<PAGE>
                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-Q

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

For the quarterly period ended January 31, 2002

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

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

                         COMMISSION FILE NUMBER: 0-25169

                        GENEREX BIOTECHNOLOGY CORPORATION
             (Exact name of registrant as specified in its charter)

           Delaware                                  98-0178636
-------------------------------           --------------------------------
(State of other jurisdiction of           (IRS Employer Identification No.)
 incorporation or organization)

                          33 HARBOUR SQUARE, SUITE 202
                                TORONTO, ONTARIO
                                 CANADA M5J 2G2
                    (Address of principal executive offices)

                                  416/364-2551
              (Registrant's telephone number, including area code)

                                 Not applicable
--------------------------------------------------------------------------------
               (Former name, former address and former fiscal year
                          if changed since last report)

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

                      APPLICABLE ONLY TO CORPORATE ISSUERS

The number of outstanding shares of the registrant's common stock, par value
$.001, was 20,687,327 as of January 31, 2002.

<PAGE>

                        GENEREX BIOTECHNOLOGY CORPORATION
                                      INDEX

<TABLE>
<CAPTION>
<S>              <C>                                                                                        <C>
PART I:       FINANCIAL INFORMATION

Item 1.       Consolidated Financial Statements -- unaudited

              Consolidated Balance Sheets --
              January 31, 2002 and July 31, 2001 ....................................................        3

              Consolidated Statements of Operations --
              for the three-month periods ended January 31, 2002
              and 2001, the six-month periods ended January 31,
              2002 and 2001, and cumulative from November 2, 1995
              to January 31, 2002....................................................................        4

              Consolidated Statements of Cash Flows --
              For the six-month periods ended January 31, 2002
              and 2001, and cumulative from November 2, 1995
              to January 31, 2002....................................................................        5

              Notes to Consolidated Financial Statements.............................................        6

Item 2.       Management's Discussion and Analysis of Financial
              Condition and Results of Operations....................................................       10

Item 3.       Quantitative and Qualitative Disclosures
              About Market Risk......................................................................       16


PART II:      OTHER INFORMATION

Item 6.       Exhibits and Reports on Form 8-K.......................................................       17

Signatures...........................................................................................       18
</TABLE>

                                        2

<PAGE>

Item 1.  Consolidated financial statements

               GENEREX BIOTECHNOLOGY CORPORATION AND SUBSIDIARIES
                          (A DEVELOPMENT STAGE COMPANY)
                           CONSOLIDATED BALANCE SHEETS
                                   (UNAUDITED)
<TABLE>
<CAPTION>
                                                                                        January 31,       July 31,
                                                                                       -------------    ------------
                                                                                            2002            2001
                                                                                       --------------   ------------
<S>                                                                                           <C>             <C>
         ASSETS

Current Assets:
   Cash and cash equivalents                                                           $     949,367     $ 10,109,559
   Short-term investments                                                                 28,502,165       26,892,729
   Officers' loans receivable                                                              1,068,691        1,023,743
   Miscellaneous receivables                                                                  12,383           12,865
   Other current assets                                                                       77,825          112,620
                                                                                       -------------     ------------
         Total Current Assets                                                             30,610,431       38,151,516

Property and Equipment, Net                                                                3,999,834        3,727,761

Patents, Net                                                                                 561,981          434,307

Deposits                                                                                          --           20,000

Due From Related Parties                                                                     319,839          332,289
                                                                                       -------------     ------------

         TOTAL ASSETS                                                                  $  35,492,085     $ 42,665,873
                                                                                       =============     ============

         LIABILITIES AND STOCKHOLDERS' EQUITY

Current Liabilities:
   Accounts payable and accrued expenses                                               $   1,675,386     $  2,650,773
   Current maturities of long-term debt                                                        9,663            9,634
                                                                                       -------------     ------------
         Total Current Liabilities                                                         1,685,049        2,660,407

Long-Term Debt, Less Current Maturities                                                      652,533          683,026

Commitments and Contingencies

Stockholders' Equity:
   Series A, preferred stock, $.001 par value; (liquidation preference
     $12,735,900) authorized 1,000,000 shares, issued and outstanding 1,060 and
     1,000 shares at January 31, 2002 and at July 31, 2001, respectively                           1                1
   Special Voting Rights Preferred stock, $.001 par value;
     authorized, issued and outstanding 1,000 shares at
     January 31, 2002 and at July 31, 2001                                                         1                1
   Common stock, $.001 par value; authorized 50,000,000 shares, issued
     20,697,326 and 20,681,526 shares at January 31, 2002 and July 31, 2001,
     respectively and outstanding 20,687,326 and 20,681,526 shares at
     January 31, 2002 and July 31, 2001, respectively                                         20,697           20,681
   Treasury stock, at cost; 10,000 shares of common stock                                    (39,150)              --
   Additional paid-in capital                                                             89,621,415       88,776,859
   Notes receivable - common stock                                                          (325,520)        (314,300)
   Deficit accumulated during the development stage                                      (55,776,773)     (48,913,935)
   Accumulated other comprehensive loss                                                     (346,168)        (246,867)
                                                                                       -------------     ------------
         Total Stockholders' Equity                                                       33,154,503       39,322,440
                                                                                       -------------     ------------

         TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                                    $  35,492,085     $ 42,665,873
                                                                                       =============     ============
</TABLE>

                 The Notes to Consolidated Financial Statements
                     are an integral part of this statement.

                                       3
<PAGE>


                        GENEREX BIOTECHNOLOGY CORPORATION
                          (A DEVELOPMENT STAGE COMPANY)
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (UNAUDITED)
<TABLE>
<CAPTION>
                                                                                                            Cumulative
                                                                                                               From
                                                                                                            November 2,
                                                   For the Three Months Ended    For the Six Months Ended   1995 (Date of
                                                         January 31,                 January 31,            Inception) to
                                                  ------------------------     ------------------------      January 31,
                                                    2002          2001            2002          2001            2002
                                                  --------      ----------     ----------    -----------   -------------
                                                                (Restated)                   (Restated)
<S>                                                  <C>            <C>            <C>            <C>             <C>
Contract Research Revenues                       $       --    $        --    $        --    $ 1,000,000    $ 1,000,000

Operating Expenses:
   Research and development                       1,814,408     15,847,930      2,490,747     16,867,909     28,586,643
   Research and development - related party              --             --             --             --        220,218
   General and administrative                     1,967,117      2,570,262      4,195,342      3,894,815     31,946,811
   General and administrative - related party            --             --             --             --        314,328
                                                 ----------    -----------    -----------    -----------    -----------
       Total Operating Expenses                   3,781,525     18,418,192      6,686,089     20,762,724     61,068,000
                                                 ----------    -----------    -----------    -----------    -----------

Operating Loss                                   (3,781,525)   (18,418,192)    (6,686,089)   (19,762,724)   (60,068,000)

Other Income (Expense):
   Miscellaneous income                               3,914         10,658          7,911         10,658         26,481
   Interest income                                  232,933        486,536        566,467        706,481      2,312,312
   Interest expense                                 (15,885)       (14,307)       (32,087)       (33,927)      (313,526)
                                                 ----------    -----------    -----------    -----------    -----------

Net Loss Before the Undernoted                   (3,560,563)   (17,935,305)    (6,143,798)   (19,079,512)   (58,042,733)

Minority Interest Share of Loss                       1,860      2,985,000          1,860      2,985,000      2,986,860
                                                 ----------    -----------    -----------    -----------    -----------

Net Loss                                         (3,558,703)   (14,950,305)    (6,141,938)   (16,094,512)   (55,055,873)

Preferred Stock Dividend                            720,900             --        720,900             --        720,900
                                                 ----------    -----------    -----------    -----------    -----------

Net Loss Available to Common Stockholders        (4,279,603)  $(14,950,305)  $ (6,862,838)  $(16,094,512)  $(55,776,773)
                                                 ==========   ============   ============   ============   ============

Basic and Diluted Net Loss Per Common
  Share                                          $     (.21)  $       (.79)  $       (.33)  $       (.89)
                                                 ==========   ============   ============   ============

Weighted Average Number of Shares of
  Common Stock Outstanding                       20,679,730     18,905,307     20,681,670     18,040,898
                                                 ==========   ============   ============   ============
</TABLE>

                 The Notes to Consolidated Financial Statements
                     are an integral part of this statement.

                                       4
<PAGE>
                        GENEREX BIOTECHNOLOGY CORPORATION
                          (A DEVELOPMENT STAGE COMPANY)
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (UNAUDITED)
<TABLE>
<CAPTION>
                                                                           For the Six Months Ended               Cumulative From
                                                                                  January 31,                     November 2, 1995
                                                                        ---------------------------------       (Date of Inception)
                                                                             2002                 2001          to January 31, 2002
                                                                        -------------        ------------       -------------------
                                                                                               (Restated)
<S>                                                                           <C>                   <C>                   <C>
Cash Flows From Operating Activities:
Net loss                                                                $ (6,141,938)         $(16,094,512)          $(55,055,873)
   Adjustments to reconcile net loss to
     net cash used in operating activities:
       Depreciation and amortization                                         198,379                41,411                639,656
       Minority interest share of loss                                        (1,860)           (2,985,000)            (2,986,860)
       Reduction of notes receivable - common
         stock in exchange for services rendered                                  --                    --                423,882
       Write-off of deferred offering costs                                       --                    --              3,406,196
       Common stock issued for services rendered                              71,172               532,904              2,141,164
       Stock options and warrants issued for
         services rendered                                                    25,000               745,000              4,613,060
       Preferred stock issued for services rendered                               --                    --                    100
       Founders shares transferred for services
         Rendered                                                                 --                    --                353,506
       Changes in operating assets and liabilities:
         Miscellaneous receivables                                                --                15,663                 30,620
         Other current assets                                                 35,158               (39,451)               (82,448)
         Accounts payable and accrued liabilities                           (960,240)             (140,068)             2,531,881
         Other, net                                                               --                    --                110,317
                                                                         -----------          ------------           ------------
           Net Cash Used in Operating Activities                          (6,774,329)          (17,924,053)           (43,874,799)

Cash Flows From Investing Activities:
   Purchase of property and equipment                                       (559,285)             (943,484)            (2,856,256)
   Purchases of intangibles                                                 (152,433)             (100,520)              (619,366)
   Change in restricted cash                                                      --                    --                 (5,595)
   Purchase of short-term investments                                     (1,609,436)          (25,387,624)           (28,502,165)
   Increase in officers' loans receivable                                    (44,948)                   --             (1,068,691)
   Change in deposits                                                         20,000                27,884                 49,515
   Change in notes receivable - common stock                                 (11,220)               (1,831)               (25,520)
   Change in due from related parties                                             --                    --             (2,255,197)
   Other, net                                                                     --                    --                 89,683
                                                                         -----------          ------------           ------------
           Net Cash Used in Investing Activities                          (2,357,322)          (26,405,575)           (35,193,592)

Cash Flows From Financing Activities:
   Proceeds from issuance of long-term debt                                       --                    --                993,149
   Repayment of long-term debt                                                (4,554)               (6,479)              (970,538)
   Change in due to related parties                                               --                    --                154,541
   Proceeds from exercise of warrants                                             --               494,250              2,256,482
   Proceeds from exercise of stock options                                    27,500                    --                772,500
   Proceeds from issuance of common stock, net                                    --            28,228,907             61,999,294
   Proceeds from issuance of preferred stock                                      --            12,015,000             12,015,000
   Proceeds from minority interest investment                                  1,860             2,985,000              2,986,860
   Purchase and retirement of common stock                                        --                    --               (119,066)
   Purchase of treasury stock                                                (39,150)                   --                (39,150)
                                                                         -----------          ------------           ------------
           Net Cash (Used In) Provided By Financing
            Activities                                                       (14,344)           43,716,678             80,049,072

Effect of Exchange Rates on Cash and Cash Equivalents                        (14,197)              (26,694)               (31,314)
                                                                         -----------          ------------           ------------
Net Increase (Decrease) in Cash and Cash Equivalents                      (9,160,192)             (639,644)               949,367
Cash and Cash Equivalents, Beginning of Period                            10,109,559             3,204,905                     --
                                                                         -----------          ------------           ------------
Cash and Cash Equivalents, End of Period                                 $   949,367          $  2,565,261           $    949,367
                                                                         ===========          ============           ============
</TABLE>
                 The Notes to Consolidated Financial Statements
                     are an integral part of this statement.

                                       5
<PAGE>


               GENEREX BIOTECHNOLOGY CORPORATION AND SUBSIDIARIES
                          (A DEVELOPMENT STAGE COMPANY)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)



       1.  Basis of Presentation
           The accompanying unaudited interim consolidated financial statements
           have been prepared pursuant to the rules and regulations for
           reporting Form 10-Q. Accordingly, certain information and disclosures
           required by generally accepted accounting principles for complete
           financial statements are not included herein. The interim statements
           should be read in conjunction with the financial statements and notes
           thereto included in the Company's latest Annual Report on Form 10-K.

           Interim statements are subject to possible adjustments in connection
           with the annual audit of the Company's accounts for the fiscal year
           2002; in the Company's opinion, all adjustments necessary for a fair
           presentation of these interim statements have been included and are
           of a normal and recurring nature.

       2.  Comprehensive Income/(Loss)
           The Company has adopted the provisions of Statement No. 130,
           Reporting Comprehensive Income, which modifies the financial
           statement presentation of comprehensive income and its components.
           Adoption of this statement had no effect on the Company's financial
           position or operating results.

           Comprehensive loss, which includes net loss and the change in the
           foreign currency translation account during the period, for the six
           months ended January 31, 2002 and 2001, was $6,241,239 and
           $16,143,061, respectively.

       3.  Accounts Payable and Accrued Expenses
           Accounts payable and accrued expenses consist of the following:

                                                 January 31,       July 31,
                                                     2002            2001
                                               -------------   -------------

           Accounts Payable                    $    521,040    $    896,061
           Litigation Accruals                      184,471         191,653
           Clinical                                    --           147,699
           Accrued Legal Fees                          --           420,360
           Financial Services                       418,000         995,000
           Executive Compensation                   551,875              --
                                               ------------    ------------
                 Total                         $  1,675,386    $  2,650,773
                                               ============    ============

                                       6
<PAGE>

               GENEREX BIOTECHNOLOGY CORPORATION AND SUBSIDIARIES
                          (A DEVELOPMENT STAGE COMPANY)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)


       4.  Pending Litigation
           On October 2, 1998, Sands Brothers & Co. Ltd., a New York City-based
           investment banking and brokerage firm, initiated an arbitration
           against the Company under New York Stock Exchange rules. Sands
           alleged that it had the right to receive, for nominal consideration,
           approximately 1.5 million shares of the Company's common stock. Sands
           based its claim upon an October 1997 letter agreement that was
           purported by Sands to confirm an agreement appointing Sands as the
           exclusive financial advisor to Generex Pharmaceuticals, Inc., a
           subsidiary of the Company that was acquired in late 1997. In
           exchange, the letter agreement purported to grant Sands the right to
           acquire 17% of Generex Pharmaceuticals common stock for nominal
           consideration. Sands claimed that its right to receive shares of
           Generex Pharmaceuticals common stock applies to the Company's common
           stock since outstanding shares of Generex Pharmaceuticals common
           stock were converted into shares of the Company's common stock in the
           acquisition. Sands' claims also included additional shares allegedly
           due as a fee related to that acquisition, and $144,000 in monthly
           fees allegedly due under the terms of the purported agreement.

           Pursuant to an arbitration award dated September 22, 1999, the
           arbitration panel that heard this case awarded Sands $14,070 and
           issued a declaratory judgment requiring the Company to issue to Sands
           a warrant to purchase 1,530,020 shares of the Company's common stock
           pursuant to and in accordance with the terms of the purported October
           1997 letter agreement. On October 13, 1999, Sands commenced a special
           proceeding to confirm the arbitration award in the Supreme Court of
           the State of New York, County of New York (the "New York Supreme
           Court"). On November 10, 1999, the Company moved to vacate the
           arbitration award. On March 20, 2000, the New York Supreme Court
           granted Sands' petition to confirm the award and denied the Company's
           motion to vacate the award. The Company appealed and on January 23,
           2001, the New York State Appellate Division, First Department (the
           "Appellate Division"), modified the judgment of the New York Supreme
           Court that had confirmed the arbitration award against the Company.
           The Appellate Division affirmed the portion of the New York Supreme
           Court judgment that had confirmed the granting of monetary relief of
           $14,070 to Sands but modified the judgment to vacate the portion of
           the arbitration award directing the issuance to Sands of a warrant to
           purchase 1,530,020 shares of the Company's common stock. The
           Appellate Division held that the portion of the award directing the
           Company to issue warrants to Sands is too indefinite to be
           enforceable and remanded the matter to the arbitration panel for a
           final and definite award with respect to such relief or its
           equivalent (including possibly an award of monetary damages). The
           arbitration panel commenced hearings on the matters remanded by the
           Appellate Division in June 2001. On November 7, 2001, the arbitration
           panel issued an award again requiring the Company to issue to Sands a
           warrant to purchase 1,530,020 shares of the Company's common stock
           purportedly pursuant to and in accordance with the terms of the
           October 1997 letter agreement. Thereafter, Sands submitted a motion
           to the New York Supreme Court to modify and confirm the arbitration
           panel's award while the Company filed a motion with the court to
           vacate the arbitration award. On February 25, 2002, the New York
           Supreme Court vacated the arbitration panel's award. At the present
           time, the Company is not able to predict the ultimate outcome of this
           legal proceeding or to estimate a range of possible loss from this
           legal proceeding. Therefore, no provision has been recorded in the
           accompanying financial statements.

                                       7
<PAGE>
               GENEREX BIOTECHNOLOGY CORPORATION AND SUBSIDIARIES
                          (A DEVELOPMENT STAGE COMPANY)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)


       4.  Pending Litigation (continued)

           In February 2001, a former business associate of the Vice President
           of Research and Development (VP), and an entity called Centrum
           Technologies Inc. commenced an action in the Ontario Superior Court
           of Justice against the Company and the VP seeking, among other
           things, damages for alleged breaches of contract and tortious acts
           related to a business relationship between this former associate and
           the VP that ceased in July 1996. The plaintiffs' statement of claim
           also seeks to enjoin the use, if any, by the Company of three patents
           allegedly owned by the company called Centrum Technologies Inc. On
           July 20, 2001, the Company filed a preliminary motion to dismiss the
           action of Centrum Technologies Inc. as a nonexistent entity or,
           alternatively, to stay such action on the grounds of want of
           authority of such entity to commence the action and, in the further
           alternative, to dismiss such action for failure to produce documents
           referred to in the statement of claim. On December 6, 2001, the
           Company's preliminary motion to dismiss the action of Centrum
           Technologies Inc. was heard and granted. The Company intends to
           continue its vigorous defense of this legal proceeding. The Company
           is not able to predict the ultimate outcome of this legal proceeding
           at the present time or to estimate an amount or range of potential
           loss, if any, from this legal proceeding.

           In February 1997, a former employee of Generex Pharmaceuticals, Inc.,
           commenced an action in the Ontario Superior Court of Justice for
           wrongful dismissal. The Ontario Superior Court of Justice rendered
           judgment in favor of the plaintiff for approximately $127,000 plus
           interest in November 1999 and further awarded costs to the plaintiff
           in March 2000. An appeal of the judgment was filed with the Court of
           Appeal for Ontario in April 2000. The Company intends to continue its
           vigorous defense of this action. The Company does not believe that
           the ultimate resolution of this legal proceeding will have a material
           effect on the consolidated financial position of the Company. The
           Company has established a reserve for potential loss contingencies
           related to the resolution of this legal proceeding, the amount of
           which of is not material to the consolidated financial position of
           the Company.

           In March 1999, a former consultant to the Company commenced an action
           in the Ontario Superior Court of Justice against the Company seeking
           approximately $94,000 and 1,465 shares of the Company's Common Stock
           for alleged breach of contract damages and additional amounts in
           punitive damages. In April 1999, the Company filed a counterclaim for
           monies the Company believes are due to the Company from this former
           consultant. The parties have completed discovery and the trial date
           of this action is scheduled to commence the week of April 8, 2002.
           The Company intends to continue its vigorous defense of this action.
           The Company does not believe that the ultimate resolution of this
           legal proceeding will have a material effect on the consolidated
           financial position of the Company. The Company has established a
           reserve for potential loss contingencies related to the resolution of
           this legal proceeding, the amount of which of is not material to the
           consolidated financial position of the Company.

           The Company is involved in certain other legal proceedings in
           addition to those specifically described herein. Subject to the
           uncertainty inherent in all litigation, the Company does not believe
           at the present time that the resolution of any of these legal
           proceedings is likely to have a material adverse effect on the
           Company's consolidated financial position.


                                       8

<PAGE>
               GENEREX BIOTECHNOLOGY CORPORATION AND SUBSIDIARIES
                          (A DEVELOPMENT STAGE COMPANY)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)


       5.  Supplemental Disclosure of Cash Flow Information
<TABLE>
<CAPTION>
                                                                                      For the Six Months Ended
                                                                                              January 31,
                                                                                -------------------------------------
                                                                                      2002                 2001
                                                                                ----------------     ----------------
                       <S>                                                              <C>                  <C>

           Cash paid during the period for:
              Interest                                                              $  32,087           $    33,927
              Income taxes                                                          $      --           $        --

           Disclosure of non-cash investing and financing activities:

           Issuance of warrants as consideration for an equity financing
              agreement were capitalized as deferred offering costs                 $      --           $ 3,406,196

           Issuance of Series A Preferred Stock as preferred stock
              dividend                                                              $ 720,900           $        --

</TABLE>
       6.  Transactions With Related Parties
           The Company's change in "Due from Related Parties" for the six months
           ended January 31, 2002 represents only the effects of changes in
           quarter end exchange rates versus those in effect at July 31, 2001.

       7.  Restatement of Prior Quarter
           To account for the effect of restatements disclosed in the Company's
           Form 10-K for the year ended July 31 2001, the Company's financial
           information for the three and six month periods ended January 31,
           2001 have been restated to recognize additional compensation expense
           related to stock options issued to a consultant.

           The following schedule sets forth the quarterly financial information
           for the three-month period ended January 31, 2001 as previously
           reported and as restated for the effect of the above mentioned
           adjustment:

<TABLE>
<CAPTION>
                                                                                    Previously
                                                                                     Reported             Restated
                                                                                ----------------     ----------------
            <S>                                                                    <C>                  <C>
           Contract Research Revenue                                                $         --                  --
           Operating Loss                                                           $(17,673,192)       $(18,418,192)
           Net Loss                                                                 $(14,205,305)       $(14,950,305)
           Net Loss Per Share                                                       $      (0.75)       $      (0.79)
</TABLE>

       8.  Preferred Stock Dividend
           On January 15, 2002, the Company paid a 6 percent stock dividend on
           the Company's Series A Preferred Stock. The dividend was paid in
           shares of Series A Preferred stock, and resulted in a charge to
           accumulated deficit of $720,900, which was based upon the original
           issue price of the preferred shares.

       9.  Subsequent Events
           In February 2002, the Company purchased 31,400 shares of common stock
           to be held in treasury for $147,346.

                                       9
<PAGE>




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

Forward Looking Statements

         We have made statements in the Management's Discussion and Analysis of
Financial Condition and Results of Operations, in the Notes to Consolidated
Financial Statements and elsewhere in this Report that may be forward-looking
statements within the meaning of the Private Securities Litigation Reform Act of
1995. These statements can be identified by introductory words such as
"expects", "plans", "intends", "believes", "will", "estimates", "forecasts",
"projects" or words of similar meaning, and by the fact that they do not relate
strictly to historical or current facts. Our forward-looking statements address,
among other things:

         o  the status of activities under our development and license agreement
            with Eli Lilly and Company;

         o  the status of activities under our joint venture with Elan;

         o  our other clinical and product development programs and other
            aspects of our business plans;

         o  the development of additional products using our buccal delivery
            technology;

         o  our financing goals, plans and future needs; and

         o  our expectations of when regulatory approvals will be received or
            other actions will be taken by parties other than us.

         Any or all of our forward-looking statements may turn out to be wrong.
They may be affected by inaccurate assumptions that we might make or by known or
unknown risks and uncertainties. Actual outcomes and results may differ
materially from what is expressed or implied in our forward-looking statements.
Among the factors that could affect future results are:

         o  the inherent uncertainties of product development based on a new and
            as yet not fully proven drug delivery technology;

         o  the risks and uncertainties regarding the actual effect on humans of
            seemingly safe and efficacious formulations when tested clinically;

         o  the inherent uncertainties associated with identification and
            initial development of product candidates;

         o  the inherent uncertainties associated with clinical trials of
            product candidates;

                                       10
<PAGE>

         o  the inherent uncertainties associated with the process of obtaining
            regulatory approval to market product candidates; and

         o  adverse developments in our collaboration with Lilly regarding
            buccal insulin, which is currently our only product candidate that
            has moved beyond preliminary research and development.

         Additional factors that could affect future results are set forth in
our Annual Report on Form 10-K for the fiscal year ended July 31, 2001. We
caution investors that the forward-looking statements contained in this Report
must be interpreted and understood in light of conditions and circumstances that
exist as of the date of this Report. We expressly disclaim any obligation or
undertaking to update or revise forward-looking statements made in this Report
to reflect any changes in management's expectations resulting from future events
or changes in the conditions or circumstances upon which such expectations are
based.

General

         Corporate History. We were incorporated in Delaware in September 1997
for the purpose of acquiring Generex Pharmaceuticals, Inc., a Canadian
corporation formed in November 1995 to engage in pharmaceutical and
biotechnological research and other activities. Our acquisition of Generex
Pharmaceuticals was completed in October 1997 in a transaction in which the
holders of all outstanding shares of Generex Pharmaceuticals exchanged their
shares for shares of our common stock.

         In January 1998, we participated in a "reverse acquisition" with Green
Mt. P. S., Inc., a previously inactive Idaho corporation formed in 1983. As a
result of this transaction, our shareholders (the former shareholders of Generex
Pharmaceuticals) acquired a majority (approximately 90%) of the outstanding
capital stock of Green Mt., we became a wholly-owned subsidiary of Green Mt.,
Green Mt. changed its corporate name to Generex Biotechnology Corporation
("Generex Idaho"), and we changed our corporate name to GBC Delaware, Inc.
Because the reverse acquisition resulted in our shareholders becoming the
majority holders of Generex Idaho, we were treated as the acquiring corporation
in the transaction for accounting purposes. Thus, our historical financial
statements, which essentially represented the historical financial statements of
Generex Pharmaceuticals, were deemed to be the historical financial statements
of Generex Idaho.

         In April 1999, we completed a reorganization in which we merged with
Generex Idaho. In this transaction, all outstanding shares of Generex Idaho were
converted into our shares, Generex Idaho ceased to exist as a separate entity,
and we changed our corporate name back to "Generex Biotechnology Corporation".
This reorganization did not result in any material change in our historical
financial statements or current financial reporting.

         Business History. We are engaged in the development of proprietary drug
delivery technology. Our principal business focus has been to develop a
technology for buccal delivery (absorption through the inner cheek walls) of
large molecule drugs, i.e., drugs composed of molecules with molecular weights
above a specified level. Large molecule drugs historically have been
administered only by injection because their size inhibits or precludes
absorption if administered by oral, transdermal, transnasal or other means.

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<PAGE>

         Our first product is an insulin formulation that is administered as a
fine spray into the oral cavity using a hand-held aerosol spray applicator.
Between January 1999 and September 2000, we conducted clinical trials on this
product in the United States, Canada and Europe. In September 2000, we entered
into an agreement to develop this product with Eli Lilly and Company. Under this
agreement (the "Lilly Agreement"), Lilly is responsible for conducting clinical
trials of the product, securing regulatory approvals and marketing on a
worldwide basis. We received $1,000,000 in connection with our entry into the
agreement and will receive certain other initial fees and milestone payments
subject to the attainment of certain product development milestones, as well as
royalty payments based on product sales should any products be approved for
commercial sale. Lilly also has the option to develop certain additional
products using our buccal delivery technology depending on the success of the
initial product.

         In January 2001, we established a joint venture with Elan International
Services, Ltd. ("EIS"), a wholly-owned subsidiary of Elan Corporation, plc (EIS
and Elan Corporation, plc being collectively referred to as "Elan"), to pursue
the application of certain of our and Elan's drug delivery technologies,
including our platform technology for the buccal delivery of pharmaceutical
products, for the treatment of prostate cancer, endometriosis and/or the
suppression of testosterone and estrogen. In January 2002, we and Elan agreed to
expand the joint venture to encompass the buccal delivery of morphine for the
treatment of pain and agreed to pursue buccal morphine as the initial
pharmaceutical product for development under the joint venture.

         The joint venture is being conducted through Generex (Bermuda), Ltd., a
Bermuda limited liability company. In connection with the formation of the joint
venture in January 2001, EIS purchased 1,000 shares of a new series of our
preferred stock, designated as Series A Preferred Stock, for $12,015,000. We
applied the proceeds from the sale of the Series A Preferred Stock to subscribe
for an 80.1% equity ownership interest in Generex (Bermuda), Ltd. EIS paid in
capital of $2,985,000 to subscribe for a 19.9% equity ownership interest in the
joint venture entity. While we presently own 80.1% of the joint venture entity,
EIS has the right, subject to certain conditions, to increase its ownership up
to 50% by exchanging the Series A Preferred Stock for 30.1% of our equity
ownership of the joint venture entity.

         Generex (Bermuda), Ltd. has been granted non-exclusive licenses to
utilize our buccal delivery technology and certain Elan drug delivery
technologies. In January 2001, using the funds from its initial capitalization,
Generex (Bermuda), Ltd. paid a non-refundable license fee of $15,000,000 to Elan
in consideration for being granted the rights to utilize the Elan drug delivery
technologies.

         Our buccal delivery technology is a platform technology that we believe
has application to a significant number of large molecule drugs in addition to
insulin and morphine. In the future, we expect to undertake development of
additional products based on this technology that are not covered by the Lilly
Agreement or the joint venture with Elan.

                                       12
<PAGE>

Results of Operations

         We have been in the development stage since inception and have not
generated any operating revenues to date, other than $1,000,000 in revenues
received in connection with the signing of the Lilly Agreement.

         To account for the effect of restatements disclosed in the Company's
Form 10-K for the year ended July 31, 2001, the Company's financial information
for the three and six month periods ended January 31, 2001 has been restated to
recognize additional compensation expense related to stock options issued to a
consultant.

         Our net loss for the quarter ended January 31, 2002, was $3,558,703,
versus $14,950,305 for the corresponding quarter of the prior fiscal year. The
net loss in the prior fiscal year included the effect of the accounting
treatment for our joint venture with Elan, which resulted in a $15,000,000
research and development expense for the license fee paid by Generex (Bermuda),
Ltd. to Elan for technology rights that was partially offset by $2,985,000 of
minority interest (reflecting Elan's 19.9% ownership of the joint venture
entity). Excluding the effect of the joint venture with Elan, our net loss
quarter to quarter increased by approximately $0.6 million, reflecting increased
research and development expenses (primarily due to ongoing research and
development activities under our collaboration with Lilly as well as proof of
concept activities related to buccal morphine) and decreased interest income
(due to lower short term interest rates), partially offset by decreased general
and administrative expenses (primarily due to decreased compensation expenses
associated with consultants).

         Our net loss for the six months ended January 31, 2002, was $6,141,938,
versus $16,094,512 for the corresponding period of the prior fiscal year. The
prior fiscal year period included the net negative effect of the accounting
treatment for our joint venture with Elan, which was partially offset by the
$1,000,000 Lilly Agreement signing fee received during the prior fiscal year
period. Excluding these items, our net loss for the current period versus the
prior fiscal year period increased by approximately $1.07 million, primarily
reflecting significantly increased operating expenses. The increase in operating
expenses was primarily attributable to increased research and development
expenses (reflecting the increased level of research and development activities,
particularly in the second quarter of fiscal 2002, partially offset by the
absence in the current period of expenses related to the construction and set up
of our pilot manufacturing facility) and increased general and administrative
expenses (reflecting the executive bonuses paid and higher legal expenses
incurred during the first quarter of fiscal 2002).

         During January 2002, we issued 60 additional shares of Series A
Preferred Stock to an affiliate of Elan in payment of the 6% annual stock
dividend that was required to be paid on the 1,000 outstanding shares of such
stock (which were issued in January 2001 as part of our joint venture with
Elan). This resulted in a non-cash charge to accumulated deficit of $720,900
that increased the "net loss available to common stockholders" for the three
months and six months ended January 31, 2002 by a corresponding amount.

Financial Condition, Liquidity and Resources

         To date we have financed our development stage activities primarily
through private placements of common stock and contract research and milestone
payments. At January 31, 2002, we had cash and short term investments (primarily
notes of United States corporations) of approximately $29.45 million. At July
31, 2001, our cash and short term investments were approximately $37 million.
The decrease was attributable to the use of cash for ongoing operations.


                                       13
<PAGE>


         We believe that our current cash position is sufficient to meet all of
our working capital needs for at least the next 12 months based on the pace of
our current development activities (including our activities under the Lilly
Agreement and under our joint venture with Elan). Beyond that, we may require
additional funds to support our working capital requirements or for other
purposes and may seek to raise funds through private or public equity financing
or from other sources. If we were unable to raise additional capital as needed,
we could be required to "scale back" or otherwise revise our business plan. Any
significant scale back of operations or modification of our business plan due to
a lack of funding could be expected to materially and adversely affect our
prospects.

         In the past we have funded most of our development and other costs with
equity financing. While we have been able to raise equity capital as required,
unforeseen problems with our clinical program or materially negative
developments in general economic conditions could interfere with our ability to
raise additional equity capital as needed, or materially adversely affect the
terms upon which such capital is available.

Transactions with Affiliates

         On May 3, 2001, the Company's three senior officers, who are also
shareholders of the Company, were advanced $334,300 each, in exchange for
promissory notes. These notes bear interest at 8.5 percent per annum and are
payable in full on May 1, 2002. These notes are guaranteed by a related company
owned by these officers and secured by a pledge of 2,500,000 shares of the
Company's common stock currently owned by this related company. As of January
31, 2002, the balance outstanding on these notes, including accrued interest,
was $1,068,691.

         Prior to January 1, 1999, a portion of our general and administrative
expenses resulted from transactions with affiliated persons, and a number of
capital transactions also involved affiliated persons. Although these
transactions were not the result of "arms-length" negotiations, we do not
believe that this fact had a material impact on our results of operations or
financial position. Prior to December 31, 1998, we classified certain payments
to executive officers for compensation and expense reimbursements as "Research
and development - related party" because the executive officers received such
payments through personal services corporations rather than directly. After
December 31, 1998, these payments have been and will continue to be accounted
for as though the payments were made directly to the officers, and not as a
related party transaction. We do not foresee a need for, and therefore do not
anticipate, any related party transactions in the current fiscal year.

New Accounting Pronouncements

         In June 1998, 1999, and 2000, the FASB issued SFAS No. 133, Accounting
for Derivative Instruments and Hedging Activities, SFAS No. 137, Accounting for
Derivative Instruments and Hedging Activities - Deferral of the Effective Date
of FASB Statement No. 133, and SFAS No. 138, Accounting for Certain Derivative
Instruments and Certain Hedging Activities, respectively. These statements
require companies to record derivatives on the balance sheet as assets or
liabilities, measured at fair value. Gains or losses resulting from changes in
the values of those derivatives would be accounted for depending on the use of
the derivative and whether it qualifies for hedge accounting. The adoption on
August 1, 2000 of these statements did not have a significant impact on our
financial position or results of operations.

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<PAGE>

         In December 1999, the SEC issued Staff Accounting Bulletin No. 101 (SAB
101), Revenue Recognition in Financial Statements. SAB 101 provides guidance on
the recognition, presentation, and disclosure of revenues in financial
statements of all public registrants. In October 2000, the SEC issued a
Frequently Asked Questions document related to SAB 101 that provides
interpretive guidance. We adopted SAB 101 in fiscal year 2001, and the adoption
of SAB 101 did not have a significant impact on our financial position or
results of operations.

         In June 2001, the FASB issued SFAS No. 141, Business Combinations. SFAS
No. 141 addresses the initial recognition and measurement of goodwill and other
intangible assets acquired in a business combination. SFAS No. 141 is applicable
to business combinations beginning July 1, 2001. The adoption of this statement
did not have a significant impact on our financial position or results of
operations.

         In June 2001, the FASB issued SFAS No. 142, Goodwill and Other
Intangible Assets. SFAS No. 142 addresses the recognition and measurement of
goodwill and other intangible assets subsequent to their acquisition. SFAS No.
142 also addresses the initial recognition and measurement of intangible assets
acquired outside of a business combination whether acquired individually or with
a group of other assets. Goodwill and intangible assets previously recorded, in
our financial statements, will be affected by the provisions of SFAS No. 142.
This statement provides that intangible assets with finite useful lives be
amortized and that intangible assets with indefinite lives and goodwill will not
be amortized, but will rather be tested at least annually for impairment. SFAS
No. 142 will be effective for our fiscal year 2002, however management is
assessing the impact that SFAS No. 142 will have on our financial position and
results of operations.

         In July 2001, the FASB issued SFAS No. 144, "Impairment or Disposal of
Long-Lived Assets," which is effective for fiscal years beginning after December
15, 2001. The provisions of this statement provide a single accounting model for
impairment of long-lived assets. The Company is currently assessing the impact
of this new standard.

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Item 3.      Quantitative and Qualitative Disclosures About Market Risk

         We are not presently subject to any material market risk exposures. We
are exposed to market risk associated with interest rate changes and changes in
the exchange rate between US and Canadian currencies.

         We have neither issued nor own any long term debt instruments, or any
other financial instruments as to which we would be subject to material risks.
At the present time, we maintain our cash in short term government or government
guaranteed instruments, short term commercial paper, interest bearing bank
deposits or demand bank deposits which do not earn interest. A substantial
majority of these instruments and deposits are denominated in US dollars, with
the exception of funds denominated in Canadian dollars on deposit in Canadian
banks to meet short term operating needs in Canada. We do not presently employ
any hedging or similar strategy intended to mitigate against losses that could
be incurred as a result of fluctuations in the exchange rates between US and
Canadian currencies.




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                           PART II. OTHER INFORMATION

Item 6.           Exhibits and Reports on Form 8-K

(a)      Reports on Form 8-K.

         The following Reports on Form 8-K were filed in the quarter ended
January 31, 2002:

         o  On November 8, 2001, the Company filed a Current Report on Form 8-K
            to update our description of the Sands legal proceeding (Item 5 of
            Form 8-K - "Other Events").

         o  On January 7, 2002, the Company filed a Current Report on Form 8-K
            to provide certain disclosures related to the Company's annual
            meeting of stockholders (Item 5 of Form 8-K - "Other Events").

         o  On January 23, 2002, the Company filed a Current Report on Form 8-K
            to provide certain disclosures about a successful proof of concept
            study of buccal morphine and about the expansion of the Company's
            joint venture with Elan to include buccal morphine and the
            designation of buccal morphine as the initial product for
            development under the joint venture (Item 5 of Form 8-K - "Other
            Events").

         o  On March 1, 2002, the Company filed a Current Report on Form 8-K to
            update our description of the Sands legal proceeding (Item 5 of Form
            8-K - "Other Events").



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<PAGE>


                                   SIGNATURES

         Pursuant to the requirements of the Securities Exchange Act of 1934, we
have duly caused this report to be signed on our behalf by the undersigned.

DATE: March 15, 2002

                                 GENEREX BIOTECHNOLOGY CORPORATION


                                 By: /s/ E. Mark Perri
                                     -------------------------------------
                                     E. Mark Perri
                                     Chairman and Chief Financial Officer


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