As filed with the Securities and Exchange Commission on August ___, 2001

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM SB-2

Registration Statement Under
THE SECURITIES ACT OF 1933

L.A.M. PHARMACEUTICAL, CORP.
---- -----------------------------
(Exact name of registrant as specified in charter)

Delaware 2834 52-2278236
(State or other jurisdiction (Primary Standard Classi- (IRS Employer
of incorporation) fication Code Number) I.D. Number)

800 Sheppard Avenue West, Commercial Unit 1
Toronto, Ontario, Canada M3H 6B4
(877) 526-7717 or (416) 633-7047
--------- ---------------------------------
(Address and telephone number of principal executive offices)

800 Sheppard Avenue West, Commercial Unit 1
Toronto, Ontario, Canada M3H 6B4
(877) 526-7717 or (416) 633-7047
--------- ---------------------------------

(Address of principal place of business or intended principal place of business)

Joseph T. Slechta
800 Sheppard Avenue West, Commercial Unit 1
Toronto, Ontario, Canada M3H 6B4
(877) 526-7717 or (416) 633-7047
--------- ---------------------------------
(Name, address and telephone number of agent for service)

Copies of all communications, including all communications sent
to the agent for service, should be sent to:

William T. Hart, Esq.
Hart & Trinen
1624 Washington Street
Denver, Colorado 80203
303-839-0061

APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
As soon as practicable after the effective date of this Registration Statement

If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]

If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]

If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]

CALCULATION OF REGISTRATION FEE
==============================================================================

Title of each Proposed Proposed
Class of Maximum Maximum
Securities Securities Offering Aggregate Amount of
to be to be Price Per Offering Registration
Registered Registered Unit (1) Price Fee
- ---------- ---------- ---------- --------- --------------

Common stock (2) 3,161,000 $ 0.67 $2,117,870 $530
- ------------------------------------------------------------------------------

(1) Offering price computed in accordance with Rule 457(c).
(2) Shares of common stock offered by selling stockholders.

The registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the registrant shall
file a further amendment which specific.

ally states that this Registration Statement shall thereafter become
effective in accordance with Section 8(a) of the Securities Act of l933 or until
the Registration Statement shall become effective on such date as the
Commission, acting pursuant to said Section 8(a), may determine.

PROSPECTUS

L.A.M. PHARMACEUTICAL, CORP.

Common Stock

By means of this prospectus certain shareholders of L.A.M. Pharmaceutical,
Corp. are offering to sell up to 1,831,000 shares of common stock.

L.A.M. will not receive any proceeds from the sale of the common stock by
the selling stockholders. L.A.M. will pay for the expenses of this offering.

L.A.M.'s common stock is quoted on the OTC Bulletin Board under the symbol
"LAMP." On August 27, 2001 the closing bid price for one share of L.A.M.'s
common stock was $0.67.

All dollar amounts refer to US dollars unless otherwise indicated.

Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or passed upon the
accuracy or adequacy of this prospectus. Any representation to the contrary is a
criminal offense.

These securities are speculative and involve a high degree of risk. For a
description of certain important factors that should be considered by
prospective investors, see "Risk Factors" beginning on page ___ of this
Prospectus

The date of this prospectus is August ___, 2001

PROSPECTUS SUMMARY

L.A.M. Pharmaceutical, Corp. was incorporated in Delaware in July 1998. In
September 1998 L.A.M. acquired all of the issued and outstanding shares of LAM
Pharmaceuticals LLC for 6,000,000 shares of L.A.M.'s common stock. LAM
Pharmaceuticals LLC was organized in Florida in 1994 (initially as a
partnership) to commercialize a new drug delivery system which offers patients,
among other benefits, safer and more effective treatment for a number of serious
diseases. Unless otherwise indicated, all references to L.A.M. include LAM
Pharmaceuticals LLC.

The objective of L.A.M. is to develop, license, produce and sell novel and
proprietary pharmaceuticals. Notwithstanding the above, L.A.M. has not obtained
U.S. Food and Drug Administration (FDA) approval for any of its products.

L.A.M. is the owner of a proprietary drug delivery technology that involves
the use of an original Ionic Polymer Matrix (IPM) for the purpose of delivering,
enhancing and sustaining the action of certain established therapeutic agents.

The IPM technology is not a drug in and of itself, but rather a new system
for carrying, delivering and releasing drugs in a manner that can extend and/or
improve their efficacy and safety.

L.A.M.'s executive offices are located 800 Sheppard Avenue West,
Commercial Unit 1, Toronto, Ontario, Canada M3H 6B4. L.A.M.'s telephone number
is (877) 526-7717 or (416) 633-3004 and its fax number is (416) 633-7047.

The Offering

By means of this prospectus certain shareholders are offering to sell up to
1,831,000 shares of the common stock of L.A.M. L.A.M. refers to the owners of
these shares as the selling shareholders in this prospectus.

Common Stock Outstanding: As of August 15, 2001, L.A.M. had 15,148,284 shares
of common stock issued and outstanding. The number
of outstanding shares does not give effect to shares
which may be issued upon the exercise and/or
conversion of options, warrants or in accordance
with certain agreements between L.A.M. and third
parties. See "Comparative Share Data".

Risk Factors: The purchase of the securities offered by
this prospectus involves a high degree of risk. Risk
factors include the lack of revenues and history of
loss, and the need for additional capital. See the
"Risk Factors" section of this prospectus for
additional Risk Factors.

OTC Bulletin Board Symbol: LAMP

Summary Financial Data

The financial data presented below should be read in conjunction with the
more detailed financial statements and related notes which are included
elsewhere in this prospectus along with the section entitled "Management's
Discussion and Analysis and Plan of Operations."

Results of Operations:

Year Ended Six Months Ended
December 31, 2000 June 30, 2001

Revenue $ -- $300,000
Operating Expenses (4,805,269) (2,903,892)
Interest Income 28,261 21,464
------------ -----------
Net Loss $(4,777,008) $(2,582,428)
============ ============

Balance Sheet Data:
December 31, 2000 June 30, 2001

Current Assets $2,101,706 $2,049,169
Total Assets 2,457,503 2,481,272
Current Liabilities 1,985,012 1,942,591
Total Liabilities 3,459,209 3,391,788
Working Capital 116,694 106,578
Stockholders' (Deficit) (1,001,706) (910,516)

Forward Looking Statements

This prospectus contains various forward-looking statements that are based
on L.A.M. beliefs as well as assumptions made by and information currently
available to L.A.M. When used in this prospectus, the words "believe", "expect",
"anticipate", "estimate" and similar expressions are intended to identify
forward-looking statements. Such statements may include statements regarding
seeking business opportunities, payment of operating expenses, and the like, and
are subject to certain risks, uncertainties and assumptions which could cause
actual results to differ materially from projections or estimates. Factors which
could cause actual results to differ materially are discussed at length under
the heading "Risk Factors". Should one or more of the enumerated risks or
uncertainties materialize, or should underlying assumptions prove incorrect,

actual results may vary materially from those anticipated, estimated or
projected. Investors should not place undue reliance on forward-looking
statements, all of which speak only as of the date made.

RISK FACTORS

The securities being offered hereby are highly speculative and prospective
investors should consider, among others, the following factors related to the
business, operations and financial position of L.A.M.

If L.A.M. fails to obtain regulatory approvals for its products, L.A.M. will be
prevented from marketing its products and will incur substantial losses: The
pre-clinical and clinical testing, manufacturing, and marketing of L.A.M.'s drug
delivery systems is subject to extensive regulation by numerous governmental
authorities in the United States and in other countries, including, but not
limited to, the United States Food and Drug Administration. Among other
requirements, FDA approval of L.A.M.'s drug delivery systems, including a review
of the manufacturing processes and facilities used to produce L.A.M.'s drug
delivery products, will be required before these products may be marketed in the
United States. There can be no assurance that L.A.M.'s manufacturing facilities
will be accepted by the FDA. Similarly, marketing approval by a foreign
governmental authority is typically required before L.A.M.'s drug delivery
systems may be marketed in a particular foreign country.

L.A.M. does not have any products approved by the FDA or any foreign
authority and does not expect to be profitable unless its drug delivery products
now under development receive FDA or foreign regulatory approval and are
commercialized successfully. In order to obtain FDA approval of a product L.A.M.
must demonstrate to the satisfaction of the FDA that the product is safe and
effective for its intended uses and that L.A.M. is capable of manufacturing the
product with procedures that conform to the FDA's regulations, which must be
followed at all times. Management of L.A.M. has limited experience in submitting
and pursuing FDA regulatory applications. The process of obtaining FDA approvals
can be costly, time consuming, and subject to unanticipated delay. There can be
no assurance that any approvals will be granted to L.A.M. on a timely basis, or
at all.

In addition to delays in review and approval of pre-clinical and clinical
testing, delays or rejection may also be encountered based upon changes in
applicable law or regulatory policy during the period of product development and
FDA regulatory review. Any failure to obtain, or any delay in obtaining, FDA
approvals would adversely affect the ability of L.A.M. to market its products.
Moreover, even if FDA approval is granted, any approval may include significant
limitations on indicated uses for which a product could be marketed.

Both before and after approval is obtained, a product and its manufacturer
are subject to comprehensive regulatory oversight. Violations of regulatory
requirements at any stage, including the pre-clinical and clinical testing
process, the approval process, or thereafter (including after approval), may
result in adverse consequences, including the FDA's delay in approving or
refusal to approve a product, withdrawal of an approved product from the market,
and/or the imposition of criminal penalties against the manufacturer. In

addition, later discovery of previously unknown problems relating to a marketed
product may result in restrictions on such product or manufacturer including
withdrawal of the product from the market. Also, new government requirements may
be established that could delay or prevent regulatory approval of L.A.M.'s
products under development.

If cost estimates for clinical trials and research are inaccurate, L.A.M. will
require additional funding. L.A.M.'s estimates of the costs associated with
future clinical trials and research may be substantially lower than the actual
costs of these activities. If L.A.M.'s cost estimates are incorrect, L.A.M. will
need additional funding for its research efforts.

There can be no assurance that L.A.M. will achieve or maintain a competitive
position or that other technological developments will not cause L.A.M.'s
proprietary technologies to become uneconomical or obsolete. The biomedical
field in which L.A.M. is involved is undergoing rapid and significant
technological change. The successful development of therapeutic agents and
products will depend on L.A.M.'s ability to be in the technological forefront of
this field. There can be no assurance that L.A.M. will achieve or maintain a
competitive position or that other technological developments will not cause
L.A.M.'s proprietary technologies to become uneconomical or obsolete.

L.A.M.'s patents might not protect L.A.M.'s technology from competitors. Certain
aspects of L.A.M.'s technologies are covered by U.S. patents. In addition,
L.A.M. has a number of patent applications pending. There is no assurance that
the applications still pending or which may be filed in the future will result
in the issuance of any patents. Furthermore, there is no assurance as to the
breadth and degree of protection any issued patents might afford L.A.M. Disputes
may arise between L.A.M. and others as to the scope, validity and ownership
rights of these or other patents. Any defense of the patents could prove costly
and time consuming and there can be no assurance that L.A.M. will be in a
position, or will deem it advisable, to carry on such a defense. Other private
and public concerns may have filed applications for, or may have been issued,
patents and are expected to obtain additional patents and other proprietary
rights to technology potentially useful or necessary to L.A.M. The scope and
validity of such patents, if any are presently unknown. Also, as far as L.A.M.
relies upon unpatented proprietary technology, there is no assurance that others
may not acquire or independently develop the same or similar technology.

L.A.M. has a history of losses and may never be profitable. L.A.M. has never
earned a profit. As of June 30, 2001 L.A.M.'s accumulated deficit was
approximately $(12,398,000). L.A.M. expects to incur additional losses during
the forseeable future. No assurance can be given that L.A.M.'s product
development efforts will be completed, that regulatory approvals will be
obtained, that L.A.M.'s drug delivery systems will be manufactured and marketed
successfully, or that L.A.M. will ever earn a profit.

If L.A.M. cannot obtain additional capital, L.A.M. may have to delay or postpone
development and research expenditures which may influence L.A.M.'s ability to
produce a timely and competitive product. This offering is being made on behalf

of certain selling shareholders. L.A.M. will not receive any proceeds from the
sale of the shares offered by the selling shareholders. Clinical and other
studies necessary to obtain approval of a new drug can be time consuming and
costly. The different steps necessary to obtain regulatory approval, especially
that of the FDA, involve significant costs. Accordingly, L.A.M. will need
additional capital in order to fund the costs of future clinical trials, related
research, and general and administrative expenses. L.A.M. may be forced to delay
or postpone development and research expenditures if L.A.M. is unable to secure
adequate sources of funds. These delays in development would have an adverse
effect on L.A.M.'s ability to produce timely and competitive products. There can
be no assurance that L.A.M. will be able to obtain the funding which it will
require.

L.A.M. may sell shares of its common stock in the future, including shares
issued pursuant to the equity line of credit, and these sales may dilute the
interests of other security holders and depress the price of L.A.M.'s common
stock. As of August 15, 2001, L.A.M had 15,148,284 outstanding shares of common
stock. As of August 15, 2001, there were outstanding options, warrants and
convertible notes which would allow the holders of these securities to purchase
approximately 11,168,438 additional shares of L.A.M.'s common stock. Additional
shares of common stock are issuable under the equity line of credit and upon the
exercise of warrants held by Hockbury Limited and GKN Securities. L.A.M. may
also issue additional shares for various reasons and may grant additional stock
options to its employees, officers, directors and third parties. See "
Comparative Share Data".

The issuance or even the potential issuance of shares upon the exercise of
warrants, options, the conversion of promissory notes, under the equity line of
credit or in connection with any other financing will have a dilutive impact on
other stockholders and could have a negative effect on the market price of
L.A.M.'s common stock. In addition, the shares issuable to Hockbury Limited
under the equity line of credit will be issued at a discount to the daily volume
weighted average prices of L.A.M.'s common stock during the 22 trading days
prior to issuance.

As L.A.M. issues shares of its common stock as a result of the exercise of
options or warrants, or as L.A.M. sells shares of its common stock under the
equity line of credit, the price of L.A.M.'s common stock may decrease due to
the additional shares in the market. If L.A.M. decides to draw down on the
equity line of credit as the price of its common stock decreases, L.A.M. will be
required to issue more shares of its common stock for any given dollar amount
invested by Hockbury Limited, subject to the minimum selling price specified by
L.A.M. The more shares that are issued as a result of the exercise of warrants
or options or under the equity line of credit, the more L.A.M.'s then
outstanding shares will be diluted and the more L.A.M.'s stock price may
decrease. Any decline in the price of L.A.M.'s common stock may encourage short
sales, which could place further downward pressure on the price of L.A.M.'s
common stock.

There is, at present, only a limited market for L.A.M.'s common stock and there
is no assurance that this market will continue. L.A.M.'s common stock is traded
on the OTC Bulletin Board. Trades of L.A.M.'s common stock are subject to Rule
15g-9 of the Securities and Exchange Commission, which rule imposes certain
requirements on broker/dealers who sell securities subject to the rule to
persons other than established customers and accredited investors. For

transactions covered by the rule, brokers/dealers must make a special
suitability determination for purchasers of the securities and receive the
purchaser's written agreement to the transaction prior to sale. The Securities
and Exchange Commission also has rules that regulate broker/dealer practices in
connection with transactions in "penny stocks". Penny stocks generally are
equity securities with a price of less than $5.00 (other than securities
registered on certain national securities exchanges or quoted on the NASDAQ
system, provided that current price and volume information with respect to
transactions in that security is provided by the exchange or system). 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 prepared by the Commission that 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.
These disclosure requirements have the effect of reducing the level of trading
activity in the secondary market for L.A.M.'s common stock. As a result of these
rules, investors may find it difficult to sell their shares.

COMPARATIVE SHARE DATA

As of August 15, 2001, L.A.M. had 15,148,284 outstanding shares of common
stock. The following table illustrates the comparative stock ownership of the
present shareholders of L.A.M., as compared to the investors in this offering,
assuming all shares offered by the selling shareholders are sold.

Number of Note
Shares Reference

Shares outstanding as of August 15, 2001 15,148,284

Shares offered by this prospectus:

Shares owned by selling shareholder 100,000

Shares issuable upon exercise of options or
warrants held by selling shareholders 3,061,000 A, B and C

The number of shares outstanding as of August 15, 2001 excludes shares
which may be issued upon the exercise and/or conversion of other options,
warrants and convertible notes issued by L.A.M. See the table below for further
information.

Investors in this offering will suffer immediate dilution since the price
paid for the securities offered will likely be more then the net tangible book
value of L.A.M.'s common stock.

Net tangible book value is calculated by dividing L.A.M.'s total assets, less
intangible assets and liabilities, and dividing it by the number of outstanding
shares of common stock.

The actual dilution to investors in this offering will depend on the price
paid for the shares and L.A.M.'s net book value at the time of purchase.

Other Shares Which May Be Issued:
- --------------------------------

The following table lists additional shares of L.A.M.'s common stock which
may be issued as the result of the exercise of outstanding options, warrants or
convertible notes:

Number of Note
Shares Reference

Shares issuable upon exercise of options issued
to private investors. 450,000 A

Shares issuable upon exercise of options granted to
L.A.M.'s officers, directors, and employees. 4,700,000 C

Shares issuable upon conversion of promissory
notes and exercise of warrants. 2,957,438 D

Shares issuable in connection with Equity Not known
Line of Credit at this time E

Shares issuable upon the exercise of warrants
which were issued as part of the Equity
Line of Credit. 938,473 E

A. Options to purchase 1,925,000 shares of common stock are exercisable at
prices between $0.58 and $4.00 and expire between September 2001 and April
2007.

B. Options to purchase 1,416,000 shares of common stock were granted to
certain persons that provide financial and research consulting services to
L.A.M. Options are exercisable at prices between $0.65 and $4.04 and
expire between September 2001 and October 2004.

C. Options to purchase 4,870,000 shares of common stock are exercisable at
prices between $0.58 to $3.50 per share and expire between September 2002
and June 2011.

D. Between July 1999 and December 2000 L.A.M. sold convertible notes in the
principal amount of $3,658,333 to various private investors. The notes bear
interest at an annual non-compound rate of 9.5% and are due and payable between
January and November 2001. Under the original terms of the notes, at the option
of the note holder the amount due on the note, excluding accrued interest, could
be converted into shares of L.A.M.'s common stock. The number of shares to be

issued upon the conversion of the notes was determined by dividing the amount of
the note by the Conversion Price, which varied between $0.50 and $4.00. As of
August 15, 2001 notes in the principal amount of $2,267,083 had been converted
into 3,442,763 shares of L.A.M.'s common stock, and notes in the principal
amount of $21,500 had been repaid. On August 9, 2001, the conversion term for
all notes then outstanding were revised. The number of shares to be issued upon
the conversion of the notes, plus any accrued interest, will now be determined
by dividing the amount to be converted by $0.52. Noteholders who convert on
these revised terms will also be granted options to purchase shares of L.A.M.'s
common stock equal to 10% of the number of shares resulting from the conversion.
Each option allows the holder to purchase one additional share of L.A.M.'s
common stock at a price of $0.58 per share at any time during the one year
period following conversion. If all outstanding notes were converted, the note
holders would receive 2,688,580 shares of L.A.M.'s common stock plus options to
purchase 268,858 additional shares.

E. On January 24, 2001, L.A.M. entered into an equity line of credit agreement
with Hockbury Limited in order to establish a possible source of funding for the
development of L.A.M.'s technology. The equity line of credit agreement
establishes what is sometimes also referred to as an equity drawdown facility.

Under the equity line of credit agreement, Hockbury Limited has agreed to
provide L.A.M. with up to $20,000,000 of funding during the twenty-month period
ending. During this period, L.A.M. may request a drawdown under the equity line
of credit by selling shares of its common stock to Hockbury Limited, and
Hockbury Limited will be obligated to purchase the shares. L.A.M. may request a
drawdown once every 27 trading days, although L.A.M. is under no obligation to
request any drawdowns under the equity line of credit.

During the 22 trading days following a drawdown request, L.A.M. will
calculate the amount of shares it will sell to Hockbury Limited and the purchase
price per share. The purchase price per share of common stock will based on the
daily volume weighted average price of L.A.M.'s common stock during each of the
22 trading days immediately following the drawdown date, less a discount of 10%.
L.A.M. will receive the purchase price less a placement fee payable to GKN
Securities equal to 7% of the aggregate purchase price. Hockbury Limited may
then resell all or a portion of these shares in the public market. GKN
Securities is the placement agent which introduced Hockbury Limited to L.A.M.
and is a registered broker-dealer.

L.A.M. may request a drawdown by sending a drawdown notice to Hockbury
Limited, stating the amount of the drawdown and the lowest daily volume weighted
average price, if any, at which L.A.M. is willing to sell the shares. The
minimum volume weighted average price will be set by L.A.M.'s President in his
sole and absolute discretion. If L.A.M. sets a minimum price which is too high
and L.A.M.'s stock price does not consistently meet that level during the 22
trading days after its drawdown request, the amount L.A.M. can draw and the
number of shares L.A.M. will sell to Hockbury Limited will be reduced. On the
other hand, if L.A.M. sets a minimum price which is too low and its stock price
falls significantly but stays above the minimum price, L.A.M. will have to issue
a greater number of shares to Hockbury Limited based on the reduced market
price.

The following provides certain information concerning the first two
drawdowns requested by L.A.M.

Date of Date of Shares Average Sale Net Proceeds
Request Sale Sold Price Per Share to L.A.M.
---------- ------------- ----- --------------- -----------------

3-3-01 4-25-01 19,016 $4.16 $70,018
5-7-01 6-07-01 420,005 $0.90 $378,764

The proceeds to L.A.M. are net of the placement agent fee paid to GKN
Securities.

As consideration for extending the equity line of credit, L.A.M. granted
Hockbury Limited warrants to purchase 482,893 shares of common stock at a price
of $4.56 per share at any time prior to January 24, 2004. As partial
consideration for GKN Securities' services L.A.M. granted GKN Securities
warrants to purchase 455,580 shares of common stock at a price of $4.83 per
share at any time prior to January 24, 2006. Warrants to purchase 209,500 shares
were subsequently assigned to four employees of GKN Securities.

Shares Registered for Public Sale

A total of 3,061,000 shares issuable upon the exercise of options and
warrants, and which are referred to in Notes A, B and C are being registered for
public sale by means of this prospectus. See "Selling Shareholders".

A total of 4,500,000 shares issuable upon the exercise of options, and
which are referred to in Note C, have been registered for public sale by means
of a registration statement on Form S-8 filed with the Securities and Exchange
Commission.

The shares which may be sold under the equity line of credit, and which
are referred to in Note E, have been registered for public sale by means of a
separate registration statement filed with the Securities and Exchange
Commission.

Market for Common STOCK.

As of August 15, 2001, there were 154 record owners of L.A.M.'s common
stock. L.A.M.'s common stock is traded in the over-the-counter market under the
symbol "LAMP". Set forth below are the range of high and low bid quotations for
the periods indicated as reported by the National Quotation Bureau. The market
quotations reflect interdealer prices, without retail mark-up, mark-down or
commissions and may not necessarily represent actual transactions. L.A.M.'s
common stock began trading in August 1999.

Quarter Ending High Low

9/30/99 $ 1.38 $0.60
12/31/99 $ 4.00 $0.88

3/31/00 $10.00 $4.00
6/30/00 $ 9.25 $4.75
9/30/00 $ 5.50 $3.50
12/31/00 $ 4.75 $2.62

3/31/01 $6.06 $1.72
6/30/01 $3.00 $0.75

Holders of Common Stock are entitled to receive such dividends as may be
declared by the Board of Directors out of funds legally available therefor and,
in the event of liquidation, to share pro rata in any distribution of L.A.M.'s
assets after payment of liabilities. The Board of Directors is not obligated to
declare a dividend. L.A.M. has not paid any dividends and L.A.M. does not have
any current plans to pay any dividends.

Management's discussion and Analysis
OR plan of operationS

The following sets forth certain financial data with respect to L.A.M. and
is qualified in its entirety by reference to the more detailed financial
statements and notes included elsewhere in this prospectus.

Summary Financial Data

All of L.A.M.'s products are in the development stage. As a result, L.A.M.
has not generated any revenues from the sale of its products. Revenues since its
inception represent payments received from Ixora. See "Business" for further
information concerning L.A.M.'s agreement with Ixora.

Results of Operations:
Year Ended Six Months Ended
December 31, 2000 June 30, 2001

Revenue $ -- $300,000
Operating Expenses (4,805,269) (2,903,892)
Interest Income 28,261 21,464
------------ -----------
Net Loss $(4,777,008) $(2,582,428)
============ ============

Balance Sheet Data:
December 31, 2000 June 30, 2001

Six months ended June 30, 2001

Licensing revenue

During the six months ended June 30, 2001, licensing revenue of $300,000 was
received from Ixora Biomedical Company Inc. under the terms of their license
agreement in respect of L.A.M.'s sexual dysfunction products.

Research and Development Expenses

Research and development expenses increased during the six months ended June 30,
2001 as compared with the six months ended June 30, 2000 due to a higher level
of clinical studies activity during the first quarter of the current year
compared with the same quarter in the previous year.

General and Administrative Expenses

General and administrative expenses increased for the six months ended June 30,
2001 as compared with the six months ended June 30, 2000 primarily as a result
of costs incurred in connection with obtaining the equity line of credit,
commissions on the sale of convertible notes and additional investor relations
costs.

The primary components of general and administrative expenses for the six months
ended June 30, 2001 and 2000 were as follows:

2001 2000
---- ----

Officer's salary $ 57,112 $ 60,000
Employee salaries and benefits 90,917 86,612
Less: Salaries classified as
Research & Development (36,000) (36,000)
Investor Relations 223,842 69,734
Commissions paid on sales of
Convertible Notes 60,854 74,600
Financial Banking and Consulting 184,333 24,500
Filing and Registration Fees 23,009 ---

Legal and Auditing 105,084 58,346
Other Supplies and Expenses 100,479 69,753
------------- ------
Total $ 809,630 $ 407,545
============ =========

Conversion Premium

During the six months ended June 30, 2000 a conversion premium of $275,000
relating to the sale of convertible notes was charged to expense. The conversion
premium represents the difference between the fair value of L.A.M.'s common
stock and the conversion price of the convertible notes sold during the period.
The conversion premium did not require the use of cash.

Year Ended December 31, 2000

During the year ended December 31, 2000 research and development expenses
increased due to the start of clinical trials in Toronto, Canada as well as
deferred compensation paid to L.A.M.'s president. The clinical trials pertain to
L.A.M.'s arthritic pain drug.

General and administrative costs increased during the year as the result
of sales commissions paid in connection with the sale of L.A.M.'s convertible
notes, additional administrative personnel and increased legal expenses.

The primary components of general and administrative expenses for the year
ended December 31, 2000 were as follows:

Officer's salary $ 120,000
Employee salaries and benefits 277,108
Less: Salaries classified as Research
& Development (256,173)
Investor Relations 231,239
Stock Options and Awards 447,640
Commissions paid on sales of Convertible Notes 381,300
Financial Consulting 238,894
Legal and Auditing 174,168
Other Supplies and Expenses 160,018
----------
Total $ 1,774,194
===========

The expense of $447,640 associated with the grant of options to
consultants and employees and the issuance of common stock for services did not
require the use of cash.

Interest expense increased due to the sale of convertible notes between
September 1999 and November 2000.

During the year ended December 31, 2000 a conversion premium of $2,395,093
relating to the sale of convertible notes was charged to expense. The conversion
premium represents the difference between the fair value of L.A.M.'s common
stock and the conversion price of the convertible notes sold during the year.
The conversion premium did not require the use of cash.

Year Ended December 31, 1999

Higher contracted research costs incurred in conducting clinical trials
resulted in the increase in research and development expenses during 1998.
Research and development expenses tend to fluctuate from period to period
depending on the status of the Company's research projects and the timing of
clinical trials.

The increase in general and administrative expenses during 1999 was
attributable to the Company's efforts in raising capital, restructuring its
business activities, and registering the Company's common stock under the
Securities Exchange Act of 1934.

The primary components of general and administrative expenses for the year
ended December 31, 1999 were:

1999

Officer's salary $120,000
Employee salaries and benefits 81,830
Less: Salaries classified as Research &
Development (135,494)
Investor Relations 91,941
Stock Options and Awards 526,316
Commissions paid on sales of Convertible Notes 27,471
Financial Consulting 42,876
Legal and Auditing 92,802
Other Supplies and Expenses 58,315
----------

Total $906,057
========

The expense of $526,316 associated with the grant of options to
consultants and employees and the issuance of common stock for services did not
require the use of cash.

The increase in interest expense represents interest accrued for the year
on the convertible notes that were sold during the year ended December 31, 1999.
The Company did not sell any convertible notes in 1998.

During the year ended December 31, 1999, a conversion premium of
$1,252,000 relating to the sale of convertible notes was charged to expense. The
conversion premium represents the difference between the fair value of LA.M.'s
common stock and the conversion price of the convertible notes sold during the
year. L.A.M. did not sell any convertible notes during the year ended December
31, 1998. The conversion premium did not require the use of cash.

Plan of Operations

During the twelve months ending December 31, 2001 L.A.M. will continue:

o to seek and develop strategic relationships with companies interested in
using L.A.M.'s technology in conjunction with existing and future OTC
drugs and cosmetic products

o its program to commercialize its wound healing technology, including:
- completing negotiations for first manufacture;
- seeking distribution channels;
- seeking licensees and other strategic partners

o the development of its motion sickness patch systems

o supporting the next phase of Ixora's program to commercialize L.A.M.'s
sexual dysfunction products

o testing L.A.M.'s skin care products with a view to licensing the IPM
technology to third parties for use in products which will be classified
as cosmetics or OTC drugs.

During this twelve-month period L.A.M. anticipates hiring up to four additional
employees (or full time equivalents).

Liquidity and Sources of Capital

L.A.M's primary source of liquidity as of June 30, 2001 was cash and cash
equivalent investments of $928,000. Working capital, exclusive of convertible
debentures expected to be converted, decreased from $1,775,000 as of December
31, 2000 to $1,498,000 as of June 30, 2001.

L.A.M.'s operations used $432,000 in cash during the six months ended June 30,
2001. During this period L.A.M. also spent $85,000 for property and equipment
purchases, $8,700 on patent and trademark applications, and $60,000 to repay
convertible note holders. $1,075,000 was advanced to the Company's president
during the period for purchase of shares of common stock in an effort to
stabilize L.A.M.'s stock price in the face of extensive short selling. During
the period $90,000 of these advances were repaid.

During the twelve months ending December 31, 2001, L.A.M. expects that it will
spend between $250,000 and $300,000 on research, development, and clinical
studies relating to L.A.M.'s IPM Matrix technology. As of June 30, 2001 L.A.M.
had working capital of $1,498,000 (exclusive of convertible notes expected to be
converted to equity). L.A.M. plans to use its existing financial resources as
well as the proceeds from the sale of its common stock under the equity line of
credit agreement with Hockbury Limited to fund its capital requirements during
this period. It should be noted that substantial funds may be needed for more
extensive research and clinical studies before L.A.M. will be able to sell any
of its products on a commercial basis.

Other than funding its research and development activities and operating losses,
L.A.M. does not have any material capital commitments.

Due to the lack of any significant revenues, L.A.M. has relied upon proceeds
realized from the public and private sale of its common stock and convertible
debentures to meet its funding requirements. Funds raised by L.A.M. have been
expended primarily in connection with research, development, clinical studies
and administrative costs. L.A.M. does not anticipate realizing revenues until
such time as it begins the commercial sale of its products or enters into
licensing arrangements regarding these products, and in the interim it will be
required to fund its operations through the sale of securities, debt financing
or other arrangements. However, there can be no assurance that such financing
will be available or be available on favorable terms.

BUSINESS

The IPM technology is not a drug in and of itself, but rather a new system
for carrying, delivering and releasing drugs in a manner that can extend and/or
improve their efficacy and safety.

In order to fully understand and appreciate the significance and
effectiveness of L.A.M.'s drug delivery technology it is important to understand
how various drug-based formulations are applied to the skin and the ways that
substances applied to the skin are absorbed by the skin and other structures of
the body.

For many years lotions, creams, suspensions and solutions of various
natural (herbal) and therapeutic (drug) substances have been applied to the
skin. When it comes to treating pain, sexual dysfunction and other disease

states which emanate from structures of the body below the skin, topical therapy
is not effective unless the therapeutic agent can penetrate the outer layer of
the skin (stratum corneum) which acts as a protective barrier. This layer
consists of numerous dead cells and cells in transition, which collectively form
an effective barrier to penetration of substances, such as bacteria, in the air
or in water. Thus the stratum corneum plays an important role in protecting the
body from invasion by harmful substances.

It is this same protective role which has posed a major challenge over the
years regarding devising a mechanism that can effectively penetrate the stratum
corneum for the purpose of delivering therapeutic substances to structures deep
within the body.

In 1994 L.A.M.'s scientists discovered that certain molecules called
polymers possessed strong electrical charges which, when combined with other
polymers of a specific electrical charge, are able to effectively penetrate the
outer layers of the skin. In addition, these molecules are able to attach or
surround other molecules such as therapeutic drug molecules and carry them
within a matrix through the outer layers of the skin into the deeper structures
below. L.A.M.'s scientists recognized that these discoveries would be of great
significance in regard to the delivery of therapeutic agents. This phenomenon,
the ionic polymer matrix (IPM) delivery system, is covered by eight U.S. patents
which are owned by L.A.M.

IPM technology combines in a matrix, in a novel manner, those drugs which
are well-established and generally regarded by the public, the regulatory
authorities and the pharmaceutical industry as safe. Based on preliminary
studies conducted to date, L.A.M. believes that its IPM technology, when
combined with an active drug ingredient, will facilitate the delivery of greater
amounts of drug to structures within the body than is otherwise possible. IPM
therefore offers potential benefits by providing faster and more prolonged
therapeutic activity, less intrusive and less painful methods of delivery and
faster onset of therapeutic process.

L.A.M.'s products are regulated in the United States by the FDA. L.A.M. is of
the opinion that the products which it is developing will be classified as
cosmetics, OTC drugs, or new drugs. Products classified as cosmetics or OTC
drugs may be marketed without FDA approval. New drugs that are not cosmetics and
that are considered an OTC drug must be approved by the FDA prior to marketing
in the United States. Before human testing can begin with respect to a new drug
in the United States preclinical studies are conducted in laboratory animals to
evaluate the potential efficacy and the safety of a product. Human clinical
studies generally involve a three-phase process. The initial clinical
evaluation, Phase I, consists of administering the product and testing for safe
and tolerable dosage levels. Phase II trials continue the evaluation of safety
and determine the appropriate dosage for the product, identify possible side
effects and risks in a larger group of subjects, and provide preliminary
indications of efficacy. Phase III trials consist of testing for actual clinical
efficacy within an expanded group of patients at geographically dispersed test
sites.

L.A.M. believes that its IPM technology, when used with prescription
drugs, will be regulated as an unapproved new drug and will require approval by

the FDA. Conversely, L.A.M.'s IPM technology, when used with a cosmetic or an
OTC drug, could be marketed without FDA approval.

L.A.M.'s initial approach has been and continues to be to research and
develop applications of the IPM technology using well known and FDA approved or
licensed drugs the patents for which have expired or which are not otherwise
proprietary. This approach has a number of benefits:

o The properties, safety and efficacy of the drug that is to be delivered
are well established and regulatory approvals or licenses for them have
been granted in most or all important markets.
o The matrix materials used with the IPM technology are considered by the
FDA to be safe for use in humans.
o The regulatory process required to gain approval or licenses for the
drug-IPM delivery matrix should be substantially shorter than for a
drug-IPM matrix where the drug is not approved or licensed.

L.A.M. plans to evaluate a limited number of IPM/drug formulations that
have shown promise during preliminary clinical investigation. L.A.M.'s preferred
course is to negotiate licensing agreements and/or joint ventures with larger
pharmaceutical companies which have the financial resources to fund the research
and/or clinical trials necessary to complete the development of L.A.M. products.

If the results of the clinical trials are promising, L.A.M. may then be in
a position to negotiate licenses which would generate sufficient revenue so as
to allow L.A.M. to exploit the IPM technology using a variety of other drugs. It
should be emphasized that a number of risks may be associated with this
approach. While preliminary results have been promising, there is no certainty
that the efficacy of the IPM/drug formulations currently being tested will be
borne out in subsequent clinical trials. In addition, more clinical studies may
be requested by a potential licensee before it is willing to enter into an
agreement.

L.A.M.'s objective is to raise sufficient capital to enable it to sustain
ongoing research and administrative overhead as well as to enable it to
undertake the work necessary to obtain FDA approval for its products, if
required, and to license the products to third parties.

The longer L.A.M. is able to fund development and the clinical trials for
its products and thereby establish their efficacy, the greater their value will
be to a potential licensee given the reduced risk of failure. Consequently, the
longer L.A.M. retains sole ownership of the products the greater will be its
bargaining position with prospective licensees and strategic alliance partners.
Indeed, the industry places incrementally larger different values on drugs as
they progress through the clinical trials required by the FDA.

L.A.M. plans to market its products in any country where a suitable market
exists and which has approved L.A.M.'s products for sale.

In July 1996, L.A.M. entered into a joint venture agreement with South
Florida Bio-availability Clinic ("SFBC"). SFBC is a contract research firm in
Miami, Florida which has conducted over 300 Phase I, Phase II and Phase III
clinical studies for major pharmaceutical corporations. Under the terms of the
agreement, SFBC has conducted a number of studies in human patients for the
purpose of L.A.M.'s FDA drug approval submissions.

The agreement between L.A.M. and SFBC provides that SFBC will provide
office and laboratory space to L.A.M. in it's Miami facilities. As part of this
agreement, L.A.M. has transferred certain equipment and research activities from
Toronto to Miami. SFBC also agreed to provide certain support staff and office
infrastructure to L.A.M.

This arrangement benefits L.A.M. because it allows its researchers the
ability to work in close proximity to SFBC staff. In addition, by obtaining
studies at cost, L.A.M. is able to move its research along at a faster pace than
would have otherwise been possible.

At the present time L.A.M. is focusing its efforts on the following
projects:

WOUND HEALING

L.A.M. has developed an ulcer healing matrix for the treatment of
refractory (hard to heal) topical ulcers. Refractory topical ulcers are a major
problem for diabetics and others. Non-healing foot ulcers are a leading cause of
complications in patients with diabetes such as infection, immobility and lower
extremity amputation.

L.A.M. believes its ulcer healing matrix will also be effective in the
treatment of bedsores and other pressure sores. After the open sores are
cleaned, the matrix is applied to the affected skin, usually once a day, and
covered with a suitable dressing. The healing of bedsores treated with L.A.M.'s
matrix is relatively rapid and the treatment does not preclude the concomitant
use of other therapeutic agents including antibiotics and steroids.

L.A.M.'s ulcer matrix has produced excellent healing results in 8 out of 9
ulcers in a pilot study. These ulcers had not responded to previous treatment
using conventional methods. L.A.M.'s ulcer healing matrix has received approval
from the Institutional Review Board at Redding, California to conduct a
27-patient/50-wound trial to further substantiate the pilot study results.

L.A.M. is also developing a wound healing matrix designated to be used on
incisions following surgical procedures. L.A.M. believes its wound healing
matrix has potential as an effective post-operative treatment for the prevention
of adhesions and scar tissue following surgery. In addition, the L.A.M. wound
healing matrix offers potential for the reduction of post-operative
complications surrounding the site of incisions such as swelling and
inflammation.

SEXUAL DYSFUNCTION DRUG

L.A.M. technology has been successfully used to develop a topical gel
which, when applied to the genitals, provides a safe and effective treatment for
male impotency, a problem affecting 140 million men worldwide. The gel is
applied easily and without discomfort to the outside skin of the male genitals a
few minutes before sexual intercourse. The side-effects experienced with tablets
or intra-urethral treatments are minimized and are of a minor and infrequent
nature. L.A.M.'s IPM matrix utilizes an established agent which has been
approved for over 15 years. Pilot clinical trials conducted under the
compassionate provisions of the Canada Health Act are currently being conducted
in Toronto Canada.

L.A.M.'s gel offers several major advantages over current treatments
(Viagra, Muse, etc.). Firstly, the gel is applied directly to the outside skin
of the male genitals. Thus pain associated with invasive therapy is eliminated.
Furthermore, side-effects associated with tablets (drug interactions) are
reduced to a very low incidence and are very mild when they infrequently occur.
Sexual activity can commence almost immediately after application of the gel
(within 2 to 3 minutes).

In December 1997, L.A.M. granted an exclusive worldwide license to Ixora
Bio-Medical Co. ("Ixora") for the marketing, sale and distribution of certain of
its transdermal drugs for the treatment of male and female sexual dysfunction.
L.A.M. has received licensing payments of $500,000 from Ixora. Ixora is required
to reimburse L.A.M. for all costs of clinical studies and related research
required by the FDA or other government agencies as well as patent procurement
and maintenance costs, provided however that after January 1, 2000 Ixora is not,
without its consent, obligated to reimburse L.A.M. for costs in excess of
$10,000 per quarter. L.A.M. will receive the following royalties on sales by
Ixora:

o 9% of all Net Sales of licensed products approved by the FDA and for
which the patent rights have not expired.

o 6.5% of all Net Sales of all licensed products which did not require
FDA approval and for which the patent rights have not expired.

o 4.5% of all Net Sales of all licensed products for which the patent
rights have expired or have been held to be invalid.

For purposes of the license agreement the term "Net Sales" means gross
sales less advertising/promotion expenses not exceeding 8% of gross sales and
sales taxes.

In January 1998 L.A.M. acquired a 45% interest in Ixora for $207,360. As a
result of subsequent sales by Ixora of its common stock to other persons,
L.A.M., as of June 30, 2001, owned 18% of Ixora's common stock.

SKIN CARE

L.A.M.'s IPM matrix spreads easily over large areas of skin, making it
ideal for use as a cosmetic in various applications to the skin. Cosmetics are a
multi-billion dollar a year industry that do not require approval before
marketing, although cosmetics must be safe, contain appropriate cosmetic
ingredients and be labeled properly. Various uses for L.A.M.'s product include
controlling body odors, relief of dryness, and for moisturization. For example,
the IPM matrix could be used as a lubricant, to replenish moisture and general
skin conditioning, particularly because it is non-staining and non-irritating.
When used with a fragrance, it could control odor. When combined with certain
over-the-counter (OTC) drugs, L.A.M.'s IPM-drug matrix could be marketed as a
cosmetic.

Certain products marketed in the United States are considered cosmetics
and OTC drugs because they make cosmetic claims as well as therapeutic claims
and are intended to treat or prevent disease. Examples of such products include,
but are not limited to, anti-dandruff shampoos; sunscreens; make-ups,
moisturizers and skin care products that bear sunscreen, skin protectant or acne
claims; products that make breath-freshening or whitening claims;
antiperspirants that bear deodorant claims; and anti-microbial soaps. These
products must comply with the FDA requirements for both cosmetics and OTC drugs.

As a cosmeceutical, a combination of an OTC drug and a cosmetic product,
the IPM matrix can be used for a variety of topical and other uses. These
include use with certain antibiotic first aid products, antifungal drugs,
dandruff, dermatitis and psoriasis control products, external analgesics, skin
protectant-type products, such as for poison ivy and fever blisters and cold
sores, first aid antiseptics, and anorectal products. Preliminary skin care
trials have been successfully completed on approximately twenty patients in the
Redding, California area by a cutaneous surgeon and dermatologist. Since L.A.M.
is of the opinion that its skin care products will be classified as a cosmetic
or an OTC drug, these skin care trials are being conducted without FDA approval.

GOVERNMENT REGULATION

L.A.M.'s drug and cosmetic products are regulated in the United States
under the Federal Food, Drug and Cosmetic Act (FD&C Act), the Public Health
Service Act, and the laws of certain states. The FDA exercises significant
regulatory control over drugs manufactured and/or sold in the United States,
including those that are unapproved.

Federal laws such as the FD&C Act cover the testing, manufacture,
distribution, marketing, labeling, advertising (for prescription drugs), of all
new drugs. Drug registration and listing requirements also exist.

L.A.M. is of the opinion that the products being developed by L.A.M. will
be subject to one or more of the following FDA classifications:

Cosmetics

Cosmetics are generally the least regulated by the FDA compared to other
products subject to the FD&C Act. The legal distinction between cosmetics and
drugs is typically based on the intended use of the product, which is normally
discerned from its label or labeling. Cosmetic products are those intended for
"cleansing, beautifying, promoting attractiveness, or altering appearance"
whereas drugs are those intended for "diagnosis, cure, mitigation, treatment, or
prevention of disease", or that "affect the structure or any function of the
body".

A claim suggesting that a product affects the body in some "physiological"
way usually renders the product a drug - even if the effect is temporary. A
claim that the product penetrates and affects layers beneath the skin's surface
most likely would be viewed by the FDA as a drug claim. However, claims that a
product affects appearance through a "physical" effect are generally considered
cosmetic claims. The FDA's rationale for this distinction is that a claim of a
physiological effect is a claim that the product "affects" the structure or
function of the body, which is one element of the statutory definition of a
drug. A claim indicating that a product's effects are on the surface of the skin
can be a cosmetic claim.

Although cosmetics may be marketed without FDA approval, in order to be
marketed lawfully as a cosmetic, the product must be properly labeled and each
ingredient and each finished cosmetic product must be adequately substantiated
for safety prior to marketing.

Products which are not cosmetics, and which are marketed in the United
States, must either comply with specified OTC drug regulations (monographs) or
be specifically approved through the New Drug Application (NDA) or biologic
licensure process.

OTC Drugs

OTC drugs generally are defined as those drug products that can be used
safely and effectively by the general public without seeking treatment by a
physician or other health care professional. Thus, they do not require a
prescription by a health care professional and are available at retail
establishments. An OTC drug may be marketed without FDA approval if it conforms
to a particular product monograph as described below and otherwise meets the
requirements of the FD&C Act.

OTC monographs lists active ingredients, their dosage levels, and uses
(claims) for which OTC drug products are considered generally recognized as safe
and effective for specific use and are not misbranded. If a particular level of
an active ingredient and claim are allowed by a monograph, then a manufacturer
may market a product containing that ingredient and bearing that claim without
specific FDA approval - subject to compliance with other requirements of the
monographs and FD&C Act, including drug registration and listing obligations.
Aspirin is a common drug allowed by a monograph.

If a drug product does not conform to a particular OTC monograph, then
typically a New Drug Application must be reviewed and approved by the FDA prior

to marketing. Unlike prescription drugs, OTC drugs must bear adequate directions
for safe and effective use and warnings against misuse.

New Drug Applications and Biologic License Applications

New drugs and products that are not cosmetics or devices and that are not
covered by an OTC monograph must be approved by the FDA prior to marketing in
the United States. Pre-clinical testing programs on animals, followed by three
phases of clinical testing on humans, are typically required by the FDA in order
to establish product safety and efficacy. L.A.M. believes that its IPM
technology, when used with approved or unapproved prescription drugs or
biologics, will be regulated as an unapproved new drug or unapproved biologic
and will require approval by the FDA.

It is also possible that the IPM technology may be regulated as a
combination drug and medical device, in which case it would be subject both to
medical device and drug regulation.

Medical device regulation is based on classification of the device into
three classes, I, II, or III. Class III medical devices are regulated much like
drugs, whereas Class I and II devices are subject to abbreviated clearance
procedures. It is also possible that the use of the IPM technology with a
monographed OTC drug could render the product an unapproved new drug, which
would mean that the product is subject to new drug application approval
requirements before marketing.

The FDA may choose to regulate certain uses of the IPM technology as a
medical device if it determines that the mechanism by which the IPM technology
exerts its effects meets the definitional requirements of a medical device. A
medical device is a product that, among other requirements, does not achieve its
primary intended purposes through chemical action within or on the human body
and is not dependent upon being metabolized for the achievement of its primary
intended purposes. Although L.A.M. expects that most uses of the IPM technology
will be regulated as a drug, which is in essence a product that usually achieves
its effects by chemical action or physiological action in or on the body, to the
extent that the IPM technology is used to deliver pharmaceutically active
ingredients, it can be subject to both medical device and drug regulation.

The first stage of evaluation, pre-clinical testing, must be conducted in
animals. After safety has been demonstrated, the test results are submitted to
the FDA (or a state regulatory agency) along with a request for authorization to
conduct clinical testing, which includes the protocol that will be followed in
the initial human clinical evaluation. If the applicable regulatory authority
does not object to the proposed study, the investigator can proceed with Phase I
trials. Phase I trials consist of pharmacological studies on a relatively few
number of human subjects under rigidly controlled conditions in order to
establish lack of toxicity and a safe dosage range.

After Phase I testing is completed, one or more Phase II trials are
conducted in a limited number of patients to continue to test the product's
safety and also its efficacy, i.e. its ability to treat or prevent a specific
disease. If the results appear to warrant further studies, the data are
submitted to the applicable regulatory authority along with the protocol for a
Phase III trial. Phase III trials consist of extensive studies in large

populations designed to assess the safety of the product and the most desirable
dosage in the treatment or prevention of a specific disease. The results of the
clinical trials for a new drug are submitted to the FDA as part of a New Drug
Application ("NDA").

Biological drugs, such as vaccines, are subject to Biologics License
Applications (BLAs), not NDAs as are other drugs. They must be safe, pure and
potent. Generic competition does not exist for biologics, as it does for other
drugs. Biological drugs are generally subject to the same testing,
manufacturing, distribution, marketing, labeling, advertising and other
requirements for other drugs.

To the extent all or a portion of the manufacturing process for a product
is handled by an entity other than L.A.M., the manufacturing entity is subject
to inspections by the FDA and by other Federal, state and local agencies and
must comply with FDA Good Manufacturing Practices ("GMP") requirements. In
complying with GMP regulations, manufacturers must continue to expend time,
money and effort in the area of production, quality control and quality
assurance to ensure full compliance.

L.A.M. plans to undertake extensive and costly clinical testing to assess
the safety and efficacy of its potential drug delivery systems. Failure to
comply with FDA regulations applicable to such testing can result in delay,
suspension or cancellation of testing, and refusal by the FDA to accept the
results of the testing. In addition, the FDA may suspend clinical studies at any
time if it concludes that the subjects or patients participating in trials are
being exposed to unacceptable health risks. Further there can be no assurance
that human clinical testing will show any of L.A.M.'s drug delivery systems to
be safe and effective or that data derived from any testing will be suitable for
submission to the FDA.

The process required by European regulatory authorities before L.A.M.'s
systems can be marketed in Western Europe are similar to those in the United
States. First, appropriate pre-clinical laboratory and animal tests must be
done, followed by submission of a clinical trial exemption or similar
documentation before human clinical studies can be initiated. Upon completion of
adequate and well controlled clinical studies in humans that establish that the
drug is safe and efficacious, regulatory approval of a Market Authorization
Application must be obtained from the relevant regulatory authorities. As with
the FDA review process, there are numerous risks associated with the Market
Authorization Application review. Additional data may be requested by the
regulatory agency reviewing the Market Authorization Application to demonstrate
the contribution of a product component to the clinical safety and efficacy of a
product, or to confirm the comparable performance of materials produced by a
changed manufacturing process or at a changed manufacturing site.

The process of biologic and new drug development and regulatory approval
or licensure requires substantial resources and many years. There can be no
assurance that regulatory approval will ever be obtained for products developed
by L.A.M. Authorization for testing, approval for marketing of drugs, including
biologics, by regulatory authorities of most foreign countries must also be
obtained prior to initiation of clinical studies and marketing in those

countries. The approval process varies from country to country and the time
period required in each foreign country to obtain approval may be longer or
shorter than that required for regulatory approval in the United States.

There are no assurances that clinical trials conducted in foreign
countries will be accepted by the FDA for approval in the United States. Product
approval or licensure in a foreign country does not mean that the product will
be approved or licensed by the FDA and there are no assurances that L.A.M. will
receive any approval or license by the FDA or any other governmental entity for
the marketing of a drug product. Likewise product approval by the FDA does not
mean that the product will be approved or licensed by any foreign country.

Product Status

All of L.A.M.'s products are in various stages of development and testing
and the commercial sale of any of these products may not occur until June 2002
at the earliest. As a result, L.A.M. expects to incur additional losses for the
foreseeable future. L.A.M.'s estimates of the costs associated with future
research and clinical studies may be substantially lower than the actual costs
of these activities. If L.A.M.'s cost estimates are incorrect, L.A.M. will need
additional funding for its research efforts. There can be no assurance that
L.A.M.'s products will prove to have any therapeutic or other value.

The following is a summary of the status of the products which are being
developed by L.A.M.:

Projected Cost Projected Date
Anticipated FDA Needed to Complete of Completion
Product Name Classification Studies/Trials of Studies/Trials
- ------------ --------------- ------------------ -----------------

Wound Healing Cosmetic/OTC Drug $1,000,000(1) December 2001
Female Sexual
Dysfunction Cosmetic/OTC Drug $1,500,000 June 2002 (2)
Skin Care Cosmetic/OTC Drug $1,500,000 (3)

(1) Projected costs associated with the wound healing product include costs for
scaling up production.
(2) L.A.M. has licensed this product to Ixora Bio-Medical Co. Pursuant to the
terms of the Licensing Agreement Ixora is responsible for all the costs
required to obtain regulatory approval of this product. See "Business" for
additional information concerning L.A.M.'s agreement with Ixora.
(3) L.A.M. plans to fund the majority of these costs by licensing the rights to
these products to a joint venture partner. As of August 15, 2001 L.A.M. had
not entered into any agreements with any third party with respect to the
further development of these products.

Research and Development

As part of its ongoing research and development program L.A.M. intends to
develop and commercialize as many products based on its IPM technology as
possible. L.A.M. is in the early stages of developing formulations involving
morphine, and other compounds. L.A.M.'s long-range goal is to exploit other uses
of its matrix drug delivery system to improve the therapeutic effects of various
drugs.

During the years ended December 31, 1999 and 2000, L.A.M. spent $185,143
and $308,270 respectively on research and development. L.A.M.'s research and
development expenditures do not include research and development expenses
relating to L.A.M.'s Sexual Dysfunction Drug which were paid by Ixora Biomedical
Co.

Patents and Trademarks

As of August 15, 2001, L.A.M. owned nine U.S. patents, two U.S. patent
applications and twelve international patent applications designating over 100
foreign countries with claims relating to its sustained release delivery matrix
system, systems containing drug preparations, uses of the systems for various
treatment therapies and addiction therapeutic program.

L.A.M.'s patents will expire between 2015 and 2017.

Employees

As of August 15, 2001 L.A.M. had seven full time employee equivalents and
two part time employees.

offices and facilities

L.A.M.'s executive offices are located at 800 Sheppard Avenue West,
Commercial Unit 1, North York, Ontario, Canada. L.A.M. leases this space at a
rate of $1,200 per month pursuant to the lease which expires in 2003.

L.A.M. has a research facility at SFBC in Miami Florida. This facility is
registered and licensed by the State of Florida and is in compliance with the
FDA's Good Manufacturing Practices. The equipment in this facility includes:
three Cafano mixing systems, a 20 foot commercial depyrogenating oven,
sterilized fume hood autoclaves, and a Milipure sterile manufacturing water
system.

L.A.M. also has a 3,500 square foot facility in Lewiston, New York, which
is used primarily for the pilot production of its pharmaceutical products.
L.A.M. leases this space at a rate of $1,700 per month. The lease on this space
expires in 2003.

Management

The directors and executive officers of L.A.M. are as follows:

Name Age Position

Joseph T. Slechta 52 President, Chief Operating Officer and
Director
Alan Drizen 62 Chief Executive Officer and Director
Peter Rothbart, M.D. 62 Treasurer and Director
Gary M. Nath 55 Secretary and Director

Joseph T. Slechta has been L.A.M.'s Chief Operating Officer since November
2000. Mr. Slechta was appointed a director and became L.A.M.'s President on May
11, 2001. Mr. Slechta was a consultant to L.A.M. between November 1998 and
November 2000. Mr. Slechta was Managing Director of SBI Strategic Business
International Inc. between 1994 and 2000 where he assisted corporate clients in
financing, reorganization, expansion and improving operations. From 1987 to
1992, Mr. Slechta held executive management positions with three Canadian
corporations. His corporate assignments included the management and financing of
a high-technology company, the reorganization and sale of a helicopter company
and financial consulting services to a major Canadian life insurance company.
From 1979 to 1986 Mr. Slechta managed the treasury operations of Continental
Bank.

Alan Drizen has been President and a director of L.A.M. since its
inception. Prior to May 12, 2001 Mr. Drizen was L.A.M.'s President. On May 12,
2001 Mr. Drizen became L.A.M.'s Chief Executive Officer. Mr. Drizen has spent 30
years in senior positions including Chairman of the Board and a director of a
number of pharmaceutical companies. He was educated in England, the United
States and Canada and trained as a biochemist. Mr. Drizen has both technical and
managerial expertise in the development and commercialization of new drugs. In
the late 1980's, Mr. Drizen and his team of scientists characterized molecules
known as mucopolysaccharides which led to the founding of Hyal Pharmaceutical
Corporation, a public company listed on the Toronto Stock Exchange and NASDAQ.
The analytical standard, developed by his team, for one particular molecule,
sodium hyaluronate, now a component of many pharmaceutical preparations, is
still used by the Canada Health Protection Branch as the official standard for
this drug. Mr. Drizen's interest in polymer chemistry eventually led to his
collaboration with Dr. Peter Rothbart and to the discoveries on which L.A.M.'s
technologies are based.

Peter Rothbart, M.D., Medical Director, has been a director and Treasurer
of L.A.M. since its inception. He has been a consulting anesthetist for over 20
years and is a leading pain specialist and principal of the Rothbart Pain
Management Clinic in Toronto, Canada. Dr. Rothbart is currently President of the
North American Cervicogenic Headache Society, an association of specialists in
the treatment of cervicogenic headaches. He was also recently elected Chair of
the Chronic Pain Section of the Ontario Medical Association. In collaboration
with Alan Drizen, Dr. Rothbart discovered the IPM delivery system.

Gary M. Nath has been Secretary and a director of L.A.M. since its
inception. He has a BS degree in Biology and Chemistry, two years of
post-graduate work in Biochemistry and a law degree. Mr. Nath has worked in the
patent and trademark law departments of FMC Corporation, NL Industries, and
Warner Lambert Company in the capacities of patent attorney, group patent and
trademark counsel and general patent counsel, respectively. Mr. Nath is the
founding and managing partner of the intellectual property law firm Nath &
Associates located in Washington, DC. He counsels a wide range of domestic and
international clients across a broad range of technologies, including chemical,
pharmaceutical, biotechnical and mechanical fields. He has published extensively
and has spoken on intellectual property law procurement, enforcement and
transfer before numerous professional and lay groups in the United States and
Japan. He is a member of the American Bar Association, the New Jersey Bar
Association, the American Intellectual Property Law Association, the
International Patent Association, the Association of University Technology
Managers, and is admitted to practice before the U.S. Patent and Trademark
Office, Canadian Patent Office and numerous courts around the United States.

Executive Compensation.

The following table sets forth in summary form the compensation earned
or received by (i) the Chief Executive Officer of L.A.M. and (ii) by each other
executive officer of L.A.M. who earned or received in excess of $100,000 during
the fiscal years ended December 31, 1998, 1999 and 2000.

Annual Compensation Long Term Compensation
- -------------------------------------------------------------------------------
All
Re- Other
Other stric- Com-
Name and Compen- Stock Options pensa-
Principal Fiscal Salary Bonus sation Awards Granted tion
Position Year (1) (2) (3) (4) (5) (6)
- --------- ------ ------- ------- ------- ------ ------- -------

Alan Drizen, 2000 $120,000 -- -- -- -- --
President and 1999 $110,000 -- -- -- -- --
Chief Executive 1998 $120,000 -- -- -- -- --
Officer

(1) The dollar value of base salary (cash and non-cash) received or earned.
(2) The dollar value of bonus (cash and non-cash) received.
(3) Any other annual compensation not properly categorized as salary or bonus,
including perquisites and other personal benefits, securities or property.
(4) During the period covered by the foregoing table, the shares of restricted
stock issued as compensation for services. The table below shows the number
of shares of L.A.M.'s common stock owned by the officers listed above, and
the value of such shares as of December 31, 2000.

Name Shares Value

Alan Drizen 2,369,924 $7,583,700

(5) The shares of Common Stock to be received upon the exercise of all stock
options granted during the period covered by the table
(6) All other compensation received that L.A.M. could not properly report in
any other column of the table.

The following shows the amounts which L.A.M. expects to pay to its officers
during the twelve month period ending December 31, 2001, and the time which
L.A.M.'s executive officers plan to devote to L.A.M.'s business. L.A.M. does not
have employment agreements with any of its officers.

Proposed Time to be Devoted
Name Compensation To Company's Business

Joseph Slechta $150,000 100%
Alan Drizen $120,000 100%
Peter Rothbart -- 5%
Gary M. Nath -- 15%

(1) The compensation to be paid to these persons will depend upon funding
L.A.M. receives separate and apart from this offering.

Gary Nath provides legal services to L.A.M. See "Certain Relationships and
Transactions" below. During the year ending December 31, 2001 L.A.M. expects
that it will continue to use the services of Mr. Nath's law firm.

L.A.M.'s Board of Directors may increase the compensation paid to L.A.M.'s
officers depending upon the results of L.A.M.'s future operations.

L.A.M. does not have any employment agreements with any of its executive
officers.

Certain Relationships and Transactions.

In September 1998 L.A.M. sold shares of its common stock to the persons, in
the amounts, and for the consideration set forth below:

Number
Name of Shares Consideration

Alan Drizen 1,076,308 (1) $10,763
Peter Rothbart 1,076,308 (2) $10,763
Gary M. Nath 742,784 $7,423

In September 1998 L.A.M. issued 6,000,000 shares of its common stock in
consideration for all of issued and outstanding shares of LAM Pharmaceuticals
LLC, a Florida limited liability company. See "Business" for further information
concerning the acquisition of LAM Pharmaceuticals LLC. The following officers,
directors and other persons received shares of L.A.M.'s common stock in
connection with this transaction.

Name Shares Acquired

Alan Drizen 1,603,616 (1)
Peter Rothbart 1,603,616 (2)
Gary M. Nath 1,105,942
Lisa Krinsky 674,510 (3)
Arnold Hantman 376,019
All Other Sellers as a Group 636,297
----------
6,000,000

(1) Includes shares held by the Canyon Trust, a discretionary trust, of which
Mr. Drizen may be deemed the beneficial owner.
(2) Includes shares held by the Lexus Trust, of which Mr. Rothbart may be
deemed the beneficial owner.
(3) Includes shares held by the South Florida Bioavailability Clinic of which
Lisa Krinsky is the majority shareholder.

Subsequent to September 1998 Mr. Drizen, Mr. Rothbart and Mr. Nath sold a
portion of their shares in transactions which were exempt pursuant to Rule 144
of the Securities and Exchange Commission and gifted a portion of their shares
to relatives.

L.A.M. has received advances from Mr. Drizen ($525,000), Mr. Rothbart
($170,000) and Mr. Nath ($475,000) that were used to fund L.A.M.'s operations,
research and development and clinical trials. These advances will be repaid,
without interest, out of 25% of any net income generated by L.A.M. Net income
will be determined under generally accepted accounting principles and on a
quarterly, after tax basis.

During 1998, 1999 and 2000 L.A.M. paid Mr. Nath, an officer and director of
L.A.M., $10,721, $63,210, and $71,100 respectively for legal services provided
to L.A.M. As of December 31, 2000 L.A.M. owed Mr. Nath approximately $324,000
for legal services.

During the six months ended June 30, 2001 Mr. Drizen, an officer and
director of L.A.M., borrowed $1,075,000 from L.A.M. The amounts borrowed by Mr.
Drizen were used to purchase shares of L.A.M.'s common stock in an effort to
stabilize L.A.M.'s stock price in the face of extensive short selling.

See "Stock Option and Bonus Plans" below for information concerning stock
options and stock bonuses granted to L.A.M.'s officers and directors.

Long Term Incentive Plans - Awards in Last Fiscal Year

None.

Employee Pension, Profit Sharing or Other Retirement Plans

L.A.M. does not have a defined benefit, pension plan, profit sharing or
other retirement plan, although L.A.M. may adopt one or more of such plans in
the future.

Compensation of Directors

Standard Arrangements. At present L.A.M. does not pay its directors for
attending meetings of the Board of Directors, although L.A.M. may adopt a
director compensation policy in the future. L.A.M. has no standard arrangement
pursuant to which directors of L.A.M. are compensated for any services provided
as a director or for committee participation or special assignments.

Other Arrangements. During the year ended December 31, 2000, and except as
disclosed elsewhere in this registration statement, no director of L.A.M.
received any form of compensation from L.A.M.

See " Stock Option and Bonus Plans" below for information concerning
stock options and stock bonuses granted to L.A.M.'s officers and directors.

Stock Option and Bonus Plans

L.A.M. has an Incentive Stock Option Plan, a Non-Qualified Stock Option
Plan and a Stock Bonus Plan. A summary description of each Plan follows. In some
cases these three Plans are collectively referred to as the "Plans".

Incentive Stock Option Plan. The Incentive Stock Option Plan authorizes the
issuance of options to purchase up to 1,000,000 shares of L.A.M.'s Common Stock,
less the number of shares already optioned under both this Plan and the
Non-Qualified Stock Option Plan. The Incentive Stock Option Plan became
effective on March 15, 2000 and will remain in effect until March 15, 2010
unless terminated earlier by action of the Board. Only officers, directors and
key employees of L.A.M. may be granted options pursuant to the Incentive Stock
Option Plan.

In order to qualify for incentive stock option treatment under the
Internal Revenue Code, the following requirements must be complied with:

1. Options granted pursuant to the Plan must be exercised no later than:

(a) The expiration of thirty (30) days after the date on which an option
holder's employment by L.A.M. is terminated.

(b) The expiration of one year after the date on which an option holder's
employment by L.A.M. is terminated, if such termination is due to the
Employee's disability or death.

2. In the event of an option holder's death while in the employ of L.A.M.,
his legatees or distributees may exercise (prior to the option's expiration) the
option as to any of the shares not previously exercised.

3. The total fair market value of the shares of Common Stock (determined
at the time of the grant of the option) for which any employee may be granted
options which are first exercisable in any calendar year may not exceed
$100,000.

4. Options may not be exercised until one year following the date of grant.
Options granted to an employee then owning more than 10% of the Common Stock of
L.A.M. may not be exercisable by its terms after five years from the date of
grant.

5. The purchase price per share of Common Stock purchasable under an
option is determined by the Committee but cannot be less than the fair market
value of the Common Stock on the date of the grant of the option (or 110% of the
fair market value in the case of a person owning L.A.M.'s stock which represents
more than 10% of the total combined voting power of all classes of stock).

Non-Qualified Stock Option Plan. The Non-Qualified Stock Option Plan
authorizes the issuance of options to purchase up to 7,000,000 shares of
L.A.M.'s Common Stock less the number of shares already optioned under both this
Plan and the Incentive Stock Option Plan. The Non-Qualified Stock Option Plan
became effective on March 15, 2000 and will remain in effect until March 15,
2010 unless terminated earlier by the Board of Directors. L.A.M.'s employees,
directors, officers, consultants and advisors are eligible to be granted options
pursuant to the Plan, provided however that bona fide services must be rendered
by such consultants or advisors and such services must not be in connection with
the offer or sale of securities in a capital-raising transaction. The option
exercise price is determined by the Committee but cannot be less than the market
price of L.A.M.'s Common Stock on the date the option is granted.

Options granted pursuant to the Plan not previously exercised terminate
upon the date specified when the option was granted.

Stock Bonus Plan. Up to 500,000 shares of Common Stock may be granted
under the Stock Bonus Plan. Such shares may consist, in whole or in part, of
authorized but unissued shares, or treasury shares. Under the Stock Bonus Plan,
L.A.M.'s employees, directors, officers, consultants and advisors are eligible
to receive a grant of L.A.M.'s shares; provided, however, that bona fide
services must be rendered by consultants or advisors and such services must not
be in connection with the offer or sale of securities in a capital-raising
transaction.

Other Information Regarding the Plans. The Plans are administered by
L.A.M.'s Board of Directors. The Board of Directors has the authority to

interpret the provisions of the Plans and supervise the administration of the
Plans. In addition, the Board of Directors is empowered to select those persons
to whom shares or options are to be granted, to determine the number of shares
subject to each grant of a stock bonus or an option and to determine when, and
upon what conditions, shares or options granted under the Plans will vest or
otherwise be subject to forfeiture and cancellation.

In the discretion of the Board of Directors, any option granted pursuant
to the Plans may include installment exercise terms such that the option becomes
fully exercisable in a series of cumulating portions. The Board of Directors may
also accelerate the date upon which any option (or any part of any options) is
first exercisable. Any shares issued pursuant to the Stock Bonus Plan and any
options granted pursuant to the Incentive Stock Option Plan or the Non-Qualified
Stock Option Plan will be forfeited if the "vesting" schedule established by the
Board of Directors at the time of the grant is not met. For this purpose,
vesting means the period during which the employee must remain an employee of
L.A.M. or the period of time a non-employee must provide services to L.A.M. At
the time an employee ceases working for L.A.M. (or at the time a non-employee
ceases to perform services for L.A.M.), any shares or options not fully vested
will be forfeited and cancelled. In the discretion of the Board of Directors
payment for the shares of Common Stock underlying options may be paid through
the delivery of shares of L.A.M.'s Common Stock having an aggregate fair market
value equal to the option price, provided such shares have been owned by the
option holder for at least one year prior to such exercise. A combination of
cash and shares of Common Stock may also be permitted at the discretion of the
Board of Directors.

Options are generally non-transferable except upon death of the option
holder. Shares issued pursuant to the Stock Bonus Plan will generally not be
transferable until the person receiving the shares satisfies the vesting
requirements imposed by the Board of Directors when the shares were issued.

The Board of Directors of L.A.M. may at any time, and from time to time,
amend, terminate, or suspend one or more of the Plans in any manner it deems
appropriate, provided that such amendment, termination or suspension cannot
adversely affect rights or obligations with respect to shares or options
previously granted. The Board of Directors may not, without shareholder
approval: make any amendment which would materially modify the eligibility
requirements for the Plans; increase or decrease the total number of shares of
Common Stock which may be issued pursuant to the Plans except in the case of a
reclassification of L.A.M.'s capital stock or a consolidation or merger of
L.A.M.; reduce the minimum option price per share; extend the period for
granting options; or materially increase in any other way the benefits accruing
to employees who are eligible to participate in the Plans.

The Plans are not qualified under Section 401(a) of the Internal Revenue
Code, nor are they subject to any provisions of the Employee Retirement Income
Security Act of 1974.

Summary. The following sets forth certain information as of August 15,
2001 concerning the stock options and stock bonuses granted by L.A.M. Each
option represents the right to purchase one share of L.A.M.'s common stock.

Total Shares Remaining
Shares Reserved for Shares Options/
Reserved Outstanding Issued As Shares
Name of Plan Under Plan Options Stock Bonus Under Plan

Incentive Stock Option Plan 1,000,000 -- N/A 1,000,000
Non-Qualified Stock Option
Plan 7,000,000 4,500,000 N/A 2,500,000
Stock Bonus Plan 500,000 N/A 100,000 400,000

The following table summarizes the options and stock bonuses granted to the
Company's officers, directors, employees and consultants pursuant to the Plans:

Incentive Stock Options

None

Non-Qualified Stock Options

Shares Subject Exercise Date of Expiration
Option Holder To Option Price Grant Date of Option
- ------------- ------------ -------- -------- --------------

Joseph Slechta 300,000 $0.75 06/05/01 06/05/06
Joseph Slechta 300,000 $0.75 07/16/01 06/05/06
Joseph Slechta 3,000,000 $0.75 07/16/01 06/30/11 *
Alan Drizen 300,000 $0.75 07/16/0106/05/06
Peter Rothbart, M.D. 300,000 $0.75 07/16/0106/05/06
Gary M. Nath 300,000 $0.75 07/16/0106/05/06
Other employees of L.A.M.
and third parties 360,000 $0.65-3.50 11/05/00-11/30/00 To 04/01/04

The shares issuable upon the exercise of 4,500,000 of the options listed
above have been registered for public sale by means of a registration statement
on Form S-8 which has been filed with the Securities and Exchange Commission.

* The exercise of these options is subject to the following conditions:

(1) Options to purchase 750,000 shares will not be exercisable and will
expire on 12/31/01 unless between 6/30/01 and 1/01/02 L.A.M.:

A. receives a minimum of $500,000 in debt or equity financing; or
B. enters into a license, product development agreement or other agreement
which will provide revenues to L.A.M., it being understood that no minimum
revenues are required.

(2) Option to purchase 1,000,000 shares will not be exercisable and will
expire on 12/31/02 unless between 1/01/02 and 1/01/03 L.A.M.:

A. receives a minimum of $2,000,000 in debt or equity financing; or
B. enters into a license, product development agreement or other agreement
which will provide revenues to L.A.M. of at least $2,000,000 over the term
of the license or agreement; or
C. has gross revenues of $5,000,000.

(3) Options to purchase 1,250,000 shares will not be exercisable and will
expire on 12/31/03 unless between 1/01/03 and 1/01/04 L.A.M.:

In the event the performance criteria set forth in (1), (2), or (3) above
are not met, then options will be exercisable on a pro rata basis based upon the
performance achieved versus the performance criteria specified. A majority of
L.A.M.'s disinterested directors will determine the number of options which are
exercisable.

Notwithstanding the foregoing all options which have not yet expired will
be immediately exercisable and fully vested in the event Slechta is terminated
without cause or upon a Change in Control. A Change in Control will be deemed to
have occurred if:

(i) any "person" (as such term is defined in Sections 13(d)(3) and
14(d)(2) of the Securities Exchange Act), other than L.A.M., any
majority-owned subsidiary of the Company or any compensation plan of
L.A.M., becomes the "beneficial owner" (as such term is defined in
Rule 13d-3 of the Exchange Act), directly or indirectly, of
securities of L.A.M. (whether by merger, consolidation,
reorganization or otherwise) representing 40% or more of the
combined voting power of L.A.M.'s then outstanding securities;

(ii) prior to 01/04/04, the individuals who on the date of this
resolution constitute the Board of Directors of L.A.M. cease for any
reason to constitute at least a majority of such Board of Directors,
unless the election of each director who was not a director on the
date of this resolution has been approved in advance by directors
representing at least two-thirds of the directors then in office who
were also directors on the date of this resolution;

(iii)any "person" (as such term is defined in Sections 13(d)(3) and
14(d)(2) of the Exchange Act), other than L.A.M., any subsidiary of
L.A.M. or any compensation, retirement, pension or other employee
benefit plan or trust of L.A.M., becomes the "beneficial owner" (as

such term is defined in Rule 13d-3 promulgated under the Exchange
Act), directly or indirectly, of securities of any wholly-owned or
majority -owned subsidiary/subsidiaries of L.A.M. or any successor to
any wholly-owned or majority-owned subsidiary/subsidiaries of L.A.M.,
(whether by merger, consolidation, reorganization or otherwise)
representing a majority of the combined voting power of the then
outstanding securities of any wholly owned majority owned
subsidiary/subsidiaries of L.A.M., as the case may be;

(iv) L.A.M. merges or consolidates with or into another corporation or
other entity, or enters into a binding agreement to merge or
consolidate with or into another corporation or other entity, other
than a merger or consolidation which would result in the voting
securities of L.A.M. outstanding immediately prior thereto
continuing to represent (either by remaining outstanding or by being
converted into voting securities of the surviving corporation or
entity) not less than 60% of the combined voting power of the voting
securities of L.A.M. or such surviving corporation or entity
outstanding immediately after such merger or consolidation;

(v) L.A.M. shall sell, lease, exchange, transfer, convey or otherwise
dispose of all or substantially all of its assets, or enter into a
binding agreement for the sale, lease, exchange, transfer,
conveyance or other disposition of all or substantially all of its
assets, in one transaction or in a series of related transactions;

(vi) L.A.M. shall liquidate or dissolve, or any plan or proposal shall be
adopted for the liquidation or dissolution of L.A.M.

Notwithstanding the foregoing all options which are not yet exercisable
will immediately expire on the date (i) Slechta voluntarily terminates his
employment with L.A.M. or (ii) the date L.A.M. notifies Slechta that he has been
Terminated for Cause. Terminated for Cause means:

(i) The determination by a vote of a majority of the disinterested
members of the Board of Directors, which determination shall be
based upon competent medical evidence, that Slechta will be unable
to perform his duties as an officer of L.A.M. by reason of injury,
illness, or other physical or mental disability after absences for a
period or periods aggregating in excess of 45 working days in any
12-month period.

(ii) The determination by a majority of the disinterested members of the
Board of Directors that Slechta has been absent from his employment
for whatever cause, excluding allowable vacations or sickness and
disability, for a period of more than 60 working days in any
12-month period.

(iii) The vote of a majority of the disinterested members of the Board of
Directors determining that Slechta has become so intemperate in his
use of alcohol or drugs as seriously to interfere with the
performance of his duties as an officer of L.A.M.

(iv) A vote of a majority of the disinterested members of the Board of
Directors finding that (A) Slechta has violated any statute or
regulation, materially and adversely affecting L.A.M. reputation, or
earnings or welfare, (B) has been grossly negligent or engaged in
willful misconduct in the performance of his duties as an officer of
L.A.M., or (C) Slechta has refused to follow the proper directions
of the Board of Directors.

Any financing, license agreement, product development agreement or other
agreement referred to in (1), (2) or (3) above must be approved by L.A.M.'s
Board of Directors.

During October and November 2000, L.A.M. granted Mr. Slechta options to
purchase 225,000 shares of common stock at prices ranging between $3.50 to $4.00
per share. The options have since been cancelled by the mutual agreement of
L.A.M. and Mr. Slechta.

Stock Bonuses

The following officers of L.A.M. have received shares of the Company's
common stock as stock bonuses:

Name Shares
---- -------

Joseph Slechta 100,000

Other Options

See "Comparative Share Data" for information concerning other outstanding
options. Persons owning certain of these options which collectively allow for
the purchase of 1,731,000 shares of L.A.M.'s common stock are offering the
shares issuable upon the exercise of these options for public sale by means of
this prospectus. See "Selling Shareholders".

PRINCIPAL SHAREHOLDERS

The following table sets forth certain information as of August 15, 2001
concerning the common stock owned by each officer and director of L.A.M., and
each other person known to L.A.M. to be the beneficial owner of more than five
percent (5%) of L.A.M.'s common stock.

Amount and Nature of
Beneficial Ownership Percentage
Name Number of Shares (1) Ownership

Joseph T. Slechta 125,000 0.8%
800 Sheppard Avenue West,
Commercial Unit 1
Toronto, Ontario
Canada M3H 6B4

Alan Drizen 2,524,924 (2) 16.7%
800 Sheppard Avenue West,
Commercial Unit 1
Toronto, Ontario
Canada M3H 6B4

Peter Rothbart 2,679,924 (3) 17.7%
274 St. Clements Avenue.
Toronto, Ontario
Canada M4R 1H5

Gary M. Nath 1,848,226 12.2%
6106 Goldtree Way,
Bethesda, Maryland 20817

(All Officers and Directors as
a group, 4 persons) 7,178,074 47.4%

(1) Excludes shares issuable upon the exercises of options granted to the
following persons:

Shares Issuable
Upon Exercise Option Expiration
Name of Option Exercise Price Date of Option
---- --------------- -------------- --------------

Joseph T. Slechta 300,000 $0.75 06/05/06
Joseph T. Slechta 300,000 $0.75 06/05/06
Joseph T. Slechta 3,000,000 $0.75 06/30/11
Alan Drizen 300,000 $0.75 06/05/06
Peter Rothbart 300,000 $0.75 06/05/06
Gary M. Nath 300,000 $0.75 06/05/06

(2) Includes shares held by the Canyon Trust, a discretionary trust, of which
Mr. Drizen may be deemed the beneficial owner.

(3) Includes shares held by the Lexus Trust, of which Mr. Rothbart may be
deemed the beneficial owner.

SELLING SHAREHOLDERS

This prospectus relates the sale of shares of L.A.M.'s common stock by
certain owners of such shares. The shares were issued by L.A.M. in various
private offerings for cash, services rendered, and in settlement of amounts owed
by L.A.M. to various third parties.

The owners of the common stock to be sold by means of this prospectus are
referred to as the "selling shareholders".

L.A.M. will not receive any proceeds from the sale of the shares by the
selling shareholders. The selling shareholders may resell the shares they
acquire by means of this prospectus from time to time in the public market. The
costs of registering the shares offered by the selling shareholders are being
paid by L.A.M. The selling shareholders will pay all other costs of the sale of
the shares offered by them.

The following table identifies the selling shareholders and the shares which
are being offered for sale by the selling shareholders.

Shares
Issuable
Shares Upon the Shares to Be Share
Presently Exercise Sold in this Ownership
Name Owned of Options Offering After Offering

Antonio Care 35,000 100,000 100,000 35,000
Barry Kaplan Associates -- 300,000 300,000 --
Bob Gude -- 25,000 25,000 --
Burnham Securities -- 5,000 5,000 --
Marek Gawel -- 36,000 36,000 --
John Guerra 55,299 150,000 150,000 55,299
Julia Ross 5,000 20,000 20,000 5,000
Ken Skoretz -- 30,000 30,000 --
Michael Micallizzi -- 175,000 175,000 --
Peter Copetti 375,000 1,000,000 1,000,000 375,000
Ronald Reece 100,000 -- 100,000 --
1344393 Ontario, Inc. -- 500,000 500,000 --
3501931 Canada Inc. 100,000 200,000 200,000 100,000
AnnaMarie Muzzetti -- 25,000 25,000 --
Bess Lokach 5,000 10,000 10,000 5,000
Darryl Bonder -- 7,500 7,500 --
David Coates -- 50,000 50,000 --
David Hochman -- 10,000 10,000 --
Harley Waxer -- 50,000 50,000 --
Elizabeth Campbell -- 15,000 15,000 --
Ian and Marguerite Caunt 57,500 50,000 50,000 57,500

John and Mirella Zanella -- 15,000 15,000 --
John Verrell -- 50,000 50,000 --
Patrick Manuel -- 7,500 7,500 --
Peter Langenburg 200,000 50,000 50,000 200,000
Peter Vitelli -- 10,000 10,000 --
Pina Noce -- 35,000 35,000 --
Robert P. Grandy -- 25,000 25,000 --
Ron Makischuk -- 50,000 50,000 --
Russell Plawiuk -- 50,000 50,000 --
Tony Maiolino -- 10,000 10,000 --

Manner of Sale. The shares of common stock owned, or which may be
acquired, by the selling shareholders may be offered and sold by means of this
prospectus from time to time as market conditions permit in the over-the-counter
market, or otherwise, at prices and terms then prevailing or at prices related
to the then-current market price, or in negotiated transactions. These shares
may be sold by one or more of the following methods, without limitation:

o a block trade in which a broker or dealer so engaged will attempt to sell
the shares as agent but may position and resell a portion of the block as
principal to facilitate the transaction;
o purchases by a broker or dealer as principal and resale by such broker or
dealer for its account pursuant to this prospectus;
o ordinary brokerage transactions and transactions in which the broker
solicits purchasers; and
o face-to-face transactions between sellers and purchasers without a
broker/dealer.

In effecting sales, brokers or dealers engaged by the selling shareholders
may arrange for other brokers or dealers to participate. Brokers or dealers may
receive commissions or discounts from selling shareholders in amounts to be
negotiated.

The selling shareholders and any broker/dealers who act in connection with
the sale of the Shares hereunder may be deemed to be "underwriters" within the
meaning of ss.2(11) of the Securities Acts of 1933, and any commissions received
by them and profit on any resale of the Shares as principal might be deemed to
be underwriting discounts and commissions under the Securities Act. L.A.M. has
agreed to indemnify the selling shareholders and any securities broker/dealers
who may be deemed to be underwriters against certain liabilities, including
liabilities under the Securities Act as underwriters or otherwise.

L.A.M. has advised the selling shareholders that they and any securities
broker/dealers or others who may be deemed to be statutory underwriters will be
subject to the prospectus delivery requirements under the Securities Act of
1933. L.A.M. has also advised each Selling Shareholder that in the event of a
"distribution" of the shares owned by the Selling Shareholder, such Selling
Shareholder, any "affiliated purchasers", and any broker/dealer or other person
who participates in such distribution may be subject to Rule 102 under the
Securities Exchange Act of 1934 ("1934 Act") until their participation in that

distribution is completed. Rule 102 makes it unlawful for any person who is
participating in a distribution to bid for or purchase stock of the same class
as is the subject of the distribution. A "distribution" is defined in Rule 102
as an offering of securities "that is distinguished from ordinary trading
transactions by the magnitude of the offering and the presence of special
selling efforts and selling methods". L.A.M. has also advised the selling
shareholders that Rule 101 under the 1934 Act prohibits any "stabilizing bid" or
"stabilizing purchase" for the purpose of pegging, fixing or stabilizing the
price of the common stock in connection with this offering.

DESCRIPTION OF SECURITIES
Common Stock

L.A.M. is authorized to issue 50,000,000 shares of Common Stock (the "Common
Stock"). As of August 15, 2001 L.A.M. had 15,148,284 shares of Common Stock
issued and outstanding. Holders of Common Stock are each entitled to cast one
vote for each share held of record on all matters presented to shareholders.
Cumulative voting is not allowed; hence, the holders of a majority of the
outstanding Common Stock can elect all directors.

Holders of Common Stock are entitled to receive such dividends as may be
declared by the Board of Directors out of funds legally available therefore and,
in the event of liquidation, to share pro rata in any distribution of L.A.M.'s
assets after payment of liabilities. The Board of Directors is not obligated to
declare a dividend and it is not anticipated that dividends will be paid until
L.A.M. is in profit.

Holders of Common Stock do not have preemptive rights to subscribe to
additional shares if issued by L.A.M. There are no conversion, redemption,
sinking fund or similar provisions regarding the Common Stock.

Preferred Stock

L.A.M. is authorized to issue up to 5,000,000 shares of Preferred Stock.
L.A.M.'s Articles of Incorporation provide that the Board of Directors has the
authority to divide the Preferred Stock into series and, within the limitations
provided by Delaware statute, to fix by resolution the voting power,
designations, preferences, and relative participation, special rights, and the
qualifications, limitations or restrictions of the shares of any series so
established. As the Board of Directors has authority to establish the terms of,
and to issue, the Preferred Stock without shareholder approval, the Preferred
Stock could be issued to defend against any attempted takeover of L.A.M.

Transfer Agent

Corporate Stock Transfer, Inc.
3200 Cherry Creek Drive South, Suite 430
Denver CO, 80209
Telephone Number (303)-282-4800
Facsimile Number (303)-777-3094

LEGAL PROCEEDINGS

L.A.M. is not involved in any pending or threatened legal proceeding.

EXPERTS

The audited consolidated balance sheet of L.A.M. as of December 31, 1999
and 2000, and the related Statements of Operations, Changes in Deficiency in
Assets and of Cash Flows for the period from inception (February 1, 1994) to
December 31, 2000 and the two years ended December 31, 1999 and 2000, included
herein have been audited by Rotenberg & Company, LLP, independent public
accountants, as indicated in their report with respect thereto, and are included
herein in reliance upon the authority of said firm as experts in accounting and
auditing in giving said report.

With respect to the Independent Accountants' Reports on the unaudited
interim financial information of L.A.M. Pharmaceutical Corp. for the three
months ended March 31, 2001 and 2000 dated May 14, 2001, and for the six months
ended June 30, 2001 and 2000 dated August 9, 2001, which are incorporated herein
by reference, Rotenberg & Company, LLP have applied limited procedures in
accordance with professional standards for a review of such information.
However, as stated in their reports and incorporated by reference herein, they
did not audit and they did not express an opinion on that interim financial
information. Accordingly, the degree of reliance on their reports on such
information should be restricted in light of the limited nature of the review
procedures applied. Rotenberg & Company, LLP are not subject to the liability
provisions of Section 11 of the Securities Act of 1933 for their reports on the
unaudited interim financial information because those reports are not "reports"
on a "part" of the registration statement prepared or certified by an accountant
within the meaning of Sections 7 and 11 of the Act.

Effective November 8, 1999 L.A.M. retained Rotenberg & Company, LLP to act
as L.A.M.'s independent certified public accountants. In this regard Rotenberg &
Company replaced Ernst & Young, LLP ("Ernst & Young") which audited L.A.M.'s
financial statements for the fiscal year ended December 31, 1997. L.A.M.
replaced Ernst & Young since L.A.M.'s accounting functions were transferred from
Florida to Ontario, Canada. The report of Ernst & Young for this fiscal year did
not contain an adverse opinion, or disclaimer of opinion and was not qualified
or modified as to audit scope or accounting principles. However, the report of
Ernst & Young for this fiscal year was qualified with respect to uncertainty as
to L.A.M.'s ability to continue as a going concern. During L.A.M.'s two most
recent fiscal years and subsequent interim period ending November 8, 1999, there
were no disagreements with Ernst & Young on any matter of accounting principles
or practices, financial statement disclosure or auditing scope or procedures,
which disagreements, if not resolved to the satisfaction of Ernst & Young would
have caused it to make reference to such disagreements in its reports.

L.A.M. has authorized Ernst & Young to discuss any matter relating to
L.A.M. and its operations with Rotenberg & Company.

The change in L.A.M.'s auditors was recommended and approved by the board
of directors of L.A.M. L.A.M. does not have an audit committee.

During the two most recent fiscal years and subsequent interim period
ending November 8, 1999, L.A.M. did not consult with Rotenberg & Company
regarding the application of accounting principles to a specified transaction,
either completed or proposed, or the type of audit opinion that might be
rendered on L.A.M.'s financial statements, or any matter that was the subject of
a disagreement or a reportable event as defined in the regulations of the
Securities and Exchange Commission.

INDEMNIFICATION

L.A.M.'s Bylaws authorize indemnification of a director, officer, employee
or agent of L.A.M. against expenses incurred by him in connection with any
action, suit, or proceeding to which he is named a party by reason of his having
acted or served in such capacity, except for liabilities arising from his own
misconduct or negligence in performance of his duty. In addition, even a
director, officer, employee, or agent of L.A.M. who was found liable for
misconduct or negligence in the performance of his duty may obtain such
indemnification if, in view of all the circumstances in the case, a court of
competent jurisdiction determines such person is fairly and reasonably entitled
to indemnification. Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers, or persons
controlling L.A.M. pursuant to the foregoing provisions, L.A.M. has been
informed that in the opinion of the Securities and Exchange Commission, such
indemnification is against public policy as expressed in the Act and is
therefore unenforceable.

AVAILABLE INFORMATION

L.A.M. is subject to the informational requirements of the Securities
Exchange Act of l934 and in accordance therewith is required to file reports,
proxy statements and other information with the Securities and Exchange
Commission (the "Commission"). Copies of any such reports, proxy statements and
other information filed by L.A.M. can be inspected and copied at the public
reference facility maintained by the Securities and Exchange Commission at Room
1024, 450 Fifth Street, N.W., Washington, D.C. and at the Securities and
Exchange Commission's Regional offices in New York (7 World Trade Center, Suite
1300, New York, New York 10048) and Chicago (Northwestern Atrium Center, 500
West Madison Street, Suite 1400, Chicago, Illinois 60661-2511). Copies of such
material can be obtained from the Public Reference Section of the Securities and
Exchange Commission at its office in Washington, D.C. 20549 at prescribed rates.
Certain information concerning e-Video is also available at the Internet Web
Site maintained by the Securities and Exchange Commission at www.sec.gov. L.A.M.
has filed with the Securities and Exchange Commission a Registration Statement
on Form SB-2 (together with all amendments and exhibits) under the Securities
Act of 1933, as amended (the "Act"), with respect to the Securities offered by
this prospectus. This prospectus does not contain all of the information set
forth in the Registration Statement, certain parts of which are omitted in
accordance with the rules and regulations of the Securities and Exchange
Commission. For further information, reference is made to the Registration
Statement.

FINANCIAL STATEMENTS

L.A.M. PHARMACEUTICAL, CORP.
(A DEVELOPMENT STAGE COMPANY)
(A DELAWARE CORPORATION)
Miami, Florida

TABLE OF CONTENTS
- --------------------------------------------------------------------------------

Independent Auditors' Report F-2

Balance Sheets at December 31, 2000 and 1999 F-3

Statements of Changes in Stockholders' Deficit
for the Years Ended December 31, 2000, 1999 and
1998 and for the Period From the Date of Inception
(February 1, 1994) Through December 31, 200 F-4 to F-6

Statements of Operations for the Years Ended
December 31, 2000, 1999 and 1998 and for the
Period From the Date of Inception (February 1,
1994) Through December 31, 2000 F-7

Statements of Cash Flows for the Years Ended
December 31, 2000, 1999 and 1998 and for the
Period From the Date of Inception (February 1,
1994) Through December 31, 2000 F8 to F-9

Notes to Financial Statements F-10 to F-19

INDEPENDENT AUDITORS' REPORT

To the Board of Directors
and Shareholders
L.A.M. Pharmaceutical, Corp.
Miami, Florida

We have audited the accompanying balance sheets of L.A.M. Pharmaceutical,
Corp. (A Development Stage Company) as of December 31, 2000 and 1999, and the
related statements of changes in stockholders' deficit, operations and cash
flows for each of the three years in the period ended December 31, 2000 and for
the period from the date of inception (February 1, 1994) through December 31,
2000. These financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these financial
statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audits to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of L.A.M. Pharmaceutical, Corp. as
of December 31, 2000 and 1999 and the results of its operations and its cash
flows for each of the three years in the period ended December 31, 2000 and for
the period of inception (February 1, 1994) through December 31, 2000, in
conformity with generally accepted accounting principles.

/s/ Rotenberg & Company, LLP

Rotenberg & Company, LLP
Rochester, New York
February 9, 2001

L.A.M. PHARMACEUTICAL, CORP.
(A DEVELOPMENT STAGE COMPANY)
(A DELAWARE CORPORATION)
Miami, Florida

BALANCE SHEETS
- --------------------------------------------------------------------------------
December 31, December 31,
2000 1999
- --------------------------------------------------------------------------------
ASSETS
Current Assets
Cash and Cash Equivalents $ 1,545,692 $ 558,710
Cash Held by Broker - Debentures 357,250 465,000
Note Receivable - Debentures -- 50,000
Accounts Receivable 75,000 75,000
Inventory - Raw Materials 121,125 --
Prepaid Expenses 2,639 --
- --------------------------------------------------------------------------------
Total Current Assets 2,101,706 1,148,710

Property and Equipment - Net of Accumulated
Depreciation 19,601 4,922

Other Assets
Patents and Trademarks - Net of Accumulated
Amortization 336,196 232,417
- --------------------------------------------------------------------------------
Total Assets $ 2,457,503 $ 1,386,049
- --------------------------------------------------------------------------------

LIABILITIES AND STOCKHOLDERS' DEFICIT
Current Liabilities
Accounts Payable and Accrued Expenses $ 326,762 $ 111,627
Convertible Debentures 1,658,250 1,252,000
- --------------------------------------------------------------------------------
Total Current Liabilities 1,985,012 1,363,627

Non-Current Liabilities
Due to Stockholders 1,266,837 1,390,837
Deferred Royalty Revenue 207,360 207,360
- --------------------------------------------------------------------------------
Total Liabilities 3,459,209 2,961,824
- --------------------------------------------------------------------------------
Stockholders' Deficit
Common Stock - $.0001 Par; 50,000,000 Shares
Authorized; 13,998,930 and 10,392,500
Shares Issued and Outstanding as of
December 31, 2000 and 1999, Respectively 1,400 1,039
Additional Paid in Capital 8,812,199 3,461,483
Deficit Accumulated During Development Stage (9,815,305) (5,038,297)
- --------------------------------------------------------------------------------
Total Stockholders' Deficit (1,001,706) (1,575,775)
- --------------------------------------------------------------------------------
Total Liabilities and Stockholders' Deficit $ 2,457,503 $ 1,386,049
- --------------------------------------------------------------------------------

The accompanying notes are an integral part of this financial statement.

L.A.M. PHARMACEUTICAL, CORP.
(A DEVELOPMENT STAGE COMPANY)
(A DELAWARE CORPORATION)
Miami, Florida

STATEMENTS OF CHANGES IN STOCKHOLDERS' DEFICIT
For the Period From the Date of Inception (February 1, 1994) Through
December 31, 2000
- --------------------------------------------------------------------------------

Deficit
Accumulated
Additional During Total
Common Paid-In Development Stockholders
Shares Stock Capital Stage Equity/(Deficit)
- --------------------------------------------------------------------------------------------------------
Inception - February 1, 1994 -- $ -- $ -- $ -- $ --
Capital Contribution - Services
Rendered -- -- 22,799 -- 22,799
Capital Contribution - Laboratory
Equipment -- -- 24,245 -- 24,245
Net Loss -- -- -- (356,393) (356,393)
- --------------------------------------------------------------------------------------------------------
Balance - December 31, 1994 -- -- 47,044 (356,393) (309,349)
Capital Contribution - Services
Rendered -- -- 172,020 -- 172,020
Net Loss -- -- -- (522,095) (522,095)
- --------------------------------------------------------------------------------------------------------
Balance - December 31, 1995 -- -- 219,064 (878,488) (659,424)
Capital Contribution - Services
Rendered -- -- 185,495 -- 185,495
Capital Contribution - Leasehold
Improvements -- -- 9,775 -- 9,775
Capital Contribution - Interest
Expense -- -- 49,738 -- 49,738
Capital Contribution in Cash -- -- 51,001 -- 51,001
Net Loss -- -- -- (643,733) (643,733)
- --------------------------------------------------------------------------------------------------------
Balance - December 31, 1996 -- $ -- $ 515,073 $(1,522,221) $(1,007,148)
Capital Contribution - Services
Rendered -- -- 377,072 -- 377,072
Capital Contribution - Interest
Expense -- -- 99,477 -- 99,477
Capital Contribution in Cash -- -- 111,199 -- 111,199
Distribution -- -- (30,000) -- (30,000)
Net Loss -- -- -- (499,626) (499,626)
- -------------------------------------------------------------------------------------------------------
Balance - December 31, 1997 -- $ -- $1,072,821 $ (2,021,847) $ (949,026)

-continued-

The accompanying notes are an integral part of this financial statement.

L.A.M. PHARMACEUTICAL, CORP.
(A DEVELOPMENT STAGE COMPANY)
(A DELAWARE CORPORATION)
Miami, Florida

STATEMENTS OF CHANGES IN STOCKHOLDERS' DEFICIT
For the Period From the Date of Inception (February 1, 1994)Through December 31,
2000 - Continued
- --------------------------------------------------------------------------------

Deficit
Accumulated
Additional During Total
Common Paid-In Development Stockholders
Shares Stock Capital Stage Equity/(Deficit)
- --------------------------------------------------------------------------------------------------------
Balance - December 31, 1997 -- -- 1,072,821 (2,021,847) (949,026)
Recapitalization as L.A.M.
Pharmaceutical, Corp. 6,000,000 600 (600) -- --
Capital Contribution - Interest
Expense -- -- 103,579 -- 103,579
Issuance of Common Stock
for Cash 4,332,500 433 378,352 -- 378,785
Distribution -- -- (38,660) -- (38,660)
Net Loss -- -- -- (458,807) (458,807)
- --------------------------------------------------------------------------------------------------------
Balance - December 31, 1998 10,332,500 1,033 1,515,492 (2,480,654) (964,129)
Capital Contribution - Interest
Expense -- -- 107,681 -- 107,681
Issuance of Common Stock
for Cash 60,000 6 59,994 -- 60,000
Stock Options and Awards Granted -
Compensation for Services
Rendered -- -- 526,316 -- 526,316
Conversion Premium on
Convertible Debentures -- -- 1,252,000 -- 1,252,000
Net Loss -- -- -- (2,557,643) (2,557,643)
- -------------------------------------------------------------------------------------------------------
Balance - December 31, 1999 10,392,500 1,039 3,461,483 (5,038,297) (1,575,775)
Capital Contribution - Interest
Expense -- -- 107,686 -- 107,686
Conversion Premium on
Convertible Debentures -- -- 2,395,093 -- 2,395,093
Stock Options and Awards Granted-
Compensation for Services
Rendered -- -- 447,640 -- 447,640
Debentures Converted to Common
Stock 3,319,430 332 2,211,176 -- 2,211,508
Stock Options Exercised 287,000 29 189,121 -- 189,150
Net Loss -- -- -- (4,777,008) (4,777,008)
- --------------------------------------------------------------------------------------------------------
Balance - December 31, 2000 13,998,930 $1,400 $8,812,19 $(9,815,305) $(1,001,706)
- --------------------------------------------------------------------------------------------------------

The accompanying notes are an integral part of this financial statement.

L.A.M. PHARMACEUTICAL, CORP.
(A DEVELOPMENT STAGE COMPANY)
(A DELAWARE CORPORATION)
Miami, Florida

STATEMENTS OF OPERATIONS
For the Years Ended December 31, 2000 and 1999 and for the Period From the Date
of Inception (February 1, 1994) Through
December 31, 2000
- ------------------------------------------------------------------------------
Date of
Inception
(February 1,
1994)
Through
December 31,
2000 1999 1998 2000
- ------------------------------------------------------------------------------
Total Revenue $ -- $ -- $ -- $ 200,000
- ------------------------------------------------------------------------------
Expenses
Research and Development 308,270 185,143 41,372 2,019,069
General and Administrative 1,774,194 906,057 190,052 3,430,467
Interest Expense 291,604 120,625 103,579 665,023
Conversion Premium 2,395,093 1,252,000 -- 3,647,093
Depreciation and
Amortization 36,108 11,159 3,467 78,918
- ------------------------------------------------------------------------------
Total Expenses 4,805,269 2,474,984 338,470 9,840,570
- ------------------------------------------------------------------------------
Loss From Operations (4,805,269)(2,474,984) (338,470) (9,640,570)
- ------------------------------------------------------------------------------
Other Income (Expense)
Interest Income 28,261 2,601 1,763 32,625
Loss on Investment in
Affiliate -- (85,260) (122,100) (207,360)
- ------------------------------------------------------------------------------
Total Other Income (Expense) 28,261 (82,659) (120,337) (174,735)
- ------------------------------------------------------------------------------
Net Loss $(4,777,008)$(2,557,643)$(458,807) $(9,815,305)
- ------------------------------------------------------------------------------
Loss Per Common Share - Basic
and Diluted $ (0.44) $ (0.25) $ (0.05) $ (1.08)
- ------------------------------------------------------------------------------
Weighted Average Number of
Common Shares Outstanding 10,893,116 10,392,500 10,047,917
- --------------------------------------------------------------

The accompanying notes are an integral part of this financial statement.

L.A.M. PHARMACEUTICAL, CORP.
(A DEVELOPMENT STAGE COMPANY)
(A DELAWARE CORPORATION)
Miami, Florida

STATEMENTS OF CASH FLOWS
For the Years Ended December 31, 2000 and 1999 and for
the Period
From the Date of Inception (February 1, 1994) Through December 31, 2000
- --------------------------------------------------------------------------
Date of
Inception
(February 1,
1994)
Through
December 31,
2000 1999 2000
- --------------------------------------------------------------------------
Cash Flows from Operating Activities
Net Loss $(4,777,008) $(2,557,643) $(9,815,305)
Adjustments to Reconcile Net Loss to
Net Cash Flows From Operating
Activities:
Depreciation and Amortization 36,108 11,159 78,918
Capital Contributions:
Interest Expense 107,686 107,681 468,161
Options and Awards Granted 447,640 526,316 1,731,342
Conversion Premium on Debentures 2,395,093 1,252,000 3,647,093
Loss on Investment in Affiliate -- 85,260 207,360
Changes in Assets and Liabilities:
Accounts Receivable -- 39,349 (75,000)
Notes Receivable 50,000 -- 50,000
Inventory - Raw Materials (121,125) -- (121,125)
Prepaid Expenses (2,639) 5,320 (2,639)
Accounts Payable and Accrued
Expenses 366,557 58,683 478,184
Due to Stockholders (124,000) 124,000 1,266,837
Other -- -- --
- --------------------------------------------------------------------------
Net Cash Flows from Operating
Activities (1,621,688) (347,875) (2,086,174)
- --------------------------------------------------------------------------
Cash Flows from Investing Activities
Equipment (37,631) (4,274) (42,717)
Patents and Trademarks (116,932) (166,398) (357,975)
- --------------------------------------------------------------------------
Net Cash Flows from Investing
Activities (154,563) (170,672) (400,692)
- --------------------------------------------------------------------------
Cash Flows from Financing Activities
Cash Capital Contributions -- -- 162,200
Distributions to Stockholders -- -- (68,660)
Proceeds from Issuance of Common Stock -- 60,000 438,785
Proceeds from Convertible Debentures 2,466,333 1,077,000 3,668,333
Note Payable -- (5,320) --
Proceeds from the Exercise of Stock
Options 189,150 -- 189,150
- --------------------------------------------------------------------------
Net Cash Flows from Financing
Activities 2,655,483 1,131,680 4,389,808
- --------------------------------------------------------------------------
Net Increase in Cash and Cash
Equivalents 879,232 613,133 1,902,942
Cash and Cash Equivalents - Beginning 1,023,710 410,577 --
- --------------------------------------------------------------------------
Cash and Cash Equivalents - Ending 1,902,942 1,023,710 1,902,942
- --------------------------------------------------------------------------

The accompanying notes are an integral part of this financial statement.

L.A.M. PHARMACEUTICAL CORP.
(A DEVELOPMENT STAGE COMPANY)
(A DELAWARE CORPORATION)
Miami, Florida

NON-CASH INVESTING AND FINANCING ACTIVITIES

Date of
Inception
(February 1,
1994)
Through
December 31,
2000 1999 2000
- ------------------------------------------------------------------------------

Issuance of Common Stock in Exchange
for Property and Equipment $ -- $ -- $ 34,020
Debentures Converted to Common 2,060,083 $ -- $ 2,060,083
Stock
Investment in Affiliate $ -- $ -- $ 207,360
Deferred Revenue $ -- $ -- $(207,360)
- ------------------------------------------------------------------------------

L.A.M. PHARMACEUTICAL, CORP.
(A DEVELOPMENT STAGE COMPANY)
(A DELAWARE CORPORATION)
Miami, Florida

NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------

Note A -Summary of Transaction
L.A.M. Pharmaceutical, Corp. (the Company) was initially formed as
L.A.M. Pharmaceutical, LLC (the LLC) on February 4, 1997. From February
1, 1994 to February 4, 1997 the Company conducted its activities under
the name RDN. In September 1998, the members of L.A.M. Pharmaceuticals
LLC, a Florida Limited liability company, exchanged all of their
interests in the LLC for 6,000,000 shares of the Company's common stock.
The stock exchange between the Company and the members of the LLC is
considered a recapitalization or reverse acquisition. Under reverse
acquisition accounting, the LLC was considered the acquirer for
accounting and financial reporting purposes, and acquired the assets and
assumed the liabilities of the Company. The accompanying financial
statements include the historical accounts of the Company, the LLC and
RDN since February 1, 1994. All inter-company accounts and transactions
have been eliminated.

Note B - Nature of Operations and Summary of Significant Accounting Policies

L.A.M. Pharmaceutical, Corp. was incorporated on July 24, 1998 under
the laws of the State of Delaware. The Company has the authority to
issue 50,000,000 shares of common stock, $.0001 par value. The Company
is engaged in the research and development of Novel, Proprietary, Long
Lasting Injectable Drugs and Delivery Systems for Transdermal and
Topical Drugs.

Development Stage
The Company has operated as a development stage enterprise since its
inception by devoting substantially all of its efforts to financial
planning, raising capital, research and development, and developing
markets for its products. Accordingly, the financial statements of the
Company have been prepared in accordance with the accounting and
reporting principles prescribed by Statement of Financial Accounting
Standards No. 7, "Accounting and Reporting by Development Stage
Enterprises," issued by the Financial Accounting Standards Board.

Revenue Recognition
Revenues are recognized when earned. On December 31, 1997 the Company
entered into an exclusive world-wide license agreement (the License
Agreement) with Ixora Bio-Medical Company Inc. (Ixora). Under the
License Agreement, Ixora will pay the Company $500,000 for the exclusive
rights of the Company's male and female sexual dysfunction product
technology. In addition, the Company will own 37% of Ixora and will
receive a royalty equal to 9% of the net sales under the License
Agreement. A payment of $200,000, which is non-refundable, has been made
by Ixora to the Company with the balance to be paid in the next quarter.
Such payments will be recorded when received by the Company. Ixora will
also pay for all costs for the full development, registration and
protection of intellectual property, including but not limited to patent
costs, raw material costs, clinical development costs and compensation
of all Company personnel involved in the sexual dysfunction product
technology.

Method of Accounting
The corporation maintains its books and prepares its financial
statements on the accrual basis of accounting.

Use of Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities
and disclosure of contingent assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expense
during the reporting period. Actual results can differ from those
estimates.
- continued -

L.A.M. PHARMACEUTICAL, CORP.
(A DEVELOPMENT STAGE COMPANY)
(A DELAWARE CORPORATION)
Miami, Florida

NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------

Note B - Nature of Operations and Summary of Significant Accounting Policies
- continued

Concentrations of Credit Risk
Financial instruments which potentially expose the Corporation to
significant concentrations of credit risk consist principally of bank
deposits. Cash is placed primarily in high quality short-term interest
bearing financial instruments.

Cash and Cash Equivalents
Cash and cash equivalents include time deposits, certificates of
deposit, and all highly liquid debt instruments with original maturities
of three months or less. The company maintains cash and cash equivalents
at financial institutions that periodically may exceed federally insured
amounts.

Cash Held by Brokers - Debentures
Cash held by brokers- debentures consist of interest bearing term
deposit accounts having maturity dates of three months or less.

Property, Equipment and Depreciation
Property and equipment are stated at cost, less accumulated depreciation
computed using the straight-line method over the estimated useful lives
as follows:

Furniture and Fixtures 5 - 7 Years
Computer Equipment 5 - 7 Years
Leasehold Improvements 5 Years

Maintenance and repairs are charged to expense. The cost of the assets
retired or otherwise disposed of and the related accumulated
depreciation are removed from the accounts.

Patents and Trademarks
Patents are carried at cost and are amortized using the straight-line
method over their estimated useful lives, not to exceed 17 years from
the date of issuance of the patent. Amortization expense for the years
ended December 31, 2000, 1999 and 1998 was $32,055, $8,159 and $467,
respectively.

Research and Development Costs
Research and development expenditures are expensed as incurred.

Net Income (Loss) Per Common Share
Net income (loss) per common share is computed in accordance with SFAS
No. 128, "Earnings Per Share". Basic earnings per common share is
calculated by dividing income available to common shareholders by the
weighted-average number of common shares outstanding for each period.
Diluted earnings per common share is calculated by adjusting the
weighted-average shares outstanding assuming conversion of all
potentially dilutive stock options, warrants and convertible
securities. Diluted earnings per share is the same as basic earnings
per share for all of the periods presented since the effect of the
conversion of the debentures and the stock options and awards granted
would have an anti-dilutive effect on earnings per share.

- continued -

L.A.M. PHARMACEUTICAL, CORP.
(A DEVELOPMENT STAGE COMPANY)
(A DELAWARE CORPORATION)
Miami, Florida

NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------

Note B - Nature of Operations and Summary of Significant Accounting Policies -
continued

Income Taxes
The Company accounts for income taxes in accordance with SFAS No. 109,
"Accounting for Income Taxes," using the asset and liability approach,
which requires recognition of deferred tax liabilities and assets for
the expected future tax consequences of temporary differences between
the carrying amounts and the tax basis of such assets and liabilities.
This method utilizes enacted statutory tax rates in effect for the year
in which the temporary differences are expected to reverse and gives
immediate effect to changes in income tax rates upon enactment. Deferred
tax assets are recognized, net of any valuation allowance, for temporary
differences and net operating loss and tax credit carryforwards.
Deferred income tax expense represents the change in net deferred assets
and liability balances. The Company had no material deferred tax assets
or liabilities for the periods presented. Deferred tax assets arising
from the net operating losses incurred during the development stage have
been fully reserved against due to the uncertainty as to when or whether
the tax benefit will be realized.

Stock Options and Awards
As described in Note K, the corporation has elected to follow the
accounting provisions of Accounting Principles Board Opinion (APBO) No.
25 Accounting for Stock Issued to Employees, for stock-based
compensation and awards made to employees - the intrinsic value method.
Pro forma disclosures required under SFAS No. 123, Accounting for
Stock-Based Compensation has not been furnished due to the short history
of the Company. Stock options granted to investors and consultants are
subject to the provisions of SFAS No. 123 and are recorded at the fair
value of the option at the date of grant.

Note C - Investment in Affiliate

Investment in Affiliate consists of a 37% interest in Ixora Biomedical
Company, Inc. The investment consists of the following at December 31:

Original Investment, January 1, 1998 $ 207,360
Investor's Share of Loss for the Year ending
December 31, 1998 $ (122,100)
-----------

Carrying value of Investment, December 31, 1998 $ 85,260
Investor's Share of Loss for the Year ending
December 31, 1999 $ (85,260)
----------

Carrying value of Investment December 31, 1999 and 2000 $ --
========

Note D - Licensing Agreement
The Company has an exclusive license agreement (the License Agreement)
with Ixora Bio-Medical Company, Inc. (Ixora). Under the License
Agreement, Ixora has agreed to pay the Company $500,000 for the
exclusive rights of the Company's male and female sexual dysfunction
product technology. Ixora has also agreed to pay all costs for the
development, registration and protection of intellectual property,
including but not limited to patent costs, raw material costs, clinical
development costs and compensation of all Company personnel involved in
the sexual dysfunction product technology.

- continued -

L.A.M. PHARMACEUTICAL, CORP.
(A DEVELOPMENT STAGE COMPANY)
(A DELAWARE CORPORATION)
Miami, Florida

NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------

Note E -Property and Equipment

Property and equipment are recorded at cost and consisted of the
following:

-----------------------------------------------------------------
December 31, 2000 1999
-----------------------------------------------------------------
Furniture and Fixtures $37,281 $25,960
Computer Equipment 9,351 3,371
Leasehold Improvements 11,296 9,775
-----------------------------------------------------------------
$57,928 $39,106
Less: Accumulated Depreciation 38,327 34,184
-----------------------------------------------------------------
Net Property and Equipment $19,601 $4,922
-----------------------------------------------------------------

Depreciation expense for the years ended December 31, 2000, 1999 and
1998 was $4,053, $3,000, and $3,000, respectively.

Note F - Due to Stockholders
The Company has a liability for 1996 salaries and other expenses due to
three of its stockholders totaling $1,050,000 and $216,837,
respectively. In addition, the Company is indebted to a principal
stockholder for legal services rendered during 1999 of $124,000. The
Company has agreements with these stockholders, which provides for
payment of this obligation without interest, not to exceed 25% of the
profits realized by the Company in any year. The Company has imputed
interest at 8.5% and charged operations for each of the periods
presented with an offsetting credit to additional paid in capital.

Note G - Deferred Royalty Revenue
Deferred Royalty Revenue represents amounts due to the Company from
Ixora Biomedical pursuant to the worldwide license agreement. The
$207,360 of Deferred Royalty Revenue approximated the value of the
Company's original investment in the affiliate. The balance will be
amortized to income upon commencement of Ixora's sale of the Company's
products.

Note H - Income Taxes
The Company has approximately $7,600,000 of net operating loss
carryforwards for federal tax purposes as of December 31, 2000, which is
available to offset future taxable income and will begin to expire
during the year 2013. The Company has fully reserved for any future tax
benefits from the net operating loss carryforwards since it has not
generated any revenues to date.

- continued -

L.A.M. PHARMACEUTICAL, CORP.
(A DEVELOPMENT STAGE COMPANY)
(A DELAWARE CORPORATION)
Miami, Florida

NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------

Note I - Convertible Debentures
The Company issued convertible debentures during 1999 and 2000 having an
aggregate principal balance of $1,252,000 and $2,466,333, respectively.
These debentures are unsecured obligations of the Company that mature
over twelve months and bear interest at an annualized rate of 9.5%
payable at maturity. The debentures are convertible into common shares
of the Company at various conversion rates (see table below) at any time
at the option of the holder. The common shares issued on conversion have
a restriction as to resale for a period of 1 year from the date that the
original debenture was issued. The Company may also redeem the
debentures at any time upon written notice and payment to the holder of
all unpaid principal and interest. The debentures are not subject to any
sinking fund requirements. Debentures in the amount of $2,060,083 were
converted during the year 2000 into 3,319,430 shares of the Company's
common stock. The Company anticipates that the majority of the holders
of the debentures outstanding in the amount of $1,658,250 as of December
31, 2000 will exercise their conversion options during 2001.

The conversion premium on the convertible debentures at the date if
issuance and the number of common share equivalents outstanding are as
follows:

Number of Excess of Fair
Common Share Conversion Value of Common Conversion
Equivalents Price over Debentures Premium
Issued in 1999
2,504,000 $ 0.50 $ 5,749,400 $ 1,252,000
--------- --------------- -----------

Issued in 2000
530,000 $ 0.50 2,042,000 $ 265,000
40,167 3.00 85,260 85,260
2,500 4.00 --- ---
1,183,334 1.75 2,915,023 2,034,833
--------- --------- ------------
1,756,001 $ 5,708,854 $ 2,385,093
--------- ------------- -----------

Converted in 2000

(3,014,000) $ 0.50
( 290,430) 1.75
( 15,000) 3.00
-------------
Shares Issued (3,319,430)
-------------

Outstanding at
December 31, 2000 940,571
-----------

The excess fair value of the common stock into which the notes can
convert at the conversion date over the proceeds is limited to the
amount of the proceeds of the debentures. Accordingly, $2,385,093 and
$1,252,000 was recorded in 2000 and 1999, respectively, as a charge to
interest expense and a credit to additional paid-in-capital in the
accompanying financial statements.

continued -

L.A.M. PHARMACEUTICAL, CORP.
(A DEVELOPMENT STAGE COMPANY)
(A DELAWARE CORPORATION)
Miami, Florida

NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------

Note J - Stock Options and Awards

The Corporation has elected to follow APBO No.25, Accounting for Stock
Issued to Employees, and related Interpretations in accounting for its
stock-based compensation made to its employees. APBO No. 25 requires no
recognition of compensation expense for most of the stock-based
compensation arrangements provided by the Corporation, namely,
broad-based employee stock purchase plans and option grants where the
exercise price is equal to or less than the market value at the date of
grant. However, APBO No. 25 requires recognition of compensation expense
for variable award plans over the vesting periods of such plans, based
upon the then-current market values of the underlying stock. In
contrast, SFAS No. 123 requires recognition of compensation expense for
grants of stock, stock options, and other equity instruments, over the
vesting periods such as grants, based on the estimated grant-date fair
values of those grants. Stock options and awards made to investors and
consultants are subject to the provisions of SFAS No. 123.

Employees
During 1998, the Company granted stock options for 135,000 shares of
common stock to employees in connection with the original issuance of
shares at exercise prices that were not less than the fair value of the
common stock at the date of grant. During 1999, the Company granted
stock options for 100,000 shares of common stock to employees as
compensation for services rendered at exercise prices that were below
the fair value of the common stock at the date of grant. Accordingly,
the Company recognized compensation expense of $48,000 as a charge
against operations during 1999 for the difference between the fair value
and the exercise price of the common stock at the date of grant.

Consultants
During 2000, the Company granted stock options for 1,421,000 shares of
common stock to consultants as compensation for services rendered at
exercise prices that were not less than the fair value of the common
stock at the date of grant. Accordingly, the Company recognized
compensation expense as a charge against operations during 2000 of
$447,640 for the fair value of the options at the date of grant using a
Black Scholes option-pricing model.

During 1999, the Company granted stock options for 358,333 shares of
common stock to consultants as compensation for services rendered at
exercise prices that were below the fair value of the common stock at
the date of grant. Accordingly, the Company recognized compensation
expense as a charge against operations during 1999 of $272,057 for the
fair value of the options at the date of grant using a Black Scholes
option-pricing model.

During 1998, the Company granted stock options for 238,000 shares of
common stock to consultants in connection with the original issuance of
shares at exercise prices that were not less than the fair value of the
common stock at the date of grant. The fair market value of the options
was determined by using a Black Scholes option pricing model. Due to the
short trading history, the low and infrequent volume of trades, and the
market volatility of the company's stock the calculated fair value at
the date of the grant was zero. The assumptions used were as follows:

2000 1999 1998
------ ------ ----
Weighted Average Fair Value of
Common Stock $3.40 $2.23 $.50
Weighted Average Exercise Price $3.63 $1.53 $.70
Expected Market Volatility 10.0% 10.0% 5.0%
Risk Free Interest Rates 4.50% - 6.00% 4.66% - 5.50% 5.0%
Terms 24 - 60 Months 3 - 36 Months 24-36 Months

continued

L.A.M. PHARMACEUTICAL, CORP.
(A DEVELOPMENT STAGE COMPANY)
(A DELAWARE CORPORATION)
Miami, Florida

NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------

Note J - Stock Options and Awards - continued

In December 1999, the Company granted an award of 25,000 shares of
common stock as compensation to an outside consultant. The Company has
charged operations for the fair value of the common stock awarded on the
date of the grant in the amount of $106,250.

Investors
During 1999, the Company granted stock options for 61,633 shares of
common stock to investors. The Company recognized a charge against
operations during 1999 of $100,009 for the fair value of the options at
the date of grant using a Black Scholes option-pricing model.

During 1998, the Company granted stock options for 367,500 shares of
common stock to investors in connection with the original issuance of
shares at exercise prices that were not less than the fair value of the
common stock at the date of grant. The fair market value of the options
was determined by using a Black Scholes option pricing model. Due to the
short trading history, the low and infrequent volume of trades, and the
market volatility of the company's stock the calculated fair value at
the date of the grant was zero. The assumptions used were as follows:

1999 1998

Weighted Average Fair Value of Common Stock $2.23 $.50
Weighted Average Exercise $1.53 $.70
Expected Market Volatility 10.0% 5.0%
Risk Free Interest Rates 4.66% - 5.50% 5.0%
Terms 3 - 24 Months 24-36 Months

Stock option transactions for the three years ending December 31, 2000
are summarized as follows:

Weighted Average
Number Exercise Price
- ----------------------------------------------------------------------------
Outstanding at January 1, 1998 --- ---
Granted 740,500 $ 0.70
Exercised --- ---
Forfeited/Expired --- ---
-------------------------------------------------------------------
Outstanding at December 31, 1998 740,500 $ 0.70
Granted 519,966 1.36
Exercised --- ---
Forfeited/Expired --- ---
--------------------------------------------------------------------
Outstanding at December 31, 1999 1,260,466 $ 0.97
Granted 1,421,000 3.63
Exercised (287,000) .66
Forfeited/Expired --- ---
--------------------------------------------------------------------
Outstanding at December 31, 2000 2,394,466 $ 2.84
--------------------------------------------------------------------

- continued -

L.A.M. PHARMACEUTICAL, CORP.
(A DEVELOPMENT STAGE COMPANY)
(A DELAWARE CORPORATION)
Miami, Florida

NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------

Note J - Stock Options and Awards - continued

Information related to stock options issued during the three years ended
December 31, 2000 is as follows:

Grant Exercise
Shares Date Term Price
------ ----- ---- ----------
Options Issued:
1998 218,000 Sept 1998 24 Months $.65
185,500 Sept 1998 36 Months .65
162,000 Oct 1998 24 Months .65
75,000 Nov 1998 24 Months .65
100,000 Dec 1998 36 Months 1.00
-------
740,500

1999 30,000 Mar 1999 24 Months .65
250,000 Oct 1999 18 Months .65
100,000 Nov 1999 36 Months .65
39,966 Dec 1999 3 Months 1.50
100,000 Dec 1999 36 Months 4.00
-------
519,966

2000 50,000 Jan 2000 36 Months 4.04
10,000 June 2000 60 Months 4.50
50,000 Sept 2000 36 Months 4.00
100,000 Oct 2000 48 Months 4.00
150,000 Oct 2000 36 Months 4.00
225,000 Nov 2000 36 Months 3.50
836,000 Nov 2000 24 Months 3.50
---------
1,421,000
Options Exercised:
2000 (287,000)
---------

Outstanding at
December 31, 2000 2,394,466
=========

All of the above outstanding options are fully vested and exercisable.

continued -

L.A.M. PHARMACEUTICAL, CORP.
(A DEVELOPMENT STAGE COMPANY)
(A DELAWARE CORPORATION)
Miami, Florida

NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------

Note K - Common and Preferred Stock

Common Stock

L.A.M. is authorized to issue 50,000,000 shares of common stock. Holders of
common stock are each entitled to cast one vote for each share held of
record on all matters presented to shareholders. Cumulative voting is not
allowed; hence, the holders of a majority of the outstanding common stock
can elect all directors.

Holders of common stock are entitled to receive such dividends as may be
declared by the Board of Directors out of funds legally available therefore
and, in the event of liquidation, to share pro rata in any distribution of
L.A.M.'s assets after payment of liabilities. The Board of Directors is not
obligated to declare a dividend and it is not anticipated that dividends
will be paid until L.A.M. is in profit.

Holders of common stock do not have preemptive rights to subscribe to
additional shares if issued by L.A.M.. There are no conversion, redemption,
sinking fund or similar provisions regarding the common stock.

Preferred Stock

L.A.M. is authorized to issue up to 5,000,000 shares of preferred stock.
L.A.M.'s Articles of Incorporation provide that the Board of Directors has
the authority to divide the preferred stock into series and, within the
limitations provided by Delaware statute, to fix by resolution the voting
power, designations, preferences, and relative participation, special
rights, and the qualifications, limitations or restrictions of the shares of
any series so established. As the Board of Directors has authority to
establish the terms of, and to issue, the preferred stock without
shareholder approval, the preferred stock could be issued to defend against
any attempted takeover of L.A.M..

Note L - Subsequent Events

Equity Line of Credit Agreement

On January 24, 2001, L.A.M. entered into an equity line of credit
agreement with Hockbury Limited in order to establish a possible source of
funding for the development of L.A.M.'s technology. The equity line of
credit agreement establishes what is sometimes also referred to as an
equity drawdown facility.

Under the equity line of credit agreement, Hockbury Limited has agreed to
provide L.A.M. with up to $20,000,000 of funding during the twenty-month
period following the date of an effective registration statement. During
this twenty-month period, L.A.M. may request a drawdown under the equity
line of credit by selling shares of its common stock to Hockbury Limited,
and Hockbury Limited will be obligated to purchase the shares. L.A.M. may
request a drawdown once every 27 trading days, although L.A.M. is under no
obligation to request any drawdowns under the equity line of credit.

- - continued -

MEDCOM USA, INCORPORATED AND SUBSIDIARIES
Notes to Consolidated Financial Statements

L.A.M. PHARMACEUTICAL, CORP.
(A DEVELOPMENT STAGE COMPANY)
(A DELAWARE CORPORATION)
Miami, Florida

NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------

Note L - Subsequent Events - continued

During the 22 trading days following a drawdown request, L.A.M. will
calculate the amount of shares it will sell to Hockbury Limited and the
purchase price per share. The purchase price per share of common stock
will based on the daily volume weighted average price of L.A.M.'s common
stock during each of the 22 trading days immediately following the
drawdown date, less a discount of 10%. L.A.M. will receive the purchase
price less a placement agent fee payable to GKN Securities equal to 7% of
the aggregate purchase price. Hockbury Limited may then resell all or a
portion of these shares. GKN Securities is the placement agent which
introduced Hockbury Limited to L.A.M. and is a registered broker-dealer.

The minimum amount L.A.M. can draw down at any one time is $100,000. The maximum
amount L.A.M. can draw down at any one time is the lesser of $1,000,000 or the
amount equal to:

o 4.5% of the weighted average price of L.A.M.'s common stock for the
sixty calendar days prior to the date of the drawdown request
o multiplied by the total trading volume of L.A.M.'s common stock for the
sixty calendar days prior to the date of the drawdown request.

Grant of Warrants

Upon closing of the equity line of credit Agreement, L.A.M. paid to Hockbury
Limited's legal counsel, Epstein Becker & Green P.C., $25,000 to cover its legal
and administrative expenses.

As consideration for extending the equity line of credit, L.A.M. granted
Hockbury Limited warrants to purchase 482,893 shares of common stock at a price
of $ 4.56 per share at any time prior to January 24, 2004. As partial
consideration for GKN Securities' services as placement agent in connection with
this offering, L.A.M. granted GKN Securities warrants to purchase 455,580 shares
of common stock at a price of $4.83 per share at any time prior to January 24,
2006. GKN Securities subsequently assigned warrants to purchase 209,500 shares
to four employees of GKN Securities.

L.A.M. PHARMACEUTICAL, CORP.
(A DEVELOPMENT STAGE COMPANY)
(A DELAWARE CORPORATION)

-------------------------------------
FINANCIAL REPORTS
AT
JUNE 30, 2001 and 2000
-------------------------------------

L.A.M. PHARMACEUTICAL, CORP.
(A DEVELOPMENT STAGE COMPANY)
(A DELAWARE CORPORATION)

TABLE OF CONTENTS
- ------------------------------------------------------------------------------

Independent Accountants' Report on Unaudited Interim Financial Data F-2

Balance Sheets at June 30, 2001 (Unaudited) and December 31, 2000 F-3

Statements of Changes in Stockholders' Deficit for the Three and
Six Months Ended June 30, 2001 and 2000 (Unaudited) F-4 to F-5

Statements of Operations for the Three Months and Six Months
Ended June 30, 2001 And 2000 and for the Period From the Date
of Inception (February 1, 1994) Through June 30, 2001 (Unaudited) F-6

Statements of Cash Flows for the Three Months and Six Months
Ended June 30, 2001 and 2000 and for the Period From the
Date of Inception (February 1, 1994) Through June 30, 2001
(Unaudited) F-7 to F-8

Notes to Financial Statements F-9 to F-11

INDEPENDENT ACCOUNTANTS' REPORT

To the Board of Directors
L.A.M. Pharmaceutical, Corp.

We have reviewed the accompanying balance sheet of L.A.M. Pharmaceutical,
Corp. (a Development Stage Company) (A Delaware Corporation) as of June 30, 2001
and the related statements of operations, changes in stockholders' deficit and
cash flows for the three months and six months ended June 30, 2001 and 2000 and
for the period from the date of inception (February 1, 1994) through June 30,
2001. All information included in these financial statements is the
representation of the Company's management.

We conducted our review in accordance with standards established by the
American Institute of Certified Public Accountants. A review of interim
financial information consists principally of applying analytical procedures and
making inquiries of persons responsible for financial and accounting matters. It
is substantially less in scope than an audit in accordance with generally
accepted auditing standards in the United States of America, the objective of
which is the expression of an opinion regarding the financial statements taken
as a whole. Accordingly, we do not express such an opinion.

Based on our review, we are not aware of any material modifications that
should be made to the accompanying financial statements in order for them to be
in conformity with generally accepted accounting principles in the United States
of America.

We have previously audited, in accordance with auditing standards,
generally accepted in the United States, the balance sheet as of December 31,
2000 (presented herein), and the related statements of operations, changes in
stockholders' deficit and cash flows for the year then ended, and for the period
from the date of inception (February 1, 1994) through December 31, 2000 (not
presented herein), and in our report dated February 9, 2001, we expressed an
unqualified opinion on those financial statements. We have not performed any
auditing procedures subsequent to the date of our previous report.

/s/ Rotenberg & Company, LLP
Rochester, New York
August 9, 2001

L.A.M. PHARMACEUTICAL, CORP.
(A DEVELOPMENT STAGE COMPANY)
(A DELAWARE CORPORATION)

BALANCE SHEETS
(Unaudited)
June 30, December 31,
2001 2000
ASSETS

Current Assets
Cash and Cash Equivalents $ 928,488 $ 1,545,692
Cash Held by Broker - Debentures -- 357,250
Loan Receivable - Officer 985,000 --
Accounts Receivable 20,931 75,000
Inventory - Raw Materials 114,750 121,125
Prepaid Expenses -- 2,639
------------- -----------

Total Current Assets 2,049,169 2,101,706

Property and Equipment - Net of
Accumulated Depreciation 121,897 19,601

Other Assets
Patents and Trademarks - Net of Accumulated
Amortization 310,206 336,196
------------ -------------
Total Assets $ 2,481,272 $ 2,457,503

LIABILITIES AND STOCKHOLDERS' DEFICIT

Current Liabilities
Accounts Payable and Accrued Expenses $ 551,341 $ 326,762
Convertible Debentures 1,391,250 1,658,250
---------------- ---------------
Total Current Liabilities 1,942,591 1,985,012

Non-Current Liabilities
Due to Stockholders $ 1,241,837 $ 1,266,837
Deferred Royalty Revenue 207,360 207,360
-------------- ----------------
Total Liabilities $ 3,391,788 $ 3,459,209

Stockholders' Deficit
Common Stock - $.0001 Par; 50,000,000
Shares Authorized; 14,848,251 and
13,998,930 Shares Issued and Outstanding
as of June 30, 2001 and December 31,
Respectively 1,485 1,400
Additional Paid in Capital 11,485,732 8,812,199
Deficit Accumulated During Development Stage (12,397,733) (9,815,305)
------------- ---------------
Total Stockholders' Deficit (910,516) (1,001,706)
--------------- ---------------
Total Liabilities and Stockholders'
Deficit $ 2,481,272 $ 2,457,503
============ =============

The accompanying notes are an integral part of this financial statement.

L.A.M. PHARMACEUTICAL, CORP.
(A DEVELOPMENT STAGE COMPANY)
(A DELAWARE CORPORATION)

STATEMENTS OF CHANGES IN STOCKHOLDERS' DEFICIT
For the Three and Six Months Ended June 30, 2001 and 2000 (Unaudited)
- --------------------------------------------------------------------------------

Deficit
Accumulated
Additional During Total
Common Paid-In Development Stockholders
Shares Stock Capital Stage Equity/(Deficit)
------ ------ ------- ----------- ----------------

Balance - December 31, 1999 10,392,500 $ 1,039 $ 3,384,823 $ (5,038,297) $ (1,652,435)

Capital Contribution - Interest -- -- 26,923 -- 26,923

Stock Options Issued -- -- 76,660 -- 76,660

Conversion Premium on
Convertible Debentures -- -- 265,000 -- 265,000

Net Loss - Restated (Unaudited) -- -- -- (724,566) (724,566)
-------- ------- ------- ---------- ------------

Balance - March 31, 2000 10,392,500 1,039 $ 3,753,406 (5,762,863) $ (2,008,418)

Capital Contribution - Interest
Expense -- -- 26,923 -- 26,923

Conversion Premium on
Convertible Debentures -- -- 10,000 -- 10,000

Net Loss for the Period -
(Unaudited) -- -- -- (191,801) (191,801)
-------------- ---------- ---------- ----------- ---------

Balance - June 30, 2000 10,392,500 $ 1,039 $ 3,790,329 $(5,954,664) $(2,163,296)
=======================================================================

The accompanying notes are an integral part of this financial statement.

L.A.M. PHARMACEUTICAL, CORP.
(A DEVELOPMENT STAGE COMPANY)
(A DELAWARE CORPORATION)

STATEMENTS OF CHANGES IN STOCKHOLDERS' DEFICIT
For the Three and Six Months Ended June 30, 2001 and 2000 (Unaudited)

Deficit
Accumulated
Additional During Total
Common Paid-In Development Stockholders
Shares Stock Capital Stage Equity/(Deficit)
------ ------ ------- ----------- ----------------

Balance - December 31, 2000 13,998,930 $ 1,400 $ 8,812,199 $(9,815,305) $ (1,001,706)

Capital Contribution -
Interest Expense -- -- 26,920 -- 26,920

Debentures Converted to
Common Stock 107,300 11 197,716 -- 197,727

Stock Options Exercised 173,000 17 112,433 -- 112,450

Common Shares Issues as
Compensation for Services
Rendered 10,000 1 9,999 -- 10,000

Warrants Issued to Hockbury
Limited
and GKN Securities -- -- 1,100,000 -- 1,100,000

Net Loss for the Period -
(Unaudited) -- -- -- (1,667,723) (1,667,723)
-------------- --------- ----------- ------------- --------------

Balance - March 31, 2001 14,289,230 $ 1,429 $ 10,259,267 $(11,483,028) $ (1,222,332)
---------- -------- ----------- ------------- -------------

Capital Contribution - Interest
Expense -- -- 28,185 -- 28,185

Debentures Converted to
Common Stock 20,000 2 9,998 -- 10,000

Common Shares Issued as
Compensation for Services
Rendered 100,000 10 299,990 -- 300,000

Stock Options Issued -- -- 404,700 -- 404,700

Sale of Shares Under the
Equity
Line of Credit Agreement 439,021 44 483,592 --
483,636

Net Loss for the Period -
(Unaudited) -- -- -- (914,750) (914,750)
-------------- --------- ------------ ------------ -----------

Balance - June 30, 2001 14,848,251 $ 1,485 $11,485,732 $(12,397,733) $(910,516)
========== ======== =========== ============= ============

L.A.M. PHARMACEUTICAL, CORP.
(A DEVELOPMENT STAGE COMPANY)
(A DELAWARE CORPORATION)

STATEMENTS OF OPERATIONS For the Three Months and Six Months Ended June 30, 2001
and 2000 and for the Period From the Date of Inception (February 1, 1994)
Through June 30, 2001

(Unaudited) (Unaudited) (Unaudited)
Six Months Ended Quarter Ended Date of Inception
June 30, June 30, (February 1, 1994)
Through
2001 2000 2001 2000 June 30, 2001
-------------------------------------------------------------
Licensing Revenue $ 300,000 $ -- $ 300,000 $ -- $ 500,000
-------------------------------------------------------------
Expenses
Research and Development 140,725 113,969 62,309 22,904 2,159,794

General and Administrative 809,630 407,545 397,982 101,048 4,240,097
Warrants Issued - Equity Line
of Credit 1,100,000 -- -- -- 1,100,000

Stock Compensation - Officer 300,000 -- 300,000 -- 300,000

Options and Awards Granted
Officers and Directors 95,500 -- 85,500 -- 414,700

Investors and Investor
Relations Consultants 319,200 -- 319,200 --
Interest Expense 121,336 120,376 60,187 60,188 786,359
Conversion Premium on
Convertible Debentures -- 275,000 -- 10,000 3,647,093
Depreciation and Amortization 17,501 13,122 10,458 8,577 96,419
-----------------------------------------------------------

Total Expenses 2,903,892 930,012 1,235,636 202,717 12,744,462
------------------------------------------------------------------

Loss From Operations (2,603,892) (930,012) (935,636) (202,717) (12,244,462)
-------------------------------------------------------------------------

Other Income (Expense)
Interest Income 21,464 13,663 20,931 10,916 54,089
Loss on Investment in
Affiliate -- -- -- -- (207,360)
-----------------------------------------------------------------

Total Other Income (Expense) 21,464 13,663 20,931 10,916 (153,271)
---------------------------------------------------------------

Net Loss (2,582,428) (916,349) (914,705) (191,801) (12,397,733)
--------------------------------------------------------------------
Loss Per Common Share -
Basic and Diluted $ (0.18) $ (0.09) $ (0.06) $ (0.02) $ (1.26)
--------------------------------------------------------------------
Weighted Average Number
of Common Shares
Outstanding 14,321,846 10,392,500 14,241,358 10,392,500
-----------------------------------------------------------

L.A.M. PHARMACEUTICAL, CORP.
(A DEVELOPMENT STAGE COMPANY)
(A DELAWARE CORPORATION)

STATEMENTS OF CASH FLOWS For the Three Months and Six Months Ended June 30, 2001
and 2000 and for the Period From the Date of Inception (February 1, 1994)
Through June 30, 2001

(Unaudited) (Unaudited) (Unaudited)
Six Months Ended Quarter Ended Date of Inception
June 30, June 30, (February 1, 1994)
Through
2001 2000 2001 2000 June 30, 2001

Cash Flows from Operating
Activities
Net Loss $(2,582,428) $(916,349) $(914,705) $ (191,801) $ (12,397,733)
Adjustments to Reconcile Net
Loss to Net Cash Flows
From Operating Activities:
Depreciation and
Amortization 17,501 13,122 10,458 8,597 96,419
Capital Contributions:
Services Rendered Including
Stock Compensation - Officer 300,000 -- 300,000 -- 300,000
Options and Awards Granted
Officers and Directors 95,500 -- 85,500 -- 2,146,042
Investors and Investor
Relations Consultants 319,200 -- 319,200 --
Warrants Issued - Equity Line
of Credit 1,100,000 -- -- -- 1,100,000
Conversion Premium on
Convertible Debentures -- 275,000 -- 10,000 3,647,093
Interest Expense 55,105 87,111 28,185 26,923 523,266
Loss on Investment in
Affiliate -- -- -- -- 207,360
Changes in Assets and
Liabilities:
Accounts Receivable 54,069 -- 54,069 -- (20,931)
Inventory 6,375 (25,000) 6,375 (25,000) (114,750)
Prepaid Expenses 2,639 (7,917) 6,460 22,083 --
Accounts Payable and
Accrued Expenses 225,306 124,338 170,344 121,594 703,490
Due to Stockholders (25,000) (124,000) (25,000) (124,000) 1,241,837
Other -- -- (467) --
Net Cash Flows from Operating
Activities (431,733) (573,695) 40,886 (152,071) (2,567,907)
----------------------------------------------------------------
Cash Flows from Investing
Activities
Equipment (85,137) (14,942) (23,704) (1,738) (127,854)
Patents and Trademarks (8,670) (54,899) 16,462 -- (366,645)
Loans to an Officer (985,000) -- 40,000 -- (985,000)
---------------------------------------------------------------
Net Cash Flows from Investing
Activities (1,078,807) (69,841) 32,758 (1,738) (1,479,499)
---------------------------------------------------------------

L.A.M. PHARMACEUTICAL, CORP.
(A DEVELOPMENT STAGE COMPANY)
(A DELAWARE CORPORATION)

STATEMENTS OF CASH FLOWS For the Three Months and Six Months Ended June 30, 2001
and 2000 and for the Period From the Date of Inception (February 1, 1994)
Through June 30, 2001

(Unaudited) (Unaudited) (Unaudited)
Six Months Ended Quarter Ended Date of Inception
June 30, June 30, (February 1, 1994)
Through
2001 2000 2001 2000 June 30, 2001

Cash Flows from Financing
Activities
Cash Capital Contributions -- -- -- -- 162,200
Proceeds from Issuance of
Common Stock -- -- -- -- 438,785
Proceeds from (Repayment) of
Convertible Debentures (60,000) 275,000 (60,000) 10,000 3,658,333
Proceeds from Exercise of
Stock Options 112,450 -- -- -- 301,600
Sale of Shares Under the Equity
Line of Credit Agreement 483,636 -- 483,636 -- 483,636
Distributions to Stockholders -- -- -- -- (68,660)
------------------------------------------------------------
Net Cash Flows from Financing
Activities 536,086 275,000 423,636 10,000 4,975,894
-----------------------------------------------------------
Net Increase in Cash and Cash
Equivalents (974,454) (368,536) 497,280 (143,809) 928,488

Cash and Cash Equivalents -
Beginning of Period 1,902,942 1,023,710 431,208 798,983 --
---------------------------------------------------------------
Cash and Cash Equivalents -
End of Year $ 928,488 $ 655,174 $ 928,488 $ 655,174 $ 928,488
-------------------------------------------------------------

NON-CASH INVESTING AND
FINANCING ACTIVITIES

Issuance of Common Stock in
Exchange for Property and
Equipment $ -- $ -- $ -- $ -- $ 34,020
Debentures Converted to
Common Stock $ 207,000 $ -- $ (10,000) $ -- $2,247,083
Investment in Affiliate $ -- $ -- $ -- $ -- $ 207,360
Deferred Royalty Revenue $ -- $ -- $ -- $ -- $ (207,360)
-----------------------------------------------------------------

L.A.M. PHARMACEUTICAL, CORP.
(A DEVELOPMENT STAGE COMPANY)
(A DELAWARE CORPORATION)

NOTES TO FINANCIAL STATEMENTS
- -------------------------------

Note A - Basis of Presentation
The condensed financial statements of L.A.M. Pharmaceutical, Corp.
(L.A.M.) included herein have been prepared by L.A.M., without audit,
pursuant to the rules and regulations of the Securities and Exchange
Commission (the "SEC"). Certain information and footnote disclosures
normally included in financial statements prepared in conjunction with
generally accepted accounting principles have been condensed or
omitted pursuant to such rules and regulations, although L.A.M.
believes that the disclosures are adequate to make the information
presented not misleading. These condensed financial statements should
be read in conjunction with the annual audited financial statements
and the notes thereto included elsewhere in this prospectus.

The accompanying unaudited interim financial statements reflect all
adjustments of a normal and recurring nature that are, in the opinion
of management, necessary to present fairly the financial position,
results of operations and cash flows of L.A.M. for the interim periods
presented. The results of operations for these periods are not
necessarily comparable to, or indicative of, results of any other
interim period or for the calendar year taken as a whole. Factors that
affect the comparability of financial data from year to year and for
comparable interim periods include non-recurring expenses associated
with L.A.M.'s registration with the Securities and Exchange Commission
and costs incurred to raise capital and acquisitions of patents and
trademarks.

Note B - Loan Receivable - Director
Between February and April 2001, Alan Drizen, the Company's President,
borrowed $1,075,000 from L.A.M. The amounts borrowed were used by Mr.
Drizen to purchase shares of L.A.M.'s common stock in an effort to
stabilize the share price in the face of extensive short selling of
the shares. The amounts advanced to Mr. Drizen are repayable no later
than December 31, 2001. Mr. Drizen has agreed to to secure the
repayment of this note by pledging his personal securities, real
estate assets and any other obligations the Board of Directors deems
necessary to secure the repayment of the borrowed amounts. The loan
bears interest at 8.5% per annum. Repayment of the loan began in June,
2001 and the balance as of June 30, 2001 was $985,000.

Note C - Equity Line of Credit Agreement On January 24, 2001, L.A.M.
entered into an equity line of credit agreement with Hockbury Limited
in order to establish a possible source of funding for the development
of L.A.M.'s technology. The equity line of credit agreement
establishes what is sometimes also referred to as an equity drawdown
facility.

Under the equity line of credit agreement, Hockbury Limited has agreed
to provide L.A.M. with up to $20,000,000 of funding during the
twenty-month period following the date of an effective registration
statement. During this twenty-month period, L.A.M. may request a
drawdown under the equity line of credit by selling shares of its
common stock to Hockbury Limited, and Hockbury Limited will be
obligated to purchase the shares. L.A.M. may request a drawdown once
every 27 trading days, although L.A.M. is under no obligation to
request any drawdowns under the equity line of credit.

- continued -

L.A.M. PHARMACEUTICAL, CORP.
(A DEVELOPMENT STAGE COMPANY)
(A DELAWARE CORPORATION)

NOTES TO FINANCIAL STATEMENTS
- -------------------------------------

Note C - Equity Line of Credit Agreement - continued

During the 22 trading days following a drawdown request, L.A.M. will
calculate the amount of shares it will sell to Hockbury Limited and
the purchase price per share. The purchase price per share of common
stock will based on the daily volume weighted average price of
L.A.M.'s common stock during each of the 22 trading days immediately
following the drawdown date, less a discount of 10%. L.A.M. will
receive the purchase price less a placement agent fee payable to GKN
Securities equal to 7% of the aggregate purchase price. Hockbury
Limited may then resell all or a portion of these shares. GKN
Securities is the placement agent which introduced Hockbury Limited to
L.A.M. and is a registered broker-dealer.

The minimum amount L.A.M. can draw down at any one time is $100,000.
The maximum amount L.A.M. can draw down at any one time is the lesser
of $1,000,000 or the amount equal to:

o 4.5% of the weighted average price of L.A.M.'s common stock for the
sixtycalendar days prior to the date of the drawdown request

o multiplied by the total trading volume of L.A.M.'s common stock for the
sixty calendar days prior to the date of the drawdown request.

Upon closing of the equity line of credit Agreement, L.A.M. paid to
Hockbury Limited's legal counsel, Epstein Becker & Green P.C., $25,000
to cover its legal and administrative expenses.

Grant of Warrants As consideration for extending the equity line of
credit, L.A.M. granted Hockbury Limited warrants to purchase 482,893
shares of common stock at a price of $ 4.56 per share at any time prior
to January 24, 2004. As partial consideration for GKN Securities'
services as placement agent in connection with this offering, L.A.M.
granted GKN Securities warrants to purchase 455,580 shares of common
stock at a price of $4.83 per share at any time prior to January 24,
2006. GKN Securities subsequently assigned warrants to purchase 209,500
shares to four employees of GKN Securities.

The fair value of these warrants using customary pricing models was
approximately $1,100,000 and is reflected in L.A.M.'s financial
statements and recorded as an expense during the six months ended June
30, 2001.

As of June 30, 2001, Hockbury Limited had purchased 439,021 shares of
common stock at a price of $483,636 under the equity line of credit
agreement.

Note D - Repricing of Options

During the quarter ended June 30, 2001 the Company elected to reprice
certain outstanding stock options. The repricing did not have a
material impact on operations for the three and six month periods
ended June 30, 2001.

TABLE OF CONTENTS
Page
PROSPECTUS SUMMARY ..................................................
RISK FACTORS .........................................................
COMPARATIVE SHARE DATA ..............................................
MARKET FOR COMMON STOCK .............................................
MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION ...........
BUSINESS............................................................
MANAGEMENT..........................................................
PRINCIPAL SHAREHOLDERS..............................................
SELLING STOCKHOLDERS................................................
DESCRIPTION OF SECURITIES..........................................
LEGAL PROCEEDINGS..................................................
EXPERTS............................................................
INDEMNIFICATION....................................................
AVAILABLE INFORMATION..............................................
FINANCIAL STATEMENTS..............................................

No dealer, salesperson or other person has been authorized to give any
information or to make any representation not contained in this prospectus, and
if given or made, such information or representations must not be relied upon as
having been authorized by wowtown.com. This prospectus does not constitute an
offer to sell, or a solicitation of an offer to buy, any of the securities
offered in any jurisdiction to any person to whom it is unlawful to make such an
offer in such jurisdiction. Neither the delivery of this prospectus nor any sale
made in this prospectus shall, under any circumstances, create any implication
that the information in this prospectus is correct as of any time subsequent to
the date of this prospectus or that there has been no change in the affairs of
wowtown.com since such date.

PART II
Information Not Required in Prospectus

Item 24. Indemnification of Officers and Directors

The Delaware General Corporation Law and L.A.M.'s Certificate of
Incorporation and Bylaws provide that we may indemnify any and all of its
officers, directors, employees or agents or former officers, directors,
employees or agents, against expenses actually and necessarily incurred by them,
in connection with the defense of any legal proceeding or threatened legal
proceeding, except as to matters in which such persons shall be determined to
not have acted in good faith and in our best interest.

Item 25. Other Expenses of Issuance and Distribution.

The following table sets forth the costs and expenses payable by us in
connection with the issuance and distribution of the securities being registered
hereunder. No expenses shall be borne by the selling stockholder. All of the
amounts shown are estimates, except for the SEC Registration Fees.

SEC Filing Fee $ 530
Blue Sky Fees and Expenses 100
Printing and Engraving Expenses 100
Legal Fees and Expenses 20,000
Accounting Fees and Expenses 3,000
Miscellaneous Expenses 1,270
---------
TOTAL $25,000

All expenses other than the SEC and NASD filing fees are estimated.

Item 26. Recent Sales of Unregistered Securities.

A. In September 1998 L.A.M. acquired all of the issued and outstanding shares
of LAM Pharmaceuticals LLC ("LAM") for 6,000,000 shares of L.A.M.'s common
stock. At the time of acquisition LAM had the rights to the proprietary
drug delivery technology and pharmaceuticals that are being developed by
L.A.M..

B. In September 1998 L.A.M. sold 3,930,000 shares of its common stock to
twelve persons for $39,300, or $0.01 per share, and sold 63,000 shares of
its common stock to 61 persons for $6,300, or $0.10 per share. Between
October 1998 and October 1999 L.A.M. sold 399,500 shares of its common
stock to 18 persons for $399,500, or $1.00 per share.

C. Between July 1999 and December 2000 L.A.M. sold convertible notes in the
principal amount of $3,658,333 to 67 private investors. The notes bear
interest at an annual non-compound rate of 9.5% and are due and payable
between January and November 2001. At the option of the holder the amount
of the principal may be converted into shares of L.A.M.'s common stock.

D. During the year ended December 31, 2000 L.A.M. issued 3,319,430 shares of
common stock upon the conversion of certain of the notes described in C
above.

E. Between July and December 2000 L.A.M. issued 287,000 shares of common stock
to thirteen persons as a result of the exercise of options held by these
persons.

F. During the six months ended June 30, 2001 L.A.M. issued 173,000 shares of
common stock to three persons as a result of the exercise of options held
by these persons.

G. In January 2001 L.A.M. issued 10,000 shares of common stock to one person
for services rendered.

H. In January 2001 L.A.M. issued warrants to Hockbury Limited and GKN
Securities Corp.

I. In June 2001 L.A.M. issued 100,000 shares of common stock to one person for
services rendered.

J. During the six months ended June 30, 2001 L.A.M. issued 127,300 shares of
common stock upon the conversion of certain of the notes described in C
above.

The sales of shares referenced in Note B were exempt from registration
pursuant to Rule 504 of the Securities and Exchange Commission. At the time of
these sales L.A.M. was not subject to the reporting requirements of the
Securities Exchange Act of 1934 and the total amount received by L.A.M. from the
sale of these shares was less than $1,000,000. No underwriters were involved
with the sale of these securities and no commissions or other forms of
remuneration were paid to any person in connection with these sales.

The sale of the common stock, convertible notes and warrants referenced in
Notes A, C, E, F, G, H, and I were exempt transactions under Section 4(2) of the
Securities Act of 1933 as transactions by an issuer not involving a public
offering. The shareholders of LAM and the holders of the convertible notes
acquired these securities for investment purposes only and without a view to
distribution. At the time the shareholders of Lam and the holders of the
convertible notes acquired these securities, all were fully informed and advised
about matters concerning L.A.M., including its business, financial affairs and
other matters. The shareholders of LAM and the holders of the convertible note
acquired the securities for their own account. The certificates evidencing the
securities purchased by the shareholders of LAM bear a legend stating that they
may not be offered, sold or transferred other than pursuant to an effective
registration statement under the Securities Act of 1933, or pursuant to an
applicable exemption from registration. The shares purchased by the shareholders
of LAM and the holders of the convertible note are "restricted" securities as
defined in Rule 144 of the Securities and Exchange Commission. Although no
underwriters were involved with the sale of these securities, L.A.M. paid sales
commissions of $74,600 to an unrelated third party in connection with the sale
of its convertible notes.

The issuance of the shares referenced in Notes D and J were exempt pursuant
to Section 3(a) of the Securities Act of 1933.

Common Stock

Item 27. Exhibits

The following Exhibits are filed with this Registration Statement:

Exhibit
Number Exhibit Name Page Number

Exhibit 2 Plan of Acquisition, Reorganization,
Arrangement,Liquidation, etc. None

Exhibit 3 Articles of Incorporation and Bylaws (1)

Exhibit 4 Instruments Defining the Rights of Security
Holders

Exhibit 4.1 Incentive Stock Option Plan (2)

Exhibit 4.2 Non-Qualified Stock Option Plan (2)

Exhibit 4.3 Stock Bonus Plan (2)

Exhibit 5 Opinion of Counsel

Exhibit 9 Voting Trust AgreementNone

Exhibit 10 Material Contracts

Exhibit 10.1 Agreements with Ixora Bio-Medical Co. (1)

Exhibit 10.2 Common Stock Purchase Agreement with
Hockbury Limited (3)

Exhibit 10.3 Stock Purchase Warrant issued to Hockbury
Limited (3)

Exhibit 10.4 Stock Purchase Warrant issued to GKN Securities
Corp.and certain employees of GKN Securities Corp. (3)

Exhibit 16. Letter from former Accountants (1)

Exhibit 23.1 Consent of Attorneys

Exhibit 23.2 Consent of Accountants

Exhibit 24. Power of Attorney Included as part of signature page

(1) Incorporated by reference to the same exhibit filed with L.A.M.'s
registration statement on Form 10-SB. (2) Incorporated by reference to the
same exhibit filed with L.A.M.'s registration statement on Form S- 8. (3)
Incorporated by reference to the same exhibit filed with L.A.M.'s
registration statement on Form SB-2 (Commission File # 333-56390).

Item 28. Undertakings

The undersigned Registrant hereby undertakes:

(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this Registration Statement.

(i) To include any Prospectus required by Section l0 (a)(3) of the
Securities Act of l933;

(ii) To reflect in the Prospectus any facts or events arising after the
effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the Registration Statement;

(iii)To include any material information with respect to the plan of
distribution not previously disclosed in the Registration Statement or
any material change to such information in the Registration Statement,
including (but not limited to) any addition or deletion of a managing
underwriter.

(2) That, for the purpose of determining any liability under the
Securities Act of l933, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.

(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.

(4) To provide to the Underwriter at the closing specified in the
underwriting agreement certificates in such denominations and registered in such
names as required by the Underwriter to permit prompt delivery to each
purchaser.

(5) Insofar as indemnification for liabilities arising under the Securities
Act of l933 may be permitted to directors, officers and controlling persons of
the Registrant, the Registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public policy
as expressed in the Act and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than the payment by
the Registrant of expenses incurred or paid by a director, officer or
controlling person of the Registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person
in connection with the securities being registered, the Registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question of whether
such indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.

POWER OF ATTORNEY

The registrant and each person whose signature appears below hereby
authorizes the agent for service named in this Registration Statement, with full
power to act alone, to file one or more amendments (including post-effective
amendments) to this Registration Statement, which amendments may make such
changes in this Registration Statement as such agent for service deems
appropriate, and the Registrant and each such person hereby appoints such agent
for service as attorney-in-fact, with full power to act alone, to execute in the
name and in behalf of the Registrant and any such person, individually and in
each capacity stated below, any such amendments to this Registration Statement.

SIGNATURES

Pursuant to the requirements of the Securities Act of l933, the
Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in Toronto, Canada, on the
31st day of August, 2001.

L.A.M. PHARMACEUTICALS, CORP.

By: /s/ Joseph T. Slechta
--------------------------------------
Joseph T. Slechta
President, Chief Operating Officer, and
Principal Financial Officer

Pursuant to the requirements of the Securities Act of l933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.

Signature Title Date

/s/ Joseph T. Slechta
- ------------------------
Joseph T. Slechta Director August 31, 2001

/s/ Alan Drizen
- ------------------------
Alan Drizen Director August 31, 2001

/s/ Peter Rothbart
- -----------------------
Peter Rothbart Director August 31, 2001

/s/ Gary M. Nath
- -------------------------------
Gary M. Nath Director August 31, 2001

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM SB-2
EXHIBITS

L.AM. PHARMACEUTICAL, CORP.
800 Sheppard Avenue West
Commercial Unit 1
Toronto, Ontario
Canada M3H 6B4