United States Securities and Exchange Commission
                             Washington, D.C. 20549


                                   Form 10-QSB
(Mark One)

[X]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
     ACT OF 1934 For the quarterly period ended June 30, 1999.

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

     For the transition period from ____________ to ___________

                        Commission file number : 33-23489

                           BIOGAN INTERNATIONAL, INC.
             (Formerly known as Biogan Medical International, Inc.)
                 (Exact name of business issuer in its charter)

         DELAWARE                                          58-1832055
State or other jurisdiction of                          (I.R.S. Employer
incorporation or organization)                          Identification No.)

   7213 Potomac Drive,  Boise,  Idaho                        83704
(Address of principal executive offices)                   (Zip Code)

Issuer's telephone number: (208)-376-8500              Fax:  (208) 376-4663


                                (Former Address)

     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) Yes [_],
No [X], and (2) has been subject to such filing requirements for the past 90
days. Yes [X] No.[_]

The  number of  shares  of common  stock  outstanding  as of June 30,  1998,  is
85,122,884.


         Transitional Small Business Disclosure Format. Yes [_], No [X].


                                                                               1
<PAGE>


                         PART I - FINANCIAL INFORMATION

Item 1.   Financial Statements.

     The following financial statements are filed as part of this report:

     The Financial Statements of the Company for the three months ended June 30,
1999, prepared by Wadsworth & Smith, Chartered, certified public accountants,
without audit.

Item 2.   Management's Discussion and Plan of Operation:

Results of Operations:

     Operations for the 2nd quarter ended June 30, 1999, resulted in an
operating loss of $21,743 or about $0.0003 per share. During the 2nd quarter
Management continued to focus its efforts on locating and developing financing
and/or joint ventures for the continued development and marketing of the
IntorCorp Motor (previously referred to as Smart-Power Motor) for its subsidiary
IntorCorp, Inc., and on developing its business plan for continued independent
business activity.

Funding and Capital Resources:

     The Company's cash balances and liquidity were exhausted in 1998 and
Management reduced its leased office space and placed employees on a part-time
basis to reduce operating expenses, and arranged short term loans to continue
operations of the Company through the first two quarters 1999. Management
presently anticipates that additional working capital for continuing the
business of the Company will be located by a combination of one or more private
placements of common and/or preferred stock, joint venture development, debt
financing, or other means, all of which are being explored and implemented by
Management.

Plan of Operation:

     The Plan of Operation for Biogan is to (i) continue attempts to locate
financing and/or joint venture entities for developing and marketing of the
IntorCorp Motor through its subsidiary IntorCorp, Inc., (ii) develop a
consulting and management service for other companies, and (iii) locate and
acquire and/or joint venture with other businesses.


                                                                               2
<PAGE>


                           PART II - OTHER INFORMATION

Item 1.   Legal Proceedings. None

Item 2.   Changes in Securities.

     (a) None

     (b) None

     (c) None


Item 3.   Defaults Upon Senior Securities. None

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

Item 5.   Other Matters.


     Biogan and Collective Technologies, L.L.C., an Idaho electrical engineering
firm, entered into a Preincorporation Agreement effective February 25, 1998, in
which Biogan and Collective Technologies each agreed

     (i)  to transfer to IntorCorp, Inc., an Idaho corporation formed March 11,
          1998, their respective rights to all of the intellectual technology of
          the "IntorCorp Motor" each in exchange for a 50% ownership interest.

     (ii) that a consulting agreement will be entered into with Collective
          Technologies, Inc. providing for compensation compatible with industry
          standards in the locality, for the continued development and testing
          of the "IntoCorp Motor".

     Reference is made to the 1997 year end 10KSB for a copy of the
Preincorporation Agreement, resumes of the members of the Board of Directors of
IntorCorp, Inc., and resumes of key engineers of Collective Technologies, L.L.C.


Item 6.   Exhibits.

          (a)  No exhibits

          (b)  No Form 8K filings


                                                                               3
<PAGE>


                                   SIGNATURES

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



                                   BIOGAN INTERNATIONAL, INC.
                                            (Registrant)


         Date: August 10, 1999.         By__________/s/________________________
                                        Ronald J. Tolman, Acting Vice-President


         Date: August 10, 1999          By__________/s/________________________
                                        Rulon L. Tolman, Vice-President


                                                                               4
<PAGE>


                           BIOGAN INTERNATIONAL, INC.
                         (A DEVELOPMENT - STAGE COMPANY)

                              FINANCIAL STATEMENTS
                                  JUNE 30, 1999




                                     [LOGO]


<PAGE>


                           BIOGAN INTERNATIONAL, INC.
                          (A DEVELOPMENT-STAGE COMPANY)
                                  JUNE 30, 1999


         CONTENTS

         Accountants' Compilation Report                        1

         Balance Sheet                                          2

         Statement of Operations                                3

         Statement of Stockholders' Equity(Deficiency)          4

         Statement of Cash Flows                                5

         Notes to Financial Statements                        6-12


<PAGE>


[LOGO]                                                              [LETTERHEAD]
--------------------------------------------------------------------------------



To the Board of Directors
Biogan International, Inc.
Boise, ID




Board of Directors:

We have compiled the accompanying balance sheet of Biogan International, Inc. (a
development-stage company) as of June 30, 1999, and the related statements of
operations, stockholders' equity, and cash flows for the three month period
ended June 30, 1999 and the period from February 5, 1988 (inception) through
June 30, 1999, in accordance with Statements on Standards for Accounting and
Review Services issued by the American Institute of Certified Public
Accountants.

A compilation is limited to presenting in the form of financial statements
information that is the representation of management (the owners). We have not
audited or reviewed the accompanying financial statements and, accordingly, do
not express an opinion or any other form of assurance on them.

We are not independent with respect to Biogan International, Inc.




/s/ Wadsworth & Smith, P.C.

Wadsworth & Smith, P.C.
August 10, 1999


                                       1
<PAGE>


                           BIOGAN INTERNATIONAL, INC.
                          (A DEVELOPMENT-STAGE COMPANY)
                                  BALANCE SHEET
                               As of JUNE 30, 1999




ASSETS
CASH                                                           $        56
PAYROLL ADVANCE                                                        400
                                                               -----------
TOTAL CURRENT ASSETS                                           $       456

FURNITURE/EQUIPMENT                                                 34,716
ACCUMULATED DEPRECIATION                                           (16,556)
                                                               -----------

TOTAL FIXED ASSETS                                             $    18,160

INVESTMENT IN SUBSIDIARIES                                            --


TOTAL ASSETS                                                   $    18,616
                                                               ===========


LIABILITIES & STOCKHOLDERS' EQUITY (DEFICIENCY)
ACCOUNTS PAYABLE                                               $    63,544
NOTES PAYABLE - STOCKHOLDERS                                        80,000
NOTES PAYABLE - OTHER                                               45,000
ACCRUED SALARIES - OFFICERS                                        171,200
ACCRUED EXPENSES (ACCRUED INTEREST DUE STOCKHOLDERS $21,019)        24,187
                                                               -----------

TOTAL CURRENT LIABILITIES                                      $   383,931

STOCKHOLDERS' EQUITY (DEFICIENCY)
  PREFERRED STOCK $.001 PAR VALUE,
    10,000,000 SHARES AUTHORIZED NO SHARES ISSUED
  COMMON STOCK $.001 PAR VALUE 300,000,000
    SHARES AUTHORIZED, 85,122,884 ISSUED                            85,123
ADDITIONAL PAID IN CAPITAL                                       4,367,807
DEFICIT ACCUMULATED DURING THE DEVELOPMENT STAGE                (4,818,245)
                                                               -----------

TOTAL STOCKHOLDERS' EQUITY (DEFICIENCY)                        $  (365,315)
                                                               -----------

TOTAL LIABILITIES & STOCKHOLDERS' EQUITY (DEFICIENCY)          $    18,616
                                                               ===========


                 SEE ACCOMPANYING NOTES AND ACCOUNTANTS' REPORT

                                        2

                             WADSWORTH & SMITH, P.C.
                          CERTIFIED PUBLIC ACCOUNTANTS
<PAGE>


                           BIOGAN INTERNATIONAL, INC.
                          (A DEVELOPMENT-STAGE COMPANY)
                             STATEMENT OF OPERATIONS


<TABLE>
<CAPTION>

                                                                           FROM INCEPTION
                                           FOR THE 3 MONTH PERIOD         FEBRUARY 5, 1988
                                                   ENDED                      THROUGH
                                               JUNE 30, 1999                JUNE 30, 1999
<S>                                             <C>                          <C>
SALES
REVENUE - FEES                                  $      --                    $     7,150
RENTAL INCOME                                           360                        1,650
                                                -----------                  -----------

TOTAL SALES                                             360                        8,800

EXPENSES
WAGES                                           $      --                   $   503,889
STOCK SUBSCRIPTION LOSS                                --                        101,006
DEPRECIATION EXPENSE                                  1,473                       16,706
INTEREST EXPENSE                                      2,942                       44,295
INCENTIVE BONUS                                        --                        149,364
LEGAL & ACCOUNTING FEES                              12,397                      288,601
RENT                                                    611                       37,287
START UP COSTS                                         --                        127,441
RESEARCH AND DEVELOPMENT                               --                        343,703
SUBSIDIARIES LOSSES                                    --                        158,380
OTHER OPERATING EXPENSES                              4,611                      380,204
                                                -----------                  -----------

TOTAL EXPENSES                                  $    22,034                  $ 2,150,876
                                                -----------                  -----------

NET OPERATING INCOME (LOSS)                         (21,674)                  (2,142,076)

STOCK RESTITUTION EXPENSE (NOTE 1D)                    --                     (2,676,409)
INTEREST INCOME                                          15                        5,463
OTHER INCOME                                           --                            238
MISCELLANEOUS EXPENSE                                   (84)                      (5,281)
                                                -----------                  -----------

TOTAL OTHER                                     $       (69)                 $(2,675,989)
                                                -----------                  -----------

NET INCOME (LOSS)                               $   (21,743)                 $(4,818,065)
                                                ===========                  ===========


PRIMARY INCOME (LOSS) PER SHARE                 ($   0.0003)                 ($   0.1186)
                                                ===========                  ===========
</TABLE>


                 SEE ACCOMPANYING NOTES AND ACCOUNTANTS' REPORT

                                        3

                             WADSWORTH & SMITH, P.C.
                          CERTIFIED PUBLIC ACCOUNTANTS
<PAGE>


                           BIOGAN INTERNATIONAL, INC.
                          (A DEVELOPMENT-STAGE COMPANY)
                 STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIENCY)
                FOR THE PERIOD FROM INCEPTION (FEBRUARY 5, 1988)
                              THROUGH JUNE 30, 1999

<TABLE>
<CAPTION>

                                                                                                         DEFICIENCY
                                                                                                         ACCUMULATED
                      COMMON STOCK                                           AMOUNT        ADDITIONAL    DURING THE    STOCKHOLDERS'
--------------------------------------------------------------------          PER           PAID-IN      DEVELOPMENT      EQUITY
ISSUED:                                    SHARES             AMOUNT         SHARE          CAPITAL        STAGE        (DEFICIENCY)
--------------------------------------------------------------------         ------         -------      -----------   -------------
<S>                                      <C>             <C>                 <C>          <C>                <C>        <C>
July 27, 1988                             2,250,000           2,250          0.0111          22,750          --            25,000
January 25, 1989                         17,750,000          17,750          0.0060          88,750          --           106,500
January 29, 1989                          3,637,347           3,637          0.0309         108,602          --           112,239

To management:
  September 14, 1995                     41,955,173          41,955          0.0010            --            --            41,955
  September 14, 1995                        906,667             907          0.0030           1,813          --             2,720
  September 14, 1995                        452,600             453          0.0100           4,073          --             4,526
  October 4, 1995                            61,980              62          0.1000           6,136          --             6,198
  December 8, 1995                           23,580              24          0.2500           5,871          --             5,895

For professional services:
  September 14, 1995                        120,000             120          0.0100           1,080          --             1,200
  October 4, 1995                           100,000             100          0.0100             900          --             1,000
  December 8, 1995                          100,000             100          0.0100             900          --             1,000
  February 23, 1996                         115,222             115          0.2149          24,643          --            24,759
  July 29, 1996                             493,034             493          0.2149         105,448          --           105,941
  December 2, 1996                          417,893             418          0.3691         153,835          --           154,253
  January 31, 1997                          250,774             251          0.2460          61,436          --            61,687
  February 28, 1997                          56,621              57          0.2600          14,665          --            14,721
  March 15, 1997                             76,173              76          0.2600          19,729          --            19,805
  March 29, 1997                             15,400              15          0.2600           3,989          --             4,004
  June 2, 1997                              225,597             226          0.1492          33,441          --            33,667
  August 12, 1997                           224,269             224          0.1465          32,626          --            32,851
  October 31, 1997                          304,546             305          0.1892          57,322          --            57,626
  December 31, 1997                        (352,634)           (353)         0.2070         (72,650)         --           (73,003)
  February 28, 1998                         120,000             120          0.1872          22,340          --            22,460
 June 30, 1998                              342,820             343          0.0191           6,213          --             6,556
 December 31, 1998                           25,545              26          0.0010               0          --                26

For loan payments:
  September 14, 1995                         61,000              61          0.1000           6,039          --             6,100
  November 1, 1995                           50,000              50          0.1000           4,950          --             5,000
  December 8, 1995                           10,000              10          0.1000             990          --             1,000
  August 12, 1997                            41,600              42          0.2000           8,278          --             8,320
  August 31, 1997                            66,666              67          0.1500           9,933          --            10,000
  October 1, 1997                            57,692              58          0.2600          14,942          --            15,000
  December 30, 1997                         240,000             240          0.2504          59,856          --            60,096
  December 31, 1998                         240,564             241          0.2696          64,625          --            64,865

For restitution:
  September 14, 1995                      2,668,967           2,669          0.2500         664,573          --           667,242
  October 4, 1995                         2,180,600           2,181          0.2500         542,969          --           545,150
  November 1, 1995                          372,270             372          0.2500          92,695          --            93,068
  December 8, 1995                        7,353,248           7,353          0.2500       1,830,959          --         1,838,312
  February 23, 1996                         744,444             744          0.2500         185,367          --           186,111
  May 3, 1996                               125,929             126          0.2500          31,356          --            31,482
  June 21, 1996                             350,863             351          0.2500          87,365          --            87,716
  July 29, 1996                             310,567             311          0.2500          77,331          --            77,642
  September 11, 1996                          2,667               3          0.2500             664          --               667
  December 2, 1996                           73,480              73          0.2500          18,297          --            18,370
  January 31, 1997                            4,000               4          0.2500             996          --             1,000
  February 28, 1997                          38,000              38          0.2500           9,462          --             9,500
  June 2, 1997                               18,000              18          0.2500           4,482          --             4,500
  August 12, 1997                            11,200              11          0.2500           2,789          --             2,800
  October 31, 1997                            4,400               4          0.2500           1,096          --             1,100
  November 20, 1998                      (3,553,000)         (3,553)         0.2500        (884,697)         --          (888,250)

For dispute settlement:
  October 4, 1995                            25,000              25          0.1000           2,475          --             2,500
  November 1, 1995                           31,030              31          0.1000           3,072          --             3,103
  December 8, 1995                           50,000              50          0.1000           4,950          --             5,000

For private offering:
  September 14, 1995                         75,000              75          0.1000           7,425          --             7,500
  November 1, 1995                            5,000               5          0.2500           1,245          --             1,250
  December 8, 1995                          256,000             256          0.2500          63,744          --            64,000
  February 23, 1996                         672,923             673          0.2208         147,875          --           148,548
  May 3, 1996                               353,667             354          0.2208          77,718          --            78,072
  June 21, 1996                             606,900             607          0.2208         133,366          --           133,973
  July 29, 1996                             252,000             252          0.2201          55,206          --            55,458
  December 31, 1996                          54,350              54          0.4600          24,946          --            25,000
  March 29, 1997                            154,000             154          0.2500          38,346          --            38,500
  December 4, 1997                          640,000             640          0.2500         159,360          --           160,000
  December 31, 1997                         708,750             709          0.1422         100,041          --           100,750
  February 18, 1998                          30,000              30          0.1300           3,870          --             3,900
  June 8, 1998                               62,500              63          0.0800           4,938          --             5,000

NET LOSS                                       --              --                              --      (4,818,065)     (4,818,065)
                                        -----------     -----------                     -----------   -----------     -----------

                                         85,122,884          85,123                       4,367,807    (4,818,065)       (365,135)
                                        ===========     ===========                     ===========   ===========     ===========
</TABLE>


                 SEE ACCOMPANYING NOTES AND ACCOUNTANTS' REPORT.

                                        4

                             WADSWORTH & SMITH, P.C.
                          CERTIFIED PUBLIC ACCOUNTANTS


<PAGE>


                           BIOGAN INTERNATIONAL, INC.
                          (A DEVELOPMENT-STAGE COMPANY)
                             STATEMENT OF CASH FLOWS

<TABLE>
<CAPTION>
                                                                                                FROM INCEPTION
                                                                       FOR THE 3 MONTH         FEBRUARY 5, 1988
                                                                         PERIOD ENDED               THROUGH
                                                                         JUNE 30, 1999           JUNE 30, 1999

<S>                                                                     <C>                        <C>
CASH FLOWS FROM OPERATIONS
NET INCOME (LOSS)                                                       $   (21,743)               $(4,818,065)

ADJUSTMENTS TO RECONCILE NET LOSS TO
NET CASH USED BY OPERATING ACTIVITIES:
ADD BACK STOCK ISSUED FOR:
MANAGEMENT                                                                     --                       61,294
CONTRACT LABOR, INCENTIVE BONUSES, PROFESSIONAL
    SERVICES, AND RESEARCH AND DEVELOPMENT                                     --                      468,552
RESTITUTION                                                                    --                    2,676,409
INTEREST EXPENSE                                                               --                       28,920
DISPUTE SETTLEMENTS                                                            --                       10,603

OTHER ADJUSTMENTS:
SUBSIDIARIES LOSSES                                                            --                      158,380
STOCK SUBSCRIPTION LOSS                                                        --                      101,006
FIRST DEVELOPMENT STAGE LOSS                                                   --                      142,733
DEPRECIATION AND AMORTIZATION                                                 1,473                     16,706
                                                                        -----------                -----------
TOTAL ADJUSTMENTS                                                             1,473                  3,664,603

ADVANCES                                                                       --                         (400)
ACCOUNTS RECEIVABLE                                                            --                         (180)
ACCOUNTS PAYABLE                                                              8,955                     63,544
ACCRUED LIABILITIES                                                           1,552                    195,387
                                                                        -----------                -----------

NET CASH PROVIDED (USED)
BY OPERATING ACTIVITIES                                                 $   (9,763)               $  (895,111)
                                                                        -----------                -----------

CASH FLOWS FROM INVESTING ACTIVITIES
PURCHASE FURNITURE/EQUIPMENT                                                   --                      (35,113)
DISPOSAL FURNITURE/EQUIPMENT                                                   --                          475
INVESTMENT IN BIOMAGNETRONICS                                                  --                     (103,937)
INVESTMENT IN BIOLINK                                                          --                      (54,443)
                                                                        -----------                -----------

NET CASH PROVIDED (USED)
BY INVESTING ACTIVITIES                                                 $      --                  $  (193,018)
                                                                        -----------                -----------

CASH FLOWS FROM FINANCING ACTIVITIES
NOTE PAYABLE-STOCKHOLDER                                                       --                       80,000
NOTES PAYABLE - OTHER RECEIVED                                               10,000                    230,141
PAYMENT OF NOTES PAYABLE - OTHER                                               --                      (43,680)
ISSUANCE OF COMMON STOCK                                                       --                      821,952
OTHER                                                                          --                         (228)
                                                                        -----------                -----------

NET CASH PROVIDED (USED)
BY FINANCING ACTIVITIES                                                 $    10,000                $ 1,088,185
                                                                        -----------                -----------


NET INCREASE(DECREASE) IN CASH                                          $       237               $        56


BEGINNING CASH BALANCE                                                  $      (181)               $      --
                                                                        -----------                -----------

CASH ENDING BALANCE                                                     $        56                $        56
                                                                        ===========                ===========


SUPPLEMENTAL INFORMATION

CASH PAYMENTS FOR INTEREST EXPENSE                                      $      --                  $     2,711
CASH PAYMENTS FOR INCOME TAXES                                                 --                         --

NONMONETARY TRANSACTIONS
STOCK ISSUED FOR:
DEBT REDUCTION                                                                 --                      141,461
MANAGEMENT                                                                     --                       61,294
CONTRACT LABOR, INCENTIVE BONUSES, PROFESSIONAL
    SERVICES, AND RESEARCH AND DEVELOPMENT                                     --                      468,552
RESTITUTION                                                                    --                    2,676,409
INTEREST EXPENSE                                                               --                       28,920
DISPUTE SETTLEMENTS                                                            --                       10,603
</TABLE>


                 SEE ACCOMPANYING NOTES AND ACCOUNTANTS' REPORT

                                        5

                             WADSWORTH & SMITH, P.C.
                          CERTIFIED PUBLIC ACCOUNTANTS
<PAGE>


                           BIOGAN INTERNATIONAL, INC.
                          (A DEVELOPMENT-STAGE COMPANY)
                          NOTES TO FINANCIAL STATEMENTS
                                  JUNE 30, 1999


1.   BUSINESS AND ABILITY TO CONTINUE IN EXISTENCE

     Biogan International, Inc. (Biogan), is a development-stage company. See
     Note 5 "Stockholders' Equity" for a history of Biogan's securities issuance
     and accumulated deficit. Management presently intends to focus aggressively
     on the continued further development and prototype testing of the
     Motor/Controller system as well as entering into strategic alliances for
     both manufacturing and marketing of the motor. Additional capital will be
     required to fund the growth and expansion and provide working capital for
     continued operations.

     Biogan and Collective Technologies, LLC (Collective) negotiated a joint
     venture Preincorporation Agreement effective February 25, 1998, in which
     Biogan and Collective Technologies each agreed:



          (i)  to transfer to "IntorCorp, Inc." (a new Idaho corporation ) their
               respective rights to all of the intellectual technology of the
               "IntorCorp Motor", each in exchange for 50% ownership interest,
               and

          (ii) that a consulting agreement will be entered into with Collective
               for the continued development and testing of the "IntorCorp
               Motor" compatible with industry standards in the locality.

     The Business Plan incorporated in the Preincorporation Agreement
     acknowledges that:



          (i)  the 5HP DC Feasibility Prototype has been developed and tested,
               and

          (ii) management is currently considering the options of developing (a)
               a large power (40HP) motor or (b) a duel development of a 5/10HP
               motor.


     Under either of the options the cost to develop support functions, conduct
     the laboratory prototype phase development and testing, complete production
     prototype phase development, and field test the motors will take
     approximately two years and will cost approximately $6,000,000. Management
     is currently of the opinion that the risks are lower and the market
     potential higher with 5/10 HP motors, however, the final decision will be
     made at such time as financing is located and committed. Research and
     development on the motor have ceased and will continue when funds are
     available. The company is continuing to search for funding for the
     development of the motor.


                             See Accountants' Report

                                       -6-


                             WADSWORTH & SMITH, P.C.
                          CERTIFIED PUBLIC ACCOUNTANTS
<PAGE>


                           BIOGAN INTERNATIONAL, INC.
                         (A DEVELOPMENT- STAGE COMPANY)
                    NOTES TO FINANCIAL STATEMENTS - Continued
                                  JUNE 30, 1999


     Management presently does not have any plans for the purchase or
     acquisition of any significant plant or other equipment. It is anticipated
     that additional employees will be required by the Registrant as the
     acquired operations meet their expected growth. Since it is uncertain
     whether Biogan will be successful in these ventures and whether it can
     obtain sufficient capital to finance these ventures, it is uncertain
     whether the Company will be capable of continuing in existence.
     Management's plans to continue in existence are discussed in Note 6B.


2.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

A.   PRESENTATION

     The accompanying financial statements have been prepared in accordance with
     the Statement of Financial Accounting Standards No. 7 "Accounting and
     Reporting by Development-stage Enterprises". A development stage enterprise
     is one in which planned principal operations have not commenced or if its
     operations have commenced there has been no significant revenue there from.
     Development-stage companies report cumulative costs from the enterprise's
     inception. Biogan has had two stages of development (Note 5G).

B.   INVESTMENT IN SUBSIDIARIES

     Biogan owns 50% of the voting stock of BioMagnetronics, Inc. and Biolink ,
     Inc. Biomagnetronics, Inc. and Biolink, Inc. were both development-stage
     enterprises and neither company had any operating activities during the
     current period of operations. The investments were accounted for by the
     equity method whereby the purchase of stock shares was recorded at cost and
     increased and decreased by 50% of any profits or losses respectively.
     Biogan invested $103,937 in Biomagnetronics, Inc. and $54,443 in Biolink,
     Inc. The carrying amount of the investments have been reduced to $0 for
     each company since both companies have had no operating activities and
     there are no plans for future operations. As of June 30, 1999, neither
     company has assets of any value.

     The Board of Directors of IntorCorp, Inc., a new corporation, met on April
     30, 1998, and at that time approved the issuance of stock to Biogan and
     Collective in exchange for the transfer of their respective rights of their
     Intellectual Technology. Biogan owns 50% of the voting stock of the new
     corporation. The other investor in the new corporation is Collective, an
     engineering group. The two groups formed this new corporation in order to
     continue further development of the motor. The new corporation is a
     development stage company. There have been no financial transactions in the
     new corporation.

C.   STOCK VALUATION

     Stock issued for non cash consideration has been valued at market value or
     above from $.001 to $.25 per share (see Statement of Stockholders' Equity
     "To Management" Note 5D). Stock issued for restitution (Note 5F) is valued
     at $.25 per share.

                             See Accountants' Report
                                       -7-

                             WADSWORTH & SMITH, P.C.
                          CERTIFIED PUBLIC ACCOUNTANTS
<PAGE>


                           BIOGAN INTERNATIONAL, INC.
                          (A DEVELOPMENT-STAGE COMPANY)
                    NOTES TO FINANCIAL STATEMENTS - Continued
                                  JUNE 30, 1999

D.   NET INCOME (LOSS) PER SHARE

     The net income (loss) per share has been calculated using the weighted
     average number of shares of common stock outstanding during the development
     stage period. The weighted average number of shares of common stock
     outstanding for the period ended June 30, 1999, and the period from
     February 5, 1988 (inception), through June 30, 1999, was 85,122,884; and
     40,638,048 respectively. Stock options have not been considered in the
     calculation of loss per share because they are antidilutive. Of the
     85,122,884 shares outstanding 59,089,340 are restricted and 26,033,544
     shares are unrestricted.

E.   INCOME TAXES

     At June 30, 1999, Biogan had net operating losses (NOL) carryforwards as
     follows:


             YEAR                     NOL            YEAR EXPIRES
             1995                2,819,521               2010
             1996                1,122,539               2011
             1997                  736,051               2012
                                ----------
                                $4,678,111

     No deferred asset will be recognized on the tax benefit resulting from the
     NOL until the Company becomes profitable. While management believes the
     loss recorded due to the stock restitution loss ($2,676,409) is a tax
     deductible expense, it could be subject to an IRS disallowance.

F.   FURNITURE AND EQUIPMENT

     Furniture and equipment are carried at cost. Depreciation of furniture and
     equipment is provided using the straight-line method of depreciation and
     the accelerated cost recovery method for federal income tax purposes.
     Depreciation is calculated over useful life ranging from 5 to 10 years.

3.   NOTES PAYABLE AT JUNE 30, 1999, CONSISTED OF THE FOLLOWING:

     Notes Payable - Other:

     Notes payable to an individual with interest at 10% per
     annum from July 1, 1998. Note is unsecured and is payable on
     demand.                                                              5,000

     Notes payable to an individual with interest at 10% per annum
     from August 18, 1998. Note is unsecured and is payable on demand.   15,000

     Notes payable to an individual with interest at 12% per annum
     from September 29, 1998. Note is unsecured and is payable on
     demand.                                                             15,000


                             See Accountants' Report
                                       -8-

                             WADSWORTH & SMITH, P.C.
                          CERTIFIED PUBLIC ACCOUNTANTS
<PAGE>


                           BIOGAN INTERNATIONAL, INC.
                          (A DEVELOPMENT-STAGE COMPANY)
                    NOTES TO FINANCIAL STATEMENTS - Continued
                                  JUNE 30, 1999

Notes payable to an individual with interest at 10% per annum
from April 29, 1999. Note is unsecured and is due April 28, 2000.        10,000
                                                                        -------

Total Notes Payable -  Other                                            $45,000
                                                                        =======

Notes Payable - Stockholder:

Notes payable to Ronald J. Tolman with interest at 10% per annum
from November 13, 1996, note is unsecured and is payable on demand.
Payments are applied first to any unpaid interest.                       40,000

Notes payable to Rulon L.  Tolman  with  interest at 10% per annum
from November 13, 1996, note is unsecured and is payable on
demand.  Payments are applied first to any unpaid interest.              40,000
                                                                        -------

Total Notes Payable - Stockholder                                       $80,000
                                                                        =======


4.   STOCK OPTIONS

     On December 8, 1988, the board of directors of Biogan allocated 2,000,000
     shares of the Company's authorized common stock shares for a stock
     incentive plan to be issued as determined by the board at an option price
     of not less than placement offering of any private placement offering of
     the Company's common stock. No options have been granted or exercised under
     this stock incentive plan.


5.   STOCKHOLDERS' EQUITY (Deficit)

     Following is a table of Biogan International Inc.'s stock and equity
     transactions:

<TABLE>
<CAPTION>

                                                        In (000)
                                                        Common         .001/share       Paid-In       Accumulated           Total
                                                        Shares           Amount         Capital         Deficit            Equity

------------------------------------------------------------------------------------------------------------------------------------
<S>                                                        <C>        <C>             <C>             <C>               <C>
A)  Ronney shares                                           2,250     $     2,250     $    22,750     $                 $    25,000
B)  Biogan merger                                          17,750          17,750          88,750                           106,500
C)  Stock Subscriptions                                     3,637           3,637         108,602                           112,239
D)  Expenses/Service Mgmt Grp                              43,400          43,400          17,894                            61,294
E)  Shares for Cash                                         7,380           7,380       1,464,107                         1,471,487
F)  Shares for Restitution                                 10,706          10,706       2,665,704                         2,676,410
G)  Deficit:
     2/5/88-6/26/94                                                                                       (142,733)        (142,733)
     6/27/94-06/30/99                                                                                   (4,675,332)      (4,675,332)
                                                      ------------------------------------------------------------------------------
     Totals                                                85,123     $    85,123     $ 4,367,807     $ (4,818,065)     $  (365,135)
                                                      ===========     ===========     ===========     ============      ===========
</TABLE>





                             See Accountants' Report

                                       -9-

                             WADSWORTH & SMITH, P.C.
                          CERTIFIED PUBLIC ACCOUNTANTS
<PAGE>


                           BIOGAN INTERNATIONAL, INC.
                          (A DEVELOPMENT-STAGE COMPANY)
                    NOTES TO FINANCIAL STATEMENTS - Continued
                                  JUNE 30, 1999


A.   Issuance of 2,250,000 shares of Ronney, a Delaware Corporation.

B.   Exchange of Biogan (an Oregon Corporation), 5,000,000 shares for 17,750,000
     shares of Ronney. Ronney and Biogan merged and changed its name to Biogan
     International, Inc.

C.   Issuance of a stock subscription to Tower Enterprises International, Inc.
     (a European Corporation), a former 84% shareholder in Biogan International,
     Inc. 11,512,653 of the 15,150,000 original stock subscription has been
     canceled as of December 31, 1998.

D.   Shares issued to new management for expenses/services incurred in
     re-starting Biogan International, Inc. were valued at or above the market
     value of the common stock listed on NASDAQ BB at $.001 to $.25 per share at
     the time the expenses were incurred; the services were rendered; and the
     Board of Directors' resolution approving the issuance was made. See
     "Statement of Stockholders' Equity" and Note 7.

E.   Cash shares and shares issued for services rendered and for loan payments
     by parties other than management.

F.   From 1990 through May 1994 Biogan International, Inc. was under the control
     of prior management and affiliates. Effective December 31, 1996, the
     Company completed its review stock transactions and has issued 14,258,635
     shares of common stock as restitution to investors who substantiated their
     claims of purchasing stock from the Company but had not received stock
     certificates. In addition, the Company has obtained a court judgment
     canceling 15,150,000 shares of common stock issued in "C" above, and
     4,117,653 shares issued to Tower Enterprises International, Inc. in "B"
     above. The company recovered 3,553,000 shares relating to the above court
     order on November 20, 1998. This transaction results in a net total of
     10,705,635 shares for restitution being issued.

G.   Biogan International has effectively had two development stages:

(1)  From February 5, 1988, through June 27, 1994. During this period the
     company was dormant for approximately four years.

(2)  The second development stage (June 27, 1994, through June 30, 1999) is and
     continues under the new management group set forth in D above.

6.   COMMITMENTS AND CONTINGENCIES

     A.   SHARES FOR RESTITUTION As set forth in Note 5F "Shareholders' Equity"
          Biogan was committed through December 31, 1997, to issue shares to
          replace shares sold by Tower International's US agent, Tower Holdings,
          Ltd.

     B.   OTHER

          In connection with the Company's plans to become operational,
          management will focus on the funding and marketing of the InterCorp
          Motor as a consultant to InterCorp, Inc. In addition, management is
          presently seeking other business opportunities to acquire, develop
          and/or joint venture. In order to continue with the business of
          InterCorp and/or Biogan, it will be necessary to raise additional
          capital which management intends to obtain through private placements
          of common stock or other securities, with qualified investors or other
          business organizations. It is uncertain whether the Company will be
          successful in raising the needed capital. However, as discussed in
          Note 1 the Company remains a development-stage company.


                             See accountants' Report

                                      -10-

                             WADSWORTH & SMITH, P.C.
                          CERTIFIED PUBLIC ACCOUNTANTS
<PAGE>


                           BIOGAN INTERNATIONAL, INC.
                          (A DEVELOPMENT-STAGE COMPANY)
                    NOTES TO FINANCIAL STATEMENTS - Continued
                                  JUNE 30, 1999


7.   RELATED PARTY TRANSACTIONS

     Pursuant to a board of directors meeting held in July 1995, the Company
     issued common stock to the following related parties in exchange for
     expenses incurred on behalf of the Company and for services rendered: (The
     schedule below has been adjusted to reflect shares issued to the Advisory
     Board from each of the related parties listed below - see Note 12)



<TABLE>
<CAPTION>
               Date                                                   Market          Issue               Expense/
            Expense/Service                    Numbered of            Price           Price               Service
Name         Rendered                          shares issued          per share       per share           Amount

<S>      <C>                                      <C>                  <C>             <C>             <C>
     Glazier Family Trust

         during 1994                              10,079,178           $.001           $.001           $   10,079
         during first quarter of 1995                245,000            .001            .003                  735
         during second quarter of 1995               148,300            .010            .010                1,483
         during third quarter of 1995                 20,830            .100            .100                2,083
         during fourth quarter of 1995                 6,692            .125            .250                1,673
         --------------------------------------------------------------------------------------------------------
                                                  10,500,000                                           $   16,053

     Ronald J. Tolman Family Trust

         during 1994                               8,982,729           $.001           $.001           $    8,983
         during first quarter of 1995                328,333            .001            .003                  985
         during second quarter of 1995               154,300            .010            .010                1,543
         during third quarter of 1995                 21,150            .100            .100                2,115
         during fourth quarter of 1995                 6,888            .125            .250                1,722
         --------------------------------------------------------------------------------------------------------
                                                   9,493,400                                           $   15,348

     Rulon L. Tolman

         during 1994                               9,386,667           $.001           $.001           $    9,387
         during first quarter of 1995                333,333            .001            .003                1,000
         during second quarter of 1995               150,000            .010            .010                1,500
         during third quarter of 1995                 20,000            .100            .100                2,000
         during fourth quarter of 1995                10,000            .125            .250                2,500
         --------------------------------------------------------------------------------------------------------
                                                   9,900,000                                           $   16,387
</TABLE>

     Biogan sub-leased office space (month to month) from a company owned by
     Ronald J. Tolman until December 31, 1996. Total rental expense for the
     period from inception February 5, 1988, until June 30, 1999, amounted to
     $10,233. See Note 3 for details on notes payable due stockholders. Ron
     Tolman, Rulon Tolman and Jacque Tolman have accrued wages for the two year
     period ending December 31, 1998, of $96,600, $63,800 and $10,800
     respectively.

8.   USE OF ESTIMATES

     The preparation of financial statements in conformity with generally
     accepted accounting principles requires management to make estimates and
     assumptions that affect the reported amounts of assets and liabilities and
     disclosures 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.





                             See Accountants' Report

                                      -11-

                             WADSWORTH & SMITH, P.C.
                          CERTIFIED PUBLIC ACCOUNTANTS
<PAGE>


                           BIOGAN INTERNATIONAL, INC.
                          (A DEVELOPMENT-STAGE COMPANY)
                    NOTES TO FINANCIAL STATEMENTS - Continued
                                  JUNE 30, 1999


9.   LEASES

     The Company conducts its operations from facilities that are leased under a
     noncancelable operating lease that expired on May 31, 1999. The Company is
     presently on a month to month lease.

     Rental expense for the six months ended June 30, 1999, amounted to $2,611.
     Rental expense for the period from inception February 5, 1988, through June
     30, 1999, amounted to $37,287. See Note 7 for related party rental
     transactions.

10.  CORPORATE NAME CHANGE

     The Board of Directors consented to change the name of the corporation from
     Biogan Medical International, Inc. to Biogan International , Inc. This
     action was deemed necessary to avoid the confusion that has developed from
     the word "medical" in the name when the main emphasis of the company is to
     promote the development of the electro-magnetic motor. The name change was
     recorded by the state of Delaware on September 5, 1997.

11.  YEAR 2000 COMPLIANCE

     The Company will begin a Year 2000 compliance project in June 1999. The
     project will encompass upgrading the server and all proprietary software
     and non-proprietary software. The project will be completed by September
     1999.

     The Company is in the process of assessing Year 2000 issues not related to
     its internal systems, including issues with suppliers and consultants. Due
     to the general uncertainty of the Year 2000 readiness of suppliers and
     consultants, the Company is unable to determine at this time whether the
     consequences of Year 2000 failures will have a material impact on the
     Company's results of operations, liquidity or financial condition. The
     Company believes that interruptions of normal operations will not be
     affected.

     Total expenditures for the Year 2000 project are estimated to be $5,000 in
     fiscal year 1999. There were no Year 2000 related costs in the current
     fiscal year.

     The Company is currently formulating contingency plans in the event of a
     Year 2000 failure. The Company expects that a contingency plan will be in
     place by September 30, 1999.


                             See Accountants' Report

                                      -12-

                             WADSWORTH & SMITH, P.C.
                          CERTIFIED PUBLIC ACCOUNTANTS