UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1997
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from _______________to_________________.
Commission file number: 2-35700
Wasatch Pharmaceutical, Inc.
----------------------------
(Exact name of registrant as specified in charter)
Utah 84-0854009
---- -----------
State or other jurisdiction of (I.R.S. Employer I.D. No.)
incorporation or organization
714 East 7200 South, Midvale, Utah 84047
- ---------------------------------- --------------
(Address of principal executive offices) (Zip Code)
(801) 566-9688
--------------
Issuer's telephone number, including area code
Not Applicable
---------------
(Former name, former address, and former fiscal year, if changed since last
report)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports). Yes [X] No [ ] and (2) has been
subject to such filing requirements for the past 90 days. Yes [X] No [ ]
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the last practicable date.
Class A Common Stock, $.001- 9,167,956 Outstanding as of June 30, 1997
<PAGE>
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
The Registrant's unaudited financial statements have been prepared in
accordance with the instructions to Form 10-QSB pursuant to the rules and
regulations of the Securities and Exchange Commission and, therefore, do not
include all information and footnotes necessary for a complete presentation of
the financial position, results of operations, cash flows, and stockholder's
equity in conformity with generally accepted accounting principles. In the
opinion of management, all adjustments considered necessary for a fair
presentation of the results of operations and financial position have been
included and all such adjustments are of a normal recurring nature.
The unaudited balance sheet of the Registrant as of June 30, 1997, and the
related audited balance sheet of the Registrant as of December 31, 1996, the
unaudited related statements of operations and cash flows for the three month
and six month periods ended June 30, 1997 and 1996 and from inception (September
7, 1989) through June 30, 1997, are attached hereto and incorporated herein by
this reference.
Operating results for the quarter and six months ended June 30, 1997 are
not necessarily indicative of the results that can be expected for the year
ending December 31, 1997.
<PAGE>
<TABLE>
<CAPTION>
WASATCH PHARMACEUTICAL, INC.
(A Development Stage Company)
Consolidated Balance Sheets
JUNE 30, DECEMBER 31,
1997 1996
--------------- -------------
(Unaudited)
CURRENT ASSETS
<S> <C> <C>
Cash $ 3,369 $ 11,991
Accounts receivable - trade 4,513 2,925
Notes receivable - officers 28,733 6,600
Product and supplies inventories 12,943 8,586
--------------- --------------
Total Current Assets 49,559 30,102
--------------- --------------
PROPERTY AND EQUIPMENT
Oil and gas properties,
successful efforts method 3,790,478 3,719,536
Furniture and office equipment 41,599 39,749
--------------- --------------
3,832,076 3,759,285
Less accumulated depreciation (21,141) (15,668)
--------------- --------------
Net Property and Equipment 3,810,936 3,743,617
--------------- --------------
OTHER ASSETS 29,177 l,350
--------------- --------------
TOTAL ASSETS $ 3,889,671 $ 3,775,069
=============== ==============
</TABLE>
The accompanying footnotes are an integral part of these financial statements
<PAGE>
<TABLE>
<CAPTION>
WASATCH PHARMACEUTICAL, INC.
(A Development Stage Company)
Consolidated Balance Sheets
JUNE 30, DECEMBER 31,
1997 1996
--------------- --------------
(Unaudited)
CURRENT LIABILITIES
<S> <C> <C>
Accounts payable - trade $ 192,478 $ 168,159
Accrued interest 198,085 161,226
Other accrued expenses 76,585 44,108
Current portion of notes payable
Vendors 112,333 117,333
Stockholders 849,388 794,388
--------------- ------------
Total Current Liabilities 1,428,869 1,285,214
LONG-TERM DEBT
Notes payable (less current portion) 5,000 5,000
--------------- ------------
Total Liabilities 1,433,869 1,290,214
--------------- ------------
STOCKHOLDERS' EQUITY
Preferred stock, $0.001 par value, 1,000,000
shares authorized with 49,258 issued
and outstanding 49 49
Common stock, $0.001 par value, 50,000,000
shares authorized with 9,167,956 shares
and 6,635,956 shares issued 9,168 6,636
Additional paid-in capital 5,098,462 4,362,549
Accumulated development stage deficit (1,881,877) (1,584,379)
--------------- ------------
3,225,802 2,784,855
Less amounts subscribed but unpaid of
2,420,000 shares and 300,000 shares (770,000) (300,000)
--------------- ------------
Total Stockholder's Equity 2,455,802 2,484,855
--------------- ------------
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $ 3,889,671 $ 3,775,069
=============== ============
</TABLE>
The accompanying footnotes are an integral part of these financial statements
<PAGE>
<TABLE>
<CAPTION>
WASATCH PHARMACEUTICAL, INC.
(A Development Stage Company)
Consolidated Statement of Operations
(Unaudited)
FOR THE FOR THE INCEPTION
SIX MONTHS ENDED THREE MONTHS ENDED THROUGH
JUNE 30, JUNE 30, JUNE 30,
1997 1996 1997 1996 1997
------------ ----------- --------- --------- -----------
REVENUES
<S> <C> <C> <C> <C> <C>
Professional fee income $ 16,738 $ 16,604 $ 9,490 $ 8,396 $ 162,604
Product sales 31,247 46,406 16,248 21,115 337,325
Oil and gas sales 3,456 - 1,961 - 6,477
----------- ---------- --------- --------- ----------
TOTAL REVENUES 51,440 63,010 27,698 29,511 506,405
----------- ---------- --------- --------- ----------
OPERATING EXPENSES
Cost of products sold 2,667 3,640 1,648 1,833 39,961
Salaries 59,140 56,215 40,637 21,320 242,219
Employee leasing - - - 218,745
Payroll taxes 6,035 6,408 3,660 2,604 25,972
Physicians fees 21,000 33,830 10,800 19,430 175,468
Rent 16,264 22,270 8,229 12,301 117,562
Advertising 1,944 6,302 - 4,250 208,246
Depreciation 3,385 3,577 1,698 1,799 20,585
Other 2,140 4,398 (275) - 2,140
----------- ---------- ---------- --------- ----------
Total Operating Expenses 112,575 136,640 66,398 63,537 1,050,898
GENERAL & ADMINSTRATIVE EXPENSE 183,548 144,321 100,991 74,261 1,044,179
OIL AND GAS EXPENSES 11,963 - 5,818 - 23,800
----------- ---------- ---------- --------- ----------
TOTAL EXPENSES 308,087 280,961 173,207 137,798 2,118,878
----------- ----------- ---------- ---------- -----------
INCOME (LOSS) BEFORE OTHER
INCOME (EXPENSE) AND THE
PROVISION FOR INCOME TAXES (256,647) (217,951) (145,509) (108,287) (1,612,473)
----------- ---------- ---------- ---------- -----------
OTHER INCOME (EXPENSES)
Interest expense (47,004) (36,121) (25,183) (18,977) (225,030)
Other - Net 6,153 (1,541) (305) 241 (44,374)
----------- ---------- ---------- ---------- -----------
Total Other Expenses (40,851) (37,662) (488) (18,736) (269,404)
----------- ---------- ---------- ---------- -----------
NET INCOME (LOSS) BEFORE
PROVISION FOR INCOME TAXES (297,498) (255,613) (170,997) (127,023) (1,881,877)
Provision for Income Taxes
NET INCOME (LOSS) $ (297,498) $ (255,613) $ (170,997) $ (127,023) $(1,881,877)
=========== ========== ========== ========== ===========
NET INCOME (LOSS) PER SHARE
OF COMMON STOCK $ (0.046) $ (0.084) $ (0.026) $ (0.042) $ (0.635)
=========== ========== ========== ========== ===========
WEIGHTED AVERAGE
SHARES OUTSTANDING 6,496,829 3,028,962 6,655,934 3,035,519 2,964,559
=========== ========== ========== ========== ===========
</TABLE>
The accompanying footnotes are an integral part of these financial statements
<PAGE>
<TABLE>
<CAPTION>
WASATCH PHARMACEUTICAL, INC.
(A Development Stage Company)
Consolidated Statement of Changes in Shareholders' Equity
(Unaudited)
TOTAL
PREFERRED ADDITIONAL ACCUMULATED STOCK-
STOCK COMMON STOCK PAID-IN DEVELOPMENT HOLDERS
AMOUNT SHARES AMOUNT CAPITAL STAGE DEFICIT EQUITY
---------- ------------ --------- ------------ ------------- ----------
<S> <C> <C> <C> <C> <C> <C>
Balance December 31, 1996 $2,463 6,635,956 $6,636 $ 4,360,135 $(1,584,379) $2,784,855
Retroactive adjustment to the merged
Preferred Stock Amount (2,414) - - 2,414 -
--------- ---------- ------ ----------- ----------- ----------
Stockholders equity-per committed contracts 49 6,635,956 6,636 4,362,549 (1,584,379) 2,784,855
Stock subscription notes outstanding - (300,000) (300) 299,700) (300,000)
-------- ---------- ------ ----------- ----------- ----------
Net equity December 31, 1996 - Restated $ 49 6,335,956 $6,336 $4,062,849 $(1,584,379) $2,484,855
======== ========== ====== =========== =========== ==========
Stockholders equity-per committed contracts
Balance December 31, 1996 $ 49 $6,635,956 $6,636 $4,362,549 $(1,584,379) $2,784,855
Cash proceeds from the exercise
of stock options - 125,000 125 124,875 - 125,000
Stock issued in connection with:
Past services of officers and directors - 2,200,000 2,200 547,800 - 550,000
Acquisition of West Virgina oil &
gas properties - 151,000 151 37,599 - 37,750
Services rendered in connection with
raising development stage funds - 106,000 106 26,394 - 26,500
Shares returned with cancelled contract - (50,000) (50) (50)
Cost of funds raised (755) (755)
Net loss for the six months ended
June 30, 1997 (297,498) (297,498)
-------- ------------ --------- ----------- ----------- ----------
Stockholders equity-per committed contracts 49 9,167,956 9,168 5,098,462 (1,881,877) 3,225,802
Stock subscription notes outstanding - (2,420,000) (2,420) (767,580) - (770,000)
------- ------------ -------- ----------- ---------- -----------
Balance June 30, 1997 $ 49 6,747,956 $6,748 $4,330,882 (1,881,877) $2,455,802
======= ============ ======= =========== =========== ==========
</TABLE>
The accompanying footnotes are an integral part of these financial statements
<PAGE>
<TABLE>
<CAPTION>
WASATCH PHARMACEUTICAL, INC.
(A Development Stage Company)
Consolidated Statement of Cash Flows
(Unaudited)
FROM
FOR THE FOR THE INCEPTION
SIX MONTHS ENDED THREE MONTHS ENDED THROUGH
JUNE 30, JUNE 30, JUNE 30,
1997 1996 1997 1996 1997
----------- ------------ --------- --------- ------------
CASH FLOWS FROM OPERATING
ACTIVITIES
<S> <C> <C> <C> <C> <C>
Net Income (Loss) $ (297,498) $ (255,613) $ (170,997) $ (127,023) $(1,881,877)
Adjustments to Reconcile Net Income
(Loss) to Net Cash Provided (Used)
by Operating Activities
Depreciation and amortization 5,473 3,576 2,882 1,799 21,141
Depreciation on retired assets - 2,698
Expenses paid by shareholder - 756 0 46,737
(Increase) decrease in receivables (1,588) 4,850 (2,517) (4,192) (4,513)
(Increase) decrease in related party receivable (22,133) - (22,133) - (28,733)
(Increase) decrease in product and -
supplies inventories (3,982) (2,647) 1,555 1,833 (12,568)
(Increase) decrease In deposits - 135 - 135 -
Increase (decrease) in accounts payable 24,319 14,345 3,052 (9,229) 192,478
Increase (decrease) in accrued Interest 36,859 34,976 15,182 17,832 198,085
Increase (decrease) In other accruals 32,477 - - - 76,585
Loss on asset disposal - - - - 3,513
---------- ---------- --------- --------- ----------
Net Cash Provided (Used) by
Operating Activities (226,072) (199,622) (172,976) (118,845) (1,386,453)
---------- --------- --------- --------- ----------
CASH FLOWS FROM INVESTING
ACTIVITIES
Purchase of fixed assets (35,041) (755) (9,945) (755) (61,001)
(Increase) decrease in other assets (7,202) 0 245 0 (7,802)
---------- --------- --------- --------- --------
Net Cash Provided (Used) by
Investing Activities (42,243) (755) (9,700) (755) (68,803)
---------- --------- --------- --------- ---------
CASH FLOWS FROM FINANCING
ACTIVITIES
Proceeds from loans 55,000 82,100 2,100 1,089,452
Repayment of loans (5,000) - - - (130,947)
Expenses paid with common shares 5,450 - 5,450 - 11,416
Proceeds from sale of common shares - 117,500 - 117,500 137,500
Capital contributed by shareholder - - - - 154,800
Collection of share subscriptions 80,000 - 50,000 - 80,000
Common shares exchanged for debt - - - - 12,319
Exercised stock options 125,000 - 125,000 - 125,250
Redemption of common shares - - - - (20,409)
Costs of raising funds (755) - 2,762 - (755)
------------ ---------- --------- --------- ---------
Net Cash Provided (Used) by
Investing Activities 259,694 199,600 183,212 119,600 1,458,625
------------ --------- --------- --------- ---------
NET INCREASE (DECREASE) IN
CASH AND CASH EQUIVALENTS (8,622) (777) 2,166 - 3,369
CASH AND CASH EQUIVALENTS
AT BEGINNING OF PERIOD 11,991 777 1,203 - -
------------ --------- ---------- --------- ----------
CASH AND CASH EQUIVALENTS
AT END OF PERIOD $ 3,369 $ - $ 3,369 $ - $ 3,369
============ ========= ========== ========= ==========
</TABLE>
The accompanying footnotes are an integral part of these financial statements
<PAGE>
WASATCH PHARMACEUTICAL, INC.
(A Development Stage Registrant)
Notes to the Consolidated Financial Statements
June 30, 1997 and December 31, 1996
NOTE 1 - NATURE AND HISTORY OF THE BUSINESS
These consolidated financial statements are those of Wasatch
Pharmaceutical, Inc. (A Development Stage Registrant) (the Registrant or
Company), and its wholly owned subsidiaries, Medisys Research Group, Inc. and
American Institute of Skin Care, Inc. The Registrant was initially engaged in
oil and gas exploration and development and returned to that line of business
with an investment in oil and gas properties in November 1996. The Registrant's
primary business segment is described below. In December 1995, the Registrant
(formerly Ceron Resources Corporation; a dormant Delaware Corporation) merged
with Medisys Research Group, Inc. and its wholly owned subsidiary American
Institute of Skin Care, Inc. In January 1996 the Registrant was reincorporated
in Utah.
On December 29, 1995 Wasatch Pharmaceutical, Inc. (Wasatch) and Medisys
Research Group, Inc. (Medisys) completed an Agreement and Plan of Reorganization
whereby Wasatch issued 10,312,216 shares (on a 1 share for 1 share basis) of its
common stock in exchange for all of the issued and outstanding common stock of
Medisys. Pursuant to the reorganization, the name of the Registrant was changed
to Wasatch Pharmaceutical, Inc. The acquisition was accounted for as a purchase
by Medisys of Wasatch, because the shareholders of Medisys control the
Registrant after the acquisition and, therefore, Medisys is treated as the
acquiring entity. Wasatch is the acquiring entity for legal purposes and Medisys
is the surviving entity for accounting purposes.
Medisys Research Group, Inc. (Medisys), was incorporated on September
7, 1989 (the inception of the Registrant's development stage) as a Utah
Corporation for the purpose of developing treatment programs for various skin
disorders. American Institute of Skin Care, Inc. (AISC), was incorporated on
January 21, 1994 as a Utah corporation to administer the skin treatment programs
developed by Medisys.
NOTE 2 - SUPPLEMENTAL CASH FLOW INFORMATION
<TABLE>
<CAPTION>
SIX MONTHS THREE MONTHS ENDED JUNE INCEPTION
ENDED JUNE 30, 30, TO JUNE 30,
1997 1996 1997 1996 1997
----------- ------------ ------------- ------------ ----------------
Supplemental disclosure of cash flow
<S> <C> <C> <C> <C> <C>
Cash paid for interest $10,144 $ 10,000 $ 21,748
Cash paid for taxes
Supplemental schedule for non-cash
investing and financial activities
Common shares issued for assets acquired
Clinical equipment 13,790
Oil and gas properties 37,750 37,750 3,757,286
Deferred offering costs 20,625 20,625 20,625
Prepaid marketing costs 375 375 375
Preferred stock 750
Common share subscriptions and notes 470,000 (80,000) 770,000
Common shares issued for services 4,850 4,850 4,850
----------- ------------ ------------- ------------ ----------------
$543,744 -0- $ 6,400 -0- $ 4,589,424
=========== ============ ============= ============ ================
</TABLE>
<PAGE>
WASATCH PHARMACEUTICAL, INC.
(A Development Stage Registrant)
Notes to the Consolidated Financial Statements
June 30, 1997 and December 31, 1996
NOTE 3 - COMMON STOCK
During the second quarter the following common share and common share
option transactions occurred (See the 10Q for the quarter ended March 31, 1997
for transactions occurring during that period):
a. $125,000 was received by the Registrant upon the exercise of stock
options for 125,000 shares of unrestricted common stock.
b. 200,000 restricted common shares were issued to consultants for
services rendered.
c. 50,000 restricted common shares were canceled concurrent with the
cancellation of a consultant's contract.
d. The Registrant terminated contracts with an insurance company which
resulted in the cancellation of 12,000,000 common shares that had been issued
subject to certain performance criteria. At 12/31/96 year end, these 12,000,000
shares were not included in the outstanding shares because of the many
contingencies on the payment of the issue price.
e. The Registrant issued 57,000 restricted common shares to various
consultants for services rendered.
f. Common share subscription obligations of $50,000 were paid during
the quarter.
NOTE 4 - GENERAL AND ADMINISTRATIVE EXPENSES
General and administrative expenses for the comparative three month
period and from inception through June 30, 1997 are:
<TABLE>
<CAPTION>
SIX MONTHS THREE MONTHS INCEPTION
ENDED JUNE 30, ENDED JUNE 30, TO JUNE 30,
1997 1996 1997 1996 1997
------------- ----------- ------------- ------------ -------------------
<S> <C> <C> <C> <C> <C>
Officer's Compensation $ 81,092 $ 57,130 $ 48,267 $ 22,550 $ 463,676
Legal and accounting 43,267 24,079 27,491 10,879 218,024
Travel 10,070 10,627 5,075 6,013 44,430
Telephone 7,660 4,398 3,399 1,612 40,994
Insurance 357 3,378 195 2,144 10,596
Other 41,103 44,709 16,564 31,063 266,459
============= =========== ============= ============ ===================
$ 183,549 $ 144,321 $ 100,991 $ 74,261 $ 1,044,179
============= =========== ============= ============ ===================
</TABLE>
NOTE 5 - GOING CONCERN
The Registrant's financial statements are prepared using generally
accepted accounting principles applicable to a going concern which contemplates
the realization of assets and liquidation of liabilities in the normal course of
business. However, the Registrant is in the development stage and has not
established a source of revenues sufficient to allow it to continue as a going
concern. The Registrant is negotiating an agreement to raise short-term funding
and plans to seek long-term funding through a stock offering. Management
believes that sufficient funding will be raised to meet the operating needs of
the Registrant during the remainder of development stage.
<PAGE>
WASATCH PHARMACEUTICAL, INC.
(A Development Stage Registrant)
Notes to the Consolidated Financial Statements
June 30, 1997 and December 31, 1996
NOTE 6 - CHANGES IN PRESENTATION
Certain financial presentations for the second quarter and first six
months of 1996 have been reclassified to conform to the 1997 presentation.
THE REST OF THIS PAGE INTENTIONALLY LEFT BLANK
<PAGE>
ITEM 2. MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND RESULTS
OF OPERATIONS
Skin Care Business
The Registrant has proprietary technology for the treatment of various
common skin disorders, including acne, eczema, and psoriasis . After completing
successful clinical studies, prototype clinics were established with the goal of
duplicating the success rates achieved in the clinical environment and to
establish medical, business and administrative procedures that could be
duplicated in a network of Company clinics across the country. Two prototype
treatment clinics are currently in operation in Utah. Although the Registrant
has confirmed the technology through the successful treatment of hundreds of
patients over the last three years and has set up the business and
administrative procedures, the clinics have not reached a profitable level due
to the lack of funds for advertising and marketing.
To this date, the Registrant has not had the resources to fully
implement its plan for the development and expansion of its clinic operation.
Due to the lack of working capital, the Registrant's financial statements
contain a "going concern" disclosure which places into question the Registrant's
ability to continue without substantial increases in revenues or additional
long-term financing.
The Company is seeking funding to open two additional clinics in major
metropolitan areas and to launch a major advertising and marketing campaign to
support each of its clinics. Management feels that through advertising, working
with health insurance companies and HMOs and supplemented by a physician
referral program revenues could be increased substantially thereby improving the
10% to 15% of clinic capacity currently being experienced.
During the first six months of 1997, skin care revenues for the
prototype clinics were down 12% and expenses decreased 9% when compared to the
same locations in the prior year. The remaining revenue and expense decrease is
attributable to the Pocatello, Idaho clinic that was closed in the first quarter
of 1996.
Oil and Gas Operations
In the fourth quarter of 1996, the Registrant acquired a substantial
interest of proven reserves in West Virginia. In order to realize the full
potential for this asset, substantial resources will be required to improve
production and to recomplete previously drilled oil and gas wells. The
Registrant's joint interest operator is in the process of raising the funds to
commence the redevelopment process that is scheduled for the latter part of
1997.
LIQUIDITY AND CAPITAL RESOURCES
At June 30, 1997, the Registrant had a working capital deficit of
$1,379,310, which is approximately what it was at the end of the first quarter
and a 10% increase from the prior year. The Registrant's operating loss for the
six months ending June 30, 1997 was $297,498. The loss was funded through an
extension of credit terms by the Registrant's vendors and noteholders ($45,000),
the sale of stock ($205,000), and additional net borrowing ($50,000).
For the three months ended June 30, 1997, the clinics' operating loss
increased $6,634 to $40,660 when compared to the same quarter last year. From
inception to date, the majority of the expenses have been associated with the
development of the treatment process for the clinics.
During the first six months of 1997, the Registrant expended
approximately $99,000 in completing the oil and gas acquisition and in efforts
to raise additional operating capital.
<PAGE>
RESULTS OF OPERATION
Skin Care Business
During the first six months ending June 30, 1997, the Registrant had
revenues of $51,440 compared to $63,010 during the same six months of 1996.
There are two reasons for this decrease in revenue. During the first three
months of 1996, the Registrant had three prototype clinics generating revenue
from operations. The Registrant closed its clinic in Pocatello, Idaho in
February, 1996. The Registrant's clinic operating expenses decreased by 6% in
the first three months of 1997 as compared to the three months of 1996 due to a
reduction in salaries and other overhead expenses. During the three months ended
June 30, 1997, expenses increased $2,800 after substantial reduction in costs
from the restructured clinic operation which was more than offset by increased
personnel training costs in anticipation of opening additional clinics.
The Registrant anticipates that the losses will continue until funding is
obtained which will be used to launch the marketing program.
Oil and Gas Operations
During the first half of 1997, there was no significant progress in the
redevelopment of the Registrant's West Virginia oil and gas properties. Revenues
and expenses from producing wells were minimal and the loss from operations
totaled approximately $8,500 for the six months ended June 30, 1997. Investment
in the oil and gas property increased $70,942 during the first six month period.
General and Administrative Expenses
Increases in General & Administrative Expenses during the second
quarter were $26,730 when compared to the prior year and are attributable to the
reasons set forth in the discussion below. The increase in general and
administrative expenses during the six months ended June 30, 1997, when compared
to the same period in the prior year, is attributable to the increased legal and
audit costs associated with acquiring the West Virginia oil and gas interest,
approximately $18,000, and increased officer's compensation , approximately
$21,000, that was inordinately low in the prior year. The Registrant's corporate
expenses increased substantially due to increased legal, accounting and
administrative expenses that were associated with raising capital and the
additional cost of being a fully reporting public entity.
ITEM 1. LEGAL PROCEEDINGS
None.
ITEM 2. CHANGES IN SECURITIES
None
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None.
<PAGE>
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITIES HOLDERS
None.
ITEM 5. OTHER INFORMATION
None.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits.
Attached is the financial data schedule required by paragraph
(b)(27) of this item.
(b) Reports on Form 8-K
None
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
WASATCH PHARMACEUTICAL, INC.
[Registrant]
Dated: August 14, 1997
/S/David K. Giles
Principal Accounting Officer
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<CASH> 3,369
<SECURITIES> 0
<RECEIVABLES> 33,246
<ALLOWANCES> 0
<INVENTORY> 12,943
<CURRENT-ASSETS> 49,559
<PP&E> 3,832,076
<DEPRECIATION> 21,141
<TOTAL-ASSETS> 3,889,671
<CURRENT-LIABILITIES> 1,428,869
<BONDS> 0
0
49
<COMMON> 9,168
<OTHER-SE> 2,446,585
<TOTAL-LIABILITY-AND-EQUITY> 3,889,671
<SALES> 16,738
<TOTAL-REVENUES> 51,440
<CGS> 2,667
<TOTAL-COSTS> 308,087
<OTHER-EXPENSES> (6,153)
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 47,004
<INCOME-PRETAX> (297,498)
<INCOME-TAX> 0
<INCOME-CONTINUING> (297,498)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (297,498)
<EPS-PRIMARY> (.046)
<EPS-DILUTED> (.046)
</TABLE>
