**UNITED      STATES**

**SECURITIES      AND EXCHANGE COMMISSION**

**Washington,      DC 20549**

**FORM      10-QSB**

**0-9314**

**ACCESS      PHARMACEUTICALS, INC.**

|  **Delaware **                           |   |   | ** 83-0221517   **                         |
|---------------------------------------------------------|--------|--------|----------------------------------------------------------------|
|  (State                or Other Jurisdiction  |   |   |  (I.R.S. Employer                Identification No.) |
|  of                Incorporation or Organization)  |   |   |                                                           |   |

**2600      Stemmons Frwy, Suite 176, Dallas, TX 75207 **

----

**ACCESS      PHARMACEUTICALS, INC.**

**INDEX**

|  Item 1.   |  Condensed Consolidated Financial Statements:                                                     |           |   |
|---------------------------|--------------------------------------------------------------------------------------------------------|----------------|--------|
|                      |                                                                                                   |           |   |
|                      |  Condensed Consolidated Balance Sheets at                                                    |           |   |
|                      |  September 30, 2007 (unaudited) and December 31, 2006                (audited)          |  13       |   |
|                      |                                                                                                   |           |   |
|                      |  Condensed Consolidated Statements of Operations                (unaudited) for the               |           |   |
|                      |  three and                nine months ended September 30, 2007 and September 30, 2006   |  14       |   |
|                      |                                                                                                   |           |   |
|                      |  Condensed Consolidated Statements of Cash Flows                (unaudited) for the     |           |   |
|                      |  nine months ended September 30, 2007 and September                30, 2006             |   15 |   |
|                      |                                                                                                   |           |   |
|                      |  Notes to Unaudited Condensed Consolidated Financial                Statements               |   16 |   |
|                      |                                                                                                   |           |   |
|  Item 2.             |  Management's Discussion and Analysis or Plan of                Operation                         |   2  |   |
|                      |                                                                                                   |           |   |
|  Item 3.             |  Controls and Procedures                                                                          |  8        |   |
|                      |                                                                                                   |           |   |
|                      |  Risk Factors                                                                                     |  9        |   |

|  Item                1. |  Legal Proceedings                                                        |  10 |   |
|------------------------------|--------------------------------------------------------------------------------|----------|--------|
|                         |                                                                           |     |   |
|  Item 2.                |  Unregistered Sales of Equity Securities and Use of              Proceeds |  10 |   |
|                         |                                                                           |     |   |
|  Item 3.                |  Defaults Upon Senior Securities                                     |  10 |   |
|                         |                                                                           |     |   |
|  Item 4.                |  Submission of Matters to a Vote of Security              Holders    |  10 |   |
|                         |                                                                           |     |   |
|  Item 5.                |  Other Information                                                   |  10 |   |
|                         |                                                                           |     |   |
|  Item 6.                |  Exhibits                                                                 |  10 |   |
|                         |                                                                           |     |   |

|  SIGNATURES  |   |  12 |   |
|------------------------|--------|----------|--------|

----

**PART        I -FINANCIAL INFORMATION**

*This        Quarterly Report (including the information incorporated by reference) contains        forward-looking statements within the meaning of Section 27A of the Securities        Act of 1933, as amended, and Section 21E of the Securities Exchange Act of        1934,        as amended, that involve risks and uncertainties including, but not limited        to        the uncertainties associated with research and development activities, clinical        trials, our ability to raise capital, the timing of and our ability to achieve        regulatory approvals, dependence on others to market our licensed products,        collaborations, future cash flow, the timing and receipt of licensing and        milestone revenues, the future success of our marketed products and products        in        development, our sales projections, our ability to close the Somanta merger        and,        if it closes, our ability to integrate Somanta’s business with ours, the sales        projections of our licensing partners, our ability to achieve licensing        milestones and other risks described below as well as those discussed elsewhere        in this Quarterly Report, documents incorporated by reference and other        documents and reports that we file periodically with the Securities and Exchange        Commission. These statements include, without limitation, statements relating        to        our ability to continue as a going concern, anticipated product approvals        and        timing thereof, product opportunities, clinical trials and U.S. Food and        Drug        Administration (“FDA”) applications, as well as our drug development strategy,        our clinical development organization, expectations regarding our rate of        technological developments and competition, the terms of future licensing        arrangements, our ability to secure additional financing for our operations        and        our expected cash burn rate. These statements relate to future events or        our        future financial performance. In some cases, you can identify forward-looking        statements by terminology such as “may,” “will,” “should,” “expects,” “plans,”“could,” “anticipates,” “believes,” “estimates,” “predicts,” “potential” or“continue” or the negative of such terms or other comparable terminology. These        statements are only predictions and involve known and unknown risks,        uncertainties and other factors, including the risks outlined under “Risk        Factors,” that may cause our or our industry’s actual results, levels of        activity, performance or achievements to be materially different from any        future        results, levels or activity, performance or achievements expressed or implied        by        such forward-looking statements. *

*Although        we believe that the expectations reflected in the forward-looking statements        are        reasonable, we cannot guarantee future results, levels of activity, performance        or achievements. We are under no duty to update any of the forward-looking        statements after the date of filing this Form 10-QSB to conform such statements        to actual results.*

**ITEM        1**
**FINANCIAL        STATEMENTS**

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

**OVERVIEW**

----

**Products**

**ACCESS        PRODUCT PORTFOLIO**

| **Compound**                                                                 |   | **Originator**                     |   |  **Technology** |   | **Indication** |   | **FDA                  Filing**          |   | **Clinical****Stage                  (1)** |
|------------------------------------------------------------------------------|--------|------------------------------------|--------|----------------------|--------|----------------|--------|------------------------------------------|--------|--------------------------------------------|
|                                                                         |   |                               |   |                 |   |           |   |                                     |   |                                       |
| MuGard™                                                                |   | Access                             |   | MucoadhesiveLiquid   |   | Mucositis      |   | 510(k)                                   |   | Marketing                  clearance       |
| ProLindacTM                  (PolymerPlatinate,                  AP5346) (2) |   | Access                  - U London |   | Syntheticpolymer     |   | Cancer         |   | Clinical                  Development(3) |   | Phase                  II                  |
| Oral                  Insulin                                                |   | Access                             |   | Cobalamin            |   | Diabetes       |   | Research                                 |   | Pre-Clinical                               |
| Oral                  Delivery System                                        |   | Access                             |   | Cobalamin            |   | Various        |   | Research                                 |   | Pre-Clinical                               |
| Cobalamin-Targeted                  Therapeutics                        |   | Access                             |   | Cobalamin            |   | Anti-tumor     |   | Research                                 |   | Pre-Clinical                               |

**Approved        Products**

----

**Products        in Development Status**

**RECENT        EVENTS**

----

**LIQUIDITY        AND CAPITAL RESOURCES**

----

**THIRD        QUARTER 2007 COMPARED TO THIRD QUARTER 2006**

| ·   | costs                for product manufacturing for a new ProLindac clinical trial expected                to                start in 2008 ($214,000); |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------|
| ·   | higher                salary and related cost due to the hiring of additional scientific                staff                ($30,000); and |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------|
| ·   | other                net increases ($25,000). |
|--------------------|-----------------------------------------------|
| ·   | higher                investor relations expenses ($149,000) due to our increased investor                relations efforts; |
|--------------------|------------------------------------------------------------------------------------------------------------------------------|
| ·   | higher                salary related expenses due to stock option expenses ($156,000);                and |
|--------------------|-----------------------------------------------------------------------------------------------------------|
| ·   | higher                salary expenses ($65,000). |
|--------------------|--------------------------------------------------|
| ·   | lower                patent expenses ($90,000); |
|--------------------|-------------------------------------------------|
| ·   | lower                professional fees ($59,000); and |
|--------------------|-------------------------------------------------------|
| ·   | other                net decreases ($21,000). |
|--------------------|-----------------------------------------------|

----

**NINE**
**        MONTHS ENDED SEPTEMBER 30, 2007 COMPARED TO NINE MONTHS ENDED SEPTEMBER 30,        2006**

| ·   | lower                costs for product manufacturing for ProLindac ($198,000). Product                manufacturing was completed early in 2006 which we believe is adequate                to                supply drug product for our current ovarian cancer                trial; |
|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| ·   | lower                costs of clinical trials for ProLindac                ($170,000). We incurred start-up costs for the clinical trial in                early                2006; and |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| ·   | other                net decreases ($53,000). |
|--------------------|-----------------------------------------------|
| ·   | higher                salary and related cost due to the hiring of additional scientific                staff                ($121,000); and |
|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------|
| ·   | higher                scientific consulting costs ($63,000). |
|--------------------|--------------------------------------------------------------|
| ·   | higher                salary related expenses due mainly to stock option expenses                ($580,000); |
|--------------------|--------------------------------------------------------------------------------------------------------------|
| ·   | higher                investor relations expenses ($368,000) due to our increased investor                relations efforts; |
|--------------------|------------------------------------------------------------------------------------------------------------------------------|
| ·   | higher                salary and related costs ($178,000); and |
|--------------------|----------------------------------------------------------------|
| ·   | higher                travel costs ($58,000). |
|--------------------|-----------------------------------------------|
| ·   | lower                patent expenses ($45,000); and |
|--------------------|-----------------------------------------------------|
| ·   | other                net decreases ($16,000). |
|--------------------|-----------------------------------------------|

----

**Recent        Accounting Pronouncements **

*Fair        Value Measurements *
*,*

*The        Fair Value Option for Financial Assets and Financial Liabilities Including        an        amendment of FASB Statement No. 115 *
*,*

**ITEM        3**
**CONTROLS        AND PROCEDURES**

----

**RISK        FACTORS **

**We        have limited liquid assets.**

**The        proposed merger between Access and Somanta may not result in benefits to        the        combined company because of integration and other challenges.**

|   | • |   | unanticipated                  issues in integrating information, communications and other systems; |
|--------|---------|--------|-----------------------------------------------------------------------------------------------------|

|   | • |   | retaining                  key employees; |
|--------|---------|--------|-------------------------------------------|

|   | • |   | consolidating                  corporate and administrative infrastructures; |
|--------|---------|--------|------------------------------------------------------------------------------|

|   | • |   | the                  diversion of management’s attention from ongoing business concerns; and |
|--------|---------|--------|----------------------------------------------------------------------------------------------------|

|   | • |   | coordinating                  geographically separate organizations. |
|--------|---------|--------|----------------------------------------------------------------------|

----

**PART        II -- OTHER INFORMATION**

**ITEM        1**
**LEGAL        PROCEEDINGS**

**ITEM        2**
**UNREGISTERED        SALES OF EQUITY SECURITIES AND USE OF PROCEEDS**

**ITEM        3**
**DEFAULTS        UPON SENIOR SECURITIES**

**ITEM        4**
**SUBMISSION        OF MATTERS TO A VOTE OF SECURITY HOLDERS**

**ITEM        5**
**OTHER        INFORMATION**

| **ITEM** | ** 6 ****EXHIBITS** |
|----------|-------------------------------|

| 2.2 | Agreement                  and Plan of Merger, by and among Access Pharmaceuticals, Inc.,                  Somanta                  Acquisition Corporation, Somanta Pharmaceuticals, Inc., Somanta                  Incorporated and Somanta Limited, dated April 18, 2007. (Incorporated                  by                  reference to Exhibit 2.1 to our Form 8-K dated April 18,                  2007) |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3.0 | Articles                  of incorporation and bylaws: |
|-----|--------------------------------------------------------|

| 3.1 | Certificate                  of Incorporation (Incorporated by Reference to Exhibit 3(a) of                  our Form                  8-B dated July 12, 1989, Commission File Number                  9-9134) |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3.2 | Certificate                  of Amendment of Certificate of Incorporation filed August 21,                  1992 |
|-----|------------------------------------------------------------------------------------------------------------------|

| 3.3 | Certificate                  of Merger filed January 25, 1996. (Incorporated by reference to                  Exhibit E                  of our Registration Statement on Form S-4 dated December 21, 1995,                  Commission File No. 33-64031) |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3.4 | Certificate                  of Amendment of Certificate of Incorporation filed January 25,                  1996.                  (Incorporated by reference to Exhibit E of our Registration Statement                  on                  Form S-4 dated December 21, 1995, Commission File No.                  33-64031) |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3.5 | Certificate                  of Amendment of Certificate of Incorporation filed July 18, 1996.                  (Incorporated by reference to Exhibit 3.8 of our Form 10-K for                  the year                  ended December 31, 1996) |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3.6 | Certificate                  of Amendment of Certificate of Incorporation filed June 18, 1998.                  (Incorporated by reference to Exhibit 3.8 of our Form 10-Q for                  the quarter                  ended June 30, 1998) |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3.7 | Certificate                  of Amendment of Certificate of Incorporation filed July 31, 2000.                  (Incorporated by reference to Exhibit 3.8 of our Form 10-Q for                  the quarter                  ended March 31, 2001) |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| 3.8 | Certificate                  of Designations of Series A Junior Participating Preferred Stock                  filed                  November 7, 2001 (Incorporated by reference to Exhibit 4.1.h of                  our                  Registration Statement on Form S-8, dated December 14, 2001, Commission                  File No. 333-75136) |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3.9 | Amended                  and Restated Bylaws (Incorporated by reference to Exhibit 3.1 of                  our Form                  10-Q for the quarter ended June 30,                  1996) |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.43 | Amendment                  to 7.0% (Subject to Adjustment) Convertible Promissory Notes Due                  November                  16, 2007, dated October 24, 2007 by and between us and Oracle Partners                  LP                  and affiliates |
|-------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.44 | Amendment                  to Amended and Restated 7.5% Secured Convertible Promissory Notes                  Due                  November 15, 2007, dated October 24, 2007 by and between us and                  SCO                  Capital Partners LLC, Beach Capital LLC and Lake End Capital                  LLC |
|-------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 31.1 | Certification                  of Chief Executive Officer of Access Pharmaceuticals, Inc. pursuant                  to                  Rule 13a-14(a)/15d-14(a) |
|------|------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 31.2 | Certification                  of Chief Financial Officer of Access Pharmaceuticals, Inc. pursuant                  to                  Rule 13a-14(a)/15d-14(a) |
|------|------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 32.1* | Certification                  of Chief Executive Officer of Access Pharmaceuticals, Inc. pursuant                  to 18                  U.S.C. Section 1350 |
|-------|----------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 32.2* | Certification                  of Chief Financial Officer of Access Pharmaceuticals, Inc. pursuant                  to 18                  U.S.C. Section 1350 |
|-------|----------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

**SIGNATURES**

| Date:  | November                14, 2007 | By:                                                         | /s/                Stephen R. Seiler   |
|--------|----------------------------------|-------------------------------------------------------------|----------------------------------------|
|   |                             | Stephen                R. Seiler                            |
|   |                             | President                and Chief Executive Officer        |
|   |                             | (Principal                Executive Officer)                |
|   |                             |                                                        |
| Date:  | November                14, 2007 | By:                                                         | /s/                Stephen B. Thompson |
|   |                             | Stephen                B. Thompson                          |
|   |                             | Vice                President and Chief Financial Officer   |
|   |                             | (Principal                Financial and Accounting Officer) |
|   |                             |                                                        |

----

**Access      Pharmaceuticals, Inc. and Subsidiaries**

|                                                                                                                                                                                                    |   | September                30, 2007 |                         | December                31, 2006 |          |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------------|------------------------------|----------------------------------|---------------|
| ASSETS                                                                                                                                                                                                  |   | (unaudited)                       |                         |  (audited)                  |          |
| Current                assetsCash                and cash equivalents Short                term investments, at costReceivables                Prepaid                expenses and other current assets |   | $                       | 661,000515,000861,000530,000 |                             | $   | 1,194,0003,195,000359,000283,000 |   |
|  Total                current assets                                                                                                                                                               |   |                              | 2,567,000                    |                             |          | 5,031,000 |   |

|  Property                and equipment, net                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |  156,000       |                                                     |  212,000 |                |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------|----------------------------------------------------------|---------------|---------------------|
|  Debt                issuance costs, net                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |  -             |                                                     |  158,000 |                |
|  Patents,                net                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |  752,000       |                                                     |  878,000 |                |
|  Licenses,                net                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |                | -                                                        |          |                | 25,000 |   |
|  Other                assets                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |                | 25,000                                                   |          |                | 122,000 |   |
|  Total                assets                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   | $                   | 3,500,000                                                |          | $                   | 6,426,000 |   |
|  LIABILITIES                AND STOCKHOLDERS' DEFICIT                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |                |                                                     |          |                |   |   |
|  Current                liabilitiesAccounts                payable and accrued expensesAccrued                interest payableDeferred                revenuesCurrent                portion of long-term debt, net of discount $0 at September                30, 2007 and $2,062,000 at December 31, 2006                                                                                                                                                                                                                                         |   | $    | 1,595,0001,023,0001,167,000 11,406,000              |          | $    | 1,226,000581,000173,000 8,833,000 |    |
| Total                current liabilities                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |                | 15,191,000                                               |          |                | 10,813,000 |   |
|  Long-term                debt                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |                | 5,500,000                                                |          |                | 5,500,000 |   |
|  Total                liabilities                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |                | 20,691,000                                               |          |                | 16,313,000 |   |
|  Commitments                and contingencies                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |                | -                                                        |          |                | - |   |
| Stockholders'                deficitPreferred                stock - $.01 par value; authorized 2,000,000 shares;none                issued or outstandingCommon                stock - $.01 par value; authorized 100,000,000 shares;                  issued,                3,575,114 at September 30, 2007 and 3,535,108 atDecember                31, 2006Additional                paid-in capitalNotes                receivable from stockholdersTreasury                stock, at cost - 163 sharesAccumulated                deficit |   |                | -  36,00069,687,000(1,045,000(4,000(85,865,000 | )))           |                | -  35,00068,799,000(1,045,000(4,000(77,672,000 | ))) |
|  Total                stockholders' deficit                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |                | (17,191,000                                              | )             |                | (9,887,000 | ) |
|   Total                liabilities and stockholders' deficit                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   | $                   | 3,500,000                                                |          | $                   | 6,426,000 |   |

----

**Access      Pharmaceuticals, Inc. and Subsidiaries**

|     |   |   | Three                months ended   |   |   | Nine                months ended   |   |
|----------|--------|--------|------------------------------------------|--------|--------|-----------------------------------------|--------|
|     |   |   | September                30,             |   |   | September                30             |   |
|     |   |   | 2007                                     |   |   | 2006                                    |   |   | 2007 |   |   | 2006 |   |
| Revenues |   |   |                                     |   |   |                                    |   |   |   |   |   |   |   |

| License                revenues                  |   | $      | 6,000      |   | $      | -          |   | $      | 6,000      |   | $      | -          |   |
|--------------------------------------------------|--------|--------|------------|--------|--------|------------|--------|--------|------------|--------|--------|------------|--------|
|                                             |   |   |       |   |   |       |   |   |       |   |   |       |   |
| Expenses                                    |   |   |       |   |   |       |   |   |       |   |   |       |   |
| Research                and development          |   |   | 596,000    |   |   | 379,000    |   |   | 1,532,000  |   |   | 1,769,000  |   |
| General                and administrative        |   |   | 1,000,000  |   |   | 800,000    |   |   | 3,252,000  |   |   | 2,129,000  |   |
| Depreciation                and amortization     |   |   | 61,000     |   |   | 77,000     |   |   | 210,000    |   |   | 231,000    |   |
| Total                expenses                    |   |   | 1,657,000  |   |   | 1,256,000  |   |   | 4,994,000  |   |   | 4,129,000  |   |
|                                             |   |   |       |   |   |       |   |   |       |   |   |       |   |
| Loss                from operations              |   |   | (1,651,000 | )      |   | (1,256,000 | )      |   | (4,988,000 | )      |   | (4,129,000 | )      |
|                                             |   |   |       |   |   |       |   |   |       |   |   |       |   |
| Interest                and miscellaneous income |   |   | 12,000     |   |   | 86,000     |   |   | 72,000     |   |   | 278,000    |   |
| Interest                and other expense        |   |   | (318,000   | )      |   | (1,976,000 | )      |   | (3,277,000 | )      |   | (5,244,000 | )      |

| Unrealized                gain (loss) on fair value ofwarrants                and conversion feature          |   |   | -          |    |   | 1,131,000  |    |   | -          |   |   | (1,107,000  | )      |
|---------------------------------------------------------------------------------------------------------------|--------|--------|------------|--------------|--------|------------|--------------|--------|------------|--------|--------|-------------|--------|
|                                                                                                          |   |   | (306,000   | )            |   | (759,000   | )       |   | (3,205,000 | )      |   | (6,073,000  | )      |
|  Net                loss                                                                                 |   | $      | (1,957,000 | )            | $      | (2,015,000 | )            | $      | (8,193,000 | )      | $      | (10,202,000 | )      |
|                                                                                                          |   |   |       |         |   |       |         |   |       |   |   |        |   |
| Basic                and diluted loss per common shareNet                loss allocable to commonshareholders |   | $      | (0.55      | )            | $      | (0.57      | )            | $      | (2.31      | )      | $      | (2.89       | )      |
|                                                                                                          |   |   |       |         |   |       |         |   |       |   |   |        |   |
| Weighted                average basic and dilutedcommon                shares outstanding                     |   |   | 3,575,114  |         |   | 3,534,408  |         |   | 3,544,181  |   |   | 3,530,941   |   |

----

**Access      Pharmaceuticals, Inc. and Subsidiaries**

|                                                                                                  |   |  Nine                months ended September 30, |       |
|-------------------------------------------------------------------------------------------------------|--------|------------------------------------------------------|------------|
|                                                                                                  |   |  2007                                           |       |  2006 |   |
| Cash                flows from operating activities:                                                  |   |                                                 |       |   |   |
| Net                loss                                                                               |   | $                                                    | (8,193,000 | ) | $ | (10,202,000 | ) |
| Adjustments                to reconcile net loss to cash used in                operating activities: |   |                                                 |       |   |   |   |   |
| Depreciation                and amortization                                                     |   |                                                 | 210,000    |   |   | 230,000 |   |
| Stock                option expense                                                                   |   |                                                 | 810,000    |   |   | 171,000 |   |
| Stock                compensation expense                                                             |   |                                                 | -          |   |   | 69,000 |   |
| Stock                issued for compensation                                                          |   |                                                 | 44,000     |   |   | - |   |
| Amortization                of debt costs and discounts                                               |   |                                                 | 2,316,000  |   |   | 4,192,000 |   |
| Unrealized                loss on fair value of warrants andconversion                feature         |   |                                                 | -          |   |   | 1,107,000 |   |

| Loss on                sale of asset                                                            |   |   | 2,000           |   |   | -          |   |
|------------------------------------------------------------------------------------------------------|--------|--------|-----------------|--------|--------|------------|--------|
| Change                in operating assets and liabilities:                                           |   |   |            |   |   |       |   |
| Receivables                                                                                          |   |   | (502,000        | )      |   | 14,000     |   |
|    Prepaid                expenses and other current assets                           |   |   | (247,000        | )      |   | 143,000    |   |
| Other                assets                                                                          |   |   | 1,000           |   |   | 128,000    |   |
| Accounts                payable and accrued expenses                                                 |   |   | 369,000         |   |   | (849,000   | )      |
| Accrued                interest payable                                                              |   |   | 953,000         |   |   | 805,000    |   |
| Deferred                revenue                                                                      |   |   | 994,000         |   |   | -          |   |
| Net                cash used in operating activities                                                 |   |   | (3,243,000      | )      |   | (4,192,000 | )      |
|                                                                                                 |   |   |            |   |   |       |   |
| Cash                flows from investing activities:                                                 |   |   |            |   |   |       |   |
| Capital                expenditures                                                                  |   |   | (18,000         | )      |   | (3,000     | )      |
| Proceeds                from sale of asset                                                           |   |   | 13,000          |   |   | -          |   |
| Redemptions                of short term investments and certificates                of deposit, net |   |   | 2,680,000       |   |   | (98,000    | )      |
| Net                cash provided by (used in) investing activities                                   |   |   | 2,675,000       |   |   | (101,000   | )      |
| Cash                flows from financing activities:                                                 |   |   |            |   |   |       |   |
| Payments                of notes payable                                                             |   |   | -               |   |   | (106,000   | )      |
| Proceeds                from secured convertible notes payable                                       |   |   | -               |   |   | 4,532,000  |   |
| Exercise                of stock options                                                             |   |   | 35,000          |   |   | -          |   |
| Net                cash provided by financing activities                                             |   |   | 35,000          |   |   | 4,426,000  |   |
|                                                                                                 |   |   |            |   |   |       |   |
| Net                (decrease) increase in cash and cash equivalents                                  |   |   | (533,000        | )      |   | 133,000    |   |
| Cash                and cash equivalents at beginning of period                                      |   |   | 1,194,000       |   |   | 349,000    |   |
| Cash                and cash equivalents at end of period                                            |   | $      | 661,000         |   | $      | 482,000    |   |
|                                                                                                 |   |   |            |   |   |       |   |
|                                                                                                 |   |   |            |   |   |       |   |
| *Supplemental                cash flow information:*                                                 |   |   |            |   |   |       |   |
| *Cash                paid for interest*                                                              |   | *$*    | *5,000*         |   | *$*    | *5,000*    |   |
| *Accrued                interest capitalized*                                                   |   |   | *511,000*  |   |   | -     |   |

----

**Access      Pharmaceuticals, Inc. and Subsidiaries**

| **(1)  ** | **Interim                Financial Statements** |
|---------------------|-------------------------------------------------|

**Intangible      Assets**

----

|                                                              |   | September                30, 2007 |   | December                31, 2006 |    |
|-------------------------------------------------------------------|--------|-----------------------------------|--------|----------------------------------|---------|
|                                                              |   | Grosscarryingvalue                |   |  Accumulatedamortization    |    | Grosscarryingvalue |   |  Accumulatedamortization |   |
| Amortizable                intangible assets PatentsLicenses |   | $                            | 1,680- |                             | $  | 928- |   | $ | 1,680500 |   | $  | 802475 |   |
| Total                                                             |   | $                                 | $1,680 |                             | $       | 928 |   | $ | 2,180 |   | $ | 1,277 |   |

|  2007        |   | $      | 42        |   |
|-------------------|--------|--------|-----------|--------|
|  2008   |   |   | 168       |   |
|  2009        |   |   | 168       |   |
|  2010        |   |   | 168       |   |
|  2011        |   |   | 168       |   |
|  Thereafter  |   |   | 38        |   |
|              |   |   |      |   |
|  Total  |   | $      | 752  |   |

**Liquidity**

**(4)      **
**Stock      Based Compensation**

----

|                                   |         |                    |   |
|----------------------------------------|--------------|-------------------------|--------|
|                                   |         |                    |   |
|                                   |    | 9/30/07                 |   |
| Expected                life           |    | 2.0                yrs. |   |
| Risk                free interest rate |    | 4.63                    | %      |
| Expected                volatility(a)  |    | 141                     | %      |
| Expected                dividend yield |    | 0.0                     | %      |
|                                   |         |                    |   |

| (a) | Reflects                movements in our stock price over the most recent historical period                equivalent to the expected life. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------|

**(5)      **
**Income      Taxes**

*,*

**(6)      **
**Debt**

|                                                    |   | September                30,2007 |       | December                31,2006 |   |
|---------------------------------------------------------|--------|----------------------------------|------------|---------------------------------|--------|
| Convertible                note - Oracle and affiliates |   | $                                | 4,015,000  |                            | $      | 4,015,000 |   |
| Convertible                note                         |   |                             | 5,500,000  |                            |   | 5,500,000 |   |
| Convertible                note                         |   |                             | 1,391,000  |                            |   | 880,000 |   |
|                                                    |   |                             | 10,906,000 |                            |   | 10,395,000 |   |
| Discount                                                |   |                             | -          |                            |   | (456,000 | ) |
|                                                    |   |                             | 10,906,000 |                            |   | 9,939,000 |   |
|                                                    |   |                             |       |                            |   |   |   |
| Convertible                note - SCO and affiliates    |   |                             | 6,000,000  |                            |   | 6,000,000 |   |
| Discount                                                |   |                             | -          |                            |   | (1,606,000 | ) |
|                                                    |   |                             | 6,000,000  |                            |   | 4,394,000 |   |
|                                                    |   |                             |       |                            |   |   |   |
| Total                                                   |   | $                                | 16,906,000 |                            | $      | 14,333,000 |   |
|                                                    |   |                             |       |                            |   |   |   |
| Short                term                               |   | $                                | 11,406,000 |                            | $      | 8,833,000 |   |
| Long                term                                |   |                             | 5,500,000  |                            |   | 5,500,000 |   |
| Total                                                   |   | $                                | 16,906,000 |                            | $      | 14,333,000 |   |
|                                                    |   |                             |       |                            |   |   |   |

----

**(7)      **
**Subsequent      Events**

----