- Quarterly Report (10-Q)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

R	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2011

£	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from __________ to ____________

Commission File Number: 333-06718

VIROPRO, INC.
	(Exact name of registrant as specified in its charter)

Nevada		13-3124057
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

4199 Campus Drive, Suite 550, Irvine, CA		92612
(Address of principal executive offices)		(Zip Code)

(949) 783-6573

(Registrant’s telephone number, including area code)

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

Yes £

No R

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Yes £

No R

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “small reporting company” in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer £	Accelerated Filer £
Non-Accelerated Filer £ (Do not check if a smaller reporting company)	Smaller reporting company R

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes £

No R

As of September 30, 2011the number of the Company's shares of par value $.001 common stock outstanding was 915,089,570.

VIROPRO, INC.

FORM 10-Q

September 30, 2011

INDEX

		Page

PART I — FINANCIAL INFORMATION		4
Item 1: Financial Statements		4
	Consolidated Balance Sheets	5
	Consolidated Statements of Operations (Unaudited)	6
	Consolidated Statements of Cash Flows (Unaudited)	10
	Notes to Consolidated Financial Statements	11
Item 2: Management’s Discussion and Analysis of Financial Condition and Results of Operations		29
Item 3: Quantitative and Qualitative Disclosures about Market Risk		29
Item 4: Controls and Procedures		29
PART II — Other Information		31
Item 1: Legal Proceedings		31
Item 2: Unregistered Sales of Equity Securities and Use of Proceeds		31
Item 3: Defaults Upon Senior Securities		31
Item 6: Exhibits		32

VIROPRO, INC.

FORM 10-Q

September 30, 2011

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

The accompanying financial statements have been prepared in accordance with the instructions to Form 10-Q. Therefore, they do not include all information and footnotes necessary for a complete presentation of financial position, results of operations, cash flows, and stockholders’ equity in conformity with generally accepted accounting principles. Except as disclosed herein, there has not been a material change in the information disclosed in the notes to the financial statements included in the Company’s annual report on Form 10-K for the year ended December 31, 2010. These interim financial statements should be read in conjunction with the financial statements and accompanying notes included in such annual report. In the opinion of management, all adjustments considered necessary for a fair presentation of the results of operations and financial position have been included and all such adjustments are of a normal recurring nature. Operating results for the nine months ended September 30, 2011 are not necessarily indicative of the results that can be expected for the year ended December 31, 2011.

VIROPRO, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
SEPTEMBER 30, 2011 AND DECEMBER 31, 2010
(IN US$)

ASSETS

	September 30,			December 31,
	2011			2010
	(unaudited)

CURRENT ASSETS
Cash	$	119,250		$	58,932
Accounts receivable		82,702			103,904
Inventory		50,631			-
Prepaid expenses		38,437			10,000
Total current assets		291,020			172,836

Property and equipment,
net of accumulated depreciation		15,607,911			57,638
Total fixed assets		15,607,911			57,638

Security and other deposits		84,219			5,593
Loans Receivable		10,074			-
Goodwill		22,781,069			1,877,479
Total other assets		22,875,362			1,883,072

TOTAL ASSETS	$	38,774,293		$	2,113,546


LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)

CURRENT LIABILITIES
Accounts payable and accrued expenses	$	2,345,197		$	461,086
Convertible debentures		67,500			100,000
Notes payable		73,556			75,556
Liability for stock to be issued		675,700			20,447
Total current liabilities		3,161,953			657,089

LONG TERM LIABILITIES
Deferred Income		2,547,945			-
Notes Payable		11,908,187			-
Total long term liabilities		14,456,132			-


TOTAL LIABILITIES		17,618,085			657,089

STOCKHOLDERS' EQUITY (DEFICIT)
Common stock, $.001 par value, 1,000,000,000 shares authorized,
915,089,570 and 313,470,570 shares issued and outstanding		915,089			313,470
Additional paid in capital		39,730,309			18,549,836
Subscription receivable		-			(13,000	)
Accumulated deficit		(19,116,775	)		(17,000,035	)
Accumulated other comprehensive income (loss)		(372,415	)		(393,814	)
Total stockholders' equity		21,156,208			1,456,457


TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	38,774,293		$	2,113,546

See notes to the consolidated financial statements.

VIROPRO, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS AND OTHER COMPREHENSIVE LOSS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2011 AND 2010
AND THE THREE MONTHS ENDED SEPTEMBER 30, 2011 AND 2010
(IN US$)

	NINE MONTHS			NINE MONTHS			THREE MONTHS			THREE MONTHS
	ENDED			ENDED			ENDED			ENDED
	SEPTEMBER 30, 2011			SEPTEMBER 30, 2010			SEPTEMBER 30, 2011			SEPTEMBER 30, 2010

REVENUE	$	839,328		$	397,280		$	385,156		$	175,851

OPERATING EXPENSES
Consulting fees		812,526			219,918			113,996			103,023
Selling, general and administrative		1,906,942			1,038,500			1,076,373			235,949
Total operating expenses		2,719,468			1,258,418			1,190,369			338,972

NON-OPERATING INCOME (EXPENSE)
Interest expense		(236,600	)		(12,397	)		(233,600	)		486
Gain (loss) on legal settlement		-						-
Gain on return of shares for services not rendered		-						-
Gain (loss) on sale of assets		-						-
Gain on settlement for conversion of debenture		-						-
Total non-operating expenses		(236,600	)		(12,397	)		(233,600	)		486

NET LOSS	$	(2,116,740	)	$	(873,535	)	$	(1,038,813	)	$	(162,635	)

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)
Net income (loss)	$	(2,116,740	)	$	(873,535	)	$	(1,038,813	)	$	(162,635	)
Foreign currency translation adjustment		21,399			(216,286	)		20,920			(74	)

COMPREHENSIVE INCOME (LOSS)	$	(2,095,341	)	$	(1,089,821	)	$	(1,017,893	)		(162,709	)


EARNINGS (LOSS) PER SHARE
Weighted average shares outstanding -
basic and fully diluted		802,303,622			227,495,554			896,057,587			280,109,251

Earnings (loss) per common share	$	(0.00	)	$	(0.00	)	$	(0.00	)	$	(0.00	)

See notes to the consolidated financial statements.

VIROPRO, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIT)
FOR THE PERIOD JULY 1, 2003 (INCEPTION) THROUGH SEPTEMBER 30, 2011
(IN US$)



											Deficit								Accumulated
											Accumulated								Other
					Additional			Deferred			During the								Comprehensive
	COMMON STOCK				Paid-In			Stock			Development			Subscription		Accumulated			Income
	Shares		Amount		Capital			Compensation			Stage			Receivable		Deficit			(Loss)			Total

Balance - July 1, 2003		4,116,974	$	4,117	$	1,957,308		$	-		$	-		$	-	$	(1,971,555	)	$	-		$	(10,130	)

Shareholders direct payments for accounts payable		-		-		10,130			-			-			-		-			-			10,130
Net loss for the period ended November 30, 2003		-		-		-			-			(8,525	)		-		-			-			(8,525	)

Balance - November 30, 2003		4,116,974		4,117		1,967,438			-			(8,525	)		-		(1,971,555	)		-			(8,525	)

Common shares issued for cash		250,000		250		49,750			-			-			-		-			-			50,000
Common stock subscriptions		-		-		1,190,140			-			-			-		-			-			1,190,140
Net loss for the year ended November 20, 2004		-		-		-			-			(1,159,543	)		-		-			2,478			(1,157,065	)

Balance - November 30, 2004		4,366,974		4,367		3,207,328			-			(1,168,068	)		-		(1,971,555	)		2,478			74,550

Issuance of shares subscribed for in 2004		3,834,500		3,834		(3,834	)		-			-			-		-			-			-
Common shares issued for cash		1,415,630		1,416		289,230			-			-			-		-			-			290,646
Common shares issued for services		6,265,965		6,266		1,744,828			-			-			-		-			-			1,751,094
Common stock subcriptions - cash		-		-		297,500			-			-			-		-			-			297,500
Common stock subcriptions - services		-		-		60,000			(60,000	)		-			-		-			-			-
Amortization of deferred compensation		-		-		-			15,000			-			-		-			-			15,000
Common stock subscriptions receivable		-		-		25,000			-			-			-		-			-			25,000
Net loss for the year ended November 30, 2005		-		-		-			-			(2,513,542	)		-		-			(68,795	)		(2,582,337	)

Balance - November 30, 2005		15,883,069		15,883		5,620,052			(45,000	)		(3,681,610	)		-		(1,971,555	)		(66,317	)		(128,547	)


Common shares issued for cash	4,000,997		4,001		701,587		-		-		-	-		-		705,588
Common shares issued for services	9,108,555		9,109		3,023,790		(503,625	)	-		-	-		-		2,529,274
Common shares issued for patent	3,500,000		3,500		1,046,500		-		-		-	-		-		1,050,000
Amortization of deferred compensation	-		-		-		45,000		-		-	-		-		45,000
Record debenture financing and debt discount	-		-		713,429		-		-		-	-		-		713,429
Net loss for the year ended November 30, 2006	-		-		-		-		(4,435,376	)	-	-		25,022		(4,410,354	)

Balance - November 30, 2006	32,492,621		32,493		11,105,358		(503,625	)	(8,116,986	)	-	(1,971,555	)	(41,295	)	504,390

Common shares issued for cash	600,000		600		61,400		-		-		-	-		-		62,000
Common sharres issued for services	1,893,836		1,894		236,940		(238,834	)	-		-	-		-		-
Common shares issued for converted debentures and interest	3,002,453		3,002		597,488		-		-		-	-		-		600,490
Amortization of deferred compensation	-		-		-		672,599		-		-	-		-		672,599
Record debenture financing and debt discount	-		-		600,848		-		-		-	-		-		600,848
Net loss for the year ended November 30, 2007	-		-		-		-		(2,654,604	)	-	-		(56,937	)	(2,711,541	)

Balance - November 30, 2007	37,988,910		37,989		12,602,034		(69,860	)	(10,771,590	)	-	(1,971,555	)	(98,232	)	(271,214	)

Common shares issued for settlement	3,725,000		3,725		39,200		-		-		-	-		-		42,925
Common stock cancelled	(3,727,750	)	(3,728	)	(209,009	)	-		-		-	-		-		(212,737	)
Common stock cancelled - Immuno Japan	(2,750,000	)	(2,750	)	2,750		-		-		-	-		-		-
Common shares issued for converted debentures and interest	150,000		150		29,850		-		-		-	-		-		30,000
Amortization of deferred compensation	-		-		-		69,860		-		-	-		-		69,860
Record debenture financing and debt discount	-		-		656,009		-		-		-	-		-		656,009
Net loss for the year ended November 30, 2008	-		-		-		-		(1,734,615	)	-	-		(32,977	)	(1,767,592	)

Balamce - November 30, 2008	35,386,160		35,386		13,120,834		-		(12,506,205	)	-	(1,971,555	)	(131,209	)	(1,452,749	)

Common shares issued for settlement	13,700,000			13,700			212,800			-		-			-			-			-			226,500
Common stock cancelled	(991,632	)		(992	)		(252,335	)		-		-			-			-			-			(253,327	)
Common shares issued for cash	62,500,000			62,500			717,499			-		-			-			-			-			779,999
Common shares issued for converted debentures and interest	45,660,866			45,661			1,597,397			-		-			-			-			-			1,643,058
Common shares issued for payment of interest	3,616,900			3,617			107,696			-		-			-			-			-			111,313
Common shares issued for services	5,200,000			5,200			51,800			-		-			-			-			-			57,000
Net loss for the year ended November 30, 2009	-			-			-			-		(1,464,926	)		-			-			(15,431	)		(1,480,357	)

Balance - November 30, 2009	165,072,294			165,072			15,555,691			-		(13,971,131	)		-			(1,971,555	)		(146,640	)		(368,563	)

Net loss for the transition period ended December 31, 2009	-			-			-			-		(47,200	)		-			-			38			(47,162	)

Balance - December 31, 2009	165,072,294			165,072			15,555,691			-		(14,018,331	)		-			(1,971,555	)		(146,602	)		(415,725	)

Common shares issued for cash	29,000,000			29,000			9,000			-		-			(13,000	)		-			-			25,000
Common shares issued for services	18,200,000			18,200			104,800			-		-			-			-			-			123,000
Issue shares for purchase of subsidiary	97,750,000			97,750			2,834,750			-		-			-			-			-			2,932,500
Common shares issued for conversion of convertible note	3,448,276			3,448			31,552			-		-			-			-			-			35,000
Warrants issued in private placement	-			-			14,043			-		-			-			-			-			14,043
Emergence from development stage	-			-			-					14,018,331			-			(14,018,331	)					-
Net loss for the year ended December 31, 2010	-			-			-			-		-			-			(1,010,149	)		(247,212	)		(1,257,361	)

Balance - December 31, 2010	313,470,570		$	313,470		$	18,549,836		$	-	$	-		$	(13,000	)	$	(17,000,035	)	$	(393,814	)	$	1,456,457

Common shares issued for cash	12,500,000			12,500			247,397																	259,897
Common shares issued for services	57,819,000			57,819			432,076																	489,895
Common shares issued for conversion of convertible note	6,500,000			6,500			26,000																	32,500
Common shares removed by court order	(200,000	)		(200	)		-																	(200	)
Receipt of subscription receivable	-			-			-								13,000									13,000
Common shares issued for purchase of subsidiary	525,000,000			525,000			20,475,000																	21,000,000
Net loss for the nine months ended September 30, 2011	-			-			-			-		-						(2,116,740	)		21,399			(2,095,341	)
																								-
Balance - September 30, 2011	915,089,570		$	915,089		$	39,730,309		$	-	$	-		$	-		$	(19,116,775	)	$	(372,415	)	$	21,156,208

See notes to the consolidated financial statements.

VIROPRO, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2011 AND 2010
(IN US$)

	NINE MONTHS			NINE MONTHS
	ENDED			ENDED
	SEPTEMBER 30, 2011			SEPTEMBER 30, 2010

CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)	$	(21,369,760	)	$	(873,535	)

Adjustments to reconcile net income (loss) to
net cash (used in) operating activities:
Depreciation and amortization expense		38,292			18,381
Consulting fees - non cash stock compensation		489,895			145,165
Impairment of goodwill		19,026,157
Conversion of foreign accounting standards		905,743

Change in assets and liabilities
(Increase) decrease in accounts receivable		33,671			(71,356	)
(Increase) decrease in inventory		3,157			-
(Increase) decrease in prepaid expenses		37,506			36,229
(Increase) decrease in security deposits		4,521			-
Increase (decrease) in accounts payable and accrued expenses		187,023			10,720
Increase (decrease) in deferred income		266,059			-
Total adjustments		20,992,024			139,139
Net cash (used in) operating activities		(377,736	)		(734,396	)

CASH FLOWS FROM FINANCING ACTIVITIES:
Issuance of stock for cash and liability for shares to be issued		917,876			-
(Repayment of) advances from notes payable		(501,702	)		35,025
Net cash provided by (used in) financing activities		416,174			205,025

Effect of exchange rate on cash flows		21,880			529,874

NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS		60,318			503

CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD		58,932			19,363

CASH AND CASH EQUIVALENTS - END OF PERIOD	$	119,250		$	19,866

SUPPLEMENTAL CASH FLOW INFORMATION:
Cash paid during the period for:
Interest	$	-		$	-

NONCASH FINANCING ACTIVITIES:
Conversion of convertible note into common stock	$	-		$	35,000

Acquisition of 100% of the stock of Alpha Biologics
Sdn Bhd. by issuance of $21,000,000 in Viropro's stock:
Assets Purchased	$	18,870,535		$	-
Liabilities Assumed	$	(16,888,149	)	$	-
Goodwill	$	19,017,614		$	-

Conversion of convertible debentures into common stock	$	32,500		$	-

Liability for stock to be issued was concluded with the
issuance of the common stock	$	16,957		$	-

See notes to the consolidated financial statements.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 1: Organization and Basis of Presentation

The unaudited financial statements included herein have been prepared, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). The financial statements and notes are presented as permitted on Form 10-Q and do not contain information included in the Company’s annual statements and notes. Certain information and footnote disclosure normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted pursuant to such rules and regulations, although the Company believes that the disclosures are adequate to make the information presented not misleading. It is suggested that these financial statements be read in conjunction with the December 31, 2010 Form 10-K filed with the SEC, including the audited financial statements and the accompanying notes thereto. While management believes the procedures followed in preparing these financial statements are reasonable, the accuracy of the amounts are in some respects dependent upon the facts that will exist, and procedures that will be accomplished by the Company later in the year.

VIROPRO, INC. (formerly known as Food Concepts, Inc.) (“Viropro” or the “Company”) was organized under the laws of the State of Nevada on June 16, 1982. On October 27, 1995, the Company reorganized and acquired Savon Coffee, Inc. as a wholly owned subsidiary. On January 1, 1996, the Company acquired Palm Beach Gourmet Coffee, Inc. as a wholly owned subsidiary. On June 30, 1998, the Company divested itself of its coffee operations and simultaneously acquired Insecta Sales and Research, Inc. as a wholly owned subsidiary. Viropro and its subsidiaries are collectively referred to in the consolidated financial statements as the “Company”. The principal business of the Company, which had been the wholesale distribution of various insecticides, ceased during the year ended June 30, 2003. Subsequent to June 30, 2003, the Company changed its year-end to November 30 and became a development stage company in accordance with the provisions of the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 915 “Accounting and Reporting for Development Stage Enterprises”. The Company is currently developing a generic version of a biopharmaceutical drug. On April 1, 2010, with the acquisition of Biologics Process Development Inc. outside of San Diego, California (“BPD”), the Company emerged from the development stage and is now a biotech consulting and lab services enterprise. Effective July 1, 2011, Viropro acquired 100% ownership of the stock of Alpha Biologics Sdn Bhd. (“Alpha”). The purpose of the acquisition was to have the capacity to provide contractual research and manufacturing services to biotech and biopharmaceutical companies.

Effective July 1, 2009, the Company adopted ASC 105-10, Generally Accepted Accounting Principles – Overall (“ASC 105-10”). ASC 105-10 establishes the FASB Accounting Standards Codification (the “Codification”) as the source of authoritative accounting principles recognized by the FASB to be applied by nongovernmental entities in the preparation of financial statements in conformity with U.S. GAAP. Rules and interpretive releases of the SEC under authority of federal securities laws are also sources of authoritative U.S. GAAP for SEC registrants. All guidance contained in the Codification carries an equal level of authority. The Codification superseded all existing non-SEC accounting and reporting standards. All other non-grandfathered, non-SEC accounting literature not included in the Codification is non-authoritative. The FASB will not issue new standards in the form of Statements, FASB Positions or Emerging Issue Task Force Abstracts. Instead, it will issue Accounting Standards Updates (“ASUs”). The FASB will not consider ASUs as authoritative in their own right. ASUs will serve only to update the Codification, provide background information about the guidance and provide the bases for conclusions on the change(s) in the Codification. References made to FASB guidance throughout this document have been updated for the Codification.

Note 2: Going Concern

The Company conducts operations through its subsidiaries, Viropro International Inc. (“VPRI”) and Biologics Process Development Inc. of San Diego, California (”BPD”). The Company’s new mission is to “Make Quality Biotech Drugs for Clients - Economically and Efficiently.” Its principal objective is to provide high-end, cost-effective Contractual Research and Manufacturing Services to biotech and biopharmaceutical companies in global markets. Towards this end, Viropro will transfer its own and/or in-licensed technologies for the industrial-scale production of biotherapeutic proteins such as novel biological entities (NBEs), or biosimilars, or bio-betters – all of which are life-saving treatments for various diseases including cancer, diabetes, hepatitis or multiple sclerosis. Biotech and biopharma are cutting-edge industries calling for highly specialized installations, equipment, and highly-skilled and highly-educated personnel. Viropro owns and has access to such specialized resources.

Viropro draws most of its revenues from services rendered to the biotech and biopharma industries on a cost plus percentage basis. This percentage varies according to the type of services rendered.

Viropro enjoys close working relations with some of the leading biotech research institutes in North America, one of which is the Biotech Research Institute (“BRI”) in Montreal, Canada, a constituent of the National Research Council of Canada. Viropro has licensed from BRI a high-efficiency expression system platform for antibody production.

With the July 1, 2011 completion of our acquisition of Alpha Biologics Sdn Bhd, Springhill Bioventures Sdn Bhd (“Springhill”) of Malaysia became our controlling shareholder.

Our subsidiary BPD had total revenues of $703,668 for the nine months ended September 30, 2011. BPD conducted its business development not only for its core business near San Diego but also toward development of the entire Viropro structure encompassing Molecular Biology, Purification and Development and Clinical production.

Viropro’s strategic plan, the implementation of which started in late 2009, is to develop into a premier Biotechnology Contract Research and Manufacturing Services company within 5 years. The intention is to have our operating subsidiaries provide key services using modern biotechnology principles in the area of biologics process development and cGMP-based biologics contract manufacturing.

Since April 2008, cloning and sequencing operations have been subcontracted to Innium Technology with Viropro holding the exclusive rights on the research. Innium Technology, an independent and private company, bears the infrastructure and personnel costs leaving Viropro with minimal fixed costs and liabilities.

Currently, Viropro’s focus is primarily on generating contractual work and secondarily on research work. Contractual work, which typically involves cloning, sequencing, purifying, developing, validating and producing biopharmaceutical products and sub-products, typically generates steadier streams of revenues and cash flow than research work. This can reduce financial risk for companies who are also engaging in research and development by, amongst other things, providing the funding necessary to conduct R&D.

The Company’s consolidated financial statements are presented on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business.

The Company has experienced significant losses from operations. The accumulated deficit of the Company as of September 30, 2011 is $38,369,795. As of April 1, 2010, the Company acquired Biologics Process Development, Inc., as a wholly-owned subsidiary. Income generated from this subsidiary is consolidated into the Company and as a result, the Company emerged from the development stage. In July 2011, the Company completed the acquisition of Alpha Biologics Sdn Bhd of Penang, Malaysia. This operation will also require added funding to reach profitability.

Management’s plans to address these conditions include continued aggressive efforts to expand the Company’s current business. The Company has instituted a comprehensive communications and marketing plan, plans on expanding its networking through appointment of high level advisory boards and plans on hiring external business development personnel. Management believes that these combined efforts will significantly improve the success rate of sales. The Company continues to seek additional capital periodically through equity and debt financings. Additionally, the executive management team has put into place an aggressive cost and expense savings spending plan to identify and eliminate costs which are directly impacting profitability.

The Company’s ability to continue as a going concern is contingent upon its ability to secure additional financing, increase ownership equity and attain profitable operations. In addition, the Company’s ability to continue as a going concern must be considered in light of the problems, expenses and complications frequently encountered by smaller companies attempting to enter established markets and the competitive environment in which the Company operates. These factors raise substantial doubt regarding the ability of the Company to continue as a going concern.

These consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts, or amounts and classification of liabilities that might result from this uncertainty.

Note 3: Goodwill

Effective July 1, 2011, Viropro acquired 100% ownership of the stock of Alpha Biologics Sdn Bhd. (“Alpha”). The purpose of the acquisition was to have the capacity to provide contractual research and manufacturing services to biotech and biopharmaceutical companies. Biotech and biopharmaceutical companies are in need of specialized installations, equipment, and skilled personnel. Alpha is positioned to provide these to Viropro.

The consideration for acquiring Alpha’s stock totaled $21,000,000 paid in shares of Viropro’s stock. Certificates representing 525,000,000 shares of Viropro stock were issued to Springhill Bioventures Sdn Bhd, THG Capital Sdn Bhd and Michelle Leanne Edythe Peake. Viropro acquired the assets and assumed the liabilities as noted below in consideration of the shares of common stock at a value of $21,000,000. Based on the fair values at the effective date of acquisition the purchase price was allocated as follows:

Assets Purchased
Cash	$	67
Inventory		53,788
Deposits & Prepaids		153,914
Taxes receivable		7,645
Building		18,477,548
Office & Furniture		169,030
Goodwill		8,543

Liabilities Assumed
Loan		(9,513,709	)
Trade & Other Creditors		(307,123	)
Accrued Expenses		(1,073,539	)
Deferred Income		(2,783,172	)
Loan - Viropro Inc.		(316,426	)
Loan - Michelle Leanne Edythe Peake		(43,910	)
Loan – Springhill Bioventures Sdn Bhd		(2,850,270	)

Net Assets Purchased		1,982,386

Goodwill		19,017,614

Purchase Price	$	21,000,000

The goodwill will not be amortized but it will be tested annually for impairment. Goodwill in connection with this acquisition is stated at $19,017,614 in the books and records of Viropro and is tax deductible. There is also Goodwill in the books of Alpha relating to their acquisition of a company in the United Kingdom. This goodwill is stated at $8,543. See note below in the section “Testing for the Impairment of Goodwill”.

The following table shows pro-forma results for the nine months ended September 30, 2011and 2010 as if the acquisition had occurred on January 1, 2011. These unaudited pro forma results of operations are based on the historical financial statements and related notes of each of the Company and Alpha for the nine months ended September 30, 2010, and contain adjustments to depreciation and amortization for the effects of the purchase price allocation, and to income tax expense to record income tax expense for the Alpha.

	Nine Months Ended September 30,
	2011			2010
	Pro forma
	(in thousands)
Revenues	$	758,433		$	397,280
Net Income (Loss)	$	(21,369.761	)	$	(873,535	)

The revenue and net income of Alpha included in the consolidated statement of operations for the three months ended September 30, 2011 were $54,765 and$(589,325,319) respectively. The figures are nil for September 30, 2010 as the company was not part of Viropro.

On April 14, effective April 1, 2010, Viropro acquired 100% ownership of the stock of Biologics Process Development, Inc. (“BPD”). The purpose of the acquisition was to have the capacity to provide contractual research and manufacturing services to biotech and biopharmaceutical companies. Biotech and biopharmaceutical companies are in need of specialized installations, equipment, and skilled personnel. BPD is positioned to provide these to Viropro.

The consideration for acquiring BPD’s stock totaled $2,932,500 paid in shares of Viropro’s stock. Certificates representing 97,750,000 shares of Viropro stock were issued to Intas Biopharmaceuticals LTD. Viropro acquired the assets and assumed the liabilities as noted below in consideration of the shares of common stock at a value of $2,832,750. Based on the fair values at the effective date of acquisition the purchase price was allocated as follows:

Assets Purchased
Cash	$	68,458
Accounts Receivable		67,096
Other Current Assets		39,586
Property and Equipment		82,875
Loans Receivable		989,975
Other Assets		5,593

Liabilities Assumed

Accounts Payable and Accrued Expenses		(125,057	)
Notes Payable		(73,505	)

Net Assets Purchased		1,055,021

Goodwill		1,877,479

Purchase Price	$	2,932,500

The goodwill will not be amortized but it will be tested annually for impairment. Goodwill in connection with this acquisition is stated at $1,877,479 in the books and records of BPD and is tax deductible.

The following table shows pro-forma results for the nine months ended September 30, 2011and 2010 as if the acquisition had occurred on January 1, 2011. These unaudited pro forma results of operations are based on the historical financial statements and related notes of each of the Company and BPD for the nine months ended September 30, 2010, and contain adjustments to depreciation and amortization for the effects of the purchase price allocation, and to income tax expense to record income tax expense for the BPD.

	Nine Months Ended September 30,
	2011			2010
	Pro forma
	(in thousands)
Revenues	$	893,328		$	397,280
Net Income (Loss)	$	(2,116,740	)	$	(873,535	)

The revenue and net income of BPD included in the consolidated statement of operations for the nine months ended September 30, 2011 and September 30, 2010 were approximately $703,668 and $397,280 respectively.

The pro forma information is presented for informational purposes only and is not necessarily indicative of the results of operations that actually would have been achieved had the acquisition been consummated as of that time, nor is it intended to be a projection of future results.

The Company adopted ASC 805, Business Combinations (“ASC 805”). ASC 805 retains the fundamental requirements that the acquisition method of accounting be used for all business combinations and for an acquirer to be identified for each business combination. ASC 805 defines the acquirer as the entity that obtains control of one or more businesses in the business combination and establishes the acquisition date as the date that the acquirer achieves control. ASC 805 requires an entity to record separately from the business combination the direct costs, where previously these costs were included in the total allocated cost of the acquisition. ASC 805 requires an entity to recognize the assets acquired, liabilities assumed, and any non-controlling interest in the acquired at the acquisition date, at their fair values as of that date.

ASC 805 requires an entity to recognize as an asset or liability at fair value for certain contingencies, either contractual or non-contractual, if certain criteria are met. Finally, ASC 805 requires an entity to recognize contingent consideration at the date of acquisition, based on the fair value at that date. This will be effective for business combinations completed on or after the first annual reporting period beginning on or after December 15, 2008. Early adoption is not permitted and the ASC is to be applied prospectively only.

CTM Biotech Ltd was acquired by Alpha Biologics Sdn. Bhd. (Alpha Malaysia) in January 2007, The acquired company was renamed Alpha Biologics Ltd (Alpha UK). At June 2011 Alpha Malaysia was showing goodwill for this transaction of $8,543. Alpha UK has had cashflow shortfalls since December 2011. Unless funding is injected into the company urgently it cannot be considered a going concern. The goodwill has been tested for impairment and therefore has been fully impaired.

Alpha Malaysia was acquired by Viropro in July 2011. The Company requires funding to complete manufacturing certification and become fully operational. To date the extra funding has not been forthcoming. Without this funding Alpha Malaysia cannot be considered a going concern. The goodwill generated by the Alpha acquisition amounts to $19,017,614 and has been fully impaired in the three months ended September 30, 2011 following the Company’s acquisition of Alpha. The total goodwill impairment is $19,026,157.

Note 4: Summary of Significant Accounting Policies

Principles of Consolidation

The consolidated financial statements include the accounts of the Company and its subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. On an on-going basis, the Company evaluates its estimates, including, but not limited to, those related to investment tax credits, bad debts, income taxes and contingencies. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results could differ from those estimates.

Cash and Cash Equivalents

The Company considers all highly liquid debt instruments and other short-term investments with an initial maturity of three months or less to be cash equivalents.

Comprehensive Income

The Company adopted ASC 220-10, Reporting Comprehensive Income , (formerly SFAS No. 130). ASC 220-10 requires the reporting of comprehensive income in addition to net income from operations.

Comprehensive income is a more inclusive financial reporting methodology that includes disclosure of information that historically has not been recognized in the calculation of net income.

Fair Value of Financial Instruments

The carrying amounts reported in the consolidated balance sheets for cash and cash equivalents, accounts receivable and accounts payable approximate fair value because of the immediate or short-term maturity of these financial instruments. For the loans payable, the carrying amount reported is based upon the incremental borrowing rates otherwise available to the Company for similar borrowings.

Currency Translation

For subsidiaries outside the United States that prepare financial statements in currencies other than the U.S. Dollar, the Company translates income and expense amounts at average exchange rates for the year, translates assets and liabilities at year-end exchange rates and equity at historical rates. The Company’s functional currency is the US Dollar but operations in Malaysia are recorded in Malaysian Ringgits,operations in Canada are recorder in Canadian Dollars and operations in the United Kingdom in Pounds Sterling. The Company records these translation adjustments as accumulated other comprehensive income (loss). Gains and losses from foreign currency transactions are included in other income (expense) in the results of operations.

Revenue Recognition

The Company records revenue when persuasive evidence of an arrangement exists, services have been rendered or product delivery has occurred, the sales price to the customer is fixed or determinable, and collectability is reasonably assured. The Company generates revenues from consulting services as well as lab services they perform. They generally bill for these services at the end of each month or in accordance with the individual arrangements with their customers. All revenue recognized is for services that have been rendered, and the Company does not pre-bill for any services.

In addition, the Company enters into development agreements for the development of monoclonal antibody-based therapeutics. The terms of these agreements contain multiple deliverables. Payments to the Company under these agreements may include payments for the manufacture of preclinical or clinical materials, payments based upon the achievement of certain milestones and royalties on product sales. The Company follows the provisions of the Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) Topic 605-25, Revenue Recognition—Multiple-Element Arrangements , and ASU No. 2010-17, Revenue Recognition—Milestone Method , in accounting for these agreements. In order to account for these agreements, the Company must identify the deliverables included within the agreement and evaluate which deliverables represent separate units of accounting based on if certain criteria are met, including whether the delivered element has standalone value to the collaborator. The consideration received is allocated among the separate units of accounting, and the applicable revenue recognition criteria are applied to each of the separate units.

Accounts Receivable

The Company conducts business and extends credit based on an evaluation of the customers’ financial condition, generally without requiring collateral.

Exposure to losses on receivables is expected to vary by customer due to the financial condition of each customer. The Company monitors exposure to credit losses and maintains allowances for anticipated losses considered necessary under the circumstances. The Company has no allowance for doubtful accounts as of September 30, 2011.

Accounts receivable are generally due within 30 days and collateral is not required. Unbilled accounts receivable represents amounts due from customers for which billing statements have not been generated and sent to the customers.

Income Taxes

The Company accounts for income taxes utilizing the liability method of accounting. Under the liability method, deferred taxes are determined based on differences between financial statement and tax bases of assets and liabilities at enacted tax rates in effect in years in which differences are expected to reverse. Valuation allowances are established, when necessary, to reduce deferred tax assets to amounts that are expected to be realized. For Alpha no income tax liability has been recognized because Alpha Malaysia has tax free status for a 10 year period from the start of commercial operations. Alpha UK also has no income tax liabilities as it has accumulated tax losses brought forward.

Fixed Assets

Fixed assets are stated at cost. Depreciation is computed using the straight-line method over the estimated useful lives of the assets; office and computer equipment – 4 or 5 years, depending on the asset.

When assets are retired or otherwise disposed of, the costs and related accumulated depreciation are removed from the accounts, and any resulting gain or loss is recognized in income for the period. The cost of maintenance and repairs is charged to income as incurred; significant renewals and betterments are capitalized. Deduction is made for retirements resulting from renewals or betterments.

Depreciation expense for the nine months ended September 30, 2011and 2010 was $38,225 and $18,381 respectively.

Long-lived assets and fixed assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets might not be recoverable. The Company does perform a periodic assessment of assets for impairment in the absence of such information or indicators. Conditions that would necessitate an impairment assessment include a significant decline in the observable market value of an asset, a significant change in the extent or manner in which an asset is used, or a significant adverse change that would indicate that the carrying amount of an asset or group of assets is not recoverable. For long-lived assets to be held and used, the Company recognizes an impairment loss only if its carrying amount is not recoverable through its undiscounted cash flows and measures the impairment loss based on the difference between the carrying amount and estimated fair value.

Loss Per Share of Common Stock

Basic net loss per common share is computed using the weighted average number of common shares outstanding. Diluted earnings per share (EPS) include additional dilution from common stock equivalents, such as stock issuable pursuant to the exercise of stock options and warrants. Common stock equivalents were not included in the computation of diluted earnings per share when the Company reported a loss because to do so would be antidilutive for periods presented.

The following is a reconciliation of the computation for basic and diluted EPS:

	September 30,		September 30,
	2011		2010

Net (loss)	$	(21,369,760)	$	(873,535)

Weighted-average common shares Outstanding (Basic)		522,240,130		227,495,554

Weighted-average common stock Equivalents
Stock options		-		-
Warrants		1,550,000		-

Weighted-average common shares Outstanding (Diluted)		523,790,130		227,495,554

Stock-Based Compensation

In 2006, the Company adopted the provisions of ASC 718-10 “Share Based Payments” for its year ended December 31, 2008. The adoption of this principle had no effect on the Company’s results of operations.

The Company has elected to use the modified–prospective approach method. Under that transition method, the calculated expense in 2006 is equivalent to compensation expense for all awards granted prior to, but not yet vested as of January 1, 2006, based on the grant-date fair values. Stock-based compensation expense for all awards granted after January 1, 2006 is based on the grant-date fair values. The Company recognizes these compensation costs, net of an estimated forfeiture rate, on a pro rata basis over the requisite service period of each vesting tranche of each award. The Company considers voluntary termination behavior as well as trends of actual option forfeitures when estimating the forfeiture rate.

The Company measures compensation expense for its non-employee stock-based compensation under ASC 505-50, Accounting for Equity Instruments that are Issued to Other Than Employees for Acquiring, or in Conjunction with Selling, Goods or Services . The fair value of the option issued is used to measure the transaction, as this is more reliable than the fair value of the services received.

The fair value is measured at the value of the Company’s common stock on the date that the commitment for performance by the counterparty has been reached or the counterparty’s performance is complete. The fair value of the equity instrument is charged directly to compensation expense and additional paid-in capital.

Segment Information

The Company follows the provisions of ASC 280-10, Disclosures about Segments of an Enterprise and Related Information . This standard requires that companies disclose operating segments based on the manner in which management disaggregates the Company in making internal operating decisions.

Uncertainty in Income Taxes

The Company follows ASC 740-10, Accounting for Uncertainty in Income Taxes (“ASC 740-10”). This interpretation requires recognition and measurement of uncertain income tax positions using a “more-likely-than-not” approach. ASC 740-10 is effective for fiscal years beginning after December 15, 2006. Management has adopted ASC 740-10 for 2009, and they evaluate their tax positions on an annual basis, and has determined that as of September 30, 2011, no additional accrual for income taxes other than the federal and state provisions and related interest and estimated penalty accruals is not considered necessary.

Fair Value Measurements

In September 2006, FASB issued ASC 820, Fair Value Measurements (“ASC 820”). ASC 820 defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles, and expands disclosure about fair value measurements. This statement is effective for financial statements issued for fiscal years beginning after November 15, 2007. Early adoption is encouraged. The adoption of ASC 820 is not expected to have a material impact on the financial statements.

In February 2007, FASB issued 825-10, The Fair Value Option for Financial Assets and Financial Liabilities – Including an amendment of ASC 320-10 , (“ASC 825-10”) which permits entities to choose to measure many financial instruments and certain other items at fair value at specified election dates. A business entity is required to report unrealized gains and losses on items for which the fair value option has been elected in earnings at each subsequent reporting date. This statement is expected to expand the use of fair value measurement. ASC 825-10 is effective for financial statements issued for fiscal years beginning after November 15, 2007, and interim periods within those fiscal years.

Recent Accounting Pronouncements

In May 2011, FASB issued Accounting Standards Update (ASU) No. 2011-04, Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRSs . FASB ASU 2011-04 amends and clarifies the measurement and disclosure requirements of FASB ASC 820 resulting in common requirements for measuring fair value and for disclosing information about fair value measurements, clarification of how to apply existing fair value measurement and disclosure requirements, and changes to certain principles and requirements for measuring fair value and disclosing information about fair value measurements. The new requirements are effective for fiscal years beginning after December 15, 2011. The Company plans to adopt this amended guidance on October 1, 2012 and at this time does not anticipate that it will have a material impact on the Company’s results of operations, cash flows or financial position.

In June 2011, FASB issued ASU No. 2011-05, Presentation of Comprehensive Income , which amends the disclosure and presentation requirements of Comprehensive Income. Specifically, FASB ASU No. 2011-05 requires that all nonowner changes in stockholders’ equity be presented either in 1) a single continuous statement of comprehensive income or 2) two separate but consecutive statements, in which the first statement presents total net income and its components, and the second statement presents total other comprehensive income and its components. These new presentation requirements, as currently set forth, are effective for the Company beginning October 1, 2012, with early adoption permitted.

The Company plans to adopt this amended guidance on October 1, 2012 and at this time does not anticipate that it will have a material impact on the Company’s results of operations, cash flows or financial position.

In September 2011, FASB issued ASU 2011-08, Testing Goodwill for Impairment , which amended goodwill impairment guidance to provide an option for entities to first assess qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more likely than not that the fair value of a reporting unit is less than its carrying amount. After assessing the totality of events and circumstances, if an entity determines that it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, performance of the two-step impairment test is no longer required. This guidance is effective for annual and interim goodwill impairment tests performed for fiscal years beginning after December 15, 2011, with early adoption permitted. Adoption of this guidance is not expected to have any impact on the Company’s results of operations, cash flows or financial position.

There were other updates recently issued, most of which represented technical corrections to the accounting literature or application to specific industries and are not expected to have a material impact on the Company’s financial position, results of operations or cash flows.

Note 5: Property and Equipment

Equipment as of September 30, 2011(unaudited) and December 31, 2010 were as follows:

Estimated Useful Lives
	Years		September 30, 2011		December 31, 2010
Property and Equipment		3-5	$	18,039,372	$	316,052
Less : Accumulated Depreciation				279,122		258,414
Equipment, net			$	17,760,250	$	57,638

There was $38,225and $0 charged to operations for depreciation expense for the nine months ended September 30, 2011and 2010, respectively.

The Alpha property in Malaysia has liens to secure the following debts:

-	Bank Pembangunan Term Loan 1	RM 20,000,000
-	Bank Pembangunan Term Loan 2	RM 5,000,000
-	Penang Development Corporation Contract Funding	RM 18,425,797
		RM 42,832,741

-	Loan from Springhill Bioventure Sdn Bhd	RM 8,575,000

Note 6: Income Taxes

As of September 30, 2011, the Company has a net operating loss carry forward of approximately $38,686,898. This loss will be available to offset future taxable income. If not used, this carry forward will expire through 2031. Components of net deferred tax assets, including a valuation allowance, are as follows:

	2011
Deferred tax assets:
Net operating loss carryforward	$	13,153,545
Total deferred tax assets		13,153,545
Less: Valuation Allowance		(13,153,545	)

Net Deferred Tax Assets	$	-

The valuation allowance for deferred tax assets as of September 30, 2011was approximately $13,153,545. In assessing the recovery of the deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income in the periods in which those temporary differences become deductible. Management considers the scheduled reversals of future deferred tax assets, projected future taxable income, and tax planning strategies in making this assessment. As a result, management determined it was more likely than not the deferred tax assets would not be realized as of September 30, 2011and, accordingly, recorded the full valuation allowance.

Reconciliation between the statutory rate and the effective tax rate is as follows at September 30, 2011:

	2011			2010

Federal statutory tax rate		(34.0	)%		(34.0	)%
Change in valuation allowance		34.0	%		34.0	%

Effective tax rate		0.0	%		0.0	%

Note 7: Convertible Debentures

On March 1, 2006, the Company commenced an offering of convertible debentures. The offering consisted of a minimum of 700 and a maximum of 1,300 debentures at a price of $1,000 per debenture. The debentures were convertible into common shares at $0.20 per share through March 1, 2009, and bear interest at 6% per annum. In conjunction with the sale of each $1,000 debenture, the Company would issue 5,000 warrants to purchase common shares at $0.25 per share expiring on March 1, 2009. Through November 30, 2006, an aggregate of $713,429 had been received in cash.

As of May 31, 2007, the entire subscription of $1,300,000 had been collected. The Company had determined the debentures to have a beneficial conversion feature totaling $420,527. The beneficial conversion feature had been recorded as a debt discount which was being amortized over the life of the loans. The beneficial conversion feature was valued under the Black-Scholes options pricing model using the following assumptions: a stock price between $0.19 and $1.19; estimated life of 3 years; historical volatility rate ranging between 205% and 251% and debt discount rate of 6.00%. The investors had 3 years from March 1, 2006 to exercise up to 6,500,000 warrants. The warrant strike price was $0.25 per share of restricted stock. The Company had determined the warrants to have a value of $838,587 which had been reflected as a financing cost and was amortized over the life of the loans. The warrants were valued under the Black-Scholes options pricing model.

On October 2007, the Company announced an expected $1.5 Million financing. On December 21, 2007, the Company informed its Stockholders that the first tranche of $300,000 related to the $1.5 Million financing was not closed due to unfavorable market conditions. As of November 30, 2007, the Company raised only $70,000 from this first tranche of $300,000, and this $70,000 was outstanding as of December 31, 2010. In March 2011, an individual investor purchased a portion of these debentures for $32,500 and this amount was converted into 6,500,000 shares. $37,500 remains outstanding at September 30, 2011.

In early 2008, Viropro issued up to $1,300,000 of convertible debentures to 9188- 5400 Québec Inc. a private holding company. From March 1, 2007 to March 1, 2009 investors converted $630,490 in private debenture financing which included accumulated interest of $74,490 into 3,032,112 common shares. In addition, debentures totaling $56,000 were settled with cash.

At the maturity date of the debentures, the Company offered to the owners to exchange the debentures for common shares instead of cash. The Company has thus issued 13,661,600 common shares to convert $603,000 of debentures, cumulated interest of $43,424 and a premium valued at $36,656. In addition, debentures totaling $25,000 were settled with $5,000 in cash. At September 30, 2011outstanding debentures of $30,000 relating to four debenture holders were still unpaid and are in default. The Company is involved in litigation regarding this outstanding total (See Note 12).

The total of the convertible debentures from all financings is $67,500 at September 30, 2011.

Note 8: Convertible Promissory Note

On June 14, 2010, the Company issued a $35,000, 8% Convertible Promissory Note to Asher Enterprises, Inc., which was to mature on March 16, 2011. The Convertible Promissory Note was convertible into shares of common stock at 58% of the 10 day average trading price of the common stock on the date of conversion. The note was converted into 3,448,276 shares of common stock on July 27, 2010. There was no change in the value of the common stock from date of issuance of the Convertible Promissory Note through July 27, 2010. There was no discount associated with this note.

Long Term Debt	$	11,981,743

Current portion of notes payable		73,556

Total Long Term Debt	$	11,908,187

Note 9: Notes Payable

Related Parties

The Company consolidated a $60,000 note payable to Scott Brown who is our founder of BPD and is currently the Chief Science Officer of the Company. The note is interest bearing and due on demand. The amount is included in current liabilities on the consolidated balance sheet at September 30, 2011.

The Company has also been advanced $13,556 (net of repayments of $2,000 in the nine months ended September 30, 2011) from other officers of the Company, through September 30, 2011. The advance is also non-interest bearing and due on demand. This advance is included in current liabilities on the consolidated balance sheet at September 30, 2011.

Alpha Biologics Sdn. Bhd. had loans outstanding owed to Springhill Bioventures Sdn. Bhd. which were acquired by the company when Alpha was acquired. These loans amounted to $2,688,931 (RM 8,575,000) . Springhill Bioventures Sdn. Bhd. is a major shareholder in Viropro Inc.

Michelle Leanne Edythe Peake, the CEO of Alpha Biologics Sdn. Bhd. has lent the subsidiary company Alpha Biologics Ltd, $10,941 (UKL 7,132)

Banks

Alpha Biologics Sdn. Bhd. has a bank loan of $9,208,315 (RM 25.2 Million) from Bank Pembangunan Malaysia Bhd. The interest rate on this loan is 5% annually.

Note 10: Stockholders’ Deficit

The issuances of common stock for the nine months ended September 30, 2011and year ended December 31, 2010 are as follows:

In March 2010, 3,200,000 shares were issued to Cansim Minas SA de CV for services, valued at $48,000 or $0.015 per share.

On April 20, 2010, 79,166,666 shares issued to BPD to acquire VIROPRO, INC. were cancelled and reissued with an additional 27,750,000 to Intas Biopharmaceuticals Ltd and a 70,000,000 issuance to IBP LLC as payment for the acquisition of BPD, for a total of 97,750,000 shares valued at $2,932,500. The Company recorded $1,877,479 in goodwill in this transaction.

On May 27, 2010, 2,000,000 shares were issued to Claude Gingras and 2,500,000 to Serge Beausoleil under a Form S-8 Registration Statement, for a value of $22,500.

On July 8, 2010, 10,500,000 restricted shares were issued to management at a price of $0.005 per share for services rendered; 2,500,000 to Serge Beausoleil, 2,500,000 to Dr. Rajiv Datar, 2,000,000 to Claude Gingras, 2,000,000 to Dr Scott M. Brown, and 1,500,000 to Jeff Hale for an aggregate value of $52,500.

On July 27, 2010, the Company converted the $35,000 convertible note held by Asher Enterprises Inc. into 3,448,276 shares of common stock.

On November 20, 2010, 20,000,000 shares were issued under a private placement agreement of $20,000.

On December 22, 2010, 9,000,000 shares were issued under a private placement agreement of $18,000.

On January 14, 2011 a total of 13,669,000 were issued to Serge Beausoleil and Claude Gingras as payment for their regular consulting fees payable at a value of $68,345.

On January 27, 2011, 4,000,000 shares were issued in a private placement for $20,000.

On January 27, 2011, 1,550,000 shares were issued in a private placement for $20,447, which proceeds were received in 2010 and this was reflected as a liability for stock to be issued at December 31, 2010.

On February 18, 2011 a payment in shares of 4,500,000 shares was processed to a non related third party for services rendered valued at $18,000.

On March 15, 2011, 200,000 shares were cancelled as per Court Order received by the transfer agent.

On March 17, 2011, 5,000,000 shares were issued pursuant to a Private Placement for $125,000 and 6,500,000 from the conversion of a debenture in the amount of $32,500.

On April 26, 2011, 7,500,000 were issued pursuant to a private placement.

On May 2, 2011, 17,000,000 shares were issued to Rajiv Datar and 4,000,000 Claude Gingras to offset due fees and expense accounts.

On June 2, 2011, 5,000,000 shares were issued to a consultant.

June 16, 2011, 6,000,000 shares were issued to Innium Technologies as payment in shares for services rendered.

On July 5, 2011, 100,000 restricted shares were issued to Bernard Twyford Raymond as payment for consultant services,

On July 11, 2011, as payment for the acquisition of Alpha Biologics Bhd Sdn, 340,097,124 restricted shares were issued to Springhill Bioventures Sdn Bhd, 183,844,211 restricted shares were issued to THG Capital Sdn Bhd and 1,058,665 restricted shares were issued to Michelle Leanne Peake.

On July 22, 2011, 1,000,000 restricted shares each were issued to both Cynthia Tsai and Andrew Boico as part of their consultancy agreement.

Warrants

The Company issued 1,550,000 warrants to individuals investors in connection with a $31,000 private placement of 1,550,000 common shares at $0.02 in July 2010. The common shares were issued in January 2011, however the warrants were issued in July 2010. The warrants have an exercise price of $0.025 per share and term of 2 years. The Company valued the warrants at $14,043, and have reflected this in additional paid in capital.

The following is a breakdown of the warrants:

Warrants				Exercise Price			Date Issued	Term
	1,550,000			$	0.025		07/01/2010	2 years

Note 11: Commitments and Contingencies

During the periods covered by these financial statements, the Company issued shares of common stock and subordinated debentures without registration under the Securities Act. Although the Company believes that the sales did not involve a public offering of its securities and the Company did comply with the “safe harbor” or other exemptions from registration under rules and regulations of the Securities Act, if such exemptions were found not to apply, this could have a material impact on the Company’s financial position and results of operations. In addition, the Company issued shares of common stock pursuant to Form S-8 registration statements and pursuant to Regulation S. The Company believes that it complied with the requirements of Form S-8 and Regulation S in regard to these issuances; however, if it were determined that the Company did not comply with these provisions, this could have a material impact on the Company’s financial position and results of operations. The Company cannot otherwise estimate the potential loss or range of loss it might experience if it were determined that the Company had violated the Securities Act by failing to comply with Securities Act safe harbors, Regulation S, other Securities Act exemptions or the requirements for use of Form S-8.

In April 2008, the Company awarded Innium Technologies of Montreal all its research and development on the Anti-CD20 project. Viropro will fund the R&D costs but will retain the entire intellectual property and all rights relating to the project; in so doing, Viropro has further reduced its fixed costs but all advances made prior to this agreement have been expensed so as to reflect the arm’s length relation with Innium.

On January 5, 2011, the Company announced it had entered into an agreement with Spectrum Pharmaceuticals Inc. for the development of a biosimilar of Rituximab.

Note 12: Legal Proceedings

On July 13, 2009 HKDP, a supplier to Viropro initiated procedures claiming $37,991.95 for an unpaid bill. Management entered into discussions with the claiming party in January 2011 but no settlement has yet been reached.

On June 21, 2009 a $5,000 Securecap convertible debenture holder initiated procedures against the Company to recover capital due at maturity. Management of the Company had offered to the holder, as it had done will all Securecap Convertible Debenture holders, to convert its debenture into common shares at a lower price than the initially set price. The claim was filed in the Small Claims Court of Montreal, district of Longueuil, Province of Quebec, Canada under file no 505-32-025648-099. On February 10, 2011, the Company settled litigation with Securcap Debenture holders; the Company agreed to convert all outstanding debentures into common shares in exchange for the holders dismissing all claims.

In August 2011, IAS Equity was granted judgment by default in Court Procedure in the Supreme Court of the State of New York County of Nassau case no 600932/2011filed against Viropro Inc. for failure to pay full amount of a consultant agreement; an outstanding balance of $25,000 was left unpaid. Discussions between management and IAS’ representative are being held to resolve the matter.

Note 13: Subsequent Events

	●	October 2011, 1,000,000 shares were issued to Cooper Global Communication under the Investors Relations Agreement.
	●	On December 28, 2011, 9,000,000 shares were reserved for the Conversion of a Note issued to Magna Corp for funding.
	●	On January 12, 2012, another note was issued to Magna Corp and another reserve of 9,000,000 shares was created for same reasons

	●	On January 23, 2012, reserve for note issued in January was increased by 2,000,000 shares.
	●	On February 7, 2012, 9,000,000 shares were issued to 9188-5400 QC as part of its consultancy agreement.
	●	On February 10, 2012, 750,000 were issued to 9188-5400 QC Inc. for a private placement performed in 2011.
	●	On March 15, 2012, 7,500,000 shares were issued to Serge Beausoleil for a private placement performed in 2011.
	●	On March 15, 2012, 350,000 shares were issued to KSC trading as payment of referral fees
	●	On March 28,2012 a reserve of 14,000,000 shares was created to allow conversion of a note issued to Magna Corp.

In June 2012, a form 13-D was filed on behalf of the majority shareholder requesting the voluntary resignation of Dr Rajiv Datar as CEO of Viropro.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

THE FOLLOWING DISCUSSION AND ANALYSIS OF THE FINANCIAL CONDITION AND RESULTS OF OPERATIONS OF VIROPRO, INC. SHOULD BE READ IN CONJUNCTION WITH THE UNAUDITED CONDENSED FINANCIAL STATEMENTS AND NOTES INCLUDED ELSEWHERE IN THIS REPORT.

THIS DISCUSSION AND ANALYSIS CONTAINS FORWARD-LOOKING STATEMENTS THAT INVOLVE RISKS AND UNCERTAINTIES . YOU CAN IDENTIFY OUR FORWARD-LOOKING STATEMENTS BY WORDS SUCH AS “ANTICIPATE,” “BELIEVE,” “ESTIMATE,” “EXPECT,” “FORECAST,” “GOAL,” “INTEND,” “PLAN,” “PREDICT,” “PROJECT,” “SEEK,” “TARGET,” “COULD,” “MAY,” “SHOULD” OR “WOULD” OR OTHER SIMILAR EXPRESSIONS THAT CONVEY THE UNCERTAINTY OF FUTURE EVENTS OR OUTCOMES. IN ACCORDANCE WITH “SAFE HARBOR” PROVISIONS OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995, THESE STATEMENTS ARE ACCOMPANIED BY CAUTIONARY LANGUAGE IDENTIFYING IMPORTANT FACTORS, THOUGH NOT NECESSARILY ALL SUCH FACTORS, WHICH COULD CAUSE FUTURE OUTCOMES TO DIFFER MATERIALLY FROM THOSE SET FORTH IN FORWARD-LOOKING STATEMENTS.

Overview

VIROPRO, INC. (“Viropro” or the “Company”) conducts operations through its subsidiaries, Viropro International Inc. (“VPRI”), Biologics Process Development Inc. of San Diego, California (”BPD”), Alpha Biologics Ltd. of Cambridge, UK and Alpha Biologics Sdn. Bhd. of Penang, Malaysia. Viropro specializes in the development and manufacturing of biopharmaceutical drugs and offers services to a wide array of pharmaceutical and biotechnology companies. Additionally, it engages in the transfer of its core and proprietary technologies for industrial production of biogeneric therapeutic proteins for the treatment of various diseases including cancer, diabetes, hepatitis or multiple sclerosis. Viropro’s mission is to develop and produce superior biopharmaceuticals efficiently and economically. The Company’s principal objective is to provide contractual research and manufacturing services to biotech and biopharmaceutical companies in global markets and, more particularly, to provide high-yield development and GMP manufacturing services. Biotech and biopharma are cutting edge industries calling for highly specialized installations and equipment as well as highly skilled and highly educated personnel. Viropro owns and/or has access to such specialized resources. Additionally, Viropro owns three (3) clones: two (2) in insulin therapy and one (1) for cancer therapy. Currently, Viropro draws most of its revenues from custom services provided to the biotech and biopharma industries on a cost plus percentage basis. This percentage varies according to the type of services rendered.

In July 2011, Springhill Bioventures Bhg Sdn and THG Capital Bhd Snd jointly received 525,000,000 shares to acquire Alpha Biologics Bhd Sdn of Penang Malaysia in a transaction valued at $21,000,000. Springhill and THG both now are controlling shareholders and jointly have a majority of the shares of Viropro.

Viropro’s strategic plan, which implementation started in 2009 is to develop into a premier Biotechnology Contract Research and Manufacturing Services company within 5 years. The intention is to have our operating subsidiaries provide key services using modern biotechnology principles in the area of biologics process development and cGMP-based biologics contract manufacturing. It also includes the addition of other analytic capabilities via acquisition of a protein sequencing and analytics lab, geographic expansion of GMP manufacturing operations (CRAMS) into India, Southeast Asia, and South America and the continuation of building strategic alliances within the pharma industry.

Since April 2008, cloning and sequencing operations have been subcontracted to Innium Technologies, Inc., located in Montreal, Canada with Viropro holding the exclusive rights to the research. Innium Technologies, an independent private company, bears the infrastructure and personnel costs leaving Viropro with minimal fixed costs and liabilities.

Currently, Viropro’s primary focus is generating contract work and, secondarily, research work. Contracwork, which typically involves cloning, sequencing, purifying, developing, validating and producing biopharmaceutical products and sub-products, typically generates steadier streams of revenues and cash flow than research work. This can reduce financial risk for companies that are also engaging in research and development by, among other things, providing steady cash flow to support R&D activities contemporaneously with contract work. Viropro typically generates the larger portion of its revenues from contract work.

The Biotech Industry

Viropro believes that the fundamentals of the biotech industry, from a US perspective, continue to be strong (in spite of recent global economic challenges) for the following reasons:

	●	The biotech industry has had more than twenty-five years of building the necessary infrastructure for sustained growth.

	●	The pricing power of smaller biotech firms in deals with pharmaceutical manufacturers has steadily improved. In the 1990s biotech companies were unable to negotiate high royalty percentages and settled for a low double-digit royalty from a pharmaceutical company to obtain sufficient funding for a drug’s development. Currently, it is common for biotech companies and their pharmaceutical partners to enter into 50:50 profit sharing arrangements, representing at least a 3-fold increase in the industry’s pricing power.

	●	The biotech/biopharma industry is typically noncyclical, which tends to shelter the industry from economic downturns.

	●	Biotech has produced real results, with an increasing number of products coming to market. Based upon the number of biotech drugs currently in the U.S’s. FDA approval pipeline, it can be said that the biotech industry has reached critical mass.

Viropro's analysis of the U.S. biotech market is summarized below from the perspective of opportunities for Indo-U.S. biotech companies. The availability of highly skilled, but low-cost, scientific manpower in India – a situation not too different from the niche carved out by Indian software companies - provides the following opportunities:

	●	The increasing trend towards Contract R&D by biopharmaceutical companies due to the ever-expanding cost of bringing biopharmaceuticals to the market.
	●	A noticeable trend towards contract manufacturing (in U.S. FDA-approved GMP facilities).
	●	The production of off-patent biopharmaceuticals (a.k.a. Biosimilars / Biogenerics / Follow-on biologics [FOBs] ).

The worldwide biopharmaceutical market was estimated at over $50 billion in 2004 (Biopharma). Biopharmaceuticals are a growing field. The rate of new products being approved has increased steadily, more than doubling from the 1990s through 2005 (Bioplan 2006 and Nature 2004). A series of key products developed in the 1980s and 1990s with sales exceeding $30 billion are predicted to remain the dominant revenue generators over the coming years (Nature Biotech., 2004). All of Viropro’s targeted biogenerics are among these key products.

Technology and Strategic Alliances

Viropro now holds a versatile technology platform with an exclusive license portfolio. This is a result of strong partnerships with BRI through an agreement that includes the use of a proprietary promoter that significantly enhances the yield of recombinant proteins.

Viropro's platform technology allows it to develop manufacturing processes for common biotech products that are already off patent or for which patent expiration is imminent. The platform also allows the Company to contracts with biotechnology and biopharmaceutical manufacturing companies for product development and also develop or co-develop new products with partnering companies.

We believe our strength is in our technological platform, i.e., the intellectual property, know-how and rights that allow us to quickly develop high quality biopharmaceutical manufacturing processes at low cost. We believe our technological platform will allow us to develop more efficient manufacturing processes than those of our competitors who most often use technologies dating to the 1980s and 1990s. Additionally, Viropro’s leadership team has a strong international network of contacts, which enables Viropro to acquire and out-license technologies and further the development goals of the Company.

In order to strengthen and expand Viropro's manufacturing and development capabilities, a partnership agreement was signed in 2007 with BRI for scale-up of process development. This agreement allows the Company to benefit from BRI's proven expertise in recombinant protein process development and scale-up. With this agreement, the Company has an advantageous R&D leverage that minimizes its R&D expenditure and allows for a greater focus on development of novel products such as monoclonal antibodies. Viropro’s productive collaboration with BRI allows the Company to benefit from the advantages of BRI’s infrastructure and expertise, its highly specialized equipment for applied biotech, and its network of skilled scientists and technicians to complement Viropro’s own. On October 26, 2006, Viropro signed a second agreement with BRI for the use of powerful inducible expression systems developed and patented by BRI. Viropro anticipates signing new license agreements with BRI in the near future for the production of other therapeutic human proteins including cytokines and monoclonal antibodies.

A Memorandum of Understanding, or MOU, was signed on April 26, 2007 with Intas for the production of an undisclosed high value therapeutic product. Under the terms of the MOU, Intas would pay Viropro a licensing fee for the development and technological transfer of the manufacturing process, and Viropro would receive royalties based on net sales. On September 21, 2007, the Final Collaborative Research, Development and License Agreement relating to the Intas MOU was signed. Development of the product is now being conducted by Intas. A start date for production and marketing has not yet been determined.. .

In December 2008, BPD purchased a majority stake in Viropro in a $1 Million (U.S.) private placement. In the course of the 2009 fiscal year, Intas, BPD and the Company sought to make VIROPRO, INC. a holding company with VPRI and BPD as operating subsidiaries. Thus the prior transaction giving control to BPD was rescinded and all shares previously issued to BPD were issued to Intas, making Intas the direct controlling shareholder of VIROPRO, Inc. and making BPD a wholly-owned subsidiary of VIROPRO, INC.

Additional Industry Data

The size of the pharmaceutical industry was estimated at approximately $820 billion in 2009 according to the U.S. National Association of Pharmaceutical Representatives (NAPRx) . Of this, biopharmaceutical products made up about $100 billion as of the end of 2009 (Source: Hospira). The biopharmaceutical segment is one of the fastest growing segments and is commonly said to be the future of the pharmaceutical industry.

Leading Biological Products 2009

Brand	Generic	Company	2009 Sales in Millions		2008 Sales in Millions
Enbrel	Etanercept	Amgen / Wyeth	$	6,580	$	6,490
Remicade	Infliximab	Centocor / Schering Plough	$	5,934	$	5,335
Avastin	Bevacizumab	Genenetech / Roche	$	5,777	$	4,484
Rituxan / MabThera	Rituximab	Genenetech / Roche /Biogen-IDEC	$	5,653	$	5,099
Humira Pen	Adalimumab	Abbott / Eisai	$	5,488	$	4,521
Epogen / Procrit / ESPO	Epoetin Alpha	Amgen / Ortho / Janssen-Cilag / Kyowa Hakko	$	5,033	$	5,123
Herceptin	Trastuzumab	Genentech / Roche / Chugai	$	4,890	$	4,384
Lantus	Insulin glargine	Sanofi-Aventis	$	4,185	$	3,130
Neulasta	Pegfilgrastim	Amgen	$	3,355	$	3,318
Aranesp	Darbopoetin	Amgen / Kyowa Hakko	$	2,871	$	3,334
			$	49,766	$	45,218

Source: La Merie report – Top 20 Biologics 2009

Products, Goals and Objectives

Therapeutic protein products are the primary reason for the boom in biotech that occurred during the mid-1990s to late 2000s. Monoclonal antibodies (a specific class of therapeutic proteins) posted sales of $14.5 billion in 2005 (The Future of Monoclonal Antibody Therapeutics, Business Insights, 2006), and it is estimated that in 2008 they accounted for 32% of all biotech revenue. With a considerable portion of the therapeutic protein sector having lost patent protection prior to or during 2010, there is a major opportunity in the technology transfer of therapeutic proteins throughout the world.

Viropro’s goals and objectives are as follows:

	●	To develop and out-license manufacturing processes for biogenerics already in the public domain as soon as patent protection expires for various biopharmaceuticals;

	●	To develop new biopharmaceutical products with various partners (contingent upontotal development cost coverage);

	●	In the short term, to obtain recurring revenue;

	●	To obtain 15 contracts for product development in Viropro’s Clone-to-Clinic vertical by 2015;

Viropro is focused on the development and transfer of “in-licensing” leading technological processes for the manufacture of high quality biopharmaceuticals. Consistent with Viropro’s 2005 Strategic Plan, the business strategy continues to be targeting emerging, unserved markets with high potential by transferring technologies and know-how to pharmaceutical partners in those markets worldwide with a particular focus upon Asia (primarily India) and South America..

Administrative Overhead

The Company plans to maintain low administrative and overhead costs to ensure that funds are available for development activities and to produce maximum value for its shareholders. Research and Development work will be subcontracted to BRI which, in turn, is expected to subcontract to university laboratories for experimental studies or to specialized companies for GMP manufacturing, toxicology and clinical studies. By forming the optimal research and development work relationship between VPRI and BPD, Viropro seeks to minimize capital expenditures, generate results quickly and with a high degree of confidence in those results.

Development

All the research and development procedures, from the build-up of biological systems to large-scale industrial production are done in close collaboration with key partners with whom Viropro has established strategic alliances:

	·	As indicated above (see “Technology and Strategic Alliances”), an alliance was formed with the Biotechnology Research Institute of the National Research Council Canada (“BRI” located in Montreal, Canada). This alliance gives Viropro access to expertise as well as state-of-the-art equipment and facilities for bio-process innovation and purification process development as well as the scalability of bioprocesses under industrial scale conditions.

	·	An agreement similar to the Intas Agreement was signed by the Company with Spectrum Pharmaceuticals of Irvine, California in January 2011.

	·	Other negotiations are ongoing with companies specializing in providing clients and partners with industrially adapted biological material as well as offering high level scientific consulting services for the optimization of specific steps in the development of bioprocesses.

Viropro believes that there is a great opportunity for growth by locating facilities in emerging markets to gain market share by being “on the ground”; local knowledge and access to market in specific geographic areas will represent a considerable strategic advantage. Viropro has identified certain products that it believes are capable of generating short to medium-term profits and, whilewell-proven to do so in developed markets, there has not been large-scale manufacturing in in emerging markets, where there is an important and growing demand, and significant potential for Viropro.

Competition

Viropro’s management team has chosen to actively engage in the biotechnology emergent sector by entering into geographic markets not serviced by large multinational pharmaceutical companies. By sourcing partners in target countries where Viropro has identified market potential, the Company can have an active presence and thorough knowledge of these markets, particularly potential customers, suppliers, investors and government regulatory agencies.

Third quarter events

The Alpha Acquisition

As previously reported, in February 2011, Viropro acquired Alpha Biologics Sdn. Bhd. Located in Penang, Malaysia in an all-stock transaction. Acquisition was paid through issuance of 525,000,000 shares valued at US$0.04 each, representing a total value of US$21 million. The offer and sale of the shares was made to a non-US person pursuant to Rule 903(b) (3).

Alpha Biologics is a GMP bio-manufacturing company with a state-of-the-art advanced GMP mammalian cell clinical production facility located in the Penang Science Park. FDA design-reviewed, built and validated by industry experts in Europe, this 5,000m2 plant is ideally designed for the manufacture of biologics drugs (including bio-similars) for pre-clinical and Phase I, II and III clinical trials. Alpha Biologics provides its clients with supplies of mammalian cell proteins, such as monoclonal antibodies or recombinant proteins, or other cell-derived products.

Alpha Biologics’ world-class facility is now completed and ready for its GMP certification. Over the next few months, the plant will undergo due diligence to obtain its certification under the Pharmaceutical Inspection Cooperation Scheme (PIC/s), which is a global harmonization program for Good Manufacturing Practices (GMP) with 39 member countries and agencies, including the U.S. FDA. EMEA accreditation will follow thereafter. This requires funding as outlined below (See “Liquidity and Capital Resources - Material Changes in Financial Condition and Longevity ”).

Because most, if not all, of Viropro’s major contract manufacturing competitors are located in the US and Europe, and costs associated with those facilities, due to their locations and size, are much higher than the costs associated with Alpha, Alpha will be able to compete aggressively on pricing while still achieving the gross and net margins required. However, Alpha requires funding for working capital to prepare for its GMP accreditation and commercialization of its products. Alpha will ensure the highest standards of production and regulatory compliance.

Subsequent events

In October 2011, Cynthia Ekberg Tsai was appointed Chairman of the Board.

In March 2012, the Board of Directors created two Committees: Audit and Compensation. Audit Committee is chaired by Emilio Binavince with Cynthia Tsai as member, and the Compensation Committee is chaired by Cynthia Tsai with Emilio Binavince as member.

In April 2012, the Cambridge UK operation was shut down for an undetermined time period as it continued to accumulate deficits.

In May 2012, The Malaysian Employee Providence Fund filed a lawsuit against Alpha Biologics Bhd Sdn for non payment of employee benefits. Court procedures are set for July 5, 2012.

In June 2012, a form 13-D was filed on behalf of the majority shareholder requesting the voluntary resignation of Dr Rajiv Datar as CEO of Viropro.

Results of Operations

Nine months Ended September 30, 2011and 2010

Revenues and Operating Loss — Revenues were $758,433 for the first nine months of 2011 compared to $397,280 for the same period in 2010. $703,668 came from BPD (83.8%) while the rest came from Alpha. Both BPD and Alpha’s results are in line with expectations. The Malaysian operation will generate revenues once clinical trials can be performed there which is contingent upon the plant being fully upgraded and receiving Certification under the Pharmaceutical Inspection Cooperation Scheme (PIC/s).

Operating expenses increased 94 % as a result of the consolidation from $1,258,418 to 2,445,046; however, SG&A expenses grew only 57% reflecting lower cost of operation in Malaysia. Consulting fees grew to $812,526 from $219,918 reflecting cost of producing all missing financial statements.

Net Loss totals before the write-off of Goodwill were $1,923,213 compared to $873,535 in 2010. Interest expenses of $232,100 at Alpha Biologics increased the total non-operating expenses to $236,600 compared $12,397 in 2010

Three Months Ended September 30, 2011and 2010

This is the first quarter in which Alpha Biologics Bhd Sdn’s numbers are being consolidated into Viropro’s accounting.

Revenues rose to $304,261 up from $175,851 for the same period last year. Alpha contributed $54,765 to this increase while the remainder, $73,645, is attributable to BPD. Consulting fees for the nine month to 30 September 2011 were $812,526. This compares to $219,918 for the nine months to 30 September 2010. .(

Liquidity and Capital Resources — Material Changes In Financial Condition and Longevity

As of September 30, 2011, the Company had a working capital deficiency of $2,870,933 and $119,250 in cash. Starting in April 2011, Viropro initiated a private placement of $750,000. At this point, as revenues are not sufficient to cover expenses, one viable alternative is for the Company to raise funds through equity issues.

The Company will require substantial additional funding in order to attain profitability. Its facilities in California and the UK require expansion to be able to bid for more important and larger service requests. Further, Viropro expects $3.9 million dollars will be required in April 2012 to upgrade the Malaysian operation to the cGMP certification, and because the first client contracts with Alpha will not immediately generate cash flow, it is anticipated that there will be a continued cash deficiency until the middle of 2013 requiring an additional $1.5 million dollars to close the gap. However, the Company believes it will have available cash to fund operations at least through 2012 based on current business and operational plans -- assuming new financings and collaborations are entered. Its capital requirements beyond that will depend on a number of factors including cost of new technology and development programs and additional personnel costs. Further, these requirements may change at any time due to technological advances or competition from other companies.

The Company will continue to explore and consider new opportunities for funding its operations and activities through business partnerships supported by its knowledge, human resources and intellectual property. Other funding sources may include proceeds from the sale of equity securities and possibly loans from financial institutions. The Company cannot assure that adequate funding will be available or, if available, that it will be available on acceptable terms. Any shortfall in funding could result in having to curtail the services we offer.

The Company expects to continue to incur substantial losses through at least the next two years and may incur losses in subsequent periods. The amount and timing of its future losses are highly uncertain. Its ability to achieve and thereafter sustain profitability will be dependent upon, among other things, increasing cash flow from service agreements, generating economies of scale from central purchasing procedures, a general increase in business undertakings from increased exposure of both its streamlined services and work synergy. Viropro believes this synergy can be generated by constant exchange of information on work procedures among its operating subsidiaries.

Plan of Operations

As indicated above, the Company will focus on the development and transfer of “in-licensing” leading technological processes for the manufacturing of high quality biopharmaceutical products. Viropro focuses on one main line of therapeutic proteins, monoclonal antibodies such as Anti-CD20.

At the same time, the Company will be implementing its new business model that calls for Contractual Research and Manufacturing Services offered through complementary subsidiaries. The anticipated typical scenario would be that microbiology would be performed at the Montreal facility, and then development would take place at either the Cambridge or San Diego facilities before going into clinical production in Malaysia. All research and development procedures will be done in collaboration with the partners with whom Viropro has established its strategic alliances. Priority will be given to further development of these alliances, establishing the optimal product line, methods of manufacturing, distribution, and signing joint venture agreements in the markets we are targeting.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

Not applicable.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

As of September 30, 2011, the Company’s management, under the direction of its CEO and CFO, evaluated the effectiveness of the design and operation of the Company’s disclosure controls and procedures as defined in Rule 13a-15(e) of the Securities Exchange Act of 1934, as amended. Based on this evaluation, and the identification of material weaknesses in internal control over financial reporting as described below, the CEO and CFO concluded that the Company’s disclosure controls and procedures were insufficient as of September 30, 2011.

Internal Control over Financial Reporting

Viropro recognizes that its internal controls over financial reporting are meant to provide reasonable assurance regarding the reliability of its financial reporting, and the preparation of the consolidated financial statements for external purposes should be done in accordance with generally accepted accounting principles as defined in the Securities Exchange Act.

Because of its inherent limitations, internal controls over financial reporting may not entirely prevent or detect misstatements and, even when determined to be adequate, they can only provide reasonable assurance with respect to accurate financial statement preparation and presentation. Also, projections of any evaluation of effectiveness to future reporting periods are subject to the risk that controls may become inadequate because of changes in conditions or that the degree of compliance with policies or procedures may deteriorate.

A material weakness is a control deficiency, or combination of control deficiencies, such that there is a reasonable possibility that a material misstatement of the annual or interim financial statements will not be prevented or detected on a timely basis.

The Company acquired Biologics Process Development, Inc. (“BPD”) in April 2010. Thereafter, the Company’s management began to integrate BPD into the Company and improve an expand its internal controls structure, policies and procedures. Prior to its acquisition of BPD, BPD operated on a cash basis of accounting rather than an accrual basis. Following the acquisition, Viropro hired an external accountant specifically to assist with t moving BPD to accrual basis accounting . Since December 31, 2010, the Company has implemented a number of other changes in internal controls over financial reporting, as described in the next paragraph, to remediate material weaknesses. Management believes that its internal controls over financial reporting has improved.

Changes in Internal Control Over Financial Reporting

There were a number of changes in the Company’s internal controls over financial reporting during the quarter ended September 30, 2011 that have materially affected, or are reasonably likely to materially affect, its internal controls over financial reporting due to the BPD acquisition and the material weaknesses described above. As explained above, prior to the acquisition, BPD used cash basis accounting, and Viropro undertook to changing BPD to accrual basis accounting. Additionally, since the acquisition of BPD was consummated in April 2010, the Company has made changes to the internal control procedures of BPD to strengthen such controls. For example, during 2011 the Company (i) hired an external accounting firm from San Diego to handle accounting data coming from BPD, (ii) hired a U.S. CPA firm in Long Island, New York to collect and assemble accounting information coming from Viropro and each of its operating subsidiaries (iii) increased the oversight provided by Viropro’s executives over BPD’s operations and financial activities and (iv) instituted procedures to more accurately identify direct costs incurred for each subsidiary’s contracts.

Also, following the acquisition of Alpha Biologics Sdn Bhd, other changes were implemented during the 3 rd quarter of 2011. These changes addressed the transfer of information from Alpha’s Malaysian and UK operations to Viropro Inc., access to banking information and general ledger entries, all such information is now supervised directly by the CFO, before being submitted to the external CPA firm to prepare the quarterly statements and to its external auditor for quarterly review.

In addition, the Company is planning to hire another full time employee to further strengthen these functions, which will assist in the process of implementing additional effective internal controls over processes at the corporate level as well as in each subsidiary.

PART II - OTHER INFORMATION

Item 1. Legal Proceedings.

On June 21, 2009 a $5,000 Securecap convertible debenture holder initiated procedures against the Company to recover capital due at maturity. Management of the Company had offered to the holder, as it had done with all Securecap Convertible Debenture holders, to convert its debenture into common shares at a lower price than the initially set price. The claim was filed in the Small Claims Court of Montreal, District of Longueuil, Province of Quebec, Canada under file no 505-32-025648-099. Company has entered into agreement with plaintiff for a settlement by issuance of 166,667 shares. However these shares have not yet been issued.

On July 13, 2009 HKDP, a supplier of Public Relations Services to Viropro, filed a lawsuit claiming $37,991.95 for an unpaid bill. Management had contested the claim and requested a Stay of Execution. In January 2011, management had resumed discussions to enter into a settlement but the claiming party never produced any settlement request.

In August 2011, IAS Equity was granted judgment by default in a NY Court Procedure filed against Viropro, Inc. for non payment of an outstanding balance of $25,000 with respect to its Consulting Agreement with Viropro. . Discussions between management and IAS’ representative are being held to resolve the matter.

In April 2012, the Cambridge UK operation was shut down for an undetermined time period as it continued to accumulate deficits.

In May 2012, The Malaysian Employee Providence Fund filed a lawsuit against Alpha Biologics Bhd Sdn for non payment of employee benefits. Court procedures are set for July 5, 2012.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

On July 5, 2011, 100,000 restricted shares were issued to Bernard Twyford Raymond as payment for consultant services,

On July 11, 2011, as payment for the acquisition of Alpha Biologics Bhd Sdn, 340,097,124 restricted shares were issued to Springhill Bioventures Sdn. Bhd., 183,844,211 restricted shares were issued to THG Capital Sdn. Bhd., and 1,058,665 restricted shares were issued to Michelle Leanne Peake.

On July 22, 2011, 1,000,000 restricted shares each were issued to both Cynthia Tsai and Andrew Boico as part of their consultancy agreement.

Item 3. Defaults Upon Senior Securities.

The convertible debenture issued on March 1, 2007 came to maturity on March 1, 2009. Whereas all but $30,000 of this debenture was converted, this amount remains outstanding and is payable to the holders (see Note 7 of the Financial Statements).

Item 4. Submission of Matters to a Vote of Security-Holders.

None.

Item 5. Other Information.

The disclosures set forth in Part II , Item 2 of this quarterly report are incorporated by reference under this Item 5.

Item 6. Exhibits


Number		Title of Exhibit
31.1		Certification pursuant to Rule 13a-14(a) and Rule 15d-14(a)
31.2		Certification pursuant to Rule 13a-14(a) and Rule 15d-14(a)
32.1		Certification pursuant to 1350, Chapter 63, Title 18 of United States Code
32.2		Certification pursuant to 1350, Chapter 63, Title 18 of United States Code

101.INS		XBRL Instance*
101.SCH		XBRL Schema*
101.CAL		XBRL Calculation*
101.DEF		XBRL Definition*
101.LAB		XBRL Label*
101.PRE		XBRL Presentation*

* The XBRL related information in Exhibit 101 shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to liability of that section and shall not be incorporated by reference into any filing or other document pursuant to the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such filing or document.

In accordance with the requirements of the Security Exchange Act of 1934, the Registrant has caused this report to be signed on its behalf by the undersigned, duly authorized.

VIROPRO, INC.

/s/ Rajiv Datar

Rajiv Datar, President & CEO

Dated: June 30, 2012

Viropro (CE) (USOTC:VPRO)
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