CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (USD $)	9 Months Ended		264 Months Ended
	Sep. 30, 2011	Sep. 30, 2010	Sep. 30, 2011
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss	$ (3,423,862)	$ (1,037,969)	$ (12,515,803)
Adjustments to reconcile net earnings to net cash used in operating activities
Stock based compensation	25,000	667,300	3,998,076
Depreciation and amortization	23,011	11,448	373,248
Unrealized gain on derivative liabilities - warrant instruments	2,289,651	(1,046,806)	295,859
Unrealized gain on derivative liabilities - options	(5,975)	(8,342)	(24,567)
Unrealized gain on derivative liabilities - note conversion feature	(181,017)	(153,608)	(90,796)
Amortization of debt discount	390,058	23,333	560,000
Amortization of deferred financing costs	15,000	833	20,833
Write-off of license fee			1,250
Gain/loss on sale of assets	(3,000)	(2,068)	(4,830)
Foreign currency translation adjustments			3,247
Gain on extinguishment of debt			(1,326,028)
Interest expense incurred on issuance of convertible debt		643,886	643,886
Changes in operating assets and liabilities
Accounts receivable	(35,000)		139,222
Other assets	8,615	(478)	30,277
Advances on research grants		(25,415)
Accounts payable and accrued liabilities	537,126	(221,898)	1,423,555
Net cash used in operating activities	(360,393)	(1,149,784)	(6,472,571)
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from sale of equipment	3,000	2,068	6,327
Purchase of equipment			(37,443)
Organizational costs			(560)
Purchases of patents, trademarks and licenses	(37,934)	(34,388)	(546,909)
Net cash used in investing activities	(34,934)	(32,320)	(578,585)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from warrant exercises and sales of common stock	144,872	1,095,253	4,243,008
Proceeds from stockholders' advances	10,125	10,125	199,356
Repayment of line of credit from affiliated entity			(341,107)
Proceeds/repayments of short-term debt	1,774	1,777	(103,180)
Proceeds from convertible short-term debt, net		480,000	480,000
Proceeds from line of credit from affiliated company			2,680,882
Proceeds/repayments of long-term debt, net	(7,254)	(45,168)	(91,226)
Acquisition of treasury stock			(13,617)
Net cash provided by financing activities	149,517	1,541,987	7,054,116
NET INCREASE IN CASH	(245,810)	359,883	2,960
Cash at beginning of period	248,770	20,041
Cash at end of period	2,960	379,924	2,960
Supplemental cash flow information:
Interest expense paid in cash	0	0	0
Income taxes paid in cash	0	0	0
Non-cash investing and financing activities:
Accrued salaries converted to notes payable			479,484
Derivative liability incurred through issuance of warrants		3,370,622	3,370,622
Settlement of derivative liabilities		1,057,699	1,057,699
Interest converted to note payable			159,462
Common stock issued to extinguish related party debt		50,000	1,468,768
Discount on note payable related to deferred financing costs	60,000	60,000	60,000
Discount on note payable related to derivative conversion feature		500,000	500,000
Conversion of notes payable and accrued interest	597,519		597,519
Derivative liability settled with warrant exercise	265,101		265,101
Derivative liability settled with note conversion	560,572		560,572
Preferred stock issued for accrued salaries	$ 60,000		$ 60,000

BIOMODA INC/NM 10-Q