Edgar Filing: SAMARITAN PHARMACEUTICALS INC

As filed with the Securities and Exchange Commission on July 30, 2003
Registration No. 333-105818

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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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AMENDMENT NO. 1 TO THE
FORM SB-2
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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SAMARITAN PHARMACEUTICALS, INC.
(Exact name of registrant as specified in its charter)

Nevada 8731 88-0431538
(State or other jurisdiction (Primary standard industrial (IRS employer
of incorporation or organization) Classification number) identification
number)
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101 Convention Center Drive, Suite 310
Las Vegas, Nevada 89109
(702) 735-7001
(Address and telephone number of principal executive
offices and principal place of business)

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Eugene Boyle
Chief Financial Officer
Samaritan Pharmaceuticals, Inc.
101 Convention Center Drive, Suite 310,
Las Vegas, Nevada 89109
Phone: (702) 735-7001 Fax: (702) 737-7016
(Name, address and telephone number of agent for service)

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Copies to:

Clayton E. Parker
Troy J. Rillo
Kirkpatrick & Lockhart LLP
201 South Biscayne Blvd., Suite 2000
Miami, Florida 33131
Phone: (305) 539-3300 Fax: (305) 358-7095

Approximate date of commencement of proposed sale to the public: As soon as
practicable after the effective date of this registration statement.

If this form is filed to register additional securities for an offering pursuant
to Rule 462(b) under the Securities Act, check the following box and list the
Securities Act registration statement number of the earlier effective
registration statement for the same offering. |_|

If any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. |X|

If this form is a post-effective amendment filed pursuant to Rule 462(c) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. |_|

If this form is a post-effective amendment filed pursuant to Rule 462(d) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. |_|

If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. |_|

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CALCULATION OF REGISTRATION FEE

----------------------------- ------------------- ----------------------------- ------------------------ -------------------
Amount of
Title of Each Class of Proposed Amount Proposed Maximum Offering Proposed Maximum Registration
Securities to be Registered to be Registered Price Per Share (1) Offering Price (1) Fee(2)
----------------------------- ------------------- ----------------------------- ------------------------ -------------------
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Common Stock, $.001 par
value ------------------ $0.155 $2,809,375 $227.28
18,125,000
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(1) This price is used solely for the purposes of computing the amount
of the registration fee pursuant to Rule 457(c) of the Securities Act
and is estimated, based on the high and low prices of the common stock
on May 28, 2003.

(2) Previously Paid.

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The Registrant hereby amends this Registration Statement on such date or dates
as may be necessary to delay its effective date until the Registrant shall file
a further amendment which specifically states that this Registration Statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.

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SUBJECT TO COMPLETION, DATED JULY 30, 2003.

The information in this Prospectus is not complete and may be changed. We may
not sell these securities until the registration statement filed with the
Securities and Exchange Commission is effective. This Prospectus is not an offer
to sell these securities and we are not soliciting offers to buy these
securities in any state where the offer or sale is not permitted.

PROSPECTUS

SAMARITAN PHARMACEUTICALS, INC.

18,125,000 Shares of Common Stock

This prospectus relates to the sale of up to 18,125,000 shares of our common
stock by Fusion Capital Fund II, LLC. Fusion Capital is sometimes referred to in
this prospectus as the selling stockholder. The prices at which Fusion Capital
may sell the shares will be determined by the prevailing market price for the
shares or in negotiated transactions. We will not receive proceeds from the sale
of our shares by Fusion Capital.

Our common stock is quoted on the Nasdaq Over-The-Counter Bulletin Board under
the symbol "SPHC." On July 28, 2003, the last reported sale price for our common
stock as reported on the Nasdaq Over-The-Counter Bulletin Board was $0.21 per
share.

The selling stockholder is an "underwriter" within the meaning of the Securities
Act of 1933, as amended.

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The securities offered in this prospectus involve a high degree of risk. You
should consider the "risk factors" beginning on page 4 before purchasing our
common stock.

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Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or passed upon the
adequacy or accuracy of this prospectus. Any representation to the contrary is a
criminal offense.

The date of this prospectus is ___________.

Table of Contents
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Prospectus Summary.......................................................... 3
Risk Factors................................................................ 4
Cautionary Note Regarding Forward-Looking Statements........................ 11
Use of Proceeds............................................................. 11
Market for Common Equity and Related Stockholder Matters.................... 12
Plan of Operation........................................................... 13
Business.................................................................... 19
The Fusion Transaction...................................................... 25
Management.................................................................. 28
Security Ownership of Certain Beneficial Owners and Management.............. 38
Selling Stockholder......................................................... 39
Plan of Distribution....................................................... 40
Description of Capital Stock................................................ 41
Shares Eligible For Future Sale............................................. 43
Legal Opinion............................................................... 44
Experts..................................................................... 44
Changes In And Disagreements With Accountants
On Accounting And Financial Disclosure................................. 44
Additional Information...................................................... 45
Index to Financial Statements............................................... F-1

Unless otherwise specified, the information in this prospectus is set forth as
of July 29, 2003, and we anticipate that changes in our affairs will occur after
such date. We have not authorized any person to give any information or to make
any representations, other than as contained in this prospectus, in connection
with the offer contained in this prospectus. If any person gives you any
information or makes representations in connection with this offer, do not rely
on it as information we have authorized. This prospectus is not an offer to sell
our common stock in any state or other jurisdiction to any person to whom it is
unlawful to make such offer.

PROSPECTUS SUMMARY

The following summary highlights selected information from this prospectus and
may not contain all the information that is important to you. To understand our
business and this offering fully, you should read this entire prospectus
carefully, including the financial statements and the related notes beginning on
page F-1. When we refer in this prospectus to the "company," "we," "us," and
"our," we mean Samaritan Pharmaceuticals, Inc., a Nevada corporation, together
with our subsidiaries.

Our Company

Samaritan Pharmaceuticals, Inc. is a development stage biotechnology company
engaged in the research and development of novel therapeutic and diagnostic
products to treat chronic debilitating diseases such as Alzheimer's, Cancer,
central nervous system ("CNS") disorders, cardiovascular disease and HIV.

Our overall corporate strategy is to build a robust technology pipeline by (1)
In-licensing early-stage patented technologies from Academic Research Centers,
and (2) Focus on the discovery and the development of new drug compounds and
technology to add to our pipeline at Samaritan Laboratories, in collaboration
with Georgetown University.

Samaritan was formed in September 1994 and became public in October 1997. Our
principal executive offices are located at 101 Convention Center Drive, Suite
310, Las Vegas, Nevada 89109. Our telephone number is (702) 735-7001. The
address of our website is www.samaritanpharmaceuticals.com. Information on our
website is not part of this prospectus.

The Offering

On April 22, 2003, we entered into a common stock purchase agreement with Fusion
Capital Fund II, LLC pursuant to which Fusion Capital agreed to purchase on each
trading day during the term of the agreement, $20,000 of our common stock or an
aggregate of $10.0 million. The $10.0 million of common stock is to be purchased
over a 25-month period, subject to a 6-month extension or earlier termination at
our discretion. The purchase price of the shares of common stock will be equal
to a price based upon the future market price of the common stock without any
fixed discount to the market price. Fusion Capital does not have the right or
the obligation to purchase shares of our common stock in the event that the
price of our common stock is less than $0.10.

We have authorized the sale and issuance of 18,125,000 shares of our common
stock to Fusion Capital under the common stock purchase agreement. We estimate
that the maximum number of shares we will sell to Fusion Capital under the
common stock purchase agreement will be 15,000,000 shares (exclusive of the
3,125,000 shares issued to Fusion Capital as the commitment fee) assuming Fusion
Capital purchases all $10.0 million of common stock.

Fusion Capital may not purchase shares of our common stock under the common
stock purchase agreement if Fusion Capital, together with its affiliates, would
beneficially own more than 9.9% of our common stock outstanding at the time of
the purchase by Fusion Capital. However, even though Fusion Capital may not
receive additional shares of our common stock in the event that the 9.9%
limitation is ever reached, Fusion Capital is still obligated to pay to us
$20,000 on each trading day, unless the common stock purchase agreement is
suspended, an event of default occurs or the agreement is terminated. Absent
these circumstances, Fusion Capital would have the right to acquire additional
shares in the future should its ownership subsequently become less than the
9.9%. Fusion Capital has the right at any time to sell any shares purchased
under the common stock purchase agreement that would allow it to avoid the 9.9%
limitation. Therefore, we do not believe that Fusion Capital will ever reach the
9.9% limitation.

Fusion Capital may terminate the common stock purchase agreement without any
liability or payment to us if:

o this registration statement is no longer effective,

o the trading of our common stock is suspended for three consecutive days
or is de-listed from its principal market,

o our transfer agent fails to deliver stock that Fusion entitled to for
five trading days,

o our material breach of the common stock purchase agreement,

o our default on the payment of $1.0 million or more, or

o upon the filing of a bankruptcy or insolvency proceeding.

RISK FACTORS

An investment in our common stock is highly speculative, involves a high degree
of risk, and should be made only by investors who can afford a complete loss.
You should carefully consider the following risk factors, together with the
other information in this prospectus, including our financial statements and the
related notes, before you decide to buy our common stock. Our most significant
risks and uncertainties are described below; however, they are not the only
risks we face. These risks may cause our business, financial condition, or
results of operations to be materially adversely affected and the trading price
of our common stock to decline. This may result in you losing all or part of
your investment. As used in this prospectus, the terms "we," "us," "our," "the
Company" and "Samaritan" mean Samaritan Pharmaceuticals, Inc. a Nevada
corporation, unless the context indicates a different meaning.

Risks Related To Our Financial Condition

We Have A Limited Operating History With Significant Losses And Expect Losses To
Continue For The Foreseeable Future

We are a biopharmaceutical company in a research and development stage. We have
been unprofitable since our inception and have incurred significant losses. Our
net losses since inception on September 5, 1994 to March 31, 2003 were $18.4
million. We had net losses of $4.0 million in each of the last two years ended
December 31, 2002 and a net loss of $600,000 in the three months ended March 31,
2003. These losses have resulted principally from costs incurred in our research
and development programs and from our general and administrative costs. We
expect to continue to incur losses and we may never be profitable. We have
derived no significant revenues from product sales or royalties. We do not
expect to achieve significant product sales or royalty revenue in the near
future and are not able to predict when we might do so. Furthermore we may never
do so. We expect to continue to incur substantial additional operating losses in
the future. These losses may increase significantly as we expand development and
clinical trial efforts although we prioritize our capital to technologies
closest to commercialization.

Even With Our Financing Arrangement With Fusion Capital, We May Require
Additional Financing To Sustain Our Operations

We will require substantial funds to sustain operations and to grow our
business. The amount of which will depend, among other things, on the rate of
progress and the cost of our research and product development programs and
clinical trial activities, the cost of preparing, filing, prosecuting,
maintaining and enforcing patent claims and other intellectual property rights,
and the cost of developing manufacturing and marketing capabilities, if we
decide to undertake those activities. The clinical development of a therapeutic
product is a very expensive and lengthy process and may be expected to utilize
$5 to $20 million over a three to six year development cycle. We currently do
not have available the financial resources to complete the clinical development
of any of our therapeutic products without a strategic partner. Although we
believe we could license the manufacturing and marketing rights to our products
in return for up-front licensing and other fees and royalties on any sales,
there can be no assurance that we will be able to do so in the event we seek to
do so. We need to obtain additional funds to develop our therapeutics products
and our future access to capital is uncertain. The allocation of limited
resources is an ongoing issue for us as we move from research activities into
the more costly clinical investigations required to bring therapeutic products
to market.

We only have the right to receive $20,000 per trading day under the agreement
with Fusion Capital unless our stock price equals or exceeds $0.45, in which
case the daily amount may be increased at our option. Generally, Fusion Capital
shall not be obligated to purchase any shares of our common stock on any trading
days that the market price of our common stock is less than $0.10. Since we
initially registered 15,000,000 shares for sale by Fusion Capital pursuant to
this prospectus (excluding the total of 3,125,000 shares issuable to Fusion
Capital as a commitment fee), the selling price of our common stock to Fusion
Capital will have to average at least $0.67 per share for us to receive the
maximum proceeds of $10.0 million without registering additional shares of
common stock. Assuming a purchase price of $0.22 per share (the closing sale
price of the common stock on July 24, 2003) and the purchase by Fusion Capital
of the full 15,000,000 shares under the common stock purchase agreement,
proceeds to us would be $3,300,000.

The extent we rely on Fusion Capital as a source of funding will depend on a
number of factors including, the prevailing market price of our common stock and
the extent to which we are able to secure working capital from other sources. If
obtaining sufficient financing from Fusion Capital were to prove prohibitively
expensive, we will need to secure another source of funding in order to satisfy
our working capital needs. Even if we are able to access the full $10.0 million
under the common stock purchase agreement with Fusion Capital, we may still need
additional capital to fully implement our business, operating and development
plans. Other than the agreement with Fusion Capital, we do not have any
commitments or arrangements to obtain any such funds and there can be no
assurance that any additional funds, whether through exercise of warrants and
stock options, additional sales of securities or collaborative or other
arrangements with corporate partners or from other sources, will be available to
us upon terms acceptable to us or at all. If we are unable to obtain additional
financing we might be required to delay, scale back or eliminate certain of our
research and product development programs or clinical trials, or be required to
license third parties to commercialize products or technologies that we would
otherwise undertake ourselves, or cease certain operations all together, any of
which might have a material adverse effect upon us. If we raise additional funds
by issuing equity securities, dilution to stockholders may result, and new
investors could have rights superior to holders of shares purchased in this
offering. Should the financing we require to sustain our working capital needs
be unavailable or prohibitively expensive when we require it, the consequences
would be a material adverse effect on our business, operating results, financial
condition and prospects.

Risks Related To Our Business

We Are In The Development Stage And None Of Our Products Have Completed Clinical
Trials, And May Never Demonstrate Sufficient Safety And Efficacy In Order To Do
So.

All of our products are in the development stage and most of our products are in
the preclinical or research stage. We have only one product (SP001 and its
bioequivalent HIV drugs) currently in clinical trials which has recently
completed a phase II clinical trial. In order to achieve profitable operation we
must successfully develop, manufacture, introduce and market our products. The
time frame necessary to achieve market success for any individual product is
long and uncertain. The products currently under development by us will require
significant additional research and development and extensive pre-clinical and
clinical testing prior to application for commercial use. A number of companies
in the biotechnology and pharmaceutical industries have suffered significant
setbacks in clinical trials, even after showing promising results in early or
later stage studies or clinical trials. Although we have obtained some favorable
results to date in pre-clinical studies and clinical trials of certain of our
potential products, such results may not be indicative of results that will
ultimately be obtained in or throughout such clinical trials, and clinical
trials may not show any of our products to be safe or capable of producing a
desired result. Additionally, we may encounter problems in our clinical trials
that will cause us to delay, suspend or terminate those clinical trials.

We Are Subject To Extensive Regulation Which Can Be Costly And Time Consuming
And Subject Us To Unanticipated Delays

All of our potential products and manufacturing activities are subject to
comprehensive regulation by the Food and Drug Administration (FDA) in the United
States and by comparable authorities in other countries. The process of
obtaining FDA and other required regulatory approvals, including foreign
approvals, is expensive and often takes many years and can vary substantially
based upon the type, complexity and novelty of the products involved.
Preclinical studies involve laboratory evaluation of product characteristics and
often animal studies to assess the efficacy and safety of the product. The FDA
regulates preclinical studies under a series of regulations called the current
Good Laboratory Practices regulations. If the sponsor violates these
regulations, the FDA, in some cases, may invalidate the studies and require that
the sponsor replicate them. Certain of our potential products may be novel, and
regulatory agencies may lack experience with them, which may lengthen the
regulatory review process, increase our development costs and delay or prevent
their commercialization. There is limited successful commercialization of
products based on technology such as ours. In addition, we have had only limited
experience in filing and pursuing applications necessary to gain regulatory
approvals, which may impede our ability to obtain timely FDA approvals, if at
all. We will not be able to commercialize any of our potential therapeutic
products until we obtain FDA approval, and so any delay in obtaining, or
inability to obtain, FDA approval could harm our business. We have not yet
sought FDA approval for any of our therapeutic products.

We Are Dependent on Georgetown University To Conduct Research And
Development And To Conduct Preclinical Studies, Which If Unavailable Would
Impair Our Ability To Commercialize Our Products

Our potential therapeutic products are not the result of our own internal basic
research but rather arise from our ability to license technologies from
Georgetown University. We are also dependent upon Georgetown University for all
preclinical studies. There can be no assurance that we will be able to obtain
these services from Georgetown University, or other third parties, on
commercially reasonably terms or at all, or that any or all of the contemplated
benefits from such collaborative arrangements will be realized. Failure to
obtain such arrangements would result in delays in the development of our
proposed products.

Technology With Respect To Therapeutics And Other Biopharmaceutical Fields Is
Rapidly Evolving, And There Can Be No Assurance Of Our Ability To Respond
Adequately

We are engaged in biopharmaceutical fields characterized by extensive research
efforts, rapidly evolving technology and intense competition from numerous
organizations, including pharmaceutical companies, biotechnology firms, academic
institutions and others. New developments are expected to continue at a rapid
pace in both industry and academia. We cannot assure you that research and
discoveries by others will not render any of our potential products obsolete,
uneconomical or otherwise unmarketable or unprofitable. In order to compete
successfully, we will need to complete the development of and obtain regulatory
approval of one or more of our products that keep pace with technological
developments on a timely basis. Any failure by us to anticipate or respond
adequately to technological developments will have a material adverse effect
upon our prospects and financial condition.

Competition In Our Industry Is Intense And Many Of Our Competitors Have
Substantially Greater Managerial Resources Than We Have

Competition in our fields of research is intense and is accentuated by the rapid
pace of technological development, although we do not have access to information
regarding the product development efforts of our competitors or the diseases
that such efforts target. Many of our competitors have substantially greater
research and development capabilities and manufacturing, marketing, financial
and managerial resources than we do. Research and discoveries by others may
result in breakthroughs which may render our products obsolete even before they
generate any revenue. There are products currently under development by others
that could compete with the products that we are developing. Competitors also
may succeed in developing and marketing products that are more effective than or
marketed before our products. Our competitors may develop safer or more
effective therapeutic products, reach the market more rapidly and thereby reduce
the potential sales of our products, or establish superior proprietary
positions. We also anticipate that we will face increased competition in the
future as new companies enter our markets and as scientific developments
continue to accelerate. If any of our products receive marketing approval, the
inability of our products to compete effectively in the marketplace will
materially and adversely affect our business operations.

We Are Dependent Of Key Members Of Management

Our success is dependent upon the continued services and performance of Dr.
Janet Greeson, our chief executive officer; president and chairman; and Dr.
Vassilios Papadopoulos, our chief scientific officer. We do not maintain key man
insurance on either officer. We have a 5 year employment agreement with Dr.
Greeson that expires in 2006. The loss of their services could delay our product
development programs and our research and development efforts at Georgetown
University. In addition, the loss of Dr. Janet Greeson may result in the loss of
the Georgetown University Collaboration. In addition, competition for qualified
employees among companies in the biotechnology and biopharmaceutical industry is
intense and we cannot assure you that we would be able to recruit qualified
personnel on acceptable terms to replace them.

We May Not Be Able To Adequately Protect Our Intellectual Proprietary Rights

Our patent strategy is to pursue patent protection in the U.S. and in major
developed countries for our technologies. As of the date hereof, we owned or
licensed one issued U.S. patent and had eight pending patent applications in the
U.S. to protect our proprietary methods and processes. We have also filed
corresponding foreign patent applications for certain of these U.S. patent
applications. As of the date here, our patent portfolio outside the U.S.
comprised of no issued patents and over eight pending patent applications. The
issued U.S. patent and pending patent application relate to Alzheimer's, Cancer,
Cardiovascular, and HIV indications and is based on balancing and modulating the
stress hormone cortisol, counteracting cortisol's neurodegenerative and
immunosuppressive properties. Our goal is to obtain broad patent protection for
our technologies and their related medical indications. The patent on PROCAINE
issued on September 1990, expires in September 2008 but patent term extensions
under the Hatch-Waxman Act may be available to Samaritan for the lost
opportunity to market and sell the invention during the regulatory review
process.

Our success will depend in significant part on our ability to obtain and
maintain elements of business protection practices, including but not limited to
U.S. patent protection for our licensed technologies, preservation and defense
of our trade secrets and proprietary rights, and operations that do not infringe
upon the proprietary rights of third parties. Because of the length of time and
expense associated with bringing new products through development and regulatory
approval to the marketplace, the pharmaceutical industry has traditionally
placed considerable importance on obtaining patent and trade secret protection
for significant new technologies, products and processes. We can't assure you
that patents will be issued from the patent applications we own, or have
licensed or that the patent issued to us will provide us with significant
protection against competitive applications or otherwise be commercially
valuable. In addition, patent law relating to certain of our fields of interest,
particularly as to the scope of claims in issued patents, is still evolving.
Patent positions may not be as strong as in other more well-established fields,
and it is unclear how this uncertainty will affect our patent rights.
Litigation, which could be costly and time consuming, may be necessary to
enforce any patents issued in the future to us or our licensors or to determine
the scope and validity of the proprietary rights of third parties. The issuance
of a patent is not conclusive as to its validity or enforceability and it is
uncertain how much protection, if any, will be given to our patents if we
attempt to enforce them and they are challenged in court or in other
proceedings, such as oppositions, which may be brought in foreign jurisdictions
to challenge the validity of a patent. A third party may challenge the validity
or enforceability of a patent after its issuance by the U.S. Patent and
Trademark Office. It is possible that a competitor may successfully challenge
our patents or that a challenge will result in limiting their coverage.
Moreover, the cost of litigation to uphold the validity of patents and to
prevent infringement can be substantial. If the outcome of litigation is adverse
to us, third parties may be able to use our patented invention without payment
to us. Moreover, it is possible that competitors may infringe our patents or
successfully avoid them through design innovation. To stop these activities we
may need to file a lawsuit. These lawsuits are expensive and would consume time
and other resources, even if we were successful in stopping the violation of our
patent rights. In addition, there is a risk that a court would decide that our
patents are not valid and that we do not have the right to stop the other party
from using the inventions. There is also the risk that, even if the validity of
our patents were upheld, a court would refuse to stop the other party on the
ground that its activities are not covered by, that is, do not infringe, our
patents. Our competitive position is also dependent upon unpatented technology
and trade secrets which may be difficult to protect. We can't assure you that
others will not independently develop substantially equivalent proprietary
information and techniques which would legally circumvent our intellectual
property rights, that our trade secrets will not be disclosed or that we can
effectively protect our rights to unpatented trade secrets. As the biotechnology
industry expands and more patents are issued, the risk increases that our
potential products may give rise to claims that they infringe upon the patents
of others. Any such infringement litigation would be costly and time consuming
to us. As of the date hereof, Samaritan has no pending threats of litigation or
negotiations regarding patent issues, court challenges, or legal action.

We Are Exposed To Potential Liability Claims, And Our Insurance Against These
Claims May Not Be Sufficient To Protect Us

Our business exposes us to potential clinical trial and may in the future expose
us to product liability risks, which are inherent in the testing, manufacturing,
marketing and sale of pharmaceutical products. Although we carry a $2,000,000
commercial general liability insurance policy, the company currently has no
specific clinical trial liability or product liability insurance. There can be
no assurance that the coverage the commercial general liability insurance policy
provides will be adequate to satisfy all claims that may arise. Regardless of
merit or eventual outcome, such claims may result in decreased demand for a
product, injury to our reputation, withdrawal of clinical trial volunteers and
loss of revenues. Thus, a clinical trial or product liability claim may result
in losses that could be material.

We Have Only One Source Of Supply For SP001 and its bioequivalent HIV Drugs

We are currently dependent on one source of supply for SP001 and its
bioequivalent HIV drugs, the University of Iowa, and there would be a material
adverse effect on our business and prospects if we were unable to obtain
adequate supplies. University of Iowa manufactures the material in a facility
which adheres to current Good Manufacturing Practices, or cGMP, regulations
enforced by the FDA through its facilities inspection program. If our supplier
was unable to produce and provide us with SP001 and its bioequivalent HIV
product, especially of cGMP grade, we will be forced to identify an alternative
supplier or produce the product ourselves. In the case of the former, we
currently do not have an alternative supplier capable of meeting our needs and
might experience delays in replacing our supplier. We would be required to
design, in addition, if the suppliers produce an inadequate supply, or fail to
produce or deliver the product on a timely basis; our clinical testing may be
delayed, thereby delaying the submission of products for regulatory approval or
the market introduction and subsequent sales of our products. Any such delay may
lower our revenues and potential profitability and otherwise have a material
adverse effect on us.

Risks Related To Our Common Stock And To The Offering

The Sale Of Our Common Stock To Fusion Capital May Cause Dilution And The Sale
Of The Shares Of Common Stock Acquired By Fusion Capital Could Cause The Price
Of Our Common Stock To Decline

The purchase price for the common stock to be issued to Fusion Capital pursuant
to the common stock purchase agreement will fluctuate based on the price of our
common stock. All shares in this offering are freely tradable. Fusion Capital
may sell none, some or all of the shares of common stock purchased from us at
any time. We expect that the shares offered by this prospectus will be sold over
a period of up to 25 months from the date of this prospectus. Depending upon
market liquidity at the time, a sale of shares under this offering at any given
time could cause the trading price of our common stock to decline and to be
highly volatile. Fusion Capital may ultimately purchase all of the shares of
common stock issuable under the common stock purchase agreement, and it may sell
some, none or all of the shares of common stock it acquires upon purchase.
Therefore, the purchases under the common stock purchase agreement may result in
substantial dilution to the interests of other holders of our common stock. The
sale of a substantial number of shares of our common stock under this offering,
or anticipation of such sales, could make it more difficult for us to sell
equity or equity-related securities in the future at a time and at a price that
we might otherwise wish to effect sales.

Future Sales Of Common Stock Could Depress The Price Of Our Common Stock

Future sales of substantial amounts of common stock pursuant to Rule 144 under
the Securities Act of 1933 or otherwise by certain shareholders could have a
material adverse impact on the market price for the common stock at the time.
There are presently approximately 54,349,354 outstanding shares of our common
stock held by shareholders which are deemed "restricted securities" as defined
by Rule 144 under the Securities Act. Under certain circumstances, these shares
may be sold without registration pursuant to the provisions of rule 144. In
general, under rule 144, a person (or persons whose shares are aggregated) who
has satisfied a one-year holding period may, under certain circumstances, sell
within any three-month period a number of restricted securities which does not
exceed the greater of one (1%) percent of the shares outstanding or the average
weekly trading volume during the four calendar weeks preceding the notice of
sale required by rule 144. In addition, rule 144 permits, under certain
circumstances, the sale of restricted securities without any quantity
limitations by a person who is not an affiliate of ours and has satisfied a
two-year holding period. Any sales of shares by shareholders pursuant to rule
144 may have a depressive effect on the price of our common stock.

The Market Price Of Our Common Stock Is Very Volatile And The Value Of Your
Investment May Be Subject To Sudden Decreases

The trading price for our common stock has been, and we expect it to continue to
be, volatile. For example, the closing bid price of our stock has fluctuated
between $0.11 and $0.75 per share since January 1, 2001. The price at which our
common stock trades depends upon a number of factors, including our historical
and anticipated operating results and general market and economic conditions,
which are beyond our control. Factors such as fluctuations in our financial and
operating results, the results of preclinical and clinical trials, announcements
of technological innovations or new commercial products by us or our
competitors, developments concerning proprietary rights and publicity regarding
actual or potential performance of products under development by us or our
competitors could also cause the market price of our common stock to fluctuate
substantially. In addition, the stock market has, from time to time, experienced
extreme price and volume fluctuations. These broad market fluctuations may lower
the market price of our common stock. Moreover, during periods of stock market
price volatility, share prices of many biotechnology companies have often
fluctuated in a manner not necessarily related to their operating performance.
Accordingly, our common stock may be subject to greater price volatility than
the stock market as a whole.

Our Common Stock Is Traded Over The Counter, Which May Deprive Stockholders Of
The Full Value Of Their Shares

Our common stock is quoted via the Over The Counter Bulletin Board (OTCBB). As
such, our common stock may have fewer market makers, lower trading volumes and
larger spreads between bid and asked prices than securities listed on an
exchange such as the New York Stock Exchange or the NASDAQ. These factors may
result in higher price volatility and less market liquidity for the common
stock.

A Low Market Price May Severely Limit The Potential Market For Our Common Stock

Our common stock is currently trading at a price substantially below $5.00 per
share, subjecting trading in the stock to certain SEC rules requiring additional
disclosures by broker-dealers. These rules generally apply to any non-NASDAQ
equity security that has a market price of less than $5.00 per share, subject to
certain exceptions (a "penny stock"). Such rules require the delivery, prior to
any penny stock transaction, of a disclosure schedule explaining the penny stock
market and the risks associated therewith and impose various sales practice
requirements on broker-dealers who sell penny stocks to persons other than
established customers and institutional or wealthy investors. For these types of
transactions, the broker-dealer must make a special suitability determination
for the purchaser and have received the purchaser's written consent to the
transaction prior to the sale. The broker-dealer also must disclose the
commissions payable to the broker-dealer, current bid and offer quotations for
the penny stock and, if the broker-dealer is the sole market maker, the
broker-dealer must disclose this fact and the broker-dealer's presumed control
over the market. Such information must be provided to the customer orally or in
writing before or with the written confirmation of trade sent to the customer.
Monthly statements must be sent disclosing recent price information for the
penny stock held in the account and information on the limited market in penny
stocks. The additional burdens imposed upon broker-dealers by such requirements
could discourage broker-dealers from effecting transactions in our common stock.

Because We Will Not Pay Dividends, Stockholders Will Only Benefit From Owning
Common Stock If It Appreciates

We have never paid dividends on our common stock and do not intend to do so in
the foreseeable future. We intend to retain any future earnings to finance our
growth. Accordingly, any potential investor who anticipates the need for current
dividends from his investment should not purchase our common stock.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This prospectus contains forward-looking statements within the meaning of the
"safe harbor" provisions of the Private Securities Litigation Reform Act of
1995. Such statements are based upon management's current expectations that are
subject to a number of factors and uncertainties that could cause actual results
to differ materially from those described in our forward-looking statements.
Such statements address the following subjects: our need for and ability to
obtain additional capital, including from the sale of equity and/or from federal
or other grant sources; our expected future losses; the sufficiency of cash and
cash equivalents; our ability to generate revenues; our ability to develop
commercially successful products, including our ability to obtain FDA approval
to initiate further studies of our potential products and our technologies; the
high cost and uncertainty of the research and development of pharmaceutical
products; the unpredictability of the duration and results of the U.S. Food and
Drug Administration's review of new drug applications; the possible impairment
of our existing, and the inability to obtain new, intellectual property rights
and the cost of protecting such rights as well as the cost of obtaining rights
from third parties when needed on acceptable terms; our ability to enter into
successful partnering relationships with respect to the development and/or
commercialization of our product candidates; our dependence on third parties to
research, develop, manufacture and commercialize and sell any products
developed; our ability to improve awareness and understanding of our company,
our technology and our business objectives; whether our predictions about market
size and market acceptability of our products will prove true; and our
understandings and predictions regarding the utility of our potential products
and our technology.

Statements in this report expressing our expectations and beliefs regarding our
future results or performance are forward-looking statements that involve a
number of substantial risks and uncertainties. When used in this prospectus the
words "anticipate," "believe," "estimate," "expect," "intend," may be," "seek,"
"plan," "focus," and "potential" and similar expressions as they relate to the
Company or its management are intended to identify such forward-looking
statements. Our actual future results may differ significantly from those stated
in any forward-looking statements.

USE OF PROCEEDS

This prospectus relates to shares of our common stock that may be offered and
sold from time to time by Fusion Capital. We will receive no proceeds from the
sale of shares of common stock in this offering. However, we may receive up to
$10.0 million in proceeds from the sale of our common stock to Fusion Capital
under the common stock purchase agreement. Any proceeds from Fusion Capital we
receive under the common stock purchase agreement will be used for research and
development, working capital and general corporate purposes.

MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

Market Information

Our common stock is traded on the NASDAQ over-the-counter ("OTC") Bulletin Board
under the symbol "SPHC.OB" and the name of Samaritan Pharmaceuticals, Inc. On
July 28, 2003, the last reported sale price for our common stock as reported on
the NASDAQ Over-The-Counter Bulletin Board was $0.21 per share. The following
table sets forth (a) the range of high and low bid closing quotations for our
common stock on the over-the-counter market for each quarter within the last two
fiscal years. The over-the-counter quotes reflect inter-dealer prices without
retail mark-up, mark-down or commission and may not represent actual
transactions. The quotations may be rounded for presentation.

Bid Prices
Period Low High

For the period July 1, 2003 through
July 28, 2003 0.20 0.24
Quarter Ended June 30, 2003 0.15 0.24
Quarter Ended March 31, 2003 0.12 0.18

Quarter Ended December 31, 2002 0.15 0.24
Quarter Ended September 30, 2002 0.15 0.30
Quarter Ended June 30, 2002 0.13 0.20
Quarter Ended March 31, 2002 0.14 0.30

Quarter Ended December 31, 2001 0.11 0.15
Quarter Ended September 30, 2001 0.14 0.27
Quarter Ended June 30, 2001 0.20 0.40
Quarter Ended March 31, 2001 0.44 0.75

Holders

As of December 31, 2002 there were approximately seven hundred fifty-two (752)
holders of record of our common stock. Certain of the shares of common stock are
held in "street" name and may, therefore, be held by numerous beneficial owners.

Dividends

We have never paid a cash dividend on our common stock. The payment of dividends
may be made at the discretion of our board of directors and will depend upon,
among other things, our operations, capital requirements, and overall financial
condition.

Equity Compensation Plan Information

Number of securities Weighted average Number of
to be issued upon exercise price of securities
exercise of outstanding remaining
outstanding options options, warrants for future
Name of Plan warrants, and rights and rights issuance
----------------------------- --------------------- ------------------ --------------

Equity compensation
Plans approved
By security holders (1) 5,074,858 $0.16 2,586,192
Equity compensation
Plans not approved
By security holders (2) 3,094,350 $0.24 ----
---------------------------------------

(1) Samaritan Pharmaceuticals, Inc. 2001 Stock Incentive Plan.
(2) Employment agreements between Samaritan Pharmaceuticals, Inc., Doug
Bessert, Eugene Boyle and Dr. Janet Greeson.

Trust Agreements

We have entered into trust agreements with institutional trustees providing for
the payment out of the assets of the trusts of benefits accrued under our
various benefit plans, employment agreements and other employment arrangements
as we specify from time to time. To the extent not already irrevocable, the
trusts would become irrevocable upon a change of control of Samaritan
Pharmaceuticals. We may make contributions to the trusts from time to time, and
additional funding could be required upon a change of control. To the extent
funded, the trusts are to be used, subject to their terms and to the claims of
our general creditors in specified circumstances, to make payments under the
terms of the benefit plans, employment agreements and other employment
arrangements from time to time specified by us.

PLAN OF OPERATION

The following discussion should be read together with our financial statements
and the notes related to those statements, as well as the other financial
information included in this prospectus. Some of our discussion is
forward-looking and involves risks and uncertainties. For information regarding
risk factors that could have a material adverse effect on our business, refer to
the Risk Factors section of this prospectus.

Overview

Samaritan was formed in September 1994 and became public in October 1997. Our
principal executive offices are located at 101 Convention Center Drive, Suite
310, Las Vegas, NV 89109, and our telephone number is (702) 735-7001.

Our overall corporate strategy is to build a robust technology pipeline by (1)
in-licensing early-stage patented technologies from Academic Research Centers,
and (2) focus on the discovery and the development of new drug compounds and
technology to add to our pipeline at Samaritan Laboratories, in collaboration
with Georgetown University.

Business Model

Our business model is primarily focused on the commercialization of our product
pipeline and patent portfolio. We seek potential products, mainly from the
Georgetown-Samaritan collaboration, and then focus on the continual development
of these products. Our first development objective for a potential drug
candidate is to file for an Investigational New Drug (IND) application, to
conduct human clinical trials, with the eventual goal of obtaining marketing
approval for each of the selected technologies.

We currently have several technologies in our product pipeline: requesting an
End of Phase II Meeting with the FDA for SP001 and its bioequivalents clinical
trial with positive data; an animal (rat) model for Alzheimer's disease; Novel
Neuroprotective compounds; a Peptide to bind cholesterol; an Alzheimer's and
Breast Cancer Diagnostic/Theranostic; and a series of novel compounds.

Business Value

What separates Samaritan and the promise of Samaritan is predicated on
generating the best value through the development of true medical advances based
on the insights, intuition and creativity of its scientists at Samaritan
Research Laboratories, Georgetown University Medical Center.

Samaritan believes its collaboration fosters scientific creativity and will
advance drug leads more rapidly, thereby, decreasing the average travel time
from lab to patients. Currently, the average drug discovery and preclinical
testing time is six and a half years, with Phase I being one and a half years
and Phase II averaging two years. Samaritan believes it can drastically reduce
the average time to commercialization and produce attractive later-stage
licensing opportunities.

Samaritan plans to license its drug candidate's late stage, after the technology
is validated with "proof of concept" science, thereby capturing the greater
portion of the potential value of its drug candidates. The closer the technology
is to "proof of concept" FDA Phase I and II, corporate marketing and/or
development partnerships are sought, in a manner that strategically fits with
the Company's overall goal of building shareholder value. In certain disease
categories, Samaritan may process its drug candidates through all human clinical
trials.

Our Financial Position And Our Need To Raise Additional Capital

We are a biopharmaceutical company in a research and development stage. Since
our inception, we have primarily focused our resources on research and
development. To date, none of our proprietary products have reached a commercial
stage, and hence, we do not have, nor do we anticipate revenue in the near
future. We have been unprofitable since our inception and have incurred
significant losses. Our net losses since inception on September 5, 1994 to March
31, 2003 were $18.4 million. We had net losses of $4.0 million in each of the
last two years ended December 31, 2002 and a net loss of $600,000 in the three
months ended March 31, 2003. We will continue to have significant general and
administrative expenses, including expenses related to clinical studies, our
collaboration with Georgetown University, and patent prosecution. We have funded
our operations through a series of private placements and through our previous
agreement dated November 2, 2000 with Fusion Capital. We believe potential
private placements, the new agreement with Fusion Capital dated April 22, 2003,
described below will assist the Company in meetings its cash needs, but there is
no guarantee. Except for an agreement to sell shares to Fusion Capital,
discussed below, no commitment exists for continued investments, or for any
underwriting.

We have the right to receive $20,000 per trading day under the agreement with
Fusion Capital unless our stock price equals or exceeds $0.45, in which case the
daily amount may be increased at our option. Generally, Fusion Capital shall not
be obligated to purchase any shares of our common stock on any trading days that
the market price of our common stock is less than $0.10. Since we initially
registered 15,000,000 shares for sale by Fusion Capital pursuant to this
prospectus (excluding the total of 3,125,000 shares issuable to Fusion Capital
as a commitment fee), the selling price of our common stock to Fusion Capital
will have to average at least $0.67 per share for us to receive the maximum
proceeds of $10.0 million without registering additional shares of common stock.
Assuming a purchase price of $0.22 per share (the closing sale price of the
common stock on July 24, 2003) and the purchase by Fusion Capital of the full
15,000,000 shares under the common stock purchase agreement, proceeds to us
would be $3,300,000.

Even with our financing arrangement with Fusion Capital, we may require
substantial additional funds to sustain our operations and to grow our business.
The amount of which will depend, among other things, on the rate of progress and
the cost of our research and product development programs and clinical trial
activities, the cost of preparing, filing, prosecuting, maintaining and
enforcing patent claims and other intellectual property rights, and the cost of
developing manufacturing and marketing capabilities, if we decide to undertake
those activities. The clinical development of a therapeutic product is a very
expensive and lengthy process and may be expected to utilize $5 to $20 million
over a three to six year development cycle. We currently do not have available
the financial resources to complete the clinical development of any of our
therapeutic products without a strategic partner. Although we believe we could
license the manufacturing and marketing rights to our products in return for
up-front licensing and other fees and royalties on any sales, there can be no
assurance that we will be able to do so in the event we seek to do so. We need
to obtain additional funds to develop our therapeutics products and our future
access to capital is uncertain. The allocation of limited resources is an
ongoing issue for us as we move from research activities into the more costly
clinical investigations required to bring therapeutic products to market.

We have been able to substantially meet our cash needs during the past 12
months. We believe we will be able to continue to find avenues to obtain the
capital needed for our operations through private placements and by sale of our
shares to Fusion Capital.

Summary Of Research And Development

We have a series of therapeutic projects either in "discovery research"",
preclinical trials"", product development" or "clinical development"; and we
utilize these formal stages of product progression to track progress,
performance, competition, and cost for each project. Our research programs are
aimed at satisfying defined medical needs in the areas of Alzheimer's, Cancer,
Cardiovascular, Infectious Diseases, and Neurology and are based on an
intellectual property position that, we believe, is both broad and strong.
Several of our development programs involve ex vivo technologies in which
patients' tissues are manipulated outside the body and, as such, may be less
costly to investigate and quicker to develop than in vivo agents. We expect to
apply to the U.S. FDA for and receive IND status (Investigational New Drug) for
certain technologies to initiate human trials that may commence in the future.
We have concentrated our efforts on Samaritan Research Laboratories, our
research collaboration with Georgetown University, setting up the operations,
increasing efficiencies, and streamlining structure. We have an impressive
portfolio of technology and opportunities, each of which must compete for
resources and priority status.

A key currency in the biotechnology and pharmaceutical market is patents,
intellectual property. Our central intellectual property activity has been, and
continues to be, the acquisition of patents, development and patent maintenance,
directly in support of our product development. We continue to expend
significant funds and efforts on licensed technology and patent protection. In
addition, we are continually examining our intellectual property positions in
relation to competitive activities and our ability to operate and defend our
patent positions in relation to products. We believe that this is a key value
element for our continued development.

Research Agreement

On June 8, 2001, Samaritan Pharmaceuticals signed a seven-year research
collaboration with Georgetown University. The objectives of the Georgetown
University Samaritan Pharmaceuticals research collaboration are (1) to develop
"one molecule" drugs and extend clinical studies to in vivo experiments in
animal models simulating Alzheimer's disease, (2) to develop an accurate,
reliable diagnostic for nuero-degeneration (Alzheimer's), and (3) to focus on
new drug development in Oncology and Neurology with the ability to protect the
brain from neuronal damage and tumor growth.

Under the agreement, Samaritan receives worldwide exclusive rights to any novel
therapeutic agents or diagnostic technologies that may result from the research
collaboration directed by Dr. Vassilios Papadopoulos with his team of seven
research professionals (including five Ph.D. level research scientists) who have
expertise in the fields of endocrinology, pharmacology, cell biology, organic
and steroid chemistry and computer modeling.

Dr. Papadopoulos is the Head of the Division of Hormone Research and a Professor
at the Department of Cell Biology, Pharmacology and Neurosciences at Georgetown
University Medical Center. He has authored over 150 scientific publications in
the field of steroid hormone production and presented his work at numerous
national and international meetings.

Highlights Of The Main Products Or Technologies Closest To Or Ready For
Out-Licensing Or Commercialization

SP001 and its bioequivalent HIV drugs with promising Phase II
results -- Early data suggest no serious side effects and
(CD4) immune system improvement. The analysis of data is
presently being prepared for FDA submission.

A Pharmacological (rat) model for Alzheimer's disease -- Four
weeks treatment of a rat results in its loss of memory and
Alzheimer's disease-like brain pathology. This model is ideal
for pharmaceutical companies and scientists to screen their
Alzheimer's drugs for prevention, stabilization of the disease
and cures for Alzheimer's disease.

Alzheimer's disease compounds -- Compounds offer protection
against beta-amyloid neurotoxicity, a condition associated
with Alzheimer's disease.

A peptide therapeutic that binds cholesterol -- Peptide can be
used to clean the blood of excessive cholesterol in acute high
cholesterol conditions.

An Alzheimer's diagnostic kit -- A simple blood test that
identifies specific circulating brain steroids that have been
oxidized in the brains of Alzheimer's patients.

A breast cancer theranostic kit. -- A biopsy test that
predicts the aggressiveness of a breast cancer tumor which
allows a physician, in a timely manner, to recommend the best
and possibly the least invasive treatment for a patient.

Promising Alzheimer's Drug Candidates

Background for Alzheimer's thesis: Cortisol, the stress hormone, is the main
hormone associated with immunity, memorization and learning with excessive
cortisol being well known to produce cognitive impairment.

Why do we care: It is estimated that 16 million Americans will be diagnosed with
Alzheimer's by 2050. Early diagnosis and treatment with Cortisol modulating
drugs before the onset of symptoms could possibly lengthen the progression of
Alzheimer's whereas a patient might die of natural causes rather than
Alzheimer's.

Promising Alzheimer's Drug Candidates:
-- SP001
-- SP010
-- SP222
-- SP223
-- SP232
-- SP238

Alzheimer's Related Patent Application Titles:
-- Neuroprotective spirostenol pharmaceutical compositions.
-- Methods and compositions for modulating serum cortisol
levels.

Journals:
-- Journal of Neurochemistry, 2002, 83:1110-1119 -- Endocrine
Society 2003, abstract.

Stem Cell Therapy for Alzheimer's, Neuron Differentiation

Background: Stem cell therapy, the manipulation of stem cells to combat disease,
is on the threshold of a new era in medicine. Neuronal stem cells can be induced
to rapidly differentiate to adult neuron cells as a novel treatment for
Alzheimer's.

Promising Stem Cell Drug Candidates:
-- SP222b
-- SP237

New Alzheimer's Pharmacologic (Rat) Model Tool:
Brand New Tool-Used by pharmaceuticals companies to test their preventive,
stabilizing or curative therapies under development for Alzheimer's. Advantage:
Pharmacologic. Only four weeks to induce full blown Alzheimer's disease
compared to lengthy transgenics.

Alzheimer's Predictive Diagnostic:

Advantage: Simple blood test with 70% success rate.

Patent Title:
-- Neurosteroids: Markers of Alzheimer's disease pathology

Journals:
-- Neurobiology of Aging, 2003, 24:57-65.

AIDS Related Dementia Research and Drug Candidates

Background: Elevated cortisol levels are associated with many disease states of
which AIDS Related Dementia is included. SP001 has proven to be a safe and
effective cortisol modulator; therefore, SP001 and its bioequivalents could
change the way patients are treated, either as a single agent or in combination
with other conventional therapies for AIDS.

Promising AIDS and Related Dementia Drug Candidates:
-- SP001
-- SP010
-- SP014
-- SP016
-- SP017

Patent and Patent Application Titles:
-- Protected Complex of Procaine...
-- Composition of Anti-HIV Drugs and Anticortisol Compounds...
-- Methods and Compositions for Modulating Serum Cortisol
Levels...

Proof of Concept HIV FDA Phase II Study Results
-- Safe, Tolerable, CD8 improvement, Cortisol modulation.
-- Statistically Significant
1. Decreased HIV symptoms (Whalen Scale-Quality of
Life)
2. Decreased viral load.
-- Orphan drug status requested

BUSINESS

Overview

Competition

The biotechnology and biopharmaceutical industries are characterized by rapidly
advancing technologies, intense competition and a strong emphasis on proprietary
products. Many entities, including pharmaceutical and biotechnology companies,
academic institutions and other research organizations are actively engaged in
the discovery and research and development of products that could compete
directly with our products under development, although we do not have access to
information regarding the product development efforts of our competitors or the
diseases that such efforts target.

Many companies, including major pharmaceutical companies, are also developing
alternative therapies that may compete with our products in our research fields.
These competitors may succeed in developing and marketing products that are more
effective than or marketed before ours.

Virtually all of our competitors have significantly greater financial resources
and expertise in research and development, manufacturing, preclinical testing,
conducting clinical trials, obtaining regulatory approvals and marketing. Others
have partnered with large established companies in order to obtain access to
these resources. Smaller companies may also prove to be significant competitors,
particularly through the establishment of collaborative arrangements with large,
established companies.

Our ability to commercialize our products and compete effectively will depend,
in large part, on:

-- Our success in discovering and developing innovative products that
serve unmet medical needs that are cost effective;

-- Our ability to advance through clinical trials, gain acceptance
from the FDA and other regulatory agencies and to successfully
manufacture and market these products;

-- The margins of our products relative to other products or competing
treatments;

-- The ability to gain reimbursement status from appropriate
government agencies, insurers and other third-parties;

-- The effectiveness of our sales and marketing efforts and those of
our partners;

-- The perception by physicians and other members of the health care
community of the safety, efficacy and benefits of our products
compared to those of competing products or therapies;

-- Favorable publicity directly or indirectly relating to our products
and technology.

Competition among products approved for sale will be based, among other things,
upon efficacy, reliability, product safety, price and patent position. Our
competitiveness will also depend on our ability to advance our technologies,
license additional technology, maintain a proprietary position in our
technologies and products, obtain required government and other public and
private approvals on a timely basis, attract and retain key personnel and enter
into corporate partnerships that enable us and our collaborators to develop
effective products that can be manufactured cost-effectively and marketed
successfully.

If competitors introduce new products and processes with therapeutic or cost
advantages, our products can be subject to progressive price reductions or
decreased volume of sales, or both. When we introduce new products with patent
protection, they usually must compete with other products already on the market
or products that are later developed by competitors. Manufacturers of generic
products typically invest far less in research and development than
research-based pharmaceutical companies; accordingly, they are able to price
their products significantly lower than branded products. Therefore, when a
branded product loses its market exclusivity, it often faces intense price
competition from generic forms of the product. In many countries outside the
United States, patent protection is weak or nonexistent. In order for us to
successfully compete for business with managed care and pharmacy benefits
management organizations, we must demonstrate that our products offer not only
medical benefits but also cost advantages as compared with other forms of care.
There also is no assurance that our research and development efforts will result
in commercially successful products or that our products or processes will not
become outmoded from time to time as a result of products or processes developed
by our competitors.

Research Agreement

On June 8, 2001, Samaritan Pharmaceuticals signed a seven-year research
collaboration agreement with Georgetown University. The objectives of the
Georgetown University Samaritan Pharmaceuticals research collaboration are (1)
to develop "one molecule" drugs and extend clinical studies to in vivo
experiments in animal models simulating Alzheimer's disease, (2) to develop an
accurate, reliable diagnostic for nuero-degeneration (Alzheimer's), and (3) to
focus on new drug development in Oncology and Neurology with the ability to
protect the brain from neuronal damage and tumor growth.

License Agreements

On June 18, 2001, Georgetown University granted Samaritan an Exclusive Worldwide
License to Georgetown's patent application for "Early Detection of Alzheimer's."
Georgetown's research efforts toward this patent application accumulated over a
seven-year period. The patent application, entitled, "Neurosteroids as Markers
for Alzheimer's Disease", naming inventors Vassilios Papadopoulos, Rachel C.
Brown and Caterina Cascio, is believed to detect early damage resulting from
Alzheimer's. Their findings, that brain levels of DHEA, are increased in
Alzheimer's pathology; have significant relevance, given the fact that many
companies are currently advocating increasing DHEA with supplements as a means
to prevent the development of Alzheimer's disease and, therefore, may put
prospective Alzheimer's patients at risk. The term of the license agreement is
for the term of the any associate patents. We are not obligated to pay
Georgetown any milestone payments. Georgetown is entitled to receive royalties
based on our revenue from product sales and sublicenses, if any. Samaritan has,
at its own expense, responsibility for the process of seeking any regulatory
approvals for and conducting clinical trials with respect to any licensed
product or application of the licensed technology. Samaritan controls and has
the financial responsibilities for the prosecution and maintenance In respect of
any patent rights related to the licensed technology. Samaritan has the right to
terminate the license upon written notice to Georgetown for any reason or for no
reason. In the event of that Samaritan fails to make any payment due to
Georgetown under the license, Georgetown has the right to terminate the license
upon sixty (60) days prior written notice if Samaritan fails to pay to
Georgetown such amount within such 60-day period.

On July 25, 2001, Georgetown University granted Samaritan an Exclusive Worldwide
License to Georgetown's patent application for a breast cancer diagnostic test
that can be used as a tool to improve the detection, diagnosis, prognosis,
prevention and possibly the treatment of breast cancer. The patent application,
entitled, "Peripheral-type Benzodiazepine Receptor: A Tool for Detection,
Diagnosis, Prognosis, and Treatment of Human Breast Cancer," naming as
inventors, Vassilios Papadopoulos and Martine Culty, identifies a protein named
Peripheral-type Benzodiazepine receptor (PBR) to be responsible for part of the
changes in cellular and molecular functions in the development and progression
of breast cancer. Although today there are methods for the detection of breast
tumors, such as a mammogram, little is known about the early prognosis of a
tumor to metastasize. Georgetown's scientists have identified a correlation
between high levels of PBR and the aggressiveness of a tumor. Biopsies,
considered to be safe procedures, would be used for PBR measurements and if the
levels are high, scientists believe it could serve as a marker for the
aggressiveness of a tumor with early detection, diagnosis and prognosis.
Georgetown's research efforts toward this patent application have accumulated
over an 8-year period and, in addition, Samaritan plans to explore research
seeking possible prevention technology and drugs to inhibit, block or arrest the
production of this protein PBR identified as a marker for breast cancer. The
term of the license agreement is for the term of the any associate patents. We
are not obligated to pay Georgetown any milestone payments. Georgetown is
entitled to receive royalties based on our revenue from product sales and
sublicenses, if any. Samaritan has, at its own expense, responsibility for the
process of seeking any regulatory approvals for and conducting clinical trials
with respect to any licensed product or application of the licensed technology.
Samaritan controls and has the financial responsibilities for the prosecution
and maintenance In respect of any patent rights related to the licensed
technology. Samaritan has the right to terminate the license upon written notice
to Georgetown for any reason or for no reason. In the event of that Samaritan
fails to make any payment due to Georgetown under the license, Georgetown has
the right to terminate the license upon sixty (60) days prior written notice if
Samaritan fails to pay to Georgetown such amount within such 60-day period.

On September 11, 2001, Georgetown University granted Samaritan an Exclusive
Worldwide License to Georgetown's patent application for "Cholesterol
Recognition Amino Acid Sequence." The invention has identified a "cholesterol
fingerprint" present in proteins known to interact with and bind cholesterol.
This chemically synthesized peptide, containing the "cholesterol fingerprint"
amino acid sequence, binds cholesterol and could be used as a drug to remove
cholesterol from other proteins, cells and tissues. The term of the license
agreement is for the term of the any associate patents. We are not obligated to
pay Georgetown any milestone payments. Georgetown is entitled to receive
royalties based on our revenue from product sales and sublicenses, if any.
Samaritan has, at its own expense, responsibility for the process of seeking any
regulatory approvals for and conducting clinical trials with respect to any
licensed product or application of the licensed technology. Samaritan controls
and has the financial responsibilities for the prosecution and maintenance In
respect of any patent rights related to the licensed technology. Samaritan has
the right to terminate the license upon written notice to Georgetown for any
reason or for no reason. In the event of that Samaritan fails to make any
payment due to Georgetown under the license, Georgetown has the right to
terminate the license upon sixty (60) days prior written notice if Samaritan
fails to pay to Georgetown such amount within such 60-day period.

On December 13, 2001, Georgetown University granted Samaritan an Exclusive
Worldwide License to Georgetown's patent application for "Peripheral-type
Benzodiazepine Receptor Associated Proteins: cloning, expression and methods of
use", naming as inventors, Vassilios Papadopoulos and Hua Li, identifies
proteins that are associated and regulate the function of the Peripheral-Type
Benzodiazepine Receptor in health and disease. The role of this receptor is in
cholesterol compartmentalization, steroid formation, cell death, tumor growth
and metastasis, Alzheimer's disease pathology, as well as in other brain
pathologies. It is hoped the discovery of these proteins, might provide new
tools to use for understanding the cause of diseases and develop new methods of
treatment. The term of the license agreement is for the term of the any
associate patents. We are not obligated to pay Georgetown any milestone
payments. Georgetown is entitled to receive royalties based on our revenue from
product sales and sublicenses, if any. Samaritan has, at its own expense,
responsibility for the process of seeking any regulatory approvals for and
conducting clinical trials with respect to any licensed product or application
of the licensed technology. Samaritan controls and has the financial
responsibilities for the prosecution and maintenance In respect of any patent
rights related to the licensed technology. Samaritan has the right to terminate
the license upon written notice to Georgetown for any reason or for no reason.
In the event of that Samaritan fails to make any payment due to Georgetown under
the license, Georgetown has the right to terminate the license upon sixty (60)
days prior written notice if Samaritan fails to pay to Georgetown such amount
within such 60-day period.

Government Regulation

Governmental authorities in the United States and other countries extensively
regulate the preclinical and clinical testing, manufacturing, labeling, storage,
record-keeping, advertising, promotion, export, marketing and distribution,
among other things, of our therapeutics products. In the United States, the FDA
under the Federal Food, Drug and Cosmetic Act, the Public Health Service Act and
other federal statutes and regulations subjects pharmaceutical products to
rigorous review. If we do not comply with applicable requirements, we may be
fined, our products may be recalled or seized, our production may be totally or
partially suspended, the government may refuse to approve our marketing
applications or allow us to distribute our products, and we may be criminally
prosecuted. The FDA also has the authority to revoke previously granted
marketing authorizations. In order to obtain approval of a new product from the
FDA, we must, among other requirements, submit proof of safety and efficacy as
well as detailed information on the manufacture and composition of the product.
In most cases, this proof entails extensive laboratory tests, and preclinical
and clinical trials. This testing, the preparation of necessary applications and
processing of those applications by the FDA are expensive and typically take
several years to complete. The FDA may not act quickly or favorably in reviewing
these applications, and we may encounter significant difficulties or costs in
our efforts to obtain FDA approvals that could delay or preclude us from
marketing any products we may develop. The FDA may also require post-marketing
testing and surveillance to monitor the effects of approved products or place
conditions on any approvals that could restrict the commercial applications of
these products. Regulatory authorities may withdraw product approvals if we fail
to comply with regulatory standards or if we encounter problems following
initial marketing. With respect to patented products or technologies, delays
imposed by the governmental approval process may materially reduce the period
during which we will have the exclusive right to exploit the products or
technologies.

After an IND becomes effective, a sponsor may commence human clinical trials.
The sponsor typically conducts human clinical trials in three sequential phases,
but the phases may overlap. In Phase I clinical trials, the product is tested in
a small number of patients or healthy volunteers, primarily for safety at one or
more doses. In Phase II, the sponsor continues to evaluate safety, but primarily
evaluates the efficacy of the product in a patient population. Phase III
clinical trials typically involve additional testing for safety and clinical
efficacy in an expanded population at geographically dispersed test sites. The
sponsor must submit to the FDA a clinical plan, or "protocol", accompanied by
the approval of the institution participating in the trials, prior to
commencement of each clinical trial. The FDA may order the temporary or
permanent discontinuation of a clinical trial at any time.

The sponsor must submit to the FDA the results of the preclinical and clinical
trials, together with, among other things, detailed information on the
manufacture and composition of the product, in the form of a new drug
application or, in the case of a biologic, a biologics license application. In a
process which generally takes several years, the FDA reviews this application
and, when and if it decides that adequate data is available to show that the new
compound is both safe and effective and that other applicable requirements have
been met, approves the drug or biologic for marketing.

The amount of time taken for this approval process is a function of a number of
variables, including the quality of the submission and studies presented the
potential contribution that the compound will make in improving the treatment of
the disease in question, and the workload at the FDA. It is possible that our
products will not successfully proceed through this approval process or that the
FDA will not approve them in any specific period of time, or at all.

Congress enacted the Food and Drug Administration Modernization Act of 1997, in
part, to ensure the availability of safe and effective drugs, biologics and
medical devices by expediting the FDA review process for new products. The
Modernization Act establishes a statutory program for the approval of fast track
products, including biologics. A fast track product is defined as a new drug or
biologic intended for the treatment of a serious or life-threatening condition
that demonstrates the potential to address unmet medical needs for this
condition. Under the fast track program, the sponsor of a new drug or biologic
may request the FDA to designate the drug or biologic as a fast track product at
anytime during the clinical development of the product. The Modernization Act
specifies that the FDA must determine if the product qualifies for fast track
designation within 60 days of receipt of the sponsor's request. The FDA can base
approval of a marketing application for a fast track product on an effect, on a
clinical endpoint or on another endpoint that is reasonably likely to predict
clinical benefit. The FDA may subject approval of an application for a fast
track product to post-approval studies to validate the surrogate endpoint or
confirm the effect on the clinical endpoint and prior review of all promotional
materials. In addition, the FDA may withdraw its approval of a fast track
product on a number of grounds, including the sponsor's failure to conduct any
required post-approval study with due diligence. If a preliminary review of
clinical data suggests that a fast track product may be effective, the FDA may
initiate review of sections of a marketing application for a fast track product
before the sponsor completes the application. This rolling review is available
if the applicant provides a schedule for submission of remaining information and
pays applicable user fees. However, the time periods specified under the
Prescription Drug User Fee Act concerning timing goals to which the FDA has
committed in reviewing an application do not begin until the sponsor submits the
entire application. We may request fast track designation for SP001 and its
bioequivalents HIV drugs and other products.

We cannot predict whether the FDA will grant these designations, nor can we
predict the ultimate impact, if any, of the fast track process on the timing or
likelihood of FDA approval of our therapeutics. The FDA may, during its review
of a new drug application or biologics license application, ask for additional
test data. If the FDA does ultimately approve the product, it may require
post-marketing testing, including potentially expensive Phase IV studies, and
surveillance to monitor the safety and effectiveness of the drug. In addition,
the FDA may in some circumstances impose restrictions on the use of the drug,
which may be difficult and expensive to administer, and may require prior
approval of promotional materials.

Before approving a new drug application or biologics license application, the
FDA will also inspect the facilities at which the product is manufactured and
will not approve the product unless the manufacturing facilities are in
compliance with current Good Manufacturing Practices ("cGMPs"). In addition, the
manufacture, holding, and distribution of a product must be in compliance with
cGMPs. Manufacturers must continue to expend time, money and effort in the areas
of production, quality control, record keeping and reporting to ensure full
compliance with those requirements. The labeling, advertising, promotion,
marketing and distribution of a drug or biologic product must be in compliance
with FDA regulatory requirements. Failure to comply with applicable requirements
can lead to the FDA demanding that production and shipment cease, and, in some
cases, that the manufacturer recall products, or to FDA enforcement actions that
can include seizures, injunctions and criminal prosecution. These failures can
also lead to FDA withdrawal of approval to market the product.

We have not received approval in the U.S. or any foreign states or foreign
jurisdictions for the commercial sale of any of our potential therapeutics
products. However, the FDA has accepted our IND for the clinical examination of
our SP001 and its bioequivalent HIV drugs. Completion of testing, studies and
trials may take several years, and the length of time varies substantially with
the type, complexity, novelty and intended use of the product. There can be no
assurance that any of our development programs will be successfully completed,
that any IND will become effective or that additional clinical trials will be
allowed by the FDA or other regulatory authorities or that we will successfully
develop any marketable pharmaceutical product.

Sales of pharmaceutical products outside the United States are subject to
foreign regulatory requirements that vary widely from country to country.
Whether or not we have obtained FDA approval, we must obtain approval of a
product by comparable regulatory authorities of foreign countries prior to the
commencement of marketing the product in those countries. The time required to
obtain this approval may be longer or shorter than that required for FDA
approval. The foreign regulatory approval process includes all the risks
associated with FDA regulation set forth above, as well as country specific
regulations.

Environmental Matters

We currently rely primarily on third party independent contractors and the
research efforts of Georgetown University and the University of Iowa to conduct
research and development on and manufacture clinical supplies of our proposed
drugs. However, to the extent that any of our current and future research and
development activities involve the use of hazardous materials and chemicals, or
produce waste products, we will be subject to federal, state and local laws and
regulations governing the use, manufacture, storage, handling and disposal of
these materials. Although we would expect that our safety procedures for
handling and disposing of these materials would comply with the standards
prescribed by such laws and regulations, we may be required to incur significant
costs to comply with environmental and health and safety regulations in the
future. In addition, the risk of accidental contamination or injury from
hazardous and radioactive materials cannot be completely eliminated. The
potential liability for damages stemming from accidents involving these
materials may exceed our $2,000,000 commercial general liability insurance
coverage or available resources.

Product and Clinical Studies Liability

Administration of any drug to humans involves the risk of allergic or other
adverse reactions in certain individuals. Accordingly, it is possible that
claims might be successfully asserted against us for liability with respect to
injuries that may arise from the administration or use of our products during
clinical trials or following commercialization. We presently carry no clinical
studies and product liability insurance. Although we carry a $2,000,000
commercial general liability insurance policy. There can be no assurance that
the coverage the commercial general liability insurance policy provides will be
adequate to satisfy all claims that may arise. Regardless of merit or eventual
outcome, such claims may result in decreased demand for a product, injury to our
reputation, withdrawal of clinical trial volunteers and loss of revenues. Thus,
a clinical trial or product liability claim may result in losses that could be
material.

Employees

As of the date hereof we had 5 employees that work directly for Samaritan
Pharmaceuticals and 7 scientists that work under our collaboration agreement
with Georgetown University. In addition, we make extensive use of consultants.

Properties

The company's executive offices are currently located at 101 Convention Center
Drive, Suite 310, Las Vegas, Nevada 89109. The 1,100 square foot office space is
rented at a base rent of $2,620 per month. In addition, under the Research
Collaboration agreement between Georgetown University and Samaritan
Pharmaceuticals, Georgetown provides space which is located at Samaritan
Research Laboratories, Georgetown University Medical Center, Medical Dental
Building, Suite SE 111, 3900 Reservoir Road, NW, Washington, DC 20007.

Legal Proceedings

We are, from time to time, involved in various legal proceedings in the ordinary
course of our business and are currently executing a settlement agreement signed
by all parties to resolve previously reported pending lawsuits. We believe based
on the settlement agreement that the resolution of any currently pending legal
proceedings, either individually or taken as a whole, will not have a material
adverse effect on our business, financial condition or results of operations.

The FUSION Transaction

General

On April 22, 2003, we entered into a common stock purchase agreement with Fusion
Capital Fund II, LLC pursuant to which Fusion Capital agreed to purchase on each
trading day during the term of the agreement, $20,000 of our common stock or an
aggregate of $10.0 million. The $10.0 million of common stock is to be purchased
over a 25 month period, subject to a 6 month extension or earlier termination at
our discretion. The purchase price of the shares of common stock will be equal
to a price based upon the future market price of the common stock without any
fixed discount to the market price. Fusion Capital does not have the right or
the obligation to purchase shares of our common stock in the event that the
price of our common stock is less than $0.10.

Purchase Of Shares Under The Common Stock Purchase Agreement

Under the common stock purchase agreement, on each trading day Fusion Capital is
obligated to purchase a specified dollar amount of our common stock. Subject to
our right to suspend such purchases at any time, and our right to terminate the
agreement with Fusion Capital at any time, each as described below, Fusion
Capital shall purchase on each trading day during the term of the agreement
$20,000 of our common stock. This daily purchase amount may be decreased by us
at any time. We also have the right to increase the daily purchase amount at any
time, provided however, we may not increase the daily purchase amount above
$20,000 unless our stock price is above $0.45 per share for five consecutive
trading days. The purchase price per share is equal to the lesser of:

o the lowest sale price of our common stock on the purchase
date; or

o the average of the three (3) lowest closing sale prices of our
common stock during the twelve (12) consecutive trading days
prior to the date of a purchase by Fusion Capital.

The purchase price will be adjusted for any reorganization, recapitalization,
non-cash dividend, stock split, or other similar transaction occurring during
the trading days in which the closing bid price is used to compute the purchase
price. Fusion Capital may not purchase shares of our common stock under the
common stock purchase agreement if Fusion Capital, together with its affiliates,
would beneficially own more than 9.9% of our common stock outstanding at the
time of the purchase by Fusion Capital. However, even though Fusion Capital may
not receive additional shares of our common stock in the event that the 9.9%
limitation is ever reached, Fusion Capital is still obligated to pay to us
$20,000 on each trading day, unless the common stock purchase agreement is
suspended, an event of default occurs or the agreement is terminated. Absent
these circumstances, Fusion Capital would have the right to acquire additional
shares in the future should its ownership subsequently become less than the
9.9%. Fusion Capital has the right at any time to sell any shares purchased
under the common stock purchase agreement which would allow it to avoid the 9.9%
limitation. Therefore, we do not believe that Fusion Capital will ever reach the
9.9% limitation.

The following table sets forth the amount of proceeds we would receive from
Fusion Capital from the sale of shares of our common stock offered by this
prospectus at varying purchase prices:

Assumed Average Number of Shares Proceeds Under the Common
Purchase Price to be Purchased Stock Purchase Agreement

$0.10 15,000,000 $1,500,000
$0.15 15,000,000 $2,250,000
$0.22 (1) 15,000,000 $3,300,000
$0.35 15,000,000 $5,250,000
$0.50 15,000,000 $7,500,000
$1.00 10,000,000 $10,000,000
$2.00 5,000,000 $10,000,000
$5.00 2,000,000 $10,000,000
--------------------

(1) Closing sale price of our common stock on Jul 24, 2003.

We estimate that we will sell no more than 15,000,000 shares to Fusion Capital
under the common stock purchase agreement. If we do or do not sell the full
15,000,000 shares to Fusion Capital under the common stock purchase agreement,
we have the right to terminate the agreement without any payment or liability to
Fusion Capital.

Minimum Purchase Price

We have the right to set a minimum purchase price ("floor price") at any time.
Currently, the floor price is $0.15. We can increase or decrease the floor price
at any time upon one trading day prior notice to Fusion Capital. However, the
floor price cannot be less than $0.10. Fusion Capital shall not have the right
nor the obligation to purchase any shares of our common stock in the event that
the purchase price is less than the then applicable floor price.

Our Right To Suspend Purchases

We have the unconditional right to suspend purchases at any time for any reason
effective upon one trading day's notice. Any suspension would remain in effect
until our revocation of the suspension. To the extent we need to use the cash
proceeds of the sales of common stock under the common stock purchase agreement
for working capital or other business purposes, we do not intend to restrict
purchases under the common stock purchase agreement.

Our Right To Increase and Decrease the Daily Purchase Amount

Under the common stock purchase agreement Fusion Capital has agreed to purchase
on each trading day during the 25 month term of the agreement, $20,000 of our
common stock or an aggregate of $10.0 million. We have the unconditional right
to decrease the daily amount to be purchased by Fusion Capital at any time for
any reason effective upon one trading day's notice. We also have the right to
increase the daily purchase amount as the market price of our common stock
increases. Specifically, for every $0.25 increase in Threshold Price above
$0.20, the Company shall have the right to increase the daily purchase amount by
up to an additional $5,000. For example, if the Threshold Price is $0.70 we
would have the right to increase the daily purchase amount to up to an aggregate
of $30,000. The "Threshold Price" is the lowest sale price of our common stock
during the five trading days immediately preceding our notice to Fusion Capital
to increase the daily purchase amount. If at any time during any trading day the
sale price of our common stock is below the Threshold Price, the applicable
increase in the daily purchase amount would be void.

Our Termination Rights

We have the unconditional right at any time for any reason to give notice to
Fusion Capital terminating the common stock purchase agreement. Such notice
shall be effective one trading day after Fusion Capital receives such notice.

Effect of Performance of the Common Stock Purchase Agreement on our Shareholders

All shares registered in this offering will be freely tradable. It is
anticipated that shares registered in this offering will be sold over a period
of up to 25 months from the date of this prospectus. The sale of a significant
amount of shares registered in this offering at any given time could cause the
trading price of our common stock to decline and to be highly volatile. Fusion
Capital may ultimately purchase all of the shares of common stock issuable under
the common stock purchase agreement, and it may sell some, none or all of the
shares of common stock it acquires upon purchase. Therefore, the purchases under
the common stock purchase agreement may result in substantial dilution to the
interests of other holders of our common stock. However, we have the right at
any time for any reason to: (1) reduce the daily purchase amount, (2) suspend
purchases of the common stock by Fusion Capital and (3) terminate the common
stock purchase agreement.

No Short-Selling or Hedging by Fusion Capital

Fusion Capital has agreed that neither it nor any of its affiliates shall engage
in any direct or indirect short-selling or hedging of our common stock during
any time prior to the termination of the common stock purchase agreement.

Events of Default

Generally, Fusion Capital may terminate the common stock purchase agreement
without any liability or payment to the Company upon the occurrence of any of
the following events of default:

o the effectiveness of the registration statement of which this
prospectus is a part of lapses for any reason (including,
without limitation, the issuance of a stop order) or is
unavailable to Fusion Capital for sale of our common stock
offered hereby and such lapse or unavailability continues for
a period of ten (10) consecutive trading days or for more than
an aggregate of thirty (30) trading days in any 365-day
period;

o suspension by our principal market of our common stock
from trading for a period of three consecutive trading
days;

o the de-listing of our common stock from our principal market
provided our common stock is not immediately thereafter
trading on the NASDAQ National Market, the NASDAQ National
Small Cap Market, the New York Stock Exchange or the American
Stock Exchange;

o the transfer agent`s failure for five trading days to issue to
Fusion Capital shares of our common stock which Fusion Capital
is entitled to under the common stock purchase agreement;

o any material breach of the representations or warranties or
covenants contained in the common stock purchase agreement or
any related agreements which has or which could have a
material adverse affect on us subject to a cure period of ten
trading days;

o a default by us of any payment obligation in excess of $1.0
million; or

o any participation or threatened participation in insolvency or
bankruptcy proceedings by or against us.

Commitment Shares Issued to Fusion Capital

Under the terms of the common stock purchase agreement Fusion Capital has
received 3,125,000 shares of our common stock as a commitment fee. Unless an
event of default occurs, these shares must be held by Fusion Capital until 25
months from the date of the common stock purchase agreement or the date the
common stock purchase agreement is terminated.

No Variable Priced Financings

Until the termination of the common stock purchase agreement, we have agreed not
to issue, or enter into any agreement with respect to the issuance of, any
variable priced equity or variable priced equity-like securities unless we have
obtained Fusion Capital's prior written consent.

MANAGEMENT

The following table sets forth our directors and officers, their ages, and all
offices and positions with the Company. Officers and other employees serve at
the will of the board of directors.

Name Age Served Since Positions with Company
--------------------------------------------------------------------------------
Dr. Janet R. Greeson 58 10/97 Director, CEO & President
Dr. Erasto R. C. Saldi 43 5/03 Director
Welter Budd Holden 72 10/97 Director
Eugene J. Boyle 37 06/00 Director, CFO & COO
Brian A. Sullivan 50 03/01 Director
Cynthia C. Thompson 43 03/99 Director
Douglas D. Bessert 45 03/01 Director, VP & Secretary
H. Thomas Winn 62 03/99 Director
Dr, Vassilios Papadopoulos 41 03/01 Director, Chief
Scientific Officer

The Board Of Directors And Committees

Our bylaws provide that our board of directors shall consist of nine (9)
directors that shall be divided into three classes. A single class of directors
shall be elected each year at the annual meeting, and each director shall be
elected to serve for a term ending on the date of the third annual meeting of
stockholders after his election and until his successor has been elected and
duly qualified, subject to any transition periods. The board of directors, which
met 8 times during the year ended December 21, 2002. Most of our directors
attended more than 75% of the aggregate of the total number of meetings of our
board and its committees. The Company has formed, by determination of the board
of directors, an Audit Committee, with Director Winn as Chairman, who is
independent and a financial expert as used in Item 7(d)(3)(iv) of Schedule 14A
(240.14a-101) under the Exchange Act. The Audit Committee met one time during
the year 2002. The Company has also formed a Compensation Committee, with
Director Thompson, as Chairman; a Business Advisory Board, with Director Holden,
as Chairman; and a Scientific Advisory Board, with Director Papadopoulos, as
Chairman.

Class I directors shall serve until the 2004 annual meeting, Class II directors
shall be elected to serve until the 2006 annual meeting. Class III directors
shall be elected to serve until the 2005 annual meeting. Each director elected
shall serve until his successor is elected and duly qualified.

Class I Directors -- Terms Expire 2004

Dr. Janet R. Greeson, 58.
Director since 1997.
Chairman of the Board, CEO, President and Co-Founder.

Dr. Greeson has spearheaded the majority of the financing for the company since
its inception and led the efforts that resulted in the Georgetown University
collaboration. She is also a co-inventor in Samaritan's first patent
application, under the Georgetown University collaboration, for an Alzheimer's
drug. Dr. Greeson's strong leadership and team building skills, business acumen,
negotiation skills and knowledge of public markets has been key to Samaritan's
growth. In the past, Dr. Greeson, a seasoned healthcare professional with over
two decades of corporate experience, focused on emerging growth, mergers and
acquisitions. She is a renowned public speaker and the best selling author of
"It's Not What You're Eating, It's What's Eating You." Her past guest
appearances on numerous radio and TV Talk shows has positioned her to open doors
to TV Producers to tell the Samaritan story in a concise and professional
manner. Dr. Greeson developed "Psychiatric Hospital Programs" for the US Navy
and went on to develop, grow and sell her privately held "Psychiatric Hospital
Units" to Columbia/HCA (NYSE:HCA).

Dr. Greeson has an eclectic past, once working with Mother Theresa, and was
privileged to be the U.S. Congressional Nominee for the State of Nevada in 1994,
winning the primary without spending a dollar to campaign. Dr. Greeson currently
serves on the Board of Restaurant Connections International, Inc., a company
with approximately 17 licensed Pizza Huts in Brazil; on the Board of The CEO
Council, an organization that provides a common voice and platform for officers
and directors of public companies; and on the Board of Intuitive Solutions,
Inc., a Financial Consulting company.

Welter Budd Holden, 72.
Director since 1997.
Member of Compensation Committee and Co-Founder.

Mr. Holden assisted the Company in recruiting and networking patients for
clinical trials. He is a well known designer who has consulted with the rich and
famous throughout his whole life. He is a renowned networker and has presented
Samaritan to many of his past clients, including principals of pharmaceutical
companies. Although for the past five years Mr. Holden has been an independent
consultant providing architectural and interior design advice, he spends at
least half of his time trying to further Samaritan. Mr. Holden is the Chairman
of our Business Advisory Board. He received his BA in architectural and interior
design from the Pratt Institute.

Dr. Erasto R. C. Saldi, 43.
Director since 2003.

Since 1999, Dr. Saldi has been Medical Director of Fremont Medical Clinic,
Desert Lane Care Center, and Cheyenne Care Center, where he improved physician
compliance and formulated patient care protocols. From 1996 to 1997, he was
Chief Resident, Internal Medicine and from 1997 to 1998, he served as Assistant
Clinical professor, Internal Medicine at the University of Nevada, School of
Medicine, Las Vegas, NV. Dr. Saldi has also has extensive experience as an
Internist, Principal Investigator and manager of clinical research trials.

Class II Directors -- Terms Expire 2006

Mr. Eugene J. Boyle, 37.
Director since 2000.
Chief Financial Officer, Chief Operations Officer and Co-Founder.

Mr. Boyle attended Notre Dame and has received a BSE from Tulane University. He
is a veteran of the US Navy serving as a Lt. during the Gulf War. Upon discharge
he then returned to graduate school earning his MBA in Entrepreneurship from
Babson College, Boston, Mass. He is presently in finishing his last year of part
time Law School and devotes his time to business development aspects of
Samaritan, SEC filings, patent prosecution and numerous other legal and business
affairs.

In the past, Mr. Boyle was employed by Columbia/HCA (NYSE:HCA) as its Chief
Operations Officer for the southeast region and also assisted with mergers and
acquisitions of numerous hospitals. He also serves on the Advisory Board of
Nevada Gold and Casinos (AMEX:UWN).Mr. Boyle is a Charted Financial Analyst
candidate, has passed the series 7 and 63 securities brokerage registered
representative exams, although he is not a practicing representative.

Mr. Brian A. Sullivan, 50.
Director since 2001.
Member of Compensation Board.

Mr. Sullivan is totally committed and passionate about Samaritan. He facilitates
all of the public relations strategy for the Company and administrates
Samaritan's Research Laboratory at Georgetown University in Washington, DC. He
has been an incredible asset to the Company aligning us with HIV activist
groups, Aging Institutes and various governmental agencies. Also, Mr. Sullivan
has been instrumental in using his acumen for relationships to present the
Company to many high net worth private investors. In the past, from 1982 to
1996, Mr. Sullivan served as Director of Pratesi of Beverly Hills, where he was
responsible for negotiating a relationship with Neiman-Marcus, starting new
franchises, and opening new stores. From 1996 through 1997, Mr. Sullivan was
Director of Antiques at Charles Pollack, in Los Angeles, increasing sales by
over $1M in one year. Mr. Sullivan has a BA in Psychology and English from the
University of Massachusetts at Amherst, and a Masters in Victorian Philosophy
from the University of Hall in England.

Ms. Cynthia C. Thompson, 43.
Director since 1999.
Chairman of the Compensation Committee and Member of the Audit Committee.

Ms. Thompson is the founder and Chief Executive Officer, since May 1998, of
Service Interactive, Inc., which services food and beverage original equipment
manufacturers and food service vendors nationwide. In May 1998, Ms. Thompson
founded Intuitive Solutions International, Inc., a Houston, Texas firm engaged
in capital formation and operations management consulting, where she serves as
the President. From May 1987 to May 1993 Ms. Thompson was a representative at
E.F. Hutton/Shearson Lehman Brothers in the Regional Institutional assisting
with bank and institutional accounts. From May 1993 to May 1994, she was a
corporate accounts representative with Oppenheimer & Company, Inc., and from May
1994 to May 1998, she was the Director, Corporate Finance Department, of D.E.
Frey & Company, Inc., a brokerage firm.

Class III Directors -- Terms Expire 2005

Mr. Doug D. Bessert, 45.
Director since 2001.
Vice President of Investor Relations and Corporate Secretary.

Mr. Bessert has an extensive network of contacts which provides an active basis
for Samaritan's ability to raise private capital. Mr. Bessert received his BS in
Marketing from the University of Wyoming. Mr. Bessert has over 20 years of
financial and investor relationship experience, with an emphasis in small
entrepreneurial companies. Mr. Bessert devotes the majority of his time to the
affairs of Samaritan's shareholders. Prior to joining Samaritan, he served as a
Branch Manager at a stock brokerage firm in charge of nine other brokers,
handling all compliance and investor problems for the office. Mr. Bessert was
the Founder and CFO of Thorofare Resources Inc., a regional Oil and Gas company
with production and employees in 8 states. He also was a Financial Consultant
that managed portfolios for over 230 clients managing in excess of $43 million
in assets. During his tenure as a financial consultant, he was heavily involved
in leveraged buyouts, raising private capital, and acquisitions of many
entities.

Mr. H. Thomas Winn, 62
Director since 1999.
Chairman of the Audit Committee.

Mr. Winn serves as the Chairman, CEO, President and a Director of Nevada Gold &
Casinos, Inc., (AMEX:UWN) a developer of gaming properties, since January 1994.
He also serves as Chairman and President of Aaminex Capital Corporation, a
consulting and venture capital firm since 1983.

Dr. Vassilios Papadopoulos, D.Pharm., Ph.D., 42
Director since 2001.
Chief Scientific Officer.

Dr. Papadopoulos is head of the Division of Hormone Research and professor of
Cell Biology, Pharmacology &Neuroscience at Georgetown University Medical
Center. Dr. Papadopoulos and his group of scientists originally assisted
Samaritan with work on using Procaine (HCL) to control stress-induced cortisol
production by the human adrenal cells. Dr. Papadopoulos has over eighteen years
of experience and over 130 peer review article publications in the
Biopharmaceutical field and numerous patents in the field of cholesterol
chemistry.

No director or executive officer has any family relationships with any other
director or executive officer of the Company, except that Mr. Boyle is the son
of Dr. Greeson. The Company has formed, by determination of the board of
directors, an Audit Committee, with Director Winn as Chairman, who is
independent and a financial expert as used in Item 7(d)(3)(iv) of Schedule 14A
(240.14a-101) under the Exchange Act. The Company has also formed a Compensation
Committee, with Director Thompson, as Chairman; a Business Advisory Board, with
Director Holden, as Chairman; and a Scientific Advisory Board, with Director
Papadopoulos, as Chairman.

Executive Compensation

The Compensation Committee (CC) of the board of directors administers our
executive compensation program. Each member of the CC is a non-employee
director. The CC is responsible for establishing salaries and administering the
incentive programs for our Chief Executive Officer, and other executive
officers.

Compensation Philosophy

The Compensation Committee has designed Samaritan's compensation program based
on the philosophy that all of our executives are important to our success, with
our executive officers setting the direction of our business and having overall
responsibility for our results. Like other pharmaceuticals companies, we operate
in a highly competitive and difficult economic environment. Accordingly, the CC
has structured Samaritan's compensation to accomplish several goals: 1) attract
and retain very talented individuals, 2) reward creativity in maximizing
business opportunities, and 3) enhance shareholder value by achieving our
short-term and long-term business objectives.

Base Salary

The CC considers the peer data discussed above as well as individual performance
when approving base salaries for executive officers. The CC evaluates individual
performance based on the achievement of corporate or divisional operating goals
and subjective criteria, as well as the Chief Executive Officer's evaluation of
the other executive officers. No specific weight is assigned to any particular
factor. Dr. Greeson, Mr. Boyle, Mr. Bessert and Dr. Papadopoulos each have
employment agreements negotiated on an arm's-length basis with the CC. In
setting base salary, the Board considered the contributions of each executive to
our company, compensation paid by peer companies and outside compensation
reports.

Stock Options

The short and long-term compensation program includes stock options granted
under the Stock Incentive Plan as well as non-qualified stock options. The
Option Plan is designed to reward executives for achieving long-term financial
performance goals over a three-year to ten-year period, provide retention
incentives for executives, and tie a significant portion of an executive's total
compensation to our long-term performance. Stock options for our executive
officers and key associates are part of our incentive program and link the
enhancement of shareholder value directly to their total compensation. The CC
determines the number of stock options granted based upon several factors: 1)
level of responsibility, 2) expected contribution towards our performance, and
3) total compensation strategy for mix of base salary, short-term incentives and
long-term incentives. The following tables and notes present information
concerning compensation to the Company's Chief Executive Officer and to the
Company's most-highly compensated executive officers other than the Company's
Chief Executive Officer who were serving at December 31, 2002.

Summary Compensation Table

Annual Compensation Long Term Compensation
------------------ ----------------------- --------------------------------------------------
Name and Year Salary ($) Accrual Restricted Stock Securities
Principle Position Salary ($) Awards ($) Underlying Options
------------------ -------- ---------- ----------- ----------------- --------------------

Janet Greeson, 2002 $264,983 $131,917 $-0- 1,532,210
Chairman, CEO, 2001 $101,600 $124,083 $152,317 1,532,210
President 2000 $ 30,000 $150,000 $180,000 1,779,684

Eugene Boyle 2002 $97,533 $167,067 $-0- 766,105
CFO, COO 2001 $62,072 $51,463 $138,465 766,105
2000 $-0- $-0- $182,000 444,921

Doug Bessert, 2002 $87,000 $98,062 $-0- 444,921
VP, 2001 $20,000 $ 2,083 $82,917 383,052

Option Grants in Last Fiscal Year

Number of % of Total
Securities Options
Underlying Granted to Exercise
Options Granted Employees in Base Price
Name (#)(1) Fiscal Year ($ / Share) Expiration Date
----------------- ----------------- ------------- ------------- ---------------
Janet Greeson (1) 1,532,210 30.8% $0.14 01/02/2012
Janet Greeson (1) 1,779,684 35.8% $0.14 04/25/2012
Eugene Boyle (1) 766,105 15.4% $0.14 01/02/2012
Eugene Boyle (1) 444,921 9.0% $0.14 04/25/2012
Doug Bessert (1) 44,921 9.0% $0.14 04/12/2012

Aggregate Option Exercises in Last Fiscal Year and FY-End Option Values

Shares Value Number of Number of
Acquired on Realized Securities Unexercised In
Exercised ($)(1) Underlying the Money
(#) Unexercised Options at
Options at FY-End(#)
FY-End ($)
Name
-------------- ------------ ----------- ------------ --------------
Janet Greeson 1,779,684 -0- 4,844,104 45,966
Eugene Boyle 444,921 -0- 1,977,131 22,983
Doug Bessert 483,052 -0- 877,973 8,898

401(k) Plan

We adopted a tax-qualified employee savings and retirement plan, or 401(k) plan,
covering our full-time employees located in the United States. The 401(k) plan
is intended to qualify under Section 401(k) of the Internal Revenue Code of
1986, as amended, so that contributions to the 401(k) plan by employees, and the
investment earnings thereon, are not taxable to employees until withdrawn from
the 401(k) plan. Under the 401(k) plan, employees may elect to reduce their
current compensation up to the statutorily prescribed annual limit and have the
amount of such contribution contributed to the 401(k) plan. The 401(k) plan does
permit additional matching contributions to the 401(k) plan by us on behalf of
participants in the 401(k).

Employment Agreements

We have engaged each executive officer pursuant to a written agreement. In each
agreement, the executive is entitled to base salary and stock options based on a
formula not to be less 250,000 options per year. The executive is also entitled
to convert his salary into shares of the Company based on the formula for the
Company's security. See "Executive Compensation" for amounts of base salary and
stock options for each executive. The executive is also allowed to participate
in all of Samaritan Pharmaceutical's benefit programs, if the Company offers the
programs to any other employee.

If executive terminates by reason of death, disability, incapacity or
termination by Samaritan Pharmaceuticals other than for cause, the executive
will be entitled to continuation of base salary and health and similar benefits
for defined periods, payment of stock options and deferred compensation awards.
In each case, the executive agreed to a non-complete clause for the term of his
employment.

In the event of a change of control, the executive would also vest in his or her
options. The executive would also no longer be subject to non-competition
undertakings. If a change of control were followed by termination of employment
resulting from a change of control termination, in lieu of the severance
benefits described above, the executive would be entitled to receive a payment
equal to three times base salary and yearly options. For up to three years
following termination Samaritan Pharmaceuticals would also be obligated to
provide continued health and other insurance and disability benefits. We would
also be obligated to pay all legal fees and expenses reasonably incurred by the
executive in seeking enforcement of contractual rights following a change of
control. If change of control payments and benefits to any of Dr. Greeson, Mr.
Boyle, and/or Mr. Bessert were sufficient to result in an excise tax under the
so-called "golden parachute" provisions of the Code, we would be obligated to
pay the executive a tax gross-up payment. All three executives are also awarded
options based on increases in market capitalization starting with the market
capitalization of $12,500,000. In addition to the salary and other benefits
described above, Mr. Bessert was awarded 100,000 options at $1.00 on restricted
stock that were vested as the signing of his employment contract.

Dr. Papadopoulos has an engagement agreement with us which does not prohibit Dr.
Papadopoulos from being employed by other entities. Dr. Papadopoulos has
disclosed that he receives payments and benefits from other entities including
Georgetown University. He is compensated on a monthly basis, which he has the
option to convert his compensation into shares plus he receives 250,000 warrants
per year for the life of the contract.

Trust Agreements

The Company has entered into trust agreements and appointed trustees that are
non directors or officers providing for the payment out of the assets of the
trusts accrued under the Company's various benefit plans, employment agreements
and other employment arrangements as the Company specify from time to time. To
the extent not already irrevocable, the trusts would become irrevocable upon a
change of control of Samaritan Pharmaceuticals. The Company may make
contributions to the trusts from time to time, and additional funding could be
required upon a change of control. To the extent funded, the trusts are to be
used, subject to their terms and to the claims of the Company's general
creditors in specified circumstances, to make payments under the terms of the
benefit plans, employment agreements and other employment arrangements from time
to time specified by the Company.

Indemnification Agreements

We have entered into indemnification agreements with each of our directors and
officers, indemnifying them against expenses, settlements, judgments and fines
incurred in connection with any threatened, pending or completed action, suit,
arbitration or proceeding, where the individual's involvement is by reason of
the fact that he or she is or was a director or officer or served at our request
as a director of another organization (except that indemnification is not
provided against judgments and fines in a derivative suit unless permitted by
Nevada law.) An individual may not be indemnified if he or she is found not to
have acted in good faith and in a manner he or she reasonably believed to be in
or not opposed to the best interests of Samaritan Pharmaceuticals, except to the
extent Nevada law shall permit broader contractual indemnification. The
indemnification agreements provide procedures, presumptions and remedies
designed to substantially strengthen the indemnity rights beyond those provided
by our articles of incorporation and by Nevada law.

Commission Position Of Indemnification For Securities Act Liabilities

Insofar as indemnification for liabilities arising under the Securities Act of
1933 (the "Act") may be permitted to directors, officers and controlling persons
of the Company, We have been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Securities Act and is therefore, unenforceable.

Samaritan Pharmaceuticals, Inc. 2001 Stock Incentive Plan (the "2001 Plan").

General

Purpose: The purpose of the 2001 Plan as proposed is to promote our long-term
growth and profitability by providing key people with incentives to improve
stockholder value and contribute to our growth and financial success and by
enabling us to attract, retain and reward the best-available people.

Shares Available under the 2001 Plan: The number of awards that we may grant
under the 2001 Plan in each calendar year will not exceed twenty percent (20%)
of (i) the total shares of common stock outstanding on a fully diluted basis,
without taking into account awards outstanding under the 2001 Plan that are
exercisable for or convertible into common stock or that are unvested stock
awards (referred to as "outstanding awards"), at the close of business on the
last day of the preceding calendar year, less (ii) the number of shares subject
to "outstanding awards" at the close of business on that date. In no event,
however, will more than an aggregate of twelve (12) million shares of common
stock be issued pursuant to incentive stock options intended to qualify under
Section 422 of the Internal Revenue Code. The maximum number of shares of common
stock subject to awards of any combination that may be granted under the 2001
Plan during any fiscal year to any one individual is limited to 500,000, or,
only in the initial year of an individual's employment with our company,
1,000,000. If any award, or portion of an award, under the 2001 Plan expires or
terminates unexercised, becomes unexercisable or is forfeited or otherwise
terminated, surrendered or canceled as to any shares, or if any shares of common
stock are surrendered to us in connection with any award (whether or not such
surrendered shares were acquired pursuant to any award), the shares subject to
such award and the surrendered shares will thereafter be available for further
awards under the 2001 Plan.

Administration: The 2001 Plan will be administered by our directors or by a
committee or committees as the board may appoint from time to time. The
administrator has full power and authority to take all actions necessary to
carry out the purpose and intent of the 2001 Plan, including, but not limited
to, the authority to: (i) determine who is eligible for awards, and the time or
times at which such awards will be granted; (ii) determine the types of awards
to be granted; (iii) determine the number of shares covered by or used for
reference purposes for each award; (iv) impose such terms, limitations,
restrictions and conditions upon any such award as the administrator deems
appropriate; (v) modify, amend, extend or renew outstanding awards, or accept
the surrender of outstanding awards and substitute new awards (provided however,
that, except as noted below, any modification that would materially adversely
affect any outstanding award may not be made without the consent of the holder);
(vi) accelerate or otherwise change the time in which an award may be exercised
or becomes payable and to waive or accelerate the lapse, in whole or in part, of
any restriction or condition with respect to such award, including, but not
limited to, any restriction or condition with respect to the vesting or
exercisability of an award following termination of any grantee's employment or
consulting relationship; and (vii) establish objectives and conditions, if any,
for earning awards and determining whether awards will be paid after the end of
a performance period.

In the event of a stock dividend of, or stock split or reverse stock split
affecting the common stock, (i) the maximum number of shares as to which we may
grant awards under the 2001 Plan and the maximum number of shares with respect
to which we may grant awards during any one fiscal year to any individual, and
(ii) the number of shares covered by and the exercise price and other terms of
outstanding awards, will be adjusted to reflect such event unless the board of
directors determines that no such adjustment will be made.

Except as provided above, in the event of any change affecting the common stock,
the company or its capitalization, by reason of a spin-off, split-up, dividend,
recapitalization, merger, consolidation or share exchange, other than any such
change that is part of a transaction resulting in a "change in control" of the
company (as defined in the 2001 Plan), the administrator, in its discretion and
without the consent of the holders of the awards, will make (i) appropriate
adjustments to the maximum number and kind of shares reserved for issuance or
with respect to which awards may be granted under the 2001 Plan (in the
aggregate and with respect to any individual during any one fiscal year of the
company), and (ii) any adjustments in outstanding awards, including but not
limited to modifying the number, kind and price of securities subject to awards.

In the event of any transaction resulting in a "change in control" of the
company (as defined in the 2001 Plan), outstanding stock options and stock
appreciation rights under the 2001 Plan will terminate upon the effective time
of the "change in control" unless provision is made for the continuation,
assumption, or substitution of the awards by the surviving or successor entity.
In the event of such termination, the holders of stock options and stock
appreciation rights under the 2001 Plan will be permitted to exercise all
portions of awards that are exercisable, for at least twenty days prior to the
effective time of the "change in control." Any such exercise of any portion of
an award that becomes exercisable as a result of a "change in control" will be
deemed to occur immediately prior to the effective time of such "change in
control."

Without the consent of award holders, the administrator may make adjustments in
the terms and conditions of, and the criteria included in, awards in recognition
of unusual or nonrecurring events affecting the company, or the financial
statements of the company or any affiliate, or of changes in applicable laws,
regulations, or accounting principles, whenever the administrator determines
that such adjustments are appropriate in order to prevent dilution or
enlargement of the benefits or potential benefits intended to be made available
under the 2001 Plan.

Without the consent of award holders, the administrator may make any
modifications to any awards, including but not limited to cancellation,
forfeiture, surrender or other termination of the awards, in whole or in part
regardless of the vested status of the award, to facilitate any business
combination the board of directors authorizes to comply with requirements for
treatment as a pooling of interests transaction for accounting purposes under
generally accepted accounting principles.

Participation: Participation in the 2001 Plan will be open to all of our
employees, advisors, sales representatives, officers, directors and other
individuals providing bona fide services to us or any of our affiliates, as the
administrator may select from time to time. As of the date hereof all 6
non-employee directors, and approximately 5 employees, advisors, sales
representatives and consultants would be eligible to participate in the 2001
Plan.

Type of Awards

The 2001 Plan as proposed would allow for the grant of stock options, stock
appreciation rights, stock awards, phantom stock awards and performance awards.
The administrator may grant these awards separately or in tandem with other
awards. The administrator will also determine the prices, expiration dates and
other material conditions governing the exercise of the awards. We, or any of
our affiliates, may make or guarantee loans to assist grantees in exercising
awards and satisfying any withholding tax obligations arising from awards.

Stock Options: The 2001 Plan allows the administrator to grant either awards of
incentive stock options, as that term is defined in section 422 of the Internal
Revenue Code, or nonqualified stock options; provided, however, that only our
employees or employees of our subsidiaries may receive incentive stock option
awards. Options intended to qualify as incentive stock must have an exercise
price at least equal to fair market value on the date of grant, but nonqualified
stock options may be granted with an exercise price less than fair market value.
The option holder may pay the exercise price in cash, by tendering shares of
common stock, by a combination of cash and shares, or by any other means the
administrator approves.

Stock Appreciation Rights: The 2001 Plan allows the administrator to grant
awards of stock appreciation rights which entitle the holder to receive a
payment in cash, in shares of common stock, or in a combination of both, having
an aggregate value equal to the spread on the date of exercise between the fair
market value of the underlying shares on that date and the base price of the
shares specified in the grant agreement.

Stock and Phantom Stock Awards: The 2001 Plan allows the administrator to grant
restricted or unrestricted stock or deferred stock awards, or awards denominated
in stock-equivalent units to eligible participants with or without payment of
consideration by the grantee. Stock awards and phantom stock awards may be paid
in cash, in shares of common stock, or in a combination of both.

Performance Awards: The 2001 Plan allows the administrator to grant performance
awards which become payable in cash, in shares of common stock, or in a
combination of both, on account of attainment of one or more performance goals
established by the administrator. The administrator may establish performance
goals based on our operating income, or that of our affiliates, or one or more
other business criteria the administrator may select that applies to an
individual or group of individuals, a business unit, or us or our affiliate as a
whole, over such performance period as the administrator may designate.

Other Stock-Based Awards: The 2001 Plan allows the administrator to grant
stock-based awards which may be denominated in cash, common stock, or other
securities, stock equivalent units, stock appreciation units, securities or
debentures convertible into common stock, or any combination of the foregoing.
These awards may be paid in common stock or other securities, in cash, or in a
combination of common stock, other securities and cash.

Amendment and Termination

Our board of directors may terminate, amend or modify the 2001 Plan or any
portion thereof at any time. Unless sooner terminated by our board, the 2001
Plan will terminate on March 31, 2011.

Federal Income Tax Consequences

The following is a general summary of the current federal income tax treatment
of stock options, which would be authorized for grants under the 2001 Plan as
proposed, based upon the current provisions of the Internal Revenue Code and
regulations promulgated thereunder.

Incentive Stock Options: Incentive stock options under the 2001 Plan are
intended to meet the requirements of section 422 of the Internal Revenue Code.
No tax consequences result from the grant of the option. If an option holder
acquires stock upon exercise, the option holder will not recognize income for
ordinary income tax purposes (although the difference between the option
exercise price and the fair market value of the stock subject to the option may
result in alternative minimum tax liability to the option holder) and we will
not be allowed a deduction as a result of such exercise, provided that the
following conditions are met: (a) at all times during the period beginning with
the date of the granting of the option and ending on the day three months before
the date of such exercise, the option holder is our employee or an employee of
one of our subsidiaries; and (b) the option holder makes no disposition of the
stock within two years from the date of the option grant nor within one year
after the transfer of the stock to the option holder. The three-month period
extends to one year in the event of disability and is waived in the event of
death of the employee. If the option holder sells the stock after complying with
these conditions, any gain realized over the price paid for the stock ordinarily
will be treated as capital gain, and any loss will be treated as capital loss,
in the year of the sale.

If the option holder fails to comply with the employment requirements discussed
above, the tax consequences will be substantially the same as for a nonqualified
option, discussed below. If the option holder fails to comply with the holding
period requirements discussed above, the option holder will recognize ordinary
income in an amount equal to the lesser of (i) the excess of the fair market
value of the stock on the date the option was exercised over the exercise price
or (ii) the excess of the amount realized upon such disposition over the
adjusted tax basis of the stock. Any additional gain ordinarily will be
recognized by the option holder as capital gain, either long-term or short-term,
depending on the holding period of the shares. If the option holder is treated
as having received ordinary income because of his or her failure to comply with
either condition above, we will be allowed an equivalent deduction in the same
year.

Nonqualified Stock Options: No tax consequences result from the grant of the
option. An option holder who exercises a nonqualified stock option generally
will realize compensation taxable as ordinary income in an amount equal to the
difference between the exercise price and the fair market value of the shares on
the date of exercise, and we will be entitled to a deduction from income in the
same amount in the fiscal year in which the exercise occurred. The option
holder's basis in these shares will be the fair market value on the date income
is realized, and when the holder disposes of the shares he or she will recognize
capital gain or loss, either long-term or short-term, depending on the holding
period of the shares.

Disallowance of Deductions: The Internal Revenue Code disallows deductions for
publicly held corporations with respect to compensation in excess of $1,000,000
paid to the corporation's chief executive officer and its four other most highly
compensated officers. However, compensation payable solely on account of
attainment of one or more performance goals is not subject to this deduction
limitation if certain statutory requirements are satisfied. Under this
exception, the deduction limitation does not apply with respect to compensation
otherwise deductible on account of stock options and stock appreciation rights
granted at fair market value under a plan, such as the 2001 Plan, that limits
the number of shares that may be issued to any individual and which are approved
by the corporation's stockholders.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth, as of the date hereof, certain information with
respect to the beneficial ownership of shares of common stock by (i) each person
known to us to be the beneficial owner of more than 5 percent of our outstanding
shares of common stock, (ii) each of our directors, (iii) each of our officers
and (iv) our directors and officers as a group.

Name and Address of Number Percentage
Beneficial Owner of shares Owned of Class (3)
------------------- ------------- -------------------

Welter Holden (1) (2) 450,250 0.56%
P.O. Box 211
144 Gallows Lane
Litchfield CT 06759

Dr. Janet Greeson (1) (2) 5,044,104 5.9%
101 Convention Center Dr # 310
Las Vegas, NV 89109

Erasto R. C. Saldi, MD (2) 25,000 0.03%
11304 Golden Chestnut Pl.
Las Vegas, NV 89135

Cynthia Thompson (1) (2) 759,555 0.94%
3040 Post Oak Blvd. #695
Houston, Texas 77056

H. Thomas Winn (1) (2) 275,000 0.33%
3040 Post Oak Blvd. #675
Houston, Texas 77056

Eugene Boyle (1) (2) 3,371,381 4.09%
101 Convention Center Drive #310
Las Vegas, Nevada, 89109

Dr. Vassilios Papadopoulos (1) (2) 750,000 0.92%
101 Convention Center Drive #310
Las Vegas, NV 89109

Brian Sullivan (1) (2) 953,250 1.18%
P.O. Box 211
144 Gallows Lane
Litchfield CT 06759

Doug Bessert (1) (2) 877,973 1.08%
101 Convention Center Drive #310
Las Vegas, Nevada, 89109

Samaritan Pharmaceuticals Inc 7,535,513 9.36%
Executive Trust (4) (5)
FBO Dr. Janet Greeson

Samaritan Pharmaceuticals Inc 3,989,823 4.95%
Executive Trust (4) (5)
FBO Eugene Boyle

Samaritan Pharmaceuticals Inc 2,470,583 3.07%
Executive Trust (4) (5)
FBO Doug Bessert

Samaritan Pharmaceuticals Inc 850,000 1.06%
Executive Trust (4) (5)
FBO Dr. Vassilios Papadopoulos

Fusion Capital Fund II, LLC 5,692,193 7.07%
222 Merchandise Mart Plaza,
Suite 9-112
Chicago, IL 60654 (6)

All officers and directors 12,506,513 13.99%
as a group 9 persons (1)
-----------------------------------------------------

(1) Includes shares of common stock which each of the following
directors and executive officers had the right to acquire as of
the date hereof or within sixty (60) days thereafter through
the exercise of options: Dr. Janet Greeson (4,844,104
options), Dr. Vassilios Papadopoulos (750,000 options), Mr.
Eugene Boyle (1,977,131 options), Mr. Doug Bessert (877,973
options). Welter Holden Cynthia Thompson H. Thomas Winn Brian
Sullivan (100,000 options). Dr. Erasto R. C. Saldi, MD
(25,000 options). Excludes vested deferred shares payable
in shares held in trust by the company.
(2) Officer and/or director.
(3) Calculated on the basis of 80,526,337 shares of common stock
issued and outstanding as of May 28, 2003.
(4) Dr. Janet Greeson, Eugene Boyle, Doug Bessert and Dr.
Vassilios Papadopoulos do not have the power to vote or direct
the disposition of these shares in the respective trusts and
therefore each disclaims beneficial ownership of the shares in
the respective trusts.
(5) Address for the Trustee of the Executive Trusts is PO Box 22790
Santa Fe, NM, 87502
(6) Steven G. Martin and Joshua B. Scheinfeld, the principals of
Fusion Capital, are deemed to be beneficial owners of all of the
shares of common stock owned by Fusion Capital. Messrs.
Martin and Scheinfeld have shared voting and investment
power over the shares being offered under this prospectus.

SELLING STOCKHOLDER

The following table presents information regarding the selling stockholder.
Neither the selling stockholder nor any of its affiliates has held a position or
office, or had any other material relationship, with us.

Selling Shares Beneficially Percentage of Shares to be Sold Percentage of Outstanding
Stockholder Owned Before Outstanding Shares in the Offering Shares Beneficially Owned
----------- Offering Beneficially Owned ----------------- After Offering
-------------------- Before Offering (1) -------------------------
------------------

Fusion Capital
Fund II, LLC (1)(2) 5,692,193 7.07% 18,125,000 3.19%
----------------------

(1) As of the date hereof, 5,692,193 shares of Fusion Capital have been
previously acquired by Fusion Capital. Fusion Capital may acquire up to an
additional 15,000,000 shares under the common stock purchase agreement.
Percentage of outstanding shares is based on 80,526,337 shares of common
stock outstanding as of May 28, 2003. Fusion Capital may not purchase
shares of our common stock under the common stock purchase agreement if
Fusion Capital, together with its affiliates, would beneficially own more
than 9.9% of our common stock outstanding at the time of the purchase by
Fusion Capital. However, even though Fusion Capital may not receive
additional shares of our common stock in the event that the 9.9% limitation
is ever reached, Fusion Capital is still obligated to pay to us $20,000 on
each trading day, unless the common stock purchase agreement is suspended,
an event of default occurs or the agreement is terminated. Under these
circumstances, Fusion Capital would have the right to acquire additional
shares in the future should its ownership subsequently become less than the
9.9%. Fusion Capital has the right at any time to sell any shares purchased
under the common stock purchase agreement which would allow it to avoid the
9.9% limitation. Therefore, we do not believe that Fusion Capital will ever
reach the 9.9% limitation.

(2) Steven G. Martin and Joshua B. Scheinfeld, the principals of Fusion
Capital, are deemed to be beneficial owners of all of the shares of
common stock owned by Fusion Capital. Messrs. Martin and Scheinfeld have
shared voting and investment power over the shares being offered under
this prospectus.

Plan of Distribution

The common stock offered by this prospectus is being offered by Fusion Capital
Fund II, LLC, the selling stockholder. The common stock may be sold or
distributed from time to time by the selling stockholder directly to one or more
purchasers or through brokers, dealers, or underwriters who may act solely as
agents at market prices prevailing at the time of sale, at prices related to the
prevailing market prices, at negotiated prices, or at fixed prices, which may be
changed. The sale of the common stock offered by this prospectus may be effected
in one or more of the following methods:

o ordinary brokers' transactions;
o transactions involving cross or block trades;
o through brokers, dealers, or underwriters who may act solely as agents;
o "at the market" into an existing market for the common stock;
o in other ways not involving market makers or established trading
markets, including direct sales to purchasers or sales effected through
agents;
o in privately negotiated transactions; or
o any combination of the foregoing.

In order to comply with the securities laws of certain states, if applicable,
the shares may be sold only through registered or licensed brokers or dealers.
In addition, in certain states, the shares may not be sold unless they have been
registered or qualified for sale in the state or an exemption from the
registration or qualification requirement is available and complied with.

Brokers, dealers, underwriters, or agents participating in the distribution of
the shares as agents may receive compensation in the form of commissions,
discounts, or concessions from the selling stockholder and/or purchasers of the
common stock for whom the broker-dealers may act as agent. The compensation paid
to a particular broker-dealer may be less than or in excess of customary
commissions.

Fusion Capital is an "underwriter" within the meaning of the Securities Act.

Neither we nor Fusion Capital can presently estimate the amount of compensation
that any agent will receive. We know of no existing arrangements between Fusion
Capital, any other stockholder, broker, dealer, underwriter, or agent relating
to the sale or distribution of the shares offered by this prospectus. At the
time a particular offer of shares is made, a prospectus supplement, if required,
will be distributed that will set forth the names of any agents, underwriters,
or dealers and any compensation from the selling stockholder and any other
required information.

We will pay all of the expenses incident to the registration, offering, and sale
of the shares to the public other than commissions or discounts of underwriters,
broker-dealers, or agents. We have also agreed to indemnify Fusion Capital and
related persons against specified liabilities, including liabilities under the
Securities Act.

Insofar as indemnification for liabilities arising under the Securities Act may
be permitted to our directors, officers, and controlling persons, we have been
advised that in the opinion of the SEC this indemnification is against public
policy as expressed in the Securities Act and is therefore, unenforceable.

Fusion Capital and its affiliates have agreed not to engage in any direct or
indirect short selling or hedging of our common stock during the term of the
common stock purchase agreement.

We have advised Fusion Capital that while it is engaged in a distribution of the
shares included in this prospectus it is required to comply with Regulation M
promulgated under the Securities Exchange Act of 1934, as amended. With certain
exceptions, Regulation M precludes the selling stockholder, any affiliated
purchasers, and any broker-dealer or other person who participates in the
distribution from bidding for or purchasing, or attempting to induce any person
to bid for or purchase any security which is the subject of the distribution
until the entire distribution is complete. Regulation M also prohibits any bids
or purchases made in order to stabilize the price of a security in connection
with the distribution of that security. All of the foregoing may affect the
marketability of the shares offered hereby this prospectus.

This offering will terminate on the date that all shares offered by this
prospectus have been sold by Fusion Capital.

DESCRIPTION OF CAPITAL STOCK

Common Stock

Our authorized capital stock consists of 200,000,000 authorized shares of common
stock, $.001 par value, of which 80,526,337 shares were outstanding as of May
28, 2003. The holders of our common stock are entitled to one (1) vote for each
share on all matters voted on by stockholders, including the election of
directors and, except as otherwise required by law, or provided in any
resolution adopted by our board of directors with respect to any series of
preferred stock, exclusively possess all voting power. Under our articles of
incorporation, voting rights are non-cumulative so that stockholders holding
more than 50% of our outstanding shares of common stock are able to elect all
members of our board of directors. Holders of shares of our common stock are
entitled to share ratably in dividends, if any, as may be declared, from time to
time by our board of directors in its discretion, from funds legally available
to be distributed. In the event of a liquidation, dissolution or winding up of
the company, the holders of shares of common stock are entitled to share pro
rata all assets remaining after payment in full of all liabilities. Holders of
our common stock have no preemptive rights to purchase our common stock. There
are no conversion rights or redemption or sinking fund provisions with respect
to our common stock.

Preferred Stock

Our authorized capital stock also includes 5,000,000 shares of preferred stock,
$.001 par value of which no shares were outstanding as of the date of this
prospectus. Our articles of incorporation authorize a class of preferred stock
commonly known as a "blank check" preferred stock. Specifically, the preferred
stock may be issued from time to time by the board of directors as shares of one
or more classes or series. Our board of directors, subject to the provisions of
our Certificate of Incorporation and limitations imposed by law, is authorized
to adopt resolutions; to issue the shares; to fix the number of shares; to
change the number of shares constituting any series; and to provide for or
change the following: the voting powers; designations; preferences; and
relative, participating, optional or other special rights, qualifications,
limitations or restrictions, including the following: dividend rights, including
whether dividends are cumulative; dividend rates; terms of redemption, including
sinking fund provisions; - redemption prices; conversion rights; and liquidation
preferences of the shares constituting any class or series of the preferred
stock.

In each such case, we will not need any further action or vote by our
stockholders. One of the effects of undesignated preferred stock may be to
enable the board of directors to render more difficult or to discourage an
attempt to obtain control of us by means of a tender offer, proxy contest,
merger or otherwise, and thereby to protect the continuity of our management.
The issuance of shares of preferred stock pursuant to the board of director's
authority described above may adversely affect the rights of holders of common
stock. For example, preferred stock issued by us may rank prior to the common
stock as to dividend rights, liquidation preference or both, may have full or
limited voting rights and may be convertible into shares of common stock.
Accordingly, the issuance of shares of preferred stock may discourage bids for
the common stock at a premium or may otherwise adversely affect the market price
of the common stock.

Warrants And Options

We currently have warrants and options outstanding for 15,527,258 shares of
common stock, which are exercisable at prices ranging from $0.10 per share to
$2.00 per share.

Board Of Directors

Our bylaws, which were approved by the directors on March 6, 2001, provide that
our board of directors shall consist of nine (9) directors that shall be divided
into three classes. The authorized number of directors may from time to time be
increased to not more than fifteen (15) or decreased to not less than three (3)
by resolution of the board of directors. A single class of directors shall be
elected each year at the annual meeting, and each director shall be elected to
serve for a term ending on the date of the third annual meeting of stockholders
after his election and until his successor has been elected and duly qualified,
subject to any transition periods. This provision in our bylaws would delay,
defer or prevent a change in control of Samaritan Pharmaceuticals. Our board of
directors or stockholders may remove a director at any time, with or without
cause.

Amendment Of Our Bylaws

Our bylaws may be adopted, amended or repealed by the affirmative vote of more
than eighty percent (80%) of our outstanding shares. Our bylaws also may be
adopted, amended or repealed by our board of directors.

Nevada Laws

The Nevada Business Corporation Law contains a provision governing "Acquisition
of Controlling Interest." This law provides generally that any person or entity
that acquires 20% or more of the outstanding voting shares of a publicly-held
Nevada corporation in the secondary public or private market may be denied
voting rights with respect to the acquired shares, unless a majority of the
disinterested stockholders of the corporation elects to restore such voting
rights in whole or in part. The control share acquisition act provides that a
person or entity acquires "control shares" whenever it acquires shares that, but
for the operation of the control share acquisition act, would bring its voting
power within any of the following three ranges: (1) 20 to 33 1/3%, (2) 33 1/3 to
50%, or (3) more than 50%. A "control share acquisition" is generally defined as
the direct or indirect acquisition of either ownership or voting power
associated with issued and outstanding control shares. The stockholders or board
of directors of a corporation may elect to exempt the stock of the corporation
from the provisions of the control share acquisition act through adoption of a
provision to that effect in the articles of incorporation or bylaws of the
corporation. Our articles of incorporation and bylaws do not exempt our common
stock from the control share acquisition act. The control share acquisition act
is applicable only to shares of "Issuing Corporations" as defined by the act. An
Issuing Corporation is a Nevada corporation, which; (1) has 200 or more
stockholders, with at least 100 of such stockholders being both stockholders of
record and residents of Nevada; and (2) does business in Nevada directly or
through an affiliated corporation.

At this time, we do not have 100 stockholders of record resident of Nevada.
Therefore, the provisions of the control share acquisition act do not apply to
acquisitions of our shares and will not until such time as these requirements
have been met. At such time as they may apply to us, the provisions of the
control share acquisition act may discourage companies or persons interested in
acquiring a significant interest in or control of Samaritan Pharmaceuticals,
regardless of whether such acquisition may be in the interest of our
stockholders.

The Nevada "Combination with Interested Stockholders Statute" may also have an
effect of delaying or making it more difficult to effect a change in control of
Samaritan Pharmaceuticals. This statute prevents an "interested stockholder" and
a resident domestic Nevada corporation from entering into a "combination",
unless certain conditions are met. The statute defines "combination" to include
any merger or consolidation with an "interested stockholder," or any sale,
lease, exchange, mortgage, pledge, transfer or other disposition, in one
transaction or a series of transactions with an "interested stockholder" having;
(1) an aggregate market value equal to 5 percent or more of the aggregate market
value of the assets of the corporation; (2) an aggregate market value equal to 5
percent or more of the aggregate market value of all outstanding shares of the
corporation; or (3) representing 10 percent or more of the earning power or net
income of the corporation. An "interested stockholder" means the beneficial
owner of 10 percent or more of the voting shares of a resident domestic
corporation, or an affiliate or associate thereof. A corporation affected by the
statute may not engage in a "combination" within three years after the
interested stockholder acquires its shares unless the combination or purchase is
approved by the board of directors before the interested stockholder acquired
such shares. If approval is not obtained, then after the expiration of the
three-year period, the business combination may be consummated with the approval
of the board of directors or a majority of the voting power held by
disinterested stockholders, or if the consideration to be paid by the interested
stockholder is at least equal to the highest of: (1) the highest price per share
paid by the interested stockholder within the three years immediately preceding
the date of the announcement of the combination or in the transaction in which
he became an interested stockholder, whichever is higher; (2) the market value
per common share on the date of announcement of the combination or the date the
interested stockholder acquired the shares, whichever is higher; or (3) if
higher for the holders of preferred stock, the highest liquidation value of the
preferred stock.

Transfer Agent

The transfer agent for the common stock is Securities Transfer Corporation, 2591
Dallas Parkway, Suite 102, Frisco, Texas 75034.

SHARES ELIGIBLE FOR FUTURE SALE

Upon completion of this offering, we will have 80,526,337 shares of common stock
issued and outstanding. Of these shares, the 18,125,000 sold in this offering
will not be deemed to be restricted shares under the Securities Act of 1933. As
of May 28, 2003, 54,349,354 of these shares are deemed to be restricted shares
under the Securities Act of 1933. The restricted shares will be eligible for
sale pursuant to Rule 144 of the Securities Act at the expiration of the
one-year holding period from their date of acquisition. The one-year holding
period for some shares has ended.

Prior to this offering there has been a limited market for the common stock and
no predictions can be made of the effect, if any, that market sales of
restricted shares or the availability of restricted shares for sale will have on
the market price of the shares if a market for the shares develops.
Nevertheless, sales of substantial amounts of the restricted shares in the
public market could adversely affect such market prices.

LEGAL MATTERS

Legal matters in connection with the validity of the shares of common stock
offered hereby will be passed upon for us by Kirkpatrick & Lockhart LLP, Miami,
Florida.

EXPERTS

Sherb & Co., LLP, independent certified public accountants, have audited our
consolidated financial statements at December 31, 2002 and 2001 and for the two
years then ended as set forth in their included report. We have included our
consolidated financial statements in the registration statement, in reliance on
their report given their authority as an expert in accounting and auditing.

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
ON ACCOUNTING AND FINANCIAL DISCLOSURE

Feldman Sherb & Co., P.C., a professional corporation of certified public
accountants ("Feldman") was our independent accounting firm for the fiscal years
ended December 31, 2001 and 2000 and the four month ten day period ended May 10,
2002. The report of Feldman on our 2001 and 2000 consolidated financial
statements contained no adverse opinion, disclaimer of opinion or modification
of the opinion except that their report on the 2001 financial statements
contains an explanatory paragraph that states that "the accompanying financial
statements have been prepared assuming that the Company will continue as a going
concern. The Company has incurred significant losses and as more fully described
in Note 1, the Company anticipates that additional funding will be necessary to
sustain the Company's operations through the year ending December 31, 2002.
These conditions raise substantial doubt about the Company's ability to continue
as a going concern. Management's plans in regard to these matters are also
described in Note 1. The financial statements do not include any adjustments
that might result from the outcome of this uncertainty."

Feldman was merged into Grassi & Co., CPA's, P.C., ("Grassi") and the principal
accountants who had been responsible for the Company's audit during the years
ended December 31, 2001 and 2000 left and started their own firm called Sherb &
Co., LLP ("Sherb"). As a result, on May 11, 2002, the Company dismissed Grassi
and selected Sherb to serve as independent public accountants for the fiscal
year 2002.

During the two most recent fiscal years and through May 10, 2002, Registrant has
not consulted with Sherb regarding the application of accounting principles to a
specific or contemplated transaction. Neither the Company nor anyone on its
behalf consulted with Sherb regarding the type of audit opinion that might be
rendered on the Company's financial statements or any matter that was the
subject of a disagreement or event as defined at Item 304(a) (2) of Regulation
S-B.

The decision to change accountants was recommended and approved by the board of
directors of the Company. During the period from January 1, 1999 to May 10,
2002, and through the date hereof, there were no disagreements with Feldman on
any matter of accounting principles or practices, financial statement
disclosure, or auditing scope or procedure, which disagreements, if not resolved
to the satisfaction of Feldman, would have caused it to make reference to the
subject matter of the disagreements in connection with its reports on the
Company's financial statements as described on Item 304(a)(1)(iv)(A). In
addition, there were no such events as described under Item 304(a) (1) (iv) (B)
of Regulation S-B during such periods.

On September 24, 2002, the Company has provided Grassi, with a copy of the
disclosures it is making herein in response to Item 304(a) of Regulation S-B,
and has requested that Grassi provide its response letter, addressed to the
United States Securities and Exchange Commission, pursuant to Item 304(a) (3) of
Regulation S-B, stating whether it agrees with the statements made by the
Company and, if not, stating the respects in which it does not agree. A copy of
Grassi's letter is attached as an exhibit to Form 8-K filed on September 27,
2002.

ADDITIONAL INFORMATION

We are subject to the reporting requirements of the Securities Exchange Act of
1934, as amended, and file reports, proxy statements and other information with
the Securities and Exchange Commission. These reports, proxy statements and
other information may be inspected and copied at the public reference facilities
maintained by the Securities and Exchange Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549 and at the Securities and Exchange Commission's regional
offices. You can obtain copies of these materials from the Public Reference
Section of the Securities and Exchange Commission upon payment of fees
prescribed by the Securities and Exchange Commission. You may obtain information
on the operation of the Public Reference Room by calling the Securities and
Exchange Commission at 1-800-SEC-0330. The Securities and Exchange Commission's
Web site contains reports, proxy and information statements and other
information regarding registrants that file electronically with the Securities
and Exchange Commission. The address of that site is http://www.sec.gov.

We have filed a registration statement on Form SB-2 with the Securities and
Exchange Commission under the Securities Act with respect to the securities
offered in this prospectus. This prospectus, which is filed as part of a
registration statement, does not contain all of the information set forth in the
registration statement, some portions of which have been omitted in accordance
with the Securities and Exchange Commission's rules and regulations. Statements
made in this prospectus as to the contents of any contract, agreement or other
document referred to in this prospectus are not necessarily complete and are
qualified in their entirety by reference to each such contract, agreement or
other document which is filed as an exhibit to the registration statement. The
registration statement may be inspected without charge at the public reference
facilities maintained by the Securities and Exchange Commission, and copies of
such materials can be obtained from the Public Reference Section of the
Securities and Exchange Commission at prescribed rates.

SAMARITAN PHARMACEUTICALS, INC.
(A DEVELOPMENT STAGE COMPANY)
- -----------------------------

INDEX
Page Number
-----------
INDEPENDENT AUDITORS' REPORT F-2

CONSOLIDATED FINANCIAL STATEMENTS:

Balance Sheet F-3

Statements of Operations F-4

Statements of Shareholders' Deficit F-5-F-6

Statements of Cash Flows F-7

Notes to Financial Statements F-8 - F-15

INDEPENDENT AUDITORS' REPORT

Board of Directors and Shareholders'
Samaritan Pharmaceuticals, Inc.

We have audited the accompanying consolidated balance sheet of Samaritan
Pharmaceuticals, Inc. (a development stage company) as of December 31, 2002 and
the related consolidated statements of operations, shareholders' deficit and
cash flows for the years ended December 31, 2002 and 2001 and for the period
from inception (September 5, 1994) through December 31, 2002. These financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audit. The financial statements of Samaritan Pharmaceuticals, Inc., for the
period from inception (September 5, 1994) through December 31, 1999 were audited
by other auditors who expressed an unqualified opinion on those statements.
Those statements reflect total revenues of $50,000 and total expenses of
$5,863,678. Our opinion, insofar, as it relates to the amounts for the period
from inception (September 5, 1994) through December 31, 1999, is based solely on
the report of the other auditors.

We conducted our audit in accordance with auditing standards generally
accepted in the United States of America. Those standards require that we plan
and perform the audit to obtain reasonable assurance about 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. We believe that our audit provides a
reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly,
the consolidated financial position of Samaritan Pharmaceuticals, Inc. (a
development stage company) as of December 31, 2002 and the consolidated results
of its operations and its cash flows for the years ended December 31, 2002 and
2001 and for the period from inception (September 5, 1994) through December 31,
2002 in conformity with accounting principles generally accepted in the United
States of America.

The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. The Company has incurred significant
losses and as more fully described in Note 1, the Company anticipates that
additional funding will be necessary to sustain the Company's operations through
the year ending December 31, 2003. These conditions raise substantial doubt
about the Company's ability to continue as a going concern. Management's plans
in regard to these matters are also described in Note 1. The financial
statements do not include any adjustments that might result from the outcome of
this uncertainty.

/s/ Sherb & Co., LLP
Sherb & Co., LLP
Certified Public Accountants

New York, New York
April 9, 2003
F-2

SAMARITAN PHARMACEUTICALS, INC.
(A DEVELOPMENT STAGE COMPANY)

CONSOLIDATED BALANCE SHEET

December 31, 2002

ASSETS

CURRENT ASSETS:
Cash $ 357,826
Prepaid expenses 3,000
-------------------
TOTAL CURRENT ASSETS 360,826
-------------------
PROPERTY AND EQUIPMENT 35,205
-------------------
OTHER ASSETS:
Patent registration costs 197,366
Purchased technology rights 52,671
Deposits 15,720
-------------------
TOTAL OTHER ASSETS 265,757
-------------------
$ 661,788
===================

LIABILITIES AND SHAREHOLDERS' DEFICIT

CURRENT LIABILITIES:
Accounts payable $ 465,313
Accrued expenses 724,675
Short-term borrowings 156,955
-------------------
TOTAL CURRENT LIABILITIES 1,346,943
-------------------
DEFERRED REVENUE 250,000
-------------------

SHAREHOLDERS' DEFICIT:
Common stock, 100,000,000 shares authorized at $.001
par value, 64,549,908 issued and outstanding 64,550
Additional paid-in capital 16,794,240
Accumulated deficit during development stage (17,793,945)
-------------------
TOTAL SHAREHOLDERS' DEFICIT (935,155)
-------------------
$ 661,788
===================

See accompanying notes to the consolidated financial statements.

F-3

SAMARITAN PHARMACEUTICALS, INC.

(A DEVELOPMENT STAGE COMPANY)

CONSOLIDATED STATEMENTS OF OPERATIONS

FROM INCEPTION (SEPTEMBER 5, 1994), AND FOR THE FOR THE NINE MONTHS
AND FOR THE YEARS ENDED DECEMBER 31, 2002 AND 2001

From
Inception
(September 5, 1994) December 31,
December 31, 2002 2002 2001
------------------- ------------ ------------

REVENUES: $ 50,000 $ - $ -
------------------- ------------ ------------
EXPENSES:

Research and development 3,901,341 1,097,248 1,068,902
Interest, net 43,672 20,307 9,420
General and administrative 12,939,872 2,419,215 2,623,148
Depreciation and amortization 1,096,840 520,383 516,116
Forgiveness of debt (137,780) - (137,780)
------------------ ------------ ------------
17,843,945 4,057,153 4,079,806
------------------- ------------ ------------
NET LOSS $ (17,793,945) $ (4,057,153) $ (4,079,806)
=================== ============ ============

Loss per share, basic & diluted: $ (1.09) $ (0.08) $ (0.17)
=================== ============ ============
Weighted average number of shares outstanding:

Basic and diluted 16,324,613 50,788,659 24,467,817
=================== ============ ============

See accompanying notes to the consolidated financial statements.

F-4

SAMARITAN PHARMACEUTICALS, INC.
(A DEVELOPMENT STAGE COMPANY)

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' DEFICIT

FROM INCEPTION (SEPTEMBER 5, 1994) TO DECEMBER 31, 2002

Number Par Value Reserved Additional Total
of Common for Paid in Deferred Accumulated Shareholders'
Shares Stock Conversion Capital Warrants Compensation Deficit Deficit
----------- -------- ---------- ---------- ----------- ------------ ----------- -----------

Inception at September 5, 1994 - $ - $ - $ - $ - $ - $ - $ -

Shares issued for cash, net of
offering costs 6,085,386 609 - 635,481 - - - 636,090
Warrants issued for cash - - - - 5,000 - - 5,000
Shares issued as compensation
for services 714,500 71 - 1,428,929 - - - 1,429,000

Net loss - - - - - - (2,152,843) (2,152,843)
----------- -------- ---------- ---------- ----------- ------------ ----------- -----------
December 31, 1996 6,799,886 680 - 2,064,410 5,000 - (2,152,843) (82,753)

Issuance of stock, prior to
acquisition 206,350 21 - 371,134 - - - 371,155
Acquisition of subsidiary for
stock 1,503,000 150 - 46,545 - - - 46,695

Shares of parent redeemed,
par value $.001 (8,509,236) (851) - 851 - - - -
Shares of public subsidiary
issued, par value $.001 7,689,690 7,690 820 (8,510) - - - -

Net loss - - - - - - (979,635) (979,635)
----------- -------- ---------- ---------- ----------- ------------ ----------- -----------

December 31, 1997 7,689,690 7,690 820 2,474,430 5,000 - (3,132,478) (644,538)

Conversion of parent's shares 696,022 696 (696) - - - - -
Shares issued for cash, net of
offering costs 693,500 694 - 605,185 - - - 605,879
Shares issued in cancellation
of debt 525,000 525 - 524,475 - - - 525,000
Shares issued as compensation 400,000 400 - 349,600 - - - 350,000

Net loss - - - - - - (1,009,945) (1,009,945)
----------- -------- ---------- ---------- ----------- ------------ ----------- -----------
December 31, 1998 10,004,212 10,005 124 3,953,690 5,000 - (4,142,423) (173,604)

Conversion of parent's shares 13,000 13 (13) - - - - -
Shares issued in cancellation
of debt 30,000 30 - 29,970 - - - 30,000
Shares issued for cash, net
of offering costs 45,000 45 - 41,367 - - - 41,412
Shares issued as compensation 3,569,250 3,569 - 462,113 - - - 465,682
Detachable warrants issued - - - - 152,125 - - 152,125
Detachable warrants exercised 100,000 100 - 148,900 (149,000) - - -
Debentures converted to stock 1,682,447 1,682 - 640,438 - - - 642,120

Net loss - - - - - - (1,671,255) (1,671,255)
----------- -------- ---------- ---------- ----------- ------------ ----------- ----------

December 31, 1999 15,443,909 15,444 111 5,276,478 8,125 - (5,813,678) (513,520)

See accompanying notes to the consolidated financial statements.

F-5

Conversion of parent's shares 128,954 129 (111) (18) - - - -
Shares issued for cash, net
of offering costs 1,575,192 1,575 - 858,460 - - - 860,035
Shares issued in cancellation
of debt 875,000 875 - 660,919 - - - 661,794
Shares issued in cancellation
of accounts payable 100,000 100 - 31,165 - - - 31,265
Shares issued as compensation 3,372,945 3,373 - 2,555,094 - (759,560) - 1,798,907
Warrants exercised 38,807 39 - 3,086 (3,125) - - -
Warrants expired - - - 5,000 (5,000) - - -

Net loss - - - - - - (3,843,308) (3,843,308)
----------- -------- ---------- ---------- ----------- ------------ ----------- -----------

December 31, 2000 21,534,807 21,535 - 9,390,184 - (759,560) (9,656,986) (1,004,827)

Shares issued for cash, net
of offering costs 6,497,088 6,497 - 1,257,758 - - - 1,264,255
Shares issued as compensation 9,162,197 9,162 - 1,558,599 - (230,512) - 1,337,249
Shares issued on previously
purchased shares 342,607 342 - 188,208 - - - 188,550
Shares issued in cancellation
of accounts payable 200,000 200 - 68,880 - - - 69,080
Amortization of deferred
compensation - - - - - 495,036 - 495,036
Stock options issued for services - - - 439,544 - - - 439,544

Net loss - - - - - - (4,079,806) (4,079,806)
----------- -------- ---------- ---------- ----------- ------------ ----------- -----------
December 31, 2001 37,736,699 37,736 - 12,903,173 - (495,036) (13,736,792) (1,290,919)

Shares issued for cash, net
of offering costs 18,657,500 18,658 - 2,077,641 - - - 2,096,299
Shares issued as compensation 3,840,525 3,841 - 1,044,185 - - - 1,048,026
Shares issued on previously
purchased shares 50,000 50 - 4,950 - - - 5,000
Shares issued in cancellation
of accounts payable 4,265,184 4,265 - 539,291 - - - 543,556
Amortization of deferred
compensation - - - - - 495,036 - 495,036
Stock options issued for servies - - - 225,000 - - - 225,000
Net loss - - - - - - (4,057,153) (4,057,153)
----------- -------- ---------- ---------- ----------- ------------ ----------- -----------
December 31, 2002 64,549,908 $ 64,550 $ - $16,794,240 $ - $ - $(17,793,945) $ (935,155)
=========== ======== ========== ========== =========== ============ =========== ===========

See accompanying notes to the consolidated financial statements.

F-6

SAMARITAN PHARMACEUTICALS, INC.

(A DEVELOPMENT STAGE COMPANY)

CONSOLIDATED STATEMENTS OF CASH FLOWS

FROM INCEPTION (SEPTEMBER 5, 1994) AND FOR THE YEARS
ENDED DECEMBER 31, 2002 AND 2001

From To
Inception Years Ended
(September 5, 1994) Ended
To December 31,
CASH FLOWS FROM OPERATING ACTIVITIES: DECEMBER 31, 2002 2002 2001
----------------- ----- -----

Net loss $ (17,793,945) $ (4,057,153) $ (4,079,806)
Adjustments to reconcile net loss to net cash used in
operating activities:
Depreciation and amortization 105,839 25,347 21,080
Expenses paid through issuance of stock 6,475,364 1,048,026 1,337,249
Stock options issued for services 664,544 225,000 439,544
Amortization of deferred compensation 990,072 495,036 495,036
(Increase) decrease in assets:
Prepaids and other current assets (16,241) 17,284 (18,000)
Increase (decrease) in liabilities:
Deferred revenue 250,000 - -
Accounts payable and accrued expenses 1,735,600 221,440 452,296
----------------------- ---------------- ----------------
NET CASH USED IN OPERATING ACTIVITIES (7,588,767) (2,025,020) (1,352,601)
----------------------- ---------------- ----------------

CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of technology (108,969) - -
Purchase of furniture and equipment (84,745) (19,676) -
Patent registration costs (206,785) (1,700) (115,006)
----------------------- ---------------- ----------------
NET CASH USED IN INVESTING ACTIVITIES (400,499) (21,376) (115,006)
----------------------- ---------------- ----------------

CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from warrants 157,125 - -
Proceeds from debentures 642,120 - -
Proceeds from stock issued for cash 5,883,913 2,105,087 1,264,255
Common stock to be issued 193,550 - 5,000
Offering costs (11,071) (8,787) (1,234)
Short-term loan repayments (131,467) (131,467) -
Short-term loan proceeds 1,612,922 135,022 315,900
----------------------- ---------------- ----------------
NET CASH PROVIDED BY FINANCING ACTIVITIES 8,347,092 2,099,855 1,583,921

CHANGE IN CASH 357,826 53,459 116,314
CASH AT BEGINNING OF PERIOD - 304,367 187,853
----------------------- ---------------- ----------------
CASH AT END OF PERIOD $ 357,826 $ 357,826 $ 304,167
======================= ================ ================

NON-CASH FINANCING & INVESTING ACTIVITIES:

Purchase of net, non-cash assets of subsidiary
for stock $ 195 $ - $ -
Short-term debt and accounts payarble retired through
issuance of stock $ 2,433,735 $ 543,556 $ 69,080
Issuance of common stock, previously subscribed $ 5,000 $ 5,000 $ 188,550

See accompanying notes to the consolidated financial statements

F-7

SAMARITAN PHARMACEUTICALS, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 31, 2002 AND 2001

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

A. The Company Samaritan Pharmaceuticals, Inc. (sometimes the "Company" or
"Samaritan") was formed in March 1996 and became public in October 1997. It was
named Samaritan Pharmaceuticals in April 2001 to reflect a change in the charter
and strategic focus of its business.

Samaritan Pharmaceuticals is an emerging product-driven biopharmaceuticals
company. Samaritan is dedicated to saving lives by focusing on the development
of unique therapeutic products for Alzheimer's, Aging Related Disorders, Cancer,
Cholesterol Reduction, HIV, and Parkinson's disease. Samaritan has an emerging
pipeline, with one drug candidate Anticort completing Phase II, two Predictive
Medicine Diagnostics and several preclinical drug candidates. Samaritan's
collaboration with Georgetown University is designed to accelerate discovery and
the development of new products through the "proof of concept" phase and expand
Samaritan's intellectual property coverage for proven drug candidates.

The accompanying financial statements have been prepared on the basis that the
Company will continue as a going concern, which contemplates the realization of
assets and the satisfaction of liabilities in the normal course of business. The
Company has incurred a loss since inception of $17,793,945. As such, the
financial statements reflect recurring losses, working capital deficiencies,
negative cash flows from operating activities, and adverse key financial ratios.
The Company is dependent upon outside capital to continue in existence and to
achieve profitable operations.

Management's plans for dealing with the adverse effects of the conditions cited
above is to raise working capital through equity financing arrangements and
private placements.

Furthermore, management notes that many expenditures can be deferred until funds
are available to continue development. While such a strategy would not be
preferred due to a competitive market, management is willing to pursue it if
necessary.

B. Basis of Consolidation

The accompanying financial statements include the accounts of the Company and
its subsidiary. All intercompany balances and transactions have been eliminated
in consolidation.

C. Property and Equipment

Property and equipment are recorded at cost. Depreciation is provided using the
straight line method over the estimated useful lives of the assets.

D. Intangibles

1) Legal fees associated with filing patents are recorded at cost. Amortization,
once the patent is approved, will be calculated using the straight-line method,
over the estimated useful lives of the patents. Because a substantial amount of
patents were not approved at December 31, 2002, no amortization was recorded for
2002 and 2001. The Company has 1 issued U.S. patent and had 8 pending patent
applications in the U.S. to protect its proprietary methods and processes. The
Company also filed corresponding foreign patent applications for certain of
these U.S. patent applications. As of July 22, 2003, its patent portfolio
outside the U.S. comprised of no issued patents and over 8 pending patent
applications. The issued U.S. patent and pending patent application relate to
Alzheimer's, Cancer, Cardiovascular, and HIV indications and is based on
balancing and modulating the stress hormone cortisol, counteracting cortisol's
neurodegenerative and immunosuppressive properties. The patent on PROCAINE
issued on September 1990, and expires in September 2008 but patent term
extensions under the Hatch-Waxman Act may be available to Samaritan for the lost
opportunity to market and sell the invention during the regulatory review
process.

2) Purchased technology rights are recorded at cost and are being amortized
using the straight line method over the estimated useful life of the technology.
Amortization was approximately $10,896 and $10,896 for the years ended December
31, 2002 and 2001. Accumulated amortization at December 31,2002 was $56,298.

F-8

E. Earnings (loss) per share

The Company reports loss per common share in accordance with Statement of
Financial Accounting Standards ("SFAS") no. 128, "Earnings Per Share."
Generally, the per share effects of potential common shares such as warrants,
options, convertible debt and convertible preferred stock have not been
included, as the effect would be antidilutive.

F. 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 revenue and expenses during the reporting period. Actual
results could differ from those estimates.

G. Income Taxes

Pursuant to Statement of Financial Accounting Standards No. 109 ("SFAS 109")
"Accounting for Income Taxes", the Company accounts for income taxes under the
liability method. Under the liability method, a deferred tax asset or liability
is determined based upon the tax effect of the differences between the financial
statement and tax basis of assets and liabilities as measured by the enacted
rates which will be in effect when these differences reverse.

H. Research and Development Costs

Research and development costs are expensed when incurred.

I. Impairment of Long-Lived Assets

The Company reviews long-lived assets and certain identifiable assets related to
those on a quarterly basis for impairment whenever circumstances and situations
change such that there is an indication that the carrying amounts may not be
recovered. At December 31, 2002, the Company does not believe that any
impairment has occurred.

J. Fair Value of Financial Instruments

Statement of Financial Accounting Standard No. 107 "Disclosures about Fair Value
of Financial Instruments" (SFAS 107) requires the disclosure of fair value
information about financial instruments whether or not recognized on the balance
sheet, for which it is practicable to estimate the value. Where quoted market
prices are not readily available, fair values are based on quoted market prices
of comparable instruments. The carrying amount of cash, accounts payable and
accrued expenses approximates fair value because of the short maturity of those
instruments.

F-9

K. Stock Based Compensation

Statement of Financial Accounting Standards No. 123, "Accounting for Stock-Based
Compensation," ("SFAS 123"), encourages, but does not require, companies to
record compensation cost for stock-based employee compensation plans at fair
value. The Company has chosen to account for stock-based compensation using the
intrinsic value method prescribed in Accounting Principles Board Opinion No. 25,
"Accounting for Stock Issued to Employees", and related Interpretations.
Accordingly, compensation cost for the Company's stock at the date of the grant
over the amount of an employee must pay to acquire the stock. The Company has
adopted the "disclosure only" alternative described in SFAS 123 and SFAS 148,
which require pro forma disclosures of net income and earnings per share as if
the fair value method of accounting had been applied.

L. New Accounting Pronouncements

In August 2001, the FASB issued SFAS No. 143, "Accounting for Asset Retirement
Obligations." The standard requires entities to record the fair value of a
liability for an asset retirement obligation in the period in which it is
incurred. When the liability is initially recorded, the entity capitalizes a
cost by increasing the carrying amount of the related long-lived asset. Over
time, the liability is accreted to its present value each period, and the
capitalized cost is depreciated over the useful life of the related asset. Upon
settlement of the liability, an entity either settles the obligation for its
recorded amount or incurs a gain or loss upon settlement. The standard is
effective for fiscal years beginning after June 15, 2002. The adoption of SFAS
No. 143 is not expected to have a material impact on the Company's consolidated
financial statements.

In July 2002, the FASB issued Statement No. 146 (SFAS 146), "Accounting for
Costs Associated with Exit or Disposal Activities." This Standard supercedes the
accounting guidance provided by Emerging Issues Task Force Issue No. 94-3,
"Liability Recognition for Certain Employee Termination Benefits and Other Costs
to Exit an Activity" (including "Certain Costs Incurred in a Restructuring").
SFAS No. 146 requires companies to recognize costs associated with exit
activities when they are incurred rather than at the date of a commitment to an
exit or disposal plan. SFAS No. 146 is to be applied prospectively to exit or
disposal activities initiated after December 31, 2002. The Company is currently
evaluating this Standard.

In December 2002, the FASB issued SFAS No. 148, "Accounting for Stock-Based
Compensation -- Transition and Disclosure -- an Amendment of FASB Statement No.
123." SFAS No. 148 provides alternative methods of transition for a voluntary
change to the fair value based method of accounting for stock-based employee
compensation. The Company does not currently intend to adopt the fair value
based method of measuring compensation associated with stock awards and grants.
As a consequence of continuing to utilize the intrinsic value method of
measuring such compensation, the Company will be required to provide additional
disclosures in its quarterly financial statements which will reflect the impact
on net income and earnings per share on a pro forma basis as if the Company had
applied the fair value method to stock-based employee compensation.

F-10

2. PROPERTY AND EQUIPMENT

Property and equipment, at cost, consist of the following as of December 31,
2002:

Estimated Useful Life
(Years)
-----------------------
Furniture and Fixtures 5-7 $ 84,745
Accumulated depreciation (49,540)
-------------
$ 35,205
=============
3. SHORT-TERM BORROWINGS

On October 5, 2001 the Company issued a note for $237,302. The note is payable
on demand and bears interest at 12% per annum. The note had a balance of
$120,834 at December 31, 2002.

At December 31, 2002 the Company had an amount due to an entity for $36,121.
This loan is unsecured, due on demand and does not accrue interest.

4. DEFERRED REVENUE

Steroidogenesis Inhibitors, Inc, (S.I.), a subsidiary of Samaritan
Pharmaceuticals, received $250,000 from Steroidogenesis Inhibitors Canada, Inc.,
(SI- Canada) for a licensing agreement that is not valid. S.I. also has notified
S.I. Canada to discontinue conducting any business to the extent it in involves
using the technology purported to be licensed under the agreement. Samaritan has
sent notice of the invalidity of the licensing agreement to S.I.- Canada. To
date, no response has been received from S.I. Canada to the confirm the
invalidity of the licensing agreement between S.I. and S.I. Canada.

5. SHAREHOLDERS' DEFICIT

On April 24, 2001, the Company amended its articles of incorporation to increase
the authorized number of shares to 100 million and to authorize a class of 5
million shares of preferred stock.

A. Stock Option Plan

The Company has a stock option plan (Samaritan Pharmaceuticals 2001 Stock Option
Plan). There were 5,074,858 options granted and 2,586,192 options remaining
pursuant to the plan as of December 31, 2002.

B Options Outstanding

The following table summarizes the Company's stock options outstanding at
December 31, 2002:

Weighted
Average
Shares Exercise Price
------------ --------------
Outstanding and exercisable at
December 31, 2000 - $ -

Granted 5,418,615 .55

Exercised and expired - -

Outstanding and exercisable at
December 31, 2001 --------------- ---------------
5,418,615 .55

Granted 5,317,841 .20

Expired (1,742,248) (1.05)
--------------- ---------------
Outstanding and exercisable at
December 31, 2002 8,994,208 $ .25
=============== ===============

F-11

The Company applies APB No. 25, "Accounting for Stock Issued to Employees," and
related interpretations in accounting for its stock options including those
options /warrants issued to officers under their employment agreement. As a
result no compensation expense has been recognized for employee and director
stock options. Had the Company determined compensation cost based on the fair
value at the grant date for its stock options under SFAS No. 123, "Accounting
for Stock-Based Compensation," the Company's net loss would have been reported
as follows:

December 31,
2002 2001
------------- -------------
Net Loss:

As reported $ (4,057,153) $ (4,079,806)
Pro Forma $ (4,924,153) $ (4,407,806)

Basic and diluted loss per common share:
As reported $ (0.08) $ (0.17)
Pro Forma $ (0.10) $ (0.18)

The Company utilizes the Black-Scholes option-pricing model to calculate the
fair value of each individual issuance of options with the following assumptions
used for grants during the year ended December 31, 2002 and 2001. The per-share
weighted average fair value of stock options granted during 2002 was $0.18 on
the date of grant using the Black Scholes pricing model and the following
assumptions for the year ended December 31, 2002:

Expected dividend yield 0%
Risk-free interest rate 5.0%
Annualized volatility 150%

F-12

At December 31, 2002 the range of exercise price for all of the Company's
outstanding stock options was $.10-$3.50, with an average remaining life of 6.3
years and an average exercise price of $.25.

C. Stock as compensation and settlement of debt

The Company issues stock as compensation for services and supplies, valuing such
issues premised upon the fair market value of the stock or the services,
whichever is more clearly determinable.

During the year ended December 31, 2001, the Company issued an aggregate of
9,162,917 shares of common stock in consideration of services rendered or to be
rendered to the Company and accrued salaries . Such shares were valued at an
aggregate of $1,567,761 ranging from $.29-$.50 per share, representing the fair
value of the shares issued. The issuances were recorded as $230,512 of deferred
compensation and the balance of $1,337,249 as non-cash compensation expense.
During the year ended December 31, 2001 the Company exchanged 542,607 shares of
the Company's common stock in settlement of indebtedness.

During the year ended December 31, 2002, the Company issued an aggregate of
3,840,525 shares of common stock in consideration of services rendered or to be
rendered to the Company. Such shares were valued at an aggregate of $1,048,026
ranging from $.17-$.25 per share, representing the fair value of the shares
issued. The issuances were recorded as non-cash compensation expense. During the
year ended December 31, 2002 the Company exchanged 4,265,184 shares of the
Company's common stock in settlement of accounts payable.

6. INCOME TAXES

The Company follows Statement of Financial Accounting Standards No. 109 -
Accounting for Income Taxes, which requires recognition of deferred tax assets
and liabilities for the expected future tax consequences of events that have
been included in the financial statements or tax returns. Under this method,
deferred tax assets and liabilities are based on the differences between the
financial statement and tax bases of assets and liabilities using enacted tax
rates in effect for the year in which the differences are expected to reverse.

The Company has net operating loss at December 31, 2002 of approximately
$14,000,000 expiring through 2017.

Deferred income tax assets as of December 31, 2002 of $4,700,000 as a result of
net operating losses, have been fully offset by valuation allowances. The
valuation allowances have been established equal to the full amounts of the
deferred tax assets, as the Company is not assured that it is more likely than
not that these benefits will be realized.

A reconciliation of the statutory U.S. Federal rate and effective rates is as
follows:

Years Ended December 31,
------------------------
2002 2001
------- ------

Tax Benefit Computed at Statutory Rates (35%) (35%)
Income Tax Benefit Not Utilized 35% 35%
------- ------
Net Income Tax Benefit - -
======= ======

F-13

7. COMMITMENTS AND CONTINGENCIES

A. The Company leases various facilities under operating lease agreements
expiring through April 2005. Rental expense for the year ended December 31, 2002
was $38,769. Future minimum annual lease payments under the facilities lease
agreements for agreements lasting more than one year are as follows:

2003 $ 32,080
2004 $ 33,040
2005 $ 11,120

B. On June 8, 2001 the Company signed a seven year research collaboration and
licensing agreement with Georgetown University ("Georgetown"). The agreement
commenced July 1, 2001 and terminates June 30, 2008. As consideration for
Georgetown's performance under this Agreement the Company shall pay Georgetown
$650,000 per year in quarterly installments commencing with the quarter ended
September 30, 2001. As of December 31, 2002 the Company has incurred costs of
$990,322 which has been recorded as research and development expense in the
Company's financial statements.

C. The Company has entered into employment agreements with three officers. Two
agreements started January 1, 2001 and the third commenced April 1, 2001. Two
agreements are for five years and one agreement is for two years with annual
compensation for all three at $780,000 with an annual increase not less than 5%
per year. Each officer at his option can receive payment in Company common stock
calculated at the lowest closing price of the stock quoted for the period for
which the salary has been earned divided by the current discount rate for
restricted stock offered by the Company.

Each officer is entitled to a bonus payable in ten year warrants based on a
calculation of the Company's market capitalization. In addition each officer is
guaranteed annual incentive stock options of the greater of 250,000 or a
percentage of the issued and outstanding shares on the anniversary date of the
agreement. The percentage ranges from 1% to 4%. Such options vest 25% each
quarter and are priced at the lowest closing price of the Company's common stock
in the quarter preceding the grant. The options terminate after ten years.

8. LITIGATION

Samaritan, from time to time, is involved in various legal proceedings in the
ordinary course of our business and are currently executing a settlement
agreement signed by all parties to resolve previously reported pending lawsuits.
Samaritan believes, based on the settlement agreement, that the resolution of
any currently pending legal proceedings, either individually or taken as a
whole, will not have a material adverse effect on its business, financial
condition or results of operations.

F-14

9. FUSION TRANSACTION

On November 13, 2000, Samaritan entered into a stock purchase agreement with
Fusion Capital Fund II, LLC, ("Fusion") pursuant to which Fusion Capital agreed
to purchase up to $10 million of the Company's common stock over a 25 month
period from January 17, 2001, which period may be extended an additional three
months at the Company's discretion. Subject to the limits on purchase and the
termination rights described below during each month, Fusion Capital shall
purchase up to $400,000 of the Company's common stock. The obligation of Fusion
Capital to purchase each month is subject to customary conditions, all of which
are outside the control of Fusion Capital as well as the Company's right to
suspend purchases described below. At such time as Fusion Capital purchases
$10,000,000 of the Company's common stock, the Company, at its discretion, may
elect to enter into an additional $10,000,000 common stock purchase agreement.
This amount may be increased or decreased by Samaritan. The selling price per
share is equal to the lowest of (a) the lowest sale price of the common stock on
the day of submission of a purchase notice by Fusion Capital; or (b) the average
of the three lowest closing sale prices of the common stock during the 15
trading days prior to the date of submission of a purchase notice by Fusion
Capital; or (c) $20.00. As of January, 2000, the Company elected to enter into
such additional $10,000,000 for a total of $20,000,000. The selling price will
be adjusted for any reorganization, recapitalization, non-cash dividend, stock
split or other similar transaction occurring during the 15 trading days in which
the closing sale price is used to compute the purchase price. Notwithstanding
the foregoing, Fusion Capital may not purchase shares of common stock under the
stock purchase agreement if Fusion Capital or its affiliates would beneficially
own more than 4.99% of the then aggregate outstanding common stock immediately
after the proposed purchase.

If the closing sale price of the Company's common stock is below $20.00, the
Company has the unconditional right to suspend purchases until the earlier of
(1) our revocation of such suspension and (2) such time as the sale price of our
common stock is above $20.00.

If the closing sales price of the Company's common stock on each of the five
trading days immediately prior to the first trading day of any monthly period is
at least $5.00, the Company has the right to require that Fusion purchase all or
a portion of the remaining amount of the stock purchase agreement during the
next two monthly periods. If the closing sale price of the Company's common
stock is below $20.00 for any 10 consecutive trading days, then the Company may
elect to terminate the stock purchase agreement without any liability or payment
to Fusion.

Under the terms of the stock purchase agreement, Fusion Capital received
1,054,945 shares of common stock on November 6, 2000.

In connection with this agreement, the Company agreed to pay to consultants
200,000 warrants exercisable for the Company's common stock. The warrants were
issuable upon the initial funding by Fusion.

During the year ended December 31, 2002 pursuant to the agreement, Fusion
purchased 5,170,000 shares for $756,337. At December 31, 2002, Fusion had
advanced additional funds of $162,500 to be repaid through additional issuances
subsequent to year end. The amount advanced is reflected as short-term
borrowings in the accompanying financial statements.

10. RISKS AND UNCERTAINTIES

Marketability of the product is dependent, among other things, upon securing
additional capital to successfully complete the clinical testing of the product,
securing FDA approval, and procurement of viable patents.

F-15

PART II -- 6

PART II
INFORMATION NOT REQUIRED IN PROSPECTUS

Item 24. Indemnification of Directors and Officers.

None of our directors will have personal liability to us or any of our
stockholders for monetary damages for breach of fiduciary duty as a director
involving any act or omission of any such director since provisions have been
made in the Articles of Incorporation limiting such liability. The foregoing
provisions shall not eliminate or limit the liability of a director (i) for any
breach of the director's duty of loyalty to us or our stockholders, (ii) for
acts or omissions not in good faith or, which involve intentional misconduct or
a knowing violation of law, (iii) under applicable Sections of the Nevada
Revised Statutes, (iv) the payment of dividends in violation of Section 78.300
of the Nevada Revised Statutes or, (v) for any transaction from which the
director derived an improper personal benefit.

The Bylaws provide for indemnification of the directors, officers, and employees
of Samaritan Pharmaceuticals, Inc. in most cases for any liability suffered by
them or arising out of their activities as directors, officers, and employees of
Samaritan Pharmaceuticals, Inc. if they were not engaged in willful misfeasance
or malfeasance in the performance of his or her duties; provided that in the
event of a settlement the indemnification will apply only when the board of
directors approves such settlement and reimbursement as being for the best
interests of the Corporation. The Bylaws, therefore, limit the liability of
directors to the maximum extent permitted by Nevada law (Section 78.751).

Our officers and directors are accountable to us as fiduciaries, which mean they
are required to exercise good faith and fairness in all dealings affecting us.
In the event that a stockholder believes the officers and/or directors have
violated their fiduciary duties to us, the stockholder may, subject to
applicable rules of civil procedure, be able to bring a class action or
derivative suit to enforce the stockholder's rights, including rights under
certain federal and state securities laws and regulations to recover damages
from and require an accounting by management. Stockholders who have suffered
losses in connection with the purchase or sale of their interest in Samaritan
Pharmaceuticals, Inc. in connection with such sale or purchase, including the
misapplication by any such officer or director of the proceeds from the sale of
these securities, may be able to recover such losses from us.

The Company has entered into indemnification agreements with each of its
directors and officers, indemnifying them against expenses, settlements,
judgments and fines incurred in connection with any threatened, pending or
completed action, suit, arbitration or proceeding, where the individual's
involvement is by reason of the fact that he or she is or was a director or
officer or served at our request as a director of another organization (except
that indemnification is not provided against judgments and fines in a derivative
suit unless permitted by Nevada law.) An individual may not be indemnified if he
or she is found not to have acted in good faith and in a manner he or she
reasonably believed to be in or not opposed to the best interests of Samaritan
Pharmaceuticals, except to the extent Nevada law shall permit broader
contractual indemnification. The indemnification agreements provide procedures,
presumptions and remedies designed to substantially strengthen the indemnity
rights beyond those provided by Samaritan Pharmaceutical's Certificate of
Incorporation and by Nevada law.

Commission Position of Indemnification for Securities Act Liabilities

Insofar as indemnification for liabilities arising under the Securities Act of
1933 (the "Act") may be permitted to directors, officers and controlling persons
of the Company, Samaritan Pharmaceuticals, Inc. has been advised that in the
opinion of the Securities and Exchange Commission such indemnification is
against public policy as expressed in the Act and is therefore, unenforceable.

PART II-- 1

Item 25. Other Expenses of Issuance and Distribution.

The following table sets forth the expenses (other than the underwriting
discounts and commissions and the Underwriter's Non-Accountable Expense
Allowance) expected to be incurred in connection with the issuance and
distribution of the securities being registered.

SEC Registration............................... $ 227.28
Legal Fees and Expenses*....................... $ 5,000.00
Accounting Fees*............................... $ 5,000.00
Miscellaneous*................................. $ 2,000.00
===========
Total...........................................$ 12,227.28

------------------
* Estimated

Item 26. Recent Sales of Unregistered Securities

The following sets forth securities sold by the Company in the recent past,
including any during the period covered by this registration statement. These
securities were shares of Common Stock of the Company, they were sold for cash
unless otherwise noted, they were sold in private transactions to persons
believed to be of a class of "accredited investors" not affiliated with the
Company unless otherwise noted, and purchasing the shares with an investment
intent, and the Company relied upon, among other possible exemptions, Section
4(2) of the Securities Act of 1933, as amended. It's reliance on said exemption
was based upon the fact that no public solicitation was used by the Company in
the offer or sale, and that the securities were legend shares, along with a
notation at the respective transfer agent, restricting the shares from sale or
transfer as in customary with reference to Rule 144 of the U.S. Securities and
Exchange Commission ("SEC").

During the period from 4-01-2000 ended 6-30-00, the Company issued an aggregate
of 783,000 restricted shares of common stock for an aggregate valuation of
$341,706 to various consultants, in consideration of services rendered or to be
rendered to the Company. Also during this same time period the company issued an
additional 750,000 restricted shares of common stock for an aggregate valuation
of $168,531 in the retirement of debt.

During the period from 10-01-2000 ended 12-31-2000, the Company issued an
aggregate of 875,000 restricted shares of common stock for an aggregate
valuation of $418,371 in the settlement of debt. Also, during the same period,
the Company completed a Regulation D placement "Stein Morgan" in which the
Company issued an aggregate of 943,315 shares of restricted common stock for an
aggregate valuation of $637,400.

During the period from 1-01-2001 ended 3-31-01, the Company issued an aggregate
of 658,918 restricted shares of common stock for an aggregate valuation of
$62,752 of various consultants, in consideration of services rendered or to be
rendered to the Company.

During the period from 4-01-2001 ended 6-01-2001, the Company issued an
aggregate of 1,362,909 restricted shares of common stock for an aggregate
valuation of $492,167 of various consultants, in consideration of services
rendered or to be rendered to the Company.

During the period from 7-01-2001 ended 9-30-2001 Company completed a Regulation
D placement "2001 Common Stock Private Placement", the Company issued an
aggregate of 1,210,000 shares of restricted common stock for an aggregate
valuation of $302,500. Also, during the same period, the Company issued an
aggregate of 2,111,650 restricted shares of common stock for an aggregate
valuation of $692,882 of various consultants, in consideration of services
rendered or to be rendered to the Company.

PART II -- 2

During the period from 10-01-2001 ended 12-31-2001, the Company issued an
aggregate of 150,000 restricted shares of common stock for an aggregate
valuation of $15,000 of various consultants, in consideration of services
rendered or to be rendered to the Company. During the same period, the Company
issued an aggregate of 4,795,415 restricted shares of common stock for an
aggregate valuation of $479,541 for the Samaritan Pharmaceuticals Executive
Benefit Plan. The Company issued an aggregate of 2,300,000 restricted shares of
common stock for an aggregate valuation of $230,000 upon the approval of
Proposal 3 at the shareholders meeting. Also, within the period from 11-01-2001
ended 12-10-01, the Company completed a Regulation D placement "2001 November
Common Stock Private Placement", the Company issued an aggregate of 2,000,000
shares of restricted common stock for an aggregate valuation of $200,000.

During the period from 12-12-2001 ended 2-10-2002, the Company completed a
Regulation D placement "2001 December Common Stock Private placement"; the
Company issued an aggregate of 3,981,000 shares of restricted common stock for
an aggregate valuation of $398,100

During the period from 1-01-2002 ended 3-31-2002, the Company issued an
aggregate of 420,483 restricted shares of common stock for an aggregate
valuation of $65,553 of various consultants, in consideration of services
rendered or to be rendered to the Company. During the same period, the Company
issued an aggregate of 1,036,422 restricted shares of common stock for an
aggregate valuation of $161,576 for the settlement of accounts payable. The
Company issued an aggregate of 635,555 restricted shares of common stock for an
aggregate valuation of $103,241 to 3rd party vendors converted shares in lieu of
cash , the Company issued an aggregate of 821,350 restricted shares of common
stock for a aggregate valuation of $123,888 for the Samaritan Pharmaceuticals
Executive Benefit Plan.

During the period from 3-01-2002 ended 9-10-2002, the Company completed a
Regulation D placement "2002 April Common Stock Private Placement", the Company
issued an aggregate of 7,865,000 shares of restricted common stock for an
aggregate valuation of $786,500.

During the period from 4-01-2002 ended 6-30-2002, the Company issued an
aggregate of 3,479,629 restricted shares of common stock for an aggregate
valuation of $477,100 for the settlement of accounts payable of the Company.

During the period from 7-01-2002 ended 9-30-2002, the Company issued an
aggregate of 211,518 restricted shares of common stock for a aggregate valuation
of $21,151.80 of various consultants, in consideration of services rendered or
to be rendered to the Company, the Company issued an aggregate of 2,957,657
restricted shares of common stock for a aggregate valuation of $408,903 for the
Samaritan Pharmaceuticals Executive Benefit Plan.

During the period from 9-15-2002 ended 12-31-2002, the Company completed a
Regulation D placement "Private Placement #4 2002", the Company issued an
aggregate of 2,412,500 shares of restricted common stock for an aggregate
valuation of $241,250.

During the period from 1-01-2003 ended 5-28-2003, the Company completed a
Regulation D placement "Private Placement #5 2003", the Company issued an
aggregate of 7,077,000 shares of restricted common stock for an aggregate
valuation of $707,700.

During the period from 4-01-2003 ended 5-28-2003, the Company issued an
aggregate of 56,818 restricted shares of common stock for an aggregate valuation
of $10,000 of various consultants, in consideration of services rendered or to
be rendered to the Company.

PART II -- 3

Item 27. Exhibits.

Listed below are all exhibits filed as part of this report. Some exhibits are
filed by the Registrant with the Securities and Exchange Commission pursuant to
Rule 12b-32 under the Securities Exchange Act of 1934, as amended.

Exhibits
No. Description
----------------------------------------------------------------------
2.1 Agreement and Plan of Reorganization (1)
3.1 Articles of Incorporation, as amended and restated *
3.2 By-laws (3)
4.1 Form of common stock certificate (1)
4.2 2001 Stock Option Plan (4)
5.1 Opinion on legality (7)
10.1 Assignment between Linda Johnson and the Company dated September 6,
2000. (5)
10.2 Assignment between Linda Johnson and Spectrum Pharmaceuticals
Corporation dated May 14, 1999. (5)
10.3 Agreement containing the assignment of U.S. Patent Application
07/233,247 with improvements dated May 22, 1990. (5)
10.4 Agreement between AIDS Research Alliance Agreement and the Company
dated March 5, 1999 (1)
10.5 Common Stock Purchase Agreement between Company and Fusion Capital Fund
II, LLC, dated April 22, 2003 (2)
10.6 Registration Rights Agreement between Company and Fusion Capital Fund
II, LLC dated April 22, 2003. (2)
10.7 Agreement between Samaritan Pharmaceuticals, Inc. and Doug Bessert (5)
10.8 Agreement between Samaritan Pharmaceuticals, Inc. and Eugene Boyle (5)
10.9 Agreement between Samaritan Pharmaceuticals, Inc and Janet Greeson (5)
10.10 Research Collaboration and Licensing Agreement between Georgetown
University and Samaritan Pharmaceuticals, Inc.,
dated June 8, 2001 *
16.1 Letter on change in certifying accountant (6)
21.1 List of Subsidiaries (7)
23.1 Consent of Experts and Counsel -- Consent of Counsel (included in
Exhibit 5.1)
23.2 Consent of Experts and Counsel -- Consent of Accountant *
------------------------------------------
* Filed herewith
(1) Filed as an exhibit to Samaritan Pharmaceutical's Form 10-SB, filed
on July 21, 1999, and incorporated herein by reference.
(2) Filed as an exhibit to Samaritan Pharmaceutical's Report on Form
8-K filed on April 25, 2003, and incorporated herein by reference.
(3) Filed as an exhibit to Samaritan Pharmaceutical's Annual Report on Form
10K-SB, filed on April 3, 2001, and incorporated herein by reference.
(4) Filed as an exhibit to Samaritan Pharmaceutical's Schedule 14A filed
on April 3, 2001, and incorporated herein by reference
(5) Filed as an exhibit to Samaritan Pharmaceutical's Quarterly Report
on Form 10-QSB filed on August 14, 2002, and incorporated herein by
reference.
(6) Filed as an exhibit to Samaritan Pharmaceutical's Report on Form 8-K
filed on September 27, 2002, and incorporated herein by reference.
(7) Previously filed.

PART II -- 4

Item 28. Undertakings.

The undersigned hereby undertakes:

(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this Registration Statement:

(i) To include any prospectus required by section 10(a)(3) of the
Securities Act of 1933;

(ii) To reflect in the prospectus any facts or events which, individually
or in the aggregate, represent a fundamental change in the information
set forth in the registration statement. Notwithstanding the foregoing,
any increase or decrease in volume of securities offered (if the total
dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the estimated
maximum offering range may be reflected in the form of prospectus filed
with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than a 20% change in the
maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration statement; and

(iii) To include any additional or changed material information on the plan
of distribution.

(2) That, for the purpose of determining any liability under the Securities Act
of 1933, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.

(3) To file a post-effective amendment to remove from registration any of the
securities that remain unsold at the end of the offering.

Insofar as indemnification for liabilities arising under the Securities Act of
1933 may be permitted to the registrant's directors, officers, and controlling
persons pursuant to the foregoing provisions, or otherwise, the registrant has
been advised that in the opinion of the Commission such indemnification is
against public policy as expressed in the Securities Act and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by the registrant of expenses incurred or
paid by a directors, officers or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer, or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of counsel the matter has
been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.

PART II -- 5

Signatures

In accordance with the requirements of the Securities Act of 1933, as amended,
the registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements of filing on Form SB-2 and authorized this registration
statement to be signed on its behalf by the undersigned in the City of Las
Vegas, Nevada, on July 30, 2003.

Samaritan Pharmaceuticals, Inc.

By: /s/ Dr. Janet Greeson
----------------------------
Janet Greeson, Ph.D. Chief
Executive Officer

In accordance with the requirements of the Securities Act of 1933, this
Amendment No. 1 to Registration Statement was signed by the following persons in
the capacities and on the dates indicated:

Signature Title Date

/s/ Janet Greeson Chief Executive Officer July 30, 2003
--------------------------------- and Director
Janet Greeson, Ph.D. (principal executive officer)

/s/ Eugene Boyle Chief Financial Officer July 30, 2003
--------------------------------- and Director
Eugene Boyle (principal financial officer
and principal accounting
officer)

/s/ Welter Holden Director July 30, 2003
---------------------------------
Welter Holden

/s/ J Doug Bessert Director July 30, 2003
---------------------------------
Doug Bessert

/s/ Cynthia Thompson Director July 30, 2003
---------------------------------
Cynthia Thompson

/s/ H. Thomas Winn Director July 30, 2003
---------------------------------
H. Thomas Winn

/s/ Brian Sullivan Director July 30, 2003
---------------------------------
Brian Sullivan

/s/ Vassilios Papadopoulos, Ph.D. Director July 30, 2003
---------------------------------
Vassilios Papadopoulos, Ph.D.

/s/ Dr. Erasto R. Saldi Director July 30, 2003
---------------------------
Dr. Erasto R. Saldi

PART II -- 6

INDEX OF EXHIBITS

No. Description
----------------------------------------------------------------------
2.1 Agreement and Plan of Reorganization (1)
3.1 Articles of Incorporation, as amended and restated *
3.2 By-laws (3)
4.1 Form of common stock certificate (1)
4.2 2001 Stock Option Plan (4)
5.1 Opinion on legality (7)
10.1 Assignment between Linda Johnson and the Company dated September 6,
2000. (5)
10.2 Assignment between Linda Johnson and Spectrum Pharmaceuticals
Corporation dated May 14, 1999. (5)
10.3 Agreement containing the assignment of U.S. Patent Application
07/233,247 with improvements dated May 22, 1990. (5)
10.4 Agreement between AIDS Research Alliance Agreement and the Company
dated March 5, 1999 (1)
10.5 Common Stock Purchase Agreement between Company and Fusion Capital Fund
II, LLC, dated April 22, 2003 (2)
10.6 Registration Rights Agreement between Company and Fusion Capital Fund
II, LLC dated April 22, 2003. (2)
10.7 Agreement between Samaritan Pharmaceuticals, Inc. and Doug Bessert (5)
10.8 Agreement between Samaritan Pharmaceuticals, Inc. and Eugene Boyle (5)
10.9 Agreement between Samaritan Pharmaceuticals, Inc and Janet Greeson (5)
10.10 Research Collaboration and Licensing Agreement between Georgetown
University and Samaritan Pharmaceuticals, Inc.,
dated June 8, 2001 *
16.1 Letter on change in certifying accountant (6)
21.1 List of Subsidiaries (7)
23.1 Consent of Experts and Counsel -- Consent of Counsel (included in
Exhibit 5.1)
23.2 Consent of Experts and Counsel -- Consent of Accountant *
------------------------------------------
* Filed herewith
(1) Filed as an exhibit to Samaritan Pharmaceutical's Form 10-SB, filed
on July 21, 1999, and incorporated herein by reference.
(2) Filed as an exhibit to Samaritan Pharmaceutical's Report on Form
8-K filed on April 25, 2003, and incorporated herein by reference.
(3) Filed as an exhibit to Samaritan Pharmaceutical's Annual Report on Form
10K-SB, filed on April 3, 2001, and incorporated herein by reference.
(4) Filed as an exhibit to Samaritan Pharmaceutical's Schedule 14A filed
on April 3, 2001, and incorporated herein by reference
(5) Filed as an exhibit to Samaritan Pharmaceutical's Quarterly Report
on Form 10-QSB filed on August 14, 2002, and incorporated herein by
reference.
(6) Filed as an exhibit to Samaritan Pharmaceutical's Report on Form 8-K
filed on September 27, 2002, and incorporated herein by reference.
(7) Previously filed.