U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-QSB

(Mark One)
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
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SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended February 29, 2000
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
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SECURITIES EXCHANGE ACT

For the transition period from ____________ TO ____________

Commission file number 1-13527
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BIOQUAL, INC.
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(Exact name of small business issuer as specified in its charter)

State of Delaware 13-3078199
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)

9600 Medical Center Drive, Rockville, Maryland 20850
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(Address of principal executive office) (Zip Code)

Issuer's telephone number, including area code (301) 251-2801

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(Former name, former address and former fiscal year, if changed since
last report)

Check whether the registrant (1) has filed all reports required to be filed by
Section 13 or 15(d) of the 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
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Check whether the registrant filed all documents and reports required to be
filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution of
securities under a plan confirmed by a court. Yes No X
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Common Stock, $.01 par value per share; authorized 25,000,000 shares; 878,256
shares outstanding as of April 7, 2000.

Transitional Small Business Disclosure Format (Check one): Yes No X
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BIOQUAL, Inc.
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INDEX
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Part I. Financial Information Page
- ------------------------------ ----

Item 1. Financial Statements.

Consolidated Balance Sheets, May 31, 1999 and
February 29, 2000 (Unaudited) . . . . . . . . . . . . . . 2

Unaudited Consolidated Statements of Operations for
the Three Months Ended February 29, 2000 and
February 28, 1999 . . . . . . . . . . . . . . . . . . . . 3

Unaudited Consolidated Statements of Operations for
the Nine Months Ended February 29, 2000 and
February 28, 1999 . . . . . . . . . . . . . . . . . . . . 4

Unaudited Consolidated Statements of Cash Flows
for the Nine Months Ended February 29, 2000 and
February 28, 1999 . . . . . . . . . . . . . . . . . . . . 5

Notes to Financial Statements . . . . . . . . . . . . . . . 6

Item 2. Management's Discussion and Analysis . . . . . . . . 6

Part II. Other Information
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Item 6. Exhibits . . . . . . . . . . . . . . . . . . . . . . . 11

BIOQUAL INC. AND SUBSIDIARY
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CONSOLIDATED BALANCE SHEETS, MAY 31, 1999 AND FEBRUARY 29, 2000 (UNAUDITED)
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ASSETS FEBRUARY 29, 2000 MAY 31, 1999
- ------ ----------------- ------------

CURRENT ASSETS:
Cash and cash equivalents $ 71,185 $ 68,768
Accounts receivable:
Trade 1,284,530 966,354
Unbilled - current 241,353 262,774
Other 19,109 26,867
Prepaid expenses 99,057 91,522
Inventories 256,790 287,596
Loans to officers 32,906
Deferred income taxes - current 68,300 77,300
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Total current assets 2,040,324 1,814,087
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FIXED ASSETS:
Leasehold improvements 939,108 832,264
Furniture, fixtures and equipment 3,550,269 3,289,879
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Total 4,489,377 4,122,143
Less accumulated depreciation and amortization 2,872,215 2,649,058
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Fixed assets, net 1,617,162 1,473,085
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DEFERRED INCOME TAXES - NONCURRENT 600,400 600,400
UNBILLED ACCOUNTS RECEIVABLE - NONCURRENT 393,151 493,512
OTHER NONCURRENT ASSETS 242,650 242,650
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TOTAL $ 4,893,687 $ 4,623,734
=========== ===========
LIABILITIES
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CURRENT LIABILITIES:
Borrowings under line of credit $ 825,129 $ 275,282
Current maturities of long-term debt 66,093 66,093
Accounts payable 193,176 215,956
Accrued compensation and related costs 286,622 474,597
Accrued income taxes 24,281
Other accrued liabilities 8,164 15,178
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Total current liabilities 1,379,184 1,071,387
LONG-TERM DEBT 4,658 56,211
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Total liabilities 1,383,842 1,127,598
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STOCKHOLDERS' EQUITY
- --------------------
Convertible preferred stock - par value of $1.00 per share, 500,000 shares authorized; no
shares issued and outstanding
Common stock - par value of $.01 per share; 25,000,000 shares authorized; 1,600,408 shares 16,004 16,004
issued; February 29, 2000, 877,256 shares, May 31, 1999, 872,672 shares outstanding
Additional paid-in capital 7,475,035 7,475,035
Accumulated deficit (3,281,927) (3,310,022)
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Total 4,209,112 4,181,017
Less - treasury stock February 29, 2000, 723,152 shares, May 31, 1999, 727,736 shares, at cost (699,267) (684,881)
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Total stockholders' equity 3,509,845 3,496,136
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TOTAL $ 4,893,687 $ 4,623,734
=========== ===========

See notes to financial statements.

BIOQUAL, INC.AND SUBSIDIARY
- ---------------------------
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE
- -------------------------------------------------------
THREE MONTHS ENDED FEBRUARY 29, 2000 AND FEBRUARY 28, 1999
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FEBRUARY 29, FEBRUARY 28,
2000 1999
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REVENUES AND SALES:
Contract revenues $2,867,429 $2,649,698
Product sales 55,299 35,897
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Total Revenues and Sales 2,922,728 2,685,595
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OPERATING EXPENSES:
Contract 2,272,950 2,102,682
Cost of goods sold 40,892 27,253
Research and development 33,947 54,749
General and administrative 544,550 462,570
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Total 2,892,339 2,647,254
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OPERATING INCOME 30,389 38,341

INTEREST INCOME 1,151 1,147
INTEREST EXPENSE (14,387) (16,067)
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INCOME BEFORE INCOME TAX 17,153 23,421

PROVISION FOR INCOME TAX 7,000 9,400
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NET INCOME $ 10,153 $ 14,021
========== ==========

BASIC EARNINGS PER SHARE $ 0.01 $ 0.02
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DILUTED EARNINGS PER SHARE $ 0.01 $ 0.02
========== ==========
WEIGHTED AVERAGE NUMBER OF SHARES
OUTSTANDING FOR BASIC EARNINGS PER SHARE 872,083 887,739
EFFECT OF DILUTIVE SECURITIES - OPTIONS 9,381 16,225
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WEIGHTED AVERAGE NUMBER OF SHARES
OUTSTANDING PLUS DILUTIVE OPTIONS FOR
DILUTIVE EARNINGS PER SHARE 881,464 903,964
========== ==========

See notes to financial statements.

BIOQUAL, INC.AND SUBSIDIARY
- ---------------------------
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE
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NINE MONTHS ENDED FEBRUARY 29, 2000 AND FEBRUARY 28, 1999
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FEBRUARY 29, FEBRUARY 28,
2000 1999
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REVENUES AND SALES:
Contract revenues $8,564,407 $8,027,867
Product sales 94,809 42,975
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Total Revenues and Sales 8,659,216 8,070,842
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OPERATING EXPENSES:
Contract 6,814,748 6,167,582
Cost of goods sold 76,932 36,643
Research and development 134,818 140,956
General and administrative 1,517,040 1,397,013
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Total 8,543,538 7,742,194
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OPERATING INCOME 115,678 328,648

INTEREST INCOME 2,771 2,788
INTEREST EXPENSE (41,994) (41,471)
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INCOME BEFORE INCOME TAX 76,455 289,965

PROVISION FOR INCOME TAX 31,000 116,000
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NET INCOME $ 45,455 $ 173,965
========== ==========

BASIC EARNINGS PER SHARE $0.05 $0.19
========== ==========
DILUTED EARNINGS PER SHARE $0.05 $0.19
========== ==========
WEIGHTED AVERAGE NUMBER OF SHARES
OUTSTANDING FOR BASIC EARNINGS PER SHARE 870,624 894,714
EFFECT OF DILUTIVE SECURITIES - OPTIONS 9,381 16,225
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WEIGHTED AVERAGE NUMBER OF SHARES
OUTSTANDING PLUS DILUTIVE OPTIONS FOR
DILUTIVE EARNINGS PER SHARE 880,005 910,939
========== ==========

See notes to financial statements.

BIOQUAL, INC. AND SUBSIDIARY
- ----------------------------
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE
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NINE MONTHS ENDED FEBRUARY 29, 2000 AND FEBRUARY 28, 1999
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February 29, February 28,
2000 1999
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CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income $ 45,455 $ 173,965
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Adjustments to reconcile net income to net cash
used for operating activities:
Depreciation and amortization 223,157 235,877
Deferred income taxes 9,000 82,400
Increase in accounts receivable (188,636) (791,217)
Increase in prepaid expenses (7,535) (37,779)
Decrease (increase) in inventories 30,806 (219,765)
Decrease in other assets 38,148
Decrease in accounts payable and accrued expenses (217,769) (85,891)
Common stock gifted to employees 9,392
Decrease in income taxes payable (24,281) (6,376)
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Total Adjustments (165,866) (784,603)
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NET CASH USED FOR OPERATING ACTIVITIES (120,411) (610,638)
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CASH FLOWS USED FOR INVESTING ACTIVITIES:
Capital expenditures (367,234) (183,031)
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NET CASH USED FOR INVESTING ACTIVITIES (367,234) (183,031)
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CASH FLOWS FROM FINANCING ACTIVITIES:
Net proceeds under line-of-credit agreement 549,847 909,914
Net proceeds from exercise of stock options 9,131 81
Dividends paid (17,363)
Principal payments under capital lease obligations (51,553) (113,990)
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NET CASH PROVIDED BY FINANCING ACTIVITIES 490,062 796,005
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NET INCREASE IN CASH AND CASH EQUIVALENTS 2,417 2,336
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 68,768 65,730
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CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 71,185 $ 68,066
========= =========

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION

Cash paid during the period for:
Interest $ 40,857 $ 39,543
========= =========
Income taxes $ 58,725 $ 39,976
========= =========

SUPPLEMENTAL SCHEDULE OF NONCASH INVESTING ACTIVITIES:

Treasury stock received for payment of loans to officer $ 32,906 $ 35,719
========= =========

See notes to financial statements.

NOTES TO FINANCIAL STATEMENTS

Interim Financial Statements
- ----------------------------

In the opinion of management, all adjustments consisting only of normal
recurring accruals necessary for a fair presentation of such amounts have been
included. The results of operations for the quarter and the nine month period
are not necessarily indicative of results for the year.

Inventories
- -----------

Inventories are stated at the lower of cost or market using the average cost
method.

Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS

Summary Analysis
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In this third quarter of fiscal year 2000, BIOQUAL (hereinafter, "the Company"
or "BIOQUAL") realized net income of $10,153. Net income for the first nine
months of fiscal year 2000 totaled $45,455.

On December 31, 1999, Diagnon Corporation ("Diagnon") changed its name to
BIOQUAL, Inc. The name change was effected as a result of the merger of Diagnon
and its wholly owned subsidiary, BIOQUAL, Inc., with Diagnon being the surviving
corporation. In the merger Diagnon adopted the name BIOQUAL, Inc. as the name
of the surviving entity. The business and operations of BIOQUAL, Inc. will be
the same as the consolidated business and operations of Diagnon together with
its wholly owned subsidiaries prior to the merger.

During the third quarter the following developments occurred:

. On December 28, 1999, BIOQUAL renewed its contract to support hepatitis
researchers at the National Institute of Allergy and Infectious Diseases
(NIAID). The contract entitled "Care and Housing of Hepatitis Research
Animals" totals $13,634,742 and extends for seven years to December 2006.

. On January 28, 2000, BIOQUAL renewed its contract to support AIDS
researchers at the NIAID. The contract entitled "Care and Housing of AIDS
Research Animals" totals $10,798,411 and extends for seven years to
January 2007.

. On February 29, 2000, the Company renewed its contract to support
infectious disease researchers at the NIAID. The contract entitled
"Facility for Animals Used in Infectious Disease Research" totals
$6,298,647 and extends for seven years to February 2007.

Subsequent to the end of the quarter the following developments occurred:

. On March 2, 2000, the Company was awarded a $99,153 Phase I grant from the
National Institutes of Health as part of its Small Business Innovation
Research (SBIR) program. The six month grant

is to identify and characterize DNA sequence variation in chimpanzees at
four genes that contain mutations implicated in the pathogenesis of
Alzheimer's Disease.

. The NIAID contract, "MAO/Evaluation of AIDS Vaccines in Non-Human
Primates" expired on March 31, 2000. This contract accounts for
approximately 1% of the Company's projected revenues for fiscal year 2000.
The expiration of this contract will have minimal effect on the Company's
revenues and operating capital.

Year 2000
- ---------

The Company performed an internal assessment of the scope of the Year 2000
computer systems and software problems and its potential effect on the operation
of the Company. The Company continues to monitor its information and non-
information systems for signs of malfunction due to the Year 2000 computer
problem. The Company has not encountered any delays of service or non-service
from its major suppliers of products and services, however there can be no
assurance that the Company will not be affected by another company's Year 2000
non-compliance. The Company spent approximately $20,000 in fiscal year 1999 and
approximately $23,000 to date in fiscal year 2000 to replace non-compliant
computers and software. Any costs incurred in connection with Year 2000
compliance were expensed as incurred. It is the opinion of management that the
Year 2000 computer problem will not have a material effect on the Company's
operation. However, the Company continues to monitor the status of its largest
customer, the National Institutes of Health (NIH), regarding Year 2000
compliance. The NIH states that all of its mission critical systems and 98% of
its non-mission critical systems are currently compliant. However, if the NIH
does experience Year 2000 related problems, the Company's financial condition
may be adversely affected until such time that the NIH's non-compliant
contingency plan is initiated.

Not all instances of date failure can be anticipated or controlled. In planning
for the most reasonably likely worst-case scenario, (e.g. NIH systems being non-
compliant after January 1, 2000), or in cases which, despite our efforts,
failures occur, we have developed a contingency plan. The contingency plan
includes the stockpiling of critical materials necessary to maintain operations.

Results of Operations
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Three Months Comparison
- -----------------------

For the three months of operations ended February 29, 2000 (the Company's third
quarter in fiscal year 2000), contract revenues increased by 8.2% or $217,731 to
$2,867,429 compared to $2,649,698 in the third quarter of fiscal year 1999.
This increase was due to increased government contract activity including
approximately $69,000 in costs incurred related to a toxicity study which began
this quarter. However, the increase is not as large as anticipated due to a
decrease in the number of commercial contracts compared to the third quarter of
fiscal year 1999 and the expiration of a major contract on November 8, 1998.
Product sales increased to $55,299 for the quarter ended February 29, 2000
compared to $35,897 for the same quarter in fiscal year 1999.

Contract operating expenses increased 8.1% or $170,268 compared to the third
quarter of fiscal year 1999 primarily due to increased government contract
activity (including the $69,000 in costs incurred related to a toxicity study as
mentioned above), an increase in overhead expenses supporting the equine
production facility of approximately $35,000 compared to the third quarter in
fiscal year 1999, offset by the decrease in commercial contracts. Cost of goods
sold increased to $40,892 from $27,253 in the third quarter of fiscal year 1999.
This increase was primarily due to the increase in units sold during this fiscal
year. Research and development (R&D) expenses decreased to $33,947 compared to
$54,749 in the third quarter of fiscal year 1999. This decrease is primarily due
to the temporary reassignment of R&D staff to prepare Small Business Innovative
Research (SBIR) grant proposals to possibly provide additional funding for the
research associated with the high throughput assay system currently being
developed by the Company's Department of Discovery Research. General and
administrative expenses increased 17.7% compared to the third quarter of fiscal
year 1999 primarily due to inflationary increases in several items of expense
plus the increased costs associated with the preparation of the SBIR grant
proposals this quarter compared to fiscal year 1999. Total operating expenses
increased 9.3% due to the above.

Operating income decreased to $30,389 for the third quarter of fiscal year 2000
compared to $38,341 in the same quarter in the prior year. The decrease is
primarily due to the following factors: 1) the increase in contract expenses
without a comparative increase in related contract revenues resulting in a
decrease in the gross margin percentage on contracts this fiscal year, 2) the
increase in overhead expenses supporting the equine production facility of
approximately $35,000, offset by 3) the increase in government contract
activity.

For this quarter, the Company had interest expense of $14,387 compared to
interest expense of $16,067 in the prior year.

In accordance with SFAS No. 109, "Accounting for Income Taxes", the Company
reported a deferred federal income tax expense of $4,000 for the three months
ended February 29, 2000. The Company made a provision for state income tax
which is estimated at $3,000. State income tax expense is reimbursable under
government contracting regulations.

Earnings Per Share (EPS) - For the three month comparison, options to purchase
29,502 shares of common stock at prices ranging from $2.8875 per share to $3.375
per share were outstanding on February 29, 2000 but were not included in the
computation of diluted EPS because the option exercise prices were greater than
the market price of the common shares. Options to purchase 59,345 shares of
common stock at prices ranging from $1.80 per share to $3.375 per share were
outstanding on February 28, 1999 but were not included in the computation of
diluted EPS because the option exercise prices were greater than the market
price of the common shares.

Nine Month Comparison
- ---------------------

For the nine months of operations ended February 29, 2000, contract revenues
increased by 6.7% or $536,540 to $8,564,407 compared to $8,027,867 for the first
nine months of fiscal year 1999. This increase was due to increased government
contract activity including two one-time

purchases totaling approximately $210,000 during the second quarter of this
fiscal year and $69,000 in costs incurred related to a toxicity study which
began during the third quarter of this fiscal year. However, the increase is not
as large as anticipated due to a decrease in the number of commercial contracts
compared to the first nine months of fiscal year 1999, the end of a major
contract on November 8, 1998, the fiscal year 1999 funding of a $34,976 indirect
rate variance cost overrun of a contract that expired in fiscal year 1995 (the
contract was administratively closed out on September 30, 1998), and a fiscal
year 2000 reserve for a $50,000 cost overrun, due to indirect cost variances, on
a contract that expired on December 27, 1999. Product sales increased to $94,809
for the nine month period ending February 29, 2000 compared to $42,975 for the
same period in fiscal year 1999. Contract operating expenses increased 10.5% or
$647,166 compared to the first nine months of fiscal year 1999 primarily due to
increased government contract activity (including the two one-time purchases
totaling approximately $210,000 and the $69,000 toxicity study mentioned above),
an increase in overhead expenses supporting the equine production facility of
approximately $95,000 compared to the first nine months in fiscal year 1999,
offset by the decrease in commercial contracts. Cost of goods sold increased to
$76,932 from $36,643 in the first nine months of fiscal year 1999. This increase
was primarily due to the increase in units sold during this fiscal year and the
expensing of 22 free doses of Eqstend. Research and development (R&D) expenses
decreased to $134,818 compared to $140,956 in the first nine months of fiscal
year 1999. This decrease is primarily due to the temporary reassignment of R&D
staff (during the third quarter of fiscal year 2000) to prepare Small Business
Innovative Research (SBIR) grant proposals to possibly provide additional
funding for the research associated with the high throughput assay system
currently being developed by the Company's Department of Discovery Research as
previously mentioned. General and administrative expenses increased 8.6%
compared to the first nine months of fiscal year 1999 primarily due to
inflationary increases in several items of expense plus the increased costs
associated with the preparation of the SBIR grant proposals during the third
quarter of fiscal year 2000 compared to fiscal year 1999, offset by a decrease
in legal expenses during this year compared to fiscal year 1999. Total operating
expenses increased 10.4% due to the above.

Operating income decreased to $115,678 for the nine month period ending February
29, 2000 compared to $328,648 for the same period in the prior year. The
decrease is primarily due to several factors: 1) the increase in contract
expenses without a comparative increase in related contract revenues resulting
in a decrease in the gross margin percentage on contracts this fiscal year, 2)
the increase in overhead expenses supporting the equine production facility of
approximately $95,000, 3) the reserve for a $50,000 cost overrun, due to
indirect cost variances, on a contract that ended on December 27, 1999 and 4)
$34,976 increased funding to cover an indirect cost overrun for an expired
contract during the previous fiscal year as mentioned above.

For the nine months of this fiscal year, the Company had interest expense of
$41,994 compared to interest expense of $41,471 in the prior year.

In accordance with SFAS No. 109, "Accounting for Income Taxes", the Company
reported a deferred federal income tax expense of $9,000 for the nine months
ended February 29, 2000. The Company made a provision for state income tax
which is estimated at $22,000. State income tax expense is reimbursable under
government contracting regulations.

Earnings Per Share (EPS) - For the nine month comparison, options to purchase
29,502 shares of common stock at prices ranging from $2.8875 per share to $3.375
per share were outstanding on February 29, 2000 but were not included in the
computation of diluted EPS because the option exercise prices were greater than
the market price of the common shares. Options to purchase 59,345 shares of
common stock at prices ranging from $1.80 per share to $3.375 per share were
outstanding on February 28, 1999 but were not included in the computation of
diluted EPS because the option exercise prices were greater than the market
price of the common shares.

Liquidity and Capital Resources
- -------------------------------

Assets

The changes in cash and cash equivalents are detailed in the Statements of
Consolidated Cash Flows on page 5. Total assets increased $269,953 from
$4,623,734 at May 31, 1999 to $4,893,687 at February 29, 2000. This amount was
primarily attributable to an increase in accounts receivable of $188,636
consisting mainly of 1) an increase of $318,176 in trade accounts receivable
reflecting a slower collection rate compared to the previous fiscal year end, 2)
a $121,782 net decrease in unbilled accounts receivable (current plus
noncurrent) primarily resulting from a $1,427 increase in reimbursable indirect
rate variances for the current fiscal year, a net $92,976 decrease in month end
accrued sales on accrued direct labor comparing the current period and the
accrual at the end of fiscal year 1999, the recording of $19,767 unbilled
contract fee retention to be billed at the completion of the respective
contracts, and a $50,000 reserve for a cost overrun, due to indirect rate
variances from prior years, on a contract that expired on December 27, 1999, and
3) a $7,758 decrease in other accounts receivable. Prepaid expenses increased
$7,535 primarily due to the prepayment of life insurance premiums. Fixed
assets, net of accumulated depreciation and amortization increased $144,077
reflecting fixed asset purchases of $367,234 (mainly nonhuman primate
enclosures, lab equipment, and facility improvements) offset by depreciation and
amortization of $223,157.

The above increase is partially offset by 1) a decrease in loans to officers of
$32,906 due to payments made during the this fiscal year, 2) a deferred income
tax decrease of $9,000 primarily as a result of utilizing a portion of the
federal income tax loss carryforward, and 3) a $30,806 decrease to inventories.
The balance of the increase was due to other miscellaneous factors.

Liabilities

In the first nine months of operations, total liabilities increased $256,244
from $1,127,598 at May 31, 1999 to $1,383,842 at February 29, 2000. This
increase is primarily attributable to an increase to borrowings under line-of-
credit of $549,847 reflecting the slow

collection of trade accounts receivable and the payment of accrued bonuses from
the previous fiscal year.

The above increase is partially offset by 1) a decrease in accrued compensation
and related costs of $187,975 reflecting the payment of accrued bonuses from
fiscal year 1999 during the first quarter of this fiscal year and a shorter
accrual period at the end of the quarter compared to the prior fiscal year end.
2) payments totaling $51,553 on capital leases reducing long-term debt, 3) a
decrease in accrued income taxes of $24,281, 4) a decrease in accounts payable
of $22,780, and 5) a decrease in other accrued liabilities of $7,014. The
balance of the increase was due to other miscellaneous factors.

Stockholders' Equity

During the second quarter the company paid a cash dividend totaling $17,363 to
shareholders of record as of September 7, 1999.

Capital Resources

The Company believes it has sufficient cash and financing sources to provide for
its ongoing operations and the Company continues to believe that the impact of
inflation, or the absence of it, will have no significant effect on its
operations.

Forward Looking Information

Statements herein that are not descriptions of historical facts are forward
looking and subject to risk and uncertainties. Actual results could differ
materially from those currently anticipated due to a number of factors including
those set forth in BIOQUAL's Securities and Exchange Commission filings under
"Risk Factors", including risks relating to the early stage of products under
development; uncertainties relating to clinical trials; dependence on third
parties' future capital needs; and risks relating to the commercialization, if
any, of BIOQUAL's proposed products (such as marketing, safety, regulatory,
patent, product liability, supply, competition and other risks).

Item 4. EXHIBITS

Exhibits filed
--------------

(10) Government Contracts.
--------------------

1. Title: Care and Housing of Hepatitis Research Animals.
Institute: National Institute of Allergy and Infectious Diseases
Dates Funded: 12/28/99 - 12/27/06

2. Title: Care and Housing of AIDS Research Animals.
Institute: National Institute of Allergy and Infectious Diseases
Dates Funded: 2/1/00 - 1/31/07

3. Title: Facility for Animals Used in Infectious Disease
Research.
Institute: National Institute of Allergy and Infectious Diseases
Dates Funded: 3/1/00 - 2/28/07

SIGNATURES
----------

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

BIOQUAL, Inc.

DATE April 13, 2000 /s/ John C. Landon
-------------------- --------------------------------
Chairman of the Board,
President and Chief Executive
Officer

DATE April 13, 2000 /s/ Michael P. O'Flaherty
-------------------- --------------------------------
Chief Operating Officer and
Secretary

DATE April 13, 2000 /s/ David A. Newcomer
-------------------- --------------------------------
Chief Financial Officer