Acrongenomics (AGNM) 10-Q 2010 Q2 Quarterly report

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

FORM 10-Q

(Mark One)

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended:June 30, 2010

or

[   ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from _____to _____

Commission File Number:000-49833

ACRONGENOMICS INC.
(Exact name of registrant as specified in its charter)

Nevada	52-2219285
(State or other jurisdiction of	(IRS Employer
incorporation or organization)	Identification No.)

Fairfax House, 15 Fulwood Place, London UK WC1V 6AY
(Address of principal executive offices) (Zip Code)

30 697 724 3620
(Registrant’s telephone number, including area code)

Not Applicable
(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Yes [X]    No [   ]

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§229.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files)
Yes [   ]    No [   ] (Not currently applicable to the registrant)

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer [   ]		Accelerated filer                  [   ]
Non-accelerated filer   [   ]	(Do not check if a smaller reporting company)	Smaller reporting company [X]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes [   ]    No [X]

APPLICABLE ONLY TO CORPORATE ISSUERS

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date

26,965,481 shares of common stock outstanding as of August 20, 2010.

TABLE OF CONTENTS

PART I - FINANCIAL INFORMATION	1
Item 1. Financial Statements	1
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.	3
Item 3. Quantitative and Qualitative Disclosures About Market Risks.	9
Item 4. Controls and Procedures	9
PART II - OTHER INFORMATION	11
Item 1. Legal Proceedings.	11
Item 1A. Risk Factors	11
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	16
Item 3. Defaults Upon Senior Securities.	16
Item 4. (Removed and Reserved).	16
Item 5. Other Information	16
Item 6. Exhibits.	16
SIGNATURES	18

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements.

It is the opinion of management that the interim financial statements for the six months ended June 30, 2010 include all adjustments that are necessary in order to make the interim financial statements not misleading.

Our interim financial statements are stated in United States dollars and are prepared in accordance with United States generally accepted accounting principles.

1

ACRONGENOMICS, INC.

(A Development Stage Company)

INTERIM FINANCIAL STATEMENTS

June 30, 2010

(Stated in US Dollars)

(unaudited)

2

ACRONGENOMICS, INC.
(A Development Stage Company)
INTERIM BALANCE SHEETS
June 30, 2010 and December 31, 2009
(Stated in US Dollars)
(Unaudited)

		June 30,			December 31,
		2010			2009
ASSETS
Current
Cash	$	495		$	4,303
Prepaid expenses and deposit		15,000			15,000
		15,495			19,303
Deposit		14,142			14,142
Investment in Molecular Vision Ltd. – Note 3		827,401			827,401
	$	857,038		$	860,846
LIABILITIES
Current
Accounts payable and accrued liabilities – Note 7	$	925,783		$	721,149
Convertible promissory notes payable – Note 5		651,462			658,522
Loans payable– Note 6		58,353			1,000
		1,635,598			1,380,671
CAPITAL DEFICIT
Common stock – Note 8
Par value $0.001
100,000,000 shares authorized            25,780,481 shares issued (2009: 25,580,481)		25,780			25,580
Additional paid-in capital		27,070,464			27,024,990
Deficit accumulated during the development stage		(27,874,804	)		(27,570,395	)
		(778,560	)		(519,825	)
	$	857,038		$	860,846

SEE ACCOMPANYING NOTES

ACRONGENOMICS, INC.
(A Development Stage Company)
INTERIM STATEMENTS OF OPERATIONS
for the Three and Six months ended June 30, 2010 and 2009 and
for the period August 17, 1999 (Date of Inception) to June 30, 2010
(Stated in US Dollars)
(Unaudited)

														August 17, 1999
														( Date of
														Inception ) to
		For the three months ended						For the six months ended						June 30,
		June 30,						June 30,						2010
		2010			2009			2010			2009			cumulative
Expenses
Accounting and audit fees – Note 7	$	67,409		$	59,403		$	116,374		$	94,182		$	843,456
Amortization of patents		-			-			-			-			741,430
Appraisals		-			-			-			-			14,500
Bank charges		461			481			763			934			19,478
Consulting fees – Note 7		64,500			72,911			129,674			184,654			3,038,179
Legal fees - Note 7		2,803			31,872			2,803			42,438			431,373
Management fees – Note 7		-			-			-			11,647			3,326,506
Office and miscellaneous		486			738			1,151			2,211			140,963
Public relations and donation		-			-			-			7,600			587,096
Rent - Note 7		15,455			15,278			30,743			30,557			200,173
Research and development – Note 7		-			-			-			-			9,202,266
Transfer agent and filing fees		2,580			2,399			2,580			4,291			42,323
Travel		-			2,624			-			4,496			456,587
Write-down of patents		-			-			-			-			8,004,447
Operating loss		(153,694	)		(185,706	)		(284,088	)		(383,010	)		(27,048,777	)
Interest income		-			1			-			9			23,150
Interest and accretion on notes       payable – Notes 5 and 7		(15,058	)		(9,934	)		(29,746	)		(15,723	)		(657,375	)
Write-down of investment in       Molecular Vision – Note 3		-			-			-			-			(239,330	)
Change in fair value of derivative liability		85,163			(34,211	)		-			(42,251	)		169,452
Foreign exchange gain (loss)		29,160			(2,487	)		9,425			(2,644	)		(79,926	)
Loss from continuing operations		(54,429	)		(232,337	)		(304,409	)		(443,619	)		(27,832,806	)
Loss from discontinued operations		-			-			-			-			(41,998	)
Net loss for the period	$	(54,429	)	$	(232,337	)	$	(304,409	)	$	(443,619	)	$	(27,874,804	)
Basic and diluted loss per share	$	(0.00	)	$	(0.01	)	$	(0.01	)	$	(0.02	)
Weighted average shares outstanding		25,690,203			24,863,366			25,635,343			24,728,324

SEE ACCOMPANYING NOTES

ACRONGENOMICS, INC.
(A Development Stage Company)
INTERIM STATEMENTS OF CASH FLOWS
for the six months ended June 30, 2010 and 2009 and
for the period August 17, 1999 (Date of Inception) to June 30, 2010
(Stated in US Dollars)
(Unaudited)

								August 17,
								1999(Date of
		For the Six months Ended						Inception) to
		June 30,						June 30,
		2010			2009			2010
Cash Flows used in Operating Activities
Net loss for the period	$	(304,409	)	$	(443,619	)	$	(27,874,804	)
Adjustments to reconcile net income to net cash provided       by operating activities:
Amortization of patents		-			-			741,430
Financing fee on convertible promissory note		-			-			7,500
Write-down of investment in Molecular Vision		-						239,330
Change in fair value of derivative liability		-			42,251			(169,452	)
Accretion of debt discount		-			-			538,262
Unrealized foreign exchange (gain) loss		(9,425	)		-			88,716
Shares issued for consulting and management fees		-			-			1,312,500
Loan origination fee – Note 5		-			-			16,245
Stock-based compensation		674			28,086			1,904,389
Write-down of patents		-			-			8,004,447
Changes in non-cash working capital items:
Prepaid expenses and deposit		-			2,432			(15,000	)
Accounts payable and accrued liabilities		204,634			(28,229	)		2,759,398
Net cash used in operating activities		(108,526	)		(399,079	)		(12,447,039	)
Cash Flows used in Investing Activity
Investment in Molecular Vision		-			-			(1,373,140	)
Refund on termination of development agreement with
Molecular Vision		-			-			149,794
Deposit		-			(14,142	)		(14,142	)
Patents		-			-			(121,877	)
Net cash used in investing activities		-			(14,142	)		(1,359,365	)
Cash Flows provided by Financing Activities
Common stock issued for cash		45,000			419,000			12,809,438
Stock purchase warrants		-			-			370,307
Common stock subscriptions		-			-			29,800
Issuance of convertible notes		-			-			836,636
Repayment of convertible note		-			-			(300,000	)
Loans payable		59,718			-			60,718
Net cash provided by financing activities		104,718			419,000			13,806,899
Increase (decrease) in cash during the period		(3,808	)		5,779			495
Cash, beginning of period		4,303			22,044			-
Cash, end of period	$	495		$	27,823		$	495
Supplemental cash flow information:
Cash paid for interest	$	-		$	-
Cash paid for taxes	$	-		$	-

SEE ACCOMPANYING NOTES

ACRONGENOMICS, INC.
(A Development Stage Company)
INTERIM STATEMENT OF CHANGES IN CAPITAL DEFICIT
for the period August 17, 1999 (Date of Inception) to June 30, 2010
(Stated in US Dollars )
(Unaudited)

											Deficit
		Common Stock									Accumulated
						Additional			Share		During the
						Paid-in			Subscriptions		Development
		Shares		Par Value		Capital			(Receivable)		Stage			Total
Capital stock issued for cash	at $0.001	5,000,000	$	5,000	$	-		$	-	$	-		$	5,000
	at $0.01	5,000,000		5,000		45,000			-					50,000
Net loss for the period		-		-		-			-		(2,116	)		(2,116	)
Balance, December 31, 1999		10,000,000		10,000		45,000			-		(2,116	)		52,884
Capital stock issued for cash	at $0.20	100,000		100		19,900			-		-			20,000
Net loss for the year		-		-		-			-		(8,176	)		(8,176	)
Balance, December 31, 2000		10,100,000		10,100		64,900			-		(10,292	)		64,708
Net loss for the year		-		-		-			-		(205	)		(205	)
Balance, December 31, 2001		10,100,000		10,100		64,900			-		(10,497	)		64,503
Capital stock issued for cash	at $0.20	15,000		15		2,985			-		-			3,000
Net loss for the year		-		-		-			-		(24,818	)		(24,818	)
Balance, December 31, 2002		10,115,000		10,115		67,885			-		(35,315	)		42,685
Net loss for the year		-		-		-			-		(21,576	)		(21,576	)
Balance, December 31, 2003		10,115,000		10,115		67,885			-		(56,891	)		21,109
Pursuant to the acquisition of patent	at $1.96	4,000,000		4,000		7,836,000			-		-			7,840,000
Capital stock issued for patent commission	at $1.96	400,000		400		783,600			-		-			784,000
Capital stock issued for cash	at $1.00	420,000		420		419,580			-		-			420,000
Capital stock issued for commission	at $1.00	42,000		42		41,958			-		-			42,000
Less: commission		-		-		(77,000	)		-		-			(77,000	)
Capital stock issued for cash	at $2.30	537,956		538		1,236,761			-		-			1,237,299
Capital stock issued for commission		50,594		50		116,316			-		-			116,366
Less: commission		-		-		(116,366	)		-		-			(116,366	)
Capital contribution		-		-		6,000			-		-			6,000
Stock subscriptions		-		-		-			426,329		-			426,329
Net loss for the year		-		-		-			-		(1,863,376	)		(1,863,376	)
Balance, December 31, 2004		15,565,550	$	15,565	$	10,314,734		$	426,329	$	(1,920,267	)	$	8,836,361

SEE ACCOMPANYING NOTES

ACRONGENOMICS, INC.
(A Development Stage Company)
INTERIM STATEMENT OF CHANGES IN CAPITAL DEFICIT
for the period August 17, 1999 (Date of Inception) to June 30, 2010
(Stated in US Dollars )
(Unaudited)

														Deficit
		Common Stock												Accumulated
								Additional			Share			During the
								Paid-in			Subscriptions			Development
		Shares			Par Value			Capital			(Receivable)			Stage			Total
Balance, December 31, 2004		15,565,550		$	15,565		$	10,314,734		$	426,329		$	(1,920,267	)	$	8,836,361
Capital stock issued for cash	at $2.30	72,500			73			166,677			-			-			166,750
	at $2.40	108,168			108			259,495			-			-			259,603
	at $3.50	551,443			551			1,929,499			-			-			1,930,050
	at $4.00	915,125			915			3,659,585			(386,329	)		-			3,274,171
Capital stock issued for commission	at $4.00	81,337			82			325,266			-			-			325,348
Less: commission		-			-			(325,348	)		-			-			(325,348	)
commission		-			-			(24,900	)		-			-			(24,900	)
Capital stock issued for cash pursuant to exercise of warrants	at $1.00	420,000			420			419,580			-			-			420,000
Stock-based compensation		-			-			364,000			-			-			364,000
Capital stock issued for consulting services	at $4.68	100,000			100			467,900			-			-			468,000
Net loss from continuing operations		-			-			-			-			(14,152,210	)		(14,152,210	)
Net loss from discontinued operations														(1,935	)		(1,935	)
Capital contribution from subsidiary on disposition		-			-			(6,000	)		-			-			(6,000	)
Balance, December 31, 2005		17,814,123			17,814			17,550,488			40,000			(16,074,412	)		1,533,890
Cancellation of shares		(4,000,000	)		(4,000	)		4,000			-			-			-
Stock-based compensation		-			-			529,673			-			-			529,673
Capital stock issued for cash	at $0.75	317,334			317			237,683			-			-			238,000
Less: share issue costs		-			-			(6,300	)		-			-			(6,300	)
Net loss for the year		-			-			-			-			(2,480,288	)		(2,480,288	)
Balance, December 31, 2006		14,131,457			14,131			18,315,544			40,000			(18,554,700	)		(185,025	)
Capital stock issued for cash:	at $0.50	220,000			220			109,780			(40,000	)		-			70,000
	at $0.80	250,000			250			199,750			-			-			200,000
	at $1.10	2,230,924			2,231			2,451,785			(3,300	)		-			2,450,716
Capital stock issued for commission		126,090			126			(126	)		-			-			-
Less: commission - cash		-			-			(64,021	)		-			-			(64,021	)
Stock as bonus	at $0.86	750,000			750			644,250			-			-			645,000
Stock issued to settle accounts payable	at $1.00	158,000			158			157,842			-			-			158,000
Stock-based compensation		-			-			533,252			-			-			533,252
Net loss for the year		-			-			-			-			(5,056,117	)		(5,056,117	)
Balance, December 31, 2007		17,866,471		$	17,866		$	22,348,056		$	(3,300	)	$	(23,610,817	)	$	(1,248,195	)

SEE ACCOMPANYING NOTES

ACRONGENOMICS, INC.
(A Development Stage Company)
INTERIM STATEMENT OF CHANGES IN CAPITAL DEFICIT
for the period August 17, 1999 (Date of Inception) to June 30, 2010
(Stated in US Dollars )
(Unaudited)

												Deficit
		Common Stock										Accumulated
						Additional			Share			During the
						Paid-in			Subscriptions			Development
		Shares		Par Value		Capital			(Receivable)			Stage			Total
Balance, December 31, 2007		17,866,471	$	17,866	$	22,348,056		$	(3,300	)	$	(23,610,817	)	$	(1,248,195	)
Stock Subscriptions		-		-		-			29,800			-			29,800
Capital stock issued for cash:	- at $0.80	1,250,010		1,250		998,758			-			-			1,000,008
	- at $1.10	90,000		90		98,910			-			-			99,000
	- at $0.40	1,450,250		1,450		578,650			-			-			580,100
Capital stock issued for consulting
and management fees	- at $0.95	150,000		150		142,350			-			-			142,500
	- at $0.53	150,000		150		79,350			-			-			79,500
	- at $0.27	1,650,000		1,650		443,850			-			-			445,500
Less: commission - cash		-		-		(169,460	)		-			-			(169,460	)
Capital stock issued to settle accounts
payable:	- at $0.95	150,000		150		142,350			-			-			142,500
	- at $0.79	1,150,000		1,150		907,350			-			-			908,500
Beneficial conversion feature on convertible notes		-		-		482,124			-			-			482,124
Stock-based compensation		-		-		454,919			-			-			454,919
Net loss for the year		-		-		-			-			(3,022,005	)		(3,022,005	)
Balance, December 31, 2008		23,906,731		23,906		26,507,207			26,500			(26,632,822	)		(75,209	)
Capital stock issued for cash	- at $0.40	1,673,750		1,674		667,826			(26,500	)		-			643,000
Less: commission		-		-		(58,600	)		-			-			(58,600	)
Reclassification of derivative liability						(113,314	)								(113,314	)
Stock-based compensation		-		-		21,871			-			-			21,871
Net loss for the year		-		-		-			-			(937,573	)		(937,573	)
Balance, December 31,2009		25,580,481		25,580		27,024,990			-			(27,570,395	)		(519,825	)
Capital stock issued for cash:	- at $0.40	25,000		25		9,975			-			-			10,000
	- at $0.20	175,000		175		34,825			-			-			35,000
Stock-based compensation		-		-		674			-			-			674
Net loss for the period		-		-		-			-			(304,409	)		(304,409	)
Balance, June 30, 2010		25,780,481	$	25,780	$	27,070,464		$	-		$	(27,874,804	)	$	(778,560	)

SEE ACCOMPANYING NOTES

ACRONGENOMICS, INC.
(A Development Stage Company)
NOTES TO THE FINANCIAL STATEMENTS
June 30, 2010 and 2009
(Stated in US Dollars)
(Unaudited)

Note 1	Nature of Operations and Ability to Continue as a Going Concern
	The Company is in the development stage and has not yet realized any revenues from its planned operations. The Company’s business is research and development in the field of life science including BioLED technology.
	These financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America on a going concern basis, which assumes that the Company will continue to realize its assets and discharge its obligations and commitments in the normal course of operations. Realization values may be substantially different from carrying values as shown and these financial statements do not give effect to adjustments that would be necessary to the carrying values and classification of assets and liabilities should the Company be unable to continue as a going concern. At June 30, 2010, the Company had not yet achieved profitable operations, had an accumulated deficit of $27,874,804 (2009 - $27,570,395) since its inception and incurred a net loss of $304,409 for the six months then ended and expects to incur further losses in the development of its business, all of which casts substantial doubt about the Company’s ability to continue as a going concern. The Company’s ability to continue as a going concern is dependent upon its ability to generate future profitable operations and/or to obtain the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due. Management has no formal plan in place to address this concern but is considering obtaining additional funds by debt financing to the extent there is a shortfall from operations. While the Company is expending its best efforts to achieve the above plans, there is no assurance that any such activity will generate funds for operations.
	The Company was incorporated in the State of Nevada, USA on August 17, 1999 as Cellway Ventures Inc. Effective February 25, 2004, the Company changed its name to Acrongenomics, Inc.
	These unaudited interim financial statements reflect all adjustments, consisting of normal recurring adjustments, which in the opinion of management are necessary for fair presentation of the information contained therein. It is suggested that these interim financial statements be read in conjunction with the audited financial statements of the Company for the year ended December 31, 2009. The interim results are not necessarily indicative of the operating results expected for the fiscal year ending on December 31, 2010. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations, although the Company believes that the disclosures herein are adequate to make the information presented not misleading.
Note 2	Summary of Significant Accounting Policies
	Recent Accounting Pronouncements
	In October 2009, the FASB issued ASU No. 2009-13, “Multiple-Deliverable Revenue Arrangements,” or ASU 2009-13, which amends existing revenue recognition accounting pronouncements that are currently within the scope of ASC 605. This guidance eliminates the requirement to establish the fair value of undelivered products and services and instead provides for separate revenue recognition based upon management’s estimate of the selling price for an undelivered item when there is no other means to determine the fair value of that undelivered item. ASU 2009-13 is effective prospectively for revenue arrangements entered into or materially modified in fiscal years beginning on or after June 15, 2010. The Company is currently evaluating the impact, if any, that the adoption of this amendment will have on its consolidated financial statements.

Acrongenomics, Inc.
(A Development Stage Company)
Notes to the Financial Statements
June 30, 2010 and 2009
(Unaudited - Stated in US Dollars) - Page 2

Note 2 Summary of Significant Accounting Policies – (cont’d)

	Recent Accounting Pronouncements – (cont’d)
	In January 2010, the FASB issued Accounting Standards Update No. 2010-06,Improving Disclosuresabout Fair Value Measurements (Topic 820)—Fair Value Measurements and Disclosures(ASU 2010-06), to add additional disclosures about the different classes of assets and liabilities measured at fair value, the valuation techniques and inputs used, the activity in Level 3 fair value measurements, and the transfers between Levels 1, 2, and 3. The Company is currently evaluating the impact of the pending adoption of this standards update on its consolidated financial statements. The new disclosures and clarifications of existing disclosure are effective for fiscal years beginning after December 15, 2009, except for the disclosure requirements related to the purchases, sales, issuances and settlements in the roll-forward activity of Level 3 fair value measurements. Those disclosure requirements are effective for fiscal years ending after December 31, 2010. The adoption of ASU 2010-06 had no material impact on the Company’s financial statements.
	In February 2010, the FASB issued ASU 2010-09,Subsequent Events. ASU 2010-09 was issued to amend ASC 855 to remove the requirement for SEC filers to disclose the date through which an entity has evaluated subsequent events. This change is intended to alleviate potential conflicts with current SEC guidance. The provisions of ASU 2010-09 are effective upon issuance. The adoption of ASC 855 and ASU 2010-09 did not have a material impact on the Company's consolidated financial statements.
	In April 2010, the FASB issued Accounting Standards Update No. 2010-17,Revenue Recognition—Milestone Method (Topic 605)–Revenue Recognition(ASU 2010-17). ASU 2010-17 provides guidance on defining the milestone and determining when the use of the milestone method of revenue recognition for research or development transactions is appropriate. It provides criteria for evaluating if the milestone is substantive and clarifies that a vendor can recognize consideration that is contingent upon achievement of a milestone as revenue in the period in which the milestone is achieved, if the milestone meets all the criteria to be considered substantive. ASU 2010-17 is effective for the Company in fiscal 2011 and should be applied prospectively. Early adoption is permitted. The Company is currently evaluating the impact of the pending adoption of ASU 2010-17 on its consolidated financial statements.
Note 3	Investment in Molecular Vision Ltd.
	The Company’s investment in Molecular Vision Ltd. (“Molecular”) is summarized as follows:

	Number of Molecular
	shares owned		Amount
Balance - December 31, 2008	33,734	$	791,230
Acquisition of Molecular shares for GBP £166,042	19,426		275,501
Less: Write-down	-		(239,330	)
Balance as at June 30, 2010 and
December 31, 2009	53,160	$	827,401

The 53,160 shares owned in Molecular above represent 17.2% of the total issued shares of Molecular as at June 30, 2010 and December 31, 2009.

Acrongenomics, Inc.
(A Development Stage Company)
Notes to the Financial Statements
June 30, 2010 and 2009
(Unaudited - Stated in US Dollars) - Page 3

Note 4

Fair Value Measurements

ASC 820 defines fair value, establishes a framework for measuring fair value under generally accepted accounting principles and enhances disclosures about fair value measurements. Fair value is defined under ASC 820 as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value under ASC 820 must maximize the use of observable inputs and minimize the use of unobservable inputs. The standard describes a fair value hierarchy based on three levels of inputs, of which the first two are considered observable and the last unobservable, that may be used to measure fair value which are the following:

Level 1 -	quoted prices (unadjusted) in active markets for identical assets or liabilities;
Level 2 -	observable inputs other than Level I, quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, and model-derived prices whose inputs are observable or whose significant value drivers are observable; and
Level 3 -	assets and liabilities whose significant value drivers are unobservable by little or no market activity and that are significant to the fair value of the assets or liabilities.

As at June 30, 2010, the Company has determined that it does not hold any Level 1 assets and its shareholdings in Molecular Vision, which are measured on a non-recurring basis, represent Level 2 assets.

The fair value changes of the Company’s Level 2 assets are summarized as follows:

		Beginning Value						Ending Fair
		of		Shares		Impairment		Value of Level 2
		Level 2 Assets		Acquired		Charge		Assets
For the six months ended June 30, 2010	$	827,401	$	-	$	-	$	827,401

During the year ended December 31, 2009, in accordance with ASC 815-40-15, the Company determined that the conversion features associated with its convertible promissory notes required bifurcation as derivative liabilities – (Note 5). The resulting derivatives are required to be measured at their fair value each reporting period and they constitute Level 3 liabilities given that they have no active market and are measured based on information that is unobservable. A summary of the Company’s Level 3 for the six months ended June 30, 2010 and year ended December 31, 2009 is as follows:

				Derivative Liabilities
		Beginning Value		bifurcated from		Change in fair			Ending Fair Value
		of		convertible		value of derivative			of Level 3
		Level 3 Liabilities		promissory notes		liabilities			Liabilities
For the six months ended June 30, 2010	$	-	$	-	$	-		$	-
For the 12 months ended December 31, 2009	$	-	$	169,452	$	(169,452	)	$	-

Acrongenomics, Inc.
(A Development Stage Company)
Notes to the Financial Statements
June 30, 2010 and 2009
(Unaudited - Stated in US Dollars) - Page 4

Note 4	Fair Value Measurements – (cont’d)
	The Company determined for the fair value of the component of derivative liability represented by the warrants issuable on conversion of the promissory notes by using the Black Scholes model with the following assumptions:

Expected life	2 years
Expected Volatility	211.19%
Risk free interest rate	1.02% - 1.63%
Dividend Yield	0%

Note 5	Convertible Promissory Notes Payable
	$394,136 Convertible Promissory Note
	During the year ended December 31, 2008, the Company was loaned $394,136 by a director of the Company by the issuance of a convertible promissory note, payable on demand, with interest accruing on the balance of principal outstanding at 8% per annum, compounded monthly and payable monthly. The note is convertible into units of the Company at a price of $0.40 per unit. Each unit will consist of one common share and one share purchase warrant exercisable at $0.75 per share for a period of two years from the date of issuance. Upon the issuance of the note, the Company recorded a beneficial conversion feature totalling $292,124 which was accreted to income in its entirety and included in interest, fees and accretion on notes payable in the financial statements for the year ended December 31, 2008.
	Effective March 1, 2009, the Company and the lender agreed to modify the terms of the note by increasing the interest rate to 10% per annum and by changing the terms of repayment such that the Company is to repay the note in Canadian dollars at a foreign exchange rate of not less than $1US = $1.27 Canadian. As a result of the Company having to repay the note in a currency other than its functional currency, in accordance with ASC 830-35-1 “Transaction Gains and Losses”,changes in the exchange rate between the US and Canadian dollar will affect the expected amount of the payment upon the settlement of the note requiring the Company to record the change in rate as a transaction gain or loss in the Statement of Operations. For the six months ended June 30, 2010, the Company recorded a foreign exchange gain of $5,037 (2009: $Nil) on the note resulting in a balance payable as at June 30, 2010 of $471, 956.
	Additionally, the conversion feature of this note failed the two-step evaluation criteria contained in ASC 815-40 and, as a result, it was determined that it was required to be bifurcated from the host contract and recorded as a derivative liability. In accordance with ASC 815, the Company is required to re-measure the fair value of the derivative at each reporting period with the change in fair value recorded as a gain or loss in the Statement of Operations. At June 30, 2010, the Company re-measured the fair value of the derivative liability and determined it had a fair value of $nil.
	During the six months ended June 30, 2010, the Company accrued interest of $21,792 (2009: $5,789) on this note.

Acrongenomics, Inc.
(A Development Stage Company)
Notes to the Financial Statements
June 30, 2010 and 2009
(Unaudited - Stated in US Dollars) - Page 5

Note 5	Convertible Promissory Notes Payable – (cont’d)
	$150,000 Promissory Note
	On July 15, 2009, the Company was loaned an additional $150,000 by the same director of the Company by issuance of a convertible promissory note, payable on demand, with interest accruing on the balance of the principal outstanding at 10% per annum compounded monthly and payable monthly. The note contained a similar repayment feature wherein the Company agreed to repay the note in Canadian dollars at a foreign exchange rate of not less than $1US = $1.27 Canadian. The note is convertible into units of the Company at a price of $0.40 per unit. Each unit will consist of one common share and one share purchase warrant exercisable at $0.75 per share for a period of two years from the date of issuance.
	For the six months ended June 30, 2010, the Company recorded a foreign exchange gain of $2,026 on the note resulting in a balance payable as at June 30, 2010 of $179,506.
	Additionally, the conversion feature of this note failed the two-step evaluation criteria contained in ASC 815-40 and, as a result, it was determined that it was required to be bifurcated from the host contract and recorded as a derivative liability. In accordance with ASC 815, the Company is required to re-measure the fair value of the derivative at each reporting period with the change in fair value recorded as a gain or loss in the Statement of Operations. At June 30, 2010, the Company re-measured the fair value of the derivative liability and determined it had a fair value of $nil.
	During the six months ended June 30, 2010, the Company accrued interest of $7,953 (12 months ended December 31, 2009: $5,785) on this note.
	The notes are collaterized by an interest in all property of the Company.
Note 6	Loans Payable
	On April 1, 2010, the Company was loaned €25,000 (US $33,090) by issuance of a promissory note, payable on demand, with interest accruing on the balance of the principle outstanding at 8 percent per annum compounding monthly and payable quarterly, maturing on October 1, 2010. For the six months ended June 30, 2010, the Company recorded a foreign exchange gain of $2,365 on the note resulting in a balance payable as at June 30, 2010 of $30,725.
	As at June 30, 2010, the Company has received additional unsecured advances totalling $27,628. These advances are non-interest bearing and have no specific terms for repayment.
Note 7	Related Party Transactions
	The Company incurred the following charges with directors and officers, companies with a common director and former director, an officer and director of a company of which a former officer and director is the spouse of the Company’s president; the research and development expenditures were paid to a company in which a former officer and director of the Company is the spouse of the Company’s former president.

Acrongenomics, Inc.
(A Development Stage Company)
Notes to the Financial Statements
June 30, 2010 and 2009
(Unaudited - Stated in US Dollars) - Page 6

Note 7 Related Party Transactions – (cont’d)

										August 17, 1999
										(Date of Inception)
		For the Three Months Ended				For the Six Months Ended				to
		June 30,				June 30,				June 30,
		2010		2009		2010		2009		2010
Accounting fees	$	17,769	$	26,926	$	36,734	$	51,705	$	393,092
Consulting fees		34,500		34,500		69,000		89,000		793,901
Legal fees		-		-		-		-		60,656
Management fees		-		-		-		-		2,747,128
Rent		-		-		-		-		36,000
Research and development		-		-		-		-		5,604,189
Interest and accretion and fees on convertible Promissory notes - Note 5		15,058		9,934		29,746		15,723		460,385
	$	67,327	$	71,360	$	135,480	$	156,428	$	10,095,351

	Research and development expenditures charged by a related company were comprised of testing costs of the molecular diagnostic test products.
	Accounts payable and accrued liabilities at June 30, 2010 includes $298,771 (December 31, 2009: $195,037) owing to companies with a common director, a former director and a company of which a former officer and director is the spouse of the Company’s former president for accounting, management and consulting services received.
	Loans payable at June 30, 2010 includes $18,628 (December 31, 2009: $nil) owing to a former officer and director and the spouse of a former officer and director of the company.
Note 8	Common Stock
	On February 6, 2009, the Company issued 625,000 units pursuant to a private placement at $0.40 per share for total proceeds of $250,000. Each unit consisted of one share and one common share purchase warrant exercisable at $0.75 for a period of two (2) years. The Company paid a commission of $25,000 on this placement.
	On February 6, 2009, the Company issued 66,250 units pursuant to a subscription received of $26,500 as at December 31, 2008. Each unit consisted of one share and one common share purchase warrant exercisable at $0.75 for a period of two (2) years.
	On May 15, 2009, the Company issued 525,000 units pursuant to a private placement at $0.40 per share for total proceeds of $210,000. Each unit consisted of one share and one common share purchase warrant exercisable at $0.75 for a period of two (2) years. The Company paid a commission of $16,000 on this placement.
	On July 22, 2009, the Company issued 105,000 units @ $0.40 per unit for total proceeds of $42,000 received on February 1, 2010. Each unit consists of one share and one common share purchase warrant exercisable at $0.75 for a period of two (2) years. The Company paid a commission of $4,200 on this placement.
	On September 16, 2009, the Company issued 165,000 units pursuant to a private placement at $0.40 per share for total proceeds of $66,000. Each unit consisted of one share and one common share purchase warrant exercisable at $0.75 for a period of two (2) years. The Company paid a commission of $5,900 on this placement.

Acrongenomics, Inc.
(A Development Stage Company)
Notes to the Financial Statements
June 30, 2010 and 2009
(Unaudited - Stated in US Dollars) - Page 7

Note 8	Common Stock – (cont’d)
	On September 30, 2009, the Company issued 137,500 units at $0.40 per unit for total proceeds of $55,000. Each unit consists of one share and one common share purchase warrant exercisable at $0.75 for a period of two (2) years. The Company paid a commission of $5,500 on this placement.
	On October 29, 2009, the Company issued 50,000 units at $0.40 per unit for total proceeds of $20,000. Each unit consists of one share and one common share purchase warrant exercisable at $0.75 for a period of two (2) years. The Company paid a commission of $2,000 on this placement.
	On April 15, 2010, the Company issued 25,000 units at $0.40 per unit for total proceeds of $10,000. Each unit consists of one share and one common share purchase warrant exercisable at $0.75 for a period of two (2) years. No commission is payable on this placement.
	On May 14, 2010, the Company issued 175,000 units at $0.20 per unit for total proceeds of $35,000. Each unit consists of one share of common stock and one common share purchase warrant exercisable at $0.50 for a period of two (2) years.
	Commitments
	Share Purchase Warrants
	A summary of changes in the Company’s share purchase warrants for the six months ended June 30, 2010 and December 31, 2009 outstanding is presented below:

	June 30, 2010		December 31, 2009
		Weighted			Weighted
		Average			Average
	Number of	Exercise	Number of		Exercise
	Warrants	Price	Warrants		Price
Outstanding, beginning of period	3,124,000	$0.75	3,257,870		$1.20
Issued	200,000	$0.53	1,673,750		$0.75
Expired	-	-	(1,807,620	)	$1.57
Outstanding, end of period	3,324,000	$0.74	3,124,000		$0.75

The following table summarizes the warrants outstanding as at June 30, 2010:

Number Outstanding	Exercise
and Exercisable	Price	Expiry Date
290,000	$0.75	July 31,2010(1 )
317,750	$0.75	August 31, 2010
120,000	$0.75	September 30,2010
375,000	$0.75	October 31, 2010
347,500	$0.75	December 31, 2010
20,000	$0.75	January 31,2011
671,250	$0.75	February 28, 2011
525,000	$0.75	May 31, 2011
165,000	$0.75	September 30, 2011
187,500	$0.75	October 31, 2011
105,000	$0.75	February 28, 2012
25,000	$0.75	April 15, 2012
175,000	$0.50	June 15, 2012
3,324,000

(¹) Subsequent to June 30, 2010, these warrants expired unexercised.

Acrongenomics, Inc.
(A Development Stage Company)
Notes to the Financial Statements
June 30, 2010 and 2009
(Unaudited - Stated in US Dollars) - Page 8

Note 8	Commitments – (cont’d)
	Stock-Based Compensation Plan
	In May, 2005, the Company adopted a stock option plan which provides for the granting of stock options to selected directors, officers, employees or consultants in an aggregate amount of up to 2,600,000 common shares of the Company and, in any case, the number of shares to be issued to any one individual pursuant to the exercise of options shall not exceed 10% of the issued and outstanding share capital. The grant of stock options, exercise prices and terms are determined by the Company's Board of Directors.
	A summary of changes in the Company’s stock options for the six months ended June 30, 2010 and the year ended December 31, 2009 is presented below:

	June 30, 2010		December 31, 2009
		Weighted			Weighted
		Average			Average
	Number of	Exercise	Number of		Exercise
	Options	Price	Options		Price
Outstanding, beginning of period	2,100,000	$0.76	3,500,000		$0.70
Granted	-	-	700,000		$0.57
Cancelled	-	-	(2,100,000	)	$0.50
Outstanding, end of period	2,100,000	$0.76	2,100,000		$0.76
Exercisable, end of period	2,100,000	$0.76	2,050,000		$0.76

At June 30, 2010 the following stock options were outstanding:

Number of shares
						Aggregate
Total		Number	Exercise	Expiry		Intrinsic
Number		Vested	Price	Date		Value
600,000	(1)	600,000	$1.00	March 22, 2012	$	-
100,000	(2)	100,000	$2.50	May 3, 2016	$	-
600,000	(3)	600,000	$0.50	February 12, 2017	$	-
500,000	(4)	500,000	$0.60	March 31, 2018	$	-
100,000	(5)	100,000	$0.50	April 1, 2018	$	-
200,000	(6)	200,000	$0.50	April 1, 2018	$	-
2,100,000		2,100,000

Acrongenomics, Inc.
(A Development Stage Company)
Notes to the Financial Statements
June 30, 2010 and 2009
(Unaudited - Stated in US Dollars) - Page 9

Note 8	Common Stock – (cont’d)
	Commitments – (cont’d)
	Stock-Based Compensation Plan – (cont’d)

(1)	As at June 30, 2010, these options had fully vested and no stock-based compensation was recognized in the financial statements for the period then ended.
(2)	As at June 30, 2010, these options had fully vested and no stock-based compensation was recognized in the financial statements for the period then ended.
(3)	As at June 30, 2010, these options had fully vested and no stock-based compensation was recognized in the financial statements for the period ended March 31, 2010 (2009: $11,647).
(4)	As at June 30, 2010, these options had fully vested and no stock-based compensation was recognized in the financial statements for the period then ended.
(5)	As at June 30, 2010, these options had fully vested and no stock-based compensation was recognized in the financial statements for the period then ended.
(6)	As at June 30, 2010, 200,000 of these options were fully vested. During the six months ended June 30, 2010, the Company recognized stock-based compensation of $674 (2009: $16,439) included in consulting fees in the financial statements.

A summary of changes in the Company’s unvested stock options for the six month period ended June 30, 2010 and the year ended December 31, 2009 is presented below:

	June 30, 2010				December 31, 2009
			Weighted	Weighted			Weighted	Weighted
			Average	Average			Average	Average
	Number of		Exercise	Grant Date	Number of		Exercise	Grant Date
	Options		Price	Fair Value	Options		Price	Fair Value
Outstanding, beginning of period	50,000		$0.50	$0.43	300,000		$0.50	$0.43
Granted	-		-	-	-		-	-
Cancelled	-		-	-	-		-	-
Vested	(50,000	)	$0.50	$0.43	(250,000	)	$0.50	$0.43
Outstanding, end of period	-		-	-	50,000		$0.50	$0.43

Stock-based compensation amounts, including those related to shares issued for non-cash consideration during the period, are classified in the Company’s Statement of Operations as follows:

		2010		2009
Consulting fees	$	674	$	16,439
Management fees		-		11,647
	$	674	$	28,086

Acrongenomics, Inc.
(A Development Stage Company)
Notes to the Financial Statements
June 30, 2010 and 2009
(Unaudited - Stated in US Dollars) - Page 10

Note 9	Subsequent Events
	Subsequent to June 30, 2010, the Board of Directors approved the issuance of 985,000 shares and the grant of 1,200,000 options to directors and consultants of the company for services rendered. The options vest on a graded vesting schedule where by 25% of the options will vest 3 months after the grant date and every 3 months thereafter until fully vested. They have an exercise price of $0.50 per share and are exercisable for a period of 8 years from the date of issue.
Note 10	Comparative Figures
	Certain of the comparative figures have been reclassified to conform with the presentation for the current period.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Forward-Looking Statements

This quarterly report contains forward-looking statements. These statements relate to future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as “may”, “should”, “expect”, “plan”, “anticipate”, “believe”, “estimate”, “predict”, “potential” or “continue” or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties and other factors, including the risks in the section entitled “Risk Factors”, which may cause our or our industry’s actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. Examples of forward-looking statements in this quarterly report include statements regarding, by way of example and not in limitation:

• the plans of Molecular Vision;

• our intention to acquire additional shares in Molecular Vision;

• our intention to close the share exchange transaction with Vardisto;

• our belief that certain products will be classified in certain categories for regulator purposes; and

• our cash requirements for the next 12 months.

Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results.

In this report, unless otherwise specified, all references to “common shares” refer to the common shares of our capital stock.

As used in this quarterly report, the terms “we”, “us”, “our”, and “Acrongenomics” refer to Acrongenomics Inc., unless otherwise indicated. All references to $ means United States dollars.

Plan of Operation

Corporate Overview

Until August 19, 2008, we had been operating pursuant to a development agreement with Molecular Vision Limited (“Molecular Vision”), whereby we funded the development of the point-of-care device of Molecular Vision in return for a license to commercialize and sell the device. On August 19, 2008, we changed our relationship with Molecular Vision by entering into an interim agreement, and a subsequent agreement on November 13, 2008, whereby, we terminated our previous development agreement in exchange for a royalty on product sales or license fees received by Molecular Vision for products or licenses based on Molecular Vision’s suite of patents, and we received 17,168 additional common shares of Molecular Vision.

On January 31, 2009, we entered into a share exchange agreement with Vardisto Investments Limited (“Vardisto”), whereby we agreed to acquire 600 shares of common stock of Vardisto, representing 60% of their total outstanding share capital in exchange for the issuance of 9,000,000 shares of our common stock. The share exchange agreement is conditional upon certain events occurring and there is no assurance that the share exchange agreement will close. As at August 20, 2010, we have not issued the 9,000,000 share in connection with the acquisition of Vardisto and the transaction has not closed.

3

Over the next 12 months, we will work on closing the share exchange agreement with Vardisto. Further, we intend to work with Molecular Vision to develop and commercialize the BioLED Technology.

Cash Requirements

We have not generated any revenues and our operating activities have resulted in a loss of $153,694 for the three month period ended June 30, 2010 and a loss of $185,706 for the three month period ended June 30, 2009. This negative cash flow is attributable to our operating expenses, including but not limited to, general and administration and the payment of our consulting fees, audit fees and legal fees. We anticipate that our expenses will increase as we intend to focus on the development of our new project with Vardisto. We estimate our expenses in the next 12 months will be approximately $1,800,000, generally falling in four major categories: research and development, general and administrative expenses, investor relations and professional fees.

We estimate our operating expenses and working capital requirements for the next 12 months to be as follows:

Expense		Amount
Research & Development	$	500,000
General & Administrative	$	600,000
Investor Relations	$	400,000
Professional fees	$	300,000
	$	1,800,000

Research & Development expenses are expected to include our contributions to the research and development of the potential cholesterol-lowering agent that is currently in development by the subsidiary of Vardisto. If we do not acquire Vardisto, then we intend to seek out and acquire another, as yet unknown, technology and to spend approximately this amount on our research and development.

General & Administrative expenses will include consulting fees, office rent, utilities, communication, office equipment and supplies, banking fees, insurance, corporate materials, accounting and temporary office assistance.

Investor relations expenses will include the costs of paying for investor relations representatives, press releases, advertising, and travel expenses related to promoting our company.

Professional fees will include all payments to our outsourced attorney and independent auditor.

As of June 30, 2010, we had approximately $495 in cash. We do not have enough funds to pay for our estimated operating expenses for the next 12 months and require additional financing to continue our business. We anticipate that we will have to address the cash shortfall through additional equity financings in the future. We can offer no assurance, however, that such financings will be available on terms acceptable to our company. The weakening of economic conditions in the U.S. and around the world could have harmful effects on our ability to raise money to fund our planned operations.

We believe that decreases in value of the common shares of many companies worldwide will make selling shares of our common stock increasingly difficult. If we are not able to sell enough of our shares to meet our financial needs, we will have to consider borrowing the money we need. Because of the credit crisis, it is possible that we would not be able to borrow adequate amounts to fund our operations on terms and at rates of interest we find acceptable and in our best interests. If we are unable to obtain the amount of money that we need to fund our operations, then we will likely go out of business and investors will lose their entire investment in our company.

We do not expect that the difficult economic conditions are likely to improve significantly in the near future. Further deterioration of the economy, and even consumer fear that the economy will deteriorate further could intensify the adverse effects of these difficult market conditions.

4

Purchase of Significant Equipment

We do not intend to purchase any significant equipment.

Personnel Plan

We currently have two executive officers and one consultant, which are engaged pursuant to consulting agreements.

General Administration

We anticipate spending approximately $600,000 on general and administration costs in the next 12 months. These costs are expected to consist primarily of travel, office, rent and consulting fees.

Results of Operations

Our operating results for the three and six month period ended June 30, 2010 and June 30, 2009 are summarized as follows:

		Three			Three
		Months			Months			Six Months			Six Months
		Ended			Ended			Ended			Ended
		June 30,			June 30,			June 30,			June 30,
		2010			2009			2010			2009
Revenue	$	-		$	-		$	-		$	-
Expenses		153,694			185,706			284,088			383,010
Net income (loss)	$	(54,429	)		(232,337	)		(304,409	)		(443,619	)

Revenue

We have not earned any revenues since our inception and we do not anticipate earning revenues until such time as we have begun commercial production or receive royalties from our investment with Molecular Vision.

Expenses

Our expenses for the three and six month period ended June 30, 2010 and 2009 are summarized as follows:

		Three Months Ended				Six Months Ended
		June 30				June 30
		2010		2009		2010		2009
Expenses
Accounting and audit fees	$	67,409	$	59,403	$	116,374	$	94,182
Amortization of patents		-		-		-		-
Appraisals		-		-		-		-
Bank charges		461		481		763		934
Consulting fees		64,500		72,911		129,674		184,654
Legal fees		2,803		31,872		2,803		42,438
Management fees		-		-		-		11,647
Office and miscellaneous		486		738		1,151		2,211
Public relations and donation		-		-		-		7,600
Rent		15,455		15,278		30,743		30,557
Research and development		-		-		-		-
Transfer agent and filing fees		2,580		2,399		2,580		4,291
Travel		-		2,624		-		4,496
Write-down of patents		-		-		-		-
Total Expenses	$	153,694	$	185,706	$	284,088	$	383,010

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Three Months Ended June 30, 2010 and 2009

Expenses for the three months ended June 30, 2010 decreased by $32,012 over the same period in 2009.

Accounting and audit fees

Accounting and audit fees for the three months ended June 30, 2010 increased by $8,006 compared to the same period in 2009. This was primarily the result of an increase in our audit fees for the year ended December 31, 2009, which were invoiced during the three month ended June 30, 2010.

Consulting fees

The consulting fees for the three months ended June 30, 2009 decreased by $8,411 compared to the same period in 2009. This was primarily the result of reduction in termination of a temporary consultant.

Legal fees

Legal fees for the three months June 30, 2010 were reduced by $29,069compared to the same period in 2009. This was primarily due to agreements required in 2009 for the Vardisto Investments and for legal review of agreements with Molecular Vision, which were not required in 2010.

Travel expenses

Travel expenses for the three months ended June 30, 2010 decreased by $2,624 compared to the same period ended June 30, 2009. This was primarily the result of a reduction in travel during the three months ended June 30, 2010.

Six months ended June 30, 2010 and 2009

Expenses for the six months ended June 30, 2010 decreased by $98,922 over the same period in 2009.

Accounting and audit fees

Accounting and audit fees for the six months ended June 30, 2010 increased by $22,192 compared to the same period in 2009. This was due to increase in auditing fees invoiced during the six months after December 31, 2009.

Consulting fees

Consulting fees for the six months ended June 30, 2010 decreased by $54,980 compared to the same period in 2009. This was primarily the result of recording in 2009 signing bonuses as consulting fees and paying $20,000 to a temporary consultant.

Legal fees

Legal fees for the six months ended June 30, 2010 were reduced by $39,635 due to additional work for agreements required in 2009 on Vardisto Project and Molecular Vision, which was not required in 2010.

Management Fees

Management fees payable for the six months ended June 30, 2010 decreased by $11,647 compared to the same period in 2009. This is primarily due to our not incurring any management fees for the six months ended June 30, 2010.

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Public Relations and Donations

Public relations fees payable for the six months ended June 30, 2010 decreased by $7,600 compared to the same period in 2009. This is primarily due to not paying any fees for public relations during the six months ended June 30, 2010.

Travel expense

Travel expense for the six months ended June 30, 2010 decreased by $4,496 compared to the same period in 2009. This is primarily due to reduction in travel operations.

Liquidity and Capital Resources

Working Capital

Our working capital as at June 30, 2010 and December 31, 2009 is summarized as follows:

		At June 30,			At December 31,
		2010			2009
Cash	$	495		$	4,303
Current Assets		15,000			15,000
Current Liabilities		(1,635,598	)		(1,380,671	)
Working Capital (Deficit)	$	(1,620,103	)	$	(1,361,368	)

The increase in our working capital deficit of $258,735 was primarily due to an increase in our accounts payable and accrued liabilities.

During February 2010, we sold 105,000 units to one offshore investor at $0.40 per unit for gross proceeds of $42,000. Each unit consists of one share of common stock and one warrant to purchase one share of our common share at a price of $0.75 for a period of two years from the date of issuance. We paid $4,200 commissions for the sale of these units.

During April 2010, we sold 25,000 units to one U.S. investor at $0.40 per unit for gross proceeds of $10,000. Each unit consists of one share of common stock and one warrant to purchase one share of our common share at a price of $0.75 for a period of two years from the date of issuance. We paid $1,000 as commissions for the sale of these units.

During May 2010, we sold 175,000 units to two offshore investors at $0.20 per unit for gross proceeds of $35,000. Each unit consists of one share of common stock and one warrant to purchase one share of our common share at a price of $0.75 for a period of two years from the date of issuance. No commissions were paid on the sale of these units.

We issued a convertible promissory note dated April 1, 2010 with a maturity date of October 1, 2010 for proceeds received in the amount of €25,000 (US$33,090). The note bears interest at 8% per annum and is convertible into units of our company at $0.20 per unit. Each unit will consist of one share and one share purchase warrant exercisable at US $0.50 for a period of 2 years.

On April 8, 2010 we received $5,000 loan advance from one of our stockholders. On April 14, 2010, we received $3,000 loan advance from one of our stockholders. These loans are non-interest bearing and payable one month from date of demand.

On March 5, 2010, we received unsecured advances of $7,320 from Platon Tzouvalis, our president and one of our directors, and on May 14, 2010, we repaid Mr. Tzouvalis in full. This advance was non-interest bearing and had no specific terms for repayment.

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On March 11, 2010 and May 14, 2010, we received unsecured advances of $13,506.46 and $5,121.23, respectively, from Ron Lizée, our chief financial officer and one of our directors, and his spouse. These advances are non-interest bearing and have no specific terms for repayment.

Cash Flows

Our cash flow for the six month periods ended June 30, 2010 and 2009 is summarized as follows:

	Six Months		Six Months
	Ended		Ended
	June 30,		June 30,
	2010		2009
Net cash used in operating activities	(108,526	)	(399,079	)
Net cash used in investing activities	-		(14,142	)
Net cash provided by financing activities	104,718		419,000
Increase (decrease) in cash during the period	(3,808	)	5,779

Cash Used In Operating Activities

During the six months ended June 30, 2010, we used net cash in operating activities in the amount of $108,526 primarily towards payments for our expense of office, consulting and professional fees, as well as increasing our accounts payables.

Cash Used In Investing Activities

During the six months ended June 30, 2010, we did not use any cash in investing activities.

Cash from Financing Activities

We received net cash of $104,718 from financing activities during the six months ended June 30, 2010. Net cash generated by financing activities is attributable to cash received from the sale of 200,000 shares of our common stock for a total of $45,000 and loan advances of $59,718.

Going Concern

We have historically incurred losses and have incurred a net loss of $54,429 for the three months ended June 30, 2010 and $304,409 for the six months ended June 30, 2010. Because of these historical losses, we will require additional working capital to develop our business operations. We intend to raise additional working capital through equity financing, bank financing and/or advances from related parties or stockholder loans.

The continuation of our business is dependent upon obtaining further financing and achieving a break even or profitable level of operations. The issuance of additional equity securities by us could result in a significant dilution in the equity interests of our current or future stockholders. Obtaining commercial loans, assuming those loans would be available, will increase our liabilities and future cash commitments.

There are no assurances that we will be able to either (i) achieve a level of revenues adequate to generate sufficient cash flow from operations; or (ii) obtain additional financing through either equity financing and/or bank financing necessary to support our working capital requirements. To the extent that funds generated from operations and any equity financing and/or bank financing are insufficient, we will have to raise additional working capital. No assurance can be given that additional financing will be available, or if available, will be on terms acceptable to us. If adequate working capital is not available we may scale down or even cease our operations.

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Our auditors have included an explanatory paragraph in the audit report of the year-ended December 31, 2009 financial statements that we are in the development stage, we have not yet achieved profitable operations and we are dependent on our ability to raise capital from shareholders or other sources to meet our obligations and repay our liabilities arising from normal business operations when they come due.

These conditions raise substantial doubt about our ability to continue as a going concern. The financial statements do not include any adjustments relating to the recoverability and classification of asset carrying amounts or the amount and classification of liabilities that might be necessary should we be unable to continue as a going concern.

Future Financing

We will require additional financing to fund our planned operations, including researching and developing our patents, the related compounds and any further intellectual property that we may acquire and entering some of our current compounds into clinical trials. We currently do not have committed sources of additional financing and may not be able to obtain additional financing, particularly, if the volatile conditions in the stock and financial markets, and more particularly the market for early development stage biotechnology research and development company stocks persist.

There can be no assurance that additional financing will be available to us when needed or, if available, that it can be obtained on commercially reasonable terms. If we are not able to obtain the additional financing on a timely basis, if and when it is needed, we will be forced to delay or scale down some or all of our research and development activities or perhaps even cease the operation of our business.

Since inception we have funded our operations primarily through equity and debt financings and we expect that we will continue to fund our operations through equity and debt financing. If we raise additional financing by issuing equity securities, our existing stockholders’ ownership will be diluted. Obtaining commercial loans, assuming those loans would be available, will increase our liabilities and future cash commitments.

There is no assurance that we will be able to maintain operations at a level sufficient for an investor to obtain a return on his, her, or its investment in our common stock. Further, we may continue to be unprofitable.

Off-Balance Sheet Arrangements

We have no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to our stockholders.

Item 3. Quantitative and Qualitative Disclosures About Market Risks.

Not Applicable.

Item 4T. Controls and Procedures.

Disclosure Controls and Procedures

As required by Rule 13a-15 under the Securities Exchange Act of 1934, our management, with the participation of our principal executive officer and our principal financial officer, evaluated our disclosure controls and procedures (as defined in Rules 13a-15(e) of the Securities Exchange Act of 1934) as of the end of the period covered by this quarterly report on Form 10-Q. Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commission’s rules and forms. Disclosure controls and procedures include controls and procedures designed to ensure that information required to be disclosed in our reports filed under the Securities Exchange Act of 1934 is accumulated and communicated to our principal executive officer and our principal financial officer to allow timely decisions regarding required disclosure.

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Based on that evaluation, our management, with the participation of our principal executive officer and our principal financial officer, concluded that as of the end of the period covered by this quarterly report on Form 10-Q, our disclosure controls and procedures were not effective. The ineffectiveness of our disclosure controls and procedures was due to the material weaknesses disclosed below.

We intend to take appropriate and reasonable steps to make the necessary improvements to remediate these deficiencies at some time in the future. This will depend on our financial position and the management’s determination of which changes should be made and when. We intend to consider the results of our remediation efforts and related testing as part of our year-end assessment of the effectiveness of our internal control over financial reporting.

We continue to have material weaknesses in our internal control over financial reporting as disclosed in our annual report on Form 10-K filed on April 15, 2010. We have not implemented remediation measures for the material weaknesses described in our annual report due to lack of funds. These material weaknesses are in our internal control processes over procurement and disbursements, primarily related to lack of segregations of duties.

More specifically, management has identified the following weaknesses:

• Our company does not have a code of conduct or ethics;

• Our company does not have Human Resources policies and Procedures and Function Activities are not clearly defined;

• Our company does not have a specific Mission Statement or Key Performance indicators;

• Our company's accounting staff does not have sufficient technical accounting knowledge relating to accounting for income taxes and complex US GAAP matters. Management corrected any errors prior to the release of our company's June 30, 2010 financial statements.

We intend to implement remediation measures for these material weaknesses. Such remediation activities include the following:

(1)	We intend to appoint independent members to our audit committee in the 2010 fiscal year;
(2)	We intend to update the documentation of our internal control processes, including formal risk assessment of our financial reporting processes as well as codify a code of conduct and ethics;
(3)	We intend to update our business plan to include a Mission Statement and document our key performance indicators; and
(4)	We intend to engage the services of an independent consultant with sufficient expertise in complex US GAAP matters to assist us in the preparation of our financial statements.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting during the fiscal quarter ended June 30, 2010 that have materially affected, or are reasonably likely to materially affect our internal control over financial reporting.

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PART II - OTHER INFORMATION

Item 1. Legal Proceedings.

We know of no material, existing or pending legal proceedings to which we are a party or of which any of our properties is the subject. In addition, we do not know of any such proceedings contemplated by any governmental authorities. We know of no proceedings in which any of our directors, officers or affiliates, or any registered or beneficial stockholder is a party adverse to our company or has a material interest adverse to our company.

Item 1A. Risk Factors.

Much of the information included in this report includes or is based upon estimates, projections or other “forward-looking statements”. Such forward-looking statements include any projections and estimates made by us and our management in connection with our business operations. While these forward-looking statements, and any assumptions upon which they are based, are made in good faith and reflect our current judgment regarding the direction of our business, actual results will almost always vary, sometimes materially, from any estimates, predictions, projections, assumptions or other future performance suggested herein. Such estimates, projections or other “forward-looking statements” involve various risks and uncertainties as outlined below. We caution the reader that important factors in some cases have affected and, in the future, could materially affect actual results and cause actual results to differ materially from the results expressed in any such estimates, projections or other “forward-looking statements”.

Shares of our common stock are speculative, especially since we are in the development stage of our new business. We operate in a volatile sector of business that involves numerous risks and uncertainties. The risks and uncertainties described below are not the only ones we face. Other risks and uncertainties, including those that we do not currently consider material, may impair our business. If any of the risks discussed below actually occur, our business, financial condition, operating results or cash flows could be materially adversely affected. This could cause the trading price of our securities to decline, and you may lose all or part of your investment. Prospective investors should consider carefully the risk factors set out below.

Risks Related to our Financial Condition

We have not earned any revenues since our incorporation and only have a limited operating history in our current business, which raise doubt about our ability to continue as a going concern.

Our company has a limited operating history in our current business and is in the development stage. We have not generated any revenues since our inception and we will, in all likelihood, continue to incur operating expenses without significant revenues until Molecular Vision successfully develops its BioLED Technology and commercializes its future point-of-care testing devices. Our primary source of funds has been the sale of our common stock. We cannot assure that we will be able to generate any significant revenues or income. These circumstances make us dependent on additional financial support until profitability is achieved.

Our independent auditors have expressed substantial doubt about our ability to continue as a going concern, which may hinder our ability to obtain future financing.

Since our inception, we have accumulated a deficit of $27,982,184 as at June 30, 2010 and incurred a net loss of $411,789 during the six month period ended June 30, 2010. These circumstances raise substantial doubt about our ability to continue as a going concern, as described in the explanatory paragraph to our independent auditor’s report on our consolidated financial statements for the year ended December 31, 2009, which are included in our annual report on Form 10-K filed with the SEC on April 15, 2010. Although our consolidated financial statements raise substantial doubt about our ability to continue as a going concern, they do not include any adjustments relating to recoverability and classification of recorded assets, or the amounts or classifications of liabilities that might be necessary in the event our company cannot continue in existence.

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Risks Related to our Business

The global financial crisis has had, and may continue to have, an impact on our business and financial condition.

The ongoing global financial crisis may also limit our ability to access the capital markets at a time when we would like, or need, to raise capital, which could have an impact on our ability to react to changing economic and business conditions. Accordingly, if the global financial crisis and current economic downturn continue or worsen, our business, results of operations and financial condition could be materially and adversely affected.

The share exchange agreement with Vardisto may not complete and we may not obtain an interest in the development of the potential cholesterol-lowering agent.

The share exchange agreement may not complete and we may not obtain an interest in the development of the potential cholesterol-lowering agent. Even if we do obtain an interest in the potential cholesterol-lowering agent, there is no assurance that it will ever become commercially viable. The development of life science technology is extremely risky and expensive. It is likely that we will never develop and sell a product that will make us profitable. If we never become profitable, we will go out of business and investors will lose all of the money they have invested in our company.

We need to raise additional financing to support the research and development of future business but we cannot be sure that we will be able to obtain additional financing on terms favorable to us when needed. If we are unable to obtain additional financing to meet our needs, our operations may be adversely affected or terminated.

Our ability to develop our business is dependent upon our ability to raise significant additional financing when needed. Our future capital requirements will depend upon many factors, including:

• the closing of the share exchange agreement with Vardisto;

• investments in other technologies or technology companies; and

• any additional investments in Molecular Vision, including investments required to maintain our ownership position.

We have limited financial resources and to date, no cash flow from operations and we are dependent for funds on our ability to sell our common stock, primarily on a private placement basis. There can be no assurance that we will be able to obtain financing on that basis in light of factors such as the market demand for our securities, the state of financial markets generally and other relevant factors. Any sale of our common stock in the future will result in dilution to existing stockholders. Furthermore, there is no assurance that we will not incur debt in the future, that we will have sufficient funds to repay our future indebtedness or that we will not default on our future debts, jeopardizing our business viability. Finally, we may not be able to borrow or raise additional capital in the future to meet our needs or to otherwise provide the capital necessary to conduct the development of our technology, which might result in the loss of some or all of your investment in our common stock.

Molecular Vision may be subject to intellectual property litigation such as patent infringement claims, which could adversely affect our business.

Other patents could exist or could be filed which would prohibit or limit Molecular Vision’s ability to develop the BioLED Technology. In the event of an intellectual property dispute, we may be forced to litigate. Intellectual property litigation would divert attention away from developing the BioLED Technology and marketing our potential products and be very expensive. An adverse outcome could take our ability to develop or commercialize a potential product and could prevent us from becoming profitable.

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Because some of our officers and directors are located in non-U.S. jurisdictions, you may have no effective recourse against the management for misconduct and may not be able to enforce judgment and civil liabilities against our officers, directors, experts and agents.

Most of our directors and officers are nationals and/or residents of countries other than the United States, and all or a substantial portion of their assets are located outside the United States. As a result, it may be difficult for you to enforce within the United States any judgments obtained against our officers or directors, including judgments predicated upon the civil liability provisions of the securities laws of the United States or any U.S. state.

If we are deemed to be an investment company under the Investment Company Act, we may be required to institute burdensome compliance requirements and our activities may be restricted.

TheInvestment Company Act of 1940(the “Investment Company Act”) contains substantive legal requirements that regulate the manner in which investment companies are permitted to conduct their business activities. If we are deemed to be an investment company under the Investment Company Act, we may be required to institute burdensome compliance requirements and our activities may be restricted, which would materially adversely affect our business, financial condition and results of operations. In addition, our contracts would be voidable and a court could appoint a receiver to take control of and liquidate our business.

In order not to be regulated as an investment company under the Investment Company Act, unless we can qualify for an exemption, we must ensure that we are engaged primarily in a business other than investing, reinvesting, owning, holding or trading in securities (as defined in the Investment Company Act) and that we do not own or acquire “investment securities” having a value exceeding 40% of the value of our total assets (exclusive of U.S. government securities and cash items) on an unconsolidated basis. The SEC has adopted Rule 3a-1 that provides an exemption from registration as an investment company if a company meets both an asset and an income test and is not otherwise primarily engaged in an investment company business by, among other things, holding itself out to the public as such or by taking controlling interests in companies with a view to realizing profits through subsequent sales of these interests. A company satisfies the asset test of Rule 3a-1 if it has no more than 45% of the value of its total assets (adjusted to exclude U.S. Government securities and cash) in the form of securities other than interests in majority-owned subsidiaries and companies which it primarily and actively controls. A company satisfies the income test of Rule 3a-1 if it has derived no more than 45% of its net income for its last four fiscal quarters combined from securities other than interests in majority owned subsidiaries and primarily controlled companies.

Our ability to hire and retain qualified personnel will be an important factor in the success of our business and a failure to hire and retain key personnel may result in our inability to manage and implement our business plan.

Our ability to hire and retain qualified personnel will be an important factor in the success of our business. In addition, in order to manage growth effectively, we must implement management systems and continue to recruit and train new employees. We may not be able to attract and retain the necessary qualified personnel. If we are unable to retain or to hire qualified personnel as required, we may not be able to adequately manage and implement our business plan.

Our disclosure controls and procedures and internal control over financial reporting were proven not effective, which may cause our financial reporting to be unreliable and lead to misinformation being disseminated to the public.

Our management evaluated our disclosure controls and procedures as of June 30, 2010 and concluded that as of that date, our disclosure controls and procedures were not effective. The ineffectiveness of our disclosure controls and procedures was mainly due to a lack of knowledge regarding U.S. generally accepted accounting principles and the rules of the Securities and Exchange Commission by responsible people within our company.

In addition, our management evaluated our internal control over financial reporting as of December 31, 2009 and concluded that that there were material weaknesses in our internal control over financial reporting as of that date and that our internal control over financial reporting was not effective as of that date. A material weakness is a deficiency or a combination of control deficiencies in internal control over financial reporting such that there is a

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reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis. We intend to remedy these material weaknesses in the 2010 fiscal year.

We have not yet remediated these material weaknesses and we believe that our disclosure controls and procedures and internal control over financial reporting continue to be ineffective. Until these issues are corrected, our ability to report quarterly and annual financial results or other information required to be disclosed on a timely and accurate basis may be adversely affected and our financial reporting may continue to be unreliable, which could result in additional misinformation being disseminated to the public. Investors relying upon this misinformation may make an uninformed investment decision.

Risks Related to our Common Stock

The weakening of economic conditions around the world could have harmful effects on our company. If these harmful effects cause us to cease our development of medical technologies, then our stockholders will likely lose their entire investment in our company.

The weakening of economic conditions in the U.S. and around the world could have harmful effects on our ability to raise money to fund our planned operations. If this happens, we would likely go out of business and our investors will lose their entire investment in our company.

We believe that decreases in value of the shares of many companies worldwide will make selling shares of our common stock increasingly difficult. If we are not able to sell enough of our shares to meet our financial needs, we will have to consider borrowing the money we need. A tightening of credit conditions has also been experienced in the economy recently. Because of the recent credit crisis, it is possible that we would not be able to borrow adequate amounts to fund our operations on terms and at rates of interest we find acceptable and in the best interests of our company. If we are unable to obtain the amount of money that we need to fund our operations, then we will likely go out of business and investors will lose their entire investment in our company.

Because we do not intend to pay any dividends on our common stock, investors seeking dividend income or liquidity should not purchase shares of our common stock.

We have not declared or paid any dividends on our common stock since our inception, and we do not anticipate paying any such dividends for the foreseeable future. Investors seeking dividend income or liquidity should not invest in our common stock.

A decline in the price of our common stock could affect our ability to raise further working capital and adversely impact our ability to continue operations.

A prolonged decline in the price of our common stock could result in a reduction in the liquidity of our common stock and a reduction in our ability to raise capital. Because a portion of our continued operations will be financed through the sale of equity securities, a decline in the price of our common stock could be especially detrimental to our liquidity and our operations. Such reductions may force us to reallocate funds from other planned uses and may have a significant negative effect on our business plan and operations, including our ability to develop new products and continue our current operations. If our stock price declines, we can offer no assurance that we will be able to raise additional capital or generate funds from operations sufficient to meet our obligations. If we are unable to raise sufficient capital in the future, we may not be able to have the resources to continue our normal operations.

If we issue additional shares in the future, it will result in the dilution of our existing stockholders.

Our articles of incorporation authorize the issuance of up to 100,000,000 shares of common stock with a par value of $0.001. Our board of directors may choose to issue some or all of such shares to acquire one or more businesses or to provide additional financing in the future. The issuance of any such shares will result in a reduction of the book value and market price of the outstanding shares of our common stock. If we issue any such additional shares, such issuance will cause a reduction in the proportionate ownership and voting power of all current stockholders. Further, such issuance may result in a change of control of our company.

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Trading of our stock may be restricted by the Securities Exchange Commission’s penny stock regulations, which may limit a stockholder’s ability to buy and sell our stock.

The Securities and Exchange Commission has adopted regulations which generally define “penny stock” to be any equity security that has a market price (as defined) less than $5.00 per share or an exercise price of less than $5.00 per share, subject to certain exceptions. Our securities are covered by the penny stock rules, which impose additional sales practice requirements on broker-dealers who sell to persons other than established customers and “accredited investors”. The term “accredited investor” refers generally to institutions with assets in excess of $5,000,000 or individuals with a net worth in excess of $1,000,000 or annual income exceeding $200,000 or $300,000 jointly with their spouse. The penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from the rules, to deliver a standardized risk disclosure document in a form prepared by the Securities and Exchange Commission, which provides information about penny stocks and the nature and level of risks in the penny stock market. The broker-dealer also must provide the customer with current bid and offer quotations for the penny stock, the compensation of the broker-dealer and its salesperson in the transaction and monthly account statements showing the market value of each penny stock held in the customer’s account. The bid and offer quotations, and the broker-dealer and salesperson compensation information, must be given to the customer orally or in writing prior to effecting the transaction and must be given to the customer in writing before or with the customer’s confirmation. In addition, the penny stock rules require that prior to a transaction in a penny stock not otherwise exempt from these rules, the broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser’s written agreement to the transaction. These disclosure requirements may have the effect of reducing the level of trading activity in the secondary market for the stock that is subject to these penny stock rules. Consequently, these penny stock rules may affect the ability of broker-dealers to trade our securities. We believe that the penny stock rules discourage investor interest in and limit the marketability of our common stock.

The Financial Industry Regulatory Authority, or FINRA, has adopted sales practice requirements which may also limit a stockholder’s ability to buy and sell our stock.

In addition to the “penny stock” rules described above, FINRA has adopted rules that require that in recommending an investment to a customer, a broker-dealer must have reasonable grounds for believing that the investment is suitable for that customer. Prior to recommending speculative low priced securities to their non-institutional customers, broker-dealers must make reasonable efforts to obtain information about the customer’s financial status, tax status, investment objectives and other information. Under interpretations of these rules, FINRA believes that there is a high probability that speculative low priced securities will not be suitable for at least some customers. FINRA requirements make it more difficult for broker-dealers to recommend that their customers buy our common stock, which may limit your ability to buy and sell our stock and have an adverse effect on the market for our shares.

Our common stock is illiquid and the price of our common stock may be negatively impacted by factors which are unrelated to our operations.

Our common stock currently trades on a limited basis on the OTC Bulletin Board. Trading of our stock through the OTC Bulletin Board is frequently thin and highly volatile. There is no assurance that a sufficient market will develop in our stock, in which case it could be difficult for stockholders to sell their stock. The market price of our common stock could fluctuate substantially due to a variety of factors, including market perception of our ability to achieve our planned growth, quarterly operating results of our competitors, trading volume in our common stock, changes in general conditions in the economy and the financial markets or other developments affecting our competitors or us. In addition, the stock market is subject to extreme price and volume fluctuations. This volatility has had a significant effect on the market price of securities issued by many companies for reasons unrelated to their operating performance and could have the same effect on our common stock.

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Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

Please see Item 5. Other Information of Part II of this quarterly report on Form 10-Q.

Item 3. Defaults Upon Senior Securities.

None.

Item 4. (Removed and Reserved).

Item 5. Other Information.

On March 5, 2010, we received unsecured advances of $7,320 from Platon Tzouvalis, our president and one of our directors, and on May 14, 2010, we repaid Mr. Tzouvalis in full. This advance was non-interest bearing and had no specific terms for repayment.

On March 11, 2010 and May 14, 2010, we received unsecured advances of $13,506.46 and $5,121.23, respectively, from Ron Lizée, our chief financial officer and one of our directors, and his spouse. These advances are non-interest bearing and have no specific terms for repayment.

On August 9, 2010, we issued an aggregate of 985,000 shares of our common stock to nine consultants of our company for services rendered during 2009. Eight of these consultants were not U.S. persons (as that term is defined in Regulation S of the Securities Act of 1933) and they received these shares in transactions that occurred outside of the United States. In issuing these shares to these eight consultants, we relied on the exemption from the registration requirements of the Securities Act of 1933 provided for in Regulation S and/or Section 4(2) of the Securities Act of 1933. The other consultant was a U.S. person (as that term is defined in Regulation S of the Securities Act of 1933) and in issuing these shares to this consultant, we relied on the exemption from the registration requirements of the Securities Act of 1933 provided for in Section 4(2) of the Securities Act of 1933.

On June 1, 2010, we granted 1,200,000 options to a director of our company for the services rendered during 2009. The options vest on a graded vesting schedule where by 25% of the options will vest 3 months after the grant date and every 3 months thereafter until fully vested. They have an exercise price of $0.50 per share and are exercisable for a period of 8 years from the date of grant. In granting these options to the director, we relied on the exemption from the registration requirements of the Securities Act of 1933 provided for in Section 4(2) of the Securities Act of 1933.

Item 6. Exhibits.

Exhibit No.	Document Name
(3)	Articles of Incorporation and Bylaws
3.1	Articles of Incorporation (incorporated by reference to an exhibit to our registration statement on Form 10-SB filed on May 24, 2002, as amended)
3.2	Bylaws, as amended (incorporated by reference to an exhibit to our registration statement on Form 10- SB filed on May 24, 2002, as amended)
(10)	Material Contracts
10.1	Agreement for the Sale of Stock between our company and Dr. Leftheris Georgakopoulos dated February 13, 2006 (incorporated by reference to an exhibit to our current report on Form 8-K filed February 16, 2006)
10.2	Development Agreement between our company and Molecular Vision Limited (incorporated by reference to an exhibit to our current report on Form 8-K filed on February 20, 2007)
10.3	Employment Agreement dated September 3, 2007 between our company and Dr. Dimitris Goundis (incorporated by reference to an exhibit to our current report on Form 8-K filed on September 28, 2007)

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Exhibit No.	Document Name
10.4	Letter Agreement dated February 1, 2008 with Molecular Vision Limited (incorporated by reference to an exhibit to our current report on Form 8-K filed on February 19, 2008)
10.5	Royalty Agreement dated November 13, 2008 with Molecular Vision Limited (incorporated by reference to an exhibit to our current report on Form 8-K filed on November 20, 2008)
10.6	Supplemental Agreement to the Subscription and Shareholders’ Agreement relating to Molecular Vision Limited dated November 13, 2008 (incorporated by reference to an exhibit to our current report on Form 8-K filed on November 20, 2008)
10.7	Option Agreement dated November 13, 2008 with Molecular Vision Limited to acquire additional 20,000 shares of Molecular Vision Limited (incorporated by reference to an exhibit to our current report on Form 8-K filed on November 20, 2008)
10.8	Deed of Termination and Release dated November 13, 2008 with Molecular Vision Limited (incorporated by reference to an exhibit to our current report on Form 8-K filed on November 20, 2008)
10.9	Share Exchange Agreement dated January 31, 2009 between our company, Vardisto Investments Limited and a certain shareholder of Vardisto Investments Limited (incorporated by reference to an exhibit to our current report on Form 8-K filed on March 12, 2009)
10.10	Asset Purchase Agreement dated January 30, 2009 between Maragrita Hadzopoulou-Cladaras and Halldale Ventures Limited (incorporated by reference to an exhibit to our current report on Form 8-K filed on March 12, 2009)
10.11	Promissory note dated June 12, 2008 issued to Ron and Johanne Lizée by our company (incorporated by reference to our quarterly report on Form 10-Q filed on May 15, 2009)
10.12	Promissory note dated July 15, 2009 issued to Ron and Johanne Lizée by our company (incorporated by reference to our quarterly report on Form 10-Q filed on August 14, 2009)
10.13	Employment Agreement dated April 1, 2007 between our company and Platon Tzouvalis (incorporated by reference to an exhibit to our annual report on Form 10-K filed on April 15, 2010)
10.14	Employment Agreement dated April 1, 2007 between our company and Manos Topoglidis (incorporated by reference to an exhibit to our annual report on Form 10-K filed on April 15, 2010)
10.15	Management and Operational Services Agreement dated October 1, 2008 between our company and Vardisto Investments Limited (incorporated by reference to an exhibit to our annual report on Form 10- K filed on April 15, 2010)
(31)	Section 302 Certifications
31.1*	Section 302 Certification of Platon Tzouvalis
31.2*	Section 302 Certification of Ron Lizée
(32)	Section 906 Certifications
32.1*	Section 906 Certification of Platon Tzouvalis
32.2*	Section 906 Certification of Ron Lizée

* Filed herewith.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

ACRONGENOMICS INC.

By: /s/ Platon Tzouvalis                                                              
       Platon Tzouvalis
       President and Director
       (Principal Executive Officer)
       Date: August 20, 2010

By: /s/ Ron Lizée                                                                          
       Ron Lizée
       Chief Financial Officer and Director
       (Principal Financial Officer and Principal 
       Accounting Officer)
       Date: August 20, 2010

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