**UNITED
      STATES**


**SECURITIES
      AND EXCHANGE COMMISSION**


Washington,
      D.C. 20549




**FORM
      10-QSB**




(Mark
      One)




x Quarterly
      Report Under Section 13 Or 15(d) Of The Securities Exchange Act Of
      1934




For
      quarterly period ended **December
      31, 2007**




 ̈ Transition
      Report Under Section 13 Or 15(d) Of The Securities Exchange Act Of 1934




For
      the
      transition period from _____ to _____




**COMMISSION
      FILE NUMBER** **033-24138-D**




**IMAGENETIX,
      INC.**


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




**NEVADA**
            
            **87-0463772**(State
                or other jurisdiction of incorporation or organization)
            
            (I.R.S.
                Employer Identification No.)





**10845
                Rancho Bernardo Road, Suite 105****San
                Diego, California 92127**(Address
                of principal executive offices)




Issuer's
      telephone number **(858)
      674-8455**




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**  ̈




Indicate
      by check mark whether the registrant is a shell company (as defined in Rule
      12b-2 of the Exchange Act).


Yes  ̈  **No** **x**




State
      the
      number of shares outstanding of each of the issuer's classes of common equity,
      as of the latest practicable date:




Common
                Stock, $.001 par
                value
            10,960,788(Class)
            Outstanding
                at February 13,
                2008




Transitional
      Small Business Disclosure Format (Check one): Yes  ̈  **No** **x**









**Imagenetix,
      Inc.**




**INDEX**





PagePART
                I.FINANCIAL
                INFORMATIONItem
                1.
            
            Financial
                Statements:Condensed
                Consolidated Balance Sheets as of December 31, 2007 (unaudited) and
                March
                31, 2007
            
            3Condensed
                Consolidated Statements of Operations for the three and nine months
                ended
                December 31, 2007 and 2006 (unaudited)
            
            4Condensed
                Consolidated Statements of Cash Flows for the nine months ended December
                31, 2007 and 2006 (unaudited)
            
            5Notes
                to Unaudited Condensed Consolidated Financial Statements
            
            6Item
                2.
            
            Management’s
                Discussion and Analysis or Plan of Operation
            
            11Item
                3.
            
            Controls
                and Procedures
            
            21PART
                II.OTHER
                INFORMATIONItem
                1.
            
            Legal
                Proceedings
            
            *Item
                2.
            
            Unregistered
                Sales of Equity Securities and Use of Proceeds
            
            *Item
                3.
            
            Defaults
                Upon Senior Securities
            
            *Item
                4.
            
            Submission
                of Matters to a Vote of Security Holders
            
            *Item
                5.
            
            Other
                Information
            
            *Item
                6.
            
            Exhibits
            
            21SIGNATURES





*  No
      information provided due to inapplicability of the item.




2




**PART
      I - FINANCIAL INFORMATION**




**Item
      1. Financial Statements**




**Imagenetix,
      Inc.**


**Condensed
      Consolidated Balance Sheets**





December
                31,
            
            March
                31,2007
            
            2007(Unaudited)ASSETSCurrent
                assets:Cash
                and cash equivalents
            
            $
            598,525
            
            $
            958,896Accounts
                receivable, net
            
            
            1,014,831
            
            
            1,576,641Inventories,
                net
            
            
            1,332,163
            
            
            1,284,458Prepaid
                expenses
            
            
            411,132
            
            
            384,217Income
                tax receivable
            
            
            191,857
            
            
            269,140Deferred
                tax asset
            
            
            592,197
            
            
            109,797Total
                current assets
            
            
            4,140,705
            
            
            4,583,149Property
                and equipment, net
            
            
            120,517
            
            
            125,456Other
                assets
            
            
            299,021
            
            
            551,998$
            4,560,243
            
            $
            5,260,603LIABILITIES
                AND STOCKHOLDERS' EQUITYCurrent
                liabilities:Accounts
                payable
            
            $
            592,245
            
            $
            368,089Accrued
                liabilities
            
            
            83,287
            
            
            64,265Customer
                deposits
            
            
            36,875
            
            
            136,645Contract
                payable
            
            
            69,300
            
            
            49,970Short
                term license payable
            
            
            33,583
            
            
            31,633Total
                current liabilities
            
            
            815,290
            
            
            650,602Long
                term license payable
            
            
            11,803
            
            
            37,239Total
                liabilities
            
            
            827,093
            
            
            687,841Stockholders'
                equityPreferred
                stock, $.001 par value; 5,000,000 sharesauthorized:
                none outstanding
            
            
            -
            
            
            -Common
                stock, $.001 par value; 50,000,000 sharesauthorized:
                10,960,788 and 10,871,400 issued andoutstanding
                at December 31and March 31, 2007
            
            
            10,960
            
            
            10,871Capital
                in excess of par value
            
            
            12,446,260
            
            
            10,734,945Accumulated
                deficit
            
            
            (8,724,070
            )
            
            (6,173,054
            )Total
                stockholders' equity
            
            
            3,733,150
            
            
            4,572,762$
            4,560,243
            
            $
            5,260,603





*See
      accompanying notes to unaudited condensed consolidated financial
      statements.*




3




**Imagenetix,
      Inc.**


**Condensed
      Consolidated Statements of Operations**


(Unaudited)





Three
                Months Ended
            
            Nine
                Months EndedDecember
                31,
            
            December
                31,
            
            December
                31,
            
            December
                31,2007
            
            2006
            
            2007
            
            2006Net
                sales
            
            $
            1,032,048
            
            $
            1,062,373
            
            $
            3,987,850
            
            $
            3,326,958Cost
                of sales
            
            
            646,973
            
            
            617,975
            
            
            2,266,833
            
            
            1,791,645Gross
                profit
            
            
            385,075
            
            
            444,398
            
            
            1,721,017
            
            
            1,535,313Operating
                expenses:General
                and administrative
            
            
            582,483
            
            
            362,867
            
            
            1,915,846
            
            
            913,763Payroll
                expense
            
            
            239,533
            
            
            166,040
            
            
            811,866
            
            
            531,765Consulting
                expense
            
            
            229,870
            
            
            352,590
            
            
            709,223
            
            
            1,019,983Operating
                expenses
            
            
            1,051,886
            
            
            881,497
            
            
            3,436,935
            
            
            2,465,511Operating
                income
            
            
            (666,811
            )
            
            (437,099
            )
            
            (1,715,918
            )
            
            (930,198
            )Other
                income (expense):Other
                income
            
            
            5,808
            
            
            5,101
            
            
            27,594
            
            
            22,089Interest
                expense
            
            
            (1,014
            )
            
            (1,626
            )
            
            (3,513
            )
            
            (5,313
            )Other
                income (expense)
            
            
            4,794
            
            
            3,475
            
            
            24,081
            
            
            16,776Loss
                before income taxes
            
            
            (662,017
            )
            
            (433,624
            )
            
            (1,691,837
            )
            
            (913,422
            )Income
                tax expense (benefit)
            
            
            (267,300
            )
            
            (152,210
            )
            
            (230,900
            )
            
            (222,725
            )Loss
            
            $
            (394,717
            )
            $
            (281,414
            )
            $
            (1,460,937
            )
            $
            (690,697
            )Basic
                and diluted loss per share
            
            $
            (0.04
            )
            $
            (0.03
            )
            $
            (0.13
            )
            $
            (0.06
            )Basic
                  and diluted weighted average common
                  shares outstanding
            
            
            10,953,283
            
            
            10,721,400
            
            
            10,912,565
            
            
            10,721,400





*See
      accompanying notes to unaudited condensed consolidated financial
      statements.*




4




**Imagenetix,
                Inc.****Consolidated
                Statements of Cash Flows**(Unaudited)




Nine
                Months Ended December 31,2007
            
            2006**Operating
                activities:**Net
                loss
            
            $
            (1,460,937
            )
            $
            (690,697
            )Adjustments
                  to reconcile net loss to
                  cash provided by (used in) operating
                  activities:Amortization
                and depreciation
            
            
            37,041
            
            
            29,775Provision
                for doubtful accounts
            
            
            30,000
            
            
            20,000Provision
                for inventory obsolescence
            
            
            12,134
            
            
            15,756Non
                  cash expense related to issuance of warrants and
                  granting of stock options
            
            
            374,901
            
            
            -Changes
                in assets and liabilities:(Increase)
                decrease in accounts receivable
            
            
            531,810
            
            
            (160,778
            )(Increase)
                decrease in inventory
            
            
            (59,839
            )
            
            (184,303
            )(Increase)
                decrease in other assets
            
            
            (38,527
            )
            
            56,728(Increase)
                decrease in deferred taxes
            
            
            (230,900
            )
            
            (112,538
            )Increase
                (decrease) in accounts payable
            
            
            224,157
            
            
            (147,846
            )Increase
                (decrease) in accrued liabilities
            
            
            19,022
            
            
            21,387Increase
                (decrease) in customer deposits
            
            
            (99,770
            )
            
            200,040Increase
                (decrease) in income taxes payable
            
            
            77,283
            
            
            276,746Net
                cash provided by (used in) operating activities
            
            
            (583,625
            )
            
            (675,730
            )**Investing
                activities:**Property
                and equipment
            
            
            (19,014
            )
            
            (28,793
            )Net
                cash used in investing activities
            
            
            (19,014
            )
            
            (28,793
            )**Financing
                activities:**Proceeds
                from exercise of warrants
            
            
            90,888
            
            
            -Proceeds
                from extension of warrants
            
            
            155,536
            
            
            -Proceeds
                from issuance of contracts payable
            
            
            19,330
            
            
            -Payments
                on patent license financed
            
            
            (23,486
            )
            
            (21,687
            )Net
                cash provided by (used in) financing activities
            
            
            242,268
            
            
            (21,687
            )**Net
                increase (decrease) in cash and cash equivalents**
            
            
            (360,371
            )
            
            (726,210
            )**Cash
                and cash equivalents**,
                beginning of period
            
            
            958,896
            
            
            1,808,016**Cash
                and cash equivalents,**end of period
            
            $
            598,525
            
            $
            1,081,806**Supplemental
                Disclosure of Cash Flow Information:**Cash
                paid during the period for:Interest
            
            $
            3,513
            
            $
            5,313Income
                taxes
            
            $
            -
            
            $
            -**Non
                Cash Investing and Financing Activities:**Non-cash
                dividend issued to certain warrant holders
            
            $
            1,090,079
            
            $
            107,396





*See
      accompanying notes to unaudited condensed consolidated financial
      statements.*




5




**IMAGENETIX,
      INC.**


**Notes
      to the Unaudited Condensed Consolidated Financial Statements**





**1.** **BASIS
          OF PRESENTATION**





The
      consolidated financial statements of Imagenetix, Inc. ("Imagenetix") presented
      herein have been prepared pursuant to the rules of the Securities and Exchange
      Commission for quarterly reports on Form 10-QSB and do not include all of the
      information and footnotes required by accounting principles generally accepted
      in the United States of America. These statements should be read in conjunction
      with our audited consolidated financial statements and notes thereto included
      in
      Form 10-KSB for the year ended March 31, 2007.





In
      the
      opinion of management, the interim consolidated financial statements reflect
      all
      adjustments of a normal recurring nature necessary for a fair statement of
      the
      results for interim periods. Operating results for the three and nine month
      periods are not necessarily indicative of the results that may be expected
      for
      the year.





**Earnings
      Per Share**





We
      follow
      Statement of Financial Accounting Standards ("SFAS") No. 128, "Earnings per
      Share." Under SFAS No. 128, basic earnings per share is calculated as earnings
      available to common stockholders divided by the weighted average number of
      common shares outstanding. Diluted earnings per share is calculated as net
      income divided by the diluted weighted average number of common shares. The
      diluted weighted average number of common shares is calculated using the
      treasury stock method for common stock issuable pursuant to outstanding stock
      options and common stock warrants.





**Stock
      Based Compensation**





Effective
      January 1, 2006, we adopted FASB Statement No. 123R, “Accounting for Stock-Based
      Compensation” (“SFAS 123R”). SFAS 123R requires all share-based payments to
      employees, including grants of employee stock options and restricted stock,
      to
      be recognized in the financial statements based on their fair values.





We
      have
      selected the Black-Scholes method of valuation for share-based compensation.
      The
      charge is recognized in non cash compensation, which is included in stock-based
      compensation expense, on a straight-line basis over the remaining service period
      based on the options’ original estimate of fair value.





We
      apply
      SFAS No. 123 in valuing options granted to consultants and estimate the fair
      value of such options using the Black-Scholes option-pricing model. The fair
      value is recorded as consulting expense as services are provided. Options
      granted to consultants for which vesting is contingent based on future
      performance are measured at their then current fair value at each period end,
      until vested.





**2.**  **RECENT
      ACCOUNTING PRONOUNCEMENTS**





In
      February 2007, the FASB issued SFAS No. 159, “The Fair Value Option for
      Financial Assets and Financial Liabilities”. This Statement permits entities to
      choose to measure many financial assets and financial liabilities at fair value.
      Unrealized gains and losses on items for which the fair value
      option has been elected are reported in earnings. SFAS No. 159 is effective
      for
      fiscal years beginning after November 15, 2007, which for us will be the
      fiscal year beginning April 1, 2008. We are currently assessing the impact
      of
      SFAS No. 159 on our financial position and results of
      operations.




6




**IMAGENETIX,
      INC.**


**Notes
      to the Unaudited Condensed Consolidated Financial Statements
      (Continued)**





In
      September 2006, the FASB issued SFAS No. 157, “Fair Value Measures”.
      This Statement defines fair value, establishes a framework for measuring fair
      value in generally GAAP, expands disclosures about fair value measurements,
      and
      applies under other accounting pronouncements that require or permit fair value
      measurements. SFAS No. 157 does not require any new fair value
      measurements. However, the FASB anticipates that for some entities, the
      application of SFAS No. 157 will change current practice. SFAS No. 157
      is effective for financial statements issued for fiscal years beginning after
      November 15, 2007, which for us will be the fiscal year beginning April 1,
      2008. We are currently evaluating the impact of SFAS No. 157 but do
      not expect that it will have a material impact on our financial statements.





**3.**  **ACCOUNTS
      RECEIVABLE**





Accounts
      receivable are carried at the expected realizable value. Accounts receivable
      consisted of the following:




December
                  31,
                2007
            
            March
                  31,
                2007Accounts
                receivable - trade
            
            $
            1,134,831
            
            $
            1,666,641Allowance
                for doubtful accounts
            
            
            (120,000
            )
            
            (90,000
            )Accounts
                receivable, net
            
            $
            1,014,831
            
            $
            1,576,641




At
      December 31, 2007, we had three customers which accounted for 24.0%, 15.4%,
      and
      13.6% of our accounts receivable balances.





For
      the
      nine months ended December 31, 2007, we had four significant customers which
      accounted for 24.5%, 16.0%, 13.3% and 10.8% of sales.




**4.**  **INVENTORY**





Inventory
      consists of the following:





December
                31,
            
            March
                31,2007
            
            2007Raw
                materials
            
            $
            894,429
            
            $
            797,498Finished
                products
            
            
            348,515
            
            
            401,895Boxes,
                labels, tubes & bottles
            
            
            236,441
            
            
            220,1531,479,385
            
            
            1,419,546Reserve
                for obsolescence
            
            
            (147,222
            )
            
            (135,088
            )$
            1,332,163
            
            $
            1,284,458




7




**IMAGENETIX,
        INC.**
 **Notes
        to the Unaudited Condensed Consolidated Financial Statements
        (Continued)**


**5.** **OTHER
          ASSETS**





The
      following is a summary of intangible assets which are included in “Other Assets”
on the face of the balance sheet:





December
                31,
            
            March
                31,2007
            
            2007Trademarks
            
            $
            13,032
            
            $
            13,032Patent
            
            
            172,965
            
            
            161,353Deferred
                tax asset
            
            
            163,600
            
            
            415,100349,597
            
            
            589,485Less
                accumulated amortization
            
            
            50,576
            
            
            37,487$
            299,021
            
            $
            551,998





**6.**  **EQUITY
      TRANSACTIONS**





During
      the nine months and quarter ended December 31, 2007, we offered warrant holders
      with warrants scheduled to expire on October 23, 2007, the right to extend
      their
      warrants for three additional years in exchange for a warrant extension fee
      of
      $0.05 per warrant share, such amount to be reduced from the existing exercise
      price, and a right for us to call the warrants should our common stock trade
      at
      a 20% premium to the revised exercise price for 10 business days. As a result
      of
      this offer, 53 warrants with exercise prices ranging from $0.75 to $2.00
      totaling 3,110,710 warrant shares were extended until October 23, 2010 at an
      accumulated fee of $155,536. We determined that the offering was a modification
      of warrants which were originally issued as part of equity transactions. We
      calculated the incremental fair value of the modified warrants by using the
      Black Sholes pricing model and recorded a non-cash dividend of $1,090,079 for
      the three and nine months ended December 31, 2007.





We
      recorded non-cash compensation expense for stock options issued to employees
      and
      consultants of $35,147 and $234,313 for the three and nine months ended December
      31, 2007. Also, we recorded non-cash general and administrative expense for
      warrants granted to individuals of none and $140,588 for the three and nine
      months ended December 31, 2007.





The
      significant assumptions used in the Black-Scholes model to estimate the non-cash
      dividend, compensation and general and administrative expense for the issuance
      of stock options and warrants during the three and nine months ended December
      31, 2007 are as follows:





Expected
                term of options and warrants
            
            3
                to 5 yearsExpected
                volatility
            
            55%
                to 71%Expected
                dividends
            
            NoneRisk-free
                interest rate
            
            3.09%
                to 4.55%Forfeitures
            
            0%





8




**IMAGENETIX,
      INC.**


**Notes
      to the Unaudited Condensed Consolidated Financial Statements
      (Continued)**





A
      summary
      of the options outstanding follows:




For
                the Nine Months EndedDecember
                31, 2007WeightedAverageExerciseOptions
            
            Shares
            
            PriceOutstanding
                at beginning of year
            
            
            1,129,000
            
            $
            1.74Granted
            
            
            350,000
            
            
            1.30Cancelled
            
            
            -
            
            
            -Exercised
            
            
            -
            
            
            -Outstanding
                at end of the period
            
            
            1,479,000
            
            
            1.64Exercisable
                at end of the the period
            
            
            1,304,000
            
            $
            1.68Weighted
                  average fair value of options granted
                  during the period
            
            
            350,000
            
            $
            0.80





As
      of
      December 31, 2007, the unamortized portion of stock compensation expense on
      all
      existing stock options was $46,863.





A
      summary
      of warrants outstanding follows:




For
                the Nine Months EndedDecember
                31, 2007WeightedAverageExerciseWarrants
            
            Shares
            
            PriceOutstanding
                at beginning of year
            
            
            4,357,100
            
            $
            1.26Granted
            
            
            175,000
            
            
            1.30Cancelled
            
            
            (539,755
            )
            
            1.59Exercised
            
            
            (89,388
            )
            
            1.02Outstanding
                at end of the period
            
            
            3,902,957
            
            
            1.18Exercisable
                at end of the the period
            
            
            3,902,957
            
            $
            1.18





**7.**  **INCOME
      TAXES**





We
      or one
      of our subsidiaries file income tax returns in the U.S. federal jurisdiction
      and
      the state of California. With few exceptions, we are no longer subject to U.S.
      federal, state and local or non-U.S. income tax examinations by tax authorities
      for years before 2004.





We
      adopted the provisions of FASB Interpretation No. 48, *Accounting
      for Uncertainty in Income Taxes,* on April
      1, 2007. As a result of the implementation of Interpretation 48, we did not
      recognize an increase in the liability for unrecognized tax benefits. No
      unrecognized tax benefits are being reported for the three or nine months ended
      December 31, 2007.




9





Included
      in the balance at April 1, 2007, are no tax positions for which the
      ultimate deductibility is highly certain but for which there is uncertainty
      about the timing of such deductibility. Because of the impact of deferred tax
      accounting, other than interest and penalties, the disallowance of the shorter
      deductibility period would not affect the annual effective tax rate but would
      accelerate the payment of cash to the taxing authority to an earlier period.





Our
      policy is to recognize interest accrued related to unrecognized tax benefits
      in
      interest expense and penalties in operating expenses.




10




**ITEM
      2.     MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF
      OPERATION.**





THE
      FOLLOWING DISCUSSION INCLUDES FORWARD-LOOKING STATEMENTS WITH RESPECT TO OUR
      FUTURE FINANCIAL PERFORMANCE. ACTUAL RESULTS MAY DIFFER MATERIALLY FROM THOSE
      CURRENTLY ANTICIPATED AND FROM HISTORICAL RESULTS DEPENDING UPON A VARIETY
      OF
      FACTORS, INCLUDING THOSE DESCRIBED BELOW UNDER THE SUB-HEADING, "RISK FACTORS."
      SEE ALSO OUR ANNUAL REPORT ON FORM 10-KSB FOR THE YEAR ENDED MARCH 31,
      2007.




**Overview**




We
      develop, formulate and market over-the-counter, natural-based nutritional
      supplements and skin care products. Our products are proprietary, often
      supported by scientific studies which we request and are offered through
      multiple channels of distribution, including direct marketing companies, also
      known as network marketing or multi-level marketing companies, and chain store
      retailers. Our primary product is Celadrin® a product formulation which we sell
      to the mass market through retailers and on a private label basis to wholesale
      customers.





A
      key
      part of our marketing strategy is to provide to our wholesale customers a
      "turnkey" approach to the marketing and distribution of our products. This
      turnkey approach provides these customers with all the services necessary to
      market our products, including developing specific product formulations,
      providing supporting scientific studies regarding the effectiveness of the
      product and arranging for the manufacture and marketing of the product.





We
      sell
      directly to the mass markets through retailers InflameAway, our own Celadrin®
branded product. We also develop and sell products and formulations to
      businesses and organizations that market these products through multiple
      channels of distribution, including direct marketing companies, mass marketing
      companies, medical, health and nutritional professionals, medical newsletters
      and direct response radio and television. We also offer Celadrin® products
      through wholesale customers that in turn offer their products containing
      Celadrin® to mass market retailers.





Management's
      discussion and analysis or plan of operation is based upon the Company's
      financial statements. These statements have been prepared in accordance with
      accounting principles generally accepted in the United States of America. These
      principles require management to make certain estimates, judgments and
      assumptions that affect the reported amounts of assets, liabilities, revenues
      and expenses, and related disclosure of contingent assets and liabilities.
      On an
      on-going basis, we evaluate our estimates based on historical experience and
      various other assumptions that are believed to be reasonable under the
      circumstances, the results of which form the basis for making judgments about
      the carrying values of assets and liabilities that are not readily apparent
      from
      other sources. Actual results may differ from these estimates under different
      assumptions or conditions .





**Critical
      Accounting Policies and Estimates**





We
      have
      identified four accounting principles that we believe are key to an
      understanding of our financial statements. These important accounting policies
      require management's most difficult, subjective judgments .





*1.*  *Accounts receivable.*




Accounts
      receivable are carried at the expected net realizable value. The allowance
      for
      doubtful accounts is based on management’s assessment of the collectibility of
      specific customer accounts and the aging of the accounts receivable. If there
      were a deterioration of a major customer’s creditworthiness, or actual defaults
      were higher than historical experience, our estimates of the recoverability
      of
      amounts due to us could be overstated, which could have a negative impact on
      operations.




11





*2.
      Inventory*




Inventory
      is carried at the lower of cost or market. Cost is determined by the first-in
      first-out method. At each period end, management adjusts the inventory allowance
      based on estimates. These estimates take into account spoilage, yields,
      obsolescence and overstocked inventory amounts.





*3.
      Revenue Recognition*




We
      recognize revenue in accordance with the SEC’s Staff Accounting Bulletin
      No. 104, “Revenue Recognition in Financial Statements” (SAB104), Statement
      of Financial Accounting Standards No. 48, “Revenue Recognition When Right
      of Return Exists” (SFAS 48), and Emerging Issues Task Force Abstract (EITF)
      No. 01-9, “Accounting for Consideration Given by a Vendor to a Customer
      (Including a Reseller of the Vendor’s Products.” SAB 104 requires that four
      basic criteria be met before revenue can be recognized: 1) there is evidence
      that an arrangement exists; 2) delivery has occurred; 3) the fee is fixed or
      determinable; and 4) collectibility is reasonably assured. SFAS 48 states that
      revenue from sales transactions where the buyer has the right to return the
      product shall be recognized at the time of sale only if (1) the seller’s
      price to the buyer is substantially fixed or determinable at the date of sale;
      (2) the buyer has paid the seller, or the buyer is obligated to pay the
      seller and the obligation is not contingent on  resale of the product;
      (3) the buyer’s obligation to the seller would not be changed in the event
      of theft or physical destruction or damage of the product; (4) the buyer
      acquiring the product for resale has economic substance apart from that provided
      by the seller; (5) the seller does not have significant obligations for
      future performance to directly bring about resale of the product by the buyer;
      and (6) the amount of future returns can be reasonably estimated. We
      recognize revenue upon determination that all criteria for revenue recognition
      have been met. The criteria are usually met at the time title passes to the
      customer, which usually occurs upon shipment. Revenue from shipments where
      title
      passes upon delivery is deferred until the shipment has been delivered.




We
      account for payments made to customers in accordance with EITF 01-09, which
      states that cash consideration (including a sales incentive) given by a vendor
      to a customer is presumed to be a reduction of the selling prices of the
vendor’s products or services and, therefore, should be characterized as a
      reduction of revenue when recognized in the vendor’s income statement, rather
      than a sales and marketing expense. We have various agreements with customers
      that provide for discounts and rebates. These agreements are classified as
      a
      reduction of revenue. Certain other costs associated with customers that meet
      the requirements of EITF 01-09 are recorded as sales and marketing expense.




We
      guarantee customer satisfaction. Our policy requires the customer to return
      the
      unused product to the retailer from whom they originally purchased it. We pay
      the retailer for the returned product plus a handling cost. We periodically
      assess the adequacy of this policy and will record a liability as necessary.
      For
      the three and nine months ended December 31, 2007, there were no returns that
      would suggest a liability needed to be recorded.




We
      review
      gross revenue for estimated returns of private label contract manufacturing
      products and direct-to-consumer products. The estimated returns are based upon
      the trailing six months of private label contract manufacturing gross sales
      and
      our historical experience for both private label contract manufacturing and
      direct-to-consumer product returns. However, the estimate for product returns
      does not reflect the impact of a large product recall resulting from product
      nonconformance or other factors as such events are not predictable nor is the
      related economic impact estimable. For the three and nine months ended December
      31, 2007, there were no returns that would suggest a liability needed to be
      recorded.




As
      part
      of the services we provide to our private label contract manufacturing
      customers, we may perform, but are not required to perform, certain research
      and
      development activities related to the development or improvement of their
      products. While our customers typically do not pay directly for this service,
      the cost of this service is included as a component of the price we charge
      to
      manufacture and deliver their products.





*4.
      Income Taxes*




Deferred
      income taxes are provided using the liability method whereby deferred tax assets
      are recognized for deductible temporary differences and operating loss and
      tax
      credit carry-forwards and deferred tax liabilities are recognized for taxable
      temporary differences. Temporary differences are the differences between the
      reported amounts of assets and liabilities and their tax bases. Deferred tax
      assets are reduced by a valuation allowance when, in the opinion of management,
      it is more likely than not that some portion or all of the deferred tax assets
      will not be realized. Deferred tax assets and liabilities are adjusted for
      the
      effects of the changes in tax laws and rates as of the date of
      enactment.




12





When
      tax
      returns are filed, it is highly certain that some positions taken would be
      sustained upon examination by the taxing authorities, while others are subject
      to uncertainty about the merits of the position taken or the amount of the
      position that would be ultimately sustained. The benefit of a tax position
      is
      recognized in the financial statements in the period during which, based on
      all
      available evidence, management believes it is more likely than not that the
      position will be sustained upon examination, including the resolution of appeals
      or litigation processes, if any. Tax positions taken are not offset or
      aggregated with other portions. Tax positions that meet the more-likely-than-not
      recognition threshold are measured as the largest amount of tax benefit that
      is
      more than 50 percent likely of being realized upon settlement with the
      applicable taxing authority. The portion of the benefits associated with the
      tax
      positions taken that exceed the amount measured as described above is reflected
      as a liability for unrecognized tax benefits in the accompanying balance sheet
      along with any associated interest and penalties that would be payable to the
      taxing authorities upon examination.




**Selected
      Financial Information**




**Results
      of Operations**




*Three
      Months Ended December 31, 2007 Compared to Three Months Ended December 31,
      2006*




Three
                Months Ended12/31/07
            
            12/31/06
            
            Increase
              (Decrease)
            
            %Statements
                of Operations:Net
                sales
            
            $
            1,032,000
            
            $
            1,062,000
            
            $
            (30,000
            )
            
            -2.8
            %Cost
                of goods sold
            
            
            647,000
            
            
            618,000
            
            
            29,000
            
            
            4.7
            %%
                of net sales
            
            
            63
            %
            
            58
            %
            
            5
            %
            
            7.7
            %Gross
                profit
            
            
            385,000
            
            
            444,000
            
            
            (59,000
            )
            
            -13.3
            %%
                of net sales
            
            
            37
            %
            
            42
            %
            
            -5
            %
            
            -10.8
            %Operating
                expensesGeneral
                and administrative
            
            
            582,000
            
            
            363,000
            
            
            219,000
            
            
            60.3
            %Payroll
                expense
            
            
            240,000
            
            
            166,000
            
            
            74,000
            
            
            44.6
            %Consulting
                expense
            
            
            230,000
            
            
            352,000
            
            
            (122,000
            )
            
            -34.7
            %Total
                operating expenses
            
            
            1,052,000
            
            
            881,000
            
            
            171,000
            
            
            19.4
            %Interest
                expense
            
            
            (1,000
            )
            
            (1,000
            )
            
            -
            
            
            0.0
            %Other
                income
            
            
            6,000
            
            
            5,000
            
            
            1,000
            
            
            20.0
            %Provision
                for (benefit from) taxes
            
            
            (267,000
            )
            
            (152,000
            )
            
            (115,000
            )
            
            75.7
            %Net
                income (loss)
            
            
            (395,000
            )
            
            (281,000
            )
            
            (114,000
            )
            
            40.6
            %Net
                income (loss) per share basic
            
            
            (0.04
            )
            
            (0.03
            )
            
            (0.01
            )
            
            33.3
            %Net
                income (loss) per share diluted
            
            
            (0.04
            )
            
            (0.03
            )
            
            (0.01
            )
            
            33.3
            %




Net
      Sales




Net
      sales
      for the quarter ended December 31, 2007 remained stable at $1,032,000 compared
      to $1,062,000 for the quarter ended December 31, 2006. Sales increases continued
      related to our own product, Inflame Away, that identifies Celadrin â as its
      marquee ingredient. Sales incentives and rebates contributed to direct mass
      market revenue. We anticipate, if the new marketing program continues to
      successfully penetrate the market, that Inflame Away will result in improved
      sales for the balance of our fiscal year.




13




Cost
      of Goods Sold




Cost
      of
      goods sold as a percentage of net sales increased from 58% for the quarter
      ended
      December 31, 2006 to 63% for the quarter ended December 31, 2007. This increase
      was primarily due to the effect of Inflame Away sales incentives and rebates
      on
      the cost of goods sold percentage. We anticipate the cost of goods sold as
      a
      percentage of net sales will decrease proportionately to the increase in sales
      of Inflame Away to the mass markets.




General
      and Administrative




General
      and administrative expenses increased by $219,000, a 60.3% increase, to $582,000
      for the quarter ended December 31, 2007 from $363,000 for the quarter ended
      December 31, 2006. The primary reason for the increase were an approximate
      $223,000 increase in advertising expenses related to the launch of InflameAway
      and an approximate $64,000 increase in marketing expenses related to a mail
      in
      rebate program at a major retail chain partially offset by an approximate
      $110,000 decrease in expenses related to clinical research studies. We
      anticipate increases in general and administrative expenses as a result of
      our
      advertising campaign for our Inflame Away product.




Payroll
      Expense




Payroll
      expense increased approximately $74,000, a 44.6% increase, to $240,000 for
      the
      quarter ended December 31, 2007 compared to $166,000 for the quarter ended
      December 31, 2006. This increase was due primarily to a $35,000 charge to
      non-cash compensation for the amortization of employee stock options coupled
      with normal payroll increases.




Consulting
      Expenses




Consulting
      expenses decreased to $122,000 for the quarter ended December 31, 2007, a
      decrease of 34.7% or $230,000 compared to $352,000 for the quarter ended
      December 31, 2006. This decrease was a result of the termination of several
      consulting agreements coupled with a reduction in legal fees. We anticipate
      consulting fees will remain stable during the remainder of our fiscal
      year.




Provision
      for Income Taxes




As
      a
      result of losses sustained in each reporting period, an income tax benefit
      of
      $267,000 was recognized for the quarter ended December 31, 2007 compared to
      $152,000 for the quarter ended December 31, 2006.




14




*Nine
      months ended December 31, 2007 Compared to Nine months ended December 31,
      2006*




Nine
                Months Ended12/31/07
            
            12/31/06
            
            Increase
              (Decrease)
            
            
            %Statements
                of Operations:Net
                sales
            
            $
            3,988,000
            
            $
            3,327,000
            
            $
            661,000
            
            
            19.9
            %Cost
                of goods sold
            
            
            2,267,000
            
            
            1,792,000
            
            
            475,000
            
            
            26.5
            %%
                of net sales
            
            
            57
            %
            
            54
            %
            
            3
            %
            
            5.5
            %Gross
                profit
            
            
            1,721,000
            
            
            1,535,000
            
            
            186,000
            
            
            12.1
            %%
                of net sales
            
            
            43
            %
            
            46
            %
            
            -3
            %
            
            -6.5
            %Operating
                expensesGeneral
                and administrative
            
            
            1,916,000
            
            
            914,000
            
            
            1,002,000
            
            
            109.6
            %Payroll
                expense
            
            
            812,000
            
            
            532,000
            
            
            280,000
            
            
            52.6
            %Consulting
                expense
            
            
            709,000
            
            
            1,020,000
            
            
            (311,000
            )
            
            -30.5
            %Total
                operating expenses
            
            
            3,437,000
            
            
            2,466,000
            
            
            971,000
            
            
            39.4
            %Interest
                expense
            
            
            (4,000
            )
            
            (5,000
            )
            
            1,000
            
            
            -20.0
            %Other
                income
            
            
            28,000
            
            
            22,000
            
            
            6,000
            
            
            27.3
            %Provision
                for (benefit from) taxes
            
            
            (231,000
            )
            
            (223,000
            )
            
            (8,000
            )
            
            3.6
            %Net
                income (loss)
            
            
            (1,461,000
            )
            
            (691,000
            )
            
            (770,000
            )
            
            111.4
            %Net
                income (loss) per share basic
            
            
            (0.13
            )
            
            (0.06
            )
            
            (0.06
            )
            
            100.0
            %Net
                income (loss) per share diluted
            
            
            (0.13
            )
            
            (0.06
            )
            
            (0.06
            )
            
            100.0
            %




Net
      Sales




Net
      sales
      for the nine months ended December 31, 2007 increased $661,000, a 19.9%
      increase, to $3,988,000 compared to $3,327,000 for the nine months ended
      December 31, 2006. The primary reason for the sales increase was new
      distribution channels for foreign sales which contributed approximately
      $660,000. We anticipate, if the mass market marketing program continues to
      successfully penetrates the market, that Inflame Away will result in improved
      sales for the balance of our fiscal year.




Cost
      of Goods Sold




Cost
      of
      goods sold as a percentage of net sales increased from 54% for the nine months
      ended December 31, 2006 to 57% for the nine months ended December 31, 2007.
      This
      increase was primarily due to the effect of Inflame Away sales incentives and
      rebates on the cost of goods sold percentage. We anticipate the cost of goods
      sold as a percentage of net sales will decrease proportionately to the increase
      in sales of Inflame Away to the mass markets.




General
      and Administrative




General
      and administrative expenses increased by $1,002,000, a 109.6% increase, to
      $1,916,000 for the nine months ended December 31, 2007 from $914,000 for the
      nine months ended December 31, 2006. The primary reasons for the increase were
      an approximate $773,000 increase in advertising expenses related to the launch
      of InflameAway, an approximate $251,000 marketing expense related to a mail
      in
      rebate program at a major retail chain, an approximate $140,000 increase to
      non-cash expenses related to the issuance of warrants to individuals involved
      in
      the marketing of InflameAway offset by a $120,000 decrease in clinical research
      studies. We anticipate increases in general and administrative expenses as
      a
      result of our advertising campaign for our Inflame Away product and an increase
      in clinical research studies.




15




Payroll
      Expense




Payroll
      expense increased to $812,000 for the nine months ended December 31, 2007,
      an
      increase of 52.6% or $280,000, compared to $532,000 for the nine months ended
      December 31, 2006. This increase was a result of expensing approximately
      $232,000 as non-cash compensation the value of stock options granted to
      employees and consultants. We anticipate payroll to decrease in subsequent
      periods since the amortization of the value of the stock options over their
      vesting period will result in lower non-cash compensation compared to the
      current period.




Consulting
      Expenses




Consulting
      expenses decreased to $709,000 for the nine months ended December 31, 2007,
      a
      decrease of 30.5% or $311,000 compared to $1,020,000 for the nine months ended
      December 31, 2006. This decrease was a result of the termination of several
      consulting agreements coupled with a reduction in legal and accounting costs.
      We
      anticipate consulting fees will remain stable during the remainder of our fiscal
      year.




Provision
      for Income Taxes




An
      income
      tax benefit of $267,000 was recognized during the current period compared to
      $152,000 being recognized during the nine months ended December 31, 2006. If
      we
      incur a taxable loss for the current fiscal year, we will be able to carry
      forward as a deferred tax asset the amount of the tax benefit for federal and
      state tax purposes.




16




**Capital
      Resources**




Working
      Capital




12/31/07
            
            3/31/07
            
            Increase
              (Decrease)Current
                assets
            
            $
            4,140,705
            
            $
            4,583,149
            
            $
            (442,444
            )Current
                liabilities
            
            
            815,290
            
            
            650,602
            
            
            164,688Working
                capital
            
            $
            3,325,415
            
            $
            3,932,547
            
            $
            (607,132
            )Long-term
                debt
            
            $
            11,803
            
            $
            37,239
            
            $
            (25,436
            )Stockholders'
                equity
            
            $
            3,733,150
            
            $
            4,572,762
            
            $
            (839,612
            )




Statements
        of Cash Flows Select Information




Nine
                Months Ended12/31/07
            
            12/31/06
            
            
            Increase
              (Decrease)Net
                cash provided by (used in):Operating
                activities
            
            $
            (583,625
            )
            $
            (675,730
            )
            $
            92,105Investing
                activities
            
            $
            (19,014
            )
            $
            (28,793
            )
            $
            9,779Financing
                activities
            
            $
            242,268
            
            $
            (21,687
            )
            $
            263,955




Balance
        Sheet Select Information


12/31/07
            
            3/31/07
            
            Increase
              (Decrease)Cash
                and cash equivalients
            
            $
            598,525
            
            $
            958,896
            
            $
            (360,371
            )Accounts
                receivable, net
            
            $
            1,014,831
            
            $
            1,576,641
            
            $
            (561,810
            )Inventory,
                net
            
            $
            1,332,163
            
            $
            1,284,458
            
            $
            47,705Accounts
                payable and accrued expenses
            
            $
            675,532
            
            $
            432,354
            
            $
            243,178




**Liquidity**




We
      have
      historically financed our operations internally and through debt and equity
      financings. At December 31, 2007, we had cash holdings of $598,525, a decrease
      of $360,371 compared to March 31, 2007. Our net working capital position at
      December 31, 2007, was $3,325,415 compared to $3,932,547 as of March 31, 2007.
      We have initiated a direct mass market strategy with our own product, Inflame
      Away. Although, a significant portion of our working capital may be needed
      to
      implement this strategy, we believe that our cash position is sufficient to
      fund
      our operating activities for at least the next 12 months.





**New
      Accounting Pronouncements**





In
      February 2007, the FASB issued SFAS No. 159, “The Fair Value Option for
      Financial Assets and Financial Liabilities”. This Statement permits entities to
      choose to measure many financial assets and financial liabilities at fair value.
      Unrealized gains and losses on items for which the fair value option has


been
      elected are reported in earnings. SFAS No. 159 is effective for fiscal years
      beginning after November 15, 2007, which for us will be the fiscal year
      beginning April 1, 2008. We are currently assessing the impact of SFAS No.
      159
      on our financial position and results of operations.




17




In
      September 2006, the FASB issued SFAS No. 157, “Fair Value Measures”.
      This Statement defines fair value, establishes a framework for measuring fair
      value in generally GAAP, expands disclosures about fair value measurements,
      and
      applies under other accounting pronouncements that require or permit fair value
      measurements. SFAS No. 157 does not require any new fair value
      measurements. However, the FASB anticipates that for some entities, the
      application of SFAS No. 157 will change current practice. SFAS No. 157
      is effective for financial statements issued for fiscal years beginning after
      November 15, 2007, which for us will be the fiscal year beginning April 1,
      2008. We are currently evaluating the impact of SFAS No. 157 but do
      not expect that it will have a material impact on our financial statements.




**Risk
      Factors**




You
      should consider the following discussion of risks as well as other information
      regarding our common stock. The risks and uncertainties described below are
      not
      the only ones. Additional risks and uncertainties not presently known to us
      or
      that we currently deem immaterial also may impair our business operations.
      If
      any of the following risks actually occur, our business could be harmed.





**There
      Is Only One Supplier for Celadrin®. If We Are Unable to Purchase Celadrin® from
      This Supplier, Our Business Would Be Harmed.**





There
      is
      only one supplier for Celadrin®, which we use in approximately 69% of our
      products and which represented approximately 75% of our sales for the year
      ended
      March 31, 2007. We will rely upon Celadrin® to expand our product lines and
      revenue in the future. If our Celadrin® supplier goes out of business or elects
      for any reason not to supply us with Celadrin®, we would have to find another
      Celadrin® supplier or suffer a significant reduction in our
      revenue.




**We
      Rely upon a Limited Number of Customers the Loss of Which Would Reduce Our
      Revenue and Any Earnings.**





Our
      two
      largest customers accounted for 23% and 15% of our net sales for the year ended
      March 31, 2007. The loss of these customers could significantly reduce our
      revenue and adversely affect our cash flow and earnings, if any.





**We
      Rely upon Other Outside Suppliers to Produce Our Products Which Could Delay
      Our
      Product Deliveries.**





All
      of
      our products are produced by outside manufacturers who process ingredients
      provided to them by our suppliers and with whom we have contracts. Our profit
      margins and our ability to deliver products on a timely basis are dependent
      upon
      these manufacturers and suppliers. Should any of these manufacturers or
      suppliers fail to provide us with product, we would be required to obtain new
      manufacturers and suppliers, which would be costly and time consuming and could
      delay our product deliveries.





**Product
      Liability Claims Against Us Could Be Costly.**





Some
      of
      our nutritional supplements contain newly-introduced ingredients or combinations
      of ingredients, and we have little long-term health information about
      individuals consuming those ingredients. If any of these products were thought
      or proved to be harmful, we could be subject to litigation. Although we carry
      product liability insurance in the face amount of $1,000,000 per occurrence
      and
      $2,000,000 in the aggregate and require our suppliers and manufacturers to
      include us as insured parties on their product liability insurance policies,
      our
      coverage may not be adequate to protect us from potential product liability
      claims and costs of defense.




18




**We
      Are Subject to Intense Competition from Other Nutritional Supplement Marketers
      Which Could Reduce Our Revenue and Profit Margins.**





Competition
      in the nutritional supplement market is intense. We compete with numerous
      companies that have longer operating histories, more products and greater name
      recognition and financial resources than we do. In order to compete, we could
      be
      forced to lower our product prices, which would reduce our revenue and profit
      margins.





**We
      Are Highly Regulated, Which Increases Our Costs of Doing Business.**





We
      are
      subject to laws and regulations which cover:





·
            the
                formulation, manufacturing, packaging, labeling, distribution,
                importation, sale and storage of our products;





·
            the
                health and safety of food and drugs;





·
            trade
                practice and direct selling laws; and





·
            product
                claims and advertising by us; or for which we may be held
                responsible.





Compliance
      with these laws and regulations is time consuming and expensive. Moreover,
      new
      regulations could be adopted that would severely restrict the products we sell
      or our ability to continue our business. We are unable to predict the nature
      of
      any future laws, regulations, interpretations or applications, nor can we
      predict what effect additional governmental regulations or administrative
      orders, when and if promulgated, would have on our business in the future.
      These
      future changes could, however, require the reformulation or elimination of
      certain products; imposition of additional record keeping and documentation
      requirements; imposition of new federal reporting and application requirements;
      modified methods of importing, manufacturing, storing or distributing certain
      products; and expanded or different labeling and substantiation requirements
      for
      certain products and ingredients. Any or all of these requirements could harm
      our business.





**There
      Are Limitations on the Liability of Our Officers and Directors Which May
      Restrict Our Stockholders from Bringing Claims.**





Our
      Bylaws substantially limit the liability of our officers and directors to us
      and
      our stockholders for negligence and breach of fiduciary or other duties to
      us.
      This limitation may prevent stockholders from bringing claims against our
      officers and directors in the future.





**Shares
      of Our Common Stock Which Are Eligible for Sale by Our Stockholders May Decrease
      the Price of Our Common Stock.**





We
      have
      10,960,788 common shares outstanding, of which 10,810,642 are freely tradable
      or
      saleable under Rule 144. We also have outstanding common stock warrants and
      stock options exercisable into up to 5,921,858 shares of common stock which
      could become free trading if exercised. If our stockholders sell substantial
      amounts of our common stock, the market price of our common stock could
      decrease.




19





**There
      is a Limited but Potentially Volatile Trading Market in Our Common Stock, Which
      May Adversely Affect Our Stock Price.**





Our
      common stock trades on the Electronic Bulletin Board. The Bulletin Board tends
      to be highly illiquid, in part because there is no national quotation system
      by
      which potential investors can track the market price of shares except through
      information received or generated by a limited number of broker-dealers that
      make a market in particular stocks. There is a greater chance of market
      volatility for securities that trade on the Bulletin Board as opposed to a
      national exchange or quotation system. This volatility may be caused by a
      variety of factors, including:





·
            The
                lack of readily available price quotations;





·
            The
                absence of consistent administrative supervision of "bid" and "ask"
                quotations;





·
            Lower
                trading volume; and





·
            Market
                conditions.





There
      could be wide fluctuations in the market price of our common stock. These
      fluctuations may have an extremely negative effect on the market price of our
      securities and may prevent you from obtaining a market price equal to your
      purchase price when you attempt to sell our securities in the open market.
      In
      these situations, you may be required to either sell our securities at a market
      price which is lower than your purchase price, or to hold our securities for
      a
      longer period of time than you planned.





**Because
      Our Common Stock May Be Classified as "Penny Stock," Trading in it Could Be
      Limited, and Our Stock Price Could Decline.**





In
      the
      future, our common stock may fall under the definition of "penny stock" if
      our
      net tangible assets decline below $2,500,000. In such event, trading in our
      common stock would be limited because broker-dealers will be required to provide
      their customers with disclosure documents prior to allowing them to participate
      in transactions involving our common stock. These disclosure requirements are
      burdensome to broker-dealers and may discourage them from allowing their
      customers to participate in transactions involving our common stock.





"Penny
      stocks" are equity securities with a market price below $5.00 per share, other
      than a security that is registered on a national exchange or included for
      quotation on the NASDAQ system, unless, as in our case, the issuer has net
      tangible assets of more than $2,000,000 and has been in continuous operation
      for
      greater than three years. Issuers who have been in operation for less than
      three
      years must have net tangible assets of at least $5,000,000.





Rules
      promulgated by the Securities and Exchange Commission under Section 15(g) of
      the
      Exchange Act require broker-dealers engaging in transactions in penny stocks,
      to
      first provide to their customers a series of disclosures and documents,
      including:





·
            A
                standardized risk disclosure document identifying the risks inherent
                in
                investment in pennystocks;





·
            All
                compensation received by the broker-dealer in connection with the
                transaction;





·
            Current
                quotation prices and other relevant market data; and





·
            Monthly
                account statements reflecting the fair market value of the securities.
                In
                addition, theserules
                require that a broker-dealer obtain financial and other information
                from a
                customer, determine that transactions in penny stocks are suitable
                for
                such customer and deliver a written statement to such customer setting
                forth the basis for this determination.




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**ITEM
      3.     CONTROLS AND PROCEDURES.**




(a)
            Evaluation
                of disclosure controls and procedures. Our Chief Executive Officer
                and
                Principal Financial Officer, after evaluating the effectiveness of
                our
                "disclosure controls and procedures" (as defined in the Securities
                Exchange Act of 1934 Rules 13a-15(e) and 15d-15(e)) as of the end
                of the
                period covered by this Quarterly Report on Form 10-QSB (the "Evaluation
                Date"), have concluded that as of the Evaluation Date, our disclosure
                controls and procedures are effective to provide reasonable assurance
                that
                information we are required to disclose in reports that we file or
                submit
                under the Exchange Act is recorded, processed, summarized and reported
                within the time periods specified in the Securities and Exchange
                Commission rules and forms, and that such information is accumulated
                and
                communicated to our management, including our Chief Executive Officer
                and
                Principal Financial Officer, as appropriate, to allow timely decisions
                regarding required disclosure.





(b)
            Changes
                in internal control over financial reporting. There were no changes
                in our
                internal control over financial reporting during our most recent
                fiscal
                quarter that materially affected, or were reasonably likely to materially
                affect, our internal control over financial
                reporting.




**PART
      II.**  **OTHER
      INFORMATION**




**ITEM
      6.****EXHIBITS.**




**Exhibit
                No.**
            
            **Title******31.1
            
            302
                Certification of William P. Spencer, Chief Executive
                Officer31.2
            
            302
                Certification of Lowell W. Giffhorn, Chief Financial
                Officer32.1
            
            906
                Certification of William P. Spencer, Chief Executive
                Officer32.2
            
            906
                Certification of Lowell W. Giffhorn, Chief Financial
                Officer




21




**SIGNATURES**




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




IMAGENETIX,
                INC.
              a Nevada corporationDate:
              February 13, 2008
            By:
            /s/ WILLIAM
              P. SPENCERWilliam P. Spencer
              Chief Executive Officer(Principal
                Executive Officer and duly authorized
              to sign on behalf of the
                Registrant)




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