CANNABIS SCIENCE, INC.



FORM 10-Q/A
(Quarterly report)


Filed 08/24/09 for the Period Ending 30/06/09





     Address		6946 N Academy Blvd
			Suite B No. 254
			Colorado Springs, CO 80918
     Telephone		1-888-889-0888
     CIK		0001024626
     Symbol		CBIS
     SIC Code		1311 - Crude Petroleum and Natural Gas
     Industry		Biotechnology & Drugs
     Sector		Healthcare
     Fiscal Year	12/31













SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q/A


(Mark One)

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

For the quarterly period ended June 30, 2009

OR

[    ]TRANSITION REPORT UNDER SECTION 13 OF 15(d) OF THE EXCHANGE
ACT OF 1934

From the transition period from ________ to ________.

Commission File Number 000-28911

CANNABIS SCIENCE, INC.
(Exact name of small business issuer as specified in its charter)

Nevada

91-1869677
(State or other jurisdiction of incorporation or
organization)

(IRS Employer Identification No.)

6946 N Academy Blvd, Suite B #254
Colorado Springs CO 80918

(Address of principal executive offices)

(888) 889-0888
 (Issuer's telephone number)

GULF ONSHORE, INC.
(Former name, former address and former fiscal year, if changed
since last report)

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

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 [   ].

Smaller Reporting Company [X]


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

As of August 20, 2009, there were 22,142,279 shares of Common Stock
of the issuer outstanding.












TABLE OF CONTENTS




                PART I FINANCIAL STATEMENTS




Item 1 Financial Statements 			   3

Item 2 Management's Discussion and
Analysis or Plan of Operation			  17


                PART II OTHER INFORMATION

Item 1 Legal Proceedings			  20
Item 2 Changes in Securities			  20
Item 3 Default upon Senior Securities		  20
Item 4 Submission of Matters to a Vote
of Security Holders				  20
Item 5 Other Information			  20
Item 6 Exhibits and Reports on Form 8-K		  20




2

CANNABIS SCIENCE, INC.
(A Development Stage Company)
Consolidated Balance Sheets



				     		   December 31,
				   June 30 2009	     2008
				    (Unaudited)	   (Audited)

Assets
Current Assets:
  Cash			     	$        151          580
   Accounts Receivables        		  -            -
   Other Receivables            	  -            -
				    ------------------------
Total Current Assets		         151          580
				    ------------------------

Fixed assets:
  Equipment			       3,000        2,000
  Less: Accumulated Depreciation        (633)        (433)
				    ------------------------
 Total Fixed Assets		       2,367        1,567
				    ------------------------
Other Assets:
  Intellectual Property
  (See Notes 10 and 11)		     524,000	   -
				    ------------------------
Total Assets		        $    526,518        2,147
				    ------------------------

Liabilities and Shareholders' Equity/(Deficit)
Current Liabilities:
  Accounts Payable	        $    401,674      359,179
  Accrued Expenses	             161,914	   45,415
  Accrued Interest Payable
  to Affiliate 		             175,664      136,346
  Loan Payable to Affiliate          814,742      814,742
  Line-of-Credit to Affiliate4	       5,438       (3,031)
				   ------------------------
Total Current Liabilites 	   1,599,432    1,352,651
				   ------------------------

Commitments and Contingencies
(See Note 8)		                -            -

Shareholders' Equity/(Deficit):
Common Stock, $.001 par value,
30,000,000 shares  authorized  	      22,142       12,597
 Shares Issued and Outstanding
    June 30, 2009 - 22,142,279
    Dec 31, 2008 - 12,597,279
Additional Paid in Capital        50,229,788   48,148,783
Accumulated Deficit              (51,324,844) (49,511,884)
				   -----------------------
 Total Shareholders'
  Equity/(Deficit) 	          (1,072,914)  (1,350,504)
				   -----------------------
Total Liabilities and
Shareholder' Equity/(Deficit) 	     526,518        2,147
 				   -----------------------

See accompanying summary of accounting policies and
notes to consolidated financial statements.




3



CANNABIS SCIENCE, INC.
(A Development Stage Company)
Unaudited Consolidated Statements of Operations
For the Six and Three Months Ended June 30, 2009 and 2008 and
For The Period From Inception to June 30, 2009


							  	  Period from							  	  Period from
		      6 Mths	  6 Mths     3 Mths	3 Mths	  Jan 27, 2005
                      ended       ended      ended      ended     (inception) to
		      June 30,    June 30,   june 30,   June 30,   June 30,
		      2009        2008       2009       2008       2009

OIL & GAS OPERATIONS:
Oil & Gas Renenues	 -         161,559       -         67,382       459,652
Lease Operating
Expenses		 -          94,177       -         32,805       230,164
		      --------------------------------------------------------
Gross Profit		 -          67,382       -         34,577       229,488
OTHER EXPENSES:
New Product
Development	      458,400          -      458,400         -         458,400
Professional Fees     993,464       90,360    969,341      38,244    32,184,426
Technology License
Royalties  		 -             -         -            -         160,417
Impairment of Oil        -       2,400,000       -      2,400,000     7,486,000
& Gas Leases
Net Gain on Settlement
of Liabilities 	         -      (6,285,651)      -            -      (5,935,451)
General and
Administrative        321,778       91,168    321,115      23,321    16,110,133
		      --------------------------------------------------------
Total Operating
Expenses 	    1,773,642   (3,704,123) 1,748,856   2,461,565    50,463,925
		      --------------------------------------------------------

OPERATING INCOME
(LOSS) 	           (1,773,642)   3,771,505 (1,748,856) (2,426,988)  (50,234,437)

Other Income (Expense):
 Other Income            -             -        -             -           1,439
 Beneficial Conversion
 Feature                 -         (32,335)     -          32,335    (1,098,992)
 Gain on Settlement
 of Debt                 -             -        -             -         117,950
 Interest Expense     (39,318)       (4123)   (19,659)       4123      (110,804)
		      --------------------------------------------------------
Total Other
Income (Expense)      (39,318)     (36,458)   (19,659)    (36,458)   (1,090,407)
		      --------------------------------------------------------
NET INCOME (LOSS)$ (1,812,960)   3,735,047 (1,768,515)  2,390,530   (51,324,844)
                      --------------------------------------------------------

Basic Earnings
per Share        $      (0.11)        1.38     (0.00)      (0.25)

Basic and Diluted
Earnings per Share $    (0.11)        1.37     (0.00)      (0.24)

Weighted Average Shares
Outstanding: Basic  21,122,347   2,712,151 14,687,261   2,019,706

Weighted Average Shares
Outstanding: Diluted      -      2,730,151       -      2,037,706

See accompanying summary of accounting policies and notes to
consolidated financial statements.


4


CANNABIS SCIENCE, INC.
(A Development Stage Company)
Consolidated Statements of Shareholders' Equity
For the Period from Inception to June 30, 2009


							     Deficit
				   Additional		     Accum.
 		  Common  Stock      Paid-in     Prepaid     During The
                                                             Development
                Shares      Par      Capital   Consulting     Stage       Totals

Bal at Jan 27,
2005
(inception)  $    -         -          -            -             -          -

Founder's Stock
Issued         83,800       84         (84)         -             -          -
Shares Issued
for Debt        8,000        8     399,992          -             -     400,000
Shares issued
for License
Agreement      86,188       86         (86)         -             -          -
Effect of
Reverse
Merger         13,840       14    (200,014)         -             -    (200,000)
Divestiture of
Subsidiary to
Related Party     -         -      544,340                              544,340
Net loss                                                  (807,600)    (807,600)
		-----------------------------------------------------------------
Bal at Dec
31, 2005      191,828      192     744,148          -     (807,600)     (63,260)
Shares Issued
for
Employment     45,500       45   8,487,455          -          -      8,487,500
Shares Issued
for
Services      171,080      171  28,798,329 (7,633,750)         -     21,164,750
Shares Issued
for Lease
Agreement       6,770        7     406,193         -      (350,200)      56,000
Net loss				               (36,906,584) (36,906,584)
		-----------------------------------------------------------------
Bal at Dec
31, 2006      415,178      415  38,436,125 (7,633,750) (38,064,384)  (7,261,594)
Shares Issued
For Services   63,021       63     528,285   (387,500)        -         140,848
Shares Issued
for Debt
Conversion    350,000      350     349,650        -           -         350,000
Amortization
of Beneficial
Conversion
Feature           -         -    1,066,657                            1,066,657
Amortization
of shares
issued for
services                                    8,021,250                 8,021,250
Shares Issued
for
Properties    500,000      500   4,999,500                            5,000,000
Net loss    				              (15,007,117) (15,007,117)
		-----------------------------------------------------------------
Bal at Dec
31, 2007    1,328,198    1,328  45,380,217            (53,071,501)  (7,689,956)
Amortization
of Beneficial
Conversion
Feature                             32,335                               32,335
Cancellation
and
Amortization
of Shares        (919)      (1)          1
Issuance of
Shares for
Cash           10,000       10      19,990                               20,000
Shares Issued
for Debt
Conversion    990,000      990      98,010                               99,000
Purchase of
Subsidiary
with Stock 10,000,000   10,000    2,490,00                            2,500,000
Issuance of
Stock for
Services      270,000      270     128,230                              128,500
Net Income 						 3,559,617    3,559,617
 		-----------------------------------------------------------------
Bal at Dec
31, 2008   12,597,279   12,597  48,148,783         -   (49,511,884)  (1,350,504)
Issuance of
Shares for
Assets      2,100,000    2,100     522,900         -                    525,000
Cancellation
of Stock
Previously
Issued       (10,000)      (10)         10
Issuance of
Shares for
Services   7,455,000     7,455   1,558,095                            1,565,550
Net Loss						(1,812,960)  (1,812,960)
		-----------------------------------------------------------------
Bal at
June 30,
2009      22,142,279    22,142  50,234,788             (51,324,844)  (1,072,914)
		-----------------------------------------------------------------



See accompanying summary of accounting policies and notes to
consolidated financial statements.



5



 CANNABIS SCIENCE, INC.
(A Development Stage Company)
Consolidated Statements of Cash Flows
For The Period From Inception to June 30, 2009
(Unaudited)


								   Period from
                                     six months    six months      Jan 27, 2005
 				        Ended         Ended        (inception)
 				      June 30,      June 30,        to June 30,
				       2009          2008              2009


CASH FLOWS FROM OPERATING ACTIVITIES

Net Income (Loss)               $   (1,812,960)    3,735,047      (51,324,844)
Adjustments to reconcile net
income (loss) to cash used in
operating activities:
Depreciation and depletion                 200         1,169            6,382
Amortization on investment
in Custer leasehold	                                                9,333
Impairment on oil
lease investments                                  2,400,000        7,476,667
Write off oil and gas properties				      100,000
Stock  issued for services 	     1,565,550                     31,008,357
Amortization of prepaid
consulting fees							    8,021,250
Amortization of beneficial
conversion feature 				      32,335        1,098,992
Shares to be issued
Loss on disposition of subsidiary				       97,050
Changes in certain assets and liabilities:
(Increase) decrease in
accounts receivable
Increase  in accrued interest
to affiliate                           39,318 			      987,375
Increase in accounts payable           42,495         17,158          401,674
Decrease in accounts payable
related party 	                                       3,856           (3,031)
Increase in Line of Credit
- Related Parties 		       48,469			       48,469
Increase (decrease) in
accrued expenses 	              116,499     (1,280,585)         161,914
Increase in Others							1,950
 				     ----------------------------------------
CASH FLOWS USED IN OPERATING
ACTIVITIES: 			         (429)      (290,178)      (1,998,461)
				     ----------------------------------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of oil & gas leases			     (30,000)         (30,000)
Purchase of property, plant & equipment 	      (2,000)         (42,890)
				     ----------------------------------------
CASH FLOWS USED IN INVESTING ACTIVITIES   -          (32,000)         (72,890)
				     ----------------------------------------

CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from convertible note
- related party, net 				     551,342          951,342
Sale of Stock for Cash						       20,000
Loans payable to affiliates 			      66,657        1,008,997
 			             ----------------------------------------
CASH FLOWS PROVIDED BY
FINANCING ACTIVITIES 			             617,999        1,980,339
 			             ----------------------------------------

NET INCREASE IN CASH &CASH EQUIVALENTS   (429)        (4,315)             580
CASH &CASH EQUIVALENTS,
BEGINNING OF PERIOD 		          580          4,769              -
  				      ---------------------------------------
CASH &CASH EQUIVALENTS, END OF PERIOD 	  151            454              580

SUPPLEMENTAL CASH FLOW INFORMATION:
Issuance of commons stock
for services 		            1,565,250                       1,815,250
Related party note payable					      250,000
Net liabilities assumed
with recapitalization						      200,000
Divestiture of subsidiary
to related party						      544,340
Common stock issued for debt			      50,000        1,149,000
Common stock issued for
acquiring oil & gas leases					    7,906,200
Common stock issued for
Intellectual Property 	             525,000			      525,000
Common stock issued for services				    7,906,200


See accompanying summary of accounting policies and notes to
consolidated financial statements.



6








CANNABIS SCIENCE, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2009


NOTE 1 - NATURE OF ACTIVITIES AND SIGNIFICANT ACCOUNTING POLICIES

Organization and Description of Business:

Cannabis Science, Inc.  ("We" or "the Company"), was incorporated
under the laws of the State of Colorado, on February 29, 1996, as
Patriot Holdings, Inc..  On August 26, 1999, the Company changed
its name to National Healthcare Technology, Inc., and commenced
a business plan to develop Magkelate, a patented intravenous drug
developed to re-establish normal electrolyte balance in ischemic
tissue and certain other patents for medical instruments and medical
instrument technology.  On January 14, 2000, the Company filed
its Form 10SB12G.  In 2002, the Company ceased its medical
technology business following the death of Magkelate's inventor.
The Company conducted no substantial business until 2005.

 In July 2005, the Company acquired Es3, Inc., a Nevada Corporation
("Es3"), pursuant to the terms of an Exchange Agreement (the
"Exchange Agreement") by and among the Company, Crown Partners,
Inc., a Nevada corporation ("Crown Partners"), Es3, and
certain stockholders of Es3 (the "Es3 Stockholders"). Under the
terms of the Exchange Agreement, the Company acquired all of the
outstanding capital stock of Es3 in exchange for the issuance of
191,828 shares of the Company's common stock (adjusted for splits)
to the Es3 Stockholders, Crown Partners and certain consultants.
The transactions effected by the Exchange Agreement were
accounted for as a reverse merger, and recapitalization. In addition,
the Company changed its accounting year-end from September 30
to December 31, which was Es3's accounting year-end.  The Company
then commenced business manufacturing and marketing
products under the name Special Stone Surfaces.  The Company sold
its shares in Es3 in October 2005, and thereafter conducted no
substantial business until 2006,

On April 3, 2006, the Company acquired a group of oil and gas
leases in Oklahoma in exchange for issuance of common stock and
commenced the business of oil and gas exploration and production,
mineral lease purchasing and all activities associated with
acquiring, operating and maintaining the assets of such operations.
On June 6, 2007, the Company changed its name from National
Healthcare Technology, Inc., to Brighton Oil & Gas, Inc., and
converted to a Nevada corporation.  The Company acquired additional
oil and gas leases during 2007, all for issuance of common stock;
in October 2007, the Company acquired leases from K & D Equity
Investments, Inc., a Texas corporation in a transaction that effected
a change of control, with K & D acquiring a majority stake in the
Company.   The Company also entered into a Line of Credit Agreement
with South Beach Live, Inc., a Florida corporation, to provide
it with working capital of up to $100,000 on a revolving credit
line. The Agreement permitted South Beach the right to repayment on
demand, or to convert amounts owed for shares.

On March 25, 2008 the Company changed its name to Gulf Onshore, Inc.
On June 6, 2008, the Company entered into an Asset
Acquisition Agreement with K & D to acquire additional leases (the
"Leases") in exchange for common stock and a Stock Purchase
Agreement ("SPA") with South Beach Live, Inc., a Florida corporation,
to purchase 100% of the common shares of Curado Energy
Resources, Inc., a Texas corporation ("Curado"). Curado is registered
with the Texas Railroad Commission as an oil and gas well
operator, and is the operator for the Leases.   The Company acquired
 the Leases into Curado, in exchange for shares issued to K &
D.  The Company issued  South Beach a promissory note for $250,000,
payable in 1 year at 10% interest, which was guaranteed by
Curado.   The Company consolidated the operations of Curado commencing
in 3Q 2008.

Throughout 3Q 2008, declining oil prices and increased operating
costs made continued oil and gas operations on the Leases
unprofitable, and the Company was continually drawing down on its
 Line of Credit Agreement with South Beach. In exchange for
concessions from South Beach regarding further cash advances and
future stock conversions, in August 2008, the Company granted
South Beach a security interest in its Curado shares and the Curado
assets.



7








On October 6, 2008, in the face of further oil price declines and
general economic conditions, the Company and South Beach entered
into an Accord and Satisfaction Agreement under which the Company
surrendered its interest in the Putnam "M" oil and gas lease in
Throckmorton Co., Texas in exchange for a complete release on the
Promissory Note and Line of Credit.  In addition, the Company
waived any claim on the shares of Curado common stock that secured
the Promissory Note or the assets of Curado.  South Beach then
made claim against Curado under the guarantee agreement and then
exercised its rights under the collateral agreement.  As a result,
the Company's the fourth quarter 2008, financial statements reflected
the disposition of Curado and its assets, and furthermore that the
Company has, once again, become a Development Stage Company seeking
a new business partner or acquisition.  A Form 8-K
reflecting this transaction was timely filed.

On March 30, 2009, the Company entered into an agreement with Cannex
Therapeutics, LLC, ("Cannex") a California limited liability
company, and its principal, medical cannabis pioneer and entrepreneur
Steven W. Kubby, to acquire all of their interest in certain
assets used to conduct a cannabis research and development business.
 The asset purchase agreement includes all of Cannex' and
Kubby's intellectual property rights, formulas, patents, trademarks,
client base, hardware and software, including the website
www.phytiva.com.  The Company and its largest shareholder, K & D
Equities, Inc., exchanged a total of 10,600,000 shares of
common stock for the assets of Cannex; the Company issued 2,100,000
shares to Cannex, and K & D transferred 8,500,000 shares to
Cannex and others.   A Form 8-K reflecting this transaction was
timely filed.  Please see Note 10.

As part of the Agreement, on April 1, 2009, the Company appointed
Mr. Kubby as President and CEO, Richard Cowan as Director
and CFO, and Robert Melamede Ph. D., as Director and Chief Science
Officer. Each of them was also appointed as a director.  All of
the Company's current directors then resigned.

On April 7, 2009, the Company changed its name to Cannabis Science,
Inc., reflecting its new business mission: Cannabis Science,
Inc. is at the forefront of medical marijuana research and
development. The Company works with world authorities on
phytocannabinoid science targeting critical illnesses, and adheres
to scientific methodologies to develop, produce, and commercialize
phytocannabinoid-based pharmaceutical products. In sum, we are
dedicated to the creation of cannabis-based medicines, both with
and without psychoactive properties, to treat disease and the
symptoms of disease, as well as for general health maintenance. The
Company obtained a new CUSIP number as well.  Cannabis Science
Inc. has also launched its new website www.cannabisscience.com
reflecting its new name.

On April 27, 2009 Cannabis Science Inc. Reports on Prospective Life
Saving Treatments for H1N1 Swine Flu and H5N1 Bird Flu in
View of the Current Global Threat. The Company's non-toxic
lozenge has properties that could alleviate many of the symptoms and
harmful effects of the H5N1 bird flu and H1N1 swine flu viruses.

On May 7, 2009 the Company common shares commenced trading under
the new stock symbol OTCBB: CBIS.

On June 9, 2009 the Company announces it has received U.S.
Federal Government CAGE/NCAGE Code Certification;
CAGE/NCAGE Code: 5FZM9 was obtained through Central Contracting
 Registration (CCR). The CCR is the primary vendor
database for the U.S. Federal Government and is used as a
government tool for the Department of Homeland Security, Department
of Defense, NATO and NASA Agencies. Specifically the Company
received U.S. Federal Government Classification for North
American Industry Classification System (NAICS) 541711 - Research
and Development in Biotechnology, 621511 - Medical
Laboratories, 624230 - Emergency and Other Relief Services.
The Company has also received U.S. Government Classification for
Standard Industrial Classification (SIC) for 8731 - Commercial
Physical and Biological Research, enabling it to receive government
notifications and requests for services under these classifications.

With the Special Board Resolution held on July 9, 2009 it was
resolved with the majority of the board of directors calling to
immediately remove and terminate all corporate officer contracts
with its President and CEO, Mr. Steven W. Kubby, who had failed to
conduct his duty in the manner that is in compliance with his
fiduciary duties to preserve shareholders value and corporate integrity.
It as resolved that Dr. Robert Melamede remains as a Director and has
 been appointed to the position of President & CEO and
Secretary effective immediately and continue the term until the
next annual general meeting. With the Special Board Meeting held on
July 10, 2009, the Board has received and has accepted the
resignation of Steven W. Kubby as a member of the Board of Directors.

July 20, 2009 the Company announced it is moving forward with its
preparations for a pre-IND meeting with the FDA, which will
provide guidance on the manufacturing, non-clinical, and clinical
development program for Cannabis Science Drugs. As well the
Company reports intentions to move corporate headquarters to
Colorado Springs, Colorado. The Company has since moved its
Corporate Headquarters to Colorado Springs, CO.

The Company on July 27, 2009 announced intentions to apply to the
FDA to utilize their Fast Track Procedures to help speed the
approval of its Cannabinoid medicines in treatment of H1N1 Swine
Flu In conjunction with its recent re-organization, the Company
has begun discussions with the FDA as its program moves forward
to provide FDA approved solutions for several critical illnesses.

On August 6, 2009 the Company announced the creation of a
Scientific Advisory Board and that Dr. Mitch Earleywine has accepted
its invitation to become the first member of its newly formed
Scientific Advisory Board.  Dr. Earleywine is an Associate Professor of
Psychology at the State University of New York (SUNY) at Albany.
He has received numerous awards for his excellence in teaching
and research. Dr. Earleywine has extensive experience in the areas
of drug and alcohol abuse, and has published 89 peer reviewed
scientific articles, many of which examine marijuana use.
Additionally, Dr. Earleywine has authored 5 books including "The Parents
Guide to Marijuana." He has professional affiliations with the
Association for the Advancement of Behavior Therapy, the Research
Society on Alcoholism Member; Dr. Earleywine is on the Advisory
Board of the National Organization for the Reform of Marijuana
Law (NORML) and is on the Executive Board of the Marijuana Policy
Project (MPP).

On August 12, 2009 the company announced that it has completed
its review of the FDA licensing requirements and has made key
progress with mapping out its initial cannabis drug medicines
for FDA clinical trials. The Company has determined it will have
more than one product in clinical testing and trials at the same time.
 This news comes following the identification of two distinct parallel
paths in developing pharmaceutical products for FDA approval. The first
being the highly publicized H1N1 Swine flu and the deadly
H1N5 Avian flu, and the second being a newly formed initiative for
Veterans who suffer from Post Traumatic Stress Disorder
(PTSD). Together with these initiatives, Cannabis Science is laying
 a solid foundation for entrance into the FDA and other
government regulatory agencies for developing medicines for Influenza,
PTSD and other ailments.

 Unaudited Interim Financial Statements:

The accompanying unaudited interim financial statements have
been prepared in accordance with accounting principles generally
accepted in the United States and applicable Securities and
Exchange Commission ("SEC") regulations for interim financial
information. These financial statements for the interim periods
in 2009 and 2008 are unaudited and, in the opinion of management,
include all adjustments (consisting of normal recurring accruals)
necessary to present fairly the balance sheets, statements of
operations, statements of shareholders' equity, and statements of
cash flows for the periods presented in accordance with accounting
principles generally accepted in the United States. Certain
information and footnote disclosures normally included in financial
statements prepared in accordance with accounting principles
generally accepted in the United States have been condensed or omitted
pursuant to SEC rules and regulations. It is presumed that users of
this interim financial information have read or have access to the
audited financial statements and footnote disclosure for the preceding
 fiscal year contained in the Company's Annual Report on Form
10-K. Operating results for the interim periods presented are not
necessarily indicative of the results that may be expected for the year
ending December 31, 2009.

Significant Accounting Policies:

The Company's management selects accounting principles generally
accepted in the United States of America and adopts methods for
their application.  The application of accounting principles
requires the estimating, matching and timing of revenue and expense.
It is also necessary for management to determine, measure and allocate
resources and obligations within the financial process according to
those principles.  The accounting policies used conform to generally
 accepted accounting principles which have been consistently
applied in the preparation of these financial statements.



8







The financial statements and notes are representations of the
Company's management which is responsible for their integrity and
objectivity. Management further acknowledges that it is solely
responsible for adopting sound accounting practices, establishing and
maintaining a system of internal accounting control and preventing
 and detecting fraud.  The Company's system of internal  accounting
control is designed to assure, among other items, that  1) recorded
transactions  are valid;  2) valid  transactions  are recorded;  and
3) transactions  are  recorded in the proper  period in a timely  manner
 to produce financial  statements which present fairly the financial
condition,  results of operations  and cash  flows of the  Company  for
the  respective  periods  being presented.

Basis of Presentation:

The Company prepares its financial statements on the accrual basis
of accounting.  All intercompany balances and transactions are
eliminated.  During a portion of 2008, the financial statements
included the accounts of Curado Energy Resources, Inc.

In preparing the accompanying unaudited consolidated financial
statements, the Company has reviewed, as determined necessary by
the Company's management, events that have occurred after June 30,
2009, up until the issuance of the consolidated financial
statements, which occurred on August 21, 2009.

Reclassification:

Certain prior year amounts have been reclassified in the consolidated
 balance sheets, consolidated statements of operations and
consolidated statements of cash flows to conform to current period
presentation.  These reclassifications were not material to the
consolidated financial statements and had no effect on net earnings
reported for any period.

Use of Estimates:

The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make
estimates and assumptions that affect certain reported amounts and
disclosures.  Accordingly, actual results could differ from those
estimates.

Recently Issued Accounting Pronouncements:

The Company  does not expect  the  adoption  of  recently  issued
accounting pronouncements  to have a significant  impact on the
Company's  results of  operations, financial position or cash flow.

Cash and Cash Equivalents:

Cash and cash equivalents includes cash in banks with original
maturities of three months or less and are stated at cost which
approximates market value, which in the opinion of management,
are subject to an insignificant risk of loss in value.

Long Lived Assets:

Effective January 1, 2005, the Company adopted Statement of
Financial Accounting Standards No. 144, "Accounting for the
Impairment or Disposal of Long-Lived Assets" ("SFAS 144"),
which addresses financial accounting and reporting for the impairment
or disposal of long-lived assets and supersedes SFAS No. 121,
"Accounting for the Impairment of Long-Lived Assets and for Long-
Lived Assets to be Disposed Of," and the accounting and reporting
 provisions of APB Opinion No. 30, "Reporting the Results of
Operations for a Disposal of a Segment of a Business." The Company
periodically evaluates the carrying value of long-lived assets to
be held and used in accordance with SFAS 144. SFAS 144 requires
impairment losses to be recorded on long-lived assets used in
operations when indicators of impairment are present and the
undiscounted cash flows estimated to be generated by those assets are
less than the assets' carrying amounts. In that event, a loss is
recognized based on the amount by which the carrying amount exceeds
the fair market value of the long-lived assets. Loss on long-lived
assets to be disposed of is determined in a similar manner, except that
fair market values are reduced for the cost of disposal.


9








During the year ended December 31, 2007, the Company had acquired
two oil & gas leases in two separate transactions. One lease
was acquired for cash consideration of $30,000 and the other
lease was acquired in exchange of 500,000 shares. The lease was
valued at the fair market value of the shares which was $5,000,000.

As of December 31, 2007, the Company estimated the future cash
flows expected to result from the use and eventual disposition of
the two oil & well gas leases. Based on its review, the Company
determined that the carrying value of the assets is not recoverable
and hence the leases were determined to be impaired as of December 31,
2007. The Company recorded an impairment loss of $5,030,000
for the year ended December 31, 2007.

In June 2008 the Company acquired eleven oil well leases in a
related party transaction with the majority shareholder, K&D
Investments, for 10,000,000 shares.  The value of the stock at
the time of the transaction was $2,500,000 and the predecessor
cost was $100,000.  Therefore, an impairment of $2,400,000 was
recorded related to the transaction and the net cost recorded on the
Company's balance sheet is $100,000.  The Leases were acquired
into Curado Energy Resources, Inc., the operator of the Leases,
which the Company acquired from South Beach Live, Inc., its most
 significant creditor.

Throughout 3Q 2007, declining oil prices and increased operating
costs made continued oil and gas operations on the Leases
unprofitable, and the Company was continually drawing down on its
 Line of Credit Agreement with South Beach. In exchange for
concessions from South Beach regarding further cash advances and
future stock conversions, in August 2007, the Company agreed to
grant South Beach a security interest in its South Beach shares.

On October 6, 2008, in the face of further oil price declines and
general economic conditions, the Company and South Beach entered
into an Accord and Satisfaction Agreement under which the Company
surrendered its interest in the Putnam "M" oil and gas lease in
Throckmorton Co., Texas in exchange for a complete release on the
Promissory Note and Line of Credit.  In addition, the Company
waived any claim on the shares of Curado common stock that secured
 the Promissory Note or the assets of Curado.  As a result, the
Company's the fourth quarter of 2007's  financial statements will
reflect the disposition of Curado and its assets, and furthermore that
the Company has, once again, become a Development Stage Company
seeking a new business partner or acquisition.  A Form 8-K
reflecting this transaction was timely filed.

Fair Value of Financial Instruments:

Statement of financial accounting standard No. 107, Disclosures about
fair value of financial instruments, requires that the Company
disclose estimated fair values of financial instruments. The carrying
amounts reported in the consolidated balance sheet for current
assets and current liabilities qualifying as financial instruments
are a reasonable estimate of fair value.

Stock-Based Compensation:

In December 2004, the FASB issued SFAS No. 123 (revised 2004),
''Share-Based Payment'' (''SFAS 123R''), which requires the
measurement of all employee share-based payments to employees,
including grants of employee stock options, using a fair-value-
based method and the recording of such expense in the consolidated
statements of operations. In March 2005, the SEC issued Staff
Accounting Bulletin No. 107 ("SAB 107") regarding the SEC's
interpretation of SFAS 123R and the valuation of share-based
payments for public companies. The Company has adopted SFAS 123R
and related FASB Staff Positions ("FSPs") as of January 1,
2006 and will recognize stock-based compensation expense using
the modified prospective method.



10








Income Taxes:

The Company accounts for its income taxes using SFAS No. 109,
"Accounting for Income Taxes," which requires the establishment
of a deferred tax asset or liability for the recognition of future
deductible or taxable amounts and operating loss and tax credit carry
forwards. Deferred tax expense or benefit is recognized as a result
of timing differences between the recognition of assets and
liabilities for book and tax purposes during the year.

Deferred tax assets and liabilities are measured using enacted tax
rates expected to apply to taxable income in the years in which those
temporary differences are expected to be recovered or settled. Deferred
tax assets are recognized for deductible temporary differences
and operating loss, and tax credit carry forwards. A valuation allowance
is established to reduce that deferred tax asset if it is "more
likely than not" that the related tax benefits will not be realized.

Property and Equipment:

Property and equipment are stated at cost less accumulated depreciation.
Major renewals and improvements are capitalized; minor replacements,
maintenance and repairs are charged to current operations.  Depreciation
is computed by applying the straight-line method over the estimated
useful lives which are generally five to seven years.

Earnings per Share (Loss):

The Company adopted the provisions of SFAS No. 128, "Earnings Per Share"
("EPS"). SFAS No. 128 provides for the calculation of basic and diluted
earnings per share. Basic EPS includes no dilution and is computed by
dividing income or loss available to common shareholders by the
weighted average number of common shares outstanding for the period.
Diluted EPS reflects the potential dilution of securities that could
share in the earnings or losses of the entity. For the three month
period ended June 30, 2009, basic and diluted earnings per share is
the same ($0.11) since the calculation of diluted per share amounts
would result in an anti-dilutive calculation.  For the three month
period ended June 30, 2009, basic and diluted loss per share are
$1.38 and $1.37, respectively.

Comprehensive Income:

SFAS No. 130 "Reporting Comprehensive Income", establishes
standards for reporting and display of comprehensive income and its
components in a full set of general purpose financial statements.
For the quarters ended June 30, 2009 and 2008, the Company had no
items of other comprehensive income.  Therefore, the net loss equals
the comprehensive loss for the periods then ended.


NOTE 2 - GOING CONCERN

The accompanying financial statements have been prepared in
conformity with generally accepted accounting principles, which
contemplate the continuation of the Company as a going concern.
The Company reported a cumulative deficit of $51,324,844 and had
a stockholders' deficit of $1,072,914 at June 30, 2009.  The
information included in this Form 10-Q should be read in conjunction
with Management's Discussion and Analysis and Financial Statements
and notes thereto included in the Company's December 31,
2008 Form 10-K.


11








NOTE 3 - FIXED ASSETS

Fixed assets at June 30, 2009 and December 31, 2008 are as follows:

				  June 30, 2009	  Dec 31, 2008

Equipment 			   $   3,000       $    2,000

Less: Accumulated Depreciation          (533)            (433)
				    -------------------------
Total Fixed Assets 		   $   2,467       $    1,567


Depreciation expense for the three-month periods ended June 30,
2009 and 2008 was $100 and $100 respectively.

The Company acquired Cannex's website, which has an estimated
value of $1,000 based on the original cost of the asset.


NOTE 4 - INCOME TAXES

The Company utilizes SFAS No. 109, "Accounting for Income Taxes,"
which requires the recognition of deferred tax assets and
liabilities for the expected future tax  consequences of
events that have been included in the financial  statements or
tax returns. Under this method, deferred income taxes are
recognized for the tax consequences in future years of differences
between the tax bases of assets and liabilities and their financial
reporting amounts at each period end based on enacted tax laws and
statutory tax rates applicable to the periods in which the differences
are expected to affect taxable income.  Valuation allowances are
established, when necessary, to reduce deferred tax assets to the
amount expected to be realized.

The following table sets forth the significant components of the
net deferred tax assets as of June 30, 2009:


				    June 30, 2009   Dec 31, 2008

Net operating loss carry forward   $   51,324,844   $  49,511,884

Total deferred tax assets              17,172,230      16,440,389

Less: valuation allowance             (17,172,230)    (16,440,389)

Net deferred tax assets            $        -       $       -


For the six months ended June 30, 2008, income taxes were offset
by the utilization of a portion of the net operating loss carry
forward.

NOTE 5 - NOTE PAYABLE

On January 11, 2007 the Company entered into an agreement with
Camden Holdings, Inc., also an affiliate of the Company, wherein
the Company memorialized its obligation to pay Camden Holdings,
Inc $650,000 by December 31, 2007 for monies owed to Camden.
The Company also gave Camden the right to convert all or part of
this debt into shares of the Company's common stock at $.01 per
share. The Company recorded a beneficial conversion of $650,000
on the note, which is being amortized over the life of the note.
During the three month period ended March 31, 2007, the Company
amortized $162,500 of this unamortized discount as interest
expense.  The Company recorded an interest payable of $39,318
for the six-month period ended June 30, 2009.



12








On March 25, 2009 Summitt Oil & Gas, Inc. and Melissa 364 CR, Ltd.
entered into a purchase and sale agreement by which Summitt
assigned its rights with respect to debt of $814,742 plus accrued
interest, and sold 400,000 shares of restricted stock.

NOTE 6 - EQUITY TRANSACTIONS

The Company is authorized to issue 30,000,000 shares of common
shares with a par value of $.001 per share.  These shares have full
voting rights.  There were 22,142,279 and 12,597,279 issued and
outstanding as of June 30, 2009 and December 31, 2008.

The Company is also authorized to issue 1,000,000 shares of
preferred stock.  To date, the Company has not filed any manner of
designation rights with the State of Nevada and has no preferred
shares outstanding.


A.
Issuance of Common Stock

On June 6, 2008, the Company entered into an Asset Purchase
Agreement (the "Agreement") with K&D Equity Investments,
Inc., a Texas corporation ("K&D"). Under the terms of the
Agreement, the Company acquired, though Curado Energy Resources,
Inc., working interests in ten (10) oil, gas and mineral leases
(the "Leases") located in Texas, with Net Revenue Interests (N.R.I.)
in these leases ranging from 75% to 84.76%.  Gulf paid K&D
10,000,000 shares of its $.001 par value common stock for the
Leases. K&D was  the owner of 500,000 shares of the Company's
common stock and became its largest single shareholder,
owning  approximately 88% of the Company's issued and outstanding
shares.

On June 13, 2008, the Company issued 500,000 shares of its $.001
par value common stock to South Beach Live, Inc., a Florida
corporation, pursuant to the terms of an October 4, 2007,
Promissory Note.  Under the terms of the Note, the Company was
released from $50,000 of the principal obligation under the Note
in exchange for issuance of these shares.  Provisions of the Note
are fully disclosed in the Company's Form 10-KSB, filed on
April 10, 2008.

On March 30, 2009, the Company entered into an agreement with
Cannex Therapeutics, LLC, a California limited liability
company, and its principal, medical cannabis pioneer and entrepreneur
Steven W. Kubby, to acquire all of their interest in certain
assets used to conduct a cannabis research and development business.
The asset purchase agreement included all of Cannex' and
Kubby's intellectual property rights, formulas, patents, trademarks,
client base, hardware and software, including the website
www.phytiva.com.  The Company and its largest shareholder, K & D
Equity Investments, Inc., paid a total of 10,600,000 shares
of common stock for the assets of Cannex; the Company issued 2,100,000
shares to Cannex, and K & D transferred 8,500,000
shares to Cannex and others.

On May 28, 2009 the Board of Directors of the Company authorized
and approved adoption of a 2009 Stock Compensation Plan.
The plan is authorized to issue 6,500,000 common shares. The
purposes of this Plan are to (i) attract and retain the best available
personnel for positions of responsibility within the Company (ii)
provide incentives to employees, officers, and management of
the Company, (iii) provide Directors, Consultants and Advisors of
the Company with an opportunity to acquire a proprietary
interest in the Company to encourage their continued provision of
services to the Company, and to provide such persons with
incentives and rewards for superior performance more directly
linked to the profitability of the Company's business and increases
in shareholder value, and (iv) generally to promote the success of
the Company's business and the interests of the Company and
all of its stockholders, through the issuance of shares of the
Company's Common Stock. The Company has issued 6,480,000
common shares under the terms of the plan to advisors and
consultants of the Company.

On June 11, 15, and 18th of 2009 the Company issued a total of
975,000, section 144-restricted, common shares for investor
relations services. The shares carry section 144 restrictive legends.



B.
Warrants

No warrants were granted during the six-month period ended June 30, 2009.

The weighted average remaining contractual life of warrants
outstanding is 0.25 years at June 30, 2009.

  Outstanding Warrants			      Exercisable Warrants
 ------------------------------------------------------------
  Range of
Exercise Price    Number      Average    Remaining Average    Number
		            Contractual  Intrinsic value
				Life

 $67.00 	  18,000        0.25           -             18,000





13








The current Exercise Price of $67.00 per share reflects the impact
of the two 1:10 stock splits.  Prior to the splits the
Exercise price was $0.67 per share.

The Company estimated the fair value of each stock warrant at the
grant date by using the Black-Scholes option-pricing mode.

The weighted-average assumptions used in estimating the fair value
of warrants outstanding as of June 30, 2009, along with
the weighted-average grant date fair values, were as follows.


					2009

Expected volatility                    80.0%
Expected life in years		       5 years
Risk free interest rate		       5.07%
Dividend yield			       0%




C.
Employee Options

On April 3, 2006, the Board of Directors of the Company authorized
and approved the adoption of the 2006 Stock Option Plan
effective April 3, 2006 (the "Plan").  The Plan is administered
by the duly appointed compensation committee.  The Plan is
authorized to grant stock options of up to 25,000,000 shares of
the Company's common stock.  At the time a stock  option  is  granted
under  the  Plan,  the compensation  committee  shall fix and determine
the exercise  price and vesting schedules  at which such shares of
common  stock of the Company may be acquired.  As of June 30, 2009,
no options to purchase the Company's common stock have been granted
under the Plan.  There were no options outstanding at June 30, 2009.


In September 2006, the Board of Directors of the Company authorized
and approved the adoption of the 2006-1 Consultants and
Employees Service Plan effective September 7, 2006 (the "Consultants
Plan").  The Plan is administered by the duly appointed
compensation committee.  The Plan is authorized to grant stock
options and make stock awards of up to 38,000 shares of the
Company's common stock.  At the time a stock option  is  granted
under  the  Plan,  the compensation  committee  shall fix and
determine the exercise  price and vesting schedules  at which such
shares of common  stock of the Company may be acquired.
The Consultants Plan was registered on September 15, 2006 and as of
December 31, 2006 a total of 37,990 shares had been
issued and granted under the Consultants Plan.  During 2008 and
2009 no additional shares have been issued under this plan.

On May 28, 2009 the Board of Directors of the Company authorized
and approved adoption of a 2009 Stock Compensation Plan.
The plan is authorized to issue 6,500,000 common shares. The
purposes of this Plan are to (i) attract and retain the best available
personnel for positions of responsibility within the Company (ii)
provide incentives to employees, officers, and management of
the Company, (iii) provide Directors, Consultants and Advisors of
the Company with an opportunity to acquire a proprietary
interest in the Company to encourage their continued provision of
services to the Company, and to provide such persons with
incentives and rewards for superior performance more directly
linked to the profitability of the Company's business and increases
in shareholder value, and (iv) generally to promote the success
of the Company's business and the interests of the Company and
all of its stockholders, through the issuance of shares of the
Company's Common Stock. The Company has issued 6.480,000
common shares under the terms of the plan to advisors and
consultants of the Company.



NOTE 7 - RELATED PARTY

On June 6, 2008, the Company entered into an Asset Purchase
Agreement (the "Agreement") with K&D Equity Investments, Inc., a
Texas corporation ("K&D"). Under the terms of the Agreement,
the Company acquired, though Curado Energy Resources, Inc.,
working interests in ten (10) oil, gas and mineral leases (the
"Leases") located in Texas, with Net Revenue Interests (N.R.I.)
in these leases ranging from 75% to 84.76%.  Gulf paid K&D 10,000,000
shares of its $.001 par value common stock for the Leases. K&D
was the owner of 500,000 shares of the Company's common stock, and
as a result of the Agreement owned approximately 88% of the
Company's issued and outstanding shares.  K & D's president, Jeffrey
Joyce, was an officer of the Company at the time of the
transaction.



14







On June 6, 2008, the Company entered into a Stock Purchase
Agreement ("SPA") with South Beach Live, Inc., a Florida corporation,
to purchase 100% of the common shares of Curado Energy Resources,
Inc., a Texas corporation ("Curado"). Curado is registered with
the Texas Railroad Commission as an oil and gas well operator, and
is the operator for the Leases. The Company has agreed to issue
South Beach a promissory note for $250,000, payable in 1 year at 10%
interest. The Company will close the SPA at the same time it
closes the Agreement.  The Fair Market Value ("FMV") of net assets
of Curado at the time of the transaction were $157,040.  This
generated an amount of Goodwill of $92,960 which is reflected in the
consolidated financial statements.  At the time of the
transaction, Michele Sheriff, who was a director and Secretary of
the Company, was also an officer and the sole director of South
Beach.

In October 2008, the Company and SBL entered into an Accord and
atisfaction Agreement.  Under the terms of the Agreement,
South Beach released the Company from any further obligation
under the parties' $250,000 Promissory Note in exchange for an
assignment of the Company's interest in a (currently) non-producing
oil well, the Putnam M, located in Throckmorton Co., Texas, and
a surrender of any claim to shares of Curado Energy Resources, Inc.,
the Company's wholly-owned subsidiary, currently held by
South Beach under a Security Agreement.  The Company is advised that
South Beach has exercised its rights to these shares and
requested re-registration thereof.

On March 25, 2009 Summitt Oil & Gas, Inc.. and Melissa 364 CR,
Ltd. entered into a purchase and sale agreement under which
Summitt agreed to assign  its rights with respect to debt of
$814,742 plus accrued interest, and to sell 400,000 shares of
restricted stock to Melissa.  The debt comprises the Secured
Convertible Note issued on January 5, 2007, in the amount of
$650,000, further advances of $164,742 (total $814,742) and
accrued interest of $136,346.  South Beach Live is the General
Partner of Melissa.

On March 30, 2009, the Company entered into an agreement with
Cannex Therapeutics, LLC, a California limited liability company,
and its principal, medical cannabis pioneer and entrepreneur
Steven W. Kubby, to acquire all of their interest in certain assets
used to conduct a cannabis research and development business.
The asset purchase agreement includes all of Cannex' and Kubby's
intellectual property rights, formulas, patents, trademarks, client
base, hardware and software, including the website
www.phytiva.com.  The Company and its largest shareholder, K & D
Equities, Inc., exchanged a total of 10,600,000 shares of
common stock for the assets of Cannex; the Company issued 2,100,000
shares to Cannex, and K & D transferred 8,500,000 shares to
Cannex and others.



NOTE 8 - COMMITMENTS AND CONTINGENCIES

A.
Legal

The Company is periodically involved in legal actions and claims
that arise as a result of events that occur in the normal course of
operations. The Company is not currently aware of any formal legal
proceedings or claims that the Company believes will have,
individually or in the aggregate, a material adverse effect on the
Company's financial position or results of operations. (See Note 12)

B.
Operating Leases

The Company has a transitional corporate address at 6946 N Academy
Blvd, Suite B #254 Colorado Springs CO 80918. This address
is paid on a quarterly basis at a cost of $54.00 per quarter. This
address is being used while the Company completes negotiations for
the corporate headquarters and research lab of choice, in Colorado
Springs Co.

C.
Liabilities

The Company had a collection notice for $87,183 related to legal
billings in 2006 that had not been booked.  The amount was
recorded in the third quarter of 2007.  The billings were related
to acquisition work that was never completed.  The Company contends
that the agreement was not with Cannabis Science Inc. but with a
potential acquirer and therefore believes that the accrual is not
necessary.


15








On December 19, 2006, Empire Relations Group Inc. ("Empire")
filed an arbitration claim against the Company in connection with a
consulting agreement entered into by and between the Company and
Empire on September 28, 2006. An arbitration award in the
amount of $13,000 was issued against the Company on March 9, 2007,
which also provided for interest at the rate of nine percent per
annum, commencing 30 days after the date of the award and continuing
until paid in full. The amount has been accrued in the
accompanying financials.

Included in "Accounts payable" on the consolidated balance sheet at
June 30, 2009 and December 31, 2008, the Company has
payables totaling $250,000 to two former directors and one attorney,
which were incurred in 2006 and 2005, respectively.


?
The attorney represented a former related party when it was in
negotiations to acquire the Company in 2005.  The Company's
position is that this is not its liability as it did not contract
the attorney and will pursue a legal opinion in 2009 to reverse the
liability.


?
The former directors were awarded severance agreements in June 2006
shortly before resigning from the Company.  The severance and other
fees totaled $81,250 for each director for a total of $162,500.
The severance was not immediately paid and there has been no
correspondence concerning payment since they resigned.  The states
statute of limitations expires in June 2010 and the Company, at
that time, will accordingly adjust the liabilities to $0 if no demand
is received.

Included in "Accounts payable" on the consolidated balance sheet at
June 30, 2009 and December 31, 2008, the Company also has
payables totaling $70,000 to various vendors incurred in 2005 through
 2007.


?
There is $30,000 balance to a former related party that has not been
resolved.  This liability was incurred in 2005 and there has
been no correspondence with the vendor since the signing of the
contract and unless the vendor contacts the Company, we will
accordingly adjust the liability to $0 in compliance with the
state statutes of limitations of four years, in October of 2009.


?
There is $12,175 to a former consultant that is unresolved.  This
liability was incurred in 2005 and there has been no
correspondence with the vendor since the liability was incurred.
In the event the vendor does not contact the Company, we
will accordingly adjust the liability to $0 in compliance with the
state statutes of limitations of four years, in December of
2009.


?
There is approximately $28,000 of other smaller and aged payables
that the Company will also write-off in future periods
using the applicable stature of limitations as a guide.

NOTE 9 - EXTINGUISHMENT OF DEBT

On March 21, 2008 the Board of Directors determined that it was in
the best interest of the Company and its shareholders to void the
contracts of two former directors and extinguish the associated
liability and related accrued payroll taxes.  The contracts
originated in 2006 and called for the issuance of restricted common
stock in the amount of $5,000,000.  During 2006 a liability for
$5,000,000 and $1,285,651 of related accrued payroll taxes was
recorded.  Accordingly, during the six months ended June 30, 2009,
management has recorded a nonrecurring gain in the amount of $6,285,651.

NOTE 10 - ASSET VALUATION

On March 30, 2009, the Company entered into an agreement with
Cannex Therapeutics, LLC, a California limited liability company,
and its principal, to acquire all of their interest in certain
assets used to conduct a cannabis research and development business.
The asset appraisal to determine the value to be assigned to the
assets included in the transaction is planned to be conducted by the
end of the third quarter of 2009 and therefore will require amended
disclosure pertaining to the assets of the Company. The transaction,
where 2,100,000 shares were exchanged by the Company was valued at
$525,000 based on the price of the stock on March 30, 2009.

NOTE 11 - INTELLECTUAL PROPERTY

IP of $524,000 is a result of the transaction referenced in both
Note 3 and Note 10 with Cannex Thereapeutics, LLC,
("Cannex").   Identified and estimated assets at the time of
this filing was $1,000 for the Company website and the balance was
allocated to IP.  Once the asset valuation referenced in Note 10
is completed it is more than likely that this balance will be adjusted.

NOTE 12 --SUBSEQUENT EVENTS

The Company has become aware of a potential lawsuit that has been
initiated by K & D Equity Investments, Inc. ("K & D"), a
shareholder of the Company and a party to the Asset Purchase
Agreement that the Company entered into and disclosed on a Form 8-K
filed with the SEC on April 7, 2009 (the "Asset Purchase Agreement").
K & D filed suit against Cannex Therapeutics, LLC, another
party to the Asset Purchase Agreement, two of our directors and our
 transfer agent.  K & D is alleging fraud, breach of contract and is
seeking rescission of the Asset Purchase Agreement. Management has
reviewed the suit and believes that it is without merit.

The Company has become aware of a second potential lawsuit that has
been initiated by South Beach Live (SBL), a shareholder of the
Company and associate to K & D Equity Investments, Inc. ("K & D"),
the initiator of the Asset Purchase Agreement that the
Company entered into and disclosed on a Form 8-K filed with the SEC
on April 7, 2009 (the "Asset Purchase Agreement").  SBL filed
suit against the Company for a $100,000.00 promissory note.
Management has reviewed the suit and is reviewing the promissory note
to determine the liability to the Company for the note.







16








Item 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS

This report contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as
amended and Section 21E of the Securities Exchange Act of 1934,
as amended. The Company's actual results could differ materially
from those set forth on the forward looking statements as a result
of the risks set forth in the Company's filings with the Securities
and Exchange Commission, general economic conditions, and changes in
the assumptions used in making such forward looking statements.

General

In the fourth quarter of 2008, Cannabis Science, Inc. (the "Company")
terminated all its oil and gas operations and relinquished all its
rights to oil and gas leases and working interests in oil and gas wells
in exchange for a release of debt.  In the first quarter of 2009, the
Company acquired all of the assets of Cannex Therapeutics, LLC from
Cannex and Steven W. Kubby, and committed itself to research and
development of cannabis based medical products.  The Company owns
intellectual property related to a whole cannabis
extract lozenge, which has demonstrated some efficacy in non-blind
informal testing.  Other research indicates that cannabis extracts
available in non-smoked forms, including lozenges and topical creams,
may have medicinal uses in treating a variety of diseases, the
symptoms of those diseases, and for analgesic purposes.

The Company is committed to research and development of cannabis
extract medicines and intends to pursue Independent New Drug
certification, possibly under the Orphan Drug Act, for such treatments.
We face two significant challenges, financing and government
regulation.

The Company is extremely undercapitalized, and will be reliant on outside
financing from sales of securities or issuance of debt instruments.
 We expect many traditional lenders will be reluctant to provide us
with capital in light of our financial condition and the
nature of our expected business, so that any financing activities will
likely be expensive and result in dilution to the Company.  In this
regard, it should be noted that the Asset Acquisition Agreement among
Cannex, the Company and K & D Equity Investments, Inc. contains
non-dilution provisions that provided additional shares to K & D in
the event our shares are sold privately for less than $1.00
per share.  There is no assurance that any additional financing will
be available or if available, on terms that will be acceptable to the
Company.

Furthermore, although cannabis has been used for medicinal purposes
for over 5,000 years, there is a significant prejudice against
development of smoked cannabis medical products in the medical and
law enforcement communities.  In spite of recent statements by
the current administration that indicate a softening of these views,
marijuana is still classified as a controlled substance.  We can
provide no assurances that we can develop and market our intended
product, or how long government approval, if obtained, will take.

Our goal is not the legalization of marijuana, but instead the
development of FDA-approved and legal non-smoked cannabis based
medicines.  We face not only the challenges of other business at
an early stage of development, but special problems arising from the
nature of our business.  Shareholders and prospective investors
should recognize that any investment in our Company is risky and
speculative, and could result in a total loss.

On June 9, 2009 the Company announced it has received U.S. Federal
Government CAGE/NCAGE Code Certification; CAGE/NCAGE Code: 5FZM9
was obtained through Central Contracting Registration (CCR). The CCR
is the primary vendor database for the U.S. Federal Government and is
used as a government tool for the Department of Homeland Security,
Department of Defense, NATO and NASA Agencies. Specifically the Company
received U.S. Federal Government Classification for North
American Industry Classification System (NAICS) 541711 - Research and
Development in Biotechnology, 621511 - Medical
Laboratories, 624230 - Emergency and Other Relief Services. The Company
has also received U.S. Government Classification for
Standard Industrial Classification (SIC) for 8731 - Commercial Physical
and Biological Research, enabling it to receive government
notifications and requests for services under these classifications.

With the Special Board Resolution held on July 9, 2009 it was resolved
with the majority of the board of directors calling to immediately
remove and terminate all corporate officer contracts with its
President and CEO, Mr. Steven W. Kubby, who had failed to
conduct his duty in the manner that it is in compliance with his
fiduciary duties to preserve shareholder value and corporate integrity.
It was resolved that Dr. Robert Melamede remains as a Director and
be appointed to the position of President & CEO and Secretary
effective immediately and continue the term until the next annual
general meeting. With the Special Board Meeting held on July 10,
2009, the Board has received and has accepted the resignation of
Steven W. Kubby as a member of the Board of Directors.

RESULTS FOR THE QUARTER ENDED JUNE 30, 2009

Our quarter ended on June 30, 2009.  Any reference to the end of the
fiscal quarter refers to the end of the second calendar quarter for
2009 for the period discussed herein.

REVENUE.  Revenue for the six months ended June 30, 2009, was $0
compared to $161,559 for the period ended June 30,
2008.   The decrease is attributed to the oil properties acquired in
2007 and Curado Energy Resources, Inc., ("Curado") acquired in
June 2008 which were disposed of in October 2008.  In March 2009
the Company agreed to purchase the assets of Cannex with the
intent to enter the pharmaceutical industry.

17







GROSS PROFIT.  Gross profit for the six months ended June 30, 2009,
was $0 compared to $67,382 for the period ended June 30,
2008.  The decrease in gross profit is due to the disposition of
lease properties and Curado Energy Resources as mentioned above.

OPERATING EXPENSES. Total operating expenses, net of depreciation
expense of $100 and $100 respectively, for the six months
ended June 30, 2009, were $1,773,542 compared to expenses for the
period ended September 30, 2008 of ($6,165,788).  Expenses for
the period ending June 30, 2008 expenses included a one-time
nonrecurring gain of $6,285,651 due to the voiding of former director
contracts.  Backing out of the one time charge and 2008 expenses
would have been $119,683; 2009 expenses netted a reduction of
$95,177 versus this adjusted figure.  The reduction is due to reduced
professional fees of $28,000 and reduced Other G&A of $67,000
as there were no oil related contract services and other expenses in
2009.

NET INCOME (LOSS. Our net loss for the six months ended June 30
2009 was $1,812,960 compared to net income of $3,735,047 for
the period ended June 30, 2008.  The 2008 balance is impacted
by the voiding of former director contracts and associated payroll
taxes of $6,285,651 as mentioned above.

Employees

As of June 30, 2009, the Company had two employees: its President
and Chief Financial Officer.


ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

N/A


ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

We carried out an evaluation of the effectiveness of the design
and operation of our disclosure controls and procedures (as
defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) as of
June 30, 2009.  This evaluation was accomplished under the
supervision and with the participation of our chief executive
officer / principal executive officer, and chief financial officer /
principal financial officer who concluded that our disclosure
controls and procedures are not effective to ensure that all material
information required to be filed in the annual Form 10-Q/A has
been made known to them.

For purposes of this section, the term disclosure controls and
procedures means controls and other procedures of an issuer that
are designed to ensure that information required to be disclosed
by the issuer in the reports that it files or submits under the Act
(15 U.S.C. 78a et seg.) is recorded, processed, summarized and reported,
within the time periods specified in the Commission's
rules and forms.  Disclosure, controls and procedures include, without
limitation, controls and procedures designed to ensure that
information required to be disclosed by in our reports filed under the
Securities Exchange Act of 1934, as amended (the "Act") is
accumulated and communicated to the issuer's management, including its
principal executive and principal financial officers, or
persons performing similar functions, as appropriate to allow timely
decisions regarding required disclosure.

Based upon an evaluation conducted for the period ended June 30, 2009,
our Chief Executive and Chief Financial Officer as of
June 30, 2009 and as of the date of this Report, has concluded that
as of the end of the periods covered by this report, we have
identified the following material weakness of our internal controls:


?
Reliance upon independent financial reporting consultants for review
of critical accounting areas and disclosures and material
non-standard transaction.


?
Lack of sufficient accounting staff which results in a lack of
segregation of duties necessary for a good system of internal
control.



18








In order to remedy our existing internal control deficiencies,
as our finances allow, we will hire additional accounting staff.

Changes in Internal Controls over Financial Reporting

We have not yet made any changes in our internal controls over
financial reporting that occurred during the period covered
by this report on Form 10-Q that has materially affected, or is
reasonably likely to materially affect, our internal control over
financial reporting.













19








PART II - OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

The Company has become aware of a potential lawsuit that has
been initiated by K & D Equity Investments, Inc. ("K & D"), a
shareholder of the Company and a party to the Asset Purchase
Agreement that the Company entered into and disclosed on a Form 8-K
filed with the SEC on April 7, 2009 (the "Asset Purchase Agreement").
K & D filed suit against Cannex Therapeutics, LLC, another
party to the Asset Purchase Agreement, two of our directors and our
 transfer agent.  K & D is alleging fraud, breach of contract and is
seeking rescission of the Asset Purchase Agreement. Management has
reviewed the suit and believes that it is without merit.

ITEM 2.  UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

None.

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES

None

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

No matter was submitted to a vote of our shareholders, through the
solicitation of proxies or otherwise, during the quarter ended June
30, 2009.


ITEM 5.  OTHER INFORMATION
None.


ITEM 6.  EXHIBITS

The following exhibits are filed with the Form 10-Q:


Exhibit Number / Name of Exhibit
31.1      Certification of Chief Executive Officer, pursuant to
Rule 13a-14(a) of the Exchange Act, as enacted by Section 302 of the
Sarbanes-Oxley Act of 2002.

31.2      Certification of Chief Financial Officer, pursuant to
Rule 13a-14(a) of the Exchange Act, as enacted by Section 302 of the
Sarbanes-Oxley Act of 2002.

32.1      Certification of Chief Executive Officer and Chief
Financial Officer, pursuant to 18 United States Code Section 1350, as
enacted by Section 906 of the Sarbanes-Oxley Act of 2002.

SIGNATURES

In accordance with the requirements 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.



CANNABIS SCIENCE, INC.






Date: August 20, 2009
By:
/s/ Dr. Robert Melamede


Dr. Robert Melamede


President and Chief Executive Officer






Date: August 20, 2009
By:
/s/ Richard Cowan


Richard Cowan


Treasurer and Chief Financial Officer



















EXHIBIT 31.1

CHIEF EXECUTIVE OFFICER CERTIFICATION

I, Dr. Robert Melamede, certify that:

1. I have reviewed this quarterly report on Form 10-Q of CANNABIS
SCIENCE, INC.

2. Based on my knowledge, this quarterly report does not contain
any untrue statement of a material fact or omit to state a material fact
necessary to make the statements made, in light of the circumstances
under which such statements were made, not misleading with
respect to the period covered by this amended quarterly report;

3. Intentionally omitted;

4. The registrant's other certifying officer and I are responsible
for establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-15 (e) and 15d-15(e) and internal
control over financial reporting (as defined in Exchange Act
Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a)
Designed such disclosure controls and procedures, or caused such
disclosure  controls and procedures to be designed under
our supervision, to ensure that material information relating to
the registrant, including its consolidated subsidiaries, is
made known to us by others within those entities, particularly
during the  period in which this report is being prepared;

b)
Designed such internal control over financial reporting, or
caused such internal control over financial reporting to be
designed under our supervision, to provide reasonable assurance
regarding the reliability of financial reporting and the
preparation of financial statements for external purposes in
accordance with generally accepted accounting principles;

c)
Evaluated the effectiveness of the registrant's disclosure
controls and procedures  and presented in this report our
conclusion about the effectiveness of the disclosure controls
and procedures, as of the end of the period covered by this
report based on such evaluation; and

d)
Disclosed in this report any change to the registrant's internal
control over financial reporting that occurred during the
registrant's most recent fiscal quarter (the registrant's fourth
fiscal quarter in the case of an quarterly report) that has
materially affected, or is reasonably  likely to materially affect,
the registrant's internal control over financial reporting;
and

5. The registrant's other certifying officer and I have disclosed,
based on our most recent evaluation of internal control over financial
reporting, to the registrant's auditors and the audit committee of
registrant's board of directors (or persons performing the equivalent
functions):
a)
all significant deficiencies and material weaknesses in the design
or operation of internal controls over financial reporting
which are reasonably likely to adversely affect the registrant's
ability to record, process, summarize and report financial
information; and

b)
any fraud, whether or not material, that involves management or other
employees who have a significant role in the
registrant's internal control over financial reporting.

Date: August 20, 2009

/s/ Dr. Robert Melamede
Dr. Robert Melamede
President and Chief Executive Officer























EXHIBIT 31.2

CHIEF FINANCIAL OFFICER CERTIFICATION

I, Richard Cowan, certify that:

1. I have reviewed this quarterly report on Form 10-Q of
CANNABIS SCIENCE, INC.

2. Based on my knowledge, this quarterly report does not contain
any untrue statement of a material fact or omit to state a material fact
necessary to make the statements made, in light of the circumstances
 under which such statements were made, not misleading with
respect to the period covered by this amended quarterly report;

3. Intentionally omitted;

4. The registrant's other certifying officer and I are responsible
for establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-15 (e) and 15d-15(e) and internal
control over financial reporting (as defined in Exchange Act
Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a)
Designed such disclosure controls and procedures, or caused such
disclosure  controls and procedures to be designed under
our supervision, to ensure that material information relating to
the registrant, including its consolidated subsidiaries, is
made known to us by others within those entities, particularly
during the  period in which this report is being prepared;

b)
Designed such internal control over financial reporting, or
caused such internal control over financial reporting to be
designed under our supervision, to provide reasonable assurance
regarding the reliability of financial reporting and the
preparation of financial statements for external purposes in
accordance with generally accepted accounting principles;

c)
Evaluated the effectiveness of the registrant's disclosure
controls and procedures  and presented in this report our
conclusion about the effectiveness of the disclosure controls
and procedures, as of the end of the period covered by this
report based on such evaluation; and

d)
Disclosed in this report any change to the registrant's internal
control over financial reporting that occurred during the
registrant's most recent fiscal quarter (the registrant's fourth
fiscal quarter in the case of an quarterly report) that has
materially affected, or is reasonably  likely to materially affect,
the registrant's internal control over financial reporting;
and

5. The registrant's other certifying officer and I have disclosed,
based on our most recent evaluation of internal control over financial
reporting, to the registrant's auditors and the audit committee of
registrant's board of directors (or persons performing the equivalent
functions):
a)
all significant deficiencies and material weaknesses in the design
or operation of internal controls over financial reporting
which are reasonably likely to adversely affect the registrant's
ability to record, process, summarize and report financial
information; and

b)
any fraud, whether or not material, that involves management or
other employees who have a significant role in the
registrant's internal control over financial reporting.

Date: August 20, 2009

/s/ Richard Cowan
Richard Cowan
Chief Financial Officer























EXHIBIT 32.1

CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the quarterly report of CANNABIS SCIENCE, INC.
(the "Company") on Form 10-Q for the period ended June 30,
2009 as filed with the Securities and Exchange Commission (the
"Report"), each of the undersigned, in the capacities and on the dates
indicated below, hereby certifies pursuant to 18 U.S.C. Section 1350,
as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of
2002, that:

1. the Report fully complies with the requirements of Section 13(a)
or 15(d) of the Securities Exchange Act of 1934; and

2. the information contained in the Report fairly presents, in all
material respects, the financial condition and results of operation of the
Company.


Dated:  August 20, 2009

/s/ Dr. Robert Melamede

Name: Dr. Robert Melamede

Title:  Chief Executive Officer



Dated:  August 20, 2009

/s/ Richard Cowan

Name: Richard Cowan
Title:  Chief Financial Officer