UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                  Form 10-KSB

(Mark One)

(X) ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
                                      1934

                   For the fiscal year ended December 31, 2006

( ) TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
                                     OF 1934

              For the transition period from _________ to _________

                         Commission file number 0-24930

                               CTD HOLDINGS, INC.
                 (Name of small business issuer in its charter)

            FLORIDA                                   59-3029743
     (State or other jurisdiction of               (I.R.S. Employer
     incorporation or organization)              Identification No.)

                  27317 N. W. 78th Avenue, High Springs, FL 32643
                (Address of principal executive offices) (Zip Code)

                     Issuer's telephone number: (386) 454-0887

Securities registered under Section 12(b) of the Exchange Act:

         Title of each class          Name of each exchange on which registered

                                      None

Securities registered under Section 12(g) of the Exchange Act:

                              Class A Common Stock
                                (Title of class)

     Check  whether  the issuer (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(_).

     Check if there is no disclosure  of  delinquent  filers in response to Item
405 of  Regulation  S-B  contained  in  this  form,  and no  disclosure  will be
contained,  to the  best of  registrant's  knowledge,  in  definitive  proxy  or
information statements incorporated by reference in Part III of this Form 10-KSB
or any amendment to this Form 10-KSB (_).

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

     State issuer's revenues for its most recent fiscal year:  $512,313

     State the aggregate market value of the voting and non-voting common equity
held by  non-affiliates  computed by  reference to the price at which the common
equity was sold, or the average bid and asked price of such common equity, as of
a specified date within the past 60 days:  $130,443.93 based on the average high
($.03) and low ($.03) price as of March 8, 2007, of $.03 per share.

     Note:  If  determining  whether a person is an  affiliate  will  involve an
unreasonable  effort and expense,  the issuer may calculate the aggregate market
value of the common  equity held by  non-affiliates  on the basis of  reasonable
asumptions, if the assumptions are stated.

     State the number of shares  outstanding of each of the issuer's  classes of
common equity, as of the latest practicable date:  15,918,489  shares of
Common Stock as of March 22, 2007.

                       DOCUMENTS INCORPORATED BY REFERENCE


                                      None

     Transitional Small Business Disclosure Format (Check One): Yes (_) No (X)

<PAGE>
PART I

Item 1.  Description of Business.

     CTD  Holdings,  Inc.  ("Us" or "the  Company")  was  organized as a Florida
corporation on August 9, 1990, with  operations  beginning in July 1992. We sell
cyclodextrins  ("Cyclodextrins"  or "CDs")  and  related  products  to the food,
pharmaceutical and other industries.  We also provide consulting services in the
area of commercialization of CD applications.

CDs
     Cyclodextrins  are  molecules  that bring  together  oil and water and have
potential applications anywhere oil and water must be used together.  Successful
applications have been made in the areas of agriculture,  analytical  chemistry,
biotechnology,  cosmetics, diagnostics, electronics, foodstuffs, pharmaceuticals
and toxic waste  treatment.  Stabilization of food flavors and fragrances is the
largest current  worldwide  market for CD  applications.  The Company and others
have  developed  CD-based  applications  in  stabilization  of flavors  for food
products; elimination of undesirable tastes and odors; preparation of antifungal
complexes  for foods  and  toiletries;  stabilization  of  fragrances  and dyes;
reduction of foaming in foods; cosmetics and toiletries;  and the improvement of
quality, stability and storability of foods.

     CDs can improve the solubility and stability of a wide range of drugs. Many
promising drug compounds are unusable or have serious side effects  because they
are either too unstable or too insoluble in water.  Strategies for administering
currently  approved  compounds  involve  injection of formulations  requiring pH
adjustment and/or the use of organic solvents. The result is frequently painful,
irritating,  or damaging. These side effects can be ameliorated by CDs. CDs also
have many potential uses in drug delivery for topical  applications  to the eyes
and skin.

     We  believe  the  application  of CDs in both  OTC and  ethical  ophthalmic
products  provides  the  greatest  opportunity  for the  successful  and  timely
introduction of CD containing preparations for topical drug use.

     We  provide  consulting  services  for the  commercial  development  of new
products  containing  CDs.  Our  revenues  are  derived  from  consulting,   the
distribution of CDs, the  manufacturing  of selected CD complexes,  and sales of
our own manufactured and licensed products containing CDs.

<PAGE>

CD Product Background

     CDs are donut shaped circles of glucose (sugar)  molecules.  CDs are formed
naturally by the action of bacterial enzymes on starch.  They were first noticed
and  isolated in 1891 by a French  scientist,  Villiers,  as he studied  rotting
potatoes.  The bacterial  enzyme  naturally  creates a mixture of at least three
different  CDs depending on how many glucose units are included in the molecular
circle; six glucose units yield Alpha CD ("ACD");  seven units, beta CD ("BCD");
eight units, gamma CD ("GCD").  The more glucose units in the circle, the bigger
the circle,  or donut. The inside of this "donut" provides an excellent  resting
place for  "oily"  molecules  while the  outside  of the donut is  significantly
compatible with water enabling clear stable solutions of CDs to exist in aqueous
environments  even when an "oily" molecule is carried within the donut hole. The
net result is a molecular carrier that comes in small,  medium,  and large sizes
with the ability to transport and deliver  "oily"  materials  using water as the
primary vehicle.

     CDs are manufactured in large quantities by mixing appropriate enzymes with
starch solutions,  thereby reproducing the natural process. ACD, BCD and GCD can
be manufactured  by an entirely  natural process and therefore are considered to
be natural products.  Additional  processing is required to isolate and separate
the CDs. The purified ACD, BCD, and GCD are referred to  collectively as natural
CDs (NCDs).

     The chemical groups on each glucose unit in a CD molecule  provide chemists
with ways to modify  the  properties  of the CDs,  i.e.  to make them more water
soluble or less  water  soluble,  thereby  making  them  better  carriers  for a
specific chemical. The CDs that result from chemical modifications are no longer
considered  "natural" and are referred to as chemically  modified CDs ("CMCDs").
Since  the  property  modifications  achieved  are  often so  advantageous  to a
specific  application,  the Company  does not believe the loss of the  "natural"
product  categorization  will  prevent  its  ultimate  commercial  use. It does,
however, create a greater regulatory burden.

     Our  strategy is to sell CDs and to  introduce  products  with little or no
regulatory  burden in order to minimize product  expenses and create  profitable
revenue.

     We  currently  sell our products  for use in the  pharmaceutical,  food and
industrial chemical industries.

<PAGE>

CD Market

     The food additive industry has been  experimenting with CDs for many years.
Now that  commercial  supply of these  materials  can be assured and  regulatory
approval is in place,  the Company  believes  the food  additive  industry  will
continue to increase its use of CDs.

     CDs have  been  used in a  variety  of food  products  in Japan for over 25
years. In 1999 the economic impact of CD's on the Japanese  economy was reported
to be $2.6 billion.  Within the last five years,  more European  countries  have
approved the use of CDs in food  products.  In the United  States,  major starch
companies are renewing  their earlier  interest in CDs as food  additives.  Oral
arguments  for   regulatory   approval  by  the  United  States  Food  and  Drug
Administration  ("FDA") have been accepted. As of November 3, 1997, BCD use as a
food  additive in 10  categories  of food products was confirmed to be generally
recognized as safe (GRAS).

     Applications  of CDs in  personal  products  and for  industrial  uses have
appeared in many patents and patent  applications.  Procter & Gamble uses CDs in
Bounce(R), a popular fabric softener and Febreze(R). Avon uses CDs in its dermal
preparations using its Age Protective System APS(R). These uses will grow as the
price of the manufactured CDs decrease or are perceived as acceptable in view of
the value added to the products. In 2001 Janssen Pharmaceutica,  a subsidiary of
Johnson  &  Johnson  received  approval  to  market  Sporanox(r),  an  oral  and
injectable formulation containing hydroxypropyl BCD.

     In Japan at least twelve pharmaceutical preparations are now marketed which
contain  CDs.  The CDs permit the use of all routes of  administration.  Ease of
delivery and improved bioavailability of such well-known drugs as nitroglycerin,
dexamethasone,  PGE(1&2),  and cephalosporin permit these "old" drugs to command
new market share and sometimes new patent lives. Because of the value added, the
dollar  value  of the  worldwide  market  for  products  containing  CDs and for
complexes of CDs can be 100 times that of the CD itself.

<PAGE>

CD Products

     Our CD products include Trappsol(R), Aquaplex(R), and AP(TM)-Flavor product
lines.  The  Trappsol  product  line  consists of  approximately  200  different
varieties of CDs and the Aquaplex  product line  includes more than 60 different
complexes of active  ingredients  with various CDs. In addition to these product
lines,  the Company  introduced  Garlessence(R)  in the fourth  quarter of 1995.
Garlessence is the first ingestible product containing CDs to be marketed in the
U.S. The Company also provides consulting services,  research coordination,  and
the use of CD Infobase(TM),  a comprehensive database of CD related information.
The Company has protected its service and trade marks by  registering  them with
the U.S.  Patent  and  Trademark  office.  The  following  trademarks  have been
approved and are in use: Trappsol(R),  and Aquaplex (R). These properties add to
the  intangible  asset  value  of the  Company.  Since  2000,  our  Web  Site at
http://www.cyclodex.com,  a major  tangible  asset  has  grown  to be a  leading
Cyclodextrin information site on the Internet.

     CTD  purchases  CD's  from  commercial   manufacturers   around  the  world
including:  Wacker Chemie - Munich, Germany; Nihon Shokuhin Kako - Tokyo, Japan;
Roquette Freres - Le Strem, France;  Cerestar Inc. - Hammond IN, USA. At the end
of 2002,  CTD  became  the  exclusive  distributor  in North  America  of the CD
products  manufactured  by Cyclolab R&D Labs in Budapest,  Hungary.  The Company
does not manufacture cyclodextrins.

     We have  introduced  many new  products  into our basic  line of CDs and CD
complexes--liquid  preparations of CDs; relatively  unprocessed,  less expensive
mixtures of the natural CDs; naturally modified CDs (glucosyl and maltosyl); and
finally,  excess  production  of  custom  complexes  when  those  items  are not
proprietary or restricted by the customer.

Business Strategy

     Our  strategy  has been  and will  continue  to be to  generate  profitable
revenue through sales of CD related products.

     From  inception  through the current year,  sales of CDs and CD derivatives
have been  sufficient  to provide the  necessary  operational  profitability  to
sustain the Company.  Since these  materials  were simply  purchased and resold,
they had the least value-added attributes.

<PAGE>

     Presently,  sales of CD  complexes  represent a majority  of the  Company's
product sales revenues.  Transition to the more value-added  complexes continues
and is  desirable  for  increased  profitability  since  higher  margins  can be
maintained for these  products.  We have  increased our list of major  customers
from 3 to 4 thereby continuing to reduce our dependency on sales to a very small
core of repeat purchases.

     We intend to increase our business development efforts in the food additive
and personal  products  industries while continuing to build on our successes in
the pharmaceutical industry.

     Business  development  on behalf of the Company's  clients will include the
following:  (i) negotiation of rights and/or licenses to CD-related  inventions;
(ii)  consultation  with  manufacturers  to establish  customized  manufacturing
specifications; (iii) patentability assessments and strategic planning of patent
activities;  (iv) trade secret strategies;  (v) regulatory  interface;  and (vi)
strategic marketing planning.

     The Company  believes its competitive  advantage lies in its experience and
know how in the use and  application  of CDs,  areas in which it believes it has
few equals.

     In addition to its  licensing  efforts,  the Company  intends to coordinate
research  studies in which it will  retain a portion of the rights  created as a
result of the research work supported.

     Assuming the  availability of funds,  the Company will negotiate  licensing
rights to its own selected  inventions.  Because of its comprehensive  technical
and patent  database  for  CD-related  inventions,  the  Company  believes it is
uniquely   positioned  to  take  advantage  of  constantly   evolving  licensing
situations.

<PAGE>

Marketing Plan

     We believe  the failure of  businesses  to  exchange  information  about CD
molecules has hindered a more rapid commercialization of CDs as safe excipients.
We believe our  philosophy of  partnering  and sharing will act as a catalyst to
create momentum overcoming the inertia created by the previous  conservatism and
secrecy.

     Our sales have always been direct, volatile and driven by the acceptance of
CD's  as  beneficial  excipients.  Arrangements  with  large  laboratory  supply
companies and several  diagnostic  companies  have provided a strong sales base,
that continues to diversify.

     The Company has taken advantage of the propensity of researchers to use the
Internet to gather information about new products by establishing a website with
the unique and descriptive domain name "cyclodex.com".

     We intend to work with clients in countries where current  regulatory views
include CDs as natural  products  acting as excipients  to introduce  beneficial
pharmaceuticals improved by CDs.

     Along  with  the  new  products  themselves,  the  Company  has  created  a
licensable  mark  that  may be  used  by  other  manufacturers  wishing  to take
advantage of the improved aqueous delivery afforded by Trappsol CDs.

     We  intend to  generate  additional  revenue  through  obtaining  rights to
certain patents that we will sublicense to appropriate  organizations or that we
will use to develop our own proprietary products. Revenue would then be expected
to result from sub-licensing royalties,  sales of CD complexes to be used in the
newly developed  pharmaceuticals,  and finally from the sales of the products to
end-users.

     Assuming  an  ongoing  successful  process  of  development,  approval  and
adoption  of CDs  and  CMCDs  for  pharmaceutical  applications,  the  Company's
objective is to initiate  dialogue and be well  prepared for  partnerships  with
major food  companies.  Price is a primary  concern in this  market,  but unlike
pharmaceuticals where FDA permission for clinical testing may be obtained before
actual  FDA  product   approval,   food  companies   cannot  feed   experimental
formulations to test panels of consumers until the  ingredients,  i.e., the CDs,
receive approval for human  consumption.  Therefore,  the Company will work with
the food companies and key university food research groups to initially evaluate
non-taste  applications.  These  questions will initially be explored using NCDs
since commercial  adoption will depend heavily upon the price of the CD selected
and NCDs will always be the least  expensive.  The benefits derived from the use
of CDs with expensive ingredients (e.g., flavors, fragrances)have already become
accepted  commercial  uses for CMCDs  (chemically  modified CDs) and  (naturally
modified CD's) NMCDs.

<PAGE>

Competition

     The Company is currently a leading consultant in determining  manufacturing
standards  and costs for CDs and CMCDs.  However,  there will  always  exist the
potential  for  competition  in this  area  since no  patent  protection  can be
comprehensive and forever exclusive.  Nevertheless, there is a perceived barrier
to entry into the CD industry because of the lack of general  experience with CD
complexation   procedures.   The  Company  has  established  a  strong  business
relationship with one of the experts in this field -- Cyclolab in Hungary -- and
has utilized the services and expertise of this laboratory. The Company believes
this relationship  provides a significant marketing lead time, and combined with
a strong marketing presence, will give the Company a two to three year lead time
advantage over its competitors.

     In 2002 we  became  the  exclusive  North  American  distributor  of the CD
products  manufactured  by  Cyclolab.  We  intend  to form  additional  business
relationships  with  Cyclolab in Hungary by creating a  Cyclolab-USA  laboratory
facility and thereby strengthen our competitive advantage.  The Company believes
that it will be able to acquire, and is currently negotiating to acquire, all of
the  outstanding  equity  interest in  Cyclolab  for a total  purchase  price of
$1,525,000.  The Company anticipates that in connection  with its acquisition of
Cyclolab, it would issue options to Cyclolab's current owners to purchase shares
of CTD Holdings for a purchase price of $0.01 per share.

Government Regulation

     Under the Federal  Food,  Drug and Cosmetic Act ("Food and Drug Act"),  the
Food  and  Drug  Administration  ("FDA")  is given  comprehensive  authority  to
regulate the development,  production,  distribution,  labeling and promotion of
food and drugs. The FDA's authority  includes the regulation of the labeling and
purity of the Company's  food and drug  products.  In the event the FDA believes
any company is not in compliance with the law, the FDA can institute proceedings
to detain or seize  products,  enjoin  future  violations or assess civil and/or
criminal penalties against that Company.

     The FDA and comparable  agencies in foreign  countries  impose  substantial
requirements  upon the introduction of therapeutic drug products through lengthy
and detailed laboratory and clinical testing procedures, sampling activities and
other costly and time consuming  procedures.  The extent of potentially  adverse
government   regulations   which  might  arise  from   future   legislation   or
administrative action cannot be predicted.

     Under present FDA regulations,  FDA defines drugs as "articles intended for
use in the diagnosis,  cure,  mitigation,  treatment or prevention of disease in
man." The Company's product development strategy is to first introduce a product
that will not be regulated  by the FDA as a drug because all of its  ingredients
are natural  products or is  generally  regarded as safe (GRAS) by the FDA.  The
Company is continually  updated by counsel as to changes in FDA regulations that
might  affect the use of and claims for these  products.  There is no  assurance
that the FDA will not take the position that the Company's food and  nutritional
supplement products are subject to requirements relating to drug development and
sale.  The  effect  of  such  determination   could  be  to  limit  or  prohibit
distribution of such products.

Employees

     The  Company  employed  three  persons  on a full time  basis.  None of the
Company's  employees belong to a union. The Company believes  relations with its
employees are good.

<PAGE>

Item 2.  Description of Property.

     In 2000,  the  Company  bought  approximately  40 acres in western  Alachua
County,  Florida,  (the  "Property")  for a purchase price of $210,000 which was
paid for in part by a new first  mortgage of  $150,000.  The  Property  had been
developed  in part  as a  mushroom  growing  facility.  While  the  Company  has
discontinued mushroom growing operations on the Property,  the Company continues
to use the  Property as its  corporate  headquarters.  Its present  6,000 sq.ft.
facility is expected to be adequate to house the  Company's  operations  for the
foreseeable future.

     The  Company  holds  title to the  Property  in fee  simple,  subject  to a
purchase money mortgage securing repayment of a promissory note with a principal
balance due of $143,764 as of December 31, 2006. The principal amount due on the
note accrues interest at a rate of seven and one-quarter (7.25) percent per year
and neither the note nor the mortgage  have a prepayment  penalty.  The maturity
date of the note is December 5, 2005.  The Property is not subject to any lease,
option,  purchase,  or sales  contracts,  nor are there any  immediate  plans to
renovate,  improve, or further develop the Property. The Property is in a region
that is  experiencing  moderate  population  and  development  growth  which has
increased  the market value of the Property.  Management  believes the limits of
insurance coverage are adequate for the Property.

     The Property has a 6,000 sq.ft.  facility  from which the Company  operates
its corporate offices. The anticipated  remaining useful life of the facility is
undetermined,  but in  Management's  estimate  exceeds 25 years.  The Property's
federal tax basis, rate, and method are,  respectively,  $162,000, 40 years, and
straight-line.  The realty  tax rate and annual  realty  taxes  assessed  on the
Property for the year ended  December 31, 2006,  are 23.2303 mils and $3,124.00,
respectively.


Item 3.  Legal Proceedings.

     On  February  7, 2007,  Registrant  and C.E.  Rick  Strattan  filed suit in
Circuit Court in Palm Beach County,  Florida,  (Case Number  2007CA001818XXXXMB)
seeking the return of the Class A Preferred  Share and damages  from  defendants
Eline  Entertainment  Group,  Inc., Eline Holding Group,  Inc.,  Yucatan Holding
Company,  Steven  T.  Dorrough,  Jayme  Dorrough,  and Barry  Rothman,  based on
representations  made in  connection  with the Share  Exchange  Agreement  dated
August 11, 2005, as amended and the enforcement of the agreement.


Item 4.  Submission of Matters to a Vote of Security Holders.
         None

<PAGE>
Part II

Item 5.  Market for Common Equity and Related Stockholder Matters.

     In October 1994, the Company's securities began trading on the OTC Bulletin
Board and in the over-the-counter market "pink sheets" under the symbol CTDI. In
2000,  CTDI did a 2 for 1 split of its  common  shares  from  approximately  2.3
million  to 4.6  million  issued  and  outstanding.  In  conjunction  with  that
restructuring,  we changed the name of CTDI to CTD Holdings,  Inc; CTDI was then
incorporated as a Florida  corporation  and became a wholly owned  subsidiary of
CTD Holdings,  Inc. In 2000 CTD  Holdings,  Inc.  changed its trading  symbol to
CTDH.OB and  currently  trades on the OTC Bulletin  Board as CTDH.OB.  Since the
commencement of trading of the Company's securities, there has been an extremely
limited market for its  securities.  The following table sets forth high and low
bid quotations for the quarters indicated as reported by the OTC Bulletin Board.

                                    High               Low


2005          First Quarter        $ 0.075           $ 0.071
              Second Quarter       $ 0.074           $ 0.073
              Third Quarter        $ 0.076           $ 0.072
              Fourth Quarter       $ 0.049           $ 0.047

2006          First Quarter        $ 0.09            $ 0.03
              Second Quarter       $ 0.07            $ 0.04
              Third Quarter        $ 0.05            $ 0.03
              Fourth Quarter       $ 0.05            $ 0.02


     Over-the-counter  market quotations reflect  inter-dealer  prices,  without
retail  mark-up,   mark-down  or  commissions  and  may  not  represent   actual
transactions.

Holders

     As of March 22,  2007,  the number of holders of record of shares of common
stock,  excluding the number of beneficial  owners whose  securities are held in
street name was approximately 77.

Dividend Policy

     The Company  will not pay any cash  dividends  on its common  stock in 2006
because it  intends to retain its  earnings  to  finance  the  expansion  of its
business.  Thereafter,  declaration of dividends will be determined by the Board
of Directors in light of conditions then existing,  including without limitation
the Company's financial condition, capital requirements and business condition.

<PAGE>

Recent Sales of Unregistered Securities

     None.

Item 6. Management's Discussion and Analysis or Plan of Operation.

Introduction

CTD  Holdings,  Inc.  (referred to as the  "Company,"  "CTD," or "we," "us," and
"our") began  operations in 1990. Our revenues are principally  derived from the
resale of cyclodextrins and cyclodextrin  complexes.  Our sales are primarily to
major chemical supply houses around the world,  pharmaceutical  companies,  food
companies for research and development and to diagnostics companies.  We acquire
our products principally from outside the United States,  largely from Japan and
Hungary,  but are gradually  finding  satisfactory  supply sources in the United
States.  While we enjoy better  supply  prices from  outside the United  States,
rising shipping costs are making domestic sources more competitively  priced. To
add value to our products, we maintain a database of patented and patent pending
uses of  cyclodextrins  as  recorded  by the United  States  Patent &  Trademark
Office.  We also maintain a database that includes  patents issued in many other
countries of the World. This information is available to our customers.  We also
offer our customers our  knowledge of the  properties  and potential new uses of
cyclodextrins and complexes.

As most of our customers  use our  cyclodextrin  products in their  research and
development activities, the timing, product mix, and volume of their orders from
us are  unpredictable.  We also have four major customers who have a significant
effect on our  revenues  when they  increase  or  decrease  their  research  and
development activities that use cyclodextrins.  We keep in constant contact with
these  customers  as to their  cyclodextrin  needs so we can maintain the proper
inventory  composition and quantity in anticipation of their needs. The sales to
major  customers  and  the  product  mix  and  volume  of  products  sold  has a
significant effect on our revenues and gross profit. These factors contribute to
our potentially  significant revenue volatility from quarter to quarter and year
to year.

In 2004, we amended the Company's Articles of Incorporation authorizing a series
of "blank check"  preferred stock  consisting of 5,000,000 shares and creating a
series of Series A Preferred Stock,  setting forth its designations,  rights and
preferences.  The more significant right is Series A Preferred shareholders vote
with the  holders  of common  stock on all  matters  submitted  to a vote of our
shareholders.  Share of Series A Preferred  Stock are  entitled to one vote more
than one-half of all votes  entitled to be cast by all holders of voting capital
stock of the Company on any matter  submitted to holders of common  shares so as
to  ensure  that the votes  entitled  to be cast by the  holder of the  Series A
Preferred  Stock  are  equal to at least a  majority  of the  total of all votes
entitled  to be cast by the  holders of common  shares.  In 2004,  we issued one
share of Series A Preferred Stock to C.E. Strattan,  our majority shareholder in
exchange for 1,029,412  shares of common stock held by him, which he voluntarily
surrendered to the Company and were cancelled. Effective August 11, 2005, C.E.

<PAGE>

Strattan  contractually  transferred  the one  outstanding  share  of  Series  A
Preferred Stock to Eline Entertainment  Group, Inc. (Eline).  The agreement with
Eline  provides for advances to the Company of up to an aggregate of  $1,500,000
to acquire  Cyclolab,  at Eline's  sole  discretion.  Eline is an SEC  reporting
company currently not in reporting compliance.  In September 2006, the company's
President, Mr. Strattan,  demanded, in accordance with the expired contract, the
return  of  the  Series  A  Preferred  Stock  in  the  form  of  a  stock  power
authorization since the physical share never left the possession of its original
owner,  Mr.  Strattan.  The demand  letter was sent to the address  given in the
contract and was never  acknowledged  nor responded to by Eline. The Company has
filed a legal  action  with  regard to its  agreement  with  Eline.  See  "Legal
Proceedings".

Liquidity and Capital Resources

Our cash and short-term  investments remained at approximately  $159,000 as of
December 31, 2006 . Our cash flow from operations for 2006 was $26,000  compared
to $129,000 for 2005. The decreased cash flow from  operations  from 2005 is due
primarily  to $112,000  of  expenses  related to the  attempted  acquisition  of
Cyclolab.  While we reported a net loss in 2006 of $102,000,  we had $134,000 in
noncash  expenses in 2006.  The  decreased  loss is due a number of factors.  We
realized a increase  of $88,000 in revenue  and a $150,000  decrease in selling,
general and administrative  expenses (excluding $112,000 of costs related to the
attempted  acquisition  of  Cyclolab)  in 2006  compared  to 2005.  The  largest
decrease in expenses was in stock  compensation and bonuses ($38,000  decrease).
In 2006, we recorded a $50,000 impairment expense on the Collection; in 2005, we
reported a net  $161,000  gain on the  Collection  (net of a $42,000  impairment
expense), and a $225,000 deferred tax valuation allowance expense.

We believe our working  capital is sufficient  to run our  operations at current
and expected  future  operating  levels into the near future.  We do not require
capital in the next twelve months for normal operations.  During 2005, we signed
a letter of intent to  acquire a  majority  interest  in  Cyclolab,  located  in
Hungary . During 2006, we were unable to obtain the capital necessary to acquire
Cyclolab and discontinued  our efforts to do so. We expensed  $112,000 in legal,
accounting, and travel costs associated with the Cyclolab acquisition in 2006.

<PAGE>

Controlling  cash expenses  continues to be  management's  primary  fiscal tool.
However,  growth  requires  increased  expenditures  and  while  we  feel  it is
appropriate  during the current growth stage to engage consultants that can help
the Company in financial areas outside its expertise, these consulting fees will
act to reduce profitability. We are working hard to increase revenues to balance
these new  expenses,  but cannot be sure such effort will be enough in the short
term to sustain financial performance like that of the recent past.

During 2004, we acquired a sports memorabilia collection from our President.  We
received  $5,000  in 2005 and  there  have  been no  sales  in 2006.  We sold no
Collection items in 2006. Beginning in 2007 we plan to begin using E-Bay to list
items for sale. We have no prior  experience in retail sales or in selling items
on E-Bay. During 2006 and 2005, we recorded a valuation allowance of $50,000 and
$42,000, respectively on the collection due to the lack of marketability.

Beginning in 2003, we began improvements and renovations of our corporate office
and have invested  $123,000 through December 31, 2004. During 2005, we suspended
our improvement and renovations  program to redirect our financial  resources to
the  Cyclolab  acquisition.  During  2006,  we  capitalized  $17,000.  We remain
committed  to a  Research  Park  facility  for  the  40-acre  site.  The  office
renovations  will be followed by improved  security  operations and modest guest
facilities.  Contingent on the Company's  ability to financially  support modest
expansions that will lead to a formal site plan, we anticipate spending at least
another  $100,000  over the next two years to position the Company to initiate a
5-year plan for a new Cyclodextrin Research Park.

In April 2004, we acquired a collection of sports  memorabilia from our majority
shareholder  and  President in exchange for  1,029,412  shares of common  stock.
While we received a $400,000 appraisal on the collection, we recorded this asset
for $106,000,  which represents our majority  shareholder's  cost basis. We also
engaged a consultant  under a one year contract to liquidate the  collection for
not less than 75% of its book value as stated in any of the leading collectibles
industry guide books.  This agreement  expired in April 2005. The consultant was
issued 250,627  shares of common stock valued at $100,250,  which we expensed in
2004. We also agreed to an option whereby the consultant  could have acquire the
entire  collection  for  $200,000.  We  recorded  the fair value of this  option
($204,000)  as a  liability  and a charge to  operations  in 2004.  In 2005,  we
recorded a $204,000 gain when the option expired.

We issued 1,791,873 shares and 1,443,151 shares of our common stock to employees
for  compensation  earned  under  employment   agreements  for  2006  and  2005,
respectively.

We have no off-balance sheet arrangements as of December 31, 2006.

<PAGE>

Results of Operations and Critical Accounting Policies and Estimates

The results of operations are based on the preparation of consolidated financial
statements in conformity with accounting  principles  generally  accepted in the
United States.  The preparation of consolidated  financial  statements  requires
management to select accounting  policies for critical  accounting areas as well
as  estimates  and  assumptions   that  affect  the  amounts   reported  in  the
consolidated  financial  statements.  The Company's accounting policies are more
fully  described  in  Note 1 of  Notes  to  Consolidated  Financial  Statements.
Significant  changes in assumptions and/or conditions in our critical accounting
policies could materially impact the operating  results.  We have identified the
following accounting policies and related judgments as critical to understanding
the results of our operations.

Baseball Memorabilia Collection Asset

The  recoverability  of our baseball  memorabilia  collection asset is evaluated
annually or more  frequently  if  impairment  indicators  exist.  Indicators  of
impairment  include losses realized on sales and our future  operating plans. If
impairment  indicators exist, we evaluate the  recoverability of the asset using
an overall  collection  basis based on  undiscounted  expected future cash flows
based  on  individual   collection   piece  values  published  in  auction-house
guidebooks and/or reputable trade publications and price guides,  less estimated
costs to sell the  collection.  The  recorded  value for the  collection  is not
expected to be recovered through  undiscounted future cash flows is written down
to current fair value, which is generally  determined from estimated  discounted
future net cash  flows.  We  recorded an  impairment  allowance  for $50,000 and
$42,000 as of December  31, 2006 and 2005,  respectively.  At December 31, 2006,
our valuation allowance equaled our recorded cost of the Collection.

Long-Lived Assets

The recoverability of long-lived assets is evaluated annually or more frequently
if impairment  indicators  exist.  Indicators of impairment  include  historical
financial  performance,  operating  trends and our future  operating  plans.  If
impairment indicators exist, we evaluate the recoverability of long-lived assets
on an  operating  unit basis based on  undiscounted  expected  future cash flows
before  interest for the expected  remaining  useful life of the operating unit.
Recorded  values for  long-lived  assets that are not  expected to be  recovered
through  undiscounted  future cash flows are written down to current fair value,
which is generally  determined from estimated  discounted  future net cash flows
for assets held for use or net realizable value for assets held for sale.

<PAGE>

At December 31, 2006, we have idle buildings located on the same property as our
corporate offices that were used in our former mushroom farming  operation.  The
carrying value of these idle  long-lived  assets is $77,000.  We have determined
the fair value of these assets  exceeds this carrying value based on recent real
estate  appraisal.  We continue to  depreciate  the assets over their  estimated
useful  life.  Should the value of these assets  decline,  we may be required to
record an impairment charge that could be significant.  During 2006, the Company
recorded an $12,500 impairment  allowance for an autoclave not currently used in
the Company's operation.

Valuation Allowance on Deferred Tax Assets

SFAS 109,  "Accounting  for Income  Taxes"  requires that deferred tax assets be
evaluated  for future  realization  and reduced by a valuation  allowance to the
extent we believe a portion will not be realized.  We consider many factors when
assessing  the  likelihood  of future  realization  of our  deferred  tax assets
including our recent  cumulative  earnings  experience,  expectations  of future
taxable  income,  the  carry-forward  periods  available to us for tax reporting
purposes, and other relevant factors. At December 31, 2006, our net deferred tax
assets are $515,000,  comprised  principally of net operating loss carryforwards
(NOLs),  with the  remaining  portion  related to temporary  timing  differences
between tax and  financial  reporting.  Classification  of  deferred  tax assets
between  current and  long-term  categories  is based on the expected  timing of
realization, and the valuation allowance is allocated on a prorata basis.

We reported a financial net loss of  $(101,000),  During 2006, we maintained our
deferred tax asset  valuation  allowance at 100% based on the Company's  current
loss, its history of prior losses,  and our sales  volatility that  collectively
reduces the chance of  realization  of our  deferred tax assets.  . In 2005,  we
increased our valuation allowance to 100% from 48%, which resulted in income tax
expense of $225,000.  The range of possible  judgments relating to the valuation
of our deferred tax asset is very wide.  For example,  in 2005 we determined the
weight of available  evidence  did not support a decision  that a portion of our
deferred  tax assets will be  realized,  resulting  in the income tax expense of
$225,000.  Alternatively,  if we had  concluded  that the  weight  of  available
evidence  supported a decision that substantially all of our deferred tax assets
may be realized, we would have a substantial income tax benefit in our statement
of operations.

Significant  judgment  is required  in making  this  assessment,  and it is very
difficult to predict when, if ever, our assessment may conclude our deferred tax
assets is realizable.

<PAGE>

2006 Compared to 2005

Total  product sales for 2006 were  $542,000,  a 19% increase over 2005 sales of
$454,000.  Our major customers  continue to be repeat  purchasers.  In 2006, our
four largest customers accounted for 58% of our sales; the largest accounted for
22% of sales.  In 2005,  our four  largest  customers  accounted  for 68% of our
sales; the largest accounted for 27% of sales.

Our gross profit margin of 77% for 2006 decreased  significantly compared to 85%
for 2005.  Changes in the product mix in sales has a  significant  effect on our
overall  gross profit  percentage.  For 2006, we acquired  more  inventory  from
Cyclolab due to our acquisition  plan, which often was more expensive than other
suppliers.  Management  expects our gross  profit to remain in the 70% range for
2007.

Our SG&A expenses decreased to $351,000 in 2006 from $500,000 in 2005 (excluding
$112,000 of costs in 2006 related to the  attempted  acquisition  of  Cyclolab),
primarily as a result of a reduction in stock based compensation to officers and
consultants.  In 2006,  we  incurred  $112,000  in direct  expenses  related  to
consulting,  legal and  accounting  fees  incurred as a result of the  Company's
attempted acquisition of Cyclolab.

For 2006 and 2005, the Company has employment  agreements  with two officers for
total  monthly  salaries of $4,900.  In  addition,  each month the  officers are
awarded  shares of common  stock  restricted  by Rule 144.  The number of shares
awarded is equal to $6,000 divided by eighty percent of the closing price of the
Company's common stock on the last day of each month. The Company  recognizes an
expense equal to the fair value of the stock  determined using the average stock
closing  trading price for the month  multiplied by number of shares awarded for
that month.  The stock is subject to trading  restrictions  under Rule 144.  For
2006, the Company awarded  1,791,873 shares and recognized an expense of $84,000
for stock  awarded  under  these  agreements.  For  2005,  the  Company  awarded
1,443,151  shares and  recognized  an expense of $92,000 for stock awarded under
these agreements. We have executed new employment agreements for 2007.

<PAGE>

In August 2005, the Company issued  1,000,000  shares of common stock registered
under Form S-8 to  financial  consultants  and  charged an expense of $60,000 in
2005,  which  equaled the fair value of the stock on the date of the award.  The
Company also issued 500,000 shares of common stock  registered under Form S-8 to
its  President  and  majority  shareholder  and charged an expense of $30,000 in
2005, which equaled the fair value of the stock on the date of the award.

In April 2004, we acquired a collection of sports  memorabilia from our majority
shareholder and President.  We engaged a consultant to liquidate the collection.
The  consultant  was issued  250,627  shares of common stock valued at $100,250,
which was expensed.  This contract expired in March 2005, and the unsold portion
of the Collection was returned to the Company.  The Company continues to explore
its options  regarding  liquidation  of the  Collection.  In 2004, we issued the
consultant an option to acquire the entire collection for $200,000.  We recorded
the fair value of this option  ($204,000) as a charge to operations during 2004.
In 2005, this option expired and we recorded a gain of $204,000. We received net
proceeds of $5,000 from the sales of items from the collection in 2005.

We expect an  increase  in our 2007  legal  expenses  as the result of our legal
actions related to Eline Entertainment, Inc.

For 2006,  we maintained  the  valuation  allowance of our deferred tax asset at
100%. In 2005, we increased the valuation allowance on our deferred tax asset to
100% from 48%,  resulting  in an income tax expense of $225,000  for 2005.  This
increase was based primarily on net operating  losses realized in 2005 and 2004.
Our deferred tax asset is based on our net operating loss carryforward.

We  recognized  a net  loss  for 2006 of  $(101,000)  compared  to a net loss of
$(172,000) for 2005.

<PAGE>

We will continue to introduce new products that will increase  sales revenue and
implement  a strategy of creating or  acquiring  operational  affiliates  and/or
subsidiaries  that will use CD's in herbal medicines,  waste-water  remediation,
pharmaceuticals,  and foods.  We also intend to pursue  exclusive  relationships
with  major  CD  manufacturer(s)  and  specialty  CD  labs to  distribute  their
products. We continue to be the exclusive distributor in North America of the CD
products manufactured by Cyclolab Research Laboratories in Budapest, Hungary.

In keeping with its  commitment to use the internet as a major  advertising  and
public  relations  outlet,  we continue to maintain our web site. This asset has
been instrumental in creating and maintaining a worldwide leadership role for us
in the implementation of research and  commercialization of CD applications.  We
believe the  maintenance  and growth of our web site will return that investment
many times.

Forward-looking Statement

All  statements  other than  statements  of  historical  fact in this report are
"forward-looking  statements"  as defined in the Private  Securities  Litigation
Reform Act of 1995, and are based on  management's  current  expectations of the
Company's  near  term  results,  based  on  current  information  available  and
pertaining to the Company.  The Company assumes no obligation to update publicly
any forward-looking statements.  Actual results may differ materially from those
projected in the forward-looking  statements.  These forward-looking  statements
involve risks and uncertainties,  including,  but not limited to, the following:
demand  for   Cyclodextrins;   changes  in  governmental  laws  and  regulations
surrounding  various  matters,  such as  labeling  disclosures;  production  and
pricing  levels  of  important  raw  materials;  difficulties  of  delays in the
development,  production, testing and marketing of products; and product margins
and customer product acceptance.

<PAGE>

Item 7.  Financial Statements.

                        BAUMANN, RAYMONDO & COMPANY, P.A.
                         405 NORTH REO STREET, SUITE 200
                                 TAMPA, FL 33609

             Report of Independent Registered Public Accounting Firm

To the Board of Directors
CTD Holdings, Inc.
High Springs, Florida

We have  audited  the  consolidated  balance  sheet of CTD  Holdings,  Inc.  and
subsidiary as of December 31, 2006, and the related  consolidated  statements of
operations, stockholders' equity and cash flows for the years ended December 31,
2006  and  2005.  These  financial  statements  are  the  responsibility  of the
Company's  management.  Our  responsibility  is to  express  an opinion on these
financial statements based on our audits.

We conducted  our audit in accordance  with the standards of the Public  Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement.  An audit includes examining, on a
test basis,  evidence  supporting  the amounts and  disclosures in the financial
statements.  An audit also includes assessing the accounting principles used and
significant  estimates  made by  management,  as well as evaluating  the overall
financial  statement  presentation.   We  believe  that  our  audit  provided  a
reasonable basis for our opinion.

In our opinion, the consolidated  financial statements referred to above present
fairly, in all material respects,  the financial position of CTD Holdings,  Inc.
and subsidiary as of December 31, 2006, and the results of their  operations and
their cash flows for the years ended  December 31, 2006 and 2005,  in conformity
with U.S. generally accepted accounting principles.

\s\ Baumann, Raymondo & Company, P.A.

Baumann, Raymondo & Company PA
Tampa, Florida
February 12, 2007

<PAGE>


                               CTD HOLDINGS, INC.
                           CONSOLIDATED BALANCE SHEET
                                DECEMBER 31, 2006

                                     ASSETS

CURRENT ASSETS
 Cash and cash equivalents                              $     23,629
 Accounts receivable                                          59,109
 Inventory                                                    79,747
 Investment due from related party                           135,540
 Other current assets                                         24,113
                                                        -------------
     Total current assets                                    322,138
                                                        -------------
PROPERTY AND EQUIPMENT, NET                                  334,182
                                                        -------------
OTHER

 Loan to officer                                              16,514
 Intangibles, net of accumulated
   amortization of $3,800                                     10,267
 Idle property and equipment                                  77,361
                                                        -------------
     Total other assets                                      104,142
                                                        -------------
TOTAL ASSETS                                            $    760,462
                                                        =============

The accompanying notes to consolidated financial statements are an integral part
of this statement.

                                     F-2



<PAGE>

                               CTD HOLDINGS, INC.
                           CONSOLIDATED BALANCE SHEET
                                DECEMBER 31, 2006
                                   (Continued)


                      LIABILITIES AND STOCKHOLDERS' EQUITY


CURRENT LIABILITIES
 Accounts payable and accrued expenses                   $     52,166
 Current portion of long-term debt                              6,182
                                                         -------------
     Total current liabilities                                 58,348
                                                         -------------
LONG-TERM LIABILTIES
  Long-term debt, less current portion                        142,002
                                                         -------------


STOCKHOLDERS' EQUITY
 Common stock, par value $.0001 per share,
  100,000,000 shares authorized, 15,705,541 shares issued
  and outstanding                                               1,571
 Preferred stock, par value $.0001 per share,
  5,000,000 shares authorized; Series A, 1 share
  issued and outstanding                                            -
 Additional paid-in capital                                 2,881,262
 Accumulated deficit                                       (2,322,721)
                                                         -------------
     Total stockholders' equity                               560,112
                                                         -------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY               $    760,462
                                                         =============

The accompanying notes to consolidated financial statements are an integral part
of this statement.

                                     F-3



<PAGE>

                               CTD HOLDINGS, INC.
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                 FOR THE YEARS ENDED DECEMBER 31, 2006 AND 2005


                                                        2006        2005
                                                   -------------   ------------
PRODUCT SALES                                      $    542,313    $   454,360

COST OF PRODUCTS SOLD                                   125,188         66,657
                                                   -------------   ------------
GROSS PROFIT                                            417,125        387,703
                                                   -------------   ------------

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES
 Selling, general and administrative                    350,675        500,316
 Acquisition costs - Cyclolab                           112,353              -
                                                   -------------   ------------
         Total, selling, general and administrative     463,028        500,316
         Expenses                                  -------------   ------------

SPORTS MEMORABILIA COLLECTION
 Gain on sales                                                -          2,902
 Other income (expense)                                 (50,402)       161,470
                                                   -------------   ------------
                                                        (50,402)       164,372
                                                   -------------   ------------

OTHER INCOME (EXPENSE)
 Investment and other income                             19,365         14,736
 Interest expense                                       (11,049)       (13,956)
 Loss on disposal of equipment                          (13,836)
                                                    -------------   -----------
     Total other income (expense)                        (5,520)           780
                                                   -------------   ------------
NET INCOME (LOSS) BEFORE INCOME TAXES                  (101,825)        52,539

INCOME TAXES                                                  -       (225,000)
                                                   -------------   ------------
NET INCOME (LOSS)                                  $   (101,825)   $  (172,461)
                                                   =============   ============

NET INCOME (LOSS) COMMON SHARE:                    $      (.007)   $     (.014)
                                                   =============   ============

 Weighted average number of
  common shares outstanding                          14,815,279     12,017,790
                                                   =============   ============



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

                                     F-4

<PAGE>
<TABLE>


                               CTD HOLDINGS, INC.
                 CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
                 FOR THE YEARS ENDED DECEMBER 31, 2006 AND 2005

                                     COMMON STOCK        PREFERRED STOCK    ADDITIONAL                     TOTAL
                                                                             PAID-IN      ACCUMULATED   STOCKHOLDERS'
                                  SHARES     PAR VALUE  SHARES  PAR VALUE    CAPITAL        DEFICIT        EQUITY
                               ------------  ---------  ------  ---------  -----------  -------------  -------------
<S>                                     <C>        <C>     <C>        <C>          <C>            <C>            <C>
Balance, December 31, 2004      10,956,517   $   1,096       1  $       -  $ 2,615,288  $ (2,048,435)  $    567,949

Employment agreements            1,943,151         194       -          -      122,110             -        122,304

Shares issued for services       1,000,000         100       -          -       59,900             -         60,000

Net loss                                 -           -       -          -            -      (172,461)      (172,461)
                               ------------  ----------  ------  --------  -----------  -------------  -------------
Balance,
December 31, 2005               13,899,668       1,390       1          -    2,797,298    (2,220,896)       577,792

Shares issued under
employment agreements            1,791,873         179       -          -       83,406             -         83,585

Shares issued for services          14,000           2       -          -          558             -            560

Net loss                                 -           -       -          -            -      (101,825)      (101,825)

Balance,                       ------------  ----------  ------  --------  -----------  -------------  -------------
December 31, 2006               15,705,541   $   1,571       1   $      -  $ 2,881,262  $ (2,322,721)  $   (560,112)
                               ============  ==========  ======  ========  ===========  =============  =============

</TABLE>

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

                                      F-5


<PAGE>

                               CTD HOLDINGS, INC.
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                Increase (Decrease) in Cash and Cash Equivalents
                           DECEMBER 31, 2006 AND 2005


                                                            2006          2005
                                                        -----------  -----------
CASH FLOWS FROM OPERATING ACTIVITIES
 Net income (loss)                                      $ (101,825)  $ (172,461)
                                                        -----------  -----------
 Adjustments to reconcile net income to net
  cash provided by (used in) operating
  activities:
   Depreciation and amortization                            27,463       35,011
   Gain on sale of sports memorabilia collection                 -       (2,902)
   Loss on disposal of equipment                            13,836            -
   Deferred income taxes                                         -      225,000
   Impairment adjustment-sports memorabilia coll.           50,402       42,000
   Stock issued for services                                     -       60,000
   Expiration of call option-sports memorabilia coll.            -     (203,470)
   Stock compensation to employees                          84,145      122,304
Increase or decrease in:
   Accounts receivable                                     (22,707)      22,620
   Inventory                                               (25,162)      (3,586)
   Prepaid expenses                                        (24,113)           -
   Accounts payable and accrued expenses                    24,075        4,251
                                                        -----------  -----------
        Total adjustments                                  127,939      301,228
                                                        -----------  -----------
    Net cash provided by (used in)operating
    activities                                              26,114      128,767
                                                        -----------  -----------
CASH FLOWS FROM INVESTING ACTIVITIES
 Proceeds from sale of sports memorabilia coll.                  -        4,545
 Purchase of property and equipment                        (27,628)     (22,576)
 Purchase of certificate of deposit                              -      (91,048)
 Redemption of certificate of deposit                      131,381            -
 Loan costs incurred                                             -       (3,872)
 Investment with related party                            (110,540)     (25,000)
                                                        -----------  -----------
    Net cash provided by (used in) investing
    activities                                              (6,787)    (137,951)

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

CASH FLOWS FROM FINANCING ACTIVITIES

  Payments on long-term debt                                (6,743)      (6,114)
  Payment on loan payable to stockholder                    (3,467)     (50,131)
  Loan to shareholder                                      (16,514)           -
  Received from shareholder                                      -        2,084
                                                        -----------  -----------
    Net cash used in financing activities                  (26,724)     (54,161)
                                                        -----------  -----------
Net increase (decrease) in cash and cash equivalents        (7,397)     (63,345)

CASH AND CASH EQUIVALENTS, beginning of period              31,026       94,371
                                                        -----------  -----------
CASH AND CASH EQUIVALENTS, end of period                $   23,629   $   31,026
                                                        ===========  ===========

                                       F-6


<PAGE>

                               CTD HOLDINGS, INC.
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                Increase (Decrease) in Cash and Cash Equivalents
                           DECEMBER 31, 2006 AND 2005
                                   (Continued)

                                                         2006         2005
                                                     ------------  ------------

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash paid for interest                               $     11,049  $     13,686
                                                     ============  ============
Cash paid for income taxes                           $          -  $          -
                                                     ============  ============
SUPPLEMENTAL DISCLOSURE OF NONCASH INVESTING AND
 FINANCING ACTIVITY

  Common stock issued for services                   $     84,145  $    182,304
                                                     ============  ============

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


<PAGE>


                               CTD HOLDINGS, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           DECEMBER 31, 2006 AND 2005

(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

The following is a summary of the more  significant  accounting  policies of CTD
Holdings,  Inc.  and  Subsidiary  (the  Company)  that  affect the  accompanying
consolidated financial statements:

     (a)  ORGANIZATION  AND OPERATIONS - The Company was  incorporated in August
1990,  as a Florida  corporation  with  operations  beginning in July 1992.  The
Company  is engaged  in the  marketing  and sale of  cyclodextrins  and  related
products to food, pharmaceutical and other industries. The Company also provides
consulting services related to cyclodextrin technology.

     (b) BASIS OF PRESENTATION - The consolidated  financial  statements include
the Company and its wholly  owned  subsidiary.  All  intercompany  accounts  and
transactions have been eliminated.

     (c) CASH AND CASH  EQUIVALENTS - For the purposes of reporting  cash flows,
the Company considers all highly liquid investments with an original maturity of
three months or less to be cash equivalents.

     (d)  ACCOUNTS  RECEIVABLE  - Accounts  receivable  are stated at the amount
management expects to collect from outstanding  balances.  Based on management's
assessment of the credit history with customers having outstanding  balances and
current  relationships  with them, it has concluded that  realization  losses on
balances outstanding at year-end will be immaterial.

     (e) PROPERTY AND  EQUIPMENT - Property and  equipment are recorded at cost.
Depreciation   on  property  and  equipment  is  computed  using  primarily  the
straight-line  method over the estimated useful lives of the assets, which range
from three to forty years. In accordance with Statement of Financial  Accounting
Standards No. 121  "Accounting  for the Impairment of Long-Lived  Assets and for
Long-Lived  Assets to be  Disposed  Of," the  Company  periodically  reviews its
long-lived  assets to  determine  if the  carrying  value of  assets  may not be
recoverable.  If an impairment is identified,  the Company recognizes a loss for
the difference between the carrying amount and the estimated value of the asset.

     (f) INVENTORY - Inventory  consists of cyclodextrin  products purchased for
resale  and  chemical  complexes.  Inventory  is  recorded  at the lower of cost
(first-in, first-out) or market.

<PAGE>

     (g)  INTANGIBLES  -  Intangible  assets  consist  of loan  costs  and other
intangibles  recorded at cost.  Intangible are amortized using the straight-line
method over their respective estimated useful lives.

     (h) SPORTS  MEMORALBILIA  COLLECTION  - The sports  memorabilia  collection
(Collection) was acquired from the Company's President and majority  shareholder
in 2004 in  exchange  for  common  stock  of the  Company  (see  Note  13).  The
Collection  consists  principally of baseball cards, but also includes a variety
of other collectible sport memorabilia.  The Collection was recorded at the cost
basis of the  President  and  majority  shareholder,  which  was  less  than the
estimated  fair value.  The Company  records gains as the Collection is sold and
cash is received,  net of expenses.  The cost of the  Collection  is expensed at
26.5%  of  gross  proceeds  from  the sale of the  Collection.  The  26.5%  cost
allocation  is based  on the  recorded  cost of the  Collection  divided  by the
estimated fair value of the  Collection.  The Company  periodically  reviews the
fair value of the Collection for impairment.

     (i)  REVENUE  RECOGNITION  - Revenues  are  recognized  when  products  are
shipped.

     (j)  ADVERTISING  -  Advertising  costs  are  charged  to  operations  when
incurred.

     (k) START-UP COSTS - Start-up costs are expensed as incurred.

     (l) NET INCOME (LOSS) PER COMMON SHARE - Net income (loss) per common share
is computed in  accordance  with the  requirements  of  Statement  of  Financial
Accounting Standards No. 128 (SFAS 128). SFAS 128 requires net income (loss) per
share  information  to be  computed  using a simple  weighted  average of common
shares  outstanding  during  the  periods  presented.  For stock  awarded  under
employment  agreements  (see Note 2), the  monthly  stock  awarded is treated as
issued on the 15th day of each  month  earned  for  purposes  of  computing  the
weighted average outstanding shares.

     (m) STOCK BASED  COMPENSATION  - The Company  follows the  requirements  of
Statement of Financial Accounting Standard No. 123(R) "Share-Based Payment." The
Company  has  employment  agreements  which  call  for  stock to be  awarded  to
employees each month. The Company  recognizes an expense equal to the fair value
of the stock  determined  using the average stock closing  trading price for the
month  multiplied by number of shares  awarded for that month.  The Company also
issues periodic stock bonuses to employees. The Company records an expense equal
to the fair value of the stock on the closing  trading price of the stock on the
day awarded.

<PAGE>

     (n)  RECLASSIFICATIONS  - Certain amounts in the 2005 financial  statements
have  been  reclassified  for  comparative  purposes  to  conform  with the 2006
presentation.

     (o) NEW  ACCOUNTING  PRONOUNCEMENTS  - The Financial  Accounting  Standards
Board ("FASB") has issued several new standards, which have implementation dates
subsequent to the Company's  year end.  Management  does not believe that any of
these new  standards  will have a  material  impact on the  Company's  financial
position, results of operations or cash flows.

     (p) USE OF ESTIMATES - The preparation of consolidated financial statements
in conformity with accounting principles generally accepted in the United States
of America  requires  management to make estimates and  assumptions  that affect
certain  reported  amounts and  disclosures.  Accordingly,  actual results could
differ from those estimates.

(2) COMMITMENTS AND CONTINGENCIES

In August 2005, the Company issued  1,000,000  shares of common stock registered
under  Form S-8 to  financial  consultants  and  charged  an expense in 2005 for
$60,000, which equaled the fair value of the stock on the date of the award. The
Company also issued 500,000 shares of common stock  registered under Form S-8 to
its President and majority  shareholder and charged expense in 2005 for $30,000,
which equaled the fair value of the stock on the date of the award.

For 2006,  the Company has  employment  agreements  with two  officers for total
monthly  salaries of $4,900.  In addition,  the  officers are awarded  shares of
common stock each month.  The number of shares due is equal to $6,000 divided by
eighty  percent of the closing price of the  Company's  common stock on the last
day of each month. The Company  recognizes an expense equal to the fair value of
the stock determined using the average stock closing trading price for the month
multiplied by number of shares  awarded for that month.  The stock is subject to
trading  restrictions  under Rule 144. For 2006, the Company  awarded  1,791,873
shares  and  recognized  an expense of $83,585  for stock  awarded  under  these
agreements.  For 2005, the Company  awarded  1,943,152  shares and recognized an
expense of $122,304 for stock awarded under these  agreements.  Both  agreements
have been extended  through  December 31, 2007.  The Company also awarded 14,000
shares of stock to its employees and recorded and expense of $560.

     On  February  7, 2007,  Registrant  and C.E.  Rick  Strattan  filed suit in
Circuit Court in Palm Beach County,  Florida,  (Case Number  2007CA001818XXXXMB)
seeking the return of the Class A Preferred  Share and damages  from  defendants
Eline  Entertainment  Group,  Inc., Eline Holding Group,  Inc.,  Yucatan Holding
Company,  Steven  T.  Dorrough,  Jayme  Dorrough,  and Barry  Rothman,  based on
representations  made in  connection  with the Share  Exchange  Agreement  dated
August 11, 2005, as amended and the enforcement of the agreement.

<PAGE>

(3) PROPERTY AND EQUIPMENT

Property and equipment as of December 31, 2006, consists of:

         Land                                          $    80,000
         Buildings and improvements                        241,312
         Machinery and equipment                            20,230
         Office furniture and equipment                     58,961
                                                       ------------
                                                           400,503

         Less: accumulated depreciation                     83,769
                                                       ------------
                                                           316,734

         Construction in progress                           17,448
                                                       ------------

         Property and equipment, net                   $   334,182
                                                       ============

The  carrying  value of remaining  idle  long-lived  assets  related to a former
mushroom farming operation was $77,361 at December 31, 2006.

(4) CONCENTRATIONS OF CREDIT RISK:

Significant concentrations of credit risk for all financial instruments owned by
the Company, are as follows:

     (a)  DEMAND  AND  CERTIFICATE  OF  DEPOSITS  - The  Company  has demand and
certificate  of  deposits  in  financial  institutions  that are  insured by the
Federal Deposit Insurance  Corporation up to $100,000. At December 31, 2006, the
demand and  certificate  deposit bank  balance was  $24,000.  The Company has no
policy of requiring collateral or other security to support its deposits.

     (b) ACCOUNTS  RECEIVABLE - The  Company's  accounts  receivable  consist of
amounts due primarily from food and  pharmaceutical  companies located primarily
in the United States and the United Kingdom.  Two customers accounted for 77% of
the accounts  receivable balance at December 31, 2006. The Company has no policy
requiring collateral or other security to support its accounts receivable.

     (c)  INVESTMENT  WITH RELATED PARTY - The Company has an oral agreement for
investment  services with a nonprofit  organization.  The Company's president is
also the president of the nonprofit organization.  The funds are invested by the
nonprofit in a money market account.  The Company earns a proportional  share of
the  interest  earned in the  account.  The Company  has no policy of  requiring
collateral or other security to support this amount.

                                     F-8


<PAGE>


                               CTD HOLDINGS, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           DECEMBER 31, 2006 AND 2005

(5) MAJOR CUSTOMERS AND SUPPLIERS:

In 2006, three major customers  accounted for  approximately 49% of total sales.
In 2005, three major customers accounted for approximately 58% of total sales.

Substantially   all  2006   inventory   purchases   were  from  three   vendors.
Substantially all 2005 inventory purchases were from two vendors.

The Company has only one source for certain  manufacturing  inventory.  However,
the Company has  manufactured  these products in the past and could do so again,
if necessary. There are multiple sources for its other inventory products.

(6) LONG-TERM DEBT:

Long-term debt consists of the following as of December 31, 2006:

         Mortgage note payable to bank, payments of $1,163
          due monthly including principal and interest
          at 7.25%, collateralized by land and buildings
          with a cost of $210,000                                   $  143,764



         Note payable to financing company, payments of
          $288 due monthly, including principal and interest,
          at 6%, collateralized by vehicle with a cost
          of $14,881                                                     4,420
                                                                    -----------

         Total long-term debt                                          148,184

         Less current portion                                           (6,182)
                                                                    -----------
   Long-term debt, less current portion                             $  142,002
                                                                    ===========

<PAGE>

Maturities  on  long-term  debt as of December 31, 2006 over the next five years
and thereafter are as follows:

         Year ending
         December 31,                                  Amount
         ------------                                ---------
             2007                                    $   6,182
             2008                                        5,362
             2009                                        4,238
             2010                                        4,556
             2011                                        4,897
             2012 and thereafter                       122,949
                                                     ---------
                                                     $ 148,184
                                                     =========


(7) RELATED PARTY TRANSACTIONS:

The  President  (who is also the majority  common  stockholder)  had  previously
provided loans to the Company.  The Company paid the loan off in full during the
year ended  December 31, 2006.  The loan was unsecured  and interest  accrued at
4.17%. Interest expense related to the loan totaled $43 and $1,301 for the years
ended December 31, 2006 and 2005, respectively.

During  2006,  the  President  (who is also  the  majority  common  stockholder)
borrowed  $16,514.  The loan is unsecured and interest  accrues at 5%. This loan
was a prohibited transaction under Section 402 of the Sarbanes-Oxley Act and was
repaid on February 2, 2007.

(8) FAIR VALUE OF FINANCIAL INSTRUMENTS:

Statement of Financial  Accounting  Standards  No. 107  "Disclosures  about Fair
Value of Financial  Instruments" requires disclosure of fair value to the extent
practicable for financial  instruments,  which are recognized or unrecognized in
the  consolidated  balance  sheet.  The fair value of all financial  instruments
approximates  carrying value due to the short-term  maturity of the instruments.
The fair value of the financial instruments is not necessarily representative of
the amount that could be realized  or  settled,  nor does the fair value  amount
consider the tax consequences of realization or settlement.

<PAGE>

(9) INCOME TAXES:

The Company follows the provisions of Statement of Financial Accounting Standard
No. 109 "Accounting for Income Taxes."  Differences between accounting rules and
tax laws cause  differences  between the basis of certain assets and liabilities
for  financial  reporting  purposes  and tax  purposes.  The tax effect of these
differences,  to the extent they are  temporary,  is  recorded  as deferred  tax
assets and liabilities.  Income tax expense is the tax payable or refundable for
the period  plus or minus the change  during the period in  deferred  assets and
liabilities.  Temporary  differences  which give rise to deferred tax assets and
liabilities   consist  of  net   operating   loss   carryforwards,   accelerated
depreciation  methods for income tax purposes  and  interest  accrued to related
parties but not for tax purposes until paid.

The  Company  has  available  at  December  31,  2006,   unused  operating  loss
carryforwards  totaling  approximately  $ 1,647,000 that may be applied  against
future taxable income. If not used, the carryforwards will expire as follows:

         Year Ending
         December 31,                              Amount
         ------------                           -----------

             2009                               $   760,000
             2010                                   195,000
             2017                                   206,000
             2020                                   280,000
             2021                                    71,000
             2024                                    66,000
             2025                                    37,000
             2026                                    32,000
                                                -----------
             Total                              $ 1,647,000
                                                ===========

<PAGE>

If all of the operating loss carryforwards and temporary deductible  differences
were used,  the  Company  would  realize a deferred  tax asset of  approximately
$515,000  based upon  expected  income tax rates.  Under  Statement of Financial
Accounting  Standards No. 109,  "Accounting for Income Taxes",  the deferred tax
asset  should be reduced by a valuation  allowance if it is likely that all or a
portion of it will not be realized. Realization depends on generating sufficient
taxable income before the expiration of the loss carryforwards.

At December 31, 2002,  management determined that a 100% valuation allowance was
appropriate.  For 2003 and 2002,  the Company  realized  net income and utilized
approximately  $240,000 of its net  operating  loss  carryforward  to offset its
current income tax liabilities.  In 2003, Management determined that a reduction
in the  valuation  allowance  to 43% from 100% of the  future  tax  benefit  was
appropriate,  which resulted in the recognition of a $225,000 deferred tax asset
and a income tax benefit. In 2004,  Management  increased it valuation allowance
percentage  to 48%  resulting  in no income tax expense or benefit for change in
its deferred tax asset. At December 31, 2005, Management increased the valuation
allowance to 100% due primarily to net losses  realized for 2004 and 2005.  This
resulted  in income  tax  expense of  $225,000  for 2005.  For 2006,  management
continues to provide a 100% valuation allowance on its deferred tax asset.

Because of the inherent  uncertainties in estimating the valuation  allowance on
the deferred tax asset,  it is at least  reasonably  possible that the company's
estimate  deferred tax asset will change in the near term and be material to the
financial statements.

                                                 2006          2005
                                             -----------   -----------
Current income tax benefit (expense)         $    7,000    $   (7,000)

Tax benefit (expense) of temporary               13,000       (14,000)
differences

Tax benefit of operating loss carryforwards           -         7,000

Decrease (increase) in valuation allowance      (20,000)     (211,000)

                                             -----------   -----------
Total net tax benefit (expense)               $       -    $  225,000
                                             ===========   ===========

<PAGE>

(10) ACQUISITIONS OF SPORTS MEMORABILIA COLLECTION

In April 2004, the Company  finalized the  acquisition  of a sports  memorabilia
collection  (Collection),  from it President and major shareholder.  The Company
recorded the Collection at $106,000,  which is the acquisition cost basis of the
President and controlling shareholder.

Concurrent with the  acquisition of the  Collection,  the Company entered into a
one-year contract with a consultant to liquidate the Collection which expired in
March 2005.  The  Company  continues  to explore  its  options to  continue  its
liquidation of the collection.

In 2005, Management determined the sports memorabilia  collection to be impaired
due to lack of marketability and recorded an impairment charge of $42,000.

The  consultant has the option to purchase the Collection at any time during the
term of the agreement  for $200,000  less any sale proceeds  already paid to the
Company.  The  Company  computed  the fair value of this call  option  using the
Black-Scholes stock option pricing model. The following assumptions were made in
estimating  fair value:  risk-free  interest  rate of 3.5%;  no dividend  yield;
expected life of one year. The fair value calculated resulting from the issuance
of this option was  determined  to be $203,470 at December  31,  2004,  which is
recorded as a liability in the accompanying balance sheet and charged operations
in the accompanying  statement of operations.  The Company recalculates the fair
value of the option at the end of each reporting period and recognize any change
as through operations and adjust its liability accordingly.

The  consultant had the option to purchase the Collection at any time during the
term of the agreement  for $200,000  less any sale proceeds  already paid to the
Company.  The  Company  computed  the fair value of this call  option  using the
Black-Scholes  stock option pricing model.  The far value  calculated  resulting
from the issuance of this option was recorded as a liability and the expense was
charged  to  operations.  The  option  expired in March  2005,  and the  Company
recorded the  expiration of the option  liability as a gain in the  accompanying
statement of operations for the year end December 31, 2005.

<PAGE>

(11) CORPORATE CHANGES

The Company amended its Articles of Incorporation  authorizing a class of "blank
check"  preferred stock consisting of 5,000,000 shares thus creating a series of
Series A Preferred Stock and set forth its designations, rights and preferences.
The more significant right is the Series A share votes together with the holders
of the common  stock on all matters  submitted  to a vote of Company  holders of
common stock,  with the share of Series A Preferred  Stock being entitled to one
vote more than  one-half  of all votes  entitled  to be cast by all  holders  of
voting  capital  stock  of  the  Company  on  any  matter  submitted  to  common
shareholders so as to ensure that the votes entitled to be cast by the holder of
the Series A  Preferred  Stock are equal to at least a majority  of the total of
all votes entitled to be cast by the common shareholders. Each share of Series A
Preferred  Stock has a  liquidation  preference of $.0001.  In 2004,the  Company
issued  one  share  of the  Series A  Preferred  Stock  to its  majority  common
shareholder  in  exchange  for  1,029,412  shares  of common  stock  held by the
majority  common  shareholder,   which  were  surrendered  to  the  Company  and
cancelled.  Effective  August 11, 2005, the  outstanding  share of the Company's
Series A Preferred  Stock was  acquired by Eline  Entertainment  Group,  Inc. In
September 2006, the Company's majority common shareholder  demanded the transfer
to him of the one share of Series A  preferred  stock in  exchange  for  100,000
shares of Eline Entertainment Group, Inc. alleging breach of contract. The share
certificate of Series A Preferred Stock is in the possession of the Registrant.

(12)  SIGNIFICANT FOURTH QUARTER ADJUSTMENTS

Management  determined the sports  memorabilia  collection to be impaired due to
lack of marketability and recorded an impairment charge of $50,402 in the fourth
quarter of 2006.

                                      F-12


<PAGE>

Item 8.  Changes  In  and  Disagreements  With  Accountants  on  Accounting  and
         Financial Disclosure.

On July 19, 2005, the Company engaged Baumann,  Raymondo & Company,  P.A. as its
independent  auditors for the year ending December 31, 2005, to replace the firm
of James Moore & Co., P.L.  which was dismissed as its auditors  effective  July
19, 2005. The decision to change auditors was approved by the Company's Board of
Directors.

The reports of James Moore & Co. on the financial  statements of the Company for
the years ended  December  31,  2003,  and  December 31, 2004 did not contain an
adverse opinion or a disclaimer of opinion and were not qualified or modified as
to uncertainty, audit scope or accounting principles.

There were no disagreements  with James Moore & Co., P.L., which  disagreements,
if not  resolved  to the  satisfaction  of James Moore & Co.,  P.L.,  would have
caused it to make  reference to the subject  matter of the  disagreement  in the
report,  on  any  matters  of  accounting  principles  or  practices,  financial
statement  disclosure or auditing  scope and  procedures in connection  with the
audits of the  Company's  consolidated  financial  statements  for the  two-year
period  ended  December 31, 2004,  or with regard to the  Company's  most recent
10-QSB filed May 13, 2005.


Item 8A.  Controls and Procedures.

(a) Evaluation of disclosure controls and procedures.

The Company's  management,  recognizes its  responsibility  for establishing and
maintaining  internal  control over financial  reporting for the Company.  After
evaluating the  effectiveness  of our  "disclosure  controls and procedures" (as
defined in the Securities Exchange Act of 1934 Rules 13a-15(e) and 15d-15(e)) as
of December 31, 2005 (the  "Evaluation  Date"),  the  Company's  management  has
concluded,  as of the  Evaluation  Date, the Company's  disclosure  controls and
procedures were adequate and designed to ensure the  information  required to be
disclosed in the reports filed or submitted by us under the Securities  Exchange
Act of  1934  is  recorded,  processed,  summarized  and  reported  with  in the
requisite time periods.  Although the Company's existing disclosure controls and
procedures  are  adequate,  the  Company's  management  acknowledges  a material
weakness may exist in those  controls and  procedures in that i) the  accountant
employed  by the  Company has no training  regarding  financial
reporting  and  presentation  rules  and  regulations  of the  SEC;  and ii) the
Company's President/CEO, who oversees all the accountants' work and provides all
internal  control  functions,  while  possessing  a MBA from the  University  of
Florida,  has no  training in matters of  accounting,  financial  reporting,  or
presentation rules and regulations of the SEC.

<PAGE>

(b) Effectiveness of Internal Control

The  Company's  management is reviewing  the  Company's  internal  controls over
financial reporting to determine the most suitable recognized control framework.
The  Company  will  give  great  weight  and  deference  to the  product  of the
discussions  of the SEC's Advisory  Committee on Smaller  Public  Companies (the
"Advisory Committee") and the Committee of Sponsoring  Organizations' task force
entitled  Implementing  the COSO Control  Framework in Smaller  Businesses  (the
"Task  Force").  Both the Advisory  Committee and the Task Force are expected to
provide practical, needed guidance regarding the applicability of Section 404 of
the  Sarbanes-Oxley  Act to small  business  issuers.  The Company's  management
intends to perform the evaluation  required by Section 404 of the Sarbanes-Oxley
Act at such time as a framework is adopted by the Company.  For the same reason,
the Company's registered  accounting firm has not issued an "attestation report"
on the Company  management's  assessment  of  internal  controls.  Although  the
Company's  existing  disclosure  controls  and  procedures  are  adequate,   the
Company's  management  acknowledges  a  material  weakness  may  exist  in those
controls and procedures in that i) the accountant employed by the Company has no
training regarding financial reporting and presentation rules and regulations of
the SEC; and ii) the Company's President/CEO,  who oversees all the accountants'
work and provides all internal  control  functions,  while possessing a MBA from
the University of Florida,  has no training in matters of accounting,  financial
reporting, or presentation rules and regulations of the SEC.

(c) Changes in internal controls.

After  evaluation by the Company's  management,  the  Company's  management  has
determined there were no significant  changes in the Company's internal controls
or in other  factors  that could  significantly  affect the  Company's  internal
controls subsequent to the Evaluation Date.

Item 8B.  Other Information.

None.
<PAGE>
PART III.

Item 9. Directors,  Executive Officers, Promoters, Control Persons and Corporate
        Governance; Compliance With Section 16(a) of the Exchange Act.

Two (2) directors,  constituting the entire Board of Directors,  serve until the
next Annual Meeting of  shareholders,  or until a successor shall be elected and
shall qualify:

Name                   Age        Principal Occupation         Year First Became
                                                                      Director

C.E. Rick Strattan      59        President, CEO and Chairman             1990

George L. Fails         60        Operations Manager                      2001

C.E. Rick Strattan,  President,  CEO and Director  since its 1990. Mr.  Strattan
served as  treasurer  of the Company  from  August,  1990,  to May,  1995.  From
November 1987 through July 1992, Mr. Strattan was with Pharmatec, Inc., where he
served as Director of Marketing and Business  Development  for CDs. Mr. Strattan
was  responsible for CD sales and related  business  development  efforts.  From
November, 1985 through May, 1987, Mr. Strattan served as Chief Technical Officer
for Boots-Celltech Diagnostics, Inc. He also served as Product Sales Manager for
American  Bio-Science  Laboratories,  a Division  of  American  Hospital  Supply
Corporation. Mr. Strattan is a graduate of the University of Florida receiving a
B.S. degree in chemistry and mathematics,  and has also received an MS degree in
Pharmacology, and an MBA degree in Marketing/Computer Information Sciences, from
the same institution.  Mr. Strattan has written and published  numerous articles
and a book chapter on the subject of Cyclodextrins.

George L. Fails,  Operations  Manager CTD, Inc. since 2000. Mr. Fails  currently
serves as  Operations  Manager for CTD, Inc.  Prior to joining the Company,  Mr.
Fails served as a Detective Sergeant with the Veterans  Administration  Hospital
in Gainesville,  Florida,  with special duties as a Predator Officer with the US
Marshall's  Service.  From 1965 until his  retirement in 1986,  Mr. Fails served
with the US Army Special Forces,  including several tours in Vietnam,  Salvador,
and Angola.  Mr. Fails also served two years with a United  States  intelligence
arm. Mr. Fails received his BA from the University of the  Philippines,  and has
also received  degrees from 43 Military  schools,  as well as the Federal police
Academy in Little Rock, Arkansas.

<PAGE>

Directors,  including directors also serving the Company in another capacity and
receiving separate compensation  therefor shall be entitled  to receive from the
Company  as  compensation  for  their  services  as  directors  such  reasonable
compensation  as the board may from time to time  determine,  and shall  also be
entitled to  reimbursements  for any reasonable  expenses  incurred in attending
meetings  of  directors.  To  date,  the  Board of  Directors  has  received  no
compensation, and no attendance fees have been paid.

Audit Committee Financial Expert

No one  on our  Board  of  Directors  can be  deemed  to be an  audit  committee
financial  expert.  Our business model is not complex and our accounting  issues
are straightforward. Responsibility for our operations is centralized within our
executive  management,  which is  comprised of two  persons.  We recognize  that
having  a person  who  possesses  all of the  attributes  of an audit  committee
financial  expert  would be a  valuable  addition  to our  Board  of  Directors,
however,  we are not, at this time, able to compensate such a person  therefore,
we may find it difficult to attract such a candidate.

Code of Ethics

We have  adopted  a code of  ethics  that  applies  to our  principal  executive
officer,   principal   financial  officer,   principal   accounting  officer  or
controller,  or persons performing similar functions. Our code of ethics will be
provided  to any  person  without  charge,  upon  request.  Requests  should  be
addressed to Investor Relations Department,  c/o CTD Holdings,  Inc., 27317 N.W.
78th Avenue, High Springs, Florida 32643.

<PAGE>

Item 10. Executive Compensation.

<TABLE>

                           SUMMARY COMPENSATION TABLE

                                                                                          Long-term compensation
                                                                          ........................................................
                                         Annual compensation                         Awards               Payouts
                                 --------------------------------------   ----------------------------    ---------
<S>                       <C>        <C>         <C>           <C>            <C>              <C>           <C>         <C>
                                                                                         Securities
                                                        Other annual    Restricted       underlying      LTIP       All other
Name & principal         Year     Salary      Bonus     compensation   stock awards     options/SARs    payouts   compensation
                                    ($)        ($)          ($)            ($)               (#)          ($)          ($)
===================    ========  ========  ===========  ============  ==============     ============   =======   ============

C.E. Rick Strattan       2006    $ 36,000        -0-        -0-       $ 60,000.00 (6)        -0-          -0-          -0-
President, CEO           2005    $ 36,000  $ 30,000 (5)     -0-       $ 76,290.00 (1)        -0-          -0-          -0-
Chairman                 2004    $ 36,000        -0-        -0-       $ 90,833.33 (2)        -0-          -0-          -0-


George L. Fails          2006    $ 22,800        -0-        -0-       $ 12,000.00 (7)        -0-          -0-          -0-
Operations Manager       2005    $ 16,478        -0-        -0-       $ 15,384.00 (3)        -0-          -0-          -0-
                         2004    $ 22,800        -0-        -0-       $ 18,166.67 (4)        -0-          -0-          -0-

   (1) Reflects grant of 1,202,626 shares
   (2) Reflects grant of 809,611 shares
   (3) Reflects grant of 240,525 shares
   (4) Reflects grant of 161,922 shares
   (5) Reflects grant of 500,000 shares
   (6) Reflects grant of 1,493,229 shares
   (7) Reflects grant of 298,644 shares

</TABLE>

     On October  14,  2003,  the  Company  entered  into a  one-year  Employment
Agreement  with C.E.  Rick  Strattan,  the Company's  president,  with an annual
salary of  $36,000  and  $5,000  per month in  restricted  common  shares of the
Company based on the closing  value of the  Company's  shares on the last day of
the month in which the shares are  awarded.  The  Company has agreed to register
Mr. Strattan's shares awarded pursuant to his employment contract. This contract
was extended through December 31, 2007.

<PAGE>

     Effective  January 1, 2004, the Company entered into a one-year  Employment
Agreement  with George L. Fails to serve as  Operations  Manager.  Mr.  Fails is
compensated $1,900 monthly, plus $1,000 per month in restricted common shares of
the Company,  based on the closing value of the Company's shares on the last day
of the month in which the shares are awarded. This contract was extended through
December 31, 2007.


Item 11.  Security  Ownership of Certain  Beneficial  Owners and  Management and
          Related Stockholder Matters.

     The following  table shows the ownership of the Common Stock of the Company
on March 22,  2007, by each person who, to the knowledge of the Company,  owned
beneficially  more than five percent  (5%) of such stock,  the ownership of each
director,  and the ownership of all  directors  and officers as a group.  Unless
otherwise  noted,  shares are subject to the sole voting and investment power of
the indicated person.

Names and Address of Individual             Amount and Nature of   Approximate %
or Identity of Group                        Beneficial Ownership     of Class

C.E. Rick Strattan   .......................   4,441,466              33.88%
4123 N.W. 46th Avenue
Gainesville, FL 32606

George L. Fails.............................     741,091               5.65%
2420 N.W. 142nd Avenue
Gainesville, FL 32609

Aspatuck Holdings, Inc. ....................   2,750,000              20.98%

All Officers and Directors as a group ......   3,890,684              66.84%

Kiaran Nicole Brooks  ......................     830,000               6.33%
4123 N.W. 46th Avenue
Gainesville, FL  32606

<PAGE>

                          Equity Compensation Plan Information
<TABLE>
<S>                        <C>                     <C>                        <C>
                            Number of                                          Number of
                            securities to be                                   securities remaining
                            issued upon exer-                                  available for future
                            cise of outstand-       Weighted-average           issuance under equity
                            ing options,            exercise price of          compensation plans
                            warrants, and           outstanding options,       (excluding securities
Plan category               and rights              warrants and rights        reflected in column (a))
                                  (a)                      (b)                         (c)
--------------------       -------------------      --------------------       ------------------------

Equity compensation
plans approved by              None                   Not Applicable             Not Applicable
security holders

Equity compensation
plans not approved          * * * * * * * * * * * See Note 1 to Table (below) * * * * * * * * * * *
by security holders
                          --------------------      --------------------       ------------------------
Total
                          ====================      ====================       ========================
</TABLE>

Notes to Equity Compensation Plan Table:

Note 1 -- The Company has employment agreements terminating on December 31, 2007
with two employees.  These  agreements  require the Company to compensate  these
employees,  collectively,  with $6,000 per month in restricted  common shares of
the Company based on the closing  value of the Company's  shares on the last day
of the month in which the shares are awarded


Item 12.  Certain   Relationships   and  Related   Transactions,   and  Director
          Independence.

     Mr. Strattan  periodically advances the Company short-term loans and defers
receipt of salary. The Company owes the stockholder $3,467 at December 31, 2005.
The loan is unsecured and interest  accrues at 5%.  Interest  expense related to
the loan  totaled  $1,301 and $3,031 for the years ended  December  31, 2005 and
2004, respectively.
<PAGE>

Item 13.  Exhibits.

    Exhibits                                                                Page

    (2) Plan of purchase, sale, reorganization, arrangement,
        liquidation, or succession

    (3) Articles of incorporation and by-laws

       (i)   Articles of Incorporation filed August 9, 1990 *               None

       (ii)  By-Laws. *                                                     None

       (iii) Certificates of Amendment to the Articles of
              Incorporation  filed November 18, 1993 and
              September 24, 1993. *                                         None

    (4) Instruments  defining  the rights of security
         holders,  including indentures

        (a) Specimen Share Certificate for Common Stock. *                  None

    (9)  Voting Trust Agreement and amendments                              None

    (10)  Material Contracts

        (10.1)  Agreement of Shareholders dated November 11, 1993
                 by and among C.E. Rick Strattan, Garrison Enterprises,
                 Inc. and the Company. *                                    None

        (10.2)  Lease Agreement dated July 7, 1994**.                       None

        (10.3)  Consulting Agreement dated July 29, 1994 between
                 the Company and Yellen Associates. *                       None

        (10.4)  License Agreement dated December 20, 1994 between
                 the Company and Herbe Wirkstoffe GmbH. *                   None

        (10.5)  Joint Venture Agreement between the Company and
                 Ocumed, Inc. dated May 1, 1995, incorporated by
                 reference to the Company's Form 10-QSB for the
                 quarter ended June 30, 1995.**                             None

        (10.6)  Extension of Agreement between the Company and Herbe
                 Wirkstoffe GmbH.***                                        None
        (10.7)  Lease Extension+

        (10.8)  Loan Agreement with John Lindsay+

<PAGE>

        (10.9)  Small Potatoes Contract+

        (10.10) Employment Agreement with C.E. Rick Strattan dated
                 May 30, 2001++

        (10.11) Employment Agreement of C.E. Rick Strattan dated
                 October 14, 2003+++

        (10.12) Employment Agreement of George L. Fails dated
                 October 14, 2003****

    (11)  Statement re: computation of per share earnings              Note 1(k)
                                                                    to Financial
                                                                      Statements
    (13)  Annual report to security holders for the last
          fiscal year, Form 10-Q or 10-QSB or quarterly report
          to security holders

    (14)  Code of Ethics

    (16)  Letter on changes in certifying accountant***                     None

    (18)  Letter on change in accounting principles                         None

    (21)  Subsidiaries of the small business issuer                         None

    (22)  Published Report regarding matters submitted to vote of
          security holders                                                  None

    (23)  Consent of experts and counsel                                    None

    (24)  Power of Attorney                                                 None

    (31)  Rule 13a-14(a)/15d-14a(a) Certifications****

    (32)  Section 1350 Certifications****

    (99)  Additional Exhibits

    (100) XBRL-Related Documents

<PAGE>

     *  Incorporated  by  reference to the  Company's  Form 10-SB filed with the
  Securities and Exchange Commission on February 1, 1994.

     **  Incorporated  by reference to the Company's  Form 10-KSB filed with the
  Securities and Exchange Commission on March 29, 1997.

    ***  Incorporated  by reference to the Company's  Form 10-KSB filed with the
  Securities and Exchange Commission on March 28, 2000.

   ****  Filed herewith.

    +  Incorporated  by  reference to the  Company's  Form 10-KSB filed with the
  Securities and Exchange Commission on April 2, 2001.

    ++  Incorporated  by reference to the  Company's  Form 10-KSB filed with the
Securities and Exchange Commission on April 1, 2002.

    +++ Incorporated by reference to Form S-8 filed December 1, 2003.


Item 14. Principal Accountant Fees and Services.

Audit Fees

The  aggregate  fees billed for the last fiscal year for  professional  services
rendered by the principal accountant,  Baumann, Raymondo & Company for the audit
of the Company's annual financial  statements and review of financial statements
included in the Company's Form 10-QSB or services that are normally  provided by
the  accountant  in  connection   with  statutory  and  regulatory   filings  or
engagements for those fiscal years was $6,000.

The aggregate fees billed for each of the last two fiscal years for professional
services rendered by the principal  accountant,  James Moore & Co., P.L. for the
audit of the  Company's  annual  financial  statements  and review of  financial
statements  included in the Company's  Form 10-QSB or services that are normally
provided by the accountant in connection  with statutory and regulatory  filings
or engagements for those fiscal years was $37,155.

<PAGE>

Audit-Related Fees

No fees were billed  during the last fiscal year for any  assurance  and related
services by Baumann,  Raymondo & Company that are not reported under the caption
"Audit Fees".  The nature of the services  comprising the fees disclosed  under
this  category  was  for  accounting  assistance  with  merger  and  acquisition
activities.

The aggregate fees billed in each of the last two fiscal years for assurance and
related  services by James Moore & Co., P.L. that are reasonably  related to the
performance of the audit or review of the Company's financial statements and are
not reported  under the caption  "Audit Fees" was  $1,695.  The nature of the
services  comprising the fees  disclosed  under this category was for accounting
assistance with merger and acquisition activities.

Tax Fees

No fees were  billed  during  the last  fiscal  year for  professional  services
rendered by Baumann,  Raymondo & Company for tax compliance,  tax advice, or tax
planning.

The aggregate fees billed in each of the last two fiscal years for  professional
services rendered by James Moore & Co., P.L. for tax compliance, tax advice, and
tax planning was $3,610.

All Other Fees

No other fees were billed during the last fiscal year for professional  services
provided by Baumann, Raymondo & Company.

The aggregate  fees billed in each of the last two fiscal years for products and
services  provided by James Moore & Co., P.L., other than the services  reported
above were $356 in paragraphs  (e)(1)  through (e)(3) of this section.  The
nature of the services  comprising  the fees  disclosed  under this category was
software training and assistance with payroll tax reporting.

<Page>

                                   SIGNATURES

     In accordance  with Section 13 or 15(d) of the Exchange Act, the Registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.

                                              CTD HOLDINGS, INC.


                                            By: /s/ C.E. Rick Strattan
                                               ---------------------------------
                                                  C.E. RICK STRATTAN,
                                                  Chief Executive Officer
                                                  Chief Operating Officer
                                                  Principal Accounting Officer
                                            Date: April 2, 2007

     In  accordance  with the Exchange Act, this report has been signed below by
the following  persons on behalf of the  registrant and in the capacities and on
the dates indicated.


                                            By: /s/ C.E. Rick Strattan
                                               ---------------------------------
                                                  C.E. RICK STRATTAN
                                                  Chief Executive Officer
                                                  Chief Operating Officer
                                                  Principal Accounting Officer
                                                  Director
                                            Date: April 2, 2007

                                            By: /s/ George L. Fails
                                               ---------------------------------
                                                  GEORGE L. FAILS
                                                  Director
                                            Date: April 2, 2007