---

UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington, D.C.
20549

FORM 10-Q

(Mark One)

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

For the quarterly period ended July 31, 2010

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

For the transition period from ________to ________

COMMISSION FILE NUMBER000-51261

CALECO PHARMA CORP.(Exact
name of registrant as specified in its charter)

|NEVADA                                                               | 20-1147435                          
|-------------------------------------------------------------------- | ------------------------------------
|(State or other jurisdiction of incorporation or
      organization) | (I.R.S. Employer Identification No.)

|59 East Mill Road, Building 4, Suite 201  |           
|----------------------------------------- | ----------
|Long Valley, NJ                           | 07853     
|(Address of principal executive officers) | (Zip Code)

(908) 752-4240
  (Registrant's telephone number,
including area code)

Former Telephone Number: (360) 306-1133
  (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 to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. [X]Yes[  ] No

Indicate by check mark whether the registrant has submitted
electronically and posted on its corporate Web site, if any, every Interactive
Data File required to be submitted and posted pursuant to Rule 405 of Regulation
S-T (§232.405 of this chapter) during the preceding 12 months (or for such
shorter period that the registrant was required to submit and post such files).
[  ]Yes [  ] No

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

|Large accelerated filer [  ]                                                       | Accelerated filer [  ]               
|---------------------------------------------------------------------------------- | -------------------------------------
|Non-accelerated filer [  ]   (Do not check
        if a smaller reporting company) | Smaller reporting company
        [X]

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

Indicate the number of shares outstanding of each of the
issuer's classes of common stock, as of the latest practicable date: As of
September 15, 2010, the Issuer had 89,551,340 shares of common stockoutstanding.

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PART I - FINANCIAL INFORMATION

|ITEM 1. | FINANCIAL STATEMENTS.
|------- | ---------------------

The accompanying unaudited financial statements have been
prepared in accordance with the instructions to Form 10-Q and Rule 8-03 of
Regulation S-X, and, therefore, do not include all information and footnotes
necessary for a complete presentation of financial position, results of
operations, cash flows, and stockholders' equity in conformity with generally
accepted accounting principles. In the opinion of management, all adjustments
considered necessary for a fair presentation of the results of operations and
financial position have been included and all such adjustments are of a normal
recurring nature. Operating results for the three and nine months ended July 31,
2010 are not necessarily indicative of the results that can be expected for the
year ending October 31, 2010.

As used in this Quarterly Report on Form 10-Q, the terms "we,
"us, "our, Caleco and the Company mean Caleco Pharma Corp. All dollar
amounts in this Quarterly Report are in U.S. dollars unless otherwise stated.

2



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CALECO PHARMA CORP.

(formerly Blackstone Lake Minerals Inc.)

(A Development Stage Company)

****

CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in U.S. Dollars)



July 31, 2010(Unaudited)

---

|CALECO PHARMA CORP.                     
|----------------------------------------
|(formerly Blackstone Lake Minerals Inc.)
|(A Development Stage Company)           
|CONSOLIDATED BALANCE SHEETS             
|(Expressed in U.S. Dollars)             
|(Unaudited)                             

|                                                                                                                                    |   | July 31,   |   |   | October 31, |  
|----------------------------------------------------------------------------------------------------------------------------------- | - | ---------- | - | - | ----------- | -
|                                                                                                                                    |   | 2010       |   |   | 2009        |  
|                                                                                                                                    |   |            |   |   |             |  
|ASSETS                                                                                                                              |   |            |   |   |             |  
|                                                                                                                                    |   |            |   |   |             |  
|Current Assets                                                                                                                      |   |            |   |   |             |  
|Cash and cash equivalents                                                                                                           | $ | 576        |   | $ | 271,106     |  
|Deferred tax asset, less valuation
      allowance of $2,078,861 (2009 -$1,806,741)                                                 |   | -          |   |   | -           |  
|Total Current Assets                                                                                                                |   | 576        |   |   | 271,106     |  
|Investment (Note 4)                                                                                                                 |   | 491        |   |   | -           |  
|Intangibles (Note 6)                                                                                                                |   | 691,331    |   |   | 691,331     |  
|Total Assets                                                                                                                        |   | 692,398    |   |   | 962,437     |  
|                                                                                                                                    |   |            |   |   |             |  
|LIABILITIES AND
      STOCKHOLDERS EQUITY (DEFICIENCY)                                                                             |   |            |   |   |             |  
|                                                                                                                                    |   |            |   |   |             |  
|Current Liabilities                                                                                                                 |   |            |   |   |             |  
|Accounts payable and
      accrued liabilities                                                                                      | $ | 380,510    |   | $ | 447,488     |  
|Accounts
      payable and accrued liabilities related parties (Note 8)                                                            |   | 125,650    |   |   | 149,987     |  
|Loans Payable (Note 7)                                                                                                              |   | 409,908    |   |   | 326,210     |  
|Total Current Liabilities                                                                                                           |   | 916,068    |   |   | 923,685     |  
|                                                                                                                                    |   |            |   |   |             |  
|Commitments and
      Contractual Obligations (Note 10, 11, 12)                                                                     |   |            |   |   |             |  
|                                                                                                                                    |   |            |   |   |             |  
|Stockholders Equity
      (Deficiency)                                                                                             |   |            |   |   |             |  
|Common stock (Note 9)                                                                                                               |   |            |   |   |             |  
|Authorized                975,000,000
      common shares, par value $0.001                                                         |   |            |   |   |             |  
|Issued and
      outstanding                July
      31, 2010
      -89,226,340                October
      31, 2009 -83,073,744 |   | 89,227     |   |   | 83,074      |  
|Additional paid-in capital                                                                                                          |   | 6,249,516  |   |   | 5,557,076   |  
|Subscriptions received                                                                                                              |   | -          |   |   | 160,663     |  
|Accumulated other comprehensive loss:                                                                                               |   |            |   |   |             |  
|Foreign currency cumulative translation adjustment                                                                                  |   | (174,074   | ) |   | (174,074    | )
|Deficit                                                                                                                             |   | (718,605   | ) |   | (718,605    | )
|Deficit accumulated during the development
      stage                                                                              |   | (5,669,734 | ) |   | (4,869,382  | )
|Total Stockholders Equity (Deficiency)                                                                                             |   | (223,670   | ) |   | 38,752      |  
|                                                                                                                                    |   |            |   |   |             |  
|Total Liabilities and Stockholders Equity
      (Deficiency)                                                                       | $ | 692,398    |   | $ | 962,437     |  

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

F-2

---

|CALECO PHARMA CORP.                                               
|------------------------------------------------------------------
|(formerly Blackstone Lake Minerals Inc.)                          
|(A Development Stage Company)                                     
|CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE
      LOSS
|(Expressed in U.S. Dollars)                                       
|(Unaudited)                                                       

|                                                                      |   | Cumulative             |   |   |            |   |   |            |   |   |            |   |   |            |  
|--------------------------------------------------------------------- | - | ---------------------- | - | - | ---------- | - | - | ---------- | - | - | ---------- | - | - | ---------- | -
|                                                                      |   | Amounts                |   |   |            |   |   |            |   |   |            |   |   |            |  
|                                                                      |   | From October
      19, |   |   | Nine       |   |   | Nine       |   |   | Three      |   |   | Three      |  
|                                                                      |   | 2007(start of the      |   |   | Months     |   |   | Months     |   |   | Months     |   |   | Months     |  
|                                                                      |   | development stage),    |   |   | Ended      |   |   | Ended      |   |   | Ended      |   |   | Ended      |  
|                                                                      |   | to July 31,            |   |   | July 31,   |   |   | July 31,   |   |   | July 31,   |   |   | July 31,   |  
|                                                                      |   | 2010                   |   |   | 2010       |   |   | 2009       |   |   | 2010       |   |   | 2009       |  
|                                                                      |   |                        |   |   |            |   |   |            |   |   |            |   |   |            |  
|EXPENSES                                                              |   |                        |   |   |            |   |   |            |   |   |            |   |   |            |  
|                                                                      |   |                        |   |   |            |   |   |            |   |   |            |   |   |            |  
|Management fees                                                       | $ | 152,002                |   | $ | 70,500     |   | $ | 22,500     |   | $ | 49,500     |   | $ | 7,500      |  
|Mineral
      exploration costs                                       |   | 13,710                 |   |   | -          |   |   | -          |   |   | -          |   |   | -          |  
|Professional fees                                                     |   | 992,434                |   |   | 589,752    |   |   | 115,756    |   |   | 66,306     |   |   | 17,911     |  
|Other
      operating expenses                                        |   | 439,622                |   |   | 172,257    |   |   | 214,212    |   |   | 36,411     |   |   | 34,776     |  
|Foreign currency loss
      (gain)                                    |   | 33,424                 |   |   | (40,730    | ) |   | 60,397     |   |   | (13,186    | ) |   | 49,195     |  
|                                                                      |   |                        |   |   |            |   |   |            |   |   |            |   |   |            |  
|LOSS BEFORE
      OTHER ITEMS AND INCOME TAXES                        |   | 1,631,192              |   |   | 791,779    |   |   | 412,865    |   |   | 139,031    |   |   | 109,382    |  
|                                                                      |   |                        |   |   |            |   |   |            |   |   |            |   |   |            |  
|Interest expense                                                      |   | 103,671                |   |   | 9,064      |   |   | 43,811     |   |   | 3,045      |   |   | 15,271     |  
|Write off of
      mineral property                                   |   | 200,000                |   |   | -          |   |   | -          |   |   | -          |   |   | -          |  
|Write off of account payable                                          |   | (45,743                | ) |   | -          |   |   | -          |   |   | -          |   |   | -          |  
|Grant of license                                                      |   | (491                   | ) |   | (491       | ) |   | -          |   |   | -          |   |   | -          |  
|                                                                      |   |                        |   |   |            |   |   |            |   |   |            |   |   |            |  
|LOSS BEFORE INCOME TAXES                                              |   | 1,888,629              |   |   | 800,352    |   |   | 456,676    |   |   | 142,076    |   |   | 124,653    |  
|                                                                      |   |                        |   |   |            |   |   |            |   |   |            |   |   |            |  
|Provision for income taxes                                            |   | -                      |   |   | -          |   |   | -          |   |   | -          |   |   | -          |  
|                                                                      |   |                        |   |   |            |   |   |            |   |   |            |   |   |            |  
|LOSS FROM CONTINUING
      OPERATIONS                                 |   | 1,888,629              |   |   | 800,352    |   |   | 456,676    |   |   | 142,076    |   |   | 124,653    |  
|                                                                      |   |                        |   |   |            |   |   |            |   |   |            |   |   |            |  
|Discontinued operations                                               |   | 3,781,105              |   |   | -          |   |   | -          |   |   | -          |   |   | -          |  
|                                                                      |   |                        |   |   |            |   |   |            |   |   |            |   |   |            |  
|NET LOSS                                                              |   | 5,669,734              |   |   | 800,352    |   |   | 456,676    |   |   | 142,076    |   |   | 124,653    |  
|                                                                      |   |                        |   |   |            |   |   |            |   |   |            |   |   |            |  
|OTHER COMPREHENSIVE LOSS                                              |   |                        |   |   |            |   |   |            |   |   |            |   |   |            |  
|                                                                      |   |                        |   |   |            |   |   |            |   |   |            |   |   |            |  
|Foreign currency translation
      adjustment                         |   | 151,900                |   |   | -          |   |   | -          |   |   | -          |   |   | -          |  
|                                                                      |   |                        |   |   |            |   |   |            |   |   |            |   |   |            |  
|COMPREHENSIVE LOSS                                                    | $ | 5,821,634              |   | $ | 800,352    |   | $ | 456,676    |   | $ | 142,076    |   | $ | 124,653    |  
|                                                                      |   |                        |   |   |            |   |   |            |   |   |            |   |   |            |  
|BASIC AND DILUTED NET LOSS FROM
      CONTINUING OPERATIONS PER SHARE |   |                        |   | $ | (0.01      | ) | $ | (0.01      | ) | $ | (0.00      | ) | $ | (0.00      | )
|                                                                      |   |                        |   |   |            |   |   |            |   |   |            |   |   |            |  
|WEIGHTED AVERAGE NUMBER OF COMMON SHARES
      OUTSTANDING            |   |                        |   |   | 87,421,929 |   |   | 70,200,000 |   |   | 89,060,398 |   |   | 70,200,000 |  

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

F-3

---

|CALECO PHARMA CORP.                     
|----------------------------------------
|(formerly Blackstone Lake Minerals Inc.)
|(A Development Stage Company)           
|CONSOLIDATED STATEMENTS OF CASH FLOWS   
|(Expressed in U.S. Dollars)             
|(Unaudited)                             

|                                                                                                            |   | Cumulative         |   |   |          |   |   |          |  
|----------------------------------------------------------------------------------------------------------- | - | ------------------ | - | - | -------- | - | - | -------- | -
|                                                                                                            |   | Amounts            |   |   |          |   |   |          |  
|                                                                                                            |   | From October 19,   |   |   | Nine     |   |   | Nine     |  
|                                                                                                            |   | 2007(start of the  |   |   | Months   |   |   | Months   |  
|                                                                                                            |   | development stage) |   |   | Ended    |   |   | Ended    |  
|                                                                                                            |   | to July 31,        |   |   | July 31, |   |   | July 31, |  
|                                                                                                            |   | 2010               |   |   | 2010     |   |   | 2009     |  
|                                                                                                            |   |                    |   |   |          |   |   |          |  
|CASH FLOWS
      FROM OPERATING ACTIVITIES                                                                  |   |                    |   |   |          |   |   |          |  
|Net loss from continuing
      operations                                                                   | $ | (1,888,629         | ) |   | (800,352 | ) | $ | (456,676 | )
|Adjustments to
      reconcile net loss to cash used in operating activities:                               |   |                    |   |   |          |   |   |          |  
|Write off of
      mineral property                                                                         |   | 200,000            |   |   | -        |   |   | -        |  
|Write off of accounts payable                                                                               |   | (45,743            | ) |   | -        |   |   | -        |  
|Issuance of
      capital stock for services                                                                |   | 130,800            |   |   | 120,000  |   |   | -        |  
|Grant of license                                                                                            |   | (491               | ) |   | (491     | ) |   | -        |  
|Change in operating assets and
      liabilities:                                                           |   |                    |   |   |          |   |   |          |  
|Increase (decrease) in accounts payable and accrued liabilities                                             |   | 37,279             |   |   | (45,978  | ) |   | 254,693  |  
|Increase (decrease) in accounts
      payable and accrued
      liabilities                related parties |   | 120,295            |   |   | (24,337  | ) |   | 37,795   |  
|Increase (decrease) in accrued interest payable                                                             |   | 47,587             |   |   | (26,290  | ) |   | 41,311   |  
|Net cash used in operating
      activities of discontinued operations                                      |   | (103,029           | ) |   | -        |   |   | -        |  
|                                                                                                            |   |                    |   |   |          |   |   |          |  
|Net cash used in operating
      activities                                                                 |   | (1,501,931         | ) |   | (777,448 | ) |   | (122,877 | )
|                                                                                                            |   |                    |   |   |          |   |   |          |  
|CASH FLOWS FROM INVESTING
      ACTIVITIES                                                                  |   |                    |   |   |          |   |   |          |  
|Acquisition of mineral property                                                                             |   | (200,000           | ) |   | -        |   |   | -        |  
|Acquisition of intangibles                                                                                  |   | (22,500            | ) |   | -        |   |   | (22,500  | )
|                                                                                                            |   |                    |   |   |          |   |   |          |  
|Net cash used in investing
      activities                                                                 |   | (222,500           | ) |   | -        |   |   | (22,500  | )
|                                                                                                            |   |                    |   |   |          |   |   |          |  
|CASH FLOWS FROM FINANCING
      ACTIVITIES                                                                  |   |                    |   |   |          |   |   |          |  
|Proceeds from loans payable, net                                                                            |   | 119,018            |   |   | 124,988  |   |   | 10,200   |  
|Issuance of
      capital stock for cash                                                                    |   | 1,282,243          |   |   | 381,930  |   |   | -        |  
|Subscriptions received                                                                                      |   | -                  |   |   | -        |   |   | 150,400  |  
|Net cash provided by financing
      activities of discontinued operations                                  |   | 74,379             |   |   | -        |   |   | -        |  
|                                                                                                            |   |                    |   |   |          |   |   |          |  
|Net cash provided by financing
      activities                                                             |   | 1,475,640          |   |   | 506,918  |   |   | 160,600  |  
|                                                                                                            |   |                    |   |   |          |   |   |          |  
|EFFECT OF FOREIGN CURRENCY TRANSLATION ON
      CASH DURING THE PERIOD                                      |   | 3,755              |   |   | -        |   |   | -        |  
|                                                                                                            |   |                    |   |   |          |   |   |          |  
|NET INCREASE (DECREASE) IN CASH                                                                             |   | (245,036           | ) |   | (270,530 | ) |   | 15,223   |  
|                                                                                                            |   |                    |   |   |          |   |   |          |  
|CASH, BEGINNING OF PERIOD                                                                                   |   | 245,612            |   |   | 271,106  |   |   | 52       |  
|                                                                                                            |   |                    |   |   |          |   |   |          |  
|CASH, END OF PERIOD                                                                                         | $ | 576                |   | $ | 576      |   | $ | 15,275   |  
|                                                                                                            |   |                    |   |   |          |   |   |          |  
|CASH DISCONTINUED OPERATIONS                                                                               | $ | -                  |   | $ | -        |   | $ | -        |  
|CASH CONTINUING OPERATIONS                                                                                 | $ | 576                |   | $ | 576      |   | $ | 1,259    |  

Supplemental Disclosure with Respect to Cash Flows (Note
13)

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

F-4

---

|CALECO PHARMA CORP.                           
|----------------------------------------------
|(formerly Blackstone Lake Minerals Inc.)      
|(A Development Stage Company)                 
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
|(Expressed in U.S. Dollars)                   
|July 31, 2010                                 
|(Unaudited)                                   
|                                              

|1. | HISTORY AND ORGANIZATION OF THE COMPANY                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|-- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   | Caleco Pharma Corp. (formerly Blackstone Lake Minerals
      Inc.) (the Company) was incorporated on May 18, 2004, under the laws of
      the State of Nevada and was in the business of exploring mineral
      properties. Effective April 19, 2006, the Company acquired 100% of the
      issued and outstanding shares of Skyflyer Technology GmbH (Skyflyer
      Technology), a company engaged in the development and commercialization
      of a one or two person, recreation flying device. On October 18, 2007, the
      Company acquired a 100% interest in a mineral claim (the Blackstone Lake
      Property) in Saskatchewan, Canada. The Company was focusing its resources
      on the development and exploration of the Blackstone Lake Property and on
      April 11, 2008, the Company sold its interest in Skyflyer Technology. On
      January 27, 2009, pursuant to a technology purchase agreement with NY
      Financial (International) Corp. (NY Financial), the Companys former
      wholly-owned subsidiary, Caleco Pharma Corp. (Caleco-Sub), acquired a
      proprietary technology and the intellectual property related thereto for
      the treatment of liver disease and other ailments, particularly resulting
      from viral infections such as the Hepatitis C virus infection (the
      Technology) (Note 11). The Company has also developed or is in the
      process of developing food supplements, hair and dermatological products,
      energy drinks and chewing gum that derive their formulations from the
      Technology. These products are being developed to provide enhancement to
      an individuals immune system. On March 12, 2010, the Company entered into
      an exclusive license agreement with Natac Biotech S.L. (Natac), a
      Spanish biotechnology corporation engaged in the research and development
      of health related products, whereby Natac has granted the Company the
      exclusive right to develop, commercialize, market and distribute five
      compounds (AOF, AH- FLO, JHF, HGF, NB-VAL40) derived from plant extracts
      throughout North and South America (Note 12). On November 22, 2009, the
      Company allowed the Blackstone Lake Property to lapse and as a result, the
      Company wrote down the mineral property to $Nil at October 31, 2009. The
      Company is considered to be a development stage company, as it has not
      generated significant revenues from operations.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   | The consolidated financial statements of the Company from
      up until July 31, 2009 included the accounts of the Company and its former
      wholly-owned subsidiary, Caleco-Sub. All inter-company balances and
      transactions were eliminated on consolidation. Effective August 31, 2009,
      the Company changed its name to Caleco Pharma Corp. To effect the name
      change, the Company completed a merger of Caleco-Sub, with and into the
      company, with the Company continuing as the sole surviving
  entity.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   | These unaudited financial statements have been prepared
      in conformity with generally accepted accounting principles in the United
      States of America for interim financial information. The accompanying
      unaudited financial statements do not include all information and footnote
      disclosures required for an annual set of financial statements prepared
      under United States of America generally accepted accounting principles.
      In the opinion of management, all adjustments (consisting solely of normal
      recurring accruals) considered necessary for a fair presentation of
      financial position, results of operations and cash flows as at July 31,
      2010 and for all periods presented, have been included. Interim results
      for the period ended July 31, 2010 are not necessarily indicative of the
      results that may be expected for the fiscal year as a
  whole.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 

F-5

---

|CALECO PHARMA CORP.                           
|----------------------------------------------
|(formerly Blackstone Lake Minerals Inc.)      
|(A Development Stage Company)                 
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
|(Expressed in U.S. Dollars)                   
|July 31, 2010                                 
|(Unaudited)                                   
|                                              

|2. | GOING CONCERN                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|   | These financial statements have been prepared with the
      on-going assumption that the Company will be able to realize its assets
      and discharge its liabilities in the normal course of business. However,
      certain conditions noted below raise substantial doubt about the Companys
      ability to continue as a going concern. These financial statements do not
      include any adjustments to the amounts and classifications of assets and
      liabilities that might be necessary should the Company be unable to
      continue as a going concern.                                                                                                                                                                                                                                                                       
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|   | The operations of the Company have primarily been funded
      by the sale of common stock and loans received. Continued operations of
      the Company are dependent on the Companys ability to complete equity
      financings or generate profitable operations in the future. Managements
      plan in this regard is to secure additional funds through future equity
      financings. Such financings may not be available or may not be available
      on reasonable terms to the Company.                                                                                                                                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|3. | SIGNIFICANT ACCOUNTING POLICIES                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|   | The financial statements of the Company have been
      prepared in conformity with generally accepted accounting principles in
      the United States of America and are stated in U.S. dollars. The
      significant accounting policies adopted by the Company are as
    follows:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|   | **(a)** **Use of
    estimates**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|   | The preparation of financial statements in conformity
      with generally accepted accounting principles in the United States
      requires management to make estimates and assumptions that affect the
      reported amounts of assets and liabilities and the disclosure of
      contingent assets and liabilities at the date of the financial statements
      and the reported amount of revenues and expenses during the reporting
      period. Actual results could differ from these estimates.                                                                                                                                                                                                                                                                                                                                          
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|   | **(b)** **Foreign currency
      translation**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|   | The functional currency of the Company is the U.S.
      dollar. The Companys former subsidiary, Caleco-Sub, used the U.S. dollar
      as its functional currency. The Companys former subsidiary, Skyflyer
      Technology, used the Euro as its functional currency. Accordingly,
      monetary assets and liabilities denominated in a foreign currency were
      translated at the exchange rate in effect at the balance sheet date while
      non-monetary assets and liabilities were translated at historical rates. Revenue
      and expense items denominated in a foreign currency were translated at
      exchange rates prevailing when such items are recognized in the statement
      of operations. Exchange gains and losses arising on translation of foreign
  currency items are included in the statement of operations.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|   | The Company followed the current rate method of
      translation to U.S. dollars with respect to its former foreign subsidiary.
      Accordingly, assets and liabilities were translated into U.S. dollars at
      the year-end exchange rates while revenue and expenses were translated at
      the average exchange rates during the year. Related exchange gains and
      losses are included in a separate component of stockholders equity as
      accumulated other comprehensive loss.                                                                                                                                                                                                                                                                                                                                                  

F-6

---

|CALECO PHARMA CORP.                           
|----------------------------------------------
|(formerly Blackstone Lake Minerals Inc.)      
|(A Development Stage Company)                 
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
|(Expressed in U.S. Dollars)                   
|July 31, 2010                                 
|(Unaudited)                                   
|                                              

|3. | SIGNIFICANT ACCOUNTING POLICIES
  (continued)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|-- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   | (c) Cash and cash equivalents                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   | The Company considers cash held at banks and all highly
      liquid investments with original maturities of three months or less to be
      cash and cash equivalents. At July 31, 2010 and October 31, 2009, the
      Company had no cash equivalents.                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   | (d) Investments                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   | The Company accounts for investments in companies subject
      to significant influence (generally those companies in which interests
      ranging from 20% to 50% are held) on the equity basis. Investments in
      companies that the Company is unable to significantly influence are
      carried at cost.                                                                                                                                                                                                                                                                                                                                                                                  
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   | Investments in which the Company holds a 51% or greater
      interest are consolidated, unless control does not exist due to the
      Companys inability to determine the investees strategic operating,
      financing and investing policies.                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   | (e) Intangibles                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   | Intangibles are recorded at cost. Capitalized amounts
      relate to purchase costs and legal, consulting and advisory costs incurred
      in registration of the patents and intellectual property. Depreciation is
      calculated using the straight-line method over the useful lives of the
      assets. No depreciation is provided for as the patents have not yet been
      awarded and/or begun to generate revenues. No depreciation is provided for
      the intellectual property as they have indefinite lives.                                                                                                                                                                   
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   | (f) Accounting for the impairment of long-lived
      assets and long-lived assets to be disposed of                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   | The Company reviews all long-lived assets for impairment
      whenever events or changes in circumstances indicate that the carrying
      amount of an asset may not be recoverable. Recoverability of assets to be
      held and used is measured by a comparison of the carrying amount of an
      asset to future net cash flows expected to be generated by the asset. If
      such assets are considered to be impaired, the impairment recognized is
      measured by the amount by which the carrying amount of the assets exceeds
      the fair value of the assets. Assets to be disposed of are reported at the
      lower of the carrying amount or fair value less costs to sell.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   | (g) Income taxes                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   | A deferred tax asset or liability is recorded for all
      temporary differences between financial and tax reporting and net
      operating loss carryforwards. Deferred tax expenses (benefit) result from
      the net change during the period of deferred tax assets and
      liabilities.                                                                                                                                                                                                                                                                                                                                                                                                   
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   | Deferred tax assets are reduced by a valuation allowance
      when, in the opinion of management, it is more likely than not that some
      portion or all of the deferred tax assets will not be realized. Deferred
      tax assets and liabilities are adjusted for the effects of changes in tax
      laws and rates on the date of enactment.                                                                                                                                                                                                                                                                                                                                                

F-7

---

|CALECO PHARMA CORP.                           
|----------------------------------------------
|(formerly Blackstone Lake Minerals Inc.)      
|(A Development Stage Company)                 
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
|(Expressed in U.S. Dollars)                   
|July 31, 2010                                 
|(Unaudited)                                   
|                                              

|3. | SIGNIFICANT ACCOUNTING POLICIES
  (continued)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|-- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   | (h) Fair value of financial instruments                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   | The Company's financial instruments consist of cash and
      cash equivalents, investment, accounts payable and accrued liabilities,
      accounts payable and accrued liabilities related parties, and loans
      payable. Unless otherwise noted, it is management's opinion that the
      Company is not exposed to significant interest, currency or credit risks
      arising from these financial instruments. The fair value of these
      financial instruments approximates their carrying values, unless otherwise
      noted.                                                                                      
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   | (i) Stock-based compensation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   | The Company accounts for share-based compensation under
      the provisions of ASC 718, Compensation-Stock Compensation. Under the
      fair value recognition provisions, stock-based compensation expense is
      measured at the grant date for all stock-based awards to employees and
      directors and is recognized as an expense over the requisite service
      period, which is generally the vesting period. The Black-Scholes option
      valuation model is used to calculate fair value.                                                                                                                       
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   | The Company accounts for stock compensation arrangements
      with non-employees in accordance with ASC 718 which require that such
      equity instruments are recorded at their fair value on the measurement
      date. The measurement of stock-based compensation is subject to periodic
      adjustment as the underlying equity instruments vest. Non-employee
      stock-based compensation charges are amortized over the vesting period on
      a straight-line basis. For stock options granted to non-employees, the
      fair value of the stock options is estimated using a Black-Scholes
      valuation model.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   | (j) Net loss per share                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   | Basic net loss per share is computed by dividing the net
      loss for the year by the weighted average number of shares of common stock
      outstanding during the year. Diluted earnings per share takes into
      consideration shares of common stock outstanding (computed under basic
      earnings per share) and potentially dilutive shares of common stock. As of
      July 31, 2010 and 2009, there were no potentially dilutive securities
      outstanding.                                                                                                                                                       
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   | (k) Comprehensive loss                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   | The Company has adopted Accounting Standards
      Codificiation (ASC) 220-10 formerly SFAS 130, Reporting of
      Comprehensive Income,which establishes guidelines for the reporting
      and display of comprehensive loss/and its components in financial
      statements. Comprehensive loss includes foreign currency translation
      adjustments.                                                                                                                                                                                                                                                                     
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   | (l) Development stage                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   | The Company is a development stage company as defined by
      ASC 205-915-20 formerly SFAS 7, Accounting and Reporting by
      Development Stage Enterprises,as it is devoting substantially all of
      its efforts to establish a new business and planned principal operations
      have not commenced.                                                                                                                                                                                                                                                                                                                      

F-8

---

|CALECO PHARMA CORP.                           
|----------------------------------------------
|(formerly Blackstone Lake Minerals Inc.)      
|(A Development Stage Company)                 
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
|(Expressed in U.S. Dollars)                   
|July 31, 2010                                 
|(Unaudited)                                   
|                                              

|3. | SIGNIFICANT ACCOUNTING POLICIES
  (continued)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|-- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   | (m) Concentration of credit risk                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   | Cash is the only financial instrument that potentially
      subjects the Company to concentration of credit risk. The Company
      maintains cash in bank accounts that, at times, may exceed federally
      insured limits. The Company has not experienced any losses in such
      accounts and believes it is not exposed to any significant risks on its
      cash in bank accounts.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   | (n) Recent accounting pronouncements                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   | In October 2009, the FASB issued ASU 2009-13, Revenue
      Recognition (Topic 605), Multiple-Deliverable Revenue Arrangementsamending ASC 605. ASU 2009-13 requires entities to allocate revenue in
      an arrangement using estimated selling prices of the delivered goods and
      services based on a selling price hierarchy. ASU 2009-13 eliminates the
      residual method of revenue allocation and requires revenue to be allocated
      using the relative selling price method. ASU 2009-13 is effective
      prospectively for revenue arrangements entered into or materially modified
      in fiscal years beginning on or after June 15, 2010. The Company is
      currently evaluating the impact of ASU 2009-13, but does not expect its
      adoption to have a material impact on the Companys financial position or
      results of operations.                                                                                            
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   | In January 2010, the FASB issued ASU 2010-06, Fair
      Value Measurements and Disclosures (Topic 820), Improving Disclosures
      about Fair Value Measurements,amending ASC 820. ASU 2010-06 requires
      entities to provide new disclosures and clarify existing disclosures
      relating to fair value measurements. The new disclosures and
      clarifications of existing disclosures are effective for interim and
      annual reporting periods beginning after December 15, 2009, except for the
      disclosures about purchases, sales, issuances, and settlements in Level 3
      fair value measurements, which are effective for fiscal years beginning
      after December 15, 2010 and for interim periods within those fiscal years.
      The Company is currently evaluating the impact of ASU 2010-06, but does
      not expect its adoption to have a material impact on the Companys
      financial position or results of operations.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   | In February 2010, the FASB issued ASU 2010-09,
      Subsequent Events (Topic 855),amending ASC 855. ASU 2010-09
      removes the requirement for an SEC filer to disclose a date relating to
      its subsequent events in both issued and revised financial statements. ASU
      2010-09 also eliminates potential conflicts with the SECs literature.
      Most of ASU 2010-09 is effective upon issuance of the update. The Company
      adopted ASU 2010- 09 in February 2010, and its adoption did not have a
      material impact on the Companys financial reporting and
    disclosures.                                                                                                                                                                                                                                                                                                                                                                   
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   | (o) Reclassifications                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       

Certain amounts reported in the prior period have been
reclassified to conform to the current periods presentation.

F-9

---

|CALECO PHARMA CORP.                           
|----------------------------------------------
|(formerly Blackstone Lake Minerals Inc.)      
|(A Development Stage Company)                 
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
|(Expressed in U.S. Dollars)                   
|July 31, 2010                                 
|(Unaudited)                                   
|                                              

|4. | INVESTMENT                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|-- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|   | On November 1, 2009 the Company acquired 334 shares,
      representing a 10% interest, in Caleco Pharma Europe S.L. (SL), a Spanish
      Corporation, pursuant to a license agreement (see Note 12) for
      consideration of Euro 334 (US $491).                                                                                                                                                                                                                                                                                                                                    
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|5. | MINERAL PROPERTY                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|   | On October 18, 2007, the Company completed the
      acquisition of a mineral property (the Blackstone Lake Property) under
      the terms of a purchase agreement entered into by the Company on October
      3, 2007. The Blackstone Lake Property consisted of two mineral claims
      located in Saskatchewan, Canada. The mineral claims were in good standing
      until August 22, 2009 and as of November 22, 2009, the claims officially
      lapsed. Accordingly, the Company wrote off all associated costs to
      operations during the year ended October 31, 2009.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|6. | INTANGIBLES                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              

| |                                 |   | July 31, |  |   | October 31, | 
| | ------------------------------- | - | -------- |  | - | ----------- | 
| |                                 |   | 2010     |  |   | 2009        | 
| |                                 |   |          |  |   |             | 
| | Patents (Note 11)               | $ | 80,000   |  | $ | 80,000      | 
| | Intellectual property (Note 11) |   | 611,331  |  |   | 611,331     | 
| |                                 |   | 691,331  |  |   | 691,331     | 
| | Accumulated amortization        |   | -        |  |   | -           | 
| |                                 |   |          |  |   |             | 
| | Net book value                  | $ | 691,331  |  | $ | 691,331     | 

During the period ended July 31, 2010,
the Company did not amortize $80,000 and $611,311 of its patents and
intellectual property as the patents have not yet been awarded and/or they have
not begun to generate revenues and the intellectual property has an indefinite
life. Capitalized amounts relate to purchase costs and legal, consulting and
advisory costs incurred in registration of the patents and intellectual
property.

F-10

---

|CALECO PHARMA CORP.                           
|----------------------------------------------
|(formerly Blackstone Lake Minerals Inc.)      
|(A Development Stage Company)                 
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
|(Expressed in U.S. Dollars)                   
|July 31, 2010                                 
|(Unaudited)                                   
|                                              

|7. | LOANS PAYABLE                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|   | During the nine months ended July 31, 2010, a loan was
      granted from Natac for Euro130,000 (US $169,536) pursuant to a proposed
      lab facilities and service agreement (Note 10 -vii). During the nine
      months ended July 31, 2010, Euro 11,625 (US $15,161) was repaid. The loan
      is non-interest bearing and was due September 10, 2010 and has not been
      paid.                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|   | During the year ended October 31, 2009, Euro 112,000 (US
      $146,062) in accounts payable was reclassified to loans payable. The loans
      are non-interest bearing. One loan of Euro 56,000 (US $73,031) was due
      February 1, 2010 and has not been paid. The second loan of Euro 56,000 (US
      $73,031) was due June 1, 2010 and has not been paid.                                                                                                                                                                                                                                                      
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|   | During the year ended October 31, 2009, a loan was
      granted from a third party totaling $15,000. The loan is non-interest
      bearing and is due on demand. On January 15, 2010, the loan of $15,000 was
      settled for shares of the Companys common stock.                                                                                                                                                                                                                                                                                                                                                 
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|   | During the year ended October 31, 2009, a loan was
      granted from a third party company for $1,200. The loan bore interest at
      10% per annum and was due on demand. On October 5, 2009, the loan of
      $1,200 was settled for shares of the Companys common stock. Interest
      included in the statement of operations for the nine and three months
      ended July 31, 2009 totaled $31 and $31, respectively.                                                                                                                                                                                       
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|   | During the year ended October 31, 2009, a loan was
      granted from NY Financial totaling $77,500 of which $74,159 was repaid in
      the same period. The loan bears interest at 10% per annum, compounded
      monthly, beginning January 31, 2009 and is due on demand (Note 11).
      Interest expense included in the statement of operations for the nine
      months ended July 31, 2010 and 2009 totaled $262 and $3,620, respectively.
      Interest expense included in the statement of operations for the three
      months ended July 31, 2010 and 2009 totaled $91 and $1,762,
      respectively.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|   | During the year ended October 31, 2008, several loans
      were granted from a third party company totaling $47,000. The loans bore
      interest at 10% per annum and were due on demand. On October 5, 2009, the
      loans and accrued interest totaling $53,907 was settled for shares of the
      Companys common stock. Interest expense included in the statement of
      operations for the nine and three months ended July 31, 2009 totaled
      $4,157 and $1,300, respectively.                                                                                                                      
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|   | During the year ended October 31, 2008, several loans
      were granted from a third party company totaling $28,000. The loans bore
      interest at 10% per annum and were due on demand. On October 5, 2009, the
      loans and accrued interest totaling $32,339 was settled for shares of the
      Companys common stock. Interest expense included in the statement of
      operations for the nine and three months ended July 31, 2009 totaled
      $2,601 and $776.                                                                                                                                      
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|   | During the year ended October 31, 2008, several loans
      were granted from a third party company totaling $18,100. The loans bear
      interest at 10% per annum and are due on demand. On October 5, 2009, the
      loans and accrued interest totaling $21,203 was settled for shares of the
      Companys common stock. Interest expense included in the statement of
      operations for the nine and three months ended July 31, 2009 totaled
      $1,367 and $469, respectively.                                                                                                                         

F-11

---

|CALECO PHARMA CORP.                           
|----------------------------------------------
|(formerly Blackstone Lake Minerals Inc.)      
|(A Development Stage Company)                 
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
|(Expressed in U.S. Dollars)                   
|July 31, 2010                                 
|(Unaudited)                                   
|                                              

|7. | LOANS PAYABLE (continued)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   | During the year ended October 31, 2007, several loans
      were granted from a third party company totaling $290,000. Loans totaling
      $280,000 bear interest at 8% per annum, are compounded annually, and were
      due April 30, 2009. The loans were verbally extended with the same terms
      and were due on demand. A loan of $10,000 was non-interest bearing and had
      no specific terms of repayment. On October 1, 2007, the Company agreed to
      begin paying interest on this loan at 8% per annum and agreed to repay the
      loan on demand. On October 5, 2009, the loans and accrued interest
      totaling $335,114 was settled for shares of the Companys common stock.
      Interest expense included in the statement of operations for the nine and
      three months ended July 31, 2009 totaled $18,741 and $6,315,
      respectively.                                                                        
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   | During the year ended October 31, 2006, two loans were
      granted from a third party company for $50,000 and $100,000. The loans
      bear interest at 8% per annum, are compounded annually, and were due May
      16, 2008 and June 19, 2008 respectively. On each of the loans due dates,
      the loans were verbally extended with the same terms and are due on
      demand. During the year ended October 31, 2009, $41,111 of principal and
      $16,389 of accrued interest was paid. During the nine months ended July
      31, 2010, $9,646 of principal and $35,354 of accrued interest was paid.
      Interest expense included in the statement of operation for the nine
      months ended July 31, 2010 and 2009 totaled $8,802 and $13,294,
      respectively. Interest expense included in the statement of operations for
      the three months ended July 31, 2010 and 2009 totaled $2,954 and $4,618,
      respectively.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|8. | RELATED PARTY TRANSACTIONS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   | At July 31, 2010 and October 31, 2009, included in
      accounts payable and accrued liabilities related parties is $20,758 owed
      to a former director and officer of the Company for management fees and
      reimbursement of expenses. Amounts due to and from officers and directors
      are unsecured, non-interest bearing and due on demand. Management fees
      included in the statement of operations for the three and nine months
      ended July 31, 2010 and 2009 totaled $0 and $0.                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   | At July 31, 2010 and October 31, 2009, included in
      accounts payable and accrued liabilities related parties is Euro 5,000
      (US $6,520) and Euro 5,000 (US $7,380), respectively, owed to a company
      owned by a former officer and director of the Company for management fees.
      Amounts due to and from officers and directors are unsecured, non-interest
      bearing and due on demand. Management fees included in the statement of
      operations for the three and nine months ended July 31, 2010 and 2009
      totaled $0 and $0.                                                                                                                                                                                                                                                                                                                                                                                         
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   | At July 31, 2010 and October 31, 2009, included in
      accounts payable and accrued liabilities related parties is $41,372 and
      $64,849, respectively, owed to officers and/or directors of the Company
      for management fees and reimbursement of expenses. Consulting fees paid to
      officers and/or directors of the Company for the nine months ended July
      31, 2010 and 2009 totaled $70,500 and $22,500, respectively. Consulting
      fees paid to officers and/or directors of the Company for the three months
      ended July 31, 2010 and 2009 totaled 49,500 and $7,500, respectively.
      Amounts due to and from officers and directors are unsecured, non-interest
      bearing and due on demand. The consulting fees are included in management
      fees on the statement of operations.                                                                                                                       

F-12

---

|CALECO PHARMA CORP.                           
|----------------------------------------------
|(formerly Blackstone Lake Minerals Inc.)      
|(A Development Stage Company)                 
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
|(Expressed in U.S. Dollars)                   
|July 31, 2010                                 
|(Unaudited)                                   
|                                              

|8. | RELATED PARTY TRANSACTIONS (continued)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   | At July 31, 2010 and October 31, 2009 included in
      accounts payable and accrued liabilities related parties is $57,000 owed
      to a company owned by a director of the Company for consulting fees.
      Amounts due to and from officers and directors are unsecured, non-interest
      bearing and due on demand. Consulting fees included in the statement of
      operations for the nine months ended July 31, 2010 and 2009 totaled $0 and
      $0. Consulting fees included in the statement of operations for the three
      months ended July 31, 2010 and 2009 totaled $0 and $0.                                                                                                                                                                                                                                                         
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|9. | COMMON STOCK                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   | The Companys articles of incorporation allow it to issue
      up to 975,000,000 shares of common stock, par value $0.001. Effective
      September 30, 2005, the Company effected a stock split of its common stock
      by issuing thirteen new shares for each old share. Except as otherwise
      stated to the contrary in these financial statements, all references to
      shares and prices per shares have been adjusted to give retroactive effect
      to the stock split.                                                                                                                                                                                                                                                                                                                                                                      
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   | On June 14, 2004, the Company issued 39,000,000 shares of
      its common stock at $0.001 per share in a private placement
      transaction.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   | On July 4, 2004, the Company issued 16,250,000 shares of
      its common stock at $0.01 per share in a private placement
    transaction.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   | On October 25, 2004, the Company issued 14,950,000 shares
      of its common stock at $0.05 per share in a private placement
      transaction.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   | On April 19, 2006, the Company acquired all the issued
      and outstanding stock of Skyflyer Technology, which was accounted for as a
      recapitalization of the Company (Note 1) in exchange for 33,000,000 shares
      of common stock. The issued number of shares of common stock was that of
      the Company with adjustments made for differences in par value between the
      Company and Skyflyer Technology. On April 11, 2008, the Company completed
      a share exchange agreement with Inventa and Skyflyer Technology, whereby
      the Company sold to Inventa all of the issued and outstanding shares of
      Skyflyer Technology in exchange for the surrender of 33,000,000 shares of
      the Companys common stock for cancellation. On April 11, 2008, the
      Company cancelled the 33,000,000 shares of its common stock.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   | On September 21, 2009, the Company issued 5,936,500
      shares of its common stock at $0.10 per share for total proceeds of
      $593,651 in a private placement transaction. The Company also issued
      5,117,244 shares of its common stock at $0.10 per share for settlement of
      accounts payable and loans payable with an aggregate value totaling
      $511,724.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   | On October 5, 2009, the Company issued 750,000 shares of
      its common stock at $0.10 per share for total proceeds of $75,000 in a
      private placement transaction. The Company also issued 300,000 shares of
      its common stock at $0.10 per share for settlement of accounts payable
      with an aggregate value totaling $30,000.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   | On October 5, 2009, the Company issued 710,000 shares of
      its common stock at $0.10 per share for total proceeds of $71,000 in a
      private placement transaction.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        

F-13

---

|CALECO PHARMA CORP.                           
|----------------------------------------------
|(formerly Blackstone Lake Minerals Inc.)      
|(A Development Stage Company)                 
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
|(Expressed in U.S. Dollars)                   
|July 31, 2010                                 
|(Unaudited)                                   
|                                              

|9. | COMMON STOCK (continued)                                                                                                                                                                                                                                                                                                                                                                                           
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                    
|   | On October 6, 2009, the Company issued 60,000 shares of
      its common stock at $0.18 per share for consulting services with an
      aggregate value of $10,800. The consulting services are included in
      professional fees on the statement of operations.                                                                                                                                                
|   |                                                                                                                                                                                                                                                                                                                                                                                                                    
|   | On November 10, 2009, the Company issued 1,338,630 shares
      of its common stock at $0.10 per share for total proceeds of $133,863 in a
      private placement transaction.                                                                                                                                                                                                                                    
|   |                                                                                                                                                                                                                                                                                                                                                                                                                    
|   | On December 22, 2009, the Company issued 1,145,000 shares
      of its common stock at $0.10 per share for total proceeds of $114,500 in a
      private placement transaction. The Company also issued 100,000 shares of
      its common stock at $0.10 per share for settlement of accounts payable
      with an aggregate value totaling $10,000.                                                             
|   |                                                                                                                                                                                                                                                                                                                                                                                                                    
|   | On January 15, 2010, the Company issued 337,300 shares of
      its common stock at $0.10 per share for total proceeds of
  $33,730.                                                                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                                                                                                                                                                                                                    
|   | On January 15, 2010, the Company issued 200,000 shares of
      its common stock at $0.10 per share for total proceeds of $20,000 in a
      private placement transaction. The Company also issued 260,000 shares of
      its common stock at $0.10 per share for settlement of accounts payable
      with an aggregate value totaling $11,000 and loans payable with an
      aggregate value totaling $15,000.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                    
|   | On January 19, 2010, the Company issued 1,000,000 shares
      of its common stock at $0.10 per share for total proceeds of $100,000 in a
      private placement transaction.                                                                                                                                                                                                                                     
|   |                                                                                                                                                                                                                                                                                                                                                                                                                    
|   | On February 15, 2010, the Company issued 300,000 shares
      of its common stock at $0.27 per share for consulting services with an
      aggregate value of $81,000. The consulting services are included in
      professional fees on the statement of operations.                                                                                                                                             
|   |                                                                                                                                                                                                                                                                                                                                                                                                                    
|   | On February 18, 2010, the Company issued 365,000 shares
      of its common stock at $0.10 per share for total proceeds of $36,500 in a
      private placement transaction.                                                                                                                                                                                                                                       
|   |                                                                                                                                                                                                                                                                                                                                                                                                                    
|   | On February 18, 2010, the Company issued 140,000 shares
      of its common stock at $0.10 per share for total proceeds of $14,000 in a
      private placement transaction.                                                                                                                                                                                                                                       
|   |                                                                                                                                                                                                                                                                                                                                                                                                                    
|   | On May 4, 2010, the Company issued 666,666 shares of its
      common stock at $0.15 per share for total proceeds of $100,000 in a
      private placement transaction. A finders fee of $10,000 was paid on
      closing of the private placement.                                                                                                                                                              
|   |                                                                                                                                                                                                                                                                                                                                                                                                                    
|   | On June 11, 2010, the Company issued 300,000 shares of
      its common stock at $0.13 per share for consulting services with an
      aggregate value of $39,000. The consulting services are included in
      management fees on the statement of operations.                                                                                                                                                   

F-14

---

|CALECO PHARMA CORP.                           
|----------------------------------------------
|(formerly Blackstone Lake Minerals Inc.)      
|(A Development Stage Company)                 
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
|(Expressed in U.S. Dollars)                   
|July 31, 2010                                 
|(Unaudited)                                   
|                                              

|10. | COMMITMENTS
|--- | -----------
|    |            
|    | i)         
|    |            
|    | ii)        
|    |            
|    | iii)       
|    |            
|    | iv)        
|    |            
|    | v)         
|    |            
|    | vi)        
|    |            
|    |            

F-15

---

|CALECO PHARMA CORP.                           
|----------------------------------------------
|(formerly Blackstone Lake Minerals Inc.)      
|(A Development Stage Company)                 
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
|(Expressed in U.S. Dollars)                   
|July 31, 2010                                 
|(Unaudited)                                   
|                                              

|10. | COMMITMENTS (continued)
|--- | -----------------------
|    |                        
|    |                        
|    |                        
|    |                        
|    |                        
|    |                        
|    |                        
|    |                        

| | vii) | On February 18, 2010, the Company entered into a lab
      facilities and service agreement (the Lab Facilities and Service
      Agreement) with Natac whereby the Company will have access to Natacs
      laboratory facility and procure certain laboratory services from Natac in
      consideration of the following:
| | ---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |      |                                                                                                                                                                                                                                                                                                                                
| |      | (a)                                                                                                                                                                                                                                                                                                                            
| |      |                                                                                                                                                                                                                                                                                                                                
| |      | (b)                                                                                                                                                                                                                                                                                                                            
| |      |                                                                                                                                                                                                                                                                                                                                
| |      | (c)                                                                                                                                                                                                                                                                                                                            

| | (d) | Euro 125,000 (US $163,015) on or before each
of:
| | --- | ------------------------------------------------
| |     |                                                 
| |     | (i)                                             
| |     |                                                 
| |     | (ii)                                            

The closing of the Lab Facilities and
Service Agreement was expected to occur on or before March 19, 2010. The closing
date has been extended to September 10, 2010. The Company is currently in the
process of negotiating an extension to the Lab Facilities and Service Agreement
with Natac.

The closing of the Lab Facilities and
Service Agreement is subject to a number of customary conditions, including:

| | (a) | the closing of a research and licensing agreement whereby
      the Company will acquire an exclusive license to certain probiotic strains
      for the countries located in North and South America; and                              
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                         
| | (b) | the closing of an exclusive licensing agreement whereby
      the Company will acquire an exclusive license to certain health related
      products for the countries located in North and South America. (closed
      March 12, 2010)

Upon closing, the term of the Lab
Facilities and Service Agreement will be until September 30, 2013 and either
party may terminate the Lab Facilities and Service Agreement if there is a
material breach of the Lab Facilities and Service Agreement by the other
party.

F-16

---

|CALECO PHARMA CORP.                           
|----------------------------------------------
|(formerly Blackstone Lake Minerals Inc.)      
|(A Development Stage Company)                 
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
|(Expressed in U.S. Dollars)                   
|July 31, 2010                                 
|(Unaudited)                                   
|                                              

|11. | TECHNOLOGY PURCHASE AGREEMENT                                                                                                                                                                                                                                                                                                                                                                                  
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                
|    | On January 27, 2009, pursuant to a technology purchase
      agreement, the Companys former subsidiary, Caleco- Sub, acquired a
      proprietary technology and the intellectual property related thereto for
      the treatment of liver disease and other ailments, particularly resulting
      from viral infections such as the Hepatitis C virus infection (the
      Technology) from NY Financial.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                
|    | As consideration for the Technology, the Company and
      Caleco-Sub agreed to:                                                                                                                                                                                                                                                                                                                               
|    |                                                                                                                                                                                                                                                                                                                                                                                                                
|    | (1)                                                                                                                                                                                                                                                                                                                                                                                                            
|    |                                                                                                                                                                                                                                                                                                                                                                                                                
|    | (2)                                                                                                                                                                                                                                                                                                                                                                                                            

As further consideration, an officer
and director of the Company transferred 32,000,000 shares of the Companys
common stock to NY Financial on closing.

Caleco-Sub has also agreed to reimburse
the documented costs related to the Technology totaling Euro 432,000 (US
$581,270) and $66,500. As at July 31, 2010, the Company has paid Euro 265,311
(US $356,985) and $18,250 in cash, has issued promissory notes for accounts
payable totaling Euro 112,000 (US $150,700) and has issued 300,000 shares of its
common stock at $0.10 per share for settlement of accounts payable with an
aggregate value totaling $30,000. One loan of Euro 56,000 (US $75,350) was due
February 1, 2010 and has not been paid. The second loan of Euro 56,000 (US
$75,350) was due June 1, 2010 and has not been paid.

|12. | LICENSE AGREEMENTS                                                                                                                                                                                                                                                                                                                                       
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                          
|    | Europe License Agreement                                                                                                                                                                                                                                                                                                                                 
|    |                                                                                                                                                                                                                                                                                                                                                          
|    | On November 1, 2009, the Company entered into a license
      agreement (the Europe License Agreement) with Caleco Pharma Europe S.L.
      (SL), a Spanish Corporation, whereby the Company granted SL an exclusive
      license in the European Continent to market and exploit certain products
      the Company has developed or is developing.
|    |                                                                                                                                                                                                                                                                                                                                                          
|    | In consideration of the grant of the exclusive license,
      SL has agreed to pay and issue the following:                                                                                                                                                                                                                                              
|    |                                                                                                                                                                                                                                                                                                                                                          
|    | (a)                                                                                                                                                                                                                                                                                                                                                      

F-17

---

|CALECO PHARMA CORP.                           
|----------------------------------------------
|(formerly Blackstone Lake Minerals Inc.)      
|(A Development Stage Company)                 
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
|(Expressed in U.S. Dollars)                   
|July 31, 2010                                 
|(Unaudited)                                   
|                                              

|12. | LICENSE AGREEMENTS (continued)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|    | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|    | The term of the exclusive license is for a period of
        twenty years. The Company may terminate the Europe License Agreement if SL
        does not achieve the following annual gross revenues: (i) $3,000,000 from
        the sale of the Products during the period of July 31, 2012 to July 30,
        2013; (ii) $5,000,000 from the sale of the Products during the period of
        July 31, 2013 to July 30, 2014; and (iii) $12,000,000 from the sale of the
        Products during the period of July 31, 2014 to July 30,
    2015.

Natac License Agreement

On March 12, 2010, the Company entered
into an exclusive license agreement (the License Agreement) with Natac whereby
Natac has granted the Company the exclusive right to develop, commercialize,
market and distribute five compounds (AOF, AH-FLO, JHF, HGF, NBVAL40) derived
from plant extracts throughout North and South America.

In consideration of the exclusive
license, the Company has agreed to pay a royalty of five percent (5%) of the net
sales of the compounds in North and South America. Under the terms of the
License Agreement, the Company is also required to:

| | (a) | purchase the products from Natac in accordance with the
      terms of the License Agreement;                                                                    
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                  
| | (b) | complete its first commercial sale of the products by
      March 31, 2011;                                                                                      
| |     |                                                                                                                                                                  
| | (c) | purchase a minimum of 300,000 units, each unit being 10
      grams, of the products from Natac by December 31, 2011; and                                        
| |     |                                                                                                                                                                  
| | (d) | within one year of entering into the License Agreement,
      complete a clinical trial(s) for the purpose of supporting the
      effectiveness of the products.

The Company has the right to
sub-license the five compounds in North and South America and the right to
assign the entire interest in the License Agreement subject to the following:

| | (a) | if the assignment is for cash consideration only, the
      Company will be entitled to retain 90% of the cash payment and Natac will
      be entitled to 10% of the cash payment; and                                           
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                   
| | (b) | if the assignment is for a combination of a cash payment
      and royalties, the Company will be entitled to retain 90% of the cash
      payment and royalty with 10% of the cash payment and royalty being paid to
      Natac.

The term of the License Agreement is
for a period of twenty years.

F-18

---

|CALECO PHARMA CORP.                           
|----------------------------------------------
|(formerly Blackstone Lake Minerals Inc.)      
|(A Development Stage Company)                 
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
|(Expressed in U.S. Dollars)                   
|July 31, 2010                                 
|(Unaudited)                                   
|                                              

|13. | SUPPLEMENTAL DISCLOSURE WITH RESPECT TO CASH
      FLOWS
|--- | --------------------------------------------------------

| |                |   |                    |  |   |          |  |   |          | 
| | -------------- | - | ------------------ |  | - | -------- |  | - | -------- | 
| |                |   | Cumulative         |  |   |          |  |   |          | 
| |                |   | Amounts from       |  |   |          |  |   |          | 
| |                |   | October 19, 2007   |  |   | Nine     |  |   | Nine     | 
| |                |   | (start of the      |  |   | Months   |  |   | Months   | 
| |                |   | development stage) |  |   | Ended    |  |   | Ended    | 
| |                |   | to July 31,        |  |   | July 31, |  |   | July 31, | 
| |                |   | 2010               |  |   | 2010     |  |   | 2009     | 
| |                |   |                    |  |   |          |  |   |          | 
| | Cash paid for: |   |                    |  |   |          |  |   |          | 
| | Interest       | $ | 59,064             |  | $ | 35,354   |  | $ | -        | 
| | Income taxes   | $ | -                  |  | $ | -        |  | $ | -        | 
| |                |   |                    |  |   |          |  |   |          | 

Non-cash Transactions

Investing and financing activities that
do not have an impact on current cash flows are excluded from the statement of
cash flows.

During the nine months ended July 31,
2010, $21,000 in accounts payable was settled by the issuance of 210,000 shares
of the Companys common stock.

During the six months ended July 31,
2010, $15,000 in loans payable was settled by the issuance of 150,000 shares of
the Companys common stock.

|14. | SUBSEQUENT EVENTS                                                                                                                                                                                                                                                                                                                                                   
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                     
|    | On August 16, 2010, the Company entered into a consulting
      agreement with CityVac whereby CityVac agreed to provide the Company with
      investor relations services. In consideration of these services, the
      Company issued 625,000 shares of the Companys common stock (issued August
      16, 2010). The contract terminates on December 16, 2010.
|    |                                                                                                                                                                                                                                                                                                                                                                     
|    | On September 8, 2010, the Company issued 1,500,000 shares
      of its common stock at $0.06 per share for settlement of outstanding
      indebtedness totaling $90,000.                                                                                                                                                                                           
|    |                                                                                                                                                                                                                                                                                                                                                                     
|    | On September 10, 2010, a loan was granted from a third
      party company totaling $14,000. The loan bears interest at 10% per annum
      and is due on demand.                                                                                                                                                                                                   

F-19

---

|ITEM 2. | MANAGEMENT'S DISCUSSION
      AND ANALYSIS OF FINANCIAL CONDITION
      AND RESULTS OF OPERATIONS.
|------- | --------------------------------------------------------------------------------------------------

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

Certain statements contained in this Quarterly Report
constitute "forward-looking statements. These statements, identified by words
such as plan, anticipate, believe, estimate, should, expect and
similar expressions include our expectations and objectives regarding our future
financial position, operating results and business strategy. These statements
reflect the current views of management with respect to future events and are
subject to risks, uncertainties and other factors that may cause our actual
results, performance or achievements, or industry results, to be materially
different from those described in the forward-looking statements. Such risks and
uncertainties include those set forth under the caption "Part II  Item 1A. Risk
Factors" and elsewhere in this Quarterly Report. We advise you to carefully
review the reports and documents, particularly our Annual Reports, Quarterly
Reports and Current Reports, that we file from time to time with the United
States Securities and Exchange Commission (the SEC).

CORPORATE OVERVIEW

We were incorporated on May 18, 2004 under the laws of the
State of Nevada.

We are a company engaged in the acquisition and development of
over-the-counter medication and Food and Drug Administration (FDA) approved
pharmaceuticals. We currently own a proprietary technology designed to benefit
people suffering from moderate to severe liver maladies, such as elevated liver
enzymes and Hepatitis C viral infection, by lowering liver enzymes and reducing
viral loads (the Liver Health Formula). We have developed or are in the
process of developing food supplements, hair and dermatological products, energy
drinks and chewing gum that derive their formulations from our Liver Health
Formula. These products are being developed to provide enhancement to an
individual's immune system. The details of our Liver Health Formula and our
products are set out below under the heading Principal Products."

We also acquired an exclusive license from Natac Biotech S.L.
(Natac), a Spanish biotechnology corporation, to develop, commercialize,
market and distribute five compounds (AOF, AH-FLO, JHF, HGF, NB-VAL40) derived
from plant extracts throughout North and South America. The details of the
license agreement with Natac are set out below under the heading Principal
Products  Natac and Health Related Products.

RECENT CORPORATE DEVELOPMENTS

We experienced the following corporate developments since the
filing of our Form 10-Q for the fiscal quarter ended April 30, 2010 on June 14,
2010:

|1. | On August 12, 2010, we entered into a Public Relations,
      Promotion and Marketing Letter Agreement (the Consulting Agreement) with
      Mary Kratka d/b/a CityVac (CityVac) whereby we engaged CityVac to
      provide various investor relations services to us from August 16, 2010 to
      December 16, 2010. Under the terms of the Consulting Agreement, we issued
      to CityVac 625,000 shares of our common stock in consideration for the
      services to be provided by CityVac. The shares were issued pursuant to
      Rule 506 of Regulation D of the Securities Act of 1933 (the Securities
      Act). CityVac represented that it was an accredited investor as defined
      in Rule 501 of Regulation D.
|-- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|2. | On September 8, 2010, we issued 1,500,000 shares of our
      common stock at a price of $0.06 per share to settle outstanding
      indebtedness of $90,000 pursuant to Regulation S of the Securitas Act. The
      subscribers represented that they were not U.S. Persons as defined in
      Regulation S.                                                                                                                                                                                                                                                                                                                                                                                                                           
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|3. | On September 10, 2010, we received a loan of $14,000 from
      a third party company. The loan bears interest at a rate of 10% per annum
      and is due on demand.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       

3

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PRINCIPAL PRODUCTS

Liver Heath Formula

We acquired the Liver Health Formula pursuant to the terms and
conditions of a technology purchase agreement dated December 19, 2008 (the
Technology Purchase Agreement) among NY Financial (International) Corp. (NY
Financial), the Company, Caleco Pharma Corp., formerly our wholly owned
subsidiary, and John Boschert, our sole executive officer and a director. Under
the terms of the Technology Purchase Agreement, NY Financial assigned and
transferred the Liver Health Formula to us in consideration of which we:

|(a) | paid $22,500 in cash to NY Financial; and                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|(b) | issued a non-interest bearing promissory note in the
      amount of $77,500 to NY Financial at closing. This amount was payable on
      January 31, 2009. On January 31, 2009, we became in default of the
      promissory note as we were unable to pay the $77,500. Under the terms of
      the promissory note, the unpaid portion of the promissory note, being
      $71,500, would bear interest at 10% per annum commencing on January 31,
      2009. During the year ended October 31, 2009, an additional $68,159 was
      repaid.

As further consideration, Mr. Boschert transferred 32,000,000
shares of our common stock held by him to NY Financial, which resulted in a
change in control. We also appointed F. Javier Benedi Garcia, the sole director
of NY Financial, to our Board of Directors.

Following closing, we agreed to reimburse the documented costs
related to the recording of the patent applications and the filing of the
European Drug Master File applications, which amount is not to exceed 590,000
EUR. Subsequent to the entry into the Technology Purchase Agreement, we
determined that the reimbursable expenses amounted to 432,000 Euros (US
$581,270) and $66,500. As at July 31, 2010, the Company has paid 265,311 Euros
(US $356,985) and $18,250 in cash, has issued promissory notes for accounts
payable totaling 112,000 Euros (US $150,700) and has issued 300,000 shares of
its common stock at $0.10 per share for settlement of accounts payable with an
aggregate value totaling $30,000. One loan of 56,000 Euros (US $75,350) was due
February 1, 2010 and has not been paid. The second loan of 56,000 Euros (US
$75,350) was due June 1, 2010 and has not been paid. In addition, the parties
also agreed that:

|(a) | we will use our best efforts to raise financing of
      $2,500,000. In connection with this financing, we have agreed that we will
      not issue more than 20,000,000 shares of our common stock unless we obtain
      NY Financials consent; and
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                       
|(b) | we are restricted from assigning or transferring the
      Liver Health Formula until January 1, 2011. Notwithstanding this
      restriction, we will have the right to license the Liver Health
      Formula.                                      

Our Liver Health Formula is designed to benefit people
suffering from moderate to severe liver maladies, such as elevated liver enzymes
and Hepatitis C viral infection, by lowering liver enzymes and reducing viral
loads (which are a measure of the severity of a viral infection). To date, we
have filed patent applications in the United States, Canada and Europe and
obtained four European Drug Master File applications which will allow us to
market our Liver Health Formula in Europe, while protecting the confidential
material of our intellectual property. Our ability to further develop,
market and manufacture our Liver Health Formula as an over-the-counter product
or an FDA approved pharmaceutical is subject to our obtaining substantial
financing, of which there is no assurance.

Using the formulations of our Liver Health Formula, we have
developed or are in the process of developing food supplements, hair and
dermatological products, energy drinks and chewing gum. These products are being
designed to provide enhancement to an individual's immune system. A description
of the products is set out below.

4

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Product
      Group
    Name of Products
    Description of ProductsFood Supplements
    Lamiridosin
    A dietary
      supplement that we are in the process of developing and designed to
      enhance an individual's immune system.Natural Hair Care Products
    Lamiri Shampoo, LamiriHair
      Conditioner and Lamiri Hair Tonic
    Hair care products that promote
      healthy scalp and hair.Natural Skin Care Products
    LamiriGel and
      LamiriCreme
    Skincare products
      that promote healthy skin.Energy Drinks
    KTKin
    An energy drink designed to
      enhance an individual's immune system.Chewing Gum
    KTK Chewing Gum
      and KTKids Children Chewing Gum
    Chewing gum
      designed to enhance an individual's immune system.


Engagement of Cosmetic Project Management

In connection with the development of our products, we engaged
Cosmetic Project Management, a Spanish corporation engaged in the business of
the formulating, developing and commercializing cosmetic products, to assist us
in formulating, developing and commercializing our Natural Hair Care Products
and Natural Skin Care Products. In particular, Cosmetic Project Management has
agreed to do the following:

|(a) | produce samples for each of our Natural Hair Care
      Products and Natural Skin Care Products;                                        
|--- | ----------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                         
|(b) | provide us with a feasibility study on our Natural Hair
      Care Products and Natural Skin Care Products;                             
|    |                                                                                                                                         
|(c) | design product packaging and develop an advertising plan
      for our Natural Hair Care Products and Natural Skin Care
  Products;     
|    |                                                                                                                                         
|(d) | assist us in selecting a manufacturer in order to ensure
      good manufacturing practice guidelines are met; and                      
|    |                                                                                                                                         
|(e) | assist us in preparing and filing a product dossier for
      each of our Natural Hair Care Products and Natural Skin Care
    Products.

In consideration for these services, we paid EUR 20,100
(approximately $27,050) to Cosmetic Project Management.

We anticipate that we will use the samples of our Natural Hair
Care Products and Natural Skin Care Products for clinical studies purposes.
These clinical studies will assist us in determining whether there are any
dermatological health benefits for hair and skin through the use of our Natural
Hair Care Products and Natural Skin Care Products.

Grant of European License to Caleco Pharma Europe S.L.

On November 1, 2009, we entered into a license agreement (the
Europe License Agreement) with Caleco Pharma Europe S.L. (SL), a Spanish
corporation, whereby we granted SL an exclusive license to market and exploit in
the European continent certain products we have developed or are developing.
These products include Lamiridosin, LamiriShampoo, LamiriHair Conditioner,
LarimiHair Tonic, LamiriGel, LamiriCreme, KTKin, KTK Chewing Gum and KTKids
Children Chewing Gum (collectively, the Licensed Products). In consideration
of the grant of the exclusive license, SL issued and granted to us:

|(a) | such number of shares of SL that equals 10% of SLs
      outstanding share capital (the SL Shares). Our 10% interest in the share
      capital of SL is non-dilutive as long as SLs outstanding share capital is
      1,000,000 Euros or less. If SLs share capital is above 1,000,000 Euros
      and it offers to issue additional shares, we will have a right to purchase
      10% of the offered shares; and
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

5

---

|(b) | a royalty of five percent (5%) of its gross sales of the
      Licensed Products.
|--- | ---------------------------------------------------------------------------------

In addition to SLs exclusive license, SL will have the right
to sub-license the Licensed Products in the European continent. Each party will
also have the right to assign its entire interest in the Europe License
Agreement subject to the mutual agreement of the parties. Any refusal by the
parties will not be considered reasonable if the transaction that is the subject
of the refusal is in accordance with internationally accepted standards for the
licensing of products.

Under the Europe License Agreement, we have the right to select
the manufacturer to manufacture the Licensed Products in the European continent.
Once a manufacturer has been selected by us, SL will be responsible for all
payments to the manufacturer.

The term of the exclusive license is for a period of twenty
(20) years. We may terminate the Europe License Agreement if SL does not achieve
the following annual gross revenues from the sale of the Licensed Products:

|(a) | $3,000,000 during the period of July 31, 2012 to July 30,
      2013;    
|--- | -------------------------------------------------------------------------
|(b) | $5,000,000 during the period of July 31, 2013 to July 30,
      2014; and
|(c) | $12,000,000 during the period of July 31, 2014 to July
      30, 2015.   

Under the Europe License Agreement, SL was required to provide
a development plan for the development of the Licensed Products. As of the date
of this Quarterly Report, we have yet to receive an acceptable development plan
and are currently in discussions with SL to resolve this matter.

Natac and Health Related Products

License Agreement  Health Related Compounds

On March 12, 2010, we entered into an exclusive license
agreement (the License Agreement) with Natac whereby Natac has granted us the
exclusive right to develop, commercialize, market and distribute five compounds
(AOF, AH-FLO, JHF, HGF, NBVAL40) derived from plant extracts throughout North
and South America.

In consideration of the exclusive license, we have agreed to
pay a royalty of five percent (5%) of the net sales of the compounds in North
and South America. Under the terms of the License Agreement, we are also
required to:

|(a) | purchase the products from Natac in accordance
      with the terms of the License Agreement;                                                                    
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                  
|(b) | complete our first commercial sale of the
      products by March 31, 2011;                                                                                      
|    |                                                                                                                                                                  
|(c) | purchase a minimum of 300,000 units, each unit
      being 10 grams, of the products from Natac by December 31, 2011; and                                        
|    |                                                                                                                                                                  
|(d) | within one year of entering into the License
      Agreement, complete a clinical trial(s) for the purpose of supporting the
      effectiveness of the products.

The License Agreement also provides that we will have the right
to sub-license the five compounds in North and South America. We will also have
the right to assign our entire interest in the License Agreement subject to the
following:

|(a) | if the assignment is for cash consideration only, we will
      be entitled to retain 90% of the cash payment and Natac will be entitled
      to 10% of the cash payment; and                                         
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                        
|(b) | if the assignment is for a combination of a cash payment
      and royalties, we will be entitled to retain 90% of the cash payment and
      royalty with 10% of the cash payment and royalty being paid to
    Natac.

The term of the License Agreement is for a period of twenty
years.

6

---

Share Purchase Agreement

On February 10, 2010, we entered into a share purchase
agreement, as amended on March 19, 2010 and April 26, 2010, (the Share Purchase
Agreement) with Natac and the Principal Stockholders. Under the terms of the
Share Purchase Agreement, we agreed to acquire eighteen percent (18%) of the
share capital of Natac from the Principal Stockholders (the Natac Shares). In
consideration of the Natac Shares, we agreed to issue an aggregate of 4,300,000
shares of our common stock to the Principal Stockholders.

The closing of the Share Purchase Agreement was expected to
occur on or before July 19, 2010 and is subject to a number of customary
conditions, including:

|(a) | the closing of a research and licensing agreement whereby
      we will acquire an exclusive license to certain probiotic strains for the
      countries located in North and South America;        
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                      
|(b) | the closing of an exclusive licensing agreement whereby
      we will acquire an exclusive license to certain health related products
      for the countries located in North and South America; and
|    |                                                                                                                                                                                                      
|(c) | the closing of a lab facilities and services agreement
      whereby Natac shall provide certain services and laboratory access to
      us.                                                         

Following closing of the Share Purchase Agreement, Natac has
agreed to appoint a nominee of the Company to the Board of Directors of Natac.
In addition, we have also agreed to appoint a nominee of Natac to our Board of
Directors.

We did not complete the closing of the Share Purchase
Agreement. We are currently in the process of negotiating an extension to the
Share Purchase Agreement with Natac. There is no assurance that we will complete
our acquisition of the Natac Shares.

Lab Facilities and Service Agreement

On February 18, 2010, we entered into a lab facilities and
service agreement, as amended on March 19, 2010, April 26, 2010 and June 11,
2010, (the Lab Facilities and Service Agreement) with Natac whereby we will
have access to Natacs laboratory facility and procure certain laboratory
services from Natac in consideration of the following:

|(a) | 20,000 Euros (approximately $27,716) (which amount has
      been paid on February 10, 2010);                                                                                                                          
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                        
|(b) | issuance of a promissory note in the amount of 130,000
      Euros (approximately $169,536) which is payable on or before September 10,
      2010 (of which 11,625 Euros ($15,161) has been paid on May 10,
    2010);
|    |                                                                                                                                                                                                                        
|(c) | 100,000 Euros (approximately $130,412) on or before each
      of September 30, 2010, December 31, 2010, March 31, 2011 and June 30,
      2011; and                                                                   
|    |                                                                                                                                                                                                                        
|(d) | 125,000 Euros (approximately $163,015) on or before each
      of:                                                                                                                                                     
|    |                                                                                                                                                                                                                        
|    | (i)                                                                                                                                                                                                                    
|    |                                                                                                                                                                                                                        
|    | (ii)                                                                                                                                                                                                                   

The closing of the Lab Facilities and Service Agreement was
expected to occur on or before September 10, 2010 and is subject to a number of
customary conditions, including:

|(a) | the closing of a research and licensing agreement whereby
      we will acquire an exclusive license to certain probiotic strains for the
      countries located in North and South America; and                                                     
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                       
|(b) | the closing of an exclusive licensing agreement whereby
      we will acquire an exclusive license to certain health related products
      for the countries located in North and South America (which exclusive
      license agreement has closed).

7

---

We did not complete the closing of the Lab Facilities and
Services Agreement. We are currently in the process of negotiating an extension
to the Lab Facilities and Services Agreement with Natac. There is no assurance
that we will be able to enter into an extension agreement for the Lab Facilities
and Services Agreement.

PLAN OF OPERATION

Over the next twelve months, our plan is to continue to develop
our over-the-counter pipeline of products and, if warranted, develop our Liver
Health Formula as an FDA approved pharmaceutical. We also plan to continue to
acquire and license additional products and technology to add to our current
product pipeline. In order to complete our plan of operation we will require
substantial financing of which there is no assurance.

|a) | Over-the-Counter Medication Development                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|-- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|   | Oral Supplement: We plan to develop, market and
      manufacture a formulation of our Liver Health Formula as an
      over-the-counter oral supplement. In developing the formulation of our
      Liver Health Formula, we plan to conduct a clinical trial in the second
      half of 2010. We anticipate that this formulation will be derived from our
      proprietary compound called HP-201. The HP-201 compound is designed to
      support liver health and provide general immune status benefits. We
      anticipate that the costs related to the development and marketing of the
      oral supplement will be $700,000 in 2010.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|   | Dermatologic Application: We also plan to initiate
      research, development and pre-commercial activities related to the HP-201
      over-the-counter franchise line extension formulations, including
      dermatologic applications. We anticipate that the costs related to the
      dermatological line will be $450,000 in 2010.                                                                                                                                                                                                                                                                                                         
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|b) | Pharmaceutical Development                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|   | HP-201 Compound: We plan to continue pre-clinical
      work related to the HP-201 prescription pharmaceutical pathway.
      Pre-clinical work will include the identification and synthetic structural
      modification of compounds derived from HP-201. We anticipate that the
      costs related to the HP-201 New Drug Application pathway will be $300,000
      in 2010.                                                                                                                                                                                                                                                                 
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|   | HP-202 Compound: We also plan to initiate
      pre-clinical work related to discover a second antiviral New Drug
      Application pipeline product referred to as HP-202. This pre-clinical work
      will include anti-viral and cytotoxicity assays. We anticipate that the
      costs related to the HP-202 New Drug Application pathway will be $200,000
      in 2010.                                                                                                                                                                                                                                                                     
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|c) | Product Pipeline                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|   | We plan to accelerate our in-licensing activities
      targeted at identifying new, over-the-counter and prescription product
      development candidates that are synergistic with our current product
      pipelines as well as our research, development and commercialization skill
      sets and overall business model. There is no assurance that we will
      identify and secure rights to license additional products in 2010. We
      anticipate that the costs related to identifying new product development
      opportunities will be $250,000 in 2010.                                                                       

In addition to the amounts described above, we anticipate that
we will require an additional $800,000 for general and administrative purposes,
including consulting fees in connection with the operation of our business and
legal and accounting fees in connection with meeting our ongoing reporting
obligations under the Securities Exchange Act of 1934 (the Exchange Act). As a
result, we anticipate that the costs of implementing our plan of operation and
meeting our ongoing operating costs will be $2,700,000. Accordingly, we will
require substantial financing in order to carry out our plan of operation and to
meet our operating costs over the next twelve months. There is no assurance that
we will be able to obtain financing in the amounts required to implement our
plan of operation or to meet our ongoing operating costs. If we are not
successful in raising sufficient financing, our business may fail and our
shareholders may lose all or part of their investment

8

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RESULTS OF OPERATIONS

Nine Months and Third Quarter Summary

|                 |   | Nine Months Ended July 31, |   |   | Three Months Ended July
      31, |  
|---------------- | - | -------------------------- | - | - | --------------------------------- | -
|                 |   |                            |   |   |                                   |  
|                 |   |                            |   |   |                                   |  
|                 |   | 2010                       |   |   | 2009                              |  
|                 |   |                            |   |   |                                   |  
|Revenue          | $ | -                          |   | $ | -                                 |  
|Expenses         |   | (791,779                   | ) |   | (412,865                          | )
|Interest Expense |   | (9,064                     | ) |   | (43,811                           | )
|Grant of License |   | (491                       | ) |   | -                                 |  
|Net Loss         | $ | (800,352                   | ) | $ | (456,676                          | )

Revenues

We have not earned any revenues since our inception and we do
not anticipate earning revenues in the foreseeable future. Our ability to earn
revenues in the future is dependent upon: (i) the development and manufacturing
of our Liver Health Formula as an over-the-counter medication; and (ii) the
development and manufacture of our naturally sourced products. There is no
assurance that we will be able to develop and manufacture our Liver Health
Formula as an over-the-counter medication, or we will be able to manufacture and
develop our naturally sourced products.

Expenses

|                                  |   | Nine Months Ended July 31, |   |   | Three Months Ended July
      31, | 
|--------------------------------- | - | -------------------------- | - | - | --------------------------------- | 
|                                  |   |                            |   |   |                                   | 
|                                  |   |                            |   |   |                                   | 
|                                  |   | 2010                       |   |   | 2009                              | 
|                                  |   |                            |   |   |                                   | 
|Management fees                   | $ | 70,500                     |   | $ | 22,500                            | 
|Professional fees                 |   | 589,752                    |   |   | 115,756                           | 
|Other operating      expenses     |   | 172,257                    |   |   | 214,212                           | 
|Foreign currency      loss (gain) |   | (40,730                    | ) |   | 60,397                            | 
|Total
      Expenses              | $ | 791,779                    |   | $ | 412,865                           | 

Three Months Ended July 31, 2010 and 2009

Our expenses increased from $109,382, during the three months
ended July 31, 2009, to $139,031, during the three months ended July 31, 2010.
The increase in our expenses is primarily attributable to substantial increases
in professional fees and management fees. These amounts were partially offset by
the recording of a foreign currency gain.

Management fees consisted of amounts incurred as compensation
to our officers and directors. The additional management fees during the three
months ended July 31, 2010 primarily relate to our recording of a stock based
compensation expense of $39,000 that was issued to our Chief Financial Officer.

Professional fees consisted of: (i) legal fees, accounting and
audit fees related to meeting our reporting requirements under the Exchange Act;
and (ii) consulting fees related to payments to consultants regarding product
development and investor relations activities. The additional professional fees
during three months ended July 31, 2010 are primarily related to product
development.

9

---

Other operating expenses primarily consisted of travel and
office expenses.

During the three months ended July 31, 2010, the increase in
foreign currency gain primarily relates to favorable exchange rates in
connection with our outstanding accounts payable and loans payable.

Nine Months Ended July 31, 2010 and 2009

Our expenses increased from $412,865, during the nine months
ended July 31, 2010, to $791,779, during the nine months ended July 31, 2009.
The increase in our expenses during the nine months ended July 31, 2010 is
primarily attributable to an increase in professional fees and management fees.
These amounts were partially offset by an increase in foreign currency gain and
a decrease in operating expenses.

Management fees include amounts paid as compensation to our
officers and directors. The additional management fees during the three months
ended July 31, 2010 primarily relate to our recording of a stock based
compensation expense of $39,000 that was issued to our Chief Financial Officer.

Professional fees consisted of: (i) legal fees related to our
proposed transactions with Natac and meeting our reporting requirements under
the Exchange Act; (ii) accounting and audit fees related to meeting our
reporting requirements under the Exchange Act; and (iii) consulting fees related
to payments to consultants regarding product development and investor relations
activities. The additional professional fees during the nine months ended July
31, 2010 are primarily a result of our proposed transactions with Natac and
consulting fees related to product development.

Other operating expenses primarily consisted of travel, office
and website development expenses.

During the nine months ended July 31, 2010, the increase in
foreign currency gain primarily relates to favorable exchange rates in
connection with our outstanding accounts payable and loans payable.

If we are able to obtain sufficient financing to undertake our
proposed business plan for our over-the-counter and pharmaceutical business, our
expenses are anticipated to increase significantly.

LIQUIDITY AND CAPITAL RESOURCES

Working Capital

|                        |   |                        |   |   |                           |   |  | Percentage            | 
|----------------------- | - | ---------------------- | - | - | ------------------------- | - |  | --------------------- | 
|                        |   | At
      July 31, 2010 |   |   | At
      October 31, 2009 |   |  | Increase / (Decrease) | 
|                        |   |                        |   |   |                           |   |  |                       | 
|Current Assets          | $ | 576                    |   | $ | 271,106                   |   |  | (99.8)%               | 
|Current Liabilities     |   | (916,068               | ) |   | (923,685                  | ) |  | (0.8)%                | 
|Working Capital Deficit | $ | (915,492               | ) | $ | (652,579                  | ) |  | 40.3%                 | 

Cash Flows

|                                        |   | Nine Months Ended July 31, |  
|--------------------------------------- | - | -------------------------- | -
|                                        |   | 2010                       |  
|                                        |   |                            |  
|Cash Flows used in Operating Activities | $ | (777,448                   | )
|Cash Flows used in Investing Activities |   | -                          |  
|Cash Flows from Financing Activities    |   | 506,918                    |  
|Net Decrease in Cash During Period      | $ | (270,530                   | )

Our working capital deficit increased from $652,579, as at
October 31, 2009, to $915,492, as at July 31, 2010. The increase in our working
capital deficit is due to: (i) a decrease in cash as a result of repayments of a
portion of our accounts payable; and (ii) the fact that we recorded a payable of
130,000 Euros to Natac pursuant to the Lab Facilities and Services Agreement.

10

---

During the nine months ended July 31, 2010, we completed the
following equity financings:

|(a) | we issued 4,235,930 shares of our common stock for cash
      proceeds of $413,593 and to settle outstanding indebtedness of $10,000
      under our Foreign Private Placement.                                                                     
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                     
|(b) | we issued 650,000 shares of our common stock for cash
      proceeds of $39,000 and to settle outstanding indebtedness of $26,000
      under our U.S. Private Placement.                                                                           
|    |                                                                                                                                                                                                                                                     
|(c) | we issued 300,000 shares of our common stock at a deemed
      price of $81,000 in exchange for consulting services.                                                                                                                                
|    |                                                                                                                                                                                                                                                     
|(d) | we issued 666,666 shares of our common stock for cash
      proceeds of $100,000 pursuant to Rule 506 of Regulation D of the
      Securities Act. The subscriber represented that it was an accredited
      investor as defined in Regulation D.
|    |                                                                                                                                                                                                                                                     
|(e) | we issued 300,000 shares of our common stock at a deemed
      price of $39,000 in exchange for consulting
services.                                                                                                                                

Future Financings

As at July 31, 2010, we had cash on hand of $576. Currently, we
do not have sufficient financial resources to complete our plan of operation for
the next twelve months. We have not earned any revenues to date and we do not
anticipate earning revenues in the near future. As such, our ability to complete
our plan of operation is dependent upon our ability to obtain substantial
financing in the near term. Any future financing that we obtain is expected to
be in the form of sales of our equity securities. If we are successful in
completing any equity financings, of which there is no assurance, our existing
shareholders will experience a dilution of their interest in our company. There
is a substantial doubt that we will be able to obtain financing in an amount
that is sufficient to enable us to complete our proposed plan of operation. If
we are not successful in raising sufficient financing, we will not be able to
complete our plan of operation. We do not have any specific alternatives to our
current plan of operation and have not planned for any such contingency. If we
are not successful in raising sufficient financing, our business may fail and
our shareholders may lose all or part of their investment.

OFF-BALANCE SHEET ARRANGEMENTS

We have no significant off-balance sheet arrangements that have
or are reasonably likely to have a current or future effect on our financial
condition, changes in financial condition, revenues or expenses, results of
operations, liquidity, capital expenditures or capital resources.

CRITICAL ACCOUNTING POLICIES

The preparation of financial statements in conformity with
generally accepted accounting principles requires our management to make
estimates and assumptions that affect the reported amount 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.
Our management routinely makes judgments and estimates about the effects of
matters that are inherently uncertain.

Our significant accounting policies are described in Note 3 to
our interim financial statements for the period ended July 31, 2010 included in
this Quarterly Report on Form 10-Q.

11

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|ITEM 3. | QUANTITATIVE AND QUALITATIVE DISCLOSURES
      ABOUT MARKET RISK
|------- | ----------------------------------------------------------------

Not Applicable.

|ITEM 4T. | CONTROLS AND PROCEDURES.
|-------- | ------------------------

We carried out an evaluation of the effectiveness of our
disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e)
and 15d-15(e)) as of July 31, 2010 (the Evaluation Date). This evaluation was
carried out under the supervision and with the participation of our Chief
Executive Officer and Chief Financial Officer. Based upon that evaluation, our
Chief Executive Officer and Chief Financial Officer concluded that our
disclosure controls and procedures were not effective as of the Evaluation Date
as a result of the material weaknesses in internal control over financial
reporting discussed in our Annual Report on Form 10-K for our year ended October
31, 2009 (the 2009 Annual Report).

Disclosure controls and procedures are those controls and
procedures that are designed to ensure that information required to be disclosed
in our reports filed or submitted under the Exchange Act are recorded,
processed, summarized and reported within the time periods specified in the
SECs rules and forms. Disclosure controls and procedures include, without
limitation, controls and procedures designed to ensure that information required
to be disclosed in our reports filed under the Exchange Act is accumulated and
communicated to management, including our Chief Executive Officer and Chief
Financial Officer, to allow timely decisions regarding required disclosure.

Notwithstanding the assessment that our internal control over
financial reporting was not effective and that there were material weaknesses as
identified in our 2009 Annual Report, we believe that our financial statements
contained in our Quarterly Report on Form 10-Q for the quarter ended July 31,
2010 fairly present our financial condition, results of operations and cash
flows in all material respects.

Changes in Internal Control Over Financial Reporting

There were no changes in our internal control over financial
reporting that occurred during the quarter ended July 31, 2010 that have
materially affected, or that are reasonably likely to materially affect, our
internal control over financial reporting.

12

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PART II  OTHER INFORMATION

|ITEM 1. | LEGAL PROCEEDINGS.
|------- | ------------------

None.

|ITEM 1A. | RISK FACTORS.
|-------- | -------------

The following are some of the important factors that could
affect our financial performance or could cause actual results to differ
materially from estimates contained in our forward-looking statements. We may
encounter risks in addition to those described below. Additional risks and
uncertainties not currently known to us, or that we currently deem to be
immaterial, may also impair or adversely affect our business, financial
condition or results of operation.

We require additional financing.

To date our operations have not been profitable. We have not
earned any revenues to date and there is no assurance that we will be able to do
so in the near future. In addition, there is no assurance that our ongoing
expenditures will exceed our estimates over the next twelve months. We may never
be able to achieve profitability.

We do not currently have the financial resources to complete
our plan of operation for the next twelve months. We anticipate that we will
require substantial financing over the next twelve months in order to complete
our business plan. However, there is no assurance that we will be able to obtain
additional financing. If further financing is not available or obtainable, our
ability to meet our financial obligations and pursue our plan of operation will
be substantially limited and investors may lose a substantial portion or all of
their investment.

Our inability to complete our product development activities
successfully may severely limit our ability to operate and finance
operations.

The development of our technology as an over-the-counter
medication and a FDA approved pharmaceutical will require significant financing
and additional research and development as well as substantial clinical trials.
We believe that the United States, Europe and Canada will be the principal
markets for our technology, as will any country in the world where the need for
the treatment of liver diseases, including the Hepatitis C virus, exists. We may
not be able to successfully complete development of our technology, or
successfully market our technology. We, and any of our potential collaborators,
may encounter problems and delays relating to research and development,
regulatory approval and intellectual property rights of our technology. Our
research and development programs may not be successful. Our technology may not
prove to be safe and efficacious in clinical trials, and we may not obtain the
intended regulatory approvals for our technology. Whether or not any of these
events occur, we may not have adequate resources to continue operations for the
period required to resolve the issue delaying development and we may not be able
to raise capital to finance our operation during the period required for
resolution of that issue.

We may lose our competitiveness if we are not able to
protect our proprietary technology and intellectual property rights against
infringement, and any related litigation may be time-consuming and costly.

Our success and ability to compete depends to a significant
degree on our proprietary technology. If any of our competitors copy or
otherwise gain access to our proprietary technology or develop similar
technologies independently, we may not be able to compete as effectively. The
measures we have implemented to protect our proprietary technology and other
intellectual property rights are currently based upon patent applications filed
in the United States, Europe and Canada and European Drug Master File
applications. This, however, may not be adequate to prevent the unauthorized use
of our proprietary technology and our other intellectual property rights.
Further, the laws of foreign countries may provide inadequate protection of such
intellectual property rights. We may need to bring legal claims to enforce or
protect such intellectual property rights. Any litigation, whether successful or
unsuccessful, may result in substantial costs and a diversion of our company's
resources. In addition, notwithstanding our rights to our intellectual property,
other persons may bring claims against us alleging that we have infringed on
their intellectual property rights or claims that our intellectual property
rights are not valid. Any claims against us, with or without merit,
could be time consuming and costly to defend or litigate, divert our attention
and resources, result in the loss of goodwill associated with our business or
require us to make changes to our technology.

13

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We may become subject to intellectual property litigation
which may harm our business.

Our success depends in part on our ability to develop
commercially viable products without infringing the proprietary rights of
others. Although we have not been subject to any filed infringement claims,
other patents or patent applications could exist or could be filed which may
prohibit or limit our ability to market our products or maintain a competitive
position. In the event of an intellectual property dispute, we may be forced to
litigate. Intellectual property litigation may divert management's attention
from developing our technology and may force us to incur substantial costs
regardless of whether we are successful. An adverse outcome could subject us to
significant liabilities to third parties, and force us to curtail or cease the
development and commercialization of our technology.

If we commercialize or test our technology, we will be
subject to potential product liability claims which may affect our financial
condition.

We face an inherent business risk of exposure to product
liability claims in the event that the use of our technology during research and
development efforts, including clinical trials, or after commercialization,
results in adverse affects. As a result, we may incur significant product
liability exposure, which may exceed any insurance coverage that we obtain in
the future. Even if we elect to purchase such issuance in the future, we may not
be able to maintain adequate levels of insurance at reasonable cost and/or
reasonable terms. Excessive insurance costs or uninsured claims may increase our
operating loss and affect our financial condition.

If we fail to effectively manage the growth of our company
and the commercialization or licensing of our technology, our future business
results could be harmed and our managerial and operational resources may be
strained.

As we proceed with the development of our technology and the
expansion of our marketing and commercialization efforts, we expect to
experience significant growth in the scope and complexity of our business. We
will need to add staff to manage operations, handle business development efforts
and perform finance and accounting functions. We anticipate that we will be
required to hire a broad range of additional personnel in order to successfully
advance our operations. This growth is likely to place a strain on our
management and operational resources. The failure to develop and implement
effective systems, or to hire and retain sufficient personnel for the
performance of all of the functions necessary to effectively service and manage
our potential business, or the failure to manage growth effectively, could have
a material adverse effect on our business and financial condition.

Failure to obtain and maintain required regulatory approvals
will severely limit our ability to commercialize our technology.

We will need to obtain the approval of the FDA before we
commence commercialization of our technology as a pharmaceutical in the United
States. We may also be required to obtain additional approvals from foreign
regulatory authorities to apply for any sales activities we may carry out in
those jurisdictions. If we cannot demonstrate the safety, reliability and
efficacy of our technology, the FDA or other regulatory authorities could delay
or withhold regulatory approval of our technology.

Even if we obtain regulatory approval of our technology, that
approval may be subject to limitations on the indicated uses for which it may be
marketed. Even after granting regulatory approval, the FDA and other regulatory
agencies and governments in other countries will continue to review and inspect
any future marketed products as well as any manufacturing facilities that we may
establish in the future. Later discovery of previously unknown problems with a
product or facility may result in restrictions on the product, including a
withdrawal of the product from the market. Further, governmental regulatory
agencies may establish additional regulations which could prevent or delay
regulatory approval of our technology.

14

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Even if we obtain regulatory approval to commercialize our products, lack of commercial acceptance may impair our business.

Our product development efforts are primarily directed toward obtaining regulatory approval for our liver disease product treatments. Our products may not be employed in all potential applications being investigated, and any reduction in
applications may limit the market acceptance of our products and our potential revenues. As a result, even if our products are developed into marketable products and we obtain all required regulatory approvals, we cannot be certain that our products
will be adopted at a level that would allow us to operate profitably.

If we do not keep pace with our competitors, technological advancements and market changes, our technology may become obsolete and our business may suffer.

The market for our technology is very competitive, is subject to rapid technological changes and varies for different individual products. We believe that there are potentially many competitive approaches being pursued that compete with our
technology, including some by private companies for which information is difficult to obtain.

Many of our competitors have significantly greater resources and have developed products and processes that directly compete with our technology. Our competitors may develop, or may in the future develop, new technologies that directly compete with
our technology or even render our technology obsolete. Our technology is designed to benefit people suffering from moderate to severe liver maladies, such as elevated liver enzymes and the Hepatitis C viral infection. Even if we are able to
demonstrate improved or equivalent results from our technology, researchers and practitioners may not use our technology and we may suffer a competitive disadvantage. Finally, to the extent that others develop new technologies that address the
targeted application for our current technology, our business will suffer.

If we are unable to hire and retain key personnel, then we may not be able to implement our business plan.

We depend on the services of our senior management and key technical personnel. In particular, our future success will depend on the continued efforts of John Boschert, an executive officer and a member of our Board of Directors, Luc Vanhal, our
Chief Financial Officer, James Sandino, a member of our Board of Directors, and F. Javier Benedi Garcia, a member of our Board of Directors. We also rely on consulting from Jim Metropoulos. The loss of the services of any of the gentlemen mentioned
above and the further erosion of staff could have an adverse effect on our business, financial condition and results of operations.

The quotation price of our common stock may be volatile, with the result that an investor may not be able to sell any shares acquired at a price equal to or greater than the price paid by the investor.

Our common shares are quoted on the OTC Bulletin Board. Companies quoted on the OTC Bulletin Board have traditionally experienced extreme price and volume fluctuations. In addition, our stock price may be adversely affected by factors that are
unrelated or disproportionate to our operating performance. Market fluctuations, as well as general economic, political and market conditions such as recessions, interest rates or international currency fluctuations may adversely affect the market
price of our common stock. In addition, to date, the trading volume for our shares on the OTC Bulletin Board has been limited. As a result of this potential volatility and potential lack of a trading market, an investor may not be able to sell any
of our common stock that they acquire that a price equal or greater than the price paid by the investor.

We may conduct further offerings of our equity securities in the future, in which case your shareholdings will be diluted.

Since our inception, we have been reliant upon sales of our common stock to fund our operations. We may conduct further equity offerings in the future to finance our current projects or to finance subsequent projects that we decide to undertake. If
common stock is issued in return for additional funds, the price per share could be lower than that paid by our current stockholders. We anticipate continuing to rely on equity sales of our common stock in order to fund our business operations. If
we issue additional stock, investors' percentage interest in us will be diluted.

15

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|ITEM 2. | UNREGISTERED SALES OF EQUITY SECURITIES
|------- | ---------------------------------------

On August 16, 2010, we issued 625,000 shares of our common
stock in accordance with the terms of a consulting agreement. The shares were
issued pursuant to Rule 506 of Regulation D of the Securities Act. The
subscriber represented that it was an Accredited Investor as defined in
Regulation D.

On September 8, 2010, we issued 1,500,000 shares of our common
stock at a price of $0.06 per share to settle outstanding indebtedness of
$90,000 pursuant to Regulation S of the Securitas Act. The subscribers
represented that they were not U.S. Persons as defined in Regulation S.

|ITEM 3. | DEFAULTS UPON SENIOR SECURITIES.
|------- | --------------------------------

None.

|ITEM 5. | OTHER INFORMATION.
|------- | ------------------

None.

|ITEM 6. | EXHIBITS.
|------- | ---------

|Exhibit |                                                                                                                                                                                               
|------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Number  | Description of Exhibits                                                                                                                                                                       
|2.1     | Agreement and Plan of Merger
      dated July 24, 2009 between the Company (as parent surviving company) and
      Caleco Pharma Corp. (as subsidiary merging entity).(20)                    
|3.1     | Articles of Incorporation.(1)                                                                                                                                                                 
|3.2     | Certificate of Change 
      13-for-1 Stock Split effective September 30, 2005.(7)                                                                                                           
|3.3     | Certificate of Amendment to Articles  Name
      Change from Triton Resources, Inc. to Skyflyer Inc. effective October 17,
      2006.(7)                                                    
|3.4     | Certificate of Amendment to
      Articles of Incorporation  Name Change from Skyflyer Inc. to Blackstone
      Lake Minerals Inc. effective January 23, 2008.(10)                           
|3.5     | Certificate of Merger.(20)                                                                                                                                                                    
|3.6     | Articles of Merger between the
      Company (as surviving entity) and Caleco Pharma Corp. (as merging entity),
      with surviving entity changing its name to Caleco Pharma
      Corp.(20)
|3.7     | Bylaws.(1)                                                                                                                                                                                    
|10.1    | Share Purchase Agreement among
      the Company, Inventa Holding GmbH, Skyflyer Technology GmbH and Perry
      Augustson, dated for reference the 31stday of March,
      2006.(3)          
|10.2    | Agreement and Deed of Transfer between Inventa
      Holding GmbH and the Company dated for reference as of the 19thday of April, 2006.(4)                                                    
|10.3    | Patent Transfer Agreement
      between Dieter Wagels and Skyflyer Technology GmbH, dated effective as of
      April 17, 2006.(4)                                                            
|10.4    | Loan Agreement between Dast GmbH and Skyflyer
      Technology GmbH dated December 8, 2006.(5)                                                                                                
|10.5    | Employment contract between
      Skyflyer Technology GmbH and Dr. Manfred Sappok, dated for reference as of
      June 1, 2005 (translated from German to English).(6)                       
|10.6    | Employment contract between Skyflyer Technology
      GmbH and Dieter Wagels, dated for reference as of January 1, 2006
      (translated from German to English).(6)                         
|10.7    | Purchase Agreement dated
      October 3, 2007 between American Yellowcake Resources Inc. and Skyflyer
      Inc.(8)                                                                          
|10.8    | Loan Agreement dated October 17, 2007 between
      the Company and Black Pointe Holdings Inc.(9)                                                                                             

16

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|Exhibit |                                                                                                                                                                                                                                     
|------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Number  | Description of Exhibits                                                                                                                                                                                                             
|10.9    | Extension to Loan Agreement
      between Dast GmbH and Skyflyer Technology GmbH, dated July 30, 2007
      (translated from German to English).(12)                                                                                
|10.10   | Second Extension to Loan Agreement between Dast
      GmbH and Skyflyer Technology GmbH, dated December 31, 2007 (translated
      from German to English).(12)                                                                     
|10.11   | Loan Agreement between Dast
      GmbH and Skyflyer Technology GmbH dated November 28, 2007 (translated from
      German to English).(12)                                                                                          
|10.12   | Loan Agreement between Dast GmbH and Skyflyer
      Technology GmbH dated December 6, 2007 (translated from German to
      English).(12)                                                                                           
|10.13   | Loan Agreement between Dast
      GmbH and Skyflyer Technology GmbH dated December 7, 2007 (translated from
      German to English).(12)                                                                                           
|10.14   | Management Consultant Agreement dated March 1,
      2008 between the Company and Dr. Rudolf Mauer.(11)                                                                                                                             
|10.15   | Share Exchange Agreement dated
      for reference as of March 31, 2008 among Blackstone Lake Minerals Inc.,
      Inventa Holding GmbH and Skyflyer Technology GmbH.(13)                                                           
|10.16   | Management Consultant Agreement dated October
      1, 2008 between the Company and John Boschert.(14)                                                                                                                              
|10.17   | Technology Purchase Agreement
      dated October 16, 2008 among the Company, NY Financial (International)
      Corp., Caleco Pharma Corp. (our former wholly owned subsidiary) and John
      Boschert.(15)                       
|10.18   | Amendment Agreement to Technology Purchase
      Agreement dated October 16, 2008 among the Company, NY Financial
      (International) Corp., Caleco Pharma Corp. (our former wholly owned
      subsidiary) and John Boschert.(16)
|10.19   | Technology Purchase Agreement
      dated December 19, 2008 among the Company, NY Financial (International)
      Corp., Caleco Pharma Corp. (our former wholly owned subsidiary) and John
      Boschert.(17)                      
|10.20   | Promissory Note between Caleco Pharma Corp.
      (our former wholly owned subsidiary) and NY Financial (International)
      Inc.(18)                                                                                              
|10.21   | Investor Relations Service
      Agreement between the Company and Evergreen Marketing, Inc. dated October
      6, 2009.(21)                                                                                                       
|10.22   | Consulting Agreement dated October 27, 2009
      between the Company and Professor Harry H.S. Fong.(22)                                                                                                                            
|10.23   | License Agreement dated
      November 1, 2009 between the Company and Caleco Pharma S.L.(23)                                                                                                                                       
|10.24   | Consulting Agreement dated December 17, 2009
      between the Company and Peter Kitzinski.(24)                                                                                                                                     
|10.25   | Consulting Agreement dated for
      reference February 1, 2010 between the Company and BlueWater Advisory
      Group, LLC.(25)                                                                                                    
|10.26   | Designated Sponsor Agreement dated February 9,
      2010 between the Company and ICF Kursmackler AG.(25)                                                                                                                           
|10.27   | Share Purchase Agreement dated
      February 10, 2010 among the Company, Natac Biotech S.L., and the principal
      shareholders of Natac Biotech S.L.(25)                                                                        
|10.28   | Letter Agreement dated February 10, 2010
      between the Company and Natac Biotech S.L.(25)                                                                                                                                       
|10.29   | Promissory Note dated February
      10, 2010 between the Company and Natac Biotech S.L.(25)                                                                                                                                        
|10.30   | Lab Facilities and Service Agreement dated for
      reference February 18, 2010 between the Company and Natac Biotech
      S.L.(26)                                                                                               
|10.31   | License Agreement dated March
      12, 2010 between the Company and Natac Biotech S.L.(27)                                                                                                                                         
|10.32   | Amendment Agreement to Share Purchase Agreement
      dated March 19, 2010 among the Company, Natac Biotech, S.L. and the
      principal shareholders of Natac Biotech S.L.(28)                                                    
|10.33   | Amendment Agreement to Lab
      Facilities and Services Agreement dated March 19, 2010 between the Company
      and Natac Biotech, S.L. (28)                                                                                      
|10.34   | Second Amendment Agreement to Share Purchase
      Agreement dated for reference April 19, 2010 among the Company, Natac Biotech, S.L. and the
      principal shareholders of Natac Biotech S.L. (29)                              

17

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|Exhibit |                                                                                                                                                                    
|------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Number  | Description of Exhibits                                                                                                                                            
|10.35   | Second Amendment Agreement to
      Lab Facilities and Services Agreement dated for reference April 19, 2010
      between the Company and Natac Biotech, S.L. (29)
|10.36   | Management Consulting Agreement dated June 11,
      2010 between the Company and Luc Vanhal(30)                                                                   
|10.37   | Third Amendment Agreement to
      Lab Facilities and Services Agreement dated for reference May 19, 2010
      between the Company and Natac Biotech, S.L.(30)    
|10.38   | Public Relations, Promotion and Marketing
      Letter Agreement dated August 12, 2010 between the Company and Mary Kratka
      d/b/a CityVac                     
|14.1    | Code of Ethics.(2)                                                                                                                                                 
|31.1    | Certification of Chief Executive Officer as
      adopted pursuant to Section 302 of the Sarbanes- Oxley Act of 2002.                                              
|31.2    | Certification of Chief
      Financial Officer as adopted pursuant to Section 302 of the Sarbanes-
      Oxley Act of 2002.                                        
|32.1    | Certification of Chief Executive Officer as
      adopted pursuant to Section 906 of the Sarbanes- Oxley Act of 2002.                                              
|32.2    | Certification of Chief
      Financial Officer as adopted pursuant to Section 906 of the Sarbanes-
      Oxley Act of 2002.                                        

Notes:

|(1)  | Filed as an exhibit to our Registration Statement on Form
      SB-2 originally filed on January 14, 2005, as amended.
|---- | ----------------------------------------------------------------------------------------------------------------------
|(2)  | Filed as an exhibit to our Annual Report on Form 10-KSB
      filed on January 30, 2006.                              
|(3)  | Filed as an exhibit to our Current Report on Form 8-K
      filed on April 10, 2006.                                  
|(4)  | Filed as an exhibit to our Current Report on Form 8-K
      filed on April 26, 2006.                                  
|(5)  | Filed as an exhibit to our Current Report on Form 8-K
      filed on December 15, 2006.                               
|(6)  | Filed as an exhibit to our Annual Report on Form 10-KSB
      filed on January 30, 2007.                              
|(7)  | Filed as an exhibit to our Quarterly Report on Form
      10-QSB filed on September 19, 2007.                         
|(8)  | Filed as an exhibit to our Current Report on Form 8-K
      filed on October 11, 2007.                                
|(9)  | Filed as an exhibit to our Current Report on Form 8-K
      filed on October 23, 2007.                                
|(10) | Filed as an exhibit to our Current Report on Form 8-K
      filed on January 25, 2008.                                
|(11) | Filed as an exhibit to our Current Report on Form 8-K
      filed on March 13, 2008.                                  
|(12) | Filed as an exhibit to our Quarterly Report on Form
      10-QSB filed on March 21, 2008.                             
|(13) | Filed as an exhibit to our Current Report on Form 8-K
      filed on April 8, 2008.                                   
|(14) | Filed as an exhibit to our Current Report on Form 8-K
      filed on October 7, 2008.                                 
|(15) | Filed as an exhibit to our Current Report on Form 8-K
      filed on October 22, 2008.                                
|(16) | Filed as an exhibit to our Current Report on Form 8-K
      filed on December 2, 2008.                                
|(17) | Filed as an exhibit to our Current Report on Form 8-K
      filed on December 29, 2008.                               
|(18) | Filed as an exhibit to our Current Report on Form 8-K
      filed on January 27, 2009.                                
|(19) | Filed as an exhibit to our Annual Report on Form 10-K
      filed on February 13, 2009.                               
|(20) | Filed as an exhibit to our Current Report on Form 8-K
      filed on September 4, 2009.                               
|(21) | Filed as an exhibit to our Current Report on Form 8-K
      filed on October 9, 2009.                                 
|(22) | Filed as an exhibit to our Current Report on Form 8-K
      filed on November 2, 2009.                                
|(23) | Filed as an exhibit to our Current Report on Form 8-K
      filed on November 5, 2009.                                
|(24) | Filed as an exhibit to our Current Report on Form 8-K
      filed on December 23, 2009.                               
|(25) | Filed as an exhibit to our Current Report on Form 8-K
      filed on February 16, 2010.                               
|(26) | Filed as an exhibit to our Current Report on Form 8-K
      filed on February 22, 2010.                               
|(27) | Filed as an exhibit to our Quarterly Report on Form 10-Q
      filed on March 17, 2010.                               
|(28) | Filed as an exhibit to our Current Report on Form 8-K
      filed on February 22, 2010.                               
|(29) | Filed as an exhibit to our Current Report on Form 8-K
      filed on April 27, 2010                                   
|(30) | Filed as an exhibit to our Current Report on Form 8-K
      filed on June 11, 2010                                    

18

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SIGNATURES

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

|                               | CALECO PHARMA CORP.
|------------------------------ | -------------------
|                               |                    
|Date: September 20,
      2010 | By:                
|                               |                    
|                               |                    
|                               |                    
|                               |                    
|Date: September 20,
      2010 | By:                
|                               |                    
|                               |                    
|                               |                    

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