---

UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549

FORM 10-K

(Mark One)

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

For the fiscal year ended: December 31, 2008or

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

For the transition period from __________________ to
__________________

Commission file number: 000-49833

ACRONGENOMICS INC.(Exact name of registrant as specified in its charter)

|Nevada                                                             | 52-2219285                          
|------------------------------------------------------------------ | ------------------------------------
|State or other jurisdiction of incorporation or
      organization | (I.R.S. Employer Identification No.)

Fairfax House, 15 Fulwood Place, London UK WC1V
6AY(Address of principal executive offices and Zip Code)

Registrant's telephone number, including area code 30 697
724 3620

Securities registered pursuant to Section 12(b) of the Act

|Title of Each Class | Name of each Exchange on which registered
|------------------- | -----------------------------------------
|Nil                 | N/A                                      

Securities registered pursuant to Section 12(g) of the Act

Common Stock, par value $0.001 per share(Title
of Class)

Indicate by check mark if the registrant is a well-known
seasoned issuer, as defined in Rule 405 of the Securities Act. Yes
[   ]    No [X]

Indicate by check mark if the registrant is not required to file
reports pursuant to Section 13 or Section 15(d) of the Act. Yes
[   ]    No [X]

Note  Checking the box above will not relieve any registrant
required to file reports pursuant to Section 13 or 15(d) of the Exchange Act
from their obligations under those Sections.

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

---

ii

Indicate by check mark if disclosure of delinquent filers
pursuant to Item 405 of Regulation S-K (§ 229.405 of this chapter) is not
contained herein, and will not be contained, to the best of registrants
knowledge, in definitive proxy or information statements incorporated by
reference in Part III of this Form 10-K or any amendment to this Form 10-K.
Yes [   ]    No [X]

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 Act).Yes[   ]    No [X]

State the aggregate market value of the voting and non-voting
common equity held by non-affiliates computed by reference to the price at
which the common equity was last sold, or the average bid and asked price of
such common equity, as of the last business day of the registrants most
recently completed second fiscal quarter.

21,873,738 common shares at a price of $0.55 per share for an
aggregate market value of $12,030,556 1

1 The aggregate market value of the voting stock held
by non-affiliates is computed by reference to the average bid and asked
price as of the last business day of our most recently completed second
fiscal quarter.

Indicate the number of shares outstanding of each of the
registrants classes of common stock, as of the latest practicable date:
24,597,981 shares of common stock are issued and outstanding as of April 14,
2009.

DOCUMENTS INCORPORATED BY REFERENCE

Not Applicable

---

iii

TABLE OF CONTENTS

|PART
      I                                                                                                                     | 1 
|-------------------------------------------------------------------------------------------------------------------------------- | --
|ITEM
      1. BUSINESS                                                                                                           | 1 
|ITEM
      1A. RISK FACTORS                                                                                                      | 8 
|ITEM
      1B. UNRESOLVED STAFF COMMENTS                                                                                         | 12
|ITEM
      2. PROPERTIES                                                                                                         | 12
|ITEM
      3. LEGAL PROCEEDINGS                                                                                                  | 12
|ITEM
      4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS                                                                | 12
|PART
      II                                                                                                                    | 13
|ITEM
      5. MARKET FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND
      ISSUER PURCHASES OF EQUITY SECURITIES | 13
|ITEM
      6 SELECTED FINANCIAL DATA                                                                                             | 14
|ITEM
      7 MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
      OF OPERATION                          | 14
|ITEM
      7A QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK                                                         | 22
|ITEM
      8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA                                                                        | 22
|ITEM
      9A(T). CONTROLS AND PROCEDURES                                                                                        | 24
|ITEM
      9B OTHER INFORMATION                                                                                                  | 25
|PART
      III                                                                                                                   | 26
|ITEM
      10 DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE                                                             | 26
|ITEM
      11. EXECUTIVE COMPENSATION                                                                                            | 29
|ITEM
      12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
      RELATED STOCKHOLDER MATTERS.             | 31
|ITEM
      13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR
      INDEPENDENCE                                   | 33
|ITEM
      14. PRINCIPAL ACCOUNTING FEES AND SERVICES                                                                            | 34
|PART
      IV                                                                                                                    | 35
|ITEM
      15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES.                                                                          | 35
|SIGNATURES                                                                                                                       | 36

---

- 1 -

PART I

ITEM 1. BUSINESS

Forward-Looking Statements

This report contains forward-looking statements. These
statements relate to future events or our future financial performance. In some
cases, you can identify forward-looking statements by terminology such as may,
should, expects, plans, anticipates, believes, estimates,
predicts, potential or continue or the negative of these terms or other
comparable terminology. These statements are only predictions and involve known
and unknown risks, uncertainties and other factors, including the risks in the
section entitled Risk Factors, that may cause our companys or our industrys
actual results, levels of activity, performance or achievements to be materially
different from any future results, levels of activity, performance or
achievements expressed or implied by these forward-looking statements.

Although we believe that the expectations reflected in the
forward-looking statements are reasonable, we cannot guarantee future results,
levels of activity, performance or achievements. Except as required by
applicable law, including the securities laws of the United States, we do not
intend to update any of the forward-looking statements to conform these
statements to actual results.

In this report, unless otherwise specified, all references to
common shares refer to the common shares of our capital stock.

As used in this annual report, the terms we, us, our, and
Acrongenomics refer to Acrongenomics, Inc., unless otherwise indicated.

Corporate Overview

We were incorporated under the laws of the State of Nevada on
August 17, 1999 under the name Cellway Ventures Inc. On February 25, 2004, we
changed the name of our company to Acrongenomics, Inc.

We are a development stage company focusing on investing and
commercializing novel technology platforms concerning the life sciences sector.
We intend to acquire a subsidiary that has an interest in the intellectual
property rights to a potential cholesterol-lowering agent that is currently in
development. Until recently we were engaged solely in the business of the
development of BioLED Technology, combining microfluidics and polymer Light
Emitting Diodes (pLED) for use in future Point-of-Care diagnostic devices. On
August 19, 2008, we entered into an agreement with Molecular Vision Limited of
the United Kingdom, which substantially changed our relationship with Molecular
Vision and changed the focus of our business. On as of August 19, 2008, upon the
closing of our agreement with Molecular Vision, we held 25% of the issued and
outstanding shares of Molecular Vision, which owns the BioLED technology. As a
result of this new arrangement, we intend to be much less involved with the
development of the BioLED technology than we have been in the past and we intend
to focus instead on acquiring an interest in another technology through
obtaining approximately 60% of the issued and outstanding shares of Vardisto
Investments Limited, as further described in the section entitled New
Development Agreement below. However, we are still interested in the BioLED
technology and will continue to work toward finding more uses for it in the
market. As of April 14, 2009, we hold 33,734 common shares of Molecular Vision,
which represents approximately 17% of the issued and outstanding shares of
Molecular Vision.

Background

We are a development stage company focusing on investing and
commercializing novel technology platforms concerning the Life Sciences
sector.

---

- 2 -

Initially, we focused our research and development efforts in
the In Vitro Diagnostic (IVD) sector. Our first product was the EP-CAM
Detection Kit, which was a molecular diagnostic test for micrometastatic cancer
of epithelial origin. At the same time, we entered into a strategic
collaboration with EuroGenet Labs S.A., a Greek research laboratory located in
Athens, Greece, in order to explore future prospects by evaluating the
technology behind existing implementations. We no longer offer the kit or work
with EuroGenet Labs S.A.

In May 2006, we began working with Molecular Vision via a Joint
Development Agreement concerning their potential technology platform combining
microfluidics with an optical detection system based on polymer Light Emitting
Diodes (commonly referred to as pLED) to deliver potentially affordable,
intelligent and readily portable Point-Of-Care (POC) medical diagnostic devices.
The technology platform combining microfluidics and pLED is known as BioLED
Technology. We then estimated that the proprietary molecular diagnostics
technology platform still required extensive research costs and experiments for
the next two to three years before it reached a stage to attract the interest of
large pharmaceutical/diagnostics companies. We also felt that the series of
experiments required to advance the proprietary molecular diagnostic
technologies needed to be conducted by highly qualified personnel could devote
100% of their efforts to the project. Most probably, the development of the
proprietary molecular diagnostics technology platform would also require
collaborations with international university research centers equipped with
highly trained personnel and appropriate instruments.

In early 2006, our Board of Directors decided that to devote
100% of our companys attention and efforts on a single project such as the
molecular diagnostic technology platform for the next two to three years would
involve too much risk and market exposure. Therefore, it was necessary for our
company to diversify its research activities.

BioLED Technology

As of August 19, 2008, we held 25% of the issued and
outstanding shares of Molecular Vision, a research company registered in London,
England, which owns and is developing the BioLED technology. As of April 14,
2009, we own a 17.2% interest in Molecular Vision.

On May 22, 2006, we signed a Joint Development Agreement with
Molecular Vision. Molecular Vision Limited, has developed, within their fields
of research at Imperial College London, a technology platform combining
microfluidics with an optical detection system based on polymer Light Emitting
Diodes (commonly referred to as pLED) to deliver potentially affordable,
intelligent and readily portable Point-Of-Care (POC) medical diagnostic devices.
The technology platform combining microfluidics and pLED is known as BioLED
Technology. Under such Joint Development Agreement with Molecular Vision
Limited, we had the exclusive rights to develop and commercialize the existing
intellectual properties related to the BioLED Technology and had first refusal
rights to develop any additional applications derived from Molecular Visions
research and development results. This agreement was replaced in its entirety by
subsequent agreement and we no longer have the development and commercialization
rights or the first refusal rights relating to the BioLED technology.

On February 27, 2007, we began negotiations to amend the
Development Agreement with Molecular Vision Limited previously dated May 22,
2006. On March 8, 2007, Molecular Vision Limited, successfully demonstrated its
BioLED Lab-on-a-Chip Technology using their patented, organic semi conductor
technology in a high sensitivity, small size, medical diagnostic device that
took place at Imperial College in London, UK. The device demonstrated its
technological capability to measure biomarkers with high sensitivity and at a
low cost. Acrongenomics and Molecular Vision believe that this technology is
capable of further miniaturization and that it will, along with large scale, low
cost manufacturing, bring forward disposable, Point-of-Care diagnostic for large
range markers.

On April 17, 2007, we announced that Molecular Vision Limited
had been successful in winning the £250,000 Royal Society Brian Mercer Award for
Innovation 2007. This is a prestigious award from the UKs Royal Society to
develop low-cost, high throughput, reel to reel, manufacturing techniques for
plastic electronics.

On May 23, 2007, we signed a new Development Agreement with
Molecular Vision Limited. This agreement replaced the Development Agreement
entered on May 22, 2006. The replacement agreement reduced the total payments
due to Molecular Vision by £550,000 to a total of £2,325,000. The replacement
agreement also re-priced

---

- 3 -

the exercise price of 2,000,000 options granted to Molecular
Vision Limited from $2.00 to $0.50. This agreement was replaced in its entirety
by subsequent agreement.

On October 11, 2007, we demonstrated the successful
implementation of a fully functional, portable medical diagnostic demonstrator
of their Lab-on-a-Chip technology. The demonstrator employs patented, organic
semiconductor technology in a high sensitivity, handheld, medical diagnostic
device. The successful presentation of the demonstrator device took place at
Imperial College in London, UK.

On November 14, 2007, we entered into a letter of intent with
Molecular Vision Limited for the acquisition of a 100% of Molecular Vision,
whereby we would acquire, subject to certain payments, all of the intellectual
property and assets of Molecular Vision and retain the founders, Professor
Donald Bradley, Professor Andrew De Mello and Profession John De Mellou, and
their technical team to continue to lead the development of the POC devices and
technology at the Molecular Vision laboratory at Imperial College in London, UK.
On February 1, 2008, we agreed to extend the date to acquire 100% of that
company to March 14, 2008. However, we did not close on this transaction to
acquire 100% of Molecular Vision.

On February 1, 2008, we instead completed an agreement with
Molecular Vision Ltd. whereby we purchased 16,566 ordinary shares of Molecular
Vision for £549,991.20. The transaction gave us a 13.97% interest in the issued
and outstanding shares of Molecular Vision at that time.

Technology Update

Medical Diagnostic Testing  Point-of-Care Diagnostic
Devices

The multi-billion dollar point-of-care diagnostic market is set
to benefit most from the BioLED technology. BioLED offers a compelling solution
to point-of-care diagnostics. The stand-alone devices will generate quantitative
lab-quality results at the point-of-care using only small amounts of bodily
fluids such as blood and urine. The availability of such devices would directly
address key objectives of health providers in the UK, Europe and the US,
notably, reducing treatment time, improving quality of treatment, reducing
inequality of treatment by extending facilities available to remote surgeries
and improving ongoing care via home-based preventative and post-treatment
monitoring of at-risk patients. Potential products include:

- professional point-of-care devices (cartridge/reader configuration) for use
  in a physicians office, clinics and hospitals;
- single-use disposable diagnostic devices for home testing.

The current proof-of-concept projects have shown that both
immunoassays and colorimetric assays can be successfully implemented on the
platform. We are seeking to partner with diagnostic companies that are looking
to reduce existing laboratory-based test products to the point-of-care market.

Current Focus

We are a development stage company focusing on investing and
commercializing novel technology platforms concerning the life sciences sector.
We intend to acquire a subsidiary that has an interest in the intellectual
property rights to a potential cholesterol-lowering agent that is currently in
development.

Until August 19, 2008, we had been operating pursuant to an
amended Development Agreement dated February 27, 2007, whereby we funded the
development of the Point-of-Care device of Molecular Vision in return for a
license to commercialize and sell the device. Under the August 19, 2008 interim
agreement and formal agreements dated November 14, 2008, we and Molecular Vision
terminated the Development Agreement, we received a royalty on product sales or
license fees received by Molecular Vision for products or licenses based on
Molecular Visions suite of patents, and we increased our ownership position in
Molecular Vision by virtue of receiving an additional 17,168 shares of Molecular
Vision as partial consideration for terminating our development agreement. As a
result

---

- 4 -

of the restructuring of our relationship with Molecular Vision,
we are now expected to seek other development opportunities in fields possibly
related or complimentary to the Molecular Vision technology.

Over the next 12 months, we believe that Molecular Vision will
continue to develop to prototype Point-of Care testing device for diabetes
management and cardiovascular testing.

Over the next 12 months, we will focus on completing the
acquisition of Vardisto Investments Limited, as described below.

New Development Agreement

Effective January 31, 2009 and subsequent to the December 31,
2008 audited financial statements, Acrongenomics entered into a Share Exchange
Agreement with Vardisto Investments Limited (Vardisto), a private Cyprus
company. Pursuant to the share exchange agreement we agreed, among other things,
to acquire 60%, a total outstanding share capital or 600 shares of common stock
of Vardisto in exchange for the issuance of 9,000,000 shares of our common
stock. This agreement has not yet closed and the acquisition has not yet taken
place.

Vardistos main asset is its interest in Halldale Ventures
Limited (Halldale). Halldale is a private Cyprus company in which Vardisto
holds an 80% interest.

Effective January 30, 2009, Halldale entered into an asset
purchase agreement with Maragrita Hadzopoulou-Cladaras. Pursurant to the asset
purchase agreement, Halldale agreed, among other things, to acquire certain
assets comprised mainly of intellectual property and certain research materials
from Ms. Hadzopoulou-Cladaras in exchange for 20% of its issued and outstanding
shares of common stock.

The assets purchased by Halldale pursuant to the asset purchase
agreement include research materials and experimental results from the use of a
compound referred to as compound X as a hypolipidemic agent and development of
a potential cholesterol-lowering agent, in combination with essential oil
derived from plants.

The share exchange agreement is conditional upon certain events
occurring and there is no assurance that the share exchange agreement will
close.

BioLED Technology

We continue to have an interest in the development of the
BioLED Technology. Terms such as Lab-on-a-Chip or Point-of-Care Testing
(POCT) describe the concept of the technology, which is to have specialized,
light weight, readily portable and easy to use devices to perform complex
biological tests at the site where they are most needed. Traditionally, most of
the complex biological tests require specialized laboratories equipped with
bulky, expensive equipment and highly trained personnel. To realize the goal of
portable diagnostic devices for Point-of-Care testing, one will need to overcome
the difficulties of the lack of suitable miniaturization, low-power consumption
and optical detection systems.

By combining the microfluidic technology with the pLED/OLED
(Organic Light Emitting Diodes), we believe that BioLED Technology once
developed, will offer medical devices at the Point Of Care level that will allow
the quantitative and qualitative analysis of medical conditions with high
sensitivity and functionality at low cost.

Microfluidics refers to fluid flow in a network of
microchannels which can be integrated on disposable, low cost Lab-on-a-Chip
cartridges, while the flow of liquids or gases is controlled through valves and
switches. Microfluidics can automatically guide a test sample through the
various stages of an assay, perform multiple functions including sample
purification, mixing with analytes, labeling, reaction and separation of
products. Microfluidics can also be designed to guide the processed test sample
to the integrated detection component of a Point-of-Care testing device.

Low cost, organic semiconductor polymer Light Emitting Diodes
(pLED) with tunable optical properties provide BioLED Technology with low-power
consumption and optical detectable components in a Point-of-Care testing device.
Under electrical excitation the polymer emits light via radiative combination of
injected electrons and holes

---

- 5 -

and therefore may be used as a light source. The same structure
can then be used in reverse as a photodetector by illuminating the polymer in
order to generate a measurable electrical current.

In a future Point-of-Care testing device based on the BioLED
Technology, reagents of an assay will be mixed with the body fluid (blood,
urine) through the microfluidic network. The resulting mixture will be excited
by the integrated, battery driven pLED and the resulting light-signal will be
detected by the integrated photodetector, which will generate an electrical
readout.

A typical assay for disease markers comprises two steps.
First, specific immobilized antibodies are used to capture the protein markers
inside the detection zone. Secondly, fluorescently labeled detection antibodies
specific to the protein marker are flowed over the detection zone. The detection
antibodies bind to capture protein markers and unbound excess detection
antibodies are rinsed away. The labeled antibodies can then be excited with our
pLED light sources and any emitted fluorescence is detected with our organic
photodiodes. Without disease markers no detection antibodies are retained,
resulting in zero fluorescence. This format is applicable to most protein based
disease markers as long as suitable specific antibodies are available.

Market Potential

Following primary market research, a number of potential
Point-of-Care diagnostic device applications were evaluated in terms of
feasibility, market needs, generating revenue, market growth rate and
competition. Among these, two disease areas were chosen to be the primary
targets for BioLED device development. These Point-of-Care testing devices will
enable on-the-spot quantitative and qualitative diagnosis from a few drops of
blood, urine for:

Diabetes Management (Kidney Health Markers):

The prevalence of diabetes for all age-groups worldwide was
estimated to be 2.8% in 2000 and 4.4% in 2030. The total number of people with
diabetes is projected to rise from 171 million in 2000 to 366 million in 2030
(Global Prevalence of Diabetes. Diabetes Care 27:1047-1053, 2004).
Microalbuminuria, a well known diabetic nephropathy marker, is defined by
increased urinary Human Serum Albumin excretion. The Albumin Blue 580 (AB 580)
assay is based on a red emitting fluorophore with specific affinity to human
serum albumin. Upon binding to the human serum albumin, the fluorescence
efficiency of AB 580 increases by two orders of magnitude. AB 580 shows
significant fluorescence only when human serum albumin is present. If diagnosed
at an early stage, Microalbuminuria can be treated before its progression to the
development of diabetic nephropathy (kidney failure). Approximately 25  30% of
all diabetics develop evidence of nephropathy.

Cardiovascular Diseases (Cardiac Markers):

Cardiovascular diseases are responsible for the deaths of 17
million people worldwide each year, making them the developed worlds leading
cause of death according to the World Health Organization. 32 million heart
attacks and strokes per year demonstrate the need for the development of
accurate, cost efficient and accessible diagnostics. Conventional diagnostic
techniques, however, are costly, time consuming and of limited predictive
potential. A smarter diagnostic approach is the in vitro measurement of various
cardiac biomarkers of high preventive value, using a Point-of-Care device. The
cardiac biomarker tests are based on a sandwich immunoassay format. The
detectable species is the secondary antibody labeled with a fluorescent tag. The
antibodies to be used are anti-myoglobin (Myoglobin), CK-MB antibody (creatine
kinase), anti-troponin I (Troponin I).

Compliance with Government Regulation

Once fully developed, we intend to participate in the marketing
of the BioLED Technology based Point-of-Care testing devices primarily to
General Physicians and clinics/health centers mainly in the United States and in
Europe. We are aware that the production and marketing of medical testing
devices are subject to the laws and regulations of governmental authorities in
the United States and all other countries where the devices will be marketed.
Specifically, in the United States, the Food and Drug Administration (FDA),
among other agencies, regulates new

---

- 6 -

product approvals to establish safety and efficacy of these
products. Governments in other countries have similar legal bodies handling the
requirements for testing and marketing.

The Regulatory Process

FDA in the United States and Medical Devices Directive in
Europe, are the official bodies that cover the regulatory requirements for
medical devices. Medical devices are classified into Class I, II, and III.
Regulatory control increases from Class I to Class III. The device
classification regulation defines the regulatory requirements for a general
device type. Most Class I devices are exempt from Pre-market Notification
510(k); most Class II devices require Pre-market Notification 510(k); and most
Class III devices require Pre-market Approval (PMA).

Class I devices are defined as non-life sustaining.
These products are the least complicated and their failure poses little
risk.

Class II devices are more complicated and present more
risk than Class I, though are also non-life sustaining. They are also subject to
any specific performance standards.

Class III devices sustain or support life, so that their
failure is life threatening.

The basic regulatory requirements that manufacturers of medical
devices distributed in the U.S. must comply with are:

- Pre-market Notification 510(k), unless exempt, or Pre-market Approval
  (PMA),
- Establishment registration on form FDA-2891,
- Medical Device Listing on form FDA-2892,
- Quality System (QS) regulation,
- Labeling requirements, and
- Medical Device Reporting (MDR)

We envisage that the devices will be classified as Class I. The
devices will be used to diagnose rather than treat medical conditions.
Additionally, BioLED medical devices are non-invasive and the assays that will
be used for testing are already existing in the market. BioLED technology, once
developed, will cover a great medical niche and it may undergo fast track review
since there is no other such technology available in the market. Therefore, we
endeavor that regulatory procedures will be relatively benign and quick.

Regardless of how the BioLED technology is regulated, the
Federal Food, Drug, and Cosmetic Act and other Federal statutes and regulations
govern or influence the research, testing, manufacture, safety, labeling,
storage, record-keeping, approval, distribution, use, reporting, advertising and
promotion of our future products. Noncompliance with applicable requirements can
result in civil penalties, recall, injunction or seizure of products, refusal of
the government to approve or clear product approval applications or to allow us
to enter into government supply contracts, withdrawal of previously approved
applications and criminal prosecution.

Product Approval in the United States

The BioLED currently only in the developmental stage of our
technology, and therefore, we have not begun the process of seeking regulatory
approval from the FDA. Once BioLED Technology is fully developed, we intend to
consult with an FDA advisor to assist us in determining our path in the process
toward gaining regulatory approval. There can be no assurance that the BioLED
technology and potential products will ultimately receive regulatory approval.

We believe that BioLED Technology, if successfully developed,
may be considered appropriate as part of a medical device and will be then
subjected to the requirements of FDA for clinical testing to demonstrate safety
and effectiveness prior to the approval.

---

- 7 -

Product Approval in Europe

If the BioLED Technology is successfully developed and
potential Point-of-Care testing devices and seek regulatory approval in Europe,
we believe the BioLED Technology may be regulated in Europe as a Class I
Sterile, Class IIb or Class III medical device, under the authority of the
Medical Device Directives being implemented by European Union member countries.
These classifications apply to medical laboratory equipment and supplies
including, among other products, many devices that are used for the collection
and processing of blood for patient therapy.

The applicable regulations vest the authority to permit
affixing of the CE Mark with various notified bodies. These are private and
state organizations which operate under license from the member states of the
European Union to certify that appropriate quality assurance standards and
compliance procedures are followed by developers and manufacturers of medical
device products or, alternatively, that a manufactured medical product meets a
more limited set of requirements. Notified bodies are also given the
responsibility for determination of the appropriate standards to apply to a
medical product. Receipt of permission to affix the CE Mark enables a company to
sell a medical device or product in all European Union member countries. Other
registration requirements may also need to be satisfied in certain countries.
Molecular Vision has not received permission from a notified body to affix the
CE Mark to the BioLED Technology, nor have they as yet requested such
permission.

Status of Product

On March 8, 2007, a demonstrator device was presented at
Imperial College in London, UK, using MVL's patented, organic semiconductor
technology in a high sensitivity, small size, medical diagnostic device.

The device demonstrated its technological capability to measure
biomarkers with high sensitivity and at low cost.

On October 11, 2007, our company demonstrated the successful
implementation of a fully functional, portable medical diagnostic demonstrator
of their Lab-on-a-Chip technology. The demonstrator employs patented, organic
semiconductor technology in a high sensitivity, handheld, medical diagnostic
device. The stand alone two-channel, battery-powered device, complete with
digital display and self-referencing capability has demonstrated its capability
to measure clinically relevant markers with high sensitivity and at low cost. In
particular, the demonstrator device has been used successfully to measure
creatinine in urine at physiologically significant concentrations. The results,
obtained within seconds, were comparable to those obtained using a bench top
spectrometer. The successful presentation of the demonstrator device took place
at Imperial College in London, UK.

Molecular Vision is continuing to develop the prototype
Point-of-Care testing device for diabetes management and Cardiovascular testing
and has not yet begun the regulatory approval process.

In January of 2009, we entered into a share exchange agreement
with Vardisto Investments Limited (Vardisto), a private Cyprus company.
Pursuant to the share exchange agreement we agreed, among other things, to
acquire 60%, a total outstanding share capital or 600 shares of common stock of
Vardisto in exchange for the issuance of 9,000,000 shares of our common stock.
This agreement has not yet closed and the acquisition has not yet taken place.
There is no guarantee or assurance that the agreement will close and that the
acquisition will happen. Until it does, or we acquire an interest in another
technology, they only interest in technology that we have is indirect and held
via the 33,734 shares in the common stock of Molecular Vision.

Dependence on One or a Few Major Customers

We do not yet have any customers or customer contracts.
Employees and Consultants

Our company currently has two full time employees and one
part-time consultant. Our two employees are also directors of our company.

Mr. Platon Tzouvalis, President and Dr. Manos Topoglidis, Chief
Technology Officer are currently bound by a three year employment agreements
commencing April 1, 2007 and ending March 31, 2010.

---

- 8 -

The consulting agreement with a past President of
Acrongenomics, Mr. Constantine Poulios, for a period of one year ended March 31,
2009. This agreement is presently in the process of being negotiating for
renewal.

Our Director and CFO, Mr. Ron Lizée has been with Acrongenomics
since June of 2004 and is not on a contract.

Reports to Security Holders

We file reports and other information with the SEC. This annual
  report on Form 10-K, historical information about our company and other information
  can be inspected and copied at the Public Reference Room of the SEC located
  at Room 1580, 100 F Street, N.E., Washington D.C. 20549. Copies of such materials,
  including copies of any portion of this annual report on Form 10-K, can be obtained
  from the Public Reference Room of the SEC at prescribed rates. You can call
  the SEC at 1-800-SEC-0330 to obtain information on the operation of the Public
  Reference Room. Such materials may also be accessed electronically by means
  of the SECs home page on the Internet (http://www.sec.gov).

ITEM 1A. RISK FACTORS

Much of the information included in this report includes or is
based upon estimates, projections or other forward looking statements. Such
forward looking statements include any projections and estimates made by us and
our management in connection with our business operations. While these
forward-looking statements, and any assumptions upon which they are based, are
made in good faith and reflect our current judgment regarding the direction of
our business, actual results will almost always vary, sometimes materially, from
any estimates, predictions, projections, assumptions or other future performance
suggested herein. Such estimates, projections or other forward looking
statements involve various risks and uncertainties as outlined below. We
caution the reader that important factors in some cases have affected and, in
the future, could materially affect actual results and cause actual results to
differ materially from the results expressed in any such estimates, projections
or other forward looking statements.

Shares of our common stock are speculative, especially since we
are in the development stage of our new business. We operate in a volatile
sector of business that involves numerous risks and uncertainties. The risks and
uncertainties described below are not the only ones we face. Other risks and
uncertainties, including those that we do not currently consider material, may
impair our business. If any of the risks discussed below actually occur, our
business, financial condition, operating results or cash flows could be
materially adversely affected. This could cause the trading price of our
securities to decline, and you may lose all or part of your investment.
Prospective investors should consider carefully the risk factors set out below.

Risks Related to our Company

The global financial crisis has had, and may continue to
have, an impact on our business and financial condition.

The ongoing global financial crisis may also limit our ability
to access the capital markets at a time when we would like, or need, to raise
capital, which could have an impact on our ability to react to changing economic
and business conditions. Accordingly, if the global financial crisis and current
economic downturn continue or worsen, our business, results of operations and
financial condition could be materially and adversely affected.

We have not earned any revenues since our incorporation and
only have a limited operating history in our current business, which raise doubt
about our ability to continue as a going concern.

Our company has a limited operating history in our current
business and must be considered in the development stage. We have not generated
any revenues since our inception and we will, in all likelihood, continue to
incur operating expenses without significant revenues until Molecular Vision
successfully develops its BioLED Technology and commercializes its future
Point-of-Care testing devices. Our primary source of funds has been the sale of
our common stock. We cannot assure that we will be able to generate any
significant revenues or income. These circumstances make us dependent on
additional financial support until profitability is achieved. There is no

---

- 9 -

assurance that we will ever be profitable, and our auditors
have included an explanatory paragraph in their audit report dated April 13,
2009 that we are in the development stage, we have not yet achieved profitable
operations and we are dependent on our ability to raise capital from
shareholders or other sources to meet our obligations and repay our liabilities
arising from normal business operations when they come due. These factors, along
with other matters as set forth in Note 1 to our financial statements, raise
substantial doubt that the Company will be able to continue as a going concern.
Our financial statements do not include any adjustments that might result from
the outcome of these uncertainties.

Our Share Exchange Agreement with Vardisto Investments
Limited may not be completed and we may not obtain an interest in the
development of the potential cholesterol-lowering agent. Even if we do obtain an
interest in the potential cholesterol-lowering agent, there is no assurance that
it will ever become commercially viable. We may never develop and commercialize
any products. If this happens we will not become profitable and we will go out
of business.

Our Share Exchange Agreement with Vardisto Investments Limited
may not be completed and we may not obtain an interest in the development of the
potential cholesterol-lowering agent. Even if we do obtain an interest in the
potential cholesterol-lowering agent, there is no assurance that it will ever
become commercially viable. The development of life science technology is
extremely risky and expensive. It is likely that we will never develop and sell
a product that will make us profitable. If we never become profitable, we will
go out of business and investors will lose all of the money they have invested
in our company.

Risks Related to our Business

Our likelihood of profit depends on our ability to obtain,
develop and market a profitable life science technology. We currently do not
have such a technology. If we are unable to obtain such a technology and
successfully sell it, our company will likely fail and investors will lose their
entire investment in our company.

We do not own any technology. We hold only a 17.2 % interest in
Molecular Visions BioLED Technology, which is in the development stage.
Molecular Vision has not begun the regulatory approval process. We have not
realized a profit from our operations to date and there is little likelihood
that we will realize any profits in the short or medium term. Any profitability
in the future from our business will be dependent upon successful
commercialization of the of a technology product, which will require significant
additional research and development as well as clinical trials.

We need to raise additional financing to support the
research and development of future business but we cannot be sure that we will
be able to obtain additional financing on terms favorable to us when needed. If
we are unable to obtain additional financing to meet our needs, our operations
may be adversely affected or terminated.

Our ability to source and then develop a new technology is
dependent upon our ability to raise significant additional financing when
needed. If we are unable to obtain such financing, we will not be able to fully
develop and commercialize our technology. Our future capital requirements will
depend upon many factors, including:

- continued scientific progress in our research and development programs;
- costs and timing of conducting clinical trials and seeking regulatory
  approvals and patent prosecutions;
- competing technological and market developments;
- our ability to establish additional collaborative relationships; and
- the effect of commercialization activities and facility expansions if and
  as required.

We have limited financial resources and to date, no cash flow
from operations and we are dependent for funds on our ability to sell our common
stock, primarily on a private placement basis. There can be no assurance that we
will

---

- 10 -

be able to obtain financing on that basis in light of factors
such as the market demand for our securities, the state of financial markets
generally and other relevant factors. Any sale of our common stock in the future
will result in dilution to existing stockholders. Furthermore, there is no
assurance that we will not incur debt in the future, that we will have
sufficient funds to repay our future indebtedness or that we will not default on
our future debts, jeopardizing our business viability. Finally, we may not be
able to borrow or raise additional capital in the future to meet our needs or to
otherwise provide the capital necessary to conduct the development of our
technology, which might result in the loss of some or all of your investment in
our common stock.

We may be subject to intellectual property litigation such
as patent infringement claims, which could adversely affect our business.

Our success will depend largely on our ability to develop and
market life science technology without infringing the proprietary rights of
others. Other patents could exist or could be filed which would prohibit or
limit our ability to develop the technology we acquire in order to bring it to
market. In the event of an intellectual property dispute, we may be forced to
litigate. Intellectual property litigation would divert our attention away from
developing the technology and marketing our potential products and be very
expensive. An adverse outcome could take our ability to develop or commercialize
a potential product and could prevent us from becoming profitable.

Potential product liability claims could adversely affect
our future earnings and financial condition.

We face an inherent business risk of exposure to product
liability claims in the event that the use of our future products results in
adverse affects. As a result, we may incur significant product liability
exposure. We may not be able to maintain adequate levels of insurance at
reasonable cost and/or reasonable terms. Excessive insurance costs or uninsured
claims would add to our future operating expenses and adversely affect our
financial condition.

Because some of our officers and directors are located in
non-U.S. jurisdictions, you may have no effective recourse against the
management for misconduct and may not be able to enforce judgment and civil
liabilities against our officers, directors, experts and agents.

Most of our directors and officers are nationals and/or
residents of countries other than the United States, and all or a substantial
portion of their assets are located outside the United States. As a result, it
may be difficult for you to enforce within the United States any judgments
obtained against our officers or directors, including judgments predicated upon
the civil liability provisions of the securities laws of the United States or
any U.S. state.

If we are deemed to be an investment company under the
Investment Company Act, we may be required to institute burdensome compliance
requirements and our activities may be restricted.

The Investment Company Act of 1940, or the Investment
Company Act, contains substantive legal requirements that regulate the manner
in which investment companies are permitted to conduct their business
activities. If we are deemed to be an investment company under the Investment
Company Act, we may be required to institute burdensome compliance requirements
and our activities may be restricted, which would materially adversely affect
our business, financial condition and results of operations. In addition, our
contracts would be voidable and a court could appoint a receiver to take control
of and liquidate our business.

In order not to be regulated as an investment company under the
Investment Company Act, unless we can qualify for an exemption, we must ensure
that we are engaged primarily in a business other than investing, reinvesting,
owning, holding or trading in securities (as defined in the Investment Company
Act) and that we do not own or acquire investment securities having a value
exceeding 40% of the value of our total assets (exclusive of U.S. government
securities and cash items) on an unconsolidated basis. The SEC has adopted Rule
3a-1 that provides an exemption from registration as an investment company if a
company meets both an asset and an income test and is not otherwise primarily
engaged in an investment company business by, among other things, holding itself
out to the public as such or by taking controlling interests in companies with a
view to realizing profits through subsequent sales of these interests. A company
satisfies the asset test of Rule 3a-1 if it has no more than 45% of the value of
its total assets (adjusted to exclude U.S. Government securities and cash) in
the form of securities other than interests in majority-owned subsidiaries and
companies which it primarily and actively controls. A company satisfies the

---

- 11 -

income test of Rule 3a-1 if it has derived no more than 45% of
its net income for its last four fiscal quarters combined from securities other
than interests in majority owned subsidiaries and primarily controlled
companies.

Risks Related to our Common Stock

The recent weakening of economic conditions around the world
could have harmful effects on our company. If these harmful effects cause us to
cease our development of medical technologies, then our shareholders will likely
lose their entire investment in our company.

The recent weakening of economic conditions in the U.S. and
around the world could have harmful effects on our ability to raise money to
fund our planned operations. If this happens, we would likely go out of business
and our investors will lose their entire investment in our company.

We believe that recent decreases in value of the common shares
of many companies worldwide will make selling shares of our common stock
increasingly difficult. If we are not able to sell enough of our shares to meet
our financial needs, we will have to consider borrowing the money we need. A
tightening of credit conditions has also been experienced in the economy
recently. Because of the recent credit crisis, it is possible that we would not
be able to borrow adequate amounts to fund our operations on terms and at rates
of interest we find acceptable and in the best interests of our company. If we
are unable to obtain the amount of money that we need to fund our operations,
then we will likely go out of business and investors will lose their entire
investment in our company.

Because we do not intend to pay any dividends on our common
stock, investors seeking dividend income or liquidity should not purchase shares
of our common stock.

We have not declared or paid any dividends on our common stock
since our inception, and we do not anticipate paying any such dividends for the
foreseeable future. Investors seeking dividend income or liquidity should not
invest in our common stock.

If we issue additional shares in the future, it will result
in the dilution of our existing shareholders.

Our certificate of incorporation authorizes the issuance of up
to 100,000,000 shares of common stock with a par value of $0.001. Our board of
directors may choose to issue some or all of such shares to acquire one or more
businesses or to provide additional financing in the future. The issuance of any
such shares will result in a reduction of the book value and market price of the
outstanding shares of our common stock. If we issue any such additional shares,
such issuance will cause a reduction in the proportionate ownership and voting
power of all current shareholders. Further, such issuance may result in a change
of control of our corporation.

Our stock is considered a penny stock and certain
securities rules may hamper the tradability of our shares in the market.

Shares of our common stock are subject to rules adopted by the
Securities and Exchange Commission that regulate broker-dealer practices in
connection with transactions in penny stocks. Penny stock is defined to be
any equity security that has a market price (as defined) less than $5.00 per
share or an exercise price of less than $5.00 per share, subject to certain
exceptions. Our common stock are covered by the penny stock rules, which impose
additional sales practice requirements on broker-dealers who sell to persons
other than established customers and accredited investors. The term
accredited investor refers generally to institutions with assets in excess of
$5,000,000 or individuals with a net worth in excess of $1,000,000 or annual
income exceeding $200,000 or $300,000 jointly with their spouse. The penny stock
rules require a broker-dealer, prior to a transaction in a penny stock not
otherwise exempt from the rules, to deliver a standardized risk disclosure
document in a form prepared by the SEC which provides information about penny
stocks and the nature and level of risks in the penny stock market. The
broker-dealer also must provide the customer with current bid and offer
quotations for the penny stock, the compensation of the broker-dealer and its
salesperson in the transaction and monthly account statements showing the market
value of each penny stock held in the customer's account. The bid and offer
quotations, and the broker-dealer and salesperson compensation information, must
be given to the customer orally or in writing prior to

---

- 12 -

effecting the transaction and must be given to the customer in
writing before or with the customer's confirmation. In addition, the penny stock
rules require that prior to a transaction in a penny stock not otherwise exempt
from these rules, the broker-dealer must make a special written determination
that the penny stock is a suitable investment for the purchaser and receive the
purchaser's written agreement to the transaction. These disclosure requirements
may have the effect of reducing the level of trading activity in the secondary
market for the stock that is subject to these penny stock rules. Consequently,
these penny stock rules may affect the ability of broker-dealers to trade our
securities.

The Financial Industry Regulatory Authority, or FINRA, has
adopted sales practice requirements which may also limit a stockholder's ability
to buy and sell our stock.

In addition to the penny stock rules described above, FINRA has
adopted rules that require that in recommending an investment to a customer, a
broker-dealer must have reasonable grounds for believing that the investment is
suitable for that customer. Prior to recommending speculative low priced
securities to their non-institutional customers, broker-dealers must make
reasonable efforts to obtain information about the customer's financial status,
tax status, investment objectives and other information. Under interpretations
of these rules, FINRA believes that there is a high probability that speculative
low priced securities will not be suitable for at least some customers. FINRA
requirements make it more difficult for broker-dealers to recommend that their
customers buy our common stock, which may limit your ability to buy and sell our
stock and have an adverse effect on the market for our shares.

ITEM 1B. UNRESOLVED STAFF COMMENTS

Not Applicable.

ITEM 2. PROPERTIES

Executive Offices and Resident Agent

Acrongenomics has a registered office for mailing services at
Fairfax House, 15 Fulwood Place, London UK WC1V 6AY, at cost of £705 per year.

Our registered office for service in the State of Nevada is
located at Paracorp Incorporated, 318 N Carson St #208, Carson City, NV 89701.

On October 1, 2008, Acrongenomics Inc. signed a two year
management and operational services agreement, which includes rental of office
space, reception and secretarial services, at $5,000 per month and located at
115 Ag. Paraskevis Street, Halandri, Greece.

During the year, Acrongenomics terminated a month-to-month
Management Agreement for $10,000 per month with CASAD Sarl for office space and
administration in Geneva, Switzerland.

Acrongenomics terminated a rental agreement with PKL Ltd. for
the rental of a Flat in London for £488 per week.

ITEM 3. LEGAL PROCEEDINGS

We know of no material, existing or pending legal proceedings
against our company, nor are we involved as a plaintiff in any material
proceeding or pending litigation. There are no proceedings in which any of our
directors, officers or affiliates, or any registered or beneficial shareholder,
is an adverse party or has a material interest adverse to our interest.

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

None

---

- 13 -

PART II

ITEM 5. MARKET FOR REGISTRANTS COMMON EQUITY, RELATED
STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

Market information

Our Common stock is quoted on the OTC Bulletin Board under the
Symbol AGNM. Our stock was originally approved for trading on the OTC Bulletin
Board on July 15, 2003 under the symbol CWYV and was changed to AGNM on
March 4, 2004 in connection with a change of name.

The following table reflects the high and low bid information
for our common stock obtained from the OTC Bulletin Board and reflects
inter-dealer prices, without retail mark-up, markdown or commission, and may not
necessarily represent actual transactions.

The high and low bid prices of our common stock for the periods
indicated below are as follows:

End Date
    
    Bid High
    
    
    Bid Low
    
    
    Close12/31/2008
    $
    0.35
    
    $
    0.20
    
    $
    -09/30/2008
    $
    0.54
    
    $
    0.25
    
    $
    -06/30/2008
    $
    0.64
    
    $
    0.35
    
    $
    -03/31/2008
    $
    1.05
    
    $
    0.53
    
    $
    -12/31/2007
    $
    1.33
    
    $
    0.80
    
    $
    -09/28/2007
    $
    1.25
    
    $
    0.69
    
    $
    -06/29/2007
    $
    1.56
    
    $
    0.70
    
    $
    -03/30/2007
    $
    1.75
    
    $
    0.35
    
    $
    -


On April 7, 2009, the closing price for the common stock as
reported by the quotation service operated by the OTC Bulletin Board was $0.34.

Transfer Agent

Our common shares are issued in registered form. The Pacific
Stock Transfer Company of 500 E. Warm Springs Road, Suite 240, Las Vegas NV
89119, Phone: (702) 361-3033, Fax: (702) 433-1979 is the registrar and transfer
agent for our common shares.

Holders of Common Stock

As of April 1, 2009, there were 219 registered holders of
record of our common stock. As of such date, 24,597,981 common shares were
issued and outstanding.

Dividends

We have not paid any cash dividends on our common stock and
have no present intention of paying any dividends on the shares of our common
stock. Our current policy is to retain earnings, if any, for use in our
operations and in the development of our business. Our future dividend policy
will be determined from time to time by our board of directors.

Recent Sales of Unregistered Securities; Use of Proceeds
from Registered Securities

On February 1, 2008, our company issued 300,000 common shares
valued at a quoted market price of $0.95 per share to two consultants for past
and future services to be rendered. We issued the common shares to non U.S.

---

- 14 -

person (as that term is defined in Regulation S of the
Securities Act of 1933) in an offshore transaction relying on Regulation S and
/or Section 4(2) of the Securities Act of 1933.

On February 1, 2008, the Company issued 90,000 units at $1.10
per unit for total proceeds of $99,000. Each unit consists of one common share
and one-half of one common share purchase warrant. Each warrant entitles the
holder the right to purchase one common share of the Company at $1.50. The
warrants expire on August 1, 2009.

On February 14, 2008, our Company issued 1,150,000 common
shares valued at a quoted market price of $0.79 per share to two of our officers
as a bonus for services rendered to the Company. We issued the common shares to
non U.S. persons (as that term is defined in Regulation S of the Securities Act
of 1933) in an offshore transaction relying on Regulation S and/or Section 4(2)
of the Securities Act of 1933.

On February 15, 2008, the Company issued 1,250,010 units at
$0.80 per unit for total proceeds of $1,000,008. Each unit consists of one share
of common share and one common share purchase warrant. Each warrant entitles the
holder the right to purchase one share of common stock of the Company at $1.60.
The warrants expire on August 15, 2009.

On June 12, 2008 and November 14, 2008, the Company issued
150,000 and 200,000 shares valued at quoted market prices of $0.53 per share and
$0.27 per share respectively to a Director in recognition of services to the
Company.

Between July 2, 2008 and December 3, 2008, the Company issued
1,450,250 units at .40 per unit for total proceeds of $580,100. Each unit
consists of one share of common share and one common share purchase warrant.
Each warrant entitles the holder the right to purchase one share of common stock
of the Company at $0.75.

On December 12, 2008 the Company issued 1,450,000 shares valued
at a quoted market price of $0.27 per share to three (3) consultants of the
Company for past and present services.

Purchases of Equity Securities by the Issuer and
Affiliated Purchasers

The following table is a summary of purchases made by or on
behalf of our company or any "affiliated purchaser," of shares or other units of
any class of the our equity securities that is registered by the issuer pursuant
to section 12 of the Exchange Act.

ISSUER
        PURCHASES OF EQUITY SECURITIES(a)
      (b)
      (c)
      (d)Period
      Total Number of Shares (or Units) Purchased
      Average Price Paid
        per Share (or Unit)
      Total Number of Shares
        (or Units) Purchased as Part of Publicly Announced
        Plans or Programs
      Maximum Number (or Approximate
        Dollar Value) of Shares (or Units) that May Yet
        Be Purchased Under the Plans or ProgramsN/A
      Nil
      Nil
      Nil
      Nil


ITEM 6 SELECTED FINANCIAL DATA

Not applicable.

ITEM 7 MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATION

Overview

The following is a discussion and analysis of our plan of
operation for the next year ended December 31, 2009 and the factors that could
affect our future financial condition and plan of operation.

---

- 15 -

This discussion and analysis should be read in conjunction with
our financial statements and the notes thereto included elsewhere in this annual
report. Our financial statements are prepared in accordance with United States
generally accepted accounting principles. All references to dollar amounts in
this section are in United States dollars unless expressly stated otherwise.
Please see our Note on Forward Looking Statements and Risk Factors for a
list of our risk factors.

Plan of Operations

On August 19, 2008, we entered into an agreement with Molecular
Vision Limited of the United Kingdom which changed our relationship
substantially, and changed the focus of our business.

Until August 19, 2008, we had been operating pursuant to a
Development Agreement dated February 27, 2007, whereby we funded the development
of the Point-of-Care device of Molecular Vision in return for a license to
commercialize and sell the device. Under the August 19, 2008 interim agreement
and formal agreements dated November 13, 2008, we and Molecular Vision
terminated the Development Agreement, we received a royalty on product sales or
license fees received by Molecular Vision for products or licenses based on
Molecular Visions suite of patents, and, as well, we received 17,168 additional
common shares of Molecular Vision. As of April 14, 2009, we hold a 17.19%
interest the issued and outstanding shares of Molecular Vision. As a result of
the restructuring of our relationship with Molecular Vision, we now intend to
seek other development opportunities in fields possibly related or complimentary
to the Molecular Vision technology.

Over the next 12 months Molecular Vision will continue to
develop to prototype Point-of Care testing device for diabetes management and
cardiovascular testing. We will continue to work toward finding more uses for it
in the market and will continue to follow the development of the technology.

New Development Agreement

Effective January 31, 2009 and subsequent to the December 31,
2008 audited financial statements, Acrongenomics entered into a share exchange
agreement with Vardisto Investments Limited (Vardisto), a private Cyprus
company. Pursuant to the share exchange agreement we agreed, among other things,
to acquire 60%, a total outstanding share capital or 600 shares of common stock
of Vardisto in exchange for the issuance of 9,000,000 shares of our common
stock.

Vardistos main asset is its interest in Halldale Ventures
Limited (Halldale). Halldale, is a private Cyprus company in which Vardisto
holds an 80% interest.

Effective January 30, 2009, Halldale entered into an asset
purchase agreement with Maragrita Hadzopoulou-Cladaras. Pursurant to the asset
purchase agreement, Halldale agreed, among other things, to acquire certain
assets comprised mainly of intellectual property and certain research materials
from Ms. Hadzopoulou-Cladaras in exchange for 20% of its issued and outstanding
shares of common stock.

The assets purchased by Halldale pursuant to the asset purchase
agreement include research materials and experimental results from the use of a
compound referred to as compound X as an hypolipidemic agent and development
of a cholesterol-lowering agent, in combination with essential oil derived from
plants.

The share exchange agreement is conditional upon certain events
occurring and there is no assurance that the share exchange agreement will
close.

Cash Requirements

We have not generated any revenues and our operating activities
have resulted in a loss of $3,022,005 for the year ended December 31, 2008. This
negative cash flow is attributable to our operating expenses, including but not
limited to, research and development expense, general and administration and the
payment of our audit fees and legal fees. We anticipate that our expenses will
increase as we intend to focus on the development of our new project with
Vardisto. We estimate our expenses in the next 12 months will be approximately
$1,800,000, generally falling in four major categories: research and
development, general and administrative expenses, investor relations and
professional fees.

---

- 16 -

We estimate our operating expenses and working capital
requirements for the next 12 months to be as follows:

Expense
    
    AmountResearch & Development
    $
    500,000General & Administrative
    $
    600,000Investor Relations
    $
    400,000Professional fees
    $
    300,000$
    1,800,000


Research & Development will include our contributions to
the research and development of the potential cholesterol-lowering agent that is
currently in development by the subsidiary of the subsidiary that we intend to
acquire. If we do not acquire that subsidiary, then we intend to seek out and
acquire another, as yet unknown, technology and to spend approximately this
amount on its research and development.

General & Administrative will include office rent,
utilities, communication, office equipment and supplies, banking fees,
insurance, corporate materials, accounting and temporary office assistance.

Investor Relations will include the costs of paying for
investor relations representatives, press releases, advertizing, and travel
expenses related to promoting the company.

Professional fees will include all payments to our outsourced
attorney and independent auditor

As of December 31, 2008, we had approximately $22,000 in cash.
We do not have enough money to pay for our estimated operating expenses for the
next 12 months. To obtain that money, we may sell shares in our equity
securities or take on debt.

The recent weakening of economic conditions in the U.S. and
around the world could have harmful effects on our ability to raise money to
fund our planned operations.

We believe that recent decreases in value of the common shares
of many companies worldwide will make selling shares of our common stock
increasingly difficult. If we are not able to sell enough of our shares to meet
our financial needs, we will have to consider borrowing the money we need. A
tightening of credit conditions has also been experienced in the economy
recently. Because of the recent credit crisis, it is possible that we would not
be able to borrow adequate amounts to fund our operations on terms and at rates
of interest we find acceptable and in the best interests of our company. If we
are unable to obtain the amount of money that we need to fund our operations,
then we will likely go out of business and investors will lose their entire
investment in our company.

We do not expect that the difficult economic conditions are
likely to improve significantly in the near future. Further deterioration of the
economy, and even consumer fear that the economy will deteriorate further could
intensify the adverse effects of these difficult market conditions.

Purchase of Significant Equipment

We do not intend to purchase any significant equipment.

Personnel Plan

We currently employ two executive officers, which are on an
employment contract and one consulting agreement.

General Administration

We anticipate spending approximately $600,000 on general and
administration costs in the next 12 months. These costs will consist primarily
travel, office, rent and consulting fees.

---

- 17 -

Off-Balance Sheet Arrangements

We have no 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 that is material to
stockholders.

Liquidity and Capital Resources

Our financial condition for the years ended December 31, 2008
and 2007 and the changes between those periods for the respective items are
summarized as follows:

Working CapitalDecember 31, 2008
    
    
    December 31, 2007Current Assets
    $
    39,662
    
    $
    365,975Current Liabilities
    
    906,101
    
    
    1,614,170Working Capital (deficit)
    $
    (866,439
    )
    $
    (1,248,195
    )


The reduction in our working capital (deficit) of $381,759 was
primarily due to repayment of our accounts payables from funds raised through
private placements during the year.

Cash Flows

|                                                      |   | Year Ended   |   |   | Year Ended   |  
|----------------------------------------------------- | - | ------------ | - | - | ------------ | -
|                                                      |   | December 31, |   |   | December 31, |  
|                                                      |   | 2008         |   |   | 2007         |  
|Net cash used in Operating Activities                 | $ | (1,307,390   | ) | $ | (2,290,279   | )
|Net cash used in Investing Activities                 |   | (947,845     | ) |   | -            |  
|Net cash provided by Financing Activities             |   | 1,933,584    |   |   | 2,629,422    |  
|Change in Cash and Cash Equivalents During the Period | $ | (321,651     | ) | $ | 339,143      |  

Cash Used In Operating Activities

During the year ended December 31, 2008 we used net cash in
operating activities in the amount of $1,307,390 primarily towards general and
administrative expenses as well as a net change in prepaid expenses of $4,662
and a net change in accounts payable and accrued liabilities of $105,410.

Cash Used In Investing Activities

During the year ended December 31, 2008, we acquired an
approximately 10.9% interest in Molecular Vision for $1,097,639 and as a result
of our termination agreement with Molecular Vision in August 2009, we received a
cash refund in the amount of $149,794 for net cash used in investing activities
for the year ended December 31, 2008 of $947,845

Cash from Financing Activities

We received net cash from financing activities during the year
  ended December 31, 2008. Net cash generated by financing activities is attributable
  to cash received from common share issuances totaling $1,509,648, common stock
  subscriptions totaling $29,800 and from the issuance of convertible notes totaling
  $694,136 as well as a repayment of one our issued promissory notes in the amount
  of $300,000 for net cash from financing activities totaling $1,933,584.

---

- 18 -

Results of Operations

The following summary of our results of operations should be
read in conjunction with our audited financial statements for the year ended
December 31, 2008 which are included herein.

Our operating results for the year ended December 31, 2008 and
2007 are described below.

Revenue

We have not earned any revenues since our inception and we do
not anticipate earning revenues until such time as we have begun commercial
production or royalties from our investment with Molecular Vision.

Expenses

Our expenses for the 12 months ended December 31, 2008 and 2007
were as follows:

Year Ended
    
    
    Year EndedDecember 31, 2008
    
    
    December 31, 2007Accounting and audit fees
    
    187,481
    
    
    93,490Bank charges
    
    4,052
    
    
    5,027Consulting fees
    
    759,164
    
    
    644,905Interest on notes payable
    
    506,477
    
    
    -Legal fees
    
    89,614
    
    
    23,831Management fees
    
    605,681
    
    
    2,119,505Office and miscellaneous
    
    37,370
    
    
    43,964Public relations and donation
    
    5,102
    
    
    27,387Rent
    
    59,538
    
    
    12,765Research and development
    
    648,407
    
    
    1,871,890Transfer agent and filing
      fees
    
    6,363
    
    
    5,821Travel
    
    120,539
    
    
    212,160(3,029,788
    )
    
    (5,060,745
    )


Operating expenses for the 12 months ended December 31, 2008
decreased by $2,030,957 compared to the same period in 2007 largely due to a
decrease in stock-based compensation, a decrease in management fees (primarily
resulting from a reduction of stock-based compensation) and a decrease of
Research and Development resulting from the change in our relationship with
Molecular Vision in 2008 to one of investor.

Accounting and Audit Fees

Increased by $93,991in the year ended December 31, 2008
compared to the year ended December 31, 2007. This was the result of our Company
the services of an accounting firm to assist us with the preparation of our
books and records as well the preparation of our interim quarterly financial
statements.

Consulting fees

The consulting fees we paid increased in the year ended
December 31, 2008 compared to the year ended December 31, 2007 due to engaging
the services of 2 additional consultants during the year.

Interest on notes payable

The interest we incurred on notes payable increased in the year
ended December 31, 2008 compared to the year ended December 31, 2007. This was
the result of the Company issuing two convertible notes during the year for
which beneficial conversion features totaling $482,124 were calculated and
accreted to interest expense.

Legal fees

---

- 19 -

Our legal fees increased in the year ended December 31, 2008
compared to the year ended December 31, 2007. This was the result of the Company
engaging the services of our attorney to prepare the various agreements
associated with the termination of our development agreement with Molecular
Vision.

Management fees

Our management fees decreased in the year ended December 31,
2008 compared to the year ended December 31, 2007. This was the result of the
Company granting a significant amount of options in the prior year, the
compensation expense of which was classified as management fees.

Rent

Our rental expenses increased in the year ended December 31,
2008 compared to the year ended December 31, 2007. This was the result of
signing a new rental agreement for premises in Athens, Greece.

Research and development

Our expenditures on research and development were $648,407 in
the year ended December 31, 2008 compared to $1,871,890 in the year ended
December 31, 2007. This was the result of our no longer paying for the research
and development of the BioLED technology upon the termination of our development
agreement with them.

Going Concern

We have historically incurred losses and have incurred a loss
of $3,022,005 for the year ended December 31, 2008. Because of these historical
losses, we will require additional working capital to develop our business
operations. We intend to raise additional working capital through private
placements, public offerings, bank financing and/or advances from related
parties or shareholder loans.

The continuation of our business is dependent upon obtaining
further financing and achieving a break even or profitable level of operations.
The issuance of additional equity securities by us could result in a significant
dilution in the equity interests of our current or future stockholders.
Obtaining commercial loans, assuming those loans would be available, will
increase our liabilities and future cash commitments.

There are no assurances that we will be able to either (i)
achieve a level of revenues adequate to generate sufficient cash flow from
operations; or (ii) obtain additional financing through either private
placements, public offerings and/or bank financing necessary to support our
working capital requirements. To the extent that funds generated from operations
and any private placements, public offerings and/or bank financing are
insufficient, we will have to raise additional working capital. No assurance can
be given that additional financing will be available, or if available, will be
on terms acceptable to us. If adequate working capital is not available we may
cease operations.

These conditions raise substantial doubt about our ability to
continue as a going concern. The financial statements do not include any
adjustments relating to the recoverability and classification of asset carrying
amounts or the amount and classification of liabilities that might be necessary
should we be unable to continue as a going concern.

Application of Critical Accounting Policies

Our financial statements and accompanying notes are prepared in
accordance with generally accepted accounting principles in the United States.
Preparing financial statements requires management to make estimates and
assumptions that affect the reported amounts of assets, liabilities, revenue and
expenses. These estimates and assumptions are affected by managements
application of accounting policies. We believe that understanding the basis and
nature of the estimates and assumptions involved with the following aspects of
our financial statements is critical to an understanding of our financials.

We base our assumptions and estimates on historical experience
and other sources that we believe to be reasonable at the time. Actual results
may vary from our estimates due to changes in circumstances, weather, politics,
global

---

- 20 -

economics, mechanical problems, general business conditions and
other factors. Our significant estimates are related to the valuation of
warrants and options.

There are accounting policies that we believe are significant
to the presentation of our financial statements. The most significant of these
accounting policies relates to the valuation of intellectual property, the
accounting for our research and development expenses and stock-based
compensation expense.

Investment in Molecular Vision Ltd.

We have made an equity investment in Molecular Vision Ltd., a
privately held company incorporated in Great Britain and whose business is
complementary to the Companys business. This investment is accounted for under
the cost method of accounting, as the Company held less than 20% of the voting
stock outstanding and did not exert significant influence over this company. We
assess the recoverability of this investment by reviewing various indicators of
impairment and by determining the fair value of this investment by performing a
discounted cash flow analysis of estimated future cash flows. We record an
impairment of this investment when a decline in value is determined to be
other-than-temporary.

Stock-based Compensation

We account for all of our stock-based payments and awards under
the fair value based method.

Stock-based payments to non-employees are measured at the fair
value of the consideration received, or the fair value of the equity instruments
issued, or liabilities incurred, whichever is more reliably measurable. The fair
value of stock-based payments to non-employees is periodically re-measured until
the counterparty performance is complete, and any change therein is recognized
over the vesting period of the award and in the same manner as if the Company
had paid cash instead of paying with or using equity based instruments. The cost
of the stock-based payments to non-employees that are fully vested and
non-forfeitable as at the grant date is measured and recognized at that date,
unless there is a contractual term for services in which case such compensation
would be amortized over the contractual term.

We account for the granting of share purchase options to
employees using the fair value method whereby all awards to employees will be
recorded at fair value on the date of the grant. Share based awards granted to
employees with a performance condition are measured based on the probable
outcome of that performance condition during the requisite service period. We
assess the probability of any performance condition being achieved we accrue the
value of the award if it is probable that a performance condition will be
achieved. Compensation costs for stock-based payments to employees that do not
include performance conditions are recognized on a straight-line basis. The fair
value of all share purchase options are expensed over their vesting period with
a corresponding increase to additional capital surplus. Upon exercise of share
purchase options, the consideration paid by the option holder, together with the
amount previously recognized in additional capital surplus, is recorded as an
increase to share capital.

We use the Black-Scholes option valuation model to calculate
the fair value of share purchase options at the date of the grant. Option
pricing models require the input of highly subjective assumptions, including the
expected price volatility. As allowed by SFAS No. 123R for companies with a
short period of publicly traded stock history, our estimate of expected
volatility is based on the average expected volatilities of a sampling of ten
companies with similar attributes to us, including industry, stage of life
cycle, size and financial leverage. We use the simplified method for
determining the expected life of the options granted as permitted under the
SECs Staff Accounting Bulletin No. 110 (SAB 110), which will allow a company to
continue to use the simplified method under certain circumstances. SFAS No.
123R does not allow companies to account for option forfeitures as they occur.
Instead, estimated option forfeitures must be calculated upfront to reduce the
option expense to be recognized over the life of the award and updated upon the
receipt of further information as to the amount of options expected to be
forfeited.

Recent accounting pronouncements

On September 15, 2006, FASB issued Statement No. 157, Fair
Value Measurements (SFAS No. 157). SFAS No. 157 provides guidance for using
fair value to measure assets and liabilities. SFAS No. 157 references fair value

---

- 21 -

as the price that would be received to sell an asset or paid to
transfer a liability in an orderly transaction between market participants in
the market in which the reporting entity transacts. SFAS No. 157 applies
whenever other standards require (or permit) assets or liabilities to be
measured at fair value. SFAS No. 157 does not expand the use of fair value in
any new circumstances. Originally, SFAS No. 157 was effective for financial
statements issued for fiscal years beginning after November 15, 2007, and
interim periods within those fiscal years. Accordingly, we adopted SFAS No. 157
in the first quarter of fiscal year 2008. In February 2008, the FASB issued FASB
Staff Position No. 157-2, Effective Date of FASB Statement No. 157, which
provides a one year deferral of the effective date of SFAS No. 157 for
non-financial assets and non-financial liabilities, except those that are
recognized or disclosed in the financial statements at fair value at least
annually. Therefore, we have adopted the provisions of SFAS No. 157 with respect
to its financial assets and liabilities only for the year ended December 31,
2008.

Effective January 1, 2008, we adopted Statement of Financial
Accounting Standard (SFAS) No. 159, The Fair Value Option for Financial Assets
and Financial Liabilities-Including an amendment of FASB Statement No. 115. SFAS
No. 159 gives the Companys managment the irrevocable option to elect fair value
for the initial and subsequent measurement for certain financial assets and
liabilities on a contract-by-contract basis with the difference between the
carrying value before election of the fair value option and the fair value
recorded upon election as an adjustment to beginning retained earnings. As of
December 31, 2008, we had not elected the fair value option for any eligible
financial asset or liability.

In June 2007, the Emerging Issues Task Force (EITF) reached a
consensus on EITF No. 07-03, Accounting for Non-refundable Advance Payments for
Goods or Services to Be Used in Future Research and Development Activities
(EITF 07-03). EITF 07-03 specifies the timing of expense recognition for
non-refundable advance payments for goods or services that will be used or
rendered for research and development activities. EITF 07-03 was effective for
fiscal years beginning after December 15, 2007. The adoption of EITF 07-03 did
not have a material impact on our financial position and results of
operations.

In December 2007, FASB issued Statement No. 141 (Revised 2007),
Business Combinations (SFAS 141(R)) and SFAS No. 160, Accounting and Reporting
of Non-controlling Interests in Consolidated Financial Statements, an amendment
of ARB No. 51 (SFAS 160). SFAS 141(R) requires companies to: (i) recognize,
with certain exceptions, 100% of the fair values of assets acquired, liabilities
assumed, and non-controlling interests in acquisitions of less than a 100%
controlling interest when the acquisition constitutes a change in control of the
acquired entity; (ii) measure acquirer shares issued in consideration for a
business combination at fair value on the acquisition date; (iii) recognize
contingent consideration arrangements at their acquisition-date fair values,
with subsequent changes in fair value generally reflected in earnings; (iv) with
certain exceptions, recognize pre-acquisition loss and gain contingencies at
their acquisition-date fair values; (v) capitalize in-process research and
development (IPR&D) assets acquired; (vi) expense, as incurred,
acquisition-related transaction costs; (vii) capitalize acquisition-related
restructuring costs only if the criteria in SFAS No. 146, Accounting for Costs
Associated with Exit or Disposal Activities , are met as of the acquisition
date; and (viii) recognize changes that result from a business combination
transaction in an acquirers existing income tax valuation allowances and tax
uncertainty accruals as adjustments to income tax expense. SFAS 141(R) is
required to be adopted concurrently with SFAS 160 and is effective for business
combination transactions for which the acquisition date is on or after the
beginning of the first annual reporting period beginning on or after December
15, 2008. Early adoption of these statements is prohibited. We do not believe
the adoption of these statements will have a material impact on significant
acquisitions completed after January 1, 2009.

In December 2007, the Emerging Issues Task Force (EITF)
reached a consensus on EITF No. 07-01, Accounting for Collaborative Arrangements
Related to the Development and Commercialization of Intellectual Property (EITF
07-01). EITF 07-01 discusses the appropriate income statement presentation and
classification for the activities and payments between the participants in
arrangements related to the development and commercialization of intellectual
property. The sufficiency of disclosure related to these arrangements is also
specified. EITF 07-01 is effective for fiscal years beginning after December 15,
2008. As a result, EITF 07-01 was effective as of January 1, 2009. We expect
that the adoption of EITF 07-01 will have minimal, if any, impact on its
financial position and results of operations. However, based upon the nature of
our business, EITF 07-01 could have a material impact on its financial position
and results of operations in future years.

---

- 22 -

In April 2008, the FASB issued FSP 142-3, Determination of the
Useful Life of Intangible Assets. This FSP amends the factors that should be
considered in developing renewal or extension assumptions used to determine the
useful life of a recognized intangible asset under FASB Statement No. 142,
Goodwill and Other Intangible Assets. The intent of this FSP is to improve the
consistency between the useful life of a recognized intangible asset under
Statement 142 and the period of expected cash flows used to measure the fair
value of the asset under FASB Statement No. 141 (Revised 2007), Business
Combinations, and other U.S. generally accepted accounting principles (GAAP).
This FSP is effective for financial statements issued for fiscal years beginning
after December 15, 2008, and interim periods within those fiscal years. Early
adoption is prohibited. We do not expect the adoption of FAS 142-3 to have a
material effect on its results of operations and financial condition.

In May 2008, FASB issued SFAS No. 162, The Hierarchy of
Generally Accepted Accounting Principles (SFAS 162). This standard is intended
to improve financial reporting by identifying a consistent framework, or
hierarchy, for selecting accounting principles to be used in preparing financial
statements that are presented in conformity with U.S. GAAP for non-governmental
entities. SFAS No. 162 is effective 60 days following the U.S. Securities and
Exchange Commissions approval of the Public Company Accounting Oversight Board
amendments to AU Section 411, the meaning of Present Fairly in Conformity with
GAAP. We are in the process of evaluating the impact, if any, of SFAS 162 on
our financial statements.

In May 2008, the FASB issued FSP No. APB 14-1, Accounting for
Convertible Debt Instruments That May Be Settled in Cash upon Conversion
(Including Partial Cash Settlement) (FSP APB 14-1). FSP APB 14-1 applies to
convertible debt instruments that, by their stated terms, may be settled in cash
(or other assets) upon conversion, including partial cash settlement, unless the
embedded conversion option is required to be separately accounted for as a
derivative under SFAS 133. Convertible debt instruments within the scope of FSP
APB 14-1 are not addressed by the existing APB 14. FSP APB 14-1 requires that
the liability and equity components of convertible debt instruments within the
scope of FSP APB 14-1 be separately accounted for in a manner that reflects the
entitys nonconvertible debt borrowing rate. This requires an allocation of the
convertible debt proceeds between the liability component and the embedded
conversion option (i.e., the equity component). The difference between the
principal amount of the debt and the amount of the proceeds allocated to the
liability component will be reported as a debt discount and subsequently
amortized to earnings over the instruments expected life using the effective
interest method. FSP APB 14-1 is effective for the fiscal year beginning January
1, 2009 and will be applied retrospectively to all periods presented. We are
currently evaluating the effects of adopting FSP APB 14-1.

In June 2008, the FASB reached consensus on EITF Issue No.
07-05 (EITF 07-05), Determining Whether an Instrument (or embedded feature)
Is Indexed to an Entitys Own Stock. EITF 07-05 clarifies the determination of
whether an instrument (or an embedded feature) is indexed to an entitys own
stock, which would qualify as a scope exception under SFAS 133. EITF 07-05 is
effective for financial statements issued for fiscal years beginning after
December 15, 2008. Early adoption of EITF 07-05 is not permitted. We do not
believe the adoption of EITF 07-05 will have a material impact on our financial
position, results of operations or cash flows.

ITEM 7A QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT
MARKET RISK

Not Applicable

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

---

- 23 -







ACRONGENOMICS, INC.

(A Development Stage Company)

FINANCIAL STATEMENTS

December 31, 2008 and 2007

(Stated in US Dollars)

---

|                      | BDO DunwoodyLLP                     | 600 Cathedral Place
|--------------------- | ----------------------------------- | -------------------
|Chartered Accountants | 925 West Georgia Street            
|                      | Vancouver, BC, Canada V6C
      3L2
|                      | Telephone: (604) 688-5421          
|                      | Telefax: (604) 688-5132            
|                      | E-mail: vancouver@bdo.ca           
|                      |                                     | www.bdo.ca         

REPORT OF INDEPENDENT REGISTERED PUBLIC
  ACCOUNTING FIRM

To the Stockholders, 
  Acrongenomics, Inc. 
  (A Development
  Stage Company)

We have audited the accompanying balance sheets of
  Acrongenomics, Inc. (the Company, a Development Stage Company) as of December
  31, 2008 and 2007 and the related statements of operations, cash flows and
  capital deficit for the years then ended and for the period from August 17, 1999
  (Date of Inception) to December 31, 2008. These financial statements are the
  responsibility of the Company's management. Our responsibility is to express an
  opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the
  Public Company Accounting Oversight Board (United States). Those standards
  require that we plan and perform an audit to obtain reasonable assurance about
  whether the financial statements are free of material misstatement. The Company
  is not required to have, nor were we engaged to perform, an audit of its
  internal control over financial reporting. Our audits included consideration of
  internal control over financial reporting as a basis for designing audit
  procedures that are appropriate in the circumstances, but not for the purpose of
  expressing an opinion on the effectiveness of the Companys internal control
  over financial reporting. Accordingly, we express no such opinion. An audit also
  includes examining, on a test basis, evidence supporting the amounts and
  disclosures in the financial statements, assessing the accounting principles
  used and significant estimates made by management, as well as evaluating the
  overall financial statement presentation. We believe that our audits provide a
  reasonable basis for our opinion.

In our opinion, these financial statements referred to above
  present fairly, in all material respects, the financial position of
  Acrongenomics, Inc. as of December 31, 2008 and 2007 and the results of its
  operations and its cash flows for the years then ended and for the period from
  August 17, 1999 (Date of Inception) to December 31, 2008, in conformity with
  accounting principles generally accepted in the United States of America.

The accompanying financial statements referred to above have
  been prepared assuming that the Company will continue as a going concern. As
  discussed in Note 1 to the financial statements, the Company is in the
  development stage, has not yet achieved profitable operations and is dependent
  on its ability to raise capital from shareholders or other sources to meet its
  obligations and repay its liabilities arising from normal business operations
  when they come due. These factors, along with other matters as set forth in Note
  1, raise substantial doubt that the Company will be able to continue as a going
  concern. The financial statements do not include any adjustments that might
  result from the outcome of these uncertainties.

/s/ BDO Dunwoody LLP

Chartered Accountants

Vancouver, Canada 
  April 13, 2009





BDO DunwoodyLLP is a Limited Liability Partnership
  registered in Ontario

---

ACRONGENOMICS, INC.(A Development Stage Company) 
  BALANCE SHEETS 
  December 31, 2008 and 2007 
  (Stated in US
    Dollars)

|                                                                              |   | 2008        |   |   | 2007        |  
|----------------------------------------------------------------------------- | - | ----------- | - | - | ----------- | -
|**ASSETS**                                                                    |  
|                                                                              |   |             |   |   |             |  
|Current                                                                       |   |             |   |   |             |  
|Cash                                                                          | $ | 22,044      |   | $ | 343,695     |  
|Prepaid expenses and deposit                                                  |   | 17,618      |   |   | 22,280      |  
|                                                                              |   |             |   |   |             |  
|                                                                              |   | 39,662      |   |   | 365,975     |  
|Investment in Molecular Vision Ltd.  Note 3                                  |   | 791,230     |   |   | -           |  
|                                                                              |   |             |   |   |             |  
|                                                                              | $ | 830,892     |   | $ | 365,975     |  
|                                                                              |   |             |   |   |             |  
|LIABILITIES                                                                   |  
|                                                                              |   |             |   |   |             |  
|Current                                                                       |   |             |   |   |             |  
|Accounts payable and accrued
      liabilities Notes 3 and 7                 | $ | 510,965     |   | $ | 1,613,170   |  
|Convertible promissory notes payable 
      Note 5                           |   | 394,136     |   |   | -           |  
|Loans payable  Note
      6                                                  |   | 1,000       |   |   | 1,000       |  
|                                                                              |   |             |   |   |             |  
|                                                                              |   | 906,101     |   |   | 1,614,170   |  
|                                                                              |   |             |   |   |             |  
|STOCKHOLDERS DEFICIENCY                                                      |  
|                                                                              |   |             |   |   |             |  
|Common stock, $0.001 par value  Notes
      8 and 12                         |   |             |   |   |             |  
|100,000,000 shares authorized                                                 |   |             |   |   |             |  
|23,906,731
      shares issued (2007: 17,866,471)                             |   | 23,906      |   |   | 17,866      |  
|Additional paid-in capital                                                    |   | 26,507,207  |   |   | 22,348,056  |  
|Shares subscriptions (receivable)  Note
      8                              |   | 26,500      |   |   | (3,300      | )
|Deficit accumulated during the development stage                              |   | (26,632,822 | ) |   | (23,610,817 | )
|                                                                              |   |             |   |   |             |  
|                                                                              |   | (75,209     | ) |   | (1,248,195  | )
|                                                                              |   |             |   |   |             |  
|                                                                              | $ | 830,892     |   | $ | 365,975     |  
|                                                                              |   |             |   |   |             |  
|                                                                              |   |             |   |   |             |  
|Nature of Operations and Ability to Continue
      as a Going Concern Note 1 |   |             |   |   |             |  
|Commitments  Notes 8 and 11                                                  |   |             |   |   |             |  
|Contingencies  Note 12                                                       |   |             |   |   |             |  
|Subsequent Events  Notes 8 and 13                                            |   |             |   |   |             |  

SEE ACCOMPANYING NOTES

---

ACRONGENOMICS, INC.(A Development Stage Company) 
  STATEMENTS OF OPERATIONS 
  for the years ended December 31, 2008 and 2007
  and 
  for the period August 17, 1999 (Date of Inception) to December 31, 2008 
  (Stated in US Dollars)

|                                                              |   |            |   |   |            |   |   | August 17,    |  
|------------------------------------------------------------- | - | ---------- | - | - | ---------- | - | - | ------------- | -
|                                                              |   |            |   |   |            |   |   | 1999 (Date of |  
|                                                              |   |            |   |   |            |   |   | Inception) to |  
|                                                              |   |            |   |   |            |   |   | December 31,  |  
|                                                              |   | 2008       |   |   | 2007       |   |   | 2008          |  
|                                                              |   |            |   |   |            |   |   |               |  
|                                                              |   |            |   |   |            |   |   |               |  
|Expenses                                                      |   |            |   |   |            |   |   |               |  
|Accounting and audit fees  Note 7                            | $ | 187,481    |   | $ | 93,490     |   | $ | 570,834       |  
|Amortization of patents                                       |   | -          |   |   | -          |   |   | 741,430       |  
|Appraisals                                                    |   | -          |   |   | -          |   |   | 14,500        |  
|Bank charges                                                  |   | 4,052      |   |   | 5,027      |   |   | 16,734        |  
|Consulting fees  Note 7                                      |   | 759,164    |   |   | 644,905    |   |   | 2,601,068     |  
|Legal fees - Note 7                                           |   | 89,614     |   |   | 23,831     |   |   | 345,609       |  
|Interest and accretion on notes payable
       Notes 5 and 7 |   | 506,477    |   |   | -          |   |   | 506,477       |  
|Management fees  Note
      7                                |   | 605,681    |   |   | 2,119,505  |   |   | 3,314,859     |  
|Office and miscellaneous                                      |   | 37,370     |   |   | 43,964     |   |   | 136,095       |  
|Public relations and
      donation                           |   | 5,102      |   |   | 27,387     |   |   | 579,496       |  
|Rent - Note 7                                                 |   | 59,538     |   |   | 12,765     |   |   | 108,303       |  
|Research and
      development  Notes 3 and 7                |   | 648,407    |   |   | 1,871,890  |   |   | 9,202,266     |  
|Transfer agent and filing fees                                |   | 6,363      |   |   | 5,821      |   |   | 32,693        |  
|Travel                                                        |   | 120,539    |   |   | 212,160    |   |   | 451,608       |  
|Write-down of patents                                         |   | -          |   |   | -          |   |   | 8,004,447     |  
|                                                              |   |            |   |   |            |   |   |               |  
|Operating loss                                                |   | (3,029,788 | ) |   | (5,060,745 | ) |   | (26,626,419   | )
|                                                              |   |            |   |   |            |   |   |               |  
|Interest income                                               |   | 202        |   |   | 495        |   |   | 23,140        |  
|Foreign exchange gain
      (loss)                            |   | 7,581      |   |   | 4,133      |   |   | 12,455        |  
|                                                              |   |            |   |   |            |   |   |               |  
|Loss from continuing operations                               |   | (3,022,005 | ) |   | (2,480,288 | ) |   | (26,590,824   | )
|Loss from discontinued operations                             |   | -          |   |   | -          |   |   | (41,998       | )
|                                                              |   |            |   |   |            |   |   |               |  
|Net loss for the period                                       | $ | (3,022,005 | ) | $ | (5,056,117 | ) | $ | (26,632,822   | )
|                                                              |   |            |   |   |            |   |   |               |  
|Basic and diluted loss per share                              | $ | (0.14      | ) | $ | (0.32      | ) |   |               |  
|                                                              |   |            |   |   |            |   |   |               |  
|Weighted average shares outstanding                           |   | 21,203,764 |   |   | 15,794,532 |   |   |               |  

SEE ACCOMPANYING NOTES

---

ACRONGENOMICS, INC.(A Development Stage
  Company) 
  STATEMENTS OF CASH FLOWS 
  for the years ended December 31, 2008
  and 2007 and 
  for the period August 17, 1999 (Date of Inception) to December
  31, 2008 
  (Stated in US Dollars)

|                                                          |   |            |   |   |            |   |   | August 17,    |  
|--------------------------------------------------------- | - | ---------- | - | - | ---------- | - | - | ------------- | -
|                                                          |   |            |   |   |            |   |   | 1999 (Date of |  
|                                                          |   |            |   |   |            |   |   | Inception) to |  
|                                                          |   |            |   |   |            |   |   | December 31,  |  
|                                                          |   | 2008       |   |   | 2007       |   |   | 2008          |  
|Cash Flows used in Operating Activities                   |   |            |   |   |            |   |   |               |  
|Net loss for the period                                   | $ | (3,022,005 | ) | $ | (5,056,117 | ) | $ | (26,632,822   | )
|Items not affecting
      cash:                           |   |            |   |   |            |   |   |               |  
|Amortization                                              |   | -          |   |   | -          |   |   | 741,430       |  
|Accretion of debt discount                                |   | 482,124    |   |   | -          |   |   | 482,124       |  
|Shares issued for
      consulting and management fees    |   | 667,500    |   |   | 645,000    |   |   | 1,312,500     |  
|Stock-based compensation                                  |   | 454,919    |   |   | 533,252    |   |   | 1,881,844     |  
|Write-down of
      patents                               |   | -          |   |   | -          |   |   | 8,004,447     |  
|Changes in non-cash
      working capital items:          |   |            |   |   |            |   |   |               |  
|Prepaid expenses
      and deposit                        |   | 4,662      |   |   | (22,280    | ) |   | (17,618       | )
|Accounts payable and accrued liabilities                  |   | 105,410    |   |   | 1,609,866  |   |   | 2,344,580     |  
|                                                          |   |            |   |   |            |   |   |               |  
|Net cash used in operating activities                     |   | (1,307,390 | ) |   | (2,290,279 | ) |   | (11,883,515   | )
|                                                          |   |            |   |   |            |   |   |               |  
|Cash Flows used in Investing Activity                     |   |            |   |   |            |   |   |               |  
|Investment in Molecular Vision                            |   | (1,097,639 | ) |   | -          |   |   | (1,097,639    | )
|Refund on termination
      of development agreement with |   |            |   |   |            |   |   |               |  
|Molecular Vision                                          |   | 149,794    |   |   |            |   |   | 149,794       |  
|Patents                                                   |   | -          |   |   | -          |   |   | (121,877      | )
|                                                          |   |            |   |   |            |   |   |               |  
|Net cash used in Investing Activities                     |   | (947,845   | ) |   | -          |   |   | (1,069,722    | )
|                                                          |   |            |   |   |            |   |   |               |  
|Cash Flows provided by Financing Activities               |   |            |   |   |            |   |   |               |  
|Common stock issued for cash                              |   | 1,509,648  |   |   | 2,656,695  |   |   | 12,180,038    |  
|Stock purchase warrants                                   |   | -          |   |   | -          |   |   | 370,307       |  
|Common stock subscriptions                                |   | 29,800     |   |   | -          |   |   | 29,800        |  
|Issuance of convertible
      notes                       |   | 694,136    |   |   | -          |   |   | 694,136       |  
|Repayment of convertible note                             |   | (300,000   | ) |   |            |   |   | (300,000      | )
|Increase (decrease) in
      loan payable                 |   | -          |   |   | (27,273    | ) |   | 1,000         |  
|                                                          |   |            |   |   |            |   |   |               |  
|Net cash provided by financing activities                 |   | 1,933,584  |   |   | 2,629,422  |   |   | 12,975,281    |  
|                                                          |   |            |   |   |            |   |   |               |  
|                                                          |   |            |   |   |            |   |   |               |  
|Increase (decrease) in cash during the period             |   | (321,651   | ) |   | 339,143    |   |   | 22,044        |  
|                                                          |   |            |   |   |            |   |   |               |  
|Cash, beginning of period                                 |   | 343,695    |   |   | 4,552      |   |   | -             |  
|                                                          |   |            |   |   |            |   |   |               |  
|Cash, end of period                                       | $ | 22,044     |   | $ | 343,695    |   | $ | 22,044        |  

Supplemental Cash Flow Information  Note 10

SEE ACCOMPANYING NOTES

---

ACRONGENOMICS,INC.(A Development Stage
  Company) 
  STATEMENT OF CHANGES IN CAPITAL DEFICIT 
  for the period August
  17, 1999 (Date of Inception) to December 31, 2008 
  (Stated in US Dollars)

|                                           |             |  |  |            |  |   |              |  |   |            |   |   |               |  |   | Deficit     |   |   |            |  
|------------------------------------------ | ----------- |  |  | ---------- |  | - | ------------ |  | - | ---------- | - | - | ------------- |  | - | ----------- | - | - | ---------- | -
|                                           |             |  |  |            |  |   | Common Stock |  |   |            |   |   |               |  |   | Accumulated |   |   |            |  
|                                           |             |  |  |            |  |   |              |  |   | Additional |   |   | Share         |  |   | During the  |   |   |            |  
|                                           |             |  |  |            |  |   |              |  |   | Paid-in    |   |   | Subscriptions |  |   | Development |   |   |            |  
|                                           |             |  |  | Shares     |  |   | Par Value    |  |   | Capital    |   |   | (Receivable)  |  |   | Stage       |   |   | Total      |  
|                                           |             |  |  |            |  |   |              |  |   |            |   |   |               |  |   |             |   |   |            |  
|Capital stock issued for cash              | - at $0.001 |  |  | 5,000,000  |  | $ | 5,000        |  | $ | -          |   | $ | -             |  | $ | -           |   | $ | 5,000      |  
|                                           | - at $0.01  |  |  | 5,000,000  |  |   | 5,000        |  |   | 45,000     |   |   | -             |  |   |             |   |   | 50,000     |  
|Net loss for the period                    |             |  |  | -          |  |   | -            |  |   | -          |   |   | -             |  |   | (2,116      | ) |   | (2,116     | )
|Balance, December 31, 1999                 |             |  |  | 10,000,000 |  |   | 10,000       |  |   | 45,000     |   |   | -             |  |   | (2,116      | ) |   | 52,884     |  
|Capital stock issued for cash              | - at $0.20  |  |  | 100,000    |  |   | 100          |  |   | 19,900     |   |   | -             |  |   | -           |   |   | 20,000     |  
|Net loss for the year                      |             |  |  | -          |  |   | -            |  |   | -          |   |   | -             |  |   | (8,176      | ) |   | (8,176     | )
|Balance, December 31, 2000                 |             |  |  | 10,100,000 |  |   | 10,100       |  |   | 64,900     |   |   | -             |  |   | (10,292     | ) |   | 64,708     |  
|Net loss for the year                      |             |  |  | -          |  |   | -            |  |   | -          |   |   | -             |  |   | (205        | ) |   | (205       | )
|                                           |             |  |  |            |  |   |              |  |   |            |   |   |               |  |   |             |   |   |            |  
|Balance, December 31, 2001                 |             |  |  | 10,100,000 |  |   | 10,100       |  |   | 64,900     |   |   | -             |  |   | (10,497     | ) |   | 64,503     |  
|Capital stock issued for cash              | - at $0.20  |  |  | 15,000     |  |   | 15           |  |   | 2,985      |   |   | -             |  |   | -           |   |   | 3,000      |  
|Net loss for the year                      |             |  |  | -          |  |   | -            |  |   | -          |   |   | -             |  |   | (24,818     | ) |   | (24,818    | )
|Balance, December 31, 2002                 |             |  |  | 10,115,000 |  |   | 10,115       |  |   | 67,885     |   |   | -             |  |   | (35,315     | ) |   | 42,685     |  
|Net loss for the year                      |             |  |  | -          |  |   | -            |  |   | -          |   |   | -             |  |   | (21,576     | ) |   | (21,576    | )
|Balance, December 31, 2003                 |             |  |  | 10,115,000 |  |   | 10,115       |  |   | 67,885     |   |   | -             |  |   | (56,891     | ) |   | 21,109     |  
|Pursuant to the acquisition of patent      | - at $1.96  |  |  | 4,000,000  |  |   | 4,000        |  |   | 7,836,000  |   |   | -             |  |   | -           |   |   | 7,840,000  |  
|Capital stock issued for patent commission | - at $1.96  |  |  | 400,000    |  |   | 400          |  |   | 783,600    |   |   | -             |  |   | -           |   |   | 784,000    |  
|Capital stock issued for cash              | - at $1.00  |  |  | 420,000    |  |   | 420          |  |   | 419,580    |   |   | -             |  |   | -           |   |   | 420,000    |  
|Capital stock issued for commission        | - at $1.00  |  |  | 42,000     |  |   | 42           |  |   | 41,958     |   |   | -             |  |   | -           |   |   | 42,000     |  
|Less: commission                           |             |  |  | -          |  |   | -            |  |   | (42,000    | ) |   | -             |  |   | -           |   |   | (42,000    | )
|commission                                 |             |  |  | -          |  |   | -            |  |   | (35,000    | ) |   | -             |  |   | -           |   |   | (35,000    | )
|Capital stock issued for cash              | - at $2.30  |  |  | 537,956    |  |   | 538          |  |   | 1,236,761  |   |   | -             |  |   | -           |   |   | 1,237,299  |  
|Capital stock issued for commission        |             |  |  | 50,594     |  |   | 50           |  |   | 116,316    |   |   | -             |  |   | -           |   |   | 116,366    |  
|Less: commission                           |             |  |  | -          |  |   | -            |  |   | (116,366   | ) |   | -             |  |   | -           |   |   | (116,366   | )
|Capital contribution                       |             |  |  | -          |  |   | -            |  |   | 6,000      |   |   | -             |  |   | -           |   |   | 6,000      |  
|Stock subscriptions                        |             |  |  | -          |  |   | -            |  |   | -          |   |   | 426,329       |  |   | -           |   |   | 426,329    |  
|Net loss for the year                      |             |  |  | -          |  |   | -            |  |   | -          |   |   | -             |  |   | (1,863,376  | ) |   | (1,863,376 | )
|Balance, December 31, 2004                 |             |  |  | 15,565,550 |  | $ | 15,565       |  | $ | 10,314,734 |   | $ | 426,329       |  | $ | (1,920,267  | ) | $ | 8,836,361  |  

SEE ACCOMPANYING NOTES

---

ACRONGENOMICS,INC.(A Development Stage
  Company) 
  STATEMENT OF CHANGES IN CAPITAL DEFICIT 
  for the period August
  17, 1999 (Date of Inception) to December 31, 2008 
  (Stated in US Dollars)

|                                                            |            |  |   |            |   |   |              |   |   |            |   |   |               |   |   | Deficit     |   |   |             |  
|----------------------------------------------------------- | ---------- |  | - | ---------- | - | - | ------------ | - | - | ---------- | - | - | ------------- | - | - | ----------- | - | - | ----------- | -
|                                                            |            |  |   |            |   |   | Common Stock |   |   |            |   |   |               |   |   | Accumulated |   |   |             |  
|                                                            |            |  |   |            |   |   |              |   |   | Additional |   |   | Share         |   |   | During the  |   |   |             |  
|                                                            |            |  |   |            |   |   |              |   |   | Paid-in    |   |   | Subscriptions |   |   | Development |   |   |             |  
|                                                            |            |  |   | Shares     |   |   | Par Value    |   |   | Capital    |   |   | (Receivable)  |   |   | Stage       |   |   | Total       |  
|Balance, December 31, 2004                                  |            |  | $ | 15,565,550 |   | $ | 15,565       |   | $ | 10,314,734 |   | $ | 426,329       |   | $ | (1,920,267  | ) | $ | 8,836,361   |  
|Capital stock issued for cash                               | - at $2.30 |  |   | 72,500     |   |   | 73           |   |   | 166,677    |   |   | -             |   |   | -           |   |   | 166,750     |  
|                                                            | - at $2.40 |  |   | 108,168    |   |   | 108          |   |   | 259,495    |   |   | -             |   |   | -           |   |   | 259,603     |  
|                                                            | - at $3.50 |  |   | 551,443    |   |   | 551          |   |   | 1,929,499  |   |   | -             |   |   | -           |   |   | 1,930,050   |  
|                                                            | - at $4.00 |  |   | 915,125    |   |   | 915          |   |   | 3,659,585  |   |   | (386,329      | ) |   | -           |   |   | 3,274,171   |  
|Capital stock issued for commission                         | - at $4.00 |  |   | 81,337     |   |   | 82           |   |   | 325,266    |   |   | -             |   |   | -           |   |   | 325,348     |  
|Less: commission                                            |            |  |   | -          |   |   | -            |   |   | (325,348   | ) |   | -             |   |   | -           |   |   | (325,348    | )
|commission                                                  |            |  |   | -          |   |   | -            |   |   | (24,900    | ) |   | -             |   |   | -           |   |   | (24,900     | )
|Capital stock issued for cash pursuant to exercise
      of |            |  |   |            |   |   |              |   |   |            |   |   |               |   |   |             |   |   |             |  
|warrants                                                    | - at $1.00 |  |   | 420,000    |   |   | 420          |   |   | 419,580    |   |   | -             |   |   | -           |   |   | 420,000     |  
|Stock-based compensation                                    |            |  |   | -          |   |   | -            |   |   | 364,000    |   |   | -             |   |   | -           |   |   | 364,000     |  
|Capital stock issued for consulting services                | - at $4.68 |  |   | 100,000    |   |   | 100          |   |   | 467,900    |   |   | -             |   |   | -           |   |   | 468,000     |  
|Net loss from continuing operations                         |            |  |   | -          |   |   | -            |   |   | -          |   |   | -             |   |   | (14,152,210 | ) |   | (14,152,210 | )
|Net loss from discontinued operations                       |            |  |   |            |   |   |              |   |   |            |   |   |               |   |   | (1,935      | ) |   | (1,935      | )
|Capital contribution from subsidiary on disposition         |            |  |   | -          |   |   | -            |   |   | (6,000     | ) |   | -             |   |   | -           |   |   | (6,000      | )
|Balance, December 31, 2005                                  |            |  |   | 17,814,123 |   |   | 17,814       |   |   | 17,550,488 |   |   | 40,000        |   |   | (16,074,412 | ) |   | 1,533,890   |  
|Cancellation of shares                                      |            |  |   | (4,000,000 | ) |   | (4,000       | ) |   | 4,000      |   |   | -             |   |   | -           |   |   | -           |  
|Stock-based compensation                                    |            |  |   | -          |   |   | -            |   |   | 529,673    |   |   | -             |   |   | -           |   |   | 529,673     |  
|Capital stock issued for cash                               | - at $0.75 |  |   | 317,334    |   |   | 317          |   |   | 237,683    |   |   | -             |   |   | -           |   |   | 238,000     |  
|Less: share issue costs                                     |            |  |   | -          |   |   | -            |   |   | (6,300     | ) |   | -             |   |   | -           |   |   | (6,300      | )
|Net loss for the year                                       |            |  |   | -          |   |   | -            |   |   | -          |   |   | -             |   |   | (2,480,288  | ) |   | (2,480,288  | )
|Balance, December 31, 2006                                  |            |  |   | 14,131,457 |   |   | 14,131       |   |   | 18,315,544 |   |   | 40,000        |   |   | (18,554,700 | ) |   | (185,025    | )
|Capital stock issued for cash:                              | - at $0.50 |  |   | 220,000    |   |   | 220          |   |   | 109,780    |   |   | (40,000       | ) |   | -           |   |   | 70,000      |  
|                                                            | - at $0.80 |  |   | 250,000    |   |   | 250          |   |   | 199,750    |   |   | -             |   |   | -           |   |   | 200,000     |  
|                                                            | - at $1.10 |  |   | 2,230,924  |   |   | 2,231        |   |   | 2,451,785  |   |   | (3,300        | ) |   | -           |   |   | 2,450,716   |  
|Capital stock issued for commission                         |            |  |   | 126,090    |   |   | 126          |   |   | (126       | ) |   | -             |   |   | -           |   |   | -           |  
|Less: commission - cash                                     |            |  |   | -          |   |   | -            |   |   | (64,021    | ) |   | -             |   |   | -           |   |   | (64,021     | )
|Stock as bonus                                              | - at $0.86 |  |   | 750,000    |   |   | 750          |   |   | 644,250    |   |   | -             |   |   | -           |   |   | 645,000     |  
|Stock issued to settle accounts payable                     | - at $1.00 |  |   | 158,000    |   |   | 158          |   |   | 157,842    |   |   | -             |   |   | -           |   |   | 158,000     |  
|Stock-based compensation  Note 8                           |            |  |   | -          |   |   | -            |   |   | 533,252    |   |   | -             |   |   | -           |   |   | 533,252     |  
|Net loss for the year                                       |            |  |   | -          |   |   | -            |   |   | -          |   |   | -             |   |   | (5,056,117  | ) |   | (5,056,117  | )
|Balance, December 31, 2007                                  |            |  |   | 17,866,471 |   | $ | 17,866       |   | $ | 22,348,056 |   | $ | (3,300        | ) | $ | (23,610,817 | ) | $ | (1,248,195  | )

SEE ACCOMPANYING NOTES

---

ACRONGENOMICS,INC.(A Development Stage
  Company) 
  STATEMENT OF CHANGES IN CAPITAL DEFICIT 
  for the period August
  17, 1999 (Date of Inception) to December 31, 2008 
  (Stated in US Dollars)

|                                                                  |            |  |   |            |  |   |              |  |         |            |   |   |               |   |   | Deficit     |   |         |            |  
|----------------------------------------------------------------- | ---------- |  | - | ---------- |  | - | ------------ |  | ------- | ---------- | - | - | ------------- | - | - | ----------- | - | ------- | ---------- | -
|                                                                  |            |  |   |            |  |   | Common Stock |  |         |            |   |   |               |   |   | Accumulated |   |         |            |  
|                                                                  |            |  |   |            |  |   |              |  |         | Additional |   |   | Share         |   |   | During the  |   |         |            |  
|                                                                  |            |  |   |            |  |   |              |  |         | Paid-in    |   |   | Subscriptions |   |   | Development |   |         |            |  
|                                                                  |            |  |   | Shares     |  |   | Par Value    |  |         | Capital    |   |   | (Receivable)  |   |   | Stage       |   |         | Total      |  
|Balance, December 31, 2007                                        |            |  |   | 17,866,471 |  | $ | 17,866       |  | $       | 22,348,056 |   | $ | (3,300        | ) | $ | (23,610,817 | ) | $       | (1,248,195 | )
|Stock Subscriptions                                               |            |  |   | -          |  |   | -            |  |         | -          |   |   | 29,800        |   |   | -           |   |         | 29,800     |  
|Capital stock issued for cash:                                    | - at $0.80 |  |   | 1,250,010  |  |   | 1,250        |  |         | 998,758    |   |   | -             |   |   | -           |   |         | 1,000,008  |  
|                                                                  | - at $1.10 |  |   | 90,000     |  |   | 90           |  |         | 98,910     |   |   | -             |   |   | -           |   |         | 99,000     |  
|                                                                  | - at $0.40 |  |   | 1,450,250  |  |   | 1,450        |  |         | 578,650    |   |   | -             |   |   | -           |   |         | 580,100    |  
|Capital stock issued for consulting and management
      fees     |            |  |   |            |  |   |              |  |         |            |   |   |               |   |   |             |   |         |           
|                                                                  | - at $0.95 |  |   | 150,000    |  |   | 150          |  |         | 142,350    |   |   | -             |   |   | -           |   |         | 142,500    |  
|                                                                  | - at $0.53 |  |   | 150,000    |  |   | 150          |  |         | 79,350     |   |   | -             |   |   | -           |   |         | 79,500     |  
|                                                                  | - at $0.27 |  |   | 1,650,000  |  |   | 1,650        |  |         | 443,850    |   |   | -             |   |   | -           |   |         | 445,500    |  
|Less: commission - cash                                           |            |  |   | -          |  |   | -            |  |         | (169,460   | ) |   | -             |   |   | -           |   |         | (169,460   | )
|Capital stock issued to settle accounts payable:                  | - at $0.95 |  |   | 150,000    |  |   | 150          |  |         | 142,350    |   |   | -             |   |   | -           |   |         | 142,500    |  
|                                                                  | - at $0.79 |  |   | 1,150,000  |  |   | 1,150        |  |         | 907,350    |   |   | -             |   |   | -           |   |         | 908,500    |  
|Beneficial conversion feature on
      convertible notes - Note 4 |            |  | - |            |  | - |              |  | 482,124 |            |   | - |               |   | - |             |   | 482,124 |           
|Stock-based compensation  Note 8                                 |            |  |   | -          |  |   | -            |  |         | 454,919    |   |   | -             |   |   | -           |   |         | 454,919    |  
|Net loss for the year                                             |            |  |   | -          |  |   | -            |  |         | -          |   |   | -             |   |   | (3,022,005  | ) |         | (3,022,005 | )
|                                                                  |            |  |   |            |  |   |              |  |         |            |   |   |               |   |   |             |   |         |            |  
|Balance, December 31, 2008                                        |            |  |   | 23,906,731 |  | $ | 23,906       |  | $       | 26,507,207 |   | $ | 26,500        |   | $ | (26,632,822 | ) | $       | (75,209    | )

SEE ACCOMPANYING NOTES

---

ACRONGENOMICS, INC.(A Development Stage
  Company) 
  NOTES TO THE FINANCIAL STATEMENTS 
  December 31, 2008 and 2007 
  (Stated in US Dollars)

|Note 1 | Nature of Operations and
      Ability to Continue as a Going Concern                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|------ | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|       | The Company was incorporated in the State of Nevada, USA
      on August 17, 1999 as Cellway Ventures Inc. Effective February 25, 2004,
      the Company changed its name to Acrongenomics, Inc.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|       | The Company is in the development stage as defined by
      Statement of Financial Accounting Standard (SFAS) No. 7 Accounting
        and Reporting by Development Stage Enterprises and has not yet
      realized any revenues from its planned operations. The Companys business
      is research and development in the field of life science including BioLED
      technology.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|       | These financial statements have been prepared in
      accordance with generally accepted accounting principles in the United
      States of America on a going concern basis, which assumes that the Company
      will continue to realize its assets and discharge its obligations and
      commitments in the normal course of operations. Realization values may be
      substantially different from carrying values as shown and these financial
      statements do not give effect to adjustments that would be necessary to
      the carrying values and classification of assets and liabilities should
      the Company be unable to continue as a going concern. At December 31,
      2008, the Company had not yet achieved profitable operations, had an
      accumulated deficit of $26,632,822 (2007 - $23,610,817) since its
      inception and incurred a net loss of $3,022,005 (2007 - $ 5,056,117) for
      the year then ended and expects to incur further losses in the development
      of its business, all of which casts substantial doubt about the Companys
      ability to continue as a going concern. The Companys ability to continue
      as a going concern is dependent upon its ability to generate future
      profitable operations and/or to obtain the necessary financing to meet its
      obligations and repay its liabilities arising from normal business
      operations when they come due. Management expects the Companys cash
      requirement over the twelve-month period ended December 31, 2009 to be
      $1,800,000. Management has no formal plan in place to address this concern
      but considers obtaining additional funds by equity financing and/or from
      issuing promissory notes. While the Company is expending its best efforts
      to achieve the above plans, there is no assurance that any such activity
      will generate funds for operations.
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|Note 2 | Summary of Significant Accounting Policies                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|       | The preparation of financial statements in accordance
      with United States generally accepted accounting principles requires
      management to make estimates and assumptions that affect the reported
      amounts of assets and liabilities at the date of the financial statements
      and the reported amounts of revenue and expenses in the reporting period.
      The Company regularly evaluates estimates and assumptions related to
      deferred income tax asset valuations, asset impairment, stock based
      compensation and loss contingencies. The Company bases its estimates and
      assumptions on current facts, historical experience and various other
      factors that it believes to be reasonable under the circumstances, the
      results of which form the basis for making judgments about the carrying
      values of assets and liabilities and the accrual of costs and expenses
      that are not readily apparent from other sources.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              

---

Acrongenomics, Inc. 
  (A Development Stage Company) 
  Notes
  to the Financial Statements 
  December 31, 2008 and 2007 
  (Stated in US
    Dollars)  Page 2

|Note 2 | Summary of Significant
      Accounting Policies  (contd)                                                                                                                                                                                                                
|------ | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|       |                                                                                                                                                                                                                                                                            
|       | The actual results experienced by the Company may differ
      materially and adversely from the Companys estimates. To the extent there
      are material differences between the estimates and the actual results,
      future results of operations will be affected.
|       |                                                                                                                                                                                                                                                                            
|       | The financial statements have, in managements opinion
      been properly prepared within the framework of the significant accounting
      principles summarized below:                                                                                                  

| | a) | Development Stage                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | -- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| |    | The Company is a development stage company as defined in
      Statement of Financial Accounting Standards (SFAS) No. 7 as it is
      devoting substantially all of its efforts to establish a new business and
      planned principal operations have not commenced. All losses accumulated
      since inception have been considered as part of the Companys development
      stage activities.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| | b) | Investment in Molecular Vision Ltd.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| |    | The Company has made an equity investment in Molecular
      Vision Ltd., a privately held company incorporated in Great Britain and
      whose business is complementary to the Companys business. This investment
      is accounted for under the cost method of accounting, as the Company held
      less than 20% of the voting stock outstanding and did not exert
      significant influence over this company. The Company records an impairment
      to its investment when a decline in value in such investments is
      determined to be other-than-temporary.                                                                                                                                                                                                                                                                                                                                                                                                
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| | c) | Impairment of Long-Lived Assets                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| |    | The Company reviews the recoverability of its long-lived
      assets as required by SFAS No. 144, Accounting for the Impairment or
      Disposal of Long-Lived Assets, whenever events or changes in
      circumstances indicate that the carrying amount of such assets may not be
      recoverable. The estimated future cash flows are based upon, among other
      things, assumptions about future operating performance, and may differ
      from actual cash flows. Long-lived assets evaluated for impairment are
      grouped with other assets to the lowest level for which identifiable cash
      flows are largely independent of the cash flows of other groups of assets
      and liabilities. If the sum of the projected undiscounted cash flows
      (excluding interest) is less than the carrying value of the assets, the
      assets will be written down to the estimated fair value in the period in
      which the determination is made.

---

Acrongenomics, Inc. 
  (A Development Stage Company) 
  Notes
  to the Financial Statements 
  December 31, 2008 and 2007 
  (Stated in US
    Dollars)  Page 3

|Note 2 | Summary of Significant
      Accounting Policies (contd)
|------ | ----------------------------------------------------------

| | d) | Financial Instruments                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| | -- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| |    | The carrying value of the Companys financial
      instruments, consisting of cash, accounts payable and accrued liabilities,
      convertible promissory note payable and loans payable approximate their
      fair value due to the short maturity of such instruments. Unless otherwise
      noted, it is managements opinion that the Company is not exposed to
      significant interest or credit risks arising from these financial
      instruments. The Company is subject to foreign exchange price risk as it
      periodically incurs expenses and accrues liabilities denominated in Euros.
      At December 31, 2008, there are accounts payable and accrued liabilities
      totalling $ 3,641 (€ 2,810) denominated in Euros. At December 31, 2007,
      there was accounts payable and accrued liabilities totalling $196,734 (£
      98,500) denominated in British pounds. The Company does not use derivative
      instruments to reduce its exposure to fluctuations in exchange
      rates.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| | e) | Income Taxes                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| |    | The Company follows SFAS No. 109, Accounting for Income
      Taxes which requires the use of the asset and liability method of
      accounting for income taxes. Under the asset and liability method of SFAS
      No. 109, deferred tax assets and liabilities are recognized for future tax
      consequences attributable to temporary differences between the financial
      statements carrying amounts of existing assets and liabilities and loss
      carry forwards and their respective tax bases. Deferred tax assets and
      liabilities are measured using enacted tax rates expected to apply to
      taxable income in the year in which those temporary differences are
      expected to be recovered or settled.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| | f) | Basic and Diluted Loss per Share                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| |    | The Company reports basic loss per share in accordance
      with the SFAS No. 128, Earnings per Share. Basic loss per share is
      computed using the weighted average number of shares outstanding during
      the period. Diluted loss per share is computed similar to basic loss per
      share except that the denominator is increased to include the number of
      additional common shares that would have been outstanding if the dilutive
      potential common shares had been issued. In addition, in computing the
      dilutive effect of convertible securities, the numerator is adjusted to
      add back any convertible preferred dividend and the after-tax amount of
      interest in the period associated with any convertible debt. The numerator
      is also adjusted for any other changes in income or loss that would result
      from the assumed conversion of these potential common shares. Common share
      equivalents represent the dilutive effect of the assumed exercise of the
      outstanding stock options and warrants, using the treasury stock method,
      at either the beginning of the respective period presented or the date of
      issuance, whichever is later, and only if the common stock equivalents are
      considered dilutive based upon the Companys net loss position at the
      calculation date. For the year ended December 31, 2008, loss per share
      excludes 7,328,550 (December 31, 2007  5,048,213) potentially dilutive
      common shares (related to outstanding options, warrants and convertible
      notes) as their effect was anti-dilutive.

---

Acrongenomics, Inc. 
  (A Development Stage Company) 
  Notes
  to the Financial Statements 
  December 31, 2008 and 2007 
  (Stated in US
    Dollars)  Page 4

|Note 2 | Summary of Significant
      Accounting Policies (contd)
|------ | ----------------------------------------------------------

| | f) | Foreign Currency Translation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| |    | The Companys functional currency is the United States
      dollar. The Company uses the United States dollar as its reporting
      currency for consistency with registrants of the Securities and Exchange
      Commission (SEC) and in accordance with the SFAS No. 52. Transactions
      undertaken in currencies other than the functional currency of the entity
      are translated using the exchange rate in effect as of the transaction
      date. Any exchange gains and losses are included in the Statement of
      Operations.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| | g) | Stock-based Compensation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| |    | The Company accounts for all stock-based payments and
      awards under the fair value based method.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| |    | Stock-based payments to non-employees are measured at the
      fair value of the consideration received, or the fair value of the equity
      instruments issued, or liabilities incurred, whichever is more reliably
      measurable. The fair value of stock-based payments to non-employees is
      periodically re-measured until the counterparty performance is complete,
      and any change therein is recognized over the vesting period of the award
      and in the same manner as if the Company had paid cash instead of paying
      with or using equity based instruments on an accelerated basis as required
      by Emerging Issues Task Force (EITF) Issue No. 96-18 Accounting for
      Equity Instruments That Are Issued to Other Than Employees for Acquiring,
      or in Conjunction with Selling, Goods or Services.. The
      cost of the stock-based payments to non-employees that are fully vested
      and non-forfeitable as at the grant date is measured and recognized at
      that date, unless there is a contractual term for services in which case
      such compensation would be amortized over the contractual term.                                                                                                                                                                                                                                                                                              
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| |    | The Company accounts for the granting of share purchase
      options to employees using the fair value method whereby all awards to
      employees will be recorded at fair value on the date of the grant. Share
      based awards granted to employees with a performance condition are
      measured based on the probable outcome of that performance condition
      during the requisite service period. Such an award with a performance
      condition is accrued if it is probable that a performance condition will
      be achieved. Compensation costs for stock-based payments to employees that
      do not include performance conditions are recognized on a straight-line
      basis. The fair value of all share purchase options is expensed over their
      vesting period with a corresponding increase to additional capital
      surplus. Upon exercise of share purchase options, the consideration paid
      by the option holder, together with the amount previously recognized in
      additional capital surplus, is recorded as an increase to share capital
      The Company uses the Black-Scholes option valuation model to calculate the
      fair value of share purchase options at the date of the grant. Option
      pricing models require the input of highly subjective assumptions,
      including the expected price volatility. Changes in these assumptions can
      materially affect the fair value estimate.

---

Acrongenomics, Inc. 
  (A Development Stage Company) 
  Notes
  to the Financial Statements 
  December 31, 2008 and 2007 
  (Stated in US
    Dollars)  Page5

|Note 2 | Summary of Significant
      Accounting Policies (contd)
|------ | ----------------------------------------------------------

| | i) | Research and Development                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| |    | Research and development costs are expensed as incurred.
      These expenses are comprised of the costs of the Companys proprietary
      research and development efforts, including salaries, facilities costs,
      overhead costs and other related expenses as well as costs incurred in
      connection with third-party collaboration efforts. Milestone payments made
      by the Company to third parties are expensed when the specific milestone
      has been achieved. In addition, the Company incurs expenses in respect of
      the acquisition of intellectual property relating to patents. The
      probability of success and length of time to developing commercial
      applications of the technology subject to the acquired patents is
      difficult to determine and numerous risks and uncertainties exist with
      respect to the timely completion of the development projects. There is no
      assurance the acquired patents will ever be successfully commercialized.
      Due to these risks and uncertainties, the Company expenses the acquisition
      of patents.                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| | j) | Comparative Figures                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| |    | Certain of the comparative figures have been reclassified
      to conform with the presentation of the current year.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| |    | During the year ended December 31, 2006, the Company
      cancelled 4,000,000 common shares which had previously been presented on
      the Statement of Stockholders Equity as a charge to additional paid-in
      capital of $7,836,000 and a credit to accumulated deficit in the amount of
      $7,840,000. During the year ended December 31, 2008, the credit to the
      accumulated deficit of $7,840,000 was reclassified to additional paid-in
      capital.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| | k) | New Accounting Standards                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| |    | Recently adopted accounting
      pronouncements                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| |    | On September 15, 2006, FASB issued Statement No. 157,
      Fair Value Measurements (SFAS No. 157). SFAS No. 157 provides guidance
      for using fair value to measure assets and liabilities. SFAS No. 157
      references fair value as the price that would be received to sell an asset
      or paid to transfer a liability in an orderly transaction between market
      participants in the market in which the reporting entity transacts. SFAS
      No. 157 applies whenever other standards require (or permit) assets or
      liabilities to be measured at fair value. SFAS No. 157 does not expand the
      use of fair value in any new circumstances. Originally, SFAS No. 157 was
      effective for financial statements issued for fiscal years beginning after
      November 15, 2007, and interim periods within those fiscal years.
      Accordingly, we adopted SFAS No. 157 in the first quarter of fiscal year
      2008. In February 2008, the FASB issued FASB Staff Position No. 157-2,
      Effective Date of FASB Statement No. 157, which provides a one year
      deferral of the effective date of SFAS No. 157 for non-financial assets
      and non-financial liabilities, except those that are recognized or
      disclosed in the financial statements at fair value at least annually.
      Therefore, the Company has adopted the provisions of SFAS No. 157 with
      respect to its financial assets and liabilities only. See Note 4 Fair
      Value Measurements in the Notes to Financial Statements
      herein.

---

Acrongenomics, Inc. 
  (A Development Stage Company) 
  Notes
  to the Financial Statements 
  December 31, 2008 and 2007 
  (Stated in US
    Dollars)  Pagein US Dollars)  Page 6

|Note 2 | Summary of Significant
      Accounting Policies (contd)
|------ | ----------------------------------------------------------

| | k) | New Accounting Standards  (contd)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| |    | Recently adopted accounting pronouncements 
      (contd)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| |    | Effective January 1, 2008, the Company adopted Statement
      of Financial Accounting Standard (SFAS) No. 159, The Fair Value Option
      for Financial Assets and Financial Liabilities-Including an amendment of
      FASB Statement No. 115. SFAS No. 159 gives the Company the irrevocable
      option to elect fair value for the initial and subsequent measurement for
      certain financial assets and liabilities on a contract-by-contract basis
      with the difference between the carrying value before election of the fair
      value option and the fair value recorded upon election as an adjustment to
      beginning retained earnings. As of December 31, 2008, the Company had not
      elected the fair value option for any eligible financial asset or
      liability.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| |    | In June 2007, the Emerging Issues Task Force (EITF)
      reached a consensus on EITF No. 07-03, Accounting for Non-refundable
      Advance Payments for Goods or Services to Be Used in Future Research and
      Development Activities (EITF 07-03). EITF 07- 03 specifies the timing of
      expense recognition for non-refundable advance payments for goods or
      services that will be used or rendered for research and development
      activities. EITF 07-03 was effective for fiscal years beginning after
      December 15, 2007. The adoption of EITF 07-03 did not have a material
      impact on the Companys financial position and results of
      operations.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| |    | Recent Accounting Pronouncements Not Yet
      Adopted                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| |    | In December 2007, FASB issued Statement No. 141 (Revised
      2007), Business Combinations (SFAS 141(R)) and SFAS No. 160, Accounting
      and Reporting of Non-controlling Interests in Consolidated Financial
      Statements, an amendment of ARB No. 51 (SFAS 160). SFAS 141(R) requires
      companies to: (i) recognize, with certain exceptions, 100% of the fair
      values of assets acquired, liabilities assumed, and non-controlling
      interests in acquisitions of less than a 100% controlling interest when
      the acquisition constitutes a change in control of the acquired entity;
      (ii) measure acquirer shares issued in consideration for a business
      combination at fair value on the acquisition date; (iii) recognize
      contingent consideration arrangements at their acquisition-date fair
      values, with subsequent changes in fair value generally reflected in
      earnings; (iv) with certain exceptions, recognize pre-acquisition loss and
      gain contingencies at their acquisition-date fair values; (v) capitalize
      in-process research and development (IPR&D) assets acquired; (vi)
      expense, as incurred, acquisition- related transaction costs; (vii)
      capitalize acquisition-related restructuring costs only if the criteria in
      SFAS No. 146, Accounting for Costs Associated with Exit or Disposal
      Activities , are met as of the acquisition date; and (viii) recognize
      changes that result from a business combination transaction in an
      acquirers existing income tax valuation allowances and tax uncertainty
      accruals as adjustments to income tax expense.

---

Acrongenomics, Inc. 
  (A Development Stage Company) 
  Notes
  to the Financial Statements 
  December 31, 2008 and 2007 
  (Stated in US
    Dollars)  Page 7

|Note 2 | Summary of Significant
      Accounting Policies (contd)
|------ | ----------------------------------------------------------

| | k) | New Accounting Standards  (contd)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | -- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| |    | Recent Accounting Pronouncements Not Yet Adopted 
      (contd)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| |    | SFAS 141(R) is required to be adopted concurrently with
      SFAS 160 and is effective for business combination transactions for which
      the acquisition date is on or after the beginning of the first annual
      reporting period beginning on or after December 15, 2008. Early adoption
      of these statements is prohibited. The Company does not believe the
      adoption of these statements will have a material impact on significant
      acquisitions completed after January 1, 2009.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| |    | In December 2007, the Emerging Issues Task Force (EITF)
      reached a consensus on EITF No. 07-01, Accounting for Collaborative
      Arrangements Related to the Development and Commercialization of
      Intellectual Property (EITF 07-01). EITF 07-01 discusses the appropriate
      income statement presentation and classification for the activities and
      payments between the participants in arrangements related to the
      development and commercialization of intellectual property. The
      sufficiency of disclosure related to these arrangements is also specified.
      EITF 07-01 is effective for fiscal years beginning after December 15,
      2008. As a result, EITF 07-01 was effective for the Company as of January
      1, 2009. The Company expects that the adoption of EITF 07-01 will have
      minimal, if any, impact on its financial position and results of
      operations. However, based upon the nature of the Companys business, EITF
      07-01 could have a material impact on its financial position and results
      of operations in future years.
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| |    | In April 2008, the FASB issued FSP 142-3, Determination
      of the Useful Life of Intangible Assets. This FSP amends the factors that
      should be considered in developing renewal or extension assumptions used
      to determine the useful life of a recognized intangible asset under FASB
      Statement No. 142, Goodwill and Other Intangible Assets. The intent of
      this FSP is to improve the consistency between the useful life of a
      recognized intangible asset under Statement 142 and the period of expected
      cash flows used to measure the fair value of the asset under FASB
      Statement No. 141 (Revised 2007), Business Combinations, and other U.S.
      generally accepted accounting principles (GAAP). This FSP is effective for
      financial statements issued for fiscal years beginning after December 15,
      2008, and interim periods within those fiscal years. Early adoption is
      prohibited. The Company does not expect the adoption of FAS 142-3 to have
      a material effect on its results of operations and financial
      condition. 

---

Acrongenomics, Inc. 
  (A Development Stage Company) 
  Notes
  to the Financial Statements 
  December 31, 2008 and 2007 
  (Stated in US
    Dollars)  Page8

|Note 2 | Significant Accounting
      Policies (contd)
|------ | -----------------------------------------------

| | k) | New Accounting Standards (contd)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| |    | Recent Accounting Pronouncements Not Yet Adopted 
      (contd)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| |    | .In May 2008, FASB issued SFAS No. 162, The Hierarchy of
      Generally Accepted Accounting Principles (SFAS 162). This standard is
      intended to improve financial reporting by identifying a consistent
      framework, or hierarchy, for selecting accounting principles to be used in
      preparing financial statements that are presented in conformity with U.S.
      GAAP for non-governmental entities. SFAS No. 162 is effective 60 days
      following the U.S. Securities and Exchange Commissions approval of the
      Public Company Accounting Oversight Board amendments to AU Section 411,
      the meaning of Present Fairly in Conformity with GAAP. The Company is in
      the process of evaluating the impact, if any, of SFAS 162 on its financial
      statements.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| |    | In May 2008, the FASB issued FSP No. APB 14-1,
      Accounting for Convertible Debt Instruments That May Be Settled in Cash
      upon Conversion (Including Partial Cash Settlement) (FSP APB 14-1). FSP
      APB 14-1 applies to convertible debt instruments that, by their stated
      terms, may be settled in cash (or other assets) upon conversion, including
      partial cash settlement, unless the embedded conversion option is required
      to be separately accounted for as a derivative under SFAS 133. Convertible
      debt instruments within the scope of FSP APB 14-1 are not addressed by the
      existing APB 14. FSP APB 14-1 requires that the liability and equity
      components of convertible debt instruments within the scope of FSP APB
      14-1 be separately accounted for in a manner that reflects the entitys
      nonconvertible debt borrowing rate. This requires an allocation of the
      convertible debt proceeds between the liability component and the embedded
      conversion option (i.e., the equity component). The difference between the
      principal amount of the debt and the amount of the proceeds allocated to
      the liability component will be reported as a debt discount and
      subsequently amortized to earnings over the instruments expected life
      using the effective interest method. FSP APB 14-1 is effective for the
      Companys fiscal year beginning January 1, 2009 and will be applied
      retrospectively to all periods presented. The Company is currently
      evaluating the effects of adopting FSP APB 14-1.
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| |    | In June 2008, the FASB reached consensus on EITF Issue
      No. 07-05 (EITF 07-05), Determining Whether an Instrument (or embedded
      feature) Is Indexed to an Entitys Own Stock.. EITF 07-05 clarifies the
      determination of whether an instrument (or an embedded feature) is indexed
      to an entitys own stock, which would qualify as a scope exception under
      SFAS 133. EITF 07-05 is effective for financial statements issued for
      fiscal years beginning after December 15, 2008. Early adoption of EITF
      07-05 is not permitted. The Company does not believe the adoption of EITF
      07-05 will have a material impact on the Companys financial position,
      results of operations or cash flows.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       

---

Acrongenomics, Inc. 
  (A Development Stage Company) 
  Notes
  to the Financial Statements 
  December 31, 2008 and 2007 
  (Stated in US
    Dollars)  Page 9

|Note 3 | Investment in Molecular Vision
      Ltd.                                                      
|------ | -----------------------------------------------------------------------------------------------
|       |                                                                                                
|       | The Companys investment in Molecular Vision Ltd.
      (Molecular) is summarized as follows:

| |                                                        |  | Number of    |  |   |           |  
| | ------------------------------------------------------ |  | ------------ |  | - | --------- | -
| |                                                        |  | Molecular    |  |   |           |  
| |                                                        |  | shares owned |  |   | Amount    |  
| |                                                        |  |              |  |   |           |  
| | Balance, December 31, 2007                             |  | -            |  | $ | -         |  
| |                                                        |  |              |  |   |           |  
| | Acquisition of Molecular shares for GBP
      £550,000 |  | 16,566       |  |   | 1,097,639 |  
| | Refund of amounts previously advanced on               |  |              |  |   |           |  
| | termination of development
      agreement:            |  |              |  |   |           |  
| | Credit applied to amounts owed Molecular               |  | -            |  |   | (156,615  | )
| | Cash refunded                                          |  | -            |  |   | (149,794  | )
| | Molecular shares received as consideration             |  |              |  |   |           |  
| | for termination of development
      agreement         |  | 17,168       |  |   | -         |  
| |                                                        |  |              |  |   |           |  
| | Balance, December 31, 2008                             |  | 33,734       |  | $ | 791,230   |  

The 33,734 shares owned in Molecular
  above represent 17.2% of the total issued shares of Molecular as at December 31,
  2008.

By a development agreement dated
  February 13, 2007 and amended May 23, 2007, the Company agreed to collaborate
  with Molecular to acquire the exclusive rights to commercialize certain
  technology relating to the analysis/diagnostic fields (BioLED Technology), to
  contract Molecular to complete the research and development necessary to achieve
  manufacturable prototypes and have first right of refusal to fund the
  development of additional applications of the technology by agreeing to pay
  $4,225,700 (GBP£2,325,000) (this sum is in addition to the GBP£575,000
  previously paid under the February 13, 2007 agreement) over 3 years and grant
  2,000,000 share purchase options entitling the holders thereof the right to
  purchase one common share of the Company at $0.50 per share. The options were to
  vest at 50% per milestone and be exercisable within a period of 5 years from the
  date of vesting. As the vesting of the share purchase options granted were
  contingent upon the performance milestones, no value was ascribed to them as it
  was unlikely that they would be vested. These options did not vest and were
  cancelled pursuant to the termination of the development agreement as noted
  below.

Molecular also granted to the Company
  an exclusive, worldwide, perpetual license to the intellectual property to
  develop and commercialize it, subject to the payment to the vendor of a royalty
  of 30% of gross receipts.

On January 31, 2008, by a Heads of
  Terms agreement dated in November 2007 and amended February 1, 2008, the Company
  acquired 16,566 common shares amounting to 13.97 % of the share capital of
  Molecular at that date for $1,097,639 (GBP£550,000).

---

Acrongenomics, Inc. 
  (A Development Stage Company) 
  Notes
  to the Financial Statements 
  December 31, 2008 and 2007 
  (Stated in US
    Dollars)  Page 10

|Note 3 | Investment in Molecular Vision
      Ltd (contd)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|------ | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|       | By a letter agreement dated August 19, 2008 and
      formalized November 12, 2008, the development agreement was terminated. As
      consideration for the Companys contributions made under the development
      agreement and in lieu of certain rights granted under the development
      agreement, Molecular will pay to the Company royalties of 0.3-0.5% on net
      product sales and 3% to 5% of licensing fees received by Molecular until
      patents owned by Molecular expire and issued to the Company 17,168 common
      shares of Molecular for which no value has been recorded. In addition, the
      Company received a refund of $306,409 (GBP£200,000) for amounts previously
      advanced during the year ended December 31, 2008 to Molecular for research
      and development costs but which had not been utilized. The amount was
      refunded as follows: $156,615 (GBP£98,500) applied to amounts owing to
      Molecular and the remaining $149,794 (GBP£101,500) was refunded in cash.
      The Company was also granted the option to purchase 4,518 shares of
      Molecular at £33.20 ($60.34) per share from three founders of Molecular on
      or before December 31, 2008. On December 31, 2008, this option expired
      unexercised.
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|Note 4 | Fair Value Measurements                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|       | SFAS No. 157 defines fair value, establishes a framework
      for measuring fair value under generally accepted accounting principles
      and enhances disclosures about fair value measurements. Fair value is
      defined under SFAS No. 157 as the exchange price that would be received
      for an asset or paid to transfer a liability (an exit price) in the
      principal or most advantageous market for the asset or liability in an
      orderly transaction between market participants on the measurement date.
      Valuation techniques used to measure fair value under SFAS No. 157 must
      maximize the use of observable inputs and minimize the use of unobservable
      inputs. The standard describes a fair value hierarchy based on three
      levels of inputs, of which the first two are considered observable and the
      last unobservable, that may be used to measure fair value which are the
      following:                                                                                                                                                                                                                                                                                                                                

| | Level 1 - | quoted prices (unadjusted) in active markets for
      identical assets or liabilities;                                                                                                                                                                                                                                                   
| | --------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |           |                                                                                                                                                                                                                                                                                                                                           
| | Level 2 - | observable inputs other than Level I, quoted prices for
      similar assets or liabilities in active markets, quoted prices for
      identical or similar assets and liabilities in markets that are not
      active, and model-derived prices whose inputs are observable or whose
      significant value drivers are observable; and
| |           |                                                                                                                                                                                                                                                                                                                                           
| | Level 3 - | assets and liabilities whose significant value drivers
      are unobservable by little or no market activity and that are significant
      to the fair value of the assets or liabilities.                                                                                                                                              

---

Acrongenomics, Inc. 
  (A Development Stage Company) 
  Notes
  to the Financial Statements 
  December 31, 2008 and 2007 
  (Stated in US
    Dollars)  Page 11

|Note 4 | Fair Value Measurements
      (contd)                                                                                                                                                                                                 
|------ | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|       |                                                                                                                                                                                                                                         
|       | In accordance with SFAS 157, the following table
      represents the fair value hierarchy for our financial assets and
      liabilities held by the Company measured at fair value on a recurring
      basis as of December 31, 2008:

| |                                     |   | Level 1 |  |   | Level 2 |  |   | Level 3 |  |   | Total   | 
| | ----------------------------------- | - | ------- |  | - | ------- |  | - | ------- |  | - | ------- | 
| | Assets                              |   |         |  |   |         |  |   |         |  |   |         | 
| | Investment in Molecular Vision Ltd. | $ | -       |  | $ | -       |  | $ | 791,230 |  | $ | 791,230 | 
| |                                     | $ | -       |  | $ | -       |  | $ | 791,230 |  | $ | 791,230 | 
| |                                     |   |         |  |   |         |  |   |         |  |   |         | 
| | Liabilities                         |   |         |  |   |         |  |   |         |  |   |         | 
| | Convertible promissory note payable | $ | -       |  | $ | -       |  | $ | 394,136 |  | $ | 394,136 | 
| |                                     | $ | -       |  | $ | -       |  | $ | 394,136 |  | $ | 394,136 | 

|Note 5 | Convertible Promissory Notes
      Payable                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|------ | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|       | On June 12, 2008, the Company was loaned $394,136 by a
      director of the Company by the issuance of a convertible promissory note,
      payable on demand, with interest accruing on the balance of principal
      outstanding at 8% per annum, compounded monthly and payable monthly. The
      note may be converted into units of the Company at any time and at the
      option of the lender at the rate of $0.40 per unit. Each unit will consist
      of one common share and one share purchase warrant exercisable at $0.75
      per share for a period of two years from the date of issuance. The note is
      secured by an interest in all property of the Company.                                                                                                                         
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|       | On June 17, 2008 the Company was loaned $300,000 by the
      issuance of a convertible promissory note, maturing on September 30, 2008,
      with interest accruing on the balance of principal outstanding at 8% per
      annum, compounded monthly and payable monthly. The promissory note was
      convertible into units of the Company at any time and at the option of the
      lender at the rate of $0.40 per unit. Each unit consisted of one common
      share and one share purchase warrant exercisable at $0.75 for a period of
      two years from the date of issuance. The note was secured by an interest
      in all property of the Company and a further guarantee by a third party.
      During the year-ended December 31, 2008, Company repaid the amount owing
      on this note.
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|       | The Company recorded a beneficial conversion feature
      totaling $482,124 based on the comparison of the proceeds of these two
      notes allocated to the common stock portion of the conversion feature and
      the fair value of the common stock at the commitment date of the note in
      accordance with EITF 00-27 Application of Issue 98-5 to Certain
      Convertible Instruments. This amount was accreted in income in its
      entirety and included in interest on notes payable in the financial
      statements for the year ended December 31, 2008 due to the promissory note
      issued on June 12, 2008 not having a stated maturity date and the
      promissory note issued on June 17, 2008 having matured and paid out on
      September 30, 2008.                         

---

Acrongenomics, Inc. 
  (A Development Stage Company) 
  Notes
  to the Financial Statements 
  December 31, 2008 and 2007 
  (Stated in US
    Dollars)  Page 12

|Note 6 | Loans Payable                                                                                                                                                                                                                                                                                                                                                                                                                                            
|------ | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|       | Loans payable are unsecured, non-interest bearing and
      have no specific terms for repayment.                                                                                                                                                                                                                                                                                                                                                        
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|Note 7 | Related Party Transactions                                                                                                                                                                                                                                                                                                                                                                                                                               
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|       | The Company incurred the following charges with directors
      and officers, companies with a common director and former director, an
      officer and director of a company of which a former officer and director
      is the spouse of the Companys president; the research and development
      expenditures were paid to a company in which a former officer and director
      of the Company is the spouse of the Companys former president:

| |                                       |   |                     |  |   |               |  |   | August 17,    | 
| | ------------------------------------- | - | ------------------- |  | - | ------------- |  | - | ------------- | 
| |                                       |   |                     |  |   |               |  |   | 1999 (Date of | 
| |                                       |   | For the Years Ended |  |   | Inception) to | 
| |                                       |   | December 31,        |  |   | December 31,  | 
| |                                       |   | 2008                |  |   | 2007          |  |   | 2008          | 
| |                                       |   |                     |  |   |               |  |   |               | 
| | Accounting fees                       | $ | 85,244              |  | $ | 48,317        |  | $ | 275,143       | 
| | Consulting fees                       |   | 169,600             |  |   | 332,400       |  |   | 566,901       | 
| | Legal fees                            |   | -                   |  |   | -             |  |   | 60,656        | 
| | Management fees                       |   | 192,750             |  |   | 1,999,505     |  |   | 2,747,128     | 
| | Rent                                  |   | -                   |  |   | -             |  |   | 36,000        | 
| | Research and development              |   | -                   |  |   | -             |  |   | 5,604,189     | 
| | Interest and accretion on convertible |   |                     |  |   |               |  |   |               | 
| | promissory note - Note 5              |   | 309,487             |  |   | -             |  |   | 309,487       | 
| |                                       | $ | 757,081             |  | $ | 2,380,222     |  | $ | 9,599,504     | 

|       | Research and development expenditures charged by a
      related company were comprised of testing costs of the molecular
      diagnostic test products.                                                                                                                                                                                                
|------ | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|       |                                                                                                                                                                                                                                                                                                                                                          
|       | Accounts payable and accrued liabilities at December 31,
      2008 includes $149,062 (2007: $1,166,568) owing to companies with a common
      director, a former director and a company of which a former officer and
      director is the spouse of the Companys former president for accounting,
      management and consulting services received.
|       |                                                                                                                                                                                                                                                                                                                                                          
|Note 8 | Capital Stock                                                                                                                                                                                                                                                                                                                                            
|       |                                                                                                                                                                                                                                                                                                                                                          
|       | All common share issuances of the Company for non-cash
      consideration since the date of inception have been valued at the quoted
      market price of the Company stock at the time they are issued.                                                                                                                                               
|       |                                                                                                                                                                                                                                                                                                                                                          
|       | In February 2007, the Company issued 220,000 common
      shares pursuant to a private placement at $0.50 per share for total
      proceeds of $110,000. The Company issued 20,000 common shares as a
      commission on this placement.                                                                                                               

---

Acrongenomics, Inc. 
  (A Development Stage Company) 
  Notes
  to the Financial Statements 
  December 31, 2008 and 2007 
  (Stated in US
    Dollars)  Page 13

|Note 8 | Capital Stock (contd)                                                                                                                                                                                                                                                                                                                                                 
|------ | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|       |                                                                                                                                                                                                                                                                                                                                                                         
|       | In April, 2007, the Company issued 2,230,924 common
      shares pursuant to a private placement at $1.10 per share for total
      proceeds of $2,454,016 (of which $3,300 was unpaid as of the issuance date
      and December 31, 2007. Such was received in 2008.) The Company issued
      84,090 common shares and paid $64,021 as a commission on this placement
|       |                                                                                                                                                                                                                                                                                                                                                                         
|       | On July 31, 2007, the Company issued 250,000 common
      shares pursuant to a private placement at $0.80 per share for total
      proceeds of $200,000. The Company issued 22,000 common shares as a
      commission for these placements.                                                                                                                           
|       |                                                                                                                                                                                                                                                                                                                                                                         
|       | On September 3, 2007, the Company issued 750,000 common
      shares at a quoted market price of $0.86 per share for a total of $645,000
      pursuant to an agreement to issue common shares to the former CEO of the
      Company as a signing bonus.                                                                                                               
|       |                                                                                                                                                                                                                                                                                                                                                                         
|       | On December 12, 2007, the Company issued 158,000 common
      shares at a quoted market price of $1.00 per share for a total of $158,000
      pursuant to an agreement to settle an account payable.                                                                                                                                                                   
|       |                                                                                                                                                                                                                                                                                                                                                                         
|       | On February 1, 2008, the Company issued 90,000 units at
      $1.10 per unit for total proceeds of $99,000. Each unit consisted of one
      share and one half common share purchase warrant exercisable for 18 months
      at a price of $1.50 per warrant.                                                                                                          
|       |                                                                                                                                                                                                                                                                                                                                                                         
|       | On February 1, 2008, the Company issued a total of
      300,000 common shares to two consultants at a quoted market price of $0.95
      per share for a total of $285,000 for their consulting services performed
      for the Company, of which 150,000 common shares were issued in respect of
      amounts previously accrued in accounts payable.               
|       |                                                                                                                                                                                                                                                                                                                                                                         
|       | On February 14, 2008, the Company issued 1,150,000 common
      shares to two consultants at a quoted market price of $0.79 per share for
      a total of $908,500 to settle accounts payable for past consulting
      services performed for the Company.                                                                                                            
|       |                                                                                                                                                                                                                                                                                                                                                                         
|       | On February 15, 2008, the Company issued 1,250,010 units
      at $0.80 per unit for total proceeds of $1,000,008. Each unit consisted of
      one share and one common share purchase warrant exercisable for 18 months
      at a price of $1.60 per warrant.                                                                                                        
|       |                                                                                                                                                                                                                                                                                                                                                                         
|       | Between July 2, 2008 and December 3, 2008, the Company
      issued 1,450,250 units at $0.40 per unit for total proceeds of $580,100.
      Each unit consisted of one common share and one share purchase warrant
      exercisable at $0.75 until April 20, 2009.                                                                                                     
|       |                                                                                                                                                                                                                                                                                                                                                                         
|       | On June 12, 2008, the Company issued 150,000 common
      shares to two consultants at a quoted market price of $0.53 per share for
      a total of $79,500 for their consulting services performed for the
      Company.                                                                                                                                             
|       |                                                                                                                                                                                                                                                                                                                                                                         
|       | On November 14, 2008, the Company issued 200,000 common
      shares to one consultant at a quoted market price of $0.27 per share for a
      total of $54,000 for consulting services rendered to the Company.                                                                                                                                                        

---

Acrongenomics, Inc. 
  (A Development Stage Company) 
  Notes
  to the Financial Statements 
  December 31, 2008 and 2007 
  (Stated in US
    Dollars)  Page 14

|Note 8 | Capital Stock (contd)                                                                                                                                                                                                           
|------ | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|       |                                                                                                                                                                                                                                   
|       | On December 12, 2008, the Company issued 1,450,000 common
      shares to three consultants at a quoted market price of $0.27 per share
      for a total of $391,500 for their consulting services rendered to the
      Company.
|       |                                                                                                                                                                                                                                   
|       | Commitments                                                                                                                                                                                                                       

| | a) | Share Purchase Warrants                                                                 
| | -- | ----------------------------------------------------------------------------------------
| |    |                                                                                         
| |    | A summary of the Companys share purchase
      warrants outstanding is presented below:

| |                                |  | 2008       |   |  | 2007     | 
| | ------------------------------ |  | ---------- | - |  | -------- | 
| |                                |  |            |   |  | Weighted | 
| |                                |  |            |   |  | Average  | 
| |                                |  | Number of  |   |  | Exercise | 
| |                                |  | Warrants   |   |  | Price    | 
| |                                |  |            |   |  |          | 
| | Outstanding, beginning of year |  | 1,548,213  |   |  | $1.42    | 
| | Issued                         |  | 2,745,260  |   |  | $1.15    | 
| | Expired                        |  | (1,035,603 | ) |  | $1.37    | 
| |                                |  |            |   |  |          | 
| | Outstanding, end of year       |  | 3,257,870  |   |  | $1.20    | 

The following table summarizes the
  warrants outstanding as at December 31, 2008:

Number Outstanding
      
      
      Exerciseand Exercisable
      
      
      Price
      Expiry Date165,000
      
      
      $1.50
      February 28, 2009347,610
      
      
      $1.50
      April 20, 20091,450,250
      
      
      $0.75
      April 20, 200945,000
      
      
      $1.50
      August 1, 20091,250,010
      
      
      $1.60
      August 15, 20093,257,870


Subsequent to December 31, 2008, the
  165,000 share purchase warrants exercisable at $1.50 until February 28, 2009
  expired unexercised.

---

Acrongenomics, Inc. 
  (A Development Stage Company) 
  Notes
  to the Financial Statements 
  December 31, 2008 and 2007 
  (Stated in US
    Dollars)  Page 15

|Note 8 | Capital Stock  (contd)
|------ | ------------------------
|       |                         
|       | Commitments  (contd)  

| | a) | Stock Based Compensation Plan                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| |    | In May, 2005, the Company adopted a stock option plan
      which provides for the granting of stock options to selected directors,
      officers, employees or consultants in an aggregate amount of up to
      2,600,000 common shares of the Company and, in any case, the number of
      shares to be issued to any one individual pursuant to the exercise of
      options shall not exceed 10% of the issued and outstanding share capital.
      The grant of stock options, exercise prices and terms are determined by
      the Company's Board of Directors.
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| |    | A summary of changes in the Companys stock options for
      the years ended December 31, 2008 and 2007 is presented
      below:                                                                                                                                                                                                                                                                                                                                                                                                                                         

| |                                |  | 2008       |      |  | 2007     | 
| | ------------------------------ |  | ---------- | ---- |  | -------- | 
| |                                |  |            |      |  | Weighted | 
| |                                |  |            |      |  | Average  | 
| |                                |  | Number of  |      |  | Exercise | 
| |                                |  | Options    |      |  | Price    | 
| |                                |  |            |      |  |          | 
| | Outstanding, beginning of year |  | 3,500,000  |      |  | $0.70    | 
| | Granted                        |  | 700,000    |      |  | $0.57    | 
| | Expired                        |  | -          |      |  | -        | 
| | Cancelled                      |  | (2,100,000 | )(7) |  | $0.50    | 
| |                                |  |            |      |  |          | 
| | Outstanding, end of year       |  | 2,100,000  |      |  | $0.86    | 
| | Exercisable, end of year       |  | 1,800,000  |      |  | $0.92    | 

At December 31, 2008, the following
  stock options were outstanding:

AggregateNumber of shares
      
      
      
      
      
      
      
      
      
      
      Aggregate
      
      
      IntrinsicTotal
      
      Number
      
      
      Exercise
      
      
      Expiry
      
      
      Intrinsic
      
      
      ValueNumber
      
      Vested
      
      
      Price
      
      
      Date
      
      
      Value
      
      
      of Vested options600,000 (1)
      
      600,000
      
      
      1.00
      
      
      March 22, 2012
      
      $
      -
      
      $
      -100,000 (2)
      
      100,000
      
      
      2.50
      
      
      May 3, 2016
      
      $
      -
      
      $
      -600,000 (3)
      
      450,000
      
      
      0.50
      
      
      February 12, 2017
      
      $
      -
      
      $
      -500,000 (4)
      
      500,000
      
      
      0.60
      
      
      March 31, 2018
      
      $
      -
      
      $
      -100,000 (5)
      
      100,000
      
      
      0.50
      
      
      April 1, 2018
      
      $
      -
      
      $
      -200,000 (6)
      
      50,000
      
      
      0.50
      
      
      April 1, 2018
      
      $
      -
      
      $
      -2,100,000
      
      1,800,000


---

Acrongenomics, Inc. 
  (A Development Stage Company) 
  Notes
  to the Financial Statements 
  December 31, 2008 and 2007 
  (Stated in US
    Dollars)  Page 16

|Note 8 | Capital Stock  (contd)
|------ | ------------------------
|       |                         
|       | Commitments  (contd)  

| | b) | Stock-Based Compensation Plan 
      (contd)
| | -- | ----------------------------------------------

| | (1) | As at December 31, 2008, these options were fully vested.
      The fair value of these options on the grant date was calculated to be
      $480,000 of which $373,479 was recognized as stock-based compensation in
      the year ended December 31, 2007. The remaining amount of $106,521 has
      been recognized as stock-based compensation in 2008 and included in
      management fees in the financial statements for the year ended December
      31, 2008.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | (2) | These options had fully vested at December 31, 2007. As
      such, there was no stock-based compensation expense recognized in 2008 on
      these outstanding options. During the year ended December 31, 2008, the
      Company amended the terms of 100,000 of these options by reducing the
      exercise price to $0.50 and extending the expiry date to April 1, 2018. As
      a result, an incremental fair value of $53,410 was calculated on the
      amended terms and included in management fees for the year ended December
      31, 2008. See Note (5)below.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | (3) | As at December 31, 2008, 450,000 of these options had
      vested. The remaining 150,000 of these options vested on February 12,
      2009. The fair value of these options on their grant date was calculated
      to be $198,000 which is being amortized on a straight-line basis over the
      vesting term. The Company recognized $99,000 (2007: $87,218) included with
      management fees in the financial statements for the year ended December
      31, 2008.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | (4) | As at December 31, 2008, these options were fully vested.
      The fair value of these options was calculated to be $159,563 which amount
      has been recognized as stock-based compensation and included with
      consulting fees in the financial statements for the year ended December
      31, 2008                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | (5) | As at December 31, 2008, these options were fully vested.
      These options were originally included with the grant of 200,000 options
      having an exercise price of $2.50 expiring on May 3, 2016. (2)During the year ended December 31, 2008, 100,000 these options were
      amended to reduce the exercise price to $0.50 and extend the expiry date
      to April 1, 2018. As a result, an incremental fair value of $53,410 was
      calculated on the amended terms and included in management fees for the
      year ended December 31, 2008. See Note (2)above.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | (6) | As at December 31, 2008, 50,000 of these options were
      fully vested. The remaining 150,000 options vest as follows: 50,000 on
      April 1, 2009, 50,000 on October 1, 2009 and 50,000 on April 1, 2010. The
      fair value of these options on the grant date was calculated to be
      $106,000 for which the Company recognized $ 16,030 included with
      consulting fees for the year ended December 31, 2008. The remaining
      150,000 unvested options were re-measured as at December 31, 2008 with
      their fair value calculated to be $ 37,650 for which the Company
      recognized $20,395 included with consulting fees in the financial
      statements for the year ended December 31, 2008. These option were
      re-measured at December 31, 2008 in accordance with the provisions of EITF
      96-18 Accounting for Equity Instruments That are Issued to Other Than
      Employees for Acquiring, or in conjunction with Selling, Goods or
      Services using the Black  Scholes model with the following assumptions:
      Volatility - 123.9%, Risk free interest rate  2.75%, Expected life  9.3
      years and Dividend yield  0.00%
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | (7) | During the year ended December 31, 2008, included the
      options that were cancelled was an amount of 100,000 options that had been
      granted in the year ended December 31, 2007 which had a grant date fair
      value of $480,000, Of this amount, the Company recognized stock based
      compensation in the amount of $72,555 included in consulting fees in the
      financial statements for the year ended December 31, 2007. The remainder
      of the stock based compensation associated with this grant of options was
      not recognized by the Company.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            

---

Acrongenomics, Inc. 
  (A Development Stage Company) 
  Notes
  to the Financial Statements 
  December 31, 2008 and 2007 
  (Stated in US
    Dollars)  Page 17

|Note 8 | Capital Stock  (contd)
|------ | ------------------------
|       |                         
|       | Commitments  (contd)  

| | b) | Stock-Based Compensation Plan
       (contd)                                                                                                                                                                                
| | -- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                               
| |    | The fair value of stock options granted has been
      determined using the Black-Scholes option pricing model using the
      following weighted average assumptions applied to stock options granted
      during the years:

| |                         | 2008             | 2007         
| | ----------------------- | ---------------- | -------------
| |                         |                  |              
| | Expected dividend yield | 0.0%             | 0.0%         
| | Expected volatility     | 82.53% - 123.92% | 83.0% - 90.8%
| | Risk-free Interest Rate | 3.57% - 4.8%     | 4.04%  4.81%
| | Term in years           | 10               | 5.0  10.0   
| | Fair value              | $0.33 - $0.64    | $0.33 - $1.01

The volatility was determined based on
  an index of volatility from comparable companies. The expected term of the
  options granted to employees is derived from the simplified method as prescribed
  by SEC Staff Accounting Bulletin (SAB) No. 110 given that the Company has no
  historical experience with the exercise of options for which to base an estimate
  of the expected term of options granted. The Company anticipates it will
  discontinue the use of the simplified method of SAB 110 once sufficient
  historical option exercise behaviour becomes apparent. The expected term of
  options granted to non-employees was determined to be the option term.

A summary of changes in the Companys
  unvested stock options for the years ended December 31, 2008 and 2007 is
  presented below:

| |                                |  | 2008       |   |  | 2007             | 
| | ------------------------------ |  | ---------- | - |  | ---------------- | 
| |                                |  |            |   |  | Weighted         | 
| |                                |  |            |   |  | Average          | 
| |                                |  | Number of  |   |  | Grant Date       | 
| |                                |  | Options    |   |  | Fair
      Value | 
| |                                |  |            |   |  |                  | 
| | Outstanding, beginning of year |  | 2,825,000  |   |  | $0.40            | 
| | Granted                        |  | 700,000    |   |  | $0.53            | 
| | Cancelled                      |  | (2,050,000 | ) |  | $0.35            | 
| | Vested                         |  | (1,175,000 | ) |  | $0.56            | 
| |                                |  |            |   |  |                  | 
| | Outstanding, end of year       |  | 300,000    |   |  | $0.43            | 

---

Acrongenomics, Inc. 
  (A Development Stage Company) 
  Notes
  to the Financial Statements 
  December 31, 2008 and 2007 
  (Stated in US
    Dollars)  Page 18

|Note 8 | Capital Stock  (contd)
|------ | ------------------------
|       |                         
|       | Commitments  (contd)  

| | b) | Stock-Based Compensation Plan  (contd)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |    | As at December 31, 2008, there was a total of $29,037 of
      unrecognized compensation cost associated with unvested share-based
      compensation awards that will become vested in the year ended December 31,
      2009 and thus, this unrecognized compensation cost is expected to be
      recognized during the year ended December 31, 2009. Stock-based
      compensation amounts, including those relating to shares issued for non-
      cash consideration during the year (Note 10), are classified in the
      Companys Statement of Operations as follows:

| |                 |   | 2008    |  |   | 2007      | 
| | --------------- | - | ------- |  | - | --------- | 
| | Consulting      | $ | 238,239 |  | $ | 72,555    | 
| | Management fees |   | 392,431 |  |   | 1,105,697 | 
| |                 | $ | 630,670 |  | $ | 1,178,252 | 

| | c) | Shares Subscribed                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| |    | At December 31, 2008, the Company had received $26,500
      pursuant to subscription agreements in respect of 66,250 units at $0.40
      per unit. Each unit consists of one common share and one common share
      purchase warrant entitling the holder to purchase an additional share of
      the Company at a price of $0.75 per share for a period of 2 years from the
      date of issuance. Subsequent to December 31, 2008, the Company issued
      these units.

|Note 9 | Income Taxes                                                                                                                                          
|------ | ------------------------------------------------------------------------------------------------------------------------------------------------------
|       |                                                                                                                                                       
|       | The tax effects of the temporary differences that give
      rise to the Company's estimated deferred tax assets and liabilities are as
      follows:

| |                                   |   | 2008       |   |   | 2007       |  
| | --------------------------------- | - | ---------- | - | - | ---------- | -
| | Deferred tax assets               |   |            |   |   |            |  
| | Net operating losses carryforward | $ | 5,160,000  |   | $ | 4,555,000  |  
| | Accruals                          |   | 104,000    |   |   | -          |  
| | Less: valuation allowance         |   | (5,264,000 | ) |   | (4,555,000 | )
| | Deferred tax assets               | $ | -          |   | $ | -          |  

---

Acrongenomics, Inc. 
  (A Development Stage Company) 
  Notes
  to the Financial Statements 
  December 31, 2008 and 2007 
  (Stated in US
    Dollars)  Page 19

|Note 9 | Income Taxes  (contd)                                                                                                                     
|------ | --------------------------------------------------------------------------------------------------------------------------------------------
|       |                                                                                                                                             
|       | The Company's income tax expense for the years ended
      December 31, 2008 and 2007 differed from the United States statutory
      rates:

| |                                          |   | 2008       |   |   | 2007       |  
| | ---------------------------------------- | - | ---------- | - | - | ---------- | -
| | Effective tax rate                       |   | 34%        |   |   | 34%        |  
| | Income tax benefit at statutory rate     | $ | (1,027,000 | ) | $ | (1,719,000 | )
| | Increase in income taxes resulting from: |   |            |   |   |            |  
| | Stock-based compensation                 |   | 155,000    |   |   | 181,000    |  
| | Debt accretion                           |   | 163,000    |   |   | -          |  
| | Change in valuation allowance            |   | 709,000    |   |   | 1,538,000  |  
| | Income tax expense                       | $ | -          |   | $ | -          |  

At December 31, 2008, the Company has
  incurred accumulated net operating losses in the United States of America
  totalling approximately $15,177,000 which are available to reduce taxable income
  in future taxation years.

These losses expire as follows:

| | Year of Expiry |   | Amount     | 
| | -------------- | - | ---------- | 
| |                |   |            | 
| | 2020           | $ | 10,000     | 
| | 2022           |   | 25,000     | 
| | 2023           |   | 23,000     | 
| | 2024           |   | 1,550,000  | 
| | 2025           |   | 5,316,000  | 
| | 2026           |   | 1,951,000  | 
| | 2027           |   | 4,523,000  | 
| | 2028           |   | 1,779,000  | 
| |                |   |            | 
| |                | $ | 15,177,000 | 

The Company evaluates its valuation
  allowance requirements based on projected future operations. When circumstances
  change and this causes a change in managements judgment about the
  recoverability of deferred tax assets, the impact of the change on the valuation
  allowance is reflected in current income. As management of the Company does not
  currently believe that it is more likely than not that the Company will receive
  the benefit of this asset, a valuation allowance equal to the deferred tax asset
  has been established at both December 31, 2008 and December 31, 2007.

As at December 31, 2008, the Company
  is in arrears on filing its statutory income tax returns and the amounts
  presented above are based on estimates. The actual losses available could differ
  from these estimates.

---

Acrongenomics, Inc. 
  (A Development Stage Company) 
  Notes
  to the Financial Statements 
  December 31, 2008 and 2007 
  (Stated in US
    Dollars)  Page 20

|Note 9  | Income Taxes  (contd)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|        | Uncertain Tax Positions                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|        | The Company has adopted FASB Interpretation No. 48,
      "Accounting for Uncertainty in Income Taxes" ("FIN 48"). FIN 48 prescribes
      a recognition threshold and measurement attribute for the recognition and
      measurement of tax positions taken or expected to be taken in income tax
      returns. FIN 48 also provides guidance on de-recognition of income tax
      assets and liabilities, classification of current and deferred income tax
      assets and liabilities, and accounting for interest and penalties
      associated with tax positions.                                                                                              
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|        | The Company files income tax returns in the U.S. federal
      jurisdiction, various state and foreign jurisdictions. The Companys tax
      returns are subject to tax examinations by U.S. federal and state tax
      authorities, or examinations by foreign tax authorities until the
      respective statute of limitation. It is subject to tax examinations by tax
      authorities for all taxation years commencing on or after 1999.                                                                                                                                                                                                                         
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|        | Managements analysis of FIN 48 supports the conclusion
      that the Company does not have any accruals for uncertain tax positions as
      of December 31, 2008. As a result, tabular reconciliation of beginning and
      ending balances would not be meaningful. If interest and penalties were to
      be assessed, we would charge interest to interest expense, and penalties
      to other operating expense. It is not anticipated that unrecognized tax
      benefits would significantly increase or decrease within 12 months of the
      reporting date.                                                                                              
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|        | The Company is in arrears on filing its statutory income
      tax returns and is therefore has estimated the expected amount of loss
      carry forwards available once the outstanding returns are filed. The
      Company expects to have significant net operating loss carry forwards for
      income tax purposes available to offset future taxable income.                                                                                                                                                                                                                                                                                                      
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|Note 10 | Supplemental Cash Flow Information                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|        | Investing and financing activities that do not have a
      direct impact on current cash flows are excluded from the statements of
      cash flows.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|        | During the year ended December 31, 2008, the Company
      terminated the services of the former CEO. In accordance with the terms of
      the original employment agreement, the former CEO was to be issued common
      shares of the Company upon the achievement of certain milestones. The
      Company determined the milestones were likely to be achieved and accrued
      the shares to be issued as a liability. Upon the termination of the former
      CEO, the Company had accrued a liability of $491,749 and reallocated this
      balance accrued by reversing the accrued liability and recognizing a
      recovery in the Statement of Operations.
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|        | During the year ended December 31, 2008, the Company
      issued 1,950,000 common shares in respect of consulting fees. The fair
      value of these share issuances was $667,500.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|        | During the year ended December 31, 2008, the Company
      issued 1,300,000 common shares having a fair value of $1,051,000 in
      respect of settling accounts payable for unpaid consulting fees to two
      officers of the Company.                                                                                                                                                                                                                                                                                                                                                                                                                                 

---

Acrongenomics, Inc. 
  (A Development Stage Company) 
  Notes
  to the Financial Statements 
  December 31, 2008 and 2007 
  (Stated in US
    Dollars)  Page 21

|Note 10 | Supplemental Cash Flow Information  (contd)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|        | During the year ended December 31, 2008, the Company
      terminated its development agreement with Molecular. As part of the
      consideration for the termination, Molecular Vision agreed to credit an
      amount totalling $156,615 against amounts owed by the Company to
      Molecular.                                                                                                                                                                                                                                                                                                                                               
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|        | During the year ended December 31, 2007, 750,000 common
      shares were issued to the CEO valued at $0.86 per share, the quoted market
      price on date of agreement, for a total combined value of $645,000 as a
      signing bonus which has been included in management fees. In addition, the
      Company accrued additional management fees based on the value of
      performance shares that were likely to be issued, on a pro-rated time
      basis, since September 3, 2007. As discussed above, during 2008, the CEO
      was terminated and the amount accrued ($491,749) was reversed to the
      Statement of Operations.
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|        | During the year ended December 31, 2008, the Company
      recorded stock option compensation expense of $454,919 (2007: $533,252)
      charged to statement of operations.                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|        | During the year ended December 31, 2007, the Company
      issued 220,000 common shares at $0.50 per share. A portion of the proceeds
      for this issuance were received as at December 31, 2006 and recorded as
      share subscriptions in the amount of $40,000. During the year ended
      December 31, 2007, these proceeds have been utilized for this share
      issuance.                                                                                                                                                                                                                                                            
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|        | During the year ended December 31, 2007, the Company
      issued 126,090 common shares of the Company at $0.50 to $1.10 per share as
      finders fee commission. The total value of these shares was $118,449.                                                                                                                                                                                                                                                                                                                                                                                                                                 
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|        | On December 8, 2007, the Company issued 158,000 commons
      shares at $1.00 per share to settle accounts payable with a consultant.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|        | These transactions were excluded from the statements of
      cash flows.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|Note 11 | Commitments                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        

| | a) | On April 1, 2007, the Company entered into an agreement
      with a director of the Company to serve as President and Chief Operating
      Officer at $7,000 per month. The agreement is for three years ending March
      31, 2010.
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                        
| | b) | On April 1, 2007, the Company entered into an agreement
      with a director of the Company to provide services as Chief Technology
      Officer at $4,500 per month. The agreement is for three years ending March
      31, 2010.  

---

Acrongenomics, Inc. 
  (A Development Stage Company) 
  Notes
  to the Financial Statements 
  December 31, 2008 and 2007 
  (Stated in US
    Dollars)  Page 22

|Note 11 | Commitments  (contd)
|------- | ----------------------

| | c) | On September 3, 2007, the Company entered into an
      agreement with a director of the Company to provide services as CEO. The
      agreement was for three years ending September 3, 2010. According to the
      terms of the agreement, the CEO would receive 750,000 common shares of the
      Company as a signing bonus and would be entitled to receive an additional
      1,750,000 common shares as performance bonuses as follows:
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |    | i)                                                                                                                                                                                                                                                                                                                                                                                                                                               
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |    | ii)                                                                                                                                                                                                                                                                                                                                                                                                                                              
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |    | During the year ended December 31, 2008, the CEO resigned
      from the Company and forfeited the additional 1,750,000 performance shares
      to be received on attaining the performance conditions
      specified.                                                                                                                                                                                                                         
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | d) | On March 28, 2008, the Company entered into a consulting
      agreement at $10,000 per month. The agreement is for one year ending March
      27, 2009, except if terminated by the parties, with the option to be
      renewed for an additional year.                                                                                                                                                                                       
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | e) | Effective as of October 1, 2008, the Company entered into
      a management and operational services agreement with Vardisto Investments
      Limited (Vardisto). The term of this agreement is for two years and will
      renew for an additional one year unless either party gives the other
      thirty days prior written notice of its intention not to further renew
      this agreement.                                        
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |    | The Company will pay Vardisto a monthly fee of $5,000. An
      initial payment of $10,000 was paid upon the signing of the
      agreement.                                                                                                                                                                                                                                                                                                     
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |    | Either party may terminate the agreement by giving 30
      days written notice.                                                                                                                                                                                                                                                                                                                                                                 

|Note 12 | Contingencies                                                                                                                                                                                                                                                                                                                                                                                                      
|------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|        |                                                                                                                                                                                                                                                                                                                                                                                                                    
|        | The Company is subject to various amounts claimed arising
      in the ordinary course of business and which are in dispute. There has not
      been any material amount accrued in the financial statements with respect
      to the various amounts claimed due to the Company being unable to make a
      reasonable estimate of any potential liability resulting from the
      resolution of these claims.

---

Acrongenomics, Inc. 
  (A Development Stage Company) 
  Notes
  to the Financial Statements 
  December 31, 2008 and 2007 
  (Stated in US
    Dollars)  Page 23

|Note 13 | Subsequent Event                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|        | Subsequent to December 31, 2008, the Company agreed to
      acquire 60% of the outstanding shares of Vardisto Investments Ltd.
      (Vardisto), a private Cyprus company which has beneficial ownership in
      intellectual property. As consideration for this acquisition, the Company
      intends to issue 9,000,000 common shares of the Company to the vendor.
      This acquisition will be accounted for in accordance with SFAS 141(R)
      whereby the Company will recognize the assets acquired, the liabilities
      assumed, and any non-controlling interest in Vardisto at the acquisition
      date, measured at their fair values as of that date.

---

- 24 -

ITEM 9A(T). CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

As required by paragraph (b) of Rules 13a-15 or 15d-15 under
the Exchange Act, our principal executive officer and principal financial
officer evaluated our companys disclosure controls and procedures (as defined
in Rules 13a-15(e) and 15d-15(e) of the Exchange Act) as of December 31, 2008.
Based on this evaluation, these officers concluded that as of December 31, 2008,
these disclosure controls and procedures were not effective. These officers
determined that our disclosure controls and procedures were not adequate to
ensure that the information required to be disclosed by our company in reports
we file or submit under the Exchange Act is recorded, processed, summarized and
reported within the time periods specified in the rules and forms of the
Securities and Exchange Commission and include controls and procedures designed
to ensure that such information is accumulated and communicated to our companys
management, including our principal executive officer and principal financial
officer, to allow timely decisions regarding required disclosure.

Managements Report on Internal Control over Financial
Reporting.

Our companys management is responsible for establishing and
maintaining adequate internal control over financial reporting (as defined in
Rules 13a-15(f) and 15d-15(f) of the Exchange Act) for our company. Our
companys internal control over financial reporting is designed to provide
reasonable assurance, not absolute assurance, regarding the reliability of
financial reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting principles in the
United States of America. Internal control over financial reporting includes
those policies and procedures that: (i) pertain to the maintenance of records
that, in reasonable detail, accurately and fairly reflect the transactions and
dispositions of our companys assets; (ii) provide reasonable assurance that
transactions are recorded as necessary to permit preparation of financial
statements in accordance with generally accepted accounting principles in the
United States of America, and that our companys receipts and expenditures are
being made only in accordance with authorizations of our management and
directors; and (iii) provide reasonable assurance regarding prevention or timely
detection of unauthorized acquisition, use or disposition of our assets that
could have a material effect on the financial statements.

Because of its inherent limitations, internal control over
financial reporting may not prevent or detect misstatements. In addition,
projections of any evaluation of effectiveness to future periods are subject to
the risk that controls may become inadequate because of changes in conditions
and that the degree of compliance with the policies or procedures may
deteriorate.

Our management, with the participation of our principal
executive and principal financial officers, conducted an evaluation of the
effectiveness of our internal control over financial reporting as of December
31, 2008, based on the criteria set forth by the Committee of Sponsoring
Organizations of the Treadway Commission in Internal Control  Integrated
Framework. Based on its evaluation under the framework in Internal
ControlIntegrated Framework, issued by the Committee of Sponsoring
Organizations of the Treadway Commission, our management, with the participation
of our principal executive and principal financial officer concluded that our
internal control over financial reporting was not effective as of December 31,
2008, due to the existence of significant deficiencies constituting material
weaknesses, as described in greater detail below. A material weakness is a
control deficiency, or combination of control deficiencies, such that there is a
reasonable possibility that a material misstatement of the annual or interim
financial statements will not be prevented or detected on a timely basis.

This report does not include an attestation report of our
registered public accounting firm regarding internal control over financial
reporting. Managements report was not subject to attestation by our registered
public accounting firm pursuant to temporary rules of the SEC that permit us to
provide only management's report in this annual report on Form 10-K.

---

- 25 -

Weaknesses Identified

Management has identified material weaknesses in our internal
control processes over procurement and disbursements, primarily related to lack
of segregations of duties.

More specifically, management has identified the following
weaknesses:

- Our company does not have a code of conduct or ethics;
- Our company does not have Human Resources policies and Procedures and
  Function Activities are not clearly defined;
- Our company does not have a specific Mission Statement or Key Performance
  indicators;
- Tax returns have not been filed for our company. These are nil returns, as
  our company has not achieved profitability yet.
- Our company's accounting staff does not have sufficient technical
  accounting knowledge relating to accounting for income taxes and complex US
  GAAP matters. Management corrected any errors prior to the release of our
  company's December 31, 2008 financial statements.

Because of the inherent limitations in all control systems, no
evaluation of controls can provide absolute assurance that all control issues,
if any, within our company have been detected. These inherent limitations
include the realities that judgments in decision-making can be faulty and that
breakdowns can occur because of simple error or mistake.

We intend to implement remediation measures for the material
weaknesses described in this annual report. Such remediation activities include
the following:

| | (1) | We intend to appoint independent members to our audit
      committee in the 2009 fiscal year; and                                                                                                          
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                             
| | (2) | We intend to update the documentation of our internal
      control processes, including formal risk assessment of our financial
      reporting processes as well as codify a code of conduct and
  ethics.
| |     |                                                                                                                                                                                                             
| | (3) | We intend to update our business plan to include a
      Mission Statement and document the Companys key performance
      indicators.                                                                     
| |     |                                                                                                                                                                                                             
| | (4) | We intend to engage the services of a professional tax
      preparer conversant with US tax matters in order that we catch up on our
      US tax filings in arrears.                                      
| |     |                                                                                                                                                                                                             
| | (5) | We intend to engage the services of an independent
      consultant with sufficient expertise in complex US GAAP matters to assist
      us in the preparation of our financial statements                  

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial
reporting during the fourth quarter ended December 31, 2008 that have materially
affected, or are reasonably likely to materially affect our internal control
over financial reporting.

Certificates

Certificates with respect to disclosure controls and procedures
and internal control over financial reporting under Rules 13a-14(a) or 15d-14(a)
of the Exchange Act are attached to this annual report on Form 10-K.

ITEM 9B OTHER INFORMATION

None

---

- 26 -

PART III

ITEM 10 DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE
GOVERNANCE

Directors and Executive Officers, Promoters and Control
  Persons

As at December 31, 2008, our directors and executive officers,
their age, positions held, and duration of such, are as follows:

Name
      Position Held with our
        Company
      Age
      Date First Elected or AppointedDr. Dimitri
      Goundis
    Former Chief Executive Officer(1)
    47
    September 3, 2007Platon Tzouvalis
    Vice President & Director President
    43
    February 14, 2005 October 5, 2006Ron Lizée
    Chief Financial Officer & Director
    50
    June
      4, 2004Dr. Manos
      Topoglidis
    Chief Technology Officer and Director
    35
    February 14, 2006Dr. Evan Manolis
    Director Chairman
    49
    May 8,
      2007 September 2, 2008


(1) Dr. Goundis resigned on September 2, 2008

Family Relationships

There are no family relationships between any director or
executive officer.

Certain Significant Employees

Where the registrant employs persons such as production
managers, sales managers, or research scientists who are not executive officers
but who make or are expected to make significant contributions to the business
of the registrant, such persons shall be identified and their background
disclosed to the same extent as in the case of executive officers. Such
disclosure need not be made if the registrant was subject to section 13(a) or
15(d) of the Exchange Act or was exempt from section 13(a) by section
12(g)(2)(G) of such Act immediately prior to the filing of the registration
statement, report, or statement to which this Item is applicable.

As at December 31, 2008, our significant employees, their age,
  positions held, and duration of such, are as follows:

Name
      Position Held with our Company
      Age
      Date First AppointedKailash C. Sharma
    Scientific Advisory Board
    54
    September 2, 2008Constantine
      Poulios
    General Manager and Former Past President(1)
    37
    April
      1, 2007


(1)Mr. Poulios resigned as President on October 5,
2006

Business Experience

The following is a brief account of the education and business
experience of directors, executive officers and significant employees during at
least the past five years, indicating their principal occupation during the
period, and the name and principal business of the organization by which they
were employed.

Platon Tzouvalis  President and Director

Platon Tzouvalis, M.Sc., was appointed Vice President of our
company on February 14, 2006 and subsequently as the President on October 5,
2006. As a Biochemist and ex-Abbott Laboratories Associate, he is an experienced
pharmaceutical industry professional. He has been a member of our companys
Scientific Advisory Board since May 2004. His expertise lies in the areas of
Quality Control, Operational Procedures as well as Pharmaceutical Product and
Process Improvement. He received his B.Sc. Degree in Biochemistry from the
University of Illinois in 1990 and his Master's Degree in the same field from
DePaul University at Chicago in 1995.

---

- 27 -

Mr. Tzouvalis' earlier career includes working as a Research
Chemist in collaboration with the University of Illinois at Chicago, holding the
position of Research and Development Chemist at SynQuest, Inc. and as Advanced
Quality Assurance Specialist of Organic Operations and then Project Manager in
Bioanalytical Quality Assurance for Abbott Laboratories. Mr. Tzouvalis has also
been awarded with the Abbott Diagnostics Division Science Award of 2002 as part
of the Organic Operation Remediation Team.

Ron Lizée  Chief Financial Officer and Director

In June 2004, Ron Lizée was appointed Director and Chief
Financial Officer of Acrongenomics Inc.

Mr. Lizée is the owner/operator of Lizée Gauthier, Certified
General Accountants where he has practiced since 1982. Mr. Lizée has over 25
years experience in the fields of Taxation, Accounting and Auditing. He
graduated from the University of Saskatchewan, Canada in 1981 with a B. Comm.,
majoring in Accounting and gained his Certified General Accountant (CGA)
designation in 1987, and Certified Financial Planner (CFP) designation in 1993.
Mr. Lizée has experience in financial management within public companies having
served as a director and Chief Financial Officer during 1995 to 1999. He is also
a Director and CFO of PreAxia Health Care System Inc. a OTCBB public company. He
is the former owner and Chief Executive Officer of a franchise chain operating
in several Canadian provinces. Mr. Lizée is also the CEO and President of
Gemstar Capital Properties Inc., a private corporation, which is involved in
Land Development Projects.

Dr. Evan Manolis  Chairman and Director

Dr. Manolis was appointed a director of our company on May 8,
2007. Dr. Manolis received his B.S. from the University of Illinois at Chicago
in 1987 and his M.D. in surgery from Southern Illinois University Medical School
in 1991. He received extensive postgraduate training in general surgery
internship and residency from the Medical College in Ohio. Dr. Manolis practices
surgery in Chicago and Orland Park, Illinois and has been in the profession for
sixteen years.

Dr. Manos Topoglidis  Chief Technology Officer and
Director

Dr. Topoglidis was appointed as Chief Technology Officer, as a
director of our company and to the Scientific Advisory Board on February 24,
2006. He received his Bachelors of Science from Kings College (University of
London) in 1996, his MSc in Biochemistry from Imperial College in London, UK in
1997 and his Ph.D. in Chemistry (Biosensors and Nanomaterials) from Imperial
College in London, UK in 2001. His research interests and expertise lie in the
areas of Biosensors, Nanomaterials, Biotechnology and Nanotechnology. He has
worked in research at the Center of Electronic Materials and Devices of Imperial
College in London, UK and as manager of European and National programs of the
MESL laboratory of the National Centre for Scientific Research, Demokritos in
Athens. He is a member of the Electrochemical and British Biochemical Societies.
Dr. Topoglidis has 15 scientific publications during his eight years of research
and has presented his work in ten U.S./international conferences.

Dr. Topoglidis has impressive experience leading international
research teams in academia to unlock nanotechnology solutions. He ranks among
the first to extensively research the use of nanoporous surfaces for biosensing
applications and has written numerous original nanotechnology-related
publications which have been cited worldwide.

Dr. Kailash C. Sharma  Scientific Advisory Board

Dr. Sharma was appointed as a member of the Scientific Advisory
Board in July of 2008. Dr. Sharma has over 25 years of clinical experience in
the areas of Pulmonary and Internal medicine. He is a medical graduate from the
University of Delhi, India, 1981, received his fellowships to the Royal College
of Physicians in Ireland and the UK in 1985 and is ABIM certified in the USA for
Internal Medicine, Pulmonary Diseases and Critical Care Medicine with 13
publications to his credit. Dr. Sharma is currently a practicing physician in
the areas of Pulmonary/critical care in the Chicago area.

---

- 28 -

Involvement in Certain Legal Proceedings

Our directors, executive officers, or control persons have not
been involved in any of the following events during the past five years:

| | 1. | any bankruptcy petition filed by or against any business
      of which such person was a general partner or executive officer either at
      the time of the bankruptcy or within two years prior to that
  time;                                                                                                            
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                
| | 2. | any conviction in a criminal proceeding or being subject
      to a pending criminal proceeding (excluding traffic violations and other
      minor offences);                                                                                                                                                                 
| |    |                                                                                                                                                                                                                                                                                                                                
| | 3. | being subject to any order, judgment, or decree, not
      subsequently reversed, suspended or vacated, of any court of competent
      jurisdiction, permanently or temporarily enjoining, barring, suspending or
      otherwise limiting his involvement in any type of business, securities or
      banking activities; or
| |    |                                                                                                                                                                                                                                                                                                                                
| | 4. | being found by a court of competent jurisdiction (in a
      civil action), the Commission or the Commodity Futures Trading Commission
      to have violated a federal or state securities or commodities law, and the
      judgment has not been reversed, suspended, or
vacated.                                           

Section 16(a) Beneficial Ownership Compliance

Section 16(a) of the Securities Exchange Act requires our
executive officers and directors, and persons who own more than 10% of our
common stock, to file reports regarding ownership of, and transactions in, our
securities with the Securities and Exchange Commission and to provide us with
copies of those filings. Based solely on our review of the copies of such forms
received by us, or written representations from certain reporting persons, we
believe that during fiscal year ended December 31, 2008, all filing requirements
applicable to its officers, directors and greater than ten percent beneficial
owners were complied with, with the exception of the following:

Name
    Number of Late Reports
    Number of Transactions Not
      Reported on a Timely Basis
    Failure to File Requested
      FormsPlaton Tzouvalis
    Nil
    Nil
    NilRon Lizée
    2
    2
    NilDr. Manos
      Topoglidis
    Nil
    Nil
    NilDr. Evan Manolis
    2
    2
    Nil


Code of Ethics

We have not yet adopted a Code of Ethics but intend to do so in
the near future.

Nominating Committee

We do not have a Nominating Committee, our entire board of
director performs the functions of a Nominating Committee and oversees the
process by which individuals may be nominated to our board of directors.

The current size of our board of directors does not facilitate
the establishment of a separate committee. We hope to establish a separate
Nominating Committee consisting of independent directors, if the number of our
directors is expanded.

Audit Committee

We do not have a standing audit committee at the present time.
Our board of directors has determined that we do not have a board member that
qualifies as an "audit committee financial expert" as defined in Item
407(d)(5)(ii) of

---

- 29 -

Regulation S-K, nor do we have a board member that qualifies as
independent as the term is used in Item 7(d)(3)(iv) of Schedule 14A under the
Securities Exchange Act of 1934, as amended.

We believe that our board of directors is capable of analyzing
and evaluating our financial statements and understanding internal controls and
procedures for financial reporting. The board of directors of our company does
not believe that it is necessary to have an audit committee because we believe
that the functions of an audit committee can be adequately performed by the
board of directors. In addition, we believe that retaining an independent
director who would qualify as an audit committee financial expert would be
overly costly and burdensome and is not warranted in our circumstances given the
early stages of our development and the fact that we have not generated any
revenues from operations to date.

Audit Committee Financial Expert

Our board of directors has determined that it does not have a
member of the audit committee that qualifies as an audit committee financial
expert as defined in Item 401(e) of Regulation S-K

We believe that our entire board of directors is capable of
analyzing and evaluating financial statements that present a breadth and level
of complexity of accounting issues that are generally comparable to the breadth
and complexity of the issues reasonably expected to be raised by our company. In
addition, we believe that retaining an independent director who would qualify as
an audit committee financial expert would be overly costly and burdensome and
is not warranted in our circumstances given the early stages of our development
and the fact that we have not generated revenues to date.

ITEM 11. EXECUTIVE COMPENSATION

Summary Compensation

The particulars of compensation paid to the following persons:

- our principal executive officer;
- each of our two most highly compensated executive officers who were serving
  as executive officers at the end of the year ended December 31, 2008 who had
  total compensation exceeding $100,000; and

up to two additional individuals for whom disclosure would have
been provided under (b) but for the fact that the individual was not serving as
our executive officer at the end of the most recently completed financial year,
who we will collectively refer to as the named executive officers, of our years
ended December 31, 2008 and, 2007 and 2006, are set out in the following summary
compensation table:

Name and principal
      position
    Year
    Salary($)
    **Bonus**
      ($)
    Stock awards
      ($)
    Option awards
      ($)
    Non-equity incentive plancompensation ($)
    Nonqualified deferred
      **compensation** earnings ($)
    All other
      compensation ($)
    Total ($)(a)
    (b)
    (c)
    (d)
    (e)
    (f)
    (g)
    (h)
    (i)
    (j)Dr. Dimitri Goundis Former
      CEO(1)
    2008 2007
    Nil Nil
    Nil Nil
    Nil 923,658
    Nil Nil
    Nil Nil
    Nil Nil
    Nil Nil
    Nil 923,658Platon Tzouvalis(2)
    2008 2007
    84,000 615,150
    Nil Nil
    59,250 Nil
    147,827 409,820
    Nil Nil
    Nil Nil
    Nil Nil
    291,077 1,024,470Ron Lizée
    2008 2007
    85,244 Nil
    Nil Nil
    133,500 Nil
    24,784 21,804
    Nil Nil
    Nil Nil
    Nil Nil
    243,528 21,804Dr. Manos Topoglidis
    2008 2007
    54,000 332,400
    Nil Nil
    31,600 Nil
    33,045 29,073
    Nil Nil
    Nil Nil
    Nil Nil
    118,645 361,473


(1) Dr. Goundis was appointed to CEO on September 3,
2007 and resigned on September 2, 2008 (2) Platon Tzouvalis and
Manos Topoglidis commenced employment April, 2007(3) Refer to
Note 8 of the financial statements for the year ended December 31, 2008 for the
assumptions used in the Black- Scholes fair value calculation model.

---

- 30 -

Outstanding Equity Awards at Fiscal Year-End

The following table sets forth for each named executive officer
certain information concerning the outstanding equity awards as of December 31
2008.

OUTSTANDING
        EQUITY AWARDS AT FISCAL YEAR-ENDOPTION
        AWARDS
      STOCK
      AWARDSName (a)
      Number of Securities Underlying Unexercised Options (#) Exercisable(b)
      Number of Securities Underlying Unexercised Options (#) **Unexercisable** (c)
      Equity Incentive Plan
        Awards: Number of Securities Underlying Unexercised Unearned Options
        (#) (d)
      Option
        Exercise Price($) (e)
      Option **Expiration**Date (f)
      Numberof
        Shares or Units of Stock That
        Have Not**Vested** (#) (g)
      Market **Value
        of**Shares or Units ofStock
        That **Have Not**Vested ($) (h)
      Equity Incentive Plan Awards:
        **Number of**Unearned **Shares,
        Units**or Other Rights That**Have
        Not**Vested (#) (i)
      Equity Incentive Plan Awards:
        Market or **Payout Value** of Unearned
        **Shares, Units** or Other **Rights
        That** Have Not Vested (#)
        (j)Dr. Dimitri 
        Goundis 
        Former 
        CEO(1)
      Nil
      Nil
      
      Nil
      Nil
      Nil
      Nil
      Nil
      NilPlaton 
        Tzouvalis
      187,500 
        600,000
      62,500 
        Nil
      Nil
        
        Nil
      0.50
        
        1.00
      Feb
        1217 
        Mar 2212
      Nil
      Nil
      Nil
      NilRon Lizée
      112,500 
        100,000
      37,500
      Nil
      0.50
        
        2.50
      Feb
        1217 
        May 316
      Nil
      Nil
      Nil
      NilDr. Manos 
        Topoglidis
      150,000
      50,000
      Nil
      0.50
      Feb 12 17
      Nil
      Nil
      Nil
      Nil


(1) Dr. Goundis resigned on September 2, 2008

Option exercises and stock vested

OPTION
        EXERCISES AND STOCK VESTEDOPTION
        AWARDS
      STOCK
        AWARDSName (a)
      Number of Shares Acquired on
        Exercise (#) (b)
      Value Realized on Exercise
        ($) (c)
      Number of Shares Acquired on
        Vesting (#) (d)
      Value Realized on Vesting
        ($) (e)Dr. Dimitri Goundis
      Nil
      Nil
      Nil
      NilPlaton Tzouvalis
      Nil
      Nil
      Nil
      NilRon Lizée
      Nil
      Nil
      Nil
      NilDr. Manos Topoglidis
      Nil
      Nil
      Nil
      Nil


Compensation of Directors

Our directors may be paid for their expenses incurred in
attending each meeting of the directors. In addition to expenses, our directors
may be paid a sum for attending each meeting of the directors or may receive a
stated salary as director. No payment precludes any director from serving our
company in any other capacity and being compensated for such service. Members of
special or standing committees may be allowed similar reimbursement and
compensation for attending committee meetings.

We reimburse our directors for expenses incurred in connection
with attending board meetings, but did not pay directors fees or other cash
compensation for services rendered as a director in the periods ended December
31, 2008 and 2007.

---

- 31 -

Name
    Fees Earned or
      Paid in Cash ($)
    Stock
      Awards ($)
    Option
      Awards ($)
    Non-Equity
      Incentive Plan Compensation ($)
    Change in Pension Value
      and Nonqualified Deferred
      Compensation Earnings
    All Other
      Compensation ($)
    Total
      ($)(a)
    (b)
    (c)
    (d)
    (e)
    (f)
    (g)
    (h)Platon Tzouvalis
    Nil
    Nil
    Nil
    Nil
    Nil
    Nil
    NilRon Lizée
    Nil
    Nil
    Nil
    Nil
    Nil
    Nil
    NilDr. Manos Topoglidis
    Nil
    Nil
    Nil
    Nil
    Nil
    Nil
    NilDr. Evan Manolis
    Nil
    Nil
    Nil
    Nil
    Nil
    Nil
    Nil


Long-Term Incentive Plans

There are no arrangements or plans in which we provide pension,
retirement or similar benefits for directors or executive officers, except that
our directors and executive officers may receive stock options at the discretion
of our board of directors. We do not have any material bonus or profit sharing
plans pursuant to which cash or non-cash compensation is or may be paid to our
directors or executive officers, except that stock options may be granted at the
discretion of our board of directors.

We have no plans or arrangements in respect of remuneration
received or that may be received by our executive officers to compensate such
officers in the event of termination of employment (as a result of resignation,
retirement, change of control) or a change of responsibilities following a
change of control, where the value of such compensation exceeds $60,000 per
executive officer.

Compensation Committee

We do not have a Compensation Committee.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT AND RELATED STOCKHOLDER MATTERS.

Securities authorized for issuance under equity
compensation plans

We have no long-term incentive plans.

The following table summarizes certain information regarding
our equity compensation plan as at December 31, 2008:

Plan
      Category
    Number of
      Securities to be Issued Upon Exercise of Outstanding
      Options, Warrants and Rights
    Weighted-Average Exercise Price
      of Outstanding Options, Warrants and Rights
    Number of Securities Remaining Available
      for Future Issuance Under Equity Compensation
      Plans (Excluding Securities Reflected in
      Column)Equity compensation plans approved by security
      holders
    2,100,000
    $0.86
    500,000


---

- 32 -

Plan Category
      Number of Securities to
      be Issued Upon Exercise of Outstanding Options,
      Warrants and Rights
      Weighted-Average
      Exercise Price of Outstanding Options,
      Warrants and Rights
      Number of Securities Remaining Available for
      Future Issuance Under Equity Compensation
      Plans (Excluding Securities Reflected in
      Column)Equity
      compensation plans not approved by security holders
    Nil
    Nil
    NilTotal
    2,100,000
    $0.86
    500,000


Security ownership of certain beneficial owners

In the following tables, we have determined the number and
percentage of shares beneficially owned in accordance with Rule 13d-3 of the
Exchange Act based on information provided to us by our controlling shareholder,
executive officers and directors, and this information does not necessarily
indicate beneficial ownership for any other purpose. In determining the number
of shares of our common stock beneficially owned by a person and the percentage
ownership of that person, we include any shares as to which the person has sole
or shared voting power or investment power, as well as any shares subject to
warrants or options held by that person that are currently exercisable or
exercisable within 60 days.

Security ownership of management

(1) Title of class
      (2) Name and address of beneficial
        owner
      (3) Amount and nature of beneficial
        ownership
      (4) Percent of class1common stock
      Dimitrios Goundis 
        Str. Katsimitrov 10 
        Ioannina, Greece 45442
      1,000,000
      Direct
      4.06%common stock
      Ron Lizée 
        c/o Lizeé Gauthier CGA 
        202-3550 Taylor St. E 
        Saskatoon, SK Canada 
        S7H 5H9
      600,000 2
      Direct
      2.43%common stock
      Evan T. Manolis 
        15300 West Ave, Suite 310 
        Orland Park, IL 60462
      225,993
      Direct
      0.91%common stock
      Manos Topoglidis 
        Panagi Tsaldari 5 Marcousi 
        Athens Greece 15122
      600,000 3
      Direct
      2.43%common stock
      Platon Tzouvalis 
        4 Isminis St. Chalandri 
        Athens, Greece 15232
      1,600,000 4
      Direct
      6.30%TOTAL
      4,025,993
      
      16.33%


1 Percentage of ownership is
based on 24,597,981 common shares issued and outstanding as of April 14, 2009.
Except as otherwise indicated, we believe that the beneficial owners of the
common stock listed above, based on information furnished by such owners, have
sole investment and voting power with respect to such shares, subject to
community property laws where applicable. Beneficial ownership is determined in
accordance with the rules of the SEC and generally includes voting or investment
power with respect to securities. Shares of common stock subject to options or
warrants currently exercisable, or exercisable within 60 days, are deemed
outstanding for purposes of computing the percentage ownership of the person
holding such option or warrants, but are not deemed outstanding for purposes of
computing the percentage ownership of any other person. 2Includes 350,000 shares of common stock and 250,000 stock options
exercisable within 60 days. 3Includes 400,000 shares of common
stock and 200,000 stock options exercisable within 60 days. 4Includes 750,000 shares of common stock and 850,000 stock options
exercisable within 60 days.

---

- 33 -

Changes in Control

We are unaware of any contract or other arrangement the
operation of which may at a subsequent date result in a change of control of our
company.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND
DIRECTOR INDEPENDENCE

Transactions with related persons

Except as described below, none of the following parties has,
since our date of incorporation, had any material interest, direct or indirect,
in any transaction with us or in any presently proposed transaction that has or
will materially affect us, other than as noted in this section:

| | (i)   | any of our directors or officers;                                                                                                                                          
| | ----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (ii)  | any person proposed as a nominee for election as a
      director;                                                                                                         
| | (iii) | any person who beneficially owns, directly or indirectly,
      shares carrying more than 5% of the voting rights attached to our
      outstanding shares of common stock;
| | (iv)  | any of our promoters; and                                                                                                                                                  
| | (v)   | any member of the immediate family (including spouse,
      parents, children, siblings and in- laws) of any of the foregoing
      persons.                               

| | 1. | For the fiscal year ended 2008, a total of $85,244 in
      fees was billed to our Company by Lizée Gauthier Certified General
      Accountants, of which our Companys Chief Financial Officer, Mr. Lizée, is
      the proprietor. These fees were invoiced at the same billable rate as
      other clients of the firm.                                                                                 
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                                              
| | 2. | During the fiscal year ended December 31, 2008, the
      Company issued 350,000 shares to the CFO for past services for a value
      calculated at $133,500.                                                                                                                                                                                                                                               
| |    |                                                                                                                                                                                                                                                                                                                                                                                                              
| | 3. | During the fiscal year ended December 31, 2008, the
      Company issued 750,000 shares to our President for past services of which
      $533,250 was recorded in the fiscal year ended December 31, 2007 and
      $59,250 in the fiscal year ended December 31, 2008. In addition, the
      Company also incurred consulting fees to the President of $84,000 for the
      year ended December 31, 2008.
| |    |                                                                                                                                                                                                                                                                                                                                                                                                              
| | 4. | During the fiscal year ended December 31, 2008, the
      Company issued 400,000 shares to our Scientific Advisor of which the value
      of $284,400 was recorded in the fiscal year ended December 31, 2007 and
      $31,600 in the fiscal year ended December 31,
2008.                                                                                                                                 

Employment Contracts

Other than as described below, we are not party to any
employment contracts with our directors and officers:

Acrongenomics has two employment contracts with Mr. Platon
Tzouvalis, our President and Dr. Manos Topoglidis, our Chief Technology Officer.
They are currently bound by a three year employment agreement commencing April
1, 2007 and ending March 31, 2010.

---

- 34 -

ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES.

Audit Fees

The following table sets forth the fees billed to the Company
for professional services rendered by the Company's independent registered
public accounting firm, for the years ended December 31, 2008 and 2007:

Fees
    
    2008
    
    
    2007Audit Fees
    $
    102,236
    
    $
    45,173Audit related Fees
    
    Nil
    
    
    NilTax fees
    
    Nil
    
    
    NilOther fees
    
    Nil
    
    
    NilTotal Fees
    $
    102,236
    
    $
    45,173


Audit Fees. Consist of fees billed for professional
services rendered for the audits of our financial statements, reviews of our
interim consolidated financial statements included in quarterly reports,
services performed in connection with filings with the Securities and Exchange
Commission and related comfort letters and other services that are normally
provided by BDO Dunwoody LLP for the fiscal years ended December 31, 2008 and
2007, in connection with statutory and regulatory filings or engagements.

Tax Fees. Consist of fees billed for professional
services for tax compliance, tax advice and tax planning. These services include
assistance regarding federal, state and local tax compliance and consultation in
connection with various transactions and acquisitions.

Policy on Pre-Approval by Audit Committee of Services Performed
  by Independent Auditors

We do not use BDO Dunwoody LLP, for financial information
system design and implementation. These services, which include designing or
implementing a system that aggregates source data underlying the financial
statements or generates information that is significant to our financial
statements, are provided internally or by other service providers. We do not
engage BDO Dunwoody LLP to provide compliance outsourcing services.

Effective May 6, 2003, the Securities and Exchange Commission
adopted rules that require that before BDO Dunwoody LLP is engaged by us to
render any auditing or permitted non-audit related service, the engagement be:

- approved by our audit committee (the functions of which are performed by
  our entire board of directors); or
- entered into pursuant to pre-approval policies and procedures established
  by the board of directors, provided the policies and procedures are detailed
  as to the particular service, the board of directors is informed of each
  service, and such policies and procedures do not include delegation of the
  board of directors' responsibilities to management.

Our entire board of directors pre-approves all services
provided by our independent auditors. All of the above services and fees were
reviewed and approved by our sole director either before or after the respective
services were rendered.

Our board of directors have considered the nature and amount of
fees billed by BDO Dunwoody LLP and believe that the provision of services for
activities unrelated to the audit is compatible with maintaining BDO Dunwoody
LLPs independence.

---

- 35 -

PART IV

ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES.

Exhibits required by Item 601 of Regulation S-K:

Exhibit No.
      Document Name(3)
      Articles of Incorporation and By-laws3.1
      Articles of Incorporation
          (attached as an exhibit to our Registration Statement on Form 10-SB
          filed May 24, 2002, as amended).3.2
      Bylaws, as amended (attached
          as an exhibit to our Registration Statement on Form 10- SB filed May
          24, 2002, as amended).(10)
      Material Contracts10.1
      Agreement for the Sale of
          Stock between our company and Dr. Leftheris Georgakopoulos dated February
          13, 2006 (attached as an exhibit to our Current Report on Form 8-K filed
          February 16, 2006).10.2
      Development Agreement between
          our company and Molecular Vision Limited. (attached as an exhibit to
          our Current Report on Form 8-K filed February 20, 2007).10.3
      Employment Agreement dated
          September 3, 2007 between our company and Dr. Dimitris Goundis (attached
          as an exhibit to our Current Report on Form 8-K filed September 28,
          2007).10.4
      Letter Agreement dated February
          1, 2008 with Molecular Vision Limited (attached as an exhibit to our
          Current Report on Form 8-K filed February 19, 2008).10.9
      Royalty Agreement dated November
          13, 2008, with Molecular Vision. (attached as an exhibit to our current
          report on Form 8-K filed on November 20, 2008)10.10
      Supplemental Agreement to
          the Subscription and Shareholders Agreement relating to Molecular
          Vision Limited dated November 13, 2008 (attached as an exhibit to our
          current report on Form 8-K filed on November 20, 2008)10.11
      Option Agreement dated November
          13, 2008, with Molecular Vision to acquire additional 20000 shares of
          Molecular Vision (attached as an exhibit to our current report on Form
          8-K filed on November 20, 2008)10.12
      Deed of Termination and Release
          dated November 13, 2008, with Molecular Vision (attached as an exhibit
          to our current report on Form 8-K filed on November 20, 2008)10.13
      Share Exchange Agreement dated
          January 31, 2009 between our company, Vardisto Investments Limited and
          a certain shareholder of Vardisto Investments Limited (attached as an
          exhibit to our current report on Form 8-K filed on March 12, 2009)10.14
      Asset Purchase Agreement dated
          January 30, 2009 between Maragrita Hadzopoulou- Cladaras and Halldale
          Ventures Limited (attached as an exhibit to our current report on Form
          8-K filed on March 12, 2009)(16)
      Letter re Change in Certifying Accountant16.1
      Letter from Amisano Hanson
          dated March 19, 2008 (attached as an exhibit to our current report on
          Form 8-K filed March 20, 2008(31)
      Section 302 Certification31.1*
      Rule 13a-14(a) Certification
          of Chief Executive Officer.31.2*
      Rule 13a-14(a) Certification
          of Chief Financial Officer.(32)
      Section 906 Certification32.1*
      Certification
          of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as Pursuant
          to Section 906 of the Sarbanes-Oxley Act of 2002.32.2*
      Certification
          of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Pursuant
          to Section 906 of the Sarbanes-Oxley Act of 2002.


* Filed herewith.

---

- 36 -

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the registrant has duly caused this report to
be signed on its behalf by the undersigned, thereunto duly authorized.

ACRONGENOMICS INC.

By:/s/ Platon Tzouvalis Platon Tzouvalis
President & Director (Principal Executive Officer)

Date: April 17, 2009



/s/ Ron Lizée Ron Lizée Chief Financial Officer
& Director (Principal Financial Officer and Principal Accounting
Officer)

Date: April 17, 2009

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



/s/ Platon Tzouvalis Platon Tzouvalis President
& Director (Principal Executive Officer)

Date: April 17, 2009



/s/ Ron Lizée Ron Lizée Chief Financial Officer
& Director (Principal Financial Officer and Principal Accounting
Officer)

Date: April 17, 2009



/s/ Dr. Evan Manolis Dr. Evan Manolis Director
Date: April 17, 2009



/s/ Dr. Manos Topoglidis Dr. Manos Topoglidis
Director Date: April 17, 2009

---