U.S. 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 (Fee Required)

                   For the fiscal year ended December 31, 1998

( ) TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934 (No Fee Required)

              For the transition period from _________ to _________

                         Commission file number 0-24930

                   CYCLODEXTRIN TECHNOLOGIES DEVELOPMENT, 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.)

           3713 S. W. 42nd Avenue, Suite 3, Gainesville, FL 32608-6581
               (Address of principal executive offices) (Zip Code)

                     Issuer's telephone number: 352-375-6822

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:

                                     Common
                                (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 is not 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 ( )

     State issuer's revenues for its most recent fiscal year:  $276,675.

     State the aggregate market value of the voting stock held by non-affiliates
computed by reference  at the price at which the stock was sold,  or the average
bid and asked  prices of such stock,  as of a specified  date within the past 60
days: $58,512.50 based on the average high and low price as of March 5, 1998 of
$0.3125 per share.

     State the number of shares  outstanding of each of the issuer's  classes of
common equity, as of the latest practical date: 1,577,584 shares of Common Stock
as of February 4, 1999. 

                      DOCUMENTS INCORPORATED BY REFERENCE

                                      None

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



<PAGE>


PART I

Item 1.  Description of Business

     Cyclodextrin Technologies  Development,  Inc. ("the Company") was organized
as a Florida  corporation on August 9, 1990, with  operations  beginning in July
1992.  The Company sells  cyclodextrins  ("Cyclodextrins"  or "CDs") and related
products to the food,  pharmaceutical  and other  industries.  The Company  also
provides consulting services.

     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 are
already  developing  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.

     The Company  believes that 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. To
pursue this  opportunity  the Company has entered  into a joint  venture  with a
small ophthalmic manufacturing company.

     The Company provides consulting services for the commercial  development of
new products containing CDs. The Company's revenues are derived from consulting,
the distribution of CDs, the  manufacturing of selected CD complexes,  and sales
of its own manufactured and licensed products containing CDs.
<PAGE>

         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 (NCD's).

     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 ("CMCD's").
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.

     The  Company's  strategy  is  to  introduce  products  with  little  or  no
regulatory  burden in order to minimize product  expenses and create  profitable
revenue. 

     The Company  currently  sells its products  for use in the  pharmaceutical,
food and industrial chemical industries.
<PAGE>

         Industry

     The food additive industry has been  experimenting with CDs for many years.
Now that  commercial  supply of these  materials  can be  assured,  the  Company
believes that the food additive industry will significantly  increase its use of
CDs.

     CDs have  been  used in a  variety  of food  products  in Japan for over 10
years.  The  market  for the use of CDs in food  products  in 1997 in Japan  was
estimated at $150 million.  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 GRAS.

     Applications  of CDs in  personal  products  and for  industrial  uses have
appeared in many patents and patent  applications.  Proctor & Gamble uses CDs in
Bounce(R),  a popular fabric softener.  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 Japan at least nine  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 should be 2 to 3 1/2 times that of the CD itself.



<PAGE>

         Products

     The  Company's  products  include  its  Trappsol(R  ),  Aquaplex(R  ),  and
AP(TM)-Flavor product lines. The Trappsol product line consists of approximately
15 different  varieties of CDs and the Aquaplex  product line includes more than
three dozen  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  believes  that  by  marketing
Garlessence it has demonstrated  industry leadership.  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:    Trappsol(R),
Garlessence(R),  and Aquaplex (R). These  properties add to the intangible asset
value of the Company.

     CTD  purchases  CD's  from  commercial   manufacturers   around  the  world
including:  Wacker Chemie - Munich, Germany;  Ensuiko Sugar Refining Co., Ltd. -
Yokohama, Japan; Nihon Shokuhin Kako - Tokyo, Japan; Roquette Freres - Le Strem,
France;  American-Maize Products - Hammond IN, USA. CTD purchases specialty CD's
on occasion from Cyclolab R&D Company in Budapest, Hungary. The Company does not
manufacture cyclodextrins.

     The Company's first product,  Garlessence,  is manufactured for the Company
by Herbe Wirkstoffe (GmbH) of Berlin-Zehlendorf, Germany. Under the terms of its
agreements  with  Herbe-Wirkstoffe,  CTD has  rights to sell the  CD/garlic  oil
complex within the U.S., its territories and  possessions.  Exclusivity  expired
December 31, 1998,  but the Company  still has the  non-exclusive  right to sell
Garlessence(R).

     The Company has also introduced new products into its 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.
<PAGE>

         Business Strategy

     The  Company's  strategy  has  been  and will  continue  to be to  generate
profitable revenue through sales of CD related goods and services. The long term
success of this strategy  depends on the smooth and continuous  transition  into
CD-related products with increasing value-added attributes.

     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.  Up until 1995  almost  100% of the
revenue was generated by these products with the least  value-added  attributes.
Since 1995 sales of complexes increased until they contributed approximately 30%
of the revenue.

     Presently,  sales of CD complexes  represent 31% 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.  However,  it appears  that the base  business  of CD sales has
eroded. Combined with price reductions dictated by the market, the revenues from
the  sales of these  products  have  decreased  as much as the  revenue  from CD
complexes  has  increased.  The Company  continues to be dependent on just a few
customers  for the majority of its revenue.  In response to this  situation  the
Company has expanded its original  business strategy of parlaying its leadership
position  in the  presently  quite  small CD  industry  as a supplier of CDs, CD
derivatives, CD complexes to include:

(1)  Marketing  and  launching a dozen OTC and  naturaceutical  products  (e.g.,
     dietary  supplements)  utilizing  CD delivery  benefits.  For  example,  by
     extracting specific  ingredients from the garlic clove and complexing these
     ingredients with  Trappsol(R) B (beta  cyclodextrin)  Garlessence(R)  was
     created.  Similar  products  can be  created  with any of the other  herbal
     ingredients such as ginseng, echinacea, ginkgo, cat's claw, and melatonin.

(2)  Licensing the use of the  Trappsol(R)symbol  for use by others  wishing to
     use CD delivery  technology.  This strategy is reflected in the Garlessence
     package  which,  in  addition  to  the  Garlessence  trademark,  carries  a
     Trapposol  trademark.  This symbol will be promoted as an indication that a
     Trappsol(R)cyclodextrin  is used  with  the  product  within  and  thereby
     assures the user of the quality of the aqueous delivery system. This symbol
     will be licensed in the same way as the MLB (Major League  Baseball) symbol
     is  for  baseball  related  products  and  the  Nutrasweet(R)symbol  is for
     artificially sweetened products containing Nutrasweet(R).

(3)  Creating   independent   pharmaceutical   organizations  by  merging  basic
     manufacturing  capability with the Company's  technical product development
     and marketing  expertise;  these stand alone  organizations will be captive
     purchasers of CD complexes.

(4)  In-licensing and  out-licensing  basic CD applications  technology.  CTD is
     currently preparing a patent of its own for a veterinary euthanasia product
     based on  benzocaine.  The  euthanasia  product is an example of technology
     resulting  from the Company's  research and  development  which the Company
     will seek to out-license.
<PAGE>


     The Company intends to increase  its business  development  efforts in
the food additive and personal products  industries while continuing to build on
its 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 a
significant lead.

     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 various licensing situations.


<PAGE>


     Marketing Plan

     While at Pharmatec,  Inc. in the late 1980's,  Mr.  Strattan  pioneered the
marketing of derivatized  CDs and their drug complexes.  Mr. Strattan  contended
that  commercial  use and  development  of CDs could  only  begin in  earnest as
individuals and organizations became familiar with the truly unique solubilizing
and  stabilizing  properties of these starch  molecules.  Mr. Strattan set about
publicizing  the  benefits of CDs while other  companies  continued to hoard new
information  in  hopes of  protecting  imagined  exclusivity.  The  Company  has
continued  this effort to market CDs. The Company  believes  that the failure of
businesses to exchange information about these exciting molecules has hindered a
more rapid  commercialization  of CDs as safe  excipients.  The Company believes
that its  philosophy of partnering  and sharing will act as a catalyst to create
momentum  overcoming  the  inertia  created  by the  previous  conservatism  and
secrecy.

     The Company's sales have always been direct,  highly cyclical and driven by
advertising and participation in trade shows. Arrangements with large laboratory
supply  companies and several  diagnostic  companies have provided a more stable
sales base, but at the price of dependency on a few customers.  The objective in
this  unregulated  target market of life science  research is to increase annual
sales to $1,000,000  in 2000.  This growth is forecasted to occur as a result of
the Company's expansion of its product line to include value-added  complexes of
chemicals and CDs, increasing  promotional efforts and widespread  acceptance of
CDs by laboratories through word-of-mouth,  white paper circulation,  and hiring
of a  dedicated  product  manager  and  acquisition  or merger  with a qualified
technical laboratory.

     The Company has taken advantage of the propensity of researchers to use the
Internet to gather information about new products by establishing a WEB Page and
"site" on the world-wide web and obtaining a unique and descriptive domain name:
"cyclodex.com".
<PAGE>

     Historical Analysis

     Research Markets

     Historically  the  Company's  revenues  have  been  derived  from  sales to
individuals and companies which use the products in connection with research. In
1996  sales to the  "research"  market  averaged  almost  $14,500  per month and
accounted  for 50% of total  revenues.  In 1997  the  research  market  averaged
$23,547.  In 1998 average  sales per month to this R & D market were $16,000 and
they accounted for 70% of the company's total product sales.  These fluctuations
are  certainly  not trends but examples of the great  volatility of CD use in an
emerging industry.

     The Company believes the resell market will continue to grow accounting for
25-30% of the total revenues of the Company. The Company expects that any growth
will be  stimulated  by the  effect of  word-of-mouth  and the  availability  of
information  electronically  on the interent as more and more of these difficult
to reach end users log on. The Company believes current promotional efforts have
reached less than 5% of the potential end users.

     Pharmaceutical Companies

     The  objective  in this target  market has been to promote the  adoption of
CMCDs for those human  health care  compounds  that are either too  insoluble or
unstable in aqueous solutions for use in ethical,  over-the-counter  and generic
pharmaceutical  preparations.  There are a number  of  generic  and  proprietary
"problem"  drugs  where  solubility  has  been  improved  in  the  lab  by  CMCD
complexing.  All  pharmaceutical  companies  have many problem  drugs but cannot
generate  enough  solid   pharmacological  data  (due  to  poor  solubility  and
stability) to justify  extensive  in-house  formulation work. Many companies are
quite willing to contract out such work on their most promising prospects.

     Issues  of   regulatory   requirements,   clinical   testing,   and  patent
restrictions  have made this area of revenue  generation  very difficult for the
Company to break into.

         Current and Near-Term Activity

                  1999

     The Company has shown by example  (Garlessence(R))that  products containing
CDs may be introduced into the U.S. market. Rather than trying to push companies
to introduce CD  products,  the Company  intends to pull them into the market by
launching  approximately  seven new CD  containing  products of its own into the
U.S.  market over the next five years.  These products will address needs in the
relatively  unregulated  areas of natural  medicine,  topical OTC  preparations,
veterinary products, and home gardening.

     The  Company  intends  to work with  clients  in  countries  whose  current
regulatory  views do not exclude CDs as natural products acting as excipients to
introduce  beneficial  pharmaceuticals  improved by CDs. The terms for the joint
development  of CD  containing  drugs with several  medium-sized  pharmaceutical
companies  in South  America,  Australia  and South Africa are  currently  being
negotiated.

     Along  with  the  new  products  themselves,  the  Company  has  created  a
legitimate,  licensable mark that may be used by other manufacturers  wishing to
take advantage of the improved aqueous  delivery  afforded by Trappsol CDs. This
protected mark has the capability of generating  revenues in a manner similar to
the  Nutrasweet(R)  (artificial  sweetener)  and MLB(R) (major league  baseball)
logos.

     The Company intends to generate additional revenue through obtaining rights
to certain patents that it will sublicense to appropriate  organizations or that
it will use to  develop  its 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;   e.g.,  "will  CD  complexes  allow  microwave  baked
casseroles  to brown?  Will it provide  crispness to certain  microwave  foods?"
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.  However,  the benefits  derived from the use of other CDs
with expensive  ingredients (e.g.,  flavors,  fragrances) may justify the use of
CMCDs and/or NMCDs.
<PAGE>

     There exist  opportunities  for CD applications in industrial  applications
not  associated  with  pharmaceuticals  or  foods.  The  Company  believes  that
developers of these other industrial  applications  will approach CTD because of
its  leadership  and  partnering  philosophy  to help them  commercialize  their
products. Applications for which the Company has already received such inquiries
are:

                  (1)      Cleaning agent ingredients
                  (2)      Adhesive ingredients
                  (3)      Paint surface finishing product ingredients
                  (4)      Extrusion additives
                  (5)      LED dye ingredients

                  Long Term View (2001-2002)

     The  Company  believes  that  the  sales  of CDs,  CD  derivatives,  and CD
complexes  will always provide  sufficient  revenue to support a business of the
Company's  present size. The Company  intends to test its strategy of augmenting
these R&D derived revenues  through the  introduction of its own products,  e.g.
Garlessence.   Further,   by  allying  itself  with  appropriate   manufacturing
capabilities, the Company intends to introduce products which it manufactures.
Thus, the long-term goals of the Company are to:

(1) Sell CDs and related products and services to the R&D industry 
(2) Produce a line of its own products utilizing CDs for unregulated uses;
     e.g. naturaceuticals, geriatric nutriceuticals, naturacides. These products
     will carry a licensable  trade mark that will provide revenue when used on
     other products.
(3)  Own a portion of companies for which it guarantees a significant portion of
     that  JV's  business;  e.g.,  a  marketing/package  design  company,  a  CD
     applications R&D/pilot plant manufacturing company.
(4)  Form and operate joint ventures with companies to jointly develop  specific
     pharmaceutical applications of CDs.

     The Company anticipates that revenues from direct sales of its products and
services along with its portion of the profits of jointly owned  businesses will
create  sufficient  net  worth to permit  the  Company  to move from the  NASDAQ
Bulletin  Board up to the NASDAQ  Small Cap  Market.  With such a  structure  CD
technology  will be  introduced  from the  inside.  It is  anticipated  that the
Company  will  provide the CDs, CD  complexes,  and CD  technology  to its joint
venture companies at a profit.

         Competition

     The  Company is  currently a leading  consultant  in  determining  what the
manufacturing  standards  and costs for CDs and CMCDs are.  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.

     The  Company  intends  to form a more  formal  business  relationship  with
Cyclolab in Hungary by creating a Cyclolab-USA  laboratory  facility and thereby
strengthen  its  competitive  advantage.  Discussions  between the principals of
Cyclolab  and  CTD  have  been   ongoing  for  more  than  5  years.   Potential
relationships which have been discussed include joint venture arrangements,  the
Company's  outright  acquisition  of  Cyclolab  and the  employment  of Cyclolab
personnel to create Cyclolab-USA. There is no assurance that the Company will be
able to reach a formal business relationship with Cyclolab.

     By copyrighting  and registering  its own name brands,  CD logos,  etc. the
Company intends to create licensable icons much like Nutrasweet and Major League
Baseball have. Such a strategy allows the Company to benefit financially through
licensing royalties from the efforts of its competition.  
<PAGE>

         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
that the  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 the 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 at first to  introduce
products  that  will not be  regulated  by the FDA as drugs  because  all of its
ingredients are natural products or are 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

     In 1998 the Company  employed 3 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 Properties.

     The Company occupies a 3,000 sq. ft. building at 3713 S.W. 42nd Ave., Suite
3, Gainesville,  Florida 32608, pursuant to a 5-year lease beginning November 1,
1994.  The lease  provides for annual  increases in rent  ($18,000 for the first
year,  $18,900 for the second year,  $19,848 for the third year, $20,844 for the
fourth year and $21,888 for the fifth  year).  The Company also has an option to
lease  an  additional   3,000  sq.  ft.  of  space.   The  Company   houses  its
administrative  offices  in  approximately  1,100  sq.  ft.  of this  space;  an
additional 550 sq. ft. is dedicated to  laboratory/manufacturing  functions. The
remaining  1,350 sq. ft. has been prepared for  additional  laboratory and pilot
plant   manufacturing   use.  This  prepared   space  is  suitable  for  housing
Cyclolab-USA  and the  optioned  3,000  sq.  ft.  of space  can be used to house
graphic design functions and provide space for future expansion of Cyclolab USA.

     The current  marketing and sales activities are implemented from that site.
The entire 6,000 sq. ft. could  support a total of 12 - 15 people and  therefore
is expected to be adequate for the foreseeable future.  Current total office and
laboratory  operating  expenses  excluding salaries have stabilized at less than
$10,000 per month.

Item 3.  Legal Proceedings.
         None

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


<PAGE>


Part II

Item 5.  Market for Registrant's 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.
Since the commencement of trading of the Company's securities, there has been an
extremely limited market for its securities.  During the fourth quarter of 1995,
one of the Company's  market makers ceased  business.  The following  table sets
forth high and low bid quotations for the quarters  indicated as reported by the
OTC Bulletin Board.

<TABLE>
<S>           <C>                  <C>               <C>
                                    High               Low
1995          First Quarter        $ 7.50            $ 3.00
              Second Quarter       $ 8.50            $ 4.25
              Third Quarter        $ 9.00            $ 4.00
              Fourth Quarter       $ 8.00            $  .50
1996          First Quarter        $ 2.25            $  .50
              Second Quarter       $ 1.0625          $  .75
              Third Quarter        $ 2.25            $  .25
              Fourth Quarter       $ 1.00            $  .625
1997          First Quarter        $ 3.00            $  .75
              Second Quarter       $ 1.50            $  .562
              Third Quarter        $  .562           $  .437
              Fourth Quarter       $ 1.062           $  .531
1998          First Quarter        $ 0.875           $ 0.375
              Second Quarter       $ 0.625           $ 0.375
              Third Quarter        $ 0.500           $ 0.281
              Fourth Quarter       $ 0.260           $ 0.170
</TABLE>

     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  December  31,  1998 , 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 56 .

         Dividend Policy

     The Company  does not  anticipate  paying any cash  dividends on its common
stock in the  foreseeable  future  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.

     Item 6.  Management's  Discussion  and Analysis of Financial  Condition and
Results of Operations

               SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

     When used in this report, the words "believes," expects," "anticipates" and
similar  expressions  are  intended  to  identify  forward-looking   statements.
Statements herein regarding sales and research performance,  expected financing,
and expected  regulatory  approval of the Company's  products further constitute
forward-looking  statements  under federal  securities laws. Such statements are
subject  to  certain  risks  and  uncertainties  that  could  cause  the  actual
realization  to  be  delayed  or to  not  occur.  Management  has  made  certain
assumptions  regarding each of the statements  which may or may not be accurate.
Actual research and development  results may vary significantly from the current
plans.  Actual  Company  financing  activities may vary  significantly  from the
current plans and may result in the Company changing its plan of the use of such
proceeds.

LIQUIDITY AND CAPITAL RESOURCES

As of December 31, 1998, the Company's  working capital was $90,093  compared to
$108,781 at December 31, 1997.  The decrease is primarily  due to the  valuation
allowance for inventory.

Total product sales  remained  stable from 1997 to 1998,  decreasing by only 3%.
Consulting fee revenues are much less than last year's,  ($350 vs.  $86,667) but
management  expects  these  revenues to increase in 1999.  Selling,  General and
Administrative expenses (SG&A) decreased by 50% during 1998 compared to 1997 due
to a reduction in outside consulting, advertising and personnel costs.

Inventory  decreased  by 87% in 1998.  The  reduction in inventory is due to the
write  down of the  Garlessence  product  to net  realizable  value in the third
quarter of 1998.  Management  continues  to  maintain  appropriate  cyclodextrin
inventory levels in response to normal customer sales.


During 1998, Rick Strattan,  the Company's  President,  made short term loans to
the Company  totaling  $16,800.  These loans were repaid  prior to December  31,
1998.  Management does not expect further funding to be required in 1999 to meet
the Company's cash needs.

In 1997,  the Company  entered  into a financial  consulting  agreement to raise
equity capital for the purpose of funding new drug applications.  As of July 31,
1998 no new capital was raised, the agreement was terminated, and the previously
capitalized  deferred  offering costs  ($71,347)  were  expensed.  Plans for the
anticipated new drug  applications  have been suspended until alternate  funding
becomes  available.  However,  there is no assurance that any additional funding
will be available.  While some of the costs were paid out of operations,  almost
40% were paid by the  issuance of stock.  The Company  still  expects to benefit
from the  continued  efforts  of these  financial  consultants  through  ongoing
negotiations and growing interest by other companies.

To meet the  financial  needs of expected  future  growth,  the Company  filed a
registration  statement with the SEC to make a public  offering in 1996 and 1997
of 250,000 shares of common stock and 125,000 warrants of the Company. No shares
of stock were sold in this offering.  The offering closed April 30, 1997 and the
Company expensed the previously  capitalized  deferred offering costs ($127,467)
in the second quarter of 1997. While most of these offering costs were non-cash,
the net result was a loss in the financial  results  reported for the year ended
December 31, 1997.

The Company  currently has a $25,000 credit line with no outstanding  balance as
of December 31, 1998.  The Company also has available  approximately  $90,000 in
combined credit card lines with less than $1,000 outstanding on these lines.

The Company is in the fourth year of a five-year  lease for 3,000 square feet of
space for an office, laboratory, and manufacturing plant. The Company moved into
the building during October 1994. Rent payments are $18,000 in year one, $18,900
in year two,  $19,484 in year three,  $20,844 in year four,  and $21,888 in year
five. The Company also has a purchase  option on this space in which ten percent
of the lease  payments  may be applied to the  purchase  price.  The Company may
exercise an option to lease an additional  3,000 square feet of adjoining space.
The Company houses its  administrative  offices,  laboratory,  and manufacturing
facility in this complex,  utilizing an aggregate of approximately  1,650 square
feet.  This  facility has been built,  and can be  expanded,  according to "GMP"
(good manufacturing practices)  specifications in anticipation of the commercial
needs of the markets the Company  serves.  The  remaining  1,350  square feet of
space is for pilot plant  manufacturing and an analytical  laboratory.  However,
this  expansion will require  additional  funding and there is no assurance that
any additional funding will be available.  Management has no immediate plans for
this  expansion.  The Company  plans to  negotiate  a new lease on the  existing
building or to begin evaluations of alternate properties during 1999.

On May 1, 1995 the Company  entered  into a joint  venture  operating as Ocudex,
Inc. The Company and Ocumed,  Inc., (Ocumed) an unrelated company,  each own 50%
of Ocudex.  The Company had agreed to provide  funds on a best efforts  basis of
not more than $10,000 per month for up to 12 months. As of December 31, 1997 the
Company had advanced a total of $51,000 and realized  losses of $11,094 to date.
Since  there was no  activity  at Ocudex  during  all of 1997 and the  Company's
efforts  to  acquire  the assets of Ocumed,  did not  materialize,  the  Company
provided an allowance in the fourth quarter of 1997 for the remaining investment
in the amount of $40,406.  The Ocudex  corporate shell will remain available for
future use as the Company will continue to work with Ocumed to bring  ophthalmic
drugs using cyclodextrins to the market.

During  the  eight  years  of its  existence  the  Company  has  created  a 
comprehensive database on patents involving cyclodextrins. Currently, management
is in the process of adding this  database to the  Company's  existing web site.
Customers will have access to the patent database through a subscription service
with a monthly  fee. The cost of the database is expected to be less than $5,000
and is being paid out of operations. However, the subscriptions fee revenue will
provide  continuing  income at little or no  further  cost to the  company.  The
original  $5,000  expense  will be  recovered  within  the  first  two  years of
operation.  The Company plans to add additional  subscription databases on other
cyclodextrin information in the future. These databases can be added with little
cost to the company.

Management  has completed  its  evaluation of Year 2000 (y2k) issues on internal
computer  systems.  Management has also completed its initial  assessment of y2k
issues  related to the company's  external  vendors and  suppliers.  The Company
relies on a few large  customers  and  suppliers  outside of the United  States,
which are believed to be at greater y2k risk than domestic  companies with which
the Company does  business.  While there are no assurances  that y2k issues will
not affect the company, Management does not believe its internal or external y2k
issues, if any, will have a material effect on the company's  business,  results
of  operations,  or  financial  condition.  Although  management  has sought and
obtained assurances from its major suppliers and customers regarding operational
continuity in light of Y2k problems, supply or demand interruptions in these key
relationships  would  cause a  resulting  interruption  in the  business  of the
Company.

RESULTS OF OPERATIONS

Sales of  cyclodextrins  and related  manufactured  complexes  are  historically
highly volatile. While annual sales remain constant, the Company is dependent on
a small  number of larger  orders  throughout  the year in order to maintain its
current  volume of sales.  In efforts to offset  this  volatility,  the  Company
continues  to expand its  revenue  producing  activities  to  include  providing
research and development services for unrelated companies,  creating proprietary
databases on its web site that will generate subscription revenues and expanding
its inventory line to include more routinely purchased products. While sales are
still  volatile,  Management  believes that these other revenues will offset the
volatility  of  cyclodextrin  sales and that  product and service  sales will be
augmented by profitable web-site subscription services.

Sales for the years ended December 31, 1998 and 1997 remained constant ($276,352
in 1998 vs. $283,677 in 1997). Management expects cyclodextrin sales to continue
at historical levels in the near term.

Product  sales are  primarily to large  pharmaceutical  and food  companies  for
research and development purposes. Sales of both products and services have been
concentrated  among a few large  customers.  For  1998,  one  customer  has been
responsible  for 48% of total sales and over the past three  years has  averaged
40% of total sales.

The Company's gross profit margin on product sales increased from 75% to 80% for
1997 and 1998,  respectively.  This  increase in gross profit margin is in large
part due to sales in the third  quarter 1998 of inventory  items  obtained at no
cost to the Company.  Occasionally,  the Company is able to obtain quantities of
product free or at a reduced cost from the manufacturer  for sampling  purposes.
The  Company is often able to sell  portions  of this  product to its  customers
resulting  in unusually  high gross  margins due to the low  acquisition  costs.
Future sales of these low cost  products,  while not assured,  will  continue to
positively  affect the  Company's  future  gross profit and net income when they
occur.

Selling,  general and administrative (SG&A) expenses for 1998 decreased 50% from
1997 ($175,427 vs. $347,685).  However,  SG&A expenses for 1997 included $53,320
of outside  consulting  services  related to the $86,667 in consulting  revenues
earned. These expenses are unusual and are not expected to recur. Excluding this
amount, normal SG&A expenses decreased by $118,938 (175,427 vs. $294,365).  This
decrease is the result of a reduction  in  personnel  and related  costs made in
1997 as well as a decrease in advertising,  amortization and professional  fees.
Management continues to manage SG&A expenses in efforts to keep expenses in line
with revenues.

Consulting  services  in 1998 were $350  compared  to $86,667 in the same period
1997.  Consulting sales in 1997 resulted from a research and development project
contracted to the Company in the third and fourth quarters.

The Company has unused  operating loss  carryforwards  and deductible  temporary
differences totaling approximately $1,567,000 at December 31, 1998. If not used,
the  carryforwards  expire in years beginning in 2011. If all the operating loss
carryforwards and deductible temporary  differences were used, the Company would
realize a deferred  tax asset of  approximately  $345,000  based  upon  expected
income tax rates.  Realization  depends on generating  sufficient taxable income
before the  expiration of the loss  carryforwards.  Although  realization is not
assured,  Management  believes that sixty-two  percent of the deferred tax asset
will be realized based upon anticipated  profitability in the future. The amount
of the deferred tax asset considered  realizable,  however,  could be reduced in
the near term if  estimates of future  taxable  income  during the  carryforward
period are reduced.  The Company has recorded income tax expense of $35,000 as a
result of an increase in the valuation  allowance on the deferred tax asset less
the tax benefit of  temporary  differences  at December  31,  1998.  The Company
recorded an income tax benefit of $32,975 for the year ended  December 31, 1997,
reflecting the future benefit of the 1997 net operating loss, net of a valuation
allowance.

The  Company  experienced  three  large  expenses in 1998:  an  allowance  for a
write-down  of the  remaining  Garlessence  inventory to net  realizable  value;
offering  expenses  from an aborted  private  placement  issue and  reduction of
deferred offering expenses;  and the reduction of the deferred tax asset derived
from the operating loss carryforwards. Combined, these items total $162,876. The
effect of these  items on EPS for 1998 was a reduction  of $0.12;  from $0.04 to
($0.08). The Company's loss from operations for the year ended December 31, 1998
was ($82,484).  However,  the Company's net income from  operations for the year
ended  December 31, 1998 before  income taxes,  inventory  allowance and certain
public  offering  expenses  was  $45,392.   Management  believes  the  inventory
allowance and certain public offering  expenses are unusual and are not expected
to recur in normal operations of the Company.

The  Company's net loss from  operations  before income taxes for the year ended
December 31, 1997 before the public offering  expenses was ($48,568).  Comparing
the results of  operations  before the inventory  allowance and public  offering
costs for the years 1998 and 1997,  there is a $93,960  improvement in operating
results  from 1997 to 1998.  Operationally,  the  above  expenses  removed,  the
Company was  profitable for year ended  December 31, 1998.  This  improvement in
operating results is due primarily to the reduced SG&A expenses.

The Company continues to develop new products,  seek additional  financing,  and
implement its strategy of creating operational  affiliates that will use CD's in
herbal medicines, wastewater remediation, and pharmaceuticals.

 


     Item 7.  Financial Statements

     Financial  statements  are submitted as an exhibit under Items 13(a)(1) and
(2) on this Form 10-KSB.

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

     On December 23, 1997,  the Company  engaged  James Moore & Co., P.L. as its
independent  accountants for 1997. The work of Davis,  Monk & Co. was terminated
on December 23, 1997.  The dismissal of Davis,  Monk & Co. and the engagement of
James Moore & Co., P.L. was approved by the Company's Board of Directors.

     During  fiscal years ended  December 31, 1998 and December 31, 1997,  there
were no  disagreements  with James Moore & Co.,  P.L.on any matter of accounting
principles or practices,  financial  statement  disclosure or auditing  scope or
procedure or any reportable events.

     The reports on the financial statements performed by James Moore & Co., P.L
for the past two years ended December 31, 1998,  contained no adverse opinion or
disclaimer  of opinion and were not  qualified  or  modified as to  uncertainty,
audit scope or accounting principles.


<PAGE>



PART III.

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

<TABLE>
<S>                      <C>    <C>                       <C>
Name                     Age    Position                  Since
C.E. Rick Strattan       53     President/CEO, Director   August, 1990
</TABLE>



     C.E. Rick Strattan,  has been President and a Director of the Company since
its formation.  He 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 became its Director of Marketing and Business Development for CDs.
He was responsible for CD sales and related business development  efforts.  From
November,  1985  through  May,  1987 he 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.  He is a graduate of the  University of Florida with a BS 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.  Mr.  Strattan's  professional  and
technical experience are deemed highly important to the Company. See "Business -
General."

Compliance with Section 16(a) of the Securities Exchange Act of 1934

     Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
executive officers,  directors and persons who beneficially own more than 10% of
the Company's  Common Stock to file initial  reports of ownership and reports of
changes in ownership with the Securities and Exchange Commission  ("SEC").  Such
persons are  required by SEC  regulations  to furnish the Company with copies of
all Section 16(a) forms filed by such persons.

     Based solely on the Company's review of such forms furnished to the Company
and written  representation from certain reporting persons, the Company believes
that during the fiscal year ended  December  31, 1998,  all filing  requirements
applicable  to the  Company's  executive  officers,  directors and more than 10%
shareholders were complied with.



<PAGE>


Item 10. Executive Compensation

     Executive  compensation  is  determined  by the  Board  of  Directors.  All
compensation  paid by the Company for services  rendered during the three fiscal
years ended December 31, 1996,  1997 and 1998 for each executive  officer is set
forth in the following table: 
<TABLE>
<CAPTION>

                                            SUMMARY  COMPENSATION  TABLE  (three
                                    fiscal years ended December 31, 1995, 1996 and 1997)

                                                                  Annual                     Long Term
                                                               Compensation                Compensation
                                                  ---------------------------------------------------------


                                                                             Other              All
                                                                             Annual            Other
Name and Principal Position                Year    Salary      Bonus      Compensation      Compensation
<S>                                        <C>     <C>        <C>             <C>           <C>

C.E. Rick Strattan                         1998    $15,500    $10,000         -0-               -0-
    Chief Executive Officer, President     1997    $34,750      -0-           -0-               -0-
                                           1996    $24,000      -0-           -0-               -0-

Lisa Stephens                              1998    $25,000     $  500         -0-            $  281.25 (1)
    Chief Financial Officer

David L. Southworth(2)                     1998      -0-        -0-           -0-               -0-
    Treasurer/Chief Financial Officer      1997    $15,686      -0-           -0-               -0-
                                           1996    $21,550      -0-           -0-               -0-

</TABLE>
     (1) On November 24, 1998,  the Company issued 1,500 shares to Lisa Stephens
for compensation for services.

     (2) On  June  30,  1997,  Mr.  Southworth  resigned  from  the  Company  as
Treasurer/Chief Financial Officer.

     On November 15, 1995, the Company  adopted a  non-qualified  employee stock
purchase plan pursuant to which employees may purchase  restricted shares of the
Company's  common stock at a price of 50% of the current bid price of the shares
in  amounts  not to exceed  the  employee's  gross  pay.  Pursuant  to the plan,
employees have elected to purchase  33,400  shares,  of which 15,800 shares have
been purchased by Mr. Strattan.

Performance-Based Stock Compensation

     On February 4, 1999, the Company issued 250,000 shares to Mr. Strattan as a
performance bonus.

     On February 4, 1999, the Company issued 1,500 shares to Lisa Stephens as a
performance bonus.

Item 11.  Security Ownership of Certain Beneficial Owners and Management.

     The following  table shows the ownership of the Common Stock of the Company
on February 17, 1999, by each person who, to the knowledge of the Company, owned
beneficially  more than five (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 or .........Amount and Nature of   Approximate %
Identity of Group ..........................Beneficial Ownership     of Class

C.E. Rick Strattan(1).......................      781,800             49.56%
4123 N.W. 46th Avenue
Gainesville, FL 32606

Burckhardt & Company, Inc...................      106,474              6.75%
1304 South DeSoto Avenue, Suite 203
Tampa, Florida 33606

All Officers and Directors as a group ......       888,274            56.31%



     (1) Held by Strattan Associates, Ltd., of which Mr. Strattan is the general
partner.  Strattan Associates,  Ltd. is a limited partnership established by Mr.
Strattan  for estate tax  purposes  and is not  otherwise  engaged in  business.
Strattan  Associates,  Ltd. is the owner of the 500,000 shares of CTD stock. Mr.
Strattan is the President/CEO and Director of the Company.

Item 12.  Certain Relationships and Related Transactions.

     In November 1993, the Company entered into a Business Consulting  Agreement
with Garrison  Enterprises,  Inc. ("Garrison") to provide consulting services to
the Company in the areas of the  evaluation of  managerial,  marketing and sales
requirements;   reviewing  and  analyzing   proposed   business   opportunities;
consulting  with the  Company on  strategic  corporate  planning  and  long-term
investment  policies;  and rendering  advice with respect to future fund raising
and other financial arrangements.  As compensation for its services Garrison was
issued 300,000 shares of the Company's  Common Stock and after completion of the
Company's  private  placement  offering in May, 1994,  Garrison began  receiving
$7,000 per month for a period of 3 years and $10,000 per month for the  two-year
period thereafter.

     In November  1993,  C.E. Rick Strattan,  the President of the Company,  and
Garrison entered into a Shareholder's Agreement.  Pursuant to which Mr. Strattan
and Garrison (the  "Shareholders")  agreed to vote their shares so as to provide
that the  Directors of the Company  shall be C.E.  Rick  Strattan and Michael A.
Schub ("Schub"). In addition, the Shareholders agreed to an annual salary to the
President  of the  Company  of $7,000  per month for the three  years  after the
closing of the stock offering, increasing to $10,000 per month in years four and
five.

     Subsequently,  on June 16,  1994,  Mr.  Schub  resigned as Vice  President,
Secretary and Director of the Company.  On June 23, 1994,  Barry R. Klein became
Secretary  and a Director of the Company.  In addition,  Mr. Schub was president
and a director of Garrison  from  inception  to June 23,  1994,  when Mr.  Schub
resigned.

     Upon Mr. Schub's  resignation as an officer and director of the Company and
Garrison,  the Company  entered  into a retainer  agreement  with Schub  thereby
retaining Schub as special counsel,  at a monthly retainer of $1,750  commencing
July 1, 1994 and  continuing  until March 31, 1997.  From April 1, 1997 to March
31,  1999,  said  retainer  was to be  increased  to $2,500 per month.  Garrison
thereafter agreed to reduce its compensation from the Company in an amount equal
to the monthly retainer paid to Schub.

     On  August  1,  1994,  the  Company  entered  into a  five-year  consulting
agreement  (renewable  annually  by mutual  agreement)  with  Yellen  Associates
("Yellen").  Yellen agreed to provide ideas for new products in the nutritional,
geriatric, and related health fields; to find companies and/or products suitable
for acquisition;  to find products suitable for manufacture and/or distribution;
and to secure customers for Company products. All products offered by Yellen and
accepted by the Company will belong  exclusively to the Company with all related
rights.  In return,  the Company  agreed to pay Yellen $2,000 per month for nine
months.  If sales of Yellen  products had been at least $200,000 per year,  this
monthly  payment  would have  automatically  continued  for one year.  Any other
continuance of the payment would be negotiated.  Additionally, the Company would
pay Yellen  royalties  of up to 5% of sales for three to five years for products
acquired through Yellen or cyclodextrin  sales made by Yellen.  The Company also
agreed to sell to Yellen over a period of three years from August 1, 1994, up to
30,000  shares of Company  stock at a discount of 50% of the market price quoted
at the time of purchase.  Having satisfied the guaranteed  minimum payments part
of the agreement in April,  1995, the Company chose to  discontinue  the monthly
payments.

     In September  1994,  the Company  prepaid its  consulting  agreements  with
Garrison and Schub for an amount  equal to  $180,000.  Garrison and Schub are no
longer  providing  services  to  the  Company.   The  Company  terminated  these
agreements  because it believed that the  marketing  and  financial  services of
Schub and  Garrison  would not be needed for the  remaining  term of five years.
Thus,  the Company  bought out of these  agreements  at a discount of  $270,000.
Under  the  terms  of  the  contracts,  the  Company  was  obligated  to  expend
approximately $450,000 over the next year term of the agreement.

     On December 12, 1994, the Company adopted a stock issuance plan pursuant to
which  employees  named by the board of  directors  receive  shares  in  amounts
determined by the board.  Shares  received  pursuant to the 1994 plan are vested
after five years.  During the third, fourth and fifth years the stock is held by
an employee,  the employee may cause the Company to repurchase  the stock at 50%
of the then current  market value.  Since its inception  35,000 shares have been
issued pursuant to the plan, of which 10,000 have been repurchased.

     On May l, 1995,  the  Company  agreed to  purchase  all of Mr.  Herschleb's
common  shares  of the  Company  (10,000  shares)  at a price of $2.50 per share
payable in 12 monthly installments without interest.

     On May 1, 1995,  the Company  entered into a Joint Venture  Agreement  with
Ocumed,  Inc.  Under the terms of the  Agreement,  the  parties  have  created a
separate  entity called  Ocudex,  Inc. for the purpose of developing and selling
ophthalmic  products  manufactured  by Ocumed and  developed  by the Company for
which the Company will provide funding of up to $120,000 over a 12-month period.
The Company and Ocumed each own 50% of Ocudex, Inc.

     On  June  30,  1997,   Mr.   Southworth   resigned   from  the  Company  as
Treasurer/Chief Financial Officer.

     On March 10, 1998, the Company  adopted a resolution  whereby 10,000 shares
of the  Company's  common  stock,  issued in the name of Gregory V.  DeLong,  be
returned to the  Company's  treasury  stock as authorized  but unissued  shares,
pursuant to a Stock Power retained by the Company.

     The Company has adopted a  resolution  whereby up to 100,000  shares may be
transferred to Mr.  Strattan  based on his  performance in the discretion of the
Board of Directors which is solely comprised of Mr. Strattan.

     On November 24, 1998,  the Company  issued 106,474 shares to Burckhardt and
Co. for its services performed in 1998.

     On August 10, 1998,  the Company  purchased  10,000  shares of common stock
from Atlanta  Syndication  Network,  Inc. for $5,000. The shares were originally
issued in April 1997. The shares were canceled after the Company bought them.

     On February 4, 1999,  the Company  issued 1,500 shares to Lisa Stephens for
her services.

<PAGE>


PART IV.

Item 13.  Exhibits and Reports on Form 8-K.

(a) Exhibits                                                                Page

    (1) Reports of Independent Certified Accountants                        F-1

    (2) Financial Statements                                                F-2

    Exhibits required by Item 601, Regulation S-B:

    (3) Articles of incorporation and by-laws

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

       (b) By-Laws. *                                                       None

       (c)    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                                             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

    (11)  Statement re: Computation of Per Share Earnings             Note 1 to
                                                                      Financial
                                                                      Statements

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

    (18)  Letter on change in accounting principles                         None

    (22)  Subsidiaries of Registrant                                        None

    (23)  Published Report re:  Matters Submitted to Vote of
          Security Holders                                                  None

    (24)  Consents of Experts and Counsel                                   None

    (25)  Power of Attorney                                                 None

    (27)  Financial Data Schedule

    (28)  Additional Exhibits                                               None

    (29)  Information from reports furnished to state insurance
          regulatory authorities                                            None


(b) Reports on Form 8-K:

         No Form 8-K was filed for the quarter ended December 31, 1998.

     *  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, 1998.


                                   SIGNATURES


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


(Registrant)      CYCLODEXTRIN TECHNOLOGIES DEVELOPMENT, INC.


                                /S/
By (Signature and Title)_______________________________________
                                    C.E. RICK STRATTAN, President,
                                    Chief Executive Officer, Chief
                                    Operating Officer and
                                    Director

Date: March 31, 1999