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    <B><FONT style="font-size: 9pt">As filed with the Securities and
    Exchange Commission on April&#160;16, 2010</FONT></B>
</DIV>

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    <B><FONT style="font-size: 9pt">Registration
    <FONT style="white-space: nowrap">No.&#160;333-&#160;&#160;&#160;&#160;&#160;&#160;</FONT></FONT></B>
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    <B><FONT style="font-size: 14pt">UNITED STATES SECURITIES AND
    EXCHANGE COMMISSION<BR>
    </FONT><FONT style="font-size: 12pt">Washington,&#160;D.C.
    20549</FONT></B>
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    <B><FONT style="font-size: 17pt"><FONT style="white-space: nowrap">Form&#160;S-1</FONT><BR>
    </FONT><FONT style="font-size: 11pt">REGISTRATION STATEMENT<BR>
    UNDER<BR>
    THE SECURITIES ACT OF 1933</FONT></B>
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    <B><FONT style="font-size: 22pt">REGENERX BIOPHARMACEUTICALS,
    INC.</FONT></B>
</DIV>

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    <I><FONT style="font-size: 7pt">(Exact name of registrant as
    specified in its charter)</FONT></I>
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    <TD width="34%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
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    <B>Delaware</B>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="top">
    <B>2834</B>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="top">
    <B>52-1253406</B>
</TD>
</TR>
<TR valign="bottom">
<TD align="center" valign="top">
    <I><FONT style="font-size: 7pt">(State or other jurisdiction
    of<BR>
    incorporation or organization)</FONT></I>
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="top">
    <I><FONT style="font-size: 7pt">(Primary Standard Industrial<BR>
    Classification Code Number)</FONT></I>
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="top">
    <I><FONT style="font-size: 7pt">(I.R.S. Employer<BR>
    Identification Number)</FONT></I><FONT style="font-size: 7pt">
    </FONT>
</TD>
</TR>
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    <B><FONT style="font-size: 9pt">15245 Shady Grove Road,
    Suite&#160;470<BR>
    Rockville, MD 20850<BR>
    <FONT style="white-space: nowrap">(301)&#160;208-9191</FONT><BR>
    </FONT></B><I><FONT style="font-size: 7pt">(Address, including
    zip code, and telephone number, including area code, of
    registrant&#146;s principal executive offices)</FONT></I>
</DIV>

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    <B><FONT style="font-size: 9pt">J.J. Finkelstein<BR>
    President and Chief Executive Officer<BR>
    15245 Shady Grove Road, Suite&#160;470<BR>
    Rockville, MD 20850<BR>
    <FONT style="white-space: nowrap">(301)&#160;208-9191</FONT><BR>
    </FONT></B><I><FONT style="font-size: 7pt">(Name, address,
    including zip code, and telephone number, including area code,
    of agent for service)</FONT></I>
</DIV>

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    <B><I><FONT style="font-size: 9pt">Copies to:</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

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<TD align="center" valign="top">
    <B>Darren K. DeStefano,&#160;Esq.<BR>
    Brian F. Leaf,&#160;Esq.<BR>
    Cooley Godward Kronish LLP<BR>
    One Freedom Square, Reston Town Center<BR>
    11951 Freedom Drive<BR>
    Reston, VA
    <FONT style="white-space: nowrap">20190-5656</FONT><BR>
    <FONT style="white-space: nowrap">(703)&#160;456-8000</FONT></B>
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="top">
    <B>Steven M. Skolnick,&#160;Esq.<BR>
    Lowenstein Sandler PC<BR>
    65 Livingston Avenue<BR>
    Roseland, NJ 07068-1791<BR>
    (973) 597-2382</B>
</TD>
</TR>
</TABLE>

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<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 3%; font-size: 9pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>Approximate date of commencement of proposed sale to the
    public:</B>&#160;&#160;As soon as practicable after the
    effective date of this registration statement.
</DIV>

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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 3%; font-size: 9pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If any of the securities being registered on this Form are to be
    offered on a delayed or continuous basis pursuant to
    Rule&#160;415 under the Securities Act of 1933, check the
    following
    box.&#160;&#160;<FONT style="font-family: Wingdings; font-variant: normal">&#111;
    </FONT>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 3%; font-size: 9pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If this Form is filed to register additional securities for an
    offering pursuant to Rule&#160;462(b) 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.&#160;&#160;<FONT style="font-family: Wingdings; font-variant: normal">&#111;
    </FONT>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 3%; font-size: 9pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If this Form is a post-effective amendment filed pursuant to
    Rule&#160;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.&#160;&#160;<FONT style="font-family: Wingdings; font-variant: normal">&#111;
    </FONT>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 3%; font-size: 9pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If this Form is a post-effective amendment filed pursuant to
    Rule&#160;462(d) under the Securities Act, check the following
    box and list the Securities Act registration number of the
    earlier effective registration statement for the same
    offering.&#160;&#160;<FONT style="font-family: Wingdings; font-variant: normal">&#111;
    </FONT>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<CENTER style="font-size: 1pt; width: 15%; border-bottom: 1pt solid #000000"></CENTER>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 9pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">CALCULATION
    OF REGISTRATION FEE</FONT></B>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 8pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="60%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutterleft -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutterright -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=03 type=gutterleft -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=03 type=gutterright -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="5%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=04 type=gutterleft -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=04 type=gutterright -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="5%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=05 type=gutterleft -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=05 type=gutterright -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
</TR>
<!-- Table Width Row END -->
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<TR style="font-size: 7pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom" style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-top: 3px double #000000">
    <B>Proposed Maximum<BR>
    </B>
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-top: 3px double #000000">
    <B>Proposed Maximum<BR>
    </B>
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-top: 3px double #000000">
    <B>Amount of<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 7pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
    <B>Title of Each Class of<BR>
    </B>
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Amount to be<BR>
    </B>
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Offering<BR>
    </B>
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Aggregate<BR>
    </B>
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Registration<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 7pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
    <B>Securities Being Registered</B>
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Registered(1)</B>
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Price per Unit(2)</B>
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Offering Price(2)</B>
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Fee</B>
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom">
<TD align="left" valign="bottom" style="border-top: 1px solid #000000">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Units, each consisting
    of&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock, $0.001&#160;par value per share, and a warrant
    to
    purchase&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock
</DIV>
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
    $
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
    $
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
    $
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom" style="border-top: 1px solid #000000">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Common Stock, $0.001&#160;par value per share, included in the
    Units
</DIV>
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
    $
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
    $
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
    $
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
    (3
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
    )
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom" style="border-top: 1px solid #000000">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Warrants included in the Units
</DIV>
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
    $
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
    $
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
    $
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
    (3
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
    )
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom" style="border-top: 1px solid #000000">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Shares of common stock underlying the warrants included in the
    Units
</DIV>
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
    $
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
    $
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
    $
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Underwriters&#146; Warrants
</DIV>
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
    $
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
    $
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
    $
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
    (3
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
    )
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom" style="border-top: 1px solid #000000">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Shares of common stock underlying the Underwriters&#146; Warrants
</DIV>
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
    $
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
    $
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
    $
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
    (3
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
    )
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Total
</DIV>
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
    $
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
    $
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
    12,000,000
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
    $
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
    855.60
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
</TR>
<TR style="font-size: 1pt">
<TD nowrap align="left" valign="bottom" style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 3px double #000000">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="1%"></TD>
    <TD width="1%"></TD>
    <TD width="98%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    <FONT style="font-size: 9pt">(1)
    </FONT></TD>
    <TD></TD>
    <TD valign="bottom">
    <FONT style="font-size: 9pt">Includes&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
    units, consisting
    of&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock and warrants to
    purchase&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock, which may be issued upon exercise of a
    <FONT style="white-space: nowrap">45-day</FONT>
    option granted to the underwriters to cover over-allotments, if
    any.
    </FONT></TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    <FONT style="font-size: 9pt">(2)
    </FONT></TD>
    <TD></TD>
    <TD valign="bottom">
    <FONT style="font-size: 9pt">Estimated solely for purposes of
    computing the amount of the registration fee pursuant to
    Rule&#160;457(o) under the Securities Act.
    </FONT></TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    <FONT style="font-size: 9pt">(3)
    </FONT></TD>
    <TD></TD>
    <TD valign="bottom">
    <FONT style="font-size: 9pt">No fee pursuant to Rule&#160;457(g)
    under the Securities Act.
    </FONT></TD>
</TR>

</TABLE>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<CENTER style="font-size: 1pt; width: 15%; border-bottom: 1pt solid #000000"></CENTER>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 3%; font-size: 9pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Indicate by check mark whether the registrant is a large
    accelerated filer, an accelerated filer, a non-accelerated
    filer, or a smaller reporting company. See the definitions of
    &#147;large accelerated filer,&#148; &#147;accelerated
    filer&#148; and &#147;smaller reporting company&#148; in Rule
    <FONT style="white-space: nowrap">12b-2</FONT> of the
    Exchange Act. (Check one):
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 8pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="18%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="7%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="12%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="7%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="30%">&nbsp;</TD>	<!-- colindex=03 type=maindata -->
    <TD width="7%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="19%">&nbsp;</TD>	<!-- colindex=04 type=maindata -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<!-- TableOutputBody -->
<TR valign="bottom">
<TD nowrap align="center" valign="top">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Large&#160;accelerated&#160;filer&#160;<FONT style="font-family: Wingdings; font-variant: normal">&#111;
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="top">
    Accelerated&#160;filer&#160;<FONT style="font-family: Wingdings; font-variant: normal">&#111;
    </FONT>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="top">
    <FONT style="white-space: nowrap">Non-accelerated&#160;filer&#160;</FONT><FONT style="font-family: Wingdings; font-variant: normal">&#111;</FONT><BR>
    (Do&#160;not&#160;check&#160;if&#160;a&#160;smaller&#160;reporting&#160;company)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="top">
    Smaller&#160;reporting&#160;company&#160;<FONT style="font-family: Wingdings; font-variant: normal">&#254;</FONT>
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 3%; font-size: 9pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>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 that
    specifically states that this Registration Statement shall
    thereafter become effective in accordance with Section&#160;8(a)
    of the Securities Act of 1933, as amended, or until the
    registration statement shall become effective on such date as
    the Commission, acting pursuant to said Section&#160;8(a), may
    determine.</B>
</DIV>

<DIV style="margin-top: 4pt; font-size: 1pt">&nbsp;</DIV>

<CENTER style="font-size: 1pt; width: 100%; border-bottom: 1pt solid #000000"></CENTER>

<CENTER style="font-size: 1pt; width: 100%; border-bottom: 2pt solid #000000"></CENTER>
<!-- XBRL Pagebreak Begin -->

<P align="left" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 94%; margin-left: 3%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<TABLE style="color: #FF0000" width="100%" border="1" cellpadding="5"><TR><TD style=text-align:justify>
<FONT style="font-size: 8pt; font-family: Arial, Helvetica; color: #E8112D">The
information in this prospectus is not complete and may be
changed. We may not sell these securities until the registration
statement filed with the Securities and Exchange Commission is
effective. This prospectus is not an offer to sell these
securities and we are not soliciting offers to buy these
securities in any state where the offer or sale is not
permitted.<BR>
</FONT>
</TD></TR></TABLE>

<DIV style="margin-top: 1pt; font-size: 1pt">&nbsp;</DIV>
</DIV><!-- END PAGE WIDTH -->
<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><FONT style="color: #E8112D">SUBJECT TO COMPLETION, DATED
    APRIL&#160;16, 2010</FONT></B>
</DIV>

<DIV style="margin-top: 11pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>PROSPECTUS</B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 14pt">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Units</FONT></B>
</DIV>

<DIV style="margin-top: 8pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <IMG src="w78085w7808500.gif" alt="(REGENERX LOGO)"><FONT style="font-size: 14pt">
    </FONT>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 14pt">Common Stock</FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 14pt">Warrants</FONT></B>
</DIV>

<DIV style="margin-top: 9pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 8pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We are
    offering&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
    units, each unit consisting
    of&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of our common stock and a warrant to
    purchase&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock. The units will separate immediately and the
    common stock and warrants will be issued separately. There will
    be no market for the units. Each unit will be sold at a purchase
    price of $&#160;&#160;&#160;&#160;&#160;.
</DIV>

<DIV style="margin-top: 8pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our common stock is currently listed on the NYSE Amex stock
    exchange under the symbol &#147;RGN.&#148; On April&#160;15,
    2010, the last reported sale price of our common stock on the
    NYSE Amex was $0.57 per share. Currently, no public market
    exists for the warrants offered by this prospectus. We intend to
    apply for listing of the warrants on the NYSE Amex under the
    symbol
    &#147;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;.&#148;
    The warrants will begin trading on or promptly after the date of
    this prospectus, subject to listing on NYSE Amex.
</DIV>

<DIV style="margin-top: 8pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Investing
    in our securities involves a high degree of risk. See &#147;Risk
    Factors&#148;<BR>
    beginning on page&#160;7 of this prospectus for a discussion of
    information that should be<BR>
    considered in connection with an investment in our
    securities.</FONT></B>
</DIV>

<DIV style="margin-top: 8pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="77%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="4%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="4%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Per Unit</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Total</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Public offering price
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Underwriting discounts and commissions(1)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Proceeds, before expenses, to us
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">

</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 2pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    Does not include a corporate finance fee in the amount of 1% of
    the gross proceeds of the offering or warrants to be issued to
    the representative of the underwriters. See
    &#147;Underwriting&#148; beginning on page&#160;&#160;&#160; of
    this prospectus.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have granted the underwriters a
    <FONT style="white-space: nowrap">45-day</FONT>
    option to purchase up to an
    additional&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;units
    from us on the same terms and conditions as set forth above.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>Neither the Securities and Exchange Commission nor any state
    securities regulators have approved or disapproved of these
    securities or determined if this prospectus is truthful or
    complete. Any representation to the contrary is a criminal
    offense.</B>
</DIV>

<DIV style="margin-top: 9pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The underwriters expect to deliver the units to purchasers on or
    about&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;,
    2010.
</DIV>

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="50%"></TD>
    <TD width="50%"></TD>
</TR>

<TR valign="top">
    <TD nowrap align="left">    <B><FONT style="font-size: 18pt; font-family: 'Times New Roman', Times">Maxim
    Group LLC<BR>
    </FONT></B></TD>
    <TD nowrap align="right">    <B><FONT style="font-size: 18pt; font-family: 'Times New Roman', Times">
    Boenning&#160;&#038; Scattergood, Inc.</FONT></B></TD>
</TR>

</TABLE>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The date of this prospectus
    is&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;,
    2010.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="left" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">TABLE OF
    CONTENTS</FONT></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>
<DIV align="left">
<!-- TOC -->
</DIV>

<DIV align="left">
<A name="tocpage"></A>
</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="97%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=quadleft -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=quadright -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Page</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#101'>Prospectus Summary</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#102'>Risk Factors</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#103'>Special Note Regarding Forward-Looking
    Statements</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    22
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#104'>Use of Proceeds</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    24
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#105'>Capitalization</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    25
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#106'>Price Range of Common Stock and Dividend
    Policy</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    26
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#107'>Dilution</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    26
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#108'>Selected Financial Data</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    28
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#109'>Management&#146;s Discussion and Analysis of
    Financial Condition and Results of Operations</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    29
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#110'>Business</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    37
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#111'>Management</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    47
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#112'>Executive Compensation</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    53
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#113'>Certain Relationships and Related Party
    Transactions</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    60
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#114'>Principal Stockholders</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    62
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#115'>Description of Securities</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    64
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#116'>Underwriting</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    69
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#117'>Legal Matters</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    75
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#118'>Experts</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    75
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#119'>Where You Can Find Additional Information</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    75
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#120'>Disclosure of Commission Position on
    Indemnification for Securities Act Liability</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    76
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#121'>Index to Financial Statements</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    F-1
</TD>
<TD>&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV align="left">
<!-- /TOC -->
</DIV>

<DIV style="margin-top: 24pt; font-size: 1pt">&nbsp;</DIV>

<CENTER style="font-size: 1pt; width: 18%; border-bottom: 1pt solid #000000"></CENTER>

<DIV style="margin-top: 24pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    You should rely only on the information contained in this
    prospectus and any related free writing prospectus we may
    authorize to be delivered to you. We have not, and the
    underwriters have not, authorized any person to provide you with
    different information. If anyone provides you with different or
    inconsistent information, you should not rely on it. Neither
    this prospectus nor any related free writing prospectus is an
    offer to sell, nor are they seeking an offer to buy, these
    securities in any state where the offer or solicitation is not
    permitted. The information contained in this prospectus is
    complete and accurate as of the date on the front cover of this
    prospectus, but information may have changed since that date.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    This prospectus includes statistical and other industry and
    market data that we obtained from industry publications and
    research, surveys and studies conducted by third parties.
    Industry publications and third-party research, surveys and
    studies generally indicate that their information has been
    obtained from sources believed to be reliable, although they do
    not guarantee the accuracy or completeness of such information.
    While we believe that these industry publications and
    third-party research, surveys and studies are reliable, we have
    not independently verified such data and we do not make any
    representation as to the accuracy of the information.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="left" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->
<DIV style="width: 100%; height: 9in; border-top: 1px solid #000000; padding-top: 12pt; border-right: 1px solid #000000; padding-right: 12pt; border-bottom: 1px solid #000000; padding-bottom: 12pt; border-left: 1px solid #000000; padding-left: 12pt"><!-- Begin box 1 -->

<A name='101'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">PROSPECTUS
    SUMMARY</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>The items in the following summary are described in more
    detail later in this prospectus. This summary does not contain
    all of the information you should consider. Before investing in
    our securities, you should read the entire prospectus carefully,
    including the &#147;Risk Factors&#148; beginning on page&#160;7
    and the financial statements and related notes beginning on
    <FONT style="white-space: nowrap">page&#160;F-1.</FONT>
    Unless the context indicates otherwise, (i) as used in this
    prospectus, the terms &#147;RegeneRx,&#148; &#147;our
    company,&#148; &#147;we,&#148; &#147;us&#148; and
    &#147;our&#148; refer to RegeneRx Biopharmaceuticals, Inc. and
    (ii) the information in this prospectus assumes no exercise of
    the underwriters&#146; over-allotment option.</I>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Overview</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We are a biopharmaceutical company focused on the development of
    a novel therapeutic peptide, Thymosin beta 4, or T&#223;4, for
    tissue and organ protection, repair, and regeneration. We have
    formulated T&#223;4 into three distinct product candidates
    currently in clinical development:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    RGN-352, an injectable product candidate to treat cardiovascular
    diseases, central nervous system diseases, and other medical
    indications that may be treated by systemic administration, for
    which we intend to initiate a Phase 2 clinical trial in the
    second half of 2010;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    RGN-259, a topical eye drop for ophthalmic indications that was
    evaluated in a small Phase&#160;2 clinical trial and is
    currently being supported in compassionate use studies;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    RGN-137, a topically applied gel for chronic dermal wounds and
    reduction of scar tissue that is currently in a Phase 2 clinical
    trial for the treatment of the skin defect epidermolysis
    bullosa, or EB.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have a fourth product candidate, RGN-457, in preclinical
    development. RGN-457 is an inhaled formulation of T&#223;4
    targeting cystic fibrosis and other pulmonary diseases.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In addition to our four pharmaceutical product candidates, we
    are also pursuing the commercial development of peptide
    fragments and derivatives of T&#223;4 for cosmeceutical use.
    Cosmeceuticals are cosmetic products with biologically active
    ingredients. We believe the biological activities of these
    fragments may be useful, for example, in developing novel
    cosmeceutical products for the anti-aging market.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following chart provides an overview of our product
    candidates and their development status:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <IMG src="w78085w7808501.gif" alt="(PRODUCT CANDIDATE CHART)">
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We are engaged in research collaborations with at least 25
    research institutions throughout the world, which we believe
    indicates significant independent research interest in the
    clinical potential of T&#223;4. Most of these
</DIV>
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    <BR>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    institutions, including the U.S.&#160;military, are conducting
    research on T&#223;4 at their own expense. We have also entered
    into a license agreement with the U.S.&#160;National Institutes
    of Health, or NIH, under which we received an exclusive
    worldwide license for T&#223;4 for several clinical indications.
    We have similarly in-licensed other rights related to T&#223;4
    that we believe support our current or expected future clinical
    development. We have applied for or hold over 60 worldwide
    patents on peptide compositions, uses and formulations related
    to cardiac, central nervous system, ophthalmic and dermal
    indications, among others, as well as for cosmetic and consumer
    products.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Our
    T&#223;4-Based Product Candidates</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    T&#223;4 is a naturally occurring
    <FONT style="white-space: nowrap">43-amino</FONT>
    acid peptide that was originally isolated from bovine thymus
    glands. Preclinical animal research has identified several
    important biological activities of T&#223;4 that we believe make
    it potentially useful as a wound healing, repair and tissue
    regenerating agent, including:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    signaling adult epicardial progenitor cells, or EPCs, to
    differentiate into coronary blood vessels;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    forming cardiomyocytes that repair damaged heart tissue;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    triggering the maturation of stem cells into cells that produce
    myelin, the outer covering of nerve cells in the central nervous
    system;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    improving neurologic functional recovery;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    regulating actin, which is critical to cell structure and
    mobility;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    stimulating angiogenesis, or blood vessel development;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    reducing inflammation, which is implicated in many medical
    indications;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    stimulating the formation of collagen and up-regulation of
    laminin-5 to accelerate tissue repair;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    preventing apoptosis, or programmed cell death.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have developed a synthetic version of T&#223;4 and have
    formulated it for various routes of administration, targeting
    medical indications with significant unmet needs and market
    potential, as well as orphan indications that we believe could
    also provide substantial commercial value. Our product
    candidates are intended to provide solutions to these medical
    indications and to offer improvements to current standards of
    care.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">RGN-352</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our product candidate RGN-352 is an injectable formulation of
    T&#223;4 for systemic administration. We have initially targeted
    RGN-352 for patients who have suffered an acute myocardial
    infarction, or AMI, commonly known as a heart attack.
    Preclinical research published in the scientific journal
    <I>Nature </I>has indicated that T&#223;4 can guide specific
    types of stem cells from the outer layer of the heart to
    generate new myocardial blood vessels and tissue at injured
    sites. During 2009, we completed a Phase 1 clinical trial
    evaluating the safety of RGN-352 in 60 healthy subjects. The
    product candidate was well-tolerated, and there were no reported
    drug-related adverse events.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Based on the results of this Phase 1 trial, and subject to
    available funding, we intend to initiate a Phase 2 clinical
    trial in the second half of 2010 to evaluate RGN-352&#146;s
    ability to salvage and regenerate damaged cardiac tissue and
    improve cardiac function after a heart attack. We intend to use
    a portion of the proceeds of this offering to initiate and
    conduct this Phase 2 clinical trial, although depending on the
    amount of proceeds we may not be able to complete the trial
    without additional capital. Depending on our capital resources,
    we may conduct the trial while also continuing strategic
    partnership discussions with biotechnology and pharmaceutical
    companies for the further development of RGN-352.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Recent preclinical research published in the scientific journal
    <I>Neuroscience </I>also indicates that RGN-352 may prove useful
    for patients with multiple sclerosis, or MS, and stroke. In
    research involving mice, the administration of T&#223;4 resulted
    in statistically significant improvement in neurological
    functional recovery. Based on this research, we intend to
    support a proposed Phase 1/2 clinical trial to be conducted at a
    major U.S.&#160;medical center under a physician-sponsored
    investigational new drug application, or IND, in order to
</DIV>
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    <BR>
    2
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<DIV style="width: 100%; height: 9in; border-top: 1px solid #000000; padding-top: 12pt; border-right: 1px solid #000000; padding-right: 12pt; border-bottom: 1px solid #000000; padding-bottom: 12pt; border-left: 1px solid #000000; padding-left: 12pt"><!-- Begin box 1 -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    evaluate the therapeutic potential of RGN-352 in patients with
    MS. We are planning to supply RGN-352 and provide clinical and
    regulatory guidance for the trial. We believe that we can
    support this trial from our existing capital resources, although
    we intend to use a portion of the proceeds from this offering to
    provide additional support.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">RGN-259</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our product candidate RGN-259 is a sterile topical eye drop
    formulation of T&#223;4 for ophthalmic indications. Emerging
    human clinical data from two compassionate use studies have
    demonstrated the ability of RGN-259 to repair and regenerate
    corneal tissue in patients with non-healing corneal lesions in
    the eye. This data has been reported at medical conferences and
    published in scientific journals and provided the
    <FONT style="white-space: nowrap">proof-of-concept</FONT>
    data that we initially sought for RGN-259. Based on these data
    and slower than expected patient accrual in a Phase 2 ophthalmic
    wound healing trial that we had initiated with RGN-259, in 2009,
    we closed the Phase 2 trial after enrolling the initial low-dose
    cohort. The results from evaluating this initial cohort
    indicated increased corneal epithelial thickening and reduced
    cell and flare inflammation in the T&#223;4-treated patients, as
    compared to patients who were administered placebo. We believe
    these results are indicative of T&#223;4&#146;s activities in
    corneal re-epithelialization and healing.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We are continuing to support the development of RGN-259 in
    ophthalmic indications under compassionate use INDs and expect
    to report final patient data from these trials in the third
    quarter of 2010. We are also planning to support a
    physician-sponsored clinical trial in patients with dry eye
    secondary to graft versus host disease, or GvHD, in order to
    gain further insight into RGN-259&#146;s ability to repair and
    regenerate ophthalmic tissues. Our support includes
    manufacturing and supplying RGN-259 for the trial and providing
    regulatory and clinical guidance. We are continuing to
    collaborate with the U.S. military to evaluate the potential of
    RGN-259 to prevent or reduce eye damage caused by chemical
    warfare agents. We are also engaged in discussions with
    potential partners regarding the clinical development of this
    product candidate. Once enough human data is generated, we
    intend to seek strategic partnerships with one or more
    ophthalmic specialty companies.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">RGN-137</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our product candidate RGN-137 is a topical gel formulation of
    T&#223;4 intended to promote dermal wound healing and tissue
    regeneration. Preclinical research has demonstrated that
    T&#223;4 can accelerate dermal regeneration after a wound, while
    more recent research indicates that T&#223;4 can reduce scarring
    after injury in the skin and heart. In 2005, based on research
    conducted at the NIH, we initiated a series of Phase 2 clinical
    trials to evaluate RGN-137 for the treatment of three different
    types of skin wounds.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The first trial evaluated the use of RGN-137 in the treatment of
    patients with EB, which is a genetic defect that results in
    fragile skin and other epidermal tissues that can blister at the
    slightest trauma or friction, creating a wound that at times
    does not heal or heals poorly. A portion of this trial was
    funded by a grant from the FDA due to the orphan nature of the
    indication. Despite the small patient population with this
    disease, we are continuing to enroll patients in this Phase 2
    trial and expect to complete it in late 2010 or early 2011. Once
    we complete our Phase 2 EB trial, we will analyze the data in
    conjunction with our two other completed Phase 2 trials, along
    with the preclinical data indicating T&#223;4&#146;s ability to
    reduce scarring, at which time we will further evaluate our
    strategy for the clinical development of RGN-137.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Relationship
    with Sigma-Tau</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Sigma-Tau Industrie Farmaceutiche Riunite S.p.A. is an
    international pharmaceutical company and an affiliate of
    Sigma-Tau Finanziaria S.p.A., which together with its affiliates
    comprise our largest stockholder group and are referred to in
    this prospectus as Sigma-Tau. Sigma-Tau has licensed certain
    rights to our product candidates for marketing in Europe and
    other surrounding countries, for which we would be the exclusive
    supplier of T&#223;4 and would receive royalties on commercial
    sales, if any. Sigma-Tau conducted and funded our completed
    Phase 2 trial in Italy and Poland to evaluate RGN-137 for the
    treatment of patients with venous stasis ulcers.
</DIV>
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    <BR>
    3
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<DIV style="width: 100%; height: 9in; border-top: 1px solid #000000; padding-top: 12pt; border-right: 1px solid #000000; padding-right: 12pt; border-bottom: 1px solid #000000; padding-bottom: 12pt; border-left: 1px solid #000000; padding-left: 12pt"><!-- Begin box 1 -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Commercialization
    Strategy</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our strategy is to seek strategic partners and to out-license
    rights for each drug candidate and our peptide fragments, with
    certain exceptions. For example, we believe we can commercially
    develop and market
    <FONT style="white-space: nowrap">RGN-137</FONT> for
    EB, since the patient population is small and well-defined, as
    is the population of pediatric dermatologists who specialize in
    treating this disease. We continue to hold strategic discussions
    with pharmaceutical and biotechnology companies at each
    development milestone for each product candidate.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Corporate
    Information</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We were incorporated in Delaware in 1982 under the name Alpha 1
    Biomedicals, Inc. In 2000, we changed our corporate name to
    RegeneRx Biopharmaceuticals, Inc. at which time we began hiring
    our current management team. Our principal executive office is
    located at 15245 Shady Grove Road, Suite&#160;470, Rockville,
    Maryland 20850. Our telephone number is
    <FONT style="white-space: nowrap">(301)&#160;208-9191.</FONT>
    Our website address is <I>www.regenerx.com. </I>Information
    contained in, or accessible through, our website does not
    constitute a part of, and is not incorporated into, this
    prospectus.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We use
    RegeneRx<SUP style="font-size: 85%; vertical-align: top"><FONT style="font-variant: SMALL-CAPS">tm</FONT></SUP>

    and the RegeneRx logo as trademarks and service marks in the
    United States. All other trademarks or trade names referred to
    in this prospectus are the property of their respective owners.
</DIV>
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<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">The
    Offering</FONT></B>
</DIV>

<DIV style="margin-top: 4pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="36%"></TD>
    <TD width="1%"></TD>
    <TD width="63%"></TD>
</TR>

<TR>
    <TD valign="top">
    Securities offered by us</TD>
    <TD></TD>
    <TD valign="bottom">
    &#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;units,
    each unit consisting
    of&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
    shares of common stock, par value $0.001 per share, and a
    tradeable warrant to
    purchase&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
    shares of common stock (each, a &#147;unit&#148;).</TD>
</TR>


<TR style="line-height: 4pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    Common stock to be outstanding after<BR>
    this offering</TD>
    <TD></TD>
    <TD valign="bottom">
    &#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares </TD>
</TR>


<TR style="line-height: 4pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    Terms of the warrants offered by us</TD>
    <TD></TD>
    <TD valign="bottom">
    Each warrant will be exercisable during the period commencing on
    the date of original issuance and ending five years thereafter
    at an exercise price of $&#160;&#160;&#160;&#160;&#160; per
    share of common stock. See &#147;Description of
    Securities.&#148; This prospectus also relates to the offering
    of the shares of common stock issuable upon exercise of the
    warrants.</TD>
</TR>


<TR style="line-height: 4pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    Redemption of the warrants issued as<BR>
    part of the units</TD>
    <TD></TD>
    <TD valign="bottom">
    In the event the closing sale price of our common stock is at
    least $&#160;&#160;&#160;&#160;&#160; per share for any 20
    trading days within a 30 consecutive trading day period, we may
    call the warrants for redemption, at a redemption price of $0.01
    per warrant, by providing at least 30&#160;days notice to each
    warrant holder. Holders of the warrants will be entitled to
    exercise the warrants prior to the date scheduled for
    redemption, but there can be no assurance that the price of our
    common stock will exceed the call price or the warrant exercise
    price after the redemption call is made.</TD>
</TR>


<TR style="line-height: 4pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    Over-allotment option</TD>
    <TD></TD>
    <TD valign="bottom">
    &#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
    units</TD>
</TR>


<TR style="line-height: 4pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    Use of proceeds</TD>
    <TD></TD>
    <TD valign="bottom">
    We intend to use the net proceeds from this offering, and our
    existing cash and cash equivalents, to fund ongoing research and
    development activities, including contemplated clinical trials,
    and for general corporate purposes, including working capital.
    See &#147;Use of Proceeds.&#148;</TD>
</TR>


<TR style="line-height: 4pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    Market for our securities</TD>
    <TD></TD>
    <TD valign="bottom">
    Our common stock is currently listed on the NYSE Amex under the
    symbol &#147;RGN.&#148; We intend to apply for listing of the
    warrants underlying the units on the NYSE Amex. There will be no
    market for the units.</TD>
</TR>


<TR style="line-height: 4pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    Risk factors</TD>
    <TD></TD>
    <TD valign="bottom">
    This investment involves a high degree of risk. See &#147;Risk
    Factors&#148; for a discussion of factors you should consider
    carefully before making an investment decision.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 4pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The number of shares of our common stock that will be
    outstanding immediately after this offering is based on
    60,406,828&#160;shares of common stock outstanding as of
    March&#160;31, 2010, and excludes:
</DIV>

<DIV style="margin-top: 4pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    4,914,112&#160;shares of our common stock issuable upon the
    exercise of stock options outstanding under our 2000 stock
    option plan as of March&#160;31, 2010, at a weighted average
    exercise price of $1.53 per share;
</TD>
</TR>


<TR style="line-height: 4pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    1,550,888&#160;shares of our common stock available for future
    issuance under our 2000 stock option plan;
</TD>
</TR>


<TR style="line-height: 4pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    7,933,851&#160;shares of our common stock issuable upon the
    exercise of outstanding warrants as of March&#160;31, 2010, at a
    weighted-average exercise price of $2.01 per share;&#160;and
</TD>
</TR>


<TR style="line-height: 4pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    shares issuable upon exercise of warrants to be issued in
    connection with this offering.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 4pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Except as otherwise indicated herein, all information in this
    prospectus, including the number of shares that will be
    outstanding after this offering, assumes or gives effect to:
</DIV>

<DIV style="margin-top: 4pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    no exercise of options or warrants outstanding on the date of
    this prospectus, except as specifically set forth
    herein;&#160;and
</TD>
</TR>


<TR style="line-height: 4pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    no exercise of the underwriters&#146; over-allotment option.
</TD>
</TR>

</TABLE>
<!-- XBRL Pagebreak Begin -->
</DIV><!-- End box 1 -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    5
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<DIV style="width: 100%; height: 9in; border-top: 1px solid #000000; padding-top: 12pt; border-right: 1px solid #000000; padding-right: 12pt; border-bottom: 1px solid #000000; padding-bottom: 12pt; border-left: 1px solid #000000; padding-left: 12pt"><!-- Begin box 1 -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Summary
    Financial Data</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following tables summarize our financial data. We have
    derived the following summary of our statement of operations
    data for the years ended December&#160;31, 2009 and 2008 and
    balance sheet data as of December&#160;31, 2009 from our audited
    financial statements appearing later in this prospectus. Our
    historical results are not necessarily indicative of the results
    that may be expected in the future. You should read the summary
    of our financial data set forth below together with our
    financial statements and the related notes to those statements,
    as well as &#147;Management&#146;s Discussion and Analysis of
    Financial Condition and Results of Operations&#148; appearing
    later in this prospectus.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have presented the summary balance sheet data:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    on an actual basis as of December&#160;31, 2009;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    on an as adjusted basis to give effect to our sale
    of&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
    units in this offering at a public offering price of
    $&#160;&#160;&#160;&#160;&#160; per unit, after deducting
    underwriting discounts and commissions and estimated offering
    expenses payable by us.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="71%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="10%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="10%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Year Ended December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Statement of Operations Data:</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Sponsored research revenue
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    168,412
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Operating expenses:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Research and development
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,724,514
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7,149,808
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    General and administrative
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,781,790
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,805,346
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Total operating expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,506,304
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    10,955,154
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Loss from operations
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (6,506,304
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (10,786,742
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Interest income
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    12,444
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    149,777
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net loss
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (6,493,860
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (10,636,965
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Basic and diluted net loss per share
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (0.12
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (0.21
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Shares used to compute basic and diluted net loss per share
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    55,680,525
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    50,967,617
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="75%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="5%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="4%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>As of December&#160;31, 2009</B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Actual</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>As Adjusted</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Balance Sheet Data:</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Cash and cash equivalents
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    4,355,768
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Working capital
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,671,910
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Total assets
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,583,754
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Common stock
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    60,407
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Additional
    <FONT style="white-space: nowrap">paid-in</FONT>
    capital
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    88,144,347
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Accumulated deficit
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (84,501,404
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Total stockholders&#146; equity
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,703,350
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>
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    <BR>
    6
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<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<A name='102'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">RISK
    FACTORS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Investing in our securities involves a high degree of risk.
    You should carefully consider the risks described below, as well
    as the other information included in this prospectus, before you
    decide to purchase our securities. If any of the following risks
    actually occurs, they may harm our business, prospects,
    financial condition and operating results. As a result, the
    trading price of our securities could decline and you could lose
    part or all of your investment.</I>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Risks
    Related to Our Liquidity and Need for Financing</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Even
    after giving effect to the proceeds of this offering, we
    estimate that our capital resources will only be sufficient to
    fund our operations into the third quarter of
    2011.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We intend to use the proceeds from this offering to fund our
    ongoing research and development activities; however, we may not
    be able to complete all of the trials we intend to initiate in
    2010 or beyond 2010 without additional funding. We intend to use
    a portion of the proceeds of this offering, together with our
    existing capital resources, to fund our existing initiatives in
    supporting a Phase 1/2 clinical trial of
    <FONT style="white-space: nowrap">RGN-352</FONT> in
    patients with multiple sclerosis, supporting ongoing
    compassionate use studies of RGN-259 in patients with corneal
    defects, and completing our ongoing Phase 2 trial of RGN-137 in
    patients with EB. We also intend to use a portion of the
    proceeds of this offering to initiate and conduct at least a
    portion of a Phase 2 clinical trial of RGN-352 in patients who
    have suffered an acute myocardial infarction. We expect that the
    Phase 2 trial design will allow for an interim review of patient
    data from an initial group of evaluated patients, and we
    currently expect that the proceeds of this offering will be
    sufficient to reach this point in the trial.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our forecast of the period of time through which our financial
    resources will be adequate to support our operations is a
    forward-looking statement and involves risks and uncertainties,
    and actual results could vary as a result of a number of
    factors, including the factors discussed elsewhere in these risk
    factors. We have based this estimate on assumptions that may
    prove to be wrong, and we could use our available capital
    resources and the proceeds from this offering sooner than we
    currently expect.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">In
    addition to our current development objectives, we will need
    substantial additional capital for the continued development of
    product candidates through marketing approval and for our
    longer-term future operations.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Beyond our current liquidity needs, we anticipate that
    substantial new capital resources will be required to continue
    our longer-term independent product development efforts,
    including any and all follow-on trials that will result from our
    current clinical programs beyond those currently contemplated,
    and to scale up manufacturing processes for our product
    candidates. The actual amount of funds that we will need will be
    determined by many factors, some of which are beyond our
    control. These factors include, without limitation:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the scope of our clinical trials, which is significantly
    influenced by the quality of clinical data achieved as trials
    are completed and the requirements established by regulatory
    authorities;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the speed with which we complete our clinical trials, which
    depends on our ability to attract and enroll qualifying patients
    and the quality of the work performed by our clinical
    investigators;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the time required to prosecute, enforce and defend our
    intellectual property rights, which depends on evolving legal
    regimes and infringement claims that may arise between us and
    third parties;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the ability to manufacture at scales sufficient to supply
    commercial quantities of any of our product candidates that
    receive regulatory approval, which may require levels of effort
    not currently anticipated;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the successful commercialization of our product candidates,
    which will depend on our ability to either create or partner
    with an effective commercialization organization and which could
    be delayed or prevented by the emergence of equal or more
    effective therapies.
</TD>
</TR>

</TABLE>
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    <BR>
    7
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<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Emerging biotechnology companies like us may raise capital
    through corporate collaborations and by licensing intellectual
    property rights to other biotechnology or pharmaceutical
    enterprises. We intend to pursue this strategy, but there can be
    no assurance that we will be able to license our intellectual
    property or product development programs on commercially
    reasonable terms, if at all. There are substantial challenges
    and risks that will make it difficult to successfully implement
    any of these alternatives. If we are successful in raising
    additional capital through such a license or collaboration, we
    may have to give up valuable rights to our intellectual
    property. In addition, the business priorities of a strategic
    partner may change over time, which creates the possibility that
    the interests of the strategic partner in developing our
    technology may diminish, which could have a potentially material
    negative impact on the value of our interest in the licensed
    intellectual property or product candidates.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Further, if we raise additional funds by selling shares of our
    common stock or securities convertible into our common stock,
    the ownership interest of our existing stockholders may be
    significantly diluted. If additional funds are raised through
    the issuance of preferred stock or debt securities, these
    securities are likely to have rights, preferences and privileges
    senior to our common stock and may involve significant fees,
    interest expense, restrictive covenants or the granting of
    security interests in our assets.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our failure to successfully address long-term liquidity
    requirements would have a material negative impact on our
    business, including the possibility of surrendering our rights
    to some technologies or product opportunities, delaying our
    clinical trials or ceasing our operations.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">We
    have incurred losses since inception and expect to incur
    significant losses in the foreseeable future and may never
    become profitable.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have not commercialized any product candidates to date and
    incurred net operating losses every year since our inception in
    1982. We believe these losses will continue for the foreseeable
    future, and may increase, as we pursue our product development
    efforts related to T&#223;4. As of December&#160;31, 2009, our
    accumulated deficit totaled approximately $84.5&#160;million.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As we expand our research and development efforts and seek to
    obtain regulatory approval of our product candidates to make
    them commercially viable, we anticipate substantial and
    increasing operating losses. Our ability to generate additional
    revenues and to become profitable will depend largely on our
    ability, alone or through the efforts of third-party licensees
    and collaborators, to efficiently and successfully complete the
    development of our product candidates, obtain necessary
    regulatory approvals for commercialization,
    <FONT style="white-space: nowrap">scale-up</FONT>
    commercial quantity manufacturing capabilities either internally
    or through third-party suppliers, and market our product
    candidates. There can be no assurance that we will achieve any
    of these objectives or that we will ever become profitable or be
    able to maintain profitability. Even if we do achieve
    profitability, we cannot predict the level of such
    profitability. If we sustain losses over an extended period of
    time and are not otherwise able to raise necessary funds to
    continue our development efforts and maintain our operations, we
    may be forced to cease operations.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">We are
    currently not in compliance with NYSE Amex rules regarding the
    minimum shareholders&#146; equity requirement and are at risk of
    being delisted from the NYSE Amex stock exchange, which may
    subject us to the SEC&#146;s penny stock rules and decrease the
    liquidity of our common stock.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Because of our historical losses from operations, NYSE Amex
    rules require that we maintain minimum stockholders&#146; equity
    of $6&#160;million, unless our market capitalization exceeds
    $50&#160;million. We are not currently in compliance with either
    of these continued listing standards. In the second quarter of
    2009, we submitted a compliance plan to the NYSE Amex that
    forecasted our ability to regain compliance with the listing
    standards by October 2010. NYSE Amex has accepted our compliance
    plan, which is subject to periodic review by NYSE Amex to
    determine whether we are making progress consistent with the
    plan. Our compliance plan contemplates the raise of additional
    equity capital, such as through this offering. While the
    proceeds of this offering may enable us to achieve compliance
    with the $6&#160;million stockholders&#146; equity requirement,
    we will likely require additional capital in the future to
    maintain compliance with this continued listing standard.
    Additionally, we cannot assure you that we will meet or maintain
    compliance with the $50&#160;million market
</DIV>
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    <BR>
    8
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    capitalization alternative standard after completion of this
    offering. Even if we raise net proceeds equal to or greater than
    the amount required to satisfy the $6&#160;million
    stockholders&#146; equity requirement, there can be no assurance
    that, because of our significant operating cash requirements, we
    will be able to maintain compliance with that requirement or
    remain eligible for continued listing on the NYSE Amex. Further,
    even if we raise net proceeds equal to or greater than the
    amount necessary to regain compliance, there can be no assurance
    that NYSE Amex will agree that we have satisfied the compliance
    plan.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If we do not achieve or maintain compliance with NYSE Amex
    listing rules, we expect that our common stock would be delisted
    from the NYSE Amex exchange. Following any such delisting, our
    common stock may be traded
    <FONT style="white-space: nowrap">over-the-counter</FONT>
    on the OTC Bulletin&#160;Board or in the &#147;pink
    sheets.&#148; These alternative markets, however, are generally
    considered to be less efficient than, and not as broad as, the
    NYSE Amex exchange. If our common stock is delisted from NYSE
    Amex, there may be a limited market for our stock, trading in
    our stock may become more difficult and our share price could
    decrease even further. Specifically, you may not be able to
    resell your shares of common stock at or above the price you
    paid for such shares or at all.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In addition, if our common stock is delisted, our ability to
    raise additional capital may be impaired because of the less
    liquid nature of the OTC Bulletin&#160;Board and the pink
    sheets. While we cannot guarantee that we would be able to
    complete an equity financing on acceptable terms, or at all, we
    believe that dilution from any equity financing while our shares
    are quoted on the OTC Bulletin&#160;Board or the pink sheets
    would likely be substantially greater than if we were to
    complete the financing while our common stock is traded on the
    NYSE Amex exchange.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In the event our common stock is delisted, it may also become
    subject to penny stock rules. The SEC generally defines
    &#147;penny stock&#148; as an equity security that has a market
    price of less than $5.00 per share, subject to certain
    exceptions. We are not currently subject to the penny stock
    rules because our common stock qualifies for an exception to the
    SEC&#146;s penny stock rules for companies that have an equity
    security that is quoted on an exchange. However, if we were
    delisted, our common stock would become subject to the penny
    stock rules, which impose additional sales practice requirements
    on broker-dealers who sell our common stock. If our common stock
    were considered penny stock, the ability of broker-dealers to
    sell our common stock and the ability of our stockholders to
    sell their shares in the secondary market would be limited and,
    as a result, the market liquidity for our common stock would
    likely be adversely affected. We cannot assure you that trading
    in our securities will not be subject to these or other
    regulations in the future.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">The
    report of our independent registered public accounting firm
    contains explanatory language that substantial doubt exists
    about our ability to continue as a going concern.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The report of our independent registered public accounting firm
    on our financial statements for the year ended December&#160;31,
    2009 contains explanatory language that substantial doubt exists
    about our ability to continue as a going concern, without
    raising additional capital. Although we expect that the proceeds
    of this offering will provide us the ability to fund our
    operations through the third quarter of 2011, we will continue
    to have a need for additional financing after this offering,
    which we may not be able to complete either on favorable terms
    or at all. As a result, we cannot assure you that, after taking
    into account the proceeds of this offering and our anticipated
    expenditures for the remainder of 2010, the report of our
    independent registered public accounting firm for the year
    ending December&#160;31, 2010 will not express substantial doubt
    about our ability to continue as a going concern. If this were
    to occur, we would once again face the need to obtain sufficient
    financing in the short term, and the failure to do so would, in
    all likelihood, create severe liquidity problems and cause us to
    have to curtail our operations. If we were to curtail our
    operations, we could be placed into bankruptcy or undergo
    liquidation, the result of which would adversely affect the
    value of our common stock.
</DIV>
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    <BR>
    9
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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    <B><FONT style="font-family: 'Times New Roman', Times">Risks
    Related to Our Business and Operations</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">All of
    our drug candidates are based on a single compound that has yet
    to be proven effective in human subjects.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our current primary business focus is the development of
    T&#223;4, and its analogues, derivatives and fragments, for the
    improvement of cardiac function, the acceleration of corneal
    healing, the treatment of non-healing wounds and other
    conditions. Unlike many pharmaceutical companies that have a
    number of unique chemical entities in development, we are
    dependent on a single molecule, formulated for different routes
    of administration and different clinical indications, for our
    potential commercial success. As a result, any common safety or
    efficacy concerns for T&#223;4-based products that cross
    formulations would have a much greater impact on our business
    prospects than if our product pipeline were more diversified.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">We may
    never be able to commercialize our product
    candidates.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Although T&#223;4 has shown biological activity in
    <I>in&#160;vitro </I>and animal models, we cannot assure you
    that our product candidates will exhibit activity or importance
    in humans. Our drug candidates are still in research and
    development, and we do not expect them to be commercially
    available for the foreseeable future, if at all. Only a small
    number of research and development programs ultimately result in
    commercially successful drugs. Potential products that appear to
    be promising at early stages of development may not reach the
    market for a number of reasons. These include the possibility
    that the potential products may:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    be found ineffective or cause harmful side effects during
    preclinical studies or clinical trials;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    fail to receive necessary regulatory approvals;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    be precluded from commercialization by proprietary rights of
    third parties;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    be difficult to manufacture on a large scale;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    be uneconomical or otherwise fail to achieve market acceptance.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If any of these potential problems occurs, we may never
    successfully market T&#223;4-based products.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">We are
    subject to intense government regulation, and we may not receive
    regulatory approvals for our drug candidates.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our product candidates will require regulatory approvals prior
    to sale. In particular, therapeutic agents are subject to
    stringent approval processes, prior to commercial marketing, by
    the FDA and by comparable agencies in most foreign countries.
    The process of obtaining FDA and corresponding foreign approvals
    is costly and time-consuming, and we cannot assure you that such
    approvals will be granted. Also, the regulations we are subject
    to change frequently and such changes could cause delays in the
    development of our product candidates.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Three of our drug candidates are currently in the clinical
    stage, and we cannot be certain that we or our collaborators
    will successfully complete the clinical trials necessary to
    receive regulatory product approvals. The regulatory approval
    process is lengthy, unpredictable and expensive. To obtain
    regulatory approvals in the United States, we or a collaborator
    must ultimately demonstrate to the satisfaction of the
    U.S.&#160;Food and Drug Administration, or FDA, that our product
    candidates are sufficiently safe and effective for their
    proposed administration to humans. Many factors, known and
    unknown, can adversely impact clinical trials and the ability to
    evaluate a product candidate&#146;s safety and efficacy,
    including:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the FDA or other health regulatory authorities, or institutional
    review boards, or IRBs, do not approve a clinical trial protocol
    or place a clinical trial on hold;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    suitable patients do not enroll in a clinical trial in
    sufficient numbers or at the expected rate, for reasons such as
    the size of the patient population, the proximity of patients to
    clinical sites, the eligibility criteria for the trial, the
    perceptions of investigators and patients regarding safety, and
    the availability of other treatment options;
</TD>
</TR>

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    <BR>
    10
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<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    clinical trial data is adversely affected by trial conduct or
    patient withdrawal prior to completion of the trial;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    there may be competition with ongoing clinical trials and
    scheduling conflicts with participating clinicians;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    patients experience serious adverse events, including adverse
    side effects of our drug candidates, for a variety of reasons
    that may or may not be related to our product candidates,
    including the advanced stage of their disease and other medical
    problems;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    patients in the placebo or untreated control group exhibit
    greater than expected improvements or fewer than expected
    adverse events;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    third-party clinical investigators do not perform the clinical
    trials on the anticipated schedule or consistent with the
    clinical trial protocol and good clinical practices, or other
    third-party organizations do not perform data collection and
    analysis in a timely or accurate manner;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    service providers, collaborators or co-sponsors do not
    adequately perform their obligations in relation to the clinical
    trial or cause the trial to be delayed or terminated;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    we are unable to obtain a sufficient supply of manufactured
    clinical trial materials;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    regulatory inspections of manufacturing facilities, which may,
    among other things, require us or a
    <FONT style="white-space: nowrap">co-sponsor</FONT>
    to undertake corrective action or suspend the clinical trials;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the interim results of the clinical trial are inconclusive or
    negative;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the clinical trial, although approved and completed, generates
    data that is not considered by the FDA or others to be
    sufficient to demonstrate safety and efficacy;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    changes in governmental regulations or administrative actions
    affect the conduct of the clinical trial or the interpretation
    of its results.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    There can be no assurance that our clinical trials will in fact
    demonstrate, to the satisfaction of the FDA and others, that our
    product candidates are sufficiently safe or effective. The FDA
    or we may also restrict or suspend our clinical trials at any
    time if either believes that we are exposing the subjects
    participating in the trials to unacceptable health risks.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Clinical trials for product candidates such as ours are often
    conducted with patients who have more advanced forms of a
    particular condition or other unrelated conditions. For example,
    in clinical trials for our product candidate RGN-137, we have
    studied patients who are not only suffering from chronic
    epidermal wounds but who are also older and much more likely to
    have other serious adverse conditions. During the course of
    treatment with our product candidates, patients could die or
    suffer other adverse events for reasons that may or may not be
    related to the drug candidate being tested. Further, and as a
    consequence of all of our drug candidates being based on
    T&#223;4, crossover risk exists such that a patient in one trial
    may be adversely impacted by one drug candidate, and that
    adverse event may have implications for our other trials and
    other drug candidates. However, even if unrelated to our product
    candidates, such adverse events can nevertheless negatively
    impact our clinical trials, and our business prospects would
    suffer.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    These factors, many of which may be outside of our control, may
    have a negative impact on our business by making it difficult to
    advance product candidates or by reducing or eliminating their
    potential or perceived value. As a consequence, we may need to
    perform more or larger clinical trials than planned. Further, if
    we are forced to contribute greater financial and clinical
    resources to a study, valuable resources will be diverted from
    other areas of our business. If we fail to complete or if we
    experience material delays in completing our clinical trials as
    currently planned, or we otherwise fail to commence or complete,
    or experience delays in, any of our other present or planned
    clinical trials, including as a result of the actions of third
    parties upon which we rely for these functions, our ability to
    conduct our business as currently planned could materially
    suffer.
</DIV>
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    <BR>
    11
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">We may
    not successfully establish and maintain development and testing
    relationships with third-party service providers and
    collaborators, which could adversely affect our ability to
    develop our product candidates.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have only limited resources, experience with and capacity to
    conduct requisite testing and clinical trials of our drug
    candidates. As a result, we rely and expect to continue to rely
    on third-party service providers and collaborators, including
    corporate partners, licensors and contract research
    organizations, or CROs, to perform a number of activities
    relating to the development of our drug candidates, including
    the design and conduct of clinical trials, and potentially the
    obtaining of regulatory approvals. For example, we currently
    rely on several third-party contractors to manufacture and
    formulate T&#223;4 into the product candidates used in our
    clinical trials, develop assays to assess T&#223;4&#146;s
    effectiveness in complex biological systems, recruit clinical
    investigators and sites to participate in our trials, manage the
    clinical trial process and collect, evaluate and report clinical
    results.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We may not be able to maintain or expand our current
    arrangements with these third parties or maintain such
    relationships on favorable terms. Our agreements with these
    third parties may also contain provisions that restrict our
    ability to develop and test our product candidates or that give
    third parties rights to control aspects of our product
    development and clinical programs. In addition, conflicts may
    arise with our collaborators, such as conflicts concerning the
    interpretation of clinical data, the achievement of milestones,
    the interpretation of financial provisions or the ownership of
    intellectual property developed during the collaboration. If any
    conflicts arise with our existing or future collaborators, they
    may act in their self-interest, which may be adverse to our best
    interests. Any failure to maintain our collaborative agreements
    and any conflicts with our collaborators could delay or prevent
    us from developing our product candidates. We and our
    collaborators may fail to develop products covered by our
    present and future collaborations if, among other things:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    we do not achieve our objectives under our collaboration
    agreements;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    we or our collaborators are unable to obtain patent protection
    for the products or proprietary technologies we develop in our
    collaborations;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    we are unable to manage multiple simultaneous product
    development collaborations;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    our collaborators become competitors of ours or enter into
    agreements with our competitors;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    we or our collaborators encounter regulatory hurdles that
    prevent commercialization of our product candidates;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    we develop products and processes or enter into additional
    collaborations that conflict with the business objectives of our
    other collaborators.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We also have less control over the timing and other aspects of
    our clinical trials than if we conducted the monitoring and
    supervision entirely on our own. Third parties may not perform
    their responsibilities for our clinical trials on our
    anticipated schedule or consistent with a clinical trial
    protocol or applicable regulations. We also rely on clinical
    research organizations to perform much of our data management
    and analysis. They may not provide these services as required or
    in a timely manner. If any of these parties do not meet
    deadlines or follow proper procedures, including procedures
    required by law, the preclinical studies and clinical trials may
    take longer than expected, may be delayed or may be terminated,
    which would have a materially negative impact on our product
    development efforts. If we were forced to find a replacement
    entity to perform any of our preclinical studies or clinical
    trials, we may not be able to find a suitable entity on
    favorable terms or at all. Even if we were able to find a
    replacement, resulting delays in the tests or trials may result
    in significant additional expenditures and delays in obtaining
    regulatory approval for drug candidates, which could have a
    material adverse impact on our results of operations and
    business prospects.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">We are
    subject to intense competition from companies with greater
    resources and more mature products, which may result in our
    competitors developing or commercializing products before or
    more successfully than we do.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We are engaged in a business that is highly competitive.
    Research and development activities for the development of drugs
    to treat indications within our focus are being sponsored or
    conducted by private and
</DIV>
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    12
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    public research institutions and by major pharmaceutical
    companies located in the United States and a number of foreign
    countries. Most of these companies and institutions have
    financial and human resources that are substantially greater
    than our own, and they have extensive experience in conducting
    research and development activities and clinical trials and in
    obtaining the regulatory approvals necessary to market
    pharmaceutical products that we do not have. As a result, they
    may develop competing products more rapidly that are safer, more
    effective, or have fewer side effects, or are less expensive, or
    they may develop and commercialize products that render our
    product candidates non-competitive or obsolete.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have initially targeted our product candidate RGN-352 for
    cardiovascular indications. Most large pharmaceutical companies
    and many smaller biomedical companies are vigorously pursuing
    the development of therapeutics to treat patients after heart
    attacks and other cardiovascular indications. With respect to
    our product candidate RGN-259 for corneal defects, there are
    also numerous ophthalmic companies developing drugs for corneal
    wound healing and other
    <FONT style="white-space: nowrap">outside-of-the-eye</FONT>
    diseases and injuries. Amniotic membranes have been successfully
    used to treat corneal wounds in certain cases, as have topical
    steroids and antibacterial agents. With respect to our product
    candidate RGN-137 for wound healing, Johnson&#160;&#038; Johnson
    has previously marketed
    Regranex<SUP style="font-size: 85%; vertical-align: top"><FONT style="font-variant: SMALL-CAPS">tm</FONT></SUP>

    for this purpose in patients with diabetic foot ulcers. Other
    companies, such as Novartis, are developing and marketing
    artificial skins, which we believe could also compete with
    RGN-137. Moreover, wound healing is a large and highly
    fragmented marketplace attracting many companies, large and
    small, to develop products for treating acute and chronic
    wounds, including, for example, honey-based ointments,
    hyperbaric oxygen therapy, and low frequency cavitational
    ultrasound.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We are also developing potential cosmeceutical products, which
    are loosely defined as products that bridge the gap between
    cosmetics and pharmaceuticals, for example, by improving skin
    texture and reducing the appearance of aging. This industry is
    intensely competitive, with potential competitors ranging from
    large multinational companies to very small specialty companies.
    New cosmeceutical products often have a short product life and
    are frequently replaced with newer products developed to address
    the latest trends in appearance and fashion. We may not be able
    to adapt to changes in the industry as quickly as larger and
    more experienced cosmeceutical companies. Further, larger
    cosmetics companies have the financial and marketing resources
    to effectively compete with smaller companies like us in order
    to sell products aimed at larger markets.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Even
    if approved for marketing, our technologies and product
    candidates are unproven and they may fail to gain market
    acceptance.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our product candidates, all of which are based on the molecule
    T&#223;4, are new and unproven and there is no guarantee that
    health care providers or patients will be interested in our
    product candidates, even if they are approved for use. If any of
    our product candidates are approved by the FDA, our success will
    depend in part on our ability to demonstrate sufficient clinical
    benefits, reliability, safety, and cost effectiveness of our
    product candidates relative to other approaches, as well as on
    our ability to continue to develop our product candidates to
    respond to competitive and technological changes. If the market
    does not accept our product candidates, when and if we are able
    to commercialize them, then we may never become profitable.
    Factors that could delay, inhibit or prevent market acceptance
    of our product candidates may include:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the timing and receipt of marketing approvals;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the safety and efficacy of the products;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the emergence of equivalent or superior products;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the cost-effectiveness of the products;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    ineffective marketing.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    It is difficult to predict the future growth of our business, if
    any, and the size of the market for our product candidates
    because the markets are continually evolving. There can be no
    assurance that our product candidates will prove superior to
    products that may currently be available or may become available
    in the future or that our research and development activities
    will result in any commercially profitable products.
</DIV>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">We
    have no marketing experience, sales force or distribution
    capabilities. If our product candidates are approved, and we are
    unable to recruit key personnel to perform these functions, we
    may not be able to commercialize them
    successfully.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Although we do not currently have any marketable products, our
    ability to produce revenues ultimately depends on our ability to
    sell our product candidates if and when they are approved by the
    FDA and other regulatory authorities. We currently have no
    experience in marketing or selling pharmaceutical products, and
    we do not have a marketing and sales staff or distribution
    capabilities. Developing a marketing and sales force is also
    time-consuming and could delay the launch of new products or
    expansion of existing product sales. In addition, we will
    compete with many companies that currently have extensive and
    well-funded marketing and sales operations. If we fail to
    establish successful marketing and sales capabilities or fail to
    enter into successful marketing arrangements with third parties,
    our ability to generate revenues will suffer.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">If we
    enter markets outside the United States our business will be
    subject to political, economic, legal and social risks in those
    markets, which could adversely affect our
    business.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    There are significant regulatory and legal barriers to entering
    markets outside the United States that we must overcome if we
    seek regulatory approval to market our product candidates in
    countries other than the United States. We would be subject to
    the burden of complying with a wide variety of national and
    local laws, including multiple and possibly overlapping and
    conflicting laws. We also may experience difficulties adapting
    to new cultures, business customs and legal systems. Any sales
    and operations outside the United States would be subject to
    political, economic and social uncertainties including, among
    others:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    changes and limits in import and export controls;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    increases in custom duties and tariffs;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    changes in currency exchange rates;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    economic and political instability;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    changes in government regulations and laws;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    absence in some jurisdictions of effective laws to protect our
    intellectual property rights;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    currency transfer and other restrictions and regulations that
    may limit our ability to sell certain product candidates or
    repatriate profits to the United States.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Any changes related to these and other factors could adversely
    affect our business if and to the extent we enter markets
    outside the United States.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Governmental
    and third-party payors may subject any product candidates we
    develop to sales and pharmaceutical pricing controls that could
    limit our product revenues and delay
    profitability.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The successful commercialization of our product candidates, if
    they are approved by the FDA, will likely depend on our ability
    to obtain reimbursement for the cost of the product and
    treatment. Government authorities, private health insurers and
    other organizations, such as health maintenance organizations,
    are increasingly seeking to lower the prices charged for medical
    products and services. Also, the trend toward managed health
    care in the United States, the growth of healthcare maintenance
    organizations, and recently enacted legislation reforming
    healthcare and proposals to reform government insurance programs
    could have a significant influence on the purchase of healthcare
    services and products, resulting in lower prices and reducing
    demand for our product candidates. The cost containment measures
    that healthcare providers are instituting and any healthcare
    reform could reduce our ability to sell our product candidates
    and may have a material adverse effect on our operations. We
    cannot assure you that reimbursement in the United States or
    foreign countries will be available for any of our product
    candidates, and that any reimbursement granted will be
    maintained, or that limits on reimbursement available from
    third-party payors will not reduce the demand for, or the price
    of, our product candidates. The lack or inadequacy of
    third-party reimbursements for our product candidates would
    decrease the potential profitability of our operations. We
    cannot forecast what
</DIV>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    additional legislation or regulation relating to the healthcare
    industry or third-party coverage and reimbursement may be
    enacted in the future, or what effect the legislation or
    regulation would have on our business.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">We
    have no manufacturing or formulation capabilities and are
    dependent upon third-party suppliers to provide us with our
    product candidates. If these suppliers do not manufacture our
    product candidates in sufficient quantities, at acceptable
    quality levels and at acceptable cost, or if we are unable to
    identify suitable replacement suppliers if needed, our clinical
    development efforts could be delayed, prevented or
    impaired.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We do not own or operate manufacturing facilities and have
    little experience in manufacturing pharmaceutical products. We
    currently rely, and expect to continue to rely, primarily on
    peptide manufacturers to supply us with T&#223;4 for further
    formulation into our product candidates. We have engaged three
    separate smaller drug formulation contractors for the
    formulation of clinical grade product candidates, one for each
    of our three product candidates in clinical development. We
    currently do not have an alternative source of supply for either
    T&#223;4 or the individual drug candidates. If these suppliers,
    together or individually, are not able to supply us with either
    T&#223;4 or individual product candidates on a timely basis, in
    sufficient quantities, at acceptable levels of quality and at a
    competitive price, or if we are unable to identify a replacement
    manufacturer to perform these functions on acceptable terms as
    needed, our development programs could be seriously jeopardized.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The risks of relying solely on single suppliers for each of our
    product candidates include:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Their respective abilities to ensure quality and compliance with
    regulations relating to the manufacture of pharmaceuticals;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Their manufacturing capacity may not be sufficient or available
    to produce the required quantities of our product candidates
    based on our planned clinical development schedule, if at all;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    They may not have access to the capital necessary to expand
    their manufacturing facilities in response to our needs;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Commissioning replacement suppliers would be difficult and
    time-consuming;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Individual suppliers may have used substantial proprietary
    know-how relating to the manufacture of our product candidates
    and, in the event we must find a replacement or supplemental
    supplier, our ability to transfer this know-how to the new
    supplier could be an expensive
    <FONT style="white-space: nowrap">and/or</FONT>
    time-consuming process;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    An individual supplier may experience events, such as a fire or
    natural disaster, that force it to stop or curtail production
    for an extended period;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    An individual supplier could encounter significant increases in
    labor, capital or other costs that would make it difficult for
    them to produce our products cost-effectively;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    An individual supplier may not be able to obtain the raw
    materials or validated drug containers in sufficient quantities,
    at acceptable costs or in sufficient time to complete the
    manufacture, formulation and delivery of our product candidates.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Our
    suppliers may use hazardous and biological materials in their
    businesses. Any claims relating to improper handling, storage or
    disposal of these materials could be time-consuming and costly
    to us, and we are not insured against such claims.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our product candidates and processes involve the controlled
    storage, use and disposal by our suppliers of certain hazardous
    and biological materials and waste products. We and our
    suppliers and other collaborators are subject to federal, state
    and local regulations governing the use, manufacture, storage,
    handling and disposal of materials and waste products. Even if
    we and these suppliers and collaborators comply with the
    standards prescribed by law and regulation, the risk of
    accidental contamination or injury from hazardous materials
    cannot be completely eliminated. In the event of an accident, we
    could be held liable for any damages that result, and we do not
    carry insurance for this type of claim. We may also incur
    significant costs to comply with current or future environmental
    laws and regulations.
</DIV>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">We
    face the risk of product liability claims, which could adversely
    affect our business and financial condition.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We may be subject to product liability claims as a result of our
    testing, manufacturing, and marketing of drugs. In addition, the
    use of our product candidates, when and if developed and sold,
    will expose us to the risk of product liability claims. Product
    liability may result from harm to patients using our product
    candidates, such as a complication that was either not
    communicated as a potential side effect or was more extreme than
    anticipated. We require all patients enrolled in our clinical
    trials to sign consents, which explain various risks involved
    with participating in the trial. However, patient consents
    provide only a limited level of protection, and it may be
    alleged that the consent did not address or did not adequately
    address a risk that the patient suffered. Additionally, we will
    generally be required to indemnify our clinical product
    manufacturers, clinical trial centers, medical professionals and
    other parties conducting related activities in connection with
    losses they may incur through their involvement in the clinical
    trials.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our ability to reduce our liability exposure for human clinical
    trials and commercial sales, if any, of T&#223;4 is dependent in
    part on our ability to obtain sufficient product liability
    insurance or to collaborate with third parties that have
    adequate insurance. Although we intend to obtain and maintain
    product liability insurance coverage if we gain approval to
    market any of our product candidates, we cannot guarantee that
    product liability insurance will continue to be available to us
    on acceptable terms, or at all, or that its coverage will be
    sufficient to cover all claims against us. A product liability
    claim, even one without merit or for which we have substantial
    coverage, could result in significant legal defense costs,
    thereby potentially exposing us to expenses significantly in
    excess of our revenues, as well as harm to our reputation and
    distraction of our management.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">If any
    of our key employees discontinue their services with us, our
    efforts to develop our business may be delayed.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We are highly dependent on the principal members of our
    management team. The loss of our chairman and chief scientific
    advisor, Allan Goldstein, or our chief executive officer, J.J.
    Finkelstein, could prevent or significantly delay the
    achievement of our goals. We have employment agreements with
    Dr.&#160;Goldstein and Mr.&#160;Finkelstein. For part of 2009,
    we effected salary reductions for certain of our employees,
    including Dr.&#160;Goldstein and Mr.&#160;Finkelstein. Although
    their salaries were restored effective as of October&#160;1,
    2009, we cannot assure you that they, or other key employees,
    may elect to terminate their employment as a result of the
    salary reductions or for other reasons. In addition, we do not
    maintain a key man life insurance policy with respect to
    Dr.&#160;Goldstein or Mr.&#160;Finkelstein. In the future, we
    anticipate that we may need to add additional management and
    other personnel. Competition for qualified personnel in our
    industry is intense, and our success will depend in part on our
    ability to attract and retain highly skilled personnel. We
    cannot assure you that our efforts to attract or retain such
    personnel will be successful.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Mauro
    Bove, a member of our Board, is also a director and officer of
    entities affiliated with Sigma-Tau, a relationship which could
    give rise to a conflict of interest involving
    Mr.&#160;Bove.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Mauro Bove, a member of our Board of Directors, is also a
    director and officer of entities affiliated with Sigma-Tau,
    which collectively make up our largest stockholder group.
    Sigma-Tau has provided us with significant funding, may continue
    doing so in the future, and is also our strategic partner in
    Europe with respect to the development of certain of our drug
    candidates. During 2008 and 2009, we issued shares of common
    stock and common stock warrants to Sigma-Tau in four separate
    private placement financing transactions, but we retained the
    right to repurchase some of these shares under certain
    circumstances.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have licensed certain rights to our product candidates
    generally for the treatment of dermal and internal wounds to
    Sigma-Tau. Under the license agreement, upon the completion of a
    Phase 2 clinical trial of either of these product candidates
    that yields positive results in terms of clinical efficacy and
    safety, Sigma-Tau is obligated to either make a $5&#160;million
    milestone payment to us or to initiate and fund a pivotal Phase
    3 clinical trial of the product candidate. In 2009, we completed
    two Phase 2 clinical trials of RGN-137 in the treatment of
    pressure ulcers and venous stasis ulcers. However, due to the
    lack of statistical significance of the
</DIV>
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    <BR>
    16
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    reported efficacy results, these trials are not sufficient to
    trigger the milestone obligation described above. There can be
    no assurance that we will ever receive this payment or be able
    to initiate a pivotal Phase 3 clinical trial of RGN-137 that
    would be funded by Sigma-Tau. As a result of
    Mr.&#160;Bove&#146;s relationship with Sigma-Tau, there could be
    a conflict of interest between Sigma-Tau and our other
    stockholders with respect to these and other agreements and
    circumstances that may require the exercise of the Board&#146;s
    discretion with respect to Sigma-Tau. Any decision in the best
    interests of Sigma-Tau may not be in the best interest of our
    other stockholders.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Risks
    Related To Our Intellectual Property</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">We are
    heavily reliant on our license from the National Institutes of
    Health for the rights to T&#223;4, and any loss of these rights
    would adversely affect our business.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have received an exclusive worldwide license to intellectual
    property discovered at the National Institutes of Health, or
    NIH, pertaining to the use of T&#223;4 in wound healing and
    tissue repair. The intellectual property rights from this
    license form the basis for our current commercial development
    focus with T&#223;4. This license terminates upon the last to
    expire of the patent applications that are filed, or any patents
    that may issue from such applications, in connection with the
    license. This license requires us to pay a minimum annual
    royalty to the NIH, regardless of the success of our product
    development efforts, plus certain other royalties upon the sale
    of products created by the intellectual property granted under
    the license. This license may be terminated for a number of
    reasons, including our non-payment of the royalty or lack of
    continued product development, among others. While to date we
    believe that we have complied with all requirements to maintain
    the license, the loss of this license would have a material
    adverse effect on our business and business prospects and may
    require us to cease development of our current line of
    T&#223;4-based product candidates.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">If we
    are not able to maintain adequate patent protection for our
    product candidates, we may be unable to prevent our competitors
    from using our technology or technology that we
    license.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our success will depend in substantial part on our ability to
    obtain, defend and enforce patents, maintain trade secrets and
    operate without infringing upon the proprietary rights of
    others, both in the United States and abroad. Pursuant to an
    exclusive worldwide license from the NIH, we have exclusive
    rights to use T&#223;4 in the treatment of non-healing wounds.
    While patents covering our use of T&#223;4 have issued in some
    countries, we cannot guarantee whether or when corresponding
    patents will be issued, or the scope of any patents that may be
    issued, in other countries. We have attempted to create a
    substantial intellectual property portfolio, submitting patent
    applications for various compositions of matter, methods of use
    and fragments and derivatives of T&#223;4. We have also
    in-licensed other intellectual property rights from third
    parties that could be subject to the same risks as our own
    patents. If any of these patent applications do not issue, or do
    not issue in certain countries, or are not enforceable, the
    ability to commercialize T&#223;4 in various medical indications
    could be substantially limited or eliminated.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In addition, the patent positions of the products being
    developed by us and our collaborators involve complex legal and
    factual uncertainties. As a result, we cannot assure you that
    any patent applications filed by us, or by others under which we
    have rights, will result in patents being issued in the United
    States or foreign countries. In addition, there can be no
    assurance that any patents will be issued from any pending or
    future patent applications of ours or our collaborators, that
    the scope of any patent protection will be sufficient to provide
    us with competitive advantages, that any patents obtained by us
    or our collaborators will be held valid if subsequently
    challenged or that others will not claim rights in or ownership
    of the patents and other proprietary rights we or our
    collaborators may hold. Unauthorized parties may try to copy
    aspects of our product candidates and technologies or obtain and
    use information we consider proprietary. Policing the
    unauthorized use of our proprietary rights is difficult. We
    cannot guarantee that no harm or threat will be made to our or
    our collaborators&#146; intellectual property. In addition,
    changes in, or different interpretations of, patent laws in the
    United States and other countries may also adversely affect the
    scope of our patent protection and our competitive situation.
</DIV>
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    17
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Due to the significant time lag between the filing of patent
    applications and the publication of such patents, we cannot be
    certain that our licensors were the first to file the patent
    applications we license or, even if they were the first to file,
    also were the first to invent, particularly with regards to
    patent rights in the United States. In addition, a number of
    pharmaceutical and biotechnology companies and research and
    academic institutions have developed technologies, filed patent
    applications or received patents on various technologies that
    may be related to our product candidates. Some of these
    technologies, applications or patents may conflict with our or
    our licensors&#146; technologies or patent applications. A
    conflict could limit the scope of the patents, if any, that we
    or our licensors may be able to obtain or result in denial of
    our or our licensors&#146; patent applications. If patents that
    cover our activities are issued to other companies, we may not
    be able to develop or obtain alternative technology.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Additionally, there is certain subject matter that is patentable
    in the United States but not generally patentable outside of the
    United States. Differences in what constitutes patentable
    subject matter in various countries may limit the protection we
    can obtain outside of the United States. For example, methods of
    treating humans are not patentable in many countries outside of
    the United States. These and other issues may prevent us from
    obtaining patent protection outside of the United States, which
    would have a material adverse effect on our business, financial
    condition and results of operations.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Changes
    to U.S. patent laws could materially reduce any value our patent
    portfolio may have.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The value of our patents depends in part on their duration. A
    shorter period of patent protection could lessen the value of
    our rights under any patents that may be obtained and may
    decrease revenues derived from its patents. For example, the
    U.S.&#160;patent laws were previously amended to change the term
    of patent protection from 17&#160;years following patent
    issuance to 20&#160;years from the earliest effective filing
    date of the application. Because the time from filing to
    issuance of biotechnology applications may be more than three
    years depending on the subject matter, a
    <FONT style="white-space: nowrap">20-year</FONT>
    patent term from the filing date may result in substantially
    shorter patent protection. Future changes to patent laws could
    shorten our period of patent exclusivity and may decrease the
    revenues that we might derive from the patents and the value of
    our patent portfolio.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">We may
    not have adequate protection for our unpatented proprietary
    information, which could adversely affect our competitive
    position.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In addition to our patents, we also rely on trade secrets,
    know-how, continuing technological innovations and licensing
    opportunities to develop and maintain our competitive position.
    However, others may independently develop substantially
    equivalent proprietary information and techniques or otherwise
    gain access to our trade secrets or disclose our technology. To
    protect our trade secrets, we may enter into confidentiality
    agreements with employees, consultants and potential
    collaborators. However, we may not have such agreements in place
    with all such parties and, where we do, these agreements may not
    provide meaningful protection of our trade secrets or adequate
    remedies in the event of unauthorized use or disclosure of such
    information. Also, our trade secrets or know-how may become
    known through other means or be independently discovered by our
    competitors. Any of these events could prevent us from
    developing or commercializing our product candidates.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">We may
    be subject to claims that we or our employees have wrongfully
    used or disclosed alleged trade secrets of former
    employers.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As is commonplace in the biotechnology industry, we employ now,
    and may hire in the future, individuals who were previously
    employed at other biotechnology or pharmaceutical companies,
    including competitors or potential competitors. Although there
    are no claims currently pending against us, we may be subject to
    claims that we or certain employees have inadvertently or
    otherwise used or disclosed trade secrets or other proprietary
    information of former employers. Litigation may be necessary to
    defend against these claims. Even if we are successful in
    defending against these claims, litigation could result in
    substantial costs and would be a significant distraction to
    management.
</DIV>
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    18
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Risks
    Related To Our Securities and This Offering</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Our
    common stock price is volatile and has had limited trading
    volume, and any investment in our securities could decline
    substantially in value.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    For the period from January&#160;1, 2009 through the date of
    this prospectus, our closing stock price has fluctuated between
    prices of $0.42 to $1.75 per share, with an average daily
    trading volume of approximately 80,000&#160;shares. In light of
    our small size and limited resources, as well as the
    uncertainties and risks that can affect our business and
    industry, our stock price is expected to continue to be highly
    volatile and can be subject to substantial drops, with or even
    in the absence of news affecting our business. The following
    factors, in addition to the other risk factors described in this
    prospectus, and the potentially low volume of trades in our
    common stock, may have a significant impact on the market price
    of our common stock, some of which are beyond our control:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    results of preclinical studies and clinical trials;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    commercial success of approved products;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    corporate partnerships;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    technological innovations by us or competitors;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    changes in laws and government regulations both in the
    U.S.&#160;and overseas;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    changes in key personnel at our company;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    developments concerning proprietary rights, including patents
    and litigation matters;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    public perception relating to the commercial value or safety of
    any of our product candidates;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    future sales of our common stock;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    future issuance of our common stock causing dilution;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    anticipated or unanticipated changes in our financial
    performance;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    general trends related to the biopharmaceutical and
    biotechnological industries;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    general conditions in the stock market.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The stock market in general has recently experienced relatively
    large price and volume fluctuations. In particular, the market
    prices of securities of smaller biotechnology companies have
    experienced dramatic fluctuations that often have been unrelated
    or disproportionate to the operating results of these companies.
    Continued market fluctuations could result in extreme volatility
    in the price of our common stock, which could cause a decline in
    its value. You should also be aware that price volatility may be
    worse if the trading volume of the common stock remains limited
    or declines.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Our
    principal stockholders have significant voting power and may
    take actions that may not be in the best interests of our other
    stockholders.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As of March&#160;31, 2010, our officers, directors and principal
    stockholders together controlled approximately 52% of our
    outstanding common stock. Included in this group is Sigma-Tau,
    which holds approximately 43% of our outstanding common stock as
    of March&#160;31, 2010. A portion of the shares of common stock
    currently held by Sigma-Tau, representing approximately 18% of
    our outstanding common stock, is subject to voting agreements
    under which we control the voting power of these shares. We
    cannot assure you that these voting agreements would prevent
    Sigma-Tau from taking actions not in your best interests and
    effectively exercising control over us. These voting agreements
    are currently scheduled to expire between June 2010 and
    September 2012. After their expiration, we will have no control
    over the voting of these shares controlled by Sigma-Tau,
    including with respect to the election of directors and approval
    of significant corporate transactions. This concentration of
    ownership may have the effect of delaying or preventing a change
    in control and might
</DIV>
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    19
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    adversely affect the market price of our common stock, and
    therefore may not be in the best interest of our other
    stockholders.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">An
    active trading market for the warrants being sold in this
    offering may not develop.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Prior to this offering, there has been no public market for the
    warrants that are part of the units. We intend to apply for
    listing of the warrants to be issued as a part of the units on
    the NYSE Amex. An active trading market for our warrants may
    never develop, and an active market for our common stock may not
    be sustained. If an active market for our securities does not
    develop, it may be difficult for you to sell the securities you
    purchase in this offering without depressing the market price
    for such securities.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">If
    securities or industry analysts do not publish research or
    reports or publish unfavorable research about our business, the
    price of our common stock and other securities and their trading
    volume could decline.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The trading market for our common stock and other securities
    will depend in part on the research and reports that securities
    or industry analysts publish about us or our business. We do not
    currently have and may never obtain research coverage by
    securities and industry analysts. If securities or industry
    analysts do not commence or maintain coverage of us, the trading
    price for our common stock and other securities would be
    negatively affected. In the event we obtain securities or
    industry analyst coverage, if one or more of the analysts who
    covers us downgrades our securities, the price of our securities
    would likely decline. If one or more of these analysts ceases to
    cover us or fails to publish regular reports on us, interest in
    the purchase of our securities could decrease, which could cause
    the price of our common stock and other securities and their
    trading volume to decline.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Our
    rights to repurchase certain shares of stock held by Sigma-Tau
    expire over time, and we may never be able or elect to exercise
    these rights.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Until June 2010, we have the right to repurchase at a price of
    $5.00 per share a number of shares of common stock issued to
    Sigma-Tau equal to the lesser of the shares sold to Sigma-Tau in
    connection with our private placement of securities in June
    2005, or the number of shares necessary to reduce
    Sigma-Tau&#146;s ownership of our outstanding capital stock to
    an aggregate of approximately 30% at the time of such
    repurchase. In addition, we have the right to repurchase at any
    time until December&#160;31, 2010, for $2.50 per share, up to
    5,000,000&#160;shares of common stock issued to Sigma-Tau in
    connection with a private placement of securities in February
    2008. After December&#160;31, 2010, our rights to repurchase
    common stock held by Sigma-Tau will expire. These provisions
    could, under certain circumstances, allow us to reduce dilution
    by repurchasing these shares at prices lower than the
    then-prevailing market price of our common stock. However, we
    cannot assure you that our share price will increase
    sufficiently to make such repurchases economically feasible or
    that we would avail ourselves of the opportunity to make such
    repurchases even if our share price had risen to such a level.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">A
    significant portion of our total outstanding shares are
    restricted from immediate resale but may be sold into the market
    in the near future. This could cause the market price of our
    common stock to drop significantly, even if our business is
    doing well.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Sales of a substantial number of shares of our common stock in
    the public market could occur at any time. Upon completion of
    this offering, we will have
    outstanding&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock, assuming no exercise of outstanding options or
    warrants. Of these shares,
    the&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    underlying the units sold in this offering
    and&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
    additional shares will be freely tradable,
    and&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
    additional shares of common stock will be available for sale in
    the public market beginning 90&#160;days after the date of this
    prospectus following the expiration of
    <FONT style="white-space: nowrap">lock-up</FONT>
    agreements between our officers, directors and certain
    stockholders and the representative of the underwriters. The
    representative of the underwriters may release these officers,
    directors and stockholders from their
    <FONT style="white-space: nowrap">lock-up</FONT>
    agreements with the underwriters at any time and without notice,
    which would allow for earlier sales of shares in the public
    market. If our stockholders sell, or the market perceives that
    our stockholders intend to sell, substantial amounts of our
    common stock in the public market following this offering, the
    market price of our common stock could decline significantly.
</DIV>
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    <BR>
    20
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">If you
    purchase securities in this offering, you will suffer immediate
    dilution of your investment.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We expect the public offering price of the common stock
    underlying the units to be substantially higher than the net
    tangible book value per share of our common stock. Therefore, if
    you purchase units in this offering, you will pay a price per
    share that substantially exceeds our pro forma net tangible book
    value per share after this offering. Based on a public offering
    price of $&#160;&#160;&#160;&#160;&#160; per unit, you will
    experience immediate dilution of $&#160;&#160;&#160;&#160;&#160;
    per share underlying each unit, representing the difference
    between our pro forma net tangible book value per share after
    giving effect to this offering and the public offering price.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">The
    exercise of options and warrants and other issuances of shares
    of common stock or securities convertible into common stock will
    dilute your interest.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As of March&#160;31, 2010, there were outstanding options to
    purchase an aggregate of 4,914,112&#160;shares of our common
    stock at exercise prices ranging from $0.28 per share to $3.82
    per share, of which options to purchase 3,613,069&#160;shares
    were exercisable as of such date. As of March&#160;31, 2010,
    there were warrants outstanding to purchase
    7,933,851&#160;shares of our common stock, at a weighted average
    exercise price of $2.01 per share. The exercise of options and
    warrants at prices below the market price of our common stock
    could adversely affect the price of shares of our common stock.
    Additional dilution may result from the issuance of shares of
    our capital stock in connection with collaborations or
    manufacturing arrangements or in connection with other financing
    efforts.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Any issuance of our common stock that is not made solely to
    then-existing stockholders proportionate to their interests,
    such as in the case of a stock dividend or stock split, will
    result in dilution to each stockholder by reducing his, her or
    its percentage ownership of the total outstanding shares.
    Moreover, if we issue options or warrants to purchase our common
    stock in the future and those options or warrants are exercised
    or we issue restricted stock, stockholders may experience
    further dilution. Holders of shares of our common stock have no
    preemptive rights that entitle them to purchase their pro rata
    share of any offering of shares of any class or series.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In addition, certain warrants to purchase shares of our common
    stock currently contain an exercise price above the current
    market price for the common stock, or above-market warrants. As
    a result, these warrants may not be exercised prior to their
    expiration and we may not realize any proceeds from their
    exercise.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Our
    certificate of incorporation, our stockholder rights plan and
    Delaware law contain provisions that could discourage or prevent
    a takeover or other change in control, even if such a
    transaction would be beneficial to our stockholders, which could
    affect our stock price adversely and prevent attempts by our
    stockholders to replace or remove our current
    management.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our certificate of incorporation provides our Board with the
    power to issue shares of preferred stock without stockholder
    approval. In addition, under our stockholder rights plan, our
    Board has the discretion to issue certain rights to purchase our
    capital stock to our stockholders when a person acquires in
    excess of 25% of our outstanding common shares. These provisions
    may make it more difficult for stockholders to take corporate
    actions and may have the effect of delaying or preventing a
    change in control, even if such actions or change in control
    would be in your best interests. In addition, we are subject to
    the anti-takeover provisions of Section&#160;203 of the Delaware
    General Corporation Law. Subject to specified exceptions, this
    section provides that a corporation may not engage in any
    business combination with any interested stockholder, as defined
    in that statute, during the three-year period following the time
    that such stockholder becomes an interested stockholder. This
    provision could also have the effect of delaying or preventing a
    change of control of our company. The foregoing factors could
    reduce the price that investors or an acquirer might be willing
    to pay in the future for shares of our common stock.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">We may
    become involved in securities class action litigation that could
    divert management&#146;s attention and harm our business and our
    insurance coverage may not be sufficient to cover all costs and
    damages.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The stock market has from time to time experienced significant
    price and volume fluctuations that have affected the market
    prices for the common stock of pharmaceutical and biotechnology
    companies. These broad
</DIV>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    market fluctuations may cause the market price of our common
    stock to decline. In the past, following periods of volatility
    in the market price of a particular company&#146;s securities,
    securities class action litigation has often been brought
    against that company. We may become involved in this type of
    litigation in the future. Litigation often is expensive and
    diverts management&#146;s attention and resources, which could
    hurt our business, operating results and financial condition.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">We
    have broad discretion in the use of proceeds from this offering
    and may invest or spend the proceeds in ways with which you do
    not agree and in ways that may not yield a return.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We will have broad discretion over the use of proceeds from this
    offering. You may not agree with our decisions, and our use of
    the proceeds may not yield any return on your investment in us.
    Our failure to apply the net proceeds of this offering
    effectively could have a material adverse effect on our
    business, financial condition and results of operations.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">As a
    public company, we continue to be subject to the requirements of
    Section&#160;404 of the Sarbanes-Oxley Act. If we are unable to
    comply with Section&#160;404 in a timely manner it may affect
    the reliability of our internal control over financial
    reporting.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Assessing our staffing and training procedures to improve our
    internal control over financial reporting is an ongoing process.
    We are currently required to comply with Section&#160;404 of the
    Sarbanes-Oxley Act of 2002 and to make an assessment of the
    effectiveness of our internal control over financial reporting.
    However, our independent registered public accounting firm has
    not been engaged to express, nor have they expressed, an opinion
    on the effectiveness of our internal control over financial
    reporting.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We plan to continue to assess our internal controls and
    procedures and intend to take further action as necessary or
    appropriate to address any other matters we identify. Under
    current SEC rules, our independent registered public accounting
    firm will also be required to deliver an attestation report on
    the operating effectiveness of our internal control over
    financial reporting beginning with the year ending
    December&#160;31, 2010.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We cannot be certain at this time that we will be able to
    successfully complete the attestation requirements of
    Section&#160;404 or that we or our independent registered public
    accounting firm will not identify material weaknesses in our
    internal control over financial reporting. If we fail to comply
    with the requirements of Section&#160;404 or if we or our
    independent registered public accounting firm identify and
    report a material weakness, it may affect the reliability of our
    internal control over financial reporting, which could adversely
    affect our stock price.
</DIV>

<A name='103'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">SPECIAL
    NOTE&#160;REGARDING FORWARD-LOOKING STATEMENTS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    This prospectus contains forward-looking statements within the
    meaning of Section&#160;27A of the Securities Act of 1933, as
    amended, or the Securities Act, and Section&#160;21E of the
    Securities Exchange Act of 1934, as amended, or the Exchange
    Act, that involve substantial risks and uncertainties. The
    forward-looking statements are contained principally in the
    sections entitled &#147;Prospectus Summary,&#148; &#147;Risk
    Factors,&#148; &#147;Management&#146;s Discussion and Analysis
    of Financial Condition and Results of Operations&#148; and
    &#147;Business,&#148; but are also contained elsewhere in this
    prospectus. In some cases, you can identify forward-looking
    statements by the words &#147;may,&#148; &#147;might,&#148;
    &#147;will,&#148; &#147;could,&#148; &#147;would,&#148;
    &#147;should,&#148; &#147;expect,&#148; &#147;intend,&#148;
    &#147;plan,&#148; &#147;objective,&#148; &#147;anticipate,&#148;
    &#147;believe,&#148; &#147;estimate,&#148; &#147;predict,&#148;
    &#147;project,&#148; &#147;potential,&#148; &#147;continue&#148;
    and &#147;ongoing,&#148; or the negative of these terms, or
    other comparable terminology intended to identify statements
    about the future. These statements involve known and unknown
    risks, uncertainties and other factors that may cause our actual
    results, levels of activity, performance or achievements to be
    materially different from the information expressed or implied
    by these forward-looking statements. Although we believe that we
    have a reasonable basis for each forward-looking statement
    contained in this prospectus, we caution you that these
    statements are based on a
</DIV>
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    <BR>
    22
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    combination of facts and factors currently known by us and our
    expectations of the future, about which we cannot be certain.
    Forward-looking statements include, but are not limited to,
    statements about:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    our anticipated cash needs and our estimates regarding our
    capital requirements and our needs for additional financing;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the progress, outcome, timing or success of preclinical studies
    and clinical trials;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the expected timing of clinical trials and availability of data
    from those trials;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    our ability to obtain and maintain regulatory approval for our
    product candidates from the FDA or foreign regulatory
    authorities;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    future demand for our product candidates and our ability to
    sustain such demand;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the size of the potential market for our product candidates;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    our plans to seek collaborative relationships and the success of
    those relationships;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the success of competing therapies that are or become available;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    our compliance with federal, state and foreign regulatory
    requirements, and regulatory developments that impact those
    requirements;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    our estimates and assumptions with respect to disease incidence;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    our intellectual property and our strategies regarding filing
    additional patent applications to attempt to strengthen our
    intellectual property rights;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    our ability to retain key management and scientific personnel;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    estimates of our future financial performance;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    our ability to implement financial controls and procedures on a
    timely basis;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    anticipated trends and challenges in our business.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In addition, you should refer to the &#147;Risk Factors&#148;
    section of this prospectus for a discussion of other important
    factors that may cause our actual results to differ materially
    from those expressed or implied by our forward-looking
    statements. As a result of these factors, we cannot assure you
    that the forward-looking statements in this prospectus will
    prove to be accurate or that we will achieve the plans,
    intentions or expectations expressed or implied in our
    forward-looking statements. Furthermore, if our forward-looking
    statements prove to be inaccurate, the inaccuracy may be
    material. In light of the significant uncertainties in these
    forward-looking statements, you should not regard these
    statements as a representation or warranty by us or any other
    person that we will achieve our objectives and plans in any
    specified time frame, or at all. Any forward-looking statements
    we make in this prospectus speak only as of its date, and we
    undertake no obligation to publicly update any forward-looking
    statements, whether as a result of new information, future
    events or otherwise, except as required by law.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    You should read this prospectus and the documents that we
    reference in this prospectus and have filed as exhibits to the
    registration statement, of which this prospectus is a part,
    completely and with the understanding that our actual future
    results may be materially different from what we expect. We
    qualify all of our forward-looking statements by these
    cautionary statements.
</DIV>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    23
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<A name='104'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">USE OF
    PROCEEDS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We estimate that the net proceeds from our issuance and sale
    of&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
    units in this offering will be approximately
    $&#160;&#160;&#160;&#160;&#160;&#160;million, or approximately
    $&#160;&#160;&#160;&#160;&#160;&#160;million if the underwriters
    exercise their over-allotment option in full, based upon the
    public offering price of $&#160;&#160;&#160;&#160;&#160; per
    unit, after deducting underwriting discounts and commissions,
    the corporate financing fee and estimated offering expenses
    payable by us.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We currently expect to use the net proceeds from this offering,
    and our existing cash and cash equivalents, to fund research and
    development activities, including our anticipated Phase 2
    clinical trial of RGN-352 in AMI patients, as well as the
    completion of our ongoing Phase 2 clinical trial of RGN-137 in
    patients with EB and our support of compassionate use studies
    using RGN-259 and a potential Phase 1/2 clinical trial of
    RGN-352 in patients with multiple sclerosis. We also expect to
    use a portion of the net proceeds for general corporate
    purposes, including working capital.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The expected use of net proceeds from this offering represents
    our intentions based upon our present plans and business
    conditions. Depending on the size of this offering, we may not
    be able to complete the contemplated Phase 2 clinical trial of
    RGN-352 without additional capital. Further, we expect that the
    net proceeds will not be sufficient to complete clinical trials
    to obtain regulatory approval for the marketing of any of our
    current product candidates. As described elsewhere in this
    prospectus, the completion of these trials may be delayed for a
    number of reasons. As of the date of this prospectus, we cannot
    predict with certainty all of the particular uses for the
    proceeds of this offering or the amounts that we will actually
    spend on the uses set forth above. The amount and timing of
    actual expenditures may vary significantly depending upon a
    number of factors, such as the progress of our development
    efforts, regulatory requirements, commercialization efforts in
    the event that we obtain regulatory approval, the amount of
    cash, if any, we generate from strategic collaborations that we
    may enter into or from other sources, and the amount of cash
    used by operations. Accordingly, we will have significant
    flexibility in applying the net proceeds of this offering.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Pending their use, we intend to invest the net proceeds of this
    offering in a variety of capital-preservation investments,
    including short- and intermediate-term, interest-bearing,
    investment-grade securities.
</DIV>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    24
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<A name='105'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">CAPITALIZATION</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table sets forth our cash and cash equivalents and
    our capitalization as of December&#160;31, 2009:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    on an actual basis;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    on an as adjusted basis to give effect to our sale
    of&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
    units in this offering at a public offering price of
    $&#160;&#160;&#160;&#160;&#160; per unit, after deducting
    underwriting discounts and commissions, the corporate financing
    fee and estimated offering expenses payable by us.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="79%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Actual</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>As Adjusted</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Cash and cash equivalents
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    4,356
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#160;&#160;&#160;&#160;&#160;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Stockholders&#146; equity:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Preferred stock, $0.001 per share, 1,000,000&#160;shares
    authorized, no shares issued or outstanding, actual or as
    adjusted
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Common stock, $0.001&#160;par value, 100,000,000&#160;shares
    authorized, 60,406,828&#160;shares issued and outstanding,
    actual;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    authorized,&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    issued and outstanding, as adjusted;
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    60
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Additional
    <FONT style="white-space: nowrap">paid-in-capital</FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    88,144
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Accumulated deficit
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (84,501
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Total stockholders&#146; equity
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,703
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 40pt">
    Total capitalization
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    3,703
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">

</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The number of shares of common stock outstanding in the table
    above does not include:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    4,914,112&#160;shares of our common stock issuable upon the
    exercise of stock options outstanding under our 2000 stock
    option plan as of December&#160;31, 2009, at a weighted average
    exercise price of $1.53 per share;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    1,550,888&#160;shares of our common stock available for future
    issuance under our 2000 stock option plan;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    7,933,851&#160;shares of our common stock issuable upon the
    exercise of outstanding warrants as of December&#160;31, 2009,
    at a weighted-average exercise price of $2.01 per share;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    shares issuable upon exercise of warrants to be issued in
    connection with this offering.
</TD>
</TR>

</TABLE>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    25
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<A name='106'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">PRICE
    RANGE OF COMMON STOCK AND DIVIDEND POLICY</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our common stock trades on the NYSE Amex, previously known as
    the American Stock Exchange, under the symbol &#147;RGN.&#148;
    The prices, as presented below, represent the highest and lowest
    bid or sale prices for our common stock by quarter as quoted on
    the NYSE Amex. On April&#160;15, 2010, the last sale price of
    our common stock as reported on the NYSE Amex was $0.57 per
    share.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="85%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>2008</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>High</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Low</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    First Quarter
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1.10
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    0.80
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Second Quarter
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1.92
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    0.83
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Third Quarter
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1.43
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1.02
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Fourth Quarter
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1.66
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    0.85
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="85%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>2009</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>High</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Low</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    First Quarter
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1.75
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    0.42
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Second Quarter
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    0.85
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    0.45
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Third Quarter
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1.12
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    0.52
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Fourth Quarter
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    0.83
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    0.55
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="85%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>2010</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>High</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Low</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    First Quarter
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    0.65
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    0.53
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Second Quarter (through April&#160;15, 2010)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    0.68
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    0.46
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As of April&#160;14, 2010, we had 851 holders of record of our
    common stock.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Each unit to be issued in this offering consists of shares of
    our common stock and a tradeable warrant to purchase additional
    shares of our common stock. The units will separate immediately
    and the common stock and the warrants will be issued separately.
    There will be no market for the units. Currently, no public
    market exists for the warrants. We intend to apply for listing
    of the warrants on the NYSE Amex, and we expect that the
    warrants will begin trading on or promptly after the date of
    this prospectus, subject to listing.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have never declared or paid any dividends on our common stock
    or any other securities. We anticipate that we will retain all
    of our future earnings, if any, for use in the operation of our
    business and do not anticipate paying cash dividends in the
    foreseeable future.
</DIV>

<A name='107'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">DILUTION</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If you invest in this offering, your interest will be diluted to
    the extent of the difference between the public offering price
    per share of our common stock, assuming no value is attributed
    to the warrants included in each unit, and the pro forma net
    tangible book value per share of our common stock immediately
    after this offering. Net tangible book value per share is
    determined by dividing our total tangible assets less total
    liabilities by the number of outstanding shares of our common
    stock. As of December&#160;31, 2009, we had a net tangible book
    value of $3.7&#160;million, or approximately $0.06 per share of
    common stock.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Investors participating in this offering will incur immediate
    and substantial dilution. After giving effect to the issuance
    and sale
    of&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
    units in this offering at a public offering price of
    $&#160;&#160;&#160;&#160;&#160; per unit, and after deducting
    underwriting discounts and commissions and estimated offering
    expenses payable by us, our pro forma net tangible book value as
    of December&#160;31, 2009 would have been approximately
    $&#160;&#160;&#160;&#160;&#160;&#160;million, or approximately
    $&#160;&#160;&#160;&#160;&#160; per share of common stock. This
    represents an immediate increase in the pro forma net tangible
    book value of $&#160;&#160;&#160;&#160;&#160; per share to
    existing stockholders, and an immediate dilution in the pro
    forma
</DIV>
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<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    26
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    net tangible book value of $&#160;&#160;&#160;&#160;&#160; per
    share to investors purchasing units in this offering. The
    following table illustrates this per share dilution:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="84%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Public offering price per share of common stock underlying each
    unit
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#160;&#160;&#160;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Actual net tangible book value per share as of December&#160;31,
    2009
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    0.06
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Increase in pro forma net tangible book value per share
    attributable to new investors participating in this offering
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Pro forma net tangible book value per share after this offering
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Dilution per share to investors participating in this offering
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If the underwriters exercise their option in full to
    purchase&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
    additional units in this offering, the pro forma net tangible
    book value per share after the offering would be
    $&#160;&#160;&#160;&#160;&#160; per share, the increase in the
    pro forma net tangible book value per share to existing
    stockholders would be $&#160;&#160;&#160;&#160;&#160; per share
    and the dilution to new investors purchasing units in this
    offering would be $&#160;&#160;&#160;&#160;&#160; per share.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The table above excludes:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    4,914,112&#160;shares of our common stock issuable upon the
    exercise of stock options outstanding under our 2000 stock
    option plan as of December&#160;31, 2009, at a weighted average
    exercise price of $1.53 per share;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    1,550,888&#160;shares of our common stock available for future
    issuance under our 2000 stock option plan;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    7,933,851&#160;shares of our common stock issuable upon the
    exercise of outstanding warrants as of December&#160;31, 2009,
    at a weighted-average exercise price of $2.01 per share;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    shares issuable upon exercise of warrants to be issued in
    connection with this offering.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    To the extent that options or warrants are exercised, new
    options are issued under our equity benefit plans, or we issue
    additional shares of common stock in the future, there will be
    further dilution to investors participating in this offering. In
    addition, we may choose to raise additional capital because of
    market conditions or strategic considerations, even if we
    believe that we have sufficient funds for our current or future
    operating plans. If we raise additional capital through the sale
    of equity or convertible debt securities, the issuance of these
    securities could result in further dilution to our stockholders.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    27
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<A name='108'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">SELECTED
    FINANCIAL DATA</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    You should read the following selected financial data together
    with &#147;Management&#146;s Discussion and Analysis of
    Financial Condition and Results of Operations&#148; and our
    financial statements and accompanying notes included later in
    this prospectus. The selected financial data in this section is
    not intended to replace our financial statements and the
    accompanying notes.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have derived the selected balance sheet data as of
    December&#160;31, 2009 and 2008 and the selected statement of
    operations data for the years ended December&#160;31, 2009 and
    2008 from our audited financial statements that are included in
    this prospectus. We have derived the selected balance sheet data
    as of December&#160;31, 2007, 2006 and 2005 and the selected
    statement of operations data for the years ended
    December&#160;31, 2007, 2006 and 2005 from our audited financial
    statements that are not included in this prospectus.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our historical results are not necessarily indicative of the
    results to be expected in any future period.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="35%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="9%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="9%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="9%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="9%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=06 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=lead -->
    <TD width="9%" align="right">&nbsp;</TD>	<!-- colindex=06 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=06 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="18" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Year Ended December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2007</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2006</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2005</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Statement of Operations Data:</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Sponsored research revenue
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    168,412
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    240,324
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    272,491
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Operating expenses:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Research and development
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,724,514
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7,149,808
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,887,255
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,396,524
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,155,735
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    General and administrative
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,781,790
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,805,346
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,197,685
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,665,652
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,513,792
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Total operating expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,506,304
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    10,955,154
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    12,084,940
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,062,176
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,669,527
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Loss from operations
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (6,506,304
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (10,786,742
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (11,844,616
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (8,789,685
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (5,669,527
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Interest income
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    12,444
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    149,777
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    666,458
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    522,704
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    214,676
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net loss
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (6,493,860
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (10,636,965
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (11,178,158
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (8,266,981
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (5,454,851
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Basic and diluted net loss per share
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (0.12
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (0.21
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (0.24
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (0.21
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (0.15
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Shares used to compute basic and diluted net loss per share
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    55,680,525
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    50,967,617
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    46,465,982
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    40,116,367
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    36,843,609
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="line-height: 12pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="18" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>As of December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2007</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2006</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2005</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Balance Sheet Data:</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Cash and cash equivalents
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    4,355,768
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    5,655,367
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    3,696,878
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    13,052,308
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    4,896,143
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Short-term investments
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,579,592
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,000,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,679,693
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Working capital
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,671,910
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,565,932
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,102,596
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    16,187,188
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,939,195
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Total assets
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,583,754
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,922,576
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,621,793
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    17,501,625
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7,724,634
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Total liabilities
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    880,404
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,325,912
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,469,069
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,249,290
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    714,127
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Accumulated deficit
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (84,501,404
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (78,007,544
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (67,405,579
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (56,227,421
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (47,960,440
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Stockholders&#146; equity
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,703,350
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,596,664
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,152,724
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    16,252,335
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7,010,507
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    28
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<A name='109'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">MANAGEMENT&#146;S
    DISCUSSION AND ANALYSIS OF<BR>
    FINANCIAL CONDITION AND RESULTS OF OPERATIONS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>You should read the following discussion and analysis of our
    financial condition and results of our operations together with
    our financial statements and the related notes to those
    statements included later in this prospectus. In addition to
    historical financial information, this discussion contains
    forward-looking statements reflecting our current plans,
    estimates, beliefs and expectations that involve risks and
    uncertainties. As a result of many important factors,
    particularly those set forth under &#147;Special Note Regarding
    Forward-Looking Statements&#148; and &#147;Risk Factors,&#148;
    our actual results and the timing of events may differ
    materially from those anticipated in these forward-looking
    statements.</I>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Overview</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We are a biopharmaceutical company focused on the development of
    a novel therapeutic peptide, Thymosin beta 4, or T&#223;4, for
    tissue and organ protection, repair, and regeneration. We have
    formulated T&#223;4 into three distinct product candidates
    currently in clinical development:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    RGN-352, an injectable product candidate to treat cardiovascular
    diseases, central nervous system diseases, and other medical
    indications that may be treated by systemic administration, for
    which we intend to initiate a Phase 2 clinical trial in the
    second half of 2010;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    RGN-259, a topical eye drop for ophthalmic indications that was
    evaluated in a small Phase 2 clinical trial and is currently
    being supported in compassionate use studies;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    RGN-137, a topically applied gel for chronic dermal wounds and
    reduction of scar tissue that is currently in a Phase 2 clinical
    trial for the treatment of the skin defect epidermolysis bullosa.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have a fourth product candidate, RGN-457, in preclinical
    development. RGN-457 is an inhaled formulation of T&#223;4
    targeting cystic fibrosis and other pulmonary diseases.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In addition to our four pharmaceutical product candidates, we
    are also pursuing the commercial development of peptide
    fragments and derivatives of T&#223;4 for cosmeceutical use. We
    believe the biological activities of these fragments may be
    useful, for example, in developing novel cosmeceutical products
    for the anti-aging market.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    During 2009, we completed a Phase 1 clinical trial evaluating
    the safety of RGN-352 in 60 healthy subjects. Based on the
    results of this Phase 1 trial and subject to available funding,
    we intend to initiate a Phase 2 clinical trial in the second
    half of 2010 to evaluate RGN-352&#146;s ability to salvage and
    regenerate damaged cardiac tissue and improve cardiac function
    after a heart attack. We intend to use a portion of the proceeds
    of this offering in support of this Phase 2 clinical trial,
    although depending on the size of this offering we may not be
    able to complete the trial without additional capital. We also
    intend to supply RGN-352 and may provide other assistance,
    depending on our available financial resources, in support of a
    Phase 1/2 clinical trial proposed to be conducted at a major
    U.S.&#160;medical center under a physician-sponsored IND in
    order to evaluate the potential of this product candidate in
    patients with multiple sclerosis.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We are continuing to support the development of RGN-259 in
    ophthalmic indications under compassionate use INDs. We are also
    planning to support a physician-sponsored clinical trial in
    patients with dry eye secondary to graft versus host disease, or
    GvHD, in order to gain further insight into RGN-259&#146;s
    ability to repair and regenerate ophthalmic tissues. Our support
    includes manufacturing and supplying RGN-259 for the trial and
    providing regulatory and clinical guidance. We are also
    collaborating with the U.S.&#160;military to evaluate the
    potential of RGN-259 to prevent or reduce eye damage caused by
    chemical warfare agents.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We are currently conducting a Phase 2 clinical trial evaluating
    RGN-137 for the treatment of patients with EB, which we expect
    to complete in late 2010 or early 2011. Once we complete our
    Phase 2 EB trial, we will analyze the data in conjunction with
    our two other completed Phase 2 trials, along with the
    preclinical data indicating T&#223;4&#146;s ability to reduce
    scarring, at which time we will further evaluate our strategy
    for the clinical development of RGN-137.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    29
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In addition to our four pharmaceutical product candidates, we
    are also pursuing the commercial development of peptide
    fragments and derivatives of T&#223;4 for potential
    cosmeceutical use. These fragments are amino acid sequences, and
    variations thereof, within the T&#223;4 molecule that have
    demonstrated activity in several <I>in&#160;vitro
    </I>preclinical research studies that we have sponsored. We
    believe the biological activities of these fragments may be
    useful, for example, in developing novel cosmeceutical products
    for the anti-aging market. Our strategy is to enter into a
    collaboration with other companies to develop cosmeceutical
    formulations based on these peptides.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As of the date of this prospectus, we believe we have sufficient
    liquidity and capital resources to fund our operations,
    including our ongoing clinical trials and other research
    initiatives, into the third quarter of 2010, without considering
    any proceeds from this offering. With the proceeds of this
    offering, we believe that we will be able to initiate and
    conduct at least a portion of our contemplated Phase 2&#160;AMI
    trial of RGN-352 as well as to complete our ongoing Phase 2
    trial of RGN-137 in EB patients and to support the compassionate
    use studies of RGN-259 and the proposed Phase 1/2 trial of
    RGN-352 in multiple sclerosis patients. However, we will need
    substantial additional funds beyond the proceeds of this
    offering in order to initiate and complete further clinical
    trials beyond those currently contemplated and to continue to
    fund our operations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We incurred net losses of $6.5&#160;million and
    $10.6&#160;million for the years ended December&#160;31, 2009
    and 2008, respectively. As of December&#160;31, 2009, we had an
    accumulated deficit of $84.5&#160;million. During 2009, we
    issued shares of common stock and warrants to purchase
    additional shares of our common stock to Sigma-Tau for gross
    proceeds of $1.6&#160;million. In October 2009, we also issued
    shares of common stock and warrants to purchase additional
    shares of our common stock to new institutional investors for
    gross proceeds of approximately $3.7&#160;million. From April to
    September 2009, we also reduced our ongoing monthly cash
    outflows through salary reductions and reductions in director
    fees in exchange for the issuance of stock options to our
    non-employee directors and certain of our executives and
    employees, which reduced our cash outflows by approximately
    $300,000 during this period. We restored salaries and directors
    fees to their prior levels in October 2009 and have continued
    our research efforts through the date of this prospectus. We
    intend to maintain tight cost controls and continue to operate
    under a closely monitored budget approved by the Board of
    Directors until sufficient funding is obtained to enable
    expanded research activities.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Financial
    Operations Overview</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Historically, we received only immaterial amounts of revenue
    from non-refundable government grants and may never receive
    future grants. We have never generated product revenues, and we
    do not expect to generate product revenues until the FDA
    approves one of our product candidates, if ever, and we begin
    marketing it. Subject to the availability of financing, we
    expect to invest increasingly significant amounts in the
    furtherance of our current clinical programs and may add
    additional preclinical studies and new clinical trials as we
    explore the potential of our current product candidates in other
    indications and explore new formulations of T&#223;4-based
    product candidates. As we expand our clinical development
    initiatives, we expect to incur substantial and increasing
    losses. Accordingly, we will need to generate significant
    product revenues in order to ultimately achieve and then
    maintain profitability. Also, we expect that we will need to
    raise substantial additional capital in addition to the proceeds
    of this offering in order to meet product development
    requirements. We cannot assure investors that such capital will
    be available when needed, on acceptable terms, or at all.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Most of our expenditures to date have been for research and
    development, or R&#038;D, activities and general and
    administrative, or G&#038;A, activities. R&#038;D costs include
    all of the wholly-allocable costs associated with our various
    clinical programs passed through to us by our outsourced
    vendors. Those costs include manufacturing T&#223;4 and peptide
    fragments, formulation of T&#223;4 into our product candidates,
    stability studies for both T&#223;4 and the various
    formulations, preclinical toxicology, safety and pharmacokinetic
    studies, clinical trial management, medical oversight,
    laboratory evaluations, statistical data analysis, regulatory
    compliance, quality assurance and other related activities.
    R&#038;D includes cash and non-cash compensation, employee
    benefits, travel and other miscellaneous costs of our internal
    R&#038;D personnel, seven persons in total, who are wholly
    dedicated either on a full or part-time basis to R&#038;D
    efforts. R&#038;D also includes a proration of our common
    infrastructure costs for office space and communications. We
    expense our R&#038;D costs as they are incurred.
</DIV>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    R&#038;D expenditures are subject to the risks and uncertainties
    associated with clinical trials and the FDA review and approval
    process. As a result, these expenses could exceed our
    expectations, possibly materially. We are uncertain as to what
    we will incur in future research and development costs for our
    clinical studies, as these amounts are subject to the outcome of
    current studies, management&#146;s continuing assessment of the
    economics of each individual research and development project
    and the internal competition for project funding.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    G&#038;A costs include outside professional fees for legal,
    audit and accounting services, including the costs to maintain
    our intellectual property portfolio. G&#038;A also includes cash
    and non-cash compensation, employee benefits, travel and other
    miscellaneous costs of our internal G&#038;A personnel, three in
    total, who are wholly dedicated to G&#038;A efforts. G&#038;A
    also includes a proration of our common infrastructure costs for
    office space, and communications.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Critical
    Accounting Policies</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We prepare our financial statements in conformity with
    accounting principles generally accepted in the United States.
    Such accounting principles require that our management make
    estimates and assumptions that affect the amounts reported in
    our financial statements and accompanying notes. Our actual
    results could differ materially from those estimates. The items
    in our financial statements that have required us to make
    significant estimates and judgments are as follows:
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Share-Based
    Payment</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We account for share-based compensation based on the estimated
    grant date fair value of the award using the Black-Scholes
    option-pricing model. The estimated grant date fair value is
    recognized over the requisite service period.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Determining the appropriate fair value model and calculating the
    fair value of share-based payment awards require the input of
    highly subjective assumptions, including the expected life of
    the share-based payment awards and stock price volatility. Since
    our historical data is limited, the expected life was determined
    in accordance with SEC Staff Accounting
    Bulletin&#160;No.&#160;107 guidance for &#147;plain
    vanilla&#148; options. Since our historical trading volume is
    relatively low, we estimated the expected volatility based on
    monthly closing prices for a period consistent with the expected
    life of the option.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The assumptions used in calculating the fair value of
    share-based payment awards represent management&#146;s best
    estimates, but these estimates involve inherent uncertainties
    and the application of management judgment. As a result, if
    factors change and we use different assumptions, our stock-based
    compensation expense could be materially different in the
    future. In addition, we are required to estimate the expected
    forfeiture rate and only recognize expense for those shares
    expected to vest. If our actual forfeiture rate is materially
    different from our estimate, the stock-based compensation
    expense could be significantly different from what we have
    recorded in the current period. See Note&#160;2 to our financial
    statements included in this prospectus for a further discussion
    on stock-based compensation and the relative ranges of our
    historical underlying assumptions.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Costs
    of Preclinical Studies and Clinical Trials</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We accrue estimated costs for preclinical studies and clinical
    trials conducted by contract research organizations and
    participating hospitals. These costs are a significant component
    of research and development expenses. We accrue costs for
    preclinical studies and clinical trials performed by contract
    research organizations based on estimates of work performed
    under the contracts. Costs of setting up hospital sites for
    participation in trials are accrued immediately. Hospital costs
    related to patient enrollment are accrued as patients are
    entered in the trial.
</DIV>
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    <B><I><FONT style="font-family: 'Times New Roman', Times">Recent
    Accounting Pronouncements</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In February 2010, the Financial Accounting Standards Board, or
    FASB, issued Accounting Standards Update (ASU 2010&#160;&#151;
    09)&#160;to address potential practice issues associated with
    FASB ASC&#160;855 (formerly SFAS&#160;165), &#147;Subsequent
    Events.&#148; The ASU was effective upon issuance and eliminated
    the requirement for entities that file or furnish financial
    statements with the SEC to disclose the date through which
    subsequent events have been evaluated in originally issued and
    reissued financial statements. Other entities would continue to
    be required to disclose the date through which subsequent events
    have been evaluated; however, disclosures about the date would
    be required only in financial statements revised because of an
    error correction or retrospective application of U.S.&#160;GAAP.
    Our adoption of this standard changed our presentation of
    subsequent events when preparing our financial statements.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In September 2009, the FASB ratified ASU
    <FONT style="white-space: nowrap">2009-13</FONT>
    (formerly
    <FONT style="white-space: nowrap">EITF&#160;08-1),</FONT>
    &#147;Revenue Recognition&#148; (ASC&#160;605):
    Multiple-Deliverable Revenue Arrangements, the final consensus
    reached by the Emerging Issues Task Force that revised the
    authoritative guidance for revenue arrangements with multiple
    deliverables. The guidance addresses how to determine whether an
    arrangement involving multiple deliverables contains more than
    one unit of accounting and how the arrangement consideration
    should be allocated among the separate units of accounting. The
    guidance will be effective for our fiscal year beginning
    January&#160;1, 2011 with early adoption permitted. The guidance
    may be applied retrospectively or prospectively for new or
    materially modified arrangements. We currently do not have any
    multiple-deliverable revenue arrangements, accordingly, the
    adoption of the guidance will not have an impact on our
    financial statements.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In August 2009, the FASB issued ASU
    <FONT style="white-space: nowrap">No.&#160;2009-05,</FONT>
    &#147;Fair Value Measurements and Disclosures
    (ASC&#160;820)&#160;&#151; Measuring Liabilities at Fair
    Value&#148; (ASU
    <FONT style="white-space: nowrap">2009-05).</FONT>
    ASU <FONT style="white-space: nowrap">2009-05</FONT>
    provides clarification that in circumstances in which a quoted
    price in an active market for the identical liability is not
    available, a reporting entity is required to measure fair value
    using a valuation technique that uses the quoted price of the
    identical liability when traded as an asset or the quoted prices
    for similar liabilities or similar liabilities when traded as
    assets. The guidance provided is effective for the first
    reporting period (including interim periods) beginning after
    issuance. Our adoption of ASU
    <FONT style="white-space: nowrap">2009-05</FONT> did
    not impact our financial position or results of operations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In June 2009, the FASB issued ASC&#160;105 (formerly
    SFAS&#160;168), &#147;The FASB Accounting Standards Codification
    and the Hierarchy of Generally Accepted Accounting
    Principles&#148; (ASC 105). ASC&#160;105 is now the source of
    authoritative U.S.&#160;GAAP recognized by the FASB to be
    applied by nongovernment entities. It also modifies the GAAP
    hierarchy to include only two levels of GAAP: authoritative and
    non-authoritative. ASC&#160;105 is effective for financial
    statements issued for interim and annual periods ending after
    September&#160;15, 2009. The adoption of this standard in 2009
    changed how we reference various elements of U.S.&#160;GAAP when
    preparing our financial statement disclosures, but did not have
    an impact on our financial position or results of operations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Other new pronouncements issued but not effective until after
    December&#160;31, 2009 are not expected to have a significant
    effect on our financial position or results of operations.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Results
    of Operations</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Comparison
    of years ended December&#160;31, 2009 and 2008</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><I>Revenues.</I></B>&#160;&#160;For the year ended
    December&#160;31, 2009, we did not recognize any grant revenue,
    as compared to approximately $168,000 for the year ended
    December&#160;31, 2008. Our grant from the NIH for the RGN-137
    trial for the treatment of EB was exhausted during the year
    ended December&#160;31, 2008, and we do not expect to receive
    any additional grant funding for this trial.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><I>Research and Development Expense.</I></B>&#160;&#160;For
    the year ended December&#160;31, 2009, our R&#038;D expenditures
    decreased by approximately $3.4&#160;million, or 48%, to
    approximately $3.7&#160;million, from approximately
    $7.1&#160;million in 2008. Our outsourced R&#038;D costs, which
    are costs paid directly to contract research organizations and
    outside consultants, decreased by approximately
    $2.9&#160;million, or 58%, to approximately $2.1&#160;million,
    from approximately $5.0&#160;million. This net decrease is
    directly related to the conclusion of several clinical trials in
    late 2008 and early 2009.
</DIV>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    For RGN-352, we completed the majority of work associated with a
    Phase 1 safety trial in 2008, including the initiation and
    completion of a Phase 1A portion followed by the initiation of
    the Phase 1B portion. During 2009, only a relatively minor
    portion of clinical activity on Phase 1B occurred for the
    remaining subjects in the study, along with that phase&#146;s
    data evaluation and wrap up. Consequently, our R&#038;D
    expenditures for RGN-352 decreased by approximately
    $1.2&#160;million, or 65%, to approximately $0.6&#160;million in
    2009, from approximately $1.8&#160;million in 2008.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    For RGN-259, during 2008, we were actively enrolling our Phase 2
    trial to treat diabetic patients whose corneal epithelium was
    scraped during vitrectomy surgery. In January 2009, we completed
    enrollment of the first cohort of our Phase 2 diabetic
    vitrectomy study and terminated the trial. Consequently, our
    R&#038;D expenditures for RGN-259 decreased by approximately
    $0.1&#160;million, or 15%, to approximately $0.8&#160;million in
    2009, from approximately $0.9&#160;million in 2008.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Throughout 2008, we were actively enrolling our Phase 2 trials
    of RGN-137 to treat patients with pressure ulcers as well as EB.
    Having completed enrollment of our Phase 2 pressure ulcer trial
    at the end of 2008, we incurred relatively less cost in early
    2009 to evaluate the trial&#146;s data and report the
    information, while our Phase 2 EB trial continued enrollment
    throughout both periods. Consequently, our R&#038;D expenditures
    for RGN-137 decreased by approximately $1.3&#160;million, or
    89%, to approximately $0.2&#160;million, from approximately
    $1.5&#160;million in 2008.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Some of our outsourced R&#038;D costs are for various
    miscellaneous development efforts or are for certain services
    that span several formulations or trials. These include certain
    stability, pharmacokinetic, and medical monitoring services.
    Given the overall decrease in clinical activity between years,
    these costs decreased by approximately $0.3&#160;million, or
    35%, to approximately $0.5&#160;million in 2009, from
    approximately $0.8&#160;million in 2008.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our internal R&#038;D costs decreased by approximately
    $0.5&#160;million, or 25%, to approximately $1.6&#160;million in
    2009, from approximately $2.1&#160;million in 2008. As described
    elsewhere in this prospectus, we implemented a salary reduction
    program for six months of 2009. Additionally, we reduced our
    R&#038;D headcount by one person during the year and some of our
    R&#038;D personnel only worked part-time during a portion of
    2009. Finally, as described in Note&#160;7 to our financial
    statements included in this prospectus, we increased our
    forfeiture assumption for stock options based on historical
    experience, which reduced the employee-related non-cash
    stock-based compensation expense associated with the grant of
    stock options. In combination, these variances yielded a
    decrease in our cost of employment for our R&#038;D personnel of
    approximately $0.4&#160;million, or 23%, to approximately
    $1.4&#160;million in 2009, from approximately $1.8&#160;million
    in 2008. Our other cost-cutting measures, as well as a reduction
    in travel associated with less clinical activity, resulted in a
    decrease in our other internal R&#038;D costs of approximately
    $0.1&#160;million, or 35%, to approximately $0.2&#160;million in
    2009, from approximately $0.3&#160;million in 2008.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><I>General and Administrative Expense.</I></B>&#160;&#160;For
    the year ended December&#160;31, 2009, our G&#038;A expenses
    decreased by approximately $1.0&#160;million, or 27%, to
    approximately $2.8&#160;million, from approximately
    $3.8&#160;million in 2008. The combination of our 2009 salary
    reduction program and reductions in stock-based compensation
    expense resulting from changes in forfeiture assumptions yielded
    a decrease in our G&#038;A personnel expenses of approximately
    $0.5&#160;million, or 32%, to approximately $0.9&#160;million in
    2009, from approximately $1.4&#160;million in 2008. We also
    reduced our outside accounting, legal and business development
    personnel costs by $0.5&#160;million, or 28%, to approximately
    $1.5&#160;million in 2009, from approximately $2.0&#160;million
    in 2008. Our other G&#038;A costs for facilities, investor
    relations, insurance, and travel remained consistent between
    years at approximately $0.4&#160;million.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><I>Interest Income.</I></B>&#160;&#160;For the year ended
    December&#160;31, 2009, our interest income decreased by
    $137,000, or 92%, to approximately $12,000, from approximately
    $150,000 in 2008. The decrease was due to lower average
    interest-bearing cash balances during 2009.
</DIV>
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    <B><FONT style="font-family: 'Times New Roman', Times">Liquidity
    and Capital Resources</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Overview</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have not commercialized any of our product candidates to date
    and have incurred significant losses since inception. We have
    primarily financed our operations through the issuance of common
    stock and common stock warrants in private and public
    financings. The report of our independent registered public
    accounting firm regarding our financial statements for the year
    ended December&#160;31, 2009 contains an explanatory paragraph
    regarding our ability to continue as a going concern based upon
    our history of net losses and dependence on future financing in
    order to meet our planned operating activities.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We had cash, cash equivalents and short-term investments
    totaling $4.4&#160;million and $5.7&#160;million at
    December&#160;31, 2009 and 2008, respectively. The
    $1.3&#160;million decrease during 2009 was the result of
    $6.2&#160;million used in operating activities, offset by
    $4.9&#160;million in cash raised through the private placement
    of common stock and warrants. As of the date of this prospectus,
    we have approximately $3.0&#160;million of cash and cash
    equivalents. Based on our current operations, we believe our
    existing cash resources, along with the expected net proceeds of
    this offering, will be adequate to fund our operations into the
    third quarter of 2011.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Accordingly, we will continue to have a need for financing,
    which we may not be able to complete either on favorable terms
    or at all. If we raise additional funds by selling shares of our
    common stock or securities convertible into our common stock,
    such as in this offering, the ownership interest of our existing
    stockholders may be significantly diluted. If additional funds
    are raised through the issuance of preferred stock or debt
    securities, these securities are likely to have rights,
    preferences and privileges senior to our common stock and may
    involve significant fees, interest expense, restrictive
    covenants or the granting of security interests in our assets.
    We are also in the process of exploring other alternatives,
    including corporate collaborations and licensing arrangements,
    and the sale of certain of our intellectual property rights.
    There are substantial challenges and risks that will make it
    difficult to successfully implement any of these opportunities.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Cash
    Flows</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><I>Net Cash Used in Operating
    Activities.</I></B>&#160;&#160;Net cash used in operating
    activities was approximately $6.2&#160;million and
    $10.6&#160;million for the years ended December&#160;31, 2009
    and 2008, respectively. While our reported net loss for the year
    ended December&#160;31, 2009 was approximately
    $6.5&#160;million, it included approximately $0.8&#160;million
    in non-cash expenses, primarily non-cash share-based
    compensation, which was offset by approximately
    $0.5&#160;million of cash used to retire current liabilities as
    compared to the liabilities reported as of December&#160;31,
    2008. Our net loss in 2008 of $10.6&#160;million approximated
    the net cash used in operating activities in the same period as
    the non-cash share based compensation expenses of approximately
    $1.1&#160;million were fully offset by a similar reduction in
    liabilities as compared to those reported as of
    December&#160;31, 2007.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><I>Net Cash Provided by Investing
    Activities.</I></B>&#160;&#160;Net cash provided by investing
    activities was approximately $4.6&#160;million for the year
    ended December&#160;31, 2008, and there were no investing
    activities during 2009. In 2008, we sold all of our short-term,
    highly-liquid, investment-grade financial instruments that had
    more than a
    <FONT style="white-space: nowrap">90-day</FONT>
    maturity from the date of purchase and invested the proceeds in
    cash equivalents.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><I>Net Cash Provided by Financing
    Activities.</I></B>&#160;&#160;Net cash provided by financing
    activities totaled approximately $4.9&#160;million and
    $7.9&#160;million for the years ended December&#160;31, 2009 and
    2008, respectively. In both periods, these net proceeds result
    from the issuance of common stock and warrants to purchase
    common stock.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Future
    Funding Requirements</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The expenditures that will be necessary to execute our business
    plan are subject to numerous uncertainties that may adversely
    affect our liquidity and capital resources. As described
    elsewhere in this prospectus, during 2009 we completed two Phase
    2 clinical trials, closed one additional Phase 2 clinical trial
    and completed a Phase 1 clinical trial. Currently, we are
    actively enrolling patients in only one Phase 2 trial, for
    RGN-137 in EB patients, although subject to available funding we
    intend to commence a Phase 2 clinical trial of RGN-352 for AMI
    patients in the second half of 2010 and support a Phase 1/2
    clinical trial of RGN-352 for MS patients,
</DIV>
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    <BR>
    34
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    as well as support of small compassionate use studies of
    RGN-259. We currently do not have sufficient capital resources
    to continue clinical development beyond the third quarter of
    2010, without giving effect to this offering.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In addition, the length of time required for clinical trials
    varies substantially according to the type, complexity, novelty
    and intended use of a product candidate. Some of the factors
    that could impact our liquidity and capital needs include, but
    are not limited to:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the progress of our clinical trials;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the progress of our research activities;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the number and scope of our research programs;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the progress of our preclinical development activities;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the costs involved in preparing, filing, prosecuting,
    maintaining, enforcing and defending patent and other
    intellectual property claims;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the costs related to development and manufacture of preclinical,
    clinical and validation lots for regulatory purposes and
    commercialization of drug supply associated with our product
    candidates;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    our ability to enter into corporate collaborations and the terms
    and success of these collaborations;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the costs and timing of regulatory approvals;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the costs of establishing manufacturing, sales and distribution
    capabilities.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In addition, the duration and the cost of clinical trials may
    vary significantly over the life of a project as a result of
    differences arising during the clinical trial protocol,
    including, among others, the following:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the number of patients that ultimately participate in the trial;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the duration of patient
    <FONT style="white-space: nowrap">follow-up</FONT>
    that seems appropriate in view of the results;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the number of clinical sites included in the trials;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the length of time required to enroll suitable patient subjects.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Also, we test our potential product candidates in numerous
    preclinical studies to identify indications for which they may
    be product candidates. We may conduct multiple clinical trials
    to cover a variety of indications for each product candidate. As
    we obtain results from trials, we may elect to discontinue
    clinical trials for certain product candidates or for certain
    indications in order to focus our resources on more promising
    product candidates or indications.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our proprietary product candidates also have not yet achieved
    FDA regulatory approval, which is required before we can market
    them as therapeutic products. In order to proceed to subsequent
    clinical trial stages and to ultimately achieve regulatory
    approval, the FDA must conclude that our clinical data establish
    safety and efficacy. Historically, the results from preclinical
    studies and early clinical trials have often not been predictive
    of results obtained in later clinical trials. A number of new
    drugs and biologics have shown promising results in clinical
    trials, but subsequently failed to establish sufficient safety
    and efficacy data to obtain necessary regulatory approvals.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In addition to our obligations under clinical trials, we are
    committed under an office space lease through January 2013 that
    requires average base rental payments of approximately $7,300
    per month.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Sources
    of Liquidity</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Sigma-Tau has historically provided significant equity capital
    to us. In 2009, Sigma-Tau provided approximately
    $1.6&#160;million in gross proceeds out of the approximately
    $5.3&#160;million in total gross proceeds raised during the
    year, with new investors providing the remaining
    $3.7&#160;million. Sigma-Tau provided all of the
    $8.0&#160;million in gross proceeds raised during 2008.
</DIV>
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    35
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As described below under &#147;Business&#160;&#151; Material
    Agreements,&#148; we are party to a license agreement with a
    subsidiary of Sigma-Tau that provides the opportunity for us to
    receive milestone payments upon specified events and royalty
    payments upon commercial sales of T&#223;4 in Europe. However,
    we have not received any milestone payments to date, and there
    can be no assurance that we will be able to attain such
    milestones and generate any such payments under the agreement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Potential sources of outside capital include entering into
    strategic business relationships, public or private sales of
    shares of our capital stock, or debt, or other similar financial
    instruments. While we sold common stock and warrants to purchase
    common stock to Sigma-Tau and new investors in the fourth
    quarter of 2009, we do not have any committed sources of outside
    capital at this time. Consequently, there can be no assurance
    that we will be able to obtain additional capital in sufficient
    amounts, on acceptable terms, or at all.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If we raise additional capital through such a strategic business
    relationship, we may have to give up valuable rights to
    intellectual property. If we raise funds by selling additional
    shares of our common stock or securities convertible into our
    common stock, such as in this offering, the ownership interest
    of our existing stockholders may be significantly diluted. In
    addition, if additional funds are raised through the issuance of
    preferred stock or debt securities, these securities are likely
    to have rights, preferences and privileges senior to our common
    stock and may involve significant fees, interest expense,
    restrictive covenants and the granting of security interests in
    our assets.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our failure to successfully address ongoing liquidity
    requirements would have a materially negative impact on our
    business, including the possibility of surrendering our rights
    to some technologies or product opportunities, delaying our
    clinical trials, or ceasing operations.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Off
    Balance Sheet Arrangements</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We do not have any off-balance sheet arrangements, as such term
    is defined in Item&#160;303(a)(4) of
    <FONT style="white-space: nowrap">Regulation&#160;S-K.</FONT>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Quantitative
    and Qualitative Disclosures about Market Risk</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our cash equivalents, which are generally comprised of
    Federally-insured bank deposits and short-term
    U.S.&#160;government debt securities, are subject to default,
    changes in credit rating and changes in market value. These
    investments are also subject to interest rate risk and will
    decrease in value if market interest rates increase. As of
    December&#160;31, 2009, these cash equivalents and short-term
    investments were $4.4&#160;million. Due to the short-term nature
    of these investments, if market interest rates differed by 10%
    from their levels as of December&#160;31, 2009, the change in
    fair value of our financial instruments would not have been
    material.
</DIV>
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    <BR>
    36
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<A name='110'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">BUSINESS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">General</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We are a biopharmaceutical company focused on the development of
    a novel therapeutic peptide, T&#223;4, for tissue and organ
    protection, repair, and regeneration. We have formulated
    T&#223;4 into three distinct product candidates currently in
    clinical development:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    RGN-352, an injectable product candidate to treat cardiovascular
    diseases, central nervous system diseases, and other medical
    indications that may be treated by systemic administration, for
    which we intend to initiate a Phase 2 clinical trial in the
    second half of 2010;
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    RGN-259, a topical eye drop for ophthalmic indications that was
    evaluated in a small Phase&#160;2 clinical trial and is
    currently being supported in compassionate use studies;&#160;and
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    RGN-137, a topically applied gel for chronic dermal wounds and
    reduction of scar tissue that is currently in a Phase 2 clinical
    trial for the treatment of the skin defect epidermolysis
    bullosa, or EB.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have a fourth product candidate, RGN-457, in preclinical
    development. RGN-457 is an inhaled formulation of T&#223;4
    targeting cystic fibrosis and other pulmonary diseases.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In addition to our four pharmaceutical product candidates, we
    are also pursuing the commercial development of peptide
    fragments and derivatives of T&#223;4 for cosmeceutical use.
    Cosmeceuticals are cosmetic products with biologically active
    ingredients. We believe the biological activities of these
    fragments may be useful, for example, in developing novel
    cosmeceutical products for the anti-aging market.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Overview
    of T&#223;4</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    T&#223;4 is a naturally occurring
    <FONT style="white-space: nowrap">43-amino</FONT>
    acid peptide that was originally isolated from bovine thymus
    glands. It plays a vital role in cell structure and motility and
    in the protection, regeneration, remodeling and healing of
    tissues.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Although it is recognized that wound healing is a complex
    process, most companies working to develop new drugs in this
    area have focused primarily on the development of growth factors
    to stimulate healing and have, to date, failed to demonstrate
    dramatic improvements in the healing process. Unlike growth
    factors, numerous preclinical animal studies, published by
    independent researchers, have identified several important
    biological activities involving T&#223;4 that we believe make it
    potentially useful as wound healing, repair and tissue
    regenerating agent. These activities include:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <B><I>Progenitor (Stem) Cell
    Differentiation.</I></B>&#160;&#160;Research published in the
    journal <I>Nature</I> in November 2006 featured the discovery
    that T&#223;4 is the key signaling molecule that triggers adult
    epicardial progenitor cells, or EPCs, to differentiate into
    coronary blood vessels. EPCs are partially differentiated stem
    cells that can further differentiate into specific cell types
    when needed. Confirmatory research published in 2009 in the
    <I>Journal of Molecular and Cellular Cardiology</I> concluded
    that T&#223;4 is responsible for the initiation of the embryonic
    coronary developmental program and EPC differentiation in adult
    mice. These publications confirm that T&#223;4&#146;s
    interaction with EPCs is necessary for the maintenance of a
    healthy adult animal heart, as well as normal fetal animal heart
    development.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 1%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The 2006 <I>Nature</I> publication also concluded that
    T&#223;4&#146;s interaction with EPCs resulted in the formation
    of cardiomyocytes that repaired damaged myocardium, or heart
    tissue, in mice after an induced AMI. Research published in the
    journal <I>Circulation </I>in April 2008 showed T&#223;4&#146;s
    cardioprotective effects in a pig ischemic-reperfusion model.
    This pig model is accepted as an important model upon which to
    base human clinical research, as pigs are larger mammals, the
    anatomy of the pig heart is similar to the human heart, and
    vascular response processes are completed five to six times
    faster in pigs than in humans, so that long-term results can be
    obtained in a relatively short period of time. This research
    also identified T&#223;4&#146;s interaction with EPCs as the
    underlying basis of cardioprotection through the differentiation
    of EPCs into cardiomyocytes, yielding statistically significant
    cardiac functional recovery results when compared to the
    administration of placebo.
</DIV>
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<DIV align="left" style="margin-left: 1%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Similar research in the area of brain tissue was published in
    the journal <I>Neuroscience</I> in September 2009. This
    publication concluded that T&#223;4 triggered the
    differentiation of oligodendrocyte progenitor cells to form
    myelin-producing oligodendrocytes, which led to the
    remyelination of axons in the brain of mice with experimental
    autoimmune encephalomyelitis, or EAE. This mouse model is an
    accepted small animal model for the study of multiple sclerosis.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <B><I>Actin Regulation.</I></B>&#160;&#160;T&#223;4 regulates
    actin, which comprises up to 10% of the protein of non-muscle
    cells in the body and plays a central role in cell structure and
    in the movement of cells. Research studies have indicated that
    T&#223;4 stimulates the migration of human keratinocytes, or
    skin cells, human endothelial cells, and progenitor cells.
    Endothelial cells are the major cell type responsible for the
    formation of new blood vessels, a process known as angiogenesis.
    Certain of these studies conducted at the NIH were the first to
    suggest the role of T&#223;4 in wound healing. The data from
    these studies encouraged us to license the rights to T&#223;4
    from the NIH in 2001 and to launch an initial clinical
    development program that targeted the use T&#223;4 for chronic
    dermal wounds.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <B><I>Reduction of Inflammation.</I></B>&#160;&#160;Uncontrolled
    inflammation is the underlying basis of many pathologies and
    injuries. Research has shown that T&#223;4 is a potent
    anti-inflammatory agent in skin cells and in corneal epithelial
    cells in the eye. T&#223;4 has also been shown to decrease the
    levels of inflammatory mediators and to significantly reduce the
    influx of inflammatory cells in the reperfused heart of animals.
    More recent preclinical research suggests that T&#223;4 blocks
    activation of the NF&#954;B pathway, which is involved in DNA
    activation of inflammatory mediators, thereby modulating
    inflammation in the body. This anti-inflammatory activity may
    explain, in part, the mechanism by which T&#223;4 appeared to
    improve functional outcome in the mouse multiple sclerosis model
    described above, as well as promoting repair in the heart and
    skin. Identifying a factor such as T&#223;4 that blocks
    activation of NF&#954;B suggests that T&#223;4 could have
    additional important therapeutic applications for
    inflammation-related diseases, such as cancer, osteoarthritis,
    rheumatic diseases, autoimmune diseases, inflammatory pulmonary
    disease and pancreatitis.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <B><I>Collagen and Laminin-5
    Stimulation.</I></B>&#160;&#160;T&#223;4 has a number of
    additional biological activities shown to reduce inflammation,
    stimulate the formation of collagen, and up-regulate the
    expression of laminin-5, a subepithelial basement membrane
    protein. Both collagen and laminin-5 are central to healthy
    tissue and the prevention of disease.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <B><I>Apoptosis.</I></B>&#160;&#160;T&#223;4 has been shown to
    prevent apoptosis, or programmed cell death, in two animal
    models and in two tissue types. In the rodent model, corneal
    apoptosis, or loss of corneal epithelial cells leading to
    corneal epithelial thinning, was prevented through topical
    administration of T&#223;4, and in the heart muscle of ischemic
    animal models, such as in mice and pigs, cell death was
    prevented by the systemic administration of T&#223;4.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In combination, we believe that these various biological
    activities work together to play a vital role in the healing and
    repair of injured or damaged tissue and suggest that T&#223;4 is
    an essential component of the tissue protection and regeneration
    process that may lead to many potential medical applications.
    All of our product candidates are based on T&#223;4,
    manufactured as a synthetic copy of the naturally occurring
    peptide and formulated for various routes of administration and
    applications.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Our
    Product Candidates</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">RGN-352</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our product candidate RGN-352 is an injectable formulation of
    T&#223;4 for systemic administration. We have initially targeted
    RGN-352 for patients who have suffered an acute myocardial
    infarction, or AMI, commonly known as a heart attack.
    Preclinical research published in the scientific journal
    <I>Nature </I>has indicated that T&#223;4 can guide specific
    types of stem cells from the outer layer of the heart to
    generate new myocardial blood vessels and tissue at injured
    sites.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><I>Clinical Development.</I></B>&#160;&#160;In 2009, we
    completed a Phase 1 clinical trial evaluating the safety,
    tolerability and the pharmacokinetics of the intravenous
    administration of RGN-352. We also designed this trial to
    explore the use of RGN-352 in other indications in which acute
    administration of T&#223;4 may be warranted. We conducted the
    Phase
</DIV>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    1 trial in two consecutive parts, referred to as Phase 1A and
    Phase 1B, both of which were double-blind, placebo-controlled,
    and dose-escalating over four doses. We enrolled a total of 60
    healthy subjects in the trial, consisting of 40 subjects in each
    phase, of which 20 subjects participated in both phases. In
    Phase 1A, we evaluated a single administration of RGN-352, and
    in Phase 1B we evaluated once daily administration for
    14&#160;consecutive days.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In September 2008, we reported the results of Phase 1A. The
    single intravenous injection of RGN-352 was well-tolerated at
    all four dose levels. In December 2009, we reported the results
    of Phase 1B. A daily intravenous injection of RGN-352 for 14
    consecutive days was also observed to be well-tolerated at all
    four dose levels. There were no reported dose-limiting adverse
    events in either Phase 1A or Phase 1B.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><I>Future Plans.</I></B>&#160;&#160;Based on the results of
    the Phase 1 trial, and subject to available funding, we intend
    to initiate a Phase 2 clinical trial in the second half of 2010
    to evaluate RGN-352 in patients who have suffered an AMI. We are
    currently designing this trial to observe RGN-352&#146;s
    cardioprotective effects and its ability to salvage and
    regenerate damaged cardiac tissue and improve cardiac function
    after a heart attack. We intend to use a portion of the proceeds
    of this offering to initiate and conduct at least a portion of
    this Phase 2 clinical trial, although depending on the size of
    this offering we may not be able to complete the trial without
    additional capital. We expect that the Phase 2 trial design will
    allow for an interim review of patient data from an initial
    group of evaluated patients, and we currently expect that the
    proceeds of this offering will be sufficient to reach this point
    in the trial. Depending on our capital resources, we may conduct
    the trial while continuing strategic partnership discussions
    with biotechnology and pharmaceutical companies for the further
    clinical development of RGN-352.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Recent preclinical research published in the scientific journal
    <I>Neuroscience </I>also indicates that RGN-352 may prove useful
    for patients with multiple sclerosis, or MS, and stroke. In
    research involving mice, the administration of T&#223;4 resulted
    in statistically significant improvement in neurological
    functional recovery. Based on this research, we intend to
    support a proposed Phase 1/2 clinical trial to be conducted at a
    major U.S.&#160;medical center under a physician-sponsored IND
    in order to evaluate the therapeutic potential of RGN-352 in
    patients with MS. We are planning to supply RGN-352 and provide
    clinical and regulatory guidance for the trial. We believe that
    we can support this trial from our existing capital resources,
    although we intend to use a portion of the proceeds from this
    offering to provide additional support.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">RGN-259</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our product candidate RGN-259 is a sterile topical eye drop
    formulation of T&#223;4 for ophthalmic indications.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><I>Clinical Development. </I></B>&#160;&#160;Emerging human
    clinical data from two compassionate use studies have
    demonstrated the ability of RGN-259 to repair and regenerate
    corneal tissue. A corneal specialist has received approval from
    the FDA to treat up to ten patients with neurotrophic keratitis,
    or NK, with RGN-259. NK is a rare degenerative corneal disease
    induced by a nerve impairment. The most common causes of NK
    include the herpes zoster virus. To date, nine patients have
    been treated in an open label protocol for periods of 28 or
    49&#160;days. The NK patients being evaluated have non-healing
    defects that have lasted at least six weeks and up to greater
    than ten years.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Patients in the study were divided into two groups. The first
    group consisted of six patients with a single non-healing
    measurable eye ulcer. The second group consisted of three
    patients with diffuse punctate erosions, a corneal defect that
    appears as numerous small pinhole-sized lesions. All six
    patients with single lesions showed clinically significant
    improvement during the treatment with RGN-259 and the
    <FONT style="white-space: nowrap">follow-up</FONT>
    period, with four of the six patients healing completely. The
    completely healed ulcers remained healed during the
    <FONT style="white-space: nowrap">follow-up</FONT>
    period, and those that had demonstrated significant improvement
    continued to improve after completion of treatment with RGN-259.
    The three patients with diffuse punctate erosions demonstrated
    no significant improvement, although they did report reduced
    ocular irritation.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In all nine patients treated, RGN-259 has been well-tolerated,
    and there have been no drug-related adverse events. A tenth
    patient with a single lesion has recently been enrolled in the
    study, and we expect to report final results of the
    compassionate use study later in 2010. Based on the preliminary
    findings, we believe that RGN-259 may provide a novel approach
    to the treatment of patients with non-healing neurotrophic
    corneal ulcers.
</DIV>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We had previously initiated a Phase 2 clinical trial to evaluate
    RGN-259 in diabetic patients undergoing corneal epithelial
    debridement, or removal of the outer transparent tissue layer of
    the front part of the eye, during vitrectomy surgery. In this
    randomized, double-blind, placebo-controlled, dose-response
    trial conducted at U.S.&#160;clinical sites, we originally
    intended to evaluate the safety, tolerability, and healing
    efficacy of three different concentrations of RGN-259 compared
    to placebo, applied as eye drops, four times daily for up to
    14&#160;consecutive days.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    While we did not view this particular ophthalmic indication as a
    significant commercial opportunity, we believed that it
    represented a
    <FONT style="white-space: nowrap">&#147;proof-of-concept&#148;</FONT>
    clinical model to evaluate the safety and efficacy of
    <FONT style="white-space: nowrap">RGN-259</FONT> for
    the treatment of corneal indications. We intended to obtain
    initial data that could be used to address other ophthalmic
    indications with larger market potential. Patient enrollment in
    the trial was significantly slower than anticipated due to newer
    surgical techniques and equipment that reduced the need for
    corneal epithelial debridement required for the trial. We closed
    the trial in January 2009, after completion of the first cohort
    of 12&#160;patients, in order to focus our research on other
    commercial opportunities. The encouraging compassionate use data
    described above, which we received during the course of the
    trial, also influenced our decision to close the trial earlier
    than originally intended.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In the 12&#160;patients evaluated in the trial, there were no
    reported drug-related adverse events associated with RGN-259. We
    observed increased corneal epithelial thickening and reduced
    cell and flare inflammation in the patients treated with RGN-259
    as compared to patients receiving placebo, which we believe to
    be indicative of corneal re-epithelialization and healing. None
    of the results from the trial are considered to be statistically
    significant. We expect to report final results later in 2010
    following the submission of the clinical study report to the FDA.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><I>Future Plans.</I></B>&#160;&#160;We are continuing to
    support the evaluation of RGN-259 in NK patients under a
    compassionate use IND and expect to report final patient data
    from these trials in the third quarter of 2010. We are also
    planning to support a physician-sponsored clinical trial in
    patients with dry eye secondary to GvHD in order to gain further
    insight into RGN-259&#146;s ability to repair and regenerate
    ophthalmic tissues. Our support includes manufacturing and
    supplying RGN-259 for the trial and providing regulatory and
    clinical guidance. We are continuing to collaborate with the
    U.S.&#160;military to evaluate the potential of RGN-259 to
    prevent or reduce eye damage caused by chemical warfare agents.
    We are also engaged in discussions with potential partners
    regarding the clinical development of this product candidate.
    Once enough human data is generated, we intend to seek strategic
    partnerships with one or more ophthalmic specialty companies.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">RGN-137</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our product candidate RGN-137 is a topical gel formulation of
    T&#223;4 intended to promote dermal wound healing and tissue
    regeneration. Preclinical research has demonstrated that
    T&#223;4 can accelerate dermal regeneration after a wound, while
    more recent research indicates that T&#223;4 can reduce scarring
    after injury in the skin and heart. Based on research conducted
    at the NIH, we initiated a series of Phase 2 clinical trials to
    evaluate RGN-137 for the treatment of three different types of
    skin wounds.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><I>Clinical Development&#160;&#151; Epidermolysis
    Bullosa.</I></B>&#160;&#160;In 2005, we began enrolling patients
    in a Phase 2 trial designed to assess the safety and
    effectiveness of RGN-137 for the treatment of patients with EB.
    EB is a genetic defect that results in fragile skin and other
    epidermal tissues that can blister at the slightest trauma or
    friction, creating a wound that at times does not heal or heals
    poorly. In this randomized, double-blind, placebo-controlled,
    dose-response trial, nine U.S.&#160;clinical sites are enrolling
    a total of 36&#160;patients to evaluate the safety,
    tolerability, and wound healing effectiveness of three different
    concentrations of RGN-137 compared to placebo. RGN-137 is being
    applied topically to the skin, once daily for up to 56
    consecutive days.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    EB has been designated as an &#147;orphan&#148; indication by
    the FDA. We estimate the prevalence of EB in the United States
    to be between 20,000 and 30,000&#160;patients, with a
    subpopulation of approximately 5,000&#160;patients in the group
    eligible for inclusion in our Phase 2 clinical trial. We
    received a grant of $681,000 from the FDA&#146;s Office of
    Orphan Products Development to partially fund this trial. While
    enrollment has been difficult due to the small addressable
    patient population, we currently expect to complete this trial
    by late 2010 or early 2011.
</DIV>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><I>Clinical Development&#160;&#151; Pressure
    Ulcers.</I></B>&#160;&#160;In late 2005, we began enrolling
    patients in a Phase 2 clinical trial designed to assess the
    safety and effectiveness of RGN-137 for the treatment of
    patients with chronic pressure ulcers, commonly known as
    bedsores. In this randomized, double-blind, placebo-controlled,
    dose-response trial, 15 clinical sites in the United States
    enrolled a total of 72&#160;patients to evaluate the safety,
    tolerability, and wound healing effectiveness of three different
    concentrations of RGN-137 compared to placebo. RGN-137 was
    applied topically to the ulcers, once daily for up to 84
    consecutive days. Patients in the trial were between 19 and
    85&#160;years old and had at least one stable Stage&#160;III
    or&#160;IV pressure ulcer with a surface area between 5 and
    70&#160;cm<SUP style="font-size: 85%; vertical-align: top">2</SUP>.

    Stage&#160;III and&#160;IV pressure ulcers are full thickness
    wounds that penetrate through the skin and muscle, sometimes
    completely to the bone.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In January 2009, we reported final data from this trial. RGN-137
    was well-tolerated at all three dose levels studied, with no
    dose-limiting adverse events, which achieved the primary
    objective of the study. As for efficacy, all T&#223;4 doses
    performed similarly compared to placebo, with no statistically
    significant efficacy results. Patients treated with the middle
    dose showed a 17% rate of wound healing, which was the highest
    rate among the three active doses evaluated. The improvement in
    ulcer healing in this middle dose group following nine weeks of
    treatment was equal to the improvement in patients treated with
    placebo after 12&#160;weeks of treatment.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><I>Clinical Development&#160;&#151; Venous Stasis
    Ulcers.</I></B>&#160;&#160;In 2006, we began enrolling patients
    in a Phase 2 trial designed to assess the safety and
    effectiveness of RGN-137 for the treatment of patients with
    venous stasis ulcers. In this randomized, double-blind
    dose-response trial, eight clinical sites in Italy and Poland
    enrolled a total of 73&#160;patients to evaluate the safety,
    tolerability, and wound healing effectiveness of three different
    concentrations of RGN-137 compared to placebo. RGN-137 was
    applied topically to the ulcers, once daily for up to 84
    consecutive days. Patients in the trial were between 18 to
    79&#160;years old and had at least one venous stasis ulcer with
    a surface area between 3 and 30
    cm<SUP style="font-size: 85%; vertical-align: top">2</SUP>. We

    were the sponsor of the trial, and it was conducted and funded
    by Sigma-Tau.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In March 2009, we reported final data from the trial. RGN-137
    was well-tolerated at all three dose levels, with no
    dose-limiting adverse events, which achieved the primary
    objective of the study. Thirty-three percent (33%) of the
    patients who received the middle dose of RGN-137 had their
    ulcers heal completely after the 12&#160;weeks of treatment,
    compared to 24% of patients receiving the placebo, 16% of the
    patients receiving the lowest drug dose and 17% of patients
    receiving the highest drug dose. Of the patients receiving the
    middle dose whose ulcers healed completely, the median time to
    complete healing decreased by approximately 45%, as compared to
    a 37% decrease in the time to healing for patients in the
    placebo-treated group. None of the differences observed between
    RGN-137 and placebo were statistically significant.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><I>Future Plans.</I></B>&#160;&#160;Once we complete our
    Phase 2 EB trial and evaluate the results, we will evaluate its
    potential value for acceleration of dermal wound healing and
    whether to continue clinical development of this product
    candidate. We believe that preclinical research indicating the
    ability of T&#223;4 to reduce scarring in rats, complimented by
    reduced scarring in the hearts of mice and pigs after an induced
    heart attack, may also be relevant in suggesting that T&#223;4
    may be effective in reducing dermal scar tissue. Subject to
    available funding, we plan to continue research and development
    of RGN-137 for this potential application.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">RGN-457</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our preclinical product candidate RGN-457 is based on T&#223;4
    formulated as an inhaled therapeutic agent. We have completed a
    substantial amount of preclinical work necessary for an IND
    application, and we are currently seeking a strategic partner to
    assist in the development of RGN-457 for the treatment of cystic
    fibrosis, or CF. CF is a life-threatening, hereditary disease
    that impairs the patient&#146;s ability to breathe due to the
    accumulation of mucus secretions in the airways of the lungs.
    The predicted median age of survival for patients with cystic
    fibrosis is 37&#160;years. There are estimated to be
    approximately 30,000 CF patients in the United States and
    approximately 40,000 CF patients in Europe. It is therefore
    considered to be an orphan disease in both territories. While we
    believe RGN-457 may prove beneficial in the treatment of CF, we
    remain focused primarily on development of our other product
    candidates while we continue strategic partnership discussions
    with respect to RGN-457.
</DIV>
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    <B><I><FONT style="font-family: 'Times New Roman', Times">Peptide
    Fragments for Cosmeceutical Applications</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We are also seeking to identify and evaluate T&#223;4 peptide
    fragments and derivatives that may be useful as novel components
    in cosmeceutical and consumer products. We have identified
    several amino acid sequences, and variations thereof, within the
    T&#223;4 molecule that have demonstrated <I>in&#160;vitro</I>
    activity in preclinical research studies that we have sponsored,
    and we have filed a number of patent applications related to
    this research. We believe the biological activities of these
    fragments may be useful, for example, in developing novel
    cosmeceutical products for the anti-aging market. To date,
    research has suggested that these fragments suppress
    inflammation, accelerate the deposition of certain types of
    collagen, promote the production of elastin, and inhibit
    programmed cell death, among other activities. Our development
    and commercialization strategy is to identify suitable
    commercial partners to license these novel fragments for various
    cosmeceutical applications. We are currently holding discussions
    with several multinational cosmetics and consumer products
    companies for potential collaborations to further develop and
    commercialize these fragments.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Our
    Strategy</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We seek to maximize the value of our product candidates by
    advancing their clinical development and then identifying
    suitable partners for further development, regulatory approval,
    and marketing. We intend to engage in strategic partnerships
    with companies with clinical development and commercialization
    strengths in desired pharmaceutical therapeutic fields. We are
    actively seeking partners with suitable infrastructure,
    expertise and a long-term initiative in our medical fields of
    interest.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    For example, in 2004, we entered into a strategic partnership
    with Defiante Farmaceutica S.A., a subsidiary of Sigma-Tau, for
    development and marketing of RGN-137 and RGN-352 for specified
    indications in Europe and other contiguous countries. Sigma-Tau
    also funded and co-managed our Phase 2 clinical trial of RGN-137
    in Europe for the treatment of venous stasis ulcers.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Manufacturing</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We use a contract manufacturer to produce bulk T&#223;4 by an
    established and proven manufacturing process known as
    solid-phase peptide synthesis, and we are in the early stages of
    qualifying backup manufacturers. While we do not currently have
    long-term supply agreements in place, we intend to establish a
    long-term supply arrangement with at least one manufacturer once
    practicable. No assurance can be given, however, that such
    agreements will be negotiated on favorable terms, or at all.
    Contractors are selected on the basis of their supply
    capability, ability to produce a drug substance in accordance
    with current Good Manufacturing Practice requirements of the
    FDA, and ability to meet our established specifications.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We also use a number of outside contract manufacturers to
    formulate bulk T&#223;4 into our product candidates. All of
    these formulations may require modifications along with
    additional studies as we move through our clinical development
    programs.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Competition</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We are engaged in a business that is highly competitive, and our
    target medical indications are ones with significant unmet
    needs. Moreover, the cosmetic and cosmeceutical industries are
    rapidly developing new products based on new scientific
    research. Consequently, there are many enterprises, both
    domestic and foreign, pursuing therapies and products that could
    compete with ours. Most of these entities have financial and
    human resources that are substantially greater than ours,
    specifically with regard to the conduct of clinical research and
    development activities, clinical testing and in obtaining the
    regulatory approvals necessary to market pharmaceutical
    products. Brief descriptions of some of these competitive
    products follow:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <B><I>RGN-352.</I></B>&#160;&#160;Currently, there are no
    approved pharmaceutical products for regenerating cardiac tissue
    following a heart attack, nor are there approved pharmaceutical
    products for the remyelination of axons for patients with
    multiple sclerosis. However, many pharmaceutical companies and
    research organizations are developing products and technologies
    that are intended to prevent cardiac damage, improve cardiac
    function, and regenerate cardiac muscle after a heart attack.
    There are also companies
</TD>
</TR>

</TABLE>
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>
</TD>
    <TD align="left">
    developing products that remyelinate neurons and provide
    functional improvement for multiple sclerosis patients. If we
    were to successfully develop RGN-352 for other cardiovascular
    indications, such as acute or chronic heart failure, such a
    product would have to compete with other drugs or therapies
    currently marketed by large pharmaceutical companies for similar
    indications, as would products for the treatment of multiple
    sclerosis.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <B><I>RGN-259.</I></B>&#160;&#160;Most specialty ophthalmic
    companies have a number of products on the market that could
    compete with RGN-259. There are numerous antibiotics to treat
    eye infections that cause corneal wounds and many eye
    lubrication products to help eye healing and function, many of
    which are sold without prescriptions. Companies also market
    steroids to treat certain severe conditions within our area of
    interest. Allergan, Inc. has marketed
    Restasis<SUP style="font-size: 85%; vertical-align: top"><FONT style="font-variant: SMALL-CAPS">tm</FONT></SUP>,

    a relatively new approved eye drop to treat dry eye. Dry eye is
    a condition related to a number of diseases and one that we
    believe could benefit from the use of RGN-259.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <B><I>RGN-137.</I></B>&#160;&#160;Johnson&#160;&#038; Johnson
    has marketed
    Regranex<SUP style="font-size: 85%; vertical-align: top"><FONT style="font-variant: SMALL-CAPS">tm</FONT></SUP>

    for patients with diabetic foot ulcers. Companies such as
    Novartis are developing and marketing artificial skins, which
    would compete with RGN-137 in the treatment of dermal wound
    healing. There are other companies developing new pharmaceutical
    products for wound healing. Products and therapies such as
    antibiotics, honey-based ointments and low frequency
    cavitational ultrasound are also used to treat certain types of
    dermal wounds. Moreover, dermal wound healing is a large and
    highly fragmented marketplace that includes numerous therapeutic
    products and medical devices for treating acute and chronic
    dermal wounds.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <B><I>RGN-457.</I></B>&#160;&#160;CF is a genetic defect for
    which there is no cure. There are mucolytic agents and
    antibiotic drugs on the market, such as Genentech&#146;s
    pulmozyme and Novartis&#146;
    TOBI<SUP style="font-size: 85%; vertical-align: text-top">&#174;</SUP>,

    an inhaled version of tobramycin, that relieve the symptoms
    posed by CF and could potentially compete with RGN-457.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <B><I>Cosmeceuticals.</I></B>&#160;&#160;The cosmetics industry
    is highly competitive and dependent on effective marketing and
    distribution. There are multiple products currently launched by
    major international cosmetic enterprises that claim the same or
    similar benefits that may be claimed with our product candidates.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Government
    Regulation</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In the United States, the Federal Food, Drug, and Cosmetic Act,
    as amended, and the regulations promulgated thereunder, and
    other federal and state statutes and regulations govern, among
    other things, the testing, manufacturing, labeling, storing,
    recordkeeping, distribution, advertising and promotion of our
    product candidates. Regulation by governmental authorities in
    the United States and foreign countries will be a significant
    factor in the manufacturing and marketing of our product
    candidates and in our ongoing research and product development
    activities. Any product candidate we develop will require
    regulatory approval by governmental agencies prior to
    commercialization. In particular, human therapeutic products are
    subject to rigorous preclinical studies, clinical trials and
    other approval procedures by the FDA and similar health
    authorities in foreign countries. The process of obtaining these
    approvals and subsequent compliance with appropriate federal and
    state statutes and regulations requires the expenditure of
    substantial resources.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Preclinical studies must ordinarily be conducted to evaluate an
    investigational new drug&#146;s potential safety by toxicology
    studies and potential efficacy by pharmacology studies. The
    results of these studies, among other things, are submitted to
    the FDA as part of an Investigational New Drug Application, or
    IND, which must be reviewed by the FDA before clinical trials
    can begin. Typically, clinical evaluation involves a three-stage
    process. Phase 1 clinical trials are conducted with a small
    number of healthy volunteers to determine the safety profile and
    the pattern of drug absorption, distribution, metabolism and
    excretion, and to assess the drug&#146;s effect on the patient.
    Phase 2, or therapeutic exploratory, trials are conducted with
    somewhat larger groups of patients, who are selected by
    relatively narrow criteria yielding a more homogenous population
    that is afflicted with the target disease, in order to determine
    preliminary efficacy, optimal dosages and expanded evidence of
    safety. Phase 2 trials should allow for the determination of the
    dose to be used in Phase 3 clinical trials. Phase 3, or
    therapeutic confirmatory, large scale, multi-center, comparative
    trials are conducted with patients afflicted with a target
    disease in order to provide enough data for the statistical
    proof of safety and efficacy required by the FDA and other
    regulatory authorities. The primary objective of Phase 3
    clinical trials
</DIV>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    is to show that the drug confers therapeutic benefit that
    outweighs any safety risks. All clinical trials must be
    registered with a central public database, such as
    www.clinicaltrials.gov, and once completed, results of the
    clinical trials must be entered in the database.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The results of all of these preclinical studies and clinical
    trials, along with detailed information on manufacturing, are
    submitted to the FDA in the form of a New Drug Application, or
    NDA, for approval to commence commercial sales. The FDA&#146;s
    review of an NDA requires the payment of a user fee currently in
    excess of $1&#160;million, which may be waived for the first NDA
    submitted by a qualifying small business. In responding to an
    NDA, the FDA may refuse to file the application if the FDA
    determines that the application does not satisfy its regulatory
    approval criteria, request additional information or grant
    marketing approval. Therefore, even if we complete Phase 3
    clinical trials for our product candidates and submit an NDA to
    the FDA, there can be no assurance that the FDA will grant
    marketing approval, or if granted, that it will be granted on a
    timely basis. If the FDA does approve a product candidate, it
    may require, among other things, post-marketing testing,
    including potentially expensive Phase 4 trials, which monitor
    the safety of the drug. In addition, the FDA may in some
    circumstances impose risk evaluation and mitigation strategies
    that may be difficult and expensive to administer. Product
    approvals may be withdrawn if compliance with regulatory
    requirements is not maintained or if problems occur after the
    product reaches the market.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Among the conditions for NDA approval is the requirement that
    the applicable clinical, pharmacovigilance, quality control and
    manufacturing procedures conform on an ongoing basis with
    current Good Clinical Practices, Good Laboratory Practices,
    current Good Manufacturing Practices, and computer information
    system validation standards. During the review of an NDA, the
    FDA will perform a pre-licensing inspection of select clinical
    sites, manufacturing facilities and the related quality control
    records to determine the applicant&#146;s compliance with these
    requirements. To assure compliance, applicants must continue to
    expend time, money and effort in the area of training,
    production and quality control. After approval of any product,
    manufacturers are subject to periodic inspections by the FDA. If
    a company fails to comply with FDA regulatory requirements, FDA
    may pursue a wide range of remedial actions, including seizure
    of products, corrective actions, warning letters and fines.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In June 2004, we received orphan drug designation from the FDA
    for T&#223;4 for the treatment of EB. The FDA may designate a
    product or products as having orphan drug status to treat a
    disease or condition that affects less than 200,000 individuals
    in the United States, or, if patients of a disease number more
    than 200,000, the sponsor can establish that it does not
    realistically anticipate its product sales will be sufficient to
    recover its costs. If a product candidate is designated as an
    orphan drug, then the sponsor may receive incentives to
    undertake the development and marketing of the product,
    including grants for clinical trials, as well as a waiver of the
    user fees for submission of an NDA application. For example, as
    described above, we received a grant of approximately $681,000
    in the aggregate for our ongoing Phase 2 clinical trial of
    RGN-137 to treat patients with EB.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Generally, if a product with an orphan drug designation
    subsequently receives the first marketing approval for the
    indication for which it has such designation, the product is
    entitled to marketing exclusivity for a period of seven years in
    the United States. There may be multiple designations of orphan
    drug status for a given drug and for different indications.
    Orphan drug designation does not guarantee that a product
    candidate will be approved by the FDA for marketing for the
    designation, and even if a sponsor of a product candidate for an
    indication for use with an orphan drug designation is the first
    to obtain FDA approval of an NDA for that designation and
    obtains marketing exclusivity, another sponsor&#146;s
    application for the same drug product may be approved by the FDA
    during the period of exclusivity if the FDA concludes that the
    competing product is clinically superior. In this instance, the
    orphan designation and marketing exclusivity originally granted
    would be lost in favor of the clinically superior product.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Intellectual
    Property</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have applied for or hold over 60 worldwide patents on peptide
    compositions, uses and formulations related to dermal and
    ophthalmic indications and other organ and tissue repair
    activities, as well as for cosmetic and consumer product
    applications. In 2001, we entered into a license agreement with
    the NIH under
</DIV>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    which we received an exclusive worldwide license from the NIH
    for all claims within the scope of the NIH&#146;s patent
    application, and any issued patents, covering the use of
    T&#223;4 as a tissue repair and regeneration factor. During
    2007, a patent was issued in Europe and the U.S.&#160;related to
    the original NIH patent application, which patent expires in
    July 2019. Corresponding patents have been granted in Hong Kong,
    Australia and China and certain other territories. The issued
    European patent was opposed by a third party at the European
    Patent Office and in December 2009, we argued the case before
    the Opposition Division of the European Patent Office in Munich,
    Germany and prevailed. In exchange for the exclusive license, we
    agreed to make certain minimum royalty and milestone payments to
    the NIH. Through December&#160;31, 2009, we have complied with
    all minimum royalty requirements, and no milestone payments have
    been required under the agreement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We hold a U.S.&#160;patent relating to the use of T&#223;4 for
    treatment of alopecia, an autoimmune skin disease that results
    in hair loss, which expires in 2017, with corresponding patents
    in Europe and Singapore that expire in 2018. In 2006, we were
    issued a patent in China for the use of T&#223;4 to treat EB,
    which expires in 2022.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Under a research agreement with The George Washington
    University, or GWU, we funded T&#223;4 research at GWU and
    received a sole and exclusive worldwide license to any resulting
    patents. While we no longer fund any research under this
    agreement, we remain obligated to pay GWU a royalty of 4% of the
    net sales, if any, of specified products covered by patents
    issued in connection with the agreement. Pursuant to the
    research agreement, we have exclusive rights to patent
    applications filed in the United States and in Europe disclosing
    the use of T&#223;4 for the treatment of septic shock and
    associated syndromes, including Adult Respiratory Distress
    Syndrome. Two U.S.&#160;patents covered by this agreement have
    been issued, which expire in 2013 and 2014.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have also filed numerous additional U.S.&#160;and
    international patent applications covering various compositions,
    uses, formulations and other components of T&#223;4, as well as
    for novel peptides resulting from our research efforts. There
    can be no assurance that these, or any other future patent
    applications under which we have rights, will result in the
    issuance of a patent or that any patent issued will not be
    subject to challenge or opposition. In the case of a claim of
    patent infringement by or against us, there can be no assurance
    that we will be able to afford the expense of any litigation
    that may be necessary to enforce our proprietary rights.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Material
    Agreements</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">National
    Institutes of Health</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have entered into a license agreement with NIH under which we
    are obligated to pay an annual minimum royalty of $25,000.
    Additionally, we are obligated to pay the NIH a percentage of
    sales of qualifying product candidates, if any. There have been
    no such sales to date.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Defiante/Sigma-Tau</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have exclusively licensed certain internal and external wound
    healing European rights to T&#223;4 to Defiante Farmaceutica,
    S.A., or Defiante, a Portuguese company that is a wholly owned
    subsidiary of Sigma-Tau. These licensed rights to T&#223;4
    include its use to treat indications that are the subject of all
    of our current dermal clinical trials as well as the treatment
    of heart attacks. The license excludes the use of T&#223;4 in
    ophthalmic indications and other indications that are
    disease-based and not the result of a wound. Under the
    agreement, Sigma-Tau will develop T&#223;4 for the treatment of
    internal and external wounds in Europe and certain other
    contiguous and geographically relevant countries. The license
    agreement expires on a
    <FONT style="white-space: nowrap">country-by-country</FONT>
    basis upon the later of the expiration of the last to expire of
    any granted patent in the territory having at least one valid
    claim covering the products then on the market, the expiration
    of any other exclusive or proprietary marketing rights, or
    January 2016.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Under the license agreement, Sigma-Tau is obligated to pay us a
    royalty on commercial sales, if any, and we will supply all
    required T&#223;4 for development. Upon the completion of a
    Phase 2 clinical trial for the covered indications that yields
    positive results in terms of efficacy and safety, Sigma-Tau must
    either pay us a $5&#160;million milestone payment or initiate
    and fund a pivotal Phase 3 clinical trial for the applicable
    product candidate in order to maintain the license. As described
    elsewhere in this prospectus, in 2009, we completed
</DIV>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    two Phase 2 clinical trials of RGN-137 for the treatment of
    pressure ulcers and venous stasis ulcers, which, due to the lack
    of statistical significance of the reported efficacy results,
    have not triggered the milestone obligation described above.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The license agreement with Defiante also contains future
    clinical and regulatory milestones in the licensed territory. If
    those milestones are attained, certain performance criteria
    regarding commercial registration and minimum annual royalties
    will be payable to us in each licensed country. The agreement
    does not prevent us from sublicensing the technology in
    countries outside the licensed territory, and has no impact on
    any U.S.&#160;rights.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Development
    Agreements</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have entered into agreements with outside service providers
    for the manufacture and development of T&#223;4, the formulation
    of T&#223;4 into our product candidates, the conduct of
    nonclinical safety, toxicology and efficacy studies in animal
    models, and the management and execution of clinical trials in
    humans. Terms of these agreements vary in that they can last
    from a few months to more than a year in duration. Certain of
    these agreements require initial up front payments ranging from
    25% to 50% of the total estimated cost. For additional
    information regarding our research and development expenses over
    the past two years, see &#147;Management&#146;s Discussion and
    Analysis of Financial Condition and Results of
    Operations&#160;&#151; Results of Operations&#148; in this
    prospectus.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Employees</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    To balance costs and optimize control, we utilize an outsourcing
    business strategy, whereby our management oversees the
    outsourced activities for many of our research and development
    and administrative functions. We currently have nine full-time
    employees and one part-time employee, and we retain several
    independent contractors on an as-needed basis. We believe that
    we have good relations with our employees.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Facilities</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our corporate headquarters are located in Rockville, Maryland
    where we lease approximately 3,500&#160;square feet of office
    space with an average base rent of $7,300 per month and a term
    through January 2013. We believe that our facilities are
    generally suitable to meet our needs for the foreseeable future,
    although we will continue to seek alternate or additional space
    as needed.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Corporate
    Information</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We were incorporated in Delaware in 1982 under the name Alpha 1
    Biomedicals, Inc. In 2000, we changed our corporate name to
    RegeneRx Biopharmaceuticals, Inc. Our principal executive office
    is located at 15245 Shady Grove Road, Suite&#160;470, Rockville,
    Maryland 20850. Our telephone number is
    <FONT style="white-space: nowrap">(301)&#160;208-9191.</FONT>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Legal
    Proceedings</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We are not currently a party to or engaged in any material legal
    proceedings. However, we may be subject to various claims and
    legal actions arising in the ordinary course of business from
    time to time.
</DIV>
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<A name='111'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">MANAGEMENT</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Executive
    Officers and Directors</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table sets forth as of the date of this prospectus
    the name, age and position of each person who serves as an
    executive officer or director of our company. There are no
    family relationships among any of our executive officers or
    directors, with the exception that Mr.&#160;Finkelstein is the
    first cousin of Dr.&#160;Goldstein&#146;s wife.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We seek to assemble a board that, as a whole, possesses the
    appropriate balance of professional and industry knowledge.
    financial expertise and high-level management experience
    necessary to oversee and direct our business. To that end, our
    board intends to maintain membership of directors who complement
    and strengthen the skills of other members and who also exhibit
    integrity, collegiality, sound business judgment and other
    qualities that we view as critical to effective functioning of
    the board. The brief biographies below include information, as
    of the date of this prospectus, regarding the specific and
    particular experience, qualifications, attributes or skills of
    each director or nominee that led the board to believe that the
    director should serve on the board.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="43%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=quadleft -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=quadright -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="52%">&nbsp;</TD>	<!-- colindex=03 type=maindata -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Name</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Age</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Position</B>
</DIV>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    J.J. Finkelstein
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    58
</TD>
<TD>&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="bottom">
    President, Chief Executive Officer and Director
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    C. Neil Lyons
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    53
</TD>
<TD>&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="bottom">
    Chief Financial Officer
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    David R. Crockford
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    64
</TD>
<TD>&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="bottom">
    Vice President, Clinical and Regulatory Affairs
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Allan L. Goldstein, Ph.D.
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    72
</TD>
<TD>&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="bottom">
    Director, Chairman of the Board and Chief Scientific Advisor
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Richard J. Hindin
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    67
</TD>
<TD>&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    Director
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Joseph C. McNay
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    76
</TD>
<TD>&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    Director
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Mauro Bove
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    55
</TD>
<TD>&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    Director
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    L. Thompson Bowles,&#160;M.D., Ph.D.&#160;
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    78
</TD>
<TD>&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    Director
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Mr.&#160;Finkelstein</I> has served as our President and
    Chief Executive Officer and a member of our Board of Directors
    since 2002. Mr.&#160;Finkelstein also served as our Chief
    Executive Officer from 1984 to 1989 and as the Vice Chairman of
    our Board of Directors from 1989 to 1991. Mr.&#160;Finkelstein
    has worked as an executive officer and consultant in the
    bioscience industry for the past 28&#160;years, including
    serving from 1989 to 1996 as chief executive officer of
    Cryomedical Sciences, Inc., a publicly-traded medical device
    company. Mr.&#160;Finkelstein has significant experience in
    developing early-stage companies. He has been responsible for
    the regulatory approval and marketing of several medical devices
    in the U.S.&#160;and abroad. Mr.&#160;Finkelstein has served on
    the executive committee of the Board of Directors of the
    Technology Council of Maryland since 2006, MdBio, Inc. since
    1998 and currently chairs the MdBio Foundation, all of which are
    non-profit entities that support bioscience development and
    education in the State of Maryland. Mr.&#160;Finkelstein
    received a business degree in finance from the University of
    Texas. The Board believes that Mr.&#160;Finkelstein&#146;s
    history and long tenure as our Chief Executive Officer positions
    him to contribute to the Board his extensive knowledge of our
    company and to provide Board continuity. In addition, the Board
    believes that his experience at prior companies has provided him
    with operational and industry expertise, as well as leadership
    skills that are important to the Board.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Mr.&#160;Lyons</I> has served as our Chief Financial Officer
    and Treasurer since 2005. With more than 25&#160;years of
    experience, Mr.&#160;Lyons has developed expertise related to
    operations, finance, SEC compliance, complex transactions,
    strategy, information systems and corporate governance. From
    1979 to 1990, Mr.&#160;Lyons practiced with Deloitte, providing
    assurance and advisory services to several public companies in
    the Washington,&#160;D.C. metro area. Following that,
    Mr.&#160;Lyons served as a senior financial executive with HFS,
    Inc., a major Department of Defense contractor, from 1990 to
    1996, with Bell Atlantic from 1996 to 1998, with SkyBridge LP,
    an international satellite broadband
    <FONT style="white-space: nowrap">start-up</FONT>
    affiliated with Alcatel, from 1998 to 2003, and consulted with
    area businesses regarding financial management, including the
    initial implementations of the Sarbanes-Oxley
</DIV>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Act from 2003 to 2005. Mr.&#160;Lyons is a certified public
    accountant and received a Bachelor of Science degree in
    accounting, magna cum laude, from Florida Southern College.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Mr.&#160;Crockford</I> has served as our Vice President of
    Clinical and Regulatory Affairs since March 2005 and was a
    consultant to the Company from 2000 until his appointment as
    Vice President. He has more than 25&#160;years of experience in
    the biotechnology and pharmaceutical industries. During his
    career as a clinical and regulatory affairs professional,
    Mr.&#160;Crockford has established strategic plans, implemented
    and obtained marketing approval for 18 drug products, including
    one of the first human growth hormone preparations sold in the
    U.S., 17 in&#160;vitro diagnostic tests, and an intraoperative
    medical device to detect and treat cancer.
    Mr.&#160;Crockford&#146;s other clinical and regulatory
    achievements include the cost-effective and timely development
    of a number of innovative investigational drugs.
    Mr.&#160;Crockford is the author of a number of publications,
    including <I>Development of Thymosin &#223;4 for Treatment of
    Patients with Ischemic Heart Disease</I>, and is an inventor or
    co-inventor on approximately two dozen patents related to drug
    development. Mr.&#160;Crockford has a B.A. degree in biology and
    chemistry from Boston University. He also completed biochemistry
    and clinical chemistry course studies in Princeton, New Jersey,
    and seminars in reproductive medicine at medical schools at
    Wayne State University and UCLA.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Dr.&#160;Goldstein</I> has served as the Chairman of our
    Board of Directors and our Chief Scientific Advisor since he
    founded our company in 1982. Dr.&#160;Goldstein has been a
    Professor of Biochemistry since 1978 and served as Chairman of
    the Department of Biochemistry and Molecular Biology at the
    George Washington University School of Medicine and Health
    Sciences until 2009. Dr.&#160;Goldstein is a recognized expert
    in the field of immunology and protein chemistry, having
    authored over 430 scientific articles in professional journals.
    He is also the inventor on over 25 issued
    <FONT style="white-space: nowrap">and/or</FONT>
    pending patents in biochemistry, immunology, cardiology, cancer
    and wound healing. Dr.&#160;Goldstein discovered several
    important compounds, including T&#945;1, which is marketed
    worldwide, and T&#223;4, which is the basis for RegeneRx&#146;s
    clinical program. Dr.&#160;Goldstein has served on the Board of
    Trustees of the Sabin Vaccine Institute since 2000 and on the
    Board of Directors of the Richard B. and Lynne V. Cheney
    Cardiovascular Institute since 2006. Dr.&#160;Goldstein has also
    done pioneering work in the area of medical education,
    developing distance learning programs offered through
    &#147;Frontiers in Medicine,&#148; a medical education series
    that Dr.&#160;Goldstein developed. The Board believes that
    Dr.&#160;Goldstein&#146;s scientific expertise, industry
    background and prior experience as our founder all position him
    to make an effective contribution to the medical and scientific
    understanding of the Board, which the Board believes to be
    particularly important as we continue our T&#223;4 development
    efforts.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Mr.&#160;Hindin</I> has served as a member of our Board of
    Directors since 2002. Mr.&#160;Hindin has been an entrepreneur
    during his more than 40&#160;year career and is currently the
    principal stockholder of Chicken Out Rotisserie, Inc., which
    operates 15 restaurants in three states and the District of
    Columbia. Mr.&#160;Hindin has served since 1987 as a member and
    since 1989 as the chairman of the board of directors of The
    Institute for Advanced Studies in Aging&#160;&#038; Geriatric
    Medicine, or IASIA, a non-profit corporation that disseminates
    medical information to the public as well as providing the
    pharmaceutical industry with an independent source for testing
    vaccines and drugs for the elderly. Mr.&#160;Hindin&#146;s
    entrepreneurial background includes several companies and
    commenced with Britches of Georgetown, Inc., a clothing retailer
    specializing in the sale of upscale men&#146;s and women&#146;s
    apparel and accessories which he co-founded. Mr.&#160;Hindin has
    also served as Chairman of the Board of Hinsilblon Laboratories
    Ltd., a company based in Fort&#160;Myers, Florida which sells
    odor neutralization products and delivery systems, since 1990.
    Finally, Mr.&#160;Hindin has served as President of Adworks Inc,
    a Washington D.C.-based advertising and marketing consulting
    agency, since 1987. During 2009, Mr.&#160;Hindin filed for
    personal bankruptcy under the U.S.&#160;Bankruptcy Code and is
    currently involved in proceedings related to the matter. The
    Board believes that Mr.&#160;Hindin&#146;s extensive experience
    as an entrepreneur will be increasingly valuable to the Board as
    we seek to expand and finance our operations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Mr.&#160;McNay</I> has served as a member of our Board of
    Directors since 2002. He is currently Chairman, Chief Investment
    Officer and Managing Principal of Essex Investment Management
    Company, LLC, positions he has held since 1976 when he founded
    Essex. He has direct portfolio management responsibilities for a
    variety of funds and on behalf of private clients. He is also a
    member of the firm&#146;s Management Board. Prior to founding
    Essex, Mr.&#160;McNay was Executive Vice President and Director
    of Endowment Management&#160;&#038; Research Corp. from 1967.
    Prior to that, Mr.&#160;McNay was Vice President and Senior
    Portfolio Manager at the
</DIV>
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    Massachusetts Company. Currently he is serving as Trustee of
    National Public Radio, Trustee of the Dana Farber Cancer
    Institute, and is a Trustee and member of the Children&#146;s
    Hospital Investment Committee. He received his A.B. degree from
    Yale University and his M.B.A. degree in finance from the
    Wharton School of the University of Pennsylvania. The Board
    believes that Mr.&#160;McNay&#146;s extensive financial
    experience is valuable to our business and also positions him to
    contribute to the Audit Committee&#146;s understanding of
    financial matters.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Mr.&#160;Bove</I> has served as a member of our Board of
    Directors since 2004 and has more than 25&#160;years of business
    and management experience within the pharmaceutical industry.
    Mr.&#160;Bove is currently the Head of Corporate&#160;&#038;
    Business Development and serves on the board of Sigma-Tau
    Finanziaria S.p.A., the holding company of Sigma-Tau Group, a
    leading international pharmaceutical company, and certain
    Sigma-Tau affiliates, positions he has held since 1993.
    Sigma-Tau Finanziaria S.p.A. and its affiliates are collectively
    our largest stockholder. Mr.&#160;Bove has also held a number of
    senior positions in business, licensing and corporate
    development within Sigma-Tau Group, which has subsidiaries in
    most European countries and the United&#160;States.
    Mr.&#160;Bove obtained his law degree at the University of
    Parma, Italy, in 1980. In 1985, he attended the Academy of
    American and International Laws at the International and
    Comparative Law Center, Dallas,&#160;Texas. The Board believes
    that Mr.&#160;Bove&#146;s extensive business and management
    experience within the pharmaceutical industry allows him to
    recognize and advise the Board with respect to recent industry
    developments.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Dr.&#160;Bowles</I> has served as a member of our Board of
    Directors since 2006. He retired from his career as a thoracic
    surgeon in 1988. Dr.&#160;Bowles served as Dean of Medicine and
    Professor of Surgery at The George Washington University, or
    GWU, School of Medicine and Health Sciences from 1976 to 1988
    and as Vice President for Medical Affairs and Executive Dean of
    the GWU Medical Center from 1988 to 1992. Dr.&#160;Bowles
    previously served as President of the National Board of Medical
    Examiners, a medical accrediting organization, from 1992 to
    2000. He has also been a member of the National Academy of
    Sciences Institute of Medicine since 1988 and currently serves
    as a member of several other national medical societies
    including: The American College of Surgeons, The American
    Association for Thoracic Surgery, The Society of Thoracic
    Surgeons, The American College of Chest Physicians, The American
    Gerontological Society, The Society of Medical Administrators,
    The College of Physicians of Philadelphia, and The Washington
    Academy of Surgeons. Dr.&#160;Bowles has served on the editorial
    board of a number of medical journals, including the Journal of
    Medical Education and continued on as chairman of its newly
    revised updated version, Academic Medicine. Dr.&#160;Bowles has
    been President of the District of Columbia&#146;s medical
    licensing board called the Healing Arts Commission
    <FONT style="white-space: nowrap">(1977-1979),</FONT>
    and was a member of the National Library of Medicine&#146;s
    Board of Regents
    <FONT style="white-space: nowrap">(1982-1986),</FONT>
    chairman
    <FONT style="white-space: nowrap">(1984-1986),</FONT>
    member of the Special Medical Advisory Group of Veterans
    Administration (now Dept. of Veterans Affairs)
    <FONT style="white-space: nowrap">1984-1992,</FONT>
    chairman
    <FONT style="white-space: nowrap">1992-1994.</FONT>
    Dr.&#160;Bowles was also chairman of the National Committee on
    Foreign Medical Education and Accreditation,
    <FONT style="white-space: nowrap">1994-1996.</FONT>
    Dr.&#160;Bowles received his medical degree from Duke University
    and his Ph.D. in higher education from New York University. The
    Board believes that Dr.&#160;Bowles&#146; distinguished medical
    career positions him to bring extensive medical and clinical
    trial experience to the Board. The Board expects that this
    experience will permit Dr.&#160;Bowles to provide leadership and
    insight as we translate our laboratory discoveries into human
    clinical trials and advance our product candidates through
    clinical development toward commercialization.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Independence
    of the Board of Directors</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As required under NYSE Amex listing standards, a majority of the
    members of a listed company&#146;s board of directors must
    qualify as &#147;independent,&#148; as affirmatively determined
    by the Board. The Board consults with counsel to ensure that the
    Board&#146;s determinations are consistent with relevant
    securities and other laws and regulations regarding the
    definition of &#147;independent,&#148; including those set forth
    in pertinent listing standards of the NYSE Amex, as in effect
    from time to time.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Consistent with these considerations, after review of all
    relevant identified transactions or relationships between each
    director, or any of his family members, and us, our senior
    management and our independent auditors, the Board has
    affirmatively determined that the following four directors are
    independent directors within the meaning of the applicable NYSE
    Amex listing standards: Mr.&#160;Hindin, Mr.&#160;Bove,
    Mr.&#160;McNay and Dr.&#160;Bowles. In making this
    determination, the Board found that none of the these directors
    had a material or
</DIV>
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    other disqualifying relationship with us. Mr.&#160;Finkelstein,
    our President and Chief Executive Officer, and
    Dr.&#160;Goldstein, our Chief Scientific Advisor, are not
    independent directors by virtue of their employment with us.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In determining the independence of Mr.&#160;Bove, the board of
    directors took into account the significant ownership of our
    common stock by Sigma-Tau and its affiliates. The board of
    directors does not believe that any of the transactions with
    Sigma-Tau and its affiliates described would interfere with
    Mr.&#160;Bove&#146;s exercise of independent judgment in
    carrying out his responsibilities as a director of our company.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Information
    Regarding Committees of the Board of Directors</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Board has two standing committees: an Audit Committee and a
    Compensation Committee. The Board does not have a separate
    nominating and corporate governance committee. Rather, the
    independent members of the full Board perform the functions of a
    nominating and corporate governance committee.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Below is a description of each committee of the Board. Each of
    the committees has authority to engage legal counsel or other
    experts or consultants, as it deems appropriate to carry out its
    responsibilities. The Board has determined that each member of
    each committee meets the applicable NYSE Amex rules and
    regulations regarding &#147;independence&#148; and that each
    member is free of any relationship that would impair his
    individual exercise of independent judgment with regard to our
    company.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Audit
    Committee</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Audit Committee of the Board consists of Messrs.&#160;Hindin
    and McNay and Dr.&#160;Bowles, with Mr.&#160;Hindin acting as
    the Chairman of the committee. The Audit Committee meets no less
    than quarterly with management and our independent registered
    public accounting firm, both jointly and separately, has sole
    authority to engage and terminate our independent registered
    public accounting firm, and reviews our financial reporting
    process on behalf of the Board. The Audit Committee operates
    under a formal written charter available on our website at
    www.regenerx.com.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Each member of the Audit Committee is an independent director in
    accordance with both Section&#160;121A of the NYSE Amex listing
    standards and
    <FONT style="white-space: nowrap">Rule&#160;10A-3</FONT>
    of the Exchange Act. Furthermore, the Board has determined that
    Messrs.&#160;Hindin and McNay qualify as &#147;audit committee
    financial experts&#148; as defined under SEC rules.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Audit Committee pre-approves all audit and non-audit
    engagement fees, and terms and services. On an ongoing basis,
    management communicates specific projects and categories of
    services for which advance approval of the Audit Committee is
    required. The Audit Committee reviews these requests and advises
    management and the independent auditors if the Audit Committee
    pre-approves the engagement of the independent auditors for such
    projects and services. On a periodic basis, the independent
    auditors report to the Audit Committee the actual spending for
    such projects and services compared to the approved amounts.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Compensation
    Committee</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Compensation Committee is composed of four directors:
    Messrs.&#160;Hindin, McNay and Bove and Dr.&#160;Bowles. All
    members of our Compensation Committee are independent, as
    independence is currently defined in Section&#160;803A of the
    NYSE Amex listing standards. The Compensation Committee has
    adopted a written charter that is available to stockholders on
    our website at www.regenerx.com.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Compensation Committee of the Board acts on behalf of the
    Board to review, adopt and oversee our compensation strategy,
    policies, plans and programs, including:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    establishment of corporate and individual performance objectives
    relevant to the compensation of our chief executive officer,
    other executive officers and Board members;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    evaluation of performance in light of these stated objectives;
</TD>
</TR>

</TABLE>
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    50
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<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    review and approval of the compensation and other terms of
    employment or service, including severance and
    <FONT style="white-space: nowrap">change-in-control</FONT>
    arrangements, of our Chief Executive Officer and the other
    executive officers;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    administration of our equity compensation plans and other
    similar plan and programs.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Nominating
    and Corporate Governance</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Board does not have a standing nominating and corporate
    governance committee. Instead, pursuant to Section&#160;804 of
    the NYSE Amex listing standards, the independent members of the
    Board, consisting of Messrs.&#160;Hindin, McNay and Bove and
    Dr.&#160;Bowles, are responsible for performing key nominating
    and corporate governance activities on behalf of the Board,
    including identifying, reviewing and evaluating candidates to
    serve as our directors, reviewing and evaluating incumbent
    directors, selecting candidates for election to the Board,
    making recommendations to the Board regarding the membership of
    the committees of the Board, assessing the performance of
    management and developing and maintaining a set of corporate
    governance principles for us. All members of the Board
    performing the role of a nominating and corporate governance
    committee are &#147;independent&#148; as defined in
    Section&#160;803A of the NYSE Amex listing standards.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Director
    Compensation</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table set forth certain information for the fiscal
    year ended December&#160;31, 2009 with respect to the
    compensation of our directors. Mr.&#160;Finkelstein&#146;s
    compensation is disclosed in the Summary Compensation Table
    below, and he does not receive any additional compensation for
    his service as a director. Dr.&#160;Goldstein is an employee of
    our company and his compensation as an employee is set forth in
    the table below. He does not receive any additional compensation
    for his service as a director.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Each non-employee director is eligible to receive an annual cash
    retainer of $13,905. The chairman of each of our audit committee
    and compensation committee is eligible to receive a supplemental
    annual cash retainer of $10,300. Mr.&#160;Hindin currently
    serves as the chairman of each of these committees.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Directors also receive $1,288 for each board meeting attended in
    person and $412 for each Board meeting attended by telephone.
    Additionally, members of each committee of the board of
    directors are eligible to receive $515 for each committee
    meeting attended, whether in person or by telephone.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Additionally, non-employee directors receive a nonqualified
    stock option under our stock option plan to purchase
    15,000&#160;shares of common stock upon their re-election as a
    director at each annual meeting of stockholders. Newly elected
    or appointed non-employee directors receive a nonqualified stock
    option under our stock option plan to purchase
    35,000&#160;shares of common stock. All options granted to
    directors under this policy vest over four years, with 25% of
    the shares underlying the option vesting on the first through
    fourth anniversaries of the date of grant.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We also reimburse directors for expenses incurred in attending
    meetings of the board and other events attended on our behalf
    and at our request.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Of note, our annual rates of director compensation in effect at
    December&#160;31, 2008 and 2009 remain the same. However, given
    our limited cash resources during most of 2009, the Board
    elected to reduce the cash fees payable to the Board for their
    services by 35% for the period from April 1 to
    September&#160;30, 2009. Consequently, the following charts of
    actual compensation may differ from the disclosed annual rates
    of compensation currently in effect.
</DIV>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    51
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In return for the 35% director fee reduction, each director
    received options to purchase shares of our common stock at an
    exercise price of $0.57 per share. We granted options to
    purchase an aggregate of 64,157&#160;shares of our common stock
    pursuant to this arrangement. Effective October&#160;1, 2009,
    director fees were restored to the levels in effect at
    December&#160;31, 2008 and, therefore, the options ceased
    vesting as of September&#160;30, 2009 but remain exercisable to
    the extent vested as of September&#160;30, 2009 in accordance
    with the terms of our stock option plan. The number of shares
    vested and outstanding from these option grants are included
    within the amounts set forth in Footnote 1 to the table below.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Director
    Compensation for Fiscal 2009</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="57%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="4%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="5%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Fees Earned<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>or Paid<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Option<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>All Other<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>in Cash<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Awards<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Compensation<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Total<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Name</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>($)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>($)(1)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>($)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>($)</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Allan&#160;Goldstein, Ph.D.
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    71,348
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    162,466
</TD>
<TD nowrap align="left" valign="bottom">
    (2)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    233,814
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Richard Hindin
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    37,877
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    16,039
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    53,916
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    L. Thompson&#160;Bowles&#160;M.D., Ph.D.
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    21,105
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    11,875
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    32,980
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Joseph McNay
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    18,028
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    10,917
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    28,945
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Mauro Bove
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    16,292
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    10,459
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    26,751
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    These amounts reflect the aggregate full grant date fair values
    (computed in accordance with FASB ASC Topic 718)&#160;of options
    granted to directors during 2009, a portion of which vested
    during 2009 as described above. Options held by each Board
    member as of December&#160;31, 2009, are as follows:</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="88%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="4%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<!-- TableOutputBody -->
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Allan&#160;Goldstein, Ph.D.
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    696,942
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Richard Hindin
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    237,749
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    L. Thompson&#160;Bowles&#160;M.D., Ph.D.
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    154,843
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Joseph McNay
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    228,024
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Mauro Bove
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    227,155
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (2) </TD>
    <TD></TD>
    <TD valign="bottom">
    In addition to being Chairman of our Board of Directors,
    Dr.&#160;Goldstein also serves as our Chief Scientific Advisor.
    In this capacity, Dr.&#160;Goldstein received a base salary of
    $153,093 for 2009, and a discretionary cash bonus of $9,373.
    Under Dr.&#160;Goldstein&#146;s employment agreement, in the
    event that his employment is terminated by us without
    &#147;cause,&#148; as defined in his employment agreement, or if
    he voluntarily terminates his employment within 12&#160;months
    following a &#147;change in control,&#148; as defined in his
    employment agreement, then in each case, subject to
    Dr.&#160;Goldstein&#146;s entering into and not revoking a
    release of claims in a form acceptable to us, Dr.&#160;Goldstein
    will be entitled to receive a lump sum severance payment equal
    to his annual base salary then in effect, plus any earned bonus
    as of the date of termination, in each case less applicable
    taxes and withholdings. Dr.&#160;Goldstein is not entitled to
    receive any continuing health and welfare benefits as part of
    our severance obligation to him. If Dr.&#160;Goldstein&#146;s
    employment had been terminated for any of the reasons described
    in this paragraph as of December&#160;31, 2009, he would have
    been entitled to receive a lump sum payment of $187,460, less
    taxes and withholdings. Dr.&#160;Goldstein is eligible to
    receive options to purchase common stock under the 2000 Plan.
    The decision to grant any such options and the terms of such
    options are within the discretion of our board of directors or
    the compensation committee. In addition, if
    Dr.&#160;Goldstein&#146;s employment is terminated without
    &#147;cause,&#148; or if there is a &#147;change in
    control&#148; event, in each case as defined in either the 2000
    Plan or in Dr.&#160;Goldstein&#146;s employment agreement, then
    the unvested portion of Dr.&#160;Goldstein&#146;s options would
    accelerate in full. All vested options are exercisable for a
    period of time following any termination of
    Dr.&#160;Goldstein&#146;s employment as may be set forth in the
    2000 Plan or in any option agreement between Dr.&#160;Goldstein
    and us.</TD>
</TR>

</TABLE>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    52
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<A name='112'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">EXECUTIVE
    COMPENSATION</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Summary
    Compensation Table</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table shows, for the fiscal years ended
    December&#160;31, 2009 and 2008, compensation awarded to or paid
    to, or earned by, our chief executive officer and our two other
    most highly compensated executive officers during 2009 who were
    serving as executive officers at December&#160;31, 2009. For
    purposes of this prospectus, we refer to these officers as the
    named executive officers.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Of note, our annual rates of compensation for our named
    executive officers in effect at December&#160;31, 2008 and 2009
    remain the same. However, given our limited cash resources
    during 2009, the named executive officers other than
    Mr.&#160;Crockford had their annual base salaries reduced by 35%
    for the period from April 1 to September&#160;30, 2009.
    Consequently, the salary amounts set forth in the following
    table may differ from the disclosed annual base salaries
    currently in effect.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In return for the 35% salary reduction, Mr.&#160;Finkelstein and
    Mr.&#160;Lyons received options to purchase 172,122 and
    116,592&#160;shares, respectively, of our common stock at an
    exercise price of $0.57 per share. Effective October&#160;1,
    2009, their salaries were restored to the levels in effect at
    December&#160;31, 2008 and, therefore, the options ceased
    vesting as of September&#160;30, 2009 but remain exercisable in
    accordance with the terms of our stock option plan. The number
    of shares vested and outstanding from these option grants are
    set forth in the table within the &#147;Outstanding Equity
    Awards at December&#160;31, 2009&#148; section below.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="42%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=06 type=gutter -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=06 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=body -->
    <TD width="5%" align="left">&nbsp;</TD>	<!-- colindex=06 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=07 type=gutter -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=07 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=07 type=body -->
    <TD width="5%" align="left">&nbsp;</TD>	<!-- colindex=07 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=08 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=08 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=08 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=08 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Non-Equity<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Incentive<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Option<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Plan<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>All Other<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Salary(1)<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Bonus(2)<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Awards(3)<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Compensation(4)<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Compensation(5)<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Total<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Name and Principal Position</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Year</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>($)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>($)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>($)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>($)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>($)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>($)</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="color: #000000; background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    J.J. Finkelstein, President and
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2009
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    244,608
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    18,720
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    116,198
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13,005
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    392,531
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="color: #000000; background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: 0pt; margin-left: 10pt">
    Chief Executive Officer
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2008
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    299,520
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    22,464
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    86,137
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    14,976
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    17,690
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    440,787
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    C. Neil Lyons,
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2009
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    167,093
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    11,140
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    74,395
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,999
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    257,627
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: 0pt; margin-left: 10pt">
    Chief Financial Officer
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2008
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    200,817
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    12,152
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    68,848
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    10,127
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,508
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    300,452
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="color: #000000; background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    David R. Crockford,
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2009
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    210,223
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,781
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,818
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    222,822
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="color: #000000; background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: 0pt; margin-left: 10pt">
    Vice President, Clinical and Regulatory Affairs
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2008
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    209,203
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    12,613
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    51,682
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    10,511
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    11,681
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    295,690
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    Reflects base salary before pretax contributions and therefore
    includes compensation deferred under our 401(k) plan.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (2) </TD>
    <TD></TD>
    <TD valign="bottom">
     Reflects the discretionary portion of our bonus plan.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (3) </TD>
    <TD></TD>
    <TD valign="bottom">
    These amounts reflect the aggregate full grant date fair values
    (computed in accordance with FASB ASC Topic 718)&#160;of options
    granted to executives during the respective fiscal years.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (4) </TD>
    <TD></TD>
    <TD valign="bottom">
     Reflects amounts earned under our bonus plan subject to the
    achievement of corporate performance goals.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (5) </TD>
    <TD></TD>
    <TD valign="bottom">
     Primarily reflects our match of executive compensation
    deferrals into our 401(k) plan, along with supplemental life and
    disability insurance premiums. None of the individual items
    exceeded $10,000.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Employment
    Agreements; Potential Payments Upon Termination or Change in
    Control</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We are party to written employment agreements with our named
    executive officers. These employment agreements contain
    severance and other provisions that may provide for payments to
    the named executive officers following termination of employment
    with us in specified circumstances. The following is a summary
    of the material terms of these employment agreements with our
    named executive officers.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>J.J. Finkelstein.</I>&#160;&#160;We entered into an
    employment agreement with Mr.&#160;Finkelstein in January 2002
    for him to serve as our president and chief executive officer.
    Mr.&#160;Finkelstein&#146;s employment agreement had an initial
    three-year term, which is automatically renewed for additional
    one-year periods unless either we or Mr.&#160;Finkelstein elect
    not to renew it. This agreement was amended and restated during
    2008 and again in 2009. Mr.&#160;Finkelstein&#146;s annual base
    salary is $299,520. Mr.&#160;Finkelstein&#146;s salary may not
    be adjusted downward
</DIV>
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    <BR>
    53
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    without his written consent, except in a circumstance which is
    part of a general reduction or other concessionary arrangement
    affecting all employees or affecting senior executive officers.
    Mr.&#160;Finkelstein is also eligible to receive an annual bonus
    in an amount established by the board of directors and is
    entitled to participate in and receive all standard employee
    benefits and to participate in all of our applicable incentive
    plans, including stock option, stock, bonus, savings and
    retirement plans. We also provide him with $5&#160;million in
    life and disability insurance.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Mr.&#160;Finkelstein is eligible to receive options to purchase
    common stock under our Amended and Restated 2000 Stock Option
    and Incentive Plan, which we refer to in this prospectus as the
    2000 Plan. The decision to grant any such options and the terms
    of such options are within the discretion of our board of
    directors or the compensation committee thereof. All vested
    options are exercisable for a period of time following any
    termination of Mr.&#160;Finkelstein&#146;s employment as may be
    set forth in the 2000 Plan or in any option agreement between
    Mr.&#160;Finkelstein and us.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In the event that Mr.&#160;Finkelstein&#146;s employment is
    terminated by us without &#147;cause&#148; or by
    Mr.&#160;Finkelstein for &#147;good reason,&#148; each as
    defined in his employment agreement, or if Mr.&#160;Finkelstein
    voluntarily terminates his employment within 12&#160;months
    following a &#147;change in control,&#148; as defined in his
    employment agreement, then in each case, subject to
    Mr.&#160;Finkelstein&#146;s entering into and not revoking a
    release of claims in a form acceptable to us,
    Mr.&#160;Finkelstein will be entitled to receive (i)&#160;a lump
    sum severance payment equal to his annual base salary then in
    effect (or if his base salary is less than the amount in effect
    as of March&#160;31, 2009, the base salary in effect as of
    March&#160;31, 2009), plus (ii)&#160;any earned bonus, and
    (iii)&#160;if he timely elects and remains eligible for
    continuation of healthcare benefits, that portion of the
    continued healthcare premiums that we were paying prior to the
    date of termination for a period of 12&#160;months, in each case
    less applicable taxes and withholdings. If
    Mr.&#160;Finkelstein&#146;s employment had been terminated for
    any of the reasons described in this paragraph as of
    December&#160;31, 2009, he would have been entitled to receive a
    lump sum payment of $299,520, less taxes and withholdings, plus
    continuation of healthcare benefits with a value of $8,772.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In addition, if Mr.&#160;Finkelstein&#146;s employment is
    terminated without &#147;cause,&#148; or if there is a
    &#147;change in control&#148; event, in each case as defined in
    either the 2000 Plan or in Mr.&#160;Finkelstein&#146;s
    employment agreement, then the unvested portion of
    Mr.&#160;Finkelstein&#146;s options outstanding as of
    December&#160;31, 2009 would accelerate in full.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>C.&#160;Neil Lyons.</I>&#160;&#160;We entered into an
    employment agreement with Mr.&#160;Lyons in April 2007 for him
    to serve as our chief financial officer. Mr.&#160;Lyons&#146;
    employment agreement had an initial one-year term, which is
    automatically renewed for additional one-year periods unless
    either we or Mr.&#160;Lyons elect not to renew it. The agreement
    was amended and restated during 2008 and again in 2009. Under
    the employment agreement, as amended to date,
    Mr.&#160;Lyons&#146; base salary is $202,537. Mr.&#160;Lyons is
    also eligible to receive an annual bonus in an amount
    established by the board of directors and chief executive
    officer and is entitled to participate in and receive all
    standard employee benefits and to participate in all of our
    applicable incentive plans, including stock option, stock,
    bonus, savings and retirement plans. We also reimburse
    Mr.&#160;Lyons for two-thirds of his annual term life insurance
    premium, for term life insurance coverage not to exceed two
    times his annual base salary.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Mr.&#160;Lyons is eligible to receive options to purchase common
    stock under the 2000 Plan. The decision to grant any such
    options and the terms of such options are within the discretion
    of our board of directors or the compensation committee thereof.
    All vested options are exercisable for a period of time
    following any termination of Mr.&#160;Lyons&#146; employment as
    may be set forth in the 2000 Plan or in any option agreement
    between Mr.&#160;Lyons and us.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In the event that Mr.&#160;Lyons&#146; employment is terminated
    by us without &#147;cause&#148; as defined in his employment
    agreement, or if Mr.&#160;Lyons voluntarily terminates his
    employment within 12&#160;months following a &#147;change in
    control,&#148; as defined in his employment agreement, then in
    each case, subject to Mr.&#160;Lyons&#146; entering into and not
    revoking a release of claims in a form acceptable to us,
    Mr.&#160;Lyons will be entitled to receive (i)&#160;severance
    payments equal to his annual base salary then in effect, plus
    (ii)&#160;any earned bonus, and (iii)&#160;if he timely elects
    and remains eligible for continuation of healthcare benefits,
    that portion of the continued healthcare premiums that we were
    paying prior to the date of termination for a period of
    12&#160;months, in each
</DIV>
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    <BR>
    54
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    case less applicable taxes and withholdings. If
    Mr.&#160;Lyons&#146;s employment had been terminated for any of
    the reasons described in this paragraph as of December&#160;31,
    2009, he would have been entitled to receive severance payments
    of $202,537, less taxes and withholdings, plus continuation of
    healthcare benefits with a value of $17,208.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In addition, if Mr.&#160;Lyons&#146; employment is terminated
    without &#147;cause,&#148; or if there is a &#147;change in
    control&#148; event, in each case as defined in either the 2000
    Plan or in Mr.&#160;Lyons&#146; employment agreement, then the
    unvested portion of Mr.&#160;Lyons&#146; options to purchase
    350,000&#160;shares of common stock outstanding as of
    December&#160;31, 2009 would accelerate in full.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>David R. Crockford.</I>&#160;&#160;We entered into an
    employment agreement with Mr.&#160;Crockford in March 2005 for
    him to serve as our vice president of clinical and regulatory
    affairs. Mr.&#160;Crockford&#146;s employment agreement had an
    initial one-year term, which is automatically renewed for
    additional one-year periods unless either we or
    Mr.&#160;Crockford elect not to renew it. The agreement was
    amended and restated during 2008 and again in 2009. Under the
    employment agreement, as amended to date,
    Mr.&#160;Crockford&#146;s base salary is $210,223.
    Mr.&#160;Crockford is also eligible to receive an annual bonus
    in an amount established by the board of directors and chief
    executive officer and is entitled to participate in and receive
    all standard employee benefits and to participate in all of our
    applicable incentive plans, including stock option, stock,
    bonus, savings and retirement plans. We also reimburse
    Mr.&#160;Crockford for two-thirds of his annual term life
    insurance premium, for term life insurance coverage not to
    exceed two times his annual base salary.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Mr.&#160;Crockford is eligible to receive options to purchase
    common stock under the 2000 Plan. The decision to grant any such
    options and the terms of such options are within the discretion
    of our board of directors or the compensation committee thereof.
    All vested options are exercisable for a period of time
    following any termination of Mr.&#160;Crockford&#146;s
    employment as may be set forth in the 2000 Plan or in any option
    agreement between Mr.&#160;Crockford and us.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In the event that Mr.&#160;Crockford&#146;s employment is
    terminated by us without &#147;cause&#148; as defined in his
    employment agreement, or if Mr.&#160;Crockford voluntarily
    terminates his employment within 12&#160;months following a
    &#147;change in control,&#148; as defined in his employment
    agreement, then in each case, subject to
    Mr.&#160;Crockford&#146;s entering into and not revoking a
    release of claims in a form acceptable to us, Mr.&#160;Crockford
    will be entitled to receive (i)&#160;severance payments equal to
    his annual base salary then in effect, plus (ii)&#160;any earned
    bonus, and (iii)&#160;if he timely elects and remains eligible
    for continuation of healthcare benefits, that portion of the
    continued healthcare premiums that we were paying prior to the
    date of termination for a period of 12&#160;months, in each case
    less applicable taxes and withholdings. If
    Mr.&#160;Crockford&#146;s employment had been terminated for any
    of the reasons described in this paragraph as of
    December&#160;31, 2009, he would have been entitled to receive
    severance payments of $210,223, less taxes and withholdings,
    plus continuation of healthcare benefits with a value of
    $14,664. In addition, upon a &#147;change in control,&#148; all
    of Mr.&#160;Crockford&#146;s unvested options will accelerate in
    full, but there is no such acceleration upon a termination
    without cause.
</DIV>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    55
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<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Outstanding
    Equity Awards at December&#160;31, 2009</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table shows certain information regarding
    outstanding equity awards at December&#160;31, 2009 for the
    named executive officers, all of which were stock options.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="41%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="4%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="6%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="4%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="5%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=06 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=06 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Number of<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Shares<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Number of Shares<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Underlying<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Underlying<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Unexercised<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Unexercised<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Option<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Options (#)<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Options (#)<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Exercise Price<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Option<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Name</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Exercisable</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Unexercisable</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>($)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Expiration Date</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Note</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Mr. Finkelstein
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    500,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    0.33
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1/1/2012
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    100,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3.21
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4/1/2015
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    62,500
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    62,500
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2.34
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3/15/2014
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    31,250
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    93,750
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1.15
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4/15/2015
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    114,748
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    0.57
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4/10/2019
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    125,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    0.76
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    10/11/2016
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Mr. Lyons
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    133,332
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    66,668
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3.10
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4/7/2015
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (2
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    37,500
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    37,500
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2.34
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3/15/2014
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    18,750
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    56,250
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1.50
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6/15/2015
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    77,728
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    0.57
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4/10/2019
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    75,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    0.76
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    10/11/2016
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Mr. Crockford
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    15,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1.07
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7/1/2013
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    125,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    0.86
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1/1/2014
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    70,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    30,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3.21
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4/1/2015
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (3
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    17,500
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7,500
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3.82
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5/25/2015
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (3
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    25,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    25,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2.15
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1/16/2014
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    37,500
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    37,500
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2.34
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3/15/2014
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    18,750
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    56,250
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1.15
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4/15/2015
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    This option vests in equal installments on the first four
    anniversaries of the grant date. In each case these options were
    granted seven years prior to the listed expiration dates.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (2) </TD>
    <TD></TD>
    <TD valign="bottom">
    This option vests in equal installments on the first six
    anniversaries of the grant date which was April&#160;7, 2005.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (3) </TD>
    <TD></TD>
    <TD valign="bottom">
    This option vests on the first five anniversaries of the grant
    date in the following installments: 10%, 15%, 20%, 25%, 30%. In
    each case these options were granted ten years prior to the
    listed expiration dates.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Post-Employment
    Compensation</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We do not maintain any plans providing for payment or other
    benefits at, following, or in connection with retirement other
    than a 401(k) plan made available to all employees. In addition,
    we do not maintain any non-qualified deferred compensation plans.
</DIV>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    56
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Equity
    Compensation Plan Information</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table provides information as of December&#160;31,
    2009 about the securities authorized for issuance to our
    employees, directors and other eligible participants under our
    equity compensation plans, consisting solely of the 2000 Plan.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="31%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="16%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="20%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="19%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Number of Securities<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Remaining Available for<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Number of Securities to<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Future Issuance Under<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>be Issued Upon Exercise<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Weighted-Average Exercise<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Equity Compensation Plans<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>of Outstanding Options,<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Price of Outstanding Options,<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>(Excluding Securities<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Warrants and Rights<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Warrants and Rights<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Reflected in Column (a))<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Plan Category</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>(a)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>(b)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>(c)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Equity compensation plans approved by security holders
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,914,112
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1.53
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,550,888
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Equity compensation plans not approved by security holders
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Total
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,914,112
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1.53
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,550,888
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The 2000 Plan provides for grants of both incentive stock
    options and non-qualified stock options, as such terms are
    defined below, to participants. Participants in the 2000 Plan
    may include employees, directors, consultants and advisors of us
    and our affiliates. The 2000 Plan is administered by the
    Compensation Committee of the Board. Unless otherwise restricted
    by the Board, the Compensation Committee has the authority and
    discretion to select participants in the 2000 Plan and to grant
    options under the 2000 Plan. The Compensation Committee is
    authorized under the 2000 Plan to fix the terms and conditions
    of all option awards. The exercise price for options is
    determined by the Compensation Committee, provided that the
    exercise price cannot be less than the fair market value of a
    share on the date of grant of the option. In the case of an
    incentive stock option granted to a ten percent owner, the
    exercise price must be at least equal to 110% of the fair market
    value of a share on the date of grant. The Compensation
    Committee may set the term of each option granted under the 2000
    Plan, provided that the term cannot exceed ten years or five
    years in the case of an incentive stock option granted to a ten
    percent owner. The 2000 Plan also gives to the Compensation
    Committee the authority to determine vesting and exercisability
    of options granted under the 2000 Plan and to specify the method
    of payment of the exercise price.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    There are currently 6,500,000&#160;shares authorized for
    issuance under the 2000 Plan. Under the 2000 Plan, no single
    participant can receive options for more than
    750,000&#160;shares in any one year.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    For purposes of the 2000 Plan, fair market value is defined to
    mean the per share closing price of the shares on the securities
    exchange on which the shares are listed or, if no such price
    information is reported, the fair market value on such date of a
    share as the Compensation Committee shall determine. The 2000
    Plan generally provides that upon an option holder&#146;s
    termination of service for any reason other than for cause or
    due to death or disability, the option holder&#146;s options to
    the extent vested and exercisable can be exercised up until the
    earlier to occur of (i)&#160;three months following the
    termination of service or (ii)&#160;the expiration of the term
    of the option. Unless otherwise determined by the Compensation
    Committee, upon termination of service of an option holder due
    to death or disability, the option holder&#146;s options vested
    and exercisable can be exercised up until the earlier to occur
    of (i)&#160;one year following the termination of service on
    account of death or disability or (ii)&#160;the expiration of
    the term of the option. Upon termination of service of an option
    holder for cause (as defined by the 2000 Plan), all of the
    option holder&#146;s unexercised options shall immediately be
    forfeited.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The 2000 Plan provides that in certain events (including certain
    mergers or consolidations involving the Company), option holders
    may have the right to elect to receive cash upon exercise of any
    option equal to the fair market value of the underlying stock
    less the exercise price of such option times the number of
    shares with respect to which the options are option exercised.
    The Compensation Committee in its discretion will determine
    whether such amounts are to be paid in cash, property or some
    combination. The 2000 Plan also provides that upon the
    occurrence of certain events that are treated as a &#147;change
    in control,&#148; all outstanding
</DIV>
<!-- XBRL Paragraph Pagebreak -->
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    57
</DIV><!-- END PAGE WIDTH -->
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<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    options generally will become fully vested and exercisable
    (unless otherwise provided in an option holder&#146;s award
    agreement).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Options granted under the 2000 Plan are restricted as to
    transferability. Generally, options only may be transferred by
    will or the laws of descent and distribution, however,
    non-qualified stock options also may be transferred by gift
    under certain circumstances and pursuant to certain domestic
    relations orders. Option holders may be required under the 2000
    Plan to make certain investment representations in connection
    with the exercise of options to enable the Company to comply
    with federal and state securities laws. The Company may refuse
    delivery of shares under the 2000 Plan if the requested
    representations are not made by an option holder or if the
    shares have not been registered by the Company on a stock
    exchange. At the time of delivery of shares under the 2000 Plan,
    option holders may be required to pay any taxes associated with
    the exercise of the option that the Company is required to
    withhold. The 2000 Plan permits the Company to retain or sell
    shares that an option holder otherwise would receive upon
    exercise of the option to cover the tax amounts required to be
    withheld.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    No person has a right to be selected as a participant in the
    2000 Plan or to be granted an option under the 2000 Plan.
    Participation in the 2000 Plan or the grant of an option under
    the 2000 Plan does not give any participant or option holder
    rights as an employee of or a consultant or advisor to us or the
    right to be retained in the employ of or as a consultant or
    advisor to us.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Compensation Committee generally has the authority to amend,
    alter, suspend, discontinue, or terminate the 2000 Plan without
    the consent of stockholders or 2000 Plan participants. However,
    to the extent that an amendment to the 2000 Plan requires
    shareholder approval under any applicable federal or state law
    or regulation or the rules of any stock exchange, the
    Compensation Committee will seek stockholder approval. Unless
    otherwise terminated, the 2000 Plan will remain effective for a
    term of ten years from its effective date, or until
    December&#160;15, 2010. The Compensation Committee may not
    amend, alter, suspend, discontinue or terminate any outstanding
    option without the consent of the participant. We currently
    intend to adopt a new equity incentive plan and submit it to
    stockholders for approval during 2010.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Federal
    Income Tax Information</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Incentive Stock Options.</I>&#160;&#160;Incentive stock
    options under the 2000 Plan are intended to be eligible for the
    favorable federal income tax treatment accorded &#147;incentive
    stock options&#148; under the Internal Revenue Code of 1986, as
    amended (the &#147;Code&#148;).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    There generally are no federal income tax consequences to the
    participant or to us by reason of the grant or exercise of an
    incentive stock option. However, the exercise of an incentive
    stock option may increase the participant&#146;s alternative
    minimum tax liability, if any.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If a participant holds stock acquired through exercise of an
    incentive stock option for more than two years from the date on
    which the option is granted and more than one year from the date
    on which the shares are transferred to the participant upon
    exercise of the option, any gain or loss on a disposition of
    such stock will be a long-term capital gain or loss.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Generally, if the participant disposes of the stock before the
    expiration of either of these holding periods (a
    &#147;disqualifying disposition&#148;), then at the time of
    disposition the participant will realize taxable ordinary income
    equal to the lesser of (i)&#160;the excess of the stock&#146;s
    fair market value on the date of exercise over the exercise
    price, or (ii)&#160;the participant&#146;s actual gain, if any,
    on the purchase and sale. The participant&#146;s additional gain
    or any loss upon the disqualifying disposition will be a capital
    gain or loss, which will be long-term or short-term depending on
    whether the stock was held for more than one year.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    To the extent the participant recognizes ordinary income by
    reason of a disqualifying disposition, we will generally be
    entitled (subject to the requirement of reasonableness, the
    provisions of Section&#160;162(m) of the Code and the
    satisfaction of a tax reporting obligation) to a corresponding
    business expense deduction in the tax year in which the
    disqualifying disposition occurs.
</DIV>
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    58
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Nonstatutory Stock Options.</I>&#160;&#160;Nonstatutory stock
    options granted under the 2000 Plan generally have the following
    federal income tax consequences.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    There are no tax consequences to the participant or to us by
    reason of the grant. Upon acquisition of the stock, the
    participant normally will recognize taxable ordinary income
    equal to the excess, if any, of the stock&#146;s fair market
    value on the acquisition date over the purchase price. However,
    to the extent the stock is subject to certain types of vesting
    restrictions, the taxable event will be delayed until the
    vesting restrictions lapse unless the participant elects to be
    taxed on receipt of the stock. With respect to employees, we are
    generally required to withhold from regular wages or
    supplemental wage payments an amount based on the ordinary
    income recognized. Subject to the requirement of reasonableness,
    the provisions of Section&#160;162(m) of the Code and the
    satisfaction of a tax reporting obligation, we will generally be
    entitled to a business expense deduction equal to the taxable
    ordinary income realized by the participant.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Upon disposition of the stock, the participant will recognize a
    capital gain or loss equal to the difference between the selling
    price and the sum of the amount paid for such stock plus any
    amount recognized as ordinary income upon acquisition (or
    vesting) of the stock. Such gain or loss will be long-term or
    short-term depending on whether the stock was held for more than
    one year. Slightly different rules may apply to participants who
    acquire stock subject to certain repurchase options or who are
    subject to Section&#160;16(b) of the Exchange Act.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Potential Limitation on Company
    Deductions.</I>&#160;&#160;Section&#160;162(m) of the Code
    denies a deduction to any publicly held corporation for
    compensation paid to certain &#147;covered employees&#148; in a
    taxable year to the extent that compensation to such covered
    employee exceeds $1&#160;million. It is possible that
    compensation attributable to awards, when combined with all
    other types of compensation received by a covered employee from
    us, may cause this limitation to be exceeded in any particular
    year.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Certain kinds of compensation, including qualified
    &#147;performance-based compensation,&#148; are disregarded for
    purposes of the deduction limitation. In accordance with
    Treasury Regulations issued under Section&#160;162(m),
    compensation attributable to stock options will qualify as
    performance-based compensation if the award is granted by a
    compensation committee comprise solely of &#147;outside
    directors&#148; and either (i)&#160;the plan contains a
    per-employee limitation on the number of shares for which such
    awards may be granted during a specified period, the
    per-employee limitation is approved by the stockholders, and the
    exercise price of the award is no less than the fair market
    value of the stock on the date of grant, or (ii)&#160;the award
    is granted (or exercisable) only upon the achievement (as
    certified in writing by the compensation committee) of an
    objective performance goal established in writing by the
    compensation committee while the outcome is substantially
    uncertain, and the award is approved by stockholders.
</DIV>
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    <BR>
    59
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<A name='113'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">CERTAIN
    RELATIONSHIPS AND RELATED PARTY TRANSACTIONS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following is a summary of transactions, and series of
    related transactions, since January&#160;1, 2007 to which we
    have been or will be a participant, in which the amount involved
    exceeded or will exceed one percent of the average of our total
    assets at year end for the last two completed fiscal years and
    in which any of our executive officers, directors or beneficial
    holders of more than five percent of our capital stock had or
    will have a direct or indirect material interest, or any
    immediate family member of, or person sharing the household
    with, any of these individuals, had or will have a direct or
    indirect material interest, other than executive and director
    compensation arrangements, including the employment, termination
    of employment and change of control arrangements, which are
    described in the section of this prospectus entitled
    &#147;Executive Compensation.&#148;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Since January&#160;1, 2007, we have entered into four financing
    transactions with Sigma-Tau and its affiliates as described
    below. As described above, Mauro Bove, one of our directors, is
    an officer of Sigma-Tau. Each of these transactions was approved
    by our Board of Directors and our audit committee, following
    disclosure of Mr.&#160;Bove&#146;s potential interests in these
    transactions.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    On February&#160;29, 2008, we issued 2,500,000&#160;shares of
    common stock to each of Chaumiere-Consultadoria e Servicos SDC
    Unipessoal LDA, or Chaumiere, which is an indirect wholly-owned
    subsidiary of an entity owned by Paolo Cavazza and members of
    his family, who own 38% of Sigma-Tau, and
    Inverlochy-Consultadoria e Servicos (S.U.) LDA, or Inverlochy,
    an entity wholly owned by Claudio Cavazza, who directly and
    indirectly owns 57% of Sigma-Tau, at a purchase price of $1.00
    per share in a private placement. The purchase agreements
    provide that the purchasers may not transfer the shares through
    December&#160;31, 2010, except for transfers to affiliates, that
    we, rather than the purchasers, have all voting rights in
    respect of the shares until December&#160;31, 2010, and that we
    had the right to repurchase the shares at a price of $2.00 per
    share until December&#160;31, 2009, which right has expired, and
    that we have the right to repurchase the shares at a price of
    $2.50 per share until December&#160;31, 2010. We also issued
    warrants to each of Chaumiere and Inverlochy to purchase
    500,000&#160;shares of our common stock at an exercise price of
    $1.60 per share. The warrants have vested in full as of
    December&#160;31, 2009 and are exercisable until
    December&#160;31, 2010.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    On December&#160;10, 2008, we issued 1,034,482&#160;shares of
    common stock to each of Chaumiere and Inverlochy at a purchase
    price of $1.45 per share in a private placement. The purchase
    agreements provide that the purchasers may not transfer the
    shares through December&#160;31, 2011, except for transfers to
    affiliates and that we, rather than the purchasers, have all
    voting rights in respect of the shares until December&#160;31,
    2011. We also issued warrants to each of Chaumiere and
    Inverlochy to purchase 372,552&#160;shares of our common stock
    at an exercise price of $1.74 per share. The warrants were
    vested in full upon issuance and are exercisable until
    December&#160;31, 2011.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    On April&#160;30, 2009, we issued 1,052,631&#160;shares of
    common stock to Chaumiere at a purchase price of $0.57 per share
    in a private placement. The purchase agreement provides that
    Chaumiere may not transfer the shares through April&#160;30,
    2012 except for transfers to affiliates and that we, rather than
    Chaumiere, have all voting rights in respect to the shares
    through April&#160;30, 2012. We also issued a warrant to
    Chaumiere to purchase 263,158&#160;shares of our common stock at
    an exercise price of $0.91 per share. The warrant was fully
    vested upon issuance and is exercisable until April&#160;30,
    2012.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    On October&#160;15, 2009, we issued 1,219,512&#160;shares of
    common stock to Chaumiere at a purchase price of $0.82 per share
    in a private placement. The purchase agreement provides that
    Chaumiere may not transfer the shares through September&#160;30,
    2012 except for transfers to affiliates and that we, rather than
    Chaumiere, have all voting rights in respect to the shares
    through September&#160;30, 2012. We also issued a warrant to
    Chaumiere to purchase 609,756&#160;shares of our common stock at
    an exercise price of $1.12 per share. The warrant was fully
    vested upon issuance and is exercisable until September&#160;30,
    2014.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Indemnification
    of Officers and Directors</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our restated certificate of incorporation limits the personal
    liability of directors for breach of fiduciary duty to the
    maximum extent permitted by the General Corporation Law of the
    State of Delaware, referred to herein as the DGCL. Our restated
    certificate of incorporation provides that no director will have
    personal
</DIV>
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    <BR>
    60
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    liability to us or to our stockholders for monetary damages for
    breach of fiduciary duty as a director. However, these
    provisions do not eliminate or limit the liability of any of our
    directors for any of the following:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any breach of their duty of loyalty to us or our stockholders;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    acts or omissions not in good faith or which involve intentional
    misconduct or a knowing violation of law;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    voting or assenting to unlawful payments of dividends or other
    distributions;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any transaction from which the director derived an improper
    personal benefit.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Any amendment to or repeal of these provisions will not
    eliminate or reduce the effect of these provisions in respect of
    any act or failure to act, or any cause of action, suit or claim
    that would accrue or arise prior to any amendment or repeal or
    adoption of an inconsistent provision. If the DGCL is amended to
    provide for further limitations on the personal liability of
    directors of corporations, then the personal liability of our
    directors will be further limited in accordance with the DGCL.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Section&#160;145 of the DGCL provides that a Delaware
    corporation may indemnify any persons who are, or are threatened
    to be made, parties to any threatened, pending or completed
    action, suit or proceeding, whether civil, criminal,
    administrative or investigative (other than an action by or in
    the right of such corporation), by reason of the fact that such
    person was an officer, director, employee or agent of such
    corporation, or is or was serving at the request of such person
    as an officer, director, employee or agent of another
    corporation or enterprise. Our amended and restated bylaws
    include such a provision. The indemnity may include expenses
    (including attorneys&#146; fees), judgments, fines and amounts
    paid in settlement actually and reasonably incurred by such
    person in connection with such action, suit or proceeding,
    provided that such person acted in good faith and in a manner he
    or she reasonably believed to be in or not opposed to the
    corporation&#146;s best interests and, with respect to any
    criminal action or proceeding, had no reasonable cause to
    believe that his or her conduct was unlawful.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Section&#160;145 of the DGCL also provides that a Delaware
    corporation may indemnify any persons who are, or are threatened
    to be made, a party to any threatened, pending or completed
    action or suit by or in the right of the corporation by reason
    of the fact that such person was a director, officer, employee
    or agent of such corporation, or is or was serving at the
    request of such corporation as a director, officer, employee or
    agent of another corporation or enterprise. Our amended and
    restated bylaws contain such a provision. The indemnity may
    include expenses (including attorneys&#146; fees) actually and
    reasonably incurred by such person in connection with the
    defense or settlement of such action or suit provided such
    person acted in good faith and in a manner he or she reasonably
    believed to be in or not opposed to the corporation&#146;s best
    interests except that no indemnification is permitted without
    judicial approval if the officer or director is adjudged to be
    liable to the corporation. Where an officer or director is
    successful on the merits or otherwise in the defense of any
    action referred to above, the corporation must indemnify him or
    her against the expenses that such officer or director has
    actually and reasonably incurred.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Expenses incurred by any indemnitee in defending or
    investigating a threatened or pending action, suit or proceeding
    in advance of its final disposition shall be paid by us upon
    delivery to us of an undertaking, by or on behalf of such
    indemnitee, to repay all amounts so advanced if it shall
    ultimately be determined that such indemnitee is not entitled to
    be indemnified by us. No advance will be made by us if a
    determination is reasonably and promptly made by our board of
    directors by a majority vote of a quorum of disinterested
    directors, or if such a quorum is not obtainable or, even if
    obtainable, a quorum of disinterested directors so directs, by
    independent legal counsel in a written opinion, that, based upon
    the facts known to the board or counsel at the time such
    determination is made, such person did not meet the applicable
    standard of conduct in order to be indemnified.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    At present, there is no pending litigation or proceeding
    involving any of our directors or officers as to which
    indemnification is required or permitted, and we are not aware
    of any threatened litigation or proceeding that may result in a
    claim for indemnification.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have an insurance policy covering our officers and directors
    with respect to certain liabilities, including liabilities
    arising under the Securities Act or otherwise.
</DIV>
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    <BR>
    61
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<A name='114'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">PRINCIPAL
    STOCKHOLDERS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table sets forth the beneficial ownership of our
    common stock as of March&#160;15, 2010 and as adjusted to
    reflect the sale of shares in this offering by:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    each person, or group of affiliated persons, who is known by us
    to beneficially own more than 5% of our common stock;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    each of our named executive officers;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    each of our directors;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    all of our executive officers and directors as a group.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The percentage ownership information shown in the table is based
    upon 60,406,828&#160;shares of common stock outstanding as of
    March&#160;15, 2010.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have determined beneficial ownership in accordance with the
    rules of the SEC. These rules generally attribute beneficial
    ownership of securities to persons who possess sole or shared
    voting power or investment power with respect to those
    securities. In addition, the rules include shares of common
    stock issuable pursuant to the exercise of stock options or
    warrants that are either immediately exercisable or exercisable
    on or before May&#160;14, 2010, which is 60&#160;days after
    March&#160;15, 2010. These shares are deemed to be outstanding
    and beneficially owned by the person holding those options or
    warrants for the purpose of computing the percentage ownership
    of that person, but they are not treated as outstanding for the
    purpose of computing the percentage ownership of any other
    person. Unless otherwise indicated, the persons or entities
    identified in this table have sole voting and investment power
    with respect to all shares shown as beneficially owned by them,
    subject to applicable community property laws.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Except as otherwise noted below, the address for persons listed
    in the table is
    <FONT style="white-space: nowrap">c/o&#160;RegeneRx</FONT>
    Biopharmaceuticals, Inc., 15245 Shady Grove Road,
    Suite&#160;470, Rockville, Maryland 20850.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="73%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="4%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Number of<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" nowrap align="center" valign="bottom">
    <B>Percentage of Shares<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Shares<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Beneficially Owned</B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Beneficially<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Before<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>After<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Name of Beneficial Owner</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Owned</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Offering</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Offering</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <I>5% Stockholders:</I>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Entities affiliated with Sigma-Tau Finanziaria, S.p.A. Via
    Sudafrica, 20, Rome, Italy 00144
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    30,142,859
</TD>
<TD nowrap align="left" valign="bottom">
    (1)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    46.9
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <I>Named Executive Officers and Directors:</I>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    J.J. Finkelstein
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,299,636
</TD>
<TD nowrap align="left" valign="bottom">
    (2)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3.8
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Allan L. Goldstein
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,152,538
</TD>
<TD nowrap align="left" valign="bottom">
    (3)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3.6
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Richard J. Hindin
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,175,459
</TD>
<TD nowrap align="left" valign="bottom">
    (4)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1.9
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Joseph C. McNay
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,537,135
</TD>
<TD nowrap align="left" valign="bottom">
    (5)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2.5
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Mauro Bove
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    197,155
</TD>
<TD nowrap align="left" valign="bottom">
    (6)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    *
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    *
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    L. Thompson Bowles
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    124,843
</TD>
<TD nowrap align="left" valign="bottom">
    (7)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    *
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    *
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    C. Neil Lyons
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    329,393
</TD>
<TD nowrap align="left" valign="bottom">
    (8)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    *
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    *
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    David R. Crockford
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    388,750
</TD>
<TD nowrap align="left" valign="bottom">
    (9)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    *
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    *
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    All current directors and executive officers as a group
    (8&#160;persons)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    38,347,768
</TD>
<TD nowrap align="left" valign="bottom">
    (10)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    63.7
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    *&#160;</TD>
    <TD></TD>
    <TD valign="bottom">
    Represents beneficial ownership of less than 1%.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    Consists of 984,615&#160;shares of common stock held of record
    held by Sigma-Tau Finanziaria, S.p.A. (&#147;Sigma-Tau&#148;);
    12,011,185&#160;shares of common stock held of record and
    589,481&#160;shares of common stock issuable upon exercise of
    warrants held by Defiante Farmaceutica S.A.
    (&#147;Defiante&#148;), a subsidiary of Sigma-Tau, that are
    exercisable within 60&#160;days of March&#160;15, 2010;
    5,052,582&#160;shares of common stock held of record and
    1,228,486&#160;shares of common stock issuable upon exercise of
    warrants held by Inverlochy-Consultadoria e Servicos (S.U.) LDA
    (&#147;Inverlochy&#148;), an entity wholly owned by Claudio
    Cavazza, </TD>
</TR>
<!-- XBRL Paragraph Pagebreak -->

</TABLE>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    62
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<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR>
    <TD valign="top">
</TD>
    <TD></TD>
    <TD valign="bottom">
    who directly and indirectly owns 57% of Sigma-Tau, that are
    exercisable within 60&#160;days of March&#160;15, 2010; and
    8,175,110&#160;shares of common stock held of record and
    2,101,400&#160;shares of common stock issuable upon exercise of
    warrants held by Chaumiere-Consultadoria e Servicos SDC
    Unipessoal LDA (&#147;Chaumiere&#148;), an indirect wholly-owned
    subsidiary of Aptafin S.p.A., which is owned by Paolo Cavazza
    and members of his family, that are exercisable within
    60&#160;days of March&#160;15, 2010. Paolo Cavazza directly and
    indirectly owns 38% of Sigma-Tau.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (2) </TD>
    <TD></TD>
    <TD valign="bottom">
    Consists of 1,377,638&#160;shares of common stock held of record
    by Mr.&#160;Finkelstein and 51,000&#160;shares of common stock
    held of record by Mr.&#160;Finkelstein&#146;s minor daughter
    over which Mr.&#160;Finkelstein shares voting and dispositive
    power. Also includes 870,998&#160;shares of common stock
    issuable upon exercise of options exercisable within
    60&#160;days of March&#160;15, 2010.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (3) </TD>
    <TD></TD>
    <TD valign="bottom">
    Consists of 1,586,846&#160;shares of common stock held of record
    by Dr.&#160;Goldstein and 565,692&#160;shares of common stock
    issuable upon exercise of options exercisable within
    60&#160;days of March&#160;15, 2010.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (4) </TD>
    <TD></TD>
    <TD valign="bottom">
    Consists of 967,710&#160;shares of common stock held of record
    by Mr.&#160;Hindin and 207,749&#160;shares of common stock
    issuable upon exercise of options exercisable within
    60&#160;days of March&#160;15, 2010.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (5) </TD>
    <TD></TD>
    <TD valign="bottom">
    Consists of 1,339,111&#160;shares of common stock held of record
    by Mr.&#160;McNay and 198,024&#160;shares of common stock
    issuable upon exercise of options exercisable within
    60&#160;days of March&#160;15, 2010.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (6) </TD>
    <TD></TD>
    <TD valign="bottom">
    Consists of shares of common stock issuable upon exercise of
    options exercisable within 60&#160;days of March&#160;15, 2010.
    Mr.&#160;Bove is an officer of Sigma-Tau, but he has no
    beneficial ownership over the reported securities as he has no
    voting or dispositive power with respect to the securities held
    by Sigma-Tau and its affiliates described in Note&#160;2 above.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (7) </TD>
    <TD></TD>
    <TD valign="bottom">
    Consists of shares of common stock issuable upon exercise of
    options exercisable within 60&#160;days of March&#160;15, 2010.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (8) </TD>
    <TD></TD>
    <TD valign="bottom">
    Consists of 10,000&#160;shares of common stock held of record by
    Mr.&#160;Lyons and 319,393&#160;shares of common stock issuable
    upon exercise of options exercisable within 60&#160;days of
    March&#160;15, 2010.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (9) </TD>
    <TD></TD>
    <TD valign="bottom">
    Consists of shares of common stock issuable upon exercise of
    options exercisable within 60&#160;days of March&#160;15, 2010.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (10) </TD>
    <TD></TD>
    <TD valign="bottom">
    Consists of 31,555,797&#160;shares of common stock held of
    record, 3,919,367&#160;shares of common stock issuable upon
    exercise of warrants exercisable within 60&#160;days of
    March&#160;15, 2010 and 2,872,604&#160;shares of common stock
    issuable upon exercise of options exercisable within
    60&#160;days of March&#160;15, 2010.</TD>
</TR>

</TABLE>
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    <BR>
    63
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<A name='115'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">DESCRIPTION
    OF SECURITIES</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As of the date of this prospectus, our certificate of
    incorporation authorizes us to issue 100,000,000&#160;shares of
    common stock, par value $0.001 per share, and
    1,000,000&#160;shares of preferred stock, par value $0.001 per
    share. As of March&#160;31, 2010, 60,406,828&#160;shares of
    common stock were outstanding and no shares of preferred stock
    were outstanding. Depending on the number of shares to be issued
    in this offering, we may be required to effect an amendment to
    our restated certificate of incorporation in order to increase
    the authorized number of shares of common stock.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As of March&#160;31, 2010, we also had outstanding:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    options to purchase 4,914,112&#160;shares of our common stock at
    a weighted average exercise price of $1.53 per share;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    warrants to purchase an aggregate of 7,933,851&#160;shares of
    our common stock at a weighted average exercise price of $2.01
    per share.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following summary description of our capital stock is based
    on the provisions of our certificate of incorporation, including
    the certificate of designation for our Series&#160;A
    Participating Cumulative Preferred Stock described below, as
    well as our bylaws, our stockholder rights plan and the
    applicable provisions of the Delaware General Corporation Law.
    This information is qualified entirely by reference to the
    applicable provisions of our restated certificate of
    incorporation, as amended to date, our bylaws, as amended to
    date, our stockholder rights plan and the Delaware General
    Corporation Law. For information on how to obtain copies of our
    certificate of incorporation, bylaws and stockholder rights
    plan, which are exhibits to the registration statement of which
    this prospectus is a part, see &#147;Where You Can Find
    Additional Information.&#148;
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Units</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In this offering, we are
    offering&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
    units, consisting
    of&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock and warrants to
    purchase&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock. Each unit consists
    of&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock and a tradeable warrant to
    purchase&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock. The units will separate immediately and the
    common stock and the warrants will be issued separately. There
    will be no market for the units. We are also issuing warrants to
    purchase up to an aggregate
    of&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of our common stock at an exercise price of
    $&#160;&#160;&#160;&#160;&#160; per share to the underwriters as
    underwriting compensation. The terms of these underwriters&#146;
    warrants are summarized below under
    &#147;Underwriting&#160;&#151; Underwriters&#146;
    Warrants.&#148; This prospectus also relates to the offering of
    shares of our common stock upon exercise, if any, of the
    warrants.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Common
    Stock</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Voting Rights.</I>&#160;&#160;Each holder of our common stock
    is entitled to one vote for each share on all matters submitted
    to a vote of the stockholders, including the election of
    directors. Our certificate of incorporation and bylaws do not
    provide for cumulative voting rights. Because of this, the
    holders of a majority of the shares of common stock entitled to
    vote in any election of directors can elect all of the directors
    standing for election, if they should so choose.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Dividends.</I>&#160;&#160;Subject to preferences that may be
    applicable to any then outstanding preferred stock, holders of
    common stock are entitled to receive dividends, if any, as may
    be declared from time to time by our board of directors out of
    legally available funds.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Liquidation.</I>&#160;&#160;In the event of our liquidation,
    dissolution or winding up, holders of common stock will be
    entitled to share ratably in the net assets legally available
    for distribution to stockholders after the payment of all of our
    debts and other liabilities and the satisfaction of any
    liquidation preference granted to the holders of any then
    outstanding shares of preferred stock.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Rights and Preferences.</I>&#160;&#160;Holders of common
    stock have no preemptive, conversion, subscription or other
    rights, and there are no redemption or sinking fund provisions
    applicable to the common stock. The rights, preferences and
    privileges of the holders of common stock are subject to and may
    be adversely affected by, the rights of the holders of shares of
    any series of preferred stock that we may designate in the
    future.
</DIV>
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    <BR>
    64
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Fully Paid and Nonassessable.</I>&#160;&#160;All of our
    outstanding shares of common stock are, and the shares of common
    stock to be issued in this offering will be, fully paid and
    nonassessable.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Certain Repurchase Rights and Voting Restrictions.</I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    On October&#160;15, 2009, we issued 1,219,512&#160;shares of
    common stock and a warrant to purchase an additional
    609,756&#160;shares of common stock to Sigma-Tau. The purchaser
    agreed to vote the shares purchased in the transaction, and any
    additional shares issued pursuant to the exercise of the warrant
    issued in the transaction, at the direction of our Board until
    September&#160;30, 2012.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    On April&#160;30, 2009, we issued 1,052,631&#160;shares of
    common stock and a warrant to purchase an additional
    263,158&#160;shares of common stock to Sigma-Tau. The purchaser
    agreed to vote the shares purchased in the transaction, and any
    additional shares issued pursuant to the exercise of the warrant
    issued in the transaction, at the direction of our Board until
    April&#160;30, 2012.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    On December&#160;10, 2008, we issued an aggregate of
    2,068,964&#160;shares of common stock and warrants to purchase
    an additional 745,104&#160;shares of common stock to Sigma-Tau.
    The purchasers agreed to vote the shares purchased in the
    transaction, and any additional shares issued pursuant to the
    exercise of the warrants issued in the transaction, at the
    direction of our Board until December&#160;31, 2011.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    On February&#160;29, 2008, we issued an aggregate of
    5,000,000&#160;shares of common stock and warrants to purchase
    an additional 1,000,000&#160;shares of common stock to
    Sigma-Tau. We may, in our sole discretion, repurchase the shares
    issued in the transaction at any time until December&#160;31,
    2010 for $2.50 per share. In addition, the purchasers agreed to
    vote the shares purchased in the transaction, and any additional
    shares issued pursuant to the exercise of the warrants issued in
    the transaction, at the direction of our Board until
    December&#160;31, 2010.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    On June&#160;23, 2005, we issued an aggregate of
    1,538,461&#160;shares of common stock to Sigma-Tau. The
    purchasers agreed to assign the right to vote the shares issued
    in the transaction to us until June&#160;23, 2010. At the end of
    this period, we, in our sole discretion, may repurchase for
    $5.00 per share the number of shares required to reduce the
    aggregate equity ownership of the purchasers to 30.1% of our
    outstanding common stock.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Warrants
    to Be Issued as Part of the Units</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The material terms and provisions of the warrants being offered
    pursuant to this prospectus are summarized below. This summary
    is subject to, and qualified in its entirety by, the form of
    warrant agreement and warrant certificate included as exhibits
    to the registration statement filed with the SEC of which this
    prospectus is a part. You should review copies of these items
    for a complete description of the terms and conditions
    applicable to the warrants.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Each warrant entitles the registered holder to purchase one
    share of our common stock at a price equal to
    $&#160;&#160;&#160;&#160;&#160;, which represents 110% of the
    closing bid price of our common stock on the date of this
    prospectus. The warrants may only be exercised for cash. The
    warrants will expire five years from the date of this prospectus
    at 5:00&#160;p.m., New York City time.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We may call the warrants for redemption as follows:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    at a price of $0.01 per share for each warrant at any time while
    the warrants are exercisable, so long as a registration
    statement relating to the common stock issuable upon exercise of
    the warrants is effective and current;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    upon not less than 30&#160;days&#146; prior written notice of
    redemption to each warrant holder;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    if, and only if, the last reported sale price of the common
    stock equals or exceeds $&#160;&#160;&#160;&#160;&#160; per
    share for any 20 trading days within a period of 30 consecutive
    trading days.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If the foregoing conditions are satisfied and we call the
    warrants for redemption, each warrant holder will then be
    entitled to exercise his or her warrant prior to the date
    scheduled for redemption. However, there can
</DIV>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    be no assurance that the price of the common stock will exceed
    the call price or the warrant exercise price after the
    redemption call is made.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The warrants will be issued in registered form under a warrant
    agreement between American Stock Transfer&#160;&#038;
    Trust&#160;Company, as warrant agent, and us. We intend to apply
    for listing of the warrants on the NYSE Amex under the symbol
    &#147;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;.&#148;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The exercise price and number of shares of common stock issuable
    on exercise of the warrants may be adjusted in certain
    circumstances, including but not limited to in the event of a
    stock split, stock dividend, recapitalization, reorganization,
    merger or consolidation. However, the warrants will not be
    adjusted for the issuances of common stock or securities
    convertible or exercisable into common stock at a price below
    their respective exercise prices.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The warrants may be exercised upon surrender of the warrant
    certificate on or prior to the expiration date at the offices of
    the warrant agent, with the exercise form on the reverse side of
    the warrant certificate completed and executed as indicated,
    accompanied by full payment of the exercise price, by certified
    check payable to us, for the number of warrants being exercised.
    The warrant holders do not have the rights or privileges of
    holders of common stock and any voting rights until they
    exercise their warrants and received shares of common stock.
    After issuance of shares of common stock upon exercise of the
    warrants, each holder will be entitled to one vote for each
    share held of record on all matters to be voted on by
    stockholders.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    No warrants will be exercisable unless at the time of exercise a
    prospectus relating to common stock issuable upon exercise of
    the warrants is current and the common stock has been registered
    or qualified or deemed to be exempt under the securities laws of
    the state of residence of the holder of the warrants. Under the
    terms of the warrant agreement, we have agreed to meet these
    conditions and use our best efforts to maintain a current
    prospectus relating to common stock issuable upon exercise of
    the warrants until the expiration of the warrants. However, we
    cannot assure you that we will be able to do so, and if we do
    not maintain a current prospectus related to the common stock
    issuable upon exercise of the warrants, holders will be unable
    to exercise their warrants and we will not be required to settle
    any such warrant exercise. If the prospectus relating to the
    common stock issuable upon the exercise of the warrants is not
    current or if the common stock is not qualified or exempt from
    qualification in the jurisdictions in which the holders of the
    warrants reside, we will not be required to net cash settle or
    cash settle the warrant exercise, the warrants may have no
    value, the market for the warrants may be limited and the
    warrants may expire worthless.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Preferred
    Stock</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Under our certificate of incorporation, our board of directors
    has the authority, without further action by the stockholders,
    to issue up to 1,000,000&#160;shares of preferred stock in one
    or more series, to establish from time to time the number of
    shares to be included in each such series, to fix the rights,
    preferences and privileges of the shares of each wholly unissued
    series and any qualifications, limitations or restrictions
    thereon and to increase or decrease the number of shares of any
    such series, but not below the number of shares of such series
    then outstanding. Our board of directors has designated 200,000
    of the 1,000,000 authorized shares of preferred stock as
    Series&#160;A Participating Cumulative Preferred Stock, none of
    which shares are outstanding but which could be issued under the
    terms of the stockholder rights plan.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our board of directors may authorize the issuance of preferred
    stock with voting or conversion rights that could adversely
    affect the voting power or other rights of the holders of the
    common stock. The issuance of preferred stock, while providing
    flexibility in connection with possible acquisitions and other
    corporate purposes, could, among other things, have the effect
    of delaying, deferring or preventing a change in control of our
    company and may adversely affect the market price of the common
    stock and the voting and other rights of the holders of common
    stock.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Stockholder Rights Plan.</I>&#160;&#160;Our Board adopted a
    Rights Agreement, dated April&#160;29, 1994, as amended, often
    referred to as a &#147;poison pill,&#148; as a tool to prevent
    an unsolicited takeover. In general, under our rights agreement,
    our Board has the discretion to issue certain rights to purchase
    our capital stock when a person acquires in excess of 25% of our
    outstanding common shares. These provisions may make it more
    difficult for
</DIV>
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    66
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    stockholders to take corporate actions and may have the effect
    of delaying or preventing a change in control, even if such
    actions or change in control would be in your best interests.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Delaware
    Anti-takeover Law and Certain Provisions of Our Amended and
    Restated Certificate of Incorporation and Bylaws</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Delaware law.</I>&#160;&#160;We are subject to
    Section&#160;203 of the Delaware General Corporation Law.
    Section&#160;203 generally prohibits a public Delaware
    corporation from engaging in a business combination with an
    interested stockholder for a period of three years after the
    date of the transaction in which the person became an interested
    stockholder, unless:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    prior to the date of the transaction, the board of directors of
    the corporation approved either the business combination or the
    transaction that resulted in the stockholder becoming an
    interested stockholder;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the interested stockholder owned at least 85% of the voting
    stock of the corporation outstanding at the time the transaction
    commenced, excluding for this purpose shares owned by persons
    who are directors and also officers and shares owned by employee
    stock plans in which employee participants do not have the right
    to determine confidentially whether shares held subject to the
    plan will be tendered in a tender or exchange offer;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    on or subsequent to the date of the transaction, the business
    combination is approved by the board and authorized at an annual
    or special meeting of stockholders, and not by written consent,
    by the affirmative vote of at least
    66<FONT style="vertical-align: text-top; font-size: 70%;">2</FONT>/<FONT style="font-size: 70%;">3</FONT>%
    of the outstanding voting stock that is not owned by the
    interested stockholder.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Section&#160;203 defines a business combination to include:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any merger or consolidation involving the corporation and the
    interested stockholder;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any sale, transfer, pledge or other disposition involving the
    interested stockholder of 10% or more of the assets of the
    corporation;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    subject to exceptions, any transaction that results in the
    issuance or transfer by the corporation of any stock of the
    corporation to the interested stockholder;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any transaction involving the corporation that has the effect of
    increasing the proportionate share of the stock or any class or
    series of the corporation beneficially owned by the interested
    stockholder;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the receipt by the interested stockholder of the benefit of any
    loans, advances, guarantees, pledges or other financial benefits
    provided by or through the corporation.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In general, Section&#160;203 defines an interested stockholder
    as any entity or person beneficially owning 15% or more of the
    outstanding voting stock of the corporation and any entity or
    person affiliated with or controlling or controlled by the
    entity or person.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Certificate of Incorporation and
    Bylaws.</I>&#160;&#160;Provisions of our restated certificate of
    incorporation and amended and restated bylaws may delay or
    discourage transactions involving an actual or potential change
    in our control or change in our management, including
    transactions in which stockholders might otherwise receive a
    premium for their shares, or transactions that our stockholders
    might otherwise deem to be in their best interests. Therefore,
    these provisions could adversely affect the price of our common
    stock.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Among other things, our restated certificate of incorporation
    and amended and restated bylaws:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    permit our board of directors to issue up to
    1,000,000&#160;shares of preferred stock, with any rights,
    preferences and privileges as they may designate, including the
    right to approve an acquisition or other change in our control;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    provide that the authorized number of directors, which may not
    be less than three nor more than seven, may be changed only by
    resolution of the board of directors;
</TD>
</TR>

</TABLE>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    67
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    provide that stockholders seeking to present proposals before a
    meeting of stockholders or to nominate candidates for election
    as directors at a meeting of stockholders must provide notice in
    writing in a timely manner, and also specify requirements as to
    the form and content of a stockholder&#146;s notice;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    do not provide for cumulative voting rights, therefore allowing
    the holders of a majority of the shares of common stock entitled
    to vote in any election of directors to elect all of the
    directors standing for election, if they should so
    choose;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    provide that special meetings of our stockholders may be called
    only by the chairman of the board, our chief executive officer
    or by the board of directors.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Transfer
    Agent and Registrar</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The transfer agent and registrar for our common stock is
    American Stock Transfer&#160;&#038; Trust&#160;Company. The
    transfer agent and registrar&#146;s address is 6201
    15th&#160;Street, Brooklyn, NY 11219.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">NYSE Amex
    Listing</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our common stock is currently listed on the NYSE Amex under the
    trading symbol &#147;RGN.&#148;
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    68
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<A name='116'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">UNDERWRITING</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Subject to the terms and conditions of the underwriting
    agreement between us and Maxim Group LLC, the sole book-running
    manager and sole representative of the underwriters, each
    underwriter named below has severally agreed to purchase from us
    on a firm commitment basis the following respective number of
    units of common stock and warrants to purchase common stock
    opposite its name below, at the public offering price less the
    underwriting discounts and commissions set forth on the cover
    page of this prospectus:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="85%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="11%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Underwriter</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Number of Units</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Maxim Group LLC
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Boenning&#160;&#038; Scattergood, Inc.
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 40pt">
    Total
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The underwriting agreement provides for the purchase of a
    specific number of units by each of the underwriters. The
    underwriters&#146; obligations are several, which means that
    each underwriter is required to purchase a specified number of
    units, but is not responsible for the commitment of any other
    underwriter to purchase units.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Subject to the terms of the underwriting agreement, the
    underwriters have agreed to purchase all of the units offered by
    this prospectus (other than those covered by the over-allotment
    option described below) if any are purchased. Under the
    underwriting agreement, if an underwriter defaults in its
    commitment to purchase units, the commitments of non-defaulting
    underwriters may be increased or the underwriting agreement may
    be terminated, depending on the circumstances. The underwriting
    agreement provides that the obligations of the underwriters to
    pay for and accept delivery of the units are subject to the
    passing upon certain legal matters by counsel and to certain
    other conditions, such as confirmation of the accuracy of our
    representations and warranties made in the underwriting
    agreement about our financial condition and operations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have been advised by the representative of the underwriters
    that the underwriters propose to offer the units to the public
    at the public offering price set forth on the cover of this
    prospectus and to dealers at a price that represents a
    concession not in excess of $&#160;&#160;&#160;&#160;&#160; per
    unit. The underwriters may allow, and these dealers may
    re-allow, a concession of not more than
    $&#160;&#160;&#160;&#160;&#160; per unit to other dealers. After
    the securities are released for sale to the public, the
    underwriters may change the offering price and other selling
    terms at various times.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Commissions
    and Expenses</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table summarizes the underwriting discounts and
    commissions we will pay to the underwriters.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="61%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="6%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="6%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Total Without<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Total With<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Fee per<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Exercise of<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Exercise of<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Unit(2)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Over-Allotment</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Over-Allotment</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Public offering price
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Underwriting discount(1)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Proceeds, before expenses, to us
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">

</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    Does not include a corporate finance fee in the amount of 1% of
    the gross proceeds payable to the representative of the
    underwriters for structuring the terms of the offering.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (2) </TD>
    <TD></TD>
    <TD valign="bottom">
    The fees shown do not include the warrants to purchase shares of
    common stock issuable to the representative of the underwriters
    at the closing.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We estimate that the total expenses of the offering, including
    registration, filing and listing fees, printing fees, legal and
    accounting expenses and transfer and warrant agent fees, but
    excluding underwriting discounts and commissions, and not taking
    into account the underwriters&#146; over-allotment option, will
    be approximately $&#160;&#160;&#160;&#160;&#160;, all of which
    are payable by us.
</DIV>
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    <BR>
    69
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<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Over-Allotment
    Option</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have granted the underwriters an over-allotment option. This
    option, which is exercisable for up to 45&#160;days after the
    date of this prospectus, permits the underwriters to purchase a
    maximum
    of&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
    additional units, consisting of an aggregate
    of&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock and warrants to purchase an aggregate
    of&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock, from us to cover over-allotments. If the
    underwriters exercise all or part of this option, they will
    purchase units covered by the option at the public offering
    price that appears on the cover page of this prospectus, less
    the underwriting discount. The underwriters have severally
    agreed that, to the extent the over-allotment option is
    exercised, they will each purchase a number of additional units
    proportionate to the underwriter&#146;s initial amount reflected
    in the foregoing table.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Underwriters&#146;
    Warrants</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have also agreed to issue to the representative of the
    underwriters warrants to purchase a number of shares of our
    common stock equal to an aggregate of seven percent (7%) of the
    shares of common stock underlying units sold in the offering
    (or&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares).
    The warrants will have an exercise price equal to
    $&#160;&#160;&#160;&#160;&#160; per share. The warrant is
    exercisable commencing six months following the closing of this
    offering, and will be exercisable for five years thereafter. The
    warrant is not redeemable by us, and allows for
    &#147;cashless&#148; exercise. The warrant also provides for one
    demand and for unlimited &#147;piggyback&#148; registration
    rights with respect to the underlying shares during the five
    year period commencing six months after the effective date of
    this offering. Pursuant to the rules of the Financial Industry
    Regulatory Authority, Inc., or FINRA, and in particular
    Rule&#160;5110, the warrants (and underlying shares of common
    stock) issued to the representative of the underwriters may not
    be sold, transferred, assigned, pledged, or hypothecated, or the
    subject of any hedging, short sale, derivative, put or call
    transaction that would result in the effective disposition of
    the securities by any person for a period of 180&#160;days
    immediately following the date of delivery and payment for the
    units offered; provided, however, the warrant (and underlying
    shares) may be transferred to officers or directors of the
    representative of the underwriters and members of the
    underwriting syndicate and their affiliates as long as the
    warrants (and underlying shares) remain subject to the lockup.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times"><FONT style="white-space: nowrap">Lock-Up</FONT>
    Agreements</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our executive officers, directors and certain of our
    stockholders have agreed to a
    <FONT style="white-space: nowrap">90-day</FONT>
    <FONT style="white-space: nowrap">&#147;lock-up&#148;</FONT>
    from the date of this prospectus of shares of our common stock
    that they beneficially own, including the issuance of common
    stock upon the exercise of currently outstanding options and
    options which may be issued. This means that, for a period of
    90&#160;days following the date of this prospectus, such persons
    may not offer, sell, pledge or otherwise dispose of these
    securities without the prior written consent of the
    representative of the underwriters. The
    <FONT style="white-space: nowrap">lock-up</FONT>
    period described in the preceding paragraph will be extended if
    (1)&#160;during the last 17&#160;days of the
    <FONT style="white-space: nowrap">lock-up</FONT>
    period we issue an earnings release or material news or a
    material event relating to us occurs or (2)&#160;prior to the
    expiration of the
    <FONT style="white-space: nowrap">lock-up</FONT>
    period we announce that we will release earnings results during
    the <FONT style="white-space: nowrap">16-day</FONT>
    period beginning on the last day of the
    <FONT style="white-space: nowrap">lock-up</FONT>
    period, in which case the
    <FONT style="white-space: nowrap">lock-up</FONT>
    period will be extended until the expiration of the
    <FONT style="white-space: nowrap">18-day</FONT>
    period beginning on the date of issuance of the earnings release
    or the occurrence of the material news or material event.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The representative of the underwriters has no present intention
    to waive or shorten the
    <FONT style="white-space: nowrap">lock-up</FONT>
    period; however, the terms of the
    <FONT style="white-space: nowrap">lock-up</FONT>
    agreements may be waived at its discretion. In determining
    whether to waive the terms of the lockup agreements, the
    representative of the underwriters may base its decision on its
    assessment of the relative strengths of the securities markets
    and companies similar to ours in general, and the trading
    pattern of, and demand for, our securities in general.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In addition, the underwriting agreement provides that we will
    not, for a period of 90&#160;days following the date of this
    prospectus, offer, sell or distribute any of our securities,
    without the prior written consent of the representative of the
    underwriters.
</DIV>
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    <BR>
    70
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Other
    Terms</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have advanced $50,000 to Maxim Group LLC, which represents a
    reasonable estimate of the actual accountable expenses Maxim
    Group LLC will incur in the offering. Maxim Group LLC shall only
    receive an accountable expense reimbursement if the offering is
    terminated. If the offering is consummated, Maxim Group LLC will
    not receive an expense reimbursement and will refund the advance
    to us at the closing of the offering.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We also have agreed that, upon successful completion of this
    offering, for a period of six (6)&#160;months from the closing
    of this offering, we will grant Maxim Group LLC the right of
    participation to act as lead managing underwriter and book
    runner or minimally as a co-lead manager and co-book runner
    <FONT style="white-space: nowrap">and/or</FONT>
    co-lead placement agent with at least 50.0% of the economics;
    or, in the case of a three-handed deal 33.0% of the economics,
    for any and all future equity offerings as well as any
    convertible debt offerings undertaken during this period by us.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The underwriting agreement provides for indemnification between
    us and the underwriters against specified liabilities, including
    liabilities under the Securities Act, and for contribution by us
    and the underwriters to payments that may be required to be made
    with respect to those liabilities. We have been advised that, in
    the opinion of the SEC, indemnification liabilities under the
    Securities Act is against public policy as expressed in the
    Securities Act, and is therefore, unenforceable.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    This prospectus in electronic format may be made available on a
    website maintained by the representatives of the underwriters
    and may also be made available on a website maintained by other
    underwriters. The underwriters may agree to allocate a number of
    units to underwriters for sale to their online brokerage account
    holders. Internet distributions will be allocated by the
    representatives of the underwriters to underwriters that may
    make Internet distributions on the same basis as other
    allocations. In connection with the offering, the underwriters
    or syndicate members may distribute prospectuses electronically.
    No forms of electronic prospectus other than prospectuses that
    are printable as
    Adobe<SUP style="font-size: 85%; vertical-align: text-top">&#174;</SUP>

    PDF will be used in connection with this offering.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The underwriters have informed us that they do not expect to
    confirm sales of the securities offered by this prospectus to
    accounts over which they exercise discretionary authority
    without obtaining the specific approval of the account holder.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Stabilization</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Until the distribution of the securities offered by this
    prospectus is completed, rules of the SEC may limit the ability
    of the underwriters to bid for and to purchase our common stock.
    As an exception to these rules, the underwriters may engage in
    transactions effected in accordance with Regulation&#160;M under
    the Securities Exchange Act of 1934 that are intended to
    stabilize, maintain or otherwise affect the price of our common
    stock or publicly traded warrants. The underwriters may engage
    in over-allotment sales, syndicate covering transactions,
    stabilizing transactions and penalty bids in accordance with
    Regulation&#160;M.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Stabilizing transactions permit bids or purchases for the
    purpose of pegging, fixing or maintaining the price of our
    common stock and publicly traded warrants, so long as
    stabilizing bids do not exceed a specified maximum.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Over-allotment involves sales by the underwriters of securities
    in excess of the number of securities the underwriters are
    obligated to purchase, which creates a short position. The short
    position may be either a covered short position or a naked short
    position. In a covered short position, the number of shares of
    common stock or warrants over-allotted by the underwriters is
    not greater than the number of shares of common stock or
    warrants that they may purchase in the over-allotment option. In
    a naked short position, the number of shares of common stock or
    warrants involved is greater than the number of shares of common
    stock or warrants in the over-allotment option. The underwriters
    may close out any covered short position by either exercising
    their over-allotment option or purchasing common stock or
    warrants in the open market.
</TD>
</TR>

</TABLE>
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    <BR>
    71
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Covering transactions involve the purchase of securities in the
    open market after the distribution has been completed in order
    to cover short positions. In determining the source of
    securities to close out the short position, the underwriters
    will consider, among other things, the price of securities
    available for purchase in the open market as compared to the
    price at which they may purchase securities through the
    over-allotment option. If the underwriters sell more shares of
    common stock or warrants than could be covered by the
    over-allotment option, creating a naked short position, the
    position can only be closed out by buying securities in the open
    market. A naked short position is more likely to be created if
    the underwriters are concerned that there could be downward
    pressure on the price of the shares of common stock or publicly
    traded warrants in the open market after pricing that could
    adversely affect investors who purchase in this offering.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Penalty bids permit the underwriters to reclaim a selling
    concession from a selected dealer when the securities originally
    sold by the selected dealer are purchased in a stabilizing or
    syndicate covering transaction.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    These stabilizing transactions, covering transactions and
    penalty bids may have the effect of raising or maintaining the
    market price of our common stock or publicly traded warrants or
    preventing or retarding a decline in the market price of our
    common stock or publicly traded warrants. As a result, the price
    of our common stock or publicly traded warrants may be higher
    than the price that might otherwise exist in the open market.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Neither we nor the underwriters make any representation or
    prediction as to the effect that the transactions described
    above may have on the prices of our securities. These
    transactions may occur on the NYSE Amex or on any other trading
    market. If any of these transactions are commenced, they may be
    discontinued without notice at any time.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Foreign
    Regulatory Restrictions on Purchase of Units</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have not taken any action to permit a public offering of the
    units outside the United States or to permit the possession or
    distribution of this prospectus outside the United States.
    Persons outside the United States who come into possession of
    this prospectus must inform themselves about and observe any
    restrictions relating to this offering of units and the
    distribution of the prospectus outside the United States.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>European Economic Area.</I>&#160;&#160;In relation to each
    Member State of the European Economic Area which has implemented
    the Prospectus Directive (each, a relevant member state), with
    effect from and including the date on which the Prospectus
    Directive is implemented in that relevant member state (the
    relevant implementation date) an offer of securities to the
    public in that relevant member state prior to the publication of
    a prospectus in relation to the securities that have been
    approved by the competent authority in that relevant member
    state or, where appropriate, approved in another relevant member
    state and notified to the competent authority in that relevant
    member state, all in accordance with the Prospectus Directive,
    except that, with effect from and including the relevant
    implementation date, an offer of securities may be offered to
    the public in that relevant member state at any time:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    to any legal entity that is authorized or regulated to operate
    in the financial markets or, if not so authorized or regulated,
    whose corporate purpose is solely to invest in securities;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    to any legal entity which has two or more of (1)&#160;an average
    of at least 250&#160;employees during the last financial year;
    (2)&#160;a total balance sheet of more than &#128;43,000,000 and
    (3)&#160;an annual net turnover of more than &#128;50,000,000,
    as shown in its last annual or consolidated accounts;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    to fewer than 100 natural or legal persons (other than qualified
    investors as defined in the Prospectus Directive) subject to
    obtaining the prior consent of for any such offer;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    in any other circumstances which do not require the publication
    of a prospectus pursuant to Article&#160;3 of the Prospectus
    Directive.
</TD>
</TR>

</TABLE>
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    <BR>
    72
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Each purchaser of securities described in this prospectus
    located within a relevant member state will be deemed to have
    represented, acknowledged and agreed that it is a
    &#147;qualified investor&#148; within the meaning of
    Article&#160;2(1)(e) of the Prospectus Directive.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    For the purposes of this provision, the expression an
    &#147;offer to the public&#148; in any relevant member state
    means the communication in any form and by any means of
    sufficient information on the terms of the offer and the
    securities to be offered so as to enable an investor to decide
    to purchase or subscribe the securities, as the expression may
    be varied in that member state by any measure implementing the
    Prospectus Directive in that member state and the expression
    &#147;Prospectus Directive&#148; means Directive 2003/71/EC and
    includes any relevant implementing measure in each relevant
    member state.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Israel.</I>&#160;&#160;The units offered by this prospectus
    have not been approved or disapproved by the Israeli Securities
    Authority (ISA). The units may not be offered or sold, directly
    or indirectly, to the public in Israel. The ISA has not issued
    permits, approvals or licenses in connection with the offering
    of the units or publishing the prospectus; nor has it
    authenticated the details included herein, confirmed their
    reliability or completeness, or rendered an opinion as to the
    quality of the securities being offered. Any resale, directly or
    indirectly, to the public of the units offered by this
    prospectus is subject to restrictions on transferability and
    must be effected only in compliance with the Israeli securities
    laws and regulations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>United Kingdom.</I>&#160;&#160;In the United Kingdom, the
    units offered by this prospectus are directed to and will only
    be available for purchase to a person who is an exempt person as
    referred to at paragraph (c)&#160;below and who warrants,
    represents and agrees that: (a)&#160;it has not offered or sold,
    will not offer or sell, any units offered by this prospectus to
    any person in the United Kingdom except in circumstances which
    do not constitute an offer to the public in the United Kingdom
    for the purposes of section&#160;85 of the Financial Services
    and Markets Act 2000 (as amended) (&#147;FSMA&#148;); and
    (b)&#160;it has complied and will comply with all applicable
    provisions of FSMA and the regulations made thereunder in
    respect of anything done by it in relation to the units offered
    by this prospectus in, from or otherwise involving the United
    Kingdom; and (c)&#160;it is a person who falls within the
    exemptions to Section&#160;21 of the FSMA as set out in The
    Financial Services and Markets Act 2000 (Financial Promotion)
    Order 2005 (&#147;the Order&#148;), being either an investment
    professional as described under Article&#160;19 or any body
    corporate (which itself has or a group undertaking has a called
    up share capital or net assets of not less than &#163;500,000
    (if more than 20 members) or otherwise &#163;5&#160;million) or
    an unincorporated association or partnership (with net assets of
    not less than &#163;5&#160;million) or is a trustee of a high
    value trust or any person acting in the capacity of director,
    officer or employee of such entities as defined under
    Article&#160;49(2)(a) to (d)&#160;of the Order, or a person to
    whom the invitation or inducement may otherwise lawfully be
    communicated or cause to be communicated. The investment
    activity to which this document relates will only be available
    to and engaged in only with exempt persons referred to above.
    Persons who are not investment professionals and do not have
    professional experience in matters relating to investments or
    are not an exempt person as described above, should not review
    nor rely or act upon this document and should return this
    document immediately. It should be noted that this document is
    not a prospectus in the United Kingdom as defined in the
    Prospectus Regulations 2005 and has not been approved by the
    Financial Services Authority or any competent authority in the
    United Kingdom.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Italy.</I>&#160;&#160;This offering of the units has not been
    cleared by Consob, the Italian Stock Exchanges regulatory agency
    of public companies, pursuant to Italian securities legislation
    and, accordingly, no units may be offered, sold or delivered,
    nor may copies of this prospectus or of any other document
    relating to the units to be distributed in Italy, except
    (1)&#160;to professional investors (operatori qualificati); or
    (2)&#160;in circumstances which are exempted from the rules on
    solicitation of investments pursuant to Decree No.&#160;58 and
    Article&#160;33, first paragraph, of Consob
    Regulation&#160;No.&#160;11971 of May&#160;14, 1999, as amended.
    Any offer, sale or delivery of the securities or distribution of
    copies of this prospectus or any other document relating to the
    securities in Italy under (1)&#160;or (2)&#160;above must be
    (i)&#160;made by an investment firm, bank or financial
    intermediary permitted to conduct such activities in Italy in
    accordance with the Decree No.&#160;58 and Legislative Decree
    No.&#160;385 of September&#160;1, 1993, or the Banking Act; and
    (ii)&#160;in compliance with Article&#160;129 of the Banking Act
    and the implementing guidelines of the Bank of Italy, as amended
    from time to time, pursuant to which the issue or the offer of
    securities in Italy may need to be preceded and followed by an
    appropriate notice to be filed with
</DIV>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    the Bank of Italy depending, <I>inter alia</I>, on the aggregate
    value of the securities issued or offered in Italy and their
    characteristics; and (iii)&#160;in compliance with any other
    applicable laws and regulations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Germany.</I>&#160;&#160;The offering of the units is not a
    public offering in the Federal Republic of Germany. The units
    may only be acquired in accordance with the provisions of the
    Securities Sales Prospectus Act
    (Wertpapier-Verkaufsprospektgesetz), as amended, and any other
    applicable German law. No application has been made under German
    law to publicly market the securities in or out of the Federal
    Republic of Germany. The units are not registered or authorized
    for distribution under the Securities Sales Prospectus Act and
    accordingly may not be, and are not being, offered or advertised
    publicly or by public promotion. Therefore, this prospectus is
    strictly for private use and the offering is only being made to
    recipients to whom the document is personally addressed and does
    not constitute an offer or advertisement to the public. The
    units will only be available to persons who, by profession,
    trade or business, buy or sell securities for their own or a
    third party&#146;s account.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>France.</I>&#160;&#160;The units offered by this prospectus
    may not be offered or sold, directly or indirectly, to the
    public in France. This prospectus has not been or will not be
    submitted to the clearance procedure of the Autorit&#233; des
    March&#233;s Financiers, or the AMF, and may not be released or
    distributed to the public in France. Investors in France may
    only purchase the securities offered by this prospectus for
    their own account and in accordance with articles&#160;L.
    <FONT style="white-space: nowrap">411-1,</FONT> L.
    <FONT style="white-space: nowrap">441-2</FONT> and L.
    <FONT style="white-space: nowrap">412-1</FONT> of the
    Code Mon&#233;taire et Financier and decree
    <FONT style="white-space: nowrap">no.&#160;98-880</FONT>
    dated October&#160;1, 1998, provided they are &#147;qualified
    investors&#148; within the meaning of said decree. Each French
    investor must represent in writing that it is a qualified
    investor within the meaning of the aforesaid decree. Any resale,
    directly or indirectly, to the public of the units offered by
    this prospectus may be effected only in compliance with the
    above mentioned regulations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    &#147;Les actions offertes par ce document d&#146;information ne
    peuvent pas &#234;tre, directement ou indirectement, offertes ou
    vendues au public en France. Ce document d&#146;information
    n&#146;a pas &#233;t&#233; ou ne sera pas soumis au visa de
    l&#146;Autorit&#233; des March&#233;s Financiers et ne peut
    &#234;tre diffus&#233; ou distribu&#233; au public en France.
    Les investisseurs en France ne peuvent acheter les actions
    offertes par ce document d&#146;information que pour leur compte
    propre et conform&#233;ment aux articles&#160;L.
    <FONT style="white-space: nowrap">411-1,</FONT> L.
    <FONT style="white-space: nowrap">441-2</FONT> et L.
    <FONT style="white-space: nowrap">412-1</FONT> du
    Code Mon&#233;taire et Financier et du d&#233;cret
    <FONT style="white-space: nowrap">no.&#160;98-880</FONT>
    du 1&#160;octobre 1998, sous r&#233;serve qu&#146;ils soient des
    investisseurs qualifi&#233;s au sens du d&#233;cret
    susvis&#233;. Chaque investisseur doit d&#233;clarer par
    &#233;crit qu&#146;il est un investisseur qualifi&#233; au sens
    du d&#233;cret susvis&#233;. Toute revente, directe ou
    indirecte, des actions offertes par ce document
    d&#146;information au public ne peut &#234;tre effectu&#233;e
    que conform&#233;ment &#224; la r&#233;glementation
    susmentionn&#233;e.&#148;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Switzerland.</I>&#160;&#160;This prospectus may only be used
    by those persons to whom it has been directly handed out by the
    offeror or its designated distributors in connection with the
    offer described therein. The units are only offered to those
    persons
    <FONT style="white-space: nowrap">and/or</FONT>
    entities directly solicited by the offeror or its designated
    distributors, and are not offered to the public in Switzerland.
    This prospectus constitutes neither a public offer in
    Switzerland nor an issue prospectus in accordance with the
    respective Swiss legislation, in particular but not limited to
    Article&#160;652A Swiss Code Obligations. Accordingly, this
    prospectus may not be used in connection with any other offer,
    whether private or public and shall in particular not be
    distributed to the public in Switzerland.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Norway.</I>&#160;&#160;This prospectus has not been produced
    in accordance with the prospectus requirements laid down in the
    Norwegian Securities Trading Act 1997 as amended. This
    prospectus has not been approved or disapproved by, or
    registered with, neither the Oslo Stock Exchange nor the
    Norwegian Registry of Business Enterprises. This prospectus may
    not, either directly or indirectly be distributed to other
    Norwegian potential investors than the addressees without the
    prior consent of Vringo, Inc.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Denmark.</I>&#160;&#160;This prospectus has not been prepared
    in the context of a public offering of securities in Denmark
    within the meaning of the Danish Securities Trading Act
    No.&#160;171 of 17&#160;March 2005 as amended from time to time
    or any Executive Orders issued on the basis thereof and has not
    been and will not be filed with or approved by or filed with the
    Danish Financial Supervisory Authority or any other public
    authorities in Denmark. The offering of units will only be made
    to persons pursuant to one or more of the exemptions set out in
    Executive Order No.&#160;306 of 28&#160;April 2005 on
    Prospectuses for Securities Admitted for Listing or Trade on a
    Regulated Market and on the First Public Offer of Securities
    exceeding EUR&#160;2,500,000 or Executive
</DIV>
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    <BR>
    74
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Order No.&#160;307 of 28&#160;April 2005 on Prospectuses for the
    First Public Offer of Certain Securities between
    EUR&#160;100,000 and EUR&#160;2,500,000, as applicable.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Sweden.</I>&#160;&#160;Neither this prospectus nor the units
    offered hereunder have been registered with or approved by the
    Swedish Financial Supervisory Authority under the Swedish
    Financial Instruments Trading Act (1991:980) (as amended), nor
    will such registration or approval be sought. Accordingly, this
    prospectus may not be made available nor may the units offered
    hereunder be marketed or offered for sale in Sweden other than
    in circumstances which are deemed not to be an offer to the
    public in Sweden under the Financial Instruments Trading Act.
    This prospectus may not be distributed to the public in Sweden
    and a Swedish recipient of the prospectus may not in any way
    forward the prospectus to the public in Sweden.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>British Virgin Islands.</I>&#160;&#160;No shares, warrants or
    units of the Company shall be offered or sold, directly or
    indirectly, to the public or any member of the public in the
    British Virgin Islands.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Relationships</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Certain of the underwriters or their affiliates have provided
    from time to time and may in the future provide investment
    banking, lending, financial advisory and other related services
    to us and our affiliates for which they have received and may
    continue to receive customary fees and commissions.
</DIV>

<A name='117'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">LEGAL
    MATTERS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The validity of the securities being offered by this prospectus
    will be passed upon for us by Cooley Godward Kronish LLP,
    Reston, Virginia. The underwriters are being represented by
    Lowenstein Sandler PC, Roseland, New Jersey.
</DIV>

<A name='118'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">EXPERTS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Reznick Group P.C., independent registered public accounting
    firm, has audited our financial statements at December&#160;31,
    2009 and 2008, and for each of the two years in the period ended
    December&#160;31, 2009, as set forth in their report, which
    includes an explanatory paragraph relating to our ability to
    continue as a going concern. We have included our financial
    statements in this prospectus and elsewhere in the registration
    statement of which it is a part in reliance on Reznick
    Group&#146;s report, given on their authority as experts in
    accounting and auditing.
</DIV>

<A name='119'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">WHERE YOU
    CAN FIND ADDITIONAL INFORMATION</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have filed with the SEC a registration statement on
    <FONT style="white-space: nowrap">Form&#160;S-1</FONT>
    under the Securities Act, with respect to the securities being
    offered by this prospectus. This prospectus does not contain all
    of the information in the registration statement and its
    exhibits. For further information with respect to RegeneRx and
    the securities offered by this prospectus, we refer you to the
    registration statement and its exhibits. Statements contained in
    this prospectus as to the contents of any contract or any other
    document referred to are not necessarily complete, and in each
    instance, we refer you to the copy of the contract or other
    document filed as an exhibit to the registration statement. Each
    of these statements is qualified in all respects by this
    reference.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We are subject to the information reporting requirements of the
    Exchange Act, and we file reports, proxy statements and other
    information with the SEC. You can read our SEC filings,
    including the registration statement, over the Internet at the
    SEC&#146;s website at <I>www.sec.gov</I>. You may also read and
    copy any document we file with the SEC at its public reference
    facilities at 100&#160;F&#160;Street, N.E.,
    Washington,&#160;D.C. 20549. You may also obtain copies of these
    documents at prescribed rates by writing to the Public Reference
    Section of the SEC at 100&#160;F&#160;Street, N.E.,
    Washington,&#160;D.C. 20549. Please call the SEC at
    <FONT style="white-space: nowrap">1-800-SEC-0330</FONT>
    for further information on the operation of the public reference
    facilities.
</DIV>
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    <BR>
    75
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We also maintain a website at <I>www.regenerx.com</I>, at which
    you may access these materials free of charge as soon as
    reasonably practicable after they are electronically filed with,
    or furnished to, the SEC. The information contained in, or that
    can be accessed through, our website is not part of, and is not
    incorporated into, this prospectus.
</DIV>

<A name='120'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">DISCLOSURE
    OF COMMISSION POSITION ON INDEMNIFICATION FOR<BR>
    SECURITIES ACT LIABILITY</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Insofar as indemnification for liabilities arising under the
    Securities Act may be permitted to directors, officers or
    persons controlling the registrant pursuant to the foregoing
    provisions, the registrant has been informed that in the opinion
    of the SEC such indemnification is against public policy as
    expressed in the Securities Act and is, therefore, unenforceable.
</DIV>
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    <BR>
    76
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<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">RegeneRx
    Biopharmaceuticals, Inc.<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">


    <A name='121'><B><FONT style="font-family: 'Times New Roman', Times">Index
    to Financial Statements</FONT></B></A>
</DIV>
</A>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
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    <TD width="97%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=quadleft -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=quadright -->
</TR>
<!-- Table Width Row END -->
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<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Page</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#300'>Report of Independent Registered Public
    Accounting Firm</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    F-2
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#301'>Balance Sheets</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    F-3
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#302'>Statements of Operations</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    F-4
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#303'>Statements of Changes in Stockholders&#146;
    Equity</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    F-5
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#304'>Statements of Cash Flows</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    F-6
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#305'>Notes to Financial Statements</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    F-7
</TD>
<TD>&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-1
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<A name='300'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">REPORT OF
    INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM</FONT></B>
</DIV>
</A>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    To the Board of Directors and Stockholders of
</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    RegeneRx Biopharmaceuticals, Inc.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have audited the accompanying balance sheets of RegeneRx
    Biopharmaceuticals, Inc. (the &#147;Company&#148;) as of
    December&#160;31, 2009 and 2008, and the related statements of
    operations, changes in stockholders&#146; equity, and cash flows
    for each of the years in the two-year period ended
    December&#160;31, 2009. The Company&#146;s management is
    responsible for these financial statements. Our responsibility
    is to express an opinion on these financial statements based on
    our audits.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We conducted our audits in accordance with the standards of the
    Public Company Accounting Oversight Board (United States). Those
    standards require that we plan and perform the audit to obtain
    reasonable assurance about whether the financial statements are
    free of material misstatement. The Company is not required to
    have, nor were we engaged to perform, an audit of its internal
    control over financial reporting. Our audit included
    consideration of internal control over financial reporting as a
    basis for designing audit procedures that are appropriate in the
    circumstances, but not for the purpose of expressing an opinion
    on the effectiveness of the Company&#146;s internal control over
    financial reporting. Accordingly, we express no such opinion. An
    audit also includes examining, on a test basis, evidence
    supporting the amounts and disclosures in the financial
    statements, 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.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In our opinion, the financial statements referred to above
    present fairly, in all material respects, the financial position
    of RegeneRx Biopharmaceuticals, Inc. as of December&#160;31,
    2009 and 2008, and the results of its operations and its cash
    flows for each of the years in the two-year period ended
    December&#160;31, 2009 in conformity with accounting principles
    generally accepted in the United States of America.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The accompanying financial statements have been prepared
    assuming that the Company will continue as a going concern. As
    more fully described in Note&#160;1 to the financial statements,
    the Company has experienced negative cash flows from operations
    since inception and is dependent upon future financing in order
    to meet its planned operating activities. These conditions raise
    substantial doubt about the Company&#146;s ability to continue
    as a going concern. Management&#146;s plans regarding these
    matters are described in Note&#160;1. The financial statements
    do not include any adjustments that might result from the
    outcome of this uncertainty.
</DIV>

<DIV style="margin-top: 24pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 49%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    /s/ REZNICK GROUP,&#160;P.C.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Vienna, Virginia
</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    March&#160;31, 2010
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-2
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">RegeneRx
    Biopharmaceuticals, Inc.<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">


    <A name='301'><B><FONT style="font-family: 'Times New Roman', Times">
    <!-- XBRL,bs -->Balance Sheets</FONT></B></A>
</DIV>
<!-- XBRL,body -->
</A>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="73%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="9%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="9%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>December&#160;31,<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>December&#160;31,<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD colspan="9" align="center" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>ASSETS</B>
</DIV>
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Current assets
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Cash and cash equivalents
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    4,355,768
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    5,655,367
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Prepaid expenses and other current assets
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    196,546
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    236,477
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Total current assets
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,552,314
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,891,844
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Property and equipment, net of accumulated depreciation of
    $98,171 and $81,623
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,492
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    25,039
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Other assets
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    22,948
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,693
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Total assets
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    4,583,754
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    5,922,576
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD colspan="9" align="center" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>LIABILITIES AND STOCKHOLDERS&#146; EQUITY</B>
</DIV>
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Current liabilities
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Accounts payable
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    140,206
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    70,554
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Accrued expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    740,198
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,255,358
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Total current liabilities
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    880,404
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,325,912
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Commitments
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Stockholders&#146; equity
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Preferred stock, $.001&#160;par value per share,
    1,000,000&#160;shares authorized; no shares issued
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Common stock, $.001&#160;par value per share,
    100,000,000&#160;shares authorized; 60,406,828 and 53,622,491
    issued and outstanding
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    60,407
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    53,623
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Additional paid-in capital
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    88,144,347
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    82,550,585
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Accumulated deficit
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (84,501,404
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (78,007,544
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Total stockholders&#146; equity
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,703,350
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,596,664
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Total liabilities and stockholders&#146; equity
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    4,583,754
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    5,922,576
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>
<!-- /XBRL,bs -->
<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The accompanying notes are an integral part of these financial
    statements.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-3
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">RegeneRx
    Biopharmaceuticals, Inc.</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<!-- XBRL,op -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

    <A name='302'><B> Statements of Operations</B>
</DIV>
<!-- XBRL,body -->
</A>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="74%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="9%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Years Ended December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Sponsored research revenue
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    168,412
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Operating expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Research and development
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,724,514
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7,149,808
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    General and administrative
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,781,790
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,805,346
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Total operating expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,506,304
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    10,955,154
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Loss from operations
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (6,506,304
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (10,786,742
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Interest income
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    12,444
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    149,777
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net loss
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (6,493,860
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (10,636,965
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Basic and diluted net loss per common share
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (0.12
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (0.21
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Weighted average number of common shares outstanding
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    55,680,525
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    50,967,617
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>
<!-- /XBRL,op -->
<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The accompanying notes are an integral part of these financial
    statements.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-4
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">RegeneRx
    Biopharmaceuticals, Inc.<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">


    <A name='303'><B><FONT style="font-family: 'Times New Roman', Times">
    <!-- XBRL,se -->Statements of Changes in Stockholders&#146;
    Equity<BR>
    </FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times"><!-- XBRL,body -->Years
    ended December&#160;31, 2009 and 2008</FONT></B></A>
</DIV>
</A>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 9pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="35%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="9%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="9%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=06 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=lead -->
    <TD width="9%" align="right">&nbsp;</TD>	<!-- colindex=06 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=06 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=07 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=07 type=lead -->
    <TD width="9%" align="right">&nbsp;</TD>	<!-- colindex=07 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=07 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Accumulated<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Other<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Total<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Common Stock</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Additional<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Accumulated<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Comprehensive<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Stockholders&#146;<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Shares</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Amount</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Paid-in Capital</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Deficit</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Income/(loss)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Equity</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Balance, December&#160;31, 2007
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    46,553,527
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    46,554
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    73,513,292
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (67,405,579
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (1,543
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    6,152,724
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Cumulative effect of a change in accounting
    principle&#160;&#151; ASC Topic&#160;730
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    35,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    35,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Issuance of common stock, net of offering costs of $52,240
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7,068,964
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7,069
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7,940,691
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7,947,760
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Share-based compensation expense
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,096,602
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,096,602
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Net loss
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (10,636,965
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (10,636,965
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Unrealized gain on available for sale securities
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,543
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,543
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Total comprehensive loss
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (10,635,422
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Balance, December&#160;31, 2008
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    53,622,491
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    53,623
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    82,550,585
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (78,007,544
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    4,596,664
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Issuance of common stock, net of offering costs of $447,933
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,784,337
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,784
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,845,282
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,852,066
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Share-based compensation expense
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    748,480
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    748,480
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Net loss
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (6,493,860
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (6,493,860
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Balance, December&#160;31, 2009
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    60,406,828
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    60,407
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    88,144,347
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (84,501,404
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    3,703,350
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The accompanying notes are an integral part of these financial
    statements.
</DIV>
<!-- /XBRL,se -->
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-5
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">RegeneRx
    Biopharmaceuticals, Inc.<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">


    <A name='304'><B><FONT style="font-family: 'Times New Roman', Times">
    <!-- XBRL,cf -->Statements of Cash Flows</FONT></B></A>
</DIV>
<!-- XBRL,body -->
</A>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="74%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="9%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Years Ended December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Operating activities:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Net loss
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (6,493,860
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (10,636,965
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Adjustments to reconcile net loss to net cash used in operating
    activities:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Depreciation and amortization
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    16,547
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    19,396
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Non-cash share-based compensation
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    748,480
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,096,602
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Gain on settlement of accrued expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (100,000
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Changes in operating assets and liabilities:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 40pt">
    Accounts receivable
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    26,951
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 40pt">
    Prepaid expenses and other current assets
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    39,931
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    66,767
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 40pt">
    Other assets
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (17,255
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 40pt">
    Accounts payable
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    69,652
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (203,007
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 40pt">
    Accrued expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (415,160
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (940,150
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 50pt">
    Net cash used in operating activities
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (6,151,665
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (10,570,406
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Investing activities:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Sales/maturities of short-term investments
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,581,135
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 50pt">
    Net cash provided by investing activities
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,581,135
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Financing activities:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Net proceeds from issuance of common stock
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,852,066
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7,947,760
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 50pt">
    Net cash provided by financing activities
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,852,066
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7,947,760
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 50pt">
    Net (decrease) increase in cash and cash equivalents
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,299,599
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,958,489
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Cash and cash equivalents at beginning of year
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,655,367
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,696,878
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Cash and cash equivalents at end of year
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    4,355,768
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    5,655,367
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>
<!-- /XBRL,cf -->
<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The accompanying notes are an integral part of these financial
    statements.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-6
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL --><DIV style="margin-top: 0pt; font-size: 1pt">&nbsp;</DIV>
<!-- XBRL Pagebreak End -->
<!-- XBRL,ns -->
<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">RegeneRx
    Biopharmaceuticals, Inc.<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">


    <A name='305'><B><FONT style="font-family: 'Times New Roman', Times">Notes
    to Financial Statements</FONT></B></A>
</DIV>
</A>
<!-- XBRL,n -->
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">1.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">ORGANIZATION
    AND BUSINESS</FONT></B>
</TD>
</TR>

</TABLE>
<!-- XBRL,body -->
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Organization and Nature of
    Operations.</I>&#160;&#160;RegeneRx Biopharmaceuticals, Inc.
    (the &#147;Company&#148;, &#147;We&#148;, &#147;Us&#148;,
    &#147;Our&#148;), a Delaware corporation, was incorporated in
    1982. We are focused on the discovery and development of novel
    molecules to accelerate tissue and organ repair. Our operations
    are confined to one business segment: the development and
    marketing of product candidates based on Thymosin Beta 4
    (&#147;T&#223;4&#148;), an amino acid peptide.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Management Plans to Address Operating
    Conditions.</I>&#160;&#160;We have incurred net losses of
    $6.5&#160;million and $10.6&#160;million for the years ended
    December&#160;31, 2009 and 2008, respectively. Since inception,
    and through December&#160;31, 2009, we have an accumulated
    deficit of $84.5&#160;million and we had cash and cash
    equivalents of $4.4&#160;million as of December&#160;31, 2009.
    Based on our operating plan, we believe that our cash and cash
    equivalents will fund our operations into the third quarter of
    2010.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We anticipate incurring additional losses in the future as we
    continue to explore the potential clinical benefits of
    T&#223;4-based product candidates over multiple indications. We
    will need substantial additional funds in order to initiate any
    further preclinical studies or clinical trials, and to fund our
    operations beyond the third quarter of 2010. Accordingly, we
    will have a need for financing and are in the process of
    exploring various alternatives, including, without limitation, a
    public or private placement of our securities, debt financing or
    corporate collaboration and licensing arrangements or the sale
    of our company or certain of our intellectual property rights.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    These factors raise substantial doubt about our ability to
    continue as a going concern. The accompanying financial
    statements have been prepared assuming that we will continue as
    a going concern. This basis of accounting contemplates the
    recovery of our assets and the satisfaction of our liabilities
    in the normal course of business.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Although we intend to continue to seek additional financing or a
    strategic partner, we may not be able to complete a financing or
    corporate transaction, either on favorable terms or at all. If
    we are unable to complete a financing or strategic transaction,
    we may not be able to continue as a going concern after our
    funds have been exhausted, and we could be required to
    significantly curtail or cease operations, file for bankruptcy
    or liquidate and dissolve. There can be no assurance that we
    will be able to obtain any sources of funding. The financial
    statements do not include any adjustments relating to the
    recoverability and classification of recorded asset amounts and
    classification of liabilities that might be necessary should we
    be forced to take any such actions.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In addition to our current operational requirements, we expect
    to continue to expend substantial funds to complete our planned
    product development efforts. Additionally, we continually refine
    our operating strategy and evaluate alternative clinical uses of
    T&#223;4. However, substantial additional resources will be
    needed before we will be able to achieve sustained
    profitability. Consequently, we continually evaluate alternative
    sources of financing such as the sharing of development costs
    through strategic collaboration agreements. There can be no
    assurance that our financing efforts will be successful, and if
    we are not able to obtain sufficient levels of financing, we
    would delay certain clinical
    <FONT style="white-space: nowrap">and/or</FONT>
    research activities, and our financial condition would be
    materially and adversely affected. Even if we are able to obtain
    sufficient funding, other factors including competition,
    dependence on third parties, uncertainty regarding patents,
    protection of proprietary rights, manufacturing of peptides and
    technology obsolescence could have a significant impact on us
    and our operations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    To achieve profitability we must successfully conduct
    pre-clinical studies and clinical trials, obtain required
    regulatory approvals and successfully manufacture and market
    those pharmaceuticals we wish to commercialize. The time
    required to reach profitability is highly uncertain, and there
    can be no assurance that we will be able to achieve sustained
    profitability, if at all.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-7
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL -->
<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">RegeneRx
    Biopharmaceuticals, Inc.<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes to
    Financial Statements&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
<!-- XBRL Pagebreak End -->
<!-- XBRL,n -->
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">2.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">SUMMARY
    OF SIGNIFICANT ACCOUNTING POLICIES</FONT></B>
</TD>
</TR>

</TABLE>
<!-- XBRL,body -->
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Use of Estimates.</I>&#160;&#160;The preparation of financial
    statements in conformity with accounting principles generally
    accepted in the United Stated of America
    (&#147;U.S.&#160;GAAP&#148;) requires management to make certain
    estimates and assumptions that affect the reported earnings,
    financial position and various disclosures. Critical accounting
    policies involved in applying our accounting policies are those
    that require management to make assumptions about matters that
    are highly uncertain at the time the accounting estimate was
    made and those for which different estimates reasonably could
    have been used for the current period. Critical accounting
    estimates are also those which are reasonably likely to change
    from period to period, and would have a material impact on the
    presentation of our financial condition, changes in financial
    condition or results of operations. Our most critical accounting
    estimates relate to accounting policies for clinical trial
    accruals and share-based arrangements. Management bases its
    estimates on historical experience and on various other
    assumptions that it believes are reasonable under the
    circumstances. Actual results could differ from these estimates.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Cash and Cash Equivalents.</I>&#160;&#160;Cash and cash
    equivalents consist of cash and highly-liquid investments with
    original maturities of three months or less when acquired and
    are stated at cost that approximates their fair market value.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Concentration of Credit Risk.</I>&#160;&#160;Financial
    instruments, which potentially subject the Company to
    concentrations of credit risk, consist primarily of cash, and
    cash equivalents. We limit our exposure to credit loss by
    placing our cash and cash equivalents with high quality
    financial institutions and, in accordance with our investment
    policy, in securities that are rated investment grade.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Property and Equipment.</I>&#160;&#160;Property and equipment
    consists of office furniture and equipment, and is stated at
    cost and depreciated over the estimated useful lives of the
    assets (generally two to five years) using the straight-line
    method. Expenditures for maintenance and repairs which do not
    significantly prolong the useful lives of the assets are charged
    to expense as incurred. Depreciation expense was $16,547 and
    $19,396 for the years ended December&#160;31, 2009 and 2008,
    respectively.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Impairment of Long-lived Assets.</I>&#160;&#160;When we
    record long-lived assets our policy is to regularly perform
    reviews to determine if and when the carrying value of our
    long-lived assets becomes impaired. During the two years ended
    December&#160;31, 2009 we did not report qualifying long-lived
    assets and therefore no impairment losses were recorded.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Sponsored Research Revenues.</I>&#160;&#160;We account for
    non-refundable grants as &#147;Sponsored research revenues&#148;
    in the accompanying statements of operations. Revenues are
    recognized when the associated research has been performed and
    the related underlying costs are incurred.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Research and Development.</I>&#160;&#160;Research and
    development (&#147;R&#038;D&#148;) costs are expensed as
    incurred and include all of the wholly-allocable costs
    associated with our various clinical programs passed through to
    us by our outsourced vendors. Those costs include: manufacturing
    T&#223;4; formulation of T&#223;4 into the various product
    candidates; stability for both T&#223;4 and the various
    formulations; pre-clinical toxicology; safety and
    pharmacokinetic studies; clinical trial management; medical
    oversight; laboratory evaluations; statistical data analysis;
    regulatory compliance; quality assurance; and other related
    activities. R&#038;D includes cash and non-cash compensation,
    employee benefits, travel and other miscellaneous costs of our
    internal R&#038;D personnel, seven persons in total, who are
    wholly dedicated to R&#038;D efforts. R&#038;D also includes a
    pro-ration of our common infrastructure costs for office space
    and communications.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    On January&#160;1, 2008, pursuant to Accounting Standards
    Codification (&#147;ASC&#148;)
    <FONT style="white-space: nowrap">730-20</FONT>
    (formerly EITF Issue
    <FONT style="white-space: nowrap">No.&#160;07-3,</FONT>
    &#147;Accounting for Advance Payments for Goods or Services to
    Be Used in Future Research and Development Activities&#148;),
    &#147;Research and Development Costs,&#148; we changed our
    accounting for non-refundable advance payments to acquire goods
    or pay for services that will be consumed or performed in a
    future period
</DIV>
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    <BR>
    F-8
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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    <B><FONT style="font-family: 'Times New Roman', Times">RegeneRx
    Biopharmaceuticals, Inc.<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes to
    Financial Statements&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    in conducting research and development activities on behalf of
    the entity. Advance payments are recorded as an asset when the
    advance payments are made. Capitalized amounts are recognized as
    expense when the research and development activities are
    performed; that is, when the goods without alternative future
    use are acquired or the service is rendered. We determined that
    approximately $35,000 in qualifying transactions required
    capitalization as of January&#160;1, 2008, and accordingly
    recognized a cumulative-effect adjustment to our accumulated
    deficit as of that date.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Cost of Preclinical Studies and Clinical
    Trials.</I>&#160;&#160;We accrue estimated costs for preclinical
    studies based on estimates of work performed. We estimate
    expenses incurred for clinical trials that are in process based
    on patient enrollment and based on clinical data collection and
    management. Costs based on clinical data collection and
    management are recognized based on estimates of unbilled goods
    and services received in the reporting period. We monitor the
    progress of the trials and their related activities and adjust
    the accruals accordingly. Adjustments to accruals are charged to
    expense in the period in which the facts that give rise to the
    adjustment become known. In the event of early termination of a
    clinical trial, we would accrue an amount based on estimates of
    the remaining non-cancelable obligations associated with winding
    down the clinical trial.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Patent Costs.</I>&#160;&#160;Costs related to filing and
    pursuing patent applications are recognized as general and
    administrative expenses as incurred since recoverability of such
    expenditures is uncertain.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Income Taxes.</I>&#160;&#160;Income taxes are accounted for
    under the asset and liability method. Deferred tax assets and
    liabilities are recognized for the estimated future tax
    consequences attributable to differences between the financial
    statement carrying amounts of existing assets and liabilities
    and their respective tax bases and operating loss and tax credit
    carryforwards. Deferred tax assets and liabilities are measured
    using enacted tax rates expected to apply to taxable income in
    the years in which those temporary differences are expected to
    be recovered or settled. The effect on deferred tax assets and
    liabilities of a change in tax rates is recognized in income in
    the period that includes the enactment date. We recognize the
    effect of income tax positions only if those positions are more
    likely than not of being sustained. Recognized income tax
    positions are measured at the largest amount that is greater
    than 50% likely of being realized. Changes in recognition or
    measurement are reflected in the period in which the change in
    judgment occurs. The Company&#146;s policy for recording
    interest and penalties associated with audits is that penalties
    and interest expense are recorded in &#147;Income taxes&#148; in
    the Company&#146;s statements of operations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The ultimate realization of deferred tax assets is dependent
    upon the generation of future taxable income during the periods
    in which those temporary differences become deductible.
    Management considers the scheduled reversal of deferred tax
    liabilities, projected future taxable income, and tax planning
    strategies in making that assessment. We recorded a full
    valuation allowance against all estimated net deferred tax
    assets at December&#160;31, 2009 and 2008. We have significant
    net operating loss carryforwards to potentially reduce future
    federal and state taxable income, and research and
    experimentation tax credit carryforwards available to
    potentially offset future federal and state income taxes. Use of
    our net operating loss and research and experimentation credit
    carryforwards may be limited due to changes in our ownership as
    defined within Section&#160;382 of the Internal Revenue Code.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Net Loss Per Common Share.</I>&#160;&#160;Net loss per common
    share for the years ended December&#160;31, 2009 and 2008,
    respectively, is based on the weighted-average number of shares
    of common stock outstanding during the periods. Basic and
    diluted loss per share are identical for all periods presented
    as potentially dilutive securities have been excluded from the
    calculation of the diluted net loss per common share because the
    inclusion of such securities would be antidilutive. The
    potentially dilutive securities include 12,847,963&#160;shares
    and 9,366,590&#160;shares in 2009 and 2008, respectively,
    reserved for the exercise of outstanding options and warrants.
</DIV>
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    <BR>
    F-9
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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    <B><FONT style="font-family: 'Times New Roman', Times">RegeneRx
    Biopharmaceuticals, Inc.<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes to
    Financial Statements&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Share-Based Compensation.</I>&#160;&#160;We measure
    share-based compensation expense based on the grant date fair
    value of the awards which is then recognized over the period
    which service is required to be provided. We estimate the grant
    date fair value using the Black-Scholes option-pricing model
    (&#147;Black-Scholes&#148;). We recognized $748,480 and
    $1,096,602 in share-based compensation expense for the years
    ended December&#160;31, 2009 and 2008, respectively.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Fair Value of Financial Instruments.</I>&#160;&#160;The
    carrying amounts of our financial instruments, as reflected in
    the accompanying balance sheets, approximate fair value.
    Financial instruments consist of cash and cash equivalents, and
    accounts payable.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Recent Accounting Pronouncements.</I>&#160;&#160;In February
    2010, the Financial Accounting Standards Board
    (&#147;FASB&#148;) issued Accounting Standards Update (ASU
    2010&#160;&#151; 09)&#160;to address potential practice issues
    associated with FASB ASC&#160;855 (formerly SFAS&#160;165),
    &#147;Subsequent Events.&#148; The ASU was effective upon
    issuance and eliminated the requirement for entities that file
    or furnish financial statements with the SEC to disclose the
    date through which subsequent events have been evaluated in
    originally issued and reissued financial statements. Other
    entities would continue to be required to disclose the date
    through which subsequent events have been evaluated; however,
    disclosures about the date would be required only in financial
    statements revised because of an error correction or
    retrospective application of U.S.&#160;GAAP. Our adoption of
    this standard changed our presentation of subsequent events when
    preparing our financial statements.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In September 2009, the FASB ratified ASU
    <FONT style="white-space: nowrap">2009-13</FONT>
    (formerly
    <FONT style="white-space: nowrap">EITF&#160;08-1),</FONT>
    &#147;Revenue Recognition&#148; (ASC&#160;605):
    Multiple-Deliverable Revenue Arrangements, the final consensus
    reached by the Emerging Issues Task Force that revised the
    authoritative guidance for revenue arrangements with multiple
    deliverables. The guidance addresses how to determine whether an
    arrangement involving multiple deliverables contains more than
    one unit of accounting and how the arrangement consideration
    should be allocated among the separate units of accounting. The
    guidance will be effective for our fiscal year beginning
    January&#160;1, 2011 with early adoption permitted. The guidance
    may be applied retrospectively or prospectively for new or
    materially modified arrangements. We currently do not have any
    multiple-deliverable revenue arrangements, accordingly, the
    adoption of the guidance will not have an impact on our
    financial statements.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In August 2009, the FASB issued ASU
    <FONT style="white-space: nowrap">No.&#160;2009-05,</FONT>
    &#147;Fair Value Measurements and Disclosures
    (ASC&#160;820)&#160;&#151; Measuring Liabilities at Fair
    Value&#148; (ASU
    <FONT style="white-space: nowrap">2009-05).</FONT>
    ASU <FONT style="white-space: nowrap">2009-05</FONT>
    provides clarification that in circumstances in which a quoted
    price in an active market for the identical liability is not
    available, a reporting entity is required to measure fair value
    using a valuation technique that uses the quoted price of the
    identical liability when traded as an asset or the quoted prices
    for similar liabilities or similar liabilities when traded as
    assets. The guidance provided is effective for the first
    reporting period (including interim periods) beginning after
    issuance. Our adoption of ASU
    <FONT style="white-space: nowrap">2009-05</FONT> did
    not impact our financial position or results of operations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In June 2009, the FASB issued ASC&#160;105 (formerly
    SFAS&#160;168), &#147;The FASB Accounting Standards Codification
    and the Hierarchy of Generally Accepted Accounting
    Principles&#148; (ASC 105). ASC&#160;105 is now the source of
    authoritative U.S.&#160;GAAP recognized by the FASB to be
    applied by nongovernment entities. It also modifies the GAAP
    hierarchy to include only two levels of GAAP: authoritative and
    non-authoritative. ASC&#160;105 is effective for financial
    statements issued for interim and annual periods ended after
    September&#160;15, 2009. The adoption of this standard in 2009
    changed how we reference various elements of U.S.&#160;GAAP when
    preparing our financial statement disclosures, but did not have
    an impact on our financial position or results of operations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Other new pronouncements issued but not effective until after
    December&#160;31, 2009 are not expected to have a significant
    effect on our financial position or results of operations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Reclassifications.</I>&#160;&#160;Certain account balances as
    of and for the year ended December&#160;31, 2008 were
    reclassified to conform to current year presentation.
</DIV>
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    <BR>
    F-10
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    <B><FONT style="font-family: 'Times New Roman', Times">RegeneRx
    Biopharmaceuticals, Inc.<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes to
    Financial Statements&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
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<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">3.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">FAIR
    VALUE MEASUREMENTS</FONT></B>
</TD>
</TR>

</TABLE>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We adopted a new accounting standard that defines fair value and
    establishes a framework for fair value measurements effective
    January&#160;1, 2008 for financial assets and liabilities and
    effective January&#160;1, 2009 for non-financial assets and
    liabilities. This standard establishes a three-level hierarchy
    for fair value measurements. The hierarchy is based upon the
    transparency of inputs and the valuation of an asset or a
    liability as of the measurement date. The three levels of inputs
    are as follows:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Level&#160;1&#160;&#151; Quoted prices in active markets for
    identical assets and liabilities.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Level&#160;2&#160;&#151; Observable inputs other than quoted
    prices in active markets for identical assets and liabilities.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Level&#160;3&#160;&#151; Unobservable inputs.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    At December&#160;31, 2009 and 2008, we held no qualifying
    liabilities, and our only qualifying assets that required
    measurement under the foregoing fair value hierarchy were money
    market funds and U.S.&#160;Treasury Bills included in Cash and
    Cash Equivalents valued at $4.4&#160;million and
    $5.7&#160;million, respectively, using Level&#160;1 inputs.
</DIV>
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<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">4.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">LICENSES,
    INTELLECTUAL PROPERTY, AND RELATED PARTY TRANSACTIONS</FONT></B>
</TD>
</TR>

</TABLE>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have an exclusive, worldwide licensing agreement with the
    National Institutes of Health (&#147;NIH&#148;) for all claims
    to T&#223;4 within their broadly-defined patent application. In
    exchange for this exclusive worldwide license, we must make
    certain royalty and milestone payments to the NIH. Through
    December&#160;31, 2009 we have complied with these requirements.
    No assurance can be given as to whether or when a patent will be
    issued, or as to any claims that may be included or excluded
    within the patent. We have also filed numerous additional patent
    applications covering various compositions, uses, formulations
    and other components of T&#223;4, as well as to novel peptides
    resulting from our research efforts. Some of these patents have
    issued, while many patent applications are still pending.
    Minimum annual maintenance fees for each of the years ended
    December&#160;31, 2009 and 2008 were $25,000.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have entered into a License and Supply Agreement (the
    &#147;Agreement&#148;) with Defiante Farmaceutica, S.A.
    (&#147;Defiante&#148;) a Portuguese company that is a wholly
    owned subsidiary of Sigma-Tau, S.p.A., an international
    pharmaceutical company and an affiliate of Sigma-Tau Finanziaria
    S.p.A., who together with its affiliates comprise our largest
    stockholder group (the &#147;Sigma-Tau Group&#148;). This
    Agreement grants to Defiante the exclusive right to use T&#223;4
    to conduct research and development activities in Europe. Under
    the Agreement, we will receive fees and royalty payments based
    on a percentage of specified sales of T&#223;4-related products
    by Defiante. The term of the Agreement continues until the later
    of the expiration of any patents developed under the Agreement,
    the expiration of marketing rights, or December&#160;31, 2016.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In furtherance of the licensed rights, Sigma-Tau Group funded
    and managed the RegeneRx-sponsored Phase&#160;II dermal wound
    healing clinical trials in venous stasis ulcers conducted in
    Italy and Poland that concluded in the first quarter of 2009.
</DIV>
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    <BR>
    F-11
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    <B><FONT style="font-family: 'Times New Roman', Times">RegeneRx
    Biopharmaceuticals, Inc.<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes to
    Financial Statements&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
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<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">5.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">COMPOSITION
    OF CERTAIN FINANCIAL STATEMENT CAPTIONS</FONT></B>
</TD>
</TR>

</TABLE>
<!-- XBRL,body -->
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Accrued expenses are comprised of the following:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="77%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Accrued clinical research
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    496,997
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    944,283
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Accrued professional fees
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    122,590
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    155,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Accrued vacation
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    35,300
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    61,714
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Accrued license fees
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    30,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Accrued compensation
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    28,995
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    84,361
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Other
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    26,316
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    10,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    740,198
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1,255,358
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>
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<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">6.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">EMPLOYEE
    BENEFIT PLANS</FONT></B>
</TD>
</TR>

</TABLE>
<!-- XBRL,body -->
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have a defined contribution retirement plan that complies
    with Section&#160;401(k) of the Internal Revenue Code (the
    &#147;Code&#148;). All employees of the Company are eligible to
    participate in the plan. The Company matches 100% of each
    participant&#146;s voluntary contributions, subject to a maximum
    Company contribution of 4% of the participant&#146;s
    compensation. The Company&#146;s matching portion totaled
    $18,269 and $51,494 for the years ended December&#160;31, 2009
    and 2008, respectively. In order to conserve cash, the Company
    discontinued the matching contribution effective June&#160;5,
    2009 and reinstated it on March&#160;1, 2010.
</DIV>
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<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">7.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">STOCKHOLDERS&#146;
    EQUITY</FONT></B>
</TD>
</TR>

</TABLE>
<!-- XBRL,body -->
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Shareholders Rights Plan.</I>&#160;&#160;Our Board of
    Directors adopted a Rights Agreement, dated April&#160;29, 1994,
    as amended, that is intended to discourage an unsolicited change
    in control of the Company. In general, if an entity acquires
    more than a 25% ownership interest in the Company without the
    endorsement of our Board of Directors, then our current
    stockholders (other than the acquiring entity) will be issued a
    significant number of new shares, the effect of which would
    dilute the ownership of the acquiring entity and could delay or
    prevent the change in control.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Registration Rights Agreements.</I>&#160;&#160;In connection
    with the sale of certain equity instruments, we have entered
    into Registration Rights Agreements. Generally, these Agreements
    required us to file registration statements with the Securities
    and Exchange Commission to register common shares to permit
    re-sale of common shares previously sold under an exemption from
    registration or to register common shares that may be issued on
    exercise of outstanding warrants.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Registration Rights Agreements usually require us to pay
    penalties for any failure or time delay in filing or maintaining
    the effectiveness of the required registration statements. These
    penalties are usually expressed as a fixed percentage, per
    month, of the original amount we received on issuance of the
    common shares, options or warrants. While to date we have not
    incurred any penalties under these agreements, if a penalty is
    determined to be probable we would recognize the amount as a
    contingent liability and not as a derivative instrument.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Common Stock.</I>&#160;&#160;In February 2008, the Company
    sold 5,000,000&#160;shares of its common stock at a price of
    $1.00 per share, raising net proceeds of $4,947,760 (the
    &#147;February 2008 Private Placement&#148;) from Sigma Tau
    Group. In connection with the February 2008 Private Placement,
    the Company also issued warrants to the investors. The warrants
    are exercisable for an aggregate of 1,000,000&#160;shares of
    common stock at an exercise price of $1.60 per share. The
    warrants, which have a term of three years and an exercise price
    of $1.60 per
</DIV>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-12
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<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">RegeneRx
    Biopharmaceuticals, Inc.<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes to
    Financial Statements&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    share, were valued using the Black-Scholes option-pricing model
    as of the closing date and accounted for in permanent equity.
    The estimated fair market value of the warrants at the date of
    issuance was $0.3&#160;million.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Under the terms of the February 2008 Private Placement, the
    Company may, in its sole discretion, repurchase the shares at
    any time between January&#160;1, 2010 and December&#160;31,
    2010, for $2.50 per share. The Company&#146;s repurchase right
    terminates after December&#160;31, 2010. In addition, the
    investors have agreed to vote the shares, and any additional
    shares issued pursuant to the exercise of the warrants, as
    recommended by the Company&#146;s Board of Directors until
    December&#160;31, 2010.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In December 2008, the Company sold 2,068,964&#160;shares of its
    common stock at a price of $1.45 per share, raising net proceeds
    of $3,000,000 (the &#147;December 2008 Private Placement&#148;)
    from Sigma Tau Group. In connection with the December 2008
    Private Placement, the Company also issued warrants to the
    investors. The warrants are exercisable for an aggregate of
    745,104&#160;shares of common stock at an exercise price of
    $1.74 per share. The warrants, which have a term of three years
    and an exercise price of $1.74 per share, were valued using the
    Black-Scholes option-pricing model as of the closing date and
    accounted for in permanent equity. The estimated fair market
    value of the warrants at the date of issuance was
    $0.4&#160;million.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Under the terms of the December 2008 Private Placement, the
    investors have agreed to vote the shares, and any additional
    shares issued pursuant to the exercise of the warrants, as
    recommended by the Company&#146;s Board of Directors until
    December&#160;31, 2011.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    On April&#160;30, 2009 we issued 1,052,631&#160;shares of common
    stock at a price of $0.57 per share, and warrants to purchase
    263,158&#160;shares of our common stock at $0.91 per share, to
    Sigma-Tau Group for gross proceeds of $600,000. The warrants,
    which have a term of three years and an exercise price of $0.91
    per share, were valued using the Black-Scholes option-pricing
    model as of the closing date and accounted for in permanent
    equity. The estimated fair market value of the warrants at the
    date of issuance was $0.1&#160;million.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    On October&#160;5, 2009, we issued 4,512,194&#160;shares of
    common stock and warrants to purchase 2,256,097&#160;shares of
    our common stock in a registered direct offering to new
    institutional investors, for proceeds of approximately
    $3.3&#160;million, net of approximately $400,000 of offering
    costs. The warrants, which have a term of five years and an
    exercise price of $1.12 per share, were valued using the
    Black-Scholes option-pricing model as of the closing date and
    accounted for in permanent equity. The estimated fair market
    value of the warrants at the date of issuance was
    $1.0&#160;million.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    On October&#160;15, 2009, we issued 1,219,512&#160;shares of
    common stock and warrants to purchase 609,756&#160;shares of our
    common stock to Sigma-Tau Group for gross proceeds of
    $1.0&#160;million. The warrants, which become exercisable on
    April&#160;15, 2010 and have a term through September&#160;30,
    2014, and an exercise price of $1.12 per share, were valued
    using the Black-Scholes option-pricing model as of the closing
    date and accounted for in permanent equity. The estimated fair
    market value of the warrants at the date of issuance was
    $0.2&#160;million.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Share-Based Compensation.</I>&#160;&#160;We recognized
    $748,480 and $1,096,602 in stock-based compensation expense for
    the years ended December&#160;31, 2009 and 2008, respectively.
    Given our current estimates of future forfeitures, we expect to
    recognize the compensation cost related to non-vested options as
    of December&#160;31, 2009 of $723,000 over the weighted average
    remaining recognition period of 1.1&#160;years.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>2000 Stock Option and Incentive Plan, as
    amended.</I>&#160;&#160;Our Board of Directors (the
    &#147;Board&#148;) and stockholders have approved the 2000 Stock
    Option and Incentive Plan under which the Board may grant
    options to purchase shares of our common stock. Options may only
    be granted to our directors, officers, employees, consultants or
    advisors, and no single participant can receive more than
    450,000&#160;shares in any one year. The exercise price and term
    of any grant are determined by the Board at the time of grant
    but the exercise price may not be less than the fair market
    value of our common stock on the date of the grant, and the term
    of the option shall not exceed ten years. As of
    December&#160;31, 2009, there were 6,500,000&#160;shares
</DIV>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-13
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL -->
<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">RegeneRx
    Biopharmaceuticals, Inc.<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes to
    Financial Statements&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    reserved for issuance under the plan, of which 4,914,112 were
    outstanding and 1,550,888 were available for issuance.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following summarizes share-based compensation expense for
    the years ended December&#160;31, 2009 and 2008, which was
    allocated as follows:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="77%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Research and development
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    369,814
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    440,850
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    General and administrative
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    378,666
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    655,752
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    748,480
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1,096,602
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following summarizes stock option activity for the years
    ended December&#160;31, 2009 and 2008:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="50%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="11%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Options Outstanding</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Weighted<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Shares<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Average<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Available for<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Number of<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Exercise Price<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Exercise<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Grant</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Shares</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Range</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Price</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    December&#160;31, 2007
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    620,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,545,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    0.28 - $3.82
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1.80
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Grants
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (572,500
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    572,500
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1.14 - 1.50
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1.23
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Exercises
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Cancellations
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Newly authorized
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,300,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    December&#160;31, 2008
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,347,500
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,117,500
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    0.28 - 3.82
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1.72
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Grants
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,192,939
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,192,939
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    0.57  -  0.76
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    0.64
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Exercises
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Cancellations
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    396,327
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (396,327
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    0.57 - 2.59
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    0.82
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    December&#160;31, 2009
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,550,888
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,914,112
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    0.28 - $3.82
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1.53
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following summarizes information about stock options
    outstanding at December&#160;31, 2009:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="36%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=06 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=06 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=06 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=07 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=07 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=07 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=07 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Outstanding Options</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Exercisable Options</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Weighted-<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Weighted-<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Average<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Weighted-<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Average<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Weighted-<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Number of<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Remaining<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Average<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Number of<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Remaining<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Average<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Shares<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Contractual<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Exercise<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Shares<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Contractual<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Exercise<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Range of Exercise Prices</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Outstanding</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Life (in Years)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Price</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Exercisable</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Life (in Years)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Price</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    $0.28-$0.86
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,151,612
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4.5
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    0.50
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,724,112
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4.0
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    0.43
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    $1.07-$1.93
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    827,500
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5.0
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1.31
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    435,625
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4.6
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1.40
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    $2.02-$2.68
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    860,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4.3
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    2.26
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    323,750
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4.4
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    2.31
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    $3.00-$3.82
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,075,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5.4
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    3.19
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    950,832
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5.4
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    3.19
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,914,112
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,434,319
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Intrinsic value of
    <FONT style="white-space: nowrap">in-the-money</FONT>
    options, using the December&#160;31, 2009 closing price of $0.55
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    254,450
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    254,450
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Determining the Fair Value of Options.</I>&#160;&#160;We use
    the Black-Scholes valuation model to estimate the fair value of
    options granted. Black-Scholes considers a number of factors,
    including the market price and
</DIV>
<!-- XBRL Paragraph Pagebreak -->
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-14
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL -->
<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">RegeneRx
    Biopharmaceuticals, Inc.<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes to
    Financial Statements&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    volatility of our common stock. We used the following
    forward-looking range of assumptions to value each stock option
    granted to employees, directors and consultants during the years
    ended December&#160;31, 2009 and 2008:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="75%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="10%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="10%">&nbsp;</TD>	<!-- colindex=03 type=maindata -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Dividend yield
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    0.0%
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    0.0%
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Risk free rate of return
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="bottom">
    1.9 - 2.3%
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="bottom">
    0.8 - 3.7%
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Expected life in years
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="bottom">
    4.75 - 5.38
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="bottom">
    1.00 - 4.75
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Volatility
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="bottom">
    71 - 72%
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="bottom">
    68 - 82%
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Forfeitures
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    2.61%
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    &#151;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our dividend yield assumption is based on the fact that we have
    never paid cash dividends and do not anticipate paying cash
    dividends in the foreseeable future. Our risk-free interest rate
    assumption is based on yields of U.S.&#160;Treasury notes in
    effect at the date of grant. Our expected life represents the
    period of time that options granted are expected to be
    outstanding and is calculated in accordance with the Securities
    and Exchange Commission (&#147;SEC&#148;) guidance provided in
    the SEC&#146;s Staff Accounting Bulletin&#160;107
    (&#147;SAB&#160;107&#148;), using a &#147;simplified&#148;
    method. The Company has used the simplified method and will
    continue to use the simplified method as it does not have
    sufficient historical exercise data to provide a reasonable
    basis upon which to estimate an expected term. Our volatility
    assumption is based on reviews of the historical volatility of
    our common stock. We estimate forfeiture rates at the time of
    grant and adjust these estimates, if necessary, periodically
    based on the extent to which future actual forfeitures differ,
    or are expected to differ, from such estimates. Accordingly, we
    have estimated forfeiture percentages for the unvested portion
    of previously granted awards that remain outstanding at the date
    of adoption and for awards granted subsequent to the date of
    adoption. Forfeitures are estimated based on the demographics of
    current option holders and standard probabilities of employee
    turnover. Using Black-Scholes and these factors, the weighted
    average fair value of stock options granted to employees and
    directors was $0.39 for the year ended December&#160;31, 2009
    and $0.73 for the year ended December&#160;31, 2008.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We do not record tax-related effects on stock-based compensation
    given our historical and anticipated operating experience and
    offsetting changes in our valuation allowance which fully
    reserves against potential deferred tax assets.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Warrants
    to Purchase Common Stock.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table summarizes our warrant activity for 2009 and
    2008:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="63%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="11%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Warrants Outstanding</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Weighted<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Average<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Number of<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Exercise Price<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Exercise<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Shares</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Range</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Price</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    December&#160;31, 2007
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,522,544
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    2.75 - $4.06
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    3.26
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Grants
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,745,104
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1.60 - 1.74
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1.66
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Exercises
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Cancellations
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (18,558
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4.05 - 4.06
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4.05
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    December&#160;31, 2008
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,249,090
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1.60 - 4.06
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2.80
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Grants
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,129,011
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    0.91 - 1.12
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1.10
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Exercises
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Cancellations
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (444,250
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4.06
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4.06
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    December&#160;31, 2009
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7,933,851
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    0.91 - $4.06
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    2.01
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-15
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL -->
<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">RegeneRx
    Biopharmaceuticals, Inc.<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes to
    Financial Statements&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
<!-- XBRL Pagebreak End -->
<!-- XBRL,n -->
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">8.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">INCOME
    TAXES</FONT></B>
</TD>
</TR>

</TABLE>
<!-- XBRL,body -->
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Significant components of the Company&#146;s deferred tax assets
    at December&#160;31, 2009 and 2008 and related valuation
    reserves are presented below:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="71%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="10%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="10%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Deferred tax assets:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Net operating loss carryforwards
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    16,988,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    18,370,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Research and development tax credit carryforward
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,710,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,628,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Charitable contribution carryforward
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    37,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    39,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Accrued vacation
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    12,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Accrued expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    163,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    150,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Amortization
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Depreciation
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Stock option expense
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    975,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    919,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    19,887,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    21,124,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Less&#160;&#151; valuation allowance
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (19,887,000
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (21,123,000
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Net deferred tax asset
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Deferred tax liabilities:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Depreciation
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,000
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net deferred tax amounts
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    A full valuation allowance has been provided at
    December&#160;31, 2009 and 2008 to reserve for deferred tax
    assets, as it appears more likely than not that net deferred tax
    assets will not be realized.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    At December&#160;31, 2009, we had net operating loss
    carryforwards for income tax purposes of approximately
    $43.1&#160;million, which are available to offset future federal
    and state taxable income, if any, and, research and development
    tax credit carryforwards of approximately $1.7&#160;million. The
    carryforwards, if not utilized, will expire in increments
    through 2029.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Code imposes substantial restrictions on the utilization of
    net operating losses and tax credits in the event of a
    corporation&#146;s ownership change, as defined in
    Section&#160;382 of the Code. During 2009, the Company completed
    a preliminary study to compute any limits on the net operating
    losses and credit carryforwards for purposes of
    Section&#160;382. It was determined that the Company experienced
    a cumulative change in ownership, as defined by the regulations,
    in 2002. This change in ownership triggers an annual limitation
    on the Company&#146;s ability to utilize certain
    U.S.&#160;federal and state net operating loss carryforwards and
    research tax credit carryforwards, resulting in the potential
    loss of approximately $9.8&#160;million of net operating loss
    carryforwards and $0.2&#160;million in research credit
    carryforwards. The Company has reduced the deferred tax assets
    associated with these carryforwards in its balance sheet at
    December&#160;31, 2009 and 2008.
</DIV>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-16
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">RegeneRx
    Biopharmaceuticals, Inc.<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes to
    Financial Statements&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The provision for income taxes on earnings subject to income
    taxes differs from the statutory Federal rate at
    December&#160;31, 2009 and 2008, due to the following:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="73%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="9%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="9%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Tax benefit at statutory rate
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (2,213,000
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (3,617,000
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    State taxes
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (354,000
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (579,000
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Permanent M-1s
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    339,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    563,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Limited/expired net operating loss carryforwards
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,546,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,150,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Limited/expired research and development tax credit carryforward
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    120,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    284,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Research and development tax credit carryforward
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (202,000
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (504,000
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Change in effective tax rate
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (455,000
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Change in valuation allowance
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,236,000
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,842,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As discussed in Note&#160;2, we recognize the effect of income
    tax positions only if those positions more likely than not of
    being sustained. At December&#160;31, 2009, and
    December&#160;31, 2008 we had no gross unrecognized tax
    benefits. We do not expect any significant changes in
    unrecognized tax benefits over the next 12&#160;months. In
    addition, we did not recognize any interest or penalties related
    to uncertain tax positions at December&#160;31, 2009 and 2008.
</DIV>
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<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">9.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">COMMITMENTS</FONT></B>
</TD>
</TR>

</TABLE>
<!-- XBRL,body -->
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Lease.</I>&#160;&#160;Our rent expense, related solely to
    office space, for 2009 and 2008 was $91,183 and $100,196,
    respectively. We are committed under an office space lease that
    expires on January&#160;31, 2013 that requires the following
    approximate annual lease payments: $63,000, $94,000, $98,000 and
    $8,000 for the years ending December&#160;31, 2010, through
    2013, respectively.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Employment Continuity Agreements.</I>&#160;&#160;We have
    entered into employment contracts with our executive officers
    which provide for severance if the executive is dismissed
    without cause or under certain circumstances after a change of
    control in our ownership. At December&#160;31, 2009 these
    obligations, if triggered, could amount to a maximum of
    approximately $900,000 in the aggregate.
</DIV>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-17
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<CENTER style="font-size: 1pt; width: 100%; border-bottom: 2pt solid #000000"></CENTER>

<CENTER style="font-size: 1pt; width: 100%; border-bottom: 1pt solid #000000"></CENTER>

<DIV style="margin-top: 4pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 20pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <FONT style="font-size: 14pt">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;<B>Units</B>
    </FONT>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <IMG src="w78085w7808500.gif" alt="(REGENERX LOGO)"><B><FONT style="font-size: 14pt">
    </FONT></B>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 14pt">Common Stock</FONT></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 14pt">Warrants</FONT></B>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<CENTER style="font-size: 1pt; width: 14%; border-bottom: 1pt solid #000000"></CENTER>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 12pt">PROSPECTUS</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<CENTER style="font-size: 1pt; width: 14%; border-bottom: 1pt solid #000000"></CENTER>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 18pt">Maxim Group LLC</FONT></B>
</DIV>

<DIV style="margin-top: 30pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 18pt">Boenning&#160;&#038;
    Scattergood, Inc.</FONT></B>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    &#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;,
    2010
</DIV>

<DIV style="margin-top: 24pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 8pt; font-size: 1pt">&nbsp;</DIV>

<CENTER style="font-size: 1pt; width: 100%; border-bottom: 1pt solid #000000"></CENTER>

<CENTER style="font-size: 1pt; width: 100%; border-bottom: 2pt solid #000000"></CENTER>
<!-- XBRL Pagebreak Begin -->

<P align="left" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">PART&#160;II<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">INFORMATION
    NOT REQUIRED IN PROSPECTUS</FONT></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="9%"></TD>
    <TD width="91%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">Item&#160;13.<I>&#160;&#160;</I></FONT></B>
</TD>
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">Other
    Expenses of Issuance and Distribution.</FONT></I></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table sets forth all costs and expenses, other
    than underwriting discounts and commissions, payable by us in
    connection with the sale of the common stock being registered.
    All amounts shown are estimates except for the SEC registration
    fee, the FINRA filing fee and the NYSE Amex listing fee.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="90%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Amount to<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>be Paid</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    SEC registration fee
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    855.60
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    FINRA filing fee
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,700
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    NYSE Amex listing fee
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    *
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Reimbursable expenses of the underwriters
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    *
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Printing and engraving expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    *
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Legal fees and expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    *
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Blue Sky fees and expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    *
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Accounting fees and expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    *
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Transfer agent and registrar fees and expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    *
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Miscellaneous expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    *
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Total
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    *
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="1%"></TD>
    <TD width="1%"></TD>
    <TD width="98%"></TD>
</TR>

<TR>
    <TD valign="top">
    * </TD>
    <TD></TD>
    <TD valign="bottom">
    To be filed by amendment.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="9%"></TD>
    <TD width="91%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">Item&#160;14.<I>&#160;&#160;</I></FONT></B>
</TD>
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">Indemnification
    of Directors and Officers.</FONT></I></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We are incorporated under the laws of the State of Delaware.
    Section&#160;102(b)(7) of the Delaware General Corporation Law,
    or DGCL, permits a corporation to provide in its certificate of
    incorporation that a director of the corporation shall not be
    personally liable to the corporation or its stockholders for
    monetary damages for breach of fiduciary duties as a director,
    except for liability for any:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    transaction from which the director derives an improper personal
    benefit;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    act or omission not in good faith or that involves intentional
    misconduct or a knowing violation of law;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    unlawful payment of dividends or redemption of shares;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    breach of a director&#146;s duty of loyalty to the corporation
    or its stockholders.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our restated certificate of incorporation includes such a
    provision.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Section&#160;145 of the DGCL provides that a Delaware
    corporation may indemnify any persons who are, or are threatened
    to be made, parties to any threatened, pending or completed
    action, suit or proceeding, whether civil, criminal,
    administrative or investigative (other than an action by or in
    the right of such corporation), by reason of the fact that such
    person was an officer, director, employee or agent of such
    corporation, or is or was serving at the request of such person
    as an officer, director, employee or agent of another
    corporation or enterprise. Our amended and restated bylaws
    include such a provision. The indemnity may include expenses
    (including attorneys&#146; fees), judgments, fines and amounts
    paid in settlement actually and reasonably incurred by such
    person in connection with such action, suit or proceeding,
    provided that such person acted in good faith and in a manner he
    or she reasonably believed to be in or not opposed to the
    corporation&#146;s best interests and, with respect to any
    criminal action or proceeding, had no reasonable cause to
    believe that his or her conduct was unlawful.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    II-1
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Section&#160;145 of the DGCL also provides that a Delaware
    corporation may indemnify any persons who are, or are threatened
    to be made, a party to any threatened, pending or completed
    action or suit by or in the right of the corporation by reason
    of the fact that such person was a director, officer, employee
    or agent of such corporation, or is or was serving at the
    request of such corporation as a director, officer, employee or
    agent of another corporation or enterprise. Our amended and
    restated bylaws contain such a provision. The indemnity may
    include expenses (including attorneys&#146; fees) actually and
    reasonably incurred by such person in connection with the
    defense or settlement of such action or suit provided such
    person acted in good faith and in a manner he or she reasonably
    believed to be in or not opposed to the corporation&#146;s best
    interests except that no indemnification is permitted without
    judicial approval if the officer or director is adjudged to be
    liable to the corporation. Where an officer or director is
    successful on the merits or otherwise in the defense of any
    action referred to above, the corporation must indemnify him or
    her against the expenses that such officer or director has
    actually and reasonably incurred.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Expenses incurred by any indemnitee in defending or
    investigating a threatened or pending action, suit or proceeding
    in advance of its final disposition shall be paid by us upon
    delivery to us of an undertaking, by or on behalf of such
    indemnitee, to repay all amounts so advanced if it shall
    ultimately be determined that such indemnitee is not entitled to
    be indemnified by us. No advance will be made by us if a
    determination is reasonably and promptly made by our board of
    directors by a majority vote of a quorum of disinterested
    directors, or if such a quorum is not obtainable or, even if
    obtainable, a quorum of disinterested directors so directs, by
    independent legal counsel in a written opinion, that, based upon
    the facts known to the board or counsel at the time such
    determination is made, such person did not meet the applicable
    standard of conduct in order to be indemnified.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    At present, there is no pending litigation or proceeding
    involving any of our directors or officers as to which
    indemnification is required or permitted, and we are not aware
    of any threatened litigation or proceeding that may result in a
    claim for indemnification.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have an insurance policy covering our officers and directors
    with respect to certain liabilities, including liabilities
    arising under the Securities Act or otherwise.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We plan to enter into an underwriting agreement that provides
    that the underwriters are obligated, under some circumstances,
    to indemnify our directors, officers and controlling persons
    against specified liabilities, including liabilities under the
    Securities Act.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="9%"></TD>
    <TD width="91%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">Item&#160;15.<I>&#160;&#160;</I></FONT></B>
</TD>
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">Recent
    Sales of Unregistered Securities.</FONT></I></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following list sets forth information regarding all
    unregistered securities sold by us since January&#160;1, 2007
    through the date of this registration statement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    1)&#160;In February 2008, we issued and sold
    5,000,000&#160;shares of common stock at a price of $1.00 per
    share, and warrants to purchase an aggregate of
    1,000,000&#160;shares of common stock at an exercise price of
    $1.60 per share, to two accredited investors for aggregate
    consideration of approximately $5.0&#160;million.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    2)&#160;In December 2008, we issued and sold
    2,068,964&#160;shares of common stock at a price of $1.45 per
    share, and warrants to purchase an aggregate of
    745,104&#160;shares of common stock at an exercise price of
    $1.74 per share, to two accredited investors for aggregate
    consideration of approximately $3.0&#160;million.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    3)&#160;On April&#160;30, 2009 we issued and sold
    1,052,631&#160;shares of common stock at a price of $0.57 per
    share, and warrants to purchase an aggregate of
    263,158&#160;shares of common stock at an exercise price of
    $0.91 per share, to one accredited investor for aggregate
    consideration of $600,000.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    4)&#160;On October&#160;5, 2009, we issued and sold
    4,512,194&#160;shares of common stock at a price of $0.82 per
    share, and warrants to purchase an aggregate of
    2,256,097&#160;shares of common stock at an exercise price of
    $1.12 per share, to three accredited investors for aggregate
    consideration of $3.7&#160;million.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    5)&#160;On October&#160;15, 2009, we issued and sold
    1,219,512&#160;shares of common stock at a price of $0.82 per
    share, and warrants to purchase an aggregate of
    609,756&#160;shares of common stock at an exercise price of
    $1.12 per share, to one accredited investor for aggregate
    consideration of $1.0&#160;million.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    II-2
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The offers, sales and issuances of the securities described in
    paragraphs (1)&#160;through (5)&#160;were exempt from
    registration under the Securities Act under Section&#160;4(2) of
    the Securities Act and Regulation&#160;D promulgated thereunder
    as transactions by an issuer not involving a public offering.
    The recipients of securities in each of these transactions
    acquired the securities for investment only and not with a view
    to or for sale in connection with any distribution thereof and
    appropriate legends were affixed to the securities issued in
    these transactions. Each of the recipients of securities in
    these transactions was an accredited investor as defined in
    Rule&#160;501 promulgated under the Securities Act.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="9%"></TD>
    <TD width="91%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">Item&#160;16.<I>&#160;&#160;</I></FONT></B>
</TD>
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">Exhibits
    and Financial Statement Schedules.</FONT></I></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="4%"></TD>
    <TD width="92%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    (a)&#160;&#160;
</TD>
    <TD align="left">
    <I>Exhibits</I>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=01 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=01 type=body -->
    <TD width="4%" align="left">&nbsp;</TD>	<!-- colindex=01 type=align1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="89%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD colspan="3" nowrap align="left" valign="bottom">
    <B>Exhibit<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD colspan="3" nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Number</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Description of Document</B>
</DIV>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    1
</TD>
<TD nowrap align="left" valign="top">
    .1&#134;
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Form of Underwriting Agreement.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    3
</TD>
<TD nowrap align="left" valign="top">
    .1
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Restated Certificate of Incorporation.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    3
</TD>
<TD nowrap align="left" valign="top">
    .2
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Certificate of Amendment of Restated Certificate of
    Incorporation.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    3
</TD>
<TD nowrap align="left" valign="top">
    .3
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Certificate of Amendment of Restated Certificate of
    Incorporation.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    3
</TD>
<TD nowrap align="left" valign="top">
    .4
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Certificate of Designation of Series A Participating Cumulative
    Preferred Stock.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    3
</TD>
<TD nowrap align="left" valign="top">
    .5(1)
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Amended and Restated Bylaws adopted July 26, 2006.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    3
</TD>
<TD nowrap align="left" valign="top">
    .6(2)
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Amendment to Amended and Restated Bylaws.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    4
</TD>
<TD nowrap align="left" valign="top">
    .1
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Specimen Common Stock Certificate.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    4
</TD>
<TD nowrap align="left" valign="top">
    .2
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Specimen Rights Certificate.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    4
</TD>
<TD nowrap align="left" valign="top">
    .3
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Rights Agreement, dated April 29, 1994, between the Company and
    American Stock Transfer &#038; Trust Company, as Rights Agent.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    4
</TD>
<TD nowrap align="left" valign="top">
    .4
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Amendment No. 1 to Rights Agreement, dated March 4, 2004,
    between the Company and American Stock Transfer &#038; Trust
    Company, as Rights Agent.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    4
</TD>
<TD nowrap align="left" valign="top">
    .5&#134;
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Form of Warrant Agreement.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    4
</TD>
<TD nowrap align="left" valign="top">
    .6&#134;
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Form of Warrant Certificate.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    5
</TD>
<TD nowrap align="left" valign="top">
    .1&#134;
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Opinion of Cooley Godward Kronish LLP.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .1+(3)
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Amended and Restated 2000 Stock Option and Incentive Plan, as
    amended.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .2*(4)
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Patent License Agreement&#160;&#151;&#160;Exclusive, dated
    January 24, 2001, between the Company and the U.S. Public Health
    Service.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .3*(5)
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Thymosin Beta 4 License and Supply Agreement, dated January 21,
    2004, between the Company and Defiante Farmaceutica S.A.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .4(6)
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Lease by and between RegeneRx Biopharmaceuticals, Inc. and The
    Realty Associates Fund&#160;V, L.P., dated December 10, 2009.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .5+(8)
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Second Amended and Restated Employment Agreement, dated March
    11, 2009, between the Company and Allan L. Goldstein, as amended.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .6+(7)
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Second Amended and Restated Employment Agreement, dated March
    12, 2009, between the Company and J.J. Finkelstein, as amended.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .7+(7)
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Second Amended and Restated Employment Agreement, dated March
    31, 2009, between the Company and C. Neil Lyons, as amended.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .8+(7)
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Second Amended and Restated Employment Agreement, dated March
    31, 2009, between the Company and David Crockford.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .1(9)
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Stock Purchase Agreement, dated as of June 23, 2005.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .2(10)
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Form of Warrant to Purchase Common Stock, dated March 17, 2006.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .3(11)
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Form of Warrant to Purchase Common Stock, dated December 18,
    2006.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .4(11)
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Registration Rights Agreement, dated as of December 15, 2006.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .5(12)
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Securities Purchase Agreement, dated as of February 27, 2008.
</TD>
</TR>
</TABLE>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    II-3
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->
<!-- XBRL Table Pagebreak -->

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=01 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=01 type=body -->
    <TD width="4%" align="left">&nbsp;</TD>	<!-- colindex=01 type=align1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="89%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD colspan="3" nowrap align="left" valign="bottom">
    <B>Exhibit<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD colspan="3" nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Number</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Description of Document</B>
</DIV>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .6(12)
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Form of Warrant to Purchase Common Stock, dated February 29,
    2008.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .7(13)
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Securities Purchase Agreement, dated as of December 10, 2008.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .8(13)
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Form of Warrant to Purchase Common Stock, dated December 10,
    2008.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .9(14)
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Securities Purchase Agreement, dated as of April 13, 2009.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .10(14)
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Form of Warrant to Purchase Common Stock, dated April 30, 2009.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .11(15)
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Securities Purchase Agreement, dated as of September 30, 2009.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .12(15)
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Form of Warrant to Purchase Common Stock, dated October 5, 2009.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .13(16)
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Securities Purchase Agreement, dated as of September&#160;30,
    2009.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .14(16)
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Form of Warrant to Purchase Common Stock, dated October 15, 2009.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    23
</TD>
<TD nowrap align="left" valign="top">
    .1
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Consent of Reznick Group,&#160;P.C., independent registered
    public accounting firm.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    23
</TD>
<TD nowrap align="left" valign="top">
    .2&#134;
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Consent of Cooley Godward Kronish LLP (included in Exhibit 5.1).
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    24
</TD>
<TD nowrap align="left" valign="top">
    .1
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Power of Attorney.  Reference is made to the signature page
    hereto.
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    Filed as an exhibit to the registrant&#146;s Quarterly Report on
    <FONT style="white-space: nowrap">Form&#160;10-Q</FONT>
    for the quarter ended June&#160;30, 2006 filed with the
    Securities and Exchange Commission on August&#160;14, 2006 and
    incorporated herein by reference.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (2) </TD>
    <TD></TD>
    <TD valign="bottom">
    Filed as an exhibit to the registrant&#146;s Registration
    Statement on
    <FONT style="white-space: nowrap">Form&#160;S-8</FONT>
    (File No.
    <FONT style="white-space: nowrap">333-152250)</FONT>
    filed with the Securities and Exchange Commission on
    July&#160;10, 2008 and incorporated herein by reference.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (3) </TD>
    <TD></TD>
    <TD valign="bottom">
    Filed as Annex&#160;A to the registrant&#146;s definitive proxy
    statement on Schedule&#160;14A filed with the Securities and
    Exchange Commission on May&#160;9, 2008 and incorporated herein
    by reference.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (4) </TD>
    <TD></TD>
    <TD valign="bottom">
    Filed as an exhibit to the registrant&#146;s Annual Report on
    <FONT style="white-space: nowrap">Form&#160;10-KSB</FONT>
    for the year ended December&#160;31, 2000 (File
    <FONT style="white-space: nowrap">No.&#160;1-15070)</FONT>
    filed with the Securities and Exchange Commission on
    April&#160;2, 2001 and incorporated herein by reference.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (5) </TD>
    <TD></TD>
    <TD valign="bottom">
    Filed as an exhibit to the registrant&#146;s Registration
    Statement on
    <FONT style="white-space: nowrap">Form&#160;SB-2</FONT>
    (File No.
    <FONT style="white-space: nowrap">333-113417)</FONT>
    filed with the Securities and Exchange Commission on
    March&#160;9, 2004 and incorporated herein by reference.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (6) </TD>
    <TD></TD>
    <TD valign="bottom">
    Filed as an exhibit to the registrant&#146;s Annual Report on
    <FONT style="white-space: nowrap">Form&#160;10-K</FONT>
    for the year ended December&#160;31, 2009 filed with the
    Securities and Exchange Commission on March&#160;31, 2010 and
    incorporated herein by reference.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (7) </TD>
    <TD></TD>
    <TD valign="bottom">
    Filed as an exhibit to the registrant&#146;s Annual Report on
    <FONT style="white-space: nowrap">Form&#160;10-K</FONT>
    for the year ended December&#160;31, 2008 filed with the
    Securities and Exchange Commission on April&#160;15, 2009 and
    incorporated herein by reference.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (8) </TD>
    <TD></TD>
    <TD valign="bottom">
    Filed as an exhibit to Amendment No.&#160;1 the
    registrant&#146;s Annual Report on
    <FONT style="white-space: nowrap">Form&#160;10-K/A</FONT>
    for the year ended December&#160;31, 2008 filed with the
    Securities and Exchange Commission on April&#160;30, 2009 and
    incorporated herein by reference.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (9) </TD>
    <TD></TD>
    <TD valign="bottom">
    Filed as an exhibit to the registrant&#146;s Current Report on
    <FONT style="white-space: nowrap">Form&#160;8-K</FONT>
    filed with the Securities and Exchange Commission on
    June&#160;23, 2005 and incorporated herein by reference.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (10) </TD>
    <TD></TD>
    <TD valign="bottom">
    Filed as an exhibit to the registrant&#146;s Current Report on
    <FONT style="white-space: nowrap">Form&#160;8-K</FONT>
    filed with the Securities and Exchange Commission on
    March&#160;7, 2006 and incorporated herein by reference.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (11) </TD>
    <TD></TD>
    <TD valign="bottom">
    Filed as an exhibit to the registrant&#146;s Current Report on
    <FONT style="white-space: nowrap">Form&#160;8-K</FONT>
    filed with the Securities and Exchange Commission on
    December&#160;18, 2006 and incorporated herein by reference.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (12) </TD>
    <TD></TD>
    <TD valign="bottom">
    Filed as an exhibit to the registrant&#146;s Current Report on
    <FONT style="white-space: nowrap">Form&#160;8-K</FONT>
    filed with the Securities and Exchange Commission on
    February&#160;27, 2008 and incorporated herein by reference.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (13) </TD>
    <TD></TD>
    <TD valign="bottom">
    Filed as an exhibit to the registrant&#146;s Current Report on
    <FONT style="white-space: nowrap">Form&#160;8-K</FONT>
    filed with the Securities and Exchange Commission on
    December&#160;12, 2008 and incorporated herein by reference.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (14) </TD>
    <TD></TD>
    <TD valign="bottom">
    Filed as an exhibit to the registrant&#146;s Current Report on
    <FONT style="white-space: nowrap">Form&#160;8-K</FONT>
    filed with the Securities and Exchange Commission on
    April&#160;16, 2009 and incorporated herein by reference.</TD>
</TR>

</TABLE>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    II-4
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (15) </TD>
    <TD></TD>
    <TD valign="bottom">
    Filed as an exhibit to the registrant&#146;s Current Report on
    <FONT style="white-space: nowrap">Form&#160;8-K</FONT>
    filed with the Securities and Exchange Commission on
    September&#160;30, 2009 and incorporated herein by reference.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (16) </TD>
    <TD></TD>
    <TD valign="bottom">
    Filed as an exhibit to the registrant&#146;s Current Report on
    <FONT style="white-space: nowrap">Form&#160;8-K</FONT>
    filed with the Securities and Exchange Commission on
    October&#160;5, 2009 and incorporated herein by reference.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="1%"></TD>
    <TD width="1%"></TD>
    <TD width="98%"></TD>
</TR>

<TR>
    <TD valign="top">
    &#134; </TD>
    <TD></TD>
    <TD valign="bottom">
    To be filed by amendment.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    + </TD>
    <TD></TD>
    <TD valign="bottom">
    Indicates management contract or compensatory plan.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    * </TD>
    <TD></TD>
    <TD valign="bottom">
    The registrant has been granted confidential treatment with
    respect to certain portions of this exhibit (indicated by
    asterisks), which have been filed separately with the Securities
    and Exchange Commission.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="5%"></TD>
    <TD width="91%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    (b)&#160;&#160;
</TD>
    <TD align="left">
    <I>Financial Statement Schedules</I>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    No financial statement schedules are provided because the
    information called for is not required or is shown either in the
    financial statements or the notes thereto.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="9%"></TD>
    <TD width="91%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">Item&#160;17.<I>&#160;&#160;</I></FONT></B>
</TD>
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">Undertakings.</FONT></I></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Insofar as indemnification for liabilities arising under the
    Securities Act may be permitted to directors, officers and
    controlling persons of the Registrant pursuant to the foregoing
    provisions, or otherwise, 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
    Securities 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 whether such
    indemnification by it is against public policy as expressed in
    the Securities Act and will be governed by the final
    adjudication of such issue.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The undersigned Registrant hereby undertakes that:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (1)&#160;For purposes of determining any liability under the
    Securities Act, the information omitted from the form of
    prospectus filed as part of this Registration Statement in
    reliance upon Rule&#160;430A and contained in a form of
    prospectus filed by the Registrant pursuant to
    Rule&#160;424(b)(1) or (4)&#160;or 497(h) under the Securities
    Act shall be deemed to be part of this Registration Statement as
    of the time it was declared effective.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (2)&#160;For the purpose of determining any liability under the
    Securities Act, each post-effective amendment that contains a
    form of prospectus 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.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    II-5
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">SIGNATURES</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Pursuant to the requirements of the Securities Act, the
    Registrant has duly caused this Registration Statement to be
    signed on its behalf by the undersigned, thereunto duly
    authorized, in the City of Rockville, State of Maryland, on the
    16th&#160;day of April, 2010.
</DIV>

<DIV style="margin-top: 24pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 49%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>REGENERX BIOPHARMACEUTICALS, INC.</B>
</DIV>

<DIV style="margin-top: 24pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="49%"></TD>
    <TD width="4%"></TD>
    <TD width="47%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    By:&#160;
</TD>
    <TD align="center">
    <DIV style="display:inline; text-align:center; width:90%">/s/&#160;&#160;J.J.
    Finkelstein</DIV>
</TD>
</TR>

</TABLE>

<DIV style="font-size: 2pt; margin-left: 53%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV align="center" style="margin-left: 53%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    J.J. Finkelstein
</DIV>

<DIV align="center" style="margin-left: 53%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>President and Chief Executive Officer</I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    KNOW ALL BY THESE PRESENTS, that each person whose signature
    appears below hereby constitutes and appoints J.J. Finkelstein
    and C. Neil Lyons, and each of them, his true and lawful agent,
    proxy and attorney-in-fact, with full power of substitution and
    resubstitution, for him and in his name, place and stead, in any
    and all capacities, to (i)&#160;act on, sign and file with the
    Securities and Exchange Commission any and all amendments
    (including post-effective amendments) to this registration
    statement together with all schedules and exhibits thereto and
    any subsequent registration statement filed pursuant to
    Rule&#160;462(b) under the Securities Act of 1933, as amended,
    together with all schedules and exhibits thereto, (ii)&#160;act
    on, sign and file such certificates, instruments, agreements and
    other documents as may be necessary or appropriate in connection
    therewith, (iii)&#160;act on and file any supplement to any
    prospectus included in this registration statement or any such
    amendment or any subsequent registration statement filed
    pursuant to Rule&#160;462(b) under the Securities Act of 1933,
    as amended, and (iv)&#160;take any and all actions which may be
    necessary or appropriate to be done, as fully for all intents
    and purposes as he might or could do in person, hereby
    approving, ratifying and confirming all that such agent, proxy
    and attorney-in-fact or any of his substitutes may lawfully do
    or cause to be done by virtue thereof.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Pursuant to the requirements of the Securities Act, this
    Registration Statement has been signed by the following persons
    in the capacities and on the dates indicated.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="3%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="37%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="40%">&nbsp;</TD>	<!-- colindex=03 type=maindata -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="13%">&nbsp;</TD>	<!-- colindex=04 type=maindata -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Signature</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Title</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Date</B>
</DIV>
</TD>
</TR>
<TR style="line-height: 12pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom">
<TD colspan="3" align="center" valign="top">
    <DIV style="display:inline; text-align:center; width:90%">/s/&#160;&#160;J.J.
    Finkelstein</DIV><BR>
    <DIV style="font-size: 2pt; margin-left: 0%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV>J.J.
    Finkelstein
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="top">
    President and Chief Executive Officer and Director <I>(Principal
    Executive Officer)</I>
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="top">
    April 16, 2010
</TD>
</TR>
<TR valign="bottom" style="line-height: 12pt">
<TD colspan="3">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD colspan="3" align="center" valign="top">
    <DIV style="display:inline; text-align:center; width:90%">/s/&#160;&#160;C.
    Neil Lyons</DIV><BR>
    <DIV style="font-size: 2pt; margin-left: 0%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV>C.
    Neil Lyons
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="top">
    Chief Financial Officer<BR>
    <I>(Principal Accounting and Financial Officer)</I>
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="top">
    April 16, 2010
</TD>
</TR>
<TR valign="bottom" style="line-height: 12pt">
<TD colspan="3">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD colspan="3" align="center" valign="top">
    <DIV style="display:inline; text-align:center; width:90%">/s/&#160;&#160;Allan
    L. Goldstein</DIV><BR>
    <DIV style="font-size: 2pt; margin-left: 0%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV>Allan
    L. Goldstein
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="top">
    Chairman of the Board of Directors
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="top">
    April 16, 2010
</TD>
</TR>
<TR valign="bottom" style="line-height: 12pt">
<TD colspan="3">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD colspan="3" align="center" valign="top">
    <DIV style="display:inline; text-align:center; width:90%">/s/&#160;&#160;Richard
    J. Hindin</DIV><BR>
    <DIV style="font-size: 2pt; margin-left: 0%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV>Richard
    J. Hindin
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="top">
    Director
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="top">
    April 16, 2010
</TD>
</TR>
<TR valign="bottom" style="line-height: 12pt">
<TD colspan="3">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD colspan="3" align="center" valign="top">
    <DIV style="display:inline; text-align:center; width:90%">/s/&#160;&#160;Joseph
    C. McNay</DIV><BR>
    <DIV style="font-size: 2pt; margin-left: 0%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV>Joseph
    C. McNay
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="top">
    Director
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="top">
    April 16, 2010
</TD>
</TR>
<TR valign="bottom" style="line-height: 12pt">
<TD colspan="3">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD colspan="3" align="center" valign="top">
    <DIV style="display:inline; text-align:center; width:90%">/s/&#160;&#160;Mauro
    Bove</DIV><BR>
    <DIV style="font-size: 2pt; margin-left: 0%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV>Mauro
    Bove
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="top">
    Director
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="top">
    April 16, 2010
</TD>
</TR>
<TR valign="bottom" style="line-height: 12pt">
<TD colspan="3">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD colspan="3" align="center" valign="top">
    <DIV style="display:inline; text-align:center; width:90%">/s/&#160;&#160;L.
    Thompson Bowles</DIV><BR>
    <DIV style="font-size: 2pt; margin-left: 0%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV>L.
    Thompson Bowles
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="top">
    Director
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="top">
    April 16, 2010
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    II-6
</DIV><!-- END PAGE WIDTH -->
</BODY>
</HTML>
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sv1
As filed with the Securities and
    Exchange Commission on April 16, 2010
Registration
No. 333-
UNITED STATES SECURITIES AND
    EXCHANGE COMMISSION
Washington, D.C.
    20549
Form S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
REGENERX BIOPHARMACEUTICALS,
    INC.
(Exact name of registrant as
    specified in its charter)
Delaware
2834
52-1253406
(State or other jurisdiction
    of
incorporation or organization)
(Primary Standard Industrial
Classification Code Number)
(I.R.S. Employer
Identification Number)
15245 Shady Grove Road,
    Suite 470
Rockville, MD 20850
(301) 208-9191
(Address, including
    zip code, and telephone number, including area code, of
    registrant's principal executive offices)
J.J. Finkelstein
President and Chief Executive Officer
15245 Shady Grove Road, Suite 470
Rockville, MD 20850
(301) 208-9191
(Name, address,
    including zip code, and telephone number, including area code,
    of agent for service)
Copies to:
Darren K. DeStefano, Esq.
Brian F. Leaf, Esq.
Cooley Godward Kronish LLP
One Freedom Square, Reston Town Center
11951 Freedom Drive
Reston, VA
20190-5656
(703) 456-8000
Steven M. Skolnick, Esq.
Lowenstein Sandler PC
65 Livingston Avenue
Roseland, NJ 07068-1791
(973) 597-2382
Approximate date of commencement of proposed sale to the
    public:
As soon as practicable after the
    effective date of this registration statement.
If any of the securities being registered on this Form are to be
    offered on a delayed or continuous basis pursuant to
    Rule 415 under the Securities Act of 1933, check the
    following
    box.
o
If this Form is filed to register additional securities for an
    offering pursuant to Rule 462(b) 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.
o
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.
o
If this Form is a post-effective amendment filed pursuant to
    Rule 462(d) under the Securities Act, check the following
    box and list the Securities Act registration number of the
    earlier effective registration statement for the same
    offering.
o
CALCULATION
    OF REGISTRATION FEE
Proposed Maximum
Proposed Maximum
Amount of
Title of Each Class of
Amount to be
Offering
Aggregate
Registration
Securities Being Registered
Registered(1)
Price per Unit(2)
Offering Price(2)
Fee
Units, each consisting
    of           shares
    of common stock, $0.001 par value per share, and a warrant
    to
    purchase           shares
    of common stock
$
$
$
Common Stock, $0.001 par value per share, included in the
    Units
$
$
$
(3
)
Warrants included in the Units
$
$
$
(3
)
Shares of common stock underlying the warrants included in the
    Units
$
$
$
Underwriters' Warrants
$
$
$
(3
)
Shares of common stock underlying the Underwriters' Warrants
$
$
$
(3
)
Total
$
$
12,000,000
$
855.60
(1)
Includes          
    units, consisting
    of           shares
    of common stock and warrants to
    purchase           shares
    of common stock, which may be issued upon exercise of a
45-day
option granted to the underwriters to cover over-allotments, if
    any.
(2)
Estimated solely for purposes of
    computing the amount of the registration fee pursuant to
    Rule 457(o) under the Securities Act.
(3)
No fee pursuant to Rule 457(g)
    under the Securities Act.
Indicate by check mark whether the registrant is a large
    accelerated filer, an accelerated filer, a non-accelerated
    filer, or a smaller reporting company. See the definitions of
    "large accelerated filer," "accelerated
    filer" and "smaller reporting company" in Rule
12b-2
of the
    Exchange Act. (Check one):
Large accelerated filer
o
Accelerated filer
o
Non-accelerated filer
o
(Do not check if a smaller reporting company)
Smaller reporting company
þ
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 that
    specifically states that this Registration Statement shall
    thereafter become effective in accordance with Section 8(a)
    of the Securities Act of 1933, as amended, or until the
    registration statement shall become effective on such date as
    the Commission, acting pursuant to said Section 8(a), may
    determine.
The
information in this prospectus is not complete and may be
changed. We may not sell these securities until the registration
statement filed with the Securities and Exchange Commission is
effective. This prospectus is not an offer to sell these
securities and we are not soliciting offers to buy these
securities in any state where the offer or sale is not
permitted.
SUBJECT TO COMPLETION, DATED
    APRIL 16, 2010
PROSPECTUS
Units
Common Stock
Warrants
We are
    offering          
    units, each unit consisting
    of           shares
    of our common stock and a warrant to
    purchase           shares
    of common stock. The units will separate immediately and the
    common stock and warrants will be issued separately. There will
    be no market for the units. Each unit will be sold at a purchase
    price of $     .
Our common stock is currently listed on the NYSE Amex stock
    exchange under the symbol "RGN." On April 15,
    2010, the last reported sale price of our common stock on the
    NYSE Amex was $0.57 per share. Currently, no public market
    exists for the warrants offered by this prospectus. We intend to
    apply for listing of the warrants on the NYSE Amex under the
    symbol
    "          ."
    The warrants will begin trading on or promptly after the date of
    this prospectus, subject to listing on NYSE Amex.
Investing
    in our securities involves a high degree of risk. See "Risk
    Factors"
beginning on page 7 of this prospectus for a discussion of
    information that should be
considered in connection with an investment in our
    securities.
Per Unit
Total
Public offering price
$
$
Underwriting discounts and commissions(1)
$
$
Proceeds, before expenses, to us
$
$
(1)
Does not include a corporate finance fee in the amount of 1% of
    the gross proceeds of the offering or warrants to be issued to
    the representative of the underwriters. See
    "Underwriting" beginning on page    of
    this prospectus.
We have granted the underwriters a
45-day
option to purchase up to an
    additional          units
    from us on the same terms and conditions as set forth above.
Neither the Securities and Exchange Commission nor any state
    securities regulators have approved or disapproved of these
    securities or determined if this prospectus is truthful or
    complete. Any representation to the contrary is a criminal
    offense.
The underwriters expect to deliver the units to purchasers on or
    about          ,
    2010.
Maxim
    Group LLC
Boenning & Scattergood, Inc.
The date of this prospectus
    is          ,
    2010.
TABLE OF
    CONTENTS
Page
Prospectus Summary
1
Risk Factors
7
Special Note Regarding Forward-Looking
    Statements
22
Use of Proceeds
24
Capitalization
25
Price Range of Common Stock and Dividend
    Policy
26
Dilution
26
Selected Financial Data
28
Management's Discussion and Analysis of
    Financial Condition and Results of Operations
29
Business
37
Management
47
Executive Compensation
53
Certain Relationships and Related Party
    Transactions
60
Principal Stockholders
62
Description of Securities
64
Underwriting
69
Legal Matters
75
Experts
75
Where You Can Find Additional Information
75
Disclosure of Commission Position on
    Indemnification for Securities Act Liability
76
Index to Financial Statements
F-1
You should rely only on the information contained in this
    prospectus and any related free writing prospectus we may
    authorize to be delivered to you. We have not, and the
    underwriters have not, authorized any person to provide you with
    different information. If anyone provides you with different or
    inconsistent information, you should not rely on it. Neither
    this prospectus nor any related free writing prospectus is an
    offer to sell, nor are they seeking an offer to buy, these
    securities in any state where the offer or solicitation is not
    permitted. The information contained in this prospectus is
    complete and accurate as of the date on the front cover of this
    prospectus, but information may have changed since that date.
This prospectus includes statistical and other industry and
    market data that we obtained from industry publications and
    research, surveys and studies conducted by third parties.
    Industry publications and third-party research, surveys and
    studies generally indicate that their information has been
    obtained from sources believed to be reliable, although they do
    not guarantee the accuracy or completeness of such information.
    While we believe that these industry publications and
    third-party research, surveys and studies are reliable, we have
    not independently verified such data and we do not make any
    representation as to the accuracy of the information.
PROSPECTUS
    SUMMARY
The items in the following summary are described in more
    detail later in this prospectus. This summary does not contain
    all of the information you should consider. Before investing in
    our securities, you should read the entire prospectus carefully,
    including the "Risk Factors" beginning on page 7
    and the financial statements and related notes beginning on
page F-1.
Unless the context indicates otherwise, (i) as used in this
    prospectus, the terms "RegeneRx," "our
    company," "we," "us" and
    "our" refer to RegeneRx Biopharmaceuticals, Inc. and
    (ii) the information in this prospectus assumes no exercise of
    the underwriters' over-allotment option.
Overview
We are a biopharmaceutical company focused on the development of
    a novel therapeutic peptide, Thymosin beta 4, or Tß4, for
    tissue and organ protection, repair, and regeneration. We have
    formulated Tß4 into three distinct product candidates
    currently in clinical development:
•
RGN-352, an injectable product candidate to treat cardiovascular
    diseases, central nervous system diseases, and other medical
    indications that may be treated by systemic administration, for
    which we intend to initiate a Phase 2 clinical trial in the
    second half of 2010;
•
RGN-259, a topical eye drop for ophthalmic indications that was
    evaluated in a small Phase 2 clinical trial and is
    currently being supported in compassionate use studies; and
•
RGN-137, a topically applied gel for chronic dermal wounds and
    reduction of scar tissue that is currently in a Phase 2 clinical
    trial for the treatment of the skin defect epidermolysis
    bullosa, or EB.
We have a fourth product candidate, RGN-457, in preclinical
    development. RGN-457 is an inhaled formulation of Tß4
    targeting cystic fibrosis and other pulmonary diseases.
In addition to our four pharmaceutical product candidates, we
    are also pursuing the commercial development of peptide
    fragments and derivatives of Tß4 for cosmeceutical use.
    Cosmeceuticals are cosmetic products with biologically active
    ingredients. We believe the biological activities of these
    fragments may be useful, for example, in developing novel
    cosmeceutical products for the anti-aging market.
The following chart provides an overview of our product
    candidates and their development status:
We are engaged in research collaborations with at least 25
    research institutions throughout the world, which we believe
    indicates significant independent research interest in the
    clinical potential of Tß4. Most of these
1
institutions, including the U.S. military, are conducting
    research on Tß4 at their own expense. We have also entered
    into a license agreement with the U.S. National Institutes
    of Health, or NIH, under which we received an exclusive
    worldwide license for Tß4 for several clinical indications.
    We have similarly in-licensed other rights related to Tß4
    that we believe support our current or expected future clinical
    development. We have applied for or hold over 60 worldwide
    patents on peptide compositions, uses and formulations related
    to cardiac, central nervous system, ophthalmic and dermal
    indications, among others, as well as for cosmetic and consumer
    products.
Our
    Tß4-Based Product Candidates
Tß4 is a naturally occurring
43-amino
acid peptide that was originally isolated from bovine thymus
    glands. Preclinical animal research has identified several
    important biological activities of Tß4 that we believe make
    it potentially useful as a wound healing, repair and tissue
    regenerating agent, including:
•
signaling adult epicardial progenitor cells, or EPCs, to
    differentiate into coronary blood vessels;
•
forming cardiomyocytes that repair damaged heart tissue;
•
triggering the maturation of stem cells into cells that produce
    myelin, the outer covering of nerve cells in the central nervous
    system;
•
improving neurologic functional recovery;
•
regulating actin, which is critical to cell structure and
    mobility;
•
stimulating angiogenesis, or blood vessel development;
•
reducing inflammation, which is implicated in many medical
    indications;
•
stimulating the formation of collagen and up-regulation of
    laminin-5 to accelerate tissue repair; and
•
preventing apoptosis, or programmed cell death.
We have developed a synthetic version of Tß4 and have
    formulated it for various routes of administration, targeting
    medical indications with significant unmet needs and market
    potential, as well as orphan indications that we believe could
    also provide substantial commercial value. Our product
    candidates are intended to provide solutions to these medical
    indications and to offer improvements to current standards of
    care.
RGN-352
Our product candidate RGN-352 is an injectable formulation of
    Tß4 for systemic administration. We have initially targeted
    RGN-352 for patients who have suffered an acute myocardial
    infarction, or AMI, commonly known as a heart attack.
    Preclinical research published in the scientific journal
Nature
has indicated that Tß4 can guide specific
    types of stem cells from the outer layer of the heart to
    generate new myocardial blood vessels and tissue at injured
    sites. During 2009, we completed a Phase 1 clinical trial
    evaluating the safety of RGN-352 in 60 healthy subjects. The
    product candidate was well-tolerated, and there were no reported
    drug-related adverse events.
Based on the results of this Phase 1 trial, and subject to
    available funding, we intend to initiate a Phase 2 clinical
    trial in the second half of 2010 to evaluate RGN-352's
    ability to salvage and regenerate damaged cardiac tissue and
    improve cardiac function after a heart attack. We intend to use
    a portion of the proceeds of this offering to initiate and
    conduct this Phase 2 clinical trial, although depending on the
    amount of proceeds we may not be able to complete the trial
    without additional capital. Depending on our capital resources,
    we may conduct the trial while also continuing strategic
    partnership discussions with biotechnology and pharmaceutical
    companies for the further development of RGN-352.
Recent preclinical research published in the scientific journal
Neuroscience
also indicates that RGN-352 may prove useful
    for patients with multiple sclerosis, or MS, and stroke. In
    research involving mice, the administration of Tß4 resulted
    in statistically significant improvement in neurological
    functional recovery. Based on this research, we intend to
    support a proposed Phase 1/2 clinical trial to be conducted at a
    major U.S. medical center under a physician-sponsored
    investigational new drug application, or IND, in order to
2
evaluate the therapeutic potential of RGN-352 in patients with
    MS. We are planning to supply RGN-352 and provide clinical and
    regulatory guidance for the trial. We believe that we can
    support this trial from our existing capital resources, although
    we intend to use a portion of the proceeds from this offering to
    provide additional support.
RGN-259
Our product candidate RGN-259 is a sterile topical eye drop
    formulation of Tß4 for ophthalmic indications. Emerging
    human clinical data from two compassionate use studies have
    demonstrated the ability of RGN-259 to repair and regenerate
    corneal tissue in patients with non-healing corneal lesions in
    the eye. This data has been reported at medical conferences and
    published in scientific journals and provided the
proof-of-concept
data that we initially sought for RGN-259. Based on these data
    and slower than expected patient accrual in a Phase 2 ophthalmic
    wound healing trial that we had initiated with RGN-259, in 2009,
    we closed the Phase 2 trial after enrolling the initial low-dose
    cohort. The results from evaluating this initial cohort
    indicated increased corneal epithelial thickening and reduced
    cell and flare inflammation in the Tß4-treated patients, as
    compared to patients who were administered placebo. We believe
    these results are indicative of Tß4's activities in
    corneal re-epithelialization and healing.
We are continuing to support the development of RGN-259 in
    ophthalmic indications under compassionate use INDs and expect
    to report final patient data from these trials in the third
    quarter of 2010. We are also planning to support a
    physician-sponsored clinical trial in patients with dry eye
    secondary to graft versus host disease, or GvHD, in order to
    gain further insight into RGN-259's ability to repair and
    regenerate ophthalmic tissues. Our support includes
    manufacturing and supplying RGN-259 for the trial and providing
    regulatory and clinical guidance. We are continuing to
    collaborate with the U.S. military to evaluate the potential of
    RGN-259 to prevent or reduce eye damage caused by chemical
    warfare agents. We are also engaged in discussions with
    potential partners regarding the clinical development of this
    product candidate. Once enough human data is generated, we
    intend to seek strategic partnerships with one or more
    ophthalmic specialty companies.
RGN-137
Our product candidate RGN-137 is a topical gel formulation of
    Tß4 intended to promote dermal wound healing and tissue
    regeneration. Preclinical research has demonstrated that
    Tß4 can accelerate dermal regeneration after a wound, while
    more recent research indicates that Tß4 can reduce scarring
    after injury in the skin and heart. In 2005, based on research
    conducted at the NIH, we initiated a series of Phase 2 clinical
    trials to evaluate RGN-137 for the treatment of three different
    types of skin wounds.
The first trial evaluated the use of RGN-137 in the treatment of
    patients with EB, which is a genetic defect that results in
    fragile skin and other epidermal tissues that can blister at the
    slightest trauma or friction, creating a wound that at times
    does not heal or heals poorly. A portion of this trial was
    funded by a grant from the FDA due to the orphan nature of the
    indication. Despite the small patient population with this
    disease, we are continuing to enroll patients in this Phase 2
    trial and expect to complete it in late 2010 or early 2011. Once
    we complete our Phase 2 EB trial, we will analyze the data in
    conjunction with our two other completed Phase 2 trials, along
    with the preclinical data indicating Tß4's ability to
    reduce scarring, at which time we will further evaluate our
    strategy for the clinical development of RGN-137.
Relationship
    with Sigma-Tau
Sigma-Tau Industrie Farmaceutiche Riunite S.p.A. is an
    international pharmaceutical company and an affiliate of
    Sigma-Tau Finanziaria S.p.A., which together with its affiliates
    comprise our largest stockholder group and are referred to in
    this prospectus as Sigma-Tau. Sigma-Tau has licensed certain
    rights to our product candidates for marketing in Europe and
    other surrounding countries, for which we would be the exclusive
    supplier of Tß4 and would receive royalties on commercial
    sales, if any. Sigma-Tau conducted and funded our completed
    Phase 2 trial in Italy and Poland to evaluate RGN-137 for the
    treatment of patients with venous stasis ulcers.
3
Commercialization
    Strategy
Our strategy is to seek strategic partners and to out-license
    rights for each drug candidate and our peptide fragments, with
    certain exceptions. For example, we believe we can commercially
    develop and market
RGN-137
for
    EB, since the patient population is small and well-defined, as
    is the population of pediatric dermatologists who specialize in
    treating this disease. We continue to hold strategic discussions
    with pharmaceutical and biotechnology companies at each
    development milestone for each product candidate.
Corporate
    Information
We were incorporated in Delaware in 1982 under the name Alpha 1
    Biomedicals, Inc. In 2000, we changed our corporate name to
    RegeneRx Biopharmaceuticals, Inc. at which time we began hiring
    our current management team. Our principal executive office is
    located at 15245 Shady Grove Road, Suite 470, Rockville,
    Maryland 20850. Our telephone number is
(301) 208-9191.
Our website address is
www.regenerx.com.
Information
    contained in, or accessible through, our website does not
    constitute a part of, and is not incorporated into, this
    prospectus.
We use
    RegeneRx
tm
and the RegeneRx logo as trademarks and service marks in the
    United States. All other trademarks or trade names referred to
    in this prospectus are the property of their respective owners.
4
The
    Offering
Securities offered by us
units,
    each unit consisting
    of          
    shares of common stock, par value $0.001 per share, and a
    tradeable warrant to
    purchase          
    shares of common stock (each, a "unit").
Common stock to be outstanding after
this offering
shares
Terms of the warrants offered by us
Each warrant will be exercisable during the period commencing on
    the date of original issuance and ending five years thereafter
    at an exercise price of $      per
    share of common stock. See "Description of
    Securities." This prospectus also relates to the offering
    of the shares of common stock issuable upon exercise of the
    warrants.
Redemption of the warrants issued as
part of the units
In the event the closing sale price of our common stock is at
    least $      per share for any 20
    trading days within a 30 consecutive trading day period, we may
    call the warrants for redemption, at a redemption price of $0.01
    per warrant, by providing at least 30 days notice to each
    warrant holder. Holders of the warrants will be entitled to
    exercise the warrants prior to the date scheduled for
    redemption, but there can be no assurance that the price of our
    common stock will exceed the call price or the warrant exercise
    price after the redemption call is made.
Over-allotment option
units
Use of proceeds
We intend to use the net proceeds from this offering, and our
    existing cash and cash equivalents, to fund ongoing research and
    development activities, including contemplated clinical trials,
    and for general corporate purposes, including working capital.
    See "Use of Proceeds."
Market for our securities
Our common stock is currently listed on the NYSE Amex under the
    symbol "RGN." We intend to apply for listing of the
    warrants underlying the units on the NYSE Amex. There will be no
    market for the units.
Risk factors
This investment involves a high degree of risk. See "Risk
    Factors" for a discussion of factors you should consider
    carefully before making an investment decision.
The number of shares of our common stock that will be
    outstanding immediately after this offering is based on
    60,406,828 shares of common stock outstanding as of
    March 31, 2010, and excludes:
•
4,914,112 shares of our common stock issuable upon the
    exercise of stock options outstanding under our 2000 stock
    option plan as of March 31, 2010, at a weighted average
    exercise price of $1.53 per share;
•
1,550,888 shares of our common stock available for future
    issuance under our 2000 stock option plan;
•
7,933,851 shares of our common stock issuable upon the
    exercise of outstanding warrants as of March 31, 2010, at a
    weighted-average exercise price of $2.01 per share; and
•
shares issuable upon exercise of warrants to be issued in
    connection with this offering.
Except as otherwise indicated herein, all information in this
    prospectus, including the number of shares that will be
    outstanding after this offering, assumes or gives effect to:
•
no exercise of options or warrants outstanding on the date of
    this prospectus, except as specifically set forth
    herein; and
•
no exercise of the underwriters' over-allotment option.
5
Summary
    Financial Data
The following tables summarize our financial data. We have
    derived the following summary of our statement of operations
    data for the years ended December 31, 2009 and 2008 and
    balance sheet data as of December 31, 2009 from our audited
    financial statements appearing later in this prospectus. Our
    historical results are not necessarily indicative of the results
    that may be expected in the future. You should read the summary
    of our financial data set forth below together with our
    financial statements and the related notes to those statements,
    as well as "Management's Discussion and Analysis of
    Financial Condition and Results of Operations" appearing
    later in this prospectus.
We have presented the summary balance sheet data:
•
on an actual basis as of December 31, 2009; and
•
on an as adjusted basis to give effect to our sale
    of          
    units in this offering at a public offering price of
    $      per unit, after deducting
    underwriting discounts and commissions and estimated offering
    expenses payable by us.
Year Ended December 31,
2009
2008
Statement of Operations Data:
Sponsored research revenue
$
—
$
168,412
Operating expenses:
Research and development
3,724,514
7,149,808
General and administrative
2,781,790
3,805,346
Total operating expenses
6,506,304
10,955,154
Loss from operations
(6,506,304
)
(10,786,742
)
Interest income
12,444
149,777
Net loss
$
(6,493,860
)
$
(10,636,965
)
Basic and diluted net loss per share
$
(0.12
)
$
(0.21
)
Shares used to compute basic and diluted net loss per share
55,680,525
50,967,617
As of December 31, 2009
Actual
As Adjusted
Balance Sheet Data:
Cash and cash equivalents
$
4,355,768
Working capital
3,671,910
Total assets
4,583,754
Common stock
60,407
Additional
paid-in
capital
88,144,347
Accumulated deficit
(84,501,404
)
Total stockholders' equity
3,703,350
6
RISK
    FACTORS
Investing in our securities involves a high degree of risk.
    You should carefully consider the risks described below, as well
    as the other information included in this prospectus, before you
    decide to purchase our securities. If any of the following risks
    actually occurs, they may harm our business, prospects,
    financial condition and operating results. As a result, the
    trading price of our securities could decline and you could lose
    part or all of your investment.
Risks
    Related to Our Liquidity and Need for Financing
Even
    after giving effect to the proceeds of this offering, we
    estimate that our capital resources will only be sufficient to
    fund our operations into the third quarter of
    2011.
We intend to use the proceeds from this offering to fund our
    ongoing research and development activities; however, we may not
    be able to complete all of the trials we intend to initiate in
    2010 or beyond 2010 without additional funding. We intend to use
    a portion of the proceeds of this offering, together with our
    existing capital resources, to fund our existing initiatives in
    supporting a Phase 1/2 clinical trial of
RGN-352
in
    patients with multiple sclerosis, supporting ongoing
    compassionate use studies of RGN-259 in patients with corneal
    defects, and completing our ongoing Phase 2 trial of RGN-137 in
    patients with EB. We also intend to use a portion of the
    proceeds of this offering to initiate and conduct at least a
    portion of a Phase 2 clinical trial of RGN-352 in patients who
    have suffered an acute myocardial infarction. We expect that the
    Phase 2 trial design will allow for an interim review of patient
    data from an initial group of evaluated patients, and we
    currently expect that the proceeds of this offering will be
    sufficient to reach this point in the trial.
Our forecast of the period of time through which our financial
    resources will be adequate to support our operations is a
    forward-looking statement and involves risks and uncertainties,
    and actual results could vary as a result of a number of
    factors, including the factors discussed elsewhere in these risk
    factors. We have based this estimate on assumptions that may
    prove to be wrong, and we could use our available capital
    resources and the proceeds from this offering sooner than we
    currently expect.
In
    addition to our current development objectives, we will need
    substantial additional capital for the continued development of
    product candidates through marketing approval and for our
    longer-term future operations.
Beyond our current liquidity needs, we anticipate that
    substantial new capital resources will be required to continue
    our longer-term independent product development efforts,
    including any and all follow-on trials that will result from our
    current clinical programs beyond those currently contemplated,
    and to scale up manufacturing processes for our product
    candidates. The actual amount of funds that we will need will be
    determined by many factors, some of which are beyond our
    control. These factors include, without limitation:
•
the scope of our clinical trials, which is significantly
    influenced by the quality of clinical data achieved as trials
    are completed and the requirements established by regulatory
    authorities;
•
the speed with which we complete our clinical trials, which
    depends on our ability to attract and enroll qualifying patients
    and the quality of the work performed by our clinical
    investigators;
•
the time required to prosecute, enforce and defend our
    intellectual property rights, which depends on evolving legal
    regimes and infringement claims that may arise between us and
    third parties;
•
the ability to manufacture at scales sufficient to supply
    commercial quantities of any of our product candidates that
    receive regulatory approval, which may require levels of effort
    not currently anticipated; and
•
the successful commercialization of our product candidates,
    which will depend on our ability to either create or partner
    with an effective commercialization organization and which could
    be delayed or prevented by the emergence of equal or more
    effective therapies.
7
Emerging biotechnology companies like us may raise capital
    through corporate collaborations and by licensing intellectual
    property rights to other biotechnology or pharmaceutical
    enterprises. We intend to pursue this strategy, but there can be
    no assurance that we will be able to license our intellectual
    property or product development programs on commercially
    reasonable terms, if at all. There are substantial challenges
    and risks that will make it difficult to successfully implement
    any of these alternatives. If we are successful in raising
    additional capital through such a license or collaboration, we
    may have to give up valuable rights to our intellectual
    property. In addition, the business priorities of a strategic
    partner may change over time, which creates the possibility that
    the interests of the strategic partner in developing our
    technology may diminish, which could have a potentially material
    negative impact on the value of our interest in the licensed
    intellectual property or product candidates.
Further, if we raise additional funds by selling shares of our
    common stock or securities convertible into our common stock,
    the ownership interest of our existing stockholders may be
    significantly diluted. If additional funds are raised through
    the issuance of preferred stock or debt securities, these
    securities are likely to have rights, preferences and privileges
    senior to our common stock and may involve significant fees,
    interest expense, restrictive covenants or the granting of
    security interests in our assets.
Our failure to successfully address long-term liquidity
    requirements would have a material negative impact on our
    business, including the possibility of surrendering our rights
    to some technologies or product opportunities, delaying our
    clinical trials or ceasing our operations.
We
    have incurred losses since inception and expect to incur
    significant losses in the foreseeable future and may never
    become profitable.
We have not commercialized any product candidates to date and
    incurred net operating losses every year since our inception in
    1982. We believe these losses will continue for the foreseeable
    future, and may increase, as we pursue our product development
    efforts related to Tß4. As of December 31, 2009, our
    accumulated deficit totaled approximately $84.5 million.
As we expand our research and development efforts and seek to
    obtain regulatory approval of our product candidates to make
    them commercially viable, we anticipate substantial and
    increasing operating losses. Our ability to generate additional
    revenues and to become profitable will depend largely on our
    ability, alone or through the efforts of third-party licensees
    and collaborators, to efficiently and successfully complete the
    development of our product candidates, obtain necessary
    regulatory approvals for commercialization,
scale-up
commercial quantity manufacturing capabilities either internally
    or through third-party suppliers, and market our product
    candidates. There can be no assurance that we will achieve any
    of these objectives or that we will ever become profitable or be
    able to maintain profitability. Even if we do achieve
    profitability, we cannot predict the level of such
    profitability. If we sustain losses over an extended period of
    time and are not otherwise able to raise necessary funds to
    continue our development efforts and maintain our operations, we
    may be forced to cease operations.
We are
    currently not in compliance with NYSE Amex rules regarding the
    minimum shareholders' equity requirement and are at risk of
    being delisted from the NYSE Amex stock exchange, which may
    subject us to the SEC's penny stock rules and decrease the
    liquidity of our common stock.
Because of our historical losses from operations, NYSE Amex
    rules require that we maintain minimum stockholders' equity
    of $6 million, unless our market capitalization exceeds
    $50 million. We are not currently in compliance with either
    of these continued listing standards. In the second quarter of
    2009, we submitted a compliance plan to the NYSE Amex that
    forecasted our ability to regain compliance with the listing
    standards by October 2010. NYSE Amex has accepted our compliance
    plan, which is subject to periodic review by NYSE Amex to
    determine whether we are making progress consistent with the
    plan. Our compliance plan contemplates the raise of additional
    equity capital, such as through this offering. While the
    proceeds of this offering may enable us to achieve compliance
    with the $6 million stockholders' equity requirement,
    we will likely require additional capital in the future to
    maintain compliance with this continued listing standard.
    Additionally, we cannot assure you that we will meet or maintain
    compliance with the $50 million market
8
capitalization alternative standard after completion of this
    offering. Even if we raise net proceeds equal to or greater than
    the amount required to satisfy the $6 million
    stockholders' equity requirement, there can be no assurance
    that, because of our significant operating cash requirements, we
    will be able to maintain compliance with that requirement or
    remain eligible for continued listing on the NYSE Amex. Further,
    even if we raise net proceeds equal to or greater than the
    amount necessary to regain compliance, there can be no assurance
    that NYSE Amex will agree that we have satisfied the compliance
    plan.
If we do not achieve or maintain compliance with NYSE Amex
    listing rules, we expect that our common stock would be delisted
    from the NYSE Amex exchange. Following any such delisting, our
    common stock may be traded
over-the-counter
on the OTC Bulletin Board or in the "pink
    sheets." These alternative markets, however, are generally
    considered to be less efficient than, and not as broad as, the
    NYSE Amex exchange. If our common stock is delisted from NYSE
    Amex, there may be a limited market for our stock, trading in
    our stock may become more difficult and our share price could
    decrease even further. Specifically, you may not be able to
    resell your shares of common stock at or above the price you
    paid for such shares or at all.
In addition, if our common stock is delisted, our ability to
    raise additional capital may be impaired because of the less
    liquid nature of the OTC Bulletin Board and the pink
    sheets. While we cannot guarantee that we would be able to
    complete an equity financing on acceptable terms, or at all, we
    believe that dilution from any equity financing while our shares
    are quoted on the OTC Bulletin Board or the pink sheets
    would likely be substantially greater than if we were to
    complete the financing while our common stock is traded on the
    NYSE Amex exchange.
In the event our common stock is delisted, it may also become
    subject to penny stock rules. The SEC generally defines
    "penny stock" as an equity security that has a market
    price of less than $5.00 per share, subject to certain
    exceptions. We are not currently subject to the penny stock
    rules because our common stock qualifies for an exception to the
    SEC's penny stock rules for companies that have an equity
    security that is quoted on an exchange. However, if we were
    delisted, our common stock would become subject to the penny
    stock rules, which impose additional sales practice requirements
    on broker-dealers who sell our common stock. If our common stock
    were considered penny stock, the ability of broker-dealers to
    sell our common stock and the ability of our stockholders to
    sell their shares in the secondary market would be limited and,
    as a result, the market liquidity for our common stock would
    likely be adversely affected. We cannot assure you that trading
    in our securities will not be subject to these or other
    regulations in the future.
The
    report of our independent registered public accounting firm
    contains explanatory language that substantial doubt exists
    about our ability to continue as a going concern.
The report of our independent registered public accounting firm
    on our financial statements for the year ended December 31,
    2009 contains explanatory language that substantial doubt exists
    about our ability to continue as a going concern, without
    raising additional capital. Although we expect that the proceeds
    of this offering will provide us the ability to fund our
    operations through the third quarter of 2011, we will continue
    to have a need for additional financing after this offering,
    which we may not be able to complete either on favorable terms
    or at all. As a result, we cannot assure you that, after taking
    into account the proceeds of this offering and our anticipated
    expenditures for the remainder of 2010, the report of our
    independent registered public accounting firm for the year
    ending December 31, 2010 will not express substantial doubt
    about our ability to continue as a going concern. If this were
    to occur, we would once again face the need to obtain sufficient
    financing in the short term, and the failure to do so would, in
    all likelihood, create severe liquidity problems and cause us to
    have to curtail our operations. If we were to curtail our
    operations, we could be placed into bankruptcy or undergo
    liquidation, the result of which would adversely affect the
    value of our common stock.
9
Risks
    Related to Our Business and Operations
All of
    our drug candidates are based on a single compound that has yet
    to be proven effective in human subjects.
Our current primary business focus is the development of
    Tß4, and its analogues, derivatives and fragments, for the
    improvement of cardiac function, the acceleration of corneal
    healing, the treatment of non-healing wounds and other
    conditions. Unlike many pharmaceutical companies that have a
    number of unique chemical entities in development, we are
    dependent on a single molecule, formulated for different routes
    of administration and different clinical indications, for our
    potential commercial success. As a result, any common safety or
    efficacy concerns for Tß4-based products that cross
    formulations would have a much greater impact on our business
    prospects than if our product pipeline were more diversified.
We may
    never be able to commercialize our product
    candidates.
Although Tß4 has shown biological activity in
in vitro
and animal models, we cannot assure you
    that our product candidates will exhibit activity or importance
    in humans. Our drug candidates are still in research and
    development, and we do not expect them to be commercially
    available for the foreseeable future, if at all. Only a small
    number of research and development programs ultimately result in
    commercially successful drugs. Potential products that appear to
    be promising at early stages of development may not reach the
    market for a number of reasons. These include the possibility
    that the potential products may:
•
be found ineffective or cause harmful side effects during
    preclinical studies or clinical trials;
•
fail to receive necessary regulatory approvals;
•
be precluded from commercialization by proprietary rights of
    third parties;
•
be difficult to manufacture on a large scale; or
•
be uneconomical or otherwise fail to achieve market acceptance.
If any of these potential problems occurs, we may never
    successfully market Tß4-based products.
We are
    subject to intense government regulation, and we may not receive
    regulatory approvals for our drug candidates.
Our product candidates will require regulatory approvals prior
    to sale. In particular, therapeutic agents are subject to
    stringent approval processes, prior to commercial marketing, by
    the FDA and by comparable agencies in most foreign countries.
    The process of obtaining FDA and corresponding foreign approvals
    is costly and time-consuming, and we cannot assure you that such
    approvals will be granted. Also, the regulations we are subject
    to change frequently and such changes could cause delays in the
    development of our product candidates.
Three of our drug candidates are currently in the clinical
    stage, and we cannot be certain that we or our collaborators
    will successfully complete the clinical trials necessary to
    receive regulatory product approvals. The regulatory approval
    process is lengthy, unpredictable and expensive. To obtain
    regulatory approvals in the United States, we or a collaborator
    must ultimately demonstrate to the satisfaction of the
    U.S. Food and Drug Administration, or FDA, that our product
    candidates are sufficiently safe and effective for their
    proposed administration to humans. Many factors, known and
    unknown, can adversely impact clinical trials and the ability to
    evaluate a product candidate's safety and efficacy,
    including:
•
the FDA or other health regulatory authorities, or institutional
    review boards, or IRBs, do not approve a clinical trial protocol
    or place a clinical trial on hold;
•
suitable patients do not enroll in a clinical trial in
    sufficient numbers or at the expected rate, for reasons such as
    the size of the patient population, the proximity of patients to
    clinical sites, the eligibility criteria for the trial, the
    perceptions of investigators and patients regarding safety, and
    the availability of other treatment options;
10
•
clinical trial data is adversely affected by trial conduct or
    patient withdrawal prior to completion of the trial;
•
there may be competition with ongoing clinical trials and
    scheduling conflicts with participating clinicians;
•
patients experience serious adverse events, including adverse
    side effects of our drug candidates, for a variety of reasons
    that may or may not be related to our product candidates,
    including the advanced stage of their disease and other medical
    problems;
•
patients in the placebo or untreated control group exhibit
    greater than expected improvements or fewer than expected
    adverse events;
•
third-party clinical investigators do not perform the clinical
    trials on the anticipated schedule or consistent with the
    clinical trial protocol and good clinical practices, or other
    third-party organizations do not perform data collection and
    analysis in a timely or accurate manner;
•
service providers, collaborators or co-sponsors do not
    adequately perform their obligations in relation to the clinical
    trial or cause the trial to be delayed or terminated;
•
we are unable to obtain a sufficient supply of manufactured
    clinical trial materials;
•
regulatory inspections of manufacturing facilities, which may,
    among other things, require us or a
co-sponsor
to undertake corrective action or suspend the clinical trials;
•
the interim results of the clinical trial are inconclusive or
    negative;
•
the clinical trial, although approved and completed, generates
    data that is not considered by the FDA or others to be
    sufficient to demonstrate safety and efficacy; and
•
changes in governmental regulations or administrative actions
    affect the conduct of the clinical trial or the interpretation
    of its results.
There can be no assurance that our clinical trials will in fact
    demonstrate, to the satisfaction of the FDA and others, that our
    product candidates are sufficiently safe or effective. The FDA
    or we may also restrict or suspend our clinical trials at any
    time if either believes that we are exposing the subjects
    participating in the trials to unacceptable health risks.
Clinical trials for product candidates such as ours are often
    conducted with patients who have more advanced forms of a
    particular condition or other unrelated conditions. For example,
    in clinical trials for our product candidate RGN-137, we have
    studied patients who are not only suffering from chronic
    epidermal wounds but who are also older and much more likely to
    have other serious adverse conditions. During the course of
    treatment with our product candidates, patients could die or
    suffer other adverse events for reasons that may or may not be
    related to the drug candidate being tested. Further, and as a
    consequence of all of our drug candidates being based on
    Tß4, crossover risk exists such that a patient in one trial
    may be adversely impacted by one drug candidate, and that
    adverse event may have implications for our other trials and
    other drug candidates. However, even if unrelated to our product
    candidates, such adverse events can nevertheless negatively
    impact our clinical trials, and our business prospects would
    suffer.
These factors, many of which may be outside of our control, may
    have a negative impact on our business by making it difficult to
    advance product candidates or by reducing or eliminating their
    potential or perceived value. As a consequence, we may need to
    perform more or larger clinical trials than planned. Further, if
    we are forced to contribute greater financial and clinical
    resources to a study, valuable resources will be diverted from
    other areas of our business. If we fail to complete or if we
    experience material delays in completing our clinical trials as
    currently planned, or we otherwise fail to commence or complete,
    or experience delays in, any of our other present or planned
    clinical trials, including as a result of the actions of third
    parties upon which we rely for these functions, our ability to
    conduct our business as currently planned could materially
    suffer.
11
We may
    not successfully establish and maintain development and testing
    relationships with third-party service providers and
    collaborators, which could adversely affect our ability to
    develop our product candidates.
We have only limited resources, experience with and capacity to
    conduct requisite testing and clinical trials of our drug
    candidates. As a result, we rely and expect to continue to rely
    on third-party service providers and collaborators, including
    corporate partners, licensors and contract research
    organizations, or CROs, to perform a number of activities
    relating to the development of our drug candidates, including
    the design and conduct of clinical trials, and potentially the
    obtaining of regulatory approvals. For example, we currently
    rely on several third-party contractors to manufacture and
    formulate Tß4 into the product candidates used in our
    clinical trials, develop assays to assess Tß4's
    effectiveness in complex biological systems, recruit clinical
    investigators and sites to participate in our trials, manage the
    clinical trial process and collect, evaluate and report clinical
    results.
We may not be able to maintain or expand our current
    arrangements with these third parties or maintain such
    relationships on favorable terms. Our agreements with these
    third parties may also contain provisions that restrict our
    ability to develop and test our product candidates or that give
    third parties rights to control aspects of our product
    development and clinical programs. In addition, conflicts may
    arise with our collaborators, such as conflicts concerning the
    interpretation of clinical data, the achievement of milestones,
    the interpretation of financial provisions or the ownership of
    intellectual property developed during the collaboration. If any
    conflicts arise with our existing or future collaborators, they
    may act in their self-interest, which may be adverse to our best
    interests. Any failure to maintain our collaborative agreements
    and any conflicts with our collaborators could delay or prevent
    us from developing our product candidates. We and our
    collaborators may fail to develop products covered by our
    present and future collaborations if, among other things:
•
we do not achieve our objectives under our collaboration
    agreements;
•
we or our collaborators are unable to obtain patent protection
    for the products or proprietary technologies we develop in our
    collaborations;
•
we are unable to manage multiple simultaneous product
    development collaborations;
•
our collaborators become competitors of ours or enter into
    agreements with our competitors;
•
we or our collaborators encounter regulatory hurdles that
    prevent commercialization of our product candidates; or
•
we develop products and processes or enter into additional
    collaborations that conflict with the business objectives of our
    other collaborators.
We also have less control over the timing and other aspects of
    our clinical trials than if we conducted the monitoring and
    supervision entirely on our own. Third parties may not perform
    their responsibilities for our clinical trials on our
    anticipated schedule or consistent with a clinical trial
    protocol or applicable regulations. We also rely on clinical
    research organizations to perform much of our data management
    and analysis. They may not provide these services as required or
    in a timely manner. If any of these parties do not meet
    deadlines or follow proper procedures, including procedures
    required by law, the preclinical studies and clinical trials may
    take longer than expected, may be delayed or may be terminated,
    which would have a materially negative impact on our product
    development efforts. If we were forced to find a replacement
    entity to perform any of our preclinical studies or clinical
    trials, we may not be able to find a suitable entity on
    favorable terms or at all. Even if we were able to find a
    replacement, resulting delays in the tests or trials may result
    in significant additional expenditures and delays in obtaining
    regulatory approval for drug candidates, which could have a
    material adverse impact on our results of operations and
    business prospects.
We are
    subject to intense competition from companies with greater
    resources and more mature products, which may result in our
    competitors developing or commercializing products before or
    more successfully than we do.
We are engaged in a business that is highly competitive.
    Research and development activities for the development of drugs
    to treat indications within our focus are being sponsored or
    conducted by private and
12
public research institutions and by major pharmaceutical
    companies located in the United States and a number of foreign
    countries. Most of these companies and institutions have
    financial and human resources that are substantially greater
    than our own, and they have extensive experience in conducting
    research and development activities and clinical trials and in
    obtaining the regulatory approvals necessary to market
    pharmaceutical products that we do not have. As a result, they
    may develop competing products more rapidly that are safer, more
    effective, or have fewer side effects, or are less expensive, or
    they may develop and commercialize products that render our
    product candidates non-competitive or obsolete.
We have initially targeted our product candidate RGN-352 for
    cardiovascular indications. Most large pharmaceutical companies
    and many smaller biomedical companies are vigorously pursuing
    the development of therapeutics to treat patients after heart
    attacks and other cardiovascular indications. With respect to
    our product candidate RGN-259 for corneal defects, there are
    also numerous ophthalmic companies developing drugs for corneal
    wound healing and other
outside-of-the-eye
diseases and injuries. Amniotic membranes have been successfully
    used to treat corneal wounds in certain cases, as have topical
    steroids and antibacterial agents. With respect to our product
    candidate RGN-137 for wound healing, Johnson & Johnson
    has previously marketed
    Regranex
tm
for this purpose in patients with diabetic foot ulcers. Other
    companies, such as Novartis, are developing and marketing
    artificial skins, which we believe could also compete with
    RGN-137. Moreover, wound healing is a large and highly
    fragmented marketplace attracting many companies, large and
    small, to develop products for treating acute and chronic
    wounds, including, for example, honey-based ointments,
    hyperbaric oxygen therapy, and low frequency cavitational
    ultrasound.
We are also developing potential cosmeceutical products, which
    are loosely defined as products that bridge the gap between
    cosmetics and pharmaceuticals, for example, by improving skin
    texture and reducing the appearance of aging. This industry is
    intensely competitive, with potential competitors ranging from
    large multinational companies to very small specialty companies.
    New cosmeceutical products often have a short product life and
    are frequently replaced with newer products developed to address
    the latest trends in appearance and fashion. We may not be able
    to adapt to changes in the industry as quickly as larger and
    more experienced cosmeceutical companies. Further, larger
    cosmetics companies have the financial and marketing resources
    to effectively compete with smaller companies like us in order
    to sell products aimed at larger markets.
Even
    if approved for marketing, our technologies and product
    candidates are unproven and they may fail to gain market
    acceptance.
Our product candidates, all of which are based on the molecule
    Tß4, are new and unproven and there is no guarantee that
    health care providers or patients will be interested in our
    product candidates, even if they are approved for use. If any of
    our product candidates are approved by the FDA, our success will
    depend in part on our ability to demonstrate sufficient clinical
    benefits, reliability, safety, and cost effectiveness of our
    product candidates relative to other approaches, as well as on
    our ability to continue to develop our product candidates to
    respond to competitive and technological changes. If the market
    does not accept our product candidates, when and if we are able
    to commercialize them, then we may never become profitable.
    Factors that could delay, inhibit or prevent market acceptance
    of our product candidates may include:
•
the timing and receipt of marketing approvals;
•
the safety and efficacy of the products;
•
the emergence of equivalent or superior products;
•
the cost-effectiveness of the products; and
•
ineffective marketing.
It is difficult to predict the future growth of our business, if
    any, and the size of the market for our product candidates
    because the markets are continually evolving. There can be no
    assurance that our product candidates will prove superior to
    products that may currently be available or may become available
    in the future or that our research and development activities
    will result in any commercially profitable products.
13
We
    have no marketing experience, sales force or distribution
    capabilities. If our product candidates are approved, and we are
    unable to recruit key personnel to perform these functions, we
    may not be able to commercialize them
    successfully.
Although we do not currently have any marketable products, our
    ability to produce revenues ultimately depends on our ability to
    sell our product candidates if and when they are approved by the
    FDA and other regulatory authorities. We currently have no
    experience in marketing or selling pharmaceutical products, and
    we do not have a marketing and sales staff or distribution
    capabilities. Developing a marketing and sales force is also
    time-consuming and could delay the launch of new products or
    expansion of existing product sales. In addition, we will
    compete with many companies that currently have extensive and
    well-funded marketing and sales operations. If we fail to
    establish successful marketing and sales capabilities or fail to
    enter into successful marketing arrangements with third parties,
    our ability to generate revenues will suffer.
If we
    enter markets outside the United States our business will be
    subject to political, economic, legal and social risks in those
    markets, which could adversely affect our
    business.
There are significant regulatory and legal barriers to entering
    markets outside the United States that we must overcome if we
    seek regulatory approval to market our product candidates in
    countries other than the United States. We would be subject to
    the burden of complying with a wide variety of national and
    local laws, including multiple and possibly overlapping and
    conflicting laws. We also may experience difficulties adapting
    to new cultures, business customs and legal systems. Any sales
    and operations outside the United States would be subject to
    political, economic and social uncertainties including, among
    others:
•
changes and limits in import and export controls;
•
increases in custom duties and tariffs;
•
changes in currency exchange rates;
•
economic and political instability;
•
changes in government regulations and laws;
•
absence in some jurisdictions of effective laws to protect our
    intellectual property rights; and
•
currency transfer and other restrictions and regulations that
    may limit our ability to sell certain product candidates or
    repatriate profits to the United States.
Any changes related to these and other factors could adversely
    affect our business if and to the extent we enter markets
    outside the United States.
Governmental
    and third-party payors may subject any product candidates we
    develop to sales and pharmaceutical pricing controls that could
    limit our product revenues and delay
    profitability.
The successful commercialization of our product candidates, if
    they are approved by the FDA, will likely depend on our ability
    to obtain reimbursement for the cost of the product and
    treatment. Government authorities, private health insurers and
    other organizations, such as health maintenance organizations,
    are increasingly seeking to lower the prices charged for medical
    products and services. Also, the trend toward managed health
    care in the United States, the growth of healthcare maintenance
    organizations, and recently enacted legislation reforming
    healthcare and proposals to reform government insurance programs
    could have a significant influence on the purchase of healthcare
    services and products, resulting in lower prices and reducing
    demand for our product candidates. The cost containment measures
    that healthcare providers are instituting and any healthcare
    reform could reduce our ability to sell our product candidates
    and may have a material adverse effect on our operations. We
    cannot assure you that reimbursement in the United States or
    foreign countries will be available for any of our product
    candidates, and that any reimbursement granted will be
    maintained, or that limits on reimbursement available from
    third-party payors will not reduce the demand for, or the price
    of, our product candidates. The lack or inadequacy of
    third-party reimbursements for our product candidates would
    decrease the potential profitability of our operations. We
    cannot forecast what
14
additional legislation or regulation relating to the healthcare
    industry or third-party coverage and reimbursement may be
    enacted in the future, or what effect the legislation or
    regulation would have on our business.
We
    have no manufacturing or formulation capabilities and are
    dependent upon third-party suppliers to provide us with our
    product candidates. If these suppliers do not manufacture our
    product candidates in sufficient quantities, at acceptable
    quality levels and at acceptable cost, or if we are unable to
    identify suitable replacement suppliers if needed, our clinical
    development efforts could be delayed, prevented or
    impaired.
We do not own or operate manufacturing facilities and have
    little experience in manufacturing pharmaceutical products. We
    currently rely, and expect to continue to rely, primarily on
    peptide manufacturers to supply us with Tß4 for further
    formulation into our product candidates. We have engaged three
    separate smaller drug formulation contractors for the
    formulation of clinical grade product candidates, one for each
    of our three product candidates in clinical development. We
    currently do not have an alternative source of supply for either
    Tß4 or the individual drug candidates. If these suppliers,
    together or individually, are not able to supply us with either
    Tß4 or individual product candidates on a timely basis, in
    sufficient quantities, at acceptable levels of quality and at a
    competitive price, or if we are unable to identify a replacement
    manufacturer to perform these functions on acceptable terms as
    needed, our development programs could be seriously jeopardized.
The risks of relying solely on single suppliers for each of our
    product candidates include:
•
Their respective abilities to ensure quality and compliance with
    regulations relating to the manufacture of pharmaceuticals;
•
Their manufacturing capacity may not be sufficient or available
    to produce the required quantities of our product candidates
    based on our planned clinical development schedule, if at all;
•
They may not have access to the capital necessary to expand
    their manufacturing facilities in response to our needs;
•
Commissioning replacement suppliers would be difficult and
    time-consuming;
•
Individual suppliers may have used substantial proprietary
    know-how relating to the manufacture of our product candidates
    and, in the event we must find a replacement or supplemental
    supplier, our ability to transfer this know-how to the new
    supplier could be an expensive
and/or
time-consuming process;
•
An individual supplier may experience events, such as a fire or
    natural disaster, that force it to stop or curtail production
    for an extended period;
•
An individual supplier could encounter significant increases in
    labor, capital or other costs that would make it difficult for
    them to produce our products cost-effectively; or
•
An individual supplier may not be able to obtain the raw
    materials or validated drug containers in sufficient quantities,
    at acceptable costs or in sufficient time to complete the
    manufacture, formulation and delivery of our product candidates.
Our
    suppliers may use hazardous and biological materials in their
    businesses. Any claims relating to improper handling, storage or
    disposal of these materials could be time-consuming and costly
    to us, and we are not insured against such claims.
Our product candidates and processes involve the controlled
    storage, use and disposal by our suppliers of certain hazardous
    and biological materials and waste products. We and our
    suppliers and other collaborators are subject to federal, state
    and local regulations governing the use, manufacture, storage,
    handling and disposal of materials and waste products. Even if
    we and these suppliers and collaborators comply with the
    standards prescribed by law and regulation, the risk of
    accidental contamination or injury from hazardous materials
    cannot be completely eliminated. In the event of an accident, we
    could be held liable for any damages that result, and we do not
    carry insurance for this type of claim. We may also incur
    significant costs to comply with current or future environmental
    laws and regulations.
15
We
    face the risk of product liability claims, which could adversely
    affect our business and financial condition.
We may be subject to product liability claims as a result of our
    testing, manufacturing, and marketing of drugs. In addition, the
    use of our product candidates, when and if developed and sold,
    will expose us to the risk of product liability claims. Product
    liability may result from harm to patients using our product
    candidates, such as a complication that was either not
    communicated as a potential side effect or was more extreme than
    anticipated. We require all patients enrolled in our clinical
    trials to sign consents, which explain various risks involved
    with participating in the trial. However, patient consents
    provide only a limited level of protection, and it may be
    alleged that the consent did not address or did not adequately
    address a risk that the patient suffered. Additionally, we will
    generally be required to indemnify our clinical product
    manufacturers, clinical trial centers, medical professionals and
    other parties conducting related activities in connection with
    losses they may incur through their involvement in the clinical
    trials.
Our ability to reduce our liability exposure for human clinical
    trials and commercial sales, if any, of Tß4 is dependent in
    part on our ability to obtain sufficient product liability
    insurance or to collaborate with third parties that have
    adequate insurance. Although we intend to obtain and maintain
    product liability insurance coverage if we gain approval to
    market any of our product candidates, we cannot guarantee that
    product liability insurance will continue to be available to us
    on acceptable terms, or at all, or that its coverage will be
    sufficient to cover all claims against us. A product liability
    claim, even one without merit or for which we have substantial
    coverage, could result in significant legal defense costs,
    thereby potentially exposing us to expenses significantly in
    excess of our revenues, as well as harm to our reputation and
    distraction of our management.
If any
    of our key employees discontinue their services with us, our
    efforts to develop our business may be delayed.
We are highly dependent on the principal members of our
    management team. The loss of our chairman and chief scientific
    advisor, Allan Goldstein, or our chief executive officer, J.J.
    Finkelstein, could prevent or significantly delay the
    achievement of our goals. We have employment agreements with
    Dr. Goldstein and Mr. Finkelstein. For part of 2009,
    we effected salary reductions for certain of our employees,
    including Dr. Goldstein and Mr. Finkelstein. Although
    their salaries were restored effective as of October 1,
    2009, we cannot assure you that they, or other key employees,
    may elect to terminate their employment as a result of the
    salary reductions or for other reasons. In addition, we do not
    maintain a key man life insurance policy with respect to
    Dr. Goldstein or Mr. Finkelstein. In the future, we
    anticipate that we may need to add additional management and
    other personnel. Competition for qualified personnel in our
    industry is intense, and our success will depend in part on our
    ability to attract and retain highly skilled personnel. We
    cannot assure you that our efforts to attract or retain such
    personnel will be successful.
Mauro
    Bove, a member of our Board, is also a director and officer of
    entities affiliated with Sigma-Tau, a relationship which could
    give rise to a conflict of interest involving
    Mr. Bove.
Mauro Bove, a member of our Board of Directors, is also a
    director and officer of entities affiliated with Sigma-Tau,
    which collectively make up our largest stockholder group.
    Sigma-Tau has provided us with significant funding, may continue
    doing so in the future, and is also our strategic partner in
    Europe with respect to the development of certain of our drug
    candidates. During 2008 and 2009, we issued shares of common
    stock and common stock warrants to Sigma-Tau in four separate
    private placement financing transactions, but we retained the
    right to repurchase some of these shares under certain
    circumstances.
We have licensed certain rights to our product candidates
    generally for the treatment of dermal and internal wounds to
    Sigma-Tau. Under the license agreement, upon the completion of a
    Phase 2 clinical trial of either of these product candidates
    that yields positive results in terms of clinical efficacy and
    safety, Sigma-Tau is obligated to either make a $5 million
    milestone payment to us or to initiate and fund a pivotal Phase
    3 clinical trial of the product candidate. In 2009, we completed
    two Phase 2 clinical trials of RGN-137 in the treatment of
    pressure ulcers and venous stasis ulcers. However, due to the
    lack of statistical significance of the
16
reported efficacy results, these trials are not sufficient to
    trigger the milestone obligation described above. There can be
    no assurance that we will ever receive this payment or be able
    to initiate a pivotal Phase 3 clinical trial of RGN-137 that
    would be funded by Sigma-Tau. As a result of
    Mr. Bove's relationship with Sigma-Tau, there could be
    a conflict of interest between Sigma-Tau and our other
    stockholders with respect to these and other agreements and
    circumstances that may require the exercise of the Board's
    discretion with respect to Sigma-Tau. Any decision in the best
    interests of Sigma-Tau may not be in the best interest of our
    other stockholders.
Risks
    Related To Our Intellectual Property
We are
    heavily reliant on our license from the National Institutes of
    Health for the rights to Tß4, and any loss of these rights
    would adversely affect our business.
We have received an exclusive worldwide license to intellectual
    property discovered at the National Institutes of Health, or
    NIH, pertaining to the use of Tß4 in wound healing and
    tissue repair. The intellectual property rights from this
    license form the basis for our current commercial development
    focus with Tß4. This license terminates upon the last to
    expire of the patent applications that are filed, or any patents
    that may issue from such applications, in connection with the
    license. This license requires us to pay a minimum annual
    royalty to the NIH, regardless of the success of our product
    development efforts, plus certain other royalties upon the sale
    of products created by the intellectual property granted under
    the license. This license may be terminated for a number of
    reasons, including our non-payment of the royalty or lack of
    continued product development, among others. While to date we
    believe that we have complied with all requirements to maintain
    the license, the loss of this license would have a material
    adverse effect on our business and business prospects and may
    require us to cease development of our current line of
    Tß4-based product candidates.
If we
    are not able to maintain adequate patent protection for our
    product candidates, we may be unable to prevent our competitors
    from using our technology or technology that we
    license.
Our success will depend in substantial part on our ability to
    obtain, defend and enforce patents, maintain trade secrets and
    operate without infringing upon the proprietary rights of
    others, both in the United States and abroad. Pursuant to an
    exclusive worldwide license from the NIH, we have exclusive
    rights to use Tß4 in the treatment of non-healing wounds.
    While patents covering our use of Tß4 have issued in some
    countries, we cannot guarantee whether or when corresponding
    patents will be issued, or the scope of any patents that may be
    issued, in other countries. We have attempted to create a
    substantial intellectual property portfolio, submitting patent
    applications for various compositions of matter, methods of use
    and fragments and derivatives of Tß4. We have also
    in-licensed other intellectual property rights from third
    parties that could be subject to the same risks as our own
    patents. If any of these patent applications do not issue, or do
    not issue in certain countries, or are not enforceable, the
    ability to commercialize Tß4 in various medical indications
    could be substantially limited or eliminated.
In addition, the patent positions of the products being
    developed by us and our collaborators involve complex legal and
    factual uncertainties. As a result, we cannot assure you that
    any patent applications filed by us, or by others under which we
    have rights, will result in patents being issued in the United
    States or foreign countries. In addition, there can be no
    assurance that any patents will be issued from any pending or
    future patent applications of ours or our collaborators, that
    the scope of any patent protection will be sufficient to provide
    us with competitive advantages, that any patents obtained by us
    or our collaborators will be held valid if subsequently
    challenged or that others will not claim rights in or ownership
    of the patents and other proprietary rights we or our
    collaborators may hold. Unauthorized parties may try to copy
    aspects of our product candidates and technologies or obtain and
    use information we consider proprietary. Policing the
    unauthorized use of our proprietary rights is difficult. We
    cannot guarantee that no harm or threat will be made to our or
    our collaborators' intellectual property. In addition,
    changes in, or different interpretations of, patent laws in the
    United States and other countries may also adversely affect the
    scope of our patent protection and our competitive situation.
17
Due to the significant time lag between the filing of patent
    applications and the publication of such patents, we cannot be
    certain that our licensors were the first to file the patent
    applications we license or, even if they were the first to file,
    also were the first to invent, particularly with regards to
    patent rights in the United States. In addition, a number of
    pharmaceutical and biotechnology companies and research and
    academic institutions have developed technologies, filed patent
    applications or received patents on various technologies that
    may be related to our product candidates. Some of these
    technologies, applications or patents may conflict with our or
    our licensors' technologies or patent applications. A
    conflict could limit the scope of the patents, if any, that we
    or our licensors may be able to obtain or result in denial of
    our or our licensors' patent applications. If patents that
    cover our activities are issued to other companies, we may not
    be able to develop or obtain alternative technology.
Additionally, there is certain subject matter that is patentable
    in the United States but not generally patentable outside of the
    United States. Differences in what constitutes patentable
    subject matter in various countries may limit the protection we
    can obtain outside of the United States. For example, methods of
    treating humans are not patentable in many countries outside of
    the United States. These and other issues may prevent us from
    obtaining patent protection outside of the United States, which
    would have a material adverse effect on our business, financial
    condition and results of operations.
Changes
    to U.S. patent laws could materially reduce any value our patent
    portfolio may have.
The value of our patents depends in part on their duration. A
    shorter period of patent protection could lessen the value of
    our rights under any patents that may be obtained and may
    decrease revenues derived from its patents. For example, the
    U.S. patent laws were previously amended to change the term
    of patent protection from 17 years following patent
    issuance to 20 years from the earliest effective filing
    date of the application. Because the time from filing to
    issuance of biotechnology applications may be more than three
    years depending on the subject matter, a
20-year
patent term from the filing date may result in substantially
    shorter patent protection. Future changes to patent laws could
    shorten our period of patent exclusivity and may decrease the
    revenues that we might derive from the patents and the value of
    our patent portfolio.
We may
    not have adequate protection for our unpatented proprietary
    information, which could adversely affect our competitive
    position.
In addition to our patents, we also rely on trade secrets,
    know-how, continuing technological innovations and licensing
    opportunities to develop and maintain our competitive position.
    However, others may independently develop substantially
    equivalent proprietary information and techniques or otherwise
    gain access to our trade secrets or disclose our technology. To
    protect our trade secrets, we may enter into confidentiality
    agreements with employees, consultants and potential
    collaborators. However, we may not have such agreements in place
    with all such parties and, where we do, these agreements may not
    provide meaningful protection of our trade secrets or adequate
    remedies in the event of unauthorized use or disclosure of such
    information. Also, our trade secrets or know-how may become
    known through other means or be independently discovered by our
    competitors. Any of these events could prevent us from
    developing or commercializing our product candidates.
We may
    be subject to claims that we or our employees have wrongfully
    used or disclosed alleged trade secrets of former
    employers.
As is commonplace in the biotechnology industry, we employ now,
    and may hire in the future, individuals who were previously
    employed at other biotechnology or pharmaceutical companies,
    including competitors or potential competitors. Although there
    are no claims currently pending against us, we may be subject to
    claims that we or certain employees have inadvertently or
    otherwise used or disclosed trade secrets or other proprietary
    information of former employers. Litigation may be necessary to
    defend against these claims. Even if we are successful in
    defending against these claims, litigation could result in
    substantial costs and would be a significant distraction to
    management.
18
Risks
    Related To Our Securities and This Offering
Our
    common stock price is volatile and has had limited trading
    volume, and any investment in our securities could decline
    substantially in value.
For the period from January 1, 2009 through the date of
    this prospectus, our closing stock price has fluctuated between
    prices of $0.42 to $1.75 per share, with an average daily
    trading volume of approximately 80,000 shares. In light of
    our small size and limited resources, as well as the
    uncertainties and risks that can affect our business and
    industry, our stock price is expected to continue to be highly
    volatile and can be subject to substantial drops, with or even
    in the absence of news affecting our business. The following
    factors, in addition to the other risk factors described in this
    prospectus, and the potentially low volume of trades in our
    common stock, may have a significant impact on the market price
    of our common stock, some of which are beyond our control:
•
results of preclinical studies and clinical trials;
•
commercial success of approved products;
•
corporate partnerships;
•
technological innovations by us or competitors;
•
changes in laws and government regulations both in the
    U.S. and overseas;
•
changes in key personnel at our company;
•
developments concerning proprietary rights, including patents
    and litigation matters;
•
public perception relating to the commercial value or safety of
    any of our product candidates;
•
future sales of our common stock;
•
future issuance of our common stock causing dilution;
•
anticipated or unanticipated changes in our financial
    performance;
•
general trends related to the biopharmaceutical and
    biotechnological industries; and
•
general conditions in the stock market.
The stock market in general has recently experienced relatively
    large price and volume fluctuations. In particular, the market
    prices of securities of smaller biotechnology companies have
    experienced dramatic fluctuations that often have been unrelated
    or disproportionate to the operating results of these companies.
    Continued market fluctuations could result in extreme volatility
    in the price of our common stock, which could cause a decline in
    its value. You should also be aware that price volatility may be
    worse if the trading volume of the common stock remains limited
    or declines.
Our
    principal stockholders have significant voting power and may
    take actions that may not be in the best interests of our other
    stockholders.
As of March 31, 2010, our officers, directors and principal
    stockholders together controlled approximately 52% of our
    outstanding common stock. Included in this group is Sigma-Tau,
    which holds approximately 43% of our outstanding common stock as
    of March 31, 2010. A portion of the shares of common stock
    currently held by Sigma-Tau, representing approximately 18% of
    our outstanding common stock, is subject to voting agreements
    under which we control the voting power of these shares. We
    cannot assure you that these voting agreements would prevent
    Sigma-Tau from taking actions not in your best interests and
    effectively exercising control over us. These voting agreements
    are currently scheduled to expire between June 2010 and
    September 2012. After their expiration, we will have no control
    over the voting of these shares controlled by Sigma-Tau,
    including with respect to the election of directors and approval
    of significant corporate transactions. This concentration of
    ownership may have the effect of delaying or preventing a change
    in control and might
19
adversely affect the market price of our common stock, and
    therefore may not be in the best interest of our other
    stockholders.
An
    active trading market for the warrants being sold in this
    offering may not develop.
Prior to this offering, there has been no public market for the
    warrants that are part of the units. We intend to apply for
    listing of the warrants to be issued as a part of the units on
    the NYSE Amex. An active trading market for our warrants may
    never develop, and an active market for our common stock may not
    be sustained. If an active market for our securities does not
    develop, it may be difficult for you to sell the securities you
    purchase in this offering without depressing the market price
    for such securities.
If
    securities or industry analysts do not publish research or
    reports or publish unfavorable research about our business, the
    price of our common stock and other securities and their trading
    volume could decline.
The trading market for our common stock and other securities
    will depend in part on the research and reports that securities
    or industry analysts publish about us or our business. We do not
    currently have and may never obtain research coverage by
    securities and industry analysts. If securities or industry
    analysts do not commence or maintain coverage of us, the trading
    price for our common stock and other securities would be
    negatively affected. In the event we obtain securities or
    industry analyst coverage, if one or more of the analysts who
    covers us downgrades our securities, the price of our securities
    would likely decline. If one or more of these analysts ceases to
    cover us or fails to publish regular reports on us, interest in
    the purchase of our securities could decrease, which could cause
    the price of our common stock and other securities and their
    trading volume to decline.
Our
    rights to repurchase certain shares of stock held by Sigma-Tau
    expire over time, and we may never be able or elect to exercise
    these rights.
Until June 2010, we have the right to repurchase at a price of
    $5.00 per share a number of shares of common stock issued to
    Sigma-Tau equal to the lesser of the shares sold to Sigma-Tau in
    connection with our private placement of securities in June
    2005, or the number of shares necessary to reduce
    Sigma-Tau's ownership of our outstanding capital stock to
    an aggregate of approximately 30% at the time of such
    repurchase. In addition, we have the right to repurchase at any
    time until December 31, 2010, for $2.50 per share, up to
    5,000,000 shares of common stock issued to Sigma-Tau in
    connection with a private placement of securities in February
    2008. After December 31, 2010, our rights to repurchase
    common stock held by Sigma-Tau will expire. These provisions
    could, under certain circumstances, allow us to reduce dilution
    by repurchasing these shares at prices lower than the
    then-prevailing market price of our common stock. However, we
    cannot assure you that our share price will increase
    sufficiently to make such repurchases economically feasible or
    that we would avail ourselves of the opportunity to make such
    repurchases even if our share price had risen to such a level.
A
    significant portion of our total outstanding shares are
    restricted from immediate resale but may be sold into the market
    in the near future. This could cause the market price of our
    common stock to drop significantly, even if our business is
    doing well.
Sales of a substantial number of shares of our common stock in
    the public market could occur at any time. Upon completion of
    this offering, we will have
    outstanding           shares
    of common stock, assuming no exercise of outstanding options or
    warrants. Of these shares,
    the           shares
    underlying the units sold in this offering
    and          
    additional shares will be freely tradable,
    and          
    additional shares of common stock will be available for sale in
    the public market beginning 90 days after the date of this
    prospectus following the expiration of
lock-up
agreements between our officers, directors and certain
    stockholders and the representative of the underwriters. The
    representative of the underwriters may release these officers,
    directors and stockholders from their
lock-up
agreements with the underwriters at any time and without notice,
    which would allow for earlier sales of shares in the public
    market. If our stockholders sell, or the market perceives that
    our stockholders intend to sell, substantial amounts of our
    common stock in the public market following this offering, the
    market price of our common stock could decline significantly.
20
If you
    purchase securities in this offering, you will suffer immediate
    dilution of your investment.
We expect the public offering price of the common stock
    underlying the units to be substantially higher than the net
    tangible book value per share of our common stock. Therefore, if
    you purchase units in this offering, you will pay a price per
    share that substantially exceeds our pro forma net tangible book
    value per share after this offering. Based on a public offering
    price of $      per unit, you will
    experience immediate dilution of $     
    per share underlying each unit, representing the difference
    between our pro forma net tangible book value per share after
    giving effect to this offering and the public offering price.
The
    exercise of options and warrants and other issuances of shares
    of common stock or securities convertible into common stock will
    dilute your interest.
As of March 31, 2010, there were outstanding options to
    purchase an aggregate of 4,914,112 shares of our common
    stock at exercise prices ranging from $0.28 per share to $3.82
    per share, of which options to purchase 3,613,069 shares
    were exercisable as of such date. As of March 31, 2010,
    there were warrants outstanding to purchase
    7,933,851 shares of our common stock, at a weighted average
    exercise price of $2.01 per share. The exercise of options and
    warrants at prices below the market price of our common stock
    could adversely affect the price of shares of our common stock.
    Additional dilution may result from the issuance of shares of
    our capital stock in connection with collaborations or
    manufacturing arrangements or in connection with other financing
    efforts.
Any issuance of our common stock that is not made solely to
    then-existing stockholders proportionate to their interests,
    such as in the case of a stock dividend or stock split, will
    result in dilution to each stockholder by reducing his, her or
    its percentage ownership of the total outstanding shares.
    Moreover, if we issue options or warrants to purchase our common
    stock in the future and those options or warrants are exercised
    or we issue restricted stock, stockholders may experience
    further dilution. Holders of shares of our common stock have no
    preemptive rights that entitle them to purchase their pro rata
    share of any offering of shares of any class or series.
In addition, certain warrants to purchase shares of our common
    stock currently contain an exercise price above the current
    market price for the common stock, or above-market warrants. As
    a result, these warrants may not be exercised prior to their
    expiration and we may not realize any proceeds from their
    exercise.
Our
    certificate of incorporation, our stockholder rights plan and
    Delaware law contain provisions that could discourage or prevent
    a takeover or other change in control, even if such a
    transaction would be beneficial to our stockholders, which could
    affect our stock price adversely and prevent attempts by our
    stockholders to replace or remove our current
    management.
Our certificate of incorporation provides our Board with the
    power to issue shares of preferred stock without stockholder
    approval. In addition, under our stockholder rights plan, our
    Board has the discretion to issue certain rights to purchase our
    capital stock to our stockholders when a person acquires in
    excess of 25% of our outstanding common shares. These provisions
    may make it more difficult for stockholders to take corporate
    actions and may have the effect of delaying or preventing a
    change in control, even if such actions or change in control
    would be in your best interests. In addition, we are subject to
    the anti-takeover provisions of Section 203 of the Delaware
    General Corporation Law. Subject to specified exceptions, this
    section provides that a corporation may not engage in any
    business combination with any interested stockholder, as defined
    in that statute, during the three-year period following the time
    that such stockholder becomes an interested stockholder. This
    provision could also have the effect of delaying or preventing a
    change of control of our company. The foregoing factors could
    reduce the price that investors or an acquirer might be willing
    to pay in the future for shares of our common stock.
We may
    become involved in securities class action litigation that could
    divert management's attention and harm our business and our
    insurance coverage may not be sufficient to cover all costs and
    damages.
The stock market has from time to time experienced significant
    price and volume fluctuations that have affected the market
    prices for the common stock of pharmaceutical and biotechnology
    companies. These broad
21
market fluctuations may cause the market price of our common
    stock to decline. In the past, following periods of volatility
    in the market price of a particular company's securities,
    securities class action litigation has often been brought
    against that company. We may become involved in this type of
    litigation in the future. Litigation often is expensive and
    diverts management's attention and resources, which could
    hurt our business, operating results and financial condition.
We
    have broad discretion in the use of proceeds from this offering
    and may invest or spend the proceeds in ways with which you do
    not agree and in ways that may not yield a return.
We will have broad discretion over the use of proceeds from this
    offering. You may not agree with our decisions, and our use of
    the proceeds may not yield any return on your investment in us.
    Our failure to apply the net proceeds of this offering
    effectively could have a material adverse effect on our
    business, financial condition and results of operations.
As a
    public company, we continue to be subject to the requirements of
    Section 404 of the Sarbanes-Oxley Act. If we are unable to
    comply with Section 404 in a timely manner it may affect
    the reliability of our internal control over financial
    reporting.
Assessing our staffing and training procedures to improve our
    internal control over financial reporting is an ongoing process.
    We are currently required to comply with Section 404 of the
    Sarbanes-Oxley Act of 2002 and to make an assessment of the
    effectiveness of our internal control over financial reporting.
    However, our independent registered public accounting firm has
    not been engaged to express, nor have they expressed, an opinion
    on the effectiveness of our internal control over financial
    reporting.
We plan to continue to assess our internal controls and
    procedures and intend to take further action as necessary or
    appropriate to address any other matters we identify. Under
    current SEC rules, our independent registered public accounting
    firm will also be required to deliver an attestation report on
    the operating effectiveness of our internal control over
    financial reporting beginning with the year ending
    December 31, 2010.
We cannot be certain at this time that we will be able to
    successfully complete the attestation requirements of
    Section 404 or that we or our independent registered public
    accounting firm will not identify material weaknesses in our
    internal control over financial reporting. If we fail to comply
    with the requirements of Section 404 or if we or our
    independent registered public accounting firm identify and
    report a material weakness, it may affect the reliability of our
    internal control over financial reporting, which could adversely
    affect our stock price.
SPECIAL
    NOTE REGARDING FORWARD-LOOKING STATEMENTS
This prospectus contains forward-looking statements within the
    meaning of Section 27A of the Securities Act of 1933, as
    amended, or the Securities Act, and Section 21E of the
    Securities Exchange Act of 1934, as amended, or the Exchange
    Act, that involve substantial risks and uncertainties. The
    forward-looking statements are contained principally in the
    sections entitled "Prospectus Summary," "Risk
    Factors," "Management's Discussion and Analysis
    of Financial Condition and Results of Operations" and
    "Business," but are also contained elsewhere in this
    prospectus. In some cases, you can identify forward-looking
    statements by the words "may," "might,"
    "will," "could," "would,"
    "should," "expect," "intend,"
    "plan," "objective," "anticipate,"
    "believe," "estimate," "predict,"
    "project," "potential," "continue"
    and "ongoing," or the negative of these terms, or
    other comparable terminology intended to identify statements
    about the future. These statements involve known and unknown
    risks, uncertainties and other factors that may cause our actual
    results, levels of activity, performance or achievements to be
    materially different from the information expressed or implied
    by these forward-looking statements. Although we believe that we
    have a reasonable basis for each forward-looking statement
    contained in this prospectus, we caution you that these
    statements are based on a
22
combination of facts and factors currently known by us and our
    expectations of the future, about which we cannot be certain.
    Forward-looking statements include, but are not limited to,
    statements about:
•
our anticipated cash needs and our estimates regarding our
    capital requirements and our needs for additional financing;
•
the progress, outcome, timing or success of preclinical studies
    and clinical trials;
•
the expected timing of clinical trials and availability of data
    from those trials;
•
our ability to obtain and maintain regulatory approval for our
    product candidates from the FDA or foreign regulatory
    authorities;
•
future demand for our product candidates and our ability to
    sustain such demand;
•
the size of the potential market for our product candidates;
•
our plans to seek collaborative relationships and the success of
    those relationships;
•
the success of competing therapies that are or become available;
•
our compliance with federal, state and foreign regulatory
    requirements, and regulatory developments that impact those
    requirements;
•
our estimates and assumptions with respect to disease incidence;
•
our intellectual property and our strategies regarding filing
    additional patent applications to attempt to strengthen our
    intellectual property rights;
•
our ability to retain key management and scientific personnel;
•
estimates of our future financial performance;
•
our ability to implement financial controls and procedures on a
    timely basis; and
•
anticipated trends and challenges in our business.
In addition, you should refer to the "Risk Factors"
    section of this prospectus for a discussion of other important
    factors that may cause our actual results to differ materially
    from those expressed or implied by our forward-looking
    statements. As a result of these factors, we cannot assure you
    that the forward-looking statements in this prospectus will
    prove to be accurate or that we will achieve the plans,
    intentions or expectations expressed or implied in our
    forward-looking statements. Furthermore, if our forward-looking
    statements prove to be inaccurate, the inaccuracy may be
    material. In light of the significant uncertainties in these
    forward-looking statements, you should not regard these
    statements as a representation or warranty by us or any other
    person that we will achieve our objectives and plans in any
    specified time frame, or at all. Any forward-looking statements
    we make in this prospectus speak only as of its date, and we
    undertake no obligation to publicly update any forward-looking
    statements, whether as a result of new information, future
    events or otherwise, except as required by law.
You should read this prospectus and the documents that we
    reference in this prospectus and have filed as exhibits to the
    registration statement, of which this prospectus is a part,
    completely and with the understanding that our actual future
    results may be materially different from what we expect. We
    qualify all of our forward-looking statements by these
    cautionary statements.
23
USE OF
    PROCEEDS
We estimate that the net proceeds from our issuance and sale
    of          
    units in this offering will be approximately
    $      million, or approximately
    $      million if the underwriters
    exercise their over-allotment option in full, based upon the
    public offering price of $      per
    unit, after deducting underwriting discounts and commissions,
    the corporate financing fee and estimated offering expenses
    payable by us.
We currently expect to use the net proceeds from this offering,
    and our existing cash and cash equivalents, to fund research and
    development activities, including our anticipated Phase 2
    clinical trial of RGN-352 in AMI patients, as well as the
    completion of our ongoing Phase 2 clinical trial of RGN-137 in
    patients with EB and our support of compassionate use studies
    using RGN-259 and a potential Phase 1/2 clinical trial of
    RGN-352 in patients with multiple sclerosis. We also expect to
    use a portion of the net proceeds for general corporate
    purposes, including working capital.
The expected use of net proceeds from this offering represents
    our intentions based upon our present plans and business
    conditions. Depending on the size of this offering, we may not
    be able to complete the contemplated Phase 2 clinical trial of
    RGN-352 without additional capital. Further, we expect that the
    net proceeds will not be sufficient to complete clinical trials
    to obtain regulatory approval for the marketing of any of our
    current product candidates. As described elsewhere in this
    prospectus, the completion of these trials may be delayed for a
    number of reasons. As of the date of this prospectus, we cannot
    predict with certainty all of the particular uses for the
    proceeds of this offering or the amounts that we will actually
    spend on the uses set forth above. The amount and timing of
    actual expenditures may vary significantly depending upon a
    number of factors, such as the progress of our development
    efforts, regulatory requirements, commercialization efforts in
    the event that we obtain regulatory approval, the amount of
    cash, if any, we generate from strategic collaborations that we
    may enter into or from other sources, and the amount of cash
    used by operations. Accordingly, we will have significant
    flexibility in applying the net proceeds of this offering.
Pending their use, we intend to invest the net proceeds of this
    offering in a variety of capital-preservation investments,
    including short- and intermediate-term, interest-bearing,
    investment-grade securities.
24
CAPITALIZATION
The following table sets forth our cash and cash equivalents and
    our capitalization as of December 31, 2009:
•
on an actual basis; and
•
on an as adjusted basis to give effect to our sale
    of          
    units in this offering at a public offering price of
    $      per unit, after deducting
    underwriting discounts and commissions, the corporate financing
    fee and estimated offering expenses payable by us.
Actual
As Adjusted
(In thousands)
Cash and cash equivalents
$
4,356
$
Stockholders' equity:
Preferred stock, $0.001 per share, 1,000,000 shares
    authorized, no shares issued or outstanding, actual or as
    adjusted
—
—
Common stock, $0.001 par value, 100,000,000 shares
    authorized, 60,406,828 shares issued and outstanding,
    actual;           shares
    authorized,           shares
    issued and outstanding, as adjusted;
60
Additional
paid-in-capital
88,144
Accumulated deficit
(84,501
)
Total stockholders' equity
3,703
Total capitalization
$
3,703
$
The number of shares of common stock outstanding in the table
    above does not include:
•
4,914,112 shares of our common stock issuable upon the
    exercise of stock options outstanding under our 2000 stock
    option plan as of December 31, 2009, at a weighted average
    exercise price of $1.53 per share;
•
1,550,888 shares of our common stock available for future
    issuance under our 2000 stock option plan;
•
7,933,851 shares of our common stock issuable upon the
    exercise of outstanding warrants as of December 31, 2009,
    at a weighted-average exercise price of $2.01 per share; and
•
shares issuable upon exercise of warrants to be issued in
    connection with this offering.
25
PRICE
    RANGE OF COMMON STOCK AND DIVIDEND POLICY
Our common stock trades on the NYSE Amex, previously known as
    the American Stock Exchange, under the symbol "RGN."
    The prices, as presented below, represent the highest and lowest
    bid or sale prices for our common stock by quarter as quoted on
    the NYSE Amex. On April 15, 2010, the last sale price of
    our common stock as reported on the NYSE Amex was $0.57 per
    share.
2008
High
Low
First Quarter
$
1.10
$
0.80
Second Quarter
$
1.92
$
0.83
Third Quarter
$
1.43
$
1.02
Fourth Quarter
$
1.66
$
0.85
2009
High
Low
First Quarter
$
1.75
$
0.42
Second Quarter
$
0.85
$
0.45
Third Quarter
$
1.12
$
0.52
Fourth Quarter
$
0.83
$
0.55
2010
High
Low
First Quarter
$
0.65
$
0.53
Second Quarter (through April 15, 2010)
$
0.68
$
0.46
As of April 14, 2010, we had 851 holders of record of our
    common stock.
Each unit to be issued in this offering consists of shares of
    our common stock and a tradeable warrant to purchase additional
    shares of our common stock. The units will separate immediately
    and the common stock and the warrants will be issued separately.
    There will be no market for the units. Currently, no public
    market exists for the warrants. We intend to apply for listing
    of the warrants on the NYSE Amex, and we expect that the
    warrants will begin trading on or promptly after the date of
    this prospectus, subject to listing.
We have never declared or paid any dividends on our common stock
    or any other securities. We anticipate that we will retain all
    of our future earnings, if any, for use in the operation of our
    business and do not anticipate paying cash dividends in the
    foreseeable future.
DILUTION
If you invest in this offering, your interest will be diluted to
    the extent of the difference between the public offering price
    per share of our common stock, assuming no value is attributed
    to the warrants included in each unit, and the pro forma net
    tangible book value per share of our common stock immediately
    after this offering. Net tangible book value per share is
    determined by dividing our total tangible assets less total
    liabilities by the number of outstanding shares of our common
    stock. As of December 31, 2009, we had a net tangible book
    value of $3.7 million, or approximately $0.06 per share of
    common stock.
Investors participating in this offering will incur immediate
    and substantial dilution. After giving effect to the issuance
    and sale
    of          
    units in this offering at a public offering price of
    $      per unit, and after deducting
    underwriting discounts and commissions and estimated offering
    expenses payable by us, our pro forma net tangible book value as
    of December 31, 2009 would have been approximately
    $      million, or approximately
    $      per share of common stock. This
    represents an immediate increase in the pro forma net tangible
    book value of $      per share to
    existing stockholders, and an immediate dilution in the pro
    forma
26
net tangible book value of $      per
    share to investors purchasing units in this offering. The
    following table illustrates this per share dilution:
Public offering price per share of common stock underlying each
    unit
$
Actual net tangible book value per share as of December 31,
    2009
$
0.06
Increase in pro forma net tangible book value per share
    attributable to new investors participating in this offering
Pro forma net tangible book value per share after this offering
Dilution per share to investors participating in this offering
$
If the underwriters exercise their option in full to
    purchase          
    additional units in this offering, the pro forma net tangible
    book value per share after the offering would be
    $      per share, the increase in the
    pro forma net tangible book value per share to existing
    stockholders would be $      per share
    and the dilution to new investors purchasing units in this
    offering would be $      per share.
The table above excludes:
•
4,914,112 shares of our common stock issuable upon the
    exercise of stock options outstanding under our 2000 stock
    option plan as of December 31, 2009, at a weighted average
    exercise price of $1.53 per share;
•
1,550,888 shares of our common stock available for future
    issuance under our 2000 stock option plan;
•
7,933,851 shares of our common stock issuable upon the
    exercise of outstanding warrants as of December 31, 2009,
    at a weighted-average exercise price of $2.01 per share; and
•
shares issuable upon exercise of warrants to be issued in
    connection with this offering.
To the extent that options or warrants are exercised, new
    options are issued under our equity benefit plans, or we issue
    additional shares of common stock in the future, there will be
    further dilution to investors participating in this offering. In
    addition, we may choose to raise additional capital because of
    market conditions or strategic considerations, even if we
    believe that we have sufficient funds for our current or future
    operating plans. If we raise additional capital through the sale
    of equity or convertible debt securities, the issuance of these
    securities could result in further dilution to our stockholders.
27
SELECTED
    FINANCIAL DATA
You should read the following selected financial data together
    with "Management's Discussion and Analysis of
    Financial Condition and Results of Operations" and our
    financial statements and accompanying notes included later in
    this prospectus. The selected financial data in this section is
    not intended to replace our financial statements and the
    accompanying notes.
We have derived the selected balance sheet data as of
    December 31, 2009 and 2008 and the selected statement of
    operations data for the years ended December 31, 2009 and
    2008 from our audited financial statements that are included in
    this prospectus. We have derived the selected balance sheet data
    as of December 31, 2007, 2006 and 2005 and the selected
    statement of operations data for the years ended
    December 31, 2007, 2006 and 2005 from our audited financial
    statements that are not included in this prospectus.
Our historical results are not necessarily indicative of the
    results to be expected in any future period.
Year Ended December 31,
2009
2008
2007
2006
2005
Statement of Operations Data:
Sponsored research revenue
$
—
$
168,412
$
240,324
$
272,491
$
—
Operating expenses:
Research and development
3,724,514
7,149,808
8,887,255
6,396,524
3,155,735
General and administrative
2,781,790
3,805,346
3,197,685
2,665,652
2,513,792
Total operating expenses
6,506,304
10,955,154
12,084,940
9,062,176
5,669,527
Loss from operations
(6,506,304
)
(10,786,742
)
(11,844,616
)
(8,789,685
)
(5,669,527
)
Interest income
12,444
149,777
666,458
522,704
214,676
Net loss
$
(6,493,860
)
$
(10,636,965
)
$
(11,178,158
)
$
(8,266,981
)
$
(5,454,851
)
Basic and diluted net loss per share
$
(0.12
)
$
(0.21
)
$
(0.24
)
$
(0.21
)
$
(0.15
)
Shares used to compute basic and diluted net loss per share
55,680,525
50,967,617
46,465,982
40,116,367
36,843,609
As of December 31,
2009
2008
2007
2006
2005
Balance Sheet Data:
Cash and cash equivalents
$
4,355,768
$
5,655,367
$
3,696,878
$
13,052,308
$
4,896,143
Short-term investments
—
—
4,579,592
4,000,000
2,679,693
Working capital
3,671,910
4,565,932
6,102,596
16,187,188
6,939,195
Total assets
4,583,754
5,922,576
8,621,793
17,501,625
7,724,634
Total liabilities
880,404
1,325,912
2,469,069
1,249,290
714,127
Accumulated deficit
(84,501,404
)
(78,007,544
)
(67,405,579
)
(56,227,421
)
(47,960,440
)
Stockholders' equity
3,703,350
4,596,664
6,152,724
16,252,335
7,010,507
28
MANAGEMENT'S
    DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
You should read the following discussion and analysis of our
    financial condition and results of our operations together with
    our financial statements and the related notes to those
    statements included later in this prospectus. In addition to
    historical financial information, this discussion contains
    forward-looking statements reflecting our current plans,
    estimates, beliefs and expectations that involve risks and
    uncertainties. As a result of many important factors,
    particularly those set forth under "Special Note Regarding
    Forward-Looking Statements" and "Risk Factors,"
    our actual results and the timing of events may differ
    materially from those anticipated in these forward-looking
    statements.
Overview
We are a biopharmaceutical company focused on the development of
    a novel therapeutic peptide, Thymosin beta 4, or Tß4, for
    tissue and organ protection, repair, and regeneration. We have
    formulated Tß4 into three distinct product candidates
    currently in clinical development:
•
RGN-352, an injectable product candidate to treat cardiovascular
    diseases, central nervous system diseases, and other medical
    indications that may be treated by systemic administration, for
    which we intend to initiate a Phase 2 clinical trial in the
    second half of 2010;
•
RGN-259, a topical eye drop for ophthalmic indications that was
    evaluated in a small Phase 2 clinical trial and is currently
    being supported in compassionate use studies; and
•
RGN-137, a topically applied gel for chronic dermal wounds and
    reduction of scar tissue that is currently in a Phase 2 clinical
    trial for the treatment of the skin defect epidermolysis bullosa.
We have a fourth product candidate, RGN-457, in preclinical
    development. RGN-457 is an inhaled formulation of Tß4
    targeting cystic fibrosis and other pulmonary diseases.
In addition to our four pharmaceutical product candidates, we
    are also pursuing the commercial development of peptide
    fragments and derivatives of Tß4 for cosmeceutical use. We
    believe the biological activities of these fragments may be
    useful, for example, in developing novel cosmeceutical products
    for the anti-aging market.
During 2009, we completed a Phase 1 clinical trial evaluating
    the safety of RGN-352 in 60 healthy subjects. Based on the
    results of this Phase 1 trial and subject to available funding,
    we intend to initiate a Phase 2 clinical trial in the second
    half of 2010 to evaluate RGN-352's ability to salvage and
    regenerate damaged cardiac tissue and improve cardiac function
    after a heart attack. We intend to use a portion of the proceeds
    of this offering in support of this Phase 2 clinical trial,
    although depending on the size of this offering we may not be
    able to complete the trial without additional capital. We also
    intend to supply RGN-352 and may provide other assistance,
    depending on our available financial resources, in support of a
    Phase 1/2 clinical trial proposed to be conducted at a major
    U.S. medical center under a physician-sponsored IND in
    order to evaluate the potential of this product candidate in
    patients with multiple sclerosis.
We are continuing to support the development of RGN-259 in
    ophthalmic indications under compassionate use INDs. We are also
    planning to support a physician-sponsored clinical trial in
    patients with dry eye secondary to graft versus host disease, or
    GvHD, in order to gain further insight into RGN-259's
    ability to repair and regenerate ophthalmic tissues. Our support
    includes manufacturing and supplying RGN-259 for the trial and
    providing regulatory and clinical guidance. We are also
    collaborating with the U.S. military to evaluate the
    potential of RGN-259 to prevent or reduce eye damage caused by
    chemical warfare agents.
We are currently conducting a Phase 2 clinical trial evaluating
    RGN-137 for the treatment of patients with EB, which we expect
    to complete in late 2010 or early 2011. Once we complete our
    Phase 2 EB trial, we will analyze the data in conjunction with
    our two other completed Phase 2 trials, along with the
    preclinical data indicating Tß4's ability to reduce
    scarring, at which time we will further evaluate our strategy
    for the clinical development of RGN-137.
29
In addition to our four pharmaceutical product candidates, we
    are also pursuing the commercial development of peptide
    fragments and derivatives of Tß4 for potential
    cosmeceutical use. These fragments are amino acid sequences, and
    variations thereof, within the Tß4 molecule that have
    demonstrated activity in several
in vitro
preclinical research studies that we have sponsored. We
    believe the biological activities of these fragments may be
    useful, for example, in developing novel cosmeceutical products
    for the anti-aging market. Our strategy is to enter into a
    collaboration with other companies to develop cosmeceutical
    formulations based on these peptides.
As of the date of this prospectus, we believe we have sufficient
    liquidity and capital resources to fund our operations,
    including our ongoing clinical trials and other research
    initiatives, into the third quarter of 2010, without considering
    any proceeds from this offering. With the proceeds of this
    offering, we believe that we will be able to initiate and
    conduct at least a portion of our contemplated Phase 2 AMI
    trial of RGN-352 as well as to complete our ongoing Phase 2
    trial of RGN-137 in EB patients and to support the compassionate
    use studies of RGN-259 and the proposed Phase 1/2 trial of
    RGN-352 in multiple sclerosis patients. However, we will need
    substantial additional funds beyond the proceeds of this
    offering in order to initiate and complete further clinical
    trials beyond those currently contemplated and to continue to
    fund our operations.
We incurred net losses of $6.5 million and
    $10.6 million for the years ended December 31, 2009
    and 2008, respectively. As of December 31, 2009, we had an
    accumulated deficit of $84.5 million. During 2009, we
    issued shares of common stock and warrants to purchase
    additional shares of our common stock to Sigma-Tau for gross
    proceeds of $1.6 million. In October 2009, we also issued
    shares of common stock and warrants to purchase additional
    shares of our common stock to new institutional investors for
    gross proceeds of approximately $3.7 million. From April to
    September 2009, we also reduced our ongoing monthly cash
    outflows through salary reductions and reductions in director
    fees in exchange for the issuance of stock options to our
    non-employee directors and certain of our executives and
    employees, which reduced our cash outflows by approximately
    $300,000 during this period. We restored salaries and directors
    fees to their prior levels in October 2009 and have continued
    our research efforts through the date of this prospectus. We
    intend to maintain tight cost controls and continue to operate
    under a closely monitored budget approved by the Board of
    Directors until sufficient funding is obtained to enable
    expanded research activities.
Financial
    Operations Overview
Historically, we received only immaterial amounts of revenue
    from non-refundable government grants and may never receive
    future grants. We have never generated product revenues, and we
    do not expect to generate product revenues until the FDA
    approves one of our product candidates, if ever, and we begin
    marketing it. Subject to the availability of financing, we
    expect to invest increasingly significant amounts in the
    furtherance of our current clinical programs and may add
    additional preclinical studies and new clinical trials as we
    explore the potential of our current product candidates in other
    indications and explore new formulations of Tß4-based
    product candidates. As we expand our clinical development
    initiatives, we expect to incur substantial and increasing
    losses. Accordingly, we will need to generate significant
    product revenues in order to ultimately achieve and then
    maintain profitability. Also, we expect that we will need to
    raise substantial additional capital in addition to the proceeds
    of this offering in order to meet product development
    requirements. We cannot assure investors that such capital will
    be available when needed, on acceptable terms, or at all.
Most of our expenditures to date have been for research and
    development, or R&D, activities and general and
    administrative, or G&A, activities. R&D costs include
    all of the wholly-allocable costs associated with our various
    clinical programs passed through to us by our outsourced
    vendors. Those costs include manufacturing Tß4 and peptide
    fragments, formulation of Tß4 into our product candidates,
    stability studies for both Tß4 and the various
    formulations, preclinical toxicology, safety and pharmacokinetic
    studies, clinical trial management, medical oversight,
    laboratory evaluations, statistical data analysis, regulatory
    compliance, quality assurance and other related activities.
    R&D includes cash and non-cash compensation, employee
    benefits, travel and other miscellaneous costs of our internal
    R&D personnel, seven persons in total, who are wholly
    dedicated either on a full or part-time basis to R&D
    efforts. R&D also includes a proration of our common
    infrastructure costs for office space and communications. We
    expense our R&D costs as they are incurred.
30
R&D expenditures are subject to the risks and uncertainties
    associated with clinical trials and the FDA review and approval
    process. As a result, these expenses could exceed our
    expectations, possibly materially. We are uncertain as to what
    we will incur in future research and development costs for our
    clinical studies, as these amounts are subject to the outcome of
    current studies, management's continuing assessment of the
    economics of each individual research and development project
    and the internal competition for project funding.
G&A costs include outside professional fees for legal,
    audit and accounting services, including the costs to maintain
    our intellectual property portfolio. G&A also includes cash
    and non-cash compensation, employee benefits, travel and other
    miscellaneous costs of our internal G&A personnel, three in
    total, who are wholly dedicated to G&A efforts. G&A
    also includes a proration of our common infrastructure costs for
    office space, and communications.
Critical
    Accounting Policies
We prepare our financial statements in conformity with
    accounting principles generally accepted in the United States.
    Such accounting principles require that our management make
    estimates and assumptions that affect the amounts reported in
    our financial statements and accompanying notes. Our actual
    results could differ materially from those estimates. The items
    in our financial statements that have required us to make
    significant estimates and judgments are as follows:
Share-Based
    Payment
We account for share-based compensation based on the estimated
    grant date fair value of the award using the Black-Scholes
    option-pricing model. The estimated grant date fair value is
    recognized over the requisite service period.
Determining the appropriate fair value model and calculating the
    fair value of share-based payment awards require the input of
    highly subjective assumptions, including the expected life of
    the share-based payment awards and stock price volatility. Since
    our historical data is limited, the expected life was determined
    in accordance with SEC Staff Accounting
    Bulletin No. 107 guidance for "plain
    vanilla" options. Since our historical trading volume is
    relatively low, we estimated the expected volatility based on
    monthly closing prices for a period consistent with the expected
    life of the option.
The assumptions used in calculating the fair value of
    share-based payment awards represent management's best
    estimates, but these estimates involve inherent uncertainties
    and the application of management judgment. As a result, if
    factors change and we use different assumptions, our stock-based
    compensation expense could be materially different in the
    future. In addition, we are required to estimate the expected
    forfeiture rate and only recognize expense for those shares
    expected to vest. If our actual forfeiture rate is materially
    different from our estimate, the stock-based compensation
    expense could be significantly different from what we have
    recorded in the current period. See Note 2 to our financial
    statements included in this prospectus for a further discussion
    on stock-based compensation and the relative ranges of our
    historical underlying assumptions.
Costs
    of Preclinical Studies and Clinical Trials
We accrue estimated costs for preclinical studies and clinical
    trials conducted by contract research organizations and
    participating hospitals. These costs are a significant component
    of research and development expenses. We accrue costs for
    preclinical studies and clinical trials performed by contract
    research organizations based on estimates of work performed
    under the contracts. Costs of setting up hospital sites for
    participation in trials are accrued immediately. Hospital costs
    related to patient enrollment are accrued as patients are
    entered in the trial.
31
Recent
    Accounting Pronouncements
In February 2010, the Financial Accounting Standards Board, or
    FASB, issued Accounting Standards Update (ASU 2010 —
    09) to address potential practice issues associated with
    FASB ASC 855 (formerly SFAS 165), "Subsequent
    Events." The ASU was effective upon issuance and eliminated
    the requirement for entities that file or furnish financial
    statements with the SEC to disclose the date through which
    subsequent events have been evaluated in originally issued and
    reissued financial statements. Other entities would continue to
    be required to disclose the date through which subsequent events
    have been evaluated; however, disclosures about the date would
    be required only in financial statements revised because of an
    error correction or retrospective application of U.S. GAAP.
    Our adoption of this standard changed our presentation of
    subsequent events when preparing our financial statements.
In September 2009, the FASB ratified ASU
2009-13
(formerly
EITF 08-1),
"Revenue Recognition" (ASC 605):
    Multiple-Deliverable Revenue Arrangements, the final consensus
    reached by the Emerging Issues Task Force that revised the
    authoritative guidance for revenue arrangements with multiple
    deliverables. The guidance addresses how to determine whether an
    arrangement involving multiple deliverables contains more than
    one unit of accounting and how the arrangement consideration
    should be allocated among the separate units of accounting. The
    guidance will be effective for our fiscal year beginning
    January 1, 2011 with early adoption permitted. The guidance
    may be applied retrospectively or prospectively for new or
    materially modified arrangements. We currently do not have any
    multiple-deliverable revenue arrangements, accordingly, the
    adoption of the guidance will not have an impact on our
    financial statements.
In August 2009, the FASB issued ASU
No. 2009-05,
"Fair Value Measurements and Disclosures
    (ASC 820) — Measuring Liabilities at Fair
    Value" (ASU
2009-05).
ASU
2009-05
provides clarification that in circumstances in which a quoted
    price in an active market for the identical liability is not
    available, a reporting entity is required to measure fair value
    using a valuation technique that uses the quoted price of the
    identical liability when traded as an asset or the quoted prices
    for similar liabilities or similar liabilities when traded as
    assets. The guidance provided is effective for the first
    reporting period (including interim periods) beginning after
    issuance. Our adoption of ASU
2009-05
did
    not impact our financial position or results of operations.
In June 2009, the FASB issued ASC 105 (formerly
    SFAS 168), "The FASB Accounting Standards Codification
    and the Hierarchy of Generally Accepted Accounting
    Principles" (ASC 105). ASC 105 is now the source of
    authoritative U.S. GAAP recognized by the FASB to be
    applied by nongovernment entities. It also modifies the GAAP
    hierarchy to include only two levels of GAAP: authoritative and
    non-authoritative. ASC 105 is effective for financial
    statements issued for interim and annual periods ending after
    September 15, 2009. The adoption of this standard in 2009
    changed how we reference various elements of U.S. GAAP when
    preparing our financial statement disclosures, but did not have
    an impact on our financial position or results of operations.
Other new pronouncements issued but not effective until after
    December 31, 2009 are not expected to have a significant
    effect on our financial position or results of operations.
Results
    of Operations
Comparison
    of years ended December 31, 2009 and 2008
Revenues.
For the year ended
    December 31, 2009, we did not recognize any grant revenue,
    as compared to approximately $168,000 for the year ended
    December 31, 2008. Our grant from the NIH for the RGN-137
    trial for the treatment of EB was exhausted during the year
    ended December 31, 2008, and we do not expect to receive
    any additional grant funding for this trial.
Research and Development Expense.
For
    the year ended December 31, 2009, our R&D expenditures
    decreased by approximately $3.4 million, or 48%, to
    approximately $3.7 million, from approximately
    $7.1 million in 2008. Our outsourced R&D costs, which
    are costs paid directly to contract research organizations and
    outside consultants, decreased by approximately
    $2.9 million, or 58%, to approximately $2.1 million,
    from approximately $5.0 million. This net decrease is
    directly related to the conclusion of several clinical trials in
    late 2008 and early 2009.
32
For RGN-352, we completed the majority of work associated with a
    Phase 1 safety trial in 2008, including the initiation and
    completion of a Phase 1A portion followed by the initiation of
    the Phase 1B portion. During 2009, only a relatively minor
    portion of clinical activity on Phase 1B occurred for the
    remaining subjects in the study, along with that phase's
    data evaluation and wrap up. Consequently, our R&D
    expenditures for RGN-352 decreased by approximately
    $1.2 million, or 65%, to approximately $0.6 million in
    2009, from approximately $1.8 million in 2008.
For RGN-259, during 2008, we were actively enrolling our Phase 2
    trial to treat diabetic patients whose corneal epithelium was
    scraped during vitrectomy surgery. In January 2009, we completed
    enrollment of the first cohort of our Phase 2 diabetic
    vitrectomy study and terminated the trial. Consequently, our
    R&D expenditures for RGN-259 decreased by approximately
    $0.1 million, or 15%, to approximately $0.8 million in
    2009, from approximately $0.9 million in 2008.
Throughout 2008, we were actively enrolling our Phase 2 trials
    of RGN-137 to treat patients with pressure ulcers as well as EB.
    Having completed enrollment of our Phase 2 pressure ulcer trial
    at the end of 2008, we incurred relatively less cost in early
    2009 to evaluate the trial's data and report the
    information, while our Phase 2 EB trial continued enrollment
    throughout both periods. Consequently, our R&D expenditures
    for RGN-137 decreased by approximately $1.3 million, or
    89%, to approximately $0.2 million, from approximately
    $1.5 million in 2008.
Some of our outsourced R&D costs are for various
    miscellaneous development efforts or are for certain services
    that span several formulations or trials. These include certain
    stability, pharmacokinetic, and medical monitoring services.
    Given the overall decrease in clinical activity between years,
    these costs decreased by approximately $0.3 million, or
    35%, to approximately $0.5 million in 2009, from
    approximately $0.8 million in 2008.
Our internal R&D costs decreased by approximately
    $0.5 million, or 25%, to approximately $1.6 million in
    2009, from approximately $2.1 million in 2008. As described
    elsewhere in this prospectus, we implemented a salary reduction
    program for six months of 2009. Additionally, we reduced our
    R&D headcount by one person during the year and some of our
    R&D personnel only worked part-time during a portion of
    2009. Finally, as described in Note 7 to our financial
    statements included in this prospectus, we increased our
    forfeiture assumption for stock options based on historical
    experience, which reduced the employee-related non-cash
    stock-based compensation expense associated with the grant of
    stock options. In combination, these variances yielded a
    decrease in our cost of employment for our R&D personnel of
    approximately $0.4 million, or 23%, to approximately
    $1.4 million in 2009, from approximately $1.8 million
    in 2008. Our other cost-cutting measures, as well as a reduction
    in travel associated with less clinical activity, resulted in a
    decrease in our other internal R&D costs of approximately
    $0.1 million, or 35%, to approximately $0.2 million in
    2009, from approximately $0.3 million in 2008.
General and Administrative Expense.
For
    the year ended December 31, 2009, our G&A expenses
    decreased by approximately $1.0 million, or 27%, to
    approximately $2.8 million, from approximately
    $3.8 million in 2008. The combination of our 2009 salary
    reduction program and reductions in stock-based compensation
    expense resulting from changes in forfeiture assumptions yielded
    a decrease in our G&A personnel expenses of approximately
    $0.5 million, or 32%, to approximately $0.9 million in
    2009, from approximately $1.4 million in 2008. We also
    reduced our outside accounting, legal and business development
    personnel costs by $0.5 million, or 28%, to approximately
    $1.5 million in 2009, from approximately $2.0 million
    in 2008. Our other G&A costs for facilities, investor
    relations, insurance, and travel remained consistent between
    years at approximately $0.4 million.
Interest Income.
For the year ended
    December 31, 2009, our interest income decreased by
    $137,000, or 92%, to approximately $12,000, from approximately
    $150,000 in 2008. The decrease was due to lower average
    interest-bearing cash balances during 2009.
33
Liquidity
    and Capital Resources
Overview
We have not commercialized any of our product candidates to date
    and have incurred significant losses since inception. We have
    primarily financed our operations through the issuance of common
    stock and common stock warrants in private and public
    financings. The report of our independent registered public
    accounting firm regarding our financial statements for the year
    ended December 31, 2009 contains an explanatory paragraph
    regarding our ability to continue as a going concern based upon
    our history of net losses and dependence on future financing in
    order to meet our planned operating activities.
We had cash, cash equivalents and short-term investments
    totaling $4.4 million and $5.7 million at
    December 31, 2009 and 2008, respectively. The
    $1.3 million decrease during 2009 was the result of
    $6.2 million used in operating activities, offset by
    $4.9 million in cash raised through the private placement
    of common stock and warrants. As of the date of this prospectus,
    we have approximately $3.0 million of cash and cash
    equivalents. Based on our current operations, we believe our
    existing cash resources, along with the expected net proceeds of
    this offering, will be adequate to fund our operations into the
    third quarter of 2011.
Accordingly, we will continue to have a need for financing,
    which we may not be able to complete either on favorable terms
    or at all. If we raise additional funds by selling shares of our
    common stock or securities convertible into our common stock,
    such as in this offering, the ownership interest of our existing
    stockholders may be significantly diluted. If additional funds
    are raised through the issuance of preferred stock or debt
    securities, these securities are likely to have rights,
    preferences and privileges senior to our common stock and may
    involve significant fees, interest expense, restrictive
    covenants or the granting of security interests in our assets.
    We are also in the process of exploring other alternatives,
    including corporate collaborations and licensing arrangements,
    and the sale of certain of our intellectual property rights.
    There are substantial challenges and risks that will make it
    difficult to successfully implement any of these opportunities.
Cash
    Flows
Net Cash Used in Operating
    Activities.
Net cash used in operating
    activities was approximately $6.2 million and
    $10.6 million for the years ended December 31, 2009
    and 2008, respectively. While our reported net loss for the year
    ended December 31, 2009 was approximately
    $6.5 million, it included approximately $0.8 million
    in non-cash expenses, primarily non-cash share-based
    compensation, which was offset by approximately
    $0.5 million of cash used to retire current liabilities as
    compared to the liabilities reported as of December 31,
    2008. Our net loss in 2008 of $10.6 million approximated
    the net cash used in operating activities in the same period as
    the non-cash share based compensation expenses of approximately
    $1.1 million were fully offset by a similar reduction in
    liabilities as compared to those reported as of
    December 31, 2007.
Net Cash Provided by Investing
    Activities.
Net cash provided by investing
    activities was approximately $4.6 million for the year
    ended December 31, 2008, and there were no investing
    activities during 2009. In 2008, we sold all of our short-term,
    highly-liquid, investment-grade financial instruments that had
    more than a
90-day
maturity from the date of purchase and invested the proceeds in
    cash equivalents.
Net Cash Provided by Financing
    Activities.
Net cash provided by financing
    activities totaled approximately $4.9 million and
    $7.9 million for the years ended December 31, 2009 and
    2008, respectively. In both periods, these net proceeds result
    from the issuance of common stock and warrants to purchase
    common stock.
Future
    Funding Requirements
The expenditures that will be necessary to execute our business
    plan are subject to numerous uncertainties that may adversely
    affect our liquidity and capital resources. As described
    elsewhere in this prospectus, during 2009 we completed two Phase
    2 clinical trials, closed one additional Phase 2 clinical trial
    and completed a Phase 1 clinical trial. Currently, we are
    actively enrolling patients in only one Phase 2 trial, for
    RGN-137 in EB patients, although subject to available funding we
    intend to commence a Phase 2 clinical trial of RGN-352 for AMI
    patients in the second half of 2010 and support a Phase 1/2
    clinical trial of RGN-352 for MS patients,
34
as well as support of small compassionate use studies of
    RGN-259. We currently do not have sufficient capital resources
    to continue clinical development beyond the third quarter of
    2010, without giving effect to this offering.
In addition, the length of time required for clinical trials
    varies substantially according to the type, complexity, novelty
    and intended use of a product candidate. Some of the factors
    that could impact our liquidity and capital needs include, but
    are not limited to:
•
the progress of our clinical trials;
•
the progress of our research activities;
•
the number and scope of our research programs;
•
the progress of our preclinical development activities;
•
the costs involved in preparing, filing, prosecuting,
    maintaining, enforcing and defending patent and other
    intellectual property claims;
•
the costs related to development and manufacture of preclinical,
    clinical and validation lots for regulatory purposes and
    commercialization of drug supply associated with our product
    candidates;
•
our ability to enter into corporate collaborations and the terms
    and success of these collaborations;
•
the costs and timing of regulatory approvals; and
•
the costs of establishing manufacturing, sales and distribution
    capabilities.
In addition, the duration and the cost of clinical trials may
    vary significantly over the life of a project as a result of
    differences arising during the clinical trial protocol,
    including, among others, the following:
•
the number of patients that ultimately participate in the trial;
•
the duration of patient
follow-up
that seems appropriate in view of the results;
•
the number of clinical sites included in the trials; and
•
the length of time required to enroll suitable patient subjects.
Also, we test our potential product candidates in numerous
    preclinical studies to identify indications for which they may
    be product candidates. We may conduct multiple clinical trials
    to cover a variety of indications for each product candidate. As
    we obtain results from trials, we may elect to discontinue
    clinical trials for certain product candidates or for certain
    indications in order to focus our resources on more promising
    product candidates or indications.
Our proprietary product candidates also have not yet achieved
    FDA regulatory approval, which is required before we can market
    them as therapeutic products. In order to proceed to subsequent
    clinical trial stages and to ultimately achieve regulatory
    approval, the FDA must conclude that our clinical data establish
    safety and efficacy. Historically, the results from preclinical
    studies and early clinical trials have often not been predictive
    of results obtained in later clinical trials. A number of new
    drugs and biologics have shown promising results in clinical
    trials, but subsequently failed to establish sufficient safety
    and efficacy data to obtain necessary regulatory approvals.
In addition to our obligations under clinical trials, we are
    committed under an office space lease through January 2013 that
    requires average base rental payments of approximately $7,300
    per month.
Sources
    of Liquidity
Sigma-Tau has historically provided significant equity capital
    to us. In 2009, Sigma-Tau provided approximately
    $1.6 million in gross proceeds out of the approximately
    $5.3 million in total gross proceeds raised during the
    year, with new investors providing the remaining
    $3.7 million. Sigma-Tau provided all of the
    $8.0 million in gross proceeds raised during 2008.
35
As described below under "Business — Material
    Agreements," we are party to a license agreement with a
    subsidiary of Sigma-Tau that provides the opportunity for us to
    receive milestone payments upon specified events and royalty
    payments upon commercial sales of Tß4 in Europe. However,
    we have not received any milestone payments to date, and there
    can be no assurance that we will be able to attain such
    milestones and generate any such payments under the agreement.
Potential sources of outside capital include entering into
    strategic business relationships, public or private sales of
    shares of our capital stock, or debt, or other similar financial
    instruments. While we sold common stock and warrants to purchase
    common stock to Sigma-Tau and new investors in the fourth
    quarter of 2009, we do not have any committed sources of outside
    capital at this time. Consequently, there can be no assurance
    that we will be able to obtain additional capital in sufficient
    amounts, on acceptable terms, or at all.
If we raise additional capital through such a strategic business
    relationship, we may have to give up valuable rights to
    intellectual property. If we raise funds by selling additional
    shares of our common stock or securities convertible into our
    common stock, such as in this offering, the ownership interest
    of our existing stockholders may be significantly diluted. In
    addition, if additional funds are raised through the issuance of
    preferred stock or debt securities, these securities are likely
    to have rights, preferences and privileges senior to our common
    stock and may involve significant fees, interest expense,
    restrictive covenants and the granting of security interests in
    our assets.
Our failure to successfully address ongoing liquidity
    requirements would have a materially negative impact on our
    business, including the possibility of surrendering our rights
    to some technologies or product opportunities, delaying our
    clinical trials, or ceasing operations.
Off
    Balance Sheet Arrangements
We do not have any off-balance sheet arrangements, as such term
    is defined in Item 303(a)(4) of
Regulation S-K.
Quantitative
    and Qualitative Disclosures about Market Risk
Our cash equivalents, which are generally comprised of
    Federally-insured bank deposits and short-term
    U.S. government debt securities, are subject to default,
    changes in credit rating and changes in market value. These
    investments are also subject to interest rate risk and will
    decrease in value if market interest rates increase. As of
    December 31, 2009, these cash equivalents and short-term
    investments were $4.4 million. Due to the short-term nature
    of these investments, if market interest rates differed by 10%
    from their levels as of December 31, 2009, the change in
    fair value of our financial instruments would not have been
    material.
36
BUSINESS
General
We are a biopharmaceutical company focused on the development of
    a novel therapeutic peptide, Tß4, for tissue and organ
    protection, repair, and regeneration. We have formulated
    Tß4 into three distinct product candidates currently in
    clinical development:
•
RGN-352, an injectable product candidate to treat cardiovascular
    diseases, central nervous system diseases, and other medical
    indications that may be treated by systemic administration, for
    which we intend to initiate a Phase 2 clinical trial in the
    second half of 2010;
•
RGN-259, a topical eye drop for ophthalmic indications that was
    evaluated in a small Phase 2 clinical trial and is
    currently being supported in compassionate use studies; and
•
RGN-137, a topically applied gel for chronic dermal wounds and
    reduction of scar tissue that is currently in a Phase 2 clinical
    trial for the treatment of the skin defect epidermolysis
    bullosa, or EB.
We have a fourth product candidate, RGN-457, in preclinical
    development. RGN-457 is an inhaled formulation of Tß4
    targeting cystic fibrosis and other pulmonary diseases.
In addition to our four pharmaceutical product candidates, we
    are also pursuing the commercial development of peptide
    fragments and derivatives of Tß4 for cosmeceutical use.
    Cosmeceuticals are cosmetic products with biologically active
    ingredients. We believe the biological activities of these
    fragments may be useful, for example, in developing novel
    cosmeceutical products for the anti-aging market.
Overview
    of Tß4
Tß4 is a naturally occurring
43-amino
acid peptide that was originally isolated from bovine thymus
    glands. It plays a vital role in cell structure and motility and
    in the protection, regeneration, remodeling and healing of
    tissues.
Although it is recognized that wound healing is a complex
    process, most companies working to develop new drugs in this
    area have focused primarily on the development of growth factors
    to stimulate healing and have, to date, failed to demonstrate
    dramatic improvements in the healing process. Unlike growth
    factors, numerous preclinical animal studies, published by
    independent researchers, have identified several important
    biological activities involving Tß4 that we believe make it
    potentially useful as wound healing, repair and tissue
    regenerating agent. These activities include:
•
Progenitor (Stem) Cell
    Differentiation.
Research published in the
    journal
Nature
in November 2006 featured the discovery
    that Tß4 is the key signaling molecule that triggers adult
    epicardial progenitor cells, or EPCs, to differentiate into
    coronary blood vessels. EPCs are partially differentiated stem
    cells that can further differentiate into specific cell types
    when needed. Confirmatory research published in 2009 in the
Journal of Molecular and Cellular Cardiology
concluded
    that Tß4 is responsible for the initiation of the embryonic
    coronary developmental program and EPC differentiation in adult
    mice. These publications confirm that Tß4's
    interaction with EPCs is necessary for the maintenance of a
    healthy adult animal heart, as well as normal fetal animal heart
    development.
The 2006
Nature
publication also concluded that
    Tß4's interaction with EPCs resulted in the formation
    of cardiomyocytes that repaired damaged myocardium, or heart
    tissue, in mice after an induced AMI. Research published in the
    journal
Circulation
in April 2008 showed Tß4's
    cardioprotective effects in a pig ischemic-reperfusion model.
    This pig model is accepted as an important model upon which to
    base human clinical research, as pigs are larger mammals, the
    anatomy of the pig heart is similar to the human heart, and
    vascular response processes are completed five to six times
    faster in pigs than in humans, so that long-term results can be
    obtained in a relatively short period of time. This research
    also identified Tß4's interaction with EPCs as the
    underlying basis of cardioprotection through the differentiation
    of EPCs into cardiomyocytes, yielding statistically significant
    cardiac functional recovery results when compared to the
    administration of placebo.
37
Similar research in the area of brain tissue was published in
    the journal
Neuroscience
in September 2009. This
    publication concluded that Tß4 triggered the
    differentiation of oligodendrocyte progenitor cells to form
    myelin-producing oligodendrocytes, which led to the
    remyelination of axons in the brain of mice with experimental
    autoimmune encephalomyelitis, or EAE. This mouse model is an
    accepted small animal model for the study of multiple sclerosis.
•
Actin Regulation.
Tß4 regulates
    actin, which comprises up to 10% of the protein of non-muscle
    cells in the body and plays a central role in cell structure and
    in the movement of cells. Research studies have indicated that
    Tß4 stimulates the migration of human keratinocytes, or
    skin cells, human endothelial cells, and progenitor cells.
    Endothelial cells are the major cell type responsible for the
    formation of new blood vessels, a process known as angiogenesis.
    Certain of these studies conducted at the NIH were the first to
    suggest the role of Tß4 in wound healing. The data from
    these studies encouraged us to license the rights to Tß4
    from the NIH in 2001 and to launch an initial clinical
    development program that targeted the use Tß4 for chronic
    dermal wounds.
•
Reduction of Inflammation.
Uncontrolled
    inflammation is the underlying basis of many pathologies and
    injuries. Research has shown that Tß4 is a potent
    anti-inflammatory agent in skin cells and in corneal epithelial
    cells in the eye. Tß4 has also been shown to decrease the
    levels of inflammatory mediators and to significantly reduce the
    influx of inflammatory cells in the reperfused heart of animals.
    More recent preclinical research suggests that Tß4 blocks
    activation of the NFκB pathway, which is involved in DNA
    activation of inflammatory mediators, thereby modulating
    inflammation in the body. This anti-inflammatory activity may
    explain, in part, the mechanism by which Tß4 appeared to
    improve functional outcome in the mouse multiple sclerosis model
    described above, as well as promoting repair in the heart and
    skin. Identifying a factor such as Tß4 that blocks
    activation of NFκB suggests that Tß4 could have
    additional important therapeutic applications for
    inflammation-related diseases, such as cancer, osteoarthritis,
    rheumatic diseases, autoimmune diseases, inflammatory pulmonary
    disease and pancreatitis.
•
Collagen and Laminin-5
    Stimulation.
Tß4 has a number of
    additional biological activities shown to reduce inflammation,
    stimulate the formation of collagen, and up-regulate the
    expression of laminin-5, a subepithelial basement membrane
    protein. Both collagen and laminin-5 are central to healthy
    tissue and the prevention of disease.
•
Apoptosis.
Tß4 has been shown to
    prevent apoptosis, or programmed cell death, in two animal
    models and in two tissue types. In the rodent model, corneal
    apoptosis, or loss of corneal epithelial cells leading to
    corneal epithelial thinning, was prevented through topical
    administration of Tß4, and in the heart muscle of ischemic
    animal models, such as in mice and pigs, cell death was
    prevented by the systemic administration of Tß4.
In combination, we believe that these various biological
    activities work together to play a vital role in the healing and
    repair of injured or damaged tissue and suggest that Tß4 is
    an essential component of the tissue protection and regeneration
    process that may lead to many potential medical applications.
    All of our product candidates are based on Tß4,
    manufactured as a synthetic copy of the naturally occurring
    peptide and formulated for various routes of administration and
    applications.
Our
    Product Candidates
RGN-352
Our product candidate RGN-352 is an injectable formulation of
    Tß4 for systemic administration. We have initially targeted
    RGN-352 for patients who have suffered an acute myocardial
    infarction, or AMI, commonly known as a heart attack.
    Preclinical research published in the scientific journal
Nature
has indicated that Tß4 can guide specific
    types of stem cells from the outer layer of the heart to
    generate new myocardial blood vessels and tissue at injured
    sites.
Clinical Development.
In 2009, we
    completed a Phase 1 clinical trial evaluating the safety,
    tolerability and the pharmacokinetics of the intravenous
    administration of RGN-352. We also designed this trial to
    explore the use of RGN-352 in other indications in which acute
    administration of Tß4 may be warranted. We conducted the
    Phase
38
1 trial in two consecutive parts, referred to as Phase 1A and
    Phase 1B, both of which were double-blind, placebo-controlled,
    and dose-escalating over four doses. We enrolled a total of 60
    healthy subjects in the trial, consisting of 40 subjects in each
    phase, of which 20 subjects participated in both phases. In
    Phase 1A, we evaluated a single administration of RGN-352, and
    in Phase 1B we evaluated once daily administration for
    14 consecutive days.
In September 2008, we reported the results of Phase 1A. The
    single intravenous injection of RGN-352 was well-tolerated at
    all four dose levels. In December 2009, we reported the results
    of Phase 1B. A daily intravenous injection of RGN-352 for 14
    consecutive days was also observed to be well-tolerated at all
    four dose levels. There were no reported dose-limiting adverse
    events in either Phase 1A or Phase 1B.
Future Plans.
Based on the results of
    the Phase 1 trial, and subject to available funding, we intend
    to initiate a Phase 2 clinical trial in the second half of 2010
    to evaluate RGN-352 in patients who have suffered an AMI. We are
    currently designing this trial to observe RGN-352's
    cardioprotective effects and its ability to salvage and
    regenerate damaged cardiac tissue and improve cardiac function
    after a heart attack. We intend to use a portion of the proceeds
    of this offering to initiate and conduct at least a portion of
    this Phase 2 clinical trial, although depending on the size of
    this offering we may not be able to complete the trial without
    additional capital. We expect that the Phase 2 trial design will
    allow for an interim review of patient data from an initial
    group of evaluated patients, and we currently expect that the
    proceeds of this offering will be sufficient to reach this point
    in the trial. Depending on our capital resources, we may conduct
    the trial while continuing strategic partnership discussions
    with biotechnology and pharmaceutical companies for the further
    clinical development of RGN-352.
Recent preclinical research published in the scientific journal
Neuroscience
also indicates that RGN-352 may prove useful
    for patients with multiple sclerosis, or MS, and stroke. In
    research involving mice, the administration of Tß4 resulted
    in statistically significant improvement in neurological
    functional recovery. Based on this research, we intend to
    support a proposed Phase 1/2 clinical trial to be conducted at a
    major U.S. medical center under a physician-sponsored IND
    in order to evaluate the therapeutic potential of RGN-352 in
    patients with MS. We are planning to supply RGN-352 and provide
    clinical and regulatory guidance for the trial. We believe that
    we can support this trial from our existing capital resources,
    although we intend to use a portion of the proceeds from this
    offering to provide additional support.
RGN-259
Our product candidate RGN-259 is a sterile topical eye drop
    formulation of Tß4 for ophthalmic indications.
Clinical Development.
Emerging human
    clinical data from two compassionate use studies have
    demonstrated the ability of RGN-259 to repair and regenerate
    corneal tissue. A corneal specialist has received approval from
    the FDA to treat up to ten patients with neurotrophic keratitis,
    or NK, with RGN-259. NK is a rare degenerative corneal disease
    induced by a nerve impairment. The most common causes of NK
    include the herpes zoster virus. To date, nine patients have
    been treated in an open label protocol for periods of 28 or
    49 days. The NK patients being evaluated have non-healing
    defects that have lasted at least six weeks and up to greater
    than ten years.
Patients in the study were divided into two groups. The first
    group consisted of six patients with a single non-healing
    measurable eye ulcer. The second group consisted of three
    patients with diffuse punctate erosions, a corneal defect that
    appears as numerous small pinhole-sized lesions. All six
    patients with single lesions showed clinically significant
    improvement during the treatment with RGN-259 and the
follow-up
period, with four of the six patients healing completely. The
    completely healed ulcers remained healed during the
follow-up
period, and those that had demonstrated significant improvement
    continued to improve after completion of treatment with RGN-259.
    The three patients with diffuse punctate erosions demonstrated
    no significant improvement, although they did report reduced
    ocular irritation.
In all nine patients treated, RGN-259 has been well-tolerated,
    and there have been no drug-related adverse events. A tenth
    patient with a single lesion has recently been enrolled in the
    study, and we expect to report final results of the
    compassionate use study later in 2010. Based on the preliminary
    findings, we believe that RGN-259 may provide a novel approach
    to the treatment of patients with non-healing neurotrophic
    corneal ulcers.
39
We had previously initiated a Phase 2 clinical trial to evaluate
    RGN-259 in diabetic patients undergoing corneal epithelial
    debridement, or removal of the outer transparent tissue layer of
    the front part of the eye, during vitrectomy surgery. In this
    randomized, double-blind, placebo-controlled, dose-response
    trial conducted at U.S. clinical sites, we originally
    intended to evaluate the safety, tolerability, and healing
    efficacy of three different concentrations of RGN-259 compared
    to placebo, applied as eye drops, four times daily for up to
    14 consecutive days.
While we did not view this particular ophthalmic indication as a
    significant commercial opportunity, we believed that it
    represented a
"proof-of-concept"
clinical model to evaluate the safety and efficacy of
RGN-259
for
    the treatment of corneal indications. We intended to obtain
    initial data that could be used to address other ophthalmic
    indications with larger market potential. Patient enrollment in
    the trial was significantly slower than anticipated due to newer
    surgical techniques and equipment that reduced the need for
    corneal epithelial debridement required for the trial. We closed
    the trial in January 2009, after completion of the first cohort
    of 12 patients, in order to focus our research on other
    commercial opportunities. The encouraging compassionate use data
    described above, which we received during the course of the
    trial, also influenced our decision to close the trial earlier
    than originally intended.
In the 12 patients evaluated in the trial, there were no
    reported drug-related adverse events associated with RGN-259. We
    observed increased corneal epithelial thickening and reduced
    cell and flare inflammation in the patients treated with RGN-259
    as compared to patients receiving placebo, which we believe to
    be indicative of corneal re-epithelialization and healing. None
    of the results from the trial are considered to be statistically
    significant. We expect to report final results later in 2010
    following the submission of the clinical study report to the FDA.
Future Plans.
We are continuing to
    support the evaluation of RGN-259 in NK patients under a
    compassionate use IND and expect to report final patient data
    from these trials in the third quarter of 2010. We are also
    planning to support a physician-sponsored clinical trial in
    patients with dry eye secondary to GvHD in order to gain further
    insight into RGN-259's ability to repair and regenerate
    ophthalmic tissues. Our support includes manufacturing and
    supplying RGN-259 for the trial and providing regulatory and
    clinical guidance. We are continuing to collaborate with the
    U.S. military to evaluate the potential of RGN-259 to
    prevent or reduce eye damage caused by chemical warfare agents.
    We are also engaged in discussions with potential partners
    regarding the clinical development of this product candidate.
    Once enough human data is generated, we intend to seek strategic
    partnerships with one or more ophthalmic specialty companies.
RGN-137
Our product candidate RGN-137 is a topical gel formulation of
    Tß4 intended to promote dermal wound healing and tissue
    regeneration. Preclinical research has demonstrated that
    Tß4 can accelerate dermal regeneration after a wound, while
    more recent research indicates that Tß4 can reduce scarring
    after injury in the skin and heart. Based on research conducted
    at the NIH, we initiated a series of Phase 2 clinical trials to
    evaluate RGN-137 for the treatment of three different types of
    skin wounds.
Clinical Development — Epidermolysis
    Bullosa.
In 2005, we began enrolling patients
    in a Phase 2 trial designed to assess the safety and
    effectiveness of RGN-137 for the treatment of patients with EB.
    EB is a genetic defect that results in fragile skin and other
    epidermal tissues that can blister at the slightest trauma or
    friction, creating a wound that at times does not heal or heals
    poorly. In this randomized, double-blind, placebo-controlled,
    dose-response trial, nine U.S. clinical sites are enrolling
    a total of 36 patients to evaluate the safety,
    tolerability, and wound healing effectiveness of three different
    concentrations of RGN-137 compared to placebo. RGN-137 is being
    applied topically to the skin, once daily for up to 56
    consecutive days.
EB has been designated as an "orphan" indication by
    the FDA. We estimate the prevalence of EB in the United States
    to be between 20,000 and 30,000 patients, with a
    subpopulation of approximately 5,000 patients in the group
    eligible for inclusion in our Phase 2 clinical trial. We
    received a grant of $681,000 from the FDA's Office of
    Orphan Products Development to partially fund this trial. While
    enrollment has been difficult due to the small addressable
    patient population, we currently expect to complete this trial
    by late 2010 or early 2011.
40
Clinical Development — Pressure
    Ulcers.
In late 2005, we began enrolling
    patients in a Phase 2 clinical trial designed to assess the
    safety and effectiveness of RGN-137 for the treatment of
    patients with chronic pressure ulcers, commonly known as
    bedsores. In this randomized, double-blind, placebo-controlled,
    dose-response trial, 15 clinical sites in the United States
    enrolled a total of 72 patients to evaluate the safety,
    tolerability, and wound healing effectiveness of three different
    concentrations of RGN-137 compared to placebo. RGN-137 was
    applied topically to the ulcers, once daily for up to 84
    consecutive days. Patients in the trial were between 19 and
    85 years old and had at least one stable Stage III
    or IV pressure ulcer with a surface area between 5 and
    70 cm
2
.

    Stage III and IV pressure ulcers are full thickness
    wounds that penetrate through the skin and muscle, sometimes
    completely to the bone.
In January 2009, we reported final data from this trial. RGN-137
    was well-tolerated at all three dose levels studied, with no
    dose-limiting adverse events, which achieved the primary
    objective of the study. As for efficacy, all Tß4 doses
    performed similarly compared to placebo, with no statistically
    significant efficacy results. Patients treated with the middle
    dose showed a 17% rate of wound healing, which was the highest
    rate among the three active doses evaluated. The improvement in
    ulcer healing in this middle dose group following nine weeks of
    treatment was equal to the improvement in patients treated with
    placebo after 12 weeks of treatment.
Clinical Development — Venous Stasis
    Ulcers.
In 2006, we began enrolling patients
    in a Phase 2 trial designed to assess the safety and
    effectiveness of RGN-137 for the treatment of patients with
    venous stasis ulcers. In this randomized, double-blind
    dose-response trial, eight clinical sites in Italy and Poland
    enrolled a total of 73 patients to evaluate the safety,
    tolerability, and wound healing effectiveness of three different
    concentrations of RGN-137 compared to placebo. RGN-137 was
    applied topically to the ulcers, once daily for up to 84
    consecutive days. Patients in the trial were between 18 to
    79 years old and had at least one venous stasis ulcer with
    a surface area between 3 and 30
    cm
2
. We

    were the sponsor of the trial, and it was conducted and funded
    by Sigma-Tau.
In March 2009, we reported final data from the trial. RGN-137
    was well-tolerated at all three dose levels, with no
    dose-limiting adverse events, which achieved the primary
    objective of the study. Thirty-three percent (33%) of the
    patients who received the middle dose of RGN-137 had their
    ulcers heal completely after the 12 weeks of treatment,
    compared to 24% of patients receiving the placebo, 16% of the
    patients receiving the lowest drug dose and 17% of patients
    receiving the highest drug dose. Of the patients receiving the
    middle dose whose ulcers healed completely, the median time to
    complete healing decreased by approximately 45%, as compared to
    a 37% decrease in the time to healing for patients in the
    placebo-treated group. None of the differences observed between
    RGN-137 and placebo were statistically significant.
Future Plans.
Once we complete our
    Phase 2 EB trial and evaluate the results, we will evaluate its
    potential value for acceleration of dermal wound healing and
    whether to continue clinical development of this product
    candidate. We believe that preclinical research indicating the
    ability of Tß4 to reduce scarring in rats, complimented by
    reduced scarring in the hearts of mice and pigs after an induced
    heart attack, may also be relevant in suggesting that Tß4
    may be effective in reducing dermal scar tissue. Subject to
    available funding, we plan to continue research and development
    of RGN-137 for this potential application.
RGN-457
Our preclinical product candidate RGN-457 is based on Tß4
    formulated as an inhaled therapeutic agent. We have completed a
    substantial amount of preclinical work necessary for an IND
    application, and we are currently seeking a strategic partner to
    assist in the development of RGN-457 for the treatment of cystic
    fibrosis, or CF. CF is a life-threatening, hereditary disease
    that impairs the patient's ability to breathe due to the
    accumulation of mucus secretions in the airways of the lungs.
    The predicted median age of survival for patients with cystic
    fibrosis is 37 years. There are estimated to be
    approximately 30,000 CF patients in the United States and
    approximately 40,000 CF patients in Europe. It is therefore
    considered to be an orphan disease in both territories. While we
    believe RGN-457 may prove beneficial in the treatment of CF, we
    remain focused primarily on development of our other product
    candidates while we continue strategic partnership discussions
    with respect to RGN-457.
41
Peptide
    Fragments for Cosmeceutical Applications
We are also seeking to identify and evaluate Tß4 peptide
    fragments and derivatives that may be useful as novel components
    in cosmeceutical and consumer products. We have identified
    several amino acid sequences, and variations thereof, within the
    Tß4 molecule that have demonstrated
in vitro
activity in preclinical research studies that we have sponsored,
    and we have filed a number of patent applications related to
    this research. We believe the biological activities of these
    fragments may be useful, for example, in developing novel
    cosmeceutical products for the anti-aging market. To date,
    research has suggested that these fragments suppress
    inflammation, accelerate the deposition of certain types of
    collagen, promote the production of elastin, and inhibit
    programmed cell death, among other activities. Our development
    and commercialization strategy is to identify suitable
    commercial partners to license these novel fragments for various
    cosmeceutical applications. We are currently holding discussions
    with several multinational cosmetics and consumer products
    companies for potential collaborations to further develop and
    commercialize these fragments.
Our
    Strategy
We seek to maximize the value of our product candidates by
    advancing their clinical development and then identifying
    suitable partners for further development, regulatory approval,
    and marketing. We intend to engage in strategic partnerships
    with companies with clinical development and commercialization
    strengths in desired pharmaceutical therapeutic fields. We are
    actively seeking partners with suitable infrastructure,
    expertise and a long-term initiative in our medical fields of
    interest.
For example, in 2004, we entered into a strategic partnership
    with Defiante Farmaceutica S.A., a subsidiary of Sigma-Tau, for
    development and marketing of RGN-137 and RGN-352 for specified
    indications in Europe and other contiguous countries. Sigma-Tau
    also funded and co-managed our Phase 2 clinical trial of RGN-137
    in Europe for the treatment of venous stasis ulcers.
Manufacturing
We use a contract manufacturer to produce bulk Tß4 by an
    established and proven manufacturing process known as
    solid-phase peptide synthesis, and we are in the early stages of
    qualifying backup manufacturers. While we do not currently have
    long-term supply agreements in place, we intend to establish a
    long-term supply arrangement with at least one manufacturer once
    practicable. No assurance can be given, however, that such
    agreements will be negotiated on favorable terms, or at all.
    Contractors are selected on the basis of their supply
    capability, ability to produce a drug substance in accordance
    with current Good Manufacturing Practice requirements of the
    FDA, and ability to meet our established specifications.
We also use a number of outside contract manufacturers to
    formulate bulk Tß4 into our product candidates. All of
    these formulations may require modifications along with
    additional studies as we move through our clinical development
    programs.
Competition
We are engaged in a business that is highly competitive, and our
    target medical indications are ones with significant unmet
    needs. Moreover, the cosmetic and cosmeceutical industries are
    rapidly developing new products based on new scientific
    research. Consequently, there are many enterprises, both
    domestic and foreign, pursuing therapies and products that could
    compete with ours. Most of these entities have financial and
    human resources that are substantially greater than ours,
    specifically with regard to the conduct of clinical research and
    development activities, clinical testing and in obtaining the
    regulatory approvals necessary to market pharmaceutical
    products. Brief descriptions of some of these competitive
    products follow:
•
RGN-352.
Currently, there are no
    approved pharmaceutical products for regenerating cardiac tissue
    following a heart attack, nor are there approved pharmaceutical
    products for the remyelination of axons for patients with
    multiple sclerosis. However, many pharmaceutical companies and
    research organizations are developing products and technologies
    that are intended to prevent cardiac damage, improve cardiac
    function, and regenerate cardiac muscle after a heart attack.
    There are also companies
42
developing products that remyelinate neurons and provide
    functional improvement for multiple sclerosis patients. If we
    were to successfully develop RGN-352 for other cardiovascular
    indications, such as acute or chronic heart failure, such a
    product would have to compete with other drugs or therapies
    currently marketed by large pharmaceutical companies for similar
    indications, as would products for the treatment of multiple
    sclerosis.
•
RGN-259.
Most specialty ophthalmic
    companies have a number of products on the market that could
    compete with RGN-259. There are numerous antibiotics to treat
    eye infections that cause corneal wounds and many eye
    lubrication products to help eye healing and function, many of
    which are sold without prescriptions. Companies also market
    steroids to treat certain severe conditions within our area of
    interest. Allergan, Inc. has marketed
    Restasis
tm
,

    a relatively new approved eye drop to treat dry eye. Dry eye is
    a condition related to a number of diseases and one that we
    believe could benefit from the use of RGN-259.
•
RGN-137.
Johnson & Johnson
    has marketed
    Regranex
tm
for patients with diabetic foot ulcers. Companies such as
    Novartis are developing and marketing artificial skins, which
    would compete with RGN-137 in the treatment of dermal wound
    healing. There are other companies developing new pharmaceutical
    products for wound healing. Products and therapies such as
    antibiotics, honey-based ointments and low frequency
    cavitational ultrasound are also used to treat certain types of
    dermal wounds. Moreover, dermal wound healing is a large and
    highly fragmented marketplace that includes numerous therapeutic
    products and medical devices for treating acute and chronic
    dermal wounds.
•
RGN-457.
CF is a genetic defect for
    which there is no cure. There are mucolytic agents and
    antibiotic drugs on the market, such as Genentech's
    pulmozyme and Novartis'
    TOBI
®
,

    an inhaled version of tobramycin, that relieve the symptoms
    posed by CF and could potentially compete with RGN-457.
•
Cosmeceuticals.
The cosmetics industry
    is highly competitive and dependent on effective marketing and
    distribution. There are multiple products currently launched by
    major international cosmetic enterprises that claim the same or
    similar benefits that may be claimed with our product candidates.
Government
    Regulation
In the United States, the Federal Food, Drug, and Cosmetic Act,
    as amended, and the regulations promulgated thereunder, and
    other federal and state statutes and regulations govern, among
    other things, the testing, manufacturing, labeling, storing,
    recordkeeping, distribution, advertising and promotion of our
    product candidates. Regulation by governmental authorities in
    the United States and foreign countries will be a significant
    factor in the manufacturing and marketing of our product
    candidates and in our ongoing research and product development
    activities. Any product candidate we develop will require
    regulatory approval by governmental agencies prior to
    commercialization. In particular, human therapeutic products are
    subject to rigorous preclinical studies, clinical trials and
    other approval procedures by the FDA and similar health
    authorities in foreign countries. The process of obtaining these
    approvals and subsequent compliance with appropriate federal and
    state statutes and regulations requires the expenditure of
    substantial resources.
Preclinical studies must ordinarily be conducted to evaluate an
    investigational new drug's potential safety by toxicology
    studies and potential efficacy by pharmacology studies. The
    results of these studies, among other things, are submitted to
    the FDA as part of an Investigational New Drug Application, or
    IND, which must be reviewed by the FDA before clinical trials
    can begin. Typically, clinical evaluation involves a three-stage
    process. Phase 1 clinical trials are conducted with a small
    number of healthy volunteers to determine the safety profile and
    the pattern of drug absorption, distribution, metabolism and
    excretion, and to assess the drug's effect on the patient.
    Phase 2, or therapeutic exploratory, trials are conducted with
    somewhat larger groups of patients, who are selected by
    relatively narrow criteria yielding a more homogenous population
    that is afflicted with the target disease, in order to determine
    preliminary efficacy, optimal dosages and expanded evidence of
    safety. Phase 2 trials should allow for the determination of the
    dose to be used in Phase 3 clinical trials. Phase 3, or
    therapeutic confirmatory, large scale, multi-center, comparative
    trials are conducted with patients afflicted with a target
    disease in order to provide enough data for the statistical
    proof of safety and efficacy required by the FDA and other
    regulatory authorities. The primary objective of Phase 3
    clinical trials
43
is to show that the drug confers therapeutic benefit that
    outweighs any safety risks. All clinical trials must be
    registered with a central public database, such as
    www.clinicaltrials.gov, and once completed, results of the
    clinical trials must be entered in the database.
The results of all of these preclinical studies and clinical
    trials, along with detailed information on manufacturing, are
    submitted to the FDA in the form of a New Drug Application, or
    NDA, for approval to commence commercial sales. The FDA's
    review of an NDA requires the payment of a user fee currently in
    excess of $1 million, which may be waived for the first NDA
    submitted by a qualifying small business. In responding to an
    NDA, the FDA may refuse to file the application if the FDA
    determines that the application does not satisfy its regulatory
    approval criteria, request additional information or grant
    marketing approval. Therefore, even if we complete Phase 3
    clinical trials for our product candidates and submit an NDA to
    the FDA, there can be no assurance that the FDA will grant
    marketing approval, or if granted, that it will be granted on a
    timely basis. If the FDA does approve a product candidate, it
    may require, among other things, post-marketing testing,
    including potentially expensive Phase 4 trials, which monitor
    the safety of the drug. In addition, the FDA may in some
    circumstances impose risk evaluation and mitigation strategies
    that may be difficult and expensive to administer. Product
    approvals may be withdrawn if compliance with regulatory
    requirements is not maintained or if problems occur after the
    product reaches the market.
Among the conditions for NDA approval is the requirement that
    the applicable clinical, pharmacovigilance, quality control and
    manufacturing procedures conform on an ongoing basis with
    current Good Clinical Practices, Good Laboratory Practices,
    current Good Manufacturing Practices, and computer information
    system validation standards. During the review of an NDA, the
    FDA will perform a pre-licensing inspection of select clinical
    sites, manufacturing facilities and the related quality control
    records to determine the applicant's compliance with these
    requirements. To assure compliance, applicants must continue to
    expend time, money and effort in the area of training,
    production and quality control. After approval of any product,
    manufacturers are subject to periodic inspections by the FDA. If
    a company fails to comply with FDA regulatory requirements, FDA
    may pursue a wide range of remedial actions, including seizure
    of products, corrective actions, warning letters and fines.
In June 2004, we received orphan drug designation from the FDA
    for Tß4 for the treatment of EB. The FDA may designate a
    product or products as having orphan drug status to treat a
    disease or condition that affects less than 200,000 individuals
    in the United States, or, if patients of a disease number more
    than 200,000, the sponsor can establish that it does not
    realistically anticipate its product sales will be sufficient to
    recover its costs. If a product candidate is designated as an
    orphan drug, then the sponsor may receive incentives to
    undertake the development and marketing of the product,
    including grants for clinical trials, as well as a waiver of the
    user fees for submission of an NDA application. For example, as
    described above, we received a grant of approximately $681,000
    in the aggregate for our ongoing Phase 2 clinical trial of
    RGN-137 to treat patients with EB.
Generally, if a product with an orphan drug designation
    subsequently receives the first marketing approval for the
    indication for which it has such designation, the product is
    entitled to marketing exclusivity for a period of seven years in
    the United States. There may be multiple designations of orphan
    drug status for a given drug and for different indications.
    Orphan drug designation does not guarantee that a product
    candidate will be approved by the FDA for marketing for the
    designation, and even if a sponsor of a product candidate for an
    indication for use with an orphan drug designation is the first
    to obtain FDA approval of an NDA for that designation and
    obtains marketing exclusivity, another sponsor's
    application for the same drug product may be approved by the FDA
    during the period of exclusivity if the FDA concludes that the
    competing product is clinically superior. In this instance, the
    orphan designation and marketing exclusivity originally granted
    would be lost in favor of the clinically superior product.
Intellectual
    Property
We have applied for or hold over 60 worldwide patents on peptide
    compositions, uses and formulations related to dermal and
    ophthalmic indications and other organ and tissue repair
    activities, as well as for cosmetic and consumer product
    applications. In 2001, we entered into a license agreement with
    the NIH under
44
which we received an exclusive worldwide license from the NIH
    for all claims within the scope of the NIH's patent
    application, and any issued patents, covering the use of
    Tß4 as a tissue repair and regeneration factor. During
    2007, a patent was issued in Europe and the U.S. related to
    the original NIH patent application, which patent expires in
    July 2019. Corresponding patents have been granted in Hong Kong,
    Australia and China and certain other territories. The issued
    European patent was opposed by a third party at the European
    Patent Office and in December 2009, we argued the case before
    the Opposition Division of the European Patent Office in Munich,
    Germany and prevailed. In exchange for the exclusive license, we
    agreed to make certain minimum royalty and milestone payments to
    the NIH. Through December 31, 2009, we have complied with
    all minimum royalty requirements, and no milestone payments have
    been required under the agreement.
We hold a U.S. patent relating to the use of Tß4 for
    treatment of alopecia, an autoimmune skin disease that results
    in hair loss, which expires in 2017, with corresponding patents
    in Europe and Singapore that expire in 2018. In 2006, we were
    issued a patent in China for the use of Tß4 to treat EB,
    which expires in 2022.
Under a research agreement with The George Washington
    University, or GWU, we funded Tß4 research at GWU and
    received a sole and exclusive worldwide license to any resulting
    patents. While we no longer fund any research under this
    agreement, we remain obligated to pay GWU a royalty of 4% of the
    net sales, if any, of specified products covered by patents
    issued in connection with the agreement. Pursuant to the
    research agreement, we have exclusive rights to patent
    applications filed in the United States and in Europe disclosing
    the use of Tß4 for the treatment of septic shock and
    associated syndromes, including Adult Respiratory Distress
    Syndrome. Two U.S. patents covered by this agreement have
    been issued, which expire in 2013 and 2014.
We have also filed numerous additional U.S. and
    international patent applications covering various compositions,
    uses, formulations and other components of Tß4, as well as
    for novel peptides resulting from our research efforts. There
    can be no assurance that these, or any other future patent
    applications under which we have rights, will result in the
    issuance of a patent or that any patent issued will not be
    subject to challenge or opposition. In the case of a claim of
    patent infringement by or against us, there can be no assurance
    that we will be able to afford the expense of any litigation
    that may be necessary to enforce our proprietary rights.
Material
    Agreements
National
    Institutes of Health
We have entered into a license agreement with NIH under which we
    are obligated to pay an annual minimum royalty of $25,000.
    Additionally, we are obligated to pay the NIH a percentage of
    sales of qualifying product candidates, if any. There have been
    no such sales to date.
Defiante/Sigma-Tau
We have exclusively licensed certain internal and external wound
    healing European rights to Tß4 to Defiante Farmaceutica,
    S.A., or Defiante, a Portuguese company that is a wholly owned
    subsidiary of Sigma-Tau. These licensed rights to Tß4
    include its use to treat indications that are the subject of all
    of our current dermal clinical trials as well as the treatment
    of heart attacks. The license excludes the use of Tß4 in
    ophthalmic indications and other indications that are
    disease-based and not the result of a wound. Under the
    agreement, Sigma-Tau will develop Tß4 for the treatment of
    internal and external wounds in Europe and certain other
    contiguous and geographically relevant countries. The license
    agreement expires on a
country-by-country
basis upon the later of the expiration of the last to expire of
    any granted patent in the territory having at least one valid
    claim covering the products then on the market, the expiration
    of any other exclusive or proprietary marketing rights, or
    January 2016.
Under the license agreement, Sigma-Tau is obligated to pay us a
    royalty on commercial sales, if any, and we will supply all
    required Tß4 for development. Upon the completion of a
    Phase 2 clinical trial for the covered indications that yields
    positive results in terms of efficacy and safety, Sigma-Tau must
    either pay us a $5 million milestone payment or initiate
    and fund a pivotal Phase 3 clinical trial for the applicable
    product candidate in order to maintain the license. As described
    elsewhere in this prospectus, in 2009, we completed
45
two Phase 2 clinical trials of RGN-137 for the treatment of
    pressure ulcers and venous stasis ulcers, which, due to the lack
    of statistical significance of the reported efficacy results,
    have not triggered the milestone obligation described above.
The license agreement with Defiante also contains future
    clinical and regulatory milestones in the licensed territory. If
    those milestones are attained, certain performance criteria
    regarding commercial registration and minimum annual royalties
    will be payable to us in each licensed country. The agreement
    does not prevent us from sublicensing the technology in
    countries outside the licensed territory, and has no impact on
    any U.S. rights.
Development
    Agreements
We have entered into agreements with outside service providers
    for the manufacture and development of Tß4, the formulation
    of Tß4 into our product candidates, the conduct of
    nonclinical safety, toxicology and efficacy studies in animal
    models, and the management and execution of clinical trials in
    humans. Terms of these agreements vary in that they can last
    from a few months to more than a year in duration. Certain of
    these agreements require initial up front payments ranging from
    25% to 50% of the total estimated cost. For additional
    information regarding our research and development expenses over
    the past two years, see "Management's Discussion and
    Analysis of Financial Condition and Results of
    Operations — Results of Operations" in this
    prospectus.
Employees
To balance costs and optimize control, we utilize an outsourcing
    business strategy, whereby our management oversees the
    outsourced activities for many of our research and development
    and administrative functions. We currently have nine full-time
    employees and one part-time employee, and we retain several
    independent contractors on an as-needed basis. We believe that
    we have good relations with our employees.
Facilities
Our corporate headquarters are located in Rockville, Maryland
    where we lease approximately 3,500 square feet of office
    space with an average base rent of $7,300 per month and a term
    through January 2013. We believe that our facilities are
    generally suitable to meet our needs for the foreseeable future,
    although we will continue to seek alternate or additional space
    as needed.
Corporate
    Information
We were incorporated in Delaware in 1982 under the name Alpha 1
    Biomedicals, Inc. In 2000, we changed our corporate name to
    RegeneRx Biopharmaceuticals, Inc. Our principal executive office
    is located at 15245 Shady Grove Road, Suite 470, Rockville,
    Maryland 20850. Our telephone number is
(301) 208-9191.
Legal
    Proceedings
We are not currently a party to or engaged in any material legal
    proceedings. However, we may be subject to various claims and
    legal actions arising in the ordinary course of business from
    time to time.
46
MANAGEMENT
Executive
    Officers and Directors
The following table sets forth as of the date of this prospectus
    the name, age and position of each person who serves as an
    executive officer or director of our company. There are no
    family relationships among any of our executive officers or
    directors, with the exception that Mr. Finkelstein is the
    first cousin of Dr. Goldstein's wife.
We seek to assemble a board that, as a whole, possesses the
    appropriate balance of professional and industry knowledge.
    financial expertise and high-level management experience
    necessary to oversee and direct our business. To that end, our
    board intends to maintain membership of directors who complement
    and strengthen the skills of other members and who also exhibit
    integrity, collegiality, sound business judgment and other
    qualities that we view as critical to effective functioning of
    the board. The brief biographies below include information, as
    of the date of this prospectus, regarding the specific and
    particular experience, qualifications, attributes or skills of
    each director or nominee that led the board to believe that the
    director should serve on the board.
Name
Age
Position
J.J. Finkelstein
58
President, Chief Executive Officer and Director
C. Neil Lyons
53
Chief Financial Officer
David R. Crockford
64
Vice President, Clinical and Regulatory Affairs
Allan L. Goldstein, Ph.D.
72
Director, Chairman of the Board and Chief Scientific Advisor
Richard J. Hindin
67
Director
Joseph C. McNay
76
Director
Mauro Bove
55
Director
L. Thompson Bowles, M.D., Ph.D.
78
Director
Mr. Finkelstein
has served as our President and
    Chief Executive Officer and a member of our Board of Directors
    since 2002. Mr. Finkelstein also served as our Chief
    Executive Officer from 1984 to 1989 and as the Vice Chairman of
    our Board of Directors from 1989 to 1991. Mr. Finkelstein
    has worked as an executive officer and consultant in the
    bioscience industry for the past 28 years, including
    serving from 1989 to 1996 as chief executive officer of
    Cryomedical Sciences, Inc., a publicly-traded medical device
    company. Mr. Finkelstein has significant experience in
    developing early-stage companies. He has been responsible for
    the regulatory approval and marketing of several medical devices
    in the U.S. and abroad. Mr. Finkelstein has served on
    the executive committee of the Board of Directors of the
    Technology Council of Maryland since 2006, MdBio, Inc. since
    1998 and currently chairs the MdBio Foundation, all of which are
    non-profit entities that support bioscience development and
    education in the State of Maryland. Mr. Finkelstein
    received a business degree in finance from the University of
    Texas. The Board believes that Mr. Finkelstein's
    history and long tenure as our Chief Executive Officer positions
    him to contribute to the Board his extensive knowledge of our
    company and to provide Board continuity. In addition, the Board
    believes that his experience at prior companies has provided him
    with operational and industry expertise, as well as leadership
    skills that are important to the Board.
Mr. Lyons
has served as our Chief Financial Officer
    and Treasurer since 2005. With more than 25 years of
    experience, Mr. Lyons has developed expertise related to
    operations, finance, SEC compliance, complex transactions,
    strategy, information systems and corporate governance. From
    1979 to 1990, Mr. Lyons practiced with Deloitte, providing
    assurance and advisory services to several public companies in
    the Washington, D.C. metro area. Following that,
    Mr. Lyons served as a senior financial executive with HFS,
    Inc., a major Department of Defense contractor, from 1990 to
    1996, with Bell Atlantic from 1996 to 1998, with SkyBridge LP,
    an international satellite broadband
start-up
affiliated with Alcatel, from 1998 to 2003, and consulted with
    area businesses regarding financial management, including the
    initial implementations of the Sarbanes-Oxley
47
Act from 2003 to 2005. Mr. Lyons is a certified public
    accountant and received a Bachelor of Science degree in
    accounting, magna cum laude, from Florida Southern College.
Mr. Crockford
has served as our Vice President of
    Clinical and Regulatory Affairs since March 2005 and was a
    consultant to the Company from 2000 until his appointment as
    Vice President. He has more than 25 years of experience in
    the biotechnology and pharmaceutical industries. During his
    career as a clinical and regulatory affairs professional,
    Mr. Crockford has established strategic plans, implemented
    and obtained marketing approval for 18 drug products, including
    one of the first human growth hormone preparations sold in the
    U.S., 17 in vitro diagnostic tests, and an intraoperative
    medical device to detect and treat cancer.
    Mr. Crockford's other clinical and regulatory
    achievements include the cost-effective and timely development
    of a number of innovative investigational drugs.
    Mr. Crockford is the author of a number of publications,
    including
Development of Thymosin ß4 for Treatment of
    Patients with Ischemic Heart Disease
, and is an inventor or
    co-inventor on approximately two dozen patents related to drug
    development. Mr. Crockford has a B.A. degree in biology and
    chemistry from Boston University. He also completed biochemistry
    and clinical chemistry course studies in Princeton, New Jersey,
    and seminars in reproductive medicine at medical schools at
    Wayne State University and UCLA.
Dr. Goldstein
has served as the Chairman of our
    Board of Directors and our Chief Scientific Advisor since he
    founded our company in 1982. Dr. Goldstein has been a
    Professor of Biochemistry since 1978 and served as Chairman of
    the Department of Biochemistry and Molecular Biology at the
    George Washington University School of Medicine and Health
    Sciences until 2009. Dr. Goldstein is a recognized expert
    in the field of immunology and protein chemistry, having
    authored over 430 scientific articles in professional journals.
    He is also the inventor on over 25 issued
and/or
pending patents in biochemistry, immunology, cardiology, cancer
    and wound healing. Dr. Goldstein discovered several
    important compounds, including Tα1, which is marketed
    worldwide, and Tß4, which is the basis for RegeneRx's
    clinical program. Dr. Goldstein has served on the Board of
    Trustees of the Sabin Vaccine Institute since 2000 and on the
    Board of Directors of the Richard B. and Lynne V. Cheney
    Cardiovascular Institute since 2006. Dr. Goldstein has also
    done pioneering work in the area of medical education,
    developing distance learning programs offered through
    "Frontiers in Medicine," a medical education series
    that Dr. Goldstein developed. The Board believes that
    Dr. Goldstein's scientific expertise, industry
    background and prior experience as our founder all position him
    to make an effective contribution to the medical and scientific
    understanding of the Board, which the Board believes to be
    particularly important as we continue our Tß4 development
    efforts.
Mr. Hindin
has served as a member of our Board of
    Directors since 2002. Mr. Hindin has been an entrepreneur
    during his more than 40 year career and is currently the
    principal stockholder of Chicken Out Rotisserie, Inc., which
    operates 15 restaurants in three states and the District of
    Columbia. Mr. Hindin has served since 1987 as a member and
    since 1989 as the chairman of the board of directors of The
    Institute for Advanced Studies in Aging & Geriatric
    Medicine, or IASIA, a non-profit corporation that disseminates
    medical information to the public as well as providing the
    pharmaceutical industry with an independent source for testing
    vaccines and drugs for the elderly. Mr. Hindin's
    entrepreneurial background includes several companies and
    commenced with Britches of Georgetown, Inc., a clothing retailer
    specializing in the sale of upscale men's and women's
    apparel and accessories which he co-founded. Mr. Hindin has
    also served as Chairman of the Board of Hinsilblon Laboratories
    Ltd., a company based in Fort Myers, Florida which sells
    odor neutralization products and delivery systems, since 1990.
    Finally, Mr. Hindin has served as President of Adworks Inc,
    a Washington D.C.-based advertising and marketing consulting
    agency, since 1987. During 2009, Mr. Hindin filed for
    personal bankruptcy under the U.S. Bankruptcy Code and is
    currently involved in proceedings related to the matter. The
    Board believes that Mr. Hindin's extensive experience
    as an entrepreneur will be increasingly valuable to the Board as
    we seek to expand and finance our operations.
Mr. McNay
has served as a member of our Board of
    Directors since 2002. He is currently Chairman, Chief Investment
    Officer and Managing Principal of Essex Investment Management
    Company, LLC, positions he has held since 1976 when he founded
    Essex. He has direct portfolio management responsibilities for a
    variety of funds and on behalf of private clients. He is also a
    member of the firm's Management Board. Prior to founding
    Essex, Mr. McNay was Executive Vice President and Director
    of Endowment Management & Research Corp. from 1967.
    Prior to that, Mr. McNay was Vice President and Senior
    Portfolio Manager at the
48
Massachusetts Company. Currently he is serving as Trustee of
    National Public Radio, Trustee of the Dana Farber Cancer
    Institute, and is a Trustee and member of the Children's
    Hospital Investment Committee. He received his A.B. degree from
    Yale University and his M.B.A. degree in finance from the
    Wharton School of the University of Pennsylvania. The Board
    believes that Mr. McNay's extensive financial
    experience is valuable to our business and also positions him to
    contribute to the Audit Committee's understanding of
    financial matters.
Mr. Bove
has served as a member of our Board of
    Directors since 2004 and has more than 25 years of business
    and management experience within the pharmaceutical industry.
    Mr. Bove is currently the Head of Corporate &
    Business Development and serves on the board of Sigma-Tau
    Finanziaria S.p.A., the holding company of Sigma-Tau Group, a
    leading international pharmaceutical company, and certain
    Sigma-Tau affiliates, positions he has held since 1993.
    Sigma-Tau Finanziaria S.p.A. and its affiliates are collectively
    our largest stockholder. Mr. Bove has also held a number of
    senior positions in business, licensing and corporate
    development within Sigma-Tau Group, which has subsidiaries in
    most European countries and the United States.
    Mr. Bove obtained his law degree at the University of
    Parma, Italy, in 1980. In 1985, he attended the Academy of
    American and International Laws at the International and
    Comparative Law Center, Dallas, Texas. The Board believes
    that Mr. Bove's extensive business and management
    experience within the pharmaceutical industry allows him to
    recognize and advise the Board with respect to recent industry
    developments.
Dr. Bowles
has served as a member of our Board of
    Directors since 2006. He retired from his career as a thoracic
    surgeon in 1988. Dr. Bowles served as Dean of Medicine and
    Professor of Surgery at The George Washington University, or
    GWU, School of Medicine and Health Sciences from 1976 to 1988
    and as Vice President for Medical Affairs and Executive Dean of
    the GWU Medical Center from 1988 to 1992. Dr. Bowles
    previously served as President of the National Board of Medical
    Examiners, a medical accrediting organization, from 1992 to
    2000. He has also been a member of the National Academy of
    Sciences Institute of Medicine since 1988 and currently serves
    as a member of several other national medical societies
    including: The American College of Surgeons, The American
    Association for Thoracic Surgery, The Society of Thoracic
    Surgeons, The American College of Chest Physicians, The American
    Gerontological Society, The Society of Medical Administrators,
    The College of Physicians of Philadelphia, and The Washington
    Academy of Surgeons. Dr. Bowles has served on the editorial
    board of a number of medical journals, including the Journal of
    Medical Education and continued on as chairman of its newly
    revised updated version, Academic Medicine. Dr. Bowles has
    been President of the District of Columbia's medical
    licensing board called the Healing Arts Commission
(1977-1979),
and was a member of the National Library of Medicine's
    Board of Regents
(1982-1986),
chairman
(1984-1986),
member of the Special Medical Advisory Group of Veterans
    Administration (now Dept. of Veterans Affairs)
1984-1992,
chairman
1992-1994.
Dr. Bowles was also chairman of the National Committee on
    Foreign Medical Education and Accreditation,
1994-1996.
Dr. Bowles received his medical degree from Duke University
    and his Ph.D. in higher education from New York University. The
    Board believes that Dr. Bowles' distinguished medical
    career positions him to bring extensive medical and clinical
    trial experience to the Board. The Board expects that this
    experience will permit Dr. Bowles to provide leadership and
    insight as we translate our laboratory discoveries into human
    clinical trials and advance our product candidates through
    clinical development toward commercialization.
Independence
    of the Board of Directors
As required under NYSE Amex listing standards, a majority of the
    members of a listed company's board of directors must
    qualify as "independent," as affirmatively determined
    by the Board. The Board consults with counsel to ensure that the
    Board's determinations are consistent with relevant
    securities and other laws and regulations regarding the
    definition of "independent," including those set forth
    in pertinent listing standards of the NYSE Amex, as in effect
    from time to time.
Consistent with these considerations, after review of all
    relevant identified transactions or relationships between each
    director, or any of his family members, and us, our senior
    management and our independent auditors, the Board has
    affirmatively determined that the following four directors are
    independent directors within the meaning of the applicable NYSE
    Amex listing standards: Mr. Hindin, Mr. Bove,
    Mr. McNay and Dr. Bowles. In making this
    determination, the Board found that none of the these directors
    had a material or
49
other disqualifying relationship with us. Mr. Finkelstein,
    our President and Chief Executive Officer, and
    Dr. Goldstein, our Chief Scientific Advisor, are not
    independent directors by virtue of their employment with us.
In determining the independence of Mr. Bove, the board of
    directors took into account the significant ownership of our
    common stock by Sigma-Tau and its affiliates. The board of
    directors does not believe that any of the transactions with
    Sigma-Tau and its affiliates described would interfere with
    Mr. Bove's exercise of independent judgment in
    carrying out his responsibilities as a director of our company.
Information
    Regarding Committees of the Board of Directors
The Board has two standing committees: an Audit Committee and a
    Compensation Committee. The Board does not have a separate
    nominating and corporate governance committee. Rather, the
    independent members of the full Board perform the functions of a
    nominating and corporate governance committee.
Below is a description of each committee of the Board. Each of
    the committees has authority to engage legal counsel or other
    experts or consultants, as it deems appropriate to carry out its
    responsibilities. The Board has determined that each member of
    each committee meets the applicable NYSE Amex rules and
    regulations regarding "independence" and that each
    member is free of any relationship that would impair his
    individual exercise of independent judgment with regard to our
    company.
Audit
    Committee
The Audit Committee of the Board consists of Messrs. Hindin
    and McNay and Dr. Bowles, with Mr. Hindin acting as
    the Chairman of the committee. The Audit Committee meets no less
    than quarterly with management and our independent registered
    public accounting firm, both jointly and separately, has sole
    authority to engage and terminate our independent registered
    public accounting firm, and reviews our financial reporting
    process on behalf of the Board. The Audit Committee operates
    under a formal written charter available on our website at
    www.regenerx.com.
Each member of the Audit Committee is an independent director in
    accordance with both Section 121A of the NYSE Amex listing
    standards and
Rule 10A-3
of the Exchange Act. Furthermore, the Board has determined that
    Messrs. Hindin and McNay qualify as "audit committee
    financial experts" as defined under SEC rules.
The Audit Committee pre-approves all audit and non-audit
    engagement fees, and terms and services. On an ongoing basis,
    management communicates specific projects and categories of
    services for which advance approval of the Audit Committee is
    required. The Audit Committee reviews these requests and advises
    management and the independent auditors if the Audit Committee
    pre-approves the engagement of the independent auditors for such
    projects and services. On a periodic basis, the independent
    auditors report to the Audit Committee the actual spending for
    such projects and services compared to the approved amounts.
Compensation
    Committee
The Compensation Committee is composed of four directors:
    Messrs. Hindin, McNay and Bove and Dr. Bowles. All
    members of our Compensation Committee are independent, as
    independence is currently defined in Section 803A of the
    NYSE Amex listing standards. The Compensation Committee has
    adopted a written charter that is available to stockholders on
    our website at www.regenerx.com.
The Compensation Committee of the Board acts on behalf of the
    Board to review, adopt and oversee our compensation strategy,
    policies, plans and programs, including:
•
establishment of corporate and individual performance objectives
    relevant to the compensation of our chief executive officer,
    other executive officers and Board members;
•
evaluation of performance in light of these stated objectives;
50
•
review and approval of the compensation and other terms of
    employment or service, including severance and
change-in-control
arrangements, of our Chief Executive Officer and the other
    executive officers; and
•
administration of our equity compensation plans and other
    similar plan and programs.
Nominating
    and Corporate Governance
The Board does not have a standing nominating and corporate
    governance committee. Instead, pursuant to Section 804 of
    the NYSE Amex listing standards, the independent members of the
    Board, consisting of Messrs. Hindin, McNay and Bove and
    Dr. Bowles, are responsible for performing key nominating
    and corporate governance activities on behalf of the Board,
    including identifying, reviewing and evaluating candidates to
    serve as our directors, reviewing and evaluating incumbent
    directors, selecting candidates for election to the Board,
    making recommendations to the Board regarding the membership of
    the committees of the Board, assessing the performance of
    management and developing and maintaining a set of corporate
    governance principles for us. All members of the Board
    performing the role of a nominating and corporate governance
    committee are "independent" as defined in
    Section 803A of the NYSE Amex listing standards.
Director
    Compensation
The following table set forth certain information for the fiscal
    year ended December 31, 2009 with respect to the
    compensation of our directors. Mr. Finkelstein's
    compensation is disclosed in the Summary Compensation Table
    below, and he does not receive any additional compensation for
    his service as a director. Dr. Goldstein is an employee of
    our company and his compensation as an employee is set forth in
    the table below. He does not receive any additional compensation
    for his service as a director.
Each non-employee director is eligible to receive an annual cash
    retainer of $13,905. The chairman of each of our audit committee
    and compensation committee is eligible to receive a supplemental
    annual cash retainer of $10,300. Mr. Hindin currently
    serves as the chairman of each of these committees.
Directors also receive $1,288 for each board meeting attended in
    person and $412 for each Board meeting attended by telephone.
    Additionally, members of each committee of the board of
    directors are eligible to receive $515 for each committee
    meeting attended, whether in person or by telephone.
Additionally, non-employee directors receive a nonqualified
    stock option under our stock option plan to purchase
    15,000 shares of common stock upon their re-election as a
    director at each annual meeting of stockholders. Newly elected
    or appointed non-employee directors receive a nonqualified stock
    option under our stock option plan to purchase
    35,000 shares of common stock. All options granted to
    directors under this policy vest over four years, with 25% of
    the shares underlying the option vesting on the first through
    fourth anniversaries of the date of grant.
We also reimburse directors for expenses incurred in attending
    meetings of the board and other events attended on our behalf
    and at our request.
Of note, our annual rates of director compensation in effect at
    December 31, 2008 and 2009 remain the same. However, given
    our limited cash resources during most of 2009, the Board
    elected to reduce the cash fees payable to the Board for their
    services by 35% for the period from April 1 to
    September 30, 2009. Consequently, the following charts of
    actual compensation may differ from the disclosed annual rates
    of compensation currently in effect.
51
In return for the 35% director fee reduction, each director
    received options to purchase shares of our common stock at an
    exercise price of $0.57 per share. We granted options to
    purchase an aggregate of 64,157 shares of our common stock
    pursuant to this arrangement. Effective October 1, 2009,
    director fees were restored to the levels in effect at
    December 31, 2008 and, therefore, the options ceased
    vesting as of September 30, 2009 but remain exercisable to
    the extent vested as of September 30, 2009 in accordance
    with the terms of our stock option plan. The number of shares
    vested and outstanding from these option grants are included
    within the amounts set forth in Footnote 1 to the table below.
Director
    Compensation for Fiscal 2009
Fees Earned
or Paid
Option
All Other
in Cash
Awards
Compensation
Total
Name
($)
($)(1)
($)
($)
Allan Goldstein, Ph.D.
—
71,348
162,466
(2)
233,814
Richard Hindin
37,877
16,039
—
53,916
L. Thompson Bowles M.D., Ph.D.
21,105
11,875
—
32,980
Joseph McNay
18,028
10,917
—
28,945
Mauro Bove
16,292
10,459
—
26,751
(1)
These amounts reflect the aggregate full grant date fair values
    (computed in accordance with FASB ASC Topic 718) of options
    granted to directors during 2009, a portion of which vested
    during 2009 as described above. Options held by each Board
    member as of December 31, 2009, are as follows:
Allan Goldstein, Ph.D.
696,942
Richard Hindin
237,749
L. Thompson Bowles M.D., Ph.D.
154,843
Joseph McNay
228,024
Mauro Bove
227,155
(2)
In addition to being Chairman of our Board of Directors,
    Dr. Goldstein also serves as our Chief Scientific Advisor.
    In this capacity, Dr. Goldstein received a base salary of
    $153,093 for 2009, and a discretionary cash bonus of $9,373.
    Under Dr. Goldstein's employment agreement, in the
    event that his employment is terminated by us without
    "cause," as defined in his employment agreement, or if
    he voluntarily terminates his employment within 12 months
    following a "change in control," as defined in his
    employment agreement, then in each case, subject to
    Dr. Goldstein's entering into and not revoking a
    release of claims in a form acceptable to us, Dr. Goldstein
    will be entitled to receive a lump sum severance payment equal
    to his annual base salary then in effect, plus any earned bonus
    as of the date of termination, in each case less applicable
    taxes and withholdings. Dr. Goldstein is not entitled to
    receive any continuing health and welfare benefits as part of
    our severance obligation to him. If Dr. Goldstein's
    employment had been terminated for any of the reasons described
    in this paragraph as of December 31, 2009, he would have
    been entitled to receive a lump sum payment of $187,460, less
    taxes and withholdings. Dr. Goldstein is eligible to
    receive options to purchase common stock under the 2000 Plan.
    The decision to grant any such options and the terms of such
    options are within the discretion of our board of directors or
    the compensation committee. In addition, if
    Dr. Goldstein's employment is terminated without
    "cause," or if there is a "change in
    control" event, in each case as defined in either the 2000
    Plan or in Dr. Goldstein's employment agreement, then
    the unvested portion of Dr. Goldstein's options would
    accelerate in full. All vested options are exercisable for a
    period of time following any termination of
    Dr. Goldstein's employment as may be set forth in the
    2000 Plan or in any option agreement between Dr. Goldstein
    and us.
52
EXECUTIVE
    COMPENSATION
Summary
    Compensation Table
The following table shows, for the fiscal years ended
    December 31, 2009 and 2008, compensation awarded to or paid
    to, or earned by, our chief executive officer and our two other
    most highly compensated executive officers during 2009 who were
    serving as executive officers at December 31, 2009. For
    purposes of this prospectus, we refer to these officers as the
    named executive officers.
Of note, our annual rates of compensation for our named
    executive officers in effect at December 31, 2008 and 2009
    remain the same. However, given our limited cash resources
    during 2009, the named executive officers other than
    Mr. Crockford had their annual base salaries reduced by 35%
    for the period from April 1 to September 30, 2009.
    Consequently, the salary amounts set forth in the following
    table may differ from the disclosed annual base salaries
    currently in effect.
In return for the 35% salary reduction, Mr. Finkelstein and
    Mr. Lyons received options to purchase 172,122 and
    116,592 shares, respectively, of our common stock at an
    exercise price of $0.57 per share. Effective October 1,
    2009, their salaries were restored to the levels in effect at
    December 31, 2008 and, therefore, the options ceased
    vesting as of September 30, 2009 but remain exercisable in
    accordance with the terms of our stock option plan. The number
    of shares vested and outstanding from these option grants are
    set forth in the table within the "Outstanding Equity
    Awards at December 31, 2009" section below.
Non-Equity
Incentive
Option
Plan
All Other
Salary(1)
Bonus(2)
Awards(3)
Compensation(4)
Compensation(5)
Total
Name and Principal Position
Year
($)
($)
($)
($)
($)
($)
J.J. Finkelstein, President and
2009
244,608
18,720
116,198
—
13,005
392,531
Chief Executive Officer
2008
299,520
22,464
86,137
14,976
17,690
440,787
C. Neil Lyons,
2009
167,093
11,140
74,395
—
4,999
257,627
Chief Financial Officer
2008
200,817
12,152
68,848
10,127
8,508
300,452
David R. Crockford,
2009
210,223
5,781
—
—
6,818
222,822
Vice President, Clinical and Regulatory Affairs
2008
209,203
12,613
51,682
10,511
11,681
295,690
(1)
Reflects base salary before pretax contributions and therefore
    includes compensation deferred under our 401(k) plan.
(2)
Reflects the discretionary portion of our bonus plan.
(3)
These amounts reflect the aggregate full grant date fair values
    (computed in accordance with FASB ASC Topic 718) of options
    granted to executives during the respective fiscal years.
(4)
Reflects amounts earned under our bonus plan subject to the
    achievement of corporate performance goals.
(5)
Primarily reflects our match of executive compensation
    deferrals into our 401(k) plan, along with supplemental life and
    disability insurance premiums. None of the individual items
    exceeded $10,000.
Employment
    Agreements; Potential Payments Upon Termination or Change in
    Control
We are party to written employment agreements with our named
    executive officers. These employment agreements contain
    severance and other provisions that may provide for payments to
    the named executive officers following termination of employment
    with us in specified circumstances. The following is a summary
    of the material terms of these employment agreements with our
    named executive officers.
J.J. Finkelstein.
We entered into an
    employment agreement with Mr. Finkelstein in January 2002
    for him to serve as our president and chief executive officer.
    Mr. Finkelstein's employment agreement had an initial
    three-year term, which is automatically renewed for additional
    one-year periods unless either we or Mr. Finkelstein elect
    not to renew it. This agreement was amended and restated during
    2008 and again in 2009. Mr. Finkelstein's annual base
    salary is $299,520. Mr. Finkelstein's salary may not
    be adjusted downward
53
without his written consent, except in a circumstance which is
    part of a general reduction or other concessionary arrangement
    affecting all employees or affecting senior executive officers.
    Mr. Finkelstein is also eligible to receive an annual bonus
    in an amount established by the board of directors and is
    entitled to participate in and receive all standard employee
    benefits and to participate in all of our applicable incentive
    plans, including stock option, stock, bonus, savings and
    retirement plans. We also provide him with $5 million in
    life and disability insurance.
Mr. Finkelstein is eligible to receive options to purchase
    common stock under our Amended and Restated 2000 Stock Option
    and Incentive Plan, which we refer to in this prospectus as the
    2000 Plan. The decision to grant any such options and the terms
    of such options are within the discretion of our board of
    directors or the compensation committee thereof. All vested
    options are exercisable for a period of time following any
    termination of Mr. Finkelstein's employment as may be
    set forth in the 2000 Plan or in any option agreement between
    Mr. Finkelstein and us.
In the event that Mr. Finkelstein's employment is
    terminated by us without "cause" or by
    Mr. Finkelstein for "good reason," each as
    defined in his employment agreement, or if Mr. Finkelstein
    voluntarily terminates his employment within 12 months
    following a "change in control," as defined in his
    employment agreement, then in each case, subject to
    Mr. Finkelstein's entering into and not revoking a
    release of claims in a form acceptable to us,
    Mr. Finkelstein will be entitled to receive (i) a lump
    sum severance payment equal to his annual base salary then in
    effect (or if his base salary is less than the amount in effect
    as of March 31, 2009, the base salary in effect as of
    March 31, 2009), plus (ii) any earned bonus, and
    (iii) if he timely elects and remains eligible for
    continuation of healthcare benefits, that portion of the
    continued healthcare premiums that we were paying prior to the
    date of termination for a period of 12 months, in each case
    less applicable taxes and withholdings. If
    Mr. Finkelstein's employment had been terminated for
    any of the reasons described in this paragraph as of
    December 31, 2009, he would have been entitled to receive a
    lump sum payment of $299,520, less taxes and withholdings, plus
    continuation of healthcare benefits with a value of $8,772.
In addition, if Mr. Finkelstein's employment is
    terminated without "cause," or if there is a
    "change in control" event, in each case as defined in
    either the 2000 Plan or in Mr. Finkelstein's
    employment agreement, then the unvested portion of
    Mr. Finkelstein's options outstanding as of
    December 31, 2009 would accelerate in full.
C. Neil Lyons.
We entered into an
    employment agreement with Mr. Lyons in April 2007 for him
    to serve as our chief financial officer. Mr. Lyons'
    employment agreement had an initial one-year term, which is
    automatically renewed for additional one-year periods unless
    either we or Mr. Lyons elect not to renew it. The agreement
    was amended and restated during 2008 and again in 2009. Under
    the employment agreement, as amended to date,
    Mr. Lyons' base salary is $202,537. Mr. Lyons is
    also eligible to receive an annual bonus in an amount
    established by the board of directors and chief executive
    officer and is entitled to participate in and receive all
    standard employee benefits and to participate in all of our
    applicable incentive plans, including stock option, stock,
    bonus, savings and retirement plans. We also reimburse
    Mr. Lyons for two-thirds of his annual term life insurance
    premium, for term life insurance coverage not to exceed two
    times his annual base salary.
Mr. Lyons is eligible to receive options to purchase common
    stock under the 2000 Plan. The decision to grant any such
    options and the terms of such options are within the discretion
    of our board of directors or the compensation committee thereof.
    All vested options are exercisable for a period of time
    following any termination of Mr. Lyons' employment as
    may be set forth in the 2000 Plan or in any option agreement
    between Mr. Lyons and us.
In the event that Mr. Lyons' employment is terminated
    by us without "cause" as defined in his employment
    agreement, or if Mr. Lyons voluntarily terminates his
    employment within 12 months following a "change in
    control," as defined in his employment agreement, then in
    each case, subject to Mr. Lyons' entering into and not
    revoking a release of claims in a form acceptable to us,
    Mr. Lyons will be entitled to receive (i) severance
    payments equal to his annual base salary then in effect, plus
    (ii) any earned bonus, and (iii) if he timely elects
    and remains eligible for continuation of healthcare benefits,
    that portion of the continued healthcare premiums that we were
    paying prior to the date of termination for a period of
    12 months, in each
54
case less applicable taxes and withholdings. If
    Mr. Lyons's employment had been terminated for any of
    the reasons described in this paragraph as of December 31,
    2009, he would have been entitled to receive severance payments
    of $202,537, less taxes and withholdings, plus continuation of
    healthcare benefits with a value of $17,208.
In addition, if Mr. Lyons' employment is terminated
    without "cause," or if there is a "change in
    control" event, in each case as defined in either the 2000
    Plan or in Mr. Lyons' employment agreement, then the
    unvested portion of Mr. Lyons' options to purchase
    350,000 shares of common stock outstanding as of
    December 31, 2009 would accelerate in full.
David R. Crockford.
We entered into an
    employment agreement with Mr. Crockford in March 2005 for
    him to serve as our vice president of clinical and regulatory
    affairs. Mr. Crockford's employment agreement had an
    initial one-year term, which is automatically renewed for
    additional one-year periods unless either we or
    Mr. Crockford elect not to renew it. The agreement was
    amended and restated during 2008 and again in 2009. Under the
    employment agreement, as amended to date,
    Mr. Crockford's base salary is $210,223.
    Mr. Crockford is also eligible to receive an annual bonus
    in an amount established by the board of directors and chief
    executive officer and is entitled to participate in and receive
    all standard employee benefits and to participate in all of our
    applicable incentive plans, including stock option, stock,
    bonus, savings and retirement plans. We also reimburse
    Mr. Crockford for two-thirds of his annual term life
    insurance premium, for term life insurance coverage not to
    exceed two times his annual base salary.
Mr. Crockford is eligible to receive options to purchase
    common stock under the 2000 Plan. The decision to grant any such
    options and the terms of such options are within the discretion
    of our board of directors or the compensation committee thereof.
    All vested options are exercisable for a period of time
    following any termination of Mr. Crockford's
    employment as may be set forth in the 2000 Plan or in any option
    agreement between Mr. Crockford and us.
In the event that Mr. Crockford's employment is
    terminated by us without "cause" as defined in his
    employment agreement, or if Mr. Crockford voluntarily
    terminates his employment within 12 months following a
    "change in control," as defined in his employment
    agreement, then in each case, subject to
    Mr. Crockford's entering into and not revoking a
    release of claims in a form acceptable to us, Mr. Crockford
    will be entitled to receive (i) severance payments equal to
    his annual base salary then in effect, plus (ii) any earned
    bonus, and (iii) if he timely elects and remains eligible
    for continuation of healthcare benefits, that portion of the
    continued healthcare premiums that we were paying prior to the
    date of termination for a period of 12 months, in each case
    less applicable taxes and withholdings. If
    Mr. Crockford's employment had been terminated for any
    of the reasons described in this paragraph as of
    December 31, 2009, he would have been entitled to receive
    severance payments of $210,223, less taxes and withholdings,
    plus continuation of healthcare benefits with a value of
    $14,664. In addition, upon a "change in control," all
    of Mr. Crockford's unvested options will accelerate in
    full, but there is no such acceleration upon a termination
    without cause.
55
Outstanding
    Equity Awards at December 31, 2009
The following table shows certain information regarding
    outstanding equity awards at December 31, 2009 for the
    named executive officers, all of which were stock options.
Number of
Shares
Number of Shares
Underlying
Underlying
Unexercised
Unexercised
Option
Options (#)
Options (#)
Exercise Price
Option
Name
Exercisable
Unexercisable
($)
Expiration Date
Note
Mr. Finkelstein
500,000
—
0.33
1/1/2012
100,000
—
3.21
4/1/2015
62,500
62,500
2.34
3/15/2014
(1
)
31,250
93,750
1.15
4/15/2015
(1
)
114,748
—
0.57
4/10/2019
—
125,000
0.76
10/11/2016
(1
)
Mr. Lyons
133,332
66,668
3.10
4/7/2015
(2
)
37,500
37,500
2.34
3/15/2014
(1
)
18,750
56,250
1.50
6/15/2015
(1
)
77,728
—
0.57
4/10/2019
—
75,000
0.76
10/11/2016
(1
)
Mr. Crockford
15,000
—
1.07
7/1/2013
125,000
—
0.86
1/1/2014
70,000
30,000
3.21
4/1/2015
(3
)
17,500
7,500
3.82
5/25/2015
(3
)
25,000
25,000
2.15
1/16/2014
(1
)
37,500
37,500
2.34
3/15/2014
(1
)
18,750
56,250
1.15
4/15/2015
(1
)
(1)
This option vests in equal installments on the first four
    anniversaries of the grant date. In each case these options were
    granted seven years prior to the listed expiration dates.
(2)
This option vests in equal installments on the first six
    anniversaries of the grant date which was April 7, 2005.
(3)
This option vests on the first five anniversaries of the grant
    date in the following installments: 10%, 15%, 20%, 25%, 30%. In
    each case these options were granted ten years prior to the
    listed expiration dates.
Post-Employment
    Compensation
We do not maintain any plans providing for payment or other
    benefits at, following, or in connection with retirement other
    than a 401(k) plan made available to all employees. In addition,
    we do not maintain any non-qualified deferred compensation plans.
56
Equity
    Compensation Plan Information
The following table provides information as of December 31,
    2009 about the securities authorized for issuance to our
    employees, directors and other eligible participants under our
    equity compensation plans, consisting solely of the 2000 Plan.
Number of Securities
Remaining Available for
Number of Securities to
Future Issuance Under
be Issued Upon Exercise
Weighted-Average Exercise
Equity Compensation Plans
of Outstanding Options,
Price of Outstanding Options,
(Excluding Securities
Warrants and Rights
Warrants and Rights
Reflected in Column (a))
Plan Category
(a)
(b)
(c)
Equity compensation plans approved by security holders
4,914,112
$
1.53
1,550,888
Equity compensation plans not approved by security holders
—
—
—
Total
4,914,112
$
1.53
1,550,888
The 2000 Plan provides for grants of both incentive stock
    options and non-qualified stock options, as such terms are
    defined below, to participants. Participants in the 2000 Plan
    may include employees, directors, consultants and advisors of us
    and our affiliates. The 2000 Plan is administered by the
    Compensation Committee of the Board. Unless otherwise restricted
    by the Board, the Compensation Committee has the authority and
    discretion to select participants in the 2000 Plan and to grant
    options under the 2000 Plan. The Compensation Committee is
    authorized under the 2000 Plan to fix the terms and conditions
    of all option awards. The exercise price for options is
    determined by the Compensation Committee, provided that the
    exercise price cannot be less than the fair market value of a
    share on the date of grant of the option. In the case of an
    incentive stock option granted to a ten percent owner, the
    exercise price must be at least equal to 110% of the fair market
    value of a share on the date of grant. The Compensation
    Committee may set the term of each option granted under the 2000
    Plan, provided that the term cannot exceed ten years or five
    years in the case of an incentive stock option granted to a ten
    percent owner. The 2000 Plan also gives to the Compensation
    Committee the authority to determine vesting and exercisability
    of options granted under the 2000 Plan and to specify the method
    of payment of the exercise price.
There are currently 6,500,000 shares authorized for
    issuance under the 2000 Plan. Under the 2000 Plan, no single
    participant can receive options for more than
    750,000 shares in any one year.
For purposes of the 2000 Plan, fair market value is defined to
    mean the per share closing price of the shares on the securities
    exchange on which the shares are listed or, if no such price
    information is reported, the fair market value on such date of a
    share as the Compensation Committee shall determine. The 2000
    Plan generally provides that upon an option holder's
    termination of service for any reason other than for cause or
    due to death or disability, the option holder's options to
    the extent vested and exercisable can be exercised up until the
    earlier to occur of (i) three months following the
    termination of service or (ii) the expiration of the term
    of the option. Unless otherwise determined by the Compensation
    Committee, upon termination of service of an option holder due
    to death or disability, the option holder's options vested
    and exercisable can be exercised up until the earlier to occur
    of (i) one year following the termination of service on
    account of death or disability or (ii) the expiration of
    the term of the option. Upon termination of service of an option
    holder for cause (as defined by the 2000 Plan), all of the
    option holder's unexercised options shall immediately be
    forfeited.
The 2000 Plan provides that in certain events (including certain
    mergers or consolidations involving the Company), option holders
    may have the right to elect to receive cash upon exercise of any
    option equal to the fair market value of the underlying stock
    less the exercise price of such option times the number of
    shares with respect to which the options are option exercised.
    The Compensation Committee in its discretion will determine
    whether such amounts are to be paid in cash, property or some
    combination. The 2000 Plan also provides that upon the
    occurrence of certain events that are treated as a "change
    in control," all outstanding
57
options generally will become fully vested and exercisable
    (unless otherwise provided in an option holder's award
    agreement).
Options granted under the 2000 Plan are restricted as to
    transferability. Generally, options only may be transferred by
    will or the laws of descent and distribution, however,
    non-qualified stock options also may be transferred by gift
    under certain circumstances and pursuant to certain domestic
    relations orders. Option holders may be required under the 2000
    Plan to make certain investment representations in connection
    with the exercise of options to enable the Company to comply
    with federal and state securities laws. The Company may refuse
    delivery of shares under the 2000 Plan if the requested
    representations are not made by an option holder or if the
    shares have not been registered by the Company on a stock
    exchange. At the time of delivery of shares under the 2000 Plan,
    option holders may be required to pay any taxes associated with
    the exercise of the option that the Company is required to
    withhold. The 2000 Plan permits the Company to retain or sell
    shares that an option holder otherwise would receive upon
    exercise of the option to cover the tax amounts required to be
    withheld.
No person has a right to be selected as a participant in the
    2000 Plan or to be granted an option under the 2000 Plan.
    Participation in the 2000 Plan or the grant of an option under
    the 2000 Plan does not give any participant or option holder
    rights as an employee of or a consultant or advisor to us or the
    right to be retained in the employ of or as a consultant or
    advisor to us.
The Compensation Committee generally has the authority to amend,
    alter, suspend, discontinue, or terminate the 2000 Plan without
    the consent of stockholders or 2000 Plan participants. However,
    to the extent that an amendment to the 2000 Plan requires
    shareholder approval under any applicable federal or state law
    or regulation or the rules of any stock exchange, the
    Compensation Committee will seek stockholder approval. Unless
    otherwise terminated, the 2000 Plan will remain effective for a
    term of ten years from its effective date, or until
    December 15, 2010. The Compensation Committee may not
    amend, alter, suspend, discontinue or terminate any outstanding
    option without the consent of the participant. We currently
    intend to adopt a new equity incentive plan and submit it to
    stockholders for approval during 2010.
Federal
    Income Tax Information
Incentive Stock Options.
Incentive stock
    options under the 2000 Plan are intended to be eligible for the
    favorable federal income tax treatment accorded "incentive
    stock options" under the Internal Revenue Code of 1986, as
    amended (the "Code").
There generally are no federal income tax consequences to the
    participant or to us by reason of the grant or exercise of an
    incentive stock option. However, the exercise of an incentive
    stock option may increase the participant's alternative
    minimum tax liability, if any.
If a participant holds stock acquired through exercise of an
    incentive stock option for more than two years from the date on
    which the option is granted and more than one year from the date
    on which the shares are transferred to the participant upon
    exercise of the option, any gain or loss on a disposition of
    such stock will be a long-term capital gain or loss.
Generally, if the participant disposes of the stock before the
    expiration of either of these holding periods (a
    "disqualifying disposition"), then at the time of
    disposition the participant will realize taxable ordinary income
    equal to the lesser of (i) the excess of the stock's
    fair market value on the date of exercise over the exercise
    price, or (ii) the participant's actual gain, if any,
    on the purchase and sale. The participant's additional gain
    or any loss upon the disqualifying disposition will be a capital
    gain or loss, which will be long-term or short-term depending on
    whether the stock was held for more than one year.
To the extent the participant recognizes ordinary income by
    reason of a disqualifying disposition, we will generally be
    entitled (subject to the requirement of reasonableness, the
    provisions of Section 162(m) of the Code and the
    satisfaction of a tax reporting obligation) to a corresponding
    business expense deduction in the tax year in which the
    disqualifying disposition occurs.
58
Nonstatutory Stock Options.
Nonstatutory stock
    options granted under the 2000 Plan generally have the following
    federal income tax consequences.
There are no tax consequences to the participant or to us by
    reason of the grant. Upon acquisition of the stock, the
    participant normally will recognize taxable ordinary income
    equal to the excess, if any, of the stock's fair market
    value on the acquisition date over the purchase price. However,
    to the extent the stock is subject to certain types of vesting
    restrictions, the taxable event will be delayed until the
    vesting restrictions lapse unless the participant elects to be
    taxed on receipt of the stock. With respect to employees, we are
    generally required to withhold from regular wages or
    supplemental wage payments an amount based on the ordinary
    income recognized. Subject to the requirement of reasonableness,
    the provisions of Section 162(m) of the Code and the
    satisfaction of a tax reporting obligation, we will generally be
    entitled to a business expense deduction equal to the taxable
    ordinary income realized by the participant.
Upon disposition of the stock, the participant will recognize a
    capital gain or loss equal to the difference between the selling
    price and the sum of the amount paid for such stock plus any
    amount recognized as ordinary income upon acquisition (or
    vesting) of the stock. Such gain or loss will be long-term or
    short-term depending on whether the stock was held for more than
    one year. Slightly different rules may apply to participants who
    acquire stock subject to certain repurchase options or who are
    subject to Section 16(b) of the Exchange Act.
Potential Limitation on Company
    Deductions.
Section 162(m) of the Code
    denies a deduction to any publicly held corporation for
    compensation paid to certain "covered employees" in a
    taxable year to the extent that compensation to such covered
    employee exceeds $1 million. It is possible that
    compensation attributable to awards, when combined with all
    other types of compensation received by a covered employee from
    us, may cause this limitation to be exceeded in any particular
    year.
Certain kinds of compensation, including qualified
    "performance-based compensation," are disregarded for
    purposes of the deduction limitation. In accordance with
    Treasury Regulations issued under Section 162(m),
    compensation attributable to stock options will qualify as
    performance-based compensation if the award is granted by a
    compensation committee comprise solely of "outside
    directors" and either (i) the plan contains a
    per-employee limitation on the number of shares for which such
    awards may be granted during a specified period, the
    per-employee limitation is approved by the stockholders, and the
    exercise price of the award is no less than the fair market
    value of the stock on the date of grant, or (ii) the award
    is granted (or exercisable) only upon the achievement (as
    certified in writing by the compensation committee) of an
    objective performance goal established in writing by the
    compensation committee while the outcome is substantially
    uncertain, and the award is approved by stockholders.
59
CERTAIN
    RELATIONSHIPS AND RELATED PARTY TRANSACTIONS
The following is a summary of transactions, and series of
    related transactions, since January 1, 2007 to which we
    have been or will be a participant, in which the amount involved
    exceeded or will exceed one percent of the average of our total
    assets at year end for the last two completed fiscal years and
    in which any of our executive officers, directors or beneficial
    holders of more than five percent of our capital stock had or
    will have a direct or indirect material interest, or any
    immediate family member of, or person sharing the household
    with, any of these individuals, had or will have a direct or
    indirect material interest, other than executive and director
    compensation arrangements, including the employment, termination
    of employment and change of control arrangements, which are
    described in the section of this prospectus entitled
    "Executive Compensation."
Since January 1, 2007, we have entered into four financing
    transactions with Sigma-Tau and its affiliates as described
    below. As described above, Mauro Bove, one of our directors, is
    an officer of Sigma-Tau. Each of these transactions was approved
    by our Board of Directors and our audit committee, following
    disclosure of Mr. Bove's potential interests in these
    transactions.
On February 29, 2008, we issued 2,500,000 shares of
    common stock to each of Chaumiere-Consultadoria e Servicos SDC
    Unipessoal LDA, or Chaumiere, which is an indirect wholly-owned
    subsidiary of an entity owned by Paolo Cavazza and members of
    his family, who own 38% of Sigma-Tau, and
    Inverlochy-Consultadoria e Servicos (S.U.) LDA, or Inverlochy,
    an entity wholly owned by Claudio Cavazza, who directly and
    indirectly owns 57% of Sigma-Tau, at a purchase price of $1.00
    per share in a private placement. The purchase agreements
    provide that the purchasers may not transfer the shares through
    December 31, 2010, except for transfers to affiliates, that
    we, rather than the purchasers, have all voting rights in
    respect of the shares until December 31, 2010, and that we
    had the right to repurchase the shares at a price of $2.00 per
    share until December 31, 2009, which right has expired, and
    that we have the right to repurchase the shares at a price of
    $2.50 per share until December 31, 2010. We also issued
    warrants to each of Chaumiere and Inverlochy to purchase
    500,000 shares of our common stock at an exercise price of
    $1.60 per share. The warrants have vested in full as of
    December 31, 2009 and are exercisable until
    December 31, 2010.
On December 10, 2008, we issued 1,034,482 shares of
    common stock to each of Chaumiere and Inverlochy at a purchase
    price of $1.45 per share in a private placement. The purchase
    agreements provide that the purchasers may not transfer the
    shares through December 31, 2011, except for transfers to
    affiliates and that we, rather than the purchasers, have all
    voting rights in respect of the shares until December 31,
    2011. We also issued warrants to each of Chaumiere and
    Inverlochy to purchase 372,552 shares of our common stock
    at an exercise price of $1.74 per share. The warrants were
    vested in full upon issuance and are exercisable until
    December 31, 2011.
On April 30, 2009, we issued 1,052,631 shares of
    common stock to Chaumiere at a purchase price of $0.57 per share
    in a private placement. The purchase agreement provides that
    Chaumiere may not transfer the shares through April 30,
    2012 except for transfers to affiliates and that we, rather than
    Chaumiere, have all voting rights in respect to the shares
    through April 30, 2012. We also issued a warrant to
    Chaumiere to purchase 263,158 shares of our common stock at
    an exercise price of $0.91 per share. The warrant was fully
    vested upon issuance and is exercisable until April 30,
    2012.
On October 15, 2009, we issued 1,219,512 shares of
    common stock to Chaumiere at a purchase price of $0.82 per share
    in a private placement. The purchase agreement provides that
    Chaumiere may not transfer the shares through September 30,
    2012 except for transfers to affiliates and that we, rather than
    Chaumiere, have all voting rights in respect to the shares
    through September 30, 2012. We also issued a warrant to
    Chaumiere to purchase 609,756 shares of our common stock at
    an exercise price of $1.12 per share. The warrant was fully
    vested upon issuance and is exercisable until September 30,
    2014.
Indemnification
    of Officers and Directors
Our restated certificate of incorporation limits the personal
    liability of directors for breach of fiduciary duty to the
    maximum extent permitted by the General Corporation Law of the
    State of Delaware, referred to herein as the DGCL. Our restated
    certificate of incorporation provides that no director will have
    personal
60
liability to us or to our stockholders for monetary damages for
    breach of fiduciary duty as a director. However, these
    provisions do not eliminate or limit the liability of any of our
    directors for any of the following:
•
any breach of their duty of loyalty to us or our stockholders;
•
acts or omissions not in good faith or which involve intentional
    misconduct or a knowing violation of law;
•
voting or assenting to unlawful payments of dividends or other
    distributions; or
•
any transaction from which the director derived an improper
    personal benefit.
Any amendment to or repeal of these provisions will not
    eliminate or reduce the effect of these provisions in respect of
    any act or failure to act, or any cause of action, suit or claim
    that would accrue or arise prior to any amendment or repeal or
    adoption of an inconsistent provision. If the DGCL is amended to
    provide for further limitations on the personal liability of
    directors of corporations, then the personal liability of our
    directors will be further limited in accordance with the DGCL.
Section 145 of the DGCL provides that a Delaware
    corporation may indemnify any persons who are, or are threatened
    to be made, parties to any threatened, pending or completed
    action, suit or proceeding, whether civil, criminal,
    administrative or investigative (other than an action by or in
    the right of such corporation), by reason of the fact that such
    person was an officer, director, employee or agent of such
    corporation, or is or was serving at the request of such person
    as an officer, director, employee or agent of another
    corporation or enterprise. Our amended and restated bylaws
    include such a provision. The indemnity may include expenses
    (including attorneys' fees), judgments, fines and amounts
    paid in settlement actually and reasonably incurred by such
    person in connection with such action, suit or proceeding,
    provided that such person acted in good faith and in a manner he
    or she reasonably believed to be in or not opposed to the
    corporation's best interests and, with respect to any
    criminal action or proceeding, had no reasonable cause to
    believe that his or her conduct was unlawful.
Section 145 of the DGCL also provides that a Delaware
    corporation may indemnify any persons who are, or are threatened
    to be made, a party to any threatened, pending or completed
    action or suit by or in the right of the corporation by reason
    of the fact that such person was a director, officer, employee
    or agent of such corporation, or is or was serving at the
    request of such corporation as a director, officer, employee or
    agent of another corporation or enterprise. Our amended and
    restated bylaws contain such a provision. The indemnity may
    include expenses (including attorneys' fees) actually and
    reasonably incurred by such person in connection with the
    defense or settlement of such action or suit provided such
    person acted in good faith and in a manner he or she reasonably
    believed to be in or not opposed to the corporation's best
    interests except that no indemnification is permitted without
    judicial approval if the officer or director is adjudged to be
    liable to the corporation. Where an officer or director is
    successful on the merits or otherwise in the defense of any
    action referred to above, the corporation must indemnify him or
    her against the expenses that such officer or director has
    actually and reasonably incurred.
Expenses incurred by any indemnitee in defending or
    investigating a threatened or pending action, suit or proceeding
    in advance of its final disposition shall be paid by us upon
    delivery to us of an undertaking, by or on behalf of such
    indemnitee, to repay all amounts so advanced if it shall
    ultimately be determined that such indemnitee is not entitled to
    be indemnified by us. No advance will be made by us if a
    determination is reasonably and promptly made by our board of
    directors by a majority vote of a quorum of disinterested
    directors, or if such a quorum is not obtainable or, even if
    obtainable, a quorum of disinterested directors so directs, by
    independent legal counsel in a written opinion, that, based upon
    the facts known to the board or counsel at the time such
    determination is made, such person did not meet the applicable
    standard of conduct in order to be indemnified.
At present, there is no pending litigation or proceeding
    involving any of our directors or officers as to which
    indemnification is required or permitted, and we are not aware
    of any threatened litigation or proceeding that may result in a
    claim for indemnification.
We have an insurance policy covering our officers and directors
    with respect to certain liabilities, including liabilities
    arising under the Securities Act or otherwise.
61
PRINCIPAL
    STOCKHOLDERS
The following table sets forth the beneficial ownership of our
    common stock as of March 15, 2010 and as adjusted to
    reflect the sale of shares in this offering by:
•
each person, or group of affiliated persons, who is known by us
    to beneficially own more than 5% of our common stock;
•
each of our named executive officers;
•
each of our directors; and
•
all of our executive officers and directors as a group.
The percentage ownership information shown in the table is based
    upon 60,406,828 shares of common stock outstanding as of
    March 15, 2010.
We have determined beneficial ownership in accordance with the
    rules of the SEC. These rules generally attribute beneficial
    ownership of securities to persons who possess sole or shared
    voting power or investment power with respect to those
    securities. In addition, the rules include shares of common
    stock issuable pursuant to the exercise of stock options or
    warrants that are either immediately exercisable or exercisable
    on or before May 14, 2010, which is 60 days after
    March 15, 2010. These shares are deemed to be outstanding
    and beneficially owned by the person holding those options or
    warrants for the purpose of computing the percentage ownership
    of that person, but they are not treated as outstanding for the
    purpose of computing the percentage ownership of any other
    person. Unless otherwise indicated, the persons or entities
    identified in this table have sole voting and investment power
    with respect to all shares shown as beneficially owned by them,
    subject to applicable community property laws.
Except as otherwise noted below, the address for persons listed
    in the table is
c/o RegeneRx
Biopharmaceuticals, Inc., 15245 Shady Grove Road,
    Suite 470, Rockville, Maryland 20850.
Number of
Percentage of Shares
Shares
Beneficially Owned
Beneficially
Before
After
Name of Beneficial Owner
Owned
Offering
Offering
5% Stockholders:
Entities affiliated with Sigma-Tau Finanziaria, S.p.A. Via
    Sudafrica, 20, Rome, Italy 00144
30,142,859
(1)
46.9
%
Named Executive Officers and Directors:
J.J. Finkelstein
2,299,636
(2)
3.8
%
Allan L. Goldstein
2,152,538
(3)
3.6
%
Richard J. Hindin
1,175,459
(4)
1.9
%
Joseph C. McNay
1,537,135
(5)
2.5
%
Mauro Bove
197,155
(6)
*
*
L. Thompson Bowles
124,843
(7)
*
*
C. Neil Lyons
329,393
(8)
*
*
David R. Crockford
388,750
(9)
*
*
All current directors and executive officers as a group
    (8 persons)
38,347,768
(10)
63.7
%
*
Represents beneficial ownership of less than 1%.
(1)
Consists of 984,615 shares of common stock held of record
    held by Sigma-Tau Finanziaria, S.p.A. ("Sigma-Tau");
    12,011,185 shares of common stock held of record and
    589,481 shares of common stock issuable upon exercise of
    warrants held by Defiante Farmaceutica S.A.
    ("Defiante"), a subsidiary of Sigma-Tau, that are
    exercisable within 60 days of March 15, 2010;
    5,052,582 shares of common stock held of record and
    1,228,486 shares of common stock issuable upon exercise of
    warrants held by Inverlochy-Consultadoria e Servicos (S.U.) LDA
    ("Inverlochy"), an entity wholly owned by Claudio
    Cavazza,
62
who directly and indirectly owns 57% of Sigma-Tau, that are
    exercisable within 60 days of March 15, 2010; and
    8,175,110 shares of common stock held of record and
    2,101,400 shares of common stock issuable upon exercise of
    warrants held by Chaumiere-Consultadoria e Servicos SDC
    Unipessoal LDA ("Chaumiere"), an indirect wholly-owned
    subsidiary of Aptafin S.p.A., which is owned by Paolo Cavazza
    and members of his family, that are exercisable within
    60 days of March 15, 2010. Paolo Cavazza directly and
    indirectly owns 38% of Sigma-Tau.
(2)
Consists of 1,377,638 shares of common stock held of record
    by Mr. Finkelstein and 51,000 shares of common stock
    held of record by Mr. Finkelstein's minor daughter
    over which Mr. Finkelstein shares voting and dispositive
    power. Also includes 870,998 shares of common stock
    issuable upon exercise of options exercisable within
    60 days of March 15, 2010.
(3)
Consists of 1,586,846 shares of common stock held of record
    by Dr. Goldstein and 565,692 shares of common stock
    issuable upon exercise of options exercisable within
    60 days of March 15, 2010.
(4)
Consists of 967,710 shares of common stock held of record
    by Mr. Hindin and 207,749 shares of common stock
    issuable upon exercise of options exercisable within
    60 days of March 15, 2010.
(5)
Consists of 1,339,111 shares of common stock held of record
    by Mr. McNay and 198,024 shares of common stock
    issuable upon exercise of options exercisable within
    60 days of March 15, 2010.
(6)
Consists of shares of common stock issuable upon exercise of
    options exercisable within 60 days of March 15, 2010.
    Mr. Bove is an officer of Sigma-Tau, but he has no
    beneficial ownership over the reported securities as he has no
    voting or dispositive power with respect to the securities held
    by Sigma-Tau and its affiliates described in Note 2 above.
(7)
Consists of shares of common stock issuable upon exercise of
    options exercisable within 60 days of March 15, 2010.
(8)
Consists of 10,000 shares of common stock held of record by
    Mr. Lyons and 319,393 shares of common stock issuable
    upon exercise of options exercisable within 60 days of
    March 15, 2010.
(9)
Consists of shares of common stock issuable upon exercise of
    options exercisable within 60 days of March 15, 2010.
(10)
Consists of 31,555,797 shares of common stock held of
    record, 3,919,367 shares of common stock issuable upon
    exercise of warrants exercisable within 60 days of
    March 15, 2010 and 2,872,604 shares of common stock
    issuable upon exercise of options exercisable within
    60 days of March 15, 2010.
63
DESCRIPTION
    OF SECURITIES
As of the date of this prospectus, our certificate of
    incorporation authorizes us to issue 100,000,000 shares of
    common stock, par value $0.001 per share, and
    1,000,000 shares of preferred stock, par value $0.001 per
    share. As of March 31, 2010, 60,406,828 shares of
    common stock were outstanding and no shares of preferred stock
    were outstanding. Depending on the number of shares to be issued
    in this offering, we may be required to effect an amendment to
    our restated certificate of incorporation in order to increase
    the authorized number of shares of common stock.
As of March 31, 2010, we also had outstanding:
•
options to purchase 4,914,112 shares of our common stock at
    a weighted average exercise price of $1.53 per share; and
•
warrants to purchase an aggregate of 7,933,851 shares of
    our common stock at a weighted average exercise price of $2.01
    per share.
The following summary description of our capital stock is based
    on the provisions of our certificate of incorporation, including
    the certificate of designation for our Series A
    Participating Cumulative Preferred Stock described below, as
    well as our bylaws, our stockholder rights plan and the
    applicable provisions of the Delaware General Corporation Law.
    This information is qualified entirely by reference to the
    applicable provisions of our restated certificate of
    incorporation, as amended to date, our bylaws, as amended to
    date, our stockholder rights plan and the Delaware General
    Corporation Law. For information on how to obtain copies of our
    certificate of incorporation, bylaws and stockholder rights
    plan, which are exhibits to the registration statement of which
    this prospectus is a part, see "Where You Can Find
    Additional Information."
Units
In this offering, we are
    offering          
    units, consisting
    of           shares
    of common stock and warrants to
    purchase           shares
    of common stock. Each unit consists
    of           shares
    of common stock and a tradeable warrant to
    purchase           shares
    of common stock. The units will separate immediately and the
    common stock and the warrants will be issued separately. There
    will be no market for the units. We are also issuing warrants to
    purchase up to an aggregate
    of           shares
    of our common stock at an exercise price of
    $      per share to the underwriters as
    underwriting compensation. The terms of these underwriters'
    warrants are summarized below under
    "Underwriting — Underwriters'
    Warrants." This prospectus also relates to the offering of
    shares of our common stock upon exercise, if any, of the
    warrants.
Common
    Stock
Voting Rights.
Each holder of our common stock
    is entitled to one vote for each share on all matters submitted
    to a vote of the stockholders, including the election of
    directors. Our certificate of incorporation and bylaws do not
    provide for cumulative voting rights. Because of this, the
    holders of a majority of the shares of common stock entitled to
    vote in any election of directors can elect all of the directors
    standing for election, if they should so choose.
Dividends.
Subject to preferences that may be
    applicable to any then outstanding preferred stock, holders of
    common stock are entitled to receive dividends, if any, as may
    be declared from time to time by our board of directors out of
    legally available funds.
Liquidation.
In the event of our liquidation,
    dissolution or winding up, holders of common stock will be
    entitled to share ratably in the net assets legally available
    for distribution to stockholders after the payment of all of our
    debts and other liabilities and the satisfaction of any
    liquidation preference granted to the holders of any then
    outstanding shares of preferred stock.
Rights and Preferences.
Holders of common
    stock have no preemptive, conversion, subscription or other
    rights, and there are no redemption or sinking fund provisions
    applicable to the common stock. The rights, preferences and
    privileges of the holders of common stock are subject to and may
    be adversely affected by, the rights of the holders of shares of
    any series of preferred stock that we may designate in the
    future.
64
Fully Paid and Nonassessable.
All of our
    outstanding shares of common stock are, and the shares of common
    stock to be issued in this offering will be, fully paid and
    nonassessable.
Certain Repurchase Rights and Voting Restrictions.
On October 15, 2009, we issued 1,219,512 shares of
    common stock and a warrant to purchase an additional
    609,756 shares of common stock to Sigma-Tau. The purchaser
    agreed to vote the shares purchased in the transaction, and any
    additional shares issued pursuant to the exercise of the warrant
    issued in the transaction, at the direction of our Board until
    September 30, 2012.
On April 30, 2009, we issued 1,052,631 shares of
    common stock and a warrant to purchase an additional
    263,158 shares of common stock to Sigma-Tau. The purchaser
    agreed to vote the shares purchased in the transaction, and any
    additional shares issued pursuant to the exercise of the warrant
    issued in the transaction, at the direction of our Board until
    April 30, 2012.
On December 10, 2008, we issued an aggregate of
    2,068,964 shares of common stock and warrants to purchase
    an additional 745,104 shares of common stock to Sigma-Tau.
    The purchasers agreed to vote the shares purchased in the
    transaction, and any additional shares issued pursuant to the
    exercise of the warrants issued in the transaction, at the
    direction of our Board until December 31, 2011.
On February 29, 2008, we issued an aggregate of
    5,000,000 shares of common stock and warrants to purchase
    an additional 1,000,000 shares of common stock to
    Sigma-Tau. We may, in our sole discretion, repurchase the shares
    issued in the transaction at any time until December 31,
    2010 for $2.50 per share. In addition, the purchasers agreed to
    vote the shares purchased in the transaction, and any additional
    shares issued pursuant to the exercise of the warrants issued in
    the transaction, at the direction of our Board until
    December 31, 2010.
On June 23, 2005, we issued an aggregate of
    1,538,461 shares of common stock to Sigma-Tau. The
    purchasers agreed to assign the right to vote the shares issued
    in the transaction to us until June 23, 2010. At the end of
    this period, we, in our sole discretion, may repurchase for
    $5.00 per share the number of shares required to reduce the
    aggregate equity ownership of the purchasers to 30.1% of our
    outstanding common stock.
Warrants
    to Be Issued as Part of the Units
The material terms and provisions of the warrants being offered
    pursuant to this prospectus are summarized below. This summary
    is subject to, and qualified in its entirety by, the form of
    warrant agreement and warrant certificate included as exhibits
    to the registration statement filed with the SEC of which this
    prospectus is a part. You should review copies of these items
    for a complete description of the terms and conditions
    applicable to the warrants.
Each warrant entitles the registered holder to purchase one
    share of our common stock at a price equal to
    $     , which represents 110% of the
    closing bid price of our common stock on the date of this
    prospectus. The warrants may only be exercised for cash. The
    warrants will expire five years from the date of this prospectus
    at 5:00 p.m., New York City time.
We may call the warrants for redemption as follows:
•
at a price of $0.01 per share for each warrant at any time while
    the warrants are exercisable, so long as a registration
    statement relating to the common stock issuable upon exercise of
    the warrants is effective and current;
•
upon not less than 30 days' prior written notice of
    redemption to each warrant holder; and
•
if, and only if, the last reported sale price of the common
    stock equals or exceeds $      per
    share for any 20 trading days within a period of 30 consecutive
    trading days.
If the foregoing conditions are satisfied and we call the
    warrants for redemption, each warrant holder will then be
    entitled to exercise his or her warrant prior to the date
    scheduled for redemption. However, there can
65
be no assurance that the price of the common stock will exceed
    the call price or the warrant exercise price after the
    redemption call is made.
The warrants will be issued in registered form under a warrant
    agreement between American Stock Transfer &
    Trust Company, as warrant agent, and us. We intend to apply
    for listing of the warrants on the NYSE Amex under the symbol
    "          ."
The exercise price and number of shares of common stock issuable
    on exercise of the warrants may be adjusted in certain
    circumstances, including but not limited to in the event of a
    stock split, stock dividend, recapitalization, reorganization,
    merger or consolidation. However, the warrants will not be
    adjusted for the issuances of common stock or securities
    convertible or exercisable into common stock at a price below
    their respective exercise prices.
The warrants may be exercised upon surrender of the warrant
    certificate on or prior to the expiration date at the offices of
    the warrant agent, with the exercise form on the reverse side of
    the warrant certificate completed and executed as indicated,
    accompanied by full payment of the exercise price, by certified
    check payable to us, for the number of warrants being exercised.
    The warrant holders do not have the rights or privileges of
    holders of common stock and any voting rights until they
    exercise their warrants and received shares of common stock.
    After issuance of shares of common stock upon exercise of the
    warrants, each holder will be entitled to one vote for each
    share held of record on all matters to be voted on by
    stockholders.
No warrants will be exercisable unless at the time of exercise a
    prospectus relating to common stock issuable upon exercise of
    the warrants is current and the common stock has been registered
    or qualified or deemed to be exempt under the securities laws of
    the state of residence of the holder of the warrants. Under the
    terms of the warrant agreement, we have agreed to meet these
    conditions and use our best efforts to maintain a current
    prospectus relating to common stock issuable upon exercise of
    the warrants until the expiration of the warrants. However, we
    cannot assure you that we will be able to do so, and if we do
    not maintain a current prospectus related to the common stock
    issuable upon exercise of the warrants, holders will be unable
    to exercise their warrants and we will not be required to settle
    any such warrant exercise. If the prospectus relating to the
    common stock issuable upon the exercise of the warrants is not
    current or if the common stock is not qualified or exempt from
    qualification in the jurisdictions in which the holders of the
    warrants reside, we will not be required to net cash settle or
    cash settle the warrant exercise, the warrants may have no
    value, the market for the warrants may be limited and the
    warrants may expire worthless.
Preferred
    Stock
Under our certificate of incorporation, our board of directors
    has the authority, without further action by the stockholders,
    to issue up to 1,000,000 shares of preferred stock in one
    or more series, to establish from time to time the number of
    shares to be included in each such series, to fix the rights,
    preferences and privileges of the shares of each wholly unissued
    series and any qualifications, limitations or restrictions
    thereon and to increase or decrease the number of shares of any
    such series, but not below the number of shares of such series
    then outstanding. Our board of directors has designated 200,000
    of the 1,000,000 authorized shares of preferred stock as
    Series A Participating Cumulative Preferred Stock, none of
    which shares are outstanding but which could be issued under the
    terms of the stockholder rights plan.
Our board of directors may authorize the issuance of preferred
    stock with voting or conversion rights that could adversely
    affect the voting power or other rights of the holders of the
    common stock. The issuance of preferred stock, while providing
    flexibility in connection with possible acquisitions and other
    corporate purposes, could, among other things, have the effect
    of delaying, deferring or preventing a change in control of our
    company and may adversely affect the market price of the common
    stock and the voting and other rights of the holders of common
    stock.
Stockholder Rights Plan.
Our Board adopted a
    Rights Agreement, dated April 29, 1994, as amended, often
    referred to as a "poison pill," as a tool to prevent
    an unsolicited takeover. In general, under our rights agreement,
    our Board has the discretion to issue certain rights to purchase
    our capital stock when a person acquires in excess of 25% of our
    outstanding common shares. These provisions may make it more
    difficult for
66
stockholders to take corporate actions and may have the effect
    of delaying or preventing a change in control, even if such
    actions or change in control would be in your best interests.
Delaware
    Anti-takeover Law and Certain Provisions of Our Amended and
    Restated Certificate of Incorporation and Bylaws
Delaware law.
We are subject to
    Section 203 of the Delaware General Corporation Law.
    Section 203 generally prohibits a public Delaware
    corporation from engaging in a business combination with an
    interested stockholder for a period of three years after the
    date of the transaction in which the person became an interested
    stockholder, unless:
•
prior to the date of the transaction, the board of directors of
    the corporation approved either the business combination or the
    transaction that resulted in the stockholder becoming an
    interested stockholder;
•
the interested stockholder owned at least 85% of the voting
    stock of the corporation outstanding at the time the transaction
    commenced, excluding for this purpose shares owned by persons
    who are directors and also officers and shares owned by employee
    stock plans in which employee participants do not have the right
    to determine confidentially whether shares held subject to the
    plan will be tendered in a tender or exchange offer; or
•
on or subsequent to the date of the transaction, the business
    combination is approved by the board and authorized at an annual
    or special meeting of stockholders, and not by written consent,
    by the affirmative vote of at least
    66
2
/
3
%
    of the outstanding voting stock that is not owned by the
    interested stockholder.
Section 203 defines a business combination to include:
•
any merger or consolidation involving the corporation and the
    interested stockholder;
•
any sale, transfer, pledge or other disposition involving the
    interested stockholder of 10% or more of the assets of the
    corporation;
•
subject to exceptions, any transaction that results in the
    issuance or transfer by the corporation of any stock of the
    corporation to the interested stockholder;
•
any transaction involving the corporation that has the effect of
    increasing the proportionate share of the stock or any class or
    series of the corporation beneficially owned by the interested
    stockholder; and
•
the receipt by the interested stockholder of the benefit of any
    loans, advances, guarantees, pledges or other financial benefits
    provided by or through the corporation.
In general, Section 203 defines an interested stockholder
    as any entity or person beneficially owning 15% or more of the
    outstanding voting stock of the corporation and any entity or
    person affiliated with or controlling or controlled by the
    entity or person.
Certificate of Incorporation and
    Bylaws.
Provisions of our restated certificate of
    incorporation and amended and restated bylaws may delay or
    discourage transactions involving an actual or potential change
    in our control or change in our management, including
    transactions in which stockholders might otherwise receive a
    premium for their shares, or transactions that our stockholders
    might otherwise deem to be in their best interests. Therefore,
    these provisions could adversely affect the price of our common
    stock.
Among other things, our restated certificate of incorporation
    and amended and restated bylaws:
•
permit our board of directors to issue up to
    1,000,000 shares of preferred stock, with any rights,
    preferences and privileges as they may designate, including the
    right to approve an acquisition or other change in our control;
•
provide that the authorized number of directors, which may not
    be less than three nor more than seven, may be changed only by
    resolution of the board of directors;
67
•
provide that stockholders seeking to present proposals before a
    meeting of stockholders or to nominate candidates for election
    as directors at a meeting of stockholders must provide notice in
    writing in a timely manner, and also specify requirements as to
    the form and content of a stockholder's notice;
•
do not provide for cumulative voting rights, therefore allowing
    the holders of a majority of the shares of common stock entitled
    to vote in any election of directors to elect all of the
    directors standing for election, if they should so
    choose; and
•
provide that special meetings of our stockholders may be called
    only by the chairman of the board, our chief executive officer
    or by the board of directors.
Transfer
    Agent and Registrar
The transfer agent and registrar for our common stock is
    American Stock Transfer & Trust Company. The
    transfer agent and registrar's address is 6201
    15th Street, Brooklyn, NY 11219.
NYSE Amex
    Listing
Our common stock is currently listed on the NYSE Amex under the
    trading symbol "RGN."
68
UNDERWRITING
Subject to the terms and conditions of the underwriting
    agreement between us and Maxim Group LLC, the sole book-running
    manager and sole representative of the underwriters, each
    underwriter named below has severally agreed to purchase from us
    on a firm commitment basis the following respective number of
    units of common stock and warrants to purchase common stock
    opposite its name below, at the public offering price less the
    underwriting discounts and commissions set forth on the cover
    page of this prospectus:
Underwriter
Number of Units
Maxim Group LLC
Boenning & Scattergood, Inc.
Total
The underwriting agreement provides for the purchase of a
    specific number of units by each of the underwriters. The
    underwriters' obligations are several, which means that
    each underwriter is required to purchase a specified number of
    units, but is not responsible for the commitment of any other
    underwriter to purchase units.
Subject to the terms of the underwriting agreement, the
    underwriters have agreed to purchase all of the units offered by
    this prospectus (other than those covered by the over-allotment
    option described below) if any are purchased. Under the
    underwriting agreement, if an underwriter defaults in its
    commitment to purchase units, the commitments of non-defaulting
    underwriters may be increased or the underwriting agreement may
    be terminated, depending on the circumstances. The underwriting
    agreement provides that the obligations of the underwriters to
    pay for and accept delivery of the units are subject to the
    passing upon certain legal matters by counsel and to certain
    other conditions, such as confirmation of the accuracy of our
    representations and warranties made in the underwriting
    agreement about our financial condition and operations.
We have been advised by the representative of the underwriters
    that the underwriters propose to offer the units to the public
    at the public offering price set forth on the cover of this
    prospectus and to dealers at a price that represents a
    concession not in excess of $      per
    unit. The underwriters may allow, and these dealers may
    re-allow, a concession of not more than
    $      per unit to other dealers. After
    the securities are released for sale to the public, the
    underwriters may change the offering price and other selling
    terms at various times.
Commissions
    and Expenses
The following table summarizes the underwriting discounts and
    commissions we will pay to the underwriters.
Total Without
Total With
Fee per
Exercise of
Exercise of
Unit(2)
Over-Allotment
Over-Allotment
Public offering price
$
$
$
Underwriting discount(1)
$
$
$
Proceeds, before expenses, to us
$
$
$
(1)
Does not include a corporate finance fee in the amount of 1% of
    the gross proceeds payable to the representative of the
    underwriters for structuring the terms of the offering.
(2)
The fees shown do not include the warrants to purchase shares of
    common stock issuable to the representative of the underwriters
    at the closing.
We estimate that the total expenses of the offering, including
    registration, filing and listing fees, printing fees, legal and
    accounting expenses and transfer and warrant agent fees, but
    excluding underwriting discounts and commissions, and not taking
    into account the underwriters' over-allotment option, will
    be approximately $     , all of which
    are payable by us.
69
Over-Allotment
    Option
We have granted the underwriters an over-allotment option. This
    option, which is exercisable for up to 45 days after the
    date of this prospectus, permits the underwriters to purchase a
    maximum
    of          
    additional units, consisting of an aggregate
    of           shares
    of common stock and warrants to purchase an aggregate
    of           shares
    of common stock, from us to cover over-allotments. If the
    underwriters exercise all or part of this option, they will
    purchase units covered by the option at the public offering
    price that appears on the cover page of this prospectus, less
    the underwriting discount. The underwriters have severally
    agreed that, to the extent the over-allotment option is
    exercised, they will each purchase a number of additional units
    proportionate to the underwriter's initial amount reflected
    in the foregoing table.
Underwriters'
    Warrants
We have also agreed to issue to the representative of the
    underwriters warrants to purchase a number of shares of our
    common stock equal to an aggregate of seven percent (7%) of the
    shares of common stock underlying units sold in the offering
    (or           shares).
    The warrants will have an exercise price equal to
    $      per share. The warrant is
    exercisable commencing six months following the closing of this
    offering, and will be exercisable for five years thereafter. The
    warrant is not redeemable by us, and allows for
    "cashless" exercise. The warrant also provides for one
    demand and for unlimited "piggyback" registration
    rights with respect to the underlying shares during the five
    year period commencing six months after the effective date of
    this offering. Pursuant to the rules of the Financial Industry
    Regulatory Authority, Inc., or FINRA, and in particular
    Rule 5110, the warrants (and underlying shares of common
    stock) issued to the representative of the underwriters may not
    be sold, transferred, assigned, pledged, or hypothecated, or the
    subject of any hedging, short sale, derivative, put or call
    transaction that would result in the effective disposition of
    the securities by any person for a period of 180 days
    immediately following the date of delivery and payment for the
    units offered; provided, however, the warrant (and underlying
    shares) may be transferred to officers or directors of the
    representative of the underwriters and members of the
    underwriting syndicate and their affiliates as long as the
    warrants (and underlying shares) remain subject to the lockup.
Lock-Up
Agreements
Our executive officers, directors and certain of our
    stockholders have agreed to a
90-day
"lock-up"
from the date of this prospectus of shares of our common stock
    that they beneficially own, including the issuance of common
    stock upon the exercise of currently outstanding options and
    options which may be issued. This means that, for a period of
    90 days following the date of this prospectus, such persons
    may not offer, sell, pledge or otherwise dispose of these
    securities without the prior written consent of the
    representative of the underwriters. The
lock-up
period described in the preceding paragraph will be extended if
    (1) during the last 17 days of the
lock-up
period we issue an earnings release or material news or a
    material event relating to us occurs or (2) prior to the
    expiration of the
lock-up
period we announce that we will release earnings results during
    the
16-day
period beginning on the last day of the
lock-up
period, in which case the
lock-up
period will be extended until the expiration of the
18-day
period beginning on the date of issuance of the earnings release
    or the occurrence of the material news or material event.
The representative of the underwriters has no present intention
    to waive or shorten the
lock-up
period; however, the terms of the
lock-up
agreements may be waived at its discretion. In determining
    whether to waive the terms of the lockup agreements, the
    representative of the underwriters may base its decision on its
    assessment of the relative strengths of the securities markets
    and companies similar to ours in general, and the trading
    pattern of, and demand for, our securities in general.
In addition, the underwriting agreement provides that we will
    not, for a period of 90 days following the date of this
    prospectus, offer, sell or distribute any of our securities,
    without the prior written consent of the representative of the
    underwriters.
70
Other
    Terms
We have advanced $50,000 to Maxim Group LLC, which represents a
    reasonable estimate of the actual accountable expenses Maxim
    Group LLC will incur in the offering. Maxim Group LLC shall only
    receive an accountable expense reimbursement if the offering is
    terminated. If the offering is consummated, Maxim Group LLC will
    not receive an expense reimbursement and will refund the advance
    to us at the closing of the offering.
We also have agreed that, upon successful completion of this
    offering, for a period of six (6) months from the closing
    of this offering, we will grant Maxim Group LLC the right of
    participation to act as lead managing underwriter and book
    runner or minimally as a co-lead manager and co-book runner
and/or
co-lead placement agent with at least 50.0% of the economics;
    or, in the case of a three-handed deal 33.0% of the economics,
    for any and all future equity offerings as well as any
    convertible debt offerings undertaken during this period by us.
The underwriting agreement provides for indemnification between
    us and the underwriters against specified liabilities, including
    liabilities under the Securities Act, and for contribution by us
    and the underwriters to payments that may be required to be made
    with respect to those liabilities. We have been advised that, in
    the opinion of the SEC, indemnification liabilities under the
    Securities Act is against public policy as expressed in the
    Securities Act, and is therefore, unenforceable.
This prospectus in electronic format may be made available on a
    website maintained by the representatives of the underwriters
    and may also be made available on a website maintained by other
    underwriters. The underwriters may agree to allocate a number of
    units to underwriters for sale to their online brokerage account
    holders. Internet distributions will be allocated by the
    representatives of the underwriters to underwriters that may
    make Internet distributions on the same basis as other
    allocations. In connection with the offering, the underwriters
    or syndicate members may distribute prospectuses electronically.
    No forms of electronic prospectus other than prospectuses that
    are printable as
    Adobe
®
PDF will be used in connection with this offering.
The underwriters have informed us that they do not expect to
    confirm sales of the securities offered by this prospectus to
    accounts over which they exercise discretionary authority
    without obtaining the specific approval of the account holder.
Stabilization
Until the distribution of the securities offered by this
    prospectus is completed, rules of the SEC may limit the ability
    of the underwriters to bid for and to purchase our common stock.
    As an exception to these rules, the underwriters may engage in
    transactions effected in accordance with Regulation M under
    the Securities Exchange Act of 1934 that are intended to
    stabilize, maintain or otherwise affect the price of our common
    stock or publicly traded warrants. The underwriters may engage
    in over-allotment sales, syndicate covering transactions,
    stabilizing transactions and penalty bids in accordance with
    Regulation M.
•
Stabilizing transactions permit bids or purchases for the
    purpose of pegging, fixing or maintaining the price of our
    common stock and publicly traded warrants, so long as
    stabilizing bids do not exceed a specified maximum.
•
Over-allotment involves sales by the underwriters of securities
    in excess of the number of securities the underwriters are
    obligated to purchase, which creates a short position. The short
    position may be either a covered short position or a naked short
    position. In a covered short position, the number of shares of
    common stock or warrants over-allotted by the underwriters is
    not greater than the number of shares of common stock or
    warrants that they may purchase in the over-allotment option. In
    a naked short position, the number of shares of common stock or
    warrants involved is greater than the number of shares of common
    stock or warrants in the over-allotment option. The underwriters
    may close out any covered short position by either exercising
    their over-allotment option or purchasing common stock or
    warrants in the open market.
71
•
Covering transactions involve the purchase of securities in the
    open market after the distribution has been completed in order
    to cover short positions. In determining the source of
    securities to close out the short position, the underwriters
    will consider, among other things, the price of securities
    available for purchase in the open market as compared to the
    price at which they may purchase securities through the
    over-allotment option. If the underwriters sell more shares of
    common stock or warrants than could be covered by the
    over-allotment option, creating a naked short position, the
    position can only be closed out by buying securities in the open
    market. A naked short position is more likely to be created if
    the underwriters are concerned that there could be downward
    pressure on the price of the shares of common stock or publicly
    traded warrants in the open market after pricing that could
    adversely affect investors who purchase in this offering.
•
Penalty bids permit the underwriters to reclaim a selling
    concession from a selected dealer when the securities originally
    sold by the selected dealer are purchased in a stabilizing or
    syndicate covering transaction.
These stabilizing transactions, covering transactions and
    penalty bids may have the effect of raising or maintaining the
    market price of our common stock or publicly traded warrants or
    preventing or retarding a decline in the market price of our
    common stock or publicly traded warrants. As a result, the price
    of our common stock or publicly traded warrants may be higher
    than the price that might otherwise exist in the open market.
Neither we nor the underwriters make any representation or
    prediction as to the effect that the transactions described
    above may have on the prices of our securities. These
    transactions may occur on the NYSE Amex or on any other trading
    market. If any of these transactions are commenced, they may be
    discontinued without notice at any time.
Foreign
    Regulatory Restrictions on Purchase of Units
We have not taken any action to permit a public offering of the
    units outside the United States or to permit the possession or
    distribution of this prospectus outside the United States.
    Persons outside the United States who come into possession of
    this prospectus must inform themselves about and observe any
    restrictions relating to this offering of units and the
    distribution of the prospectus outside the United States.
European Economic Area.
In relation to each
    Member State of the European Economic Area which has implemented
    the Prospectus Directive (each, a relevant member state), with
    effect from and including the date on which the Prospectus
    Directive is implemented in that relevant member state (the
    relevant implementation date) an offer of securities to the
    public in that relevant member state prior to the publication of
    a prospectus in relation to the securities that have been
    approved by the competent authority in that relevant member
    state or, where appropriate, approved in another relevant member
    state and notified to the competent authority in that relevant
    member state, all in accordance with the Prospectus Directive,
    except that, with effect from and including the relevant
    implementation date, an offer of securities may be offered to
    the public in that relevant member state at any time:
•
to any legal entity that is authorized or regulated to operate
    in the financial markets or, if not so authorized or regulated,
    whose corporate purpose is solely to invest in securities;
•
to any legal entity which has two or more of (1) an average
    of at least 250 employees during the last financial year;
    (2) a total balance sheet of more than €43,000,000 and
    (3) an annual net turnover of more than €50,000,000,
    as shown in its last annual or consolidated accounts;
•
to fewer than 100 natural or legal persons (other than qualified
    investors as defined in the Prospectus Directive) subject to
    obtaining the prior consent of for any such offer; or
•
in any other circumstances which do not require the publication
    of a prospectus pursuant to Article 3 of the Prospectus
    Directive.
72
Each purchaser of securities described in this prospectus
    located within a relevant member state will be deemed to have
    represented, acknowledged and agreed that it is a
    "qualified investor" within the meaning of
    Article 2(1)(e) of the Prospectus Directive.
For the purposes of this provision, the expression an
    "offer to the public" in any relevant member state
    means the communication in any form and by any means of
    sufficient information on the terms of the offer and the
    securities to be offered so as to enable an investor to decide
    to purchase or subscribe the securities, as the expression may
    be varied in that member state by any measure implementing the
    Prospectus Directive in that member state and the expression
    "Prospectus Directive" means Directive 2003/71/EC and
    includes any relevant implementing measure in each relevant
    member state.
Israel.
The units offered by this prospectus
    have not been approved or disapproved by the Israeli Securities
    Authority (ISA). The units may not be offered or sold, directly
    or indirectly, to the public in Israel. The ISA has not issued
    permits, approvals or licenses in connection with the offering
    of the units or publishing the prospectus; nor has it
    authenticated the details included herein, confirmed their
    reliability or completeness, or rendered an opinion as to the
    quality of the securities being offered. Any resale, directly or
    indirectly, to the public of the units offered by this
    prospectus is subject to restrictions on transferability and
    must be effected only in compliance with the Israeli securities
    laws and regulations.
United Kingdom.
In the United Kingdom, the
    units offered by this prospectus are directed to and will only
    be available for purchase to a person who is an exempt person as
    referred to at paragraph (c) below and who warrants,
    represents and agrees that: (a) it has not offered or sold,
    will not offer or sell, any units offered by this prospectus to
    any person in the United Kingdom except in circumstances which
    do not constitute an offer to the public in the United Kingdom
    for the purposes of section 85 of the Financial Services
    and Markets Act 2000 (as amended) ("FSMA"); and
    (b) it has complied and will comply with all applicable
    provisions of FSMA and the regulations made thereunder in
    respect of anything done by it in relation to the units offered
    by this prospectus in, from or otherwise involving the United
    Kingdom; and (c) it is a person who falls within the
    exemptions to Section 21 of the FSMA as set out in The
    Financial Services and Markets Act 2000 (Financial Promotion)
    Order 2005 ("the Order"), being either an investment
    professional as described under Article 19 or any body
    corporate (which itself has or a group undertaking has a called
    up share capital or net assets of not less than £500,000
    (if more than 20 members) or otherwise £5 million) or
    an unincorporated association or partnership (with net assets of
    not less than £5 million) or is a trustee of a high
    value trust or any person acting in the capacity of director,
    officer or employee of such entities as defined under
    Article 49(2)(a) to (d) of the Order, or a person to
    whom the invitation or inducement may otherwise lawfully be
    communicated or cause to be communicated. The investment
    activity to which this document relates will only be available
    to and engaged in only with exempt persons referred to above.
    Persons who are not investment professionals and do not have
    professional experience in matters relating to investments or
    are not an exempt person as described above, should not review
    nor rely or act upon this document and should return this
    document immediately. It should be noted that this document is
    not a prospectus in the United Kingdom as defined in the
    Prospectus Regulations 2005 and has not been approved by the
    Financial Services Authority or any competent authority in the
    United Kingdom.
Italy.
This offering of the units has not been
    cleared by Consob, the Italian Stock Exchanges regulatory agency
    of public companies, pursuant to Italian securities legislation
    and, accordingly, no units may be offered, sold or delivered,
    nor may copies of this prospectus or of any other document
    relating to the units to be distributed in Italy, except
    (1) to professional investors (operatori qualificati); or
    (2) in circumstances which are exempted from the rules on
    solicitation of investments pursuant to Decree No. 58 and
    Article 33, first paragraph, of Consob
    Regulation No. 11971 of May 14, 1999, as amended.
    Any offer, sale or delivery of the securities or distribution of
    copies of this prospectus or any other document relating to the
    securities in Italy under (1) or (2) above must be
    (i) made by an investment firm, bank or financial
    intermediary permitted to conduct such activities in Italy in
    accordance with the Decree No. 58 and Legislative Decree
    No. 385 of September 1, 1993, or the Banking Act; and
    (ii) in compliance with Article 129 of the Banking Act
    and the implementing guidelines of the Bank of Italy, as amended
    from time to time, pursuant to which the issue or the offer of
    securities in Italy may need to be preceded and followed by an
    appropriate notice to be filed with
73
the Bank of Italy depending,
inter alia
, on the aggregate
    value of the securities issued or offered in Italy and their
    characteristics; and (iii) in compliance with any other
    applicable laws and regulations.
Germany.
The offering of the units is not a
    public offering in the Federal Republic of Germany. The units
    may only be acquired in accordance with the provisions of the
    Securities Sales Prospectus Act
    (Wertpapier-Verkaufsprospektgesetz), as amended, and any other
    applicable German law. No application has been made under German
    law to publicly market the securities in or out of the Federal
    Republic of Germany. The units are not registered or authorized
    for distribution under the Securities Sales Prospectus Act and
    accordingly may not be, and are not being, offered or advertised
    publicly or by public promotion. Therefore, this prospectus is
    strictly for private use and the offering is only being made to
    recipients to whom the document is personally addressed and does
    not constitute an offer or advertisement to the public. The
    units will only be available to persons who, by profession,
    trade or business, buy or sell securities for their own or a
    third party's account.
France.
The units offered by this prospectus
    may not be offered or sold, directly or indirectly, to the
    public in France. This prospectus has not been or will not be
    submitted to the clearance procedure of the Autorité des
    Marchés Financiers, or the AMF, and may not be released or
    distributed to the public in France. Investors in France may
    only purchase the securities offered by this prospectus for
    their own account and in accordance with articles L.
411-1,
L.
441-2
and L.
412-1
of the
    Code Monétaire et Financier and decree
no. 98-880
dated October 1, 1998, provided they are "qualified
    investors" within the meaning of said decree. Each French
    investor must represent in writing that it is a qualified
    investor within the meaning of the aforesaid decree. Any resale,
    directly or indirectly, to the public of the units offered by
    this prospectus may be effected only in compliance with the
    above mentioned regulations.
"Les actions offertes par ce document d'information ne
    peuvent pas être, directement ou indirectement, offertes ou
    vendues au public en France. Ce document d'information
    n'a pas été ou ne sera pas soumis au visa de
    l'Autorité des Marchés Financiers et ne peut
    être diffusé ou distribué au public en France.
    Les investisseurs en France ne peuvent acheter les actions
    offertes par ce document d'information que pour leur compte
    propre et conformément aux articles L.
411-1,
L.
441-2
et L.
412-1
du
    Code Monétaire et Financier et du décret
no. 98-880
du 1 octobre 1998, sous réserve qu'ils soient des
    investisseurs qualifiés au sens du décret
    susvisé. Chaque investisseur doit déclarer par
    écrit qu'il est un investisseur qualifié au sens
    du décret susvisé. Toute revente, directe ou
    indirecte, des actions offertes par ce document
    d'information au public ne peut être effectuée
    que conformément à la réglementation
    susmentionnée."
Switzerland.
This prospectus may only be used
    by those persons to whom it has been directly handed out by the
    offeror or its designated distributors in connection with the
    offer described therein. The units are only offered to those
    persons
and/or
entities directly solicited by the offeror or its designated
    distributors, and are not offered to the public in Switzerland.
    This prospectus constitutes neither a public offer in
    Switzerland nor an issue prospectus in accordance with the
    respective Swiss legislation, in particular but not limited to
    Article 652A Swiss Code Obligations. Accordingly, this
    prospectus may not be used in connection with any other offer,
    whether private or public and shall in particular not be
    distributed to the public in Switzerland.
Norway.
This prospectus has not been produced
    in accordance with the prospectus requirements laid down in the
    Norwegian Securities Trading Act 1997 as amended. This
    prospectus has not been approved or disapproved by, or
    registered with, neither the Oslo Stock Exchange nor the
    Norwegian Registry of Business Enterprises. This prospectus may
    not, either directly or indirectly be distributed to other
    Norwegian potential investors than the addressees without the
    prior consent of Vringo, Inc.
Denmark.
This prospectus has not been prepared
    in the context of a public offering of securities in Denmark
    within the meaning of the Danish Securities Trading Act
    No. 171 of 17 March 2005 as amended from time to time
    or any Executive Orders issued on the basis thereof and has not
    been and will not be filed with or approved by or filed with the
    Danish Financial Supervisory Authority or any other public
    authorities in Denmark. The offering of units will only be made
    to persons pursuant to one or more of the exemptions set out in
    Executive Order No. 306 of 28 April 2005 on
    Prospectuses for Securities Admitted for Listing or Trade on a
    Regulated Market and on the First Public Offer of Securities
    exceeding EUR 2,500,000 or Executive
74
Order No. 307 of 28 April 2005 on Prospectuses for the
    First Public Offer of Certain Securities between
    EUR 100,000 and EUR 2,500,000, as applicable.
Sweden.
Neither this prospectus nor the units
    offered hereunder have been registered with or approved by the
    Swedish Financial Supervisory Authority under the Swedish
    Financial Instruments Trading Act (1991:980) (as amended), nor
    will such registration or approval be sought. Accordingly, this
    prospectus may not be made available nor may the units offered
    hereunder be marketed or offered for sale in Sweden other than
    in circumstances which are deemed not to be an offer to the
    public in Sweden under the Financial Instruments Trading Act.
    This prospectus may not be distributed to the public in Sweden
    and a Swedish recipient of the prospectus may not in any way
    forward the prospectus to the public in Sweden.
British Virgin Islands.
No shares, warrants or
    units of the Company shall be offered or sold, directly or
    indirectly, to the public or any member of the public in the
    British Virgin Islands.
Relationships
Certain of the underwriters or their affiliates have provided
    from time to time and may in the future provide investment
    banking, lending, financial advisory and other related services
    to us and our affiliates for which they have received and may
    continue to receive customary fees and commissions.
LEGAL
    MATTERS
The validity of the securities being offered by this prospectus
    will be passed upon for us by Cooley Godward Kronish LLP,
    Reston, Virginia. The underwriters are being represented by
    Lowenstein Sandler PC, Roseland, New Jersey.
EXPERTS
Reznick Group P.C., independent registered public accounting
    firm, has audited our financial statements at December 31,
    2009 and 2008, and for each of the two years in the period ended
    December 31, 2009, as set forth in their report, which
    includes an explanatory paragraph relating to our ability to
    continue as a going concern. We have included our financial
    statements in this prospectus and elsewhere in the registration
    statement of which it is a part in reliance on Reznick
    Group's report, given on their authority as experts in
    accounting and auditing.
WHERE YOU
    CAN FIND ADDITIONAL INFORMATION
We have filed with the SEC a registration statement on
Form S-1
under the Securities Act, with respect to the securities being
    offered by this prospectus. This prospectus does not contain all
    of the information in the registration statement and its
    exhibits. For further information with respect to RegeneRx and
    the securities offered by this prospectus, we refer you to the
    registration statement and its exhibits. Statements contained in
    this prospectus as to the contents of any contract or any other
    document referred to are not necessarily complete, and in each
    instance, we refer you to the copy of the contract or other
    document filed as an exhibit to the registration statement. Each
    of these statements is qualified in all respects by this
    reference.
We are subject to the information reporting requirements of the
    Exchange Act, and we file reports, proxy statements and other
    information with the SEC. You can read our SEC filings,
    including the registration statement, over the Internet at the
    SEC's website at
www.sec.gov
. You may also read and
    copy any document we file with the SEC at its public reference
    facilities at 100 F Street, N.E.,
    Washington, D.C. 20549. You may also obtain copies of these
    documents at prescribed rates by writing to the Public Reference
    Section of the SEC at 100 F Street, N.E.,
    Washington, D.C. 20549. Please call the SEC at
1-800-SEC-0330
for further information on the operation of the public reference
    facilities.
75
We also maintain a website at
www.regenerx.com
, at which
    you may access these materials free of charge as soon as
    reasonably practicable after they are electronically filed with,
    or furnished to, the SEC. The information contained in, or that
    can be accessed through, our website is not part of, and is not
    incorporated into, this prospectus.
DISCLOSURE
    OF COMMISSION POSITION ON INDEMNIFICATION FOR
SECURITIES ACT LIABILITY
Insofar as indemnification for liabilities arising under the
    Securities Act may be permitted to directors, officers or
    persons controlling the registrant pursuant to the foregoing
    provisions, the registrant has been informed that in the opinion
    of the SEC such indemnification is against public policy as
    expressed in the Securities Act and is, therefore, unenforceable.
76
RegeneRx
    Biopharmaceuticals, Inc.
Index
    to Financial Statements
Page
Report of Independent Registered Public
    Accounting Firm
F-2
Balance Sheets
F-3
Statements of Operations
F-4
Statements of Changes in Stockholders'
    Equity
F-5
Statements of Cash Flows
F-6
Notes to Financial Statements
F-7
F-1
REPORT OF
    INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and Stockholders of
RegeneRx Biopharmaceuticals, Inc.
We have audited the accompanying balance sheets of RegeneRx
    Biopharmaceuticals, Inc. (the "Company") as of
    December 31, 2009 and 2008, and the related statements of
    operations, changes in stockholders' equity, and cash flows
    for each of the years in the two-year period ended
    December 31, 2009. The Company's management is
    responsible for these financial statements. Our responsibility
    is to express an opinion on these financial statements based on
    our audits.
We conducted our audits in accordance with the standards of the
    Public Company Accounting Oversight Board (United States). Those
    standards require that we plan and perform the audit to obtain
    reasonable assurance about whether the financial statements are
    free of material misstatement. The Company is not required to
    have, nor were we engaged to perform, an audit of its internal
    control over financial reporting. Our audit included
    consideration of internal control over financial reporting as a
    basis for designing audit procedures that are appropriate in the
    circumstances, but not for the purpose of expressing an opinion
    on the effectiveness of the Company's internal control over
    financial reporting. Accordingly, we express no such opinion. An
    audit also includes examining, on a test basis, evidence
    supporting the amounts and disclosures in the financial
    statements, 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 RegeneRx Biopharmaceuticals, Inc. as of December 31,
    2009 and 2008, and the results of its operations and its cash
    flows for each of the years in the two-year period ended
    December 31, 2009 in conformity with accounting principles
    generally accepted in the United States of America.
The accompanying financial statements have been prepared
    assuming that the Company will continue as a going concern. As
    more fully described in Note 1 to the financial statements,
    the Company has experienced negative cash flows from operations
    since inception and is dependent upon future financing in order
    to meet its planned operating activities. These conditions raise
    substantial doubt about the Company's ability to continue
    as a going concern. Management's plans regarding these
    matters are described in Note 1. The financial statements
    do not include any adjustments that might result from the
    outcome of this uncertainty.
/s/ REZNICK GROUP, P.C.
Vienna, Virginia
March 31, 2010
F-2
RegeneRx
    Biopharmaceuticals, Inc.
Balance Sheets
December 31,
December 31,
2009
2008
ASSETS
Current assets
Cash and cash equivalents
$
4,355,768
$
5,655,367
Prepaid expenses and other current assets
196,546
236,477
Total current assets
4,552,314
5,891,844
Property and equipment, net of accumulated depreciation of
    $98,171 and $81,623
8,492
25,039
Other assets
22,948
5,693
Total assets
$
4,583,754
$
5,922,576
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable
$
140,206
$
70,554
Accrued expenses
740,198
1,255,358
Total current liabilities
880,404
1,325,912
Commitments
—
—
Stockholders' equity
Preferred stock, $.001 par value per share,
    1,000,000 shares authorized; no shares issued
—
—
Common stock, $.001 par value per share,
    100,000,000 shares authorized; 60,406,828 and 53,622,491
    issued and outstanding
60,407
53,623
Additional paid-in capital
88,144,347
82,550,585
Accumulated deficit
(84,501,404
)
(78,007,544
)
Total stockholders' equity
3,703,350
4,596,664
Total liabilities and stockholders' equity
$
4,583,754
$
5,922,576
The accompanying notes are an integral part of these financial
    statements.
F-3
RegeneRx
    Biopharmaceuticals, Inc.
Statements of Operations
Years Ended December 31,
2009
2008
Sponsored research revenue
$
—
$
168,412
Operating expenses
Research and development
3,724,514
7,149,808
General and administrative
2,781,790
3,805,346
Total operating expenses
6,506,304
10,955,154
Loss from operations
(6,506,304
)
(10,786,742
)
Interest income
12,444
149,777
Net loss
$
(6,493,860
)
$
(10,636,965
)
Basic and diluted net loss per common share
$
(0.12
)
$
(0.21
)
Weighted average number of common shares outstanding
55,680,525
50,967,617
The accompanying notes are an integral part of these financial
    statements.
F-4
RegeneRx
    Biopharmaceuticals, Inc.
Statements of Changes in Stockholders'
    Equity
Years
    ended December 31, 2009 and 2008
Accumulated
Other
Total
Common Stock
Additional
Accumulated
Comprehensive
Stockholders'
Shares
Amount
Paid-in Capital
Deficit
Income/(loss)
Equity
Balance, December 31, 2007
46,553,527
$
46,554
$
73,513,292
$
(67,405,579
)
$
(1,543
)
$
6,152,724
Cumulative effect of a change in accounting
    principle — ASC Topic 730
—
—
—
35,000
—
35,000
Issuance of common stock, net of offering costs of $52,240
7,068,964
7,069
7,940,691
—
—
7,947,760
Share-based compensation expense
—
—
1,096,602
—
—
1,096,602
Net loss
—
—
—
(10,636,965
)
—
(10,636,965
)
Unrealized gain on available for sale securities
—
—
—
—
1,543
1,543
Total comprehensive loss
(10,635,422
)
Balance, December 31, 2008
53,622,491
53,623
82,550,585
(78,007,544
)
$
—
$
4,596,664
Issuance of common stock, net of offering costs of $447,933
6,784,337
6,784
4,845,282
—
—
4,852,066
Share-based compensation expense
—
—
748,480
—
—
748,480
Net loss
—
—
—
(6,493,860
)
—
(6,493,860
)
Balance, December 31, 2009
60,406,828
$
60,407
$
88,144,347
$
(84,501,404
)
$
—
$
3,703,350
The accompanying notes are an integral part of these financial
    statements.
F-5
RegeneRx
    Biopharmaceuticals, Inc.
Statements of Cash Flows
Years Ended December 31,
2009
2008
Operating activities:
Net loss
$
(6,493,860
)
$
(10,636,965
)
Adjustments to reconcile net loss to net cash used in operating
    activities:
Depreciation and amortization
16,547
19,396
Non-cash share-based compensation
748,480
1,096,602
Gain on settlement of accrued expenses
(100,000
)
—
Changes in operating assets and liabilities:
Accounts receivable
—
26,951
Prepaid expenses and other current assets
39,931
66,767
Other assets
(17,255
)
—
Accounts payable
69,652
(203,007
)
Accrued expenses
(415,160
)
(940,150
)
Net cash used in operating activities
(6,151,665
)
(10,570,406
)
Investing activities:
Sales/maturities of short-term investments
—
4,581,135
Net cash provided by investing activities
—
4,581,135
Financing activities:
Net proceeds from issuance of common stock
4,852,066
7,947,760
Net cash provided by financing activities
4,852,066
7,947,760
Net (decrease) increase in cash and cash equivalents
(1,299,599
)
1,958,489
Cash and cash equivalents at beginning of year
5,655,367
3,696,878
Cash and cash equivalents at end of year
$
4,355,768
$
5,655,367
The accompanying notes are an integral part of these financial
    statements.
F-6
RegeneRx
    Biopharmaceuticals, Inc.
Notes
    to Financial Statements
1.
ORGANIZATION
    AND BUSINESS
Organization and Nature of
    Operations.
RegeneRx Biopharmaceuticals, Inc.
    (the "Company", "We", "Us",
    "Our"), a Delaware corporation, was incorporated in
    1982. We are focused on the discovery and development of novel
    molecules to accelerate tissue and organ repair. Our operations
    are confined to one business segment: the development and
    marketing of product candidates based on Thymosin Beta 4
    ("Tß4"), an amino acid peptide.
Management Plans to Address Operating
    Conditions.
We have incurred net losses of
    $6.5 million and $10.6 million for the years ended
    December 31, 2009 and 2008, respectively. Since inception,
    and through December 31, 2009, we have an accumulated
    deficit of $84.5 million and we had cash and cash
    equivalents of $4.4 million as of December 31, 2009.
    Based on our operating plan, we believe that our cash and cash
    equivalents will fund our operations into the third quarter of
    2010.
We anticipate incurring additional losses in the future as we
    continue to explore the potential clinical benefits of
    Tß4-based product candidates over multiple indications. We
    will need substantial additional funds in order to initiate any
    further preclinical studies or clinical trials, and to fund our
    operations beyond the third quarter of 2010. Accordingly, we
    will have a need for financing and are in the process of
    exploring various alternatives, including, without limitation, a
    public or private placement of our securities, debt financing or
    corporate collaboration and licensing arrangements or the sale
    of our company or certain of our intellectual property rights.
These factors raise substantial doubt about our ability to
    continue as a going concern. The accompanying financial
    statements have been prepared assuming that we will continue as
    a going concern. This basis of accounting contemplates the
    recovery of our assets and the satisfaction of our liabilities
    in the normal course of business.
Although we intend to continue to seek additional financing or a
    strategic partner, we may not be able to complete a financing or
    corporate transaction, either on favorable terms or at all. If
    we are unable to complete a financing or strategic transaction,
    we may not be able to continue as a going concern after our
    funds have been exhausted, and we could be required to
    significantly curtail or cease operations, file for bankruptcy
    or liquidate and dissolve. There can be no assurance that we
    will be able to obtain any sources of funding. The financial
    statements do not include any adjustments relating to the
    recoverability and classification of recorded asset amounts and
    classification of liabilities that might be necessary should we
    be forced to take any such actions.
In addition to our current operational requirements, we expect
    to continue to expend substantial funds to complete our planned
    product development efforts. Additionally, we continually refine
    our operating strategy and evaluate alternative clinical uses of
    Tß4. However, substantial additional resources will be
    needed before we will be able to achieve sustained
    profitability. Consequently, we continually evaluate alternative
    sources of financing such as the sharing of development costs
    through strategic collaboration agreements. There can be no
    assurance that our financing efforts will be successful, and if
    we are not able to obtain sufficient levels of financing, we
    would delay certain clinical
and/or
research activities, and our financial condition would be
    materially and adversely affected. Even if we are able to obtain
    sufficient funding, other factors including competition,
    dependence on third parties, uncertainty regarding patents,
    protection of proprietary rights, manufacturing of peptides and
    technology obsolescence could have a significant impact on us
    and our operations.
To achieve profitability we must successfully conduct
    pre-clinical studies and clinical trials, obtain required
    regulatory approvals and successfully manufacture and market
    those pharmaceuticals we wish to commercialize. The time
    required to reach profitability is highly uncertain, and there
    can be no assurance that we will be able to achieve sustained
    profitability, if at all.
F-7
RegeneRx
    Biopharmaceuticals, Inc.
Notes to
    Financial Statements — (Continued)
2.
SUMMARY
    OF SIGNIFICANT ACCOUNTING POLICIES
Use of Estimates.
The preparation of financial
    statements in conformity with accounting principles generally
    accepted in the United Stated of America
    ("U.S. GAAP") requires management to make certain
    estimates and assumptions that affect the reported earnings,
    financial position and various disclosures. Critical accounting
    policies involved in applying our accounting policies are those
    that require management to make assumptions about matters that
    are highly uncertain at the time the accounting estimate was
    made and those for which different estimates reasonably could
    have been used for the current period. Critical accounting
    estimates are also those which are reasonably likely to change
    from period to period, and would have a material impact on the
    presentation of our financial condition, changes in financial
    condition or results of operations. Our most critical accounting
    estimates relate to accounting policies for clinical trial
    accruals and share-based arrangements. Management bases its
    estimates on historical experience and on various other
    assumptions that it believes are reasonable under the
    circumstances. Actual results could differ from these estimates.
Cash and Cash Equivalents.
Cash and cash
    equivalents consist of cash and highly-liquid investments with
    original maturities of three months or less when acquired and
    are stated at cost that approximates their fair market value.
Concentration of Credit Risk.
Financial
    instruments, which potentially subject the Company to
    concentrations of credit risk, consist primarily of cash, and
    cash equivalents. We limit our exposure to credit loss by
    placing our cash and cash equivalents with high quality
    financial institutions and, in accordance with our investment
    policy, in securities that are rated investment grade.
Property and Equipment.
Property and equipment
    consists of office furniture and equipment, and is stated at
    cost and depreciated over the estimated useful lives of the
    assets (generally two to five years) using the straight-line
    method. Expenditures for maintenance and repairs which do not
    significantly prolong the useful lives of the assets are charged
    to expense as incurred. Depreciation expense was $16,547 and
    $19,396 for the years ended December 31, 2009 and 2008,
    respectively.
Impairment of Long-lived Assets.
When we
    record long-lived assets our policy is to regularly perform
    reviews to determine if and when the carrying value of our
    long-lived assets becomes impaired. During the two years ended
    December 31, 2009 we did not report qualifying long-lived
    assets and therefore no impairment losses were recorded.
Sponsored Research Revenues.
We account for
    non-refundable grants as "Sponsored research revenues"
    in the accompanying statements of operations. Revenues are
    recognized when the associated research has been performed and
    the related underlying costs are incurred.
Research and Development.
Research and
    development ("R&D") costs are expensed as
    incurred and include all of the wholly-allocable costs
    associated with our various clinical programs passed through to
    us by our outsourced vendors. Those costs include: manufacturing
    Tß4; formulation of Tß4 into the various product
    candidates; stability for both Tß4 and the various
    formulations; pre-clinical toxicology; safety and
    pharmacokinetic studies; clinical trial management; medical
    oversight; laboratory evaluations; statistical data analysis;
    regulatory compliance; quality assurance; and other related
    activities. R&D includes cash and non-cash compensation,
    employee benefits, travel and other miscellaneous costs of our
    internal R&D personnel, seven persons in total, who are
    wholly dedicated to R&D efforts. R&D also includes a
    pro-ration of our common infrastructure costs for office space
    and communications.
On January 1, 2008, pursuant to Accounting Standards
    Codification ("ASC")
730-20
(formerly EITF Issue
No. 07-3,
"Accounting for Advance Payments for Goods or Services to
    Be Used in Future Research and Development Activities"),
    "Research and Development Costs," we changed our
    accounting for non-refundable advance payments to acquire goods
    or pay for services that will be consumed or performed in a
    future period
F-8
RegeneRx
    Biopharmaceuticals, Inc.
Notes to
    Financial Statements — (Continued)
in conducting research and development activities on behalf of
    the entity. Advance payments are recorded as an asset when the
    advance payments are made. Capitalized amounts are recognized as
    expense when the research and development activities are
    performed; that is, when the goods without alternative future
    use are acquired or the service is rendered. We determined that
    approximately $35,000 in qualifying transactions required
    capitalization as of January 1, 2008, and accordingly
    recognized a cumulative-effect adjustment to our accumulated
    deficit as of that date.
Cost of Preclinical Studies and Clinical
    Trials.
We accrue estimated costs for preclinical
    studies based on estimates of work performed. We estimate
    expenses incurred for clinical trials that are in process based
    on patient enrollment and based on clinical data collection and
    management. Costs based on clinical data collection and
    management are recognized based on estimates of unbilled goods
    and services received in the reporting period. We monitor the
    progress of the trials and their related activities and adjust
    the accruals accordingly. Adjustments to accruals are charged to
    expense in the period in which the facts that give rise to the
    adjustment become known. In the event of early termination of a
    clinical trial, we would accrue an amount based on estimates of
    the remaining non-cancelable obligations associated with winding
    down the clinical trial.
Patent Costs.
Costs related to filing and
    pursuing patent applications are recognized as general and
    administrative expenses as incurred since recoverability of such
    expenditures is uncertain.
Income Taxes.
Income taxes are accounted for
    under the asset and liability method. Deferred tax assets and
    liabilities are recognized for the estimated future tax
    consequences attributable to differences between the financial
    statement carrying amounts of existing assets and liabilities
    and their respective tax bases and operating loss and tax credit
    carryforwards. Deferred tax assets and liabilities are measured
    using enacted tax rates expected to apply to taxable income in
    the years in which those temporary differences are expected to
    be recovered or settled. The effect on deferred tax assets and
    liabilities of a change in tax rates is recognized in income in
    the period that includes the enactment date. We recognize the
    effect of income tax positions only if those positions are more
    likely than not of being sustained. Recognized income tax
    positions are measured at the largest amount that is greater
    than 50% likely of being realized. Changes in recognition or
    measurement are reflected in the period in which the change in
    judgment occurs. The Company's policy for recording
    interest and penalties associated with audits is that penalties
    and interest expense are recorded in "Income taxes" in
    the Company's statements of operations.
The ultimate realization of deferred tax assets is dependent
    upon the generation of future taxable income during the periods
    in which those temporary differences become deductible.
    Management considers the scheduled reversal of deferred tax
    liabilities, projected future taxable income, and tax planning
    strategies in making that assessment. We recorded a full
    valuation allowance against all estimated net deferred tax
    assets at December 31, 2009 and 2008. We have significant
    net operating loss carryforwards to potentially reduce future
    federal and state taxable income, and research and
    experimentation tax credit carryforwards available to
    potentially offset future federal and state income taxes. Use of
    our net operating loss and research and experimentation credit
    carryforwards may be limited due to changes in our ownership as
    defined within Section 382 of the Internal Revenue Code.
Net Loss Per Common Share.
Net loss per common
    share for the years ended December 31, 2009 and 2008,
    respectively, is based on the weighted-average number of shares
    of common stock outstanding during the periods. Basic and
    diluted loss per share are identical for all periods presented
    as potentially dilutive securities have been excluded from the
    calculation of the diluted net loss per common share because the
    inclusion of such securities would be antidilutive. The
    potentially dilutive securities include 12,847,963 shares
    and 9,366,590 shares in 2009 and 2008, respectively,
    reserved for the exercise of outstanding options and warrants.
F-9
RegeneRx
    Biopharmaceuticals, Inc.
Notes to
    Financial Statements — (Continued)
Share-Based Compensation.
We measure
    share-based compensation expense based on the grant date fair
    value of the awards which is then recognized over the period
    which service is required to be provided. We estimate the grant
    date fair value using the Black-Scholes option-pricing model
    ("Black-Scholes"). We recognized $748,480 and
    $1,096,602 in share-based compensation expense for the years
    ended December 31, 2009 and 2008, respectively.
Fair Value of Financial Instruments.
The
    carrying amounts of our financial instruments, as reflected in
    the accompanying balance sheets, approximate fair value.
    Financial instruments consist of cash and cash equivalents, and
    accounts payable.
Recent Accounting Pronouncements.
In February
    2010, the Financial Accounting Standards Board
    ("FASB") issued Accounting Standards Update (ASU
    2010 — 09) to address potential practice issues
    associated with FASB ASC 855 (formerly SFAS 165),
    "Subsequent Events." The ASU was effective upon
    issuance and eliminated the requirement for entities that file
    or furnish financial statements with the SEC to disclose the
    date through which subsequent events have been evaluated in
    originally issued and reissued financial statements. Other
    entities would continue to be required to disclose the date
    through which subsequent events have been evaluated; however,
    disclosures about the date would be required only in financial
    statements revised because of an error correction or
    retrospective application of U.S. GAAP. Our adoption of
    this standard changed our presentation of subsequent events when
    preparing our financial statements.
In September 2009, the FASB ratified ASU
2009-13
(formerly
EITF 08-1),
"Revenue Recognition" (ASC 605):
    Multiple-Deliverable Revenue Arrangements, the final consensus
    reached by the Emerging Issues Task Force that revised the
    authoritative guidance for revenue arrangements with multiple
    deliverables. The guidance addresses how to determine whether an
    arrangement involving multiple deliverables contains more than
    one unit of accounting and how the arrangement consideration
    should be allocated among the separate units of accounting. The
    guidance will be effective for our fiscal year beginning
    January 1, 2011 with early adoption permitted. The guidance
    may be applied retrospectively or prospectively for new or
    materially modified arrangements. We currently do not have any
    multiple-deliverable revenue arrangements, accordingly, the
    adoption of the guidance will not have an impact on our
    financial statements.
In August 2009, the FASB issued ASU
No. 2009-05,
"Fair Value Measurements and Disclosures
    (ASC 820) — Measuring Liabilities at Fair
    Value" (ASU
2009-05).
ASU
2009-05
provides clarification that in circumstances in which a quoted
    price in an active market for the identical liability is not
    available, a reporting entity is required to measure fair value
    using a valuation technique that uses the quoted price of the
    identical liability when traded as an asset or the quoted prices
    for similar liabilities or similar liabilities when traded as
    assets. The guidance provided is effective for the first
    reporting period (including interim periods) beginning after
    issuance. Our adoption of ASU
2009-05
did
    not impact our financial position or results of operations.
In June 2009, the FASB issued ASC 105 (formerly
    SFAS 168), "The FASB Accounting Standards Codification
    and the Hierarchy of Generally Accepted Accounting
    Principles" (ASC 105). ASC 105 is now the source of
    authoritative U.S. GAAP recognized by the FASB to be
    applied by nongovernment entities. It also modifies the GAAP
    hierarchy to include only two levels of GAAP: authoritative and
    non-authoritative. ASC 105 is effective for financial
    statements issued for interim and annual periods ended after
    September 15, 2009. The adoption of this standard in 2009
    changed how we reference various elements of U.S. GAAP when
    preparing our financial statement disclosures, but did not have
    an impact on our financial position or results of operations.
Other new pronouncements issued but not effective until after
    December 31, 2009 are not expected to have a significant
    effect on our financial position or results of operations.
Reclassifications.
Certain account balances as
    of and for the year ended December 31, 2008 were
    reclassified to conform to current year presentation.
F-10
RegeneRx
    Biopharmaceuticals, Inc.
Notes to
    Financial Statements — (Continued)
3.
FAIR
    VALUE MEASUREMENTS
We adopted a new accounting standard that defines fair value and
    establishes a framework for fair value measurements effective
    January 1, 2008 for financial assets and liabilities and
    effective January 1, 2009 for non-financial assets and
    liabilities. This standard establishes a three-level hierarchy
    for fair value measurements. The hierarchy is based upon the
    transparency of inputs and the valuation of an asset or a
    liability as of the measurement date. The three levels of inputs
    are as follows:
•
Level 1 — Quoted prices in active markets for
    identical assets and liabilities.
•
Level 2 — Observable inputs other than quoted
    prices in active markets for identical assets and liabilities.
•
Level 3 — Unobservable inputs.
At December 31, 2009 and 2008, we held no qualifying
    liabilities, and our only qualifying assets that required
    measurement under the foregoing fair value hierarchy were money
    market funds and U.S. Treasury Bills included in Cash and
    Cash Equivalents valued at $4.4 million and
    $5.7 million, respectively, using Level 1 inputs.
4.
LICENSES,
    INTELLECTUAL PROPERTY, AND RELATED PARTY TRANSACTIONS
We have an exclusive, worldwide licensing agreement with the
    National Institutes of Health ("NIH") for all claims
    to Tß4 within their broadly-defined patent application. In
    exchange for this exclusive worldwide license, we must make
    certain royalty and milestone payments to the NIH. Through
    December 31, 2009 we have complied with these requirements.
    No assurance can be given as to whether or when a patent will be
    issued, or as to any claims that may be included or excluded
    within the patent. We have also filed numerous additional patent
    applications covering various compositions, uses, formulations
    and other components of Tß4, as well as to novel peptides
    resulting from our research efforts. Some of these patents have
    issued, while many patent applications are still pending.
    Minimum annual maintenance fees for each of the years ended
    December 31, 2009 and 2008 were $25,000.
We have entered into a License and Supply Agreement (the
    "Agreement") with Defiante Farmaceutica, S.A.
    ("Defiante") a Portuguese company that is a wholly
    owned subsidiary of Sigma-Tau, S.p.A., an international
    pharmaceutical company and an affiliate of Sigma-Tau Finanziaria
    S.p.A., who together with its affiliates comprise our largest
    stockholder group (the "Sigma-Tau Group"). This
    Agreement grants to Defiante the exclusive right to use Tß4
    to conduct research and development activities in Europe. Under
    the Agreement, we will receive fees and royalty payments based
    on a percentage of specified sales of Tß4-related products
    by Defiante. The term of the Agreement continues until the later
    of the expiration of any patents developed under the Agreement,
    the expiration of marketing rights, or December 31, 2016.
In furtherance of the licensed rights, Sigma-Tau Group funded
    and managed the RegeneRx-sponsored Phase II dermal wound
    healing clinical trials in venous stasis ulcers conducted in
    Italy and Poland that concluded in the first quarter of 2009.
F-11
RegeneRx
    Biopharmaceuticals, Inc.
Notes to
    Financial Statements — (Continued)
5.
COMPOSITION
    OF CERTAIN FINANCIAL STATEMENT CAPTIONS
Accrued expenses are comprised of the following:
December 31,
2009
2008
Accrued clinical research
$
496,997
$
944,283
Accrued professional fees
122,590
155,000
Accrued vacation
35,300
61,714
Accrued license fees
30,000
—
Accrued compensation
28,995
84,361
Other
26,316
10,000
$
740,198
$
1,255,358
6.
EMPLOYEE
    BENEFIT PLANS
We have a defined contribution retirement plan that complies
    with Section 401(k) of the Internal Revenue Code (the
    "Code"). All employees of the Company are eligible to
    participate in the plan. The Company matches 100% of each
    participant's voluntary contributions, subject to a maximum
    Company contribution of 4% of the participant's
    compensation. The Company's matching portion totaled
    $18,269 and $51,494 for the years ended December 31, 2009
    and 2008, respectively. In order to conserve cash, the Company
    discontinued the matching contribution effective June 5,
    2009 and reinstated it on March 1, 2010.
7.
STOCKHOLDERS'
    EQUITY
Shareholders Rights Plan.
Our Board of
    Directors adopted a Rights Agreement, dated April 29, 1994,
    as amended, that is intended to discourage an unsolicited change
    in control of the Company. In general, if an entity acquires
    more than a 25% ownership interest in the Company without the
    endorsement of our Board of Directors, then our current
    stockholders (other than the acquiring entity) will be issued a
    significant number of new shares, the effect of which would
    dilute the ownership of the acquiring entity and could delay or
    prevent the change in control.
Registration Rights Agreements.
In connection
    with the sale of certain equity instruments, we have entered
    into Registration Rights Agreements. Generally, these Agreements
    required us to file registration statements with the Securities
    and Exchange Commission to register common shares to permit
    re-sale of common shares previously sold under an exemption from
    registration or to register common shares that may be issued on
    exercise of outstanding warrants.
The Registration Rights Agreements usually require us to pay
    penalties for any failure or time delay in filing or maintaining
    the effectiveness of the required registration statements. These
    penalties are usually expressed as a fixed percentage, per
    month, of the original amount we received on issuance of the
    common shares, options or warrants. While to date we have not
    incurred any penalties under these agreements, if a penalty is
    determined to be probable we would recognize the amount as a
    contingent liability and not as a derivative instrument.
Common Stock.
In February 2008, the Company
    sold 5,000,000 shares of its common stock at a price of
    $1.00 per share, raising net proceeds of $4,947,760 (the
    "February 2008 Private Placement") from Sigma Tau
    Group. In connection with the February 2008 Private Placement,
    the Company also issued warrants to the investors. The warrants
    are exercisable for an aggregate of 1,000,000 shares of
    common stock at an exercise price of $1.60 per share. The
    warrants, which have a term of three years and an exercise price
    of $1.60 per
F-12
RegeneRx
    Biopharmaceuticals, Inc.
Notes to
    Financial Statements — (Continued)
share, were valued using the Black-Scholes option-pricing model
    as of the closing date and accounted for in permanent equity.
    The estimated fair market value of the warrants at the date of
    issuance was $0.3 million.
Under the terms of the February 2008 Private Placement, the
    Company may, in its sole discretion, repurchase the shares at
    any time between January 1, 2010 and December 31,
    2010, for $2.50 per share. The Company's repurchase right
    terminates after December 31, 2010. In addition, the
    investors have agreed to vote the shares, and any additional
    shares issued pursuant to the exercise of the warrants, as
    recommended by the Company's Board of Directors until
    December 31, 2010.
In December 2008, the Company sold 2,068,964 shares of its
    common stock at a price of $1.45 per share, raising net proceeds
    of $3,000,000 (the "December 2008 Private Placement")
    from Sigma Tau Group. In connection with the December 2008
    Private Placement, the Company also issued warrants to the
    investors. The warrants are exercisable for an aggregate of
    745,104 shares of common stock at an exercise price of
    $1.74 per share. The warrants, which have a term of three years
    and an exercise price of $1.74 per share, were valued using the
    Black-Scholes option-pricing model as of the closing date and
    accounted for in permanent equity. The estimated fair market
    value of the warrants at the date of issuance was
    $0.4 million.
Under the terms of the December 2008 Private Placement, the
    investors have agreed to vote the shares, and any additional
    shares issued pursuant to the exercise of the warrants, as
    recommended by the Company's Board of Directors until
    December 31, 2011.
On April 30, 2009 we issued 1,052,631 shares of common
    stock at a price of $0.57 per share, and warrants to purchase
    263,158 shares of our common stock at $0.91 per share, to
    Sigma-Tau Group for gross proceeds of $600,000. The warrants,
    which have a term of three years and an exercise price of $0.91
    per share, were valued using the Black-Scholes option-pricing
    model as of the closing date and accounted for in permanent
    equity. The estimated fair market value of the warrants at the
    date of issuance was $0.1 million.
On October 5, 2009, we issued 4,512,194 shares of
    common stock and warrants to purchase 2,256,097 shares of
    our common stock in a registered direct offering to new
    institutional investors, for proceeds of approximately
    $3.3 million, net of approximately $400,000 of offering
    costs. The warrants, which have a term of five years and an
    exercise price of $1.12 per share, were valued using the
    Black-Scholes option-pricing model as of the closing date and
    accounted for in permanent equity. The estimated fair market
    value of the warrants at the date of issuance was
    $1.0 million.
On October 15, 2009, we issued 1,219,512 shares of
    common stock and warrants to purchase 609,756 shares of our
    common stock to Sigma-Tau Group for gross proceeds of
    $1.0 million. The warrants, which become exercisable on
    April 15, 2010 and have a term through September 30,
    2014, and an exercise price of $1.12 per share, were valued
    using the Black-Scholes option-pricing model as of the closing
    date and accounted for in permanent equity. The estimated fair
    market value of the warrants at the date of issuance was
    $0.2 million.
Share-Based Compensation.
We recognized
    $748,480 and $1,096,602 in stock-based compensation expense for
    the years ended December 31, 2009 and 2008, respectively.
    Given our current estimates of future forfeitures, we expect to
    recognize the compensation cost related to non-vested options as
    of December 31, 2009 of $723,000 over the weighted average
    remaining recognition period of 1.1 years.
2000 Stock Option and Incentive Plan, as
    amended.
Our Board of Directors (the
    "Board") and stockholders have approved the 2000 Stock
    Option and Incentive Plan under which the Board may grant
    options to purchase shares of our common stock. Options may only
    be granted to our directors, officers, employees, consultants or
    advisors, and no single participant can receive more than
    450,000 shares in any one year. The exercise price and term
    of any grant are determined by the Board at the time of grant
    but the exercise price may not be less than the fair market
    value of our common stock on the date of the grant, and the term
    of the option shall not exceed ten years. As of
    December 31, 2009, there were 6,500,000 shares
F-13
RegeneRx
    Biopharmaceuticals, Inc.
Notes to
    Financial Statements — (Continued)
reserved for issuance under the plan, of which 4,914,112 were
    outstanding and 1,550,888 were available for issuance.
The following summarizes share-based compensation expense for
    the years ended December 31, 2009 and 2008, which was
    allocated as follows:
December 31,
2009
2008
Research and development
$
369,814
$
440,850
General and administrative
378,666
655,752
$
748,480
$
1,096,602
The following summarizes stock option activity for the years
    ended December 31, 2009 and 2008:
Options Outstanding
Weighted
Shares
Average
Available for
Number of
Exercise Price
Exercise
Grant
Shares
Range
Price
December 31, 2007
620,000
3,545,000
$
0.28 - $3.82
$
1.80
Grants
(572,500
)
572,500
1.14 - 1.50
1.23
Exercises
—
—
—
—
Cancellations
—
—
—
—
Newly authorized
2,300,000
—
—
—
December 31, 2008
2,347,500
4,117,500
0.28 - 3.82
1.72
Grants
(1,192,939
)
1,192,939
0.57  -  0.76
0.64
Exercises
—
—
—
—
Cancellations
396,327
(396,327
)
0.57 - 2.59
0.82
December 31, 2009
1,550,888
4,914,112
$
0.28 - $3.82
$
1.53
The following summarizes information about stock options
    outstanding at December 31, 2009:
Outstanding Options
Exercisable Options
Weighted-
Weighted-
Average
Weighted-
Average
Weighted-
Number of
Remaining
Average
Number of
Remaining
Average
Shares
Contractual
Exercise
Shares
Contractual
Exercise
Range of Exercise Prices
Outstanding
Life (in Years)
Price
Exercisable
Life (in Years)
Price
$0.28-$0.86
2,151,612
4.5
$
0.50
1,724,112
4.0
$
0.43
$1.07-$1.93
827,500
5.0
$
1.31
435,625
4.6
$
1.40
$2.02-$2.68
860,000
4.3
$
2.26
323,750
4.4
$
2.31
$3.00-$3.82
1,075,000
5.4
$
3.19
950,832
5.4
$
3.19
4,914,112
3,434,319
Intrinsic value of
in-the-money
options, using the December 31, 2009 closing price of $0.55
$
254,450
$
254,450
Determining the Fair Value of Options.
We use
    the Black-Scholes valuation model to estimate the fair value of
    options granted. Black-Scholes considers a number of factors,
    including the market price and
F-14
RegeneRx
    Biopharmaceuticals, Inc.
Notes to
    Financial Statements — (Continued)
volatility of our common stock. We used the following
    forward-looking range of assumptions to value each stock option
    granted to employees, directors and consultants during the years
    ended December 31, 2009 and 2008:
2009
2008
Dividend yield
0.0%
0.0%
Risk free rate of return
1.9 - 2.3%
0.8 - 3.7%
Expected life in years
4.75 - 5.38
1.00 - 4.75
Volatility
71 - 72%
68 - 82%
Forfeitures
2.61%
—
Our dividend yield assumption is based on the fact that we have
    never paid cash dividends and do not anticipate paying cash
    dividends in the foreseeable future. Our risk-free interest rate
    assumption is based on yields of U.S. Treasury notes in
    effect at the date of grant. Our expected life represents the
    period of time that options granted are expected to be
    outstanding and is calculated in accordance with the Securities
    and Exchange Commission ("SEC") guidance provided in
    the SEC's Staff Accounting Bulletin 107
    ("SAB 107"), using a "simplified"
    method. The Company has used the simplified method and will
    continue to use the simplified method as it does not have
    sufficient historical exercise data to provide a reasonable
    basis upon which to estimate an expected term. Our volatility
    assumption is based on reviews of the historical volatility of
    our common stock. We estimate forfeiture rates at the time of
    grant and adjust these estimates, if necessary, periodically
    based on the extent to which future actual forfeitures differ,
    or are expected to differ, from such estimates. Accordingly, we
    have estimated forfeiture percentages for the unvested portion
    of previously granted awards that remain outstanding at the date
    of adoption and for awards granted subsequent to the date of
    adoption. Forfeitures are estimated based on the demographics of
    current option holders and standard probabilities of employee
    turnover. Using Black-Scholes and these factors, the weighted
    average fair value of stock options granted to employees and
    directors was $0.39 for the year ended December 31, 2009
    and $0.73 for the year ended December 31, 2008.
We do not record tax-related effects on stock-based compensation
    given our historical and anticipated operating experience and
    offsetting changes in our valuation allowance which fully
    reserves against potential deferred tax assets.
Warrants
    to Purchase Common Stock.
The following table summarizes our warrant activity for 2009 and
    2008:
Warrants Outstanding
Weighted
Average
Number of
Exercise Price
Exercise
Shares
Range
Price
December 31, 2007
3,522,544
$
2.75 - $4.06
$
3.26
Grants
1,745,104
1.60 - 1.74
1.66
Exercises
—
—
—
Cancellations
(18,558
)
4.05 - 4.06
4.05
December 31, 2008
5,249,090
1.60 - 4.06
2.80
Grants
3,129,011
0.91 - 1.12
1.10
Exercises
—
—
—
Cancellations
(444,250
)
4.06
4.06
December 31, 2009
7,933,851
$
0.91 - $4.06
$
2.01
F-15
RegeneRx
    Biopharmaceuticals, Inc.
Notes to
    Financial Statements — (Continued)
8.
INCOME
    TAXES
Significant components of the Company's deferred tax assets
    at December 31, 2009 and 2008 and related valuation
    reserves are presented below:
December 31,
2009
2008
Deferred tax assets:
Net operating loss carryforwards
$
16,988,000
$
18,370,000
Research and development tax credit carryforward
1,710,000
1,628,000
Charitable contribution carryforward
37,000
39,000
Accrued vacation
8,000
12,000
Accrued expenses
163,000
150,000
Amortization
5,000
6,000
Depreciation
1,000
—
Stock option expense
975,000
919,000
19,887,000
21,124,000
Less — valuation allowance
(19,887,000
)
(21,123,000
)
Net deferred tax asset
—
1,000
Deferred tax liabilities:
Depreciation
—
(1,000
)
Net deferred tax amounts
$
—
$
—
A full valuation allowance has been provided at
    December 31, 2009 and 2008 to reserve for deferred tax
    assets, as it appears more likely than not that net deferred tax
    assets will not be realized.
At December 31, 2009, we had net operating loss
    carryforwards for income tax purposes of approximately
    $43.1 million, which are available to offset future federal
    and state taxable income, if any, and, research and development
    tax credit carryforwards of approximately $1.7 million. The
    carryforwards, if not utilized, will expire in increments
    through 2029.
The Code imposes substantial restrictions on the utilization of
    net operating losses and tax credits in the event of a
    corporation's ownership change, as defined in
    Section 382 of the Code. During 2009, the Company completed
    a preliminary study to compute any limits on the net operating
    losses and credit carryforwards for purposes of
    Section 382. It was determined that the Company experienced
    a cumulative change in ownership, as defined by the regulations,
    in 2002. This change in ownership triggers an annual limitation
    on the Company's ability to utilize certain
    U.S. federal and state net operating loss carryforwards and
    research tax credit carryforwards, resulting in the potential
    loss of approximately $9.8 million of net operating loss
    carryforwards and $0.2 million in research credit
    carryforwards. The Company has reduced the deferred tax assets
    associated with these carryforwards in its balance sheet at
    December 31, 2009 and 2008.
F-16
RegeneRx
    Biopharmaceuticals, Inc.
Notes to
    Financial Statements — (Continued)
The provision for income taxes on earnings subject to income
    taxes differs from the statutory Federal rate at
    December 31, 2009 and 2008, due to the following:
December 31,
2009
2008
Tax benefit at statutory rate
$
(2,213,000
)
$
(3,617,000
)
State taxes
(354,000
)
(579,000
)
Permanent M-1s
339,000
563,000
Limited/expired net operating loss carryforwards
3,546,000
6,150,000
Limited/expired research and development tax credit carryforward
120,000
284,000
Research and development tax credit carryforward
(202,000
)
(504,000
)
Change in effective tax rate
—
(455,000
)
Change in valuation allowance
(1,236,000
)
(1,842,000
$
—
$
—
As discussed in Note 2, we recognize the effect of income
    tax positions only if those positions more likely than not of
    being sustained. At December 31, 2009, and
    December 31, 2008 we had no gross unrecognized tax
    benefits. We do not expect any significant changes in
    unrecognized tax benefits over the next 12 months. In
    addition, we did not recognize any interest or penalties related
    to uncertain tax positions at December 31, 2009 and 2008.
9.
COMMITMENTS
Lease.
Our rent expense, related solely to
    office space, for 2009 and 2008 was $91,183 and $100,196,
    respectively. We are committed under an office space lease that
    expires on January 31, 2013 that requires the following
    approximate annual lease payments: $63,000, $94,000, $98,000 and
    $8,000 for the years ending December 31, 2010, through
    2013, respectively.
Employment Continuity Agreements.
We have
    entered into employment contracts with our executive officers
    which provide for severance if the executive is dismissed
    without cause or under certain circumstances after a change of
    control in our ownership. At December 31, 2009 these
    obligations, if triggered, could amount to a maximum of
    approximately $900,000 in the aggregate.
F-17
Units
Common Stock
Warrants
PROSPECTUS
Maxim Group LLC
Boenning &
    Scattergood, Inc.
,
    2010
PART II
INFORMATION
    NOT REQUIRED IN PROSPECTUS
Item 13.
Other
    Expenses of Issuance and Distribution.
The following table sets forth all costs and expenses, other
    than underwriting discounts and commissions, payable by us in
    connection with the sale of the common stock being registered.
    All amounts shown are estimates except for the SEC registration
    fee, the FINRA filing fee and the NYSE Amex listing fee.
Amount to
be Paid
SEC registration fee
$
855.60
FINRA filing fee
1,700
NYSE Amex listing fee
*
Reimbursable expenses of the underwriters
*
Printing and engraving expenses
*
Legal fees and expenses
*
Blue Sky fees and expenses
*
Accounting fees and expenses
*
Transfer agent and registrar fees and expenses
*
Miscellaneous expenses
*
Total
$
*
*
To be filed by amendment.
Item 14.
Indemnification
    of Directors and Officers.
We are incorporated under the laws of the State of Delaware.
    Section 102(b)(7) of the Delaware General Corporation Law,
    or DGCL, permits a corporation to provide in its certificate of
    incorporation that a director of the corporation shall not be
    personally liable to the corporation or its stockholders for
    monetary damages for breach of fiduciary duties as a director,
    except for liability for any:
•
transaction from which the director derives an improper personal
    benefit;
•
act or omission not in good faith or that involves intentional
    misconduct or a knowing violation of law;
•
unlawful payment of dividends or redemption of shares; or
•
breach of a director's duty of loyalty to the corporation
    or its stockholders.
Our restated certificate of incorporation includes such a
    provision.
Section 145 of the DGCL provides that a Delaware
    corporation may indemnify any persons who are, or are threatened
    to be made, parties to any threatened, pending or completed
    action, suit or proceeding, whether civil, criminal,
    administrative or investigative (other than an action by or in
    the right of such corporation), by reason of the fact that such
    person was an officer, director, employee or agent of such
    corporation, or is or was serving at the request of such person
    as an officer, director, employee or agent of another
    corporation or enterprise. Our amended and restated bylaws
    include such a provision. The indemnity may include expenses
    (including attorneys' fees), judgments, fines and amounts
    paid in settlement actually and reasonably incurred by such
    person in connection with such action, suit or proceeding,
    provided that such person acted in good faith and in a manner he
    or she reasonably believed to be in or not opposed to the
    corporation's best interests and, with respect to any
    criminal action or proceeding, had no reasonable cause to
    believe that his or her conduct was unlawful.
II-1
Section 145 of the DGCL also provides that a Delaware
    corporation may indemnify any persons who are, or are threatened
    to be made, a party to any threatened, pending or completed
    action or suit by or in the right of the corporation by reason
    of the fact that such person was a director, officer, employee
    or agent of such corporation, or is or was serving at the
    request of such corporation as a director, officer, employee or
    agent of another corporation or enterprise. Our amended and
    restated bylaws contain such a provision. The indemnity may
    include expenses (including attorneys' fees) actually and
    reasonably incurred by such person in connection with the
    defense or settlement of such action or suit provided such
    person acted in good faith and in a manner he or she reasonably
    believed to be in or not opposed to the corporation's best
    interests except that no indemnification is permitted without
    judicial approval if the officer or director is adjudged to be
    liable to the corporation. Where an officer or director is
    successful on the merits or otherwise in the defense of any
    action referred to above, the corporation must indemnify him or
    her against the expenses that such officer or director has
    actually and reasonably incurred.
Expenses incurred by any indemnitee in defending or
    investigating a threatened or pending action, suit or proceeding
    in advance of its final disposition shall be paid by us upon
    delivery to us of an undertaking, by or on behalf of such
    indemnitee, to repay all amounts so advanced if it shall
    ultimately be determined that such indemnitee is not entitled to
    be indemnified by us. No advance will be made by us if a
    determination is reasonably and promptly made by our board of
    directors by a majority vote of a quorum of disinterested
    directors, or if such a quorum is not obtainable or, even if
    obtainable, a quorum of disinterested directors so directs, by
    independent legal counsel in a written opinion, that, based upon
    the facts known to the board or counsel at the time such
    determination is made, such person did not meet the applicable
    standard of conduct in order to be indemnified.
At present, there is no pending litigation or proceeding
    involving any of our directors or officers as to which
    indemnification is required or permitted, and we are not aware
    of any threatened litigation or proceeding that may result in a
    claim for indemnification.
We have an insurance policy covering our officers and directors
    with respect to certain liabilities, including liabilities
    arising under the Securities Act or otherwise.
We plan to enter into an underwriting agreement that provides
    that the underwriters are obligated, under some circumstances,
    to indemnify our directors, officers and controlling persons
    against specified liabilities, including liabilities under the
    Securities Act.
Item 15.
Recent
    Sales of Unregistered Securities.
The following list sets forth information regarding all
    unregistered securities sold by us since January 1, 2007
    through the date of this registration statement.
1) In February 2008, we issued and sold
    5,000,000 shares of common stock at a price of $1.00 per
    share, and warrants to purchase an aggregate of
    1,000,000 shares of common stock at an exercise price of
    $1.60 per share, to two accredited investors for aggregate
    consideration of approximately $5.0 million.
2) In December 2008, we issued and sold
    2,068,964 shares of common stock at a price of $1.45 per
    share, and warrants to purchase an aggregate of
    745,104 shares of common stock at an exercise price of
    $1.74 per share, to two accredited investors for aggregate
    consideration of approximately $3.0 million.
3) On April 30, 2009 we issued and sold
    1,052,631 shares of common stock at a price of $0.57 per
    share, and warrants to purchase an aggregate of
    263,158 shares of common stock at an exercise price of
    $0.91 per share, to one accredited investor for aggregate
    consideration of $600,000.
4) On October 5, 2009, we issued and sold
    4,512,194 shares of common stock at a price of $0.82 per
    share, and warrants to purchase an aggregate of
    2,256,097 shares of common stock at an exercise price of
    $1.12 per share, to three accredited investors for aggregate
    consideration of $3.7 million.
5) On October 15, 2009, we issued and sold
    1,219,512 shares of common stock at a price of $0.82 per
    share, and warrants to purchase an aggregate of
    609,756 shares of common stock at an exercise price of
    $1.12 per share, to one accredited investor for aggregate
    consideration of $1.0 million.
II-2
The offers, sales and issuances of the securities described in
    paragraphs (1) through (5) were exempt from
    registration under the Securities Act under Section 4(2) of
    the Securities Act and Regulation D promulgated thereunder
    as transactions by an issuer not involving a public offering.
    The recipients of securities in each of these transactions
    acquired the securities for investment only and not with a view
    to or for sale in connection with any distribution thereof and
    appropriate legends were affixed to the securities issued in
    these transactions. Each of the recipients of securities in
    these transactions was an accredited investor as defined in
    Rule 501 promulgated under the Securities Act.
Item 16.
Exhibits
    and Financial Statement Schedules.
(a)
Exhibits
Exhibit
Number
Description of Document
1
.1†
Form of Underwriting Agreement.
3
.1
Restated Certificate of Incorporation.
3
.2
Certificate of Amendment of Restated Certificate of
    Incorporation.
3
.3
Certificate of Amendment of Restated Certificate of
    Incorporation.
3
.4
Certificate of Designation of Series A Participating Cumulative
    Preferred Stock.
3
.5(1)
Amended and Restated Bylaws adopted July 26, 2006.
3
.6(2)
Amendment to Amended and Restated Bylaws.
4
.1
Specimen Common Stock Certificate.
4
.2
Specimen Rights Certificate.
4
.3
Rights Agreement, dated April 29, 1994, between the Company and
    American Stock Transfer & Trust Company, as Rights Agent.
4
.4
Amendment No. 1 to Rights Agreement, dated March 4, 2004,
    between the Company and American Stock Transfer & Trust
    Company, as Rights Agent.
4
.5†
Form of Warrant Agreement.
4
.6†
Form of Warrant Certificate.
5
.1†
Opinion of Cooley Godward Kronish LLP.
10
.1+(3)
Amended and Restated 2000 Stock Option and Incentive Plan, as
    amended.
10
.2*(4)
Patent License Agreement — Exclusive, dated
    January 24, 2001, between the Company and the U.S. Public Health
    Service.
10
.3*(5)
Thymosin Beta 4 License and Supply Agreement, dated January 21,
    2004, between the Company and Defiante Farmaceutica S.A.
10
.4(6)
Lease by and between RegeneRx Biopharmaceuticals, Inc. and The
    Realty Associates Fund V, L.P., dated December 10, 2009.
10
.5+(8)
Second Amended and Restated Employment Agreement, dated March
    11, 2009, between the Company and Allan L. Goldstein, as amended.
10
.6+(7)
Second Amended and Restated Employment Agreement, dated March
    12, 2009, between the Company and J.J. Finkelstein, as amended.
10
.7+(7)
Second Amended and Restated Employment Agreement, dated March
    31, 2009, between the Company and C. Neil Lyons, as amended.
10
.8+(7)
Second Amended and Restated Employment Agreement, dated March
    31, 2009, between the Company and David Crockford.
10
.1(9)
Stock Purchase Agreement, dated as of June 23, 2005.
10
.2(10)
Form of Warrant to Purchase Common Stock, dated March 17, 2006.
10
.3(11)
Form of Warrant to Purchase Common Stock, dated December 18,
    2006.
10
.4(11)
Registration Rights Agreement, dated as of December 15, 2006.
10
.5(12)
Securities Purchase Agreement, dated as of February 27, 2008.
II-3
Exhibit
Number
Description of Document
10
.6(12)
Form of Warrant to Purchase Common Stock, dated February 29,
    2008.
10
.7(13)
Securities Purchase Agreement, dated as of December 10, 2008.
10
.8(13)
Form of Warrant to Purchase Common Stock, dated December 10,
    2008.
10
.9(14)
Securities Purchase Agreement, dated as of April 13, 2009.
10
.10(14)
Form of Warrant to Purchase Common Stock, dated April 30, 2009.
10
.11(15)
Securities Purchase Agreement, dated as of September 30, 2009.
10
.12(15)
Form of Warrant to Purchase Common Stock, dated October 5, 2009.
10
.13(16)
Securities Purchase Agreement, dated as of September 30,
    2009.
10
.14(16)
Form of Warrant to Purchase Common Stock, dated October 15, 2009.
23
.1
Consent of Reznick Group, P.C., independent registered
    public accounting firm.
23
.2†
Consent of Cooley Godward Kronish LLP (included in Exhibit 5.1).
24
.1
Power of Attorney.  Reference is made to the signature page
    hereto.
(1)
Filed as an exhibit to the registrant's Quarterly Report on
Form 10-Q
for the quarter ended June 30, 2006 filed with the
    Securities and Exchange Commission on August 14, 2006 and
    incorporated herein by reference.
(2)
Filed as an exhibit to the registrant's Registration
    Statement on
Form S-8
(File No.
333-152250)
filed with the Securities and Exchange Commission on
    July 10, 2008 and incorporated herein by reference.
(3)
Filed as Annex A to the registrant's definitive proxy
    statement on Schedule 14A filed with the Securities and
    Exchange Commission on May 9, 2008 and incorporated herein
    by reference.
(4)
Filed as an exhibit to the registrant's Annual Report on
Form 10-KSB
for the year ended December 31, 2000 (File
No. 1-15070)
filed with the Securities and Exchange Commission on
    April 2, 2001 and incorporated herein by reference.
(5)
Filed as an exhibit to the registrant's Registration
    Statement on
Form SB-2
(File No.
333-113417)
filed with the Securities and Exchange Commission on
    March 9, 2004 and incorporated herein by reference.
(6)
Filed as an exhibit to the registrant's Annual Report on
Form 10-K
for the year ended December 31, 2009 filed with the
    Securities and Exchange Commission on March 31, 2010 and
    incorporated herein by reference.
(7)
Filed as an exhibit to the registrant's Annual Report on
Form 10-K
for the year ended December 31, 2008 filed with the
    Securities and Exchange Commission on April 15, 2009 and
    incorporated herein by reference.
(8)
Filed as an exhibit to Amendment No. 1 the
    registrant's Annual Report on
Form 10-K/A
for the year ended December 31, 2008 filed with the
    Securities and Exchange Commission on April 30, 2009 and
    incorporated herein by reference.
(9)
Filed as an exhibit to the registrant's Current Report on
Form 8-K
filed with the Securities and Exchange Commission on
    June 23, 2005 and incorporated herein by reference.
(10)
Filed as an exhibit to the registrant's Current Report on
Form 8-K
filed with the Securities and Exchange Commission on
    March 7, 2006 and incorporated herein by reference.
(11)
Filed as an exhibit to the registrant's Current Report on
Form 8-K
filed with the Securities and Exchange Commission on
    December 18, 2006 and incorporated herein by reference.
(12)
Filed as an exhibit to the registrant's Current Report on
Form 8-K
filed with the Securities and Exchange Commission on
    February 27, 2008 and incorporated herein by reference.
(13)
Filed as an exhibit to the registrant's Current Report on
Form 8-K
filed with the Securities and Exchange Commission on
    December 12, 2008 and incorporated herein by reference.
(14)
Filed as an exhibit to the registrant's Current Report on
Form 8-K
filed with the Securities and Exchange Commission on
    April 16, 2009 and incorporated herein by reference.
II-4
(15)
Filed as an exhibit to the registrant's Current Report on
Form 8-K
filed with the Securities and Exchange Commission on
    September 30, 2009 and incorporated herein by reference.
(16)
Filed as an exhibit to the registrant's Current Report on
Form 8-K
filed with the Securities and Exchange Commission on
    October 5, 2009 and incorporated herein by reference.
†
To be filed by amendment.
+
Indicates management contract or compensatory plan.
*
The registrant has been granted confidential treatment with
    respect to certain portions of this exhibit (indicated by
    asterisks), which have been filed separately with the Securities
    and Exchange Commission.
(b)
Financial Statement Schedules
No financial statement schedules are provided because the
    information called for is not required or is shown either in the
    financial statements or the notes thereto.
Item 17.
Undertakings.
Insofar as indemnification for liabilities arising under the
    Securities Act may be permitted to directors, officers and
    controlling persons of the Registrant pursuant to the foregoing
    provisions, or otherwise, 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
    Securities 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 whether such
    indemnification by it is against public policy as expressed in
    the Securities Act and will be governed by the final
    adjudication of such issue.
The undersigned Registrant hereby undertakes that:
(1) For purposes of determining any liability under the
    Securities Act, the information omitted from the form of
    prospectus filed as part of this Registration Statement in
    reliance upon Rule 430A and contained in a form of
    prospectus filed by the Registrant pursuant to
    Rule 424(b)(1) or (4) or 497(h) under the Securities
    Act shall be deemed to be part of this Registration Statement as
    of the time it was declared effective.
(2) For the purpose of determining any liability under the
    Securities Act, each post-effective amendment that contains a
    form of prospectus 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.
II-5
SIGNATURES
Pursuant to the requirements of the Securities Act, the
    Registrant has duly caused this Registration Statement to be
    signed on its behalf by the undersigned, thereunto duly
    authorized, in the City of Rockville, State of Maryland, on the
    16th day of April, 2010.
REGENERX BIOPHARMACEUTICALS, INC.
By:
/s/  J.J.
    Finkelstein
J.J. Finkelstein
President and Chief Executive Officer
KNOW ALL BY THESE PRESENTS, that each person whose signature
    appears below hereby constitutes and appoints J.J. Finkelstein
    and C. Neil Lyons, and each of them, his true and lawful agent,
    proxy and attorney-in-fact, with full power of substitution and
    resubstitution, for him and in his name, place and stead, in any
    and all capacities, to (i) act on, sign and file with the
    Securities and Exchange Commission any and all amendments
    (including post-effective amendments) to this registration
    statement together with all schedules and exhibits thereto and
    any subsequent registration statement filed pursuant to
    Rule 462(b) under the Securities Act of 1933, as amended,
    together with all schedules and exhibits thereto, (ii) act
    on, sign and file such certificates, instruments, agreements and
    other documents as may be necessary or appropriate in connection
    therewith, (iii) act on and file any supplement to any
    prospectus included in this registration statement or any such
    amendment or any subsequent registration statement filed
    pursuant to Rule 462(b) under the Securities Act of 1933,
    as amended, and (iv) take any and all actions which may be
    necessary or appropriate to be done, as fully for all intents
    and purposes as he might or could do in person, hereby
    approving, ratifying and confirming all that such agent, proxy
    and attorney-in-fact or any of his substitutes may lawfully do
    or cause to be done by virtue thereof.
Pursuant to the requirements of the Securities Act, this
    Registration Statement has been signed by the following persons
    in the capacities and on the dates indicated.
Signature
Title
Date
/s/  J.J.
    Finkelstein
J.J.
    Finkelstein
President and Chief Executive Officer and Director
(Principal
    Executive Officer)
April 16, 2010
/s/  C.
    Neil Lyons
C.
    Neil Lyons
Chief Financial Officer
(Principal Accounting and Financial Officer)
April 16, 2010
/s/  Allan
    L. Goldstein
Allan
    L. Goldstein
Chairman of the Board of Directors
April 16, 2010
/s/  Richard
    J. Hindin
Richard
    J. Hindin
Director
April 16, 2010
/s/  Joseph
    C. McNay
Joseph
    C. McNay
Director
April 16, 2010
/s/  Mauro
    Bove
Mauro
    Bove
Director
April 16, 2010
/s/  L.
    Thompson Bowles
L.
    Thompson Bowles
Director
April 16, 2010
II-6