**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 September 30, 2005
 
  ̈  **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**
                **incorporation
                  or organization)**
              **(IRS
                  employer**
                **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  ̈
 
 Indicate
        by check mark whether the Registrant is a shell company (as defined in Rule
        12b-2 of the Exchange Act.):      Yes x No  ̈
 As
          of
          November 15, 2005, 30,645,341 shares of the issuer’s Common Stock, $.0001 par
          value per share, were outstanding.
 
 Transitional
          Small Business Disclosure Format Yes  ̈ No x


**INDEX**
  **PART I.**
                **FINANCIAL
                    INFORMATION**Item 1.
                Financial
                    StatementsBalance
                    Sheets - December 31, 2004 and September 30, 2005
                    (unaudited)
                2Statements
                    of Operations - For the Three Months Ended September 30, 2004
                    and 2005
                    (unaudited)
                3Statements
                    of Operations - For the Nine Months Ended September 30, 2004
                    and 2005 (and
                    for the Period from August 27, 1984 (Inception) through September
                    30, 2005
                    (unaudited)
                4Statement
                    of Changes in Stockholders’ Equity - For the Nine Months Ended September
                    30, 2005 (unaudited)
                5Statements
                    of Cash Flows - For the Nine Months Ended September 30, 2004
                    and 2005 and
                    for the Period from August 27, 1984 (Inception) through September
                    30, 2005
                    (unaudited)
                6Notes
                    to Financial Statements (unaudited)
                8Item
                    2.
                Management’s
                    Discussion and Analysis of Financial Condition and Results of
                    Operations
                11Item
                    3.
                Controls
                    and Procedures
                16**PART II.**
                **OTHER
                    INFORMATION**Item
                    1.
                Legal
                    Proceedings
                17Item
                    2.
                Unregistered
                    Sales of Equity Securities and Use of Proceeds
                17Item
                    3.
                Defaults
                    upon Senior Securities
                17Item
                    4.
                Submission
                    of Matters to a Vote of Security Holders
                17Item
                    5.
                Other
                    Information
                17Item
                    6.
                Exhibits
                18Signatures
                19
 
 
 
 
 **ENTROPIN,
          INC.**
 **(A
          DEVELOPMENT STAGE COMPANY)**
 **BALANCE
          SHEETS**
 **December
          31, 2004 and September 30, 2005**
  **December
                    31,**
                  **2004**
                
                **September
                    30,**
                  **2005****(Unaudited)****ASSETS**Current
                    assets:Cash
                    and cash equivalents
                
                $
                444,611
                
                $
                146,403Short-term
                    investments
                
                
                1,273,000
                
                
                —Total
                    current assets
                
                
                1,717,611
                
                
                146,403Patent
                    costs, less accumulated amortization of $252,143 (2004) and $724,290
                    (2005)
                
                
                674,102
                
                
                —Property
                    and equipment, net
                
                
                1,906
                
                
                —Total
                    assets
                
                $
                2,393,619
                
                $
                146,403**LIABILITIES
                    AND STOCKHOLDERS’ EQUITY**Current
                    liabilities:Accounts
                    payable
                
                $
                46,823
                
                $
                5,000Total
                    current liabilities
                
                $
                46,823
                
                $
                5,000Commitments
                    and Contingencies (Note 6)Stockholders’
                    equity:Series
                    A’ redeemable preferred stock, $.0001 par value; 3,210,487 shares
                    authorized, issued and outstanding; liquidation preference of
                    $3,210,487
                
                
                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
                
                
                (35,686,178
                )
                
                (37,891,571
                )Total
                    stockholders’ equity
                
                
                2,346,796
                
                
                141,403Total
                    liabilities and stockholders’ equity
                
                $
                2,393,619
                
                $
                146,403
 
 See
          accompanying notes to financial statements.
 
  2
 **ENTROPIN,
          INC.**
 **(A
          DEVELOPMENT STAGE COMPANY)**
 **STATEMENTS
          OF OPERATIONS**
 **For
          the Three Months Ended September 30, 2004 and 2005**
 **(Unaudited)**
  **2004**
                
                **2005**Costs
                    and expenses:Research
                    and development
                
                $
                62,128
                
                $
                —General
                    and administrative
                
                
                449,919
                
                
                34,302Operating
                    loss
                
                
                (512,047
                )
                
                (34,302
                )Other
                    income (expense):Interest
                    income
                
                
                7,774
                
                
                —Interest
                    expense
                
                
                —
                
                
                —Impairment
                    of patent costs
                
                
                —
                
                
                (695,572
                )Other
                    Expense
                
                
                —
                
                
                —Total
                    other income (expense), net
                
                
                7,774
                
                
                (695,572
                )Net
                    loss
                
                
                (504,273
                )
                
                (729,874
                )Dividends
                    applicable to Series B preferred stockholders
                
                
                —
                
                
                —Net
                    loss applicable to common stockholders
                
                $
                (504,273
                )
                $
                (729,874
                )Basic
                    and diluted net loss per common share
                
                $
                (0.03
                )
                $
                (0.02
                )Weighted
                    average common shares outstanding
                
                
                30,595,000
                
                
                30,645,000
 
 See
          accompanying notes to financial statements.
 
 
 3
 **ENTROPIN,
          INC.**
 **(A
          DEVELOPMENT STAGE COMPANY)**
 **STATEMENTS
          OF OPERATIONS**
 **For
          the Nine Months Ended September 30, 2004 and 2005**
 **and
          for the Period from August 27, 1984 (Inception) Through September 30, 2005**
 **(Unaudited)**
  **2004**
                
                **2005**
                
                **Inception through
                    Sept. 30, 2005**Costs
                    and expenses:Research
                    and development
                
                $
                414,580
                
                $
                131,006
                
                $
                16,043,819General
                    and administrative
                
                
                2,161,973
                
                
                1,398,647
                
                
                21,223,387Operating
                    loss
                
                
                (2,576,553
                )
                
                (1,529,653
                )
                
                (37,267,206
                )Other
                    income (expense):Interest
                    income
                
                
                13,162
                
                
                20,762
                
                
                1,529,258Interest
                    expense
                
                
                —
                
                
                —
                
                
                (242,811
                )Impairment
                    of patent costs
                
                
                —
                
                
                (695,572
                )
                
                (695,572
                )Other
                    Expense
                
                
                —
                
                
                (931
                )
                
                (127,241
                )Total
                    other income (expense), net
                
                
                13,162
                
                
                (675,740
                )
                
                463,635Net
                    loss
                
                
                (2,563,391
                )
                
                (2,205,393
                )
                
                (36,803,571
                )Dividends
                    applicable to Series B preferred stockholders
                
                
                —
                
                
                —
                
                
                (1,103,184
                )Net
                    loss applicable to common stockholders
                
                $
                (2,563,391
                )
                $
                (2,205,393
                )
                $
                (37,906,755
                )Basic
                    and diluted net loss per common share
                
                $
                (0.10
                )
                $
                (0.07
                )
                $
                (4.64
                )Weighted
                    average common shares outstanding
                
                
                26,538,000
                
                
                30,645,000
                
                
                8,170,000
 
 See
          accompanying notes to financial statements.
  4
 **ENTROPIN,
          INC.**
 **(A
          DEVELOPMENT STAGE COMPANY)**
 **STATEMENT
          OF CHANGES IN STOCKHOLDERS’ EQUITY**
 **For
          the Nine Months Ended September 30, 2005**
 **(Unaudited)**
 **Series
                        A Redeemble**
                      **Preferred
                        Stock**
                    
                    
                    **Common
                        Stock****Shares**
                    
                    
                    **Amount**
                    
                    
                    **Shares**
                    
                    
                    **Amount**
                    
                    
                    **Additional
                        paid-in**
                      **capital**
                    
                    
                    **Deficit
                        accumulated during the development**
                      **stage**
                    
                    
                    **Total
                        stockholders’ equity**Balance,
                        January 1, 2005
                    
                    
                    3,210,487
                    
                    $
                    3,210,487
                    
                    
                    30,645,341
                    
                    $
                    3,065
                    
                    $
                    34,819,422
                    
                    $
                    (35,686,178
                    
                    $
                    2,346,796Net
                        loss for the period
                    
                    
                    —
                    
                    
                    —
                    
                    
                    —
                    
                    
                    —
                    
                    
                    —
                    
                    
                    (2,205,393
                    
                    
                    (2,205,393Balance,
                        September 30, 2005
                    
                    
                    3,210,487
                    
                    $
                    3,210,487
                    
                    
                    30,645,341
                    
                    $
                    3,065
                    
                    $
                    34,819,422
                    
                    $
                    (37,891,571
                    
                    $
                    141,403
 
 See
          accompanying notes to financial statements.
 
 5
  **ENTROPIN,
          INC.**
 **(A
          DEVELOPMENT STAGE COMPANY)**
 **STATEMENTS
          OF CASH FLOWS**
 **For
          the Nine Months Ended September 30, 2004 and 2005**
 **and
          for the Period from August 27, 1984 (Inception) Through September 30, 2005**
 **(Unaudited)**
  **2004**
                
                **2005**
                
                **Inception through
                    Sept. 30, 2005**Cash
                    flows from operating activities:Net
                    loss
                
                $
                (2,563,391
                )
                $
                (2,205,393
                )
                $
                (36,803,571
                )Adjustments
                    to reconcile net loss to net cash used in operating
                    activities:Depreciation
                    and amortization
                
                
                40,780
                
                
                30,624
                
                
                352,584Impairment
                    of patent costs
                
                
                —
                
                
                645,384
                
                
                645,384Series
                    B preferred stock redemption conversion incentive
                
                
                —
                
                
                —
                
                
                126,309Loss
                    on disposal of assets
                
                
                —
                
                
                —
                
                
                1,837Services
                    received in exchange for stock, stock options and warrants
                
                
                541,071
                
                
                —
                
                
                10,642,845Services
                    received in exchange for compensation agreements
                
                
                —
                
                
                —
                
                
                2,231,678Increase
                    (decrease) in accounts payable
                
                
                (106,539
                )
                
                (41,823
                )
                
                212,697Other
                
                
                —
                
                
                —
                
                
                58,610Net
                    cash used in operating activities
                
                
                (2,088,079
                )
                
                (1,571,208
                )
                
                (22,531,627
                )Cash
                    flows from investing activities:Maturities
                    (purchase) of short-term investments, net
                
                
                (1,665,094
                )
                
                1,273,000
                
                
                —Patent
                    costs
                
                
                (197,593
                )
                
                —
                
                
                (976,433
                )Purchase
                    of property and equipment
                
                
                —
                
                
                —
                
                
                (130,515
                )Net
                    cash provided by (used in) investing activities
                
                
                (1,862,687
                )
                
                1,273,000
                
                
                (1,056,760
                )Cash
                    flows from financing activities:Proceeds
                    from issuance of common stock and warrants
                
                
                3,489,893
                
                
                —
                
                
                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
                )
                
                —
                
                
                (40,000
                )Payment
                    for cancellation of common stock warrant
                
                
                —
                
                
                —
                
                
                (330,000
                )Proceeds
                    from convertible notes payable
                
                
                —
                
                
                —
                
                
                200,000Net
                    cash provided by financing activities
                
                
                3,454,893
                
                
                —
                
                
                23,734,790Net
                    (decrease) increase in cash and cash equivalents
                
                
                (495,873
                )
                
                (298,208
                )
                
                146,403Cash
                    and cash equivalents at beginning of period
                
                
                1,032,343
                
                
                444,611
                
                
                —Cash
                    and cash equivalents at end of period
                
                $
                536,470
                
                $
                146,403
                
                $
                146,403
 
 (Continued
          on following page)
 See
          accompanying notes to financial statements.
 
 6
 
 **ENTROPIN,
          INC.**
 **(A
          DEVELOPMENT STAGE COMPANY)**
 **STATEMENTS
          OF CASH FLOWS**
 **For
          the NineMonths Ended September 30, 2004 and 2005**
 **and
          for the Period from August 27, 1984 (Inception) Through September 30, 2005**
 **(Unaudited)**
 
 (Continued
          from preceding page)
 
 Supplemental
          disclosure of cash flow information:
  **2004**
                
                **2005**
                
                **Inception through
                    Sept. 30, 2005**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 September 30, 2005,
          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 September 30, 2005,
          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 September 30, 2005,
          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 September 30, 2005,
          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 financial statements.
 
 7
  **ENTROPIN,
          INC.**
 **(A
          DEVELOPMENT STAGE COMPANY)**
 **NOTES
          TO 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 six months ended September
          30,
          2005 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, 2004 as filed with the Securities and Exchange Commission on March
          31, 2005,
          and subsequently amended on April 29, 2005.
 
 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.
 
 As
          of
          September 30, 2005, the Company had total current assets of $146,403. 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
          September
          30, 2005 of $37,891,571. 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.
 
 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.
 
 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.
 
 8
  **ENTROPIN,
          INC.**
 **(A
          DEVELOPMENT STAGE COMPANY)**
 **NOTES
          TO FINANCIAL STATEMENTS**
 **(Unaudited)**
 
 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 $37,578 and $695,572
          for
          the nine months ended September 30, 2004 and 2005, respectively, and $997,968
          from inception through September 30, 2005. 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.
 
 Cash
          equivalents and short-term investments:
 
 The
          Company considers cash equivalents to include only highly liquid securities
          with
          an original maturity of three months or less. Investments with an original
          maturity of more than three months are considered short-term investments
          and
          have been classified by management as held-to-maturity. At December 31,
          2004,
          the Company’s short-term investments consisted entirely of certificates of
          deposit carried at amortized cost with average remaining maturity period
          of 71
          days. The Company had no short-term investments at September 30,
          2005.
 
 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.
 
 9
 
 **ENTROPIN,
          INC.**
 **(A
          DEVELOPMENT STAGE COMPANY)**
 **NOTES
          TO FINANCIAL STATEMENTS**
 **(Unaudited)**
 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.   Litigation
 
 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 July 2004. In both lawsuits, the central allegation is that Entropin,
          in its
          March 9, 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 9, 2000
          registration statement was neither false nor misleading and intends, if
          necessary, to vigorously defend itself against Plaintiffs’ allegations to the
          contrary. At this time, we cannot predict whether the possibility of an
          adverse
          uniform is likely or remote.
  
 10
 **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,
          2004, as
          amended.*
 
 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 September 30, 2005, our accumulated deficit
          was
          approximately $37.9 million.
 
 We
          have
          an immediate need to raise additional funds to continue our operations.
          As of
          September 30, 2005, we had total current assets of $146,403. 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 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 funds will be available to us to allow us to cover
          our
          expenses as they are incurred.
 
 11
 
 **Going
          Concern:**
 
 Our
          independent auditors have added an explanatory paragraph in connection
          with the
          December 31, 2004 financial statements, which states that our Company is
          in the
          development stage and has incurred an accumulated deficit at December 31,
          2004
          of $35,686,178. At September 30, 2005, the Company had an accumulated deficit
          of
          $37,891,571. 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.
 
 **Research
          and Development**
 
 Prior
          to
          the Company’s current focus on ENT-103, we completed four preclinical animal
          studies, Phase I, Phase II and Phase II/III human clinical trials for our
          first
          product, known as Esterom solution. In January 2002, we reported that our
          researchers at Harvard Medical School had identified the active ingredient
          in
          Esterom solution, which we named ENT-102. Results of our initial preclinical
          studies revealed that ENT-102 effectively blocks nerve impulse conduction
          and
          when injected into animals may have long-lasting properties to reduce and
          manage
          pain.
 
 Based
          on
          these findings and the results of our Phase II/III clinical study with
          Esterom
          solution, we decided to forego further development of Esterom solution
          and
          pursue development of ENT-102. In January 2003, we announced the discovery
          of a
          new chemical entity, ENT-103, a simplified derivative of ENT-102. ENT-103
          is a
          single chemical compound that exists as a single molecular species. In
          contrast,
          ENT-102 is a single chemical compound comprised of a mixture of four chemical
          species. Due to the demonstrated pain reduction equivalency of ENT-103
          and
          ENT-102 in preclinical studies, and the advantages of pursuing regulatory
          approval with a single molecule versus a mixture of four molecules, we
          decided
          to focus on the development of ENT-103 as a therapy for treatment of acute
          pain.
 
 Our
          current resources are not sufficient to complete the required preclinical
          testing nor to begin or complete a Phase I clinical trial for ENT-103.
          Assuming
          that we can raise funds to support our operations and our clinical trials
          are
          successful and we do not experience unexpected delays, we estimate that
          it will
          take at least an additional four to five years to complete the preclinical
          and
          clinical development and testing of ENT-103 so that it can be commercialized.
          Any significant delays in our preclinical development, clinical trials
          or
          regulatory approval will affect our ability to generate revenue and may
          harm our
          ability to continue to raise the capital needed to complete the
          commercialization of ENT-103. We estimate that an additional $45 million
          will be
          required to complete development and FDA approval of ENT-103. These expenditures
          primarily represent research, clinical trials and general and administrative
          costs.
 
 **Plan
          of Operation**
 
 We
          have
          an immediate need to raise additional funds to continue our operations.
          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 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 additional funds will be available to us to allow us
          to
          cover our expenses as they are incurred.
 
 12
 **Results
          of Operations**
 
 **Three
          months ended September 30, 2005, compared to three months ended September
          30,
          2004.**
  The
          net
          loss for the three months ended September 30, 2005 was approximately $0.73
          million, or $0.02 per share on approximately 30.6 million weighted average
          shares outstanding. In comparison, the net loss for the three months ended
          September 30, 2004 was approximately $.5 million, or $0.03 per share on
          approximately 30.6 million weighted average shares outstanding.
 
 Total
          research and development expenses were $0 for the three months ended September
          30, 2005, as compared to approximately $62,000 for the same period in 2004,
          a
          decrease of $62,000 or 100%.
 
 Total
          general and administrative expenses were approximately $34,000 for the
          three
          months ended September 30, 2005, as compared to approximately $450,000
          for the
          same period in 2004, a decrease of $416,000 or 92%.
 
 Interest
          income during the three months ended September 30, 2005 was $0 as compared
          to
          approximately $7,800 during the same period in 2004, a decrease of $7,800
          or
          100%. This decrease in interest income reflects zero short-term investments
          during the three months ended September 30, 2005.
 
 **Nine
          months ended September 30, 2005, compared to nine months ended September
          30,
          2004.**
 
 The
          net
          loss for the first nine months of 2005 was approximately $2.2 million,
          or $0.07
          per share on approximately 30.6 million weighted average shares outstanding.
          In
          comparison, the net loss for the first nine months of 2004 was approximately
          $2.56 million, or $0.10 per share on approximately 26.5 million weighted
          average
          shares outstanding.
 
 Total
          research and development expenses were approximately $131,000 during the
          first
          nine months of 2005, as compared to approximately $415,000 for the first
          nine
          months of 2004, a decrease of $284,000 or 68%. The decrease in research
          and
          development expenses during the first nine months of 2005 compared with
          the same
          period during 2004 reflects the fact that preclinical research was restricted
          during the first nine months of 2005 due to cash constraints and the
          discontinued operations during the second quarter.
 
 Total
          general and administrative expenses were approximately $1.4 million for
          the
          first nine months of 2005, as compared to approximately $2.2 million for
          the
          first nine months of 2004, a decrease of $.8 million or 36%. Approximately
          $527,000 of the general and administrative expense incurred during the
          first
          nine months of 2004 reflected charges to non-cash compensation for the
          fair
          value of stock options and warrants issued for services. No such non-cash
          charges were incurred during the first nine months of 2005.
 
 Interest
          income during the first nine months of 2005 was approximately $20,800 as
          compared to approximately $13,200 during the first nine months of 2004,
          an
          increase of $7,600 or 58%. This increase in interest income reflects higher
          average balances for cash, cash equivalents and short-term investments
          during
          the first nine months of 2005.
  **Liquidity
          and Capital Resources**
 
 As
          of
          September 30, 2005, we had total current assets of $146,403. 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.
 
 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 September 30, 2005 of approximately $37.9 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 September
          30, 2005, we have received net cash proceeds from financing activities
          aggregating approximately $23.7 million. As of September 30, 2005, our
          working
          capital was approximately $141,000.
 
 13
  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 $1.6 million during the
          first
          nine months of 2005, compared with approximately $2.1 million during the
          first
          nine months of 2004. The cash used in operations was primarily related
          to
          conducting preclinical research studies and maintaining our administrative
          infrastructure.
 
 **Critical
          Accounting Policies**
 
 We
          routinely grant stock options to compensate officers, directors and employees
          for their services. This practice allows us to conserve our cash resources
          for
          our drug development program. We have 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
          is 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 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.
 
 **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.*
 
 **Going
          Concern:**
 
 Our
          independent auditors have added an explanatory paragraph in connection
          with the
          December 31, 2004 financial statements, which states that our Company is
          in the
          development stage and has incurred an accumulated deficit at December 31,
          2004
          of $35,686,178. At September 30, 2005, the Company had an accumulated deficit
          of
          $37,891,571. 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.
 
 **We
          need to raise additional funds immediately to support our operations. If
          we are
          unable to raise these funds, we may not be able to resume our operations.
          (We
          ceased operations last quarter.)**
 
 We
          have
          an immediate need to raise additional funds to continue our operations.
          As of
          September 30, 2005, we had total current assets of $146,403. 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. 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 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 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.
 
 14
   **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 September 30, 2005, we have incurred cumulative net losses
          applicable to common stockholders of $37.9 million. We ceased operations
          last
          quarter.
 
 **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 July 2004. In both lawsuits, the central allegation is that Entropin,
          in its
          March 9, 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 9, 2005
          registration statement was neither false nor misleading and intends, if
          necessary, to vigorously defend itself against Plaintiffs’ allegations to the
          contrary. At this time, we cannot predict whether the possibility of an
          adverse
          uniform is likely or remote.
  **We
          have appointed two new Board members and our other Board directors and
          executive
          employees have resigned**
 
 On
          May
          13, 2005, the Board of Directors of the Company appointed Mr. Jeffrey Ploen
          and
          Mr. David Norris to the Board.
 
 Following
          these appointments, Drs. Higgins D. Bailey, Randall L. Carpenter and Thomas
          G.
          Tachovsky and Messrs. David M. Chapman, Joseph R. Ianelli, Paul V. Maier
          and
          Bruce R. Manning resigned from the Board, with each resignation to be effective
          immediately following the Board Meeting held on May 13, 2005.
 
 We
          lost
          the services of our only two full-time executive employees, Thomas Tachovsky
          and
          Patricia Kriss, our Chief Executive Officer and Chief Financial Officer,
          respectively. Dr. Carpenter served on the Company’s Sceintific Committee. Dr.
          Tachovsky served on the Company’s Executive and Scientific Committees.
 
 15
  **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.
 
 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
          September 30, 2005, there were 30,645,341 shares of common stock issued
          and
          outstanding and 3,210,487 shares of Series A’ preferred stock.
 
 **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 second fiscal quarter ended September 30, 2005, 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.
 
 16
 
 **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 July 2004. In both lawsuits, the central allegation is that Entropin,
          in its
          March 9, 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 9, 2005
          registration statement was neither false nor misleading and intends, if
          necessary, to vigorously defend itself against Plaintiffs’ allegations to the
          contrary. At this time, we cannot predict whether the possibility of an
          adverse
          uniform is likely or remote.
  
 **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**
 
 There
          have been no matters submitted to a vote of security holders during the
          quarterly period ended September 30, 2005 through the solicitation of proxies
          or
          otherwise.
 
 **Item
          5.**   **Other
          Information**
 
 None.
 
 17
  **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)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.
  (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.
 
 18
  **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:
                    November 15, 2005
                By:/s/ David
                    NorrisDavid
                    NorrisChief
                    Executive OfficerDate:
                    November 15, 2005
                By:/s/ David
                    NorrisDavid
                    NorrisChief
                    Financial Officer
 
 19