<PAGE>   1
                                  Form 20 - F

[ ]  Registration statement pursuant to section 12(b) or (g) of the Securities
     Exchange Act of 1934 [Fee required]

                                       or

[X]  Annual report pursuant to section 13 or 15(d) of the Securities Exchange
     Act of 1934 [Fee required] - For the fiscal year ended December 31, 2000

                                       or

[ ]  Transition report pursuant to section 13 or 15(d) of the Securities
     Exchange Act of 1934 [No fee required] - For the transition period from
             to

                        Nymox Pharmaceutical Corporation
             (Exact name of registrant as specified in its charter)
                                     Canada

                (Jurisdiction of incorporation or organization)
                        9900 Cavendish Blvd., Suite 306
                      St. Laurent, Quebec, Canada, H4M 2V2

Securities registered or to be registered pursuant to section 12(b) of the Act.


Title of each class                    Name of each exchange on which registered
-------------------                    -----------------------------------------
       None                                          Not Applicable

 Securities registered or to be registered pursuant to section 12(g) of the Act
                                  Common Stock

 Securities registered or to be registered pursuant to section 15(d) of the Act
                                      None

Indicate the number of outstanding shares of each of the issuer's classes of
capital or common stock as of the close of the period covered by the annual
report: 21,377,621 shares as of December 31, 2000.

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such report(s)), and (2) has been subject to such filing
requirements for the past 90 days.

                 Yes [X]                                  No [ ]

     Indicate by check mark which financial statement item the registrant has
elected to follow.

               Item 17 [X]                             Item 18  [ ]


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<PAGE>   2

In this annual report, the term "Nymox" refers to both Nymox Pharmaceutical
Corporation and its subsidiaries, Nymox Corporation and Serex Inc., and, where
applicable, a predecessor private corporation, DMS Pharmaceuticals Inc.

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

You should be aware that this annual report contains forward-looking statements
about, among other things, the anticipated operations, product development,
financial condition and operating results of Nymox, proposed clinical trials and
proposed transactions, including collaboration agreements.

By forward-looking statements, we mean any statements that are not statements of
historical fact, including (but are not limited to) statements preceded by or
that include the words, "believes", "expects", "anticipates", "hopes", "targets"
or similar expressions.

In connection with the "safe harbor" provisions in the Private Securities
Litigation Reform Act of 1995, we are including this cautionary statement to
identify some of the important factors that could cause Nymox's actual results
or plans to differ materially from those projected in forward-looking statements
made by, or on behalf of, Nymox. These factors, many of which are beyond the
control of Nymox, include Nymox's ability to:

     -    identify and capitalize on possible collaboration, strategic
          partnering or divestiture opportunities,


     -    obtain suitable financing to support its operations and clinical
          trials,

     -    manage its growth and the commercialization of its products,

     -    achieve operating efficiencies as it progresses from a
          development-stage to a later-stage biotechnology company,

     -    successfully compete in its markets,

     -    realize the results it anticipates from the clinical trials of its
          products,

     -    succeed in finding and retaining joint venture and collaboration
          partners to assist it in the successful marketing, distribution and
          commercialization of its products,

     -    achieve regulatory clearances for its products,

     -    obtain on commercially reasonable terms adequate product liability
          insurance for its commercialized products,

     -    adequately protect its proprietary information and technology from
          competitors and avoid infringement of proprietary information and
          technology of its competitors,

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<PAGE>   3
     -    assure that its products, if successfully developed and commercialized
          following regulatory approval, are not rendered obsolete by products
          or technologies of competitors and

     -    not encounter problems with third parties, including key personnel,
          upon whom it is dependent.

Although Nymox believes that the forward-looking statements contained in this
annual report are reasonable, it cannot ensure that its expectations will be
met. These statements involve risks and uncertainties. Actual results may differ
materially from those expressed or implied in these statements. Factors that
could cause such differences include, but are not limited to, those discussed in
the section entitled "Risk Factors" in Item 3, Description of Business.

PART I

ITEM 1.  IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS

Not Applicable

ITEM 2.  OFFER STATISTICS AND EXPECTED TIMETABLE

Not Applicable

ITEM 3.  KEY INFORMATION

SELECTED FINANCIAL DATA

The following table sets forth selected consolidated financial data for Nymox
for the periods indicated, derived from financial statements prepared in
accordance with generally accepted accounting principles ("GAAP"). We prepare
our basic financial statements in accordance with Canadian GAAP and include, as
a note to the statements, a reconciliation of material differences to United
States GAAP. The financial statements have been audited by KPMG, LLP, Montreal,
Canada in the case of the years ended December 31, 1996,1997,1998,1999 and 2000.
The data set forth below should be read in conjunction with the Company's
financial statements and notes thereto and "Management's Discussion and Analysis
of Financial Conditions and Results of Operations" included elsewhere herein.


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<PAGE>   4

NYMOX PHARMACEUTICAL CORPORATION

Selected Consolidated Financial Data
(In U.S. dollars - Note 3)
<TABLE>
<CAPTION>
                                         Dec.31, 2000        Dec.31, 1999        Dec.31, 1998       Dec.31, 1997        Dec.31, 1996
                                         ------------        ------------        ------------       ------------        ------------
<S>                                        <C>                 <C>                 <C>                <C>                 <C>
CANADIAN GAAP

Current Assets                                749,510             776,824           2,708,543          1,750,388           2,006,675

Capital Assets                              3,546,616           1,168,316           1,279,692            983,484             913,166

Total Assets                                4,518,638           2,140,491           3,988,235          2,733,872           2,919,841

Total Liabilities                             323,774             833,344             301,004            202,543             266,214

Capital Stock                              23,243,941          16,912,963          15,943,710          9,597,888           6,445,431

Shareholders' Equity                        3,260,942           1,307,147           3,687,231          2,531,329           2,653,628

Revenues                                      225,867             190,203             273,565             70,055             157,237

Sales                                         157,688             153,252             104,804             17,033                 -0-

Research & Development
Expenditures (note 1)                       2,073,775           1,132,941           2,087,742          1,671,412           1,466,085

Net Loss                                    4,023,979           3,314,296           4,783,213          3,463,905           2,562,921

Loss per Share                                   0.19                0.17                0.25               0.19                0.15

Weighted Avg. No. of
Common Shares                              20,890,735          19,886,430          19,304,435         18,370,873          17,654,862

U.S. GAAP (note 2)

Net Loss                                    4,272,308           3,409,166           4,979,562          3,755,409           3,175,587

Loss per Share                                   0.20                0.17                0.26               0.20                0.18

Shareholders' Equity                        3,102,887           1,139,731           3,304,352          2,428,052           2,699,092
</TABLE>

Notes:
1)   We earn investment tax credits by making qualifying research and
     development expenditures. These amounts shown are net of investment tax
     credits.

2)   Reference is made to Note 10 of Nymox's audited financial statements as at
     and for the year ended December 31, 2000 for a reconciliation of
     differences between Canadian and U.S. GAAP.

3)   Effective January 1, 2000, the Corporation adopted the United States dollar
     as its measurement currency as a result of the increasing proportion of
     operating, financing and investing transactions in the Canadian operations
     that are denominated in U.S. dollars. For Canadian GAAP purposes, the
     financial information for all periods presented up to December 31, 1999 has
     been translated into U.S. dollars at the December 31, 1999 exchange rate,
     which was 1.4433 Canadian dollars to the U.S. dollar. For U.S. GAAP
     purposes, assets and liabilities for all years presented have been
     translated into U.S. dollars at the ending exchange rate for the respective
     year and the statement of earnings at the average rate for the respective
     year. Reference is made to notes 2(a) and 10 of the consolidated financial
     statements.

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<PAGE>   5



RISK FACTORS

The following risk factors apply to Nymox and our industry.

IT IS UNCERTAIN WHEN, IF EVER, WE WILL MAKE A PROFIT.

We first began operations in 1995 and are only in the early stages of commercial
marketing of our diagnostic test, the AlzheimAlert(TM) test. We have never made
a profit. We incurred a net loss of $4.8 million in 1998, $3.3 million in 1999
and $4.0 million in 2000. As of December 31, 2000, Nymox's accumulated deficit
was $19.9 million.

We cannot say when, if ever, Nymox will become profitable. Profitability will
depend on our uncertain ability to generate revenues from the sale of our
products and the licensing of our technology that will offset the significant
expenditures required for us to advance our research, protect and extend our
intellectual property and develop, manufacture, license, market, distribute and
sell our technology and products successfully. Similar types of expenditures in
the past have helped produce the net losses reported above.

WE MAY NOT BE ABLE TO RAISE ENOUGH CAPITAL TO DEVELOP AND MARKET OUR PRODUCTS.

Nymox has funded its operations primarily by selling shares of its common stock.
Since late 1998, a small portion of the funds came from service revenues.
However, service revenues have not been, and may not be in the foreseeable
future, sufficient to meet our anticipated financial requirements.

We will continue to need to raise substantial amounts of capital for our
business activities including our research and development programs, the conduct
of clinical trials needed to obtain regulatory approvals and the marketing and
sales of our products. Additional financing may not be available when needed,
or, if available, may not be available on acceptable terms. If adequate funds on
acceptable terms are not available, we may have to curtail or eliminate
expenditures for research and development, testing, clinical trials, promotion
and marketing for some or all of our products.

WE FACE CHALLENGES IN DEVELOPING AND IMPROVING OUR PRODUCTS.

The pharmaceutical and diagnostic industries are driven by rapid technological
and scientific developments and changing customer needs. Nymox's success
depends, in large part, on its ability to respond to our customers' requirements
in a timely manner by developing or acquiring rights to new products or
improvements to our existing products. We are still developing many of our
products and have not yet brought them to market. We cannot assure you that we
will be able to develop or acquire rights to such products and to market them
successfully.

WE FACE SIGNIFICANT AND GROWING COMPETITION.

Rapidly evolving technology and intense competition are the hallmarks of modern
pharmaceutical and biotechnology industries. Our competitors include:

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     -    major pharmaceutical, diagnostic, chemical and biotechnology
          companies, many of which have financial, technical and marketing
          resources significantly greater than ours;

     -    biotechnology companies, either alone or in collaborations with large,
          established pharmaceutical companies to support research, development
          and commercialization of products that may be competitive with ours;
          and

     -    academic institutions, government agencies and other public and
          private research organizations which are conducting research into
          Alzheimer's disease and which increasingly are patenting, licensing
          and commercializing their products either on their own or through
          joint ventures.

WE MAY NOT BE ABLE TO SUCCESSFULLY MARKET OUR PRODUCTS.

To increase our marketing, distribution and sales capabilities both in the
United States and around the world, we will need to enter into licensing
arrangements, contract sales agreements and co-marketing deals. We cannot assure
you that we will be able to enter into agreements with other companies on terms
acceptable to us, that any licensing arrangement will generate any revenue for
the company or that the costs of engaging and retaining the services of a
contract sales organization will not exceed the revenues generated.

OUR PRODUCTS AND SERVICES MAY NOT RECEIVE NECESSARY REGULATORY APPROVALS.

Our AlzheimAlert(TM) testing service and our products in development are subject
to a wide range of government regulation governing laboratory standards, product
safety and efficacy. The actual regulatory schemes in place vary from country to
country and regulatory compliance can take several years and involve substantial
expenditures.

We cannot be sure that we can obtain necessary regulatory approvals on a timely
basis, if at all, for our products in development and all of the following could
have a material adverse effect on our business:

     -    failure to obtain or significant delays in obtaining requisite
          approvals;

     -    loss of or changes to previously obtained approvals; and

     -    failure to comply with existing or future regulatory requirements.

The operation of our clinical reference laboratory in New Jersey is regulated by
the Health Care Financing Administration (HCFA) under the Clinical Laboratories
Improvement Act of 1988. In addition, individual states like New York and
Florida have their own requirements for reference laboratories like ours that
offer diagnostic services. In addition, the United States Food and Drug
Administration (FDA) has its own regulations governing in vitro diagnostic
products, including some of the reagents used in clinical reference
laboratories. Any changes in HCFA or state law requirements or in the FDA
regulations could have a detrimental impact on our ability to offer or


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<PAGE>   7
market any reference laboratory services and/or on our ability to obtain
reimbursement from the Medicare and Medicaid programs and providers.

We will require prior approval from the FDA before we can distribute and sell in
the United States an AlzheimAlert(TM) diagnostic kit, which permits the testing
of patient samples either in a general purpose laboratory or the physician's
office. Similar requirements exist in many other countries. In general, such
approval requires clinical testing as to the safety and efficacy of the device
and preparation of an approval application with extensive supporting
documentation. If approved, the device would then be subject to postmarketing
record and reporting obligations and manufacturing requirements. Obtaining these
approvals and complying with the subsequent regulatory requirements can be both
time-consuming and expensive.

In the United States, our drugs in development will require FDA approval, which
comes only at the end of a lengthy, expensive and often arduous two-step
process. We cannot predict with any certainty the amount of time the FDA will
take to approve one of our drugs or even whether any such approval will be
forthcoming. Similar requirements exist in many other countries.

PROTECTING OUR PATENTS AND PROPRIETARY INFORMATION IS COSTLY AND DIFFICULT.

We believe that patent and trade secret protection is important to our business,
and that our success will depend, in part, on our ability to obtain strong
patents, to maintain trade secret protection and to operate without infringing
the proprietary rights of others.

The commercial success of products incorporating our technologies may depend, in
part, upon our ability to obtain strong patent protection. We cannot assure you
that additional patents covering new products or improvements will be issued or
that any new or existing patents will be of commercial benefit or be valid and
enforceable if challenged.

CHANGING MARKET CONDITIONS.

The healthcare industry is in transition with a number of changes that affect
the market for therapeutic and diagnostic test products. Changes in the
healthcare delivery system have resulted in major consolidation among reference
laboratories and in the formation of multi-hospital alliances, reducing the
number of institutional customers for therapeutic and diagnostic test products.
There can be no assurance that Nymox will be able to enter into and/or sustain
contractual or other marketing or distribution arrangements on a satisfactory
commercial basis with these institutional customers.

HEALTH CARE PLANS MAY NOT COVER OR ADEQUATELY PAY FOR OUR PRODUCTS AND SERVICES.

Throughout the developed world, both public and private health care plans are
under considerable financial and political pressure to contain their costs. The
two principal methods of restricting expenditures on drugs and diagnostic
products and services are to deny coverage or, if coverage is granted, to limit
reimbursement. For single-payer government health care systems, a decision to
deny coverage or to severely restrict reimbursement for one of our products can
have an adverse effect on our business and revenues.

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<PAGE>   8
In the United States, where, to a significant degree, the patient population for
our products is elderly, Medicare and Medicaid are sources of reimbursement. In
general, any restriction on reimbursement, coverage or eligibility under either
program could adversely affect reimbursement to Nymox for products and services
provided to beneficiaries of the Medicare and/or Medicaid programs. Many elderly
people are covered by a variety of private health care organizations either
operating private health care plans or Medicare or Medicaid programs subject to
government regulation. These organizations are also under considerable financial
constraints and we may not be able to secure coverage or adequate reimbursement
from these organizations. Without coverage, we will have to look to the patients
themselves who may be unwilling or unable to pay for the product; in turn,
doctors may be reluctant to order or prescribe our products in the absence of
coverage of the product for the patient.

THE FUTURE SALE OF ELIGIBLE SHARES MAY DILUTE NYMOX'S STOCK PRICE.

The issuance of further shares and the eligibility of issued shares for sale
will dilute our common stock and may lower its share price. There are 21,739,317
common shares of Nymox currently issued and outstanding as of March 31, 2001,
including the 452,201 shares issued to date under the Share Purchase Agreement
entered into with Jaspas Investments Limited. All of these shares are eligible
for sale under Rule 144 or are otherwise freely tradable. Finally, 1,649,500
share options are outstanding, of which 1,418,167 are currently vested. The
great majority of these options expire in 6 to 10 years. These options have been
granted to employees, officers, directors and consultants of the company.
Moreover, Nymox may use its shares as currency in acquisitions.

WE FACE POTENTIAL LOSSES DUE TO FOREIGN CURRENCY EXCHANGE RISKS.

The Corporation incurs certain expenses, principally relating to salaries and
operating expenses at its Canadian head office, in Canadian dollars. All other
expenses are derived in US dollars. As a result, we are exposed to the risk of
losses due to fluctuations in the exchange rates between the United States
dollar and the Canadian dollar. We protect ourselves against this risk by
maintaining cash balances in both currencies. We do not currently engage in
hedging activities. We cannot say with any assurance that the company will not
suffer losses as a result of unfavorable fluctuations in the exchange rates
between the United States dollar and Canadian dollar.

WE HAVE NEVER PAID A DIVIDEND AND ARE UNLIKELY TO DO SO IN THE FORESEEABLE
FUTURE.

Nymox has never paid any dividends and does not expect to do so in the
foreseeable future. We expect to retain any earnings or positive cash flow in
order to finance and develop Nymox's business.


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<PAGE>   9



ITEM 4. INFORMATION ON THE COMPANY

HISTORY OF THE COMPANY

Nymox Pharmaceutical Corporation was incorporated in Canada under the Canada
Business Corporations Act in May, 1995 to acquire all of the common shares of
DMS Pharmaceutical Inc., a private company which had been carrying on research
and development since 1989 on diagnostics and drugs for brain disorders and
diseases of the aged with an emphasis on Alzheimer's disease. Nymox has two
United States subsidiaries; one wholly owned subsidiary named Nymox Corporation
and the other a 97% owned subsidiary named Serex, Inc, purchased in March, 2000.

Nymox's principal executive offices are located at:

     Nymox Pharmaceutical Corporation
         9900 Cavendish Boulevard, Suite 306
         St.-Laurent, Quebec, Canada, H4M 2V2
         Phone: (800) 936-9669
         Fax: (514) 332-2227

     Nymox Corporation
         230 West Passaic St.
         Maywood, NJ, USA 07607

     Serex, Inc.
         230 West Passaic St.
         Maywood, NJ, USA 07607

ACQUISITION OF A MAJORITY INTEREST IN SEREX, INC.

On March 2, 2000, we closed our acquisition of a majority interest in Serex,
Inc., a privately held diagnostic company that was founded by Dr. Judith
Fitzpatrick in 1983 and is based in Maywood, New Jersey.

We have subsequently acquired more shares of the common stock of Serex, Inc.
from other shareholders and now own approximately 97% of its common stock.

Serex assisted in the development of Nymox's AlzheimAlert(TM) test and the
patenting of some of the technology relating to AlzheimAlert(TM).

Serex also developed and patented its particle valence technology, a unique,
highly sensitive, new method to detect very small amounts of biochemical
indicators in body fluids such as blood, urine and saliva. Serex licensed the
Japanese rights to two of its principal patents to Mizuho Medy Co. Ltd. of
Japan.

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<PAGE>   10

Serex's diagnostic technology can be adapted to detect a wide range of
biochemical indicators for diseases, conditions and drug use.

Preliminary work at Serex has identified a wide range of potential applications
for its patented technology from detecting an early indicator of pregnancy, to
detecting a brain protein implicated in certain brain diseases, from detecting
indicators for heart disease, determining blood sugar levels in a type of
diabetes and to monitoring therapeutic drug levels.

Serex developed its NicAlert(TM) which can reliably detect one of the metabolic
products of nicotine in human urine and saliva, enabling it to determine whether
a person, such as a teenager or insurance applicant, is using a tobacco product.
NicAlert(TM) is currently being distributed in Japan by Mizuho Medy Co. Ltd. of
Japan and outside of Japan by Nymox and Jant Pharmacal Corporation.

In November, 1999, Serex was granted a United States patent for an antibody and
for the use of the antibody in its technology in order to detect one of the
biochemical indicators for the loss of bone matter, which is a sign of
osteoporosis, the most common bone disease in humans. Osteoporosis results from
the progressive loss of bone material and can cause disabling and potentially
life-threatening bone fractures in particular of the spine and the hips. It is
most common in the elderly and in post-menopausal women.

Serex has under development a test that can potentially detect biochemical
indicators of cholesterol in human saliva and therefore provide an inexpensive,
convenient and reliable method of determining and monitoring cholesterol levels.

Since 1996, Serex has collaborated with at least three major pharmaceutical
companies and two diagnostic companies under licensing and development
agreements concerning the development of some of these products. These
agreements contain confidentiality provisions that prohibit the disclosure of
their terms.

CAPITAL EXPENDITURES

For information concerning our capital expenditures and methods of financing,
please see Item 5 entitled "Operating and Financial Review and Prospects".

BUSINESS OVERVIEW

Nymox is a development stage biopharmaceutical company based in Maywood, New
Jersey and Saint Laurent, Quebec, Canada.

We specialize in the research and development of therapeutics and diagnostics
for the aging population with an emphasis on Alzheimer's disease. Alzheimer's
disease is a progressive, terminal brain disease of the elderly marked by an
irreversible decline in mental abilities, including memory and comprehension,
and often accompanied by changes in behavior and personality. It currently
afflicts an estimated four million people in the United States and at least 15
million people worldwide. As the baby-boomer generation continues to age, these
figures are expected to rise sharply.

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DIAGNOSTIC PRODUCTS FOR ALZHEIMER'S DISEASE

Alzheimer's disease is the most common cause of dementia in persons 65 years of
age and older and is the fourth leading cause of death among the elderly.
Despite the need for an accurate clinical test, the definitive diagnosis of the
disease is possible only after the death of the patient by expert, pathologic
examination of brain tissue.

The Surgeon General's Report on Mental Health, released on December 13, 1999,
identified the importance and the need for the early detection and diagnosis of
Alzheimer's disease. The report described the current approach to Alzheimer's
disease diagnosis, clinical examination and the exclusion of other common causes
of its symptoms, as time- and labor-intensive, costly and largely dependent on
the expertise of the examiner. As a result, the illness is currently
underrecognized, especially in primary care settings, where most older patients
seek care. The report joined other experts writing in the field in recognizing
the need for a better, more reliable method for diagnosing the disease in living
patients and in particular, the need of a simple, accurate and convenient test
that could detect a biochemical change early in patients with Alzheimer's
disease. We believe our AlzheimAlert(TM) provides such a test.

ALZHEIMALERT (TM)

We market a proprietary diagnostic test for Alzheimer's disease, known as the
AlzheimAlert(TM) Test, through our reference laboratory in Maywood, New Jersey.
AlzheimAlert(TM) is an improved version of our AD7C(TM) test, which has been on
the market since 1997. It is a urine test, where the patient provides a
first-morning urine sample for testing. The patient's doctor then forwards the
sample to our laboratory where our technical staff performs the test. We then
report the results to the doctor.

AlzheimAlert(TM) is the latest generation of our NTP testing technology. It
measures the level of a brain protein called neural thread protein (NTP) which
is elevated early in Alzheimer's disease as reported both in the scientific
literature and at scientific conferences. Researchers at the Massachusetts
General Hospital and Brown University led by Doctors Suzanne de la Monte and
Jack Wands first found large amounts of the protein in the brain tissue of
patients known to have died with Alzheimer's disease. Subsequent research led to
the characterization of NTP and the gene that produces it. Nymox succeeded in
developing a highly sensitive test to detect the presence of NTP in the spinal
fluid and, most recently, in the urine of patients with Alzheimer's disease. A
recent study (J. Neuropathol Exp Neurol (2001; 60: 195-207)) has provided
further evidence that increased production of NTP leads to a marked increase in
nerve cell death and shown that the cells subjected to the NTP died in a
programmed fashion similar to the way the nerve cells in the brains of patients
with Alzheimer's disease die. One of the characteristic signs of Alzheimer's
disease is widespread brain cell loss.

Nymox believes that its AlzheimAlert(TM) test can assist a physician faced with
the task of diagnosing whether a patient has Alzheimer's disease. In company
funded trials of its NTP testing technology to date, involving over 500 clinical
samples, the test results were positive for over 80% of the patients with
verified Alzheimer disease and negative in over 89% of subjects without the
disease (known as a low false positive rate). The low rate of positive results
for

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<PAGE>   12
patients without the disease is important for doctors investigating patients
with subtle or marginal symptoms of mental, emotional, cognitive, or behavioral
changes. If the doctor can rule out Alzheimer's with more assurance, a great
deal of patient and family anguish and anxiety will be avoided. A low test score
will help the doctor to be more certain that Alzheimer's disease is not the
cause of the patient's symptoms and to target the other, often reversible causes
of the patient's symptoms, such as depression.

Many studies published in scientific publications or presented at scientific
conferences over the past decade have confirmed the accuracy of NTP as a
biochemical marker for Alzheimer's disease. Some recent publications include,
for example, the Journal of Clinical Investigation (1997; 100: 3093-3104),
Journal of Contemporary Neurology (1998; art. 4a), Journal of Clinical
Laboratory Analysis (1998; 12: 285-288) and (1998; 12: 223-226), Alzheimer's
Reports (1999; 2: 327-332) and (2000; 3: 177-184), and Neurology (2000; 54:
1498-1504). Reports about this Nymox technology have also been featured in
prestigious trade and lay publications such as Clinica (Sept.25, 2000), Genetic
Engineering News (Oct.1, 2000), Clinical Laboratory News (Oct., 2000), and
Modern Maturity (Dec., 2000).

There can be no assurance that further studies will repeat the same level of
success experienced to date.

The early diagnosis of Alzheimer's disease is important to physicians, patients
and their families and enables them to make informed and early social, legal and
medical decisions about treatment and care. Early diagnosis of Alzheimer's
disease has become increasingly important with new improvements in drug
treatment and care. Even a modest delay in institutionalization can mean
substantial social and financial savings. Conversely, any testing procedure that
could rule out Alzheimer's disease would eliminate the tremendous uncertainty
and anxiety patients and their families otherwise face and would allow
physicians to focus on the other, often reversible, causes of cognitive changes.

Early diagnosis as facilitated by the AlzheimAlert(TM) test represents a
potentially large cost-savings in the form of a reduced number of office visits,
lab tests, scans and other procedures required by the traditional methods of
diagnosis.

The AlzheimAlert(TM) test is an aid to diagnosis, to be considered together with
patient history, physical examination and other relevant medical data. The test
does not replace a physician's diagnosis.

Subject to further laboratory and clinical validation and to any necessary
regulatory approvals, we intend to sell the AlzheimAlert(TM) test worldwide as a
kit for the testing of patient samples either in a general purpose medical
laboratory or in a physician's office. AlzheimAlert(TM) offers a more
technically advanced means to detect elevated levels of NTP in urine. It is a
completely new assay in the competitive affinity format and has significant
advantages of easy adaptability to systems and equipment present in all modern
clinical laboratories.

We expect that, if approved, an AlzheimAlert(TM) kit will increase the
availability and acceptance of our test while lowering its cost to the patient
or health care payer.

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<PAGE>   13
OTHER BIOCHEMICAL INDICATORS OF ALZHEIMER'S DISEASE

We hold exclusive patent rights to several other biochemical indicators for
Alzheimer's disease, including the brain protein, 35i9, which we believe is also
associated with Alzheimer's disease. We intend to use our extensive scientific,
medical and commercial experience and know-how in the field of Alzheimer's
disease in order to develop new diagnostic tests, methods and treatments for the
disease from these and other indicators.

DEVELOPMENT OF THERAPEUTIC PRODUCTS FOR ALZHEIMER'S DISEASE

At present, there is no cure for Alzheimer's disease. There are four drugs
approved by the FDA, tacrine (brand-name Cognex), donepezil HCI (brand-name
Aricept), rivastigmine (brand-name Exelon) and galantamine hydrobromide (brand
name Reminyl) for the treatment of Alzheimer's disease. However, at most these
drugs offer symptomatic relief for the loss of mental function associated with
the disease and possibly help to delay the illness- progression. There is no
consensus as to the cause of Alzheimer's disease or even whether it is one
disease or many.

There is an urgent need for an effective treatment for the illness, caused in
part by the rising health care, institutional and social costs for the treatment
and care of Alzheimer's disease sufferers. The Surgeon General's Report on
Mental Health released on December 13, 1999, put the direct health care costs
for the illness in the United States at almost $18 billion for 1996. In a 1998
statement to the House Appropriations Subcommittee, the Director of the National
Institute on Aging, Dr. Richard J. Hodes, estimated that the cost of care to
family, caregivers and society in general was as much as $100 billion per year.

These costs are expected to rise sharply as the baby boom generation ages and
more people become at risk for the disease. According to Dr. Hodes, the number
of Americans aged 65 or over, now some 34 million, is expected to more than
double by year 2030. Within this group, the population of persons over the age
of 85 is the fastest growing segment. As people live longer, they become more at
risk of developing Alzheimer's disease.

Nymox's research into drug treatments for Alzheimer's disease is aimed at
compounds that could arrest the progression of the disease and therefore are
targeted for long term use.

DRUGS TARGETING SPHERONS

We are a leader in research and development into drugs for the treatment of
Alzheimer's disease that target spherons. Nymox researchers believe that
spherons are the cause of senile plaques -- the characteristic lesion found
abundantly in the brains of patients with Alzheimer's disease and believed by
many researchers to play a pivotal role in the fatal illness. Spherons are tiny
balls of densely packed protein found in brain cells scattered throughout the
brains of all humans from age one. Nymox researchers have found that as humans
age the spherons grow up to a hundred times larger until they become too large
for the cells that hold them. Once released from the cells, the spherons burst
which the researchers believe creates the senile plaques and sets off a cascade
of cellular damage and biochemical changes pivotal to the symptoms and signs of
Alzheimer's disease.

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The substantial evidence linking spherons to senile plaques and Alzheimer's
disease has been published in journals such as the Journal of Alzheimer's
Disease, Drug News & Perspectives and Alzheimer Reports. There are 20 important
criteria of validity which have been set forth correlating the disappearance of
spherons in old age with the appearance of senile plaques and implicating
spherons as a major cause of Alzheimer's disease. In 2000, Nymox researchers
published important findings in Alzheimer Reports (2000; 3: 177-184) confirming
that spherons contain key proteins that are also known to be in senile plaques
and showing that, like senile plaques, spherons contain unusually old proteins
in terms of the human body's metabolism, with an average age of 20 to 40 years.

Nymox researchers believe that stopping or inhibiting the transformation of
spherons into senile plaques will help stop or slow the progress of this
illness. You should be aware that there is no consensus among researchers about
the causes or possible treatments of Alzheimer's disease and that other
researchers do not share this belief that spherons are the cause of Alzheimer's
disease or are a target for the development of treatments for the disease.

Based on these research findings and this approach to the treatment of the
disease, we developed novel, proprietary drug screening methods based on
spherons and used them to discover, develop and test drug candidates to inhibit
the formation of Alzheimer plaques from spherons. These candidates have the
potential to slow or stop the progression of the disease. We have two distinct
new drug candidates, NXD-3109 and NXD-1191, neither of which demonstrate
significant toxicity and both of which had positive animal testing results.

Such drug candidates will require regulatory approval in order to begin clinical
studies for humans. You should be aware there is no guarantee that any of these
drug candidates will ever be approved for marketing as a treatment for
Alzheimer's disease. Drug candidates that look promising in early studies in the
laboratory or with animals often prove on further testing to be unsafe,
ineffective or impractical to use with human patients. The cost of bringing a
drug candidate through the necessary clinical trial and regulatory approvals is
very high and will require us to seek substantial financing through various
sources including the issuing of more stock, the borrowing of funds secured by
financial instruments such as bonds or agreements with major pharmaceutical
companies. We risk not be able to secure such funding in the necessary amounts
or on sufficiently favorable terms.

Nymox holds global patent rights covering both methods for using spherons as
targets for developing drugs and for the actual drug candidates discovered.

NEURAL THREAD PROTEIN BASED DRUGS

Nymox also developed a unique drug screening system, based on the research that
led to its AlzheimAlert(TM) test, to identify other potential drug candidates
for the treatment of Alzheimer's disease. There is a substantial body of
evidence showing that NTP may play a key role in Alzheimer's disease. The most
recent study was published in the Journal of Neuropathology and Experimental
Neurology (60: 195-207) by Dr. Suzanne de la Monte and Dr. Jack Wands of Brown
University. In the experiment, Dr. de la Monte and Dr. Wands implanted the gene
that produces NTP in nerve cells derived from humans. They then caused the cells
to turn on the implanted NTP gene and to begin to produce NTP in elevated
quantities. This caused a marked

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<PAGE>   15
increase in nerve cell death. Sophisticated analysis showed that the cells died
in a programmed fashion similar to the way the nerve cells in brains of patients
with Alzheimer's disease die. Extensive loss of brain cells and accompanying
brain shrinkage is a key part of the Alzheimer's disease process. Nymox screened
compounds for their ability to impede this process of premature cell death and
thus potentially help slow or halt the loss of brain cells in the Alzheimer's
disease brain. Nymox licensed this technology in 1997 from the Massachusetts
General Hospital as part of a sponsored research and licensing agreement.

STATIN DRUGS AS A POSSIBLE PREVENTIVE TREATMENT FOR ALZHEIMER'S DISEASE

In November, 1999, Dr. Ben Wolozin of Loyola University Medical Center in
Chicago reported at the annual meeting of the Society for Neuroscience his
findings that some members of a class of anti-cholesterol drugs called statins
may delay or prevent the onset of Alzheimer's disease. Dr. Wolozin licensed the
commercial and patent rights to this discovery to Nymox. He and his fellow
researchers subsequently published their findings in the Archives of Neurology
(2000:1439-43).

NEW ANTIBACTERIAL AGENTS AGAINST INFECTIONS AND FOOD CONTAMINATION

Outside of the area of the treatment and diagnosis of Alzheimer's disease, we
are developing a new class of antibacterial agents for the treatment of urinary
tract and other bacterial infections in humans which have proved highly
resistant to conventional antibiotic treatments and for the treatment of E. coli
0157:H7 bacterial contamination in hamburger meat and other food and drink
products.

In the last ten years there has been a growing recognition of the increasing
problem of antibiotic-resistant infections and the need for truly novel
antibacterial drugs. See, for example, the European Commission report dated May
28, 1999, "Opinion of the Scientific Steering Committee on Antimicrobial
Resistance" and the report from the Interagency Task Force on Antimicrobial
Resistance, co-chaired by the Centers for Disease Control and Prevention, the
U.S. Food and Drug Administration and the National Institutes of Health,
entitled A Public Health Action Plan to Combat Antimicrobial Resistance released
on January 19, 2001.

In the field of infectious disease treatments, Nymox has developed three new
antibacterial agents:

     -    NXB-4221 for the treatment of difficult chronic and persistent urinary
          tract infections;

     -    NXB-5886 for the treatment of streptococcal infection; and

     -    NXT-1021 for the treatment of staphylococcal infection.

Urinary tract infections in women caused by bacteria such as E. coli have become
increasingly resistant to conventional antibiotic treatment. Some varieties of
streptococcus and staphylococcus bacteria, a common source of infection in
humans, have acquired a broad immunity to antibiotic treatments. Infections from
these antibiotic resistant bacteria are difficult to


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<PAGE>   16
treat and can be life threatening. Nymox's three antibacterial agents have all
shown the ability to kill their bacterial targets in culture with no signs of
toxicity.

E. coli contamination of food and drink is a serious public health problem
worldwide and a major concern for meat processors in particular. E. coli
bacteria occur normally and usually harmlessly in the gastrointestinal tracts of
humans, cows and other animals. However, one mutant variety of the E. coli
bacteria, E. coli 0157:H7, can cause life-threatening illness and has been
implicated in cases of severe diarrhea, intestinal bleeding and kidney failure,
leading, in some cases, to death in children and the elderly. E. coli
contamination in hamburger meat and other food products and in drinking water
affects about 100,000 people a year.

There is a well-recognized need in the beef industry to address the problem of
E. coli contamination in meat processing and in livestock. E. coli contamination
has triggered massive recalls of ground beef both in the U.S. and in Canada.
Cattle are a natural reservoir for the deadly strain of E. coli. Water
contamination from cattle operations have led to such public health tragedies
such as occurred in Walkerton, Ontario where seven people died and 2,300 became
ill as a result of such contamination.

Nymox developed a potent new antibacterial agent, NXC-4720. Tests of NXC-4720
show it to be highly effective against all known substrains of E. coli 0157:H7,
the bacteria implicated in these severe cases of food and drink contamination.
Tests of NXC-4720 show that it destroys E. coli 0157 strains, including H7,
efficiently, rapidly and at a very low dose. In 1999, we began further trials
for this agent and are continuing trials with various collaborators, including
the Faculty of Veterinary Medicine at the University of Montreal, the Department
of Food Science at the University of Manitoba and BioPhage Inc. Nymox has patent
rights to these and other antibacterial agents.

PROPERTY, PLANTS AND EQUIPMENT

Nymox and Serex laboratory facilities in Maywood, New Jersey comprise 4,687
square feet of leased space. That lease agreement expires February 28, 2005.
Nymox office and research facilities in St. Laurent, Quebec, Canada comprise
6,923 square feet of leased space. The lease agreement expires on August 31,
2003. Nymox Pharmaceutical Corp. and its two US subsidiaries Nymox Corp. and
Serex, Inc. own a full complement of equipment used in all aspects of their
research and development work and the Nymox reference laboratory. Nymox believes
that its facilities are adequate for its current needs and that additional
space, if required, would be available on commercially reasonable terms.

GOVERNMENTAL REGULATION

Our AlzheimAlert(TM) test which we provide as a service through our clinical
reference laboratory in Maywood, New Jersey is subject to extensive government
regulation in the United States. Our clinical reference laboratory and its
performance of the AlzheimAlert(TM) must be certified by the Health Care
Financing Administration (HCFA) under the Clinical Laboratories Improvement Act
of 1988 (CLIA), which establishes quality standards for the laboratory tests
being performed to ensure the accuracy, reliability and timeliness of patient
test results. In

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<PAGE>   17
addition, some individual states such as New York State have their own
requirements for the inspection and certification of reference laboratories
which offer diagnostic services for patients within the state. Finally, the FDA
has its own regulations governing in vitro diagnostic products, including
analyte-specific reagents used in clinical reference laboratories. Any changes
in our current certification status, HCFA or state law requirements or in the
FDA regulations could have an impact on our ability to offer or market any
reference laboratory services and/or on our ability to obtain reimbursement from
the Medicare and Medicaid programs and providers.

We plan to seek FDA approval for the marketing, distribution and sale of our
AlzheimAlert(TM) test, outside of the clinical reference laboratory setting in
the United States. Such approval for this type of commercial development is
necessary for all in vitro diagnostic devices like our AlzheimAlert(TM) test.

The regulatory process leading to such approval can be time-consuming and
expensive and can result in an outright denial or a very limited approval only.
Our product will be subject to subject to premarketing and postmarketing
requirements applicable to such devices, including those governing:

     i)    clinical testing;

     ii)   design control procedures;

     iii)  prior FDA approval of a 510(k) application, where the FDA has
           determined that our diagnostic device is substantial equivalent to a
           marketed device, or a premarket approval application, where the FDA
           has been satisfied with clinical studies demonstrating the safety and
           efficacy of our device;

     iv)   postmarketing record and reporting obligations; and

     v)    good manufacturing practices.

The requirements for a premarket approval application are analogous to those for
the approval of a new drug and include four categories of information:
indications for use, device description and manufacturing methods, alternative
practices and procedures for the diagnosis of the disease and clinical and
nonclinical studies. The requirements for a 510(k) application are generally
less onerous but still include indications for use, safety and effectiveness
data as well as manufacturing and quality assurance data and information. There
can be no assurance that the AlzheimAlert(TM) test or any other medical device
that we may develop in the future will obtain the necessary approvals within a
specified time framework, if ever. In addition, the FDA may impose certain
postmarketing requirements that may significantly increase the regulatory costs
associated with our product. The FDA has recourse to a wide range of
administrative sanctions and civil and criminal penalties in order to enforce
the applicable laws, rules and regulations.

Our therapeutic products under development by Nymox would also have to receive
regulatory approval. This is a costly, lengthy and risky process. In the United
States, in order for a product to be marketed, it must go through four distinct
development and evaluation stages:


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<PAGE>   18


     Product Evaluation.

     We must conduct preliminary studies of potential drug candidates using
     various screening methods to evaluate them for further testing, development
     and marketing.

     Optimization of Product Formulation.

     The activities in this stage of development involve consultations between
     us and investigators and scientific personnel. Preliminary selection of
     screening candidates to become product candidates for further development
     and further evaluation of drug efficacy is based on a panel of research
     based biochemical measurements. Extensive formulation work and in vitro
     testing are conducted for each of various selected screening candidates
     and/or product candidates.

     Clinical Screening and Evaluation.

     During this phase of development, portions of which may overlap with
     product evaluation and optimization of product formulation, initial
     clinical screening of product candidates is undertaken and full scale
     clinical trials commence. The FDA must approve any clinical testing on
     healthy subjects (Phase 1) and on patients (Phase 2 and 3).

     Final Product Development.

     The activities to be undertaken in final product development include
     performing final clinical evaluations, conducting large-scale experiments
     to confirm the reproducibility of clinical responses, making clinical lots
     for any additional extensive clinical testing that may be required,
     performing any further safety studies required by the FDA, carrying out
     process development work to allow pilot scale production of the product,
     completing production demonstration runs for each potential product, filing
     new drug applications, product license applications, investigational device
     exemptions (and any necessary supplements or amendments) and undergoing
     comprehensive regulatory approval programs and processes.

We cannot assure you that we will successfully complete the development and
commercialization of any therapeutic products.

In the United States, obtaining the necessary FDA approval for any drug is a
lengthy, expensive and often arduous process. We cannot predict with any
certainty the amount of time the FDA will take to approve one of our drugs or
even whether any such approval will be forthcoming. Similar requirements exist
in many other countries.

In the United States, the FDA approval procedure is a two-step process. We must
file an investigational new drug application for each product with the FDA
before beginning the initial (Phase I) clinical testing of the new drug in
healthy subjects. If the FDA has not commented on or questioned the application
within 30 days of its filing, initial clinical studies may begin. If, however,
the FDA has comments or questions, the questions must be answered to the
satisfaction of the FDA before initial clinical testing can begin. In some
instances, this process could result

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<PAGE>   19

in substantial delay and expense. Phase I studies are intended to demonstrate
the functional characteristics and safety of a product.

After Phase I testing, we must conduct extensive clinical trials with patients
in order to establish the efficacy and safety of our drug. Once we complete the
required clinical testing, we expect to have to file a new drug application for
FDA approval in order to market most, if not all, of our new drugs. The
application is complicated and detailed and must include the results of
extensive clinical and other testing, the cost of which is substantial. The FDA
conducts an extensive and often lengthy review of such applications. The agency
is required to review applications within 180 days of their filing, but, during
the review, frequently requests that additional information be submitted. This
starts the 180-day regulatory review period anew when the requested additional
information is submitted and, as a result, can significantly extend the review
period. Until the FDA actually approves the new drug application, there can be
no assurance that the agency will consider the information requested and
submitted to justify approval. The packaging and labeling of products are also
subject to FDA regulation. Accordingly, it is impossible to anticipate when the
FDA will approve a new drug application.

We must also obtain approval for our drugs or diagnostic devices from the
comparable regulatory authority in other countries before we can begin marketing
our product in that country. The approval procedure varies from country to
country and can involve additional testing. The time required may differ from
that required for FDA approval. Although there are some procedures for unified
filings for certain European countries, in general each country has its own
procedures and requirements, many of which are time-consuming and expensive.
Thus, there can be substantial delays in obtaining required approvals from both
the FDA and foreign regulatory authorities after the relevant applications are
filed.

After such approvals are obtained, further delays may be encountered before the
products become commercially available. If, subsequent to approval, new
information becomes available concerning the safety or effectiveness of any
approved product, the regulatory authority may require the labeling for the
affected product to be revised or the product to be withdrawn. Our manufacturing
of any approved drug must conform with the FDA's good manufacturing practice
regulations which govern the production of pharmaceutical products and be
subject to inspections and compliance orders.

Government regulation also affects our ability to receive an appropriate level
of reimbursement for our products. Throughout the developed world, both public
and private health care plans are under considerable financial and political
pressure to contain their costs. The two principal methods of restricting
expenditures on drugs and diagnostic products and services are to deny coverage
or, if coverage is granted, to limit reimbursement. For single-payer government
health care systems, a decision to deny coverage or to severely restrict
reimbursement for one of our products can have an adverse effect on our business
and revenues.

In the United States, where, to a significant degree, the patient population for
our products is elderly, Medicare and Medicaid are sources of reimbursement. In
general, any restriction on reimbursement, coverage or eligibility under either
program could adversely affect reimbursement to Nymox for products and services
provided to beneficiaries of the Medicare and/or Medicaid programs. Many elderly
people are covered by a variety of private health care organizations either
operating private health care plans or Medicare or Medicaid programs

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subject to government regulation. These organizations are also under
considerable financial constraints and we may not be able to secure coverage or
adequate reimbursement from these organizations. Without coverage, we will have
to look to the patients themselves who may be unwilling or unable to pay for the
product; in turn, doctors may be reluctant to order or prescribe our products in
the absence of coverage of the product for the patient.

In response to rising health care costs, the U.S. Congress implemented sweeping
changes to the U.S. Medicare and Medicaid systems in the Balanced Budget Act of
1997 and is currently considering a number of other proposals that could
significantly impact on the level of funding for Medicare and Medicaid programs.
Under the new Part C: Medicare + Choice programs, beneficiaries can now opt for
a variety of health delivery models, including coordinated care plans, HMOs,
preferred provider organizations and provider sponsored organizations, private
fee-for-service plans and medical savings account plans. In addition, states now
have the option to require Medicaid recipients to enroll with managed health
care plans without first obtaining a waiver, making it substantially easier for
the states to meet their Medicaid obligations through private managed care
organizations. All these health care delivery systems, including the original
Medicare and Medicaid systems, are subject to funding formulas and spending caps
and may compensate for these restrictions by limiting coverage, eligibility
and/or payments. The long-term impact of these legislative changes in terms of
their efficiency, effectiveness and financial viability in delivering health
care services to an aging population is uncertain at present. Any legislative or
regulatory actions to reduce or contain federal spending under either the
Medicare or Medicaid programs could adversely affect our ability to participate
in either program as a provider or supplier of services or products and the
amount of reimbursement under these programs potentially available to us.

Our AlzheimAlert(TM) test, and any of the new diagnostic and therapeutic
products and services that we may develop, will be subject to coverage
determinations by health care providers and payers. Federal and state
regulations and law and internal coverage policies of health care organizations
affect our ability to obtain payments for our products and services. The
Medicare program will not pay for any expenses incurred for items or services
that are not reasonable and necessary for the diagnosis or treatment of illness
or injury or to improve the functioning of a malformed body member.
Historically, HCFA interpreted this provision in order to exclude from Medicare
coverage those medical and health care services that are not demonstrated to be
safe and effective by acceptable clinical evidence. HCFA recently revised both
its national coverage policies and procedures in general and specifically its
coverage of diagnostic laboratory tests and constituted a Medicare Coverage
Advisory Committee to provide advice on the effectiveness and appropriateness of
medical items and services that are eligible for coverage under Medicare. It is
unknown how these changes will affect our ability to obtain Medicare coverage
for its products and services. However, an adverse national coverage decision
with respect to one of our products or services will make it impossible to
receive reimbursement from Medicare for that product and more difficult to
convince private health care organizations to provide coverage for it. Even if
we receive a favorable coverage decision for one of our products or services,
there is no guarantee that the level of reimbursement for it will be close to
our retail price for it or commensurate with the costs of developing and
marketing it.

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PATENTS AND PROPRIETARY INFORMATION

We believe that patent and trade secret protection is important to our business,
and that our success will depend, in part, on our ability to obtain strong
patents, to maintain trade secret protection and to operate without infringing
the proprietary rights of others.

The commercial success of products incorporating our technologies may depend, in
part, upon our ability to obtain strong patent protection. We cannot assure you
that additional patents covering new products or improvements will be issued or
that any new or existing patents will be of commercial benefit or be valid and
enforceable if challenged.

We pursue a policy of seeking patent protection for valuable patentable subject
matter of our proprietary technology and require all employees, consultants and
other persons who may have access to its proprietary technology to sign
confidentiality agreements.

Nymox has patents issued and allowed and patent applications pending in the
United States and selected countries including Canada, most European countries,
Australia and Japan. These patents and patent application cover much of our
current product development and technologies, including:

     -   new drug candidates for the treatment of Alzheimer's disease;

     -   proprietary screening technologies for finding therapeutic drugs for
         Alzheimer's disease. These screening technologies consist of biological
         systems and defined conditions used to determine if a drug candidate
         possesses a useful action that can predict its potential for use in
         humans or animals. For example, Nymox patented screening methods that
         show whether a potential drug can inhibit or arrest some of the
         pathological changes of Alzheimer's disease. As a second example, Nymox
         patented screening methods that show whether a potential drug can
         modify in a useful way the amounts of chemical markers of Alzheimer's
         disease in a subject. While no proven therapeutic drugs for AD have yet
         been found using these screening technologies, they are a useful
         component to our drug development program. (See "Development of
         Therapeutic Products for Alzheimer's Disease" above.)

     -   unique proteins which are related to Alzheimer's disease and which may,
         after further research and clinical trials, prove useful in either
         diagnostic or therapeutic applications;

     -   promising diagnostic markers for Alzheimer's disease;

     -   new diagnostic assay methods;

     -   methods of treating meat and other food products for E. coli
         contamination; and

     -   anti-infective agents.

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Nymox has nine patents in the United States and a corresponding larger number of
patents worldwide relating to the inventions and discoveries in those patents.

Nymox also has an exclusive license to a family of patents from the
Massachusetts General Hospital covering rights to the NTP diagnostic and
therapeutic products, including AlzheimAlert(TM). Under this license, the
Massachusetts General Hospital is entitled to royalties of 4% from worldwide
sales of the AlzheimAlert(TM) test. The earliest of these patents expires in the
year 2013. Nymox also has a similar research and license agreement with Rhode
Island Hospital, where the principal researchers, Dr. Suzanne de la Monte and
Dr. Jack Wands, now conduct their research into NTP, the brain protein detected
by our AlzheimAlert(TM) test, covering new developments and discoveries in this
area not otherwise covered by the Massachusetts General Hospital agreement.

Nymox's affiliate, Serex, Inc., in which it recently acquired a controlling
interest, also actively pursues a policy of seeking patent protection for its
patentable technologies and discoveries in the United States and in selected
other countries including some European countries, Canada, Australia and Japan.
Its patents issued and allowed and patent applications pending cover such areas
of its technologies and discoveries as:

     -    its particle valence technology which can detect very small amounts of
          biochemical indicators for diseases, conditions and drug use in body
          fluids such as blood, urine and saliva.

     -    a test that can detect biochemical indicators of cholesterol in human
          saliva and therefore provide a method of determining and monitoring
          cholesterol levels; and

     -    an antibody, which, used in Serex's proprietary technology, can detect
          one of the biochemical indicators for the loss of bone matter, which
          is a sign of osteoporosis, the most common bone disease in man.

Many companies have patents covering various drugs, methods and discoveries in
the fields of diagnostics and therapeutics for Alzheimer's disease and related
conditions and of new anti-infective agents. We believe that the patents issued
to date will not preclude Nymox from developing and marketing our products;
however, it is impossible to predict the extent to which licenses from third
parties will be necessary. If Nymox were to need licenses from third parties
there can be no assurance that we could obtain such licenses on commercially
reasonable terms, if at all.

In the fields of diagnostic methods and diagnostic tests for common human
diseases and conditions, where Serex has many of its patents, there are many
patents issued covering many areas of diagnostic methods, tests and
technologies. We believe that these patents issued to date to other companies
will not preclude Serex from developing and marketing its products but you
should be aware that it is often difficult to determine the nature, breadth and
validity of competing patent claims in these fields, that there has been
significant litigation in some of these areas (not involving Serex) and that, if
and when Serex's products become more commercially successful, Serex's products
or patents may become the subject matter of litigation. If Serex

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were to need licenses from third parties there can be no assurance that it
could obtain such license on commercially reasonable terms, if at all.

Neither Nymox nor Serex are currently involved in litigation over patent and
other intellectual property rights but significant litigation over these matters
in the pharmaceutical and biotechnology industry is not uncommon. The validity
and extent of patent rights can be very difficult to determine and involve
complex legal, factual and scientific questions. Important legal issues about
patent protection in the field of biotechnology have not been resolved. Patent
litigation is costly and time-consuming and can consume substantial resources.
An adverse decision can preclude the marketing of a product, expose us to
significant liabilities or require us to obtain third party licenses which may
not be available at commercially reasonable prices.

We also rely upon trade secrets, know-how, and continuing technological
advancement to develop and maintain our competitive position. We control the
disclosure and use of our know-how and confidential information through
agreements with the parties involved. In addition, we have confidentiality
agreements with our key employees, consultants, officers and directors. There
can be no assurance, however, that all confidentiality agreements will be
honored, that others will not independently develop equivalent technology, that
disputes will not arise as to the ownership of intellectual property, or that
disclosure of our trade secrets will not occur. Furthermore, there can be no
assurance that others have not obtained or will not obtain patent protection
that will exclude us from using our trade secrets and confidential information.
To the extent that consultants or research collaborators use intellectual
property owned by others in their work with us, disputes may also arise as to
the rights to related or resulting know-how or inventions.

COMPETITION

Rapidly evolving technology and intense competition are the hallmarks of modern
pharmaceutical and biotechnology industries. Our competitors include:

     -    major pharmaceutical, diagnostic, chemical and biotechnology
          companies, many of which have financial, technical and marketing
          resources significantly greater than ours;

     -    biotechnology companies, either alone or in collaborations with large,
          established pharmaceutical companies to support research, development
          and commercialization of products that may be competitive with ours;
          and

     -    academic institutions, government agencies and other public and
          private research organizations which are conducting research into
          Alzheimer's disease and which increasingly are patenting, licensing
          and commercializing their products either on their own or through
          joint ventures.

In the field of Alzheimer's disease diagnosis, our AlzheimAlert(TM) test faces
growing competition which could detrimentally impact on our ability to
successfully market and sell our diagnostic test. Our competitors include:

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     -    Athena Diagnostics, Inc. which is currently marketing three tests
          claimed to aid in the diagnosis of Alzheimer's disease: a genetic test
          for the rare cases of familial, early-onset Alzheimer's disease; a
          genetic test for a relatively common mutation of a gene said to
          increase the likelihood of a person with at least one of the genes
          contracting the disease; and a test for two proteins in the spinal
          fluid of patients.

     -    Mitokor, Inc. which developed a blood test known as Mito-Load that
          looks for certain mutations in mitochondrial DNA said to be associated
          with Alzheimer's disease. Mitokor recently entered into a
          non-exclusive licensing agreement in Japan for the marketing and sale
          of its product there.

     -    Synapse Technologies, Inc. which developed a blood test known as p97
          Diagnostic that detects a protein said to be diagnostic of Alzheimer's
          disease. Synapse Technologies also licensed its technology for use in
          Japan.

     -    NeuroLogic, Inc., which announced in September, 1999 that it acquired
          an exclusive world-wide license to a cellular test for Alzheimer's
          disease.

     -    Axonyx Inc., which announced in July, 2000 findings that two enzymes
          to which it had acquired world-wide exclusive rights,
          butrylcholinesterase and acetylcholinesterase, were elevated in the
          cerebrospinal fluid of patients with Alzheimer's disease.

There are also a number of other proposed biochemical signs of the disease that
could potentially be developed into a commercial diagnostic test as well as
various scanning and imaging technologies which might compete some day for a
portion of the diagnostic market for Alzheimer's disease.

We also face intense competition for the development of an effective treatment
for Alzheimer's disease. The market conditions for an Alzheimer's disease drug
strongly favor the entry of other corporations into the area. The current market
for therapeutic drugs for Alzheimer's disease is an estimated $2 billion. This
market is expected to grow rapidly as new drugs enter the market and as the baby
boom generation becomes more at risk for developing Alzheimer's disease. As a
result, most of the major pharmaceutical companies and many biotechnology
companies have ongoing research and development programs for drugs and
treatments for Alzheimer's disease. Many of these companies have much greater
scientific, financial and marketing resources than we have and may succeed in
developing and introducing effective treatments for Alzheimer's disease before
we can. At present, only one drug for Alzheimer's disease is being widely
marketed in the United States, Aricept by Pfizer. Aricept only treats some of
the symptoms of Alzheimer's disease by enhancing memory and other mental
functions and not the underlying causes of the illness.

A similar competitive reality prevails in the field of novel anti-infectives.
Over the past ten years, there has been an increasing awareness of the medical
need and of emerging market opportunities for new treatments for antibiotic
resistant bacterial infections. Many of the major pharmaceutical companies are
developing anti-infective drugs that either modify their existing drugs or
involve new anti-bacterial properties. Many biotechnology companies are
developing new classes of anti-bacterial drugs. At least three major
pharmaceutical companies have

                                       24
<PAGE>   25
vaccines against bacterial infections in development. To the extent that these
companies are able to develop drugs or vaccines that offer treatment for some or
all of the indications for our anti-infectives, the market for our products may
be adversely affected.

The problem of E. coli 0157:H7 contamination of hamburger meat and other food
products is also well-known and a number of companies and researchers have been
pursuing various potential solutions, including irradiation with x-rays, better
detection of contamination, electronic pasteurization, vaccination and
competitive exclusion of the pathogenic E. coli bacteria by harmless bacteria.
The development of alternative solutions to the problem of E. coli infection may
adversely affect the market for our treatment for E. coli 0157:H7 infection in
cattle and contamination of food products.

MARKETING

We currently market our AlzheimAlert(TM) test as a clinical reference laboratory
service primarily in the United States. We are also marketing the Serex
NicAlert(TM) test, which can determine whether a person is using tobacco
products, in the United States through our own marketing arm and through a
distribution agreement with Jant Pharmacal Corporation and in Japan with Mizuho
Medy Co. Ltd. of Japan. We have not started to commercially market or distribute
any of our other products under development and most of them will require
regulatory approval in each country before being marketed there.

At present, we have a network of over 40 independent medical representatives and
do most of our marketing ourselves. To increase our marketing, distribution and
sales capabilities both in the United States and around the world, we will need
to enter into licensing arrangements, contract sales agreements and co-marketing
deals. We cannot assure you that we will be able to enter into agreements with
other companies on terms acceptable to us, that any licensing arrangement will
generate any revenue for the company or that the costs of engaging and retaining
the services of a contract sales organization will not exceed the revenues
generated.

If successfully developed and approved, we plan to market and sell our
therapeutic and diagnostic products directly or through co-promotion
arrangements or other licensing arrangements with third parties. In cases where
we have sole or shared marketing rights, we plan to build a small, focused sales
force if and when such products approach marketing approval in some markets,
including Europe. Implementation of this strategy will depend on many factors,
including the market potential of any products we develop as well as on our
financial resources. To the extent we will enter into co-promotion or other
licensing arrangements, any revenues received by us will be dependent on the
efforts of third parties.

ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS

GENERAL

We are a development stage biopharmaceutical company that specializes in the
research and development of therapeutics and diagnostics for the aging
population with an emphasis on Alzheimer's disease.

                                       25
<PAGE>   26

We have begun to market the AlzheimAlert(TM) test, which we provide in our
clinical reference laboratory, that is an aid to the diagnosis of Alzheimer's
disease.

We also have under development therapeutic agents for the treatment of
Alzheimer's disease and of certain antibiotic-resistant infections as well as
antibacterial agents for E. coli contamination of food and drink products.

We also recently acquired a majority interest in Serex, Inc., a New Jersey
company specializing in diagnostic products.

AlzheimAlert(TM) is an improved version of our AD7C(TM) test, from which we
began generating revenue from sales in 1997.

All figures are presented in U.S. dollars, unless otherwise stated.

LIQUIDITY AND CAPITAL RESOURCES

We fund our operations and projects primarily by selling shares of Nymox's
common stock. However, since 1997, a small portion of our funding came from
service revenues. This source of funding became more significant in late 1998,
following the launch of our urinary version of the AD7C(TM) test. Since its
incorporation in May, 1995, Nymox raised the capital necessary to fund its
on-going research and development work and its marketing and sales operations
primarily through private placements of its shares.

On December 1, 1997, the shares began trading on the Nasdaq Stock Market.
Nymox's common shares also traded on the Montreal Exchange from December 18,
1995 to November 19,1999.

Private placements completed by Nymox since December, 1995 are as follows:

     -    December 1995, 1,578,635 common shares at a price of CAN$2.00
          (US$1.38) per share for total proceeds of CAN$3,157,270
          (US$2,187,536);

     -    April 1996, 877,300 common shares at a price of CAN$6.00 (US$4.15) per
          share for total proceeds of CAN$5,263,800 (US$3,647,059);

     -    May 1997, 696,491 common shares at a price of CAN$6.50 (US$4.50) and
          warrants exercisable at a price of CAN$8.50 (US$5.88) per share for
          total proceeds of CAN$4,527,191 (US$3,136,694). In 1998, all 696,491
          of these warrants were exercised for additional proceeds to Nymox of
          CAN$5,920,174 (US$4,101,832);

     -    May 1998, 231,630 common shares at a price of CAN$8.50 (US$5.88) for
          total proceeds of CAN$1,968,855 (US$1,364,134). A total of 110,000
          warrants were issued as well, exercisable at a price of CAN$8.50
          (US$5.88) per share (50,000) and CAN$10.00 (US$6.93) per share
          (60,000). These warrants have since expired;

                                       26
<PAGE>   27
     -    December 1998, 135,000 common shares and January 1999, 55,000 common
          shares at CAN$8.50 (US$5.88) per share, for total proceeds of
          CAN$1,615,000 (US$1,118,963). A total of 95,000 warrants were issued
          as well, exercisable at the price of CAN$10.00 (US$6.93) per share.
          These warrants have since expired;

     -    September 1999, 122,000 common shares at CAN$5.00 (US$3.46) per share,
          for total proceeds of CAN$610,000 (US$422,642).

     -    March 2000, 821,637 common shares at an average price of $4.87 per
          share, for total proceeds of $4,000,000. A total of 93,334 warrants
          were issued as well, exercisable at a price of $9.375 per share
          (66,667) and $7.8125 per share (26,667). These warrants expire on
          March 6, 2004.

     -    March, 2001, 200,000 common shares at $2.06 per share, for total
          proceeds of $412,000. A total of 100,000 warrants were issued as well,
          exercisable at a price of $2.06. These warrants expire on March 6,
          2003.

As well, on March 14, 2000, we became entitled to draw down on the $12 million
equity line of credit with Jaspas Investments Limited, a British Virgin Islands
corporation, through a common stock purchase agreement dated November 1,1999 for
the future issuance and purchase of Nymox's common shares. We expect the stock
purchase agreement with Jaspas to provide significant, long-term financing that
will enable us to advance our research and product development for the next
three years. We plan to seek additional capital within the limits on financing
contained in the common stock purchase agreement in order to accelerate product
development and marketing and obtaining necessary regulatory approvals.

You should refer to our F-1 Registration Statement filed with the SEC on
February 29, 2000 and declared effective on March 14, 2000 for the details of
our agreement with Jaspas. In general, the draw down facility created by the
facility operates like this: the investor, Jaspas, committed up to $12 million
to purchase Nymox's common shares of Nymox over a thirty month period. Once a
month, Nymox may request a draw of up to $750,000 of that money, subject to a
formula based on average stock price and average trading volume, setting the
maximum amount of any request for any given draw. At the end of a 22 day trading
period following the draw down request, the amount of money that Jaspas will
provide to Nymox and the number of shares Nymox will issue to Jaspas in return
for that money is settled based on the formula in the stock purchase agreement.
Jaspas receives a six (6%) percent discount to the market price for the 22 day
period and Nymox receives the settled amount of the draw down less a 3%
placement fee payable to its placement agents, Ladenburg Thalmann & Co. Inc. and
Paul Revere Capital Corp.

The facility is based on a "use-it-or-lose" principle. We are under no
obligation to request a draw for any month. However if we do not request a draw
for a given month, we may never to be able to draw those funds again. We may
make up to a maximum of twenty-four (24) draws.

In lieu of providing Jaspas with a minimum draw down commitment, we agreed to
issue to Jaspas a stock purchase warrant to purchase up to 200,000 shares of our
common stock with an exercise price of 110% of our share price on the closing
date of November 12, 1999 or $4.53. Jaspas may purchase under the warrant up to
100,000 Nymox shares any time between

                                       27
<PAGE>   28

November 30, 1999 and November 30, 2004. Jaspas may purchase the remaining
100,000 shares if and only if we do not draw down at least $7 million within 18
months of March 14, 2000.

As of March 31, 2001, the following drawings have been made under this Share
Purchase Agreement, for total proceeds of $1,327,273:

     -    August 16, 2000, 152,616 common shares at a volume weighted average
          price of US$3.2924 per share;

     -    October 12, 2000, 137,889 common shares at a volume weighted average
          price of US$3.6261 per share; and

     -    February 7, 2001, 161,696 common shares at a volume weighted average
          price of US$2.0240 per share.

Also, the Company has received a total proceeds of $335,025.00 (CAN$483,925)
from the exercise of 148,900 options at a price of $2.25 (CAN$3,25) since 1995.

Pursuant to the share purchase agreement entered into to acquire a controlling
interest of Serex, Inc., a total of 256,675 additional shares and 157,952
warrants were issued in exchange for the shares of Serex (see Note 5 "Business
Acquisition" in the financial statements).

In total, Nymox has raised over $23 million, since its incorporation in May
1995.

We have no financial obligations of significance other than long-term lease
commitments for our premises in the United States and Canada of $15,098 per
month in 2001 and ongoing research funding payments to a U.S. medical facility
totaling $172,000 for 2001. Total commitments beyond 2001 are summarized in note
7 to the consolidated financial statements.

RESULTS OF OPERATIONS

YEAR ENDED DECEMBER 31, 2000 COMPARED TO YEAR ENDED DECEMBER 31, 1999

Overview

Since inception, the Company has focused its activities on developing certain
pharmaceutical technologies and obtaining outside funding to support the
continued development of its technologies. The Company has incurred losses since
inception of operations. Future profitability will depend on the Company's
ability to generate revenues from the sale of products and the licensing of
technology sufficient to offset the expenditures required to further the
Company's research and development program and ongoing operations. See Item 4
for a description of the projects in the Company pipeline.

Effective January 1, 2000, the Company adopted the US dollar as its measurement
currency. See note 2(a) to the consolidated financial statements. All amounts
presented are in US dollars.

                                       28


<PAGE>   29

During the year, the Company acquired a majority interest in Serex, Inc. for a
consideration comprising common shares, warrants and options having a value of
approximately $1.3 million. See note 5 to the consolidated financial statements.

Revenue

Revenues from sales amounted to $157,688 for the year ended December 31, 2000,
compared with $153,252 for the year ended December 31, 1999. Sales for fiscal
2000 include the revenues from sales of the diagnostic test AlzheimAlert(TM) and
its predecessor AD7C(TM), the price for which was reduced in 2000, and of the
NicAlert(TM) test, since the date of acquisition of Serex. Interest revenue was
$68,179 in 2000 compared to $36,951 in 1999, derived from interest earned on the
Company's cash balances.

Expenses

Research and development expenditures were $2,084,232 for the year ended
December 31, 2000, compared with $1,137,122 for the year ended December 31,
1999, reflecting increased expenditures in the development of the products in
the Company's existing pipeline, as well as development of the potential
products acquired with the acquisition of Serex Inc. In 2000, research tax
credits amounted to $10,457 compared to $4,181 in 1999.

Management restructured its marketing activities resulting in a decrease in
expenditures to $363,142 for the year ended December 31, 2000 compared to
$942,205 for the year ended December 31, 1999.

General and administrative expenses amounted to $1,335,500 for the year ended
December 31, 2000, compared with $1,229,894 in the year ended December 31, 1999.
The increase was principally due to the acquisition of Serex Inc. in 2000.

Net losses for the period ended December 31, 2000 were $4,023,979, or $0.19 per
share, compared to $3,314,296, or $0.17 per share, for the same period in 1999.
The weighted average number of common shares outstanding for the period ending
December 31, 2000 were 20,890,735 compared to 19,886,430 for the same period in
1999.

Liquidity And Capital Resources

As of December 31, 2000, cash totaled $565,711. In November 1999, the
Corporation signed a common stock purchase agreement whereby the investor is
committed to purchase up to $12 million of the Corporation's common shares over
a thirty-month period commencing March 2000, when our F-1 registration statement
was declared effective. In 2000, two drawings were made under this Share
Purchase Agreement, for total proceeds of $1,000,000. Specifically, on August
16, 2000, 152,616 common shares were issued at a volume weighted average price
of US$3.2924 per share and on October 12, 2000, 137,889 common shares were
issued at a volume weighted average price of US$3.6261 per share. The Company
intends to access financing under this agreement when appropriate to fund its
research and development. The Company believes that the cash available under
this Share Purchase Agreement, along with the revenues generated by sales, will
be sufficient to finance its operations through 2001.

The Company invested $381,565 in additional capital assets in the year ended
December 31, 2000, consisting mostly of patent costs, compared to $164,783 in
the same period in 1999.

                                       29


<PAGE>   30
YEAR ENDED DECEMBER 31, 1999 COMPARED TO YEAR ENDED DECEMBER 31, 1998

Revenue

Revenues on service fees for the AD7C(TM) test amounted to $153,252 for the
year ended December 31, 1999, compared with $104,804 for the year ended December
31, 1998. All of the service fee revenue was derived from our AD7C(TM) urine
test service offered in our clinical reference laboratory. Interest revenue was
$36,951 in 1998 compared to $168,761 in 1997, derived from interest earned on
the cash and short-term investments received from the private placements
referred to previously.

Expenses

Research and development activities were reorganized resulting in a decrease in
expenditures to $1,137,122 for the year ended December 31, 1999, compared with
$2,091,745 for the year ended December 31, 1998. In 1999, research tax credits
amounted to $4,181 compared to $4,003 in 1997.

Management restructured its marketing activities resulting in a decrease in
expenditures to $942,205 for the year ended December 31, 1999 compared to
$2,245,023 for the year ended December 31, 1998.

General and administrative expenses amounted to $1,229,894 for the year ended
December 31, 1999, compared with $550,269 in the year ended December 31, 1998.
This rise is attributable to an increase in professional fees and in
administrative personnel.

Net losses for the period ended December 31, 1999 were $3,314,296, or $0.17 per
share, compared to $4,783,213, or $0.25 per share, for the same period in 1998.

YEAR ENDED DECEMBER 31, 1998 COMPARED TO YEAR ENDED DECEMBER 31, 1997

Revenue

Revenues on service fees for the AD7C(TM) test amounted to $104,804 for the
year ended December 31, 1998, compared with $17,033 for the year ended December
31, 1997. More than half of these revenues were generated in the last two months
of 1998 when we launched the urinary version of our AD7C(TM) urine test service
through our reference laboratory service. Interest revenue increased to $168,761
in 1998 compared to $53,022 in 1997, derived from interest earned on the cash
and short-term investments received from the private placements referred to
previously.

Expenses

Research and development expenditures amounted to $2,091,745 for the year ended
December 31, 1998, compared with $1,775,340 for the year ended December 31,
1997. The increase is principally attributable to increased expenditures on
reagents and clinical studies related to R&D in therapeutics and anti-infectives
at the U.S. laboratory during the year. In 1998, research tax

                                       30
<PAGE>   31
credits amounted to $4,003 compared to $103,928 in 1997. The reduction in tax
credits is attributable to the transfer of research and development to the
United States.

Marketing expenses amounted to $2,245,023 for the year ended December 31, 1998
compared to $1,334,202 for the year ended December 31, 1997. A major marketing
effort in 1998 accounted for the increased expenditures; the effort focused
specifically on mass mailings, publicity and presentations at conferences.

General and administrative expenses amounted to $620,939 for the year ended
December 31, 1998, compared with $408,456 in the year ended December 31, 1997.
The increase is attributable to increases in professional fees and increased
costs related to shareholder relations. Increases in both areas result from
first time contracts in 1998 with shareholder relations and public relations
firms.

Net losses for the period ended December 31, 1998 were $4,783,213, or $0.25 per
share, compared to $3,463,905, or $0.19 per share, for the same period in 1997.

INFLATION

We do not believe that inflation has had a significant impact on the results of
our operations.

ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES

DIRECTORS AND SENIOR MANAGEMENT

Senator W. David Angus, QC, 63, Chairman and Director since May 13, 1999, is an
honours graduate of Princeton University (AB '59) and McGill University (BCL
'62). He is a member of the Senate of Canada, serving on the Standing Committee
on Banking, Trade and Commerce. He is also a senior partner at the Montreal
office of Stikeman, Elliott, Canada's global law firm, and a director of several
other Canadian corporations and charitable organizations, including Air Canada,
AON Reed Stenhouse, Systech Retail Systems Inc., 3D Visit Inc., Eastern Canada
Towing Ltd. and the McGill University Health Center.

Dr. Paul Averback, M.D., D.A.B.P., 50, President and Director since September
1995, is the founder of Nymox and the inventor of much of its initial
technology.  Prior to founding Nymox, Dr. Averback served as President of
Nymox's predecessor, DMS Pharmaceuticals Inc.  He received his M.D. in 1975 and
taught pathology at universities, including Cambridge University, England
(1977-1980), during which time he initiated his research on Alzheimer's disease.
He has practiced medicine in numerous Canadian institutions as well as in
private practice.  Dr. Averback has published extensively in the scientific and
medical literature.

Dr. Hans Black, MD, 47, Director since May 13, 1999, has a doctorate in medicine
from McGill University, and is Chairman and Chief Investment Officer of
Interinvest Consulting Corporation, a Montreal-based global money management
firm with offices in Toronto and Boston and affiliates in Bermuda and Zurich.
Dr. Black appears regularly on the PBS network show,

                                       31
<PAGE>   32
Nightly Business Report, and has been a guest lecturer at Harvard, Temple and
McGill Universities.

Michael R. Sonnenreich, 62, Director since April 18, 2000, is a graduate of
Harvard University Law School, and is currently Chairman and CEO of Kikaku
America International, Senior Partner of Sonnenreich, Roccograndi & Woo P.C.,
President and CEO of Glocal Communications Corp. Ltd. of London, Vice Chairman
of PharMa International Corporation of Tokyo, Director of Asset Advisory
Services of Zurich, Member of the Board of Advisors of John Hopkins University
School of Advanced International Studies and Member of the Board of Overseers of
Tufts University Medical School. Mr. Sonnenreich has in the past been a Board
Member or a Trustee of numerous important companies and universities, and has
long-term involvements with many non-profit institutions, and served as
President of the National Coordinating Council on Drug Education.

Professor Walter P. von Wartburg, 61, Director since April 18, 2000, is a
partner in the private law practice of Law & Life Sciences in Basel,
Switzerland, specialized in biotech and drug regulatory affairs. He is a
graduate of the Universities of Basel, Paris, Princeton, Stanford and Harvard
Law School; Professor on public health policy at the Saint Gall Graduate School
of Economics, Business and Public Administration, and was a Member of the
Executive Committee of Novartis Inc. until 1999. He is author of various books
and articles on drug abuse, pharmaceutical legislation, biotechnology, and on
issues of management, communications and business administration. He is also
Chairman or Board Member of numerous institutions.

Michael Munzar, M.D., 47, Medical Director since June 1, 1996, received an M.D.
from the Faculty of Medicine, McGill University, in 1979. He practiced medicine
for over 15 years in a variety of institutional and private practice settings.
He has a diverse medical background that includes most aspects of medical care,
including geriatrics and psychiatry. He also has extensive business experience
with the establishment, operation and management of medical facilities.

Judith Fitzpatrick, Ph.D., Vice-President for Scientific Affairs, 53, received a
Ph.D. in immunology from Mt. Sinai Medical School (City College of New York) in
1981, and from 1981 to 1984 was employed by Becton Dickinson as a Senior
Scientist. She founded Serex, Inc. in 1984 and has extensive experience both in
the scientific and commercial aspects of the development of diagnostic tests.
From 1984 to the early 1990's, she developed and supervised the manufacture of
laboratory tests for drugs and proteins of interest to the life insurance
industry. Dr. Fitzpatrick is a co-inventor of Serex's patented diagnostic
system.

Jack Gemmell, B.Sc.(Hons.), LL.B., 49, General Counsel and Chief Information
Officer since July, 1998. Mr. Gemmell graduated from the Faculty of Law at the
University of Toronto in 1977 and was called to the bar in 1979. He practiced
primarily in the area of litigation for over 19 years before joining Nymox in
July, 1998 and has substantial business experience with the management and
operation of a legal practice.

Mr. Roy M. Wolvin, 46, Secretary-Treasurer and Chief Financial Officer since
September 1995. Prior to September 1995, Mr. Wolvin was Account Manager, private
business, for a Canadian chartered bank. Mr. Wolvin holds a degree in Economics
from the University of Western Ontario.

                                       32
<PAGE>   33

COMPENSATION

a)   The table below provides compensation information for the fiscal year ended
December 31, 2000 for each executive officer of Nymox and for the directors and
executive officers as a group.

Summary Compensation Table

<TABLE>
<CAPTION>

                                                Fiscal Year ending                      Fiscal Year ending
                                                  Dec. 31, 2000                            Dec. 31, 1999
                                                ------------------                      ------------------

                                                                     Other Cash                          Other Cash
Name and Principal Position                     Salary              Compensation          Salary        Compensation
---------------------------                     ------              ------------          ------        ------------
<S>                                          <C>                        <C>             <C>                 <C>
Dr. Paul Averback                            CAN$137,500                                CAN$150,000
President and C.E.O.                          (US$91,697)                -              (US$103,925)         -

Mr. Roy Wolvin                                CAN$84,375                                 CAN$70,200
Secretary-Treasurer                           (US$56,269)                -               (US$48,640)         -

Mr. Jack Gemmell                             CAN$118,161                                CAN$120,000
General Counsel                               (US$78,801)                -               (US$83,143)         -

Dr. Judith Fitzpatrick
Vice President                                US$125,000              US$4,263                  N/A          -

Dr. Michael Munzar                           CAN$171,000                                CAN$174,000
Medical Director                             (US$114,038)                -              (US$120,557)         -

All directors and senior management          CAN$698,474                                CAN$514,200
as a group                                   (US$465,805)             US$4,263          (US$356,265)         -
</TABLE>

Nymox does not have written employment contracts with any of the senior
management named above except with Dr. Judith Fitzpatrick.

Directors of Nymox, with the exception of the President, are paid a fee of
$1,000 for each board meeting attendance and are reimbursed for expenses
incurred in connection with their office.

The Company does not have any pension plans or other type of plans providing
retirement or similar benefits for senior management.

BOARD PRACTICES

Directors are elected at each annual meeting for a term of office until the next
annual meeting. Executive officers are appointed by the board of directors and
serve at the pleasure of the board. Other than Dr. Averback, no other officer or
director previously was affiliated with DMS Pharmaceuticals Inc.

There are no family relationships between any director or executive officer and
any other director or executive officer.


                                       33
<PAGE>   34
Nymox does not have written contracts with any of the directors named above.
The Company does not have any pension plans or other type of plans providing
retirement or similar benefits for directors, nor any benefits upon termination
of service as a director.

Nymox's Audit Committee recommends to the Board of Directors the firm to be
appointed each year as independent auditors of the company's financial
statements and to perform services related to the completion of such audit and
the compensation to be paid to the firm. The Audit Committee also has
responsibility for:

     -    reviewing the scope and results of the audit with the independent
          auditors;

     -    reviewing with management and the independent auditors the company's
          interim and year-end financial condition and results of operations;

     -    considering the adequacy of the internal accounting, bookkeeping and
          control procedures of the company; and

     -    reviewing any non-audit services and special engagements to be
          performed by the independent auditors and considering the effect of
          such performance on the auditors' independence.

The Audit Committee also reviews at least once each year the terms of all
material transactions and arrangements between the company and its affiliates.
The Chairman of the Audit Committee is Hans Black, M.D. and the other members
are Michael Sonnenreich, Walter von Wartburg and Paul Averback, M.D. The
Chairman of the Board of Directors, Senator W. David Angus, Q.C., is also by
virtue of his office a member of the Audit Committee.

Nymox's Human Resources and Compensation Committee establishes and reviews
overall policy and structure with respect to compensation matters, including the
determination of compensation arrangements for directors, executive officers and
key employees of the company. The Committee is also responsible for the
administration and award of options to purchase shares pursuant to the company's
option and share purchase plans. The Chairman of the Human Resources and
Compensation Committee is Paul Averback, M.D. and the other member is Professor
Walter von Wartburg. The Chairman of the Board of Directors, Senator W. David
Angus, Q.C., is also by virtue of his office a member of this Committee.

EMPLOYEES

<TABLE>
<CAPTION>
                                              2000           1999          1998
Average Number of Employees by              -------        -------       -------
Sector and Geographic Location              US  CAN        US  CAN       US  CAN
------------------------------              --  ---        --  ---       --  ---
<S>                                         <C> <C>        <C> <C>       <C> <C>
Research & Development                       9    8        10    6       12    4

Administration & Marketing                   2    3         9    4        8    4
                                            --   --        --   --       --   --
Total                                       11   11        19   10       20    8
                                            ==   ==        ==   ==       ==   ==
</TABLE>

                                       34
<PAGE>   35

SHARE OWNERSHIP

As at March 31, 2001, the numbers of common shares owned and options granted to
directors and senior officers of the Corporation were as follows:

<TABLE>
<CAPTION>
                                         COMMON SHARES         OPTIONS          OPTIONS                                  EXPIRY DATE
NAME                                         OWNED              VESTED         NOT VESTED         EXERCISE PRICE            M/D/Y
----                                     -------------         -------         ----------         --------------         -----------
<S>                                       <C>                  <C>               <C>                 <C>                  <C>
Paul Averback, M.D.                       12,646,895

W. David Angus, Q.C.                          25,000
                                                                60,000                                  $3.12             05/13/09
                                                                                                      (C$4.50)
                                                                10,000                                  $6.93             05/13/09
                                                                                                     (C$10.00)
                                                                                 30,000                 $6.93             05/13/09
                                                                                                     (C$10.00)

Hans Black, M.D.                              10,000            25,000                                  $3.12             05/13/09
                                                                                                      (C$4.50)
                                                                25,000                                  $3.875            05/01/10
                                                                                 50,000                 $6.93             05/01/10
                                                                                                     (C$10.00)
                                                                10,000                                  $4.70             06/15/10

Michael Sonnenreich                           30,000           100,000                                  $3.875            05/01/10

Walter Von Wartburg                           32,000           100,000                                  $3.875            05/01/10

Roy Wolvin                                     5,000            10,000                                  $2.25             01/17/06
                                                                                                      (C$3.25)
                                                                10,000                                  $9.53             01/17/06
                                                                                                     (C$13.75)
                                                                10,000                                  $6.79             01/17/06
                                                                                                      (C$9.80)
                                                                20,000                                  $6.93             01/17/06
                                                                                                     (C$10.00)
                                                                20,000                                  $3.12             05/13/09
                                                                                                      (C$4.50)

Michael Munzar                                31,325            50,000                                  $7.97             04/30/06
                                                                                                     (C$11.50)
                                                                 5,000                                  $6.24             10/31/07
                                                                                                      (C$9.00)
                                                                30,000                                  $6.93             10/31/07
                                                                                                     (C$10.00)
                                                                                 10,000                 $6.93             10/31/07
                                                                                                     (C$10.00)
                                                                20,000                                  $3.12             05/13/09
                                                                                                      (C$4.50)
                                                                50,000                                  $3.90             08/25/10

Jack Gemmell                                  10,000            50,000                                  $6.93             01/22/09
                                                                                                     (C$10.00)
                                                                25,000                                  $3.875            05/01/10

Judith Fitzpatrick                           187,951            10,000           30,000                 $3.70             01/08/10
</TABLE>

                                       35


<PAGE>   36

LEGAL PROCEEDINGS

Amro International, S.A., a Panamanian company, has served Nymox Pharmaceutical
Corporation with a Statement of Claim filed with the Ontario Superior Court of
Justice (Court File No. 00-CV-201587), claiming to be entitled to the issuance
of 388,797 shares in accordance with repricing provisions contained in the
March, 2000 agreement between Amro and Nymox and to damages for lost opportunity
to sell these shares. Nymox believes that Amro's interpretation of the repricing
provisions in the March, 2000 agreement is incorrect. Nymox has filed a
statement of defense and intends to defend the action vigorously and to consider
its other options with respect to this matter.

ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS

MAJOR SHAREHOLDERS

The following table sets out as of March 31, 2001 the number of common shares
owned by Dr. Paul Averback, the President and CEO of Nymox and a member of the
Nymox board of directors, and by all directors and officers as a group. Dr.
Averback is the only person known to Nymox to own more than 5% of the common
shares.

<TABLE>
<CAPTION>

Name of Shareholder                        Number of Common Shares     Percent of Class of
                                           owned by Shareholder        Common Shares
                                           -----------------------     -------------------

<S>                                              <C>                         <C>
Dr. Paul Averback                                 12,646,895                   58.2%

All directors and officers as a group             12,978,171                   59.7%

</TABLE>

In addition, as of March 31, 2001, Dr. Averback's wife owned 848,172 common
shares (3.9%) and 9022-1433 Canada Inc., a company owned by Dr. Averback and his
wife, owns 500,000 common shares (2.3%).

The above shareholders have the same voting rights as all other shareholders.
There has been no significant change in ownership for any of the persons listed
above over the past three years.

Nymox does not know of any other shareholder who beneficially owns more than 5%
of Nymox's shares.

According to information furnished to Nymox by the transfer agent for the common
shares, as of March 31, 2001, total shares outstanding were 21,739,317. There
were 909 holders of record of the common shares and 4,363 beneficial
shareholders in total. Of these, 123 were holders of record of the common shares
and 2,531 were beneficial shareholders with addresses in the United States and
such holders owned an aggregate of 3,256,666 shares, representing 15.1% of the
outstanding shares of common stock.

RELATED PARTY TRANSACTIONS

Not applicable

                                       36

<PAGE>   37

ITEM 8. FINANCIAL INFORMATION


                      Consolidated Financial Statements of


                              NYMOX PHARMACEUTICAL
                                  CORPORATION


                  Years ended December 31, 2000, 1999 and 1998


                                       37







<PAGE>   38

AUDITORS' REPORT TO THE SHAREHOLDERS

We have audited the consolidated balance sheets of Nymox Pharmaceutical
Corporation as at December 31, 2000 and 1999 and the consolidated statements of
earnings, deficit and cash flows for the years ended December 31, 2000, 1999 and
1998. These financial statements are the responsibility of the Corporation's
management. Our responsibility is to express an opinion on these financial
statements based on our audits.

With respect to the consolidated financial statements for the year ended
December 31, 2000, we conducted our audit in accordance with Canadian generally
accepted auditing standards and United States generally auditing standards. With
respect to the consolidated financial statements for each of the years in the
two-year period ended December 31, 1999, we conducted our audits in accordance
with Canadian generally accepted auditing standards. Those standards require
that we plan and perform an audit to obtain reasonable assurance whether the
financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation.

In our opinion, these consolidated financial statements present fairly, in all
material respects, the financial position of the Corporation as at December 31,
2000 and 1999 and the results of its operations and its cash flows for the years
ended December 31, 2000, 1999 and 1998 in accordance with Canadian generally
accepted accounting principles.

Canadian generally accepted accounting principles vary in certain significant
respects from accounting principles generally accepted in the United States.
Application of accounting principles generally accepted in the United States
would have affected results of operations for each of the years in the
three-year period ended December 31, 2000 and shareholders' equity as at
December 31, 2000, 1999 and 1998 to the extent summarized in note 10 to the
consolidated financial statements.




/s/ KPMG, LLP
Chartered Accountants


Montreal, Canada
February 22, 2001

                                       38


<PAGE>   39


NYMOX PHARMACEUTICAL CORPORATION

Consolidated Financial Statements

Years ended December 31, 2000, 1999 and 1998

<TABLE>
<CAPTION>
<S>                                                                            <C>

FINANCIAL STATEMENTS

     Consolidated Balance Sheets............................................  40

     Consolidated Statements of Earnings....................................  41

     Consolidated Statements of Deficit.....................................  42

     Consolidated Statements of Cash Flows..................................  43

     Notes to Consolidated Financial Statements.............................  44


</TABLE>


                                       39
<PAGE>   40
NYMOX PHARMACEUTICAL CORPORATION
Consolidated Balance Sheets

December 31, 2000 and 1999
(in US dollars)

<TABLE>
<CAPTION>
                                                         2000               1999
                                                 ------------       ------------
<S>                                              <C>                <C>
Assets
Current assets:
     Cash                                        $    565,711       $    449,363
     Accounts and other receivables                   101,517             43,001
     Research tax credits receivable                   10,457              3,180
     Notes receivable (note 3)                         -                 181,280
     Inventory                                          4,325             -
     Prepaid expenses                                  67,500            100,000
                                                 ------------       ------------
                                                      749,510            776,824
Capital assets (note 4)                             3,546,616          1,168,316
Deferred share issuance costs (note 6 (c))            222,512            195,351
                                                 ------------       ------------
                                                 $  4,518,638       $  2,140,491
                                                 ============       ============
Liabilities and Shareholders' Equity
Current liabilities:
     Accounts payable and accrued liabilities    $    323,774       $    486,916
     Note payable                                      -                 346,428
                                                 ------------       ------------
                                                      323,774            833,344
Non-controlling interest (note 5)                     933,922             -

Shareholders' equity:
     Share capital (note 6)                        23,243,941         16,912,963
     Deficit                                      (19,982,999)       (15,605,816)
                                                 ------------       ------------
                                                    3,260,942          1,307,147
Commitments and contingency (note 7)
Subsequent event (note 12)
                                                 ------------       ------------
                                                 $  4,518,638       $  2,140,491
                                                 ============       ============
</TABLE>

See accompanying notes to consolidated financial statements.

On behalf of the Board:

/s/ Paul Averback, MD, Director

/s/ Hans Black, MD, Director


                                       40
<PAGE>   41
NYMOX PHARMACEUTICAL CORPORATION
Consolidated Statements of Earnings

Years ended December 31, 2000, 1999 and 1998
(in US dollars)


<TABLE>
<CAPTION>
                                                 2000             1999              1998
                                          -----------      -----------       -----------
<S>                                        <C>              <C>               <C>
Revenues:

     Sales                                $   157,688      $   153,252       $   104,804
     Interest                                  68,179           36,951           168,761
                                          -----------      -----------       -----------
                                              225,867          190,203           273,565

Expenses:
     Research and development               2,084,232        1,137,122         2,091,745
     Less research tax credits                (10,457)          (4,181)           (4,003)
                                          -----------      -----------       -----------
                                            2,073,775        1,132,941         2,087,742
     Marketing                                363,142          942,205         2,245,023
     General and administrative             1,335,500        1,229,894           550,269
     Cost of sales                             87,450          103,340            70,670
     Depreciation and amortization            375,810          136,947            93,917
     Interest and bank charges                 14,169            5,856             9,157
                                          -----------      -----------       -----------
                                            4,249,846        3,551,183         5,056,778
Gain on disposal of capital assets              -              (46,684)            -
                                          -----------      -----------       -----------
                                            4,249,846        3,504,449         5,056,778
                                          -----------      -----------       -----------
Net loss                                  $(4,023,979)     $(3,314,296)      $(4,783,213)
                                          ===========      ===========       ===========
Loss per share                            $     (0.19)     $     (0.17)      $     (0.25)
                                          ===========      ===========       ===========
Weighted average number of common shares   20,890,735       19,886,430        19,304,435
                                          ===========      ===========       ===========

</TABLE>

See accompanying notes to consolidated financial statements


                                       41
<PAGE>   42


NYMOX PHARMACEUTICAL CORPORATION
Consolidated Statements of Deficit

Years ended December 31, 2000, 1999 and 1998
(in US dollars)

<TABLE>
<CAPTION>

                                        2000            1999            1998
                                ------------    ------------    ------------
<S>                             <C>             <C>              <C>
Deficit, beginning of year      $(15,605,816)   $(12,256,479)   $ (7,415,759)

Net loss                          (4,023,979)     (3,314,296)     (4,783,213)

Share issue costs                   (353,204)        (35,041)        (57,507)
                                ------------    ------------    ------------
Deficit, end of year            $(19,982,999)   $(15,605,816)   $(12,256,479)
                                ============    ============    ============
</TABLE>

See accompanying notes to consolidated financial statements.

                                       42
<PAGE>   43
NYMOX PHARMACEUTICAL CORPORATION
Consolidated Statements of Cash Flows

Years ended December 31, 2000, 1999 and 1998
(in US dollars)
<TABLE>
<CAPTION>
                                                                2000              1999              1998
                                                         -----------       -----------       -----------
<S>                                                     <C>                <C>               <C>

Cash flows from operating activities:
     Net loss                                           $(4,023,979)       $(3,314,296)      $(4,783,213)
     Adjustments for:
         Depreciation and amortization                      375,810            136,947            93,917
         Gain on disposal of capital assets                      -             (46,684)               -
         Foreign exchange                                        -             (13,453)           (4,858)
         Write-off of note receivable                       108,280                 -                 -
     Change in operating assets and liabilities:
         Accounts and other receivables                      16,730             36,316           (59,464)
         Interest receivable                                     -              31,928           (29,018)
         Receivable from a financial institution                 -             441,696          (441,696)
         Research tax credits receivable                     (7,277)               824             99,925
         Inventory                                           (4,325)                -                  -
         Prepaid expenses                                    56,000           (102,945)                -
         Accounts payable and accrued liabilities          (380,511)           188,872             93,129
                                                         -----------       -----------        -----------
                                                          (3,859,272)       (2,640,795)        (5,031,278)
Cash flows from financing activities:
     Proceeds from issuance of share capital               5,010,981           969,253          5,996,622
     Proceeds from notes payable                             201,993           346,428                 -
     Repayment of notes payable                             (548,421)               -                  -
     Share issue costs                                      (380,365)         (230,392)           (57,507)
                                                         -----------       -----------        -----------
                                                           4,284,188         1,085,289          5,939,115

Cash flows from investing activities:
     Additions to capital assets                            (381,568)         (164,783)          (390,125)
     Proceeds from disposal of capital assets                     -            185,896                 -
     Proceeds from collection of
       notes receivable                                       73,000                -            (151,040)
     Net proceeds on maturity of (purchases of)
       short-term investments                                     -          1,464,635           (231,290)
                                                         -----------       -----------        -----------
                                                            (308,568)        1,485,748           (772,455)

Effect of foreign exchange rate changes on cash                   -             24,215              8,066
                                                         -----------       -----------        -----------
Net increase (decrease) in cash                              116,348           (45,543)           143,448

Cash, beginning of year                                      449,363           494,906            351,458
                                                         -----------       -----------        -----------
Cash, end of year                                        $   565,711       $   449,363        $   494,906
                                                         ===========       ===========        ===========

Supplemental disclosure to statements of cash flows:
     (a) Interest paid                                   $    14,169        $    5,856        $     9,157
     (b) Non-cash transactions:
              Acquisition of Serex Inc. by issuance
                of common shares and other securities      1,319,997                -                  -
              Amortization of deferred share
                issue costs                                   20,220                -                  -

                                                         ===========       ===========        ===========
</TABLE>

See accompanying notes to consolidated financial statements.

                                       43


<PAGE>   44


NYMOX PHARMACEUTICAL CORPORATION
Notes to Consolidated Financial Statements

Years ended December 31, 2000, 1999 and 1998
(in US dollars)

1.   ORGANIZATION AND BUSINESS ACTIVITIES:

     Nymox Pharmaceutical Corporation (the "Corporation"), incorporated under
     the Canada Business Corporations Act, is a development stage
     biopharmaceutical corporation which specializes in the research and
     development of products for the diagnosis and treatment of Alzheimer's
     disease. The Corporation is currently marketing AlzheimAlert(TM), a urinary
     test that aids physicians in the diagnosis of Alzheimer's disease, and is
     developing treatments aimed at the causes of Alzheimer's disease. The
     Corporation also markets NicAlert(TM), a test that uses urine or saliva to
     detect use of tobacco products. The Corporation is developing a new class
     of antibacterial agents for the treatment of urinary tract and other
     bacterial infections in humans which have proved highly resistant to
     conventional antibiotic treatments and for the treatment of E-coli 0157:H7
     bacterial contamination in hamburger meat and other food and drink
     products. Under development at its subsidiary, Serex, Inc., are a potential
     saliva-based cholesterol test and a potential test for osteoporosis.

     Since inception, the Corporation's activities have been primarily focused
     on developing certain pharmaceutical technologies and obtaining outside
     funding to support the continued development of its technologies.
     Cumulative disclosure of selected financial information is presented in
     note 10 (c). The Corporation is subject to a number of risks, including the
     successful development and marketing of its technologies. In order to
     achieve its business plan and the realization of its assets and settlement
     of its liabilities in the normal course of operations, the Corporation
     anticipates the need to raise additional capital and/or achieve sales and
     other revenue generating activities. (See notes 6 (c) and 12).

     The Corporation is listed on the NASDAQ Stock Market.

2.   SIGNIFICANT ACCOUNTING POLICIES:

     (a)  Consolidation and change in measurement currency:

          The consolidated financial statements of the Corporation have been
          prepared under Canadian generally accepted accounting principles
          ("GAAP") and include the accounts of its US subsidiaries, Nymox
          Corporation and Serex Inc. Intercompany balances and transactions have
          been eliminated on consolidation.

          Consolidated financial statements prepared under US GAAP would differ
          in some respects from those prepared in Canada. A reconciliation of
          earnings and shareholders' equity reported in accordance with Canadian
          GAAP and with US GAAP is presented in note 10.

                                       44

<PAGE>   45

NYMOX PHARMACEUTICAL CORPORATION
Notes to Consolidated Financial Statements, Continued

Years ended December 31, 2000, 1999 and 1998
(in US dollars)

2.   SIGNIFICANT ACCOUNTING POLICIES (CONTINUED):

     (a)  Consolidation and change in measurement currency (continued):

          Effective January 1, 2000, the Corporation adopted the United States
          dollar as its measurement currency as a result of the significance of
          business activities conducted in the United States and the increasing
          proportion of operating, financing and investing transactions in the
          Canadian operations that are denominated in U.S. dollars. In
          accordance with Canadian GAAP, the consolidated financial statements
          for the comparative figures as at and for the years ended December 31,
          1999 and 1998 have been presented in US dollars using the convenience
          translation method whereby all Canadian dollar amounts were converted
          into US dollars at the closing exchange rate at December 31, 1999,
          which was $1.4433 Canadian dollar per US dollar.

     (b)  Inventory:

          Inventory consists of finished goods and are carried at the lower of
          cost and net realizable value. The cost of finished goods is
          determined using the full cost accounting method.

     (c)  Capital assets:

          Capital assets are recorded at cost. Depreciation and amortization are
          provided using the following methods and annual rates:

<TABLE>
<CAPTION>


          Asset                                        Method             Rate
          -----                                        ------             ----
         <S>                                          <C>                 <C>
         Computer equipment                         Straight-line          20%
         Laboratory equipment                       Straight-line          20%
         Office equipment and fixtures              Straight-line          20%
         Intellectual property rights               Straight-line          10%

</TABLE>

          The capitalized amount with respect to patents relates to direct costs
          incurred in connection with securing the patents. The cost of the
          patents does not necessarily reflect their present or future value and
          the amount ultimately recoverable is dependent upon the successful
          commercialization of the related products. Accordingly, patents are
          being amortized using the straight-line method commencing in the year
          of commercial production of the developed products. The capitalized
          amount is being amortized over the remaining years of the initial life
          of the patent of approximately 20 years.

          Management reviews the unamortized balance of intellectual property
          rights and patents on an annual basis and recognizes any impairment in
          carrying value when it is identified.

     (d)  Revenue recognition:

          Revenue from service fees is recognized when the service is performed.

                                       45
<PAGE>   46
NYMOX PHARMACEUTICAL CORPORATION
Notes to Consolidated Financial Statements, Continued

Years ended December 31, 2000, 1999 and 1998
(in US dollars)

2. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED):

     (e)  Research and development expenditures:

          Research expenditures, net of research tax credits, are expensed as
          incurred. Development expenditures, net of tax credits, are expensed
          as incurred, except if they meet the criteria for deferral in
          accordance with generally accepted accounting principles.

     (f)  Foreign exchange:

          The Corporation's measurement currency is the United States dollar.
          Monetary assets and liabilities of the Canadian and foreign operations
          denominated in currencies other than the United States dollar are
          translated at the rates of exchange prevailing at the balance sheet
          dates. Other assets and liabilities denominated in currencies other
          than the United States dollar are translated at the exchange rates
          prevailing when the assets were acquired or the liabilities incurred.
          Revenues and expenses denominated in currencies other than the United
          States dollar are translated at the average exchange rate prevailing
          during the year, except for depreciation and amortization which are
          translated at the same rates as those used in the translation of the
          corresponding assets. Foreign exchange gains and losses resulting from
          the translation are included in the determination of net earnings.

     (g)  Stock-based compensation plan:

          No compensation expense is recognized under the Corporation's
          stock-based compensation plan when stock options are issued to
          employees. Any consideration paid by employees on exercise of stock
          options is credited to share capital.

     (h)  Income taxes:

          In 2000, the Corporation adopted the new recommendations of the
          Canadian Institute of Chartered Accountants ("CICA") with respect to
          accounting for income taxes. The CICA's new standard adopts the asset
          and liability method of accounting for income taxes. Under this
          method, future income tax assets and liabilities are determined based
          on "temporary differences" (differences between the accounting basis
          and the tax basis of the assets and liabilities), and are measured
          using the currently enacted, or substantively enacted, tax rates and
          laws expected to apply when these differences reverse. A valuation
          allowance is recorded against any future income tax asset if it is
          more likely than not that the asset will not be realized. Income tax
          expense or benefit is the sum of the Company's provision for current
          income taxes and the difference between the opening and ending
          balances of the future income tax assets and liabilities.

                                       46
<PAGE>   47

NYMOX PHARMACEUTICAL CORPORATION
Notes to Consolidated Financial Statements, Continued

Years ended December 31, 2000, 1999 and 1998
(in US dollars)

2.   SIGNIFICANT ACCOUNTING POLICIES (CONTINUED):

     (h)  Income taxes (continued):

          Prior to adoption of this new accounting standard, income tax expense
          was determined using the deferral method. Under this method, deferred
          income tax expense was determined based on "timing differences"
          (differences between the accounting and tax treatment of items of
          expense or income), and were measured using the tax rates in effect in
          the year the differences originated. Certain deferred tax assets, such
          as the benefit of tax losses carried forward, were not recognized
          unless there was virtual certainty that they would be realized.

          The Company has adopted the new income tax accounting standard and has
          applied the provisions of the standard retroactively to January 1,
          1998. The adoption of the new standard did not affect current or
          previously reported earnings.

     (i)  Use of estimates:

          The preparation of financial statements in conformity with generally
          accepted accounting principles requires management to make estimates
          and assumptions that affect the reported amounts of assets and
          liabilities and disclosure of contingent assets and liabilities at the
          date of the financial statements and the reported amounts of revenues
          and expenses during the reporting periods. Actual results could differ
          from those estimates.

     (j)  Loss per share:

          The loss per share amounts have been calculated using the weighted
          average number of common shares outstanding during the year. Fully
          diluted loss per share has not been disclosed because the effect of
          common shares issuable upon the exercise of options and warrants would
          be anti-dilutive.

3.   NOTES RECEIVABLE:

<TABLE>
<CAPTION>

                                                                                        2000                 1999
                                                                                       -----                -----
<S>                                                                                <C>                   <C>
     Note receivable, unsecured, non-interest bearing, payable on demand         $     -              $    38,800

     Note receivable, unsecured, bearing interest at 9% per annum beginning
       February 1, 1999, payable on demand, denominated in US dollars                  -                  142,480
                                                                                 -----------          -----------
                                                                                 $     -              $   181,280
                                                                                 ===========          ===========


</TABLE>
                                       47



<PAGE>   48
NYMOX PHARMACEUTICAL CORPORATION
Notes to Consolidated Financial Statements, Continued

Years ended December 31, 2000, 1999 and 1998
(in US dollars)


3.   NOTES RECEIVABLE (CONTINUED):

     The notes were receivable from a former director and senior executive who
     is no longer associated with the Company. In 1999, Nymox Corporation, the
     Corporation's subsidiary, commenced an action against the former director
     for repayment of the two promissory notes and on August 5, 1999, the court
     granted Nymox Corporation's motion for summary judgment. During 2000, all
     actions were settled between the parties and the Corporation received
     approximately $73,000 as full settlement for the notes receivable. The
     difference of $108,280 was expensed in 2000.

4.   CAPITAL ASSETS:
<TABLE>
<CAPTION>
                                                         2000
                                       ----------------------------------------

                                                     Accumulated       Net book
                                             Cost   depreciation          value
                                       ----------   ------------     ----------
<S>                                    <C>          <C>              <C>
     Computer equipment                $   73,049       $ 33,611     $   39,438
     Laboratory equipment                 613,219        401,389        211,830
     Office equipment and fixtures         88,949         71,538         17,411
     Patents                            1,322,496        162,696      1,159,800
     Intellectual property rights       2,353,486        235,349      2,118,137
                                       ----------       --------     ----------
                                       $4,451,199       $904,583     $3,546,616
                                       ==========       ========     ==========
</TABLE>

<TABLE>
<CAPTION>
                                                         1999
                                       ----------------------------------------

                                                      Accumulated      Net book
                                             Cost    depreciation         value
                                       ----------    ------------    ----------
<S>                                    <C>          <C>              <C>

     Computer equipment                $   57,713       $ 25,203     $   32,510
     Laboratory equipment                 258,145        104,053        154,092
     Office equipment and fixtures         26,527         11,750         14,777
     Patents                            1,042,427         75,491        966,936
     Intellectual property rights               1           -                 1
                                       ----------       --------     ----------
                                       $1,384,813       $216,497     $1,168,316
                                       ==========       ========     ==========

</TABLE>

                                       48
<PAGE>   49

NYMOX PHARMACEUTICAL CORPORATION
Notes to Consolidated Financial Statements, Continued

Years ended December 31, 2000, 1999 and 1998
(in US dollars)

5.   BUSINESS ACQUISITION:

     The Corporation entered into a share purchase agreement to acquire a
     controlling interest in Serex, Inc. ("Serex"), a privately-held development
     stage corporation based in New Jersey. When the agreement closed on March
     2, 2000, the Corporation acquired 72.3% of the issued and outstanding
     common stock of Serex in exchange for 187,951 common shares of the
     Corporation having a value of approximately $657,825, and a warrant to
     purchase 115,662 of the Corporation's common shares at a price of $3.70 per
     share exercisable on the following dates: (i) January 8, 2001 - 35,783
     shares (ii) January 8, 2002 - 30,000 shares (iii) January 8, 2003 - 30,000
     shares, (iv) January 8, 2004 - 19,879 shares. In connection with this
     acquisition, the Corporation also issued 40,000 options to the selling
     shareholder to purchase the Corporation's shares. The options are
     exercisable at a price of $3.70/share over a four-year period.

     On August 1, 2000, the Corporation acquired an additional 293,138 shares of
     Serex for a consideration consisting of 54,646 common shares of the
     Corporation having a value of $191,261 and warrants to purchase 33,627 of
     the Corporation's common shares at a price of $3.70 per share. On October
     25, 2000, the Corporation acquired an additional 75,520 shares of Serex for
     a consideration of 14,078 common shares of the Corporation having a value
     of $49,273 and warrants to purchase 8,663 of the Corporation's common
     shares at a price of $3.70 per share. After the above transactions, the
     Corporation had approximately 97% of the outstanding shares of Serex.

     Details of the acquisition are as follows:
<TABLE>
<S>                                                                <C>
     Assets acquired:
         Current assets                                            $     98,746
         Capital assets                                                  19,056
         Current liabilities                                           (217,369)
         Non-controlling interest (i)                                  (933,922)
                                                                    -----------
                                                                     (1,033,489)

     Patents, technological platform and know-how acquired
       ("Intellectual property rights")                               2,353,486
                                                                    -----------
     Value of assets acquired                                       $ 1,319,997
                                                                    ===========

     Consideration:
         Common shares                                              $   898,359
         Warrants and options (ii)                                      421,638
                                                                    -----------
                                                                    $ 1,319,997
                                                                    ===========

</TABLE>
                                       49


<PAGE>   50

NYMOX PHARMACEUTICAL CORPORATION
Notes to Consolidated Financial Statements, Continued

Years ended December 31, 2000, 1999 and 1998
(in US dollars)

5.   BUSINESS ACQUISITION (CONTINUED):

     (i)  Non-controlling interest includes redeemable, convertible preferred
          shares of Serex held by third parties in the amount of $800,000. Up to
          50% of preferred shares are redeemable at any time at the option of
          the preferred shareholders for their issue price. The preferred shares
          are convertible into common shares of Serex at a price of $3.946 per
          share.

     (ii) The Corporation determined that the warrants and options issued in
          connection with the acquisition of Serex had a value of $421,638,
          which was determined using the methodology described in
          note 10 (d)(2).

6.   SHARE CAPITAL:
<TABLE>
<CAPTION>
                                                                              2000              1999
                                                                           -----------      -----------
<S>                                                                        <C>               <C>
    Authorized:
         An unlimited number of common shares

     Issued and outstanding:
         21,377,621 common shares (1999 - 20,003,804)                      $22,822,303       $16,912,963
         Warrants and options (see note 5 (ii))                                421,638                 -
                                                                           -----------       -----------
                                                                           $23,243,941       $16,912,963
                                                                           ===========       ===========
</TABLE>

     (a)  Changes in the Corporation's outstanding common shares are presented
          below:
<TABLE>
<CAPTION>
                                                                             Shares            Dollars
                                                                           -----------      ------------
<S>                                                                        <C>               <C>

     Issued and outstanding, December 31, 1998                              19,727,904       $15,943,710

     Issue of common shares for cash (b)                                       177,000           746,553

     Issue of common shares pursuant to exercise
       of stock options (e)                                                     98,900           222,700
                                                                            ----------       -----------
     Balance, December 31, 1999                                             20,003,804        16,912,963

     Issue of common shares for cash (b) (c)                                 1,112,142         5,000,000

     Issue of common shares in connection
       with Serex acquisition                                                  256,675           898,359

     Issue of common shares pursuant to exercise
       of stock options (e)                                                      5,000            10,981
                                                                            ----------       -----------
     Balance, December 31, 2000                                             21,377,621       $22,822,303
                                                                            ==========       ===========
</TABLE>

                                       50



<PAGE>   51
NYMOX PHARMACEUTICAL CORPORATION
Notes to Consolidated Financial Statements, Continued

Years ended December 31, 2000, 1999 and 1998
(in US dollars)

6.   SHARE CAPITAL (CONTINUED):

     (b)  Private placements:

          In 2000, the Corporation completed a private placement for 821,637
          common shares for received aggregate proceeds of $4,000,000. In 1999,
          the Corporation completed private placements for 177,000 common shares
          for total aggregate proceeds of $746,553. The share issue costs
          related to these private placements have been charged against the
          deficit. See note 7 (c).

     (c)  Common Stock Purchase Agreement:

          In November 1999, the Corporation and Jaspas Investments Limited
          ("Jaspas"), a corporation based in the British Virgin Islands, signed
          a common stock purchase agreement (the "Agreement") that establishes
          the terms and conditions for the future issuance and purchase of the
          Corporation's common shares by Jaspas. In general terms, Jaspas is
          committed to purchase up to $12 million of the Corporation's common
          shares over a thirty-month period. However, Jaspas may not purchase
          more than 19.9% of the Corporation's common shares issued and
          outstanding as of November 12, 1999, the closing date under the
          Agreement, without obtaining shareholder approval.

          The Agreement establishes what is referred to by the parties as an
          equity drawdown facility. On a monthly basis, the Corporation may
          request a drawdown on the facility subject to a formula, based on the
          average stock price and average trading volume, that sets the maximum
          amount for any given draw. At the end of a 22-day trading period
          following the drawdown request, the amount of money that Jaspas will
          provide to the Corporation and the number of shares that the
          Corporation will issue is settled based on the formula using the
          average daily share price for each of the 22 trading days. Jaspas
          receives a 6% discount on the market price determined for the 22-day
          trading period, and the Corporation will receive the settled amount
          less a 3% placement fee payable to the placement agents.

          The Corporation may make up to 24 drawdowns to a maximum of
          $750,000/drawdown and $12,000,000 in total. There are certain
          conditions that must be satisfied before Jaspas is obligated to
          purchase the Corporation's common shares. In 2000, the Corporation
          issued 290,505 common shares and raised $1,000,000 under this
          facility. In 1999, no drawdown was made by the Corporation.

          The Corporation has also issued a warrant to Jaspas to purchase
          200,000 common shares (see note 6 (d)).

          The gross fees related to this transaction amounted to $242,732 and
          have been accounted for as deferred share issuance costs and are being
          amortized over the thirty-month drawdown period. Amortization is
          calculated for each drawdown based on the percentage of the actual
          drawdown over the total facility. In 2000, the Corporation amortized
          $20,220 of deferred share issuance costs to the deficit.

                                       51
<PAGE>   52
NYMOX PHARMACEUTICAL CORPORATION
Notes to Consolidated Financial Statements, Continued

Years ended December 31, 2000, 1999 and 1998
(in US dollars)

6.   SHARE CAPITAL (CONTINUED):

     (d)  Warrants:

          The Corporation has issued the following warrants to purchase common
          shares:

<TABLE>
<CAPTION>


                         Exercise                                          Outstanding at
                        price per                   Exercised                December 31,
          Warrants          share      Issued         to date    Expired             2000               Expiry
          --------     ----------     -------       ---------    -------   --------------              -------
          <S>          <C>             <C>          <C>          <C>       <C>                          <C>
          Series E         $ 4.53    200,000 (i)         -          -             200,000    November 30, 2004
          Series F         $ 4.06    160,000 (ii)        -          -             160,000    November 30, 2004
          Series G         $ 3.70    115,662 (iii)       -          -             115,662      January 8, 2005
          Series H         $ 9.38     66,667 (iv)        -          -              66,667        March 6, 2004
          Series I         $ 7.81     26,667 (iv)        -          -              26,667        March 6, 2004
          Series J         $ 3.70     42,290 (iii)       -          -              42,290        July 31, 2005

</TABLE>

          (i)   Warrant issued to Jaspas in connection with the common stock
                purchase agreement referred to in note 6 (c). The warrant
                entitles Jaspas to purchase 100,000 common shares at an exercise
                price of US$4.5315. Jaspas may purchase a further 100,000 common
                shares at the same price only if the Corporation has not drawn
                down at least US$7,000,000 within eighteen months from the
                effective date of the agreement.

          (ii)  Warrants issued to placement agents in connection with the
                common stock purchase agreement. The warrants are exercisable at
                a price of US$4.0625.

          (iii) Warrants issued in connection with the Serex acquisition (see
                note 5).

          (iv)  Warrants issued in connection with 2000 private placement (see
                note 6 (b)).

     (e)  Stock options:

          The Corporation has established a stock option plan (the "Plan") for
          its key employees, its officers and directors, and certain
          consultants. The Plan is administered by the Board of Directors of the
          Corporation. The Board may from time to time designate individuals to
          whom options to purchase common shares of the Corporation may be
          granted, the number of shares to be optioned to each, and the option
          price per share. The option price per share cannot involve a discount
          to the market price at the time the option is granted. The total
          number of shares to be optioned to any one individual cannot exceed 5%
          of the total issued and outstanding shares and the maximum number of
          shares which may be optioned under the Plan cannot exceed 2,500,000
          common shares without shareholder approval.


                                       52

<PAGE>   53

NYMOX PHARMACEUTICAL CORPORATION
Notes to Consolidated Financial Statements, Continued

Years ended December 31, 2000, 1999 and 1998
(in US dollars)

6.   SHARE CAPITAL (CONTINUED):

     (e)  Stock options (continued):

          Changes in outstanding options were as follows for the last two fiscal
periods:

<TABLE>
<CAPTION>
                                                                                                     Weighted
                                                                                                      average
                                                                                                     exercise
                                                                                   Number               price
                                                                              -----------         -----------
          <S>                                                                 <C>                 <C>
         Balance, December 31, 1998                                             1,926,000         $      3.97

         Granted                                                                  351,500                3.72

         Exercised                                                                (98,900)               2.25

         Expired                                                                  (55,000)               6.63

         Cancelled                                                               (993,100)               2.30
                                                                              -----------         -----------
         Balance, December 31, 1999                                             1,130,500                4.76

         Granted                                                                  549,000                4.06

         Exercised                                                                 (5,000)               2.20

         Expired                                                                  (10,000)               4.26

         Cancelled                                                                (25,000)               3.12
                                                                              -----------         -----------
         Balance, December 31, 2000                                             1,639,500         $      4.54
                                                                              ===========         ===========
</TABLE>

                                       53



<PAGE>   54

NYMOX PHARMACEUTICAL CORPORATION
Notes to Consolidated Financial Statements, Continued

Years ended December 31, 2000, 1999 and 1998

6.   SHARE CAPITAL (CONTINUED):

     (e) Stock options (continued):

         At December 31, 2000, options outstanding and exercisable were as
follows:

<TABLE>
<CAPTION>
         Options outstanding   Options exercisable     Exercise price per share       Expiry date
         -------------------   -------------------     ------------------------       -----------
         <C>                   <C>                     <C>                                  <C>
               285,000               275,000                   $2.25                January 17, 2006
                20,000                20,000                   $9.53                January 17, 2006
                20,000                20,000                   $6.79                January 17, 2006
                40,000                40,000                   $6.93                January 17, 2006
               100,000               100,000                   $7.97                  April 30, 2006
                10,000                10,000                   11.60                 August 13, 2006
                50,000                10,000                   $6.24                 August 13, 2006
                30,000                30,000                   $6.93                 August 13, 2006
                25,000                25,000                   $6.24                October 31, 2007
                90,000                90,000                   $6.93                October 31, 2007
                 9,000                 9,000                   $6.41               December 19, 2007
               100,000               100,000                   $4.85                November 9, 2008
                50,000                50,000                   $6.93                January 22, 2009
               175,000               145,000                   $3.12                    May 13, 2009
                10,000                10,000                   $6.93                    May 13, 2009
                 3,500                 1,167                   $6.41                    May 13, 2009
                75,000                75,000                   $3.12                    June 1, 2009
                40,000                  -                      $3.70                 January 8, 2009
               308,500               268,500                   $3.87                     May 1, 2010
                50,000                  -                      $6.93                     May 1, 2010
                10,000                10,000                   $4.70                   June 15, 2010
                10,000                10,000                   $3.50                   July 13, 2010
                 2,000                 2,000                   $4.00                   July 13, 2010
                71,500                31,500                   $3.20                 August 14, 2010
                 5,000                  -                      $3.15                 August 16, 2010
                50,000                50,000                   $3.90                 August 25, 2010
             ---------             ---------
             1,639,500             1,382,167
             ---------             ---------
</TABLE>
                                       54

<PAGE>   55

NYMOX PHARMACEUTICAL CORPORATION
Notes to Consolidated Financial Statements, Continued

Years ended December 31, 2000, 1999 and 1998
(in US dollars)

7.   COMMITMENTS AND CONTINGENCY:

     (a)  Operating leases:

          Minimum lease payments under operating leases for the Corporation's
          premises for the next five years are as follows:

<TABLE>
<CAPTION>
          <S>                                                         <C>
          2001                                                         $152,031
          2002                                                          134,394
          2003                                                          104,382
          2004                                                           93,740
          2005                                                           15,623
                                                                       --------
                                                                       $500,170
                                                                       ========
</TABLE>

     (b)  Research funding agreement:

          The Corporation is committed to make research grants to an unrelated
          medical facility in the U.S. in the aggregate amount of approximately
          $215,000 in the next two years as follows:

<TABLE>
<CAPTION>

          <S>                                                         <C>
         2001                                                         $172,000
         2002                                                           43,000
                                                                      --------
                                                                      $215,000
                                                                      ========
</TABLE>

          Under this agreement, the medical facility benefits from research
          funding and collaboration from the Corporation and is entitled to
          royalties based on a percentage of sales of any commercialized product
          derived from this research.

     (c)  Contingency:

          A shareholder has served the Corporation with a Statement of Claim
          filed with the Ontario Superior Court of Justice claiming to be
          entitled to the issuance of 388,797 additional shares in accordance
          with repricing provisions contained in the March 2000 private
          placement agreement referred to in note 6 (b) and to damages for lost
          opportunity to sell these shares. The Corporation believes that the
          shareholder's interpretation of the repricing provisions in the March
          2000 agreement is incorrect and intends to defend the action
          vigorously.
                                       55


<PAGE>   56
NYMOX PHARMACEUTICAL CORPORATION
Notes to Consolidated Financial Statements, Continued

Years ended December 31, 2000, 1999 and 1998
(in US dollars)


8.   INCOME TAXES:

     Details of the components of income taxes are as follows:
<TABLE>
<CAPTION>
                                                                2000                 1999                 1998
                                                                ----                 ----                 ----
<S>                                                        <C>                  <C>                  <C>
     Loss before income taxes:

          Canadian operations                            $(2,558,476)         $(2,631,662)         $(1,782,794)
          U.S. operations                                 (1,465,503)            (682,634)          (3,000,419)
                                                         -----------          -----------          -----------
                                                          (4,023,979)          (3,314,296)          (4,783,213)
     Basic income tax rate                                     38.0%                38.0%                38.0%
                                                         -----------          -----------          -----------
     Income tax recovery at statutory rates                1,529,000            1,260,000            1,817,000

     Adjustments in income taxes resulting from:
          Non-recognition of losses and other
            unclaimed deductions                          (1,529,000)          (1,260,000)          (1,817,000)
                                                         -----------          -----------          -----------
     Income taxes                                        $     -              $    -               $    -
                                                         ===========          ===========          ===========

</TABLE>


     The income tax effect of temporary differences that give rise to the net
     future tax asset is presented below:

<TABLE>
<CAPTION>
                                                                                     2000                 1999
                                                                                     ----                 ----
<S>                                                                           <C>                  <C>
     Non-capital losses                                                       $ 6,695,000          $ 4,918,000

     Scientific research and experimental development
       expenditures                                                               644,000              662,000

     Investment tax credits                                                       350,000              330,000

     Intellectual property rights                                                (805,000)                -

     Less valuation allowance                                                  (6,884,000)          (5,910,000)
                                                                              -----------          -----------
     Net future tax asset                                                     $     -              $      -
                                                                              ===========          ===========
</TABLE>


                                       56

<PAGE>   57

NYMOX PHARMACEUTICAL CORPORATION
Notes to Consolidated Financial Statements, Continued

Years ended December 31, 2000, 1999 and 1998
(in US dollars)

8.   INCOME TAXES (CONTINUED):

     In assessing the realizability of future tax assets, management considers
     whether it is more likely than not that some portion or all of the future
     tax assets will not be realized. The ultimate realization of future tax
     assets is dependent upon the generation of future taxable income and tax
     planning strategies. Since the Corporation is a development stage
     enterprise, the generation of future taxable income is dependent on the
     successful commercialization of its products and technologies.

     The Corporation has non-capital losses carried forward and accumulated
     scientific research and development expenditures which are available to
     reduce future years' taxable income. The related income tax benefit of
     these items will be recorded in earnings when realized. These expire as
     follows:

<TABLE>
<CAPTION>
                                                     Federal          Provincial
                                                   ----------         ----------
<S>                                                <C>                <C>
     Non-capital losses:
          2001                                     $   40,000         $   40,000
          2002                                        637,000                 -
          2003                                      1,379,000            884,000
          2004                                        962,000            755,000
          2005                                      2,095,000          2,096,000
          2006                                      2,435,000          2,435,000
          2007                                      2,417,000          2,417,000

     Scientific research and development
       expenditures: (Indefinitely)                 1,312,000          2,943,000
</TABLE>

     The Corporation also has investment tax credits available in the amount of
     approximately $350,000 to reduce future years' federal taxes payable. The
     benefit of these credits will be recorded when realized. These credits
     expire as follows:

<TABLE>
      <S>                                                             <C>
      2005                                                            $   25,000
      2006                                                               184,000
      2007                                                                98,000
      2008                                                                 3,000
      2009                                                                 8,000
      2010                                                                32,000
</TABLE>

                                       57



<PAGE>   58

NYMOX PHARMACEUTICAL CORPORATION
Notes to Consolidated Financial Statements, Continued

Years ended December 31, 2000, 1999 and 1998
(in US dollars)


8.   INCOME TAXES (CONTINUED):

     In addition, the Corporation's US subsidiaries have losses carried forward
     of approximately $6,840,000 which expire as follows:

<TABLE>
     <S>                          <C>
     2011                         $  460,000
     2012                          1,730,000
     2018                          2,700,000
     2019                            950,000
     2020                          1,000,000
</TABLE>

9.   FINANCIAL INSTRUMENTS:

     (a)  Foreign currency risk management:

          As indicated in note 2 (a), the Corporation has adopted the US dollar
          as its measurement currency effective January 1, 2000 because a
          substantial portion of revenues, expenses, assets and liabilities of
          its Canadian and US operations are denominated in US dollars. The
          Canadian operation also has transactions denominated in Canadian
          dollars, principally relating to salaries and rent. The Corporation
          does not engage in the use of derivative financial instruments to
          manage its currency exposures. Fluctuations in payments made for the
          payment of the Corporation's expenses denominated in currencies other
          than the US dollar could cause unanticipated fluctuations in the
          Corporation's operating results.

     (b)  Fair value disclosure:

          The Corporation has determined that the carrying value of its
          short-term financial assets and liabilities approximates fair value
          due to the immediate or short-term maturity of these financial
          instruments.

                                       58
<PAGE>   59

NYMOX PHARMACEUTICAL CORPORATION
Notes to Consolidated Financial Statements, Continued

Years ended December 31, 2000, 1999 and 1998
(in US dollars)


10.  CANADIAN/U.S. REPORTING DIFFERENCES:

     (a)  Consolidated statements of earnings:

          The reconciliation of earnings reported in accordance with Canadian
          GAAP and with U.S. GAAP is as follows:
<TABLE>
<CAPTION>
                                                                    2000            1999            1998
                                                             -----------     -----------     -----------
<S>                                                          <C>             <C>             <C>
          Net loss, Canadian GAAP                            $(4,023,979)    $(3,314,296)    $(4,783,213)

          Adjustments:
               Amortization of patents (i)                         9,361           9,142         (50,622)
               Stock-based compensation - options
                 granted to non-employees (ii)                  (257,690)       (198,815)       (274,088)
               Change in reporting currency (iii)                     -           94,803         128,361
                                                             -----------     -----------     -----------
          Net loss, U.S. GAAP                                $(4,272,308)    $(3,409,166)    $(4,979,562)
                                                             ===========     ===========     ===========
          Loss per share, U.S. GAAP                          $     (0.20)    $     (0.17)    $     (0.26)
                                                             ===========     ===========     ===========
</TABLE>

     (b)  Consolidated shareholders' equity:

          The reconciliation of shareholders' equity reported in accordance with
          Canadian GAAP and with U.S. GAAP is as follows:

<TABLE>
<CAPTION>
                                                                    2000            1999            1998
                                                             -----------     -----------     -----------
<S>                                                        <C>               <C>             <C>
          Shareholders' equity, Canadian GAAP              $   3,260,942     $ 1,307,147     $ 3,687,231

          Adjustments:
               Amortization of patents (i)                      (147,946)       (157,307)       (176,549)
               Stock-based compensation - options
                 granted to non-employees (ii):
                   Cumulative compensation expense            (1,205,543)       (947,853)       (792,788)
                   Additional paid-in capital                  1,258,106       1,000,416         749,038
               Change in reporting currency (iii)                (62,672)        (62,672)       (162,580)
                                                             -----------     -----------     -----------
                                                                (158,055)       (167,416)       (382,879)
                                                             -----------     -----------     -----------
          Shareholders' equity, U.S. GAAP                    $ 3,102,887     $ 1,139,731     $ 3,304,352
                                                             ===========     ===========     ===========
</TABLE>

                                       59

<PAGE>   60

NYMOX PHARMACEUTICAL CORPORATION
Notes to Consolidated Financial Statements, Continued

Years ended December 31, 2000, 1999 and 1998
(in US dollars)


10.  CANADIAN/U.S. REPORTING DIFFERENCES (CONTINUED):

     (b)  Consolidated shareholders' equity:

         (i)   In accordance with APB Opinion 17, Intangible Assets, the patents
               are amortized using the straight-line method over the legal life
               of the patents from the date the patent was secured. For Canadian
               GAAP purposes, patents are amortized commencing in the year of
               commercial production of the developed products.

         (ii)  In accordance with FAS 123, Accounting for Stock-Based
               Compensation, compensation related to the stock options granted
               to non-employees has been recorded in the accounts based on the
               fair value of the stock options at the grant date. The fair value
               of the stock options was estimated as described in note 10 (d)
               (2). There are no comparable Canadian standards.

         (iii) Change in reporting currency:

               As explained in note 2 (a), the Company has adopted the US dollar
               as its reporting currency effective January 1, 2000. For Canadian
               GAAP purposes, the financial information for 1999 and 1998 has
               been translated into US dollars at the December 31, 1999 exchange
               rate. For United States GAAP reporting purposes, assets and
               liabilities for all years presented have been translated into US
               dollars at the ending exchange rate for the respective year and
               the statement of earnings at the average exchange rate for the
               respective year.

     (c)  Consolidated comprehensive income:
<TABLE>
<CAPTION>
                                                                 2000             1999             1998
                                                           ----------      -----------      -----------
<S>                                                        <C>              <C>             <C>

          Net loss, US GAAP                               $(4,272,308)     $(3,409,166)     $(4,979,562)

          Other comprehensive income (loss):
               Foreign currency translation
                 adjustment                                        -           111,518           (8,733)
                                                          -----------      -----------      -----------
          Comprehensive loss                              $(4,272,308)     $(3,297,648)     $(4,988,295)
                                                          ===========      ===========      ===========
</TABLE>

          FAS 130, Reporting Comprehensive Income, requires the Corporation to
          report and display certain information related to comprehensive income
          for the Corporation. Comprehensive income includes net earnings and
          certain foreign currency translation adjustments.

          The accumulated comprehensive loss only comprises foreign currency
          translation adjustments and is included in the amount of shareholders'
          equity presented for US GAAP purposes in note 10 (b).

                                       60


<PAGE>   61

NYMOX PHARMACEUTICAL CORPORATION
Notes to Consolidated Financial Statements, Continued

Years ended December 31, 2000, 1999 and 1998
(in US dollars)

10.  CANADIAN/U.S. REPORTING DIFFERENCES (CONTINUED):

     (d) Other disclosures required by United States GAAP:

         (1)   Development stage company:

               The Corporation is in the process of developing unique patented
               products which are subject to approval by the regulatory
               authorities. It has had limited revenues to date on the sale of
               its products under development. Accordingly, the Corporation is a
               development stage company as defined in Statement of Financial
               Accounting Standards No. 7 and the following additional
               disclosures are provided:

<TABLE>
<CAPTION>
                                                                               Cumulative           Cumulative
                                                                        since the date of    since the date of
                                                                             inception of         inception of
                                                                          the Corporation      the Corporation
                                                                          to December 31,      to December 31,
                                                                                     2000                 1999
                                                                        -----------------     ----------------
               <S>                                                             <C>               <C>
              Interest revenue                                               $    484,150         $    415,971

              Service fees                                                        432,776              275,088

              Gross research and development expenditures                       8,936,120            7,460,818

              Other expenses                                                   12,054,382            9,269,381

              Cash inflows (outflows):
                  Operating activities                                        (18,918,110)         (15,058,838)
                  Investing activities                                           (513,063)            (204,495)
                  Financing activities                                         21,437,303           17,153,115
                                                                             ============         ============
</TABLE>
                                       61



<PAGE>   62
NYMOX PHARMACEUTICAL CORPORATION
Notes to Consolidated Financial Statements, Continued

Years ended December 31, 2000, 1999 and 1998
(in US dollars)

10.  CANADIAN/U.S. REPORTING DIFFERENCES (CONTINUED):

     (d)  Other disclosures required by United States GAAP (continued):

          (1)  Development stage company (continued):

               The statement of shareholders' equity since date of inception is
               presented below.

<TABLE>
<CAPTION>
                                                                                Additional
                                                      Number of        Consi-      paid-in    Accumulated
                                                         shares      deration      capital        deficit           Total
                                                      ---------     ----------    ---------    -----------     -----------
<S>                                                    <C>            <C>         <C>           <C>             <C>
               Year ended July 31, 1990:

                  Common shares issued                2,500,000     $  172,414   $   -        $     -         $   172,414
                  Net loss                                 -              -          -           (109,241)       (109,241)
                                                      ---------     ----------   ---------    -----------     -----------
                  Balance, July 31, 1990              2,500,000        172,414       -           (109,241)         63,173

               Year ended July 31, 1991:
                  Net loss                                 -              -          -            (21,588)        (21,588)
                  Cumulative translation adjustment        -             1,499       -               (950)            549
                                                      ---------     ----------   ---------    -----------     -----------
                  Balance, July 31, 1991              2,500,000        173,913       -           (131,779)         42,134

               Year ended July 31, 1992:
                  Common shares issued                    9,375         31,468       -               -             31,468
                  Net loss                                 -              -          -            (45,555)        (45,555)
                  Cumulative translation adjustment        -            (6,086)      -              5,598            (488)
                                                      ---------     ----------   ---------    -----------     -----------
                  Balance, July 31, 1992              2,509,375        199,295       -           (171,736)         27,559

               Year ended July 31, 1993:
                  Common shares issued                  201,250        159,944       -               -            159,944
                  Common shares cancelled              (500,000)         -           -               -               -
                  Net loss                                -              -           -            (38,894)        (38,894)
                  Cumulative translation adjustment       -            (13,994)      -             12,830          (1,164)
                                                      ---------     ----------   ---------    -----------     -----------
                  Balance, July 31, 1993              2,210,625        345,245       -           (197,800)        147,445

               Year ended July 31, 1994:
                  Common shares issued                    2,500          7,233       -               -              7,233
                  Net loss                                -              -           -            (53,225)        (53,225)
                  Cumulative translation adjustment       -            (25,173)      -             15,808          (9,365)
                                                      ---------     ----------   ---------    -----------     -----------
                  Balance, July 31, 1994              2,213,125        327,305       -           (235,217)         92,088

               Year ended July 31, 1995:
                  Common shares issued                   78,078        303,380       -               -            303,380
                  Net loss                                -              -           -           (285,910)       (285,910)
                  Cumulative translation adjustment       -              5,196       -             (7,221)         (2,025)
                                                      ---------     ----------   ---------    -----------     -----------
                  Balance, July 31, 1995              2,291,203        635,881       -           (528,348)        107,533

               Period ended December 31, 1995:
                  Adjustment necessary to
                    increase the number of
                    common shares                    12,708,797          -           -               -              -
                                                      ---------     ----------   ---------    -----------     -----------
                  Adjusted number of
                    common shares                    15,000,000        635,881       -           (528,348)        107,533
                  Common shares issued                2,047,082      2,997,284       -               -          2,997,284
                  Net loss                                -              -           -         (1,194,226)     (1,194,226)
                  Share issue costs                       -           (153,810)      -               -           (153,810)
                  Cumulative translation adjustment       -              2,858       -             (6,328)         (3,470)
                                                      ---------     ----------   ---------    -----------     -----------
                  Balance, December 31, 1995
                    carried forward                  17,047,082      3,482,213       -         (1,728,902)      1,753,311

</TABLE>
                                       62
<PAGE>   63
NYMOX PHARMACEUTICAL CORPORATION
Notes to Consolidated Financial Statements, Continued

Years ended December 31, 2000, 1999 and 1998
(in US dollars)

10.  CANADIAN/U.S. REPORTING DIFFERENCES (CONTINUED):

     (d) Other disclosures required by United States GAAP (continued):

         (1)  Development stage company (continued):

              The statement of shareholders' equity since date of inception is
              presented below (continued).

<TABLE>
<CAPTION>

                                                                                   Additional
                                                      Number of        Consi-         paid-in      Accumulated
                                                         shares      deration         capital          deficit         Total
                                                      ---------      --------     -----------      -----------         -----
<S>                                                  <C>            <C>           <C>              <C>              <C>
              Balance, December 31, 1995
                brought forward                      17,047,082     $3,482,213    $     -          $(1,728,902)     $ 1,753,311

              Year ended December 31, 1996:
                  Common shares issued                  882,300      3,852,364          -                -            3,852,364
                  Net loss                                -              -              -           (3,175,587)      (3,175,587)
                  Share issue costs                       -           (170,699)         -                -             (170,699)
                  Stock-based compensation                -              -            434,145            -              434,145
                  Cumulative translation adjustment       -            (16,769)        (2,217)          24,544            5,558
                                                     ----------    -----------     ----------      -----------      -----------
              Balance, December 31, 1996             17,929,382      7,147,109        431,928       (4,879,945)       2,699,092

              Year ended December 31, 1997:
                  Common shares issued                  703,491      3,180,666          -                -            3,180,666
                  Net loss                                -              -              -           (3,755,409)      (3,755,409)
                  Share issue costs                       -           (161,482)         -                -             (161,482)
                  Capital stock subscription              -            352,324          -                -              352,324
                  Stock-based compensation                -              -            108,350            -              108,350
                  Cumulative translation adjustment       -           (299,275)       (21,578)         325,364            4,511
                                                     ----------    -----------     ----------      -----------      -----------
                  Balance, December 31, 1997         18,632,873     10,219,342        518,700       (8,309,990)       2,428,052

              Year ended December 31, 1998:
                  Common shares issued                1,095,031      5,644,638          -                -            5,644,638
                  Net loss                                -              -              -           (4,979,562)      (4,979,562)
                  Share issue costs                       -            (54,131)         -                -              (54,131)
                  Stock-based compensation                -              -            274,088            -              274,088
                  Cumulative translation adjustment       -           (685,156)       (43,750)         720,173           (8,733)
                                                     ----------    -----------     ----------      -----------      -----------
              Balance, December 31, 1998             19,727,904     15,124,693        749,038      (12,569,379)       3,304,352

              Year ended December 31, 1999:
                  Common shares issued                  275,900        969,253          -               -               969,253
                  Net loss                                -              -              -           (3,409,166)      (3,409,166)
                  Share issue costs                       -            (35,041)         -               -               (35,041)
                  Stock-based compensation                -              -            198,815           -               198,815
                  Cumulative translation adjustment       -            943,133         52,563         (884,178)         111,518
                                                     ----------    -----------     ----------      -----------      -----------
              Balance, December 31, 1999             20,003,804     17,002,038      1,000,416      (16,862,723)       1,139,731

              Year ended December 31, 2000:
                  Common shares issued                1,373,817      5,909,340          -              -              5,909,340
                  Warrants and options                    -            421,638          -              -                421,638
                  Net loss                                -              -              -           (4,272,308)      (4,272,308)
                  Share issue costs                       -           (353,204)         -              -               (353,204)
                  Stock-based compensation                -              -            257,690          -                257,690
                                                     ----------    -----------     ----------     ------------      -----------
              Balance, December 31, 2000             21,377,621    $22,979,812     $1,258,106     $(21,135,031)     $ 3,102,887
                                                     ==========    ===========     ==========     ============      ===========
</TABLE>
                                       63
<PAGE>   64
NYMOX PHARMACEUTICAL CORPORATION
Notes to Consolidated Financial Statements, Continued

Years ended December 31, 2000, 1999 and 1998
(in US dollars)

10.  CANADIAN/U.S. REPORTING DIFFERENCES (CONTINUED):

     (d)  Other disclosures required by United States GAAP (continued):

          (2)  Stock-based compensation:

               For US GAAP purposes, the Corporation applies APB Opinion 25,
               Accounting for Stock Issued to Employees, in accounting for its
               stock option plan, and accordingly, no compensation cost has been
               recognized for stock options granted to employees in these
               financial statements. As explained in note 10 (b), compensation
               cost has been recognized for stock options granted to
               non-employees. Had compensation cost been determined for stock
               options granted to employees based on the fair value at the grant
               dates for awards under the plan consistent with the method of
               FASB Statement 123, Accounting for Stock-Based Compensation, the
               Corporation's net earnings and loss per share would have been
               adjusted to the pro-forma amounts indicated below for US GAAP:

<TABLE>
<CAPTION>

                                                                                        2000             1999
                                                                                 -----------      -----------
               <S>                          <C>               <C>                <C>              <C>
               Net loss                     As reported       (US GAAP)          $(4,272,308)     $(3,409,166)
                                            Pro-forma                             (5,884,919)      (3,990,187)

               Loss per share               As reported       (US GAAP)                (0.20)           (0.17)
                                            Pro-forma                                  (0.28)           (0.20)

</TABLE>


               The fair value of each option grant was estimated on the date of
               grant using the Black-Scholes option-pricing model with the
               following weighted-average assumptions: risk-free interest rate
               of 5.49% (1999 - 5.5%), dividend yield of 0%, expected volatility
               of 163% (1999 - 80%), and expected life of 5 years.

                                       64
<PAGE>   65

NYMOX PHARMACEUTICAL CORPORATION
Notes to Consolidated Financial Statements, Continued

Years ended December 31, 2000, 1999 and 1998
(in US dollars)


11.  SEGMENT DISCLOSURES:

     Geographic segment information was as follows:
<TABLE>
<CAPTION>
                                                                         United
                                                    Canada               States
                                               -----------          -----------
     <S>                                        <C>                   <C>
     Revenues:
         2000                                  $    68,179          $   157,688
         1999                                       40,963              149,240
         1998                                      168,761              104,804

     Net loss:
         2000                                   (2,558,476)          (1,465,503)
         1999                                   (2,631,662)            (682,634)
         1998                                   (1,782,794)          (3,000,419)

     Identifiable assets:
         2000                                    4,110,466              408,172
         1999                                    1,714,416              426,075
         1998                                    3,422,944              565,291
</TABLE>

12.  SUBSEQUENT EVENT:

     In February 2001, the Corporation issued 161,696 common shares for gross
     proceeds of $327,273 under the equity drawdown facility referred to in note
     6 (c).

                                       65


<PAGE>   66

ITEM 9.  OFFER AND LISTING DETAILS

Nymox's common shares trade on the Nasdaq Stock Market. Nymox's common shares
traded on the Nasdaq National Market from December 1, 1997 until September 16,
1999 when they began trading on the Nasdaq SmallCap Market. Nymox's common
shares also traded on the Montreal Exchange from December 18, 1995 until
November 19, 1999.

The following tables set out the high and low reported trading prices of the
common shares on the Nasdaq Stock Market during the periods indicated.


ANNUAL HIGH AND LOW MARKET PRICES - PAST FIVE YEARS
<TABLE>
<CAPTION>
Year                          Annual High                             Annual Low
----                          -----------                             ----------
<S>                             <C>                                     <C>
1996                            $13.850                                 $1.950
1997                            $10.750                                 $6.250
1998                            $13.625                                 $2.500
1999                            $ 5.875                                 $2.500
2000                            $10.563                                 $1.063
2001                            $ 3.000                                 $1.750
</TABLE>


QUARTERLY HIGH AND LOW MARKET PRICES - PAST TWO YEARS
<TABLE>
<CAPTION>
Year             Quarterly Period        High Sales Price        Low Sales Price
----             ----------------        ----------------        ---------------
<S>                 <C>                       <C>                    <C>
1999                1st Quarter               $5.875                 $2.875
                    2nd Quarter               $4.188                 $2.750
                    3rd Quarter               $4.750                 $2.500
                    4th Quarter               $4.625                 $2.500
2000                1st Quarter               $10.563                $2.625
                    2nd Quarter               $5.875                 $2.625
                    3rd Quarter               $6.063                 $2.906
                    4th Quarter               $3.875                 $1.063
2001                1st Quarter               $3.000                 $1.750
</TABLE>


MONTHLY HIGH AND LOW MARKET PRICES - MOST RECENT SIX MONTHS
<TABLE>
<CAPTION>
    Date                           Monthly High                      Monthly Low
--------------                     ------------                      -----------
<S>                                   <C>                              <C>
 October, 2000                        $3.875                           $2.531
November, 2000                        $3.031                           $1.250
December, 2000                        $2.750                           $1.063
 January, 2001                        $3.000                           $1.813
February, 2001                        $2.563                           $1.750
   March, 2001                        $2.625                           $1.875
</TABLE>

                                       66
<PAGE>   67

ITEM 10.  ADDITIONAL INFORMATION

WARRANTS OUTSTANDING
<TABLE>
<CAPTION>
Description           Warrants Issued       Exercise Price          Expiry Date
-----------           ---------------       --------------          ------------
<S>                       <C>                   <C>                 <C>
Series K                  100,000               $2.06                Mar 6, 2003
Series H                   66,667               $9.375               Mar 6, 2004
Series I                   26,667               $7.8125              Mar 6, 2004
Series E                  200,000               $4.5315             Nov 30, 2004
Series F                  160,000               $4.0625             Nov 30, 2004
Series G                  109,879               $3.70                Jan 8, 2005
Series G                    5,783               $3.70                Jan 8, 2005
Series J                   42,290               $3.70               Jul 31, 2005
</TABLE>

The total number of shares subject to options at March 31, 2001 is 1,649,500, of
which options representing 1,418,167 are currently exercisable. Of those, the
total number of shares subject to options held by directors and officers of
Nymox is 845,000 of which options representing 715,000 shares are currently
exercisable.

There are no rights, warrants or options presently outstanding under which Nymox
could issue additional common shares, with the exception of options enabling
certain directors, employees and consultants of Nymox to acquire common shares
under Nymox's stock option plan and of warrants entitling the holders to acquire
up to 711,286 common shares of Nymox as outlined in the above table.

MEMORANDUM AND ARTICLES OF ASSOCIATION

BYLAWS AND ARTICLES OF INCORPORATION

The company's Articles of Incorporation as amended, which we refer to as our
articles of incorporation, are on file with the Corporations Directorate of
Industry Canada under Corporation Number 315235-9. Our articles of incorporation
do not include a stated purpose and do not place any restrictions on the
business that the company may carry on.

DIRECTORS

A director of our company need not be a shareholder. In accordance with our
bylaws and the Canada Business Corporations Act, a majority of our directors
must be residents of Canada. In order to serve as a director, a person must be a
natural person at least 18 years of age, of sound mind and not bankrupt. Neither
our articles of incorporation or by-laws, nor the Canada Business Corporations
Act, impose any mandatory retirement requirements for directors.

A director who is a party to, or who is a director or officer of or has a
material interest in any person who is a party to, a material contract or
transaction or proposed material contract or transaction with our company must
disclose to the company the nature and extent of his or her

                                       67
<PAGE>   68
interest at the time and in the manner provided by the Canada Business
Corporations Act. The Canada Business Corporations Act prohibits such a director
from voting on any resolution to approve the contract or transaction unless the
contract or transaction:

     -   is an arrangement by way of security for money lent to or obligations
         undertaken by the director for the benefit of the company or an
         affiliate;

     -   relates primarily to his or her remuneration as a director, officer,
         employee or agent of the company or an affiliate;

     -   is for indemnity or insurance for director's liability as permitted by
         the Act; or

     -   is with an affiliate.

Our board of directors may, on behalf of the company and without authorization
of our shareholders:

     -   borrow money upon the credit of the company;

     -   issue, reissue, sell or pledge debt obligations of the company;

     -   give a guarantee on behalf of the company to secure performance of an
         obligation of any person; and

     -   mortgage, hypothecate, pledge or otherwise create a security interest
         in all or any property of the company, owned or subsequently acquired,
         to secure any obligation of the company.

The Canada Business Corporations Act prohibits the giving of a guarantee to any
shareholder, director, officer or employee of the company or of an affiliated
corporation or to an associate of any such person for any purpose or to any
person for the purpose of or in connection with a purchase of a share issued or
to be issued by the company or its affiliates, where there are reasonable
grounds for believing that the company is or, after giving the guarantee, would
be unable to pay its liabilities as they become due, or the realizable value of
the company's assets in the form of assets pledged or encumbered to secure a
guarantee, after giving the guarantee, would be less than the aggregate of the
company's liabilities and stated capital of all classes.

These borrowing powers may be varied by the company's bylaws or its articles of
incorporation. However, our bylaws and articles of incorporation do not contain
any restrictions on or variations of these borrowing powers.

COMMON SHARES

Our articles of incorporation authorize the issuance of an unlimited number of
common shares. They do not authorize the issuance of any other class of shares.

                                       68
<PAGE>   69
The holders of the common shares of our Company are entitled to receive notice
of and to attend all meetings of the shareholders of our Company and have one
vote for each common share held at all meetings of the shareholders of our
Company. Our directors are elected at each annual meeting of shareholders and do
not stand for reelection at staggered intervals.

The holders of common shares are entitled to receive dividends and our company
will pay dividends, as and when declared by our board of directors, out of
moneys properly applicable to the payment of dividends, in such amount and in
such form as our board of directors may from time to time determine, and all
dividends which our board of directors may declare on the common shares shall be
declared and paid in equal amounts per share on all common shares at the time
outstanding.

In the event of the dissolution, liquidation or winding-up of the company,
whether voluntary or involuntary, or any other distribution of assets of the
company among its shareholders for the purpose of winding up its affairs, the
holders of the common shares will be entitled to receive the remaining property
and assets of the company.

ACTION NECESSARY TO CHANGE RIGHTS OF SHAREHOLDERS

In order to change the rights of our shareholders, we would need to amend our
articles of incorporation to effect the change. Such an amendment would require
the approval of holders of two-thirds of the shares cast at a duly called
special meeting. For certain amendments such as those creating of a class of
preferred shares, a shareholder is entitled to dissent in respect of such a
resolution amending our articles and, if the resolution is adopted and the
company implements such changes, demand payment of the fair value of its shares.

MEETINGS OF SHAREHOLDERS

An annual meeting of shareholders is held each year for the purpose of
considering the financial statements and reports, electing directors, appointing
auditors and for the transaction of other business as may be brought before the
meeting. The board of directors has the power to call a special meeting of
shareholders at any time.

Notice of the time and place of each meeting of shareholders must be given not
less than 21 days, nor more than 50 days, before the date of each meeting to
each director, to the auditor and to each shareholder who at the close of
business on the record date for notice is entered in the securities register as
the holder of one or more shares carrying the right to vote at the meeting.
Notice of meeting of shareholders called for any other purpose other than
consideration of the minutes of an earlier meeting, financial statements and
auditor's report, election of directors and reappointment of the incumbent
auditor, must state the nature of the business in sufficient detail to permit
the shareholder to form a reasoned judgment on and must state the text of any
special resolution or by-law to be submitted to the meeting.

The only persons entitled to be present at a meeting of shareholders are those
entitled to vote, the directors of the company and the auditor of the company.
Any other person may be admitted only on the invitation of the chairman of the
meeting or with the consent of the meeting. In

                                       69
<PAGE>   70
circumstances where a court orders a meeting of shareholders, the court may
direct how the meeting may be held, including who may attend the meeting.

LIMITATIONS ON RIGHT TO OWN SECURITIES

Neither Canadian law nor our articles or by-laws limit the right of a
nonresident to hold or vote our shares, other than as provided in the Investment
Canada Act (the "Investment Act"), as amended by the World Trade Organization
Agreement Implementation Act. The Investment Act generally prohibits
implementation of a direct reviewable investment by an individual, government or
agency thereof, corporation, partnership, trust or joint venture that is not a
"Canadian," as defined in the Investment Act (a "non-Canadian"), unless, after
review, the minister responsible for the Investment Act is satisfied that the
investment is likely to be of net benefit to Canada. An investment in our shares
by a non-Canadian (other than a "WTO Investor," as defined below) would be
reviewable under the Investment Act if it were an investment to acquire direct
control of our company, and the value of the assets of our company were CDN$5.0
million or more (provided that immediately prior to the implementation of the
investment our company was not controlled by WTO Investors). An investment in
our shares by a WTO Investor (or by a non-Canadian other than a WTO Investor if,
immediately prior to the implementation of the investment our company was
controlled by WTO Investors) would be reviewable under the Investment Act if it
were an investment to acquire direct control of our company (in 2001) and the
value of the assets of our company equaled or exceeded CDN$209.0 million. A
non-Canadian, whether a WTO Investor or otherwise, would be deemed to acquire
control of our company for purposes of the Investment Act if he or she acquired
a majority of the our shares. The acquisition of less than a majority, but at
least one-third of our shares, would be presumed to be an acquisition of control
of our company, unless it could be established that we were not controlled in
fact by the acquirer through the ownership of our shares. In general, an
individual is a WTO Investor if he or she is a "national" of a country (other
than Canada) that is a member of the World Trade Organization ("WTO Member") or
has a right of permanent residence in a WTO Member. A corporation or other
entity will be a "WTO Investor" if it is a "WTO investor-controlled entity,"
pursuant to detailed rules set out in the Investment Act. The United States is a
WTO Member. Certain transactions involving our shares would be exempt from the
Investment Act, including:

    (a)  an acquisition of our shares if the acquisition were made in the
         ordinary course of that person's business as a trader or dealer in
         securities;

    (b)  an acquisition of control of our company in connection with the
         realization of a security interest granted for a loan or other
         financial assistance and not for any purpose related to the provisions
         of the Investment Act; and

    (c)  an acquisition of control of our company by reason of an amalgamation,
         merger, consolidation or corporate reorganization, following which the
         ultimate direct or indirect control in fact of our company, through the
         ownership of voting interests, remains unchanged.

                                       70
<PAGE>   71


CHANGE OF CONTROL

There are no provisions of our bylaws or articles of incorporation that would
have an effect of delaying, deferring or preventing a change in control of the
company and that would operate only with respect to a merger, acquisition or
corporate restructuring involving the company. Our bylaws do not contain a
provision governing the ownership threshold above which shareholder ownership
must be disclosed.

MATERIAL CONTRACTS

The following is a summary of our company's material contracts, entered into
since January 1, 1999.

1.   The Common Stock Purchase Agreement and Registration Rights Agreement
     between Nymox Pharmaceutical Corporation and Jaspas Investments Limited
     dated November 1, 1999. (incorporated by reference to Exhibit 2.0 to the
     Company's form F-1 registration statement filed with the Commission
     February 29, 2000.) These agreements established a $12 million equity line
     of credit which, on March 14, 2000, we became entitled to draw down on. The
     terms and conditions of the equity line of credit are further described in
     the LIQUIDITY AND CAPITAL RESOURCES section in Item 5 above and in more
     detail in our F-1 Registration Statement filed with the SEC on February 29,
     2000 and declared effective on March 14, 2000.

2.   The Research and License Agreement between Rhode Island Hospital
     Corporation and Nymox Corporation dated May 20, 1999. Under this agreement,
     Nymox sponsors the research of two principal investigators, Dr. Suzanne de
     la Monte and Dr. Jack Wands, pertaining to the use of neural thread protein
     for diagnostic or therapeutic purposes in return for licensing rights to
     inventions and patents arising out of this research. The sponsorship
     obligations run for three years from March 1, 1999.

3.   The Share Purchase Agreement between Nymox Pharmaceutical Corporation and
     Dr. Judith Fitzpatrick dated January 8, 2000. Under this agreement which
     closed on March 2, 2000, we acquired 1,008,250 shares of the common stock
     of Serex, Inc. which represented a majority interest of that company in
     return for the issuance of 187,951 of our shares and warrants (Series G) to
     purchase 115,662 of our shares at a strike price of $3.70.

4.   The Employment Agreement between Nymox Pharmaceutical Corporation and Dr.
     Judith Fitzpatrick dated January 8, 2000. Under this agreement Nymox
     employed Dr. Fitzpatrick for four years as a Vice-President of Nymox at a
     salary and with benefits commensurate with that position.

5.   The Common Stock and Warrants Purchase Agreement dated March 6, 2000
     between Nymox Pharmaceutical Corporation and Amro International, S.A.
     ("Amro"). Under this Agreement, Amro purchased 666,667 shares of Nymox and
     warrants to purchase up to 66,667 shares of Nymox at a strike price of
     $9.375 for $4 million. The Agreement

                                       71

<PAGE>   72
     provided Amro with two opportunities to reprice a portion of the 666,667
     shares it initially purchased. Pursuant to these two repricing obligations,
     Nymox issued Amro a further 154,970 shares.

EXCHANGE CONTROLS

Canada has no system of exchange controls. There are no exchange restrictions on
borrowing from foreign countries or on the remittance of dividends, interest,
royalties and similar payments, management fees, loan repayments, settlement of
trade debts or the repatriation of capital.

There are no limitations on the rights of non-Canadians to exercise voting
rights on their shares of Nymox.

TAXATION

UNITED STATES FEDERAL INCOME TAXATION

The following is, as of the date of this annual report, a general summary of the
material U.S. federal income tax consequences that are applicable to the
following persons who may, directly or indirectly, acquire common shares of
Nymox and hold such common shares as capital assets:

     -    citizens or residents (as specially defined for federal income tax
          purposes) of the United States,

     -    corporations or partnerships created or organized in the United States
          or under the laws of the United States or any state,

     -    estates the income of which is subject to the United States federal
          income taxation regardless of its source and

     -    a trust, if a U.S. court is able to exercise primary supervision over
          the administration of such trust and one or more U.S. persons have the
          authority to control all substantial decisions of such trust or a
          trust that has been elected to be treated as a domestic trust (U.S.
          Shareholders).

This discussion does not deal with:

     -    any aspects of federal income taxation that may be relevant to a
          particular U.S. Shareholder based on his particular circumstances
          (including potential application of the alternative minimum tax or
          unrelated business income tax),

     -    certain U.S. Shareholders subject to special treatment under the
          federal income tax laws or foreign individuals or entities,

                                       72


<PAGE>   73
     -    U.S. Shareholders owning directly or by attribution 10% or more of the
          common shares or

     -    any aspect of state, local or non-United States tax laws.

DIVIDENDS PAID ON COMMON SHARES

Subject to the application of the rules relating to a "passive foreign
investment company", referred to as a PFC, distributions paid on common shares
(including any Canadian taxes withheld) to a U.S. Shareholder will be treated as
ordinary income for United States federal income tax purposes to the extent of
Nymox's current and accumulated earnings and profits (as computed for U.S.
federal income tax purposes). Distributions in excess of such earnings and
profits will be applied against the U.S. shareholders tax basis in common
shares, and any distributions in excess of such tax basis will be treated as
gain from the sale or exchange of such common shares. Distributions from Nymox
generally will not qualify for the United States dividends-received deduction
available to corporations. Canadian withholding tax withheld or paid will be
eligible for credit or, at the U.S. Shareholder's election, deduction, subject
to generally applicable limitations.

DISPOSITION OF COMMON SHARES

Subject to the applicable PFC rules discussed below, if a U.S. Shareholder holds
common shares as a capital asset, any gain or loss on a sale or exchange of such
shares will be capital gain or loss, which will be long-term capital gain or
loss if the holding period is one year or more. Generally, the maximum tax rate
for U.S. shareholders who are individuals on long term capital gain is 20%. The
sale of common shares through certain brokers will be subject to the information
reporting and back-up withholding rules of the United States Internal Revenue
Code of 1986, as amended, referred to as the Code.

PASSIVE FOREIGN INVESTMENT COMPANY

For any taxable year of Nymox, if at least 75% of Nymox's gross income is
"passive income" as defined in the Code, or if at least 50% of Nymox's assets,
by average fair market value, are assets that produce or are held for the
production of passive income, Nymox will be a PFC. The PFC determination is made
on the basis of facts and circumstances that may be beyond Nymox's control. It
is not possible to express an opinion as to whether or not Nymox is or will be a
PFC in its current or future taxable years because this depends on, among other
things, the amount and type of gross income that Nymox will earn in the future
and the characterization of certain assets as passive or active, which
determination cannot be made until the facts are known.

If Nymox is a PFC for any taxable year during which a U.S. Shareholder owns,
directly or indirectly, any common shares, the U.S. Shareholder will be subject
to special U.S. federal income tax rules, set forth in Sections 1291 to 1297 of
the Code, with respect to all of such U.S. Shareholder's common shares. In the
absence of (i) an election by such U. S. Shareholder to treat Nymox as a
"qualified electing fund" (the "Q.E.F. Election"), as discussed below, or (ii)
the election to mark to market the common shares (the "Mark to Market
Election"), as described

                                       73
<PAGE>   74
below, the U.S. Shareholder would be required to report any gain on the
disposition of any common shares as ordinary income rather than capital gain and
to compute the tax liability on such gain as well as on any "excess
distribution" as defined in the Code, as if such amounts generally had been
earned pro-rata over the U.S. Shareholder's holding period for such common
shares and were subject to the highest ordinary income tax rate for each taxable
year of the U.S. Shareholder during such holding period. Such U.S. Shareholder
would also be liable for interest, which may be non-deductible by certain U.S.
Shareholders, on the foregoing tax liability as if such liability had been due
with respect to each such prior year. In addition, gifts, exchanges pursuant to
corporate reorganizations and the use of common shares as security for a loan
may be treated as taxable dispositions, and a stepped-up basis upon the death of
such a U.S. Shareholder may not be available.

The foregoing rules may be avoided if a Q.E.F. Election is in effect with
respect to a U. S. Shareholder for each of the years that Nymox is a PFC during
such U.S. Shareholder's holding period. A Q.E.F. Election may be made by a U.S.
Shareholder on or before the due date, including extensions, for filing such
U.S. Shareholder's tax return for such taxable year. Such a U.S. Shareholder
would be taxed on its pro-rata share of Nymox's earnings and profits for Nymox's
taxable year in which it was, or was treated as, a PFC and which ends with or
within such U.S. Shareholder's taxable year, regardless of whether such amounts
are actually distributed by Nymox. This may result in tax liability without a
commensurate distribution with which to pay the liability. An electing U.S.
Shareholder's basis in the common shares would be increased by the amounts
included in income. Distributions out of earnings and profits previously
included by such U.S. Shareholder generally would not be treated as a taxable
dividend for United States federal income tax purposes and would result in a
corresponding reduction of basis in common shares. An electing U.S. Shareholder
will not be currently taxed on the undistributed ordinary income and net capital
gain of Nymox for any year that Nymox is not classified as a PFC.

If Nymox is a PFC, a U.S. Shareholder may avoid certain of the tax consequences
described in the preceding two paragraphs if the Nymox common stock is
marketable and meets the other requirements of Section 1296 of the Code, and the
U.S. Shareholder elects to mark to market the common stock on an annual basis.
The common stock will be marketable so long as it is regularly traded on a
recognized exchange.

In general, a U.S. Shareholder in a PFC who elects under Section 1296 to mark
the common stock to market would include in income each year an amount equal to
the excess, if any, of the fair market value of the common stock as of the close
of the taxable year over the U.S. Shareholder's adjusted basis in such stock. A
U.S. Shareholder who makes the Section 1296 election would also generally be
allowed a deduction for the excess, if any, of the adjusted basis of the common
stock over the fair market value as of the close of the taxable year. Deductions
under this rule, however, are allowable only to the extent of any net mark to
market gains with respect to the common stock included by the shareholder for
prior taxable years.

Once the Mark to Market election is made, it is binding for all subsequent
years, unless the common stock ceases to be marketable, or the IRS consents to
the revocation of the election.

If Nymox is a PFC, each U.S. Shareholder is strongly urged to consult with his
or her tax advisor to determine whether the Q.E.F. Election or the Mark to
Market Election should be made. Each

                                       74
<PAGE>   75

requires attention to specific rules and regulations, and each may not be
available to a specific U.S. shareholder.

Nymox intends to notify its U.S. Shareholders within 45 days after the end of
the taxable year for which Nymox believes it might be a PFC. Nymox has further
undertaken (i) to provide its U.S. Shareholders with timely and accurate
information as to its status as a PFC and the manner in which the Q.E.F.
Election can be made and (ii) to comply with all record-keeping, reporting and
other requirements so that U.S. Shareholders, at their option, may make a Q.E.F.
Election.

FUTURE DEVELOPMENTS

The foregoing discussion is based on existing provisions of the Code, existing
and proposed regulations thereunder and current administrative rulings and court
decisions, all of which are subject to change. Any such changes could affect the
validity of this discussion. In addition, the implementation of certain aspects
of the PFC rules requires the issuance of regulations which in many instances
have not been promulgated and which may have retroactive effect.

There can be no assurance that current authorities will not be changed and, if
so, as to the form they will take or the effect they may have on this
discussion.

CANADIAN FEDERAL INCOME TAXATION

The following is, as of the date of annual report, a summary of the principal
Canadian federal income tax considerations generally applicable to shareholders
who receive a dividend from Nymox and who, at all relevant times, for purposes
of the Income Tax Act (Canada) the ("Tax Act"), hold and will hold Nymox common
shares as capital property and deal with Nymox at arm's length.

Nymox's common shares will generally constitute capital property to a holder
unless the holder holds such shares in the course of carrying on a business or
the holder has acquired such shares in a transaction or transactions considered
to be an adventure in the nature of trade. This summary is based on the current
provisions of the Tax Act, the regulations under that act, counsel's
understanding of current administrative and assessing policies of the Canada
Customs and Revenue Agency and all specific proposals to amend the Tax Act
publicly announced or released by or on behalf of the Minister of Finance
(Canada) before the date of this annual report ("Tax Proposals").

The Tax Act contains certain provisions relating to securities held by certain
financial institutions (the "Mark-to-Market Rules"). This summary does not take
into account these Mark-to-Market Rules or any amendments to them contained in
the Tax Proposals and taxpayers that are "financial institutions" for purposes
of those rules should consult their own tax advisors.

This summary is not exhaustive of all possible Canadian federal income tax
considerations and, except for the Tax Proposals, does not take into account or
anticipate any changes in law, whether by legislative, governmental or judicial
action, nor does it take into account tax legislation of any province, territory
or foreign jurisdiction. This summary is of a general nature

                                       75


<PAGE>   76

only and is not intended to be, nor should it be construed as, legal or tax
advice to any particular holder of Nymox common shares.

CANADIAN RESIDENTS

The following summary is relevant to a holder of Nymox common shares who, for
purposes of the Tax Act and any applicable tax treaty or convention, is resident
in Canada at all relevant times.

Tax Treatment of Capital Gains and Capital Losses for Canadian Residents

On a disposition or deemed disposition of a Nymox common share, the holder will
realize a capital gain (or capital loss) equal to the amount by which the
proceeds of disposition for the Nymox common share exceed (or are less than) the
aggregate of any costs of disposition and the adjusted cost base to the holder
of the Nymox common share immediately before the disposition.

Pursuant to the Tax Proposals and subject to certain transitional rules which
apply in certain circumstances, a holder of Nymox common shares will be required
to include in income one-half of the amount of any capital gain (a "Taxable
capital gain") and may deduct one-half of the amount of any capital loss (an
"Allowable capital loss") against Taxable capital gains realized by the holder
in the year of the disposition. Allowable capital losses in excess of Taxable
capital gains may be carried back and deducted in any of the three preceding
years or carried forward and deducted in any following year against taxable
capital gains realized in such years to the extent and under the circumstances
described in the Tax Act and the Tax Proposals.

A Canadian-controlled private corporation will also be subject to a refundable
tax of 6 2/3% on certain investment income, including taxable capital gains
realized on the disposition of Nymox common shares, that will be refunded when
the corporation pays taxable dividends (at a rate of $1.00 for every $3.00 of
taxable dividend paid).

A capital loss realized by a holder of Nymox common shares that is a
corporation, a partnership of which a corporation is a member or a trust of
which a corporation is a beneficiary may be reduced by the amount of dividends
received in certain circumstances. Capital gains realized by an individual may
give rise to a liability for alternative minimum tax.

Tax Treatment of Dividends Received by Canadian Residents

In the case of a holder of Nymox common shares who is an individual, any
dividends received on the common shares will be included in computing his income
and will be subject to the gross-up and dividend tax credit rules normally
applicable to taxable dividends paid by taxable Canadian corporations. A holder
that is a corporation may be liable to pay refundable tax under Part IV of the
Tax Act. However, a public corporation which is not controlled, whether because
of a beneficial interest in one or more trusts or otherwise, by or for the
benefit of an individual (other than a trust) or a related group of individuals
(other than trusts) will not be liable to pay refundable tax under Part IV of
the Tax Act.

                                       76


<PAGE>   77
In the case of a holder of Nymox common shares that is a corporation, the amount
of any capital loss otherwise determined resulting from the disposition of a
Nymox common share may be reduced by the amount of dividends previously received
or deemed to have been received thereon. Any such restriction will not occur
where the corporate holder owned the Nymox common share for 365 days or longer
and such holder (together with any persons with whom it did not deal at arm's
length) did not own more than 5% of the shares of any class or series of Nymox
at the time the relevant dividends were received or deemed to have been
received. Analogous rules apply where a corporation is a member of a partnership
or a beneficiary of a trust, which owns Nymox common shares.

SHAREHOLDERS WHO ARE NOT RESIDENTS OF CANADA

The following summary is relevant to a holder of Nymox common shares, who, at
all relevant times, for purposes of the Tax Act and any applicable tax treaty or
convention, is a non-resident or is deemed to be a non-resident of Canada and
does not use and is not deemed to use or hold Nymox common shares in the course
of carrying on a business in Canada. Special rules, which are not discussed
below, may apply to a non-resident that is an insurer which carries on business
in Canada and elsewhere.

Dividends Paid To Non-Residents of Canada

Under the Tax Act, dividends paid or credited to a non-resident are subject to
withholding tax at the rate of 25% of the gross amount of the dividends. This
withholding tax may be reduced or eliminated pursuant to the terms of an
applicable tax treaty between Canada and the country of residence of the
non-resident. For example, for persons who are resident in the United States for
purposes of the Canada-United States Income Tax Convention, (the "Convention")
the rate of withholding tax on dividends is reduced to 15% generally and 5% when
the United States resident is a company that beneficially owns at least 10% of
the voting stock of the company paying the dividends.

Under the Convention, dividends paid to certain religious, scientific,
charitable and other similar tax-exempt organizations and certain organizations
that are resident in, and exempt from tax in, the United States are exempt from
Canadian non-resident withholding tax. Provided that certain administrative
procedures designed to establish with the Canadian tax authorities the right of
such entities to benefit from this withholding tax exemption are complied with
by the tax-exempt entities prior to the Distribution, Nymox would not be
required to withhold such tax on such payment. Alternatively, the
above-described tax-exempt entities may claim a refund of Canadian withholding
tax otherwise withheld by Nymox on the distribution of dividends.

Tax Treatment of Capital Gains of Non-Residents of Canada

On a disposition or deemed disposition of a Nymox common share, a non-resident
holder will realize a capital gain (or capital loss) equal to the amount by
which the proceeds of disposition for the Nymox common share exceed (or are less
than) the aggregate of any costs of disposition and the adjusted cost base to
the non-resident holder of the Nymox common share immediately before the
disposition.


                                       77
<PAGE>   78
A non-resident of Canada is liable for Canadian income tax on a capital gain
realized on the disposition of property only where that property constitutes
"taxable Canadian property". Pursuant to the Tax Proposals and subject to
certain transitional rules which apply in certain circumstances, one-half of any
capital gain from the disposition of taxable Canadian property is subject to
Canadian tax.

Under the Tax Act, shares of Nymox will not constitute taxable Canadian property
unless, at any time, in the five years immediately preceding the disposition,
the non-resident holder, persons with whom the non-resident holder did not deal
at arms length, or the non-resident holder together with all such persons owned
(or had a right to acquire) 25% or more of the shares of any class of Nymox.
Even in circumstances where shares of Nymox are taxable Canadian property to a
non-resident holder, the non-resident holder may be entitled to relief from
Canadian tax on any capital gain realized on the disposition thereof pursuant to
the terms of an applicable tax treaty between Canada and the country of
residence of the non-resident. For example, the Convention provides that gains
realized by a resident of the United States on the disposition or deemed
disposition of shares of a company will generally not be subject to tax under
the Tax Act, provided that the value of the shares is not derived principally
from real property situated in Canada. Nymox believes that the value of its
shares is not currently derived principally from real property situated in
Canada and it does not expect this to change in the foreseeable future.

Provided that the Nymox common shares remain listed on a prescribed stock
exchange, which includes the Nasdaq SmallCap Market System, a non-resident
holder who disposes of Nymox common shares will not be required to comply with
the Canadian notification procedures generally applicable to dispositions of
taxable Canadian property.

ITEM 11. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Not applicable.

ITEM 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES

Not applicable

PART II

ITEM 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES

Not applicable

ITEM 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF
         PROCEEDS

Not applicable

PART III

ITEM 17. FINANCIAL STATEMENTS

The financial statements listed in item 19 are incorporated by reference in this
item.

                                       78
<PAGE>   79
ITEM 18. FINANCIAL STATEMENTS

Not applicable

ITEM 19. FINANCIAL STATEMENTS AND EXHIBITS

a)       Financial statements (which appear in Item 8):

At and for the year ended December 31, 2000:

         Consolidated Balance Sheet
         Consolidated Statement of Earnings and Deficit
         Consolidated Statements of Cash Flows Notes

At and for the year ended December 31, 1999:

         Consolidated Balance Sheet
         Consolidated Statement of Earnings and Deficit
         Consolidated Statements of Cash Flows
         Notes

At and for the year ended December 31, 1998:

         Consolidated Statement of Earnings and Deficit
         Consolidated Statements of Cash Flows
         Notes

SIGNATURES

Pursuant to the requirements of Section 12 of the Securities Exchange Act of
1934, the registrant certifies that it meets all of the requirements for filing
on Form 20 - F and has duly caused this registration statement to be signed on
its behalf by the undersigned, thereunto duly authorized.

                                              NYMOX PHARMACEUTICAL CORPORATION
                                                        (Registrant)

                                                     /S/ Paul Averback
                                                     -----------------
                                                     Paul Averback
                                                     Title: President

Date: May 8, 2001


                                       79
<PAGE>   80

EXHIBIT INDEX
NYMOX PHARMACEUTICAL CORPORATION

Form 20-F Annual Report

<TABLE>
<CAPTION>

          EXHIBIT NO.                                        DESCRIPTION                                   PAGE NO.
<S>                               <C>                                                                      <C>
              1(a)                Articles of Incorporation, as amended. (incorporated by reference
                                  to Exhibit 3.1 to the Company's 20-F filed with the Commission
                                  December 9, 1996.)                                                          N\A

              1(b)                Bylaws of the Company (incorporated by
                                  reference to Exhibit 3.2 to the Company's 20-F
                                  filed with the Commission December 9, 1996.)                                N\A

              4(a)                Memorandum of Agreement between Paul Averback
                                  and the Company (incorporated by reference to
                                  Exhibit 10.1 to the Company's 20-F filed with
                                  the Commission December 9, 1996.)                                           N\A

              4(b)                Share Option Plan of the Company (incorporated by reference to
                                  Exhibit 10.2 to the Company's 20F filed with
                                  the Commission December 9, 1996.)                                           N\A

              4(c)                Research and License Agreement between the Massachusetts General
                                  Hospital Corporation and the Company (incorporated by reference
                                  to Exhibit 10.3 to the Company's 20-F filed
                                  with the Commission December 9, 1996.)                                      N\A

              4(d)                Research and License Amendment between the Massachusetts General
                                  Hospital Corporation and the Company (incorporated by reference
                                  to Exhibit 10.5 to the Company's 20-F filed
                                  with the Commission December 9, 1996.)                                      N\A

              4(e)                Common Stock Purchase Agreement between Nymox Pharmaceutical
                                  Corporation and Jaspas Investments Limited dated November 1, 1999
                                  (incorporated by reference to Exhibit 2.0 to the Company's form
                                  F-1 registration statement filed with the
                                  Commission February 29, 2000.)                                              N\A

              4(f)                Registration Rights Agreement between Nymox Pharmaceutical
                                  Corporation and Jaspas Investments Limited dated November 1, 1999
                                  (incorporated by reference to Exhibit 2.1 to the Company's form
                                  F-1 registration statement filed with the
                                  Commission February 29, 2000.)                                              N\A

              4(g)                Escrow Agreement among Nymox Pharmaceutical Corporation, Jaspas
                                  Investments Limited and Epstein, Becker & Green, P.C. dated
                                  November 1, 1999 (incorporated by reference to Exhibit 2.2 to the
                                  Company's form F-1 registration statement
                                  filed with the Commission February 29, 2000.)                               N\A

              4(h)                Stock Purchase Warrant to purchase common
                                  shares issued to Jaspas Investments Limited
                                  dated November 1, 1999 (incorporated by
                                  reference to Exhibit 2.3 to the Company's form
                                  F-1 registration statement filed with the
                                  Commission February 29, 2000.)                                              N\A

              4(i)                Employment Agreement between Nymox Pharmaceutical Corporation and
                                  Dr. Judith Fitzpatrick (incorporated by reference to Exhibit 2.4
                                  to the Company's form F-1 registration statement filed with the
                                  Commission February 29, 2000.)                                              N\A

              4(j)                Research and License Agreement between the Rhode Island Hospital
                                  Corporation and the Company dated May 14, 1999 (incorporated
                                  by reference to Exhibit 10.10 to the Company's 20-F filed with the
                                  Commission May 15, 2000.)                                                   N\A
</TABLE>


                                       80
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{"company-data": {"conformed-name": "NYMOX PHARMACEUTICAL CORP", "cik": "0001018735", "assigned-sic": "2835", "irs-number": "000000000", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "20-F", "act": "34", "file-number": "001-12033", "film-number": "1625482"}, "business-address": {"street1": "9900 CAVENDISH BLVD., SUITE 306", "street2": "ST. LAURENT, QUEBEC", "city": "CANADA H4M 2V2", "state": "A8", "phone": "514-332-3222"}, "mail-address": {"street1": "9900 CAVENDISH BLVD., SUITE 306", "street2": "ST. LAURENT, QUEBEC", "city": "CANADA, H4M 2V2", "state": "A8"}}
1
                                  Form 20 - F

[ ]  Registration statement pursuant to section 12(b) or (g) of the Securities
     Exchange Act of 1934 [Fee required]

                                       or

[X]  Annual report pursuant to section 13 or 15(d) of the Securities Exchange
     Act of 1934 [Fee required] - For the fiscal year ended December 31, 2000

                                       or

[ ]  Transition report pursuant to section 13 or 15(d) of the Securities
     Exchange Act of 1934 [No fee required] - For the transition period from
             to

                        Nymox Pharmaceutical Corporation
             (Exact name of registrant as specified in its charter)
                                     Canada

                (Jurisdiction of incorporation or organization)
                        9900 Cavendish Blvd., Suite 306
                      St. Laurent, Quebec, Canada, H4M 2V2

Securities registered or to be registered pursuant to section 12(b) of the Act.

Title of each class                    Name of each exchange on which registered
-------------------                    -----------------------------------------
       None                                          Not Applicable

 Securities registered or to be registered pursuant to section 12(g) of the Act
                                  Common Stock

 Securities registered or to be registered pursuant to section 15(d) of the Act
                                      None

Indicate the number of outstanding shares of each of the issuer's classes of
capital or common stock as of the close of the period covered by the annual
report: 21,377,621 shares as of December 31, 2000.

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such report(s)), and (2) has been subject to such filing
requirements for the past 90 days.

                 Yes [X]                                  No [ ]

     Indicate by check mark which financial statement item the registrant has
elected to follow.

               Item 17 [X]                             Item 18  [ ]

                                       1
2

In this annual report, the term "Nymox" refers to both Nymox Pharmaceutical
Corporation and its subsidiaries, Nymox Corporation and Serex Inc., and, where
applicable, a predecessor private corporation, DMS Pharmaceuticals Inc.

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

You should be aware that this annual report contains forward-looking statements
about, among other things, the anticipated operations, product development,
financial condition and operating results of Nymox, proposed clinical trials and
proposed transactions, including collaboration agreements.

By forward-looking statements, we mean any statements that are not statements of
historical fact, including (but are not limited to) statements preceded by or
that include the words, "believes", "expects", "anticipates", "hopes", "targets"
or similar expressions.

In connection with the "safe harbor" provisions in the Private Securities
Litigation Reform Act of 1995, we are including this cautionary statement to
identify some of the important factors that could cause Nymox's actual results
or plans to differ materially from those projected in forward-looking statements
made by, or on behalf of, Nymox. These factors, many of which are beyond the
control of Nymox, include Nymox's ability to:

     -    identify and capitalize on possible collaboration, strategic
          partnering or divestiture opportunities,

     -    obtain suitable financing to support its operations and clinical
          trials,

     -    manage its growth and the commercialization of its products,

     -    achieve operating efficiencies as it progresses from a
          development-stage to a later-stage biotechnology company,

     -    successfully compete in its markets,

     -    realize the results it anticipates from the clinical trials of its
          products,

     -    succeed in finding and retaining joint venture and collaboration
          partners to assist it in the successful marketing, distribution and
          commercialization of its products,

     -    achieve regulatory clearances for its products,

     -    obtain on commercially reasonable terms adequate product liability
          insurance for its commercialized products,

     -    adequately protect its proprietary information and technology from
          competitors and avoid infringement of proprietary information and
          technology of its competitors,

                                       2
3
     -    assure that its products, if successfully developed and commercialized
          following regulatory approval, are not rendered obsolete by products
          or technologies of competitors and

     -    not encounter problems with third parties, including key personnel,
          upon whom it is dependent.

Although Nymox believes that the forward-looking statements contained in this
annual report are reasonable, it cannot ensure that its expectations will be
met. These statements involve risks and uncertainties. Actual results may differ
materially from those expressed or implied in these statements. Factors that
could cause such differences include, but are not limited to, those discussed in
the section entitled "Risk Factors" in Item 3, Description of Business.

PART I

ITEM 1.  IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS

Not Applicable

ITEM 2.  OFFER STATISTICS AND EXPECTED TIMETABLE

Not Applicable

ITEM 3.  KEY INFORMATION

SELECTED FINANCIAL DATA

The following table sets forth selected consolidated financial data for Nymox
for the periods indicated, derived from financial statements prepared in
accordance with generally accepted accounting principles ("GAAP"). We prepare
our basic financial statements in accordance with Canadian GAAP and include, as
a note to the statements, a reconciliation of material differences to United
States GAAP. The financial statements have been audited by KPMG, LLP, Montreal,
Canada in the case of the years ended December 31, 1996,1997,1998,1999 and 2000.
The data set forth below should be read in conjunction with the Company's
financial statements and notes thereto and "Management's Discussion and Analysis
of Financial Conditions and Results of Operations" included elsewhere herein.

                                       3
4

NYMOX PHARMACEUTICAL CORPORATION

Selected Consolidated Financial Data
(In U.S. dollars - Note 3)
Dec.31, 2000        Dec.31, 1999        Dec.31, 1998       Dec.31, 1997        Dec.31, 1996
                                         ------------        ------------        ------------       ------------        ------------
CANADIAN GAAP

Current Assets                                749,510             776,824           2,708,543          1,750,388           2,006,675

Capital Assets                              3,546,616           1,168,316           1,279,692            983,484             913,166

Total Assets                                4,518,638           2,140,491           3,988,235          2,733,872           2,919,841

Total Liabilities                             323,774             833,344             301,004            202,543             266,214

Capital Stock                              23,243,941          16,912,963          15,943,710          9,597,888           6,445,431

Shareholders' Equity                        3,260,942           1,307,147           3,687,231          2,531,329           2,653,628

Revenues                                      225,867             190,203             273,565             70,055             157,237

Sales                                         157,688             153,252             104,804             17,033                 -0-

Research & Development
Expenditures (note 1)                       2,073,775           1,132,941           2,087,742          1,671,412           1,466,085

Net Loss                                    4,023,979           3,314,296           4,783,213          3,463,905           2,562,921

Loss per Share                                   0.19                0.17                0.25               0.19                0.15

Weighted Avg. No. of
Common Shares                              20,890,735          19,886,430          19,304,435         18,370,873          17,654,862

U.S. GAAP (note 2)

Net Loss                                    4,272,308           3,409,166           4,979,562          3,755,409           3,175,587

Loss per Share                                   0.20                0.17                0.26               0.20                0.18

Shareholders' Equity                        3,102,887           1,139,731           3,304,352          2,428,052           2,699,092
Notes:
1)   We earn investment tax credits by making qualifying research and
     development expenditures. These amounts shown are net of investment tax
     credits.

2)   Reference is made to Note 10 of Nymox's audited financial statements as at
     and for the year ended December 31, 2000 for a reconciliation of
     differences between Canadian and U.S. GAAP.

3)   Effective January 1, 2000, the Corporation adopted the United States dollar
     as its measurement currency as a result of the increasing proportion of
     operating, financing and investing transactions in the Canadian operations
     that are denominated in U.S. dollars. For Canadian GAAP purposes, the
     financial information for all periods presented up to December 31, 1999 has
     been translated into U.S. dollars at the December 31, 1999 exchange rate,
     which was 1.4433 Canadian dollars to the U.S. dollar. For U.S. GAAP
     purposes, assets and liabilities for all years presented have been
     translated into U.S. dollars at the ending exchange rate for the respective
     year and the statement of earnings at the average rate for the respective
     year. Reference is made to notes 2(a) and 10 of the consolidated financial
     statements.

                                       4
5

RISK FACTORS

The following risk factors apply to Nymox and our industry.

IT IS UNCERTAIN WHEN, IF EVER, WE WILL MAKE A PROFIT.

We first began operations in 1995 and are only in the early stages of commercial
marketing of our diagnostic test, the AlzheimAlert(TM) test. We have never made
a profit. We incurred a net loss of $4.8 million in 1998, $3.3 million in 1999
and $4.0 million in 2000. As of December 31, 2000, Nymox's accumulated deficit
was $19.9 million.

We cannot say when, if ever, Nymox will become profitable. Profitability will
depend on our uncertain ability to generate revenues from the sale of our
products and the licensing of our technology that will offset the significant
expenditures required for us to advance our research, protect and extend our
intellectual property and develop, manufacture, license, market, distribute and
sell our technology and products successfully. Similar types of expenditures in
the past have helped produce the net losses reported above.

WE MAY NOT BE ABLE TO RAISE ENOUGH CAPITAL TO DEVELOP AND MARKET OUR PRODUCTS.

Nymox has funded its operations primarily by selling shares of its common stock.
Since late 1998, a small portion of the funds came from service revenues.
However, service revenues have not been, and may not be in the foreseeable
future, sufficient to meet our anticipated financial requirements.

We will continue to need to raise substantial amounts of capital for our
business activities including our research and development programs, the conduct
of clinical trials needed to obtain regulatory approvals and the marketing and
sales of our products. Additional financing may not be available when needed,
or, if available, may not be available on acceptable terms. If adequate funds on
acceptable terms are not available, we may have to curtail or eliminate
expenditures for research and development, testing, clinical trials, promotion
and marketing for some or all of our products.

WE FACE CHALLENGES IN DEVELOPING AND IMPROVING OUR PRODUCTS.

The pharmaceutical and diagnostic industries are driven by rapid technological
and scientific developments and changing customer needs. Nymox's success
depends, in large part, on its ability to respond to our customers' requirements
in a timely manner by developing or acquiring rights to new products or
improvements to our existing products. We are still developing many of our
products and have not yet brought them to market. We cannot assure you that we
will be able to develop or acquire rights to such products and to market them
successfully.

WE FACE SIGNIFICANT AND GROWING COMPETITION.

Rapidly evolving technology and intense competition are the hallmarks of modern
pharmaceutical and biotechnology industries. Our competitors include:

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     -    major pharmaceutical, diagnostic, chemical and biotechnology
          companies, many of which have financial, technical and marketing
          resources significantly greater than ours;

     -    biotechnology companies, either alone or in collaborations with large,
          established pharmaceutical companies to support research, development
          and commercialization of products that may be competitive with ours;
          and

     -    academic institutions, government agencies and other public and
          private research organizations which are conducting research into
          Alzheimer's disease and which increasingly are patenting, licensing
          and commercializing their products either on their own or through
          joint ventures.

WE MAY NOT BE ABLE TO SUCCESSFULLY MARKET OUR PRODUCTS.

To increase our marketing, distribution and sales capabilities both in the
United States and around the world, we will need to enter into licensing
arrangements, contract sales agreements and co-marketing deals. We cannot assure
you that we will be able to enter into agreements with other companies on terms
acceptable to us, that any licensing arrangement will generate any revenue for
the company or that the costs of engaging and retaining the services of a
contract sales organization will not exceed the revenues generated.

OUR PRODUCTS AND SERVICES MAY NOT RECEIVE NECESSARY REGULATORY APPROVALS.

Our AlzheimAlert(TM) testing service and our products in development are subject
to a wide range of government regulation governing laboratory standards, product
safety and efficacy. The actual regulatory schemes in place vary from country to
country and regulatory compliance can take several years and involve substantial
expenditures.

We cannot be sure that we can obtain necessary regulatory approvals on a timely
basis, if at all, for our products in development and all of the following could
have a material adverse effect on our business:

     -    failure to obtain or significant delays in obtaining requisite
          approvals;

     -    loss of or changes to previously obtained approvals; and

     -    failure to comply with existing or future regulatory requirements.

The operation of our clinical reference laboratory in New Jersey is regulated by
the Health Care Financing Administration (HCFA) under the Clinical Laboratories
Improvement Act of 1988. In addition, individual states like New York and
Florida have their own requirements for reference laboratories like ours that
offer diagnostic services. In addition, the United States Food and Drug
Administration (FDA) has its own regulations governing in vitro diagnostic
products, including some of the reagents used in clinical reference
laboratories. Any changes in HCFA or state law requirements or in the FDA
regulations could have a detrimental impact on our ability to offer or

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market any reference laboratory services and/or on our ability to obtain
reimbursement from the Medicare and Medicaid programs and providers.

We will require prior approval from the FDA before we can distribute and sell in
the United States an AlzheimAlert(TM) diagnostic kit, which permits the testing
of patient samples either in a general purpose laboratory or the physician's
office. Similar requirements exist in many other countries. In general, such
approval requires clinical testing as to the safety and efficacy of the device
and preparation of an approval application with extensive supporting
documentation. If approved, the device would then be subject to postmarketing
record and reporting obligations and manufacturing requirements. Obtaining these
approvals and complying with the subsequent regulatory requirements can be both
time-consuming and expensive.

In the United States, our drugs in development will require FDA approval, which
comes only at the end of a lengthy, expensive and often arduous two-step
process. We cannot predict with any certainty the amount of time the FDA will
take to approve one of our drugs or even whether any such approval will be
forthcoming. Similar requirements exist in many other countries.

PROTECTING OUR PATENTS AND PROPRIETARY INFORMATION IS COSTLY AND DIFFICULT.

We believe that patent and trade secret protection is important to our business,
and that our success will depend, in part, on our ability to obtain strong
patents, to maintain trade secret protection and to operate without infringing
the proprietary rights of others.

The commercial success of products incorporating our technologies may depend, in
part, upon our ability to obtain strong patent protection. We cannot assure you
that additional patents covering new products or improvements will be issued or
that any new or existing patents will be of commercial benefit or be valid and
enforceable if challenged.

CHANGING MARKET CONDITIONS.

The healthcare industry is in transition with a number of changes that affect
the market for therapeutic and diagnostic test products. Changes in the
healthcare delivery system have resulted in major consolidation among reference
laboratories and in the formation of multi-hospital alliances, reducing the
number of institutional customers for therapeutic and diagnostic test products.
There can be no assurance that Nymox will be able to enter into and/or sustain
contractual or other marketing or distribution arrangements on a satisfactory
commercial basis with these institutional customers.

HEALTH CARE PLANS MAY NOT COVER OR ADEQUATELY PAY FOR OUR PRODUCTS AND SERVICES.

Throughout the developed world, both public and private health care plans are
under considerable financial and political pressure to contain their costs. The
two principal methods of restricting expenditures on drugs and diagnostic
products and services are to deny coverage or, if coverage is granted, to limit
reimbursement. For single-payer government health care systems, a decision to
deny coverage or to severely restrict reimbursement for one of our products can
have an adverse effect on our business and revenues.

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In the United States, where, to a significant degree, the patient population for
our products is elderly, Medicare and Medicaid are sources of reimbursement. In
general, any restriction on reimbursement, coverage or eligibility under either
program could adversely affect reimbursement to Nymox for products and services
provided to beneficiaries of the Medicare and/or Medicaid programs. Many elderly
people are covered by a variety of private health care organizations either
operating private health care plans or Medicare or Medicaid programs subject to
government regulation. These organizations are also under considerable financial
constraints and we may not be able to secure coverage or adequate reimbursement
from these organizations. Without coverage, we will have to look to the patients
themselves who may be unwilling or unable to pay for the product; in turn,
doctors may be reluctant to order or prescribe our products in the absence of
coverage of the product for the patient.

THE FUTURE SALE OF ELIGIBLE SHARES MAY DILUTE NYMOX'S STOCK PRICE.

The issuance of further shares and the eligibility of issued shares for sale
will dilute our common stock and may lower its share price. There are 21,739,317
common shares of Nymox currently issued and outstanding as of March 31, 2001,
including the 452,201 shares issued to date under the Share Purchase Agreement
entered into with Jaspas Investments Limited. All of these shares are eligible
for sale under Rule 144 or are otherwise freely tradable. Finally, 1,649,500
share options are outstanding, of which 1,418,167 are currently vested. The
great majority of these options expire in 6 to 10 years. These options have been
granted to employees, officers, directors and consultants of the company.
Moreover, Nymox may use its shares as currency in acquisitions.

WE FACE POTENTIAL LOSSES DUE TO FOREIGN CURRENCY EXCHANGE RISKS.

The Corporation incurs certain expenses, principally relating to salaries and
operating expenses at its Canadian head office, in Canadian dollars. All other
expenses are derived in US dollars. As a result, we are exposed to the risk of
losses due to fluctuations in the exchange rates between the United States
dollar and the Canadian dollar. We protect ourselves against this risk by
maintaining cash balances in both currencies. We do not currently engage in
hedging activities. We cannot say with any assurance that the company will not
suffer losses as a result of unfavorable fluctuations in the exchange rates
between the United States dollar and Canadian dollar.

WE HAVE NEVER PAID A DIVIDEND AND ARE UNLIKELY TO DO SO IN THE FORESEEABLE
FUTURE.

Nymox has never paid any dividends and does not expect to do so in the
foreseeable future. We expect to retain any earnings or positive cash flow in
order to finance and develop Nymox's business.

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ITEM 4. INFORMATION ON THE COMPANY

HISTORY OF THE COMPANY

Nymox Pharmaceutical Corporation was incorporated in Canada under the Canada
Business Corporations Act in May, 1995 to acquire all of the common shares of
DMS Pharmaceutical Inc., a private company which had been carrying on research
and development since 1989 on diagnostics and drugs for brain disorders and
diseases of the aged with an emphasis on Alzheimer's disease. Nymox has two
United States subsidiaries; one wholly owned subsidiary named Nymox Corporation
and the other a 97% owned subsidiary named Serex, Inc, purchased in March, 2000.

Nymox's principal executive offices are located at:

     Nymox Pharmaceutical Corporation
         9900 Cavendish Boulevard, Suite 306
         St.-Laurent, Quebec, Canada, H4M 2V2
         Phone: (800) 936-9669
         Fax: (514) 332-2227

     Nymox Corporation
         230 West Passaic St.
         Maywood, NJ, USA 07607

     Serex, Inc.
         230 West Passaic St.
         Maywood, NJ, USA 07607

ACQUISITION OF A MAJORITY INTEREST IN SEREX, INC.

On March 2, 2000, we closed our acquisition of a majority interest in Serex,
Inc., a privately held diagnostic company that was founded by Dr. Judith
Fitzpatrick in 1983 and is based in Maywood, New Jersey.

We have subsequently acquired more shares of the common stock of Serex, Inc.
from other shareholders and now own approximately 97% of its common stock.

Serex assisted in the development of Nymox's AlzheimAlert(TM) test and the
patenting of some of the technology relating to AlzheimAlert(TM).

Serex also developed and patented its particle valence technology, a unique,
highly sensitive, new method to detect very small amounts of biochemical
indicators in body fluids such as blood, urine and saliva. Serex licensed the
Japanese rights to two of its principal patents to Mizuho Medy Co. Ltd. of
Japan.

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Serex's diagnostic technology can be adapted to detect a wide range of
biochemical indicators for diseases, conditions and drug use.

Preliminary work at Serex has identified a wide range of potential applications
for its patented technology from detecting an early indicator of pregnancy, to
detecting a brain protein implicated in certain brain diseases, from detecting
indicators for heart disease, determining blood sugar levels in a type of
diabetes and to monitoring therapeutic drug levels.

Serex developed its NicAlert(TM) which can reliably detect one of the metabolic
products of nicotine in human urine and saliva, enabling it to determine whether
a person, such as a teenager or insurance applicant, is using a tobacco product.
NicAlert(TM) is currently being distributed in Japan by Mizuho Medy Co. Ltd. of
Japan and outside of Japan by Nymox and Jant Pharmacal Corporation.

In November, 1999, Serex was granted a United States patent for an antibody and
for the use of the antibody in its technology in order to detect one of the
biochemical indicators for the loss of bone matter, which is a sign of
osteoporosis, the most common bone disease in humans. Osteoporosis results from
the progressive loss of bone material and can cause disabling and potentially
life-threatening bone fractures in particular of the spine and the hips. It is
most common in the elderly and in post-menopausal women.

Serex has under development a test that can potentially detect biochemical
indicators of cholesterol in human saliva and therefore provide an inexpensive,
convenient and reliable method of determining and monitoring cholesterol levels.

Since 1996, Serex has collaborated with at least three major pharmaceutical
companies and two diagnostic companies under licensing and development
agreements concerning the development of some of these products. These
agreements contain confidentiality provisions that prohibit the disclosure of
their terms.

CAPITAL EXPENDITURES

For information concerning our capital expenditures and methods of financing,
please see Item 5 entitled "Operating and Financial Review and Prospects".

BUSINESS OVERVIEW

Nymox is a development stage biopharmaceutical company based in Maywood, New
Jersey and Saint Laurent, Quebec, Canada.

We specialize in the research and development of therapeutics and diagnostics
for the aging population with an emphasis on Alzheimer's disease. Alzheimer's
disease is a progressive, terminal brain disease of the elderly marked by an
irreversible decline in mental abilities, including memory and comprehension,
and often accompanied by changes in behavior and personality. It currently
afflicts an estimated four million people in the United States and at least 15
million people worldwide. As the baby-boomer generation continues to age, these
figures are expected to rise sharply.

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DIAGNOSTIC PRODUCTS FOR ALZHEIMER'S DISEASE

Alzheimer's disease is the most common cause of dementia in persons 65 years of
age and older and is the fourth leading cause of death among the elderly.
Despite the need for an accurate clinical test, the definitive diagnosis of the
disease is possible only after the death of the patient by expert, pathologic
examination of brain tissue.

The Surgeon General's Report on Mental Health, released on December 13, 1999,
identified the importance and the need for the early detection and diagnosis of
Alzheimer's disease. The report described the current approach to Alzheimer's
disease diagnosis, clinical examination and the exclusion of other common causes
of its symptoms, as time- and labor-intensive, costly and largely dependent on
the expertise of the examiner. As a result, the illness is currently
underrecognized, especially in primary care settings, where most older patients
seek care. The report joined other experts writing in the field in recognizing
the need for a better, more reliable method for diagnosing the disease in living
patients and in particular, the need of a simple, accurate and convenient test
that could detect a biochemical change early in patients with Alzheimer's
disease. We believe our AlzheimAlert(TM) provides such a test.

ALZHEIMALERT (TM)

We market a proprietary diagnostic test for Alzheimer's disease, known as the
AlzheimAlert(TM) Test, through our reference laboratory in Maywood, New Jersey.
AlzheimAlert(TM) is an improved version of our AD7C(TM) test, which has been on
the market since 1997. It is a urine test, where the patient provides a
first-morning urine sample for testing. The patient's doctor then forwards the
sample to our laboratory where our technical staff performs the test. We then
report the results to the doctor.

AlzheimAlert(TM) is the latest generation of our NTP testing technology. It
measures the level of a brain protein called neural thread protein (NTP) which
is elevated early in Alzheimer's disease as reported both in the scientific
literature and at scientific conferences. Researchers at the Massachusetts
General Hospital and Brown University led by Doctors Suzanne de la Monte and
Jack Wands first found large amounts of the protein in the brain tissue of
patients known to have died with Alzheimer's disease. Subsequent research led to
the characterization of NTP and the gene that produces it. Nymox succeeded in
developing a highly sensitive test to detect the presence of NTP in the spinal
fluid and, most recently, in the urine of patients with Alzheimer's disease. A
recent study (J. Neuropathol Exp Neurol (2001; 60: 195-207)) has provided
further evidence that increased production of NTP leads to a marked increase in
nerve cell death and shown that the cells subjected to the NTP died in a
programmed fashion similar to the way the nerve cells in the brains of patients
with Alzheimer's disease die. One of the characteristic signs of Alzheimer's
disease is widespread brain cell loss.

Nymox believes that its AlzheimAlert(TM) test can assist a physician faced with
the task of diagnosing whether a patient has Alzheimer's disease. In company
funded trials of its NTP testing technology to date, involving over 500 clinical
samples, the test results were positive for over 80% of the patients with
verified Alzheimer disease and negative in over 89% of subjects without the
disease (known as a low false positive rate). The low rate of positive results
for

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patients without the disease is important for doctors investigating patients
with subtle or marginal symptoms of mental, emotional, cognitive, or behavioral
changes. If the doctor can rule out Alzheimer's with more assurance, a great
deal of patient and family anguish and anxiety will be avoided. A low test score
will help the doctor to be more certain that Alzheimer's disease is not the
cause of the patient's symptoms and to target the other, often reversible causes
of the patient's symptoms, such as depression.

Many studies published in scientific publications or presented at scientific
conferences over the past decade have confirmed the accuracy of NTP as a
biochemical marker for Alzheimer's disease. Some recent publications include,
for example, the Journal of Clinical Investigation (1997; 100: 3093-3104),
Journal of Contemporary Neurology (1998; art. 4a), Journal of Clinical
Laboratory Analysis (1998; 12: 285-288) and (1998; 12: 223-226), Alzheimer's
Reports (1999; 2: 327-332) and (2000; 3: 177-184), and Neurology (2000; 54:
1498-1504). Reports about this Nymox technology have also been featured in
prestigious trade and lay publications such as Clinica (Sept.25, 2000), Genetic
Engineering News (Oct.1, 2000), Clinical Laboratory News (Oct., 2000), and
Modern Maturity (Dec., 2000).

There can be no assurance that further studies will repeat the same level of
success experienced to date.

The early diagnosis of Alzheimer's disease is important to physicians, patients
and their families and enables them to make informed and early social, legal and
medical decisions about treatment and care. Early diagnosis of Alzheimer's
disease has become increasingly important with new improvements in drug
treatment and care. Even a modest delay in institutionalization can mean
substantial social and financial savings. Conversely, any testing procedure that
could rule out Alzheimer's disease would eliminate the tremendous uncertainty
and anxiety patients and their families otherwise face and would allow
physicians to focus on the other, often reversible, causes of cognitive changes.

Early diagnosis as facilitated by the AlzheimAlert(TM) test represents a
potentially large cost-savings in the form of a reduced number of office visits,
lab tests, scans and other procedures required by the traditional methods of
diagnosis.

The AlzheimAlert(TM) test is an aid to diagnosis, to be considered together with
patient history, physical examination and other relevant medical data. The test
does not replace a physician's diagnosis.

Subject to further laboratory and clinical validation and to any necessary
regulatory approvals, we intend to sell the AlzheimAlert(TM) test worldwide as a
kit for the testing of patient samples either in a general purpose medical
laboratory or in a physician's office. AlzheimAlert(TM) offers a more
technically advanced means to detect elevated levels of NTP in urine. It is a
completely new assay in the competitive affinity format and has significant
advantages of easy adaptability to systems and equipment present in all modern
clinical laboratories.

We expect that, if approved, an AlzheimAlert(TM) kit will increase the
availability and acceptance of our test while lowering its cost to the patient
or health care payer.

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OTHER BIOCHEMICAL INDICATORS OF ALZHEIMER'S DISEASE

We hold exclusive patent rights to several other biochemical indicators for
Alzheimer's disease, including the brain protein, 35i9, which we believe is also
associated with Alzheimer's disease. We intend to use our extensive scientific,
medical and commercial experience and know-how in the field of Alzheimer's
disease in order to develop new diagnostic tests, methods and treatments for the
disease from these and other indicators.

DEVELOPMENT OF THERAPEUTIC PRODUCTS FOR ALZHEIMER'S DISEASE

At present, there is no cure for Alzheimer's disease. There are four drugs
approved by the FDA, tacrine (brand-name Cognex), donepezil HCI (brand-name
Aricept), rivastigmine (brand-name Exelon) and galantamine hydrobromide (brand
name Reminyl) for the treatment of Alzheimer's disease. However, at most these
drugs offer symptomatic relief for the loss of mental function associated with
the disease and possibly help to delay the illness- progression. There is no
consensus as to the cause of Alzheimer's disease or even whether it is one
disease or many.

There is an urgent need for an effective treatment for the illness, caused in
part by the rising health care, institutional and social costs for the treatment
and care of Alzheimer's disease sufferers. The Surgeon General's Report on
Mental Health released on December 13, 1999, put the direct health care costs
for the illness in the United States at almost $18 billion for 1996. In a 1998
statement to the House Appropriations Subcommittee, the Director of the National
Institute on Aging, Dr. Richard J. Hodes, estimated that the cost of care to
family, caregivers and society in general was as much as $100 billion per year.

These costs are expected to rise sharply as the baby boom generation ages and
more people become at risk for the disease. According to Dr. Hodes, the number
of Americans aged 65 or over, now some 34 million, is expected to more than
double by year 2030. Within this group, the population of persons over the age
of 85 is the fastest growing segment. As people live longer, they become more at
risk of developing Alzheimer's disease.

Nymox's research into drug treatments for Alzheimer's disease is aimed at
compounds that could arrest the progression of the disease and therefore are
targeted for long term use.

DRUGS TARGETING SPHERONS

We are a leader in research and development into drugs for the treatment of
Alzheimer's disease that target spherons. Nymox researchers believe that
spherons are the cause of senile plaques -- the characteristic lesion found
abundantly in the brains of patients with Alzheimer's disease and believed by
many researchers to play a pivotal role in the fatal illness. Spherons are tiny
balls of densely packed protein found in brain cells scattered throughout the
brains of all humans from age one. Nymox researchers have found that as humans
age the spherons grow up to a hundred times larger until they become too large
for the cells that hold them. Once released from the cells, the spherons burst
which the researchers believe creates the senile plaques and sets off a cascade
of cellular damage and biochemical changes pivotal to the symptoms and signs of
Alzheimer's disease.

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The substantial evidence linking spherons to senile plaques and Alzheimer's
disease has been published in journals such as the Journal of Alzheimer's
Disease, Drug News & Perspectives and Alzheimer Reports. There are 20 important
criteria of validity which have been set forth correlating the disappearance of
spherons in old age with the appearance of senile plaques and implicating
spherons as a major cause of Alzheimer's disease. In 2000, Nymox researchers
published important findings in Alzheimer Reports (2000; 3: 177-184) confirming
that spherons contain key proteins that are also known to be in senile plaques
and showing that, like senile plaques, spherons contain unusually old proteins
in terms of the human body's metabolism, with an average age of 20 to 40 years.

Nymox researchers believe that stopping or inhibiting the transformation of
spherons into senile plaques will help stop or slow the progress of this
illness. You should be aware that there is no consensus among researchers about
the causes or possible treatments of Alzheimer's disease and that other
researchers do not share this belief that spherons are the cause of Alzheimer's
disease or are a target for the development of treatments for the disease.

Based on these research findings and this approach to the treatment of the
disease, we developed novel, proprietary drug screening methods based on
spherons and used them to discover, develop and test drug candidates to inhibit
the formation of Alzheimer plaques from spherons. These candidates have the
potential to slow or stop the progression of the disease. We have two distinct
new drug candidates, NXD-3109 and NXD-1191, neither of which demonstrate
significant toxicity and both of which had positive animal testing results.

Such drug candidates will require regulatory approval in order to begin clinical
studies for humans. You should be aware there is no guarantee that any of these
drug candidates will ever be approved for marketing as a treatment for
Alzheimer's disease. Drug candidates that look promising in early studies in the
laboratory or with animals often prove on further testing to be unsafe,
ineffective or impractical to use with human patients. The cost of bringing a
drug candidate through the necessary clinical trial and regulatory approvals is
very high and will require us to seek substantial financing through various
sources including the issuing of more stock, the borrowing of funds secured by
financial instruments such as bonds or agreements with major pharmaceutical
companies. We risk not be able to secure such funding in the necessary amounts
or on sufficiently favorable terms.

Nymox holds global patent rights covering both methods for using spherons as
targets for developing drugs and for the actual drug candidates discovered.

NEURAL THREAD PROTEIN BASED DRUGS

Nymox also developed a unique drug screening system, based on the research that
led to its AlzheimAlert(TM) test, to identify other potential drug candidates
for the treatment of Alzheimer's disease. There is a substantial body of
evidence showing that NTP may play a key role in Alzheimer's disease. The most
recent study was published in the Journal of Neuropathology and Experimental
Neurology (60: 195-207) by Dr. Suzanne de la Monte and Dr. Jack Wands of Brown
University. In the experiment, Dr. de la Monte and Dr. Wands implanted the gene
that produces NTP in nerve cells derived from humans. They then caused the cells
to turn on the implanted NTP gene and to begin to produce NTP in elevated
quantities. This caused a marked

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increase in nerve cell death. Sophisticated analysis showed that the cells died
in a programmed fashion similar to the way the nerve cells in brains of patients
with Alzheimer's disease die. Extensive loss of brain cells and accompanying
brain shrinkage is a key part of the Alzheimer's disease process. Nymox screened
compounds for their ability to impede this process of premature cell death and
thus potentially help slow or halt the loss of brain cells in the Alzheimer's
disease brain. Nymox licensed this technology in 1997 from the Massachusetts
General Hospital as part of a sponsored research and licensing agreement.

STATIN DRUGS AS A POSSIBLE PREVENTIVE TREATMENT FOR ALZHEIMER'S DISEASE

In November, 1999, Dr. Ben Wolozin of Loyola University Medical Center in
Chicago reported at the annual meeting of the Society for Neuroscience his
findings that some members of a class of anti-cholesterol drugs called statins
may delay or prevent the onset of Alzheimer's disease. Dr. Wolozin licensed the
commercial and patent rights to this discovery to Nymox. He and his fellow
researchers subsequently published their findings in the Archives of Neurology
(2000:1439-43).

NEW ANTIBACTERIAL AGENTS AGAINST INFECTIONS AND FOOD CONTAMINATION

Outside of the area of the treatment and diagnosis of Alzheimer's disease, we
are developing a new class of antibacterial agents for the treatment of urinary
tract and other bacterial infections in humans which have proved highly
resistant to conventional antibiotic treatments and for the treatment of E. coli
0157:H7 bacterial contamination in hamburger meat and other food and drink
products.

In the last ten years there has been a growing recognition of the increasing
problem of antibiotic-resistant infections and the need for truly novel
antibacterial drugs. See, for example, the European Commission report dated May
28, 1999, "Opinion of the Scientific Steering Committee on Antimicrobial
Resistance" and the report from the Interagency Task Force on Antimicrobial
Resistance, co-chaired by the Centers for Disease Control and Prevention, the
U.S. Food and Drug Administration and the National Institutes of Health,
entitled A Public Health Action Plan to Combat Antimicrobial Resistance released
on January 19, 2001.

In the field of infectious disease treatments, Nymox has developed three new
antibacterial agents:

     -    NXB-4221 for the treatment of difficult chronic and persistent urinary
          tract infections;

     -    NXB-5886 for the treatment of streptococcal infection; and

     -    NXT-1021 for the treatment of staphylococcal infection.

Urinary tract infections in women caused by bacteria such as E. coli have become
increasingly resistant to conventional antibiotic treatment. Some varieties of
streptococcus and staphylococcus bacteria, a common source of infection in
humans, have acquired a broad immunity to antibiotic treatments. Infections from
these antibiotic resistant bacteria are difficult to

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treat and can be life threatening. Nymox's three antibacterial agents have all
shown the ability to kill their bacterial targets in culture with no signs of
toxicity.

E. coli contamination of food and drink is a serious public health problem
worldwide and a major concern for meat processors in particular. E. coli
bacteria occur normally and usually harmlessly in the gastrointestinal tracts of
humans, cows and other animals. However, one mutant variety of the E. coli
bacteria, E. coli 0157:H7, can cause life-threatening illness and has been
implicated in cases of severe diarrhea, intestinal bleeding and kidney failure,
leading, in some cases, to death in children and the elderly. E. coli
contamination in hamburger meat and other food products and in drinking water
affects about 100,000 people a year.

There is a well-recognized need in the beef industry to address the problem of
E. coli contamination in meat processing and in livestock. E. coli contamination
has triggered massive recalls of ground beef both in the U.S. and in Canada.
Cattle are a natural reservoir for the deadly strain of E. coli. Water
contamination from cattle operations have led to such public health tragedies
such as occurred in Walkerton, Ontario where seven people died and 2,300 became
ill as a result of such contamination.

Nymox developed a potent new antibacterial agent, NXC-4720. Tests of NXC-4720
show it to be highly effective against all known substrains of E. coli 0157:H7,
the bacteria implicated in these severe cases of food and drink contamination.
Tests of NXC-4720 show that it destroys E. coli 0157 strains, including H7,
efficiently, rapidly and at a very low dose. In 1999, we began further trials
for this agent and are continuing trials with various collaborators, including
the Faculty of Veterinary Medicine at the University of Montreal, the Department
of Food Science at the University of Manitoba and BioPhage Inc. Nymox has patent
rights to these and other antibacterial agents.

PROPERTY, PLANTS AND EQUIPMENT

Nymox and Serex laboratory facilities in Maywood, New Jersey comprise 4,687
square feet of leased space. That lease agreement expires February 28, 2005.
Nymox office and research facilities in St. Laurent, Quebec, Canada comprise
6,923 square feet of leased space. The lease agreement expires on August 31,
2003. Nymox Pharmaceutical Corp. and its two US subsidiaries Nymox Corp. and
Serex, Inc. own a full complement of equipment used in all aspects of their
research and development work and the Nymox reference laboratory. Nymox believes
that its facilities are adequate for its current needs and that additional
space, if required, would be available on commercially reasonable terms.

GOVERNMENTAL REGULATION

Our AlzheimAlert(TM) test which we provide as a service through our clinical
reference laboratory in Maywood, New Jersey is subject to extensive government
regulation in the United States. Our clinical reference laboratory and its
performance of the AlzheimAlert(TM) must be certified by the Health Care
Financing Administration (HCFA) under the Clinical Laboratories Improvement Act
of 1988 (CLIA), which establishes quality standards for the laboratory tests
being performed to ensure the accuracy, reliability and timeliness of patient
test results. In

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addition, some individual states such as New York State have their own
requirements for the inspection and certification of reference laboratories
which offer diagnostic services for patients within the state. Finally, the FDA
has its own regulations governing in vitro diagnostic products, including
analyte-specific reagents used in clinical reference laboratories. Any changes
in our current certification status, HCFA or state law requirements or in the
FDA regulations could have an impact on our ability to offer or market any
reference laboratory services and/or on our ability to obtain reimbursement from
the Medicare and Medicaid programs and providers.

We plan to seek FDA approval for the marketing, distribution and sale of our
AlzheimAlert(TM) test, outside of the clinical reference laboratory setting in
the United States. Such approval for this type of commercial development is
necessary for all in vitro diagnostic devices like our AlzheimAlert(TM) test.

The regulatory process leading to such approval can be time-consuming and
expensive and can result in an outright denial or a very limited approval only.
Our product will be subject to subject to premarketing and postmarketing
requirements applicable to such devices, including those governing:

     i)    clinical testing;

     ii)   design control procedures;

     iii)  prior FDA approval of a 510(k) application, where the FDA has
           determined that our diagnostic device is substantial equivalent to a
           marketed device, or a premarket approval application, where the FDA
           has been satisfied with clinical studies demonstrating the safety and
           efficacy of our device;

     iv)   postmarketing record and reporting obligations; and

     v)    good manufacturing practices.

The requirements for a premarket approval application are analogous to those for
the approval of a new drug and include four categories of information:
indications for use, device description and manufacturing methods, alternative
practices and procedures for the diagnosis of the disease and clinical and
nonclinical studies. The requirements for a 510(k) application are generally
less onerous but still include indications for use, safety and effectiveness
data as well as manufacturing and quality assurance data and information. There
can be no assurance that the AlzheimAlert(TM) test or any other medical device
that we may develop in the future will obtain the necessary approvals within a
specified time framework, if ever. In addition, the FDA may impose certain
postmarketing requirements that may significantly increase the regulatory costs
associated with our product. The FDA has recourse to a wide range of
administrative sanctions and civil and criminal penalties in order to enforce
the applicable laws, rules and regulations.

Our therapeutic products under development by Nymox would also have to receive
regulatory approval. This is a costly, lengthy and risky process. In the United
States, in order for a product to be marketed, it must go through four distinct
development and evaluation stages:

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     Product Evaluation.

     We must conduct preliminary studies of potential drug candidates using
     various screening methods to evaluate them for further testing, development
     and marketing.

     Optimization of Product Formulation.

     The activities in this stage of development involve consultations between
     us and investigators and scientific personnel. Preliminary selection of
     screening candidates to become product candidates for further development
     and further evaluation of drug efficacy is based on a panel of research
     based biochemical measurements. Extensive formulation work and in vitro
     testing are conducted for each of various selected screening candidates
     and/or product candidates.

     Clinical Screening and Evaluation.

     During this phase of development, portions of which may overlap with
     product evaluation and optimization of product formulation, initial
     clinical screening of product candidates is undertaken and full scale
     clinical trials commence. The FDA must approve any clinical testing on
     healthy subjects (Phase 1) and on patients (Phase 2 and 3).

     Final Product Development.

     The activities to be undertaken in final product development include
     performing final clinical evaluations, conducting large-scale experiments
     to confirm the reproducibility of clinical responses, making clinical lots
     for any additional extensive clinical testing that may be required,
     performing any further safety studies required by the FDA, carrying out
     process development work to allow pilot scale production of the product,
     completing production demonstration runs for each potential product, filing
     new drug applications, product license applications, investigational device
     exemptions (and any necessary supplements or amendments) and undergoing
     comprehensive regulatory approval programs and processes.

We cannot assure you that we will successfully complete the development and
commercialization of any therapeutic products.

In the United States, obtaining the necessary FDA approval for any drug is a
lengthy, expensive and often arduous process. We cannot predict with any
certainty the amount of time the FDA will take to approve one of our drugs or
even whether any such approval will be forthcoming. Similar requirements exist
in many other countries.

In the United States, the FDA approval procedure is a two-step process. We must
file an investigational new drug application for each product with the FDA
before beginning the initial (Phase I) clinical testing of the new drug in
healthy subjects. If the FDA has not commented on or questioned the application
within 30 days of its filing, initial clinical studies may begin. If, however,
the FDA has comments or questions, the questions must be answered to the
satisfaction of the FDA before initial clinical testing can begin. In some
instances, this process could result

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in substantial delay and expense. Phase I studies are intended to demonstrate
the functional characteristics and safety of a product.

After Phase I testing, we must conduct extensive clinical trials with patients
in order to establish the efficacy and safety of our drug. Once we complete the
required clinical testing, we expect to have to file a new drug application for
FDA approval in order to market most, if not all, of our new drugs. The
application is complicated and detailed and must include the results of
extensive clinical and other testing, the cost of which is substantial. The FDA
conducts an extensive and often lengthy review of such applications. The agency
is required to review applications within 180 days of their filing, but, during
the review, frequently requests that additional information be submitted. This
starts the 180-day regulatory review period anew when the requested additional
information is submitted and, as a result, can significantly extend the review
period. Until the FDA actually approves the new drug application, there can be
no assurance that the agency will consider the information requested and
submitted to justify approval. The packaging and labeling of products are also
subject to FDA regulation. Accordingly, it is impossible to anticipate when the
FDA will approve a new drug application.

We must also obtain approval for our drugs or diagnostic devices from the
comparable regulatory authority in other countries before we can begin marketing
our product in that country. The approval procedure varies from country to
country and can involve additional testing. The time required may differ from
that required for FDA approval. Although there are some procedures for unified
filings for certain European countries, in general each country has its own
procedures and requirements, many of which are time-consuming and expensive.
Thus, there can be substantial delays in obtaining required approvals from both
the FDA and foreign regulatory authorities after the relevant applications are
filed.

After such approvals are obtained, further delays may be encountered before the
products become commercially available. If, subsequent to approval, new
information becomes available concerning the safety or effectiveness of any
approved product, the regulatory authority may require the labeling for the
affected product to be revised or the product to be withdrawn. Our manufacturing
of any approved drug must conform with the FDA's good manufacturing practice
regulations which govern the production of pharmaceutical products and be
subject to inspections and compliance orders.

Government regulation also affects our ability to receive an appropriate level
of reimbursement for our products. Throughout the developed world, both public
and private health care plans are under considerable financial and political
pressure to contain their costs. The two principal methods of restricting
expenditures on drugs and diagnostic products and services are to deny coverage
or, if coverage is granted, to limit reimbursement. For single-payer government
health care systems, a decision to deny coverage or to severely restrict
reimbursement for one of our products can have an adverse effect on our business
and revenues.

In the United States, where, to a significant degree, the patient population for
our products is elderly, Medicare and Medicaid are sources of reimbursement. In
general, any restriction on reimbursement, coverage or eligibility under either
program could adversely affect reimbursement to Nymox for products and services
provided to beneficiaries of the Medicare and/or Medicaid programs. Many elderly
people are covered by a variety of private health care organizations either
operating private health care plans or Medicare or Medicaid programs

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subject to government regulation. These organizations are also under
considerable financial constraints and we may not be able to secure coverage or
adequate reimbursement from these organizations. Without coverage, we will have
to look to the patients themselves who may be unwilling or unable to pay for the
product; in turn, doctors may be reluctant to order or prescribe our products in
the absence of coverage of the product for the patient.

In response to rising health care costs, the U.S. Congress implemented sweeping
changes to the U.S. Medicare and Medicaid systems in the Balanced Budget Act of
1997 and is currently considering a number of other proposals that could
significantly impact on the level of funding for Medicare and Medicaid programs.
Under the new Part C: Medicare + Choice programs, beneficiaries can now opt for
a variety of health delivery models, including coordinated care plans, HMOs,
preferred provider organizations and provider sponsored organizations, private
fee-for-service plans and medical savings account plans. In addition, states now
have the option to require Medicaid recipients to enroll with managed health
care plans without first obtaining a waiver, making it substantially easier for
the states to meet their Medicaid obligations through private managed care
organizations. All these health care delivery systems, including the original
Medicare and Medicaid systems, are subject to funding formulas and spending caps
and may compensate for these restrictions by limiting coverage, eligibility
and/or payments. The long-term impact of these legislative changes in terms of
their efficiency, effectiveness and financial viability in delivering health
care services to an aging population is uncertain at present. Any legislative or
regulatory actions to reduce or contain federal spending under either the
Medicare or Medicaid programs could adversely affect our ability to participate
in either program as a provider or supplier of services or products and the
amount of reimbursement under these programs potentially available to us.

Our AlzheimAlert(TM) test, and any of the new diagnostic and therapeutic
products and services that we may develop, will be subject to coverage
determinations by health care providers and payers. Federal and state
regulations and law and internal coverage policies of health care organizations
affect our ability to obtain payments for our products and services. The
Medicare program will not pay for any expenses incurred for items or services
that are not reasonable and necessary for the diagnosis or treatment of illness
or injury or to improve the functioning of a malformed body member.
Historically, HCFA interpreted this provision in order to exclude from Medicare
coverage those medical and health care services that are not demonstrated to be
safe and effective by acceptable clinical evidence. HCFA recently revised both
its national coverage policies and procedures in general and specifically its
coverage of diagnostic laboratory tests and constituted a Medicare Coverage
Advisory Committee to provide advice on the effectiveness and appropriateness of
medical items and services that are eligible for coverage under Medicare. It is
unknown how these changes will affect our ability to obtain Medicare coverage
for its products and services. However, an adverse national coverage decision
with respect to one of our products or services will make it impossible to
receive reimbursement from Medicare for that product and more difficult to
convince private health care organizations to provide coverage for it. Even if
we receive a favorable coverage decision for one of our products or services,
there is no guarantee that the level of reimbursement for it will be close to
our retail price for it or commensurate with the costs of developing and
marketing it.

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PATENTS AND PROPRIETARY INFORMATION

We believe that patent and trade secret protection is important to our business,
and that our success will depend, in part, on our ability to obtain strong
patents, to maintain trade secret protection and to operate without infringing
the proprietary rights of others.

The commercial success of products incorporating our technologies may depend, in
part, upon our ability to obtain strong patent protection. We cannot assure you
that additional patents covering new products or improvements will be issued or
that any new or existing patents will be of commercial benefit or be valid and
enforceable if challenged.

We pursue a policy of seeking patent protection for valuable patentable subject
matter of our proprietary technology and require all employees, consultants and
other persons who may have access to its proprietary technology to sign
confidentiality agreements.

Nymox has patents issued and allowed and patent applications pending in the
United States and selected countries including Canada, most European countries,
Australia and Japan. These patents and patent application cover much of our
current product development and technologies, including:

     -   new drug candidates for the treatment of Alzheimer's disease;

     -   proprietary screening technologies for finding therapeutic drugs for
         Alzheimer's disease. These screening technologies consist of biological
         systems and defined conditions used to determine if a drug candidate
         possesses a useful action that can predict its potential for use in
         humans or animals. For example, Nymox patented screening methods that
         show whether a potential drug can inhibit or arrest some of the
         pathological changes of Alzheimer's disease. As a second example, Nymox
         patented screening methods that show whether a potential drug can
         modify in a useful way the amounts of chemical markers of Alzheimer's
         disease in a subject. While no proven therapeutic drugs for AD have yet
         been found using these screening technologies, they are a useful
         component to our drug development program. (See "Development of
         Therapeutic Products for Alzheimer's Disease" above.)

     -   unique proteins which are related to Alzheimer's disease and which may,
         after further research and clinical trials, prove useful in either
         diagnostic or therapeutic applications;

     -   promising diagnostic markers for Alzheimer's disease;

     -   new diagnostic assay methods;

     -   methods of treating meat and other food products for E. coli
         contamination; and

     -   anti-infective agents.

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Nymox has nine patents in the United States and a corresponding larger number of
patents worldwide relating to the inventions and discoveries in those patents.

Nymox also has an exclusive license to a family of patents from the
Massachusetts General Hospital covering rights to the NTP diagnostic and
therapeutic products, including AlzheimAlert(TM). Under this license, the
Massachusetts General Hospital is entitled to royalties of 4% from worldwide
sales of the AlzheimAlert(TM) test. The earliest of these patents expires in the
year 2013. Nymox also has a similar research and license agreement with Rhode
Island Hospital, where the principal researchers, Dr. Suzanne de la Monte and
Dr. Jack Wands, now conduct their research into NTP, the brain protein detected
by our AlzheimAlert(TM) test, covering new developments and discoveries in this
area not otherwise covered by the Massachusetts General Hospital agreement.

Nymox's affiliate, Serex, Inc., in which it recently acquired a controlling
interest, also actively pursues a policy of seeking patent protection for its
patentable technologies and discoveries in the United States and in selected
other countries including some European countries, Canada, Australia and Japan.
Its patents issued and allowed and patent applications pending cover such areas
of its technologies and discoveries as:

     -    its particle valence technology which can detect very small amounts of
          biochemical indicators for diseases, conditions and drug use in body
          fluids such as blood, urine and saliva.

     -    a test that can detect biochemical indicators of cholesterol in human
          saliva and therefore provide a method of determining and monitoring
          cholesterol levels; and

     -    an antibody, which, used in Serex's proprietary technology, can detect
          one of the biochemical indicators for the loss of bone matter, which
          is a sign of osteoporosis, the most common bone disease in man.

Many companies have patents covering various drugs, methods and discoveries in
the fields of diagnostics and therapeutics for Alzheimer's disease and related
conditions and of new anti-infective agents. We believe that the patents issued
to date will not preclude Nymox from developing and marketing our products;
however, it is impossible to predict the extent to which licenses from third
parties will be necessary. If Nymox were to need licenses from third parties
there can be no assurance that we could obtain such licenses on commercially
reasonable terms, if at all.

In the fields of diagnostic methods and diagnostic tests for common human
diseases and conditions, where Serex has many of its patents, there are many
patents issued covering many areas of diagnostic methods, tests and
technologies. We believe that these patents issued to date to other companies
will not preclude Serex from developing and marketing its products but you
should be aware that it is often difficult to determine the nature, breadth and
validity of competing patent claims in these fields, that there has been
significant litigation in some of these areas (not involving Serex) and that, if
and when Serex's products become more commercially successful, Serex's products
or patents may become the subject matter of litigation. If Serex

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were to need licenses from third parties there can be no assurance that it
could obtain such license on commercially reasonable terms, if at all.

Neither Nymox nor Serex are currently involved in litigation over patent and
other intellectual property rights but significant litigation over these matters
in the pharmaceutical and biotechnology industry is not uncommon. The validity
and extent of patent rights can be very difficult to determine and involve
complex legal, factual and scientific questions. Important legal issues about
patent protection in the field of biotechnology have not been resolved. Patent
litigation is costly and time-consuming and can consume substantial resources.
An adverse decision can preclude the marketing of a product, expose us to
significant liabilities or require us to obtain third party licenses which may
not be available at commercially reasonable prices.

We also rely upon trade secrets, know-how, and continuing technological
advancement to develop and maintain our competitive position. We control the
disclosure and use of our know-how and confidential information through
agreements with the parties involved. In addition, we have confidentiality
agreements with our key employees, consultants, officers and directors. There
can be no assurance, however, that all confidentiality agreements will be
honored, that others will not independently develop equivalent technology, that
disputes will not arise as to the ownership of intellectual property, or that
disclosure of our trade secrets will not occur. Furthermore, there can be no
assurance that others have not obtained or will not obtain patent protection
that will exclude us from using our trade secrets and confidential information.
To the extent that consultants or research collaborators use intellectual
property owned by others in their work with us, disputes may also arise as to
the rights to related or resulting know-how or inventions.

COMPETITION

Rapidly evolving technology and intense competition are the hallmarks of modern
pharmaceutical and biotechnology industries. Our competitors include:

     -    major pharmaceutical, diagnostic, chemical and biotechnology
          companies, many of which have financial, technical and marketing
          resources significantly greater than ours;

     -    biotechnology companies, either alone or in collaborations with large,
          established pharmaceutical companies to support research, development
          and commercialization of products that may be competitive with ours;
          and

     -    academic institutions, government agencies and other public and
          private research organizations which are conducting research into
          Alzheimer's disease and which increasingly are patenting, licensing
          and commercializing their products either on their own or through
          joint ventures.

In the field of Alzheimer's disease diagnosis, our AlzheimAlert(TM) test faces
growing competition which could detrimentally impact on our ability to
successfully market and sell our diagnostic test. Our competitors include:

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     -    Athena Diagnostics, Inc. which is currently marketing three tests
          claimed to aid in the diagnosis of Alzheimer's disease: a genetic test
          for the rare cases of familial, early-onset Alzheimer's disease; a
          genetic test for a relatively common mutation of a gene said to
          increase the likelihood of a person with at least one of the genes
          contracting the disease; and a test for two proteins in the spinal
          fluid of patients.

     -    Mitokor, Inc. which developed a blood test known as Mito-Load that
          looks for certain mutations in mitochondrial DNA said to be associated
          with Alzheimer's disease. Mitokor recently entered into a
          non-exclusive licensing agreement in Japan for the marketing and sale
          of its product there.

     -    Synapse Technologies, Inc. which developed a blood test known as p97
          Diagnostic that detects a protein said to be diagnostic of Alzheimer's
          disease. Synapse Technologies also licensed its technology for use in
          Japan.

     -    NeuroLogic, Inc., which announced in September, 1999 that it acquired
          an exclusive world-wide license to a cellular test for Alzheimer's
          disease.

     -    Axonyx Inc., which announced in July, 2000 findings that two enzymes
          to which it had acquired world-wide exclusive rights,
          butrylcholinesterase and acetylcholinesterase, were elevated in the
          cerebrospinal fluid of patients with Alzheimer's disease.

There are also a number of other proposed biochemical signs of the disease that
could potentially be developed into a commercial diagnostic test as well as
various scanning and imaging technologies which might compete some day for a
portion of the diagnostic market for Alzheimer's disease.

We also face intense competition for the development of an effective treatment
for Alzheimer's disease. The market conditions for an Alzheimer's disease drug
strongly favor the entry of other corporations into the area. The current market
for therapeutic drugs for Alzheimer's disease is an estimated $2 billion. This
market is expected to grow rapidly as new drugs enter the market and as the baby
boom generation becomes more at risk for developing Alzheimer's disease. As a
result, most of the major pharmaceutical companies and many biotechnology
companies have ongoing research and development programs for drugs and
treatments for Alzheimer's disease. Many of these companies have much greater
scientific, financial and marketing resources than we have and may succeed in
developing and introducing effective treatments for Alzheimer's disease before
we can. At present, only one drug for Alzheimer's disease is being widely
marketed in the United States, Aricept by Pfizer. Aricept only treats some of
the symptoms of Alzheimer's disease by enhancing memory and other mental
functions and not the underlying causes of the illness.

A similar competitive reality prevails in the field of novel anti-infectives.
Over the past ten years, there has been an increasing awareness of the medical
need and of emerging market opportunities for new treatments for antibiotic
resistant bacterial infections. Many of the major pharmaceutical companies are
developing anti-infective drugs that either modify their existing drugs or
involve new anti-bacterial properties. Many biotechnology companies are
developing new classes of anti-bacterial drugs. At least three major
pharmaceutical companies have

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vaccines against bacterial infections in development. To the extent that these
companies are able to develop drugs or vaccines that offer treatment for some or
all of the indications for our anti-infectives, the market for our products may
be adversely affected.

The problem of E. coli 0157:H7 contamination of hamburger meat and other food
products is also well-known and a number of companies and researchers have been
pursuing various potential solutions, including irradiation with x-rays, better
detection of contamination, electronic pasteurization, vaccination and
competitive exclusion of the pathogenic E. coli bacteria by harmless bacteria.
The development of alternative solutions to the problem of E. coli infection may
adversely affect the market for our treatment for E. coli 0157:H7 infection in
cattle and contamination of food products.

MARKETING

We currently market our AlzheimAlert(TM) test as a clinical reference laboratory
service primarily in the United States. We are also marketing the Serex
NicAlert(TM) test, which can determine whether a person is using tobacco
products, in the United States through our own marketing arm and through a
distribution agreement with Jant Pharmacal Corporation and in Japan with Mizuho
Medy Co. Ltd. of Japan. We have not started to commercially market or distribute
any of our other products under development and most of them will require
regulatory approval in each country before being marketed there.

At present, we have a network of over 40 independent medical representatives and
do most of our marketing ourselves. To increase our marketing, distribution and
sales capabilities both in the United States and around the world, we will need
to enter into licensing arrangements, contract sales agreements and co-marketing
deals. We cannot assure you that we will be able to enter into agreements with
other companies on terms acceptable to us, that any licensing arrangement will
generate any revenue for the company or that the costs of engaging and retaining
the services of a contract sales organization will not exceed the revenues
generated.

If successfully developed and approved, we plan to market and sell our
therapeutic and diagnostic products directly or through co-promotion
arrangements or other licensing arrangements with third parties. In cases where
we have sole or shared marketing rights, we plan to build a small, focused sales
force if and when such products approach marketing approval in some markets,
including Europe. Implementation of this strategy will depend on many factors,
including the market potential of any products we develop as well as on our
financial resources. To the extent we will enter into co-promotion or other
licensing arrangements, any revenues received by us will be dependent on the
efforts of third parties.

ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS

GENERAL

We are a development stage biopharmaceutical company that specializes in the
research and development of therapeutics and diagnostics for the aging
population with an emphasis on Alzheimer's disease.

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We have begun to market the AlzheimAlert(TM) test, which we provide in our
clinical reference laboratory, that is an aid to the diagnosis of Alzheimer's
disease.

We also have under development therapeutic agents for the treatment of
Alzheimer's disease and of certain antibiotic-resistant infections as well as
antibacterial agents for E. coli contamination of food and drink products.

We also recently acquired a majority interest in Serex, Inc., a New Jersey
company specializing in diagnostic products.

AlzheimAlert(TM) is an improved version of our AD7C(TM) test, from which we
began generating revenue from sales in 1997.

All figures are presented in U.S. dollars, unless otherwise stated.

LIQUIDITY AND CAPITAL RESOURCES

We fund our operations and projects primarily by selling shares of Nymox's
common stock. However, since 1997, a small portion of our funding came from
service revenues. This source of funding became more significant in late 1998,
following the launch of our urinary version of the AD7C(TM) test. Since its
incorporation in May, 1995, Nymox raised the capital necessary to fund its
on-going research and development work and its marketing and sales operations
primarily through private placements of its shares.

On December 1, 1997, the shares began trading on the Nasdaq Stock Market.
Nymox's common shares also traded on the Montreal Exchange from December 18,
1995 to November 19,1999.

Private placements completed by Nymox since December, 1995 are as follows:

     -    December 1995, 1,578,635 common shares at a price of CAN$2.00
          (US$1.38) per share for total proceeds of CAN$3,157,270
          (US$2,187,536);

     -    April 1996, 877,300 common shares at a price of CAN$6.00 (US$4.15) per
          share for total proceeds of CAN$5,263,800 (US$3,647,059);

     -    May 1997, 696,491 common shares at a price of CAN$6.50 (US$4.50) and
          warrants exercisable at a price of CAN$8.50 (US$5.88) per share for
          total proceeds of CAN$4,527,191 (US$3,136,694). In 1998, all 696,491
          of these warrants were exercised for additional proceeds to Nymox of
          CAN$5,920,174 (US$4,101,832);

     -    May 1998, 231,630 common shares at a price of CAN$8.50 (US$5.88) for
          total proceeds of CAN$1,968,855 (US$1,364,134). A total of 110,000
          warrants were issued as well, exercisable at a price of CAN$8.50
          (US$5.88) per share (50,000) and CAN$10.00 (US$6.93) per share
          (60,000). These warrants have since expired;

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     -    December 1998, 135,000 common shares and January 1999, 55,000 common
          shares at CAN$8.50 (US$5.88) per share, for total proceeds of
          CAN$1,615,000 (US$1,118,963). A total of 95,000 warrants were issued
          as well, exercisable at the price of CAN$10.00 (US$6.93) per share.
          These warrants have since expired;

     -    September 1999, 122,000 common shares at CAN$5.00 (US$3.46) per share,
          for total proceeds of CAN$610,000 (US$422,642).

     -    March 2000, 821,637 common shares at an average price of $4.87 per
          share, for total proceeds of $4,000,000. A total of 93,334 warrants
          were issued as well, exercisable at a price of $9.375 per share
          (66,667) and $7.8125 per share (26,667). These warrants expire on
          March 6, 2004.

     -    March, 2001, 200,000 common shares at $2.06 per share, for total
          proceeds of $412,000. A total of 100,000 warrants were issued as well,
          exercisable at a price of $2.06. These warrants expire on March 6,
          2003.

As well, on March 14, 2000, we became entitled to draw down on the $12 million
equity line of credit with Jaspas Investments Limited, a British Virgin Islands
corporation, through a common stock purchase agreement dated November 1,1999 for
the future issuance and purchase of Nymox's common shares. We expect the stock
purchase agreement with Jaspas to provide significant, long-term financing that
will enable us to advance our research and product development for the next
three years. We plan to seek additional capital within the limits on financing
contained in the common stock purchase agreement in order to accelerate product
development and marketing and obtaining necessary regulatory approvals.

You should refer to our F-1 Registration Statement filed with the SEC on
February 29, 2000 and declared effective on March 14, 2000 for the details of
our agreement with Jaspas. In general, the draw down facility created by the
facility operates like this: the investor, Jaspas, committed up to $12 million
to purchase Nymox's common shares of Nymox over a thirty month period. Once a
month, Nymox may request a draw of up to $750,000 of that money, subject to a
formula based on average stock price and average trading volume, setting the
maximum amount of any request for any given draw. At the end of a 22 day trading
period following the draw down request, the amount of money that Jaspas will
provide to Nymox and the number of shares Nymox will issue to Jaspas in return
for that money is settled based on the formula in the stock purchase agreement.
Jaspas receives a six (6%) percent discount to the market price for the 22 day
period and Nymox receives the settled amount of the draw down less a 3%
placement fee payable to its placement agents, Ladenburg Thalmann & Co. Inc. and
Paul Revere Capital Corp.

The facility is based on a "use-it-or-lose" principle. We are under no
obligation to request a draw for any month. However if we do not request a draw
for a given month, we may never to be able to draw those funds again. We may
make up to a maximum of twenty-four (24) draws.

In lieu of providing Jaspas with a minimum draw down commitment, we agreed to
issue to Jaspas a stock purchase warrant to purchase up to 200,000 shares of our
common stock with an exercise price of 110% of our share price on the closing
date of November 12, 1999 or $4.53. Jaspas may purchase under the warrant up to
100,000 Nymox shares any time between

                                       27
28

November 30, 1999 and November 30, 2004. Jaspas may purchase the remaining
100,000 shares if and only if we do not draw down at least $7 million within 18
months of March 14, 2000.

As of March 31, 2001, the following drawings have been made under this Share
Purchase Agreement, for total proceeds of $1,327,273:

     -    August 16, 2000, 152,616 common shares at a volume weighted average
          price of US$3.2924 per share;

     -    October 12, 2000, 137,889 common shares at a volume weighted average
          price of US$3.6261 per share; and

     -    February 7, 2001, 161,696 common shares at a volume weighted average
          price of US$2.0240 per share.

Also, the Company has received a total proceeds of $335,025.00 (CAN$483,925)
from the exercise of 148,900 options at a price of $2.25 (CAN$3,25) since 1995.

Pursuant to the share purchase agreement entered into to acquire a controlling
interest of Serex, Inc., a total of 256,675 additional shares and 157,952
warrants were issued in exchange for the shares of Serex (see Note 5 "Business
Acquisition" in the financial statements).

In total, Nymox has raised over $23 million, since its incorporation in May
1995.

We have no financial obligations of significance other than long-term lease
commitments for our premises in the United States and Canada of $15,098 per
month in 2001 and ongoing research funding payments to a U.S. medical facility
totaling $172,000 for 2001. Total commitments beyond 2001 are summarized in note
7 to the consolidated financial statements.

RESULTS OF OPERATIONS

YEAR ENDED DECEMBER 31, 2000 COMPARED TO YEAR ENDED DECEMBER 31, 1999

Overview

Since inception, the Company has focused its activities on developing certain
pharmaceutical technologies and obtaining outside funding to support the
continued development of its technologies. The Company has incurred losses since
inception of operations. Future profitability will depend on the Company's
ability to generate revenues from the sale of products and the licensing of
technology sufficient to offset the expenditures required to further the
Company's research and development program and ongoing operations. See Item 4
for a description of the projects in the Company pipeline.

Effective January 1, 2000, the Company adopted the US dollar as its measurement
currency. See note 2(a) to the consolidated financial statements. All amounts
presented are in US dollars.

                                       28
29

During the year, the Company acquired a majority interest in Serex, Inc. for a
consideration comprising common shares, warrants and options having a value of
approximately $1.3 million. See note 5 to the consolidated financial statements.

Revenue

Revenues from sales amounted to $157,688 for the year ended December 31, 2000,
compared with $153,252 for the year ended December 31, 1999. Sales for fiscal
2000 include the revenues from sales of the diagnostic test AlzheimAlert(TM) and
its predecessor AD7C(TM), the price for which was reduced in 2000, and of the
NicAlert(TM) test, since the date of acquisition of Serex. Interest revenue was
$68,179 in 2000 compared to $36,951 in 1999, derived from interest earned on the
Company's cash balances.

Expenses

Research and development expenditures were $2,084,232 for the year ended
December 31, 2000, compared with $1,137,122 for the year ended December 31,
1999, reflecting increased expenditures in the development of the products in
the Company's existing pipeline, as well as development of the potential
products acquired with the acquisition of Serex Inc. In 2000, research tax
credits amounted to $10,457 compared to $4,181 in 1999.

Management restructured its marketing activities resulting in a decrease in
expenditures to $363,142 for the year ended December 31, 2000 compared to
$942,205 for the year ended December 31, 1999.

General and administrative expenses amounted to $1,335,500 for the year ended
December 31, 2000, compared with $1,229,894 in the year ended December 31, 1999.
The increase was principally due to the acquisition of Serex Inc. in 2000.

Net losses for the period ended December 31, 2000 were $4,023,979, or $0.19 per
share, compared to $3,314,296, or $0.17 per share, for the same period in 1999.
The weighted average number of common shares outstanding for the period ending
December 31, 2000 were 20,890,735 compared to 19,886,430 for the same period in
1999.

Liquidity And Capital Resources

As of December 31, 2000, cash totaled $565,711. In November 1999, the
Corporation signed a common stock purchase agreement whereby the investor is
committed to purchase up to $12 million of the Corporation's common shares over
a thirty-month period commencing March 2000, when our F-1 registration statement
was declared effective. In 2000, two drawings were made under this Share
Purchase Agreement, for total proceeds of $1,000,000. Specifically, on August
16, 2000, 152,616 common shares were issued at a volume weighted average price
of US$3.2924 per share and on October 12, 2000, 137,889 common shares were
issued at a volume weighted average price of US$3.6261 per share. The Company
intends to access financing under this agreement when appropriate to fund its
research and development. The Company believes that the cash available under
this Share Purchase Agreement, along with the revenues generated by sales, will
be sufficient to finance its operations through 2001.

The Company invested $381,565 in additional capital assets in the year ended
December 31, 2000, consisting mostly of patent costs, compared to $164,783 in
the same period in 1999.

                                       29
30
YEAR ENDED DECEMBER 31, 1999 COMPARED TO YEAR ENDED DECEMBER 31, 1998

Revenue

Revenues on service fees for the AD7C(TM) test amounted to $153,252 for the
year ended December 31, 1999, compared with $104,804 for the year ended December
31, 1998. All of the service fee revenue was derived from our AD7C(TM) urine
test service offered in our clinical reference laboratory. Interest revenue was
$36,951 in 1998 compared to $168,761 in 1997, derived from interest earned on
the cash and short-term investments received from the private placements
referred to previously.

Expenses

Research and development activities were reorganized resulting in a decrease in
expenditures to $1,137,122 for the year ended December 31, 1999, compared with
$2,091,745 for the year ended December 31, 1998. In 1999, research tax credits
amounted to $4,181 compared to $4,003 in 1997.

Management restructured its marketing activities resulting in a decrease in
expenditures to $942,205 for the year ended December 31, 1999 compared to
$2,245,023 for the year ended December 31, 1998.

General and administrative expenses amounted to $1,229,894 for the year ended
December 31, 1999, compared with $550,269 in the year ended December 31, 1998.
This rise is attributable to an increase in professional fees and in
administrative personnel.

Net losses for the period ended December 31, 1999 were $3,314,296, or $0.17 per
share, compared to $4,783,213, or $0.25 per share, for the same period in 1998.

YEAR ENDED DECEMBER 31, 1998 COMPARED TO YEAR ENDED DECEMBER 31, 1997

Revenue

Revenues on service fees for the AD7C(TM) test amounted to $104,804 for the
year ended December 31, 1998, compared with $17,033 for the year ended December
31, 1997. More than half of these revenues were generated in the last two months
of 1998 when we launched the urinary version of our AD7C(TM) urine test service
through our reference laboratory service. Interest revenue increased to $168,761
in 1998 compared to $53,022 in 1997, derived from interest earned on the cash
and short-term investments received from the private placements referred to
previously.

Expenses

Research and development expenditures amounted to $2,091,745 for the year ended
December 31, 1998, compared with $1,775,340 for the year ended December 31,
1997. The increase is principally attributable to increased expenditures on
reagents and clinical studies related to R&D in therapeutics and anti-infectives
at the U.S. laboratory during the year. In 1998, research tax

                                       30
31
credits amounted to $4,003 compared to $103,928 in 1997. The reduction in tax
credits is attributable to the transfer of research and development to the
United States.

Marketing expenses amounted to $2,245,023 for the year ended December 31, 1998
compared to $1,334,202 for the year ended December 31, 1997. A major marketing
effort in 1998 accounted for the increased expenditures; the effort focused
specifically on mass mailings, publicity and presentations at conferences.

General and administrative expenses amounted to $620,939 for the year ended
December 31, 1998, compared with $408,456 in the year ended December 31, 1997.
The increase is attributable to increases in professional fees and increased
costs related to shareholder relations. Increases in both areas result from
first time contracts in 1998 with shareholder relations and public relations
firms.

Net losses for the period ended December 31, 1998 were $4,783,213, or $0.25 per
share, compared to $3,463,905, or $0.19 per share, for the same period in 1997.

INFLATION

We do not believe that inflation has had a significant impact on the results of
our operations.

ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES

DIRECTORS AND SENIOR MANAGEMENT

Senator W. David Angus, QC, 63, Chairman and Director since May 13, 1999, is an
honours graduate of Princeton University (AB '59) and McGill University (BCL
'62). He is a member of the Senate of Canada, serving on the Standing Committee
on Banking, Trade and Commerce. He is also a senior partner at the Montreal
office of Stikeman, Elliott, Canada's global law firm, and a director of several
other Canadian corporations and charitable organizations, including Air Canada,
AON Reed Stenhouse, Systech Retail Systems Inc., 3D Visit Inc., Eastern Canada
Towing Ltd. and the McGill University Health Center.

Dr. Paul Averback, M.D., D.A.B.P., 50, President and Director since September
1995, is the founder of Nymox and the inventor of much of its initial
technology.  Prior to founding Nymox, Dr. Averback served as President of
Nymox's predecessor, DMS Pharmaceuticals Inc.  He received his M.D. in 1975 and
taught pathology at universities, including Cambridge University, England
(1977-1980), during which time he initiated his research on Alzheimer's disease.
He has practiced medicine in numerous Canadian institutions as well as in
private practice.  Dr. Averback has published extensively in the scientific and
medical literature.

Dr. Hans Black, MD, 47, Director since May 13, 1999, has a doctorate in medicine
from McGill University, and is Chairman and Chief Investment Officer of
Interinvest Consulting Corporation, a Montreal-based global money management
firm with offices in Toronto and Boston and affiliates in Bermuda and Zurich.
Dr. Black appears regularly on the PBS network show,

                                       31
32
Nightly Business Report, and has been a guest lecturer at Harvard, Temple and
McGill Universities.

Michael R. Sonnenreich, 62, Director since April 18, 2000, is a graduate of
Harvard University Law School, and is currently Chairman and CEO of Kikaku
America International, Senior Partner of Sonnenreich, Roccograndi & Woo P.C.,
President and CEO of Glocal Communications Corp. Ltd. of London, Vice Chairman
of PharMa International Corporation of Tokyo, Director of Asset Advisory
Services of Zurich, Member of the Board of Advisors of John Hopkins University
School of Advanced International Studies and Member of the Board of Overseers of
Tufts University Medical School. Mr. Sonnenreich has in the past been a Board
Member or a Trustee of numerous important companies and universities, and has
long-term involvements with many non-profit institutions, and served as
President of the National Coordinating Council on Drug Education.

Professor Walter P. von Wartburg, 61, Director since April 18, 2000, is a
partner in the private law practice of Law & Life Sciences in Basel,
Switzerland, specialized in biotech and drug regulatory affairs. He is a
graduate of the Universities of Basel, Paris, Princeton, Stanford and Harvard
Law School; Professor on public health policy at the Saint Gall Graduate School
of Economics, Business and Public Administration, and was a Member of the
Executive Committee of Novartis Inc. until 1999. He is author of various books
and articles on drug abuse, pharmaceutical legislation, biotechnology, and on
issues of management, communications and business administration. He is also
Chairman or Board Member of numerous institutions.

Michael Munzar, M.D., 47, Medical Director since June 1, 1996, received an M.D.
from the Faculty of Medicine, McGill University, in 1979. He practiced medicine
for over 15 years in a variety of institutional and private practice settings.
He has a diverse medical background that includes most aspects of medical care,
including geriatrics and psychiatry. He also has extensive business experience
with the establishment, operation and management of medical facilities.

Judith Fitzpatrick, Ph.D., Vice-President for Scientific Affairs, 53, received a
Ph.D. in immunology from Mt. Sinai Medical School (City College of New York) in
1981, and from 1981 to 1984 was employed by Becton Dickinson as a Senior
Scientist. She founded Serex, Inc. in 1984 and has extensive experience both in
the scientific and commercial aspects of the development of diagnostic tests.
From 1984 to the early 1990's, she developed and supervised the manufacture of
laboratory tests for drugs and proteins of interest to the life insurance
industry. Dr. Fitzpatrick is a co-inventor of Serex's patented diagnostic
system.

Jack Gemmell, B.Sc.(Hons.), LL.B., 49, General Counsel and Chief Information
Officer since July, 1998. Mr. Gemmell graduated from the Faculty of Law at the
University of Toronto in 1977 and was called to the bar in 1979. He practiced
primarily in the area of litigation for over 19 years before joining Nymox in
July, 1998 and has substantial business experience with the management and
operation of a legal practice.

Mr. Roy M. Wolvin, 46, Secretary-Treasurer and Chief Financial Officer since
September 1995. Prior to September 1995, Mr. Wolvin was Account Manager, private
business, for a Canadian chartered bank. Mr. Wolvin holds a degree in Economics
from the University of Western Ontario.

                                       32
33

COMPENSATION

a)   The table below provides compensation information for the fiscal year ended
December 31, 2000 for each executive officer of Nymox and for the directors and
executive officers as a group.

Summary Compensation Table
Fiscal Year ending                      Fiscal Year ending
                                                  Dec. 31, 2000                            Dec. 31, 1999
                                                ------------------                      ------------------

                                                                     Other Cash                          Other Cash
Name and Principal Position                     Salary              Compensation          Salary        Compensation
---------------------------                     ------              ------------          ------        ------------
Dr. Paul Averback                            CAN$137,500                                CAN$150,000
President and C.E.O.                          (US$91,697)                -              (US$103,925)         -

Mr. Roy Wolvin                                CAN$84,375                                 CAN$70,200
Secretary-Treasurer                           (US$56,269)                -               (US$48,640)         -

Mr. Jack Gemmell                             CAN$118,161                                CAN$120,000
General Counsel                               (US$78,801)                -               (US$83,143)         -

Dr. Judith Fitzpatrick
Vice President                                US$125,000              US$4,263                  N/A          -

Dr. Michael Munzar                           CAN$171,000                                CAN$174,000
Medical Director                             (US$114,038)                -              (US$120,557)         -

All directors and senior management          CAN$698,474                                CAN$514,200
as a group                                   (US$465,805)             US$4,263          (US$356,265)         -
Nymox does not have written employment contracts with any of the senior
management named above except with Dr. Judith Fitzpatrick.

Directors of Nymox, with the exception of the President, are paid a fee of
$1,000 for each board meeting attendance and are reimbursed for expenses
incurred in connection with their office.

The Company does not have any pension plans or other type of plans providing
retirement or similar benefits for senior management.

BOARD PRACTICES

Directors are elected at each annual meeting for a term of office until the next
annual meeting. Executive officers are appointed by the board of directors and
serve at the pleasure of the board. Other than Dr. Averback, no other officer or
director previously was affiliated with DMS Pharmaceuticals Inc.

There are no family relationships between any director or executive officer and
any other director or executive officer.

                                       33
34
Nymox does not have written contracts with any of the directors named above.
The Company does not have any pension plans or other type of plans providing
retirement or similar benefits for directors, nor any benefits upon termination
of service as a director.

Nymox's Audit Committee recommends to the Board of Directors the firm to be
appointed each year as independent auditors of the company's financial
statements and to perform services related to the completion of such audit and
the compensation to be paid to the firm. The Audit Committee also has
responsibility for:

     -    reviewing the scope and results of the audit with the independent
          auditors;

     -    reviewing with management and the independent auditors the company's
          interim and year-end financial condition and results of operations;

     -    considering the adequacy of the internal accounting, bookkeeping and
          control procedures of the company; and

     -    reviewing any non-audit services and special engagements to be
          performed by the independent auditors and considering the effect of
          such performance on the auditors' independence.

The Audit Committee also reviews at least once each year the terms of all
material transactions and arrangements between the company and its affiliates.
The Chairman of the Audit Committee is Hans Black, M.D. and the other members
are Michael Sonnenreich, Walter von Wartburg and Paul Averback, M.D. The
Chairman of the Board of Directors, Senator W. David Angus, Q.C., is also by
virtue of his office a member of the Audit Committee.

Nymox's Human Resources and Compensation Committee establishes and reviews
overall policy and structure with respect to compensation matters, including the
determination of compensation arrangements for directors, executive officers and
key employees of the company. The Committee is also responsible for the
administration and award of options to purchase shares pursuant to the company's
option and share purchase plans. The Chairman of the Human Resources and
Compensation Committee is Paul Averback, M.D. and the other member is Professor
Walter von Wartburg. The Chairman of the Board of Directors, Senator W. David
Angus, Q.C., is also by virtue of his office a member of this Committee.

EMPLOYEES
2000           1999          1998
Average Number of Employees by              -------        -------       -------
Sector and Geographic Location              US  CAN        US  CAN       US  CAN
------------------------------              --  ---        --  ---       --  ---
Research & Development                       9    8        10    6       12    4

Administration & Marketing                   2    3         9    4        8    4
                                            --   --        --   --       --   --
Total                                       11   11        19   10       20    8
                                            ==   ==        ==   ==       ==   ==
34
35

SHARE OWNERSHIP

As at March 31, 2001, the numbers of common shares owned and options granted to
directors and senior officers of the Corporation were as follows:
COMMON SHARES         OPTIONS          OPTIONS                                  EXPIRY DATE
NAME                                         OWNED              VESTED         NOT VESTED         EXERCISE PRICE            M/D/Y
----                                     -------------         -------         ----------         --------------         -----------
Paul Averback, M.D.                       12,646,895

W. David Angus, Q.C.                          25,000
                                                                60,000                                  $3.12             05/13/09
                                                                                                      (C$4.50)
                                                                10,000                                  $6.93             05/13/09
                                                                                                     (C$10.00)
                                                                                 30,000                 $6.93             05/13/09
                                                                                                     (C$10.00)

Hans Black, M.D.                              10,000            25,000                                  $3.12             05/13/09
                                                                                                      (C$4.50)
                                                                25,000                                  $3.875            05/01/10
                                                                                 50,000                 $6.93             05/01/10
                                                                                                     (C$10.00)
                                                                10,000                                  $4.70             06/15/10

Michael Sonnenreich                           30,000           100,000                                  $3.875            05/01/10

Walter Von Wartburg                           32,000           100,000                                  $3.875            05/01/10

Roy Wolvin                                     5,000            10,000                                  $2.25             01/17/06
                                                                                                      (C$3.25)
                                                                10,000                                  $9.53             01/17/06
                                                                                                     (C$13.75)
                                                                10,000                                  $6.79             01/17/06
                                                                                                      (C$9.80)
                                                                20,000                                  $6.93             01/17/06
                                                                                                     (C$10.00)
                                                                20,000                                  $3.12             05/13/09
                                                                                                      (C$4.50)

Michael Munzar                                31,325            50,000                                  $7.97             04/30/06
                                                                                                     (C$11.50)
                                                                 5,000                                  $6.24             10/31/07
                                                                                                      (C$9.00)
                                                                30,000                                  $6.93             10/31/07
                                                                                                     (C$10.00)
                                                                                 10,000                 $6.93             10/31/07
                                                                                                     (C$10.00)
                                                                20,000                                  $3.12             05/13/09
                                                                                                      (C$4.50)
                                                                50,000                                  $3.90             08/25/10

Jack Gemmell                                  10,000            50,000                                  $6.93             01/22/09
                                                                                                     (C$10.00)
                                                                25,000                                  $3.875            05/01/10

Judith Fitzpatrick                           187,951            10,000           30,000                 $3.70             01/08/10
35
36

LEGAL PROCEEDINGS

Amro International, S.A., a Panamanian company, has served Nymox Pharmaceutical
Corporation with a Statement of Claim filed with the Ontario Superior Court of
Justice (Court File No. 00-CV-201587), claiming to be entitled to the issuance
of 388,797 shares in accordance with repricing provisions contained in the
March, 2000 agreement between Amro and Nymox and to damages for lost opportunity
to sell these shares. Nymox believes that Amro's interpretation of the repricing
provisions in the March, 2000 agreement is incorrect. Nymox has filed a
statement of defense and intends to defend the action vigorously and to consider
its other options with respect to this matter.

ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS

MAJOR SHAREHOLDERS

The following table sets out as of March 31, 2001 the number of common shares
owned by Dr. Paul Averback, the President and CEO of Nymox and a member of the
Nymox board of directors, and by all directors and officers as a group. Dr.
Averback is the only person known to Nymox to own more than 5% of the common
shares.
Name of Shareholder                        Number of Common Shares     Percent of Class of
                                           owned by Shareholder        Common Shares
                                           -----------------------     -------------------
Dr. Paul Averback                                 12,646,895                   58.2%

All directors and officers as a group             12,978,171                   59.7%
In addition, as of March 31, 2001, Dr. Averback's wife owned 848,172 common
shares (3.9%) and 9022-1433 Canada Inc., a company owned by Dr. Averback and his
wife, owns 500,000 common shares (2.3%).

The above shareholders have the same voting rights as all other shareholders.
There has been no significant change in ownership for any of the persons listed
above over the past three years.

Nymox does not know of any other shareholder who beneficially owns more than 5%
of Nymox's shares.

According to information furnished to Nymox by the transfer agent for the common
shares, as of March 31, 2001, total shares outstanding were 21,739,317. There
were 909 holders of record of the common shares and 4,363 beneficial
shareholders in total. Of these, 123 were holders of record of the common shares
and 2,531 were beneficial shareholders with addresses in the United States and
such holders owned an aggregate of 3,256,666 shares, representing 15.1% of the
outstanding shares of common stock.

RELATED PARTY TRANSACTIONS

Not applicable

                                       36
37

ITEM 8. FINANCIAL INFORMATION

                      Consolidated Financial Statements of

                              NYMOX PHARMACEUTICAL
                                  CORPORATION

                  Years ended December 31, 2000, 1999 and 1998

                                       37
38

AUDITORS' REPORT TO THE SHAREHOLDERS

We have audited the consolidated balance sheets of Nymox Pharmaceutical
Corporation as at December 31, 2000 and 1999 and the consolidated statements of
earnings, deficit and cash flows for the years ended December 31, 2000, 1999 and
1998. These financial statements are the responsibility of the Corporation's
management. Our responsibility is to express an opinion on these financial
statements based on our audits.

With respect to the consolidated financial statements for the year ended
December 31, 2000, we conducted our audit in accordance with Canadian generally
accepted auditing standards and United States generally auditing standards. With
respect to the consolidated financial statements for each of the years in the
two-year period ended December 31, 1999, we conducted our audits in accordance
with Canadian generally accepted auditing standards. Those standards require
that we plan and perform an audit to obtain reasonable assurance whether the
financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation.

In our opinion, these consolidated financial statements present fairly, in all
material respects, the financial position of the Corporation as at December 31,
2000 and 1999 and the results of its operations and its cash flows for the years
ended December 31, 2000, 1999 and 1998 in accordance with Canadian generally
accepted accounting principles.

Canadian generally accepted accounting principles vary in certain significant
respects from accounting principles generally accepted in the United States.
Application of accounting principles generally accepted in the United States
would have affected results of operations for each of the years in the
three-year period ended December 31, 2000 and shareholders' equity as at
December 31, 2000, 1999 and 1998 to the extent summarized in note 10 to the
consolidated financial statements.

/s/ KPMG, LLP
Chartered Accountants

Montreal, Canada
February 22, 2001

                                       38
39

NYMOX PHARMACEUTICAL CORPORATION

Consolidated Financial Statements

Years ended December 31, 2000, 1999 and 1998
FINANCIAL STATEMENTS

     Consolidated Balance Sheets............................................  40

     Consolidated Statements of Earnings....................................  41

     Consolidated Statements of Deficit.....................................  42

     Consolidated Statements of Cash Flows..................................  43

     Notes to Consolidated Financial Statements.............................  44
39
40
NYMOX PHARMACEUTICAL CORPORATION
Consolidated Balance Sheets

December 31, 2000 and 1999
(in US dollars)
2000               1999
                                                 ------------       ------------
Assets
Current assets:
     Cash                                        $    565,711       $    449,363
     Accounts and other receivables                   101,517             43,001
     Research tax credits receivable                   10,457              3,180
     Notes receivable (note 3)                         -                 181,280
     Inventory                                          4,325             -
     Prepaid expenses                                  67,500            100,000
                                                 ------------       ------------
                                                      749,510            776,824
Capital assets (note 4)                             3,546,616          1,168,316
Deferred share issuance costs (note 6 (c))            222,512            195,351
                                                 ------------       ------------
                                                 $  4,518,638       $  2,140,491
                                                 ============       ============
Liabilities and Shareholders' Equity
Current liabilities:
     Accounts payable and accrued liabilities    $    323,774       $    486,916
     Note payable                                      -                 346,428
                                                 ------------       ------------
                                                      323,774            833,344
Non-controlling interest (note 5)                     933,922             -

Shareholders' equity:
     Share capital (note 6)                        23,243,941         16,912,963
     Deficit                                      (19,982,999)       (15,605,816)
                                                 ------------       ------------
                                                    3,260,942          1,307,147
Commitments and contingency (note 7)
Subsequent event (note 12)
                                                 ------------       ------------
                                                 $  4,518,638       $  2,140,491
                                                 ============       ============
See accompanying notes to consolidated financial statements.

On behalf of the Board:

/s/ Paul Averback, MD, Director

/s/ Hans Black, MD, Director

                                       40
41
NYMOX PHARMACEUTICAL CORPORATION
Consolidated Statements of Earnings

Years ended December 31, 2000, 1999 and 1998
(in US dollars)
2000             1999              1998
                                          -----------      -----------       -----------
Revenues:

     Sales                                $   157,688      $   153,252       $   104,804
     Interest                                  68,179           36,951           168,761
                                          -----------      -----------       -----------
                                              225,867          190,203           273,565

Expenses:
     Research and development               2,084,232        1,137,122         2,091,745
     Less research tax credits                (10,457)          (4,181)           (4,003)
                                          -----------      -----------       -----------
                                            2,073,775        1,132,941         2,087,742
     Marketing                                363,142          942,205         2,245,023
     General and administrative             1,335,500        1,229,894           550,269
     Cost of sales                             87,450          103,340            70,670
     Depreciation and amortization            375,810          136,947            93,917
     Interest and bank charges                 14,169            5,856             9,157
                                          -----------      -----------       -----------
                                            4,249,846        3,551,183         5,056,778
Gain on disposal of capital assets              -              (46,684)            -
                                          -----------      -----------       -----------
                                            4,249,846        3,504,449         5,056,778
                                          -----------      -----------       -----------
Net loss                                  $(4,023,979)     $(3,314,296)      $(4,783,213)
                                          ===========      ===========       ===========
Loss per share                            $     (0.19)     $     (0.17)      $     (0.25)
                                          ===========      ===========       ===========
Weighted average number of common shares   20,890,735       19,886,430        19,304,435
                                          ===========      ===========       ===========
See accompanying notes to consolidated financial statements

                                       41
42

NYMOX PHARMACEUTICAL CORPORATION
Consolidated Statements of Deficit

Years ended December 31, 2000, 1999 and 1998
(in US dollars)
2000            1999            1998
                                ------------    ------------    ------------
Deficit, beginning of year      $(15,605,816)   $(12,256,479)   $ (7,415,759)

Net loss                          (4,023,979)     (3,314,296)     (4,783,213)

Share issue costs                   (353,204)        (35,041)        (57,507)
                                ------------    ------------    ------------
Deficit, end of year            $(19,982,999)   $(15,605,816)   $(12,256,479)
                                ============    ============    ============
See accompanying notes to consolidated financial statements.

                                       42
43
NYMOX PHARMACEUTICAL CORPORATION
Consolidated Statements of Cash Flows

Years ended December 31, 2000, 1999 and 1998
(in US dollars)
2000              1999              1998
                                                         -----------       -----------       -----------
Cash flows from operating activities:
     Net loss                                           $(4,023,979)       $(3,314,296)      $(4,783,213)
     Adjustments for:
         Depreciation and amortization                      375,810            136,947            93,917
         Gain on disposal of capital assets                      -             (46,684)               -
         Foreign exchange                                        -             (13,453)           (4,858)
         Write-off of note receivable                       108,280                 -                 -
     Change in operating assets and liabilities:
         Accounts and other receivables                      16,730             36,316           (59,464)
         Interest receivable                                     -              31,928           (29,018)
         Receivable from a financial institution                 -             441,696          (441,696)
         Research tax credits receivable                     (7,277)               824             99,925
         Inventory                                           (4,325)                -                  -
         Prepaid expenses                                    56,000           (102,945)                -
         Accounts payable and accrued liabilities          (380,511)           188,872             93,129
                                                         -----------       -----------        -----------
                                                          (3,859,272)       (2,640,795)        (5,031,278)
Cash flows from financing activities:
     Proceeds from issuance of share capital               5,010,981           969,253          5,996,622
     Proceeds from notes payable                             201,993           346,428                 -
     Repayment of notes payable                             (548,421)               -                  -
     Share issue costs                                      (380,365)         (230,392)           (57,507)
                                                         -----------       -----------        -----------
                                                           4,284,188         1,085,289          5,939,115

Cash flows from investing activities:
     Additions to capital assets                            (381,568)         (164,783)          (390,125)
     Proceeds from disposal of capital assets                     -            185,896                 -
     Proceeds from collection of
       notes receivable                                       73,000                -            (151,040)
     Net proceeds on maturity of (purchases of)
       short-term investments                                     -          1,464,635           (231,290)
                                                         -----------       -----------        -----------
                                                            (308,568)        1,485,748           (772,455)

Effect of foreign exchange rate changes on cash                   -             24,215              8,066
                                                         -----------       -----------        -----------
Net increase (decrease) in cash                              116,348           (45,543)           143,448

Cash, beginning of year                                      449,363           494,906            351,458
                                                         -----------       -----------        -----------
Cash, end of year                                        $   565,711       $   449,363        $   494,906
                                                         ===========       ===========        ===========

Supplemental disclosure to statements of cash flows:
     (a) Interest paid                                   $    14,169        $    5,856        $     9,157
     (b) Non-cash transactions:
              Acquisition of Serex Inc. by issuance
                of common shares and other securities      1,319,997                -                  -
              Amortization of deferred share
                issue costs                                   20,220                -                  -

                                                         ===========       ===========        ===========
See accompanying notes to consolidated financial statements.

                                       43
44

NYMOX PHARMACEUTICAL CORPORATION
Notes to Consolidated Financial Statements

Years ended December 31, 2000, 1999 and 1998
(in US dollars)

1.   ORGANIZATION AND BUSINESS ACTIVITIES:

     Nymox Pharmaceutical Corporation (the "Corporation"), incorporated under
     the Canada Business Corporations Act, is a development stage
     biopharmaceutical corporation which specializes in the research and
     development of products for the diagnosis and treatment of Alzheimer's
     disease. The Corporation is currently marketing AlzheimAlert(TM), a urinary
     test that aids physicians in the diagnosis of Alzheimer's disease, and is
     developing treatments aimed at the causes of Alzheimer's disease. The
     Corporation also markets NicAlert(TM), a test that uses urine or saliva to
     detect use of tobacco products. The Corporation is developing a new class
     of antibacterial agents for the treatment of urinary tract and other
     bacterial infections in humans which have proved highly resistant to
     conventional antibiotic treatments and for the treatment of E-coli 0157:H7
     bacterial contamination in hamburger meat and other food and drink
     products. Under development at its subsidiary, Serex, Inc., are a potential
     saliva-based cholesterol test and a potential test for osteoporosis.

     Since inception, the Corporation's activities have been primarily focused
     on developing certain pharmaceutical technologies and obtaining outside
     funding to support the continued development of its technologies.
     Cumulative disclosure of selected financial information is presented in
     note 10 (c). The Corporation is subject to a number of risks, including the
     successful development and marketing of its technologies. In order to
     achieve its business plan and the realization of its assets and settlement
     of its liabilities in the normal course of operations, the Corporation
     anticipates the need to raise additional capital and/or achieve sales and
     other revenue generating activities. (See notes 6 (c) and 12).

     The Corporation is listed on the NASDAQ Stock Market.

2.   SIGNIFICANT ACCOUNTING POLICIES:

     (a)  Consolidation and change in measurement currency:

          The consolidated financial statements of the Corporation have been
          prepared under Canadian generally accepted accounting principles
          ("GAAP") and include the accounts of its US subsidiaries, Nymox
          Corporation and Serex Inc. Intercompany balances and transactions have
          been eliminated on consolidation.

          Consolidated financial statements prepared under US GAAP would differ
          in some respects from those prepared in Canada. A reconciliation of
          earnings and shareholders' equity reported in accordance with Canadian
          GAAP and with US GAAP is presented in note 10.

                                       44
45

NYMOX PHARMACEUTICAL CORPORATION
Notes to Consolidated Financial Statements, Continued

Years ended December 31, 2000, 1999 and 1998
(in US dollars)

2.   SIGNIFICANT ACCOUNTING POLICIES (CONTINUED):

     (a)  Consolidation and change in measurement currency (continued):

          Effective January 1, 2000, the Corporation adopted the United States
          dollar as its measurement currency as a result of the significance of
          business activities conducted in the United States and the increasing
          proportion of operating, financing and investing transactions in the
          Canadian operations that are denominated in U.S. dollars. In
          accordance with Canadian GAAP, the consolidated financial statements
          for the comparative figures as at and for the years ended December 31,
          1999 and 1998 have been presented in US dollars using the convenience
          translation method whereby all Canadian dollar amounts were converted
          into US dollars at the closing exchange rate at December 31, 1999,
          which was $1.4433 Canadian dollar per US dollar.

     (b)  Inventory:

          Inventory consists of finished goods and are carried at the lower of
          cost and net realizable value. The cost of finished goods is
          determined using the full cost accounting method.

     (c)  Capital assets:

          Capital assets are recorded at cost. Depreciation and amortization are
          provided using the following methods and annual rates:
Asset                                        Method             Rate
          -----                                        ------             ----
Computer equipment                         Straight-line          20%
         Laboratory equipment                       Straight-line          20%
         Office equipment and fixtures              Straight-line          20%
         Intellectual property rights               Straight-line          10%
The capitalized amount with respect to patents relates to direct costs
          incurred in connection with securing the patents. The cost of the
          patents does not necessarily reflect their present or future value and
          the amount ultimately recoverable is dependent upon the successful
          commercialization of the related products. Accordingly, patents are
          being amortized using the straight-line method commencing in the year
          of commercial production of the developed products. The capitalized
          amount is being amortized over the remaining years of the initial life
          of the patent of approximately 20 years.

          Management reviews the unamortized balance of intellectual property
          rights and patents on an annual basis and recognizes any impairment in
          carrying value when it is identified.

     (d)  Revenue recognition:

          Revenue from service fees is recognized when the service is performed.

                                       45
46
NYMOX PHARMACEUTICAL CORPORATION
Notes to Consolidated Financial Statements, Continued

Years ended December 31, 2000, 1999 and 1998
(in US dollars)

2. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED):

     (e)  Research and development expenditures:

          Research expenditures, net of research tax credits, are expensed as
          incurred. Development expenditures, net of tax credits, are expensed
          as incurred, except if they meet the criteria for deferral in
          accordance with generally accepted accounting principles.

     (f)  Foreign exchange:

          The Corporation's measurement currency is the United States dollar.
          Monetary assets and liabilities of the Canadian and foreign operations
          denominated in currencies other than the United States dollar are
          translated at the rates of exchange prevailing at the balance sheet
          dates. Other assets and liabilities denominated in currencies other
          than the United States dollar are translated at the exchange rates
          prevailing when the assets were acquired or the liabilities incurred.
          Revenues and expenses denominated in currencies other than the United
          States dollar are translated at the average exchange rate prevailing
          during the year, except for depreciation and amortization which are
          translated at the same rates as those used in the translation of the
          corresponding assets. Foreign exchange gains and losses resulting from
          the translation are included in the determination of net earnings.

     (g)  Stock-based compensation plan:

          No compensation expense is recognized under the Corporation's
          stock-based compensation plan when stock options are issued to
          employees. Any consideration paid by employees on exercise of stock
          options is credited to share capital.

     (h)  Income taxes:

          In 2000, the Corporation adopted the new recommendations of the
          Canadian Institute of Chartered Accountants ("CICA") with respect to
          accounting for income taxes. The CICA's new standard adopts the asset
          and liability method of accounting for income taxes. Under this
          method, future income tax assets and liabilities are determined based
          on "temporary differences" (differences between the accounting basis
          and the tax basis of the assets and liabilities), and are measured
          using the currently enacted, or substantively enacted, tax rates and
          laws expected to apply when these differences reverse. A valuation
          allowance is recorded against any future income tax asset if it is
          more likely than not that the asset will not be realized. Income tax
          expense or benefit is the sum of the Company's provision for current
          income taxes and the difference between the opening and ending
          balances of the future income tax assets and liabilities.

                                       46
47

NYMOX PHARMACEUTICAL CORPORATION
Notes to Consolidated Financial Statements, Continued

Years ended December 31, 2000, 1999 and 1998
(in US dollars)

2.   SIGNIFICANT ACCOUNTING POLICIES (CONTINUED):

     (h)  Income taxes (continued):

          Prior to adoption of this new accounting standard, income tax expense
          was determined using the deferral method. Under this method, deferred
          income tax expense was determined based on "timing differences"
          (differences between the accounting and tax treatment of items of
          expense or income), and were measured using the tax rates in effect in
          the year the differences originated. Certain deferred tax assets, such
          as the benefit of tax losses carried forward, were not recognized
          unless there was virtual certainty that they would be realized.

          The Company has adopted the new income tax accounting standard and has
          applied the provisions of the standard retroactively to January 1,
          1998. The adoption of the new standard did not affect current or
          previously reported earnings.

     (i)  Use of estimates:

          The preparation of financial statements in conformity with generally
          accepted accounting principles requires management to make estimates
          and assumptions that affect the reported amounts of assets and
          liabilities and disclosure of contingent assets and liabilities at the
          date of the financial statements and the reported amounts of revenues
          and expenses during the reporting periods. Actual results could differ
          from those estimates.

     (j)  Loss per share:

          The loss per share amounts have been calculated using the weighted
          average number of common shares outstanding during the year. Fully
          diluted loss per share has not been disclosed because the effect of
          common shares issuable upon the exercise of options and warrants would
          be anti-dilutive.

3.   NOTES RECEIVABLE:
2000                 1999
                                                                                       -----                -----
Note receivable, unsecured, non-interest bearing, payable on demand         $     -              $    38,800

     Note receivable, unsecured, bearing interest at 9% per annum beginning
       February 1, 1999, payable on demand, denominated in US dollars                  -                  142,480
                                                                                 -----------          -----------
                                                                                 $     -              $   181,280
                                                                                 ===========          ===========
47
48
NYMOX PHARMACEUTICAL CORPORATION
Notes to Consolidated Financial Statements, Continued

Years ended December 31, 2000, 1999 and 1998
(in US dollars)

3.   NOTES RECEIVABLE (CONTINUED):

     The notes were receivable from a former director and senior executive who
     is no longer associated with the Company. In 1999, Nymox Corporation, the
     Corporation's subsidiary, commenced an action against the former director
     for repayment of the two promissory notes and on August 5, 1999, the court
     granted Nymox Corporation's motion for summary judgment. During 2000, all
     actions were settled between the parties and the Corporation received
     approximately $73,000 as full settlement for the notes receivable. The
     difference of $108,280 was expensed in 2000.

4.   CAPITAL ASSETS:
2000
                                       ----------------------------------------

                                                     Accumulated       Net book
                                             Cost   depreciation          value
                                       ----------   ------------     ----------
Computer equipment                $   73,049       $ 33,611     $   39,438
     Laboratory equipment                 613,219        401,389        211,830
     Office equipment and fixtures         88,949         71,538         17,411
     Patents                            1,322,496        162,696      1,159,800
     Intellectual property rights       2,353,486        235,349      2,118,137
                                       ----------       --------     ----------
                                       $4,451,199       $904,583     $3,546,616
                                       ==========       ========     ==========
1999
                                       ----------------------------------------

                                                      Accumulated      Net book
                                             Cost    depreciation         value
                                       ----------    ------------    ----------
Computer equipment                $   57,713       $ 25,203     $   32,510
     Laboratory equipment                 258,145        104,053        154,092
     Office equipment and fixtures         26,527         11,750         14,777
     Patents                            1,042,427         75,491        966,936
     Intellectual property rights               1           -                 1
                                       ----------       --------     ----------
                                       $1,384,813       $216,497     $1,168,316
                                       ==========       ========     ==========
48
49

NYMOX PHARMACEUTICAL CORPORATION
Notes to Consolidated Financial Statements, Continued

Years ended December 31, 2000, 1999 and 1998
(in US dollars)

5.   BUSINESS ACQUISITION:

     The Corporation entered into a share purchase agreement to acquire a
     controlling interest in Serex, Inc. ("Serex"), a privately-held development
     stage corporation based in New Jersey. When the agreement closed on March
     2, 2000, the Corporation acquired 72.3% of the issued and outstanding
     common stock of Serex in exchange for 187,951 common shares of the
     Corporation having a value of approximately $657,825, and a warrant to
     purchase 115,662 of the Corporation's common shares at a price of $3.70 per
     share exercisable on the following dates: (i) January 8, 2001 - 35,783
     shares (ii) January 8, 2002 - 30,000 shares (iii) January 8, 2003 - 30,000
     shares, (iv) January 8, 2004 - 19,879 shares. In connection with this
     acquisition, the Corporation also issued 40,000 options to the selling
     shareholder to purchase the Corporation's shares. The options are
     exercisable at a price of $3.70/share over a four-year period.

     On August 1, 2000, the Corporation acquired an additional 293,138 shares of
     Serex for a consideration consisting of 54,646 common shares of the
     Corporation having a value of $191,261 and warrants to purchase 33,627 of
     the Corporation's common shares at a price of $3.70 per share. On October
     25, 2000, the Corporation acquired an additional 75,520 shares of Serex for
     a consideration of 14,078 common shares of the Corporation having a value
     of $49,273 and warrants to purchase 8,663 of the Corporation's common
     shares at a price of $3.70 per share. After the above transactions, the
     Corporation had approximately 97% of the outstanding shares of Serex.

     Details of the acquisition are as follows:
Assets acquired:
         Current assets                                            $     98,746
         Capital assets                                                  19,056
         Current liabilities                                           (217,369)
         Non-controlling interest (i)                                  (933,922)
                                                                    -----------
                                                                     (1,033,489)

     Patents, technological platform and know-how acquired
       ("Intellectual property rights")                               2,353,486
                                                                    -----------
     Value of assets acquired                                       $ 1,319,997
                                                                    ===========

     Consideration:
         Common shares                                              $   898,359
         Warrants and options (ii)                                      421,638
                                                                    -----------
                                                                    $ 1,319,997
                                                                    ===========
49
50

NYMOX PHARMACEUTICAL CORPORATION
Notes to Consolidated Financial Statements, Continued

Years ended December 31, 2000, 1999 and 1998
(in US dollars)

5.   BUSINESS ACQUISITION (CONTINUED):

     (i)  Non-controlling interest includes redeemable, convertible preferred
          shares of Serex held by third parties in the amount of $800,000. Up to
          50% of preferred shares are redeemable at any time at the option of
          the preferred shareholders for their issue price. The preferred shares
          are convertible into common shares of Serex at a price of $3.946 per
          share.

     (ii) The Corporation determined that the warrants and options issued in
          connection with the acquisition of Serex had a value of $421,638,
          which was determined using the methodology described in
          note 10 (d)(2).

6.   SHARE CAPITAL:
2000              1999
                                                                           -----------      -----------
Authorized:
         An unlimited number of common shares

     Issued and outstanding:
         21,377,621 common shares (1999 - 20,003,804)                      $22,822,303       $16,912,963
         Warrants and options (see note 5 (ii))                                421,638                 -
                                                                           -----------       -----------
                                                                           $23,243,941       $16,912,963
                                                                           ===========       ===========
(a)  Changes in the Corporation's outstanding common shares are presented
          below:
Shares            Dollars
                                                                           -----------      ------------
Issued and outstanding, December 31, 1998                              19,727,904       $15,943,710

     Issue of common shares for cash (b)                                       177,000           746,553

     Issue of common shares pursuant to exercise
       of stock options (e)                                                     98,900           222,700
                                                                            ----------       -----------
     Balance, December 31, 1999                                             20,003,804        16,912,963

     Issue of common shares for cash (b) (c)                                 1,112,142         5,000,000

     Issue of common shares in connection
       with Serex acquisition                                                  256,675           898,359

     Issue of common shares pursuant to exercise
       of stock options (e)                                                      5,000            10,981
                                                                            ----------       -----------
     Balance, December 31, 2000                                             21,377,621       $22,822,303
                                                                            ==========       ===========
50
51
NYMOX PHARMACEUTICAL CORPORATION
Notes to Consolidated Financial Statements, Continued

Years ended December 31, 2000, 1999 and 1998
(in US dollars)

6.   SHARE CAPITAL (CONTINUED):

     (b)  Private placements:

          In 2000, the Corporation completed a private placement for 821,637
          common shares for received aggregate proceeds of $4,000,000. In 1999,
          the Corporation completed private placements for 177,000 common shares
          for total aggregate proceeds of $746,553. The share issue costs
          related to these private placements have been charged against the
          deficit. See note 7 (c).

     (c)  Common Stock Purchase Agreement:

          In November 1999, the Corporation and Jaspas Investments Limited
          ("Jaspas"), a corporation based in the British Virgin Islands, signed
          a common stock purchase agreement (the "Agreement") that establishes
          the terms and conditions for the future issuance and purchase of the
          Corporation's common shares by Jaspas. In general terms, Jaspas is
          committed to purchase up to $12 million of the Corporation's common
          shares over a thirty-month period. However, Jaspas may not purchase
          more than 19.9% of the Corporation's common shares issued and
          outstanding as of November 12, 1999, the closing date under the
          Agreement, without obtaining shareholder approval.

          The Agreement establishes what is referred to by the parties as an
          equity drawdown facility. On a monthly basis, the Corporation may
          request a drawdown on the facility subject to a formula, based on the
          average stock price and average trading volume, that sets the maximum
          amount for any given draw. At the end of a 22-day trading period
          following the drawdown request, the amount of money that Jaspas will
          provide to the Corporation and the number of shares that the
          Corporation will issue is settled based on the formula using the
          average daily share price for each of the 22 trading days. Jaspas
          receives a 6% discount on the market price determined for the 22-day
          trading period, and the Corporation will receive the settled amount
          less a 3% placement fee payable to the placement agents.

          The Corporation may make up to 24 drawdowns to a maximum of
          $750,000/drawdown and $12,000,000 in total. There are certain
          conditions that must be satisfied before Jaspas is obligated to
          purchase the Corporation's common shares. In 2000, the Corporation
          issued 290,505 common shares and raised $1,000,000 under this
          facility. In 1999, no drawdown was made by the Corporation.

          The Corporation has also issued a warrant to Jaspas to purchase
          200,000 common shares (see note 6 (d)).

          The gross fees related to this transaction amounted to $242,732 and
          have been accounted for as deferred share issuance costs and are being
          amortized over the thirty-month drawdown period. Amortization is
          calculated for each drawdown based on the percentage of the actual
          drawdown over the total facility. In 2000, the Corporation amortized
          $20,220 of deferred share issuance costs to the deficit.

                                       51
52
NYMOX PHARMACEUTICAL CORPORATION
Notes to Consolidated Financial Statements, Continued

Years ended December 31, 2000, 1999 and 1998
(in US dollars)

6.   SHARE CAPITAL (CONTINUED):

     (d)  Warrants:

          The Corporation has issued the following warrants to purchase common
          shares:
Exercise                                          Outstanding at
                        price per                   Exercised                December 31,
          Warrants          share      Issued         to date    Expired             2000               Expiry
          --------     ----------     -------       ---------    -------   --------------              -------
Series E         $ 4.53    200,000 (i)         -          -             200,000    November 30, 2004
          Series F         $ 4.06    160,000 (ii)        -          -             160,000    November 30, 2004
          Series G         $ 3.70    115,662 (iii)       -          -             115,662      January 8, 2005
          Series H         $ 9.38     66,667 (iv)        -          -              66,667        March 6, 2004
          Series I         $ 7.81     26,667 (iv)        -          -              26,667        March 6, 2004
          Series J         $ 3.70     42,290 (iii)       -          -              42,290        July 31, 2005
(i)   Warrant issued to Jaspas in connection with the common stock
                purchase agreement referred to in note 6 (c). The warrant
                entitles Jaspas to purchase 100,000 common shares at an exercise
                price of US$4.5315. Jaspas may purchase a further 100,000 common
                shares at the same price only if the Corporation has not drawn
                down at least US$7,000,000 within eighteen months from the
                effective date of the agreement.

          (ii)  Warrants issued to placement agents in connection with the
                common stock purchase agreement. The warrants are exercisable at
                a price of US$4.0625.

          (iii) Warrants issued in connection with the Serex acquisition (see
                note 5).

          (iv)  Warrants issued in connection with 2000 private placement (see
                note 6 (b)).

     (e)  Stock options:

          The Corporation has established a stock option plan (the "Plan") for
          its key employees, its officers and directors, and certain
          consultants. The Plan is administered by the Board of Directors of the
          Corporation. The Board may from time to time designate individuals to
          whom options to purchase common shares of the Corporation may be
          granted, the number of shares to be optioned to each, and the option
          price per share. The option price per share cannot involve a discount
          to the market price at the time the option is granted. The total
          number of shares to be optioned to any one individual cannot exceed 5%
          of the total issued and outstanding shares and the maximum number of
          shares which may be optioned under the Plan cannot exceed 2,500,000
          common shares without shareholder approval.

                                       52
53

NYMOX PHARMACEUTICAL CORPORATION
Notes to Consolidated Financial Statements, Continued

Years ended December 31, 2000, 1999 and 1998
(in US dollars)

6.   SHARE CAPITAL (CONTINUED):

     (e)  Stock options (continued):

          Changes in outstanding options were as follows for the last two fiscal
periods:
Weighted
                                                                                                      average
                                                                                                     exercise
                                                                                   Number               price
                                                                              -----------         -----------
Balance, December 31, 1998                                             1,926,000         $      3.97

         Granted                                                                  351,500                3.72

         Exercised                                                                (98,900)               2.25

         Expired                                                                  (55,000)               6.63

         Cancelled                                                               (993,100)               2.30
                                                                              -----------         -----------
         Balance, December 31, 1999                                             1,130,500                4.76

         Granted                                                                  549,000                4.06

         Exercised                                                                 (5,000)               2.20

         Expired                                                                  (10,000)               4.26

         Cancelled                                                                (25,000)               3.12
                                                                              -----------         -----------
         Balance, December 31, 2000                                             1,639,500         $      4.54
                                                                              ===========         ===========
53
54

NYMOX PHARMACEUTICAL CORPORATION
Notes to Consolidated Financial Statements, Continued

Years ended December 31, 2000, 1999 and 1998

6.   SHARE CAPITAL (CONTINUED):

     (e) Stock options (continued):

         At December 31, 2000, options outstanding and exercisable were as
follows:
Options outstanding   Options exercisable     Exercise price per share       Expiry date
         -------------------   -------------------     ------------------------       -----------
285,000               275,000                   $2.25                January 17, 2006
                20,000                20,000                   $9.53                January 17, 2006
                20,000                20,000                   $6.79                January 17, 2006
                40,000                40,000                   $6.93                January 17, 2006
               100,000               100,000                   $7.97                  April 30, 2006
                10,000                10,000                   11.60                 August 13, 2006
                50,000                10,000                   $6.24                 August 13, 2006
                30,000                30,000                   $6.93                 August 13, 2006
                25,000                25,000                   $6.24                October 31, 2007
                90,000                90,000                   $6.93                October 31, 2007
                 9,000                 9,000                   $6.41               December 19, 2007
               100,000               100,000                   $4.85                November 9, 2008
                50,000                50,000                   $6.93                January 22, 2009
               175,000               145,000                   $3.12                    May 13, 2009
                10,000                10,000                   $6.93                    May 13, 2009
                 3,500                 1,167                   $6.41                    May 13, 2009
                75,000                75,000                   $3.12                    June 1, 2009
                40,000                  -                      $3.70                 January 8, 2009
               308,500               268,500                   $3.87                     May 1, 2010
                50,000                  -                      $6.93                     May 1, 2010
                10,000                10,000                   $4.70                   June 15, 2010
                10,000                10,000                   $3.50                   July 13, 2010
                 2,000                 2,000                   $4.00                   July 13, 2010
                71,500                31,500                   $3.20                 August 14, 2010
                 5,000                  -                      $3.15                 August 16, 2010
                50,000                50,000                   $3.90                 August 25, 2010
             ---------             ---------
             1,639,500             1,382,167
             ---------             ---------
54
55

NYMOX PHARMACEUTICAL CORPORATION
Notes to Consolidated Financial Statements, Continued

Years ended December 31, 2000, 1999 and 1998
(in US dollars)

7.   COMMITMENTS AND CONTINGENCY:

     (a)  Operating leases:

          Minimum lease payments under operating leases for the Corporation's
          premises for the next five years are as follows:
2001                                                         $152,031
          2002                                                          134,394
          2003                                                          104,382
          2004                                                           93,740
          2005                                                           15,623
                                                                       --------
                                                                       $500,170
                                                                       ========
(b)  Research funding agreement:

          The Corporation is committed to make research grants to an unrelated
          medical facility in the U.S. in the aggregate amount of approximately
          $215,000 in the next two years as follows:
2001                                                         $172,000
         2002                                                           43,000
                                                                      --------
                                                                      $215,000
                                                                      ========
Under this agreement, the medical facility benefits from research
          funding and collaboration from the Corporation and is entitled to
          royalties based on a percentage of sales of any commercialized product
          derived from this research.

     (c)  Contingency:

          A shareholder has served the Corporation with a Statement of Claim
          filed with the Ontario Superior Court of Justice claiming to be
          entitled to the issuance of 388,797 additional shares in accordance
          with repricing provisions contained in the March 2000 private
          placement agreement referred to in note 6 (b) and to damages for lost
          opportunity to sell these shares. The Corporation believes that the
          shareholder's interpretation of the repricing provisions in the March
          2000 agreement is incorrect and intends to defend the action
          vigorously.
                                       55
56
NYMOX PHARMACEUTICAL CORPORATION
Notes to Consolidated Financial Statements, Continued

Years ended December 31, 2000, 1999 and 1998
(in US dollars)

8.   INCOME TAXES:

     Details of the components of income taxes are as follows:
2000                 1999                 1998
                                                                ----                 ----                 ----
Loss before income taxes:

          Canadian operations                            $(2,558,476)         $(2,631,662)         $(1,782,794)
          U.S. operations                                 (1,465,503)            (682,634)          (3,000,419)
                                                         -----------          -----------          -----------
                                                          (4,023,979)          (3,314,296)          (4,783,213)
     Basic income tax rate                                     38.0%                38.0%                38.0%
                                                         -----------          -----------          -----------
     Income tax recovery at statutory rates                1,529,000            1,260,000            1,817,000

     Adjustments in income taxes resulting from:
          Non-recognition of losses and other
            unclaimed deductions                          (1,529,000)          (1,260,000)          (1,817,000)
                                                         -----------          -----------          -----------
     Income taxes                                        $     -              $    -               $    -
                                                         ===========          ===========          ===========
The income tax effect of temporary differences that give rise to the net
     future tax asset is presented below:
2000                 1999
                                                                                     ----                 ----
Non-capital losses                                                       $ 6,695,000          $ 4,918,000

     Scientific research and experimental development
       expenditures                                                               644,000              662,000

     Investment tax credits                                                       350,000              330,000

     Intellectual property rights                                                (805,000)                -

     Less valuation allowance                                                  (6,884,000)          (5,910,000)
                                                                              -----------          -----------
     Net future tax asset                                                     $     -              $      -
                                                                              ===========          ===========
56
57

NYMOX PHARMACEUTICAL CORPORATION
Notes to Consolidated Financial Statements, Continued

Years ended December 31, 2000, 1999 and 1998
(in US dollars)

8.   INCOME TAXES (CONTINUED):

     In assessing the realizability of future tax assets, management considers
     whether it is more likely than not that some portion or all of the future
     tax assets will not be realized. The ultimate realization of future tax
     assets is dependent upon the generation of future taxable income and tax
     planning strategies. Since the Corporation is a development stage
     enterprise, the generation of future taxable income is dependent on the
     successful commercialization of its products and technologies.

     The Corporation has non-capital losses carried forward and accumulated
     scientific research and development expenditures which are available to
     reduce future years' taxable income. The related income tax benefit of
     these items will be recorded in earnings when realized. These expire as
     follows:
Federal          Provincial
                                                   ----------         ----------
Non-capital losses:
          2001                                     $   40,000         $   40,000
          2002                                        637,000                 -
          2003                                      1,379,000            884,000
          2004                                        962,000            755,000
          2005                                      2,095,000          2,096,000
          2006                                      2,435,000          2,435,000
          2007                                      2,417,000          2,417,000

     Scientific research and development
       expenditures: (Indefinitely)                 1,312,000          2,943,000
The Corporation also has investment tax credits available in the amount of
     approximately $350,000 to reduce future years' federal taxes payable. The
     benefit of these credits will be recorded when realized. These credits
     expire as follows:
2005                                                            $   25,000
      2006                                                               184,000
      2007                                                                98,000
      2008                                                                 3,000
      2009                                                                 8,000
      2010                                                                32,000
57
58

NYMOX PHARMACEUTICAL CORPORATION
Notes to Consolidated Financial Statements, Continued

Years ended December 31, 2000, 1999 and 1998
(in US dollars)

8.   INCOME TAXES (CONTINUED):

     In addition, the Corporation's US subsidiaries have losses carried forward
     of approximately $6,840,000 which expire as follows:
2011                         $  460,000
     2012                          1,730,000
     2018                          2,700,000
     2019                            950,000
     2020                          1,000,000
9.   FINANCIAL INSTRUMENTS:

     (a)  Foreign currency risk management:

          As indicated in note 2 (a), the Corporation has adopted the US dollar
          as its measurement currency effective January 1, 2000 because a
          substantial portion of revenues, expenses, assets and liabilities of
          its Canadian and US operations are denominated in US dollars. The
          Canadian operation also has transactions denominated in Canadian
          dollars, principally relating to salaries and rent. The Corporation
          does not engage in the use of derivative financial instruments to
          manage its currency exposures. Fluctuations in payments made for the
          payment of the Corporation's expenses denominated in currencies other
          than the US dollar could cause unanticipated fluctuations in the
          Corporation's operating results.

     (b)  Fair value disclosure:

          The Corporation has determined that the carrying value of its
          short-term financial assets and liabilities approximates fair value
          due to the immediate or short-term maturity of these financial
          instruments.

                                       58
59

NYMOX PHARMACEUTICAL CORPORATION
Notes to Consolidated Financial Statements, Continued

Years ended December 31, 2000, 1999 and 1998
(in US dollars)

10.  CANADIAN/U.S. REPORTING DIFFERENCES:

     (a)  Consolidated statements of earnings:

          The reconciliation of earnings reported in accordance with Canadian
          GAAP and with U.S. GAAP is as follows:
2000            1999            1998
                                                             -----------     -----------     -----------
Net loss, Canadian GAAP                            $(4,023,979)    $(3,314,296)    $(4,783,213)

          Adjustments:
               Amortization of patents (i)                         9,361           9,142         (50,622)
               Stock-based compensation - options
                 granted to non-employees (ii)                  (257,690)       (198,815)       (274,088)
               Change in reporting currency (iii)                     -           94,803         128,361
                                                             -----------     -----------     -----------
          Net loss, U.S. GAAP                                $(4,272,308)    $(3,409,166)    $(4,979,562)
                                                             ===========     ===========     ===========
          Loss per share, U.S. GAAP                          $     (0.20)    $     (0.17)    $     (0.26)
                                                             ===========     ===========     ===========
(b)  Consolidated shareholders' equity:

          The reconciliation of shareholders' equity reported in accordance with
          Canadian GAAP and with U.S. GAAP is as follows:
2000            1999            1998
                                                             -----------     -----------     -----------
Shareholders' equity, Canadian GAAP              $   3,260,942     $ 1,307,147     $ 3,687,231

          Adjustments:
               Amortization of patents (i)                      (147,946)       (157,307)       (176,549)
               Stock-based compensation - options
                 granted to non-employees (ii):
                   Cumulative compensation expense            (1,205,543)       (947,853)       (792,788)
                   Additional paid-in capital                  1,258,106       1,000,416         749,038
               Change in reporting currency (iii)                (62,672)        (62,672)       (162,580)
                                                             -----------     -----------     -----------
                                                                (158,055)       (167,416)       (382,879)
                                                             -----------     -----------     -----------
          Shareholders' equity, U.S. GAAP                    $ 3,102,887     $ 1,139,731     $ 3,304,352
                                                             ===========     ===========     ===========
59
60

NYMOX PHARMACEUTICAL CORPORATION
Notes to Consolidated Financial Statements, Continued

Years ended December 31, 2000, 1999 and 1998
(in US dollars)

10.  CANADIAN/U.S. REPORTING DIFFERENCES (CONTINUED):

     (b)  Consolidated shareholders' equity:

         (i)   In accordance with APB Opinion 17, Intangible Assets, the patents
               are amortized using the straight-line method over the legal life
               of the patents from the date the patent was secured. For Canadian
               GAAP purposes, patents are amortized commencing in the year of
               commercial production of the developed products.

         (ii)  In accordance with FAS 123, Accounting for Stock-Based
               Compensation, compensation related to the stock options granted
               to non-employees has been recorded in the accounts based on the
               fair value of the stock options at the grant date. The fair value
               of the stock options was estimated as described in note 10 (d)
               (2). There are no comparable Canadian standards.

         (iii) Change in reporting currency:

               As explained in note 2 (a), the Company has adopted the US dollar
               as its reporting currency effective January 1, 2000. For Canadian
               GAAP purposes, the financial information for 1999 and 1998 has
               been translated into US dollars at the December 31, 1999 exchange
               rate. For United States GAAP reporting purposes, assets and
               liabilities for all years presented have been translated into US
               dollars at the ending exchange rate for the respective year and
               the statement of earnings at the average exchange rate for the
               respective year.

     (c)  Consolidated comprehensive income:
2000             1999             1998
                                                           ----------      -----------      -----------
Net loss, US GAAP                               $(4,272,308)     $(3,409,166)     $(4,979,562)

          Other comprehensive income (loss):
               Foreign currency translation
                 adjustment                                        -           111,518           (8,733)
                                                          -----------      -----------      -----------
          Comprehensive loss                              $(4,272,308)     $(3,297,648)     $(4,988,295)
                                                          ===========      ===========      ===========
FAS 130, Reporting Comprehensive Income, requires the Corporation to
          report and display certain information related to comprehensive income
          for the Corporation. Comprehensive income includes net earnings and
          certain foreign currency translation adjustments.

          The accumulated comprehensive loss only comprises foreign currency
          translation adjustments and is included in the amount of shareholders'
          equity presented for US GAAP purposes in note 10 (b).

                                       60
61

NYMOX PHARMACEUTICAL CORPORATION
Notes to Consolidated Financial Statements, Continued

Years ended December 31, 2000, 1999 and 1998
(in US dollars)

10.  CANADIAN/U.S. REPORTING DIFFERENCES (CONTINUED):

     (d) Other disclosures required by United States GAAP:

         (1)   Development stage company:

               The Corporation is in the process of developing unique patented
               products which are subject to approval by the regulatory
               authorities. It has had limited revenues to date on the sale of
               its products under development. Accordingly, the Corporation is a
               development stage company as defined in Statement of Financial
               Accounting Standards No. 7 and the following additional
               disclosures are provided:
Cumulative           Cumulative
                                                                        since the date of    since the date of
                                                                             inception of         inception of
                                                                          the Corporation      the Corporation
                                                                          to December 31,      to December 31,
                                                                                     2000                 1999
                                                                        -----------------     ----------------
Interest revenue                                               $    484,150         $    415,971

              Service fees                                                        432,776              275,088

              Gross research and development expenditures                       8,936,120            7,460,818

              Other expenses                                                   12,054,382            9,269,381

              Cash inflows (outflows):
                  Operating activities                                        (18,918,110)         (15,058,838)
                  Investing activities                                           (513,063)            (204,495)
                  Financing activities                                         21,437,303           17,153,115
                                                                             ============         ============
61
62
NYMOX PHARMACEUTICAL CORPORATION
Notes to Consolidated Financial Statements, Continued

Years ended December 31, 2000, 1999 and 1998
(in US dollars)

10.  CANADIAN/U.S. REPORTING DIFFERENCES (CONTINUED):

     (d)  Other disclosures required by United States GAAP (continued):

          (1)  Development stage company (continued):

               The statement of shareholders' equity since date of inception is
               presented below.
Additional
                                                      Number of        Consi-      paid-in    Accumulated
                                                         shares      deration      capital        deficit           Total
                                                      ---------     ----------    ---------    -----------     -----------
Year ended July 31, 1990:

                  Common shares issued                2,500,000     $  172,414   $   -        $     -         $   172,414
                  Net loss                                 -              -          -           (109,241)       (109,241)
                                                      ---------     ----------   ---------    -----------     -----------
                  Balance, July 31, 1990              2,500,000        172,414       -           (109,241)         63,173

               Year ended July 31, 1991:
                  Net loss                                 -              -          -            (21,588)        (21,588)
                  Cumulative translation adjustment        -             1,499       -               (950)            549
                                                      ---------     ----------   ---------    -----------     -----------
                  Balance, July 31, 1991              2,500,000        173,913       -           (131,779)         42,134

               Year ended July 31, 1992:
                  Common shares issued                    9,375         31,468       -               -             31,468
                  Net loss                                 -              -          -            (45,555)        (45,555)
                  Cumulative translation adjustment        -            (6,086)      -              5,598            (488)
                                                      ---------     ----------   ---------    -----------     -----------
                  Balance, July 31, 1992              2,509,375        199,295       -           (171,736)         27,559

               Year ended July 31, 1993:
                  Common shares issued                  201,250        159,944       -               -            159,944
                  Common shares cancelled              (500,000)         -           -               -               -
                  Net loss                                -              -           -            (38,894)        (38,894)
                  Cumulative translation adjustment       -            (13,994)      -             12,830          (1,164)
                                                      ---------     ----------   ---------    -----------     -----------
                  Balance, July 31, 1993              2,210,625        345,245       -           (197,800)        147,445

               Year ended July 31, 1994:
                  Common shares issued                    2,500          7,233       -               -              7,233
                  Net loss                                -              -           -            (53,225)        (53,225)
                  Cumulative translation adjustment       -            (25,173)      -             15,808          (9,365)
                                                      ---------     ----------   ---------    -----------     -----------
                  Balance, July 31, 1994              2,213,125        327,305       -           (235,217)         92,088

               Year ended July 31, 1995:
                  Common shares issued                   78,078        303,380       -               -            303,380
                  Net loss                                -              -           -           (285,910)       (285,910)
                  Cumulative translation adjustment       -              5,196       -             (7,221)         (2,025)
                                                      ---------     ----------   ---------    -----------     -----------
                  Balance, July 31, 1995              2,291,203        635,881       -           (528,348)        107,533

               Period ended December 31, 1995:
                  Adjustment necessary to
                    increase the number of
                    common shares                    12,708,797          -           -               -              -
                                                      ---------     ----------   ---------    -----------     -----------
                  Adjusted number of
                    common shares                    15,000,000        635,881       -           (528,348)        107,533
                  Common shares issued                2,047,082      2,997,284       -               -          2,997,284
                  Net loss                                -              -           -         (1,194,226)     (1,194,226)
                  Share issue costs                       -           (153,810)      -               -           (153,810)
                  Cumulative translation adjustment       -              2,858       -             (6,328)         (3,470)
                                                      ---------     ----------   ---------    -----------     -----------
                  Balance, December 31, 1995
                    carried forward                  17,047,082      3,482,213       -         (1,728,902)      1,753,311
62
63
NYMOX PHARMACEUTICAL CORPORATION
Notes to Consolidated Financial Statements, Continued

Years ended December 31, 2000, 1999 and 1998
(in US dollars)

10.  CANADIAN/U.S. REPORTING DIFFERENCES (CONTINUED):

     (d) Other disclosures required by United States GAAP (continued):

         (1)  Development stage company (continued):

              The statement of shareholders' equity since date of inception is
              presented below (continued).
Additional
                                                      Number of        Consi-         paid-in      Accumulated
                                                         shares      deration         capital          deficit         Total
                                                      ---------      --------     -----------      -----------         -----
Balance, December 31, 1995
                brought forward                      17,047,082     $3,482,213    $     -          $(1,728,902)     $ 1,753,311

              Year ended December 31, 1996:
                  Common shares issued                  882,300      3,852,364          -                -            3,852,364
                  Net loss                                -              -              -           (3,175,587)      (3,175,587)
                  Share issue costs                       -           (170,699)         -                -             (170,699)
                  Stock-based compensation                -              -            434,145            -              434,145
                  Cumulative translation adjustment       -            (16,769)        (2,217)          24,544            5,558
                                                     ----------    -----------     ----------      -----------      -----------
              Balance, December 31, 1996             17,929,382      7,147,109        431,928       (4,879,945)       2,699,092

              Year ended December 31, 1997:
                  Common shares issued                  703,491      3,180,666          -                -            3,180,666
                  Net loss                                -              -              -           (3,755,409)      (3,755,409)
                  Share issue costs                       -           (161,482)         -                -             (161,482)
                  Capital stock subscription              -            352,324          -                -              352,324
                  Stock-based compensation                -              -            108,350            -              108,350
                  Cumulative translation adjustment       -           (299,275)       (21,578)         325,364            4,511
                                                     ----------    -----------     ----------      -----------      -----------
                  Balance, December 31, 1997         18,632,873     10,219,342        518,700       (8,309,990)       2,428,052

              Year ended December 31, 1998:
                  Common shares issued                1,095,031      5,644,638          -                -            5,644,638
                  Net loss                                -              -              -           (4,979,562)      (4,979,562)
                  Share issue costs                       -            (54,131)         -                -              (54,131)
                  Stock-based compensation                -              -            274,088            -              274,088
                  Cumulative translation adjustment       -           (685,156)       (43,750)         720,173           (8,733)
                                                     ----------    -----------     ----------      -----------      -----------
              Balance, December 31, 1998             19,727,904     15,124,693        749,038      (12,569,379)       3,304,352

              Year ended December 31, 1999:
                  Common shares issued                  275,900        969,253          -               -               969,253
                  Net loss                                -              -              -           (3,409,166)      (3,409,166)
                  Share issue costs                       -            (35,041)         -               -               (35,041)
                  Stock-based compensation                -              -            198,815           -               198,815
                  Cumulative translation adjustment       -            943,133         52,563         (884,178)         111,518
                                                     ----------    -----------     ----------      -----------      -----------
              Balance, December 31, 1999             20,003,804     17,002,038      1,000,416      (16,862,723)       1,139,731

              Year ended December 31, 2000:
                  Common shares issued                1,373,817      5,909,340          -              -              5,909,340
                  Warrants and options                    -            421,638          -              -                421,638
                  Net loss                                -              -              -           (4,272,308)      (4,272,308)
                  Share issue costs                       -           (353,204)         -              -               (353,204)
                  Stock-based compensation                -              -            257,690          -                257,690
                                                     ----------    -----------     ----------     ------------      -----------
              Balance, December 31, 2000             21,377,621    $22,979,812     $1,258,106     $(21,135,031)     $ 3,102,887
                                                     ==========    ===========     ==========     ============      ===========
63
64
NYMOX PHARMACEUTICAL CORPORATION
Notes to Consolidated Financial Statements, Continued

Years ended December 31, 2000, 1999 and 1998
(in US dollars)

10.  CANADIAN/U.S. REPORTING DIFFERENCES (CONTINUED):

     (d)  Other disclosures required by United States GAAP (continued):

          (2)  Stock-based compensation:

               For US GAAP purposes, the Corporation applies APB Opinion 25,
               Accounting for Stock Issued to Employees, in accounting for its
               stock option plan, and accordingly, no compensation cost has been
               recognized for stock options granted to employees in these
               financial statements. As explained in note 10 (b), compensation
               cost has been recognized for stock options granted to
               non-employees. Had compensation cost been determined for stock
               options granted to employees based on the fair value at the grant
               dates for awards under the plan consistent with the method of
               FASB Statement 123, Accounting for Stock-Based Compensation, the
               Corporation's net earnings and loss per share would have been
               adjusted to the pro-forma amounts indicated below for US GAAP:
2000             1999
                                                                                 -----------      -----------
Net loss                     As reported       (US GAAP)          $(4,272,308)     $(3,409,166)
                                            Pro-forma                             (5,884,919)      (3,990,187)

               Loss per share               As reported       (US GAAP)                (0.20)           (0.17)
                                            Pro-forma                                  (0.28)           (0.20)
The fair value of each option grant was estimated on the date of
               grant using the Black-Scholes option-pricing model with the
               following weighted-average assumptions: risk-free interest rate
               of 5.49% (1999 - 5.5%), dividend yield of 0%, expected volatility
               of 163% (1999 - 80%), and expected life of 5 years.

                                       64
65

NYMOX PHARMACEUTICAL CORPORATION
Notes to Consolidated Financial Statements, Continued

Years ended December 31, 2000, 1999 and 1998
(in US dollars)

11.  SEGMENT DISCLOSURES:

     Geographic segment information was as follows:
United
                                                    Canada               States
                                               -----------          -----------
Revenues:
         2000                                  $    68,179          $   157,688
         1999                                       40,963              149,240
         1998                                      168,761              104,804

     Net loss:
         2000                                   (2,558,476)          (1,465,503)
         1999                                   (2,631,662)            (682,634)
         1998                                   (1,782,794)          (3,000,419)

     Identifiable assets:
         2000                                    4,110,466              408,172
         1999                                    1,714,416              426,075
         1998                                    3,422,944              565,291
12.  SUBSEQUENT EVENT:

     In February 2001, the Corporation issued 161,696 common shares for gross
     proceeds of $327,273 under the equity drawdown facility referred to in note
     6 (c).

                                       65
66

ITEM 9.  OFFER AND LISTING DETAILS

Nymox's common shares trade on the Nasdaq Stock Market. Nymox's common shares
traded on the Nasdaq National Market from December 1, 1997 until September 16,
1999 when they began trading on the Nasdaq SmallCap Market. Nymox's common
shares also traded on the Montreal Exchange from December 18, 1995 until
November 19, 1999.

The following tables set out the high and low reported trading prices of the
common shares on the Nasdaq Stock Market during the periods indicated.

ANNUAL HIGH AND LOW MARKET PRICES - PAST FIVE YEARS
Year                          Annual High                             Annual Low
----                          -----------                             ----------
1996                            $13.850                                 $1.950
1997                            $10.750                                 $6.250
1998                            $13.625                                 $2.500
1999                            $ 5.875                                 $2.500
2000                            $10.563                                 $1.063
2001                            $ 3.000                                 $1.750
QUARTERLY HIGH AND LOW MARKET PRICES - PAST TWO YEARS
Year             Quarterly Period        High Sales Price        Low Sales Price
----             ----------------        ----------------        ---------------
1999                1st Quarter               $5.875                 $2.875
                    2nd Quarter               $4.188                 $2.750
                    3rd Quarter               $4.750                 $2.500
                    4th Quarter               $4.625                 $2.500
2000                1st Quarter               $10.563                $2.625
                    2nd Quarter               $5.875                 $2.625
                    3rd Quarter               $6.063                 $2.906
                    4th Quarter               $3.875                 $1.063
2001                1st Quarter               $3.000                 $1.750
MONTHLY HIGH AND LOW MARKET PRICES - MOST RECENT SIX MONTHS
Date                           Monthly High                      Monthly Low
--------------                     ------------                      -----------
October, 2000                        $3.875                           $2.531
November, 2000                        $3.031                           $1.250
December, 2000                        $2.750                           $1.063
 January, 2001                        $3.000                           $1.813
February, 2001                        $2.563                           $1.750
   March, 2001                        $2.625                           $1.875
66
67

ITEM 10.  ADDITIONAL INFORMATION

WARRANTS OUTSTANDING
Description           Warrants Issued       Exercise Price          Expiry Date
-----------           ---------------       --------------          ------------
Series K                  100,000               $2.06                Mar 6, 2003
Series H                   66,667               $9.375               Mar 6, 2004
Series I                   26,667               $7.8125              Mar 6, 2004
Series E                  200,000               $4.5315             Nov 30, 2004
Series F                  160,000               $4.0625             Nov 30, 2004
Series G                  109,879               $3.70                Jan 8, 2005
Series G                    5,783               $3.70                Jan 8, 2005
Series J                   42,290               $3.70               Jul 31, 2005
The total number of shares subject to options at March 31, 2001 is 1,649,500, of
which options representing 1,418,167 are currently exercisable. Of those, the
total number of shares subject to options held by directors and officers of
Nymox is 845,000 of which options representing 715,000 shares are currently
exercisable.

There are no rights, warrants or options presently outstanding under which Nymox
could issue additional common shares, with the exception of options enabling
certain directors, employees and consultants of Nymox to acquire common shares
under Nymox's stock option plan and of warrants entitling the holders to acquire
up to 711,286 common shares of Nymox as outlined in the above table.

MEMORANDUM AND ARTICLES OF ASSOCIATION

BYLAWS AND ARTICLES OF INCORPORATION

The company's Articles of Incorporation as amended, which we refer to as our
articles of incorporation, are on file with the Corporations Directorate of
Industry Canada under Corporation Number 315235-9. Our articles of incorporation
do not include a stated purpose and do not place any restrictions on the
business that the company may carry on.

DIRECTORS

A director of our company need not be a shareholder. In accordance with our
bylaws and the Canada Business Corporations Act, a majority of our directors
must be residents of Canada. In order to serve as a director, a person must be a
natural person at least 18 years of age, of sound mind and not bankrupt. Neither
our articles of incorporation or by-laws, nor the Canada Business Corporations
Act, impose any mandatory retirement requirements for directors.

A director who is a party to, or who is a director or officer of or has a
material interest in any person who is a party to, a material contract or
transaction or proposed material contract or transaction with our company must
disclose to the company the nature and extent of his or her

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interest at the time and in the manner provided by the Canada Business
Corporations Act. The Canada Business Corporations Act prohibits such a director
from voting on any resolution to approve the contract or transaction unless the
contract or transaction:

     -   is an arrangement by way of security for money lent to or obligations
         undertaken by the director for the benefit of the company or an
         affiliate;

     -   relates primarily to his or her remuneration as a director, officer,
         employee or agent of the company or an affiliate;

     -   is for indemnity or insurance for director's liability as permitted by
         the Act; or

     -   is with an affiliate.

Our board of directors may, on behalf of the company and without authorization
of our shareholders:

     -   borrow money upon the credit of the company;

     -   issue, reissue, sell or pledge debt obligations of the company;

     -   give a guarantee on behalf of the company to secure performance of an
         obligation of any person; and

     -   mortgage, hypothecate, pledge or otherwise create a security interest
         in all or any property of the company, owned or subsequently acquired,
         to secure any obligation of the company.

The Canada Business Corporations Act prohibits the giving of a guarantee to any
shareholder, director, officer or employee of the company or of an affiliated
corporation or to an associate of any such person for any purpose or to any
person for the purpose of or in connection with a purchase of a share issued or
to be issued by the company or its affiliates, where there are reasonable
grounds for believing that the company is or, after giving the guarantee, would
be unable to pay its liabilities as they become due, or the realizable value of
the company's assets in the form of assets pledged or encumbered to secure a
guarantee, after giving the guarantee, would be less than the aggregate of the
company's liabilities and stated capital of all classes.

These borrowing powers may be varied by the company's bylaws or its articles of
incorporation. However, our bylaws and articles of incorporation do not contain
any restrictions on or variations of these borrowing powers.

COMMON SHARES

Our articles of incorporation authorize the issuance of an unlimited number of
common shares. They do not authorize the issuance of any other class of shares.

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The holders of the common shares of our Company are entitled to receive notice
of and to attend all meetings of the shareholders of our Company and have one
vote for each common share held at all meetings of the shareholders of our
Company. Our directors are elected at each annual meeting of shareholders and do
not stand for reelection at staggered intervals.

The holders of common shares are entitled to receive dividends and our company
will pay dividends, as and when declared by our board of directors, out of
moneys properly applicable to the payment of dividends, in such amount and in
such form as our board of directors may from time to time determine, and all
dividends which our board of directors may declare on the common shares shall be
declared and paid in equal amounts per share on all common shares at the time
outstanding.

In the event of the dissolution, liquidation or winding-up of the company,
whether voluntary or involuntary, or any other distribution of assets of the
company among its shareholders for the purpose of winding up its affairs, the
holders of the common shares will be entitled to receive the remaining property
and assets of the company.

ACTION NECESSARY TO CHANGE RIGHTS OF SHAREHOLDERS

In order to change the rights of our shareholders, we would need to amend our
articles of incorporation to effect the change. Such an amendment would require
the approval of holders of two-thirds of the shares cast at a duly called
special meeting. For certain amendments such as those creating of a class of
preferred shares, a shareholder is entitled to dissent in respect of such a
resolution amending our articles and, if the resolution is adopted and the
company implements such changes, demand payment of the fair value of its shares.

MEETINGS OF SHAREHOLDERS

An annual meeting of shareholders is held each year for the purpose of
considering the financial statements and reports, electing directors, appointing
auditors and for the transaction of other business as may be brought before the
meeting. The board of directors has the power to call a special meeting of
shareholders at any time.

Notice of the time and place of each meeting of shareholders must be given not
less than 21 days, nor more than 50 days, before the date of each meeting to
each director, to the auditor and to each shareholder who at the close of
business on the record date for notice is entered in the securities register as
the holder of one or more shares carrying the right to vote at the meeting.
Notice of meeting of shareholders called for any other purpose other than
consideration of the minutes of an earlier meeting, financial statements and
auditor's report, election of directors and reappointment of the incumbent
auditor, must state the nature of the business in sufficient detail to permit
the shareholder to form a reasoned judgment on and must state the text of any
special resolution or by-law to be submitted to the meeting.

The only persons entitled to be present at a meeting of shareholders are those
entitled to vote, the directors of the company and the auditor of the company.
Any other person may be admitted only on the invitation of the chairman of the
meeting or with the consent of the meeting. In

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circumstances where a court orders a meeting of shareholders, the court may
direct how the meeting may be held, including who may attend the meeting.

LIMITATIONS ON RIGHT TO OWN SECURITIES

Neither Canadian law nor our articles or by-laws limit the right of a
nonresident to hold or vote our shares, other than as provided in the Investment
Canada Act (the "Investment Act"), as amended by the World Trade Organization
Agreement Implementation Act. The Investment Act generally prohibits
implementation of a direct reviewable investment by an individual, government or
agency thereof, corporation, partnership, trust or joint venture that is not a
"Canadian," as defined in the Investment Act (a "non-Canadian"), unless, after
review, the minister responsible for the Investment Act is satisfied that the
investment is likely to be of net benefit to Canada. An investment in our shares
by a non-Canadian (other than a "WTO Investor," as defined below) would be
reviewable under the Investment Act if it were an investment to acquire direct
control of our company, and the value of the assets of our company were CDN$5.0
million or more (provided that immediately prior to the implementation of the
investment our company was not controlled by WTO Investors). An investment in
our shares by a WTO Investor (or by a non-Canadian other than a WTO Investor if,
immediately prior to the implementation of the investment our company was
controlled by WTO Investors) would be reviewable under the Investment Act if it
were an investment to acquire direct control of our company (in 2001) and the
value of the assets of our company equaled or exceeded CDN$209.0 million. A
non-Canadian, whether a WTO Investor or otherwise, would be deemed to acquire
control of our company for purposes of the Investment Act if he or she acquired
a majority of the our shares. The acquisition of less than a majority, but at
least one-third of our shares, would be presumed to be an acquisition of control
of our company, unless it could be established that we were not controlled in
fact by the acquirer through the ownership of our shares. In general, an
individual is a WTO Investor if he or she is a "national" of a country (other
than Canada) that is a member of the World Trade Organization ("WTO Member") or
has a right of permanent residence in a WTO Member. A corporation or other
entity will be a "WTO Investor" if it is a "WTO investor-controlled entity,"
pursuant to detailed rules set out in the Investment Act. The United States is a
WTO Member. Certain transactions involving our shares would be exempt from the
Investment Act, including:

    (a)  an acquisition of our shares if the acquisition were made in the
         ordinary course of that person's business as a trader or dealer in
         securities;

    (b)  an acquisition of control of our company in connection with the
         realization of a security interest granted for a loan or other
         financial assistance and not for any purpose related to the provisions
         of the Investment Act; and

    (c)  an acquisition of control of our company by reason of an amalgamation,
         merger, consolidation or corporate reorganization, following which the
         ultimate direct or indirect control in fact of our company, through the
         ownership of voting interests, remains unchanged.

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CHANGE OF CONTROL

There are no provisions of our bylaws or articles of incorporation that would
have an effect of delaying, deferring or preventing a change in control of the
company and that would operate only with respect to a merger, acquisition or
corporate restructuring involving the company. Our bylaws do not contain a
provision governing the ownership threshold above which shareholder ownership
must be disclosed.

MATERIAL CONTRACTS

The following is a summary of our company's material contracts, entered into
since January 1, 1999.

1.   The Common Stock Purchase Agreement and Registration Rights Agreement
     between Nymox Pharmaceutical Corporation and Jaspas Investments Limited
     dated November 1, 1999. (incorporated by reference to Exhibit 2.0 to the
     Company's form F-1 registration statement filed with the Commission
     February 29, 2000.) These agreements established a $12 million equity line
     of credit which, on March 14, 2000, we became entitled to draw down on. The
     terms and conditions of the equity line of credit are further described in
     the LIQUIDITY AND CAPITAL RESOURCES section in Item 5 above and in more
     detail in our F-1 Registration Statement filed with the SEC on February 29,
     2000 and declared effective on March 14, 2000.

2.   The Research and License Agreement between Rhode Island Hospital
     Corporation and Nymox Corporation dated May 20, 1999. Under this agreement,
     Nymox sponsors the research of two principal investigators, Dr. Suzanne de
     la Monte and Dr. Jack Wands, pertaining to the use of neural thread protein
     for diagnostic or therapeutic purposes in return for licensing rights to
     inventions and patents arising out of this research. The sponsorship
     obligations run for three years from March 1, 1999.

3.   The Share Purchase Agreement between Nymox Pharmaceutical Corporation and
     Dr. Judith Fitzpatrick dated January 8, 2000. Under this agreement which
     closed on March 2, 2000, we acquired 1,008,250 shares of the common stock
     of Serex, Inc. which represented a majority interest of that company in
     return for the issuance of 187,951 of our shares and warrants (Series G) to
     purchase 115,662 of our shares at a strike price of $3.70.

4.   The Employment Agreement between Nymox Pharmaceutical Corporation and Dr.
     Judith Fitzpatrick dated January 8, 2000. Under this agreement Nymox
     employed Dr. Fitzpatrick for four years as a Vice-President of Nymox at a
     salary and with benefits commensurate with that position.

5.   The Common Stock and Warrants Purchase Agreement dated March 6, 2000
     between Nymox Pharmaceutical Corporation and Amro International, S.A.
     ("Amro"). Under this Agreement, Amro purchased 666,667 shares of Nymox and
     warrants to purchase up to 66,667 shares of Nymox at a strike price of
     $9.375 for $4 million. The Agreement

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72
     provided Amro with two opportunities to reprice a portion of the 666,667
     shares it initially purchased. Pursuant to these two repricing obligations,
     Nymox issued Amro a further 154,970 shares.

EXCHANGE CONTROLS

Canada has no system of exchange controls. There are no exchange restrictions on
borrowing from foreign countries or on the remittance of dividends, interest,
royalties and similar payments, management fees, loan repayments, settlement of
trade debts or the repatriation of capital.

There are no limitations on the rights of non-Canadians to exercise voting
rights on their shares of Nymox.

TAXATION

UNITED STATES FEDERAL INCOME TAXATION

The following is, as of the date of this annual report, a general summary of the
material U.S. federal income tax consequences that are applicable to the
following persons who may, directly or indirectly, acquire common shares of
Nymox and hold such common shares as capital assets:

     -    citizens or residents (as specially defined for federal income tax
          purposes) of the United States,

     -    corporations or partnerships created or organized in the United States
          or under the laws of the United States or any state,

     -    estates the income of which is subject to the United States federal
          income taxation regardless of its source and

     -    a trust, if a U.S. court is able to exercise primary supervision over
          the administration of such trust and one or more U.S. persons have the
          authority to control all substantial decisions of such trust or a
          trust that has been elected to be treated as a domestic trust (U.S.
          Shareholders).

This discussion does not deal with:

     -    any aspects of federal income taxation that may be relevant to a
          particular U.S. Shareholder based on his particular circumstances
          (including potential application of the alternative minimum tax or
          unrelated business income tax),

     -    certain U.S. Shareholders subject to special treatment under the
          federal income tax laws or foreign individuals or entities,

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     -    U.S. Shareholders owning directly or by attribution 10% or more of the
          common shares or

     -    any aspect of state, local or non-United States tax laws.

DIVIDENDS PAID ON COMMON SHARES

Subject to the application of the rules relating to a "passive foreign
investment company", referred to as a PFC, distributions paid on common shares
(including any Canadian taxes withheld) to a U.S. Shareholder will be treated as
ordinary income for United States federal income tax purposes to the extent of
Nymox's current and accumulated earnings and profits (as computed for U.S.
federal income tax purposes). Distributions in excess of such earnings and
profits will be applied against the U.S. shareholders tax basis in common
shares, and any distributions in excess of such tax basis will be treated as
gain from the sale or exchange of such common shares. Distributions from Nymox
generally will not qualify for the United States dividends-received deduction
available to corporations. Canadian withholding tax withheld or paid will be
eligible for credit or, at the U.S. Shareholder's election, deduction, subject
to generally applicable limitations.

DISPOSITION OF COMMON SHARES

Subject to the applicable PFC rules discussed below, if a U.S. Shareholder holds
common shares as a capital asset, any gain or loss on a sale or exchange of such
shares will be capital gain or loss, which will be long-term capital gain or
loss if the holding period is one year or more. Generally, the maximum tax rate
for U.S. shareholders who are individuals on long term capital gain is 20%. The
sale of common shares through certain brokers will be subject to the information
reporting and back-up withholding rules of the United States Internal Revenue
Code of 1986, as amended, referred to as the Code.

PASSIVE FOREIGN INVESTMENT COMPANY

For any taxable year of Nymox, if at least 75% of Nymox's gross income is
"passive income" as defined in the Code, or if at least 50% of Nymox's assets,
by average fair market value, are assets that produce or are held for the
production of passive income, Nymox will be a PFC. The PFC determination is made
on the basis of facts and circumstances that may be beyond Nymox's control. It
is not possible to express an opinion as to whether or not Nymox is or will be a
PFC in its current or future taxable years because this depends on, among other
things, the amount and type of gross income that Nymox will earn in the future
and the characterization of certain assets as passive or active, which
determination cannot be made until the facts are known.

If Nymox is a PFC for any taxable year during which a U.S. Shareholder owns,
directly or indirectly, any common shares, the U.S. Shareholder will be subject
to special U.S. federal income tax rules, set forth in Sections 1291 to 1297 of
the Code, with respect to all of such U.S. Shareholder's common shares. In the
absence of (i) an election by such U. S. Shareholder to treat Nymox as a
"qualified electing fund" (the "Q.E.F. Election"), as discussed below, or (ii)
the election to mark to market the common shares (the "Mark to Market
Election"), as described

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below, the U.S. Shareholder would be required to report any gain on the
disposition of any common shares as ordinary income rather than capital gain and
to compute the tax liability on such gain as well as on any "excess
distribution" as defined in the Code, as if such amounts generally had been
earned pro-rata over the U.S. Shareholder's holding period for such common
shares and were subject to the highest ordinary income tax rate for each taxable
year of the U.S. Shareholder during such holding period. Such U.S. Shareholder
would also be liable for interest, which may be non-deductible by certain U.S.
Shareholders, on the foregoing tax liability as if such liability had been due
with respect to each such prior year. In addition, gifts, exchanges pursuant to
corporate reorganizations and the use of common shares as security for a loan
may be treated as taxable dispositions, and a stepped-up basis upon the death of
such a U.S. Shareholder may not be available.

The foregoing rules may be avoided if a Q.E.F. Election is in effect with
respect to a U. S. Shareholder for each of the years that Nymox is a PFC during
such U.S. Shareholder's holding period. A Q.E.F. Election may be made by a U.S.
Shareholder on or before the due date, including extensions, for filing such
U.S. Shareholder's tax return for such taxable year. Such a U.S. Shareholder
would be taxed on its pro-rata share of Nymox's earnings and profits for Nymox's
taxable year in which it was, or was treated as, a PFC and which ends with or
within such U.S. Shareholder's taxable year, regardless of whether such amounts
are actually distributed by Nymox. This may result in tax liability without a
commensurate distribution with which to pay the liability. An electing U.S.
Shareholder's basis in the common shares would be increased by the amounts
included in income. Distributions out of earnings and profits previously
included by such U.S. Shareholder generally would not be treated as a taxable
dividend for United States federal income tax purposes and would result in a
corresponding reduction of basis in common shares. An electing U.S. Shareholder
will not be currently taxed on the undistributed ordinary income and net capital
gain of Nymox for any year that Nymox is not classified as a PFC.

If Nymox is a PFC, a U.S. Shareholder may avoid certain of the tax consequences
described in the preceding two paragraphs if the Nymox common stock is
marketable and meets the other requirements of Section 1296 of the Code, and the
U.S. Shareholder elects to mark to market the common stock on an annual basis.
The common stock will be marketable so long as it is regularly traded on a
recognized exchange.

In general, a U.S. Shareholder in a PFC who elects under Section 1296 to mark
the common stock to market would include in income each year an amount equal to
the excess, if any, of the fair market value of the common stock as of the close
of the taxable year over the U.S. Shareholder's adjusted basis in such stock. A
U.S. Shareholder who makes the Section 1296 election would also generally be
allowed a deduction for the excess, if any, of the adjusted basis of the common
stock over the fair market value as of the close of the taxable year. Deductions
under this rule, however, are allowable only to the extent of any net mark to
market gains with respect to the common stock included by the shareholder for
prior taxable years.

Once the Mark to Market election is made, it is binding for all subsequent
years, unless the common stock ceases to be marketable, or the IRS consents to
the revocation of the election.

If Nymox is a PFC, each U.S. Shareholder is strongly urged to consult with his
or her tax advisor to determine whether the Q.E.F. Election or the Mark to
Market Election should be made. Each

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requires attention to specific rules and regulations, and each may not be
available to a specific U.S. shareholder.

Nymox intends to notify its U.S. Shareholders within 45 days after the end of
the taxable year for which Nymox believes it might be a PFC. Nymox has further
undertaken (i) to provide its U.S. Shareholders with timely and accurate
information as to its status as a PFC and the manner in which the Q.E.F.
Election can be made and (ii) to comply with all record-keeping, reporting and
other requirements so that U.S. Shareholders, at their option, may make a Q.E.F.
Election.

FUTURE DEVELOPMENTS

The foregoing discussion is based on existing provisions of the Code, existing
and proposed regulations thereunder and current administrative rulings and court
decisions, all of which are subject to change. Any such changes could affect the
validity of this discussion. In addition, the implementation of certain aspects
of the PFC rules requires the issuance of regulations which in many instances
have not been promulgated and which may have retroactive effect.

There can be no assurance that current authorities will not be changed and, if
so, as to the form they will take or the effect they may have on this
discussion.

CANADIAN FEDERAL INCOME TAXATION

The following is, as of the date of annual report, a summary of the principal
Canadian federal income tax considerations generally applicable to shareholders
who receive a dividend from Nymox and who, at all relevant times, for purposes
of the Income Tax Act (Canada) the ("Tax Act"), hold and will hold Nymox common
shares as capital property and deal with Nymox at arm's length.

Nymox's common shares will generally constitute capital property to a holder
unless the holder holds such shares in the course of carrying on a business or
the holder has acquired such shares in a transaction or transactions considered
to be an adventure in the nature of trade. This summary is based on the current
provisions of the Tax Act, the regulations under that act, counsel's
understanding of current administrative and assessing policies of the Canada
Customs and Revenue Agency and all specific proposals to amend the Tax Act
publicly announced or released by or on behalf of the Minister of Finance
(Canada) before the date of this annual report ("Tax Proposals").

The Tax Act contains certain provisions relating to securities held by certain
financial institutions (the "Mark-to-Market Rules"). This summary does not take
into account these Mark-to-Market Rules or any amendments to them contained in
the Tax Proposals and taxpayers that are "financial institutions" for purposes
of those rules should consult their own tax advisors.

This summary is not exhaustive of all possible Canadian federal income tax
considerations and, except for the Tax Proposals, does not take into account or
anticipate any changes in law, whether by legislative, governmental or judicial
action, nor does it take into account tax legislation of any province, territory
or foreign jurisdiction. This summary is of a general nature

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only and is not intended to be, nor should it be construed as, legal or tax
advice to any particular holder of Nymox common shares.

CANADIAN RESIDENTS

The following summary is relevant to a holder of Nymox common shares who, for
purposes of the Tax Act and any applicable tax treaty or convention, is resident
in Canada at all relevant times.

Tax Treatment of Capital Gains and Capital Losses for Canadian Residents

On a disposition or deemed disposition of a Nymox common share, the holder will
realize a capital gain (or capital loss) equal to the amount by which the
proceeds of disposition for the Nymox common share exceed (or are less than) the
aggregate of any costs of disposition and the adjusted cost base to the holder
of the Nymox common share immediately before the disposition.

Pursuant to the Tax Proposals and subject to certain transitional rules which
apply in certain circumstances, a holder of Nymox common shares will be required
to include in income one-half of the amount of any capital gain (a "Taxable
capital gain") and may deduct one-half of the amount of any capital loss (an
"Allowable capital loss") against Taxable capital gains realized by the holder
in the year of the disposition. Allowable capital losses in excess of Taxable
capital gains may be carried back and deducted in any of the three preceding
years or carried forward and deducted in any following year against taxable
capital gains realized in such years to the extent and under the circumstances
described in the Tax Act and the Tax Proposals.

A Canadian-controlled private corporation will also be subject to a refundable
tax of 6 2/3% on certain investment income, including taxable capital gains
realized on the disposition of Nymox common shares, that will be refunded when
the corporation pays taxable dividends (at a rate of $1.00 for every $3.00 of
taxable dividend paid).

A capital loss realized by a holder of Nymox common shares that is a
corporation, a partnership of which a corporation is a member or a trust of
which a corporation is a beneficiary may be reduced by the amount of dividends
received in certain circumstances. Capital gains realized by an individual may
give rise to a liability for alternative minimum tax.

Tax Treatment of Dividends Received by Canadian Residents

In the case of a holder of Nymox common shares who is an individual, any
dividends received on the common shares will be included in computing his income
and will be subject to the gross-up and dividend tax credit rules normally
applicable to taxable dividends paid by taxable Canadian corporations. A holder
that is a corporation may be liable to pay refundable tax under Part IV of the
Tax Act. However, a public corporation which is not controlled, whether because
of a beneficial interest in one or more trusts or otherwise, by or for the
benefit of an individual (other than a trust) or a related group of individuals
(other than trusts) will not be liable to pay refundable tax under Part IV of
the Tax Act.

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In the case of a holder of Nymox common shares that is a corporation, the amount
of any capital loss otherwise determined resulting from the disposition of a
Nymox common share may be reduced by the amount of dividends previously received
or deemed to have been received thereon. Any such restriction will not occur
where the corporate holder owned the Nymox common share for 365 days or longer
and such holder (together with any persons with whom it did not deal at arm's
length) did not own more than 5% of the shares of any class or series of Nymox
at the time the relevant dividends were received or deemed to have been
received. Analogous rules apply where a corporation is a member of a partnership
or a beneficiary of a trust, which owns Nymox common shares.

SHAREHOLDERS WHO ARE NOT RESIDENTS OF CANADA

The following summary is relevant to a holder of Nymox common shares, who, at
all relevant times, for purposes of the Tax Act and any applicable tax treaty or
convention, is a non-resident or is deemed to be a non-resident of Canada and
does not use and is not deemed to use or hold Nymox common shares in the course
of carrying on a business in Canada. Special rules, which are not discussed
below, may apply to a non-resident that is an insurer which carries on business
in Canada and elsewhere.

Dividends Paid To Non-Residents of Canada

Under the Tax Act, dividends paid or credited to a non-resident are subject to
withholding tax at the rate of 25% of the gross amount of the dividends. This
withholding tax may be reduced or eliminated pursuant to the terms of an
applicable tax treaty between Canada and the country of residence of the
non-resident. For example, for persons who are resident in the United States for
purposes of the Canada-United States Income Tax Convention, (the "Convention")
the rate of withholding tax on dividends is reduced to 15% generally and 5% when
the United States resident is a company that beneficially owns at least 10% of
the voting stock of the company paying the dividends.

Under the Convention, dividends paid to certain religious, scientific,
charitable and other similar tax-exempt organizations and certain organizations
that are resident in, and exempt from tax in, the United States are exempt from
Canadian non-resident withholding tax. Provided that certain administrative
procedures designed to establish with the Canadian tax authorities the right of
such entities to benefit from this withholding tax exemption are complied with
by the tax-exempt entities prior to the Distribution, Nymox would not be
required to withhold such tax on such payment. Alternatively, the
above-described tax-exempt entities may claim a refund of Canadian withholding
tax otherwise withheld by Nymox on the distribution of dividends.

Tax Treatment of Capital Gains of Non-Residents of Canada

On a disposition or deemed disposition of a Nymox common share, a non-resident
holder will realize a capital gain (or capital loss) equal to the amount by
which the proceeds of disposition for the Nymox common share exceed (or are less
than) the aggregate of any costs of disposition and the adjusted cost base to
the non-resident holder of the Nymox common share immediately before the
disposition.

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A non-resident of Canada is liable for Canadian income tax on a capital gain
realized on the disposition of property only where that property constitutes
"taxable Canadian property". Pursuant to the Tax Proposals and subject to
certain transitional rules which apply in certain circumstances, one-half of any
capital gain from the disposition of taxable Canadian property is subject to
Canadian tax.

Under the Tax Act, shares of Nymox will not constitute taxable Canadian property
unless, at any time, in the five years immediately preceding the disposition,
the non-resident holder, persons with whom the non-resident holder did not deal
at arms length, or the non-resident holder together with all such persons owned
(or had a right to acquire) 25% or more of the shares of any class of Nymox.
Even in circumstances where shares of Nymox are taxable Canadian property to a
non-resident holder, the non-resident holder may be entitled to relief from
Canadian tax on any capital gain realized on the disposition thereof pursuant to
the terms of an applicable tax treaty between Canada and the country of
residence of the non-resident. For example, the Convention provides that gains
realized by a resident of the United States on the disposition or deemed
disposition of shares of a company will generally not be subject to tax under
the Tax Act, provided that the value of the shares is not derived principally
from real property situated in Canada. Nymox believes that the value of its
shares is not currently derived principally from real property situated in
Canada and it does not expect this to change in the foreseeable future.

Provided that the Nymox common shares remain listed on a prescribed stock
exchange, which includes the Nasdaq SmallCap Market System, a non-resident
holder who disposes of Nymox common shares will not be required to comply with
the Canadian notification procedures generally applicable to dispositions of
taxable Canadian property.

ITEM 11. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Not applicable.

ITEM 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES

Not applicable

PART II

ITEM 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES

Not applicable

ITEM 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF
         PROCEEDS

Not applicable

PART III

ITEM 17. FINANCIAL STATEMENTS

The financial statements listed in item 19 are incorporated by reference in this
item.

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ITEM 18. FINANCIAL STATEMENTS

Not applicable

ITEM 19. FINANCIAL STATEMENTS AND EXHIBITS

a)       Financial statements (which appear in Item 8):

At and for the year ended December 31, 2000:

         Consolidated Balance Sheet
         Consolidated Statement of Earnings and Deficit
         Consolidated Statements of Cash Flows Notes

At and for the year ended December 31, 1999:

         Consolidated Balance Sheet
         Consolidated Statement of Earnings and Deficit
         Consolidated Statements of Cash Flows
         Notes

At and for the year ended December 31, 1998:

         Consolidated Statement of Earnings and Deficit
         Consolidated Statements of Cash Flows
         Notes

SIGNATURES

Pursuant to the requirements of Section 12 of the Securities Exchange Act of
1934, the registrant certifies that it meets all of the requirements for filing
on Form 20 - F and has duly caused this registration statement to be signed on
its behalf by the undersigned, thereunto duly authorized.

                                              NYMOX PHARMACEUTICAL CORPORATION
                                                        (Registrant)

                                                     /S/ Paul Averback
                                                     -----------------
                                                     Paul Averback
                                                     Title: President

Date: May 8, 2001

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EXHIBIT INDEX
NYMOX PHARMACEUTICAL CORPORATION

Form 20-F Annual Report
EXHIBIT NO.                                        DESCRIPTION                                   PAGE NO.
1(a)                Articles of Incorporation, as amended. (incorporated by reference
                                  to Exhibit 3.1 to the Company's 20-F filed with the Commission
                                  December 9, 1996.)                                                          N\A

              1(b)                Bylaws of the Company (incorporated by
                                  reference to Exhibit 3.2 to the Company's 20-F
                                  filed with the Commission December 9, 1996.)                                N\A

              4(a)                Memorandum of Agreement between Paul Averback
                                  and the Company (incorporated by reference to
                                  Exhibit 10.1 to the Company's 20-F filed with
                                  the Commission December 9, 1996.)                                           N\A

              4(b)                Share Option Plan of the Company (incorporated by reference to
                                  Exhibit 10.2 to the Company's 20F filed with
                                  the Commission December 9, 1996.)                                           N\A

              4(c)                Research and License Agreement between the Massachusetts General
                                  Hospital Corporation and the Company (incorporated by reference
                                  to Exhibit 10.3 to the Company's 20-F filed
                                  with the Commission December 9, 1996.)                                      N\A

              4(d)                Research and License Amendment between the Massachusetts General
                                  Hospital Corporation and the Company (incorporated by reference
                                  to Exhibit 10.5 to the Company's 20-F filed
                                  with the Commission December 9, 1996.)                                      N\A

              4(e)                Common Stock Purchase Agreement between Nymox Pharmaceutical
                                  Corporation and Jaspas Investments Limited dated November 1, 1999
                                  (incorporated by reference to Exhibit 2.0 to the Company's form
                                  F-1 registration statement filed with the
                                  Commission February 29, 2000.)                                              N\A

              4(f)                Registration Rights Agreement between Nymox Pharmaceutical
                                  Corporation and Jaspas Investments Limited dated November 1, 1999
                                  (incorporated by reference to Exhibit 2.1 to the Company's form
                                  F-1 registration statement filed with the
                                  Commission February 29, 2000.)                                              N\A

              4(g)                Escrow Agreement among Nymox Pharmaceutical Corporation, Jaspas
                                  Investments Limited and Epstein, Becker & Green, P.C. dated
                                  November 1, 1999 (incorporated by reference to Exhibit 2.2 to the
                                  Company's form F-1 registration statement
                                  filed with the Commission February 29, 2000.)                               N\A

              4(h)                Stock Purchase Warrant to purchase common
                                  shares issued to Jaspas Investments Limited
                                  dated November 1, 1999 (incorporated by
                                  reference to Exhibit 2.3 to the Company's form
                                  F-1 registration statement filed with the
                                  Commission February 29, 2000.)                                              N\A

              4(i)                Employment Agreement between Nymox Pharmaceutical Corporation and
                                  Dr. Judith Fitzpatrick (incorporated by reference to Exhibit 2.4
                                  to the Company's form F-1 registration statement filed with the
                                  Commission February 29, 2000.)                                              N\A

              4(j)                Research and License Agreement between the Rhode Island Hospital
                                  Corporation and the Company dated May 14, 1999 (incorporated
                                  by reference to Exhibit 10.10 to the Company's 20-F filed with the
                                  Commission May 15, 2000.)                                                   N\A
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