AMDL, Inc., incorporated on May 13, 1988, is a theranostics (therapy and diagnosis) company involved in the detection and treatment of cancer. AMDL develops, manufactures, markets and sells various immunodiagnostic kits for the detection of cancer and other diseases. Its products may be used by hospital, clinical, research and forensic laboratories and doctor's offices to obtain precise and rapid identification of certain types of cancer and other diseases. The Company's DR-70 test kit is used to assist in the detection of at least 13 different types of cancer, including lung (small and non-small cell), stomach, breast, rectal colon and liver. As DR-70 is a non-invasive blood test, there are no side effects to the Company's test. AMDL primarily sells DR-70 primarily in Asia. It has also received approvals to import and market DR-70 in Canada (for lung cancer), Australia and the United Kingdom. In addition, the Company has received certification for EN ISO 13485, within the medical and diagnostic device industry. DR-70 is not yet cleared for sale in the United States. The Company conducted clinical trials comparing the DR-70 to the assay, CEA, and AMDL submitted the results to the FDA in September 2003. The Food and Drug Administration (FDA) identified deficiencies in the application and the FDA advised the Company's consultant Diagnostic Oncology CRO, Inc. (DOCRO) that based upon the data submitted, the FDA determined that the DR-70 kit was not substantially equivalent to any other device, which has gone through the 510(k) approval process. Then, in January 2005, DOCRO submitted on the Company's behalf additional data and a new application to the FDA for 510(k) clearance to market the DR-70 test in conjunction with the CEA test as an aid in monitoring patients previously diagnosed with progressing colorectal cancer. In June 2005, the FDA issued a non-substantially equivalent letter and pointed out several areas of concern regarding the new application for use of DR-70 as an adjunctive test with CEA. Representatives of DOCRO and the Company met with the FDA in June 2005 to go over the FDA's specific concerns. AMDL is in the process of reviewing additional patient data that may support substantial equivalence to CEA. AMDL also offers a line of blood tests that are designed to help diagnose a particular kind of cancer. These tests are generally known by the symbols that denote the type of cancer, such as CEA for colon cancer and PSA for prostate cancer. The Company's other product, the Pylori-Probe diagnostic kit, is cleared for sale in the United States. The Company's primary original equipment manufacturer (OEM) product is a ketone strip, which is used by diabetics and those on high-protein diets to monitor ketones, which if elevated, can cause kidney damage in patients. AMDL also offers a line of diagnostic test kits for allergy, autoimmune, cancer markers, clinical chemistry, drugs of abuse, fertility, gastrointestinal disease, serology, serum proteins, thyroid, urine chemistry and others. The Company's largest customer for its ketone strips has filed for protection under federal bankruptcy laws and has shifted into another line of business. In August 2001, AMDL acquired a combination immunogene therapy technology that may be effective in building a cancer patient's immune system and could eventually lead to a vaccine to protect patients known to be at risk because of a family history for certain types of cancer. The combination therapy is intended to both build the body's immune system and destroy cancer cells. This technology involves injecting the cancer patient's tumor with a vector carrying both a granulocyte-macrophage colony stimulating factor and a t-cell, co-stimulating factor, thereby activating an immune response against the cancer cells. Preliminary tests in Canada conducted on mice injected with human skin and brain cancers indicated that the combination therapy can be effective. In addition, Phase 1 clinical trials have been completed in Canada. On November 21, 2005, AMDL executed a letter