UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-KSB

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


                    For the fiscal year ended March 31, 2004

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

               For the transition period from _______ to ________


                        Commission File Number: 000-15654

                            CYGENE LABORATORIES, INC.
                            -------------------------
        (Exact name of small business issuer as specified in its charter)

                   Delaware                               22-2789408
                   --------                               ----------
       (State or other jurisdiction of         (IRS Employer Identification No.)
        incorporation or organization)

                  7786 Wiles Road, Coral Springs, Florida 33067
                  ---------------------------------------------
               (Address of principal executive offices) (Zip code)

                                 (954) 741-7077
                                 --------------
                           (Issuer's telephone number)

         Securities registered under Section 12(b) of the Exchange Act:

                                      None
                                      ----
      Securities Registered Pursuant to Section 12(g) of the Exchange Act:

                         Common Stock, $0.001 par value
                         ------------------------------
                                (Title of class)

Check  whether the Issuer (1) filed all reports  required to be filed by Section
13 or 15(d) of the  Exchange  Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports),  and (2) has been
subject to such filing requirements for the past 90 days. [ ] Yes [X] No

Check if there is no disclosure of delinquent  filers in response to Item 405 of
Regulation  S-B is not  contained  in  this  form,  and no  disclosure  will  be
contained, to the best of registrant's knowledge, in


<PAGE>


definitive proxy or information statements incorporated by reference in Part III
of this Form 10-KSB or any amendment to this Form 10-KSB. [ ]

State issuer's revenues for its most recent fiscal year.   $0

State the aggregate market value of the voting and non-voting common equity held
by non-affiliates  computed by reference to the price at which the common equity
was sold,  or the average bid and asked  price of such  common  equity,  as of a
specified  date within the past 60 days.  (See  definition  of affiliate in Rule
12b-2 of the Exchange Act.). $27,191,269 as of September 7, 2004.

State the number of shares outstanding of each of the issuer's classes of common
equity,  as of the latest  practicable  date.  42,185,079 shares of common stock
were outstanding as of September 7, 2004.


Transitional Small Business Disclosure Form (Check one):  Yes [ ]; No [X]
<PAGE>


ITEM 1. DESCRIPTION OF BUSINESS

         We  are  filing  this  Report  without   including   audited  financial
statements  for the year ended March 31, 2004 at this time and expect to be able
to  file  audited  financial  statements  as soon  as our  independent  auditors
complete  their audit.  In addition,  the Company is not  including  the audited
financial  statements  for the  year  ended  March  31,  2003,  which  financial
statements  are required to be amended in two respects.  First,  the Company did
not  include a  non-cash  operating  expense  resulting  from  gifts made by our
principal  stockholders (and CyGene,  Inc.'s principal  stockholders) of CyGene,
Inc.  common  stock to certain  persons who have  provided  loans or services or
assistance  to CyGene,  Inc. In  addition,  our  financial  statements  were not
prepared on a development stage business; accordingly, our fiscal 2003 financial
statements  need to be restated and  presented on a development  stage  business
basis.  Because our prior independent  auditors have not yet determined that our
present accounting treatment is appropriate,  and the necessary changes have not
been made at this time. Once our prior independent auditors determine whether or
not they will issue a new  opinion  for the  financial  statements  for the year
ended  March  31,  2003,  which  will  be  on a  development  stage  basis,  the
appropriate  amendment  to this Report and  restatement  to our prior  financial
statements  will be made. In our opinion,  none of these changes are material as
that term has been  defined by the United  States  Supreme  Court in  construing
provisions of the Securities Exchange Act of 1934.

         In addition,  gifts made prior to fiscal 2003 will result in additional
charges.  Thus, a significant sum will be added to the accumulated deficit which
will be included in our balance sheet.




                                       1
<PAGE>

OUR BUSINESS AND HISTORY

         We are a biotechnology company based in Coral Springs, Florida. We were
incorporated  in  Delaware  on December  22,  1986  originally  to engage in the
development of respiratory therapy products. On September 30, 2003, as described
below, we acquired CyGene, Inc. CyGene, Inc. was incorporated in 1995 to develop
and  commercialize  a next  generation DNA diagnostic  technology  called TPA or
Target  Protection  Assay.  The  assets of CyGene,  Inc.  consist  primarily  of
numerous U.S. and foreign  patents.  We had no revenue for our fiscal year ended
March 31, 2004,  and had a  significant  net loss. As of March 31, 2004 we had a
significant  accumulated deficit. We have not had any revenue during our current
fiscal year.

         On  September  30,  2003,  New  Transpirator,  Inc.,  our  wholly-owned
subsidiary,  merged  with  CyGene,  Inc.  Pursuant  to the  merger,  the  common
stockholders of CyGene, Inc. who were accredited investors,  plus the largest 35
unaccredited  investors received approximately 85% of our issued and outstanding
common  stock and the  remaining  stockholders  of CyGene,  Inc.  received  cash
totaling  approximately  $10,008 or $0.07143 per share of CyGene,  Inc.'s common
stock in exchange for 100% of the capital stock of CyGene, Inc. Our stockholders
immediately  prior to the merger  retained  approximately  15% of our issued and
outstanding common stock.

         At the time of the transaction,  we changed our name from  Transpirator
Technologies, Inc. to CyGene Laboratories, Inc. Immediately prior to the merger,
our primary business was related to respiratory  therapy.  Pursuant to the terms
of the  merger  agreement,  the  assets and  future  royalties  of  Transpirator
Technologies,  Inc.,  relating to its  business  were  transferred  to a limited
liability  company  established  prior to September  30, 2003 for the benefit of
Transpirator  Technologies,  Inc.'s stockholders as determined immediately prior
to the  merger.  Thus,  our  stockholders  have no  interest  in such  assets or
royalties of our prior business.

         Our company, through its operating subsidiary,  CyGene, Inc., has built
a  discovery,  development  and future  commercialization  platform  for DNA/RNA
technologies  which we believe will allow it to create  significant value within
our  franchise.  We have continued the  development  of proprietary  DNA and RNA
testing systems for screening, monitoring and diagnosis of human, veterinary and
plant disease.  Our efforts to develop and improve our diagnostics have resulted
in the discovery of two  independent  platform drug  technologies  that have the
potential to significantly increase the value of our company.

         We currently hold five patents  including a recent United States Patent
and Trademark office approval for our next generation  gene-capture  technology.
This technology has commercial  potential not only in the diagnostics field, but
also  for its use as a  highly  stable  and  efficient  gene  therapy  drug  for
Antisense and RNA Interference (RNAi).

         We have been  focused  in the short  term  with  developing  commercial
opportunities   in   the   diagnostic   testing   and   individualized   genetic
characterization.   We  have  developed  a  patented  business  model  to  offer
inexpensive yet accurate genetic tests to the public on an anonymous basis which
are  linked to a  web-based  "American  Registry  of  DNA"(TM).  This will offer
consumers   access  to  a  variety  of  DNA-based  tests  and  analysis.   While
individualized  genetic  characterization  represents  a  relatively  short term
opportunity,  which we plan to pursue with a marketing and sales partner, we are
also continuing to develop related diagnostic and therapeutic  applications.  We
have developed a fully integrated,  automated approach to in-vitro  diagnostics.
This  approach  allows for the search of any form of target in any sample  size,
whether  DNA,  RNA,  cellular,  chemical  or  soluble  protein.  The  commercial
significance of our



                                       2
<PAGE>

approach is considerable with application at blood banks,  clinical laboratories
and large medical centers.  These  applications can give blood banks the ability
to mass screen for specific pathogens such as the West Nile Virus, Hepatitis and
HIV.

         We  are  focusing  our  initial   development  efforts  in  therapeutic
application on a product  intended for the  containment  of possible  bacterial,
viral and chemical terrorism attacks.  Our Strategic Target Elimination  ("STE")
system is an antibody-based technology,  coupled with a unique delivery platform
that is designed to rapidly and safely clear microbiological, viral and chemical
agents  from  blood.   In  addition,   STE  has  the   potential  to  act  as  a
pseudo-vaccine,  conferring  protection to an individual for approximately 30 to
60 days.

BUSINESS STRATEGY

         CyGene, Inc. is positioned to be a leading next generation gene therapy
and diagnostics  company.  We believe our patented  technologies have promise in
the discovery,  development and utilization of existing and novel diagnostics as
well as genetic profiling using synthetic DNA, signal  amplification  strategies
and automation.  We are actively developing  therapeutics based on synthetic DNA
and novel  approaches that utilize and enhance the natural immune system for the
rapid clearance of pathogens from blood.

         Our activities are primarily  based on four  technologies  all of which
are carried out through our subsidiary, CyGene, Inc.:

         o        Our  STE   technology   has  the   potential  of  becoming  an
                  inexpensive,  rapid and safe treatment and immunization method
                  for many hard-to-treat  diseases, and we believe it has unique
                  characteristics  for post-chemical and  post-biological-attack
                  control and containment phases.

         STE relies on the highly  evolved  natural immune system the human body
has developed  throughout its evolution to effectively  fight off disease.  This
system is comprised of two well-understood components, the humeral immune system
and the cellular  immune  system,  and utilizes  both of these systems to effect
blood-borne  pathologic  target  inactivation  and  clearance.  We believe  that
through utilizing these systems,  a passive  immunization can be developed which
could protect an individual  for up to a maximum of 90 days.  The humeral immune
system is responsible for producing  antibodies to any foreign organism entering
the body.

         Once an intruder is  perceived,  be it either of chemical or biological
origin,  the immune system will produce  antibodies  to that entity,  which will
capture and bind the pathologic  target to a cell for clearance out of the body.
This process generally suffices to maintain health and ward off common diseases.

         In the event of a chemical or biological attack,  where relatively high
concentrations  of deadly and toxic  agents  are  involved,  or as with  certain
diseases,  the immune  system is either very slow to, or does not,  respond.  In
such cases,  our STE process  has the  potential  to take a huge load off of the
immune  system  by  supplying  prefabricated  monoclonal  antibodies  needed  to
naturally fight the disease.  These antibodies are configured as pairs,  whereby
one  antibody  is  specific  to the target and is bound to the second  antibody,
which is specific  to a red blood cell  receptor,  other than the CR1  receptor.
Once  delivered,  the antibody pair attaches and populates the  circulating  red
blood cells and



                                       3
<PAGE>

begins  picking up  targeted  pathogens  or toxins.  The body can then focus its
efforts to the  clearing  of the  organism  rather  than  having to fight on all
fronts at the same time,  an effort that becomes  futile when dealing with these
types  of  exposure  or  disease.  STE  is a  platform  technology  that  can be
configured to address multiple pathogens through multiple  clearance  mechanisms
both individually and simultaneously.

         o        Our  diagnostic  technologies  are  based  on our  proprietary
                  Haystack Processing(TM)("HP") methods of analysis. HP requires
                  that a  sample  size  be  analyzed,  not  based  on  the  size
                  limitations  imposed by existing  technologies,  but rather by
                  what actual size is required to achieve the most  accurate and
                  reliable  results.  Thus, the search for early forms of cancer
                  or infectious diseases requires the analysis of a test tube or
                  two of blood rather than the  conventional or standard drop of
                  blood that is usually analyzed today. We also accomplish HP by
                  way of novel  methods of analyzing  large sample sizes for low
                  target numbers and by way of signal  amplification  techniques
                  that allow one isolated  target to appear as many.  We believe
                  some  of  the  signal  amplification  methods  we  have  under
                  development could  potentially  achieve up to a 40,000:1 boost
                  in the detectability of the target.

         o        We  believe   many   human   diagnostic,   animal   husbandry,
                  agricultural and quality control  applications will benefit by
                  implementing  HP  techniques  by  either  producing  increased
                  accuracy or by reducing  cost,  or with a  combination  of the
                  two. We have expended  great effort and expense to protect our
                  HP methodologies through patent protection.  We are developing
                  applications which could have such diverse implications as the
                  protection  of the blood  supply  from the West Nile Virus and
                  other  potential  contaminants,  to  developing  new or  novel
                  detection  methods to safeguard the food and water supply from
                  contamination.

         o        Our   research  and   development   efforts   geared   towards
                  accomplishing   molecular  HP,  hence  more  accurate  DNA/RNA
                  analysis,  have resulted in the development of what we believe
                  are unique and chemically modified synthetic DNA probes.

         Our probes have  several  distinct  properties  that make them  ideally
suited for two forms of gene therapy,  Antisense and RNAi. The more conventional
form of gene  therapy  that  may be  accomplished  by  these  probes  is  called
Antisense.  Many human diseases result from the abnormal  production of specific
proteins.  Antisense therapeutics strives to block the production,  not just the
effects, of these proteins.

         Proteins  are complex  molecules  that are  essential  to the  physical
development,  and physiological  function, of virtually all known forms of life.
The information that controls the amount and timing of protein production within
biological cells is encoded in the DNA located in the nucleus of each cell, thus
having a mechanism of controlling the production of disease causing proteins has
great promise in the potential  for  controlling  (and thereby the potential for
treating) many diseases. Recent and scientific advances now allow a new approach
to gene therapy through interfering with RNA or RNAi.  Messenger RNA ("mRNA") is
the product of genes  containing the information for the manufacture of proteins
coded for by the gene.

         Interfering  or  destroying  the targeted mRNA stops  improper  protein
synthesis and any disease  progression  by the protein is halted.  The synthetic
probes we have developed  inherently  have  properties  that may make them ideal
candidates  for both RNAi and  Antisense.  The human body, and in particular the
bloodstream,  is a very difficult  environment for the effective  functioning of
synthetic DNA probe based



                                       4
<PAGE>

therapies. The immune system, enzymes and variable physiological conditions such
as pH and salt  concentrations  degrade  or  disassociate  the drugs  from their
targets.  We believe that our reverse polarity  "hairpin"  probes  incorporating
modified bases are ideally suited to survive the harsh conditions present in the
human body.

         o        Our genetic characterization is based on conventional, as well
                  as  cutting  edge  third  party  technologies,  that have been
                  automated on our AGENDA(TM)robotic platform. Genetic profiling
                  involves   the  analysis  of  genes  in  search  for  sequence
                  variation that has clinically or otherwise been  determined to
                  be  relevant  as a  determinant  or  predisposing  factor  for
                  traits, disease or identification.  Genetic profiling has been
                  found  to  be  of  importance  in  forensics,  in  determining
                  predispositions to diseases, and analyzing individual drug and
                  nutrient  metabolism.   Our  method  of  determining  sequence
                  variation  requires two  independent  reactions to confirm the
                  result  (two  levels of  specificity),  thus we achieve a very
                  high   accuracy   of   results.    Results   from   the   gene
                  characterization,  combined with our know-how and expertise in
                  the field of DNA analysis,  allow for highly accurate  genetic
                  profiling.  Our plans call for securing a marketing  and sales
                  partner  with  an  established  distribution  network  to test
                  market a product in the first quarter of 2005.

         Since  CyGene,  Inc.  began  operations  in October  1995,  it has been
involved primarily in research and development. To date, CyGene, Inc. has had no
revenues from operations, and only limited interest income and debt forgiveness.

COMPETITION

         The biotechnology  industry is highly  competitive and characterized by
rapid and significant  technological change. We face, and will continue to face,
intense  competition from organizations such as pharmaceutical and biotechnology
companies,  as  well  as  academic  and  research  institutions  and  government
agencies.   Some  of  these   organizations   are  pursuing  products  based  on
technologies  similar to our  technologies.  Other of these  organizations  have
developed  and are  marketing  products,  or are  pursuing  other  technological
approaches  designed to produce products,  that are competitive with our product
candidates in the therapeutic, diagnostic and genetic profiling areas.

         Many of our competitors are  substantially  larger than we are and have
greater capital  resources,  research and development staffs and facilities than
we have. In addition,  many of our competitors are more  experienced than we are
in   diagnostic   test    development,    drug   discovery,    development   and
commercialization, obtaining regulatory approvals and drug or diagnostic product
manufacturing and marketing.

         We anticipate that the competition  with our products and  technologies
will be based on, among other things,  product  efficacy,  safety,  reliability,
availability,  price,  patent  position and effective  marketing.  The timing of
market  introduction of our products and  competitive  products will also affect
competition among products.  We also expect the relative speed with which we can
develop products, complete the clinical trials and approval processes and supply
commercial  quantities  of  the  products  to  the  market  to be  an  important
competitive  factor. Our competitive  position will also depend upon our ability
to attract  and retain  qualified  personnel,  to obtain  patent  protection  or
otherwise  develop  proprietary  products or processes and to secure  sufficient
capital resources for the period between technological conception and commercial
sales.




                                       5
<PAGE>

         Our competitors include: EluSys Therapeutics,  Inc., Roche Diagnostics,
Bayer  Diagnostics,  Abbott Labs,  Great Smokey  Mountain  Labs,  Hybridon Inc.,
Avigen Inc., Isis Pharmaceuticals, Inc. and Geron Corp.

INTELLECTUAL PROPERTY

         Patents and other  proprietary  rights are  important to our  business.
Thus it is our policy to seek patent protection for our inventions,  and also to
rely upon trade secrets,  know-how,  and continuing  technology  innovations and
licensing opportunities to develop and maintain our competitive position.

         We own  four  patents  one  additional  patent  allowed  and we have 20
additional technologies and technology processes patents pending.

1.       U.S. Patent No. 5,962,225 Issued
                  Title: Methods and Compositions for Detection of Specific
                         Nucleotide Sequences
2.       U.S. Patent No. 6,100,040 Issued
                  Title: Methods and Compositions for Detection of Specific
                         Nucleotide Sequences
3.       U.S. Patent No. 6,458,540 Issued
                  Title: Methods and Compositions for Detection of Specific
                         Nucleotide Sequences
4.       U.S. Patent No. 6,709,829 Issued
                  Title: Methods and Compositions for Detection of Disease
5.       U.S. Utility Patent Application No. 10/055,732 Allowed, Published as
         2003US0135040
                  Title: Compositions and Methods of Synthesis and Use of Novel
                         Nucleic Acid Structures
6.       Japanese Patent Application No. 9-516836 Pending, Published as
         WO 1997US15691
                  Title: Methods and Compositions for Detection of Specific
                         Nucleotide Sequences
7.       Canadian Patent Application No. 2,309,861 Pending, Published as
         WO 1999US24621
                  Methods and Compositions for Detection of Specific
                  Nucleotide Sequences
8.       South Korean Patent Application No. 7005156/2000 Pending, Published as
         WO 199US24621
                  Title: Methods and Compositions for Detection of Specific
                         Nucleotide Sequences
9.       Japanese Patent Application No. 2000-519613 Pending, Published as
         WO 1999US24621
                  Title: Methods and Compositions for Detection of Specific
                         Nucleotide Sequences
10.      Canadian Patent Application No. 2,447,892 Pending, Published as
         WO 2003US063763
                  Title: Complement Mediated Assays for In Vivo and In Vitro
                         Methods
11.      Japanese Patent Application (Number Pending) Pending, Published as
         WO 2003US063763
                  Title: Complement Mediated Assays for In Vivo and In Vitro
                         Methods
12.      EPO Patent Application No. EP02806678.5 Pending, Published as
         WO 2003US063763
                  Title: Complement Mediated Assays for In Vivo and In Vitro
                         Methods



                                       6
<PAGE>

13.      PCT/US03/04680 Patent Pending, Published as WO 2003US085123
                  Title: Methods and Compositions for In Vivo Clearance of
                         Pathogens
14.      U.S. Utility Patent Application No. 10/367,418 Pending, Published as
         2003US0232045
                  Title: Methods and Compositions for In Vivo Clearance of
                         Pathogens
15.      PCT/US03/18704 Patent Pending, Published as WO 2003US106695
                  Title: Methods and Compositions for In Vivo Clearance of
                         Pathogens
16.      U.S. Utility Patent Application No. 10/459,771 Pending, Published as
         2004US0033232
                  Title: Methods and Compositions for In Vivo Clearance of
                         Pathogens
17.      PCT/US02/39761 Patent Pending, Published as WO 2003US052144
                  Title: Diagnostic Assays for Biological Warfare Agents
18.      U.S. Utility Patent Application No. 10/319,068 Pending, Published as
         2004US0029135
                  Title: Diagnostic Assays for Biological Warfare Agents
19.      EPO Patent Application No. EP00975496.1 Pending, Published as
         2001W032924
                  Title: Compositions and Methods of Synthesis and Use of Novel
                         Nucleic Acid Structures
20.      U.S. Utility Patent Application No. 10/446,201 Pending, Published as
         2004US0029160
                  Title: Parallel Stranded Duplexes of Deoxyribonucleic Acid and
                         Methods of Use

EMPLOYEES

         As of September 7, 2004,  we employ six full-time  employees,  and five
part-time employees. Of our 11 employees,  two are associated with our executive
office,  three  are  associated  with  our  operations,  and the  remainder  are
associated  with research and  development  activities  in-house and at off-site
laboratories.

ITEM 2. DESCRIPTION OF PROPERTY

         We currently lease approximately 2,500 square feet of commercial office
space  in  Coral  Springs,   Florida,   which   encompasses  our  executive  and
administrative  offices and a portion of our operating activities.  We currently
lease  this  space  under a month to month  arrangement  at a rate of $3,600 per
month.

         On August 5, 2004, we entered into a five-year lease for a 7,100 square
foot, newly constructed,  facility in a professional office park, with base rent
of  approximately  $11,692 per month,  subject to an annual  increase of 2%. The
lease is renewable for an additional  five-year term at a 5% rent  increase.  We
also have a right of first  refusal  on  additional  rental  space  owned by the
landlord in the same development park as well as a right of first refusal on the
purchase of the entire building.

         We have  retained an  architect  to custom  design the  interior of the
building to our  specifications.  The landlord has provided for a $20 per square
foot leasehold improvement allowance that is required to be repaid to us.



                                       7
<PAGE>

ITEM 3. LEGAL PROCEEDINGS

         We are not aware of any legal proceedings against us.

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

         Not applicable.

                                     PART II

ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

OUR COMMON STOCK

         The  principal  market  for our  common  stock is the  Over-the-Counter
Bulletin  Board,  where our common stock trades under the symbol  "CYGE.OB." The
prices below are based on high and low reported sales prices.

FISCAL YEAR ENDING MARCH 31, 2005                HIGH               LOW
(THROUGH THE DATE OF THIS REPORT)              --------            ------
First Quarter (4/1/04 to 6/30/04)              $   1.17            $ 0.80
Second Quarter (7/1/04 to 9/09/04)             $   1.65            $ 0.45

FISCAL YEAR ENDING MARCH 31, 2004
First Quarter (4/1/03 to 6/30/03)              $   0.25            $ 0.03
Second Quarter (7/1/03 to 9/30/03)             $   0.79            $ 0.13
Third Quarter (10/1/03 to 12/31/03)            $   1.25            $ 0.50
Fourth Quarter (1/2/04 to 3/31/04)             $   1.10            $ 0.61

FISCAL YEAR ENDED MARCH 31, 2003
First Quarter (4/1/02 to 6/30/02)              $   0.00            $ 0.00
Second Quarter (7/1/02 to 9/30/02)             $   0.03            $ 0.00
Third Quarter (10/1/02 to 12/31/02)            $   0.03            $ 0.01
Fourth Quarter (1/2/03 to 3/31/03)             $   0.10            $ 0.01

STOCKHOLDERS

         As of September 7, 2004, there were approximately 588 holders of record
of our common stock.



                                       8
<PAGE>

DIVIDENDS

         We have not  declared  nor paid any cash  dividends on our common stock
for our last  two  fiscal  years  nor in any  subsequent  period.  We  currently
anticipate  that  we  will  retain  all of our  future  earnings  for use in the
expansion and operation of our business,  thus we do not  anticipate  paying any
cash dividends on our common stock in the foreseeable future.

         In connection  with our merger on September  30, 2003,  pursuant to the
terms  of the  merger,  we  effected  a stock  dividend  payable  effective  for
stockholders  of record on  September  29,  2003,  of 0.58 shares for each share
owned,  so that the shares  owned by them and the shares  received as a dividend
were approximately 15% of our issued and outstanding shares.  Additionally,  our
current  assets and future  royalties as they existed on September 29, 2003 were
placed into a trust for the benefit of our  stockholders  of record as of a date
prior to the merger.

PURCHASES OF EQUITY SECURITIES

         During the fiscal year ended March 31,  2004,  we did not  purchase any
outstanding  shares of our common stock,  nor did any person or entity  purchase
any of our outstanding equity securities on our behalf.

RECENT SALES OF UNREGISTERED SECURITIES

         During the quarter ended March 31, 2004, we made the following sales of
unregistered securities:
<TABLE>
<CAPTION>

        TYPE OF SALE                           PRICE                         AMOUNT RECEIVED               SHARES ISSUED
----------------------------- ----------------------------------------- --------------------------- -----------------------------
<S>                           <C>                                       <C>                        <C>
Private Placement                                               $0.225                 $290,250.15                     1,289,993
----------------------------- ----------------------------------------- --------------------------- -----------------------------
Fee for Services                                                $0.225                  $32,054.00                       142,462
----------------------------- ----------------------------------------- --------------------------- -----------------------------
Dispute Settlement                                               $0.50                  $73,323.00                       146,646
----------------------------- ----------------------------------------- --------------------------- -----------------------------
Reg. S. Offering                        Various Prices Average  ~$0.35                 $124,875.00                       355,368
----------------------------- ----------------------------------------- --------------------------- -----------------------------
Convertible Notes                                             $0.07143                  $15,500.80                       217,006
----------------------------- ----------------------------------------- --------------------------- -----------------------------
           TOTAL                                                                       $536,002.95                     2,151,475
----------------------------- ----------------------------------------- --------------------------- -----------------------------
</TABLE>


         Pursuant to our merger on September 30, 2003,  the common  stockholders
of CyGene, Inc., who were accredited investors, plus the largest 35 unaccredited
investors, received approximately 85% of our issued and outstanding common stock
or 30,975,838  shares,  and the remaining  CyGene,  Inc.  stockholders  received
$0.07143 per share of their  CyGene,  Inc.  common stock in exchange for 100% of
the capital stock of CyGene,  Inc. Our  stockholders  as determined  immediately
prior to the merger  retained  approximately  15% of our issued and  outstanding
common stock.

ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS

         The following discussion contained in this Item 6 is incomplete.  It is
incomplete  because we are  awaiting  completion  of the audit of our  financial
statements  for the year ended March 31, 2004. The delay is due to the fact that
we are  required to present our  financial  statements  on a  development  stage
basis.  For  additional  details,  please  see the  discussion  in Item 1 above.
Therefore, the following discussion does not



                                       9
<PAGE>

contain  certain  information  required by Item 6, including a discussion of our
consolidated  results of  operations.  Once the audit is complete,  we intend to
file an amendment to this Form 10-KSB,  which will include such  information and
discussion.  Therefore,  the following  discussion  should not be relied upon in
making any investment or other decision with respect to the securities of CyGene
Laboratories, Inc. or otherwise.

         The  following  discussion of our  financial  condition  should be read
together with our  financial  statements  and related  notes  provided in Item 7
below.  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.
Specifically,  the forward-looking statements relating to our planned transition
to a new facility and  anticipated  improvements to such planned  facility,  our
strategy  described  in  Item 1  including  the  possibility  of  entering  into
strategic  partnerships,  alliances,  and collaborations,  our prospects for our
technologies and intellectual  property  including the boost in detectability in
the signal amplification  methods under development,  our plans and expectations
regarding  commercialization  and marketing  efforts,  our ability to create and
market products and services based on our  technologies,  the anticipated  need,
desirability, and demand for our technologies and any products or services based
on such  technologies,  our  need to  raise  additional  capital  from  external
sources,  our ability to generate  cash to  internally  fund some of our working
capital  needs,  industry and  regulatory  trends,  future  advertising,  public
relations,  and marketing  costs and  expenditures  as well as the prospect of a
positive  return  on  investment  from  such  costs  and  expenditures  by their
generation  of revenue,  future  research and  development,  the amount of funds
needed over the next 12 months,  our future  liquidity,  anticipated  employment
levels  for 2004 and 2005,  and our  anticipated  capital  assets  expenditures.
Additionally,  words  such as  "anticipates,"  "expects,"  "believes,"  "plans,"
"could,"  "may,"  and  similar  words  and  phrases   identify   forward-looking
statements.

         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;  private or public sector demand
for  products  and   services   similar  to  what  we  plan  to   commercialize;
unpredictable or unforeseen changes in the state of the art in genetic analysis,
sequencing,  testing, and therapy; the risk of altered or increased governmental
regulation relating to genetics, genetic analysis, drugs,  pharmaceuticals,  and
medical  devices,  as well as currently  unregulated,  or  minimally  regulated,
substances and processes, and their impact on our costs and expenses, and on our
potential commercialization of our technologies; altered or increased regulation
impacting the cost or our ability to store,  handle, ship and control substances
and  materials;  our  ability to  attract  and retain  qualified  and  competent
scientific  and  management  personnel;  the  availability,  costs  and terms of
financing,  including the risk of rising interest rates and its potential impact
on our future cost of capital and the future  market price of our common  stock.
Additionally, see the discussion on forward-looking statements that follows this
section and those  contained in "Special  Factors  Relating to Our Business." 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.




                                       10
<PAGE>

CRITICAL ACCOUNTING POLICIES

         The  preparation  of  consolidated  financial  statements  and  related
disclosures in conformity with accounting  principles  generally accepted in the
United  States  requires  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 consolidated  financial  statements
and  accompanying  notes.  The Securities and Exchange  Commission has defined a
company's  critical  accounting  policies as the ones that are most important to
the portrayal of the company's  financial  condition and results of  operations,
and  which  require  the  company  to make its  most  difficult  and  subjective
judgments,  often as a result of the need to make  estimates of matters that are
inherently  uncertain.  We  believe  that  our  estimates  and  assumptions  are
reasonable under the circumstances;  however, actual results may vary from these
estimates and assumptions.  We have identified the following critical accounting
policies that affect the more  significant  judgments and estimates  used in the
preparation of our consolidated financial statements.

         DEVELOPMENT STAGE REPORTING

         We have been, and are, a development stage enterprise.  We have devoted
substantially  all of our efforts and  resources to financial  planning,  to the
raising of needed capital,  and to research and  development.  Accordingly,  our
financial  statements  will be prepared in accordance  with the  accounting  and
reporting  principles  prescribed by Statement of Financial Standards (SFAS) No.
7, "Accounting and Reporting by Development  Stage  Enterprises,"  issued by the
Financial Accounting Standards Board.

         REVENUE RECOGNITION

         We  expect,  once  we  commence  marketing  and  sales  activities,  to
recognize  revenue from sales of our testing  services and other  products  when
goods are shipped and title or risk of loss resides with the end customer, which
typically occurs when the customer accepts the shipment and products.

         RESEARCH, DEVELOPMENT AND RELATED ENGINEERING COSTS

         Research,  development, and related engineering,  costs are expensed as
incurred.

         LITIGATION

         We may  periodically  become  involved  in  litigation  and  regulatory
proceedings  incidental to the normal conduct of business, and we expect that we
may be involved in such litigation and regulatory proceedings from time to time.
It is our  policy  to  regularly  review  any  such  litigation  and  regulatory
proceedings  for  possible  adverse  outcomes,  and  provide  estimates  for the
possible  liability to us from such adverse  outcomes,  as appropriate under the
circumstances.

OVERVIEW

         Fiscal 2004 saw a fundamental  change in the nature and business of the
company. Highlights were:

         o        Effective  September 30, 2003, we engaged in a reverse  merger
                  with CyGene, Inc. Immediately prior to the merger, we declared
                  a special  dividend  of our assets to  stockholders  of record
                  prior to the  merger so that as of the  merger we were a shell
                  corporation without any operations;



                                       11
<PAGE>

         o        Under generally accepted accounting principles,  the financial
                  statements and other financial  information which we intend to
                  file in an  amendment  to this  Form  10-KSB  will be those of
                  CyGene, Inc.;

         o        CyGene,   Inc.   has  not   generated   any  revenue  and  has
                  concentrated  its  efforts  on  taking  steps  to be  able  to
                  commercialize its products.  But it has been severely hampered
                  by the lack of working capital;

         We  hired  new  auditors  who  advised  us  that  our  prior  financial
statements should have been accounted for as a development stage business.

LIQUIDITY AND CAPITAL RESOURCES

         During  fiscal year 2003,  CyGene,  Inc.  raised  $228,895 from private
placements  of its common stock,  and received  $73,284 in debt  financing  from
outside parties.  During the year, it employed these resources to fund operating
activities, purchase $3,945 in property and equipment and repay $54,110 in notes
payable.  Additionally,  it acquired $28,762 in property and equipment in return
for a note payable,  converted  $142,585 of combined accrued  interest,  capital
leases and notes payable into common stock,  and issued  $81,500 of common stock
in return for services rendered to it during the year.

         During fiscal year 2004, we raised  $1,112,770 from private  placements
of our common  stock,  and  received  $202,700 in debt  financing  from  outside
parties.  During  the  year,  we  employed  these  resources  to fund  operating
activities,  acquire  $24,828 in property and  equipment,  and repay $182,965 in
notes payable.  Additionally, we converted $2,273,952 of combined trade accounts
payable, accrued interest and note payables to common stock, and issued $883.760
of common stock in return for services  rendered during the year. The discussion
in this section  refers solely to CyGene,  Inc.  through  September 30, 2003 and
CyGene Laboratories,  Inc. thereafter.

         During  fiscal year 2004,  we were largely  reliant on  financing  from
outside parties to fund  operations.  We believe that due to our working capital
deficits described above, combined with uncertainty related to the timing of our
planned  commercialization  of  our  technologies  into  viable  and  marketable
products  and  services,  create the  necessity to acquire  additional  external
capital  funding.  We believe such  additional  capital is necessary to fund our
operating expenses,  to make capital  expenditures,  to service our debt, and to
execute anticipated marketing and research and development plans.

         As of March 31, 2004, we had a working  capital  deficit of $1,559,335,
which number is subject to change  based on the  completion  of the audit.  On a
consolidated  basis,  cash on hand was  $145,696  as of March  31,  2004.  As of
September  7th, our cash balances were  approximately  $140,000.  In the quarter
ending June 30, 2004, we raised $403,500 from the sale of shares of common stock
to investors  outside of the United  States  pursuant to Regulation S at varying
market prices per share. From July 1st, 2004 through the date of this Report, we
have  raised  $137,900  from the sale of  shares of  common  stock to  investors
outside of the United States  pursuant to Regulation S at varying  market prices
per share. The offering has been terminated. In July 2004, we raised $180,000 in
a private placement to accredited investors from the sale of units consisting of
one share of common stock and one stock purchase  warrant at $0.40 per unit. The
warrants are exercisable at $0.40 for a period of two years.

         We anticipate that an additional $3 million may be required to meet our
operating  requirements  during the next 12 months. In order to meet our working
capital needs, in late July 2004, we entered into a letter of



                                       12
<PAGE>

intent with a New York-based  broker-dealer  to initially raise between $750,000
and $1,250,000 in bridge loan  financing  with warrants  attached and then raise
between  $4,000,000 to  $6,000,000 in the sale of Series A Preferred  Stock with
warrants  attached.  We have raised  $160,000 of the bridge loan financing as of
the date of this Report,  although we expect that we will receive  further funds
once this  Report is filed with the  Securities  and  Exchange  Commission.  The
Series A Preferred  Stock  offering will only occur if the bridge loan financing
is  raised  and is  subject  to the  broker-dealer's  continuing  due  diligence
including its review of this Report of the necessary  documentation,  as well as
other customary financing and closing contingencies preparation. There can be no
assurances  that we will be successful in raising any funds in the  contemplated
offerings.  Any significant  shortfall may result in the delay,  scaling back or
elimination of some or all of our research and development  activities and other
operations planned or currently underway. Additionally, unless we raise at least
$1,000,000,  we will not be able to remain  operational over the next six months
even if we scale back our operations.

         If we raise at least  $3,000,000.00  from other  sources,  we  believe,
based on our  current  expectations  and  plans,  that  sufficient  capital  and
investments  will be available to fund our cash  requirements  through the third
quarter of 2005. Actual cash requirements may depend on many factors,  including
particularly  the scope and pace of product  sales and  marketing,  research and
development  efforts  and the  level  of  success  in  entering  into  strategic
alliances. Additionally, we are seeking to hire employees and retain consultants
by  compensating  them in part with grants of common  stock,  stock  options and
warrants.  To the extent that the market price of our common  stock  remains low
and liquidity is limited,  we believe we may  encounter  difficulty in employing
and retaining skilled individuals and outside consultants.

         We also expect to generate  additional  funds  internally  by providing
genetic  profiling  services that will be sold through retail  distributors  and
directly to the public.  We also expect to continue to seek additional  external
funds  from  collaborations   with  other   biotechnology   companies  and  with
pharmaceutical  companies,  and  potentially  from other debt,  equity and lease
financings.  We  anticipate  the key  factors  affecting  our future  sources of
internal and external funding to be:

         o        the success of our commercialization,  marketing, and sales of
                  our genetic profiling services;

         o        the  success  of  our  clinical  and  preclinical  development
                  programs;

         o        the  receptivity  of the  capital  markets  to  financings  by
                  biotechnology companies; and

         o        our ability to enter into strategic partnerships and alliances
                  with  biotechnology  and  pharmaceutical   companies  and  the
                  success of such relationships.

SPECIAL FACTORS RELATING TO OUR BUSINESS

WE ARE A DEVELOPMENT STAGE COMPANY AND HAVE NOT COMMERCIALIZED ANY PRODUCTS.

         We are in the development  stage and have not completed  development of
nor commercialized any of our proposed products or technologies.  Our viability,
profitability  and growth  will  depend  upon  successful  commercialization  of
products and  technologies  resulting from our research and product  development
activities.  There can be no  assurance  that any of our  proposed  products  or
technology will be



                                       13
<PAGE>

commercialized.  Further,  as a  development  stage  company,  we have a limited
operating  history upon which an evaluation  of our prospects can be made.  Such
prospects  must be considered in light of the risks,  expenses and  difficulties
frequently encountered in the shift from development to commercialization of new
products  based  on  innovative  technology.   See  "Management's  Discussion  &
Analysis" and Consolidated Financial Statements.

OUR PLANNED COMMERCIALIZATION AND MARKETING EFFORTS MAY NOT BE EFFECTIVE.

         We believe we have the opportunity to become a market leader in genetic
profiling. However, to do so, we believe we must make significant investments in
marketing our technologies  and our planned  products and services.  At present,
the market for genetic  profiling  services is relatively small.  Thus,  greater
consumer  and user  awareness  must be achieved and we believe this must be done
through increased marketing efforts. Our prospective clients must be educated as
to the  value  of our  technologies  and  services  and the  knowledge  they can
deliver.  Larger and  better-financed  competitors  may be alerted to the market
opportunity,  thus losing our potential to acquire a leadership  position in the
market and significant share of any potential revenues.

OUR INDUSTRY IS HIGHLY COMPETITIVE.

         The biotechnology  industry is highly  competitive and characterized by
rapid  and  significant   technological   change.  We  expect  to  face  intense
competition  from   organizations   such  as   pharmaceutical,   healthcare  and
biotechnology  firms,  as  well  as  academic  and  research  institutions,  and
governmental  agencies  and  institutions.   Some  of  these  organizations  and
institutions  are  pursuing  technologies,  as well as  products  and  services,
similar  to  our  technologies.  Other  organizations  have  developed  and  are
marketing products or services,  or are pursuing other technological  approaches
which  could  produce  products  and  services  that  are  competitive  with our
technologies in the diagnostic and genetic profiling areas.

         In  addition,  many  participants  in the  biotechnology  industry  are
substantially larger than we are, and have greater capital resources, larger and
more skilled  research and  development  staffs,  and larger or better  equipped
facilities than us. In addition, many potential competitors are more experienced
than we are in diagnostic  test  development,  the  regulatory  process,  and in
diagnostic product manufacturing and marketing.

         We anticipate that once we commence our commercialization and marketing
efforts,  competition  will be based on, among other things,  product  efficacy,
safety,  reliability,   availability,   price,  performance,   accuracy,  patent
position,  and  effective  marketing.  We believe  that our  future  competitive
position  will also  depend on our  ability  to attract  and  retain  additional
qualified personnel, to obtain patent or other intellectual property protection,
or otherwise develop proprietary products or processes, and to secure sufficient
capital resources for the period between technological  conception,  development
and ultimately commercial sales.

OUR ABILITY TO ATTRACT,  COMPENSATE, AND RETAIN KEY PERSONNEL IS CRITICAL TO OUR
SUCCESS.

         We believe our success  will be highly  dependent  on the  retention of
principal members of our current  technical and management staff,  including Mr.
Martin Munzer, our Chief Executive Officer.  We believe the loss of Mr. Munzer's
services would be detrimental to our company.  Furthermore,  we anticipate  that
future growth,  if any, will require  hiring a significant  number of additional
qualified technical and



                                       14
<PAGE>

management  personnel  including a Chief  Financial  Officer.  Accordingly,  the
recruiting and retaining of such personnel in the future will be critical to our
success.  There is intense  competition from other  companies,  and research and
academic institutions,  for qualified scientific and management personnel in our
industry.  If we are not able to attract and retain,  on acceptable  terms,  the
qualified personnel necessary to become competitive in our industry,  we may not
be able to sustain our current operations or grow in the future.

THE BIOTECHNOLOGY INDUSTRY IS SUBJECT TO INCREASED REGULATORY UNCERTAINTY DUE TO
THE RAPIDLY  CHANGING  NATURE OF THE STATE OF THE ART,  SCIENTIFIC  ADVANCES AND
DISCOVERIES, AND AS NEW TECHNOLOGIES ARE DEVELOPED.

         We expect  that many of the  products and  services  that we are in the
process of developing will require additional research and development,  and may
require  regulatory  approval  prior to any  commercial  sales.  This process is
lengthy,  often  taking a number of years,  and  requires  sometimes  meticulous
attention from experienced  personnel in furthering our objectives.  Our company
has only limited experience in filing and prosecuting the applications necessary
to gain regulatory  approvals.  Moreover,  the products and services that result
from research and development  programs will likely be based on new technologies
and new diagnostic and  therapeutic  approaches  that have not been  extensively
tested in humans. As a result, we may experience a longer regulatory  process in
connection  with any  product  or  service  that we  develop  based on these new
technologies or new diagnostic and therapeutic approaches.

IF WE FAIL TO RAISE SUFFICIENT CAPITAL IN OUR CURRENT PRIVATE PLACEMENT,  WE MAY
NOT BE ABLE TO REMAIN OPERATIONAL.

         As described in "-Liquidity  and Capital  Resources," we entered into a
letter of intent with a  broker-dealer  to raise debt and equity capital for us.
We are  dependent  upon the  receipt of these  funds to remain  operational  and
commercialize  our products.  If we do not receive  sufficient  funds from these
pending offerings, we may not be able to remain in business.

WE MAY NOT BE ABLE TO RAISE ADDITIONAL NEEDED CAPITAL OR FINANCING.

         As a development  stage company,  we have funded our expenditures  with
externally  acquired  capital  every  year  since  our  inception.  We expect to
continue  to incur  operating  losses in future  periods,  and cannot be certain
whether or when we will become  profitable,  if ever, because of the significant
uncertainties  with  respect to our ability to  successfully  market our genetic
profiling  products  (and related  services)  and from any  potential  strategic
partnerships and alliances. Until such time as we have operations which generate
sufficient  cash flows to fund  operations,  we will continue to rely on capital
from equity and debt sources, vendor financing and equipment leasing.

OUR  PATENTS,  AND  THOSE OF OTHER  BIOTECHNOLOGY  AND  RELATED  COMPANIES,  ARE
GENERALLY UNCERTAIN AND INVOLVE COMPLEX LEGAL, SCIENTIFIC AND FACTUAL QUESTIONS.

         We believe  that the  ability to develop and  commercialize  diagnostic
products and other  technologies  will depend in significant part on our ability
to:

         o        obtain patents;

         o        obtain  licenses  to  the  proprietary  rights  of  others  on
                  commercially reasonable terms;

         o        operate  without  infringing  upon the  proprietary  rights of
                  others;



                                       15
<PAGE>

         o        prevent others from infringing on our proprietary rights; and

         o        protect trade secrets.

         Our existing  patents,  and those that may be issued in the future,  or
those licensed to us, may be challenged,  invalidated, or circumvented,  and the
rights  granted  thereunder  may not provide us with  proprietary  protection or
competitive advantages against competitors with similar technology. Furthermore,
our competitors may independently  develop similar technologies or duplicate any
technology developed by us.

         We may not have  rights  under  some  patents  or  patent  applications
related to our technologies.  Third parties may own or control these patents and
patent applications in the United States and abroad.  Therefore,  in some cases,
we may choose to seek,  or be  required  to seek,  licenses  under  third  party
patents  issued in the United  States and abroad or those that might  issue from
United States or abroad.  In such event,  we may be required to pay license fees
or royalties  or both to the  licensor.  If licenses are not  available to us on
acceptable terms, we may not be able to develop,  manufacture, or sell or import
products and services utilizing the technology.

WE MAY FACE RISKS RELATED TO INTELLECTUAL PROPERTY LITIGATION.

         There has been substantial  litigation and other proceedings  regarding
the patent and other intellectual property rights in the biotechnology industry.
From time to time, we may become a party to various  types of patent  litigation
or other proceedings  regarding  intellectual property rights. The cost to us of
any patent litigation or other proceeding,  including these interferences,  even
if resolved in our favor,  could be substantial.  Our future  competitors may be
able to sustain the cost of such  litigation  or  proceedings  more  effectively
because  of their  substantially  greater  financial  resources.  If any  patent
litigation or other  proceeding is resolved  adversely,  we may be enjoined from
developing,  manufacturing,  or  selling  products  and  services  based  on the
technology and, furthermore,  may be held liable for significant damages. We may
not be able to obtain any required  license on commercially  acceptable terms or
at all.

         Uncertainties  resulting from the initiation and continuation of patent
litigation  or other  proceedings  could have a material  adverse  effect on our
ability to compete in the marketplace.  Patent  litigation and other proceedings
may also absorb significant management time.

FOR OUR GENETIC PROFILING SERVICE PRODUCTS AND OTHER PRODUCTS IN DEVELOPMENT, WE
WILL FACE  COMPETITION  WITH  RESPECT TO ITS BRAND  NAME(S),  COMMERCIAL  SALES,
MARKETING AND DISTRIBUTION.

         These are areas in which our  personnel  have  limited  experience.  To
market  products  directly,  we will need to develop a marketing and sales force
with  technical   expertise  and  with   supporting   distribution   capability.
Alternatively,  we may seek to engage retail distributors,  or pharmaceutical or
other healthcare companies,  with existing distribution systems and direct sales
forces  to  assist  us.  There  can be no  assurance  that we will  successfully
establish  effective brand names,  sales and  distribution  capabilities or gain
market acceptance for our products. To the extent we enter co-promotion or other
licensing  arrangements,  any  revenues we receive will depend on the efforts of
third parties and there can be no assurance that such efforts will succeed.




                                       16
<PAGE>

         If in the future our management elects to perform sales,  marketing and
distribution  functions for such types of products  internally,  we would face a
number of  additional  risks,  including  the need to recruit a large  number of
additional experienced marketing and sales personnel.

WE MAY NOT BE ABLE TO ADEQUATELY  INSURE  AGAINST THE RISK OF PRODUCT  LIABILITY
CLAIMS.

         Once  we  commercialize   our  technologies  and  commence  selling  or
licensing them, we may be exposed to the risk of product liability  claims,  and
therefore  we plan to seek to  mitigate  these  risks,  to the extent  possible,
through acquiring appropriate product liability insurance.  This insurance would
be subject to deductibles  and coverage  limitations,  and we may not be able to
obtain or maintain adequate protection against potential  liabilities subject to
changes in  premiums,  deductibles  and  coverage  options.  If we are unable to
obtain  insurance at an acceptable cost or otherwise  protect against  potential
product liability claims, we could be exposed to significant liabilities,  which
may materially and adversely affect our business and financial  position.  These
liabilities could prevent or interfere with our commercialization efforts.

RISKS RELATED TO OUR COMMON STOCK

WE MAY ISSUE COMMON OR PREFERRED STOCK WITHOUT THE APPROVAL OF OUR  STOCKHOLDERS
WITH FEATURES WHICH COULD MAKE IT MORE DIFFICULT FOR A THIRD PARTY TO ACQUIRE US
AND COULD DEPRESS OUR STOCK PRICE

         In the future,  our board of directors  may issue one or more series of
common or preferred  stock that has more than one vote per share  without a vote
of our stockholders. This could permit our board of directors to issue preferred
stock to  investors  who  support our  management  and  increase  control of our
business  by  management.  Additionally,  issuance  of super  voting  common  or
preferred  stock could block an  acquisition,  even if an  acquisition is in the
best  interest of the  stockholders.  This could  cause the market  price of our
common stock to drop significantly.

BECAUSE  OUR  COMMON  STOCK  WILL NOT BE LISTED ON A STOCK  EXCHANGE  OR NASDAQ,
INVESTORS MAY BE UNABLE TO RESELL THEM

         Since our common  stock only  trades on the  Over-the-Counter  Bulletin
Board,  and has  extremely  limited  trading  volume,  your ability to sell your
common stock may be severely restricted.  Accordingly, investors must be able to
bear the financial risk of losing their entire investment.

THE PRICE OF THE COMMON STOCK MAY BE HIGHLY  VOLATILE,  AND INVESTORS MAY NOT BE
ABLE TO SELL THE COMMON STOCK AT OR ABOVE MARKET PRICES

         The market price for our common stock may be highly  volatile.  As long
as the future market for the common stock is limited, investors who purchase the
common stock may only be able to sell them, if at all, at a loss.


WE ARE SUBJECT TO THE "PENNY STOCK" RULES WHICH  ADVERSELY  EFFECT THE LIQUIDITY
OF OUR COMMON STOCK.

         The Securities and Exchange  Commission ("SEC") has adopted regulations
which generally  define "penny stock" to be an equity security that has a market
price of less than $5.00 per share, subject to specific  exemptions.  Presently,
the market price of our common stock is substantially less than $5.00 per



                                       17
<PAGE>

share and therefore is  designated  as a "penny  stock"  according to SEC rules.
This designation requires any broker-dealer selling these securities to disclose
certain information concerning the transaction,  obtain a written agreement from
the  purchaser  and  determine  that the  purchaser  is  reasonably  suitable to
purchase  the  securities.  These rules limit the ability of  broker-dealers  to
solicit  purchases of our common stock and therefore reduce the liquidity of the
public market for our shares.

ITEM 7. FINANCIAL STATEMENTS.

         This Item 7 is incomplete. It does not contain our financial statements
or  accompanying  notes because we are awaiting  completion of the audit for the
year ended March 31, 2004.  The delay is due to the fact that we are required to
present our financial  statements on a development  stage basis.  For additional
details,  please see the discussion in Item 1 above. Once the audit is complete,
we intend to file an  amendment  to this Form  10-KSB,  which will  include such
financial statements, accompanying notes, and audit report.

ITEM  8.  CHANGES  IN AND  DISAGREEMENTS  WITH  ACCOUNTANTS  ON  ACCOUNTING  AND
FINANCIAL DISCLOSURE

         As we  previously  reported  in our Form 8-K filed on May 5,  2004,  we
dismissed Brimmer, Burek and Keelan LLP as our principal accountant and on April
29, 2004,  we engaged  Eisner LLP as our principal  accountant.  The decision to
change principal accountants was approved by the Board of Directors.  We had not
consulted  with  Eisner LLP on any matter  during  fiscal  year 2003 or prior to
their engagement for fiscal year 2004.

         Brimmer,  Burek & Keelan LLP's  reports on our  consolidated  financial
statements for the fiscal years ended March 31, 2002 and 2003 did not contain an
adverse opinion or a disclaimer of opinion, and was not qualified or modified as
to audit scope, or accounting  principles,  except that Brimmer,  Burek & Keelan
LLP's  report  was  modified  by  the  inclusion  of  an  explanatory  paragraph
addressing  the ability of the company to  continue as a going  concern.  During
fiscal 2003 and 2002,  there have been no  disagreements  with Brimmer,  Burek &
Keelan,  LLP on any matter of  accounting  principles  or  practices,  financial
statement disclosure, or auditing scope or procedure,  which, if not resolved to
the  satisfaction  of Brimmer,  Burek & Keelan LLP, would have caused it to make
reference  to  the  subject  matter  in  connection  with  its  reports  on  our
consolidated  financial  statements  for such  years,  nor have  there  been any
reportable  events as listed in Item  304(a)(1)(v) of Regulation  S-B.  However,
because our prior financial  statements were not prepared on a development stage
basis,  we will amend those reports filed after  September 30, 2003 with the SEC
to change the financial statements. We do not know, but believe Brimmer, Burek &
Keelan LLP may disagree with the development stage approach.

ITEM 8A. CONTROLS AND PROCEDURES

         We  carried  out  an  evaluation  required  by  Rule  13a-15(b)  of the
Securities  Exchange Act of 1934 (the "Exchange  Act") under the supervision and
with the participation of management, including Mr. Martin Munzer, who serves as
our chief executive officer and chief financial officer, of the effectiveness of
the design and operation of our  "disclosure  controls and procedures" as of the
end of the period covered by this Report.

         Disclosure  controls and  procedures are designed with the objective of
ensuring that (i)  information  required to be disclosed in an issuer's  reports
filed under the Exchange Act is recorded, processed,



                                       18
<PAGE>

summarized and reported  within the time periods  specified in the SEC rules and
forms and (ii)  information  is  accumulated  and  communicated  to  management,
including  our  chief  executive  officer  and  chief  financial   officer,   as
appropriate to allow timely decisions regarding required disclosures.

         The  evaluation of our disclosure  controls and  procedures  included a
review of our objectives and processes and effect on the  information  generated
for use in this Report.  This type of evaluation  will be done quarterly so that
the conclusions  concerning the  effectiveness of these controls can be reported
in our periodic reports filed with the SEC. We intend to maintain these controls
as processes that may be appropriately modified as circumstances warrant.

         Based on our chief  executive  officer  and chief  financial  officer's
evaluation,  he has concluded  that our  disclosure  controls and procedures are
effective in alerting him in a timely manner to material information relating to
the Company that is required to be included in our periodic  reports  filed with
the SEC as of the filing of this  Report.  There were no changes in our internal
control over financial  reporting  that occurred  during our last fiscal quarter
that have materially  affected,  or are reasonably likely to materially  affect,
our internal control over financial  reporting.  However,  a control system,  no
matter how well  conceived  and  operated,  can  provide  only  reasonable,  not
absolute,  assurance  that  the  objectives  of  the  control  system  are  met.
Management  necessarily  applied  its  judgment  in  assessing  the  benefits of
controls  relative to their costs.  Because of the inherent  limitations  in all
control systems,  no evaluation of controls can provide absolute  assurance that
all control issues and instances of fraud,  if any, within the company have been
detected.  The design of any system of  controls  is based in part upon  certain
assumptions about 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, regardless of how remote. Because of the inherent limitations
in a control system,  misstatements  due to error or fraud may occur and may not
be detected.




                                       19
<PAGE>

                                    PART III

ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE
WITH SECTION 16(A) OF THE EXCHANGE ACT DIRECTORS AND EXECUTIVE OFFICERS

      NAME                   AGE                          POSITION
      ----                   ---                          --------

Martin Munzer                 52         Chairman of the Board, CEO, and CFO
Walter W. Witoshkin           59         Vice President of Strategic Development
Ray J. Romano                 53         Member of the Board of Directors
John Signorelli               62         Member of the Board of Directors
Stanley Satz                  61         Member of the Board of Directors



         Martin M. Munzer has been our CEO,  CFO,  and  Chairman of the Board of
Directors,  since  September 30, 2003, the date of our merger.  From 1999 to the
present,  he was and is the CEO and CFO of  CyGene,  Inc.  He  joined  CyGene in
August 1997 as Vice President.

         Raymond J.  Romano has been one of our  directors  since  inception  in
1986. He was also our former CEO and Chairman of the Board of Directors from our
inception through September 30, 2003, the date of our merger with CyGene,  Inc.
Mr. Romano has been Vice President of Lodging  Concepts,  Inc., a privately held
corporation in Fairfield, New Jersey since January 1990.

         John J.  Signorelli  has been one of our  directors  since 1987. He has
been retired since April 2001. Since retiring,  he occasionally  provides health
care consulting services on a part-time basis.

         Stanley Satz has been one of our  directors  since  September 30, 2003,
the date of our merger.  From 1995 to present he was and is President  and Chief
Scientific  Officer of  BioNucleonics,  Inc., a privately  held  corporation  in
Miami, Florida since 1995. He has 20 years of experience in product development,
including   diagnostic  and  therapeutic   radiopharmaceuticals,   and  led  the
development  and GMP  production  of  Strontium  Chloride  Sr-89,  Injection,  a
therapeutic for treatment of cancer bone pain, approved by the FDA in 2003. This
background  has  given  him  extensive   experience  in  active   pharmaceutical
ingredient and materials  characterization,  and drug  validation and discovery,
moving drug  candidates  through to FDA  approval  including  implementation  of
advanced engineering automation for medical device development and production.




                                       20
<PAGE>

         He has also received  grants from NATO, the U.S.  Department of Energy,
the United States Industry Coalition and the State of Florida. Mr. Satz has been
awarded    eight    U.S.     patents    that    include     radiopharmaceutical,
radioimmunotherapeutic and radioactive medical devices, and 6 pending patents. A
former  Adjunct  Professor  in the  Department  of  Continuing  Education of the
University of Miami, he is Chairman of the Scientific  Advisory Board at Florida
Atlantic University, Boca Raton, FL, and serves on the Advisory Board of Florida
International  University's  School of  Engineering.  He is also on the Board of
Directors of Washington D.C. based non-profit United States Industry Coalition.

COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES AND EXCHANGE ACT OF 1934

         Section  16(a) of the Exchange Act requires our directors and executive
officers,  and  persons  who own  more  than  10% of a  registered  class of the
Company's equity  securities,  to file with the SEC initial reports of ownership
and reports of changes in ownership of common stock and other equity  securities
of the  Company.  Officers,  directors  and greater  than 10%  stockholders  are
required by SEC  regulations  to furnish the Company  with copies of all Section
16(a) forms they file. Based solely upon a review of Forms 3, 4 and 5 filed with
the SEC,  and  except for the  filings  listed in the table  below,  none of the
officers,  directors  or  greater  than 10%  stockholders  of the  company  were
delinquent in any necessary filings under Section 16(a).

NAME                   FORM    DATE OF EVENT                EXPLANATION
----                   ----    -------------                -----------

Raymond J. Romano      4       January 05, 2004     Filed late on July 08, 2004
John J. Signorelli     3       April 27, 1987       Filed late on April 14, 2004
Stanley Satz           4       January 05, 2004     Filed late on June 15, 2004


AUDIT COMMITTEE AND AUDIT COMMITTEE FINANCIAL EXPERT

         Our  board of  directors  has an audit  committee,  but does not have a
nominating  committee or  compensation  committee or any  committees  performing
similar  functions.  Our plenary board presently  performs similar  functions as
those  commonly  understood  to be within the  purview  and  competence  of such
committees  generally.  Our audit  committee is comprised of Raymond  Romano and
John  Signorelli.  In the future,  the board of  directors  intends to establish
compensation  and  nominating  committees  and to  adopt  such  other  corporate
governance measurers and policies as it believes are appropriate or necessary.

         Although  we do not  currently  have a formal  process  or  policy  for
stockholders  or others to send  communications  to the board of  directors,  we
believe  that the  establishment  of a formal  process or policy is an important
corporate  governance  step and we intend to implement such a process as soon as
practicable.  Presently,  the board of directors  welcomes  communications  from
stockholders,  employees,  and others, whether on a confidential,  anonymous, or
disclosed basis.

NOMINATING COMMITTEE

         We currently do not have any policy with regard to our consideration of
any nominees or candidates for membership on our board of directors  recommended
by our security holders. We believe that the



                                       21
<PAGE>

establishment  of such a policy is within the purview of a nominating  committee
and would be included in a charter for such committee  when and if  established.
Similarly,  we do not have  any  specific  qualifications  for  membership  on a
nominating  committee or for a nominee or candidate for  membership on our board
of  directors  at this  time,  although  we expect  that any  future  nominating
committee  may  implement  such  policies,  and it is for this  reason  that the
Company  does not know  whether  there will be any  difference  in the manner in
which the  nominating  committee  will  evaluate  nominees or candidates to be a
director  based on whether the nominee is  recommended  by a security  holder or
otherwise.  Currently,  we do not pay a fee to any third  party to  identify  or
evaluate or assist in identifying or evaluating  potential nominees to the board
of  directors.  To the best of our  knowledge,  the Company has not received any
requests from any security holder recommending any nominees or candidates to its
board of directors.

CODE OF ETHICS

         We  have  adopted  a code  of  ethics  that  applies  to our  principal
executive officer,  principal financial officer, principal accounting officer or
controller, or persons performing similar functions. Our code of ethics is being
filed with the SEC as an exhibit to this Form  10-KSB.  A copy of the  Company's
code of ethics may also be obtained by any person,  without charge, by sending a
written request addressed to: CyGene Laboratories,  Inc., 7786 Wiles Road, Coral
Springs, Florida 33067.

ITEM 10. EXECUTIVE COMPENSATION

         The following table provides  summary  information for each of the last
three fiscal years about all plan and non-plan  compensation  awarded to, earned
by, or paid to certain  persons who served as our executive  officers during the
most recent  fiscal year ended March 31, 2004,  or who earned more than $100,000
in salary and bonus.
<TABLE>
<CAPTION>

                                                      SUMMARY COMPENSATION TABLE


                                       Annual Compensation                               Long-Term Compensation
                             ----------------------------------- -----------------------------------------------------------------
    Name and                                                      Restricted      Securities
    Principal       Fiscal                                          Stock         Underlying         LTIP         All Other
    Position         Year        Salary        Bonus     Other      Awards        Options/SARs      Payouts       Compensation
------------------ --------- --------------- ---------- -------- -------------- ------------------ ----------- -------------------

<S>                  <C>      <C>            <C>        <C>      <C>                   <C>         <C>          <C>
Martin Munzer,       2004     $250,000(1)                                              $-
President and CEO    2003     $250,000(2)                                               -
                     2002     $250,000(2)                                               -

Raymond J. Romano    2004     $ 17,870(3)                              -
(Former CEO and      2003     $     0                               40,000
CFO)                                                               shares of
                                                                    common
                                                                   stock(4)

                     2002     $     0                               280,000
                                                                   shares of
                                                                    common
                                                                   stock(5)
</TABLE>


                                       22
<PAGE>

1.       Mr. Munzer received no cash  compensation  for fiscal 2002 through July
         1, 2003.  All  accrued  salary was  converted  to equity as  previously
         described under Note 11- Related Party  Transactions.  From that period
         forward  to the end of the  fiscal  year  March  31,  2004  Mr.  Munzer
         received $81,000, allowing the balance to accrue.
2.       Compensation  for these  periods was either  forgiven to the company or
         converted  into equity as  described  above.  For  financial  statement
         purposes,  the conversion of said accrued  compensation of $374,850 has
         been expensed at a cost of $0.15 per share, while the actual conversion
         of salary  accrual was  calculated at $0.0714.  This price per share is
         slightly  higher  than  the  issuances  to  other  directors,  and  for
         convertible  promissory  notes that were issued to other  employees and
         investors at the time.
3.       Represents  common  stock issued to Mr.  Romano in lieu of salary.  See
         Item 12 "Certain Relationships and Related Transactions".
4.       Represents  common  stock  issued  to Mr.  Romano as  compensation  for
         services. See Item 12 "Certain Relationships and Related Transactions".
5.       Represents  common  stock  issued  to Mr.  Romano as  compensation  for
         services.

OPTION GRANTS IN CURRENT FISCAL YEAR

         The following table sets forth information regarding the grant of stock
options to the named  executive  officers during the fiscal year ended March 31,
2004.
<TABLE>
<CAPTION>

                                                  OPTIONS/GRANTS IN LAST FISCAL YEAR

                                                                Percent of Total
                                   Number of Securities           Options/SARS
                                  Underlying Options/SARS     Granted to Employees    Exercise or Base Price
             Name                       Granted (#)              In Fiscal Year               ($/Sh)           Expiration Date
------------------------------- ---------------------------- ------------------------ ----------------------- ------------------

<S>                                       <C>                 <C>                             <C>                   <C>
Martin Munzer                             750,000                                             $0.25                 9/30/08
                                             -
                                             -
</TABLE>

DIRECTOR COMPENSATION

         On January 5, 2004, we adopted the Amended and Restated 2004 Stock Plan
(the "Amended  Plan") which  provides for automatic  grants of 100,000 shares of
common stock to directors who are not employees or 10% stockholders.  The grants
occur upon  adoption of the Amended Plan and upon election or  appointment  once
all prior grants of  restricted  stock have  vested.  Upon  adoption,  we issued
100,000 shares of restricted common stock to each of Raymond J. Romano,  Stanley
Satz and John J. Signorelli.

         For each of these grants,  20,000 of such shares vested upon  issuance,
with the  remaining  80,000  shares  vesting  in  increments  of  20,000 on each
December 31  thereafter  until fully  vested,  subject to  continued  service as
directors.




                                       23
<PAGE>

         In addition,  on January 5, 2004, in recognition of Messrs.  Romano and
Signorelli's efforts in business development for the Company, we granted each of
them, as compensation for such services,  100,000 stock options with an exercise
price of $0.25 per share,  exercisable  for a period of five years.  These stock
options were fully vested upon the granting thereof.

EXECUTIVE EMPLOYMENT AGREEMENTS AND TERMINATION/CHANGE-IN-CONTROL ARRANGEMENTS

         CyGene has a seven year  employment  agreement with Martin Munzer which
was entered into on April 13, 1999. The agreement  provides for a base salary of
$250,000 per year. Mr. Munzer has been  negotiating a new agreement with us, but
our Board of Directors has been unable to reach any agreement with him.

EMPLOYMENT AGREEMENT  (W. WITOSHKIN)

         On June 1st, 2004 CyGene entered into a three year employment  contract
with  Walter   Witoshkin  for  the  position  of  Vice  President  of  Strategic
Development. The compensation package includes an initial salary of $120,000 per
annum rising to $240,000 per annum once the company  raises at least  $5,000,000
of capital  through  the  issuance  or sale of  securities,  loans  from  banks,
financial  institutions or other lenders or a combination thereof. The executive
is also  entitled to  performance  bonuses of stock options if certain sales and
expense control targets are met. The executive was granted 750,000 stock options
of which half are fully vested and the balance is vested in increments of 62,500
options  bi-annually on each June and December commencing on December 31st, 2004
over the term of this agreement so long as the Executive remains employed by the
company on the  applicable  vesting  dates.  The exercise  price for the 750,000
stock options is the closing price as of the  effective  date of the  agreement.
The executive was also granted normal company  benefits for vacation,  insurance
and any standard  employee benefits the company offers.  Standard  provision for
termination,  non-competitive and non-disclosure of confidential information are
part of the agreement.

W. WITOSHKIN:  BACKGROUND

         Walter Witoshkin has held various management and executive positions in
the healthcare and pharmaceutical industry. These have included senior financial
positions at Wyeth Labs (American Cyanimade) and VP Business Development and CFO
positions  at  SmithKline  Beecham  (now  Glaxo  SmithKline)  and Menley & James
Laboratories, Inc. Over the past twelve years he has been a principle partner at
Trident Group, LLC, a consultancy to the healthcare and pharmaceutical industry.
At  Trident  he  has  been  responsible  for  development  of  strategic  plans,
acquisition   searches  of  companies,   products  and  technologies  for  major
pharmaceutical clients as well as smaller companies and start-ups.

CONSULTING AGREEMENTS

         On January 1, 2004,  CyGene,  Inc.  entered into a two-year  Consulting
Agreement  with Dr.  Fred  McCall-Perez  (terminable  earlier  on three  months'
notice), whereby Dr. McCall-Perez agreed to act as CyGene, Inc.'s Vice President
of  Knowledge  Base & Genetic  Counseling  Services  and to  provide  consulting
services to CyGene, Inc., including consulting services related to knowledgebase
development and genetic counseling services,  and the preparation of a web-based
interface  for client  retrieval of  laboratory  results.  Under the  Consulting
Agreement,   CyGene,  Inc.  agreed  to  compensate  Dr.  McCall-Perez  for  such
consulting  services at the rate of $10,000 per month,  and  CyGene,  Inc.  also
agreed  to  reimburse  him  for  certain  pre-authorized  expenses  incurred  in
connection with such consulting services.



                                       24
<PAGE>

         On January 19, 2004  (effective as of November 1, 2003),  CyGene,  Inc.
entered  into a  two-year  Consulting  Agreement  with Dr.  Barry  Dvorchik  and
Associates  Inc.  ("BSA"),  whereby  BSA  agreed to act as CyGene,  Inc.'s  Vice
President of Drug Development and to provide consulting services to CyGene, Inc.
Under the Consulting  Agreement,  CyGene,  Inc. agreed to compensate BSA for its
consulting  services at the rate of $200 per hour for services  rendered  during
the period November 1, 2003 through December 31, 2003; and commencing on January
1, 2004, at the rate of $160 per hour,  based on an estimated  100-125 hours per
month.  CyGene,  Inc.  also agreed to reimburse  BSA for certain  pre-authorized
expenses  incurred in connection with such consulting  services.  The Consulting
Agreement  provided for the issuance of 400,000  warrants with an exercise price
of $0.225 per share,  with  50,000  warrants  vest  every  three  months for the
duration of the term of the warrant. The warrants expire on December 31, 2010.

ITEM 11.  SECURITY  OWNERSHIP OF CERTAIN  BENEFICIAL  OWNERS AND  MANAGEMENT AND
RELATED STOCKHOLDER MATTERS

         The  following  table sets  forth,  as of  September  7, 2004,  certain
information with respect to the Company's  equity  securities owned of record or
beneficially  by (i) each  executive  officer and director of the Company;  (ii)
each person who owns  beneficially  more than 5% of each class of the  Company's
outstanding equity securities; and (iii) all directors and executive officers as
a group.

<TABLE>
<CAPTION>

                                                                           AMOUNT AND NATURE
                                       NAME AND ADDRESS                      OF BENEFICIAL            PERCENT
    TITLE OF CLASS                  OF BENEFICIAL OWNER (1)                    OWNERSHIP             OF CLASS (1)
    --------------                  -----------------------                    ---------             ------------

<S>                     <C>                                                           <C>                  <C>
Common Stock            Martin Munzer                                              8,651,109(2)         19.99%
                        7786 Wiles Road
                        Coral Springs, FL 33067
Common Stock            Raymond J. Romano                                          1,179,285(3)          2.72%
                        2 Daniel Road
                        Fairfield, NJ 07004
Common Stock            John Signorelli                                              702,433(4)          1.62%
                        P.O. Box 386
                        Goldens Bridge, NY 10526
Common Stock            Stanley Satz                                                 100,000             *
                        9372 Harding Avenue
                        Surfside, FL 07004
Common Stock            Walter W. Witoshkin                                          750,000(5)          *
                        321 Norristown Road, Suite 320
                        Amble, PA 19002
Common Stock            Elliot Ramberg                                             4,279,864(6)          9.89%


All executive                                                                                           24.33%
officers and
directors as a group
</TABLE>




                                       25
<PAGE>

(1)      Beneficial  ownership has been determined in accordance with Rule 13d-3
         under the Exchange Act and unless otherwise  indicated,  and represents
         securities  for which the beneficial  owner has sole voting  investment
         power or has the power to acquire such beneficial  ownership  within 60
         days.
(2)      These  shares  are  held Mr.  Munzer  and his  wife as  tenants  by the
         entireties.  It includes  750,000 shares  issuable upon the exercise of
         stock options.
(3)      This  includes  100,000  shares  issuable  upon the  exercise  of stock
         options.  177,777 of these shares are held by RKL Partner for which Mr.
         Romano  controls  50%  and  88,888  of  these  shares  are  held by M&R
         Associates for which Mr. Romano controls 50%.
(4)      This  includes  100,000  shares  issuable  upon the  exercise  of stock
         options. It includes 74,300 shares which are held by Mr. Signorelli and
         his wife jointly, and 379,200 shares held by Mr. Signorelli's wife.
(5)      This  represents  750,000  shares  issuable  upon the exercise of stock
         options  which  are held by Windy  Bush  Trading  Co.  LLC of which Mr.
         Witoshkin is the controlling member.
(6)      Includes  1,721,349  shares of  common  stock  owned by his wife  Carol
         Ramberg, of which he is presumed to be the beneficial owner and 400,000
         shares  issuable upon the exercise of stock options.  We are relying on
         our stock transfer records and information  supplied by Mr. Ramberg. We
         do not know if Mr.  or Mrs.  Ramberg  beneficially  own any  additional
         shares since they have not filed a Schedule  13D or 13G  although  they
         are required to do so.

* Less than 1%

SECURITIES AUTHORIZED FOR ISSUANCE UNDER EQUITY COMPENSATION PLANS
<TABLE>
<CAPTION>

                                 EQUITY COMPENSATION PLAN INFORMATION
                                                                                NUMBER OF SECURITIES
                                                                               REMAINING AVAILABLE FOR
                                                                                FUTURE ISSUANCE UNDER
                            NUMBER OF SECURITIES TO      WEIGHTED-AVERAGE        EQUITY COMPENSATION
                            BE ISSUED UPON EXERCISE     EXERCISE PRICE OF         PLANS (EXCLUDING
                            OF OUTSTANDING OPTIONS,    OUTSTANDING OPTIONS,    SECURITIES REFLECTED IN
                              WARRANTS AND RIGHTS      WARRANTS AND RIGHTS           COLUMN (A))
      PLAN CATEGORY                   (A)                      (B)                       (C)
<S>                        <C>                         <C>                     <C>
Equity compensation plans
approved by security
holders                           2,000,000(1)                                        1,500,000
Equity compensation plans
not approved by security
holders                             600,000                                            900,000
          TOTAL
</TABLE>

1.       The above amount does not include the issuance of 750,000 stock options
         to Mr. Walter Witoshkin on June 1, 2004




                                       26
<PAGE>

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

         In July  2004,  we  borrowed  $50,000  to use as a deposit  for our new
facilty.  The lender was  Transpirator  LLC, an entity that  received all of our
assets which existed as of September  29, 2004 and is managed by Mr,  Raymond J.
Romano,  one of our  directors.  The loan with 6% per annum  interest is payable
from  the  receipt  of  our  proposed  bridge  loan  financing.   As  additional
consideration,  we agreed to issue  Transpirator  LLC a warrant to  purchase  to
purchase  50,000  shares of our  common  stock at $.40 per share over a two year
period.

         On February 23, 2004 Mr. Romano  purchased  $10,000 of our common stock
at $.225 per share and on January 9, 2004 Mr.  Romano  purchased  $10,000 of our
common  stock at $.225 per share.  The shares were issued to M&R  Associates,  a
partnership  in which Mr. Romano  controls 50%.  These shares were  purchased as
part of a private placement of our securities.

         Prior to the merger with CyGene,  Inc., we conducted our  operations at
office facilities provided free of charge by Mr. Romano.

         On September 25, 2003 Mr. Romano purchased  $10,000 of our common stock
at $.225 per share.  The shares were issued to RKL Associates,  a partnership in
which Mr. Romano  controls 50%. These shares were purchased as part of a private
placement of the Companies securities.

         On  September  12,  2003 Mr.  Romano and Mr. John J.  Signorelli,  both
directors  of the  Company  purchased  $20,000  and $5,000 of our common  stock,
respectively, at $0.15 per share.

         Prior to the merger with  CyGene,  Inc.,  Messrs.  Romano  (through RKL
Associates) and Signorelli  purchased 133,333 and 33,333 shares of CyGene,  Inc.
common stock at $.15 per share.

         On July 2, 2003 the  Board of  Directors  authorized  the  issuance  of
47,025 shares each to Messrs. Romano Signorelli as compensation for the time and
effort spent of the merger with Cygene, Inc. in lieu of the $50.00 per hour that
otherwise  would be due. The  approximate  value of the shares was $17,870 based
upon the closing price on July 2, 2003 of $.19 per share.

         On December 12, 2002 the Board of Directors  authorized the issuance of
80,000  restricted  common  shares  to  our  three  officers  and  directors  as
compensation for their efforts in securing the re-listing of common stock on the
OTC Bulletin Board. The approximate value of the shares at the time of issue was
$2,800 or 0.035 per  share.  The  shares  were  issued as  follows:  Mr.  Romano
received 40,000 shares and Mr.  Signorelli and Mr. Porcella each received 20,000
shares.

ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES.

AUDIT FEES

         The aggregate  fees billed for  professional  services  rendered by our
principal  independent  accountants  for  the  audits  of our  annual  financial
statements to be included in our Form 10-KSB/A for the year ended March 31, 2004
were  $130,000  (including  fees for  audits  of the  cumulative  statements  of
operations  from  October 25, 1995  (inception)  through  March 31, 2001 and the
statements of changes in stockholders'  equity from October 25,1995  (inception)
through March 31,  2001____________ as compared to $_________ for the year ended
March 31, 2003. Eisner LLP was our independent accountant for fiscal



                                       27
<PAGE>

2004 while Brimmer, Burek & Keelan LLP was our independent accountant for fiscal
2003.  Brimmer,  Burek & Keelan  LLP  billed  us  $________________  in fees for
reviews of our  financial  statements  contained in Form 10-QSB  during 2004 and
$____________for such services in 2003.

AUDIT-RELATED FEES

         We incurred  $_______ and  $_________  in audit related fees during the
fiscal years ended March 31, 2004 and 2003, respectively.


ALL OTHER FEES

         Our  principal  independent  accountants  did  not  perform  any  other
services for us during the fiscal years ended March 31, 2004 or 2003.

         We  have  not  adopted  audit  committee   pre-approval   policies  and
procedures.




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<PAGE>

                                   SIGNATURES

         Pursuant to the  requirements  of Section 13 or 15(d) of the Securities
Exchange  Act of 1934,  the  registrant  caused  this report to be signed on its
behalf by the undersigned,  thereunto duly authorized this 16th day of September
2004.


                                    CYGENE LABORATORIES, INC.


                                    By: /s/ Martin Munzer
                                        --------------------------------------
                                        Martin Munzer, Chief Executive Officer

         In accordance with the Securities Exchange Act of 1934, this report has
been signed below by the following  persons on behalf of the  registrant  and in
the capacities and on the dates indicated.
<TABLE>
<CAPTION>

SIGNATURES                               TITLE                                          DATE
----------                               -----                                          ----
<S>                                      <C>                                            <C>


/s/ Martin Munzer                        Chairman of the Board of Directors Chief
----------------------                   Executive Officer, and Chief Financial
Martin Munzer                            Officer                                        September 16, 2004


                                         Director                                       September __, 2004
----------------------
Raymond J. Romano

/s/ John Signorelli                      Director                                       September 17, 2004
----------------------
John Signorelli

/s/ John Signorelli                      Director                                       September 17, 2004
----------------------
John Signorelli


/s/ Stanley Satz                         Director                                       September 16, 2004
----------------------
Stanley Satz

</TABLE>

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