UNITED STATES

SECURITIES AND EXCHANGE
		COMMISSION

WASHINGTON, D.C. 20549

FORM 10-QSB

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


For the quarterly period ended March 31,
		2007

o
			 TRANSITION REPORT PURSUANT TO
				  SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934


For the transition period from _________ to
		_________

Commission File No. 0-17119

QUANTRX BIOMEDICAL CORPORATION

(Name of Small Business Issuer as Specified
		in Its Charter)



| | Nevada(State of
			 Other Jurisdiction ofIncorporation or
			 Organization) |  | 33-0202574(I.R.S. EmployerIdentification Number) | 
| | --------------------------------------------------------------------------- |  | ------------------------------------------------ | 

100 S. Main Street, Suite 300, Doylestown,
		PA 18901

(Address of Principal Executive Offices)
		(Zip Code)

(267) 880-1595

(Issuers Telephone Number, Including
		Area Code)

Check whether the issuer (1) filed all
		reports required to be filed by Section 13 or 15(d) of the Exchange Act during
		the past 12 months (or for such shorter period that the registrant was required
		to file such reports), and (2) has been subject to such filing requirements for
		the past 90 days.xYesoNo

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

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

The number of shares outstanding of the
		issuers common stock as of April 30, 2007 was 40,910,580.

Transitional Small Business Disclosure
		Format (check one):oYesxNo






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PART I - FINANCIAL INFORMATION



ITEM 1.
			 
			 Financial StatementsBalance Sheets as of
				  March 31, 2007 (Unaudited) and December 31, 2006
			 4Statements of
				  Operations (Unaudited) for the three months ended March 31, 2007 and
				  2006
			 5Statements of Cash
				  Flows (Unaudited) for the three months ended March 31, 2007 and 2006
			 6Condensed Notes to
				  (Unaudited) Financial Statements
			 7ITEM 2.
			 
			 Managements
				  Discussion and Analysis of Financial Condition and Results of
				  Operations
			 16ITEM 3.
			 
			 Controls and
				  Procedures
			 21PART II - OTHER
				  INFORMATIONITEM 1.
			 
			 Legal
				  Proceedings
			 22ITEM 2.
			 
			 Unregistered Sales
				  of Equity Securities; and Use of Proceeds
			 22ITEM 3.
			 
			 Defaults Upon Senior
				  Securities
			 22ITEM 4.
			 
			 Submission of
				  Matters to a Vote of Security Holders
			 22ITEM 5.
			 
			 Other
				  Information
			 22ITEM 6.
			 
			 Exhibits
			 22Signature
			 24




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PART I  FINANCIAL
		INFORMATION

CAUTIONARY STATEMENT REGARDING
		FORWARD-LOOKING INFORMATION

THIS QUARTERLY REPORT ON FORM 10-QSB,
		INCLUDING EXHIBITS HERETO, 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. THESE FORWARD-LOOKING
		STATEMENTS ARE TYPICALLY IDENTIFIED BY THE WORDS ANTICIPATES,
		BELIEVES, EXPECTS, INTENDS,
		FORECASTS, PLANS, ESTIMATES,
		MAY, FUTURE, STRATEGY, OR WORDS OF SIMILAR
		MEANING. VARIOUS FACTORS COULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FROM
		THOSE EXPRESSED IN THE FORWARD-LOOKING STATEMENTS; INCLUDING THOSE DESCRIBED IN
		RISK FACTORS IN OUR ANNUAL REPORT ON FORM 10-KSB FOR THE YEAR ENDED
		DECEMBER 31, 2006. WE ASSUME NO OBLIGATIONS TO UPDATE THESE FORWARD-LOOKING
		STATEMENTS TO REFLECT NEW INFORMATION, ACTUAL RESULTS, CHANGES IN ASSUMPTIONS,
		OR CHANGES IN OTHER FACTORS, EXCEPT AS REQUIRED BY LAW.





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ITEM 1.
			 Financial Statements


QUANTRX BIOMEDICAL
		CORPORATION

BALANCE SHEETS



March 31,2007
			 
			 December 31,2006(unaudited)ASSETSCurrent Assets:Cash and cash equivalents
			 
			 $
			 2,749,225
			 
			 $
			 1,256,912Accounts receivable
			 
			 
			 33,097
			 
			 
			 Interest receivable
			 
			 
			 13,417
			 
			 
			 9,917Interest receivable  related
				  party
			 
			 
			 11,868
			 
			 
			 986Prepaid expenses
			 
			 
			 412,367
			 
			 
			 113,386Note receivable
			 
			 
			 200,000
			 
			 
			 200,000Notes receivable  related
				  party
			 
			 
			 700,000
			 
			 
			 250,000Deposits
			 
			 
			 
			 
			 
			 5,350Total Current Assets
			 
			 
			 4,119,974
			 
			 
			 1,836,551Investments
			 
			 
			 2,481,023
			 
			 
			 2,195,023Property and equipment, net
			 
			 
			 216,016
			 
			 
			 156,823Intangible assets, net
			 
			 
			 110,505
			 
			 
			 113,669Security deposits
			 
			 
			 10,667
			 
			 
			 10,667Total Assets
			 
			 $
			 6,938,185
			 
			 $
			 4,312,733LIABILITIES AND
				  STOCKHOLDERS EQUITYCurrent Liabilities:Accounts payable
			 
			 $
			 234,088
			 
			 $
			 244,863Accrued expenses
			 
			 
			 39,987
			 
			 
			 41,692Deferred revenue, current
				  portion
			 
			 
			 83,333
			 
			 
			 83,333Security deposit
			 
			 
			 2,000
			 
			 
			 Total Current Liabilities
			 
			 
			 359,408
			 
			 
			 369,888Deferred revenue, long-term
				  portion
			 
			 
			 355,736
			 
			 
			 376,569Note payable
			 
			 
			 44,000
			 
			 
			 Total Liabilities
			 
			 
			 759,144
			 
			 
			 746,457Commitments and Contingencies
			 
			 
			 
			 
			 
			 Stockholders Equity:Preferred stock - $0.01 par value;
				  25,000,000 authorized shares, no shares issued and outstanding
			 
			 
			 
			 
			 
			 Common stock - $0.01 par value;
				  75,000,000 shares authorized; 40,910,580 and 37,378,080 shares issued and
				  outstanding, respectively
			 
			 
			 409,105
			 
			 
			 373,780Additional paid-in capital
			 
			 
			 37,328,917
			 
			 
			 33,706,733Accumulated deficit
			 
			 
			 (31,558,981
			 )
			 
			 (30,514,237
			 )Total Stockholders
				  Equity
			 
			 
			 6,179,041
			 
			 
			 3,566,276Total Liabilities and
				  Stockholders Equity
			 
			 $
			 6,938,185
			 
			 $
			 4,312,733


The accompanying condensed notes are an
		integral part of these interim financial statements.





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QUANTRX BIOMEDICAL
		CORPORATION

STATEMENTS OF OPERATIONS



Three Months Ended March
				  31,2007
			 
			 2006(unaudited)
			 
			 (unaudited)Revenues
			 
			 $
			 62,369
			 
			 $
			 12,841Operating expenses:Sales and marketing
			 
			 
			 43,715
			 
			 
			 84,978General and administrative
			 
			 
			 507,426
			 
			 
			 222,827Professional fees
			 
			 
			 305,909
			 
			 
			 259,709Research and development
			 
			 
			 279,255
			 
			 
			 35,253Depreciation and amortization
			 
			 
			 13,353
			 
			 
			 2,442Total operating expenses
			 
			 
			 1,149,658
			 
			 
			 605,209Loss from operations
			 
			 
			 (1,087,289
			 )
			 
			 (592,368
			 )Other income (expense):Interest and dividend income
			 
			 
			 26,247
			 
			 
			 2,663Interest expense
			 
			 
			 (452
			 )
			 
			 (64,459
			 )Rental income
			 
			 
			 2,750
			 
			 
			 Grant income
			 
			 
			 14,000
			 
			 
			 Amortization of debt discount to
				  interest expense
			 
			 
			 
			 
			 
			 (818,264
			 )Amortization of deferred financing
				  costs to interest expense
			 
			 
			 
			 
			 
			 (92,374
			 )Total other income (expense)
			 
			 
			 42,545
			 
			 
			 (972,434
			 )Loss before income taxes
			 
			 
			 (1,044,744
			 )
			 
			 (1,564,802
			 )Provision for income taxes
			 
			 
			 
			 
			 
			 Net loss
			 
			 $
			 (1,044,744
			 )
			 $
			 (1,564,802
			 )Basic and diluted net loss per
				  common share
			 
			 $
			 (0.03
			 )
			 $
			 (0.06
			 )Weighted average shares used in per
				  share calculation:Basic and diluted
			 
			 
			 38,594,830
			 
			 
			 24,661,539


The accompanying condensed notes are an
		integral part of these interim financial statements.





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QUANTRX BIOMEDICAL
		CORPORATION

STATEMENTS OF CASH FLOWS



Three Months Ended March
				  31,2007
			 
			 2006(unaudited)
			 
			 (unaudited)CASH FLOWS FROM OPERATING
				  ACTIVITIES:Net loss
			 
			 $
			 (1,044,744
			 )
			 $
			 (1,564,802
			 )Adjustments to reconcile net loss to
				  net cash used by operating activities:Depreciation and amortization
			 
			 
			 13,353
			 
			 
			 2,442Interest expense related to
				  amortization of non-cash discount, non-cash beneficial conversion feature and
				  deferred financing costs
			 
			 
			 
			 
			 
			 910,638Non-cash stock-based compensation
				  expense
			 
			 
			 32,513
			 
			 
			 16,613Non-cash fair value of warrants
				  issued for consulting
			 
			 
			 250,000
			 
			 
			 (Increase) decrease in:Accounts receivable
			 
			 
			 (47,480
			 )
			 
			 (4,280
			 )Prepaid expenses
			 
			 
			 (298,980
			 )
			 
			 73,564Deposits
			 
			 
			 5,350
			 
			 
			 Increase (decrease) in:Accounts payable
			 
			 
			 29,828
			 
			 
			 75,663Accrued expenses
			 
			 
			 (1,705
			 )
			 
			 20,400Security deposits
			 
			 
			 2,000
			 
			 
			 Deferred revenue
			 
			 
			 (20,833
			 )
			 
			 Net cash used by operating
				  activities
			 
			 
			 (1,080,698
			 )
			 
			 (469,762
			 )CASH FLOWS FROM INVESTING
				  ACTIVITIES:Purchase of fixed assets
			 
			 
			 (109,985
			 )
			 
			 (6,282
			 )Cash paid for purchase of
				  investments
			 
			 
			 (286,000
			 )
			 
			 (1,000,000
			 )Increase in note receivable 
				  related party
			 
			 
			 (450,000
			 )
			 
			 Net cash used by investing
				  activities
			 
			 
			 (845,985
			 )
			 
			 (1,006,282
			 )CASH FLOWS FROM FINANCING
				  ACTIVITIES:Proceeds from sale of common stock
				  and warrants, net of cash issuance costs of $157,504
			 
			 
			 3,374,996
			 
			 
			 Proceeds from long-term note
				  payable
			 
			 
			 44,000
			 
			 
			 Proceeds from exercise of warrants
				  to common stock
			 
			 
			 
			 
			 
			 57,430Proceeds from issuance of
				  convertible notes
			 
			 
			 
			 
			 
			 3,155,000Cash financing costs paid for
				  issuance of convertible notes
			 
			 
			 
			 
			 
			 (127,200
			 )Net cash provided by financing
				  activities
			 
			 
			 3,418,996
			 
			 
			 3,085,230Net increase in cash and cash
				  equivalents
			 
			 
			 1,492,313
			 
			 
			 1,609,186Cash and cash equivalents, beginning
				  of period
			 
			 
			 1,256,912
			 
			 
			 990,523Cash and cash equivalents, end of
				  period
			 
			 $
			 2,749,225
			 
			 $
			 2,599,709Supplemental cash flow
				  disclosures:Interest expense paid in cash
			 
			 $
			 452
			 
			 $
			 314Income tax paid
			 
			 $
			 
			 
			 $
			 Supplemental disclosure of non-cash
				  activities:Fair value of warrants issued to
				  placement agents for debt financing costs
			 
			 $
			 
			 
			 $
			 143,049Fair value of warrants issued with
				  convertible notes
			 
			 $
			 
			 
			 $
			 1,131,663Fair value of beneficial conversion
				  derivative feature
			 
			 $
			 
			 
			 $
			 2,023,337Fair value of warrants issued with
				  common stock
			 
			 $
			 1,243,087
			 
			 $
			 Fair value of warrants issued to
				  placement agents for equity financing costs
			 
			 $
			 277,778
			 
			 $
			 Conversion of preferred stock to
				  common stock
			 
			 $
			 
			 
			 $
			 81,411Decrease in payables related to
				  purchase of fixed assets
			 
			 $
			 40,603
			 
			 $
			 Increase in payables related to debt
				  financing costs
			 
			 $
			 
			 
			 $
			 40,000


The accompanying condensed notes are an
		integral part of these interim financial statements.





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QUANTRX BIOMEDICAL
		CORPORATION

CONDENSED NOTES TO FINANCIAL
		STATEMENTS

March 31, 2007

Description of Business

QuantRx Biomedical Corporation was
		incorporated on December 5, 1986 in the State of Nevada. The Companys
		principal business office is located at 100 South Main Street, Suite 300,
		Doylestown, Pennsylvania. QuantRx also has a research and development facility
		in Portland, Oregon.

QuantRx Biomedical Corporation (hereinafter
		QuantRx or the Company) is committed to the research,
		development, acquisition and commercialization, either directly or in
		collaboration with strategic partners, of medical diagnostic technology
		platforms. The Companys strategy is to commercialize its products through
		partners or distributors, contracting the manufacturing to third party partners
		while maintaining control over the manufacturing process.

The Company has developed two proprietary
		platforms: the Miniform, a disposable technology with current applications in
		the incontinence and hemorrhoid over-the-counter (OTC) markets; and,
		RapidSense, a rapid, point-of-care diagnostic technology. The Company also
		holds significant positions in FluoroPharma, Inc., a company developing
		diagnostic molecular imaging products for use in the PET - positron emission
		tomography  market, and Genomics USA, Inc., a company which is developing
		clinically optimized microarray technology.

1.Summary of Significant Accounting Policies

Basis of Presentation

The interim financial statements are
		unaudited; however, in the opinion of management, they include all adjustments
		(consisting only of normal recurring adjustments) necessary for a fair
		statement of financial position and results of operations for the periods
		reported. The interim financial statements have been prepared pursuant to the
		rules and regulations of the SEC. Certain information and footnote disclosures
		normally included in financial statements prepared in accordance with
		accounting principles generally accepted in the United States of America have
		been condensed or omitted pursuant to such rules and regulations, although
		QuantRx believes that the disclosures included herein are adequate to make the
		information presented not misleading.

Operating results for the periods presented
		are not necessarily indicative of future results. These interim financial
		statements should be read in conjunction with the financial statements and
		notes to financial statements included in the Companys Annual Report on
		Form 10-KSB for the year ended December 31, 2006.

Certain amounts from prior periods have been
		reclassified to conform to the current period presentation. This
		reclassification has resulted in no changes to the Companys accumulated
		deficit or net losses presented.

The preparation of financial statements in
		conformity with accounting principles generally accepted in the United States
		of America requires the use of estimates and assumptions regarding





7



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certain types of assets, liabilities,
		revenues, and expenses. Such estimates primarily relate to unsettled
		transactions and events as of the date of the financial statements and fair
		valuations of share-based payments. Actual results may differ from estimated
		amounts.

Earnings per Share

The Company computes net income (loss) per
		common share in accordance with Statement of Financial Accounting Standards
		(SFAS) No. 128, Earnings per Share. Net income (loss) per
		share is based upon the weighted average number of outstanding common shares
		and the dilutive effect of common stock equivalents, such as options and
		warrants to purchase common stock, convertible preferred stock and convertible
		notes, if applicable, that are outstanding. Basic and diluted earnings per
		share were the same at the reporting dates of the accompanying financial
		statements, as including common stock equivalents in the calculation of diluted
		earnings per share would have been antidilutive.

As of March 31, 2007, the Company had
		outstanding common stock options of 1,372,500 and common stock warrants of
		7,308,484. The above options and warrants were deemed to be antidilutive for
		the three months ended March 31, 2007.

As of March 31, 2006, the Company had common
		stock options of 1,060,000, common stock warrants of 3,657,747, and convertible
		debt of $4,030,000 subject to beneficial conversion of 4,030,000 shares
		outstanding. The above options, warrants, and convertible securities were
		deemed to be antidilutive for the three months ended March 31, 2006.

Accounting for Share-Based
		Payments

Effective January 1, 2005, QuantRx
		adopted SFAS No. 123 (R), Share-Based Payments, using the
		modified prospective method of application. SFAS 123 (R) establishes the
		accounting for transactions in which an entity exchanges equity securities for
		services and requires companies to expense the estimated fair value of these
		awards over the requisite service period. QuantRx uses the Black-Scholes method
		in determining fair value. Accordingly, compensation cost has been recognized
		using the fair value method and expected term accrual requirements as
		prescribed in SFAS No. 123 (R), which resulted in stock-based compensation
		expense for the three months ended March 31, 2007 and 2006 of $32,513 and
		$16,613, respectively.

Recent Accounting
		Pronouncements

In February 2007, the Financial Accounting
		Standard Board (FASB) issued SFAS No. 159, The Fair Value Option for
		Financial Assets and Financial Liabilities  Including an Amendment to
		FASB Statement No. 115. This standard permits an entity to choose to
		measure many financial instruments and certain other items at fair value at
		specified election dates and applies to all entities with available-for-sale
		and trading securities. This statement is required in the first quarter of
		2008. QuantRx has not yet evaluated the potential impact of these new
		requirements.

In September 2006, the FASB issued SFAS No.
		157, Fair Value Measurements, to clarify how to measure fair value
		and to expand disclosures about fair value measurements. Implementation is
		required in the first quarter of 2008 with any changes to the fair values of
		assets or liabilities to be





8



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reported generally in net income or in
		accumulated comprehensive income for the period. QuantRx has not yet evaluated
		the potential impact of these new requirements.

In June 2006, the FASB issued FASB
		Interpretation No. (FIN) 48, Accounting for Uncertainty in Income
		TaxesAn Interpretation of FASB Statement No. 109, which
		prescribes a recognition threshold and measurement attribute for the financial
		statement recognition and measurement of a tax position taken or expected to be
		taken in a tax return. This interpretation is effective for fiscal years
		beginning after December 15, 2006. Adoption of this interpretation has had no
		impact on the Companys financial condition or results of operations.

In February 2006, the FASB issued SFAS No.
		155, Accounting for Certain Hybrid Financial Instruments, an Amendment of
		FASB Standards No. 133 and 140. This statement established the accounting
		for certain derivatives embedded in other instruments. This statement is
		effective for fiscal years beginning after September 15, 2006. Adoption of this
		statement has had no impact on the Companys financial condition or
		results of operations.

In May 2005, the FASB issued SFAS No. 154,
		Accounting Changes and Error Corrections, which replaces Accounting
		Principles Board Opinion No. 20, Accounting Changes, and SFAS No.
		3, Reporting Accounting Changes in Interim Financial Statements  An
		Amendment of APB Opinion No. 28. SFAS No. 154 provides guidance on
		accounting for and reporting changes in accounting principles and error
		corrections. SFAS No. 154 requires that changes in accounting principle be
		applied retrospectively to prior period financial statements and is effective
		for fiscal years beginning after December 15, 2005. Adoption of this statement
		has had no impact on the Companys financial position, results of
		operations, or cash flows.

Revenue Recognition

The Company recognizes revenue in accordance
		with the Securities and Exchange Commissions (SEC) Staff
		Accounting Bulletin Topic 13, Revenue Recognition(Topic
		13) and Emerging Issues Task Force Issue (EITF)
		No. 00-21, Revenue Arrangements with Multiple Deliverables.
		Revenue is recognized when all of the following criteria are met:
		(1) persuasive evidence of an arrangement exists; (2) delivery has
		occurred or services have been rendered; (3) the sellers price to
		the buyer is fixed and determinable; and (4) collectibility is reasonably
		assured.

Revenue from licensing agreements is
		recognized based on the performance requirements of the agreement. Revenue is
		deferred for fees received before earned. Nonrefundable upfront fees that are
		not contingent on any future performance by us are recognized as revenue when
		revenue recognition criteria under Topic 13 and EITF 00-21 are met and the
		license term commences. Nonrefundable upfront fees, where we have an ongoing
		involvement or performance obligations, are recorded as deferred revenue and
		recognized as revenue over the life of the contract, the period of the
		performance obligation or the development period, whichever is appropriate in
		light of the circumstances.

Payments related to substantive,
		performance-based milestones in an agreement are recognized as revenue upon the
		achievement of the milestones as specified in the underlying agreements when
		they represent the culmination of the earnings process. Royalty revenue from
		licensed products will be recognized when earned in accordance with the terms
		of the license agreements.





9



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2.Other Balance Sheet Information

Components of selected captions in the
		accompanying balance sheets consist of:



March 31,2007
			 
			 December 31,2006Prepaid expenses:Prepaid consulting
			 
			 $
			 18,250
			 
			 $
			 73,000Prepaid consulting  related
				  party
			 
			 
			 359,210
			 
			 
			 Prepaid insurance
			 
			 
			 21,470
			 
			 
			 30,313Prepaid legal
			 
			 
			 4,750
			 
			 
			 Prepaid rent
			 
			 
			 5,310
			 
			 
			 5,310Prepaid travel
			 
			 
			 1,361
			 
			 
			 1,361Other
			 
			 
			 2,016
			 
			 
			 3,402Prepaid expenses
			 
			 $
			 412,367
			 
			 $
			 113,386Property and
				  equipment:Computers and office furniture,
				  fixtures and equipment
			 
			 $
			 91,752
			 
			 $
			 84,129Machinery and equipment
			 
			 
			 65,519
			 
			 
			 37,104Leasehold improvements
			 
			 
			 84,572
			 
			 
			 51,228Less: accumulated
				  depreciation
			 
			 
			 (25,827
			 )
			 
			 (15,638
			 )Property and equipment,
				  net
			 
			 $
			 216,016
			 
			 $
			 156,823Accrued expenses:Professional fees
			 
			 $
			 30,000
			 
			 $
			 30,000Other
			 
			 
			 9,987
			 
			 
			 11,692Accrued expenses
			 
			 $
			 39,987
			 
			 $
			 41,692


3.Notes Receivable

FluoroPharma, Inc.

In February 2007 and December 2006, QuantRx
		advanced an aggregate of $500,000 to FluoroPharma, Inc.
		(FluoroPharma) through two $250,000, 8% promissory notes due May 16
		and March 31, 2007, respectively. QuantRx accrued interest of $7,288 on these
		notes for the three months ended March 31, 2007. The principal balances and
		unpaid accrued interest were credited to the next staged investment, which
		finalized on April 13, 2007. FluoroPharma, Inc. is a privately held molecular
		imaging company based in Boston, Massachusetts, which is engaged in the
		discovery, development and commercialization of proprietary products for the
		positron emission tomography. See Notes 4 and 12 for additional information on
		FluoroPharma.





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Genomics USA, Inc.

In January 2007, QuantRx advanced $200,000
		to Genomics USA, Inc. (GUSA) through an 8% promissory note due
		April 8, 2007. QuantRx accrued interest of $3,595 on this note for the three
		months ended March 31, 2007. GUSA, a privately held Illinois corporation, is a
		technology company focused on the development of Micro-Array Detection for DNA.
		This technology may strategically expand QuantRxs diagnostic platforms
		and QuantRx is currently exploring the possibility of further investment. See
		Note 4 for additional information on GUSA.

Rockland Technimed, Ltd.

In April 2006, QuantRx advanced $200,000 to
		Rockland Technimed, Ltd. (Rockland) through a 7% convertible
		promissory note due twelve months from the date of issuance. Rockland, a
		privately held Delaware corporation, is a development stage company focused on
		the research and development of tissue viability imaging diagnostics using
		magnetic resonance imaging (MRI) scanners. This technology may be of interest
		to QuantRx as it is developed further. QuantRx has accrued interest of $3,500
		for the three months ended March 31, 2007. The note is convertible at
		QuantRxs discretion prior to maturity into 10% of Rocklands
		outstanding capital stock on a fully diluted and as converted basis. In the
		event of default, which would occur 30 days following the maturity date,
		QuantRx has the option to receive 20% of Rocklands outstanding capital
		stock on a fully diluted and as converted basis to satisfy the note and accrued
		interest.

4.Investments

FluoroPharma, Inc.

In March 2006, QuantRx purchased 1,096,170
		shares of FluoroPharma common stock for a total purchase price of $1,566,023.
		Contemporaneously, QuantRx negotiated the purchase of an additional 300,000
		shares from private investors for $429,000. In February 2007, QuantRx purchased
		an additional 200,000 shares from private investors for $286,000. As of March
		31, 2007, QuantRx owned approximately 49.6% of the issued and outstanding
		capital stock of FluoroPharma. The investment in FluoroPharma is intended to
		strategically expand QuantRxs diagnostic platforms.

Under the initial investment agreement with
		FluoroPharma, QuantRx has the option to acquire additional shares of
		FluoroPharma through a series of staged investments. Such staged investments
		will take the form of cash at increasing valuations upon FluoroPharmas
		achievement of certain milestones with respect to the successful completion of
		Phase I and Phase II FDA trials for certain compounds being developed by
		FluoroPharma. The final staged investment to wholly acquire FluoroPharma will
		be settled in QuantRxs common stock. Any subsequent investment in
		FluoroPharma by QuantRx will be consummated pursuant to the terms and subject
		to the conditions set forth in separate definitive agreements. On April 13,
		2007, QuantRx executed a common stock purchase agreement representing the next
		staged investment in accordance with the terms of the March 2006 investment
		agreement. See Note 12 for additional details.

The investment in FluoroPharma of $2,281,023
		and $1,995,023 at March 31, 2007 and December 31, 2006, respectively, is
		accounted for in accordance with the equity method of accounting. Since
		FluoroPharmas liabilities exceeded assets on the investment dates, each
		investment has been recorded as equity method goodwill. In accordance with
		Statement of Financial





11



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Accounting Standard No. 142, Goodwill
		and Other Intangible Assets, equity method goodwill is not amortized or
		tested for impairment in accordance with this standard. QuantRx reviews the
		equity method goodwill in accordance with Accounting Principles Board Opinion
		No. 18, The Equity Method of Accounting for Investments in Common
		Stock, under which QuantRx would recognize an impairment loss when there
		is a loss in the value of the equity method goodwill which is deemed to be
		other than a temporary decline. No impairment was recognized for the three
		months ended March 31, 2007.

At March 31, 2007, FluoroPharmas
		condensed financial information was estimated as follows: total assets of
		$187,000; total liabilities of $883,000; and stockholders deficit of
		$696,000. Expenses and net losses for the three months ended March 31, 2007
		were $447,000.

In connection with the initial investment,
		QuantRx received an option to purchase an additional 260,000 shares of
		FluoroPharma common stock at an exercise price of $0.75. FluoroPharma has
		outstanding options and warrants which, if exercised together with the
		Companys option, would reduce the Companys ownership percentage to
		approximately 42.9% on a fully diluted and as converted basis as of March 31,
		2007.

Genomics USA, Inc.

In May 2006, QuantRx purchased 144,024
		shares of GUSA common stock for $200,000. As of March 31, 2007, QuantRx owned
		approximately 10% of the issued and outstanding capital stock of GUSA on a
		fully diluted and as converted basis.

QuantRx uses the cost method to account for
		this investment since QuantRx does not control nor have the ability to exercise
		significant influence over operating and financial policies. In accordance with
		the cost method, the investment is recorded at cost and impairment is
		considered in accordance with the Companys impairment policy. No
		impairment was recognized in the three months ended March 31, 2007.

5. Intangible Assets

Intangible assets as of the balance sheet
		dates consisted of the following:



March 31, 2007
			 
			 December 31, 2006Intangibles:Patents
			 
			 $
			 82,028
			 
			 $
			 82,028Patent under licensing
			 
			 
			 50,000
			 
			 
			 50,000Website development
			 
			 
			 8,500
			 
			 
			 8,500Less: accumulated
				  amortization
			 
			 
			 (30,023
			 )
			 
			 (26,859
			 )Intangibles, net
			 
			 $
			 110,505
			 
			 $
			 113,669


The Companys intangible assets are
		carried at the legal cost to obtain them. Intangible assets are amortized using
		the straight line method over the estimated useful life. Useful lives are as
		follows: patents, 17 years; patents under licensing, 10 years; website
		development costs, three years. Amortization expense totaled $3,164 and $1,206
		for the three months ended March 31, 2007 and





12



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2006, respectively. Impairment will be
		considered in accordance with the Companys impairment policy. No
		impairment was recognized as of March 31, 2007.

6. Deferred Revenue

On July 7, 2006 (the effective
		date), QuantRx and Synova Healthcare, Inc. (Synova) entered
		into a distribution agreement pursuant to which Synova will act as the
		exclusive distributor of specified hemorrhoid products of QuantRx in the United
		States. The initial term of the agreement commenced on the effective date and,
		unless sooner terminated as provided in the agreement, shall continue in effect
		for a period of five years following the month in which Synova makes first
		shipment of products to its initial customers. Management has estimated the
		effective term of the agreement to be six years from the effective date. The
		territory covered by the distribution agreement will be expanded to include
		Canada and Mexico if Synova meets specified minimum sales milestones during the
		first year of the distribution agreements term. Exclusivity is
		conditioned on Synova achieving specified minimum annual sales milestones.

QuantRx received an up-front, non-refundable
		payment of $500,000 upon execution of the distribution agreement in 2006, which
		has been recorded as deferred revenue and is being amortized into revenue over
		the expected term of the agreement, which is six years.

QuantRx recognized revenue of $20,833 in the
		quarter ended March 31, 2007 in connection with the distribution agreement. As
		of March 31, 2007 deferred revenue related to the distribution agreement was
		$439,069, of which $83,333 is considered current.

7. Portland Development
		Commission

In February 2007, QuantRx received a $44,000
		loan from the Portland Development Commission. The loan matures in 20 years and
		is interest free through March 1, 2010 and no payments are due until April 1,
		2010. The terms of the promissory note stipulate that the interest rate will
		accrue beginning in March 1, 2010 at an annual rate between 1% and 8.5% based
		upon the level of compliance with certain employment milestones beginning in
		2008.

Additionally, QuantRx received a $14,000
		grant for qualified expenditures related to its research facility. QuantRx
		satisfied the grant terms and recorded the grant as other income in the first
		quarter of 2007.

8. Preferred Stock and
		Warrants

The Company has authorized 25,000,000 shares
		of preferred stock, of which 9,750,000 are designated Series A convertible
		preferred stock, $0.01 par value. The remaining 15,250,000 authorized preferred
		shares have not yet been designated by the Company. The Company had no issued
		and outstanding preferred stock at March 31, 2007 and 2006,
		respectively.

Effective February 13, 2006, holders of all
		outstanding shares of the Series A convertible preferred stock of QuantRx
		exercised their rights under the terms of the Series A preferred stock to
		convert all of their outstanding shares of Series A preferred stock into shares
		of QuantRxs common stock. Each share of Series A preferred stock was
		converted into 1.5 shares of QuantRxs common stock, resulting in the
		issuance by QuantRx of 12,211,721 common shares. As of the date hereof,





13



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there are no shares of Series A preferred
		stock outstanding. Additionally, warrants to purchase 180,000 shares of Series
		A preferred stock were submitted and exchanged for warrants to purchase 180,000
		shares of common stock, with the same terms as the original warrants.

9. Common Stock, Options and
		Warrants

On March 1, 2007, QuantRx completed a
		private placement of 3,532,500 shares of common stock and warrants with a
		five-year term valued at $1,243,087 to purchase an aggregate of 1,059,750
		shares of common stock at $1.50 per share to accredited investors for gross
		proceeds of $3,532,500 in cash. The Company issued warrants with a seven-year
		term to purchase 194,250 shares of common stock at $1.00 per share valued at
		$277,778 and paid cash commissions of $155,400 in connection with the private
		placement to Legend Merchant Inc., and an additional $2,104 for related legal
		services.

In the first quarter of 2007, QuantRx issued
		200,000 common stock warrants with a five-year term to purchase 200,000 shares
		of common stock at an exercise price of $1.50. The warrants were issued
		pursuant to a financial advisory services agreement, and the fair value of
		$250,000 for these warrants will be expensed over the expected service term of
		four months.

In the first quarter of 2006, 85,800 common
		stock warrants were exercised and exchanged for 85,800 shares of common stock,
		$0.01 par value, resulting in proceeds to the Company of $57,430. The exercise
		prices ranged from $0.20 to $0.85.

In the first quarter of 2006, 723,250 common
		stock warrants with an exercise price of $1.50 and a term of five years were
		issued to investors in conjunction with the issuance of convertible promissory
		notes.

In the first quarter of 2006, 90,560 common
		stock warrants with an exercise price of $1.50 and a term of five years were
		issued to placement agents for services related to the debt financing closed
		February 15, 2006.

Incentive and Non-Qualified Stock Option
		Plan

Pursuant to SFAS 123(R), the fair value of
		options granted under the Companys Incentive and Non-Qualified Stock
		Option Plan is recorded as compensation expense over the vesting period, or,
		for performance based awards, the expected service term. Total compensation
		cost related to the Incentive and Non-Qualified Stock Option Plan was $32,513
		and $16,613 for the three months ended March 31, 2007 and 2006, respectively.
		No options were granted in the three months ended March 31, 2007 or 2006.

10. Related Party Transactions

On March 9, 2007 the Company issued 200,000
		common stock warrants with a five year term to purchase 200,000 shares of
		common stock at an exercise price of $1.50. The warrants were issued as payment
		pursuant to a financial advisory services agreement with Burnham Hill Partners,
		of which a beneficial owner of more than 5% of QuantRx common stock is a
		managing member. The fair value of these warrants is $250,000 and will be
		expensed over the expected service term of





14



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four months. Additionally, cash compensation
		of $200,000 was paid pursuant to the terms of the agreement and will also be
		expensed over the expected four month service term.

A member of the Companys board of
		directors serves as a consultant to the Company on various business, strategic,
		and technical issues. Fees paid and expensed for these services by the Company
		during the three months ended March 31, 2007 and 2006 were $12,000 and $12,000,
		respectively.

The Company had a temporary arrangement in
		which it leased office space from Trident Group, LLC, of which the current
		chief executive officer of the Company was a principal. In addition to a
		monthly rental payment for office space, the Company reimbursed Trident for
		related office expenses. The Company entered into the agreement in the second
		quarter of 2005 and terminated it in the third quarter of 2006. The Company
		expensed $3,723 under this arrangement for the three months ended March 31,
		2006.

11. Commitments and
		Contingencies

Operating Leases

QuantRx leases office space and research and
		development lab space under operating leases that expire at various times
		through 2011. Some of these leases contain cancellation clauses, subject to a
		termination fee, and include allocations for common expenses subject to future
		adjustment. Rent expense related to operating leases was approximately $29,345
		and $12,020 for the three months ended March 31, 2007 and 2006, respectively.
		In connection with some of these facility leases, the Company has made security
		deposits totaling $10,310, which are included in long-term assets in the
		balance sheet. Future minimum lease obligations, inclusive of potential
		termination fees, for operating leases as of March 31, 2007 are estimated as
		follows:



Remainder of 2007
			 
			 $
			 78,1192008
			 
			 
			 111,9882009
			 
			 
			 90,9882010
			 
			 
			 46,3652011
			 
			 
			 35,550Total minimum payments
			 
			 $
			 363,010


In February 2007, the Company began
		sub-leasing research and development lab space under the noncancellable
		operating leases. The sublease terminates September 30, 2007; however, will
		automatically renew for one-year terms, not to exceed the term of
		QuantRxs operating lease. The sublease can be terminated upon ninety days
		notice by either party, and a $2,000 security deposit is being held by QuantRx
		pursuant to the terms of the lease. Sub-lease revenue for the quarter ended
		March 31, 2007 was $2,750.

Executive Employment Contracts

The Company has entered into an employment
		contract with a key Company executive that provides for the continuation of
		salary to the executive if terminated for reasons other than cause, as





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defined in those agreements. At March 31,
		2007, the future employment contract commitment for such key executive based on
		this termination clause was approximately $240,000.

Minimum Royalty Commitments

QuantRx has a minimum royalty payment of
		$50,000 due in the third quarter of 2007 pursuant to a licensing
		agreement.

12. Subsequent Events

Staged Investment in FluoroPharma,
		Inc.

On April 13, 2007, QuantRx and FluoroPharma
		closed the transactions contemplated by a stage 2 investment
		agreement. Under the investment agreement QuantRx purchased 627,058 shares of
		common stock of FluoroPharma for $1,250,000, consisting of (i) cash payments
		aggregating $741,178 ($491,178 of which must be paid by QuantRx within 120 days
		after the closing) and (ii) cancellation in full of two promissory notes issued
		by FluoroPharma in favor of QuantRx in the aggregate principal amount of
		$500,000 and with accrued and unpaid interest of $8,822, for a total of
		$508,822.

The stage 2 investment agreement
		was executed in accordance with the terms of the original investment agreement
		finalized in March 2006. Under the original investment agreement, FluoroPharma
		issued common stock and an option to QuantRx in exchange for a capital
		contribution, and QuantRx was given the right to acquire, at its option and in
		its sole discretion, a majority interest in FluoroPharma through a series of
		staged investments.

Immediately after the closing, QuantRx owned
		approximately 57.7% of the outstanding shares of common stock of FluoroPharma
		(50.1% on a fully diluted basis).

ITEM 2.
			 Managements Discussion and
				  Analysis of Financial Condition and Results of Operations


The following discussion of our financial
		condition should be read in conjunction with the financial statements and notes
		to financial statements included elsewhere in this filing. The following
		discussion (as well as statements in Item 1 above and elsewhere) contains
		forward-looking statements within the meaning of the Private Securities
		Litigation Act of 1995 that involve risks and uncertainties. Some or all of the
		results anticipated by these forward-looking statements may not occur.
		Forward-looking statements involve known and unknown risks and uncertainties
		including, but not limited to, trends in the biotechnology, healthcare, and
		pharmaceutical sectors of the economy; competitive pressures and technological
		developments from domestic and foreign genetic research and development
		organizations which may affect the nature and potential viability of our
		business strategy; and private or public sector demand for products and
		services similar to what we plan to commercialize. We disclaim any intention or
		obligation to publicly announce the results of any revisions to any of the
		forward-looking statements contained herein to reflect future events or
		developments.





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Unless otherwise indicated or the context
		otherwise requires, all references in this report to we,
		our, ours, us, the Company or
		similar terms refer to QuantRx Biomedical Corporation, a Nevada
		corporation.

Overview

QuantRx Biomedical Corporation was
		incorporated on December 5, 1986 in the State of Nevada. The Companys
		principal business office is located at 100 South Main Street, Suite 300,
		Doylestown, Pennsylvania. QuantRx also has a research and development facility
		in Portland, Oregon.

QuantRx Biomedical Corporation is committed
		to the research, development, acquisition and commercialization, either
		directly or in collaboration with strategic partners, of medical diagnostic
		technology platforms. The Companys strategy is to commercialize its
		products through partners or distributors, contracting the manufacturing to
		third party partners while maintaining control over the manufacturing
		process.

The Company has developed two proprietary
		platforms: the Miniform, a disposable technology with current applications in
		the incontinence and hemorrhoid over-the-counter (OTC) markets and with
		potential future applications in specimen collection and drug delivery; and
		RapidSense, a rapid, point-of-care diagnostic technology. The Company also
		holds significant positions in FluoroPharma, Inc., a company developing
		diagnostic molecular imaging products for use in the PET - positron emission
		tomography  market, and Genomics USA, Inc., a company which is developing
		clinically optimized microarray technology.

In February 2007, QuantRx increased its
		position in FluoroPharma with a purchase of an additional 200,000 shares of
		common stock from private investors for $286,000. As of March 31, 2007, QuantRx
		owned approximately 49.6% of the issued and outstanding capital stock of
		FluoroPharma and approximately 42.9% on a fully diluted and as converted basis.
		QuantRxs continued investment in FluoroPharma is intended to
		strategically expand QuantRxs diagnostic platforms.

On April 13, 2007, QuantRx executed a common
		stock purchase agreement representing the next staged investment in accordance
		with the terms of the original March 2006 investment agreement. Under the
		stage 2 agreement QuantRx purchased 627,058 shares of common stock
		of FluoroPharma for $1,250,000, consisting of (i) cash payments aggregating
		$741,178 ($491,178 of which must be paid by QuantRx within 120 days after the
		closing) and (ii) cancellation in full of two promissory notes issued by
		FluoroPharma in favor of QuantRx in the aggregate principal amount of $500,000
		and with accrued and unpaid interest of $8,822, for a total of $508,822. The
		stage 2 investment agreement was executed in accordance with the
		terms of the original investment agreement finalized in March 2006. Under the
		original investment agreement, FluoroPharma issued common stock and an option
		to QuantRx in exchange for a capital contribution, and QuantRx was given the
		right to acquire, at its option and in its sole discretion, a majority interest
		in FluoroPharma through a series of staged investments. Immediately after the
		closing, QuantRx owned approximately 57.7% of the outstanding shares of common
		stock of FluoroPharma (50.1% on a fully diluted basis).





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Results of Operations

Net operating revenues for the three months
		ended March 31, 2007 and 2006 were $62,369 and $12,841, respectively. The
		increase in revenues of $49,528 is due to the recognition of $28,695 related to
		a short-term research and development agreement executed in February 2007 and
		$20,833 accreted from deferred revenue.

Other revenues in the quarter ended March
		31, 2007 included a $14,000 governmental grant for qualified expenditures at
		our research facility and rental income of $2,750 for the subleasing of
		research and development lab space at our research facility.

Sales and marketing expense for the three
		months ended March 31, 2007 and 2006 was $43,715 and $84,978, respectively. The
		decrease of $41,263 primarily reflects a decrease in personnel expense and
		decreased business development costs.

General and administrative expense,
		including professional fees, for the three months ended March 31, 2007 and 2006
		was $813,335 and $482,536, respectively. The increase of $330,799 primarily
		reflects an increase of $219,845 for additional Company personnel and related
		travel expenses. Additionally, professional fees increased $46,201, primarily
		related to increased public relations consulting service fees of $75,623 and
		financial advisory consulting service fees of $42,647, offset by decreased
		legal fees of $61,569.

Research and development expense for the
		three months ended March 31, 2007 and 2006, was $279,255 and $35,253. The
		increase of $244,002 primarily reflects an increase of $143,771 in technical
		consulting expenses and ongoing contracted product development, as well as an
		increase of $38,786 in supplies used for research and development.

The Companys net loss for the three
		months ended March 31, 2007 and 2006 was $1,044,744 and $1,564,802,
		respectively. The decreased net loss is primarily due to a reduction in
		interest expense of $974,645 related to convertible promissory notes which were
		converted to common stock in December 2006. This decrease was partially offset
		by an increase in operating expenses of $544,449, which reflects additional
		costs related to the development and enhancement of our technology, staffing
		requirements, and expenses related to investor and public relations and
		financial advisory services.

Liquidity and Capital
		Resources

As of March 31, 2007, QuantRx had cash and
		cash equivalents of $2,749,225, as compared to cash and cash equivalents of
		$1,256,912 as of December 31, 2006. The net increase in cash of $1,492,313 for
		the three months ended March 31, 2007, is primarily attributed to a private
		placement of 3,532,500 shares of common stock and warrants valued at $1,243,087
		to purchase an aggregate of 1,059,750 shares of common stock at $1.50 per share
		to accredited investors for gross proceeds of $3,532,500 in cash. This increase
		is partially offset by investments in common stock of FluoroPharma, Inc. of
		$286,000 and the advance of $450,000 through the issuance of a $200,000 8%
		convertible promissory note to Genomics USA, Inc. and a $250,000 8% convertible
		promissory note to FluoroPharma, Inc., as well as net operating cash used of
		$1,080,698. QuantRx has used its financing proceeds as well as its revenues to
		fund current operating expenses and investments intended to strategically
		expand our platforms and technologies.





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In the future QuantRx expects to expand
		operations with the use of additional financing and increased revenues from
		operations.

Off-Balance Sheet Arrangements

We have not entered into any transactions
		with unconsolidated entities in which we have financial guarantees,
		subordinated retained interests, derivative instruments or other contingent
		arrangements that expose us to material continuing risks, contingent
		liabilities or any other obligations under a variable interest in an
		unconsolidated entity that provides us with financing, liquidity, market risk
		or credit risk support.

Critical Accounting Policies

Revenue Recognition

The Company recognizes revenue in accordance
		with the Securities and Exchange Commissions (SEC) Staff
		Accounting Bulletin Topic 13, Revenue Recognition(Topic
		13) and Emerging Issues Task Force Issue (EITF)
		No. 00-21, Revenue Arrangements with Multiple Deliverables.
		Revenue is recognized when all of the following criteria are met:
		(1) persuasive evidence of an arrangement exists; (2) delivery has
		occurred or services have been rendered; (3) the sellers price to
		the buyer is fixed and determinable; and (4) collectibility is reasonably
		assured.

Revenue from licensing agreements is
		recognized based on the performance requirements of the agreement. Revenue is
		deferred for fees received before earned. Nonrefundable upfront fees that are
		not contingent on any future performance by us are recognized as revenue when
		revenue recognition criteria under Topic 13 and EITF 00-21 are met and the
		license term commences. Nonrefundable upfront fees, where we have an ongoing
		involvement or performance obligations, are recorded as deferred revenue and
		recognized as revenue over the life of the contract, the period of the
		performance obligation or the development period, whichever is appropriate in
		light of the circumstances.

Payments related to substantive,
		performance-based milestones in an agreement are recognized as revenue upon the
		achievement of the milestones as specified in the underlying agreements when
		they represent the culmination of the earnings process. Royalty revenue from
		licensed products will be recognized when earned in accordance with the terms
		of the license agreements.

Use of Estimates

The preparation of financial statements and
		related disclosures in conformity with accounting principles generally accepted
		in the United States requires management to make estimates and assumptions that
		affect the reported amounts of assets and liabilities, revenues and expenses
		and related disclosures of contingent assets and liabilities in the financial
		statements and accompanying notes. The accounting policies discussed below are
		considered by management to be the most important to the Companys
		financial condition and results of operations, and require management to make
		its most difficult and subjective judgments due to the inherent uncertainty
		associated with these matters. All significant estimates and assumptions are
		developed based on the best information available to us at the time made and
		are regularly reviewed and adjusted when necessary. We believe





19



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that our estimates and assumptions are
		reasonable under the circumstances; however, actual results may vary from these
		estimates and assumptions.

Impairment of Assets

We assess the impairment of long-lived
		assets whenever events or changes in circumstances indicate that their carrying
		value may not be recoverable. The determination of related estimated useful
		lives and whether or not these assets are impaired involves significant
		judgments, related primarily to the future profitability and/or future value of
		the assets. Changes in our strategic plan and/or market conditions could
		significantly impact these judgments and could require adjustments to recorded
		asset balances. We hold minority interests in companies having operations or
		technologies in areas which are within or adjacent to our strategic focus when
		acquired, all of which are privately held and whose values are difficult to
		determine. We record an investment impairment charge if we believe an
		investment has experienced a decline in value that is other than temporary.
		Future changes in our strategic direction, adverse changes in market conditions
		or poor operating results of underlying investments could result in losses or
		an inability to recover the carrying value of the investments that may not be
		reflected in an investments current carrying value, thereby possibly
		requiring an impairment charge in the future.

We perform annual impairment tests of our
		equity method goodwill and other intangible assets in accordance with Statement
		of Financial Accounting Standards (SFAS) No. 142, Goodwill and Other
		Intangible Assets. Under SFAS No. 142, goodwill is not amortized but
		is subject to impairment tests based upon a comparison of the fair value of the
		entity and the carrying value of the entitys net assets. SFAS
		No. 142 requires a review of goodwill and other intangible assets for
		impairment at least annually or when circumstances exist that would indicate an
		impairment of such goodwill or other intangible assets. We determine whether
		the equity method goodwill and other intangible assets are impaired by
		comparing the respective fair values of the equity method goodwill and/or other
		intangible assets to their respective carrying values.

In determining fair value of assets, QuantRx
		bases estimates on historical experience and on various other assumptions that
		are believed to be reasonable under the circumstances, the results of which
		form the basis for making judgments about carrying values of assets that are
		not readily apparent from other sources. Actual fair value may differ from
		management estimates resulting in potential impairments causing material
		changes to certain assets and results of operations.

Share-based Payments

We grant options to purchase our common
		stock to our employees and directors under our stock option plan subject to the
		provisions of SFAS No. 123 (R), Share-Based Payments. Effective
		January 1, 2005, we use the fair value method to apply the provisions of
		SFAS No. 123 (R) with a modified prospective application which provides
		for certain changes to the method for valuing share-based compensation. The
		valuation provisions of SFAS No. 123 (R) apply to new awards and to awards
		that are outstanding on the effective date and subsequently modified or
		cancelled. Under the modified prospective application, prior periods are not
		revised for comparative purposes.

Upon adoption of SFAS No. 123 (R), we
		began estimating the value of stock option awards on the date of grant using a
		Black-Scholes pricing model (Black-Scholes model). The determination of the
		fair value of share-based payment awards on the date of grant using the
		Black-Scholes model





20



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is affected by our stock price as well as
		assumptions regarding a number of complex and subjective variables. These
		variables include, but are not limited to, our expected stock price volatility
		over the term of the awards, actual and projected employee stock option
		exercise behaviors, and risk-free interest rate. If factors change and we
		employ different assumptions in the application of SFAS No. 123 (R) in
		future periods, the compensation expense that we record under SFAS No. 123
		(R) may differ significantly from what we have recorded in the current period.

Estimates of share-based compensation
		expenses are significant to our financial statements, but these expenses are
		based on option valuation models and will never result in the payment of cash
		by us.

ITEM
				  3.
			 Controls and
				  Procedures


(a) Evaluation of Disclosure Controls and
		Procedures

The Company maintains disclosure controls
		and procedures that are designed to ensure that information required to be
		disclosed in our SEC reports is recorded, processed, summarized and reported
		within the time periods specified in the SECs rules and forms, and that
		such information is communicated to our management including our Chief
		Executive Officer and Chief Financial Officer as appropriate. With the
		supervision and with the participation of our management, including the Chief
		Executive Officer and Chief Financial Officer, we have evaluated the
		effectiveness of our disclosure controls and procedures (as defined under
		Exchange Act Rules 13a-15(e) and 15(d)-15(e)), as of the end of the period
		covered by this report. Based on that evaluation, our Chief Executive Officer
		and Chief Financial Officer have concluded that these disclosure controls and
		procedures were effective as of March 31, 2007.

(b) Changes in Internal Control over
		Financial Reporting

During the period covered by this Quarterly
		Report on Form 10-QSB, there were no changes in our internal control over
		financial reporting that have materially affected, or are reasonably likely to
		affect, our internal control over financial reporting.

Given the inherent limitations in all
		control systems, no evaluation of controls can provide absolute assurance that
		misstatements due to error or fraud will not occur or that all control issues
		and instances of fraud, if any, will have been detected. These inherent
		limitations include the realities that judgments in decision-making can be
		faulty, and that breakdowns can occur because of simple error or mistake.
		Further, the design of a control system must reflect the fact that there are
		resource constraints, and that the benefits of a control system must be
		considered relative to its cost. The design of any system of controls is also
		based in part on certain assumptions regarding the likelihood of future events,
		and there can be no assurance that any design will succeed in achieving its
		stated goals under all potential future conditions.





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PART II - OTHER INFORMATION

ITEM
				  1.
			 Legal Proceedings.


As of the date hereof, the Company has no
		pending or threatened litigation.

ITEM
				  2.
			 Unregistered Sales of Equity
				  Securities, and Use of Proceeds


On March 9, 2007 the Company issued 200,000
		common stock warrants with a five year term to purchase 200,000 shares of
		common stock at an exercise price of $1.50 under the exemption from
		registration under the Securities Act of 1933, as amended, in reliance on
		Section 4(2) of the Securities Act or regulation D promulgated under the
		Securities Act. The warrants were issued as payment pursuant to a financial
		advisory services agreement with Burnham Hill Partners, of which Matthew Balk,
		a beneficial owner of more than 5% of outstanding shares of common stock, is a
		managing member. The fair value of these warrants is $250,000 and will be
		expensed over the expected four month service term of the agreement.
		Additionally, cash compensation of $200,000 was paid pursuant to the terms of
		the agreement and will also be expensed over the expected four month service
		term of the agreement.

There were no additional sales of
		unregistered securities other than as reported in prior reports on Form
		8-K.

ITEM
				  3.
			 Defaults on Senior
				  Securities


None.

ITEM
				  4.
			 Submission of Matters to a Vote
				  of Security Holders


None.

ITEM 5.
			 Other Information


None.

ITEM 6.
			 Exhibits


Exhibit Index





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Exhibit
			 
			 Description31.1
			 
			 Certification of Chief Executive
				  Officer required under Rule 13a-14(a) or Rule 15d-14(a) of the Securities and
				  Exchange Act of 1934, as amended.31.2
			 
			 Certification of Chief Financial
				  Officer required under Rule 13a-14(a) or Rule 15d-14(a) of the Securities and
				  Exchange Act of 1934, as amended.32.1*
			 
			 Certification of Chief Executive
				  Officer required under Rule 13a-14(a) or Rule 15d-14(a) of the Securities and
				  Exchange Act of 1934, as amended, and 18 U.S.C. Section 1350.32.2*
			 
			 Certification of Chief Financial
				  Officer required under Rule 13a-14(a) or Rule 15d-14(a) of the Securities and
				  Exchange Act of 1934, as amended, and 18 U.S.C. Section 1350.


*
			 The certifications attached as
				  Exhibits 32.1 and 32.2 accompany this Quarterly Report on Form 10-QSB pursuant
				  to Section 906 of the Sarbanes-Oxley Act of 2002 and shall not be deemed
				  filed by QuantRx Biomedical Corporation for purposes of Section 18
				  of the Exchange Act.






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SIGNATURES

Pursuant to the requirements of
		Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant
		has duly caused this report to be signed on its behalf by the undersigned,
		thereunto duly authorized.



QuantRx Biomedical
				  CorporationDate:   May 15,
				  2007
			 
			 By:
			 /s/ Walter WitoshkinWalter WitoshkinChairman & CEODate:   May 15,
				  2007
			 
			 By:
			 /s/ Sasha AfanassievSasha AfanassievCFO, Treasurer & VP of
				  Finance






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