial reports of ownership and reports of changes in ownership
of Common Stock and other equity securities of the Company. Officers, directors
and greater than ten percent stockholders are required by Commission regulation
to furnish the Company with copies of all Section 16(a) forms they file.

         To the Company's knowledge, based solely on a review of the copies of
such reports furnished to the Company, during fiscal year 2000 all Section 16(a)
filing requirements applicable to its officers, directors and greater than
ten-percent beneficial owners were complied with.

                                       17

<PAGE>

ITEM 10. EXECUTIVE COMPENSATION.

         The table below sets forth certain compensation information for the
fiscal year ended December 31, 2000, 1999 and 1998 with respect to HYMEDIX
Inc.'s ("HYMEDIX's" or the "Company's") Chief Executive Officer.

                                  HYMEDIX, INC.
                           Summary Compensation Table
                               Annual Compensation

                                                                   Long-Term
                                                                  Compensation
                                                                     Awards
                                                   Other Annual   (Securities
Name and Principal                                 Compensation    Underlying
Position                     Year    Salary ($)        ($)         Options (#))
-------------------------    ----    ----------    ------------   -------------

Charles K. Kliment           2000      79,179            0                 0
President and Chief          1999     102,338            0            30,000
Executive Officer            1998     103,500            0                 0


George P. Stoy               2000     126,154            0                 0
Vice President of            1999     102,338            0                 0
Engineering and Director     1998      98,461            0                 0


             Aggregated Option/SAR Exercises in Last Fiscal Year and
                        Fiscal Year End Option/SAR Values

                              Number of Securities
                             Underlying Unexercised
                         Options at Fiscal Year End (#)
                            Exercisable/Unexercisable

Charles K. Kliment                 34,000/34,000
President and Chief
Executive Officer

George P. Stoy                      3,000/3,000
Vice President of
Engineering and Director

         The Company has no pension, retirement, annuity, savings or similar
benefit plan for its executive officers.

                                       18

<PAGE>

Executive Employment and Related Agreements

         Each of the Company's current and former employees and consultants
having access to its proprietary or technical information has executed a
confidentiality and invention assignment agreement with the Company.


         Director Stock Option Plan.

         On June 6, 1996, the Company's stockholders approved the adoption of
the Company's Director Stock Option Plan (the "Director Plan"). The Director
Plan is intended to provide nondiscretionary option grants to independent
Directors of the Company as follows: (i) to those persons already serving on the
Board and who are not employees, an option exercisable for 9,000 shares of the
Company's Common Stock on the effective date of the Director Plan and, for so
long as service on the Board continues, an option of 2,000 shares of the
Company's Common Stock on each anniversary date thereof and (ii) to those
persons joining the Board after the effective date of the Director Plan and who
are not employees, an option exercisable for 5,000 shares of the Company's
Common Stock on the date of election or appointment and, for so long as service
on the Board continues, an option for 2,000 shares of the Company's Common Stock
on each anniversary date of his or her joining the Company's Board, in each case
exercisable at fair market value and subject to certain provisions of
forfeiture. The Director Plan permits the grant of options to purchase up to an
aggregate of 50,000 shares of Common Stock, all of which were reserved for
grants under the Director Plan as of April 15, 1996.

ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.

         The following table sets forth certain information as of March 30, 2001
regarding the beneficial ownership of the Company's Common Stock by: (a) all
those known by the Company to be beneficial owners of more than 5% of its Common
Stock; (b) all Directors; (c) each of the executive officers of the Company
named in the Summary Compensation Table; and (d) all executive officers and
Directors of the Company as a group:

                                                 Shares Beneficially
                                                     Owned (1)
     Name and Address                  --------------------------------------
    of Beneficial Owner                     Number             Percentage
    -------------------                ----------------     -----------------

Kingston Technologies                      1,384,551             22.54%
 Limited Partnership  (2) (3)

First Taiwan Investment                    2,051,078             33.38%
 Holding Inc.  (4)

William G. Gridley, Jr.  (2) (3)           1,429,551             23.09%

George P. Stoy  (2) (3)                    1,387,551             22.41%

Dr. Hsia-Fu Chao  (4) (5)                  2,051,078             33.38%

                                       19

<PAGE>

Shu-Jean Kuo Chou  (4) (6)                 2,051,078             33.38%

Sheng-Hsiung Hsu (4)                              --                --

Michael K. Hsu (4)                                --                --

Edward H. Jennings, Ph.D.                         --                --
 The Ohio State University
 154 W. 12th Street
 Columbus, OH

George P. Stoy (7)                             3,000                 *
 78 Princeton Avenue
 Rocky Hill, NJ

Charles K. Kliment (8)                        34,000                 *
 321 Walnut Lane
 Princeton, NJ

Joseph Mo                                    430,048              7.00%
 One Belleview Terrace
 Princeton, NJ

    All officers and Directors             3,649,900             58.95%
     as a group (8 persons)

* Less than one percent (1%).

(1)      Shares of Common Stock subject to options or warrants exercisable as of
         March 30, 2001 (or exercisable within 60 days after such date), are
         deemed outstanding for purposes of computing the percentage ownership
         of the person holding such option or warrant but are not outstanding
         for purposes of computing the percentage of any other person. Unless
         otherwise indicated in these footnotes, each stockholder has sole
         voting and investment power with respect to the shares beneficially
         owned.

(2)      Includes shares owned of record by Kingston Technologies Limited
         Partnership ("KTLP"). The general partners of KTLP include Vladimir A.
         Stoy, William G. Gridley, jr., George P. Stoy (each a Director of the
         Company) and Oak II, Inc., a corporation controlled by such Directors.
         Each of Vladimir A. Stoy, William G. Gridley, jr., and George P. Stoy
         exercises shares voting and investment power with respect to the shares
         of Common Stock of the Company held by KTLP and disclaims beneficial
         ownership of such shares except to the extent of his partnership
         interest in KTLP. Also gives effect to the exercise by Research
         Corporation Technologies, Inc., a Delaware nonprofit corporation
         ("RCT") and a stockholder of HYMEDIX, of its right to require KTLP to
         transfer and assign without further consideration, that number of
         shares of HYMEDIX Common Stock (166,271 shares) to make RCT's total
         holding of HYMEDIX Common Stock equal to 5% of HYMEDIX's outstanding
         Common Stock on a modified fully diluted basis (excluding shares
         reserved for issuance upon exercise of options granted under the

                                       20

<PAGE>

         HYMEDIX Stock Option Plan and conversion of HYMEDIX Series A Redeemable
         Preferred Stock) upon the effective date of the Company's Registration
         Statement on Form SB-2 (effective August 12, 1995).

(3)      The business address of each of these persons is c/o HYMEDIX, Inc.,
         2245 Route 130, Dayton, New Jersey 08810.

(4)      The business address of each of these persons is 13th Floor, 563 Chung
         Hsiao East Road, Section 4, Taipei, Taiwan 10516.

(5)      Dr. Chao is Chairman of First Taiwan Investment Holding Inc. Based on a
         Schedule 13D dated as of February 23, 1994 filed by First Taiwan
         Investment Holding Inc., First Taiwan Venture Capital Inc., First
         Taiwan Investment and Development, Inc. and Dr. Chao, such persons may
         be deem to form collectively a "group" and each of such persons may be
         deemed to share voting power with each other with regard to the
         foregoing shares. Dr. Chao, in his capacity as Chairman of First Taiwan
         Investment Holding Inc., may also be deemed to share dispositive power
         over the shares of Common Stock owned of record by or issuable to First
         Taiwan Investment Holding Inc., Dr. Chao disclaims beneficial ownership
         of all such shares, except to the extent of this investment interest
         therein.

(6)      Ms. Chou is a Director of FTIHI. Ms. Chou disclaims beneficial
         ownership of all such shares, except to the extent of her investment
         interest therein.

(7)      Includes 3,000 shares of Common Stock that Mr. Stoy has the right to
         acquire upon the exercise of stock options.

(8)      Includes 34,000 shares of Common Stock that Dr. Kliment has the right
         to acquire upon the exercise of stock options.

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

         In April 1996, the Company issued convertible bonds in the aggregate
principal amount of approximately $981,000 (the "June Bonds") pursuant to a
Convertible Bond Purchase Agreement effective February 27, 1996, by and among
the Company, HYMEDIX International, First Taiwan Investment and Development,
Inc. and the Purchasers (as defined therein). The June Bonds bear interest at a
rate of 7% per annum and matured (after being extended) on December 31, 1997.
The June Bonds are convertible in whole or in part at any time prior to payment
or prepayment into one thousand (1,000) shares of common stock of the Company
for each one thousand dollars ($1,000) of principal amount outstanding. Interest
on the June Bonds is payable at maturity or upon prepayment or conversion
thereof.

                                       21

<PAGE>

                                   SIGNATURES


         In accordance with Section 13 or 15(d) of the Exchange Act, the
registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.

                                  HYMEDIX, INC.
                                  (Registrant)

                                  By: /s/ CHARLES K. KLIMENT, PH.D.
                                      ---------------------------------------
                                      Charles K. Kliment, Ph.D.
                                      President (Principal Executive Officer)
                                  Date:  March 30, 2001


         In accordance with the Exchange Act, this report has been signed below
by the following persons on behalf of the registrant and in the capacities and
on the dates indicated.

              SIGNATURE                     TITLE                     DATE


By: /s/ CHARLES K. KLIMENT            President, (Principal       March 30, 2001
    ------------------------------    Executive Officer)
    Charles K. Kliment


By: /s/ WILLIAM G. GRIDLEY, JR.       Chairman, Chief Financial   March 30, 2001
    ------------------------------    Officer (Secretary, Treasurer,
    William G. Gridley, jr.           Principal Financial Officer
                                      and Principal Accounting
                                      Officer); Director


By: /s/ GEORGE P. STOY                Director                    March 30, 2001
    ------------------------------
    George P. Stoy


By: /s/ EDWARD H. JENNINGS            Director                    March 30, 2001
    ------------------------------
    Edward H. Jennings


By: /s/ SHENG-HSIUNG HSU              Director                    March 30, 2001
    ------------------------------
    Sheng-Hsiung Hsu


By: /s/ DR. HSIA-FU CHAO              Director                    March 30, 2001
    ------------------------------
    Dr. Hsia-Fu Chao


By: /s/ SHU-JEAN KUO CHOU             Director                    March 30, 2001
    ------------------------------
    Shu-Jean Kuo Chou


By: /s/ MICHAEL K. HSU                Director                    March 30, 2001
    ------------------------------
    Michael K. Hsu

                                       22

<PAGE>
                          HYMEDIX, INC. AND SUBSIDIARY

                        CONSOLIDATED FINANCIAL STATEMENTS

                         DECEMBER 31, 1999 AND 1998 AND
                           FOR EACH OF THE THREE YEARS
                      IN THE PERIOD ENDED DECEMBER 31, 2000
                         TOGETHER WITH AUDITORS' REPORT

<PAGE>

                          HYMEDIX, INC. AND SUBSIDIARY

                          INDEX TO FINANCIAL STATEMENTS


                                                                        PAGE


Independent Accountants Auditors' Report                                 F-3


Consolidated Financial Statements:

     Consolidated Balance Sheets as of December 31, 2000 and 1999        F-4


     Consolidated Statements of Operations for the
       Years ended December 31, 2000, 1999 and 1998                      F-5


     Consolidated Statements of Changes in Stockholders' Deficit
       for the Years ended December 31, 2000, 1999 and 1998              F-6


     Consolidated Statements of Cash Flows for the
       Years ended December 31, 2000, 1999 and 1998                      F-7


Notes to Consolidated Financial Statements                            F-8 - F-20

                                       F-2

<PAGE>

                    INDEPENDENT ACCOUNTANTS AUDITORS' REPORT


To the Board of Directors and
Stockholders of HYMEDIX, Inc. and Subsidiary

We have audited the accompanying consolidated balance sheet of HYMEDIX, Inc. (a
Delaware corporation) and subsidiary (the "Company") as of December 31, 2000,
and the related consolidated statements of operations, changes in stockholders'
deficit and cash flows for the year then ended. These consolidated financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these consolidated financial
statements based on our audit. The consolidated financial statements of HYMEDIX,
Inc. and subsidiary as of December 31, 1999 and for each of the two years in the
period ended December 31, 1999, were audited by other auditors whose report
dated March 14, 2000, on those statements included an explanatory paragraph that
described the substantial doubt the Company's ability to continue as a going
concern as discussed in Note 3 to the consolidated financial statements.

We conducted our audit in accordance with auditing standards generally accepted
in the United States of America. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the consolidated
financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the consolidated 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
audit provides a reasonable basis for our opinion.

In our opinion, the year 2000 consolidated financial statements referred to
above present fairly, in all material respects, the financial position of
HYMEDIX, Inc. and subsidiary as of December 31, 2000, and the results of their
operations and their cash flows for the year then ended in conformity with
accounting principles generally accepted in the United States of America.

The accompanying consolidated financial statements have been prepared assuming
that the Company will continue as a going concern. The Company incurred a loss
from operations in each of the last three years, has a working capital deficit,
has a net capital deficiency and is not in compliance with certain loan
provisions at December 31, 2000. These factors raise substantial doubt about the
Company's ability to continue as a going concern. Management's plans in regard
to these matters are described in Note 3. The consolidated financial statements
do not include any adjustments relating to the recoverability and classification
of asset carrying amounts or the amount and classification of liabilities that
might result should the Company be unable to continue as a going concern.


March 10, 2001
O'Connor Davies Munns & Dobbins, LLP

                                      F-3

<PAGE>

                          HYMEDIX, INC. AND SUBSIDIARY

                           CONSOLIDATED BALANCE SHEETS

                           DECEMBER 31, 2000 AND 1999
<TABLE>
<CAPTION>

                                                                       2000            1999
                                                                   ------------    ------------
                                     ASSETS
<S>                                                                <C>             <C>
Current assets
  Cash and cash equivalents                                        $    181,282    $    356,003
  Accounts receivable                                                    56,885          87,035
  Note receivable from related party                                     20,000         203,600
  Inventories, net                                                       67,097          70,921
  Receivable from net operating loss sale                                               317,482
  Other current assets                                                   50,520          73,393
                                                                   ------------    ------------

        Total current assets                                            375,784       1,108,434

Property and equipment, net of accumulated
  depreciation of $742,932 and $735,800
  in 2000 and 1999, respectively                                         59,658             896
Patents, net of accumulated amortization of $440,587
  and $409,950 in 2000 and 1999, respectively                                            30,637
Security deposit                                                         59,040          59,040
                                                                   ------------    ------------
        Total assets                                               $    494,482    $  1,199,007
                                                                   ============    ============

                      LIABILITIES AND STOCKHOLDERS' DEFICIT

Current liabilities
  Notes payable                                                    $  3,946,979    $  3,946,979
  Accounts payable and accrued expenses                               4,703,262       4,359,876
  Accrued legal judgement and settlement                                 75,000         275,000
                                                                   ------------    ------------

        Total current liabilities                                     8,725,241       8,581,855
                                                                   ------------    ------------

Accrued legal judgement and settlement                                  137,500         212,500
                                                                   ------------    ------------

Commitments and contingencies

Stockholders' deficit
  8% senior convertible preferred stock, $3.00 par value,
  800,000 shares authorized, 7,390 shares issued and outstanding         22,170          22,170
Preferred stock, $.01 par value, 3,000 shares authorized,
  150 shares issued and outstanding                                           2               2
Common stock, $.001 par value, 20,000,000 shares authorized,
  6,143,781 shares issued and outstanding                                 6,144           6,144
Additional paid-in capital                                           15,658,743      15,658,743
Accumulated deficit                                                 (22,555,318)    (21,782,407)
Subscription receivable                                              (1,500,000)     (1,500,000)
                                                                   ------------    ------------

        Total stockholders' deficit                                  (8,368,259)     (7,595,348)
                                                                   ------------    ------------

        Total liabilities and stockholders' deficit                $    494,482    $  1,199,007
                                                                   ============    ============
</TABLE>

See accountants' report and accompanying notes to consolidated financial
statements.

                                       F-4

<PAGE>

                          HYMEDIX, INC. AND SUBSIDIARY

                      CONSOLIDATED STATEMENTS OF OPERATIONS

                  YEARS ENDED DECEMBER 31, 2000, 1999 AND 1998

<TABLE>
<CAPTION>

                                                 2000           1999           1998
                                             -----------    -----------    -----------
<S>                                          <C>            <C>            <C>
Revenues
  Net product sales                          $   635,202    $   763,592    $ 1,138,083
  License, royalty and distribution fees          41,492        286,958        256,082
  Research and development contracts              90,500        175,000        257,500
                                             -----------    -----------    -----------

        Total revenues                           767,194      1,225,550      1,651,665
                                             -----------    -----------    -----------

Costs and expenses
  Cost of sales                                  169,809        312,453        388,630
  Selling, general and administrative            938,770      1,404,237      1,191,316
  Research and development                       378,730        475,117        440,835
  Legal judgement and settlement                                              (234,164)
                                             -----------    -----------    -----------

        Total costs and expenses               1,487,309      2,191,807      1,786,617
                                             -----------    -----------    -----------

        Loss from operations                    (720,115)      (966,257)      (134,952)
                                             -----------    -----------    -----------

Other income (expense)
  Loss on sale of assets                         (12,460)                       (6,561)
  Interest expense                              (286,185)      (312,906)      (251,091)
  Other income                                   382,623      1,669,442         97,073
                                             -----------    -----------    -----------

        Total other income (expense), net         83,978      1,356,536       (160,579)
                                             -----------    -----------    -----------

        Net income (loss)                    $  (636,137)   $   390,279    $  (295,531)
                                             ===========    ===========    ===========

Basic earnings (loss) per common share:      $     (0.13)   $      0.04    $     (0.08)

Diluted earnings (loss) per common share:    $     (0.13)   $      0.04    $     (0.08)

Weighted average common shares outstanding     6,143,781      6,036,211      5,713,500
</TABLE>

See accountants' report and accompanying notes to consolidated financial
statements.

                                       F-5

<PAGE>

                          HYMEDIX, INC. AND SUBSIDIARY

           CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' DEFICIT

                  YEARS ENDED DECEMBER 31, 2000, 1999 AND 1998

<TABLE>
<CAPTION>

                                    8% Senior Convertible
                                       Preferred Stock     Preferred Stock        Common Stock                       Accumulated
                                    -------------------  -------------------  --------------------                     Other
                                     Number               Number               Number                 Additional    Comprehensive
                                       of                   of                   of                    Paid-in         Income
                                     Shares     Amount    Shares     Amount    Shares      Amount      Capital         (Loss)
                                    --------   --------  --------   --------  ---------   --------   ------------    -----------
<S>                                  <C>       <C>            <C>   <C>       <C>         <C>        <C>             <C>
Balance, December 31, 1997           10,190    $ 30,570       150   $      2  5,713,500   $  5,713   $ 15,642,174    $  (53,531)

  Net loss - 1998
  Preferred stock dividends
  Unrealized gain from available
    for sale investments                                                                                                 53,531
  Issuance of warrants                                                                                      4,300
                                     ------    --------  --------   --------  ---------   --------   ------------    ----------
        Comprehensive loss

Balance, December 31, 1998           10,190      30,570       150          2  5,713,500      5,713     15,646,474

  Net income - 1999
  Preferred stock dividends
  Preferred stock conversion         (2,800)     (8,400)                            233                     8,400
  Exercise of warrants                                                          430,048        431          3,869
                                     ------    --------  --------   --------  ---------   --------   ------------    ----------
        Comprehensive income

Balance, December 31, 1999            7,390      22,170       150          2  6,143,781      6,144     15,658,743

  Net loss - 2000
  Preferred stock dividends
                                     ------    --------  --------   --------  ---------   --------   ------------    ----------
        Comprehensive loss

Balance, December 31, 2000            7,390    $ 22,170       150   $      2  6,143,781   $  6,144   $ 15,658,743    $       --
                                     ======    ========  ========   ========  =========   ========   ============    ==========
</TABLE>

                                     Accumulated      Subscription
                                       Deficit         Receivable
                                    -------------     ------------

Balance, December 31, 1997          $ (21,602,935)    $ (1,500,000)

  Net loss - 1998                        (295,531)
  Preferred stock dividends              (137,446)
  Unrealized gain from available
    for sale investments
  Issuance of warrants
                                    -------------     ------------
        Comprehensive loss

Balance, December 31, 1998            (22,035,912)      (1,500,000)

  Net income - 1999                       390,279
  Preferred stock dividends              (136,774)
  Preferred stock conversion
  Exercise of warrants
                                    -------------     ------------
        Comprehensive income

Balance, December 31, 1999            (21,782,407)      (1,500,000)

  Net loss - 2000                        (636,137)
  Preferred stock dividends              (136,774)
                                    -------------     ------------
        Comprehensive loss

Balance, December 31, 2000          $ (22,555,318)    $ (1,500,000)
                                    =============     ============

See accountants' report and accompanying notes to consolidated financial
statements.

                                       F-6

<PAGE>

                 HYMEDIX, INC. AND SUBSIDIARY

                CONSOLIDATED STATEMENTS OF CASH FLOWS

             YEARS ENDED DECEMBER 31, 2000, 1999 AND 1998

<TABLE>
<CAPTION>
                                                         2000         1999         1998
                                                       ---------    ---------    ---------
<S>                                                    <C>          <C>          <C>
Cash flow from operating activities
  Net income (loss)                                    $(636,137)   $ 390,279    $(295,531)
  Adjustments to reconcile net income (loss) to net
    cash provided (used) by operating activities
      Depreciation and amortization                       37,769       35,799       55,853
      Issuance of warrants                                                           4,300
      Loss on sale of assets                              12,460                     6,561
      Reserve for inventory obsolescence                (125,000)     100,000
      (Increase) decrease in
        Accounts receivable                               30,150      (86,818)     226,432
        Note receivable from related party               183,600     (156,960)     (46,640)
        Inventories                                      128,824       (8,375)      73,200
        Receivable from net operating loss sale          317,482     (317,482)
        Other current assets                              56,081      (16,579)      (1,822)
        Security deposit                                                           (59,040)
      Increase (decrease) in
        Accounts payable and accrued expenses            206,612      566,503      118,662
        Accrued legal judgement and settlement, net     (275,000)     (80,000)    (238,464)
                                                       ---------    ---------    ---------

          Net cash provided (used) by
             operating activities                        (63,159)     426,367     (156,489)
                                                       ---------    ---------    ---------

Cash flows from investing activities
  Purchase of property and equipment                     (83,369)                   (1,378)
  Proceeds from sale of equipment                          5,015                   152,439
                                                       ---------    ---------    ---------

         Net cash provided (used) by
            investing activities                         (78,354)          --      151,061
                                                       ---------    ---------    ---------

Cash flows from financing activities
  Proceeds from exercise of warrants                                    4,300
  Principal repayments of notes payable                              (100,000)     (20,617)
                                                       ---------    ---------    ---------

        Net cash used by financing activities                 --      (95,700)     (20,617)
                                                       ---------    ---------    ---------

Net increase (decrease) in cash and cash equivalents    (174,721)     330,667      (26,045)

Cash and cash equivalents, beginning of year             356,003       25,336       51,381
                                                       ---------    ---------    ---------

Cash and cash equivalents, end of year                 $ 181,282    $ 356,003    $  25,336
                                                       =========    =========    =========

Supplemental disclosures of cash flow information
  Interest paid                                        $      --    $      --    $   2,383

  Income tax paid                                      $      --    $  55,000    $      --
</TABLE>


See accountants' report and accompanying notes to consolidated financial
statements.

                                       F-7

<PAGE>

                          HYMEDIX, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


1.      NATURE OF OPERATIONS

        HYMEDIX, Inc. (the "Company") is engaged primarily in the development
        and commercialization of biomedical and skin care products based on
        proprietary advanced hydrogels. These hydrophilic polymers are
        biocompatible and highly versatile, and enable the Company to develop
        and manufacture products and components with many characteristics for a
        variety of medical products and other markets. For the years ended
        December 31, 2000, 1999 and 1998, two of the Company's product lines
        encompassed over 99%, 92% and 71% of net product sales, respectively.
        For the year ended December 31, 2000, two of the Company's customers
        accounted for 42% and 32% of total revenues. For the year ended December
        31, 1999, two of the Company's customers accounted for 72% and 20% of
        the total revenues. For the year ended December 31, 1998, two of the
        Company's customers accounted for 47% and 17% of total revenues. As of
        December 31, 2000, 97% of accounts receivable were due from the two
        customers who accounted for 74% of total revenues in the year 2000.

        The accompanying consolidated 2000, 1999 and 1998 financial statements
        include the accounts of the Company and HYMEDIX International, Inc. its
        wholly owned subsidiary. All significant intercompany transactions have
        been eliminated in consolidation.

2.      SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

        USE OF ESTIMATES

        The preparation of financial statements in conformity with generally
        accepted accounting principles requires management to make estimates and
        assumptions that affect the reported amounts of assets and liabilities
        and 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. Actual results could differ from those
        estimates.

        REVENUES AND COST RECOGNITION

        Revenues are derived primarily from the sales of hydrogels and skin care
        products, option and license agreements and research and development
        contracts. Such revenues are recognized upon shipment of products and/or
        when all significant obligations of the Company have been satisfied. The
        costs associated with the option fees and license fees and research and
        development expenses are recognized as incurred.

                                      F-8

<PAGE>

                          HYMEDIX, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Continued)


2.      SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES  (CONTINUED)

        CASH AND CASH EQUIVALENTS

        Cash and cash equivalents consists of highly liquid, short-term
        investments with maturities of three months or less.

        INVENTORIES

        Inventories are stated at the lower of cost (determined on a first-in,
        first-out basis) or market and include material, labor and overhead
        costs. As of December 31, inventories are comprised as follows:

                                                        2000        1999
                                                     ---------    ---------

             Raw materials                           $   7,709    $  86,676
             Work in process                             4,920        6,396
             Finished goods                            129,468      177,849
                                                     ---------    ---------
                                                       142,097      270,921
             Less:  reserve for obsolete inventory     (75,000)    (200,000)
                                                     ---------    ---------

                                                     $  67,097    $  70,921
                                                     =========    =========

        PROPERTY AND EQUIPMENT

        Property and equipment are stated at cost, less accumulated
        depreciation. Depreciation is provided over the estimated useful lives
        of the assets ranging from three to five years.

        PATENTS

        Patents are amortized using the straight-line method over a 14-year
        period. As of December 31, 2000, all patents are fully amortized.

        STOCK-BASED COMPENSATION

        The Company accounts for employee stock-based compensation using the
        intrinsic value method.

                                      F-9

<PAGE>

                          HYMEDIX, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Continued)


2.      SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES  (CONTINUED)

        EARNINGS (LOSS) PER COMMON SHARE

        The Company has adopted SFAS No. 128, "Earnings Per Share", ("SFAS 128")
        which requires presentation in the consolidated statements of operations
        of both basic and diluted earnings (loss) per share. Basic earnings
        (loss) per share is computed by dividing the net income (loss) for the
        period, after consideration of dividends related to preferred stock,
        where applicable, by the weighted average number of common shares
        outstanding. Net income (loss) available to common stockholders
        represents the net loss increased by preferred stock dividends ($136,774
        and $137,446) for the year ended December 31, 2000 and 1998,
        respectively, and net income decreased by preferred stock dividends
        ($136,774) for the year ended December 31, 1999. None of the common
        shares issuable under either the Company's stock option plan, or the
        conversion of the preferred stock, bonds or outstanding warrants (which
        aggregated 1,609,327 as of December 31, 2000) were included in the
        computation of earnings (loss) per common share assuming dilution
        because their inclusion would have been antidilutive. Thus, there is no
        difference between the weighted average common shares outstanding to
        weighted average common shares outstanding assuming dilution.

3.      BASIS OF PRESENTATION

        The Company incurred a loss from operations in each of the last three
        years ended December 31, 2000. The Company also has a working capital
        deficit, has a net capital deficiency and is not in compliance with
        certain loan provisions at December 31, 2000.

        Management is not certain that the Company will have adequate resources
        to finance its operations in 2001. In addition, a judgement in the
        amount of $367,500 has been rendered against the Company (see Note 12).
        Financing the judgement as well as the Company's operations will be
        difficult. Management plans to continue to seek and evaluate financing
        alternatives for the Company. In the event that cash flow from
        operations and the anticipated proceeds from the financing, if any, are
        not sufficient to fund the Company's operations and obligations in 2001,
        there is no assurance that other sources of funds will be available to
        the Company. These factors raise substantial doubt about the Company's
        ability to continue as a going concern. The consolidated financial
        statements do not include any adjustments relating to the recoverability
        and classification of asset carrying amounts or the amount and
        classification of liabilities that might result should the Company be
        unable to continue as a going concern.

                                      F-10

<PAGE>

                          HYMEDIX, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Continued)


4.      RELATED PARTY TRANSACTIONS

        The Company entered into a license agreement with S.K.Y. Polymers, Inc.
        ("SKY"), an entity controlled by one of the Company's directors, to
        obtain rights with respect to the use of SKY's technology. SKY received
        $2,000 per month for license maintenance fees until the agreement
        terminated on October 31, 1998.

        A portion of the Company's convertible bonds are held by First Taiwan,
        the majority stockholder of the Company. These bonds, bear interest at
        7% payable upon demand and are secured by substantially all the assets
        of the Company (see Note 7).

        The Company is the general partner of Kingston Diagnostics, L.P.
        ("Kingston"). The Company has recorded a note receivable from Kingston
        related to the collection of a receivable previously written off by the
        Company in a prior year (see Note 13).

5.      PROPERTY AND EQUIPMENT

        At December 31, property and equipment is as follows:

                                                            2000         1999
                                                         ---------    ---------

           Machinery and equipment                       $ 181,409    $ 124,753
           Office equipment and furniture and fixtures      31,617       22,379
           Leasehold improvements                          589,564      589,564
                                                         ---------    ---------
                                                           802,590      736,696
           Less:  accumulated depreciation                (742,932)    (735,800)
                                                         ---------    ---------

                                                         $  59,658    $     896
                                                         =========    =========

        Depreciation and amortization of property and equipment was $7,132 and
        $4,359 in 2000 and 1999, respectively.

                                      F-11

<PAGE>

                          HYMEDIX, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Continued)


6.      ACCOUNTS PAYABLE AND ACCRUED EXPENSES

        At December 31, accounts payable and accrued expenses consists of:

                                                  2000          1999
                                               ----------    ----------

         Accounts payable                      $  282,579    $  264,805
         Accrued compensation                     271,599       344,719
         Accrued interest payable               1,721,216     1,453,486
         Accrued preferred dividends              940,817       804,044
         Refundable option deposit                 99,000        99,000
         Deferred income (see Note 9)           1,214,540     1,208,000
         Other accrued expenses                   173,510       185,822
                                               ----------    ----------

                                               $4,703,261    $4,359,876
                                               ==========    ==========

7.      NOTES PAYABLE

        Notes payable consists of the following as of December 31:

                                                           2000          1999
                                                        ----------    ----------
        Note payable, bearing interest at 7%,
           interest only payable quarterly,
           matures in January 2007, unsecured
           (a) (see Note 9).                            $1,500,000    $1,500,000

        Note payable, bearing interest at 7%,
           interest only payable semiannually,
           payable on demand, secured by a
           patent (a) (see Note 9).                        900,000       900,000

        Convertible bonds, bearing interest at 7%,
           payable on demand, secured by sub-
           stantially all the assets of the
           Company (b).                                  1,015,136     1,015,136


                                      F-12

<PAGE>

                          HYMEDIX, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Continued)


7.      NOTES PAYABLE  (CONTINUED)

                                                        2000             1999
                                                     ----------       ----------

        Note payable, bearing interest at 3%,
           payable on demand, unsecured              $  458,326       $  458,326

        Note payable, bearing interest at 8%,
           payable on demand, unsecured                  72,317           72,317

        Demand note payable, bearing interest at
           10%, interest payable periodically,
           unsecured                                      1,200            1,200
                                                     ----------       ----------

                                                     $3,946,979       $3,946,979
                                                     ==========       ==========

        (a)   During 2000, 1999 and 1998, the Company has not made interest
              payments in accordance with the terms of the note payable
              agreement. As a result, the Company is in technical default with
              the agreement and therefore, the related debt has been classified
              as a current liability in the accompanying consolidated balance
              sheets.

        (b)   During 1996, the Company issued convertible bonds in the principal
              amount of $1,131,000. The bonds are convertible into 1,131,000
              shares of the Company's common stock. Such shares have been
              reserved by the Company. The bonds may be subject to mandatory
              prepayment under certain conditions. Certain proceeds from the
              bond issuance are held by a representative of the bondholders
              (agent). The Company's ability to borrow such proceeds is subject
              to approval by the agent. The bonds were originally due June 1,
              1997, however, the due date was extended and the balance
              outstanding is due on demand.

8.      INCOME TAXES

        The Company provides for taxes under SFAS No. 109, "Accounting for
        Income Taxes", ("SFAS 109") which requires recognition of deferred tax
        liabilities and assets for the expected future tax consequences of
        events that have been included in the financial statements or tax
        returns.

                                      F-13

<PAGE>

                          HYMEDIX, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Continued)


8.      INCOME TAXES  (CONTINUED)

        In accordance with SFAS 109, the Company has evaluated its ability to
        realize the future tax benefits associated with its net operating loss
        carryforwards. At December 31, 2000, the Company had net operating loss
        carryforwards of approximately $15,700,000 for Federal income tax
        purposes, which expire through 2021. Based on its operating history, the
        Company has provided a valuation allowance of approximately $5,900,000
        as a full valuation allowance against the deferred tax asset as of
        December 31, 2000 because it could not determine that it was more likely
        than not that such benefits would be realized.

        As a result of a previous recapitalization, a change in ownership, as
        defined for tax purposes, has occurred which will restrict the use of
        net operating loss carryforwards. The maximum amount of net operating
        losses incurred prior to the change in ownership (approximately
        $5,000,000) which can be utilized in any given year is approximately
        $1,300,000.

9.      SIGNIFICANT AGREEMENTS

        The Company granted a license agreement covering the exclusive rights to
        all surgically applied eye care products developed by the Company to
        Optical Radiation Corporation (ORC). ORC subsequently assigned these
        rights to another company which is active in the intraocular lenses
        business. In 1987, the Company received $1,500,000 in licensing fees and
        a loan of $1,500,000, (see Note 7) as up-front payments stipulated by
        the agreement. In connection with the license agreement, the Company may
        receive royalties based on a percentage of sales of those products
        associated with the agreement. The Company earned approximately $-0-,
        $268,000 and $250,000 of royalties under this agreement for the years
        ended December 31, 2000, 1999 and 1998, respectively. During 1999, the
        Company transferred all rights, title and interest to the patent rights,
        as defined, to the company ORC assigned their rights for $1,450,000. The
        full amount has been received by the Company as of December 31, 1999.
        Due to the fact that the Company has not satisfied all of its
        obligations under the agreement, as defined, $1,208,000 of the proceeds
        was recorded as deferred income (see Note 6).

                                      F-14

<PAGE>

                          HYMEDIX, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Continued)


9.      SIGNIFICANT AGREEMENTS (CONTINUED)

        The Company granted an exclusive license for its soft contact lens
        products in October 1989 to Pilkington Visioncare, Inc. (PVI). In
        consideration thereof, the Company obtained a $1,000,000, 7% ten-year
        interest only loan from PVI (see Note 7). No soft contact lens products
        have been completed, and no royalties have been received or earned under
        this license agreement. In 1999, the Company entered into an agreement
        with Wesley Jessen Corporation ("WJC"), the parent Company of PVI, to
        reduce the original loan to $500,000. Due to the fact that the Company
        has not satisfied all of its obligations under the agreement, the full
        value of the original loan, reduced by 1999 principal payments of
        $100,000 is reflected in the accompanying consolidated balance sheets.

        In 1991, the Company entered into a Development Services and Licensing
        Agreement with a medical products company. Under this agreement and
        subsequent extensions, the medical products company has paid the Company
        $100,000 in fees for each of the years ended December 31, 1998 and 1999
        and $-0- for the year ended December 31, 2000. These amounts have been
        reflected in research and development contract revenues in the
        accompanying consolidated statements of operations.

        During August 1995, the Company entered into a distribution and
        licensing agreement with Europa Magnetics Corporation Limited (EMC), a
        company affiliated with a stockholder of the Company. The agreement
        gives EMC the exclusive right to market and distribute the Company's
        skin care and wound care products in Asia. Under this agreement, if EMC
        manufactures products in Asia, it would pay the Company up to a 7%
        royalty on all partially or fully manufactured skin care and wound care
        products produced in Asia. No royalties have been received or earned
        through December 31, 2000.

10.     COMMITMENTS AND CONTINGENCIES

        The Company leases certain office and manufacturing facilities under
        arrangements accounted for as operating leases. Rent expense
        approximated $362,000, $365,000 and $560,000 for the years ended
        December 31, 2000, 1999 and 1998, respectively. These leases require the
        Company to pay all executory costs such as property taxes, maintenance
        and insurance. The aggregate minimum lease payments of all
        noncancellable leases as of December 31, 2000 are as follows:

              For the Years Ending December 31,              Amount
              ---------------------------------             --------
                         2001                               $363,000
                         2002                                361,000
                         2003                                177,000

                                      F-15

<PAGE>

                          HYMEDIX, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Continued)


11.     STOCKHOLDERS' DEFICIT

        During 1994, the Company issued $1,500,000 of 9% preferred stock to
        Research Corporation Technologies, Inc. ("RCT"), which has a 20%
        interest in the Company's royalties under certain exclusive lens
        products licenses, in exchange for the right to receive the first
        $1,500,000 of royalties due to RCT. The $1,500,000 due from RCT is
        reflected as a subscription receivable at December 31, 2000 and 1999.
        The preferred stock is redeemable by the Company (but not by RCT) in six
        years, and is convertible after June 30, 1995 into the Company's common
        stock at $5.75 a share, with the Company having the right to redeem the
        preferred stock if RCT elects to convert.

        The Company maintains an Employee Stock Option Plan (the "Option Plan")
        and is authorized to grant options at fair value to purchase up to
        500,000 shares of the Company's stock. The options are exercisable in
        varying percentages.

        Transactions under the Option Plan are as follows:
<TABLE>
<CAPTION>

                                                                                  Shares            Weighted
                                                                                  Under              Average
                                                                                  Option         Exercise Price
                                                                                 --------        --------------
<S>                                                                               <C>                 <C>
        Outstanding December 31, 1996 (exercisable 323,419 shares)                418,919             $3.11
             Expired                                                              (52,748)            $2.85
                                                                                 --------
        Outstanding December 31, 1997 (exercisable 300,421 shares)                366,171             $3.15
             Expired                                                              (44,466)            $3.20
                                                                                 --------
        Outstanding December 31, 1998 (exercisable 321,705 shares)                321,705             $3.14
             Granted                                                               30,000             $0.02
             Expired                                                              (59,000)            $5.58
                                                                                 --------
        Outstanding December 31, 1999 (exercisable 292,705 shares)                292,705             $2.33
             Expired                                                              (92,593)            $3.20
                                                                                 --------
        Outstanding December 31, 2000 (exercisable 200,112 shares)                200,112             $1.92
                                                                                 ========
</TABLE>

                                      F-16

<PAGE>

                          HYMEDIX, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Continued)


11.     STOCKHOLDERS' DEFICIT  (CONTINUED)

        The following table summarizes information about stock options
        outstanding at December 31, 2000:
<TABLE>
<CAPTION>

                                              Weighted     Weighted                     Weighted
             Range of          Number         Average      Average        Number        Average
             Exercise        Outstanding     Remaining     Exercise     Exercisable     Exercise
              Prices         at 12/31/00        Life        Price       at 12/31/00      Price
        ------------------   -----------     ---------     --------     -----------     --------
<S>                            <C>                <C>        <C>           <C>           <C>
        $0.02 to $1.99         116,000            7          $0.56         116,000       $0.56
        $2 to $3.99             79,112            1          $3.66          79,112       $3.66
        $4 to $5.99              3,000            4          $4.75           3,000       $4.75
        $6 to $12                2,000            4          $8.00           2,000       $8.00
</TABLE>

        In accordance with SFAS No. 123, "Accounting for Stock-Based
        Compensation" ("SFAS 123"), the fair value of option grants is estimated
        on the date of grant using the Black-Scholes option pricing model for
        proforma footnote purposes with the following assumptions used for
        grants; dividend yield 0%, risk-free interest rate of 5.0% for 2000 and
        expected option life of ten years. Expected volatility was assumed to be
        100% for 2000. The weighted average fair value of options granted was
        $.0376 in 1999. There were no grants made during 2000 or 1998.

        As permitted by SFAS 123, the Company has chosen to continue accounting
        for stock options at their intrinsic value. Accordingly, no compensation
        expense has been recognized for its stock option compensation. Had the
        fair value method of accounting been applied to the Company's stock
        option plans, the tax-effected impact would be as follows:
<TABLE>
<CAPTION>

                                                             2000          1999          1998
                                                          ---------     ---------     ---------
<S>                                                       <C>           <C>           <C>
        Net income (loss) as reported                     $(669,345)    $ 390,279     $(295,531)
        Estimated fair value of the year's option
           grants, net of tax                                               1,128
                                                          ---------     ---------     ---------

        Net income (loss) adjusted                        $(669,345)    $ 389,151     $(295,531)
                                                          =========     =========     =========

        Adjusted basic and diluted net
           income (loss) per share                        $    (.13)    $     .08     $    (.21)
</TABLE>

                                      F-17

<PAGE>

                          HYMEDIX, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Continued)



11.     STOCKHOLDERS' DEFICIT  (CONTINUED)

        This proforma impact only takes into account options granted since
        January 1, 1995 and is likely to increase in future years as additional
        options are granted and amortized ratably over the vesting period.

        The Company had outstanding warrants entitling the holders thereof to
        purchase 40,000 common shares. The warrants had exercisable at $3.00 per
        share, subject to certain adjustments, as defined, and expired through
        January 19, 2000, unexercised.

12.     LITIGATION

        The Company's former president filed a claim against the Company, the
        Company's Directors and Kingston Technologies Limited Partnership (a
        stockholder). The complaint, filed in September 1993, alleged that the
        Company wrongfully terminated the former president, that he was owed
        $367,500 in deferred compensation and $74,500 in back salary and that
        approximately $323,000 was owed him based on his claim that an agreement
        signed by him was signed under duress and is therefore void. The Company
        filed an answer denying most of the former president's claims for
        relief. The Company paid $74,500 in 1994 resulting in the parties
        settling the claim regarding back salary. In July 1996, a judgement was
        rendered against the Company in the amount of $805,964 plus interest in
        connection with this case. In April 1998, $438,464 of the judgement was
        reversed on appeal. The $367,500 claim for deferred compensation was
        affirmed by the Appellate Court. Accordingly, the Company reversed
        $438,464 of the accrued legal judgement plus related accrued interest in
        1998. In July 1999, the Company reached an agreement to reduce the
        judgement to $350,000, with the forgiveness of all accrued interest, to
        be paid in monthly payments over the next four years. During the years
        ended December 31, 2000 and 1999, $75,000 and $80,000 were paid,
        respectively. The agreement stipulates that if any monthly payments are
        in default, as defined, the judgement will revert back to $367,500 and
        full payment of accrued interest. The Company has not reflected the
        reduction in the judgement and accrued interest as of December 31, 2000,
        due to the Company's financial condition. The Company has accrued the
        affirmed judgement plus interest in the accompanying consolidated
        financial statements as of December 31, 2000.


                                      F-18

<PAGE>

                          HYMEDIX, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Continued)



12.     LITIGATION  (CONTINUED)

        An individual filed a complaint against the Company alleging that the
        Company owed him eight percent of all monies invested in the Company as
        a result of his contacts. The complaint alleged that the Company owed
        him approximately $5,000,000 and warrants to purchase the Company's
        common stock. In December 1998, a settlement agreement was signed by the
        individual, the Company and First Taiwan and its affiliates. The Company
        agreed to pay the individual $200,000 plus interest over a thirty-six
        month period commencing January 1, 2000. In January 2000, the full
        amount of $200,000 was paid. In addition, the Company agreed to issue
        warrants to purchase the equivalent of seven percent of the issued and
        outstanding common stock of the Company as of November 30, 1998 (430,048
        shares) giving effect to an inclusion of the common stock underlying the
        warrants as though all of the warrants issued under the settlement were
        exercised. The warrants may be exercised by the individual, in whole or
        in part or parts at any time during a ten year period commencing January
        23, 1999 and ending on January 22, 2009, and have an exercise price of
        $.01 per warrant. The warrants and the common stock issued provide for
        an anti-dilution adjustment in the event of any change in the
        capitalization of the Company which would otherwise dilute the warrants
        or the common stock. The Company valued the warrants at their estimated
        fair value of $4,300 using the Black Scholes method. Such warrants were
        exercised during 1999 for $4,300.

        The settlement agreement also provides the Company the option to
        purchase all or part common stock issued to the individual pursuant to
        the settlement agreement if the market capitalization of the Company
        exceeds $15,000,000.

13.     OTHER INCOME

        For the years ended December 31, other income consists of:
<TABLE>
<CAPTION>

                                                   2000         1999         1998
                                                ----------   ----------   ----------
<S>                                             <C>          <C>          <C>
        Previously written off receivable (a)   $  166,400   $  401,960   $   97,073
        Gain on settlement (b)                                  950,000
        Net operating loss sale (c)                215,278      317,482
        Interest                                       945
                                                ----------   ----------   ----------

                                                $  382,623   $1,669,442   $   97,073
                                                ==========   ==========   ==========
</TABLE>

                                      F-19

<PAGE>

                          HYMEDIX, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Continued)



13.     OTHER INCOME (CONTINUED)

        (a)   Amount relates to the recording of a receivable previously written
              off by the Company in a prior year (see Note 4). All amounts have
              been collected as of December 31, 1999 with the exception of
              $203,600 which is recorded as a note receivable from related party
              in the accompanying financial statements.

        (b)   Gain on settlement represents prior rent that has been forgiven by
              the Company's ex-landlord.

        (c)   Net operating loss ("NOL") sale represents the sale of a portion
              of the Company's New Jersey NOLs to a company as approved and
              permitted by the State of New Jersey.

                                      F-20

<PAGE>

ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K.

         (a)  EXHIBITS.

              EXHIBIT NO.                     DESCRIPTION

                 2.1         Amended and Restated Agreement of Merger and Plan
                             of Reorganization, dated as of January 24, 1994 by
                             and among Servtex International Inc., Kingston
                             Technologies, Inc., KTI Acquisition Corp. and
                             certain affiliates of Servtex International Inc.,
                             filed pursuant to Rule 14a-6 as Exhibit F to Proxy
                             Statement of the Registrant (then Servtex
                             International Inc.), dated February 12, 1994, and
                             incorporated by reference herein.

                 2.2         Agreement of Merger, dated as of February 23, 1994
                             by and between Servtex International Inc. and
                             HYMEDIX, Inc., filed pursuant to Rule 14a-6 as
                             Exhibit A to Proxy Statement of the Registrant
                             (then Servtex International Inc.), dated February
                             12, 1994, and incorporated by reference herein.

                 3.1         Certificate of Incorporation, filed pursuant to
                             Rule 14a-6 as Exhibit B to Proxy Statement of the
                             Registrant (then Servtex International Inc.), dated
                             February 12, 1994, and incorporated by reference
                             herein.

                 3.2         Certificate of Designation, Preference and Rights
                             of Series A Redeemable Preferred Stock, filed as
                             Exhibit (2) to Form 8-K, dated February 23, 1994,
                             of the Registrant and incorporated by reference
                             herein.

                 3.3         By-Laws of the Registrant, filed pursuant to Rule
                             14a-6 as Exhibit C to Proxy Statement of the
                             Registrant (then Servtex International Inc.), dated
                             February 12, 1994, and incorporated by reference
                             herein.

                 4.1*        Specimen Certificate of the Registrant's Common
                             Stock, $.001 par value.

                 10.1*       Form of the Underwriter's Warrant issued to First
                             Flushing Securities, Inc. as a broker's fee for
                             negotiating the merger of KTI Acquisition Corp., a
                             Delaware corporation and wholly-owned subsidiary of
                             the Registrant with and into HYMEDIX International.

                 10.2**      Option and License Agreement dated November 7, 1986
                             by and between HYMEDIX International and ORC, as
                             amended by Amendment Number 1 to Option and License
                             Agreement dated January 9, 1987.

                 10.3*       Promissory Note, dated January 9, 1987, made by
                             HYMEDIX International to the order of ORC, for
                             $500,000.

                                       23

<PAGE>

                 10.4*       Indenture of Lease dated July 7, 1987 by and
                             between Fresh Ponds Associates and HYMEDIX
                             International, as amended by First Amendment to
                             Lease, dated September 13, 1993, Second Amendment
                             to Lease, dated September 15, 1993, and Third
                             Amendment to Lease, dated January 15, 1994; and the
                             related Installment Promissory Note, dated October
                             1, 1993, made by HYMEDIX International to the order
                             of Fresh Ponds Associates for $404,300.90.

                 10.5*       Promissory Note, dated September 29, 1987, made by
                             HYMEDIX International to the order of ORC, for
                             $1,000,000.

                 10.6**      Agreement, dated December 22, 1988, by and between
                             Kingston Hydrogels Limited Partnership and LIPO
                             Chemicals, Inc., as amended by Amendment No. 1,
                             effective June 1, 1990 and as further amended by
                             Amendment Agreement, dated June 14, 1990.

                 10.7*       Loan and Security Agreement, dated October 30,
                             1989, by and between HYMEDIX International and
                             Pilkington Visioncare, Inc. ("PVI").

                 10.8*       Promissory Note in the amount of $1,000,000, dated
                             October 30, 1989, by HYMEDIX International, in
                             favor of PVI.

                 10.9*       Assignment of Patent, dated October 30, 1989 by
                             HYMEDIX International in favor of PVI.

                 10.10**     License and Supply Agreement, dated October 30,
                             1989, between HYMEDIX International and PVI, along
                             with Addendum thereto dated July 10, 1991.

                 10.11*      Contribution Agreement, dated August 7, 1990, by
                             and between Kingston Technologies Limited
                             Partnership ("KTLP") and HYMEDIX International.

                 10.12*      Royalty Assignment Agreement, effective August 8,
                             1990, by and between HYMEDIX International and
                             Research Corporation Technologies, Inc. ("RCT").

                 10.13*      Assignment of Patents, dated August 8, 1990, by
                             KTLP in favor of HYMEDIX International.

                 10.14*      Form of Amended and Restated Warrant to Purchase
                             Common Stock, dated February 23, 1994, delivered to
                             Cheung Hok Sau.

                 10.15*      Form of Amended and Restated Common Stock Purchase
                             Warrant, dated February 23, 1994, made by the
                             Registrant to the Trustees of Boston University.

                 10.16*      Right to Purchase Agreement, dated June 30, 1992,
                             between HYMEDIX International and Lipo Chemicals,
                             Inc.

                 10.17*      License Agreement, dated June 30, 1992, between
                             HYMEDIX International and Lipo Chemicals, Inc.

                 10.18*      Form of Amended and Restated Common Stock Purchase
                             Warrant, dated February 23, 1994, made by the
                             Registrant to Synreal Corporation N.V.

                 10.19*      Form of Amended and Restated Common Stock Purchase
                             Warrant, dated February 23, 1994, made by the
                             Registrant to Azreal Corporation N.V.

                 10.20*      Form of Amended and Restated Common Stock Purchase
                             Warrant, dated February 23, 1994, made by the
                             Registrant to Dr. Hsia Fu Chao.

                 10.21       Amended and Restated 1991 Incentive and
                             Non-Qualified Stock Option Plan, filed pursuant to
                             Rule 14a-6 as Exhibit E to Proxy Statement of the
                             Registrant (then Servtex International Inc.), dated
                             February 12, 1994, and incorporated by reference
                             herein.

                 10.22*      Employment Agreement, dated April 3, 1992, by and
                             between HYMEDIX International and Alan L. Hershey,
                             as amended by Agreement, dated January 4, 1993.

                                       24

<PAGE>

                 10.23*      Form of Amended and Restated Common Stock Purchase
                             Warrant, dated February 23, 1994, made by the
                             Registrant to First Taiwan Investment Holding Inc.

                 10.24*      Registration Rights Agreement, dated May 28, 1993,
                             by and between HYMEDIX International and the
                             Trustees of Boston University.

                 10.25*      Form of Amended and Restated Common Stock Purchase
                             Warrant, dated February 23, 1994, made by the
                             Registrant to the Trustees of Boston University.

                 10.26*      Form of Amended and Restated Common Stock Purchase
                             Warrant, dated February 23, 1994, made by the
                             Registrant to First Taiwan Investment and
                             Development Inc.

                 10.27*      Amended and Restated Registration Rights Agreement,
                             dated February 23, 1994, by and among RCT, First
                             Taiwan Investment Holding Inc. and First Taiwan
                             Venture Capital Inc.

                 10.28**     Marketing and Distribution Agreement, dated July
                             30, 1993, by and between HYMEDIX International and
                             Brady Medical Products, Co.

                 10.29*      Evaluation Agreement, dated December 1, 1993, by
                             and between HYMEDIX International and Alcon
                             Laboratories, Inc.

                 10.30*      Capital Contribution Agreement, dated February 23,
                             1994, by and between the Registrant and RCT.

                 10.31*      Demand Registration Rights Agreement, dated
                             February 23, 1994, by and between the Registrant
                             RCT.

                 10.32*      Option to Wall Street Group.

                 10.33*      Redeemable Common Stock Purchase Warrant, dated
                             February 23, 1994, made by the Registrant to First
                             Taiwan Investment Holding Inc.

                 10.34*      Form of Warrant issued to Selling Stockholders
                             (Domestic) in the private placements which closed
                             February, 1994.

                 10.35*      Form of Warrant issued to Selling Stockholders
                             (International) in the private placements which
                             closed February, 1994.

                 10.36**     Development Services and Licensing Agreement, dated
                             December 20, 1991, between HYMEDIX International
                             and W. L. Gore and Associates, Inc.

                 10.37*      Joint Venture Agreement, dated May 31, 1994, by and
                             among the Registrant, Beijing General
                             Pharmaceutical Corp., First Taiwan Investment
                             Banking Group and Technological Innovation
                             Corporation of China.

                 10.38***    Agreement, dated November 29, 1994, by and between
                             HYMEDIX International and Bausch & Lomb.

                 10.39***    Director Stock Option Plan, effective as of May 31,
                             1994.

                 10.40****   Development Services and Licensing Agreement, dated
                             December 20, 1991, between HYMEDIX International
                             and W. L. Gore and Associates, Inc.

                 10.41*****  Distribution, Kno-How Transfer, Licensing and
                             Manufacturing and Supply Agreement dated August 21,
                             1995, by and between HYMEDIX International, Inc.
                             and Europa Magnetics Corporation.

                 10.42#      Master Terms and Conditions For Purchase Orders
                             dated September 19, 1995, by and between Home
                             Shopping Club Inc. and HYMEDIX International, Inc.

                 10.43##     Convertible Bond Purchase Agreement, effective
                             February 27, 1996, by and among the Company,
                             HYMEDIX International, First Taiwan Investment and
                             Development, Inc., and the Purchasers (as defined
                             therein).

                                       25

<PAGE>
                 10.44##     Convertible Bond Purchase Agreement, effective
                             March 5, 1996, by and among the Company, HYMEDIX
                             International, and Su Chen Huang.


                 10.45###    Security Agreement dated as of August 8, 1996, by
                             and among the Company and the Bondholder
                             Representative (as defined therein).

                 21*         Subsidiaries of the Registrant.

                 27.1        Financial Data Schedule.

                 -----------------------

                 *       Previously filed as an Exhibit to the Registrant's Form
                         SB-2 Registration Statement (No. 33-78638) originally
                         filed on May 5, 1994 and incorporated herein by
                         reference.

                 **      Previously filed (and Confidential Treatment requested
                         pursuant to Rule 406 under the Securities Act) as an
                         Exhibit to the Registrant's Form SB-2 Registration
                         Statement (No. 33-78638) originally filed on May 5,
                         1994 and incorporated herein by reference.

                 ***     Previously filed as an Exhibit to the Registrant's Form
                         10-KSB originally filed April 17, 1995.

                 ****    Previously filed (and Confidential Treatment requested
                         pursuant to Rule 24-b2 under the Securities Exchange
                         Act of 1934) as an Exhibit to the Registrant's
                         Amendment No. 1 to Form 10-KSB/A originally filed April
                         30, 1995.

                 *****   Previously filed as an Exhibit to the Registrant's Form
                         10-QSB originally filed November 15, 1995.

                 #       Previously filed as an Exhibit to the Registrant's Form
                         10-QSB originally filed March 30, 1996.

                 ##      Previously filed as an Exhibit to the Registrant's Form
                         10-QSB originally filed May 15, 1996.

                 ###     Previously filed as an Exhibit to the Registrant's Form
                         10-QSB originally filed November 15, 1996.

         (b)  REPORTS ON FORM 8-K.  No reports on Form 8-K were filed during the
              fourth quarter of 2000.

                                       26