>




**U.S.
      SECURITIES AND EXCHANGE COMMISSION**


**Washington,
      D.C. 20549**


________________




**FORM
      10-QSB**


________________




x  **QUARTERLY
      REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934**





For
      the
      quarterly period ended March 31, 2006





o  **TRANSITION
      REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT**





For
      the
      transition period from  to





Commission
      file number 000-29807


________________




**ENTROPIN,
      INC.**


**(Exact
      name of small business issuer as specified in its charter)**




________________




**DELAWARE**
            **68-0510827****(State
                or other jurisdiction of**
            **(IRS
                employer****incorporation
                or organization)**
            **Identification
                No.)**




**13314
      Lost Key Place, Bradenton, FL. 34202**


**(Address
      of principal executive offices)**





**(941)
      388-9512**


**(Issuer’s
      telephone number)**





**Former
      Address**


**45926
      Oasis Street, Indio, CA 92201**





**Former
      Telephone Number**


**(760)
      775-8333**


________________




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 o





Indicate
      by check mark whether the Registrant is a shell company (as defined in Rule
      12b-2 of the Exchange Act.):  Yes x No o


As
      of
      March 31, 2006, 30,645,341  shares
      of
      the issuer’s Common Stock, $.0001 par value per share, were outstanding.





Transitional
      Small Business Disclosure Format Yes o No x









**INDEX**




**PART I.**
            **FINANCIAL
                INFORMATION**Item 1.
            Financial
                StatementsCondensed
                Balance Sheets - December 31, 2005 and March 31, 2006
                (unaudited)
            2Condensed
                Statements of Operations - For the Three Months Ended March 31, 2005
                and
                2006 (and for the Period from August 27, 1984 (Inception) through
                March
                31, 2006 (unaudited)
            3Condensed
                Statement of Changes in Stockholders’ Equity - For the Three Months Ended
                March 31, 2006 (unaudited)
            4Condensed
                Statements of Cash Flows - For the Three Months Ended March 31, 2005
                and
                2006 and for the Period from August 27, 1984 (Inception) through
                March 31,
                2006 (unaudited)
            5Notes
                to Condensed Financial Statements (unaudited)
            7Item
                2.
            Management’s
                Discussion and Analysis of Financial Condition and Results of
                Operations
            10Item
                3.
            Controls
                and Procedures
            14**PART II.**
            **OTHER
                INFORMATION**Item
                1.
            Legal
                Proceedings
            15Item
                2.
            Unregistered
                Sales of Equity Securities and Use of Proceeds
            15Item
                3.
            Defaults
                upon Senior Securities
            1566Item
                4.
            Submission
                of Matters to a Vote of Security Holders
            15Item
                5.
            Other
                Information
            15Item
                6.
            Exhibits
            15Signatures
            17




1


**ENTROPIN,
                INC.**
              **(A
                DEVELOPMENT STAGE COMPANY)**
              **CONDENSED
                BALANCE SHEETS**
              **December
                31, 2005 and March 31, 2006****December
                31,**
              **2005**
            
            **March
                31,**
              **2006****(unaudited)**Current
                assets:Cash
                and cash equivalents
            
            $
            112,841
            
            $
            96,676Prepaid
                expenses
            
            
            --
            
            
            425Total
                current assets
            
            $
            112,841
            
            $
            97,081Total
                assets
            
            $
            112,841
            
            $
            97,081**LIABILITIES
                AND STOCKHOLDERS’ DEFICIT**Current
                liabilities:Accounts
                payable
            
            $
            589,114
            
            $
            579,967Commitments
                & contingenciesStockholders’
                deficit:Series
                A’ redeemable preferred stock, $.0001 par value; 3,210,487 shares
                authorized, and 3,210,487 shares issued and outstanding, $1.00 per
                share
                redemption value
            
            
            3,210,487
            
            
            3,210,487Common
                stock, $.0001 par value; 200,000,000 shares authorized; 30,645,341
                shares
                issued and outstanding
            
            
            3,065
            
            
            3,065Additional
                paid-in capital
            
            
            34,819,422
            
            
            34,819,422Deficit
                accumulated during the development stage
            
            
            (38,509,247
            )
            
            (38,515,860
            )Total
                stockholders’ deficit
            
            
            (476,273
            )
            
            (482,886
            )Total
                liabilities and stockholders’ deficit
            
            $
            112,841
            
            $
            97,081






See
      accompanying notes to condensed financial statements.




2




**ENTROPIN,
      INC.**


**(A
      DEVELOPMENT STAGE COMPANY)**


**CONDENSED
      STATEMENTS OF OPERATIONS**


**For
      the Three Months Ended March 31, 2005 and 2006**


**and
      for the Period from August 27, 1984 (Inception) Through March 31, 2006**


**(Unaudited)**




**2005**
            
            **2006**
            
            **Inception through**
              **March
                31, 2006**Costs
                and expenses:Research
                and development
            
            $
            56,067
            
            $
            —
            
            $
            16,043,819General
                and administrative
            
            
            430,806
            
            
            6,613
            
            
            21,847,676Impairment
                of patent costs
            
            
            —
            
            
            —
            
            
            695,572Operating
                loss
            
            
            (486,873
            )
            
            (6,613
            )
            
            (38,587,067
            )Other
                income (expense):Interest
                income
            
            
            16,677
            
            
            —
            
            
            1,529,259Interest
                expense
            
            
            —
            
            
            —
            
            
            (242,811
            )Other
                Expense
            
            
            —
            
            
            —
            
            
            (127,241
            )Total
                other income (expense), net
            
            
            16,677
            
            
            —
            
            
            1,159,207Net
                loss
            
            
            (470,196
            )
            
            (6,613
            )
            
            (37,427,860
            )Dividends
                applicable to Series B preferred stockholders
            
            
            —
            
            
            —
            
            
            (1,103,184
            )Net
                loss applicable to common stockholders
            
            $
            (470,196
            )
            $
            (6,613
            )
            $
            (38,531,044
            )Basic
                and diluted net loss per common share
            
            $
            (0.02
            )
            $
            (0.00
            )
            $
            (4.43
            )Weighted
                average common shares outstanding
            
            
            30,645,000
            
            
            30,645,000
            
            
            8,689,000





See
      accompanying notes to condensed financial statements.




3





**ENTROPIN,
      INC.**


**(A
      DEVELOPMENT STAGE COMPANY)**


**CONDENSED
      STATEMENT OF CHANGES IN STOCKHOLDERS’ DEFICIT**


**For
      the Three Months Ended March 31, 2006**


**(Unaudited)**





**Deficit****accumulated****Series
                A Redeemble**
            
            
            
            
            
            
            
            **Additional**
            
            
            **during**
            
            
            **Total****Preferred
                Stock**
            
            **Common
                Stock**
            
            
            **paid-in**
            
            
            **development**
            
            
            **stockholders’****Shares**
            
            
            **Amount**
            
            **Shares**
            
            
            **Amount**
            
            
            **capital**
            
            
            **stage**
            
            
            **equity**Balance,
                January 1, 2006
            
            3,210,487
            
            $
            3,210,487
            
            30,645,341
            
            $
            3,065
            
            $
            34,819,422
            
            $
            (38,509,247)
            
            $
            (476,273)Net
                loss for the period
            
            —
            
            
            —
            
            —
            
            
            —
            
            
            —
            
            
            (6,613)
            
            
            (6,613)Balance,
                March 31, 2006
            
            3,210,487
            
            $
            3,210,487
            
            30,645,341
            
            $
            3,065
            
            $
            34,819,422
            
            $
            (38,515,860)
            
            $
            (482,886)







See
      accompanying notes to condensed financial statements.





4


**ENTROPIN,
      INC.**


**(A
      DEVELOPMENT STAGE COMPANY)**


**CONDENSED
      STATEMENTS OF CASH FLOWS**


**For
      the Three Months Ended March 31, 2005 and 2006**


**and
      for the Period from August 27, 1984 (Inception) Through March 31, 2006**


**(Unaudited)**


**2005**
            
            **2006**
            
            **Inception through**
              **March
                31, 2006**Cash
                flows from operating activities:Net
                loss
            
            $
            (470,196
            )
            $
            (6,613
            )
            $
            (37,427,860
            )Adjustments
                to reconcile net loss to net cash used in operating
                activities:Depreciation
                and amortization
            
            
            14,802
            
            
            —
            
            
            352,584Impairment
                of patent costs
            
            
            —
            
            
            —
            
            
            695,572Series
                B preferred stock redemption conversion incentive
            
            
            —
            
            
            —
            
            
            126,309Loss
                on disposal of assets
            
            
            —
            
            
            —
            
            
            1,837Services
                received in exchange for stock, stock options and warrants
            
            
            —
            
            
            —
            
            
            10,642,845Services
                received in exchange for compensation agreements
            
            
            —
            
            
            —
            
            
            2,231,678Increase
                in prepaid expenses
            
            
            (70,677)
            
            
            (425)
            
            
            (425)Increase
                (decrease) in accounts payable
            
            
            113,262
            
            
            (9,147
            )
            
            787,664Other
            
            
            —
            
            
            —
            
            
            58,610Net
                cash used in operating activities
            
            
            (412,809
            )
            
            (16,185
            )
            
            (22,531,186
            )Cash
                flows from investing activities:Maturities
                (purchase) of short-term investments, net
            
            
            (1,076,582
            )
            
            —
            
            
            —Patent
                costs
            
            
            (50,188
            )
            
            —
            
            
            (976,433
            )Purchase
                of property and equipment
            
            
            —
            
            
            —
            
            
            (130,515
            )Net
                cash provided by (used in) investing activities
            
            
            1,026,394
            
            
            —
            
            
            (1,106,948
            )Cash
                flows from financing activities:Proceeds
                from issuance of common stock and warrants
            
            
            —
            
            
            —
            
            
            21,732,261Proceeds
                from issuance of preferred stock
            
            
            —
            
            
            —
            
            
            1,142,750Proceeds
                from stockholder loans
            
            
            —
            
            
            —
            
            
            809,679Proceeds
                from shares issued pursuant to recapitalization
            
            
            —
            
            
            —
            
            
            220,100Proceeds
                from stockholder advances
            
            
            —
            
            
            —
            
            
            98,873Repayments
                of stockholder advances
            
            
            —
            
            
            —
            
            
            (98,873
            )Repurchase
                of common stock
            
            
            —
            
            
            —
            
            
            (40,000
            )Payment
                for cancellation of common stock warrant
            
            
            —
            
            
            —
            
            
            (330,000
            )Proceeds
                from convertible notes payable
            
            
            —
            
            
            —
            
            
            200,000Net
                cash provided by financing activities
            
            
            —
            
            
            —
            
            
            23,734,790Net
                (decrease) increase in cash and cash equivalents
            
            
            613,585
            
            
            (16,185
            )
            
            96,656Cash
                and cash equivalents at beginning of period
            
            
            444,611
            
            
            112,841
            
            
            —Cash
                and cash equivalents at end of period
            
            $
            1,058,196
            
            $
            96,656
            
            $
            96,656


(Continued
      on following page)


See
      accompanying notes to condensed financial statements.




5




**ENTROPIN,
      INC.**


**(A
      DEVELOPMENT STAGE COMPANY)**


**CONDENSED
      STATEMENTS OF CASH FLOWS**


**For
      the Three Months Ended March 31, 2005 and 2006**


**and
      for the Period from August 27, 1984 (Inception) Through March 31, 2006**


**(Unaudited)**





(Continued
      from preceding page)





Supplemental
      disclosure of cash flow information:




**2005**
            
            **2006**
            
            **Inception through**
              **March
                31, 2006**Cash
                paid for interest during the period
            
            $
            —
            
            $
            —
            
            $
            242,811





Supplemental
      disclosure of non-cash investing and financing activities:





During
      the period from August 27, 1984 (inception) through March 31, 2006, the Company
      issued 3,210,487 shares of Series A preferred stock in exchange for an aggregate
      $1,710,487 of notes payable to stockholders plus accrued interest and a
      $1,500,000 compensation agreement.





During
      the period from August 27, 1984 (inception) through March 31, 2006, the Company
      converted promissory notes payable with outstanding principal and interest
      balances totaling $201,660 into 100,831 shares of common stock.





During
      the period from August 27, 1984 (inception) through March 31, 2006, the Company
      issued 94,850 shares of common stock at $5.00 per share as payment of accrued
      dividends on Series B preferred stock.





During
      the period from August 27, 1984 (inception) through March 31, 2006, the Company
      issued 1,337,333 shares of common stock totaling $1,336,609, for conversion
      of
      shares of Series B preferred stock.





See
      accompanying notes to condensed financial statements.




6




**ENTROPIN,
      INC.**


**(A
      DEVELOPMENT STAGE COMPANY)**


**NOTES
      TO CONDENSED FINANCIAL STATEMENTS**


**(Unaudited)**





The
      accompanying financial statements of Entropin, Inc. have been prepared in
      accordance with accounting principles generally accepted in the United States
      of
      America (“GAAP”) for interim financial information and with the instructions to
      Form 10-QSB and Item 310(b) of Regulation S-B. Certain information and note
      disclosures normally included in financial statements prepared in accordance
      with GAAP have been condensed or omitted under such rules and regulations.
      Accordingly, they do not include all of the information and footnotes required
      by GAAP for complete financial statements. In the opinion of management, the
      financial statements reflect all adjustments considered necessary for a fair
      presentation. The results of operations for the three months ended March 31,
      2006 are not necessarily indicative of the results to be expected for the full
      year. For further information, refer to the financial statements and notes
      thereto included in our annual report on Form 10-KSB for the year ended December
      31, 2005 as filed with the Securities and Exchange Commission on April 11,
      2006.





1. Organization
      and summary of significant accounting policies





Organization
      and basis of presentation:





Entropin,
      Inc. (the “Company”), a Delaware corporation, was organized as a California
      corporation in August 1984. The Company is a pharmaceutical research and
      development company focused on the development of its proprietary compound,
      ENT-103, as a pain therapy. Activities from inception include research and
      development, seeking the U.S. Food and Drug Administration, or FDA, approval
      for
      its proprietary compounds, including its current drug candidate, ENT-103, as
      well as fund raising.





The
      Company is no longer seeking FDA approval for these products due to a lack
      of
      capital. The Company is currently seeking additional capital and evaluating
      the
      possibility of a merger with another company.





Going
      Concern:





As
      of
      March 31, 2006, the Company had total current assets of $97,081. The Company’s
      financial statements have been presented on a going concern basis, which
      contemplates the realization of assets and the satisfaction of liabilities
      in
      the normal course of business. The Company is in the development stage and
      has
      been primarily involved in research and development activities. This has
      resulted in significant operating losses and an accumulated deficit at March
      31,
      2006 of $38,515,860. Management anticipates additional operating losses for
      the
      foreseeable future. These factors, among others, indicate that the Company
      will
      be unable to continue as a going concern unless it can immediately obtain
      significant additional funds to support its operations. The financial statements
      do not include any adjustments related to the recoverability of recorded asset
      amounts that may be necessary should the Company be unable to continue as a
      going concern. In the absence of positive cash flows from operations which
      the
      Company expects will not be possible for several years, if at all, the Company
      is and will remain highly dependent on its ability to secure additional funding
      through the issuance of debt or equity instruments, corporate partnering or
      merger/acquisition arrangements. As the Company was unable to raise sufficient
      additional funds on a timely basis, it was forced to cease its operations prior
      to the end of the second quarter of 2005.





It
      is
      management’s plan to put all of its effort into settling the outstanding
      litigation against the Company in the immediate future. Once the litigation
      is
      resolved, the Company intends to seek a merger or acquisition with another
      strategic company. There can be no assurance that the litigation will be
      resolved or that a merger or acquisition will be consummated.





The
      Company does not have capital sufficient to meet the Company’s cash needs,
      including the cost of compliance with the continuing reporting requirements
      of
      the Securities Exchange Act of 1934. The Company will have to seek loans or
      equity placements to cover such cash needs. Lack of existing capital may be
      a
      sufficient impediment to prevent the Company from accomplishing the goal of
      successfully executing a new business strategy. The Company will need to raise
      additional funds to conduct its business activities in the next twelve
      months.





At
      this
      time the Company has no commitments to provide funds. Accordingly, there can
      be
      no assurances that any additional funds will be available to the Company to
      allow it to cover its expenses as they are incurred.




7




Because
      the Company has not yet completed product development, obtained regulatory
      approval, or verified the market acceptance and demand for any products it
      may
      develop, its activities have been accounted for as those of a “development stage
      enterprise” as set forth in Statement of Financial Accounting Standards No. 7,
“Accounting and Reporting by Development Stage Enterprises”.





Use
      of
      estimates:





The
      preparation of financial statements in conformity with accounting principles
      generally accepted in the United States of America requires management to make
      estimates and assumptions that affect the reported amounts of assets and
      liabilities and disclosure of contingent assets and liabilities at the date
      of
      the financial statements and the reported amounts of revenues and expenses
      during the reporting period. Actual results could differ from those estimates.





Income
      taxes:





The
      Company provides for income taxes utilizing the asset and liability approach
      under which deferred income taxes are recognized based upon currently enacted
      tax laws and rates applicable to the periods in which the taxes are expected
      to
      become payable. A valuation allowance is established for deferred income tax
      assets when their realization is not reasonably assured.





Property
      and equipment:





Office
      furniture and equipment is recorded at cost. Depreciation commences as items
      are
      placed in service and is computed using the straight-line method over their
      estimated useful lives of three years.





Leasehold
      improvements are recorded at cost and amortized using the straight-line method
      over the shorter of their estimated useful life or the related lease term.





Research
      and development costs:





Research
      and development costs are expensed as incurred.





Patents:





The
      Company believes that patents and other proprietary rights are important to
      its
      business. It is the Company’s policy to file patent applications to protect its
      technology, inventions and improvements to inventions that are considered
      important to the development of its business. Patent costs are capitalized
      and
      amortized on a straight-line basis over an estimated useful life of 16
      years.





Amortization
      expense related to amortizable patents was $14,359 and $0 for the three months
      ended March 31, 2005 and 2006, respectively, and approximately $1 million from
      inception through March 31, 2006. The Company decided to write off the balance
      of the patents as of September 30, 2005, due to a lack of capital to fund the
      approval process for the patents.





Impairment
      of long-lived assets:





The
      Company evaluates its long-lived assets for impairment whenever events or
      changes in circumstances indicate that the carrying amount of such assets or
      intangibles may not be recoverable. Recoverability of assets to be held and
      used
      is measured by a comparison of the carrying amount of an asset to future
      undiscounted net cash flows expected to be generated by the asset. If such
      assets are considered to be impaired, the impairment to be recognized is
      measured by the amount by which the carrying amount of the assets exceeds the
      fair value of the assets. Assets to be disposed of are reported at the lower
      of
      the carrying amount or fair value less costs to sell.




8





Concentrations
      of credit risk:





The
      Company invests its excess cash principally in certificates of deposit. The
      Company has established guidelines relative to diversification and maturities
      that maintain safety and liquidity. These guidelines are periodically reviewed
      and modified to take advantage of trends in yields and interest rates. The
      Company has not experienced any losses on its cash equivalents or short-term
      investments.





Stock-based
      compensation:





The
      Company follows the fair value method of accounting for employee stock-based
      compensation provided for in Statement of Financial Accounting Standards No.
      123, “Accounting for Stock-Based Compensation”. Compensation cost for stock
      option grants is measured as the fair value of the options using the
      Black-Scholes option pricing model. Amounts recorded for options granted to
      non-employees are determined in accordance with Statement of Financial
      Accounting Standards No. 123 and EITF 96-18 based on the fair value of the
      consideration or the fair value of the equity instruments issued, whichever
      is
      more reliably measured.





Fair
      value of financial instruments:





The
      carrying amounts of cash, cash equivalents, short-term investments and accounts
      payable are considered to be representative of their respective fair values
      because of their short-term nature.





Loss
      per
      share:





Net
      loss
      per common share is computed using the weighted average number of common shares
      outstanding. Basic and diluted net loss per common share amounts are equivalent
      for the periods presented as the inclusion of common stock equivalents in the
      number of shares used for the diluted computation would be anti-dilutive.
      Dividends on preferred stock, consisting of 10% cumulative dividends and deemed
      dividends related to the beneficial conversion feature and mandatory redemption
      accretion of Series B preferred stock, are added to net loss for the purpose
      of
      determining net loss and net loss per share amounts applicable to common
      stockholders.





Segment
      reporting:





The
      Company currently operates in a single segment. In addition, financial results
      are prepared and reviewed by management as a single operating segment. The
      Company continually evaluates its operating activities and the method utilized
      by management to evaluate such activities and will report on a segment basis
      when appropriate to do so.





2. Commitments
      and contingencies





Entropin
      and two of its former directors and officers are currently defendants in two
      securities fraud lawsuits that concern the Company’s March 2000 public offering.
      The first of these lawsuits, *Deveny
      et al. v. Entropin Inc., et al* .(“ *Deveny* ”),
      was
      filed in the California Superior Court in January 2003. The second of these
      lawsuits, *In
      re: Entropin Securities Litigation* ,
      was
      filed in the United States District Court for the Central District of California
      in August 2004. In both lawsuits, the central allegation is that Entropin,
      in
      its March 2000 registration statement, made false and misleading statements
      regarding: (1) the results of Entropin’s Phase II clinical studies on the
      Company’s experimental drug Esterom; (2) Entropin’s Phase IIIA clinical studies
      on Esterom; and (3) Entropin’s ability to file a new drug application (“NDA”)
      for Esterom in 2001.




With
      respect to the *Deveny* lawsuit,
      in June 2004, Judge Christopher Sheldon of the California Superior Court granted
      Entropin’s summary judgment motion and dismissed Plaintiffs’ complaint after
      finding that it had been filed after the pertinent statutes of limitations
      had
      expired. Plaintiffs are currently appealing this ruling to the California
      Appellate Court. The appeal has been fully briefed and the parties are awaiting
      a decision from the California Appellate Court. While the Company feels that
      Judge Sheldon’s decision to dismiss the *Deveny* lawsuit
      was correct and should be sustained on appeal, it cannot predict how the
      California Appellate Court will rule.




The
      parties in *In
      re: Entropin Securities Litigation* are
      currently undertaking substantial discovery in support of their claims and/or
      defenses. On May 23, 2005, Judge Richard S. Lew issued a scheduling order
      setting a tentative trial date for June 20, 2006. At the direction of the United
      States District Court, the parties are actively considering the possibility
      of a
      negotiated settlement. However, the Company feels that its March 2000
      registration statement was neither false nor misleading and intends, if
      necessary, to vigorously defend itself against Plaintiffs’ allegations to the
      contrary. We cannot predict the outcome at this time.




9




**Item 2.**  **MANAGEMENT’S
      DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS**





*The
      following discussion and analysis should be read in conjunction with the
      unaudited financial statements and notes thereto included in Part I - Item
      1 of
      this report, and the audited financial statements and notes thereto contained
      in
      our Annual Report on Form 10-KSB for the fiscal year ended December 31,
      2005.*





The
      following Management’s Discussion and Analysis of Financial Condition and
      Results of Operations and other portions of this Form 10-QSB contain
      forward-looking statements within the meaning of Section 21E of the Securities
      Exchange Act of 1934, as amended, and are subject to the Safe Harbor provisions
      created by that statute. In some cases, you can identify the forward-looking
      statements by terminology such as
“may,”“will,”“should,”“could,”“expects,”“plans,”“anticipates,”“believes,”“estimates,”“predicts,”“potential”
or “continue” or the negative of these terms or other comparable terminology.
      Our business and results of operations are subject to various risks and
      uncertainties as disclosed under the caption “Factors That May Affect Our Future
      Results and the Trading Price of Our Common Stock” in this Form 10-QSB. These
      risks and uncertainties include our need and ability to raise significant
      additional capital; our history of significant operating losses; our ability
      to
      successfully complete formulation, development and preclinical studies for
      our
      sole drug candidate, ENT-103; the time, cost and uncertainty of obtaining
      regulatory approvals; and our ability to successfully commercialize products.
      The actual results that we achieve may differ materially from any
      forward-looking statements due to these risks and uncertainties and we undertake
      no obligation to update any such forward-looking statements.





We
      were
      incorporated in California in 1984 as Entropin, Inc., old (“Entropin”), and in
      1998 completed a merger with and into Vanden Capital Group, Inc. (“Vanden”),
      pursuant to which all of the issued and outstanding common shares of old
      Entropin were converted into a majority of Vanden’s common stock. Vanden
      subsequently changed its name to Entropin, Inc. For accounting purposes, the
      acquisition was treated as a recapitalization of old Entropin based upon
      historical cost, with old Entropin as the acquirer. In conjunction with the
      merger, Entropin, became a Colorado corporation. In June 2002, we changed our
      state of incorporation from Colorado to Delaware.





From
      our
      inception in August 1984, we have devoted our resources primarily to funding
      our
      research and development efforts and conducting clinical trials with our
      products. We have been unprofitable since inception and have had no revenue
      from
      the sale of products, and do not expect revenue for the foreseeable future
      until
      we have received FDA approval for one of the proprietary compounds we were
      attempting to develop. As of March 31, 2006, our accumulated deficit was
      approximately $38.5 million.





As
      of
      March 31, 2006, we had total current assets of approximately $97,000. Our
      available funds are not sufficient to allow us to pursue any further development
      of our proprietary drug candidate, ENT-103, including the preclinical work
      necessary to prepare and file an Investigational New Drug application with
      the
      FDA or to commence human clinical trials for ENT-103. As we were unable to
      immediately obtain significant additional funds to support our operations,
      we
      were forced to cease our operations prior to the end of the second quarter
      of
      2005.





We
      do not
      have capital sufficient to meet our cash needs, including the cost of compliance
      with the continuing reporting requirements of the Securities Exchange Act of
      1934. We will have to seek loans or funds through equity placements to cover
      such cash needs. Lack of existing capital may be sufficient impediment to
      prevent us from conducting our business activities in the next twelve
      months.





At
      this
      time, we have no commitments to provide funds. Accordingly, there can be no
      assurances that any funds will be available to us to allow us to cover our
      expenses as they are incurred.




10




**Going
      Concern:**





Our
      independent auditors have added an explanatory paragraph in connection with
      the
      December 31, 2005 financial statements, which states that our Company is in
      the
      development stage and has incurred an accumulated deficit at December 31, 2005
      of approximately $38.5 million. These conditions give rise to substantial doubt
      about our Company’s ability to continue as a going concern. The Company is
      dependant on its ability to secure additional funding through the issuance
      of
      debt or equity instruments, corporate partnering or merger/acquisition
      arrangements. The Company ceased its business operations in the second quarter
      of 2005.





It
      is
      management’s plan to put all of its effort into settling the outstanding
      litigation against the Company in the immediate future. Once the litigation
      is
      resolved, the Company intends to seek a merger or acquisition with another
      strategic company. There can be no assurance that the litigation will be
      resolved or that a merger or acquisition will be consummated.





**Plan
      of Operation**





Our
      available funds are not sufficient to allow us to pursue any further development
      of our proprietary drug candidate, ENT-103, including the preclinical work
      necessary to prepare and file an Investigational New Drug application with
      the
      FDA or to commence human clinical trials for ENT-103. We are actively seeking
      additional funding through potential merger/acquisition transactions coupled
      with public or private sales of our equity or debt securities. We also intend
      to
      seek additional funding from corporate partnerships or licensing arrangements
      or
      through public or private sales of our equity or debt securities. Any such
      transactions may require us to relinquish rights to some of our technologies
      or
      products, and will be dilutive to our existing stockholders. We cannot guarantee
      that we will be able to complete any such transaction or secure additional
      funds
      on a timely basis, or at all, and we cannot assure that such transaction will
      be
      on reasonable terms. As we were unable to obtain the significant additional
      funds to support our operations, we had to cease our operations prior to the
      end
      of the second quarter of 2005.





We
      do not
      have capital sufficient to meet our cash needs, including the cost of compliance
      with the continuing reporting requirements of the Securities Exchange Act of
      1934. We will have to seek loans or funds from equity placements to cover such
      cash needs. Lack of existing capital may be a sufficient impediment to prevent
      us from accomplishing the goal of successfully executing a new business
      strategy. We will need to raise additional funds to conduct our business
      activities in the next twelve months.





At
      this
      time, we have no commitments to provide funds. Accordingly, there can be no
      assurances that any additional funds will be available to us to allow us to
      cover our expenses as they are incurred.





**Results
      of Operations**





**Three
      months ended March 31, 2006, compared to three months ended March 31, 2005.**




The
      net
      loss for the three months ended March 31, 2005 was approximately $7,000, as
      compared to approximately $470,000 for the same period in 2005. This decrease
      of
      $463,000 or 98.4% was due to a cessation of operations since May,
      2005.





Total
      research and development expenses were $0 for the three months ended March
      31,
      2006, as compared to approximately $56,000 for the same period in 2005, a
      decrease of $56,000 or 100%, due to the cessation of operations.





Total
      general and administrative expenses were approximately $7,000 for the three
      months ended March 31, 2006, as compared to approximately $431,000 for the
      same
      period in 2005, a decrease of $424,000 or 98.4%, due to the cessation of
      operations.





Interest
      income during the three months ended March 31, 2006 was $0 as compared to
      approximately $17,000 during the same period in 2005, a decrease of $17,000
      or
      100%. This decrease in interest income reflects zero short-term investments
      during the three months ended March 31, 2006.





**Liquidity
      and Capital Resources**





As
      of
      March 31, 2006, we had total current assets of approximately $97,000. Our
      financial statements have been presented on a going concern basis. We have
      an
      immediate need to raise additional funds to continue our operations. There
      can
      be no assurance that such additional capital will be available on a timely
      basis
      or on terms acceptable to us, if at all. As we were unable to obtain the
      significant additional funds to support our operations, we had to cease our
      operations prior to the end of the second quarter of 2005.




11




We
      are in
      the development stage and have been primarily involved in research and
      development activities. This has resulted in significant operating losses and
      an
      accumulated deficit at March 31, 2006 of approximately $38.5 million. Our
      management anticipates additional operating losses for the foreseeable future.
      These factors, among others, indicate that we will be unable to continue as
      a
      going concern unless it can immediately obtain significant additional funds
      to
      support its operations. We have financed our operations since inception
      primarily through the net proceeds generated from the sale of our common and
      preferred stock, and through loans and advances from stockholders that were
      subsequently converted into equity securities. From inception through March
      31,
      2006, we have received net cash proceeds from financing activities aggregating
      approximately $23.7 million. As of March 31, 2006, we had a negative working
      capital of approximately $483,000.





Our
      liquidity and capital needs relate primarily to working capital, research and
      development of ENT-103, and other general corporate requirements. We have not
      received any cash from operations since inception.





Net
      cash
      used in operating activities was approximately $16,000 during the first three
      months of 2006, compared with approximately $413,000 during the first three
      months of 2005. No research was done during the first three months of 2006.
      However, during the same period in 2005, the cash used in operations was
      primarily related to conducting preclinical research studies and maintaining
      our
      administrative infrastructure.





**Critical
      Accounting Policies**





We
      routinely granted stock options to compensate officers, directors and employees
      for their services. This practice allowed us to conserve our cash resources
      for
      our drug development program. We had adopted the fair value accounting
      provisions of Statement of Financial Accounting Standards No. 123, “Accounting
      for Stock-Based Compensation”. Under these provisions, stock based compensation
      was measured based on the fair value of the options granted using the
      Black-Scholes option-pricing model. Amounts recorded for options granted to
      non-employees were determined in accordance with Statement of Financial
      Accounting Standards No. 123 and EITF 96-18 based on the fair value of the
      consideration or the fair value of the equity instruments issued, whichever
      was
      more reliably measured.





**Factors
      That May Affect Our Future Results and the Trading Price of Our Common Stock**





*An
      investment in shares of our common stock involves a high degree of risk. You
      should consider carefully the following information about these risks, together
      with other information contained in this report and our other filings with
      the
      Securities and Exchange Commission before you decide to buy our stock. If any
      of
      the following risks actually occur, our business, financial condition and
      prospects would likely suffer. Additional risks and uncertainties not presently
      known to us or that we currently deem immaterial may also impair our operations.*





**We
      are subject to a going concern opinion and have ceased our business
      operations.**





Our
      independent auditors have added an explanatory paragraph in connection with
      the
      December 31, 2005 financial statements, which states that our Company is in
      the
      development stage and has incurred an accumulated deficit at December 31, 2005
      of $38,509,247. At March 31, 2006, the Company had an accumulated deficit of
      approximately $38.5 million. These conditions give rise to substantial doubt
      about our Company’s ability to continue as a going concern. The Company is
      dependant on its ability to secure additional funding through the issuance
      of
      debt or equity instruments, corporate partnering or merger/acquisition
      arrangements. The Company ceased its business operations in the second quarter
      of 2005.





It
      is
      management’s plan to put all of its effort into settling the outstanding
      litigation against the Company in the immediate future. Once the litigation
      is
      resolved, the Company intends to seek a merger or acquisition with another
      strategic company. There can be no assurance that the litigation will be
      resolved or that a merger or acquisition will be consummated.




**We
      need to raise additional funds immediately in order to resume our operations.**





As
      of
      March 31, 2006, we had total current assets of approximately $97,000. We ceased
      our opertions in the second quarter of 2005. Our financial statements have
      been
      presented on a going concern basis. Our available funds are not sufficient
      to
      allow us to begin any further development of our proprietary drug candidate,
      ENT-103, including the preclinical work necessary to prepare and file an
      Investigational New Drug (IND) application with the FDA or to commence human
      clinical trials for ENT-103. We ceased our business operations in the second
      quarter of 2005. We are actively seeking additional funding through potential
      merger/acquisition transactions coupled with public or private sales of our
      equity or debt securities. Any such transactions may require us to relinquish
      rights to some of our technologies or products, and will be dilutive to our
      existing stockholders. We cannot guarantee that we will be able to complete
      any
      such transaction or secure additional funds on a timely basis, or at all, and
      we
      cannot assure that such transaction will be on reasonable terms. As we were
      unable to obtain significant additional funds to support our operations, we
      had
      to cease our operations prior to the end of the second quarter of 2005.




12




We
      do not
      have capital sufficient to meet our cash needs, including the cost of compliance
      with the continuing reporting requirements of the Securities Exchange Act of
      1934. We will have to seek loans or funds from equity placements to cover such
      cash needs. Lack of existing capital may be sufficient impediment to prevent
      us
      from accomplishing the goal of successfully executing a new business strategy.
      We will need to raise additional funds to conduct its business activities in
      the
      next twelve months.





At
      this
      time, we have no commitments to provide funds. Accordingly, there can be no
      assurances that any funds will be available to us to allow us to cover our
      expenses as they are incurred.




**We
      have a history of losses and we may never achieve or maintain profitability.**





To
      date
      we have experienced significant operating losses in funding the research,
      development and testing of our previous drug candidate, Esterom solution, and
      our subsequent and current drug candidates, ENT-102 and ENT-103. From our
      inception through March 31, 2006, we have incurred cumulative net losses
      applicable to common stockholders of $38.5 million. We ceased operations in
      the
      second quarter of 2005.





**The
      securities lawsuits
      filed against the Company and two of its directors are diverting the Company’s
      resources and attention, and if the Company is required to continue to defend
      against these lawsuits, its business and financial condition will continue
      to be
      harmed.**





Entropin
      and two of its former directors and officers are currently defendants in two
      securities fraud lawsuits that concern the Company’s March 2000 public offering.
      The first of these lawsuits, *Deveny
      et al. v. Entropin Inc., et al* .(“ *Deveny* ”),
      was
      filed in the California Superior Court in January 2003. The second of these
      lawsuits, *In
      re: Entropin Securities Litigation* ,
      was
      filed in the United States District Court for the Central District of California
      in August 2004. In both lawsuits, the central allegation is that Entropin,
      in
      its March 2000 registration statement, made false and misleading statements
      regarding: (1) the results of Entropin’s Phase II clinical studies on the
      Company’s experimental drug Esterom; (2) Entropin’s Phase IIIA clinical studies
      on Esterom; and (3) Entropin’s ability to file a new drug application (“NDA”)
      for Esterom in 2001.




With
      respect to the *Deveny* lawsuit,
      in June 2004, Judge Christopher Sheldon of the California Superior Court granted
      Entropin’s summary judgment motion and dismissed Plaintiffs’ complaint after
      finding that it had been filed after the pertinent statutes of limitations
      had
      expired. Plaintiffs are currently appealing this ruling to the California
      Appellate Court. The appeal has been fully briefed and the Parties are awaiting
      a decision from the California Appellate Court. While the Company feels that
      Judge Sheldon’s decision to dismiss the *Deveny* lawsuit
      was correct and should be sustained on appeal, it cannot predict how the
      California Appellate Court will rule.




The
      Parties in *In
      re: Entropin Securities Litigation* are
      currently undertaking substantial discovery in support of their claims and/or
      defenses. On May 23, 2005, Judge Richard S. Lew issued a scheduling order
      setting a tentative trial date for June 20, 2006. At the direction of the United
      States District Court, the Parties are actively considering the possibility
      of a
      negotiated settlement. However, the Company feels that its March 2000
      registration statement was neither false nor misleading and intends, if
      necessary, to vigorously defend itself against Plaintiffs’ allegations to the
      contrary. We cannot predict the outcome at this time.





**The
      existing trading market for our securities is limited, which affects the price
      and liquidity of our securities.**





On
      June
      26, 2003, our common stock was delisted from the Nasdaq SmallCap Market and
      now
      trades on the OTC Bulletin Board. Securities trading on the OTC Bulletin Board
      typically suffer from lower liquidity, which may lead to depressed trading
      prices, greater price volatility and difficultly in buying or selling shares,
      particularly in large quantities. Currently, there is a limited trading market
      for our common stock and we cannot predict when, if ever, a fully developed
      public market for the common stock will occur. If a developed public trading
      market for the common stock does develop at a future time, there are no
      assurances that it will be sustained for any period of time. Any sales of shares
      by stockholders in substantial amounts in the public market could adversely
      affect the prevailing market price and could impair our future ability to raise
      capital through the sale of equity securities.




13




In
      addition, the SEC has adopted regulations which generally define “penny stock”
to be any listed, trading equity security that has a market price less than
      $5.00 per share or an exercise price of less than $5.00 per share. These
      requirements may restrict the ability of broker-dealers to sell our common
      stock
      and may affect the ability of purchasers in this offering to sell our securities
      in the secondary market.





**We
      may sell additional shares of capital stock in the future, which could dilute
      your investment.**





Our
      Board
      of Directors approved an amendment to the Company’s Certificate of Incorporation
      on August 31, 2004, to increase the number of authorized shares of common stock
      from 50,000,000 shares to 200,000,000 shares. Our stockholders approved the
      proposal to increase the number authorized shares of common stock at a special
      meeting held on November 19, 2004. The approval of this proposal by the
      Company’s stockholders provides the Board of Directors with a significant number
      of additional shares of common stock to issue in fund raising activities and
      for
      other corporate purposes. Our Certificate of Incorporation also provides for
      the
      issuance of up to 10,000,000 shares of preferred stock. The issuance of these
      additional shares of common stock and/or preferred stock will have a dilutive
      effect on the equity and voting power of the existing holders of our common
      stock. It may also adversely affect the market price of our common stock. As
      of
      March 31, 2006, there were 30,645,341 shares of common stock issued and
      outstanding and 3,210,487 shares of Series A’ preferred stock issued and
      outstanding.





**The
      price of common stock has fluctuated greatly over the past several years and
      we
      expect this volatility to continue.**





The
      market prices and trading volumes for the securities of development stage
      companies in general, and for our securities in particular, have historically
      been highly volatile and have experienced significant price and volume
      fluctuations. These fluctuations may or may not be related to our operating
      performance, and the announcement of developments regarding our products,
      regulatory approval status, competition, government regulation or other matters
      that are material to our business or prospects may cause significant swings
      in
      our stock prices.





**Item 3.**  **CONTROLS
      AND PROCEDURES**





**(A)**  **Evaluation
      of Disclosure Controls and Procedures**





As
      of the
      end of the period covered by this report, the Company carried out an evaluation,
      under the supervision and with the participation of the Company’s Principal
      Executive Officer/Principal Financial Officer of the effectiveness of the design
      and operation of the Company’s disclosure controls and procedures. The Company’s
      disclosure controls and procedures are designed to provide a reasonable level
      of
      assurance of achieving the Company’s disclosure control objectives. The
      Company’s Principal Executive Officer/Principal Financial Officer has concluded
      that the Company’s disclosure controls and procedures are, in fact, effective at
      this reasonable assurance level as of the period covered. In addition, the
      Company reviewed its internal controls, and there have been no significant
      changes in its internal controls or in other factors that could significantly
      affect those controls subsequent to the date of their last evaluation or from
      the end of the reporting period to the date of this Form 10-QSB.





**(B)**  **Changes
      in Internal Controls Over Financial Reporting**





In
      connection with the evaluation of the Company’s internal controls during the
      Company’s first fiscal quarter ended March 31, 2006, the Company’s Principal
      Executive Officer/Principal Financial Officer has determined that there are
      no
      changes to the Company’s internal controls over financial reporting that has
      materially affected, or is reasonably likely to materially effect, the Company’s
      internal controls over financial reporting.




14




**PART
      II.**





**OTHER
      INFORMATION**





**Item
      1.**  **Legal
      Proceedings**





Entropin
      and two of its former directors and officers are currently defendants in two
      securities fraud lawsuits that concern the Company’s March 2000 public offering.
      The first of these lawsuits, *Deveny
      et al. v. Entropin Inc., et al* .(“ *Deveny* ”),
      was
      filed in the California Superior Court in January 2003. The second of these
      lawsuits, *In
      re: Entropin Securities Litigation* ,
      was
      filed in the United States District Court for the Central District of California
      in August 2004. In both lawsuits, the central allegation is that Entropin,
      in
      its March 2000 registration statement, made false and misleading statements
      regarding: (1) the results of Entropin’s Phase II clinical studies on the
      Company’s experimental drug Esterom; (2) Entropin’s Phase IIIA clinical studies
      on Esterom; and (3) Entropin’s ability to file a new drug application (“NDA”)
      for Esterom in 2001.




With
      respect to the *Deveny* lawsuit,
      in June 2004, Judge Christopher Sheldon of the California Superior Court granted
      Entropin’s summary judgment motion and dismissed Plaintiffs’ complaint after
      finding that it had been filed after the pertinent statutes of limitations
      had
      expired. Plaintiffs are currently appealing this ruling to the California
      Appellate Court. The appeal has been fully briefed and the Parties are awaiting
      a decision from the California Appellate Court. While the Company feels that
      Judge Sheldon’s decision to dismiss the *Deveny* lawsuit
      was correct and should be sustained on appeal, it cannot predict how the
      California Appellate Court will rule.




The
      Parties in *In
      re: Entropin Securities Litigation* are
      currently undertaking substantial discovery in support of their claims and/or
      defenses. On May 23, 2005, Judge Richard S. Lew issued a scheduling order
      setting a tentative trial date for June 20, 2006. At the direction of the United
      States District Court, the Parties are actively considering the possibility
      of a
      negotiated settlement. However, the Company feels that its March 2000
      registration statement was neither false nor misleading and intends, if
      necessary, to vigorously defend itself against Plaintiffs’ allegations to the
      contrary. We cannot predict the outcome at this time.







**Item
      2.**  **Unregistered
      Sales of Equity Securities and Use of Proceeds**





None.





**Item
      3.**  **Defaults
      Upon Senior Securities**





None.





**Item
      4.**  **Submission
      of Matters to a Vote of Security Holders**





None





**Item
      5.**  **Other
      Information**





None.




**Item
      6.**  **Exhibits**





**Exhibits**





**Exhibit
                Number**
            
            **Description**2.1
            
            Agreement
                of Plan of Merger, dated May 2, 2002, by and between Entropin, Inc.,
                a
                Delaware Corporation and Entropin, Inc., a Colorado corporation
                (1)




15




3.1
            
            Certificate
                of Incorporation of Entropin, Inc., a Delaware corporation
                (2)3.2
            
            Bylaws
                of Entropin, Inc., a Delaware corporation (2)3.3
            
            Certificate
                of Designations of Series A’ Preferred Stock of Entropin, Inc.
                (3)3.4
            
            Certificate
                of Amendment to Certificate of Incorporation (4)4.1
            
            Form
                of Common Stock Purchase Warrant (5)4.2
            
            Warrant
                for Common Stock issued to Navidec Financial Services, Inc.
                (6)10.1
            
            Agreement
                and Plan of Merger, dated December 9, 1997 between Vanden Capital
                Group,
                Inc. and Entropin, Inc. (7)10.2
            
            Lease
                Agreement, dated February 1, 1998, between the Registrant and Thomas
                T.
                Anderson (8)10.3
            
            1998
                Compensatory Stock Plan (9)10.4
            
            Employment
                Agreement, dated December 1, 1999, between Entropin, Inc. and Thomas
                Tachovsky. (10)10.5
            
            Amended
                and Restated Investment Banking Agreement, dated December 11, 2003,
                between Entropin, Inc. and InvestLinc Securities, LLC.
                (10)10.6
            
            Form
                of Indemnification Agreement for the officers and directors
                (11)31.1
            
            Certification
                of Chief Executive Officer31.2
            
            Certification
                of Chief Financial Officer32.1
            
            Certification
                of President and Chief Executive Officer under Section 906 of the
                Sarbanes-Oxley Act of 2002.32.2
            
            Certification
                of Chief Financial Officer under Section 906 of the Sarbanes-Oxley
                Act of
                2002.


___________




(1) Incorporated
      by reference to the like numbered exhibit filed with the Registrant’s quarterly
      report on Form 10-QSB on August 14, 2002.




(2) Incorporated
      by reference from the like numbered exhibits as filed with the Registrant’s
      Current Report on Form 8-K on June 26, 2002.




(3) Incorporated
      by reference from the like numbered exhibit as filed with the Registrant’s
      annual report on Form 10-KSB/A on April 30, 2003.




(4) Incorporated
      by reference from Exhibit A filed with the Registrant’s Proxy Statement on
      October 1, 2004.




(5) Incorporated
      by reference to the exhibit filed with the Registrant’s Registration Statement
      on Form SB-2/A, No. 333-11308, on March 15, 2000.




16




(6) Incorporated
      by reference from the exhibit as filed with the Registrant’s annual report on
      Form 10-KSB on March 30, 2004.




(7) Incorporated
      by reference from the exhibit filed with the Registrant’s Current Report on Form
      8-K, as amended, on January 15, 1998.




(8) Incorporated
      by reference from the exhibit filed with the Registrant’s Annual Report on Form
      10-KSB, on April 15, 1998, as amended.




(9) Incorporated
      by reference from exhibit filed with the Registrant’s Registration Statement on
      Form S-8 on December 30, 1998.




(10) Incorporated
      by reference to the exhibit filed with the Registrant’s Registration Statement
      on Form SB-2/A, No. 333-110159, on December 17, 2003.





(11)
      Incorporated by reference from Exhibit 10.1 as filed with the Registrant’s
      Current Report on Form 8-K filed on September 17, 2004.




**SIGNATURES**





In
      accordance with the requirements of the Exchange Act, the Company caused this
      report to be signed on its behalf by the undersigned, thereunto duly authorized.




ENTROPIN,
                INC., a Delaware corporationDate:
                April 25, 2006
            By:
                /s/ David
                NorrisDavid
                L.NorrisPresident,
                Chief Executive Officer
              Chief
                Financial Officer




17