SECURITIES AND EXCHANGE COMMISSION
                       WASHINGTON, D.C.  20549

                             FORM 10-KSB/A

                           ANNUAL REPORT
                PURSUANT TO SECTION 13 or 15(d) OF
                THE SECURITIES EXCHANGE ACT OF 1934
(Mark One)

X    Annual report pursuant to Section 13 or 15(d) of the
     Securities Exchange Act of 1934

     For the fiscal year ended June 30, 2001 or

     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 0-11232
                                 ---------

                      VEREX LABORATORIES, INC.
     ---------------------------------------------------------------
        (Exact name of Registrant as specified in its charter)

           Colorado                          84-0850695
          ----------                        ------------
(State or other jurisdiction              (I.R.S. Employer
of incorporation or organization)        Identification No.)

Building D, Suite 100, 14 Inverness Dr. East, Englewood, CO  80112
-----------------------------------------------------------------------
(Address of principal executive offices)                    (Zip Code)

Registrant's telephone number, including area code:   (303)799-4499
                                                     ----------------
Securities registered pursuant to Section 12(b) of the Act:

      Title of each class            Name of each exchange on
                                         which registered

            None                               None
      -------------------            ------------------------



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

                    Common Stock - No Par Value
                   -----------------------------
                          (Title of class)

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 _______   No ___X___

                        Page 1 of 16
<PAGE>
     The aggregate market value of the voting stock held by
non-affiliates of the Registrant at October 4, 2001 was
approximately $417,000.

     The number of shares outstanding of the Registrant's no par
value common stock as of June 30, 2001, was  2,387,907 shares.

   This Amendment Supersedes Prior Unsigned Draft Filed in Error
   -------------------------------------------------------------
     This amendment is being filed to supersede the draft,
unsigned Report on Form 10-KSB which was filed in error on
November 26, 2001. Such Report should not be relied upon.

                Statement Concerning Rule 12b-21
                --------------------------------
     This Amendment contains the portions of the Report on
Form 10-KSB that Registrant is currently in a position to file.  The
Registrant has omitted the financial statements, selected financial
information and portions of Management's Discussion and
Analysis because certain information necessary to enable
Registrant's officers to provide the required representations to
Registrant's independent auditors, and to enable them to sign a
report containing such information, has only recently been made
available to Patrick Bols, President and Director of Registrant, and
Steve Howe, Chairman of the board and a Director of Registrant.
Upon review of such information such officers will determine
whether they will be able to make the required representations and
to sign an amended report containing such information.


                              PART I

ITEM 1.  BUSINESS
         --------

Background
-------------

The Company was organized under the laws of the State of
Colorado on September 29, 1980.  The Company's objective is to
acquire, develop and market pharmaceutical and health care
products.

     On or about March 31, 2000, PR Pharmaceuticals, Inc. ("PRP"),
a privately held pharmaceuticals company focused on developing
drug delivery systems, acquired 52.95% of the outstanding
common stock of the Company from certain of the shareholders
and directors of the Company.  The selling shareholders received
one share of PRP common stock for each 15 shares of Verex
common stock. PRP agreed to make a tender offer to purchase the
remaining shares of outstanding Verex common stock on a similar
exchange basis or, at PRP's option for a cash purchase price,
provided that audited financials of the Company were issued on or
before November 30, 2000.  That condition was not met, and PRP
has taken the position that it is under no obligation to make any
tender or exchange offer to Verex's shareholders.

Credit Facility
---------------

On March 20, 2000 the Company obtained a $1 million credit
facility with PRP.  Without the credit facility, the Company would
have been unable to continue to operate for any significant period.
The credit facility was also negotiated to provide payment of the
accrued management compensation. On March 22, 2001 this credit
facility became due and payable.  PRP did not extend this credit
facility and the Company is currently in default.  At June 30, 2001,
the Company owed $615,000 in principal and $56,000 in interest

                           Page 2 of 16
<PAGE>
on this credit facility.  In order to enable the Company to pay
accrued management compensation, the Company has negotiated a
series of 90-day notes with PRP.  At June 30, 2001, the Company
had borrowed $45,000 under two notes.  In addition, PRP has
advanced $49,192 on account to enable the Company to pay
operating expenses such as rent and utilities.  The agreement under
which PRP acquired its shares in Verex provides that PRP is
obligated to make certain advances to Verex to fund accrued
salaries.  That obligation is disputed by PRP.  See Item 3 - Legal
Proceedings.   PRP has made no other commitments to continue to
provide funds to Verex and there is no assurance that funds will be
available to support operations or research and development.  See
Management's Discussion - Liquidity & Capital Resources,
below.

Assignment of Certain Future Revenues - Birklea, Ltd.
------------------------------------------------------

     Effective November 30, 1993, the Company entered into a
Credit Agreement with Birklea, Ltd., a major shareholder of the
Company, whereby Birklea, Ltd. agreed to use its best efforts to
provide up to $10,000,000 in financing to the Company.  The note
was secured by the Company's right, title and interest in patent
applications, patents, trade names, know-how and trade secrets
relating to existing and future drug formulations relating to the
drug commonly known as AZT.  In March 1997, the balance
(principal and interest) on this note was $2,185,984, when the
Company and Birklea agreed that the debt was forgiven in
consideration for the assignment of 25% of all future sources of
revenue from the Company's AZTEC formulation, and 5% of all
future revenues from other specified Company drug formulations
up to $4,650,000 and $2,325,000 respectively.  In addition, the
Company agreed to assign to Birklea, Ltd. the AZTEC formulation
in the event it has not licensed it prior to December 31, 1998. This
assignment was not effectuated and on or about, January 27, 2000,
the Company amended this royalty agreement with Birklea, Ltd.,
to change the AZTEC royalty to equal 7.5% of license royalty or
on gross profit received by the Company on sales or licensing from
the Aztec product only and to change all other future royalties to
equal 3% of license royalty or on gross profit received by the
Company on other specified drug formulations.  The Company
further modified the aggregate royalty payment to be limited to
$2,325,000 for all products including AZTEC formulations.

Assignment of Certain Future Revenues - Dr. James M. Dunn
---------------------------------------------------------

     In March, 1997 the Company's president forfeited his right to
receive $2,605,204 in accrued salary and other benefits in
consideration for the Company's assignment to him of 25% of all
future sources of revenue from its AZTEC formulation and 5% of
the income derived from other specified Company drug
formulations up to $2,605,204. The Company amended this royalty
agreement with Dr. Dunn and changed the AZTEC royalty to equal
7.5% of license royalty or on gross profit received by the Company
on sales or licensing from the Aztec product only and to change all
other future royalties to equal 3% of license royalty or on gross
profit received by the Company on other specified drug
formulations.  The Company further modified the aggregate
royalty payment to equal $2,517,339 for all products including
AZTEC formulations.

Licensing Activities
---------------------

The Company has licensing agreements with several foreign-based
pharmaceutical companies covering the Company's patented
constant-release rate formulation of AZTEC, VEREXAMIL, as
well as its proprietary once daily delivery system for diltiazem,
drugs used in the treatment of heart disease and hypertension.
These agreements provide the licensee the exclusive right to
market the formulations in a certain geographical area for a

                            Page 3 of 16
<PAGE>
specified period of time subject to the licensee maintaining high
quality of material and workmanship for the product and require
an initial licensing fee payable to the Company and a royalty to the
Company based on product sales or other arrangements.

The Company has not licensed its technology relating to other
sustained release prescription drugs.

The following table summarizes licensing agreements in existence
at June 30, 2001:

Licensee and
Year of License               Territory                     Drug
----------------              ---------                     ----

Sanofi GmbH                   W. Germany                    Verapamil
(Formerly Labaz GmbH)
(1985)

Laevosan                      Austria                       Verapamil
(1987 & 1988)
Approved 8/93

Trimel Life Sciences          Canada                        Verapamil
(Formerly Galen
 Pharma, Inc.)
(1988)

Trima Pharmaceutical          Israel                        Verapamil,
(1993)                                                      Diltiazem

Trimel Life Sciences          Canada and                    Nifedipine,
(Formerly Galen               United States                 Naproxen,
 Pharma, Inc.)                                              Indomethacin
(1988)

Productos BiotyLDA            Portugal                      Verapamil
(1988)

Metabolic Innovations, LLC    Worldwide                     Verin, CR
                                                            Glucosamine

PR Pharmaceuticals
Agreement regarding patent
prosecution, research and                                   Nanosphere
development)                  Not Applicable                Technology


     Royalties on the foregoing licensing agreements range from 5%
to 7.5% of invoice sales and there are no minimum sales
requirements pursuant to the agreements.  The Company is not
entitled to any royalties under the agreement with Sanofi. The
Company has been notified that Laevosan does not intend to sell
Verapamil in Austria. The Company received no revenues from
licensing fees and royalties under any of the foregoing license
agreements during the fiscal years ending June 30, 2001 and 2000.
The Company does not foresee receiving any material revenue
under any of those licensing agreements in the future.  The
Company does not have the resources to continue to pursue
licensing arrangements.

AZT Formulation
-------------------

                                Page 4 of 16
<PAGE>
     The Company has developed a controlled release rate
formulation of zidovudine (AZT), which is used in the treatment
of persons diagnosed as having Acquired Immunodeficiency
Syndrome (AIDS) or being HIV positive. The trademark name
AZTEC has been registered with the United States Patent and
Trademark Offices and a patent covering this formulation of AZT
was issued in the United States on Oct. 28, 1997. However, the use
of the compound AZT for the treatment of HIV is protected by
patents held by GlaxoSmithKline plc, which do not expire in the
U.S. until 2005. During the fiscal years ended June 30, 1995
through 1998, clinical trials of AZTEC were conducted at 15 sites
in the United States.  However, clinical work and product
registration activities were halted by the Company because of lack
of financial resources. In the mean time the AIDS treatment
market is evolving rapidly, with many new drugs and combination
treatments introduced in recent years.  The Company currently has
no resources to pursue this project, and it is unclear whether the
Company's formulation would be commercially viable even if it
is successfully developed, in view of the new therapies that have
become available.

Future Drug Delivery System
---------------------------

      The Company has conducted early stage development work
with respect to of a sustained drug delivery system that has shown
potential for oral administration of drugs of macromolecule size,
particularly proteins, polypeptides and polysaccharides, which
have low or no bioavailability when given orally.  After the
previous management abandoned a patent application with respect
to this approach, a new provisional patent application was filed
with the assistance of PRP with respect to this approach in
November 2000. PRP and the Company have agreed that PRP will
pay for certain intellectual property and research costs of this
technology, and that the two companies will share equitably in any
proceeds from the development of this technology. However the
Company has been unsuccessful in reproducing earlier work with
this approach. Any further development of this technology would
require that the Company successfully reproduce the results
apparently obtained in earlier experiments.  The Company
currently has no resources to pursue additional experiments in this
area.  There can be no assurance that any patent will be issued and
if it does, whether the claims will be commercially significant.

Veraderm
--------

This is a wound dressing, made from a proprietary formulation of
polymers that, when applied superficially to an open wound, can
enhance healing while diminishing the chances of infection.  Early
testing has shown that it might be beneficial in the treatment of
decubitus ulcers.  However, no controlled clinical field trials have
been carried out. A trademark has been received.

Psorex
------

     The Company has discovered a treatment which it believes may
be useful in alleviating the symptoms of psoriasis. Psoriasis is a
chronic inflammatory skin disease, characterized by skin scaling
and ulcerations, which affects about 2% of the population. The
formulation is a tablet.  The Company currently lacks the
resources to conduct any further development work on this
treatment.

Patents and Trademarks
----------------------

                            Page 5 of 16
<PAGE>
     The Company has developed proprietary technologies which
relate to the development of its drug formulations and business.
These technologies relate primarily to the constant release
characteristics of such formulations.  The Company holds several
patents.

     The Company has obtained several U.S. Trademarks, including
one for its name and others for capsules and formulations which
have been utilized in products and formulations relating to
constant release rate delivery systems.

Competition and Markets
-----------------------

     The Company's drug formulations face severe competition from
many companies which have far greater financial and technical
resources as well as an established reputation.

     Historically, the Company has sought licensing arrangements
for its formulations rather than engage in significant marketing
efforts of its own.  The Company currently has no resources to
pursue licensing arrangements for any of its products under
development.

Employees
---------

     The Company had no full-time employees at June 30, 2001.


ITEM 2.  PROPERTIES
         ----------

     The Company leases office and research facilities at 14
Inverness Drive East, Building D, Suite 100, Englewood,
Colorado, consisting of 6,486 square feet of space at $4,594 per
month pursuant to a lease through March 31, 2002. The Company
sublets a portion of the premises at $2,700 per month to another
unaffiliated company.


ITEM 3.  LEGAL PROCEEDINGS
         -----------------

     On October 23, 2001, PR Pharmaceuticals, Inc., the
majority shareholder of the Company, filed a complaint in the
District Court for Larimer County, Colorado against Mr. James
Petre and Dr. James Dunn, two of the Directors of the Company.
The complaint alleges that Dr. Dunn and Mr. Petre fraudulently
misrepresented material facts in order to induce PR
Pharmaceuticals to purchase the shares of Verex Laboratories, Inc.
from its then majority shareholders.  Mr. Petre and Dr. Dunn were
terminated as employees of PR Pharmaceuticals, Inc. on October
25, 2001.  As of the date of this report, both Mr. Petre and Dr.
Dunn continue as members of the board of directors of Verex
Laboratories, Inc.

     On October 28, 2001, the State of Colorado, Central
Collection Service, as agent for the University of Colorado
Medical School, filed a lawsuit against the Company in the
District Court for the City and County of Denver, Colorado,
seeking payment for clinical drug study services allegedly
provided at the request of the Company.  Services mentioned in
the complaint were performed before the acquisition of any of the
Company's stock by PR Pharmaceuticals, Inc.  The complaint
seeks money damages of $146,761.85, including accrued interest
of $29,543.91.  The Company has filed an answer to the complaint
denying any liability to the State of Colorado.

                             Page 6 of 16
<PAGE>
ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
         ---------------------------------------------------

    There were no matters submitted to the Company's shareholders
for a vote during the Company's fiscal fourth quarter.


                                     PART II


ITEM 5.  MARKET FOR THE REGISTRANT'S COMMON STOCK AND RELATED
         SECURITY HOLDER MATTERS
         ----------------------------------------------------

     The Company's common stock is traded over-the-counter and
its quotations are carried in the Electronic Bulletin Board of the
National Association of Securities Dealers, Inc.

     The following table sets forth the range of high and low bid
quotations for the Company's common stock for the periods
indicated from sources the Company deems reliable, however, no
review of the daily Pink Sheets for the periods indicated has been
undertaken by the Company.

                                                High             Low
-----------------------------------------------------------------------
Fourth Qtr. (Ended June 30, 2001)             $.50               $.38
Third Qtr.  (Ended March 31, 2001)            $.43               $.43
Second Qtr. (Ended December 31,2000)          $.43               $.43
First Qtr.  (Ended September 30,2000)         $.43               $.43
Fourth Qtr. (Ended June 30, 2000)             $.56               $.35
Third Qtr.  (Ended March 31, 2000)            $.56               $.42
Second Qtr. (Ended December 31,1999)          $.66               $.35
First Qtr.  (Ended September 30,1999)         $.44               $.35

The foregoing quotations reflect inter-dealer prices without retail
mark-up, mark-down or commissions and may not necessarily
represent actual transactions.

     As of June 30, 2001, the Company had approximately 1,236
holders of record of its common stock and the closing bid price on
its common stock on Thursday, October 4, 2001 was $.40 per
share.

     The Company has not paid any dividends since its inception
and presently anticipates that all earnings will be retained for
development of the Company's business.


ITEM 6.  SELECTED FINANCIAL DATA
         ------------------------

     Omitted.  See Statement Concerning Rule 12b-21 above.

ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
         CONDITION AND RESULTS OF OPERATIONS
         -------------------------------------------------

Results of Operations
------------------------

Omitted.  See Statement Concerning Rule 12b-21 above.

                         Page 7 OF 16
<PAGE>
Liquidity and Capital Resources
----------------------------------

     At June 30, 2001 the Company had a working capital
deficiency exceeding $1.6 million compared to negative working
capital of $781,385 at June 30, 2000. The principal items
contributing to the deficiency are working capital expenditures
supporting operations for fiscal 2001, and the change in
classification of liabilities for accrued salaries from long-term
liabilities to current liabilities.

     The Company has no capital commitments other than the
payment of deferred salaries to its former employees, aged
accounts payable and the payment of rent on its facilities lease.
The Company currently has no source of funds to meet those
commitments, or to fund ongoing operations.

On March 31, 2000, PR Pharmaceuticals, Inc. (PRP) purchased
approximately 53% of the outstanding stock from the majority
shareholders. As part of the purchase agreement, the employment
agreements, royalty agreements and option agreements between
the Company and its president and other company employees were
either amended or terminated.

     On or about March 22, 2000, the Company arranged a credit
facility with PRP to borrow up to $1,000,000, which matured
March 21, 2001.  All advances under this arrangement are secured
by all of the Company's assets, including its technology, patents,
trademarks and proprietary information and all updates,
modifications, continuations and improvements thereto.  The
Company was able to request advances under this line of credit
from time to time as long as it is in compliance with the
"Conditions of Lending" under the Master Loan Agreement.

     On March 22, 2001 this credit facility became due and
payable.  PRP did not extend this credit facility and the Company
is currently in default.  At June 30, 2001 the Company owed
$615,000 in principal and $56,000 in interest on this line of credit.
In order for the Company to maintain its commitment to provide
payment of the accrued management compensation the Company
has negotiated a series of 90 day notes with PRP.  At June 30,
2001 the Company had borrowed $45,000 under two notes.  In
addition, PRP has advanced $49,192 on account to enable the
Company to pay operating expenses such as rent and utilities. The
agreement under which PRP acquired its shares in Verex provides
that PRP is obligated to make certain advances to Verex to fund
accrued salaries.  That obligation is disputed by PRP.  See Item 3 -
Legal Proceedings.  PRP has made no other commitments to
continue to provide funds and there is no assurance that funds will
be available to support operations or research and development.
There remains $521,513 of accrued management compensation
and aged payables of approximately $267,000. The Company does
not have adequate resources to fund any operations, including
research or development projects.

Recently issued or Proposed Accounting Standards and Pronouncements
-------------------------------------------------------------------

In July 2001, the Financial Accounting Standards Board issued
SFAS No. 141, Business Combinations, and SFAS No 142,
Goodwill and Other intangible Assets and approved for issuance
SFAS No. 143 Accounting for Asset Retirement Allocations.
SFAS No. 141 requires that the purchase method business
combination must meet to be recognized and reported apart from
goodwill. The adoption of SFAS No. 141 will have no impact on
our fiscal 2001 financial statements.

     SFAS No. 142 requires that goodwill no longer be
amortized, but instead tested for impairment at least annual in

                           Page 8 OF 16
<PAGE>
accordance with the provisions of SFAS No. 142. Any goodwill
and any intangible asset determined to have an indefinite useful
life that are acquired in a purchase business combination
completed after June 30, 2001 will not be amortized, but will be
evaluated for impairment in accordance with the appropriate
existing accounting literature. The adoption will have no impact
on our fiscal 2001 financial statements.

     SFAS No. 143 requires entities to record the fair value of a
liability for an asset retirement obligation in the period in which it
is incurred and a corresponding increase in the carrying amount of
the related long-lived asset and is effective for fiscal years
beginning after June 15, 2002. Management is currently assessing
the impact SFAS No. 143 will have on our financial condition and
results of operations.

Subsequent Events
------------------

Subsequent to June 30, 2001 the Company received a notice of
claim from the State of Colorado Health Science Center relating to
an alleged debt of approximately $117,219 plus $5,780 of interest
through August 23, 2001 allegedly owed by the Company from
1995.  The Company maintained no record of this alleged liability
and the alleged liability was not recorded as of June 30, 2001.
Further, the Company is subject to many claims in the normal
course of its business operations.  The outcome of the claim and
those in the normal course of its business cannot be accurately
predicted.

Subsequent to June 30, 2001, Edward C. Gruben, Treasurer,
tendered his resignation and was accepted by the Company's
Chairman.

Industry Trends
- ----------------

     There is substantial competition with respect to delayed release
drug delivery products from major, highly recognized,
manufacturers with large advertising budgets.  In addition, major
drug manufacturers currently market recognized prescription
formulations for Verapamil, Naproxen, Indomethicin and AZT.

Future Business Strategy and Subsequent Events
- ----------------------------------------------
The Company currently does not have the financial resources to
meet existing commitments or to fund ongoing business
operations.

Forward-Looking Statements
-----------------------------

     Included under this Item 7 are "forward-looking statements"
within the meaning of Section 27 of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934.  Although the
Company believes that the expectations reflected in such
forward-looking statements are reasonable, it an give no assurance
that such expectations will prove to be correct since he Company
is not able to accurately predict if it will obtain adequate funding
to continue in business or license or market its products.
Important factors affecting its ability to do so include the extreme
competitiveness of the industry, the cost involved to market new
drug products, the very limited resources of the Company and the
regulatory environment in which the Company operates.

ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
         -------------------------------------------

                            Page 9 OF 16
<PAGE>
     Omitted.  See Statement Concerning Rule 12b-21 above.


ITEM 9.  DISAGREEMENTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
         ----------------------------------------------------

      On October 9, 2001, Registrant replaced Balukoff Lindstrom &
Co., P.A. ("BL&Co.") as Registrant's principal accountant and
engaged the services of KPMG LLP.  BL&Co. was Registrant's
auditor for the year ended June 30, 2000.

     The decision to replace BL&Co. was approved by unanimous
consent of the Board of Directors of the Registrant on September
18, 2001.

     There have been no disagreements between BL&Co. and the
Registrant on any matter of accounting principles or practices,
financial statement disclosure, or auditing scope or procedure.
The term "disagreement" is utilized in accordance with Item 304
of Regulation S-K.

     Registrant provided BL&Co. with a copy of this Current Report
on Form 8-K prior to its filing with the SEC and requested that
BL&Co. furnish it with a letter, addressed to the Securities and
Exchange Commission, indicating that it agrees with the
statements contained in the Current Report on Form 8-K and, if it
does not agree, indicating the statements with which it does not
agree.  BL&Co. provided such letter dated October 9, 2001, stating
that they agreed with the statements made in the disclosure set out
in Item 4 of Form 8-K.


                               PART III


ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS
          --------------------------------

     The By-laws of the Company provide that the affairs of the
Company shall be managed by its Board of Directors consisting of
at least three persons.  The controlling shareholders of the
Company elected a new slate of Directors and Executive Officers
as indicated below.  On April 1, 2000, Carolyn Dunn and Mark
Banister resigned from the Board of Directors. These vacancies
were filled by Dr. Patrick Bols and Steve Howe. During the
reporting period the following Directors and Executive Officers
were in office.

Name                         Age             Occupation
James M. Dunn M.D.           64          President of the Company (1980 -
                                         March 2000); Director of the
                                         Company (1980 - Present);
                                         Treasurer of the Company (1980 -
                                         March 2000); Chairman of the
                                         Board of Directors and Chief
                                         Executive Officer of the Company
                                         (1982 - March of 2000); Assistant
                                         Professor, School of Medicine,
                                         Louisiana State University (1979 -
                                         1980); Vice President-Medical
                                         Affairs, Boots Pharmaceutical,
                                         Inc. (1979-1980); Director of
                                         Clinical Pharmacology and
                                         Research, Wallace Laboratories
                                         (1976-1979)



James B. Petre                48         Director of the Company

                         Page 10 OF 16
<PAGE>
                                         (January 1993 - Present);
                                         Independent business consultant
                                         and advisor (1989 - Present);
                                         Senior Vice President and
                                         Director of Previews, Inc.
                                         Denver, Colorado; a worldwide
                                         real estate brokerage firm
                                         (1984-1989); Member of the Drug
                                         Information Association. BS in
                                         Business Administration,
                                         University of Denver.


Steve Howe <FN1>              49         Chairman of the Board of
                                         Directors (March 2000 -
                                         Present); Chief Executive
                                         Officer (March 2000 - Present);
                                         Secretary (March 2000-
                                         Present); Chairman of the Board
                                         of Directors and Chief
                                         Executive Officer, PR
                                         Pharmaceuticals Inc.; BA in
                                         Business Administration - University
                                         of Wyoming.


Patrick Bols, Ph.D.          51          Director (March 2000 -
<FN1>                                    Present); President (March 2000
                                         - Present); President and Director PR
                                         Pharmaceuticals Inc.; Director of
                                         Worldwide Business Development -
                                         Johnson & Johnson; Ph.D in
                                         Agricultural Sciences -
                                         University of Gent, Belgium.


Edward C. Gruben             55          Treasurer (March 2000 -
                                         Present); Managing Partner -
                                         Cambridge Consulting Group LLP;
                                         Managing Partner - Cambridge
                                         Management Associates LLP;
                                         Member of the American
                                         Institute of Certified Public
                                         Accountants and the Colorado
                                         Society of CPA's; BSBA in
                                         Physical Sciences and
                                         Accounting - University of
                                         Colorado. Subsequent to June 30, 2001,
                                         Mr. Gruben resigned as an officer
                                         and employee of the company.


<FN1> Messrs. Howe and Bols are major shareholders in PR
Pharmaceuticals Inc.,  which owns 52.95% of the Company's
issued and outstanding common stock.

     The Board of Directors does not have Audit, Compensation or
Nominating Committees.  During the period from July 1, 2000 to
June 30, 2001, the Board of Directors met two times, and all
directors attended the meetings, either in person or by telephone.

                               Page 11 OF 16
<PAGE>
ITEM 11.  EXECUTIVE COMPENSATION
          ----------------------

The following tabular information includes all plan and non-plan
compensation paid to the Company's President and to all other
executive officers whose total annual salary and bonus is $100,000
or more.

                                Summary Compensation
                Annual Compensation                 Long-Term
Compensation
         ----------------------------------  ---------------------------------
                                                 Awards            Payouts
                                            ----------------   --------------
                                     Other                              All
                                     Annual    Restricted               Other
Name and                             Compen-   Stock            LTIP   Compen-
Principal          Salary     Bonus  sation   Award(s) Options/ Payouts sation
Position      Year   ($)       ($)     ($)        ($)    SARs(#)  ($)    ($)
---------     ----  ------    -----   -------   -------- ----- ------- -------
James M.      2001     -0-     -0-      -0-       -0-     -0-     -0-    -0-
Dunn, M.D.    2000  125,000    -0-      -0-       -0-     -0-     -0-    -0-
 (Former      1999  125,000    -0-    9,063       -0-     -0-     -0-    -0-
President and
Chairman of
the Board)

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

  (1)  Dr. Dunn was actually paid -0-, $31,250, and $0 as salary for
the years ended June 30, 2001, 2000 and 1999, respectively.  The
annual salaries set forth above are pursuant to Dr. Dunn's
employment contract discussed below.

  (2)  Dr. Dunn actually received $0 in fiscal 2001 and 2000, in
other forms of compensation comprised of premiums paid on life
insurance and automobile lease and maintenance expense. He
earned $ -0-, $5,506 and $5,506 in vacation allowance for fiscal
2001, 2000 and 1999, respectively and $0, $0 and $0 respectively
in product minimum royalties for each fiscal year: 2001, 2000 and
1999, all of which was deferred along with accumulated amounts
through January 1, 2000.

  (3)  Excludes amounts accrued and forgiven by Dr. Dunn on
March 31, 1997.

Employment Contract - James M. Dunn, M.D.
-------------------------------------------
     On November 30, 1993, the Company entered into an
employment agreement with its now former President, James M.
Dunn, M.D. whereby Dr. Dunn agreed to serve as President of the
Company until he reaches the age of 65 (2003) and agreed to
assign to the Company all his right, title and interest in his
inventions, discoveries, innovations, concepts and know-how
during the period of the Agreement.  Dr. Dunn was entitled to
receive an annual salary of $338,000, subject to annual
adjustments, a $3,000,000 life insurance policy, disability
insurance equal to 80% of his gross income, and health insurance.
In addition, he is entitled to a 2% royalty on the first $5,000,000 in
net sale price of any Verex patented product, a 1% royalty on net
sales in excess of $5,000,000 and a 2% royalty on Verex licensed
technology.  At March, 1997, a total of $2,605,204 was accrued in
compensation pursuant to the agreement, and Dr. Dunn waived his
claims thereunder in exchange for 25% in future revenues from
AZTEC and 5% in future revenues from certain other Company
drug formulations up to $2,605,204 and certain assignment rights
to AZTEC in the event the Company has not licensed AZTEC

                        Page 12 OF 16
<PAGE>
prior to December 31, 1998. On March 31, 2000, Dr. Dunn
resigned from the Company as an employee, its President and
Chairman.

Employment and Royalty Agreements
---------------------------------

On March 31, 2000 the Company and its prior President
terminated all prior employment agreements and amended the
royalty agreement.  The prior President had a balance of accrued
salaries of $395,833 owed for past services.  The Company agreed
to pay $9,146 for 24 months with a balloon payment of $176,321
plus any accrued interest on February 1, 2002.  If during the
twenty-four months the Company is able to commercialize any of
its products, 30.49% of the net profit will be used to accelerate the
payment of the accrued salary. The acceleration payments will be
made to the balloon balance first, and then applied to the
remaining monthly installments.

The prior President continues to act as a Director of the Company.
On March 31, 2000 the prior President and PRP agreed to an
employment agreement for five years. The prior President is paid
$125,000 for the first year and increases in subsequent years based
on contributions to PRP.

On March 31, 2000 the Company and one of its
Employee/Directors agreed to an employment contract. The
employee was to be  paid a base salary of $80,000 per year. This
employee had a balance of accrued salaries of $253,333.  The
Company agreed to pay $5,854 for 24 months with a balloon
payment of $112,845 plus any accrued interest on February 1,
2002. If during the twenty-four months the Company is able to
commercialize any of its products, 19.51% of the net profit will be
used to accelerate the payment of the accrued salary. The
acceleration payments will be made to the balloon balance first,
and then applied to the remaining monthly installments. In April of
2001, this employee resigned his position with the Company and
agreed to an employment agreement with PRP on similar terms as
he had with the Company.

The Company amended the royalty agreement to pay its prior
President 7.5% of license royalty or on gross profit received by the
Company on sales or licensing from the Aztec product only.  The
amount to be paid to the prior President is not to exceed an
accumulative total of approximately $2.5 million.


ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
          AND MANAGEMENT
          -----------------------------------------------

     Based on certain reports filed with the Securities and Exchange
Commission, the table on the following page reflects certain
information as of September 30, 2001 as to beneficial holders of
more than 5% of the outstanding shares of Common Stock of the
Company and as to Common Stock beneficially owned by all
executive officers and directors of the Company as a group:

                         Amount and Nature      Percent of Shares
     Name of               of Beneficial         of Common Stock
Beneficial Owner           Ownership <FN1>         Outstanding
------------------         -----------------      -----------------

PR Pharmaceuticals, Inc.     1,345,517               52.95%

Steve R. Howe <FN2>

Patrick Bols <FN2>

                            Page 13 OF 16
<PAGE>

James M. Dunn, M.D.             -0-                      0%

James B. Petre                  -0-                      0%

Officers and Directors
as a Group (2 persons)       1,345,517               52.95%
------------------------

<FN1>  This table is based on 2,540,987 shares outstanding and
contingently issuable, and does not include presently exercisable
options to purchase shares of the Company's Common Stock held
by each of the foregoing. See "Certain Relationships and Related
Transactions" below for details.  Beneficial ownership by any
person includes direct or indirect voting power and investment
power with respect to such shares of common stock of the
Company.

<FN2>  Includes shares held by PR Pharmaceuticals, Inc.


ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
          ----------------------------------------------

     The Company leases facilities through March 31, 2002 at a
current monthly rate of $4,594 plus a pro rata share of
maintenance costs.  A portion of the space is subleased to Jerry R.
Dunn, a former officer of the Company at $2,700 per month.
Management believes the terms of the facilities sharing with Jerry
R. Dunn are as fair to the Company as could be arranged with an
independent party.

Business Service Agreement
--------------------------

On April 12, 2000 the Company signed a business services
agreement with PRP. PRP is to provide administrative functions
necessary in the management of the Company.  Fees to be paid to
PRP are not to exceed $5,000 per month, without the prior written
consent of the Board of Directors of Verex.  The business service
agreement can be cancelled by either party with 60 days prior
written notice.  As of June 30, 2001 the Company owed $30,000 in
fees under this agreement which is accruing finance charges for
late payment at 10% per annum.  The Company has accrued $660
in finance charges to June 30, 2001.

Agreement Regarding Patent Prosecution, Research and Development

On November 16, 2000, the Company signed an agreement
concerning the development of the Company's sustained release
approach for oral delivery of macromolecules with PRP.  This
agreement provides that PRP will make certain payments for the
research, development and intellectual property expenses incurred
in connection with this approach. Pursuant to this agreement, a
provisional patent application was filed, and additional studies
have been conducted. To date, the Company had not been able to
replicate earlier favorable data.  Any further development of this
technology would require that the Company successfully
reproduce the results apparently obtained in earlier experiments.
The Company currently has no resources to pursue additional
experiments in this area.  There can be no assurance that any
patent will be issued and if it does, whether the claims will be
commercially significant.


                           PART IV

ITEM 14.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON
          FORM 8-K
          -------------------------------------------------------

                             Page 14 OF 16
<PAGE>
(1)    Omitted. (a)(1) Omitted.  See Statement Concerning Rule
       126-21 above.

      (2)   Omitted.  See Statement Concerning Rule 12b-21 above.

      (3)   The following Exhibits were included as Exhibits to the
            Form S-18, SEC File No. 2-82403-D filed March 11, 1983
            and are incorporated herein by reference:

              3.1 - Restated Articles of Incorporation
              3.2 - Restated By-laws
            10.34 - Credit Facility Agreement - PR Pharmaceuticals
            10.35 - Agreement James M. Dunn, M.D. and registrant
                    regarding accrued salary at registrant
            10.36 - Agreement James B. Petre regarding employment at
                    Registrant and payment of accrued salary at
                    Registrant.
            10.37 - Royalty Agreement James M. Dunn, M.D. amended
                    March 2000
            10.38 - Business Service Agreement - PR Pharmaceuticals
            10.39 - Agreement regarding Patent Prosecution, Research and
                    Development dated November 16, 2001 [not attached pending
                    confidentiality request]


(b)   No Form 8-K's were filed by the Company during the quarter
ended June 30, 2001.






















                               Page 15 OF 16
<PAGE>
                                SIGNATURES

     Pursuant to the requirements of Section 13 of the Securities
Exchange Act of 1934, the Company has duly caused this report to
be signed on its behalf by the undersigned, thereunto duly
authorized.


(Registrant)                       VEREX LABORATORIES, INC.
(Date)                             January 24, 2002
By:(Signature)                     /s/ Patrick Bols
(Name and Title)                   Patrick Bols, President and Director


     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.


(Registrant)                       VEREX LABORATORIES, INC.
(Date)                             January 24, 2002
By:(Signature)                     /s/ Patrick Bols
(Name and Title)                   Patrick Bols, President and Director




(Date)                             January 24, 2002
 By:(Signature)                    /s/Steve R. Howe
(Name and Title)                   Steve R. Howe, Chairman of the
                                   Board, Secretary and Director






























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