Risk Factors

An investment in our securities is speculative and involves a high degree of risk.  Please carefully consider the following risk factors, as well as the possibility of the loss of your entire investment, before deciding to invest in our securities.

Risks Related to This Offering and Our Stock

The tangible book value of our common stock after the offering will be lower than the offering price, which will result in immediate and substantial dilution for investors.

Even if we sell all 500,000 shares that we are offering, investors purchasing shares of our common stock in this offering will incur immediate and substantial dilution of their investment of approximately $0.57 per share, or 57% of the offering price, based upon our adjusted net tangible book value as of June 30, 2007.  If we sell fewer than 500,000 shares, the dilution will be even greater.  To the extent that currently outstanding options to purchase our common stock are exercised, there will be further dilution to investors acquiring shares of common stock.  

Future issuances of our common stock could dilute current shareholders and adversely affect the market if it develops.

We have the authority to issue up to 50,000,000 shares of common stock and 10,000,000 shares of preferred stock and to issue options and warrants to purchase shares of our common stock, without shareholder approval.  These future issuances could be at values substantially below the price paid for our common stock by investors in this offering, which would result in significant dilution to those investors.  In addition, we could issue large blocks of our common stock to fend off unwanted tender offers or hostile takeovers without further shareholder approval, which would not only result in further dilution to investors in this offering but could also depress the market value of our common stock, if a public trading market develops.

We may issue preferred stock that would have rights that are preferential to the rights of the common stock that could discourage potentially beneficial transactions to our common stockholders.

An issuance of additional shares of preferred stock could result in a class of outstanding securities that would have preferences with respect to voting rights and dividends and in liquidation over the common stock and could, upon conversion or otherwise, have all of the rights of our common stock.  Our Board of Directors' authority to issue preferred stock could discourage potential takeover attempts or could delay or prevent a change in control through merger, tender offer, proxy contest or otherwise by making these attempts more difficult or costly to achieve.  The issuance of preferred stock could impair the voting, dividend and liquidation rights of common stockholders without their approval.

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There is currently no market for our common shares, and investors may be unable to sell their shares for an indefinite period of time.

There is presently no market for our common shares.  There is no assurance that a liquid market for our common shares will ever develop in the United States or elsewhere, or that if such a market does develop that it will continue.  Accordingly, an investment in common shares of our Company should only be considered by those investors who do not require liquidity and can afford to suffer a total loss of their investment.  An investor should consult with professional advisers before making such an investment.

Over-the-counter stocks are subject to risks of high volatility and price fluctuation .

We have not applied to have our shares listed on any stock exchange or on the NASDAQ Capital Market, and we do not plan to do so in the foreseeable future.  As a result, if a trading market does develop for our common stock, of which there is no assurance, it is likely that our shares will trade on the over-the-counter (“OTC”) market.  The OTC market for securities has experienced extreme price and volume fluctuations during certain periods.  These broad market fluctuations and other factors, such as new product developments and trends in our Company's industry and the investment markets generally, as well as economic conditions and quarterly variations in our results of operations, may adversely affect the market price of our common stock and make it more difficult for investors in this offering to sell their shares.

Trading in our securities will in all likelihood be conducted on an electronic bulletin board established for securities that do not meet NASDAQ listing requirements.  As a result, investors will find it substantially more difficult to dispose of our securities.  Investors may also find it difficult to obtain accurate information and quotations as to the price of, our common stock.  

Our stock price may be volatile and as a result, investors could lose all or part of their investment. The value of an investment could decline due to the impact of any of the following factors upon the market price of our common stock:

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failure to meet sales and marketing goals or operating budget;

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decline in demand for our common stock;

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operating results failing to meet the expectations of securities analysts or investors in any quarter;

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downward revisions in securities analysts' estimates or changes in general market conditions;

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investor perception of our Company's industry or prospects; and

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general economic trends.

In addition, stock markets have experienced extreme price and volume fluctuations and the market prices of securities have been highly volatile.  These fluctuations are often unrelated to operating performance and may adversely affect the market price of our common stock.  As a result, investors may be unable to resell their shares at or above the offering price.  

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Outstanding shares that are eligible for future sale could adversely impact a public trading market for our common stock, if a public trading market develops.

All of the 505,000 shares of common stock currently outstanding were offered and sold by us in private transactions in reliance upon an exemption from registration under the Securities Act. Accordingly, all of such shares are "restricted securities" as defined by Rule 144 ("Rule 144") under the Securities Act and cannot be resold without registration except in reliance on Rule 144 or another applicable exemption from registration.  In general, under Rule 144 a person (or persons whose shares are required to be aggregated), including any affiliate of ours, who beneficially owns restricted shares for a period of at least one year is entitled to sell within any three month period shares equal in number to the greater of: (i) one percent of the then outstanding shares of common stock, or (ii) the average weekly trading volume of the same class of shares during the four calendar weeks preceding the filing of the required notice of sale with the Commission.  The seller must also comply with the notice and manner of sale requirements of Rule 144, and there must be current public information available about the Company.  In addition, any person (or persons whose shares are required to be aggregated) who is not, at the time of sale, nor during the preceding three months, an affiliate of the Company, and who has beneficially owned restricted shares for at least two years, can sell such shares without regard to notice, manner of sale, public information or the volume limitations described above.  No shares of our common stock are currently eligible for resale under Rule 144.

Upon completion of this offering, we intend to file a registration statement on Form S-8 under the Securities Act to register shares of common stock reserved for issuance under our Equity Incentive Plan.  Persons who are not affiliates, and who receive shares that are registered under this registration statement, will be able to resell those shares in the public market without restriction under the Securities Act.  This registration statement will become effective immediately upon filing.

No prediction can be made as to the effect, if any, that future sales of restricted shares of common stock, or the availability of such common stock for sale, will have on the market price of the common stock prevailing from time to time. Sales of substantial amounts of such common stock in the public market, or the perception that such sales may occur, could adversely affect the then prevailing market price of the common stock.

If a public trading market for our shares develops, owners of our common stock will be subject to the “penny stock” rules.  

Since our shares are not listed on a national stock exchange or quoted on the Nasdaq Market within the United States, if a public trading market develops, of which there can be no assurance, trading in our shares on the OTC market will be subject, to the extent the market price for our shares is less than $5.00 per share, to a number of regulations known as the "penny stock rules".  The penny stock rules require a broker-dealer to deliver a standardized risk disclosure document prepared by the SEC, to provide the customer with additional information including current bid and offer quotations for the penny stock, the compensation of the broker-dealer and its salesperson in the transaction, monthly account statements showing the market value of each penny stock held in the customer's account, and to make a special written determination that the penny stock is a suitable investment for the investor and receive the investor’s written agreement to the transaction.  To the extent these requirements may be applicable they will reduce the level of trading activity in the secondary market for our shares and may severely and adversely affect the ability of broker-dealers to sell our shares, if a publicly traded market develops.

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We do not expect to pay cash dividends in the foreseeable future.  Any return on investment may be limited to the value of our stock.

We have never paid any cash dividends on any shares of our capital stock, and we do not anticipate that we will pay any dividends in the foreseeable future.  Our current business plan is to retain any future earnings to finance the expansion of our business.  Any future determination to pay cash dividends will be at the discretion of our Board of Directors, and will be dependent upon our consolidated financial condition, results of operations, capital requirements and other factors as our board of directors may deem relevant at that time.  If we do not pay cash dividends, our stock may be less valuable because a return on your investment will only occur if our stock price appreciates.

All of our assets have been pledged as collateral to secure the repayment of loans under a Credit Agreement with a related third party.  If we default in those loans, our assets would be subject to risk of forfeiture.

All of our assets have been pledged as security in the Credit Agreement we entered into with John Overturf, Jr., a related party.  If we are unable to pay any of the debt incurred under the Credit Agreement in a timely fashion or otherwise breach any of the terms of the Credit Agreement (and Mr. Overturf demands payment in cash rather than in shares of our common stock), our assets would be subject to foreclosure by Mr. Overturf.  Should foreclosure occur, it is likely that we would be forced to discontinue operations and our interest in the assets could be forfeited.  As of June 30, 2007, we had drawn an aggregate of $15,000 in advances under the Credit Agreement.

If the Company were to dissolve or wind-up, holders of our common stock may not receive a liquidation distribution.  

If we were to wind-up or dissolve B2 Health, Inc. and liquidate and distribute our assets, our shareholders would share ratably in our assets only after we satisfy any amounts we would owe to our creditors.  If our liquidation or dissolution were attributable to our inability to profitably operate our business, then it is likely that we would have material liabilities at the time of liquidation or dissolution.  Accordingly, we cannot give you any assurance that sufficient assets will remain available after the payment of our creditors to enable you to receive any liquidation distribution with respect to any shares you may hold.

Changes in the corporate and securities laws and regulations are likely to increase our costs.

The Sarbanes-Oxley Act of 2002 (SOX), which became law in July 2002, has required changes in some of our corporate governance, securities disclosure and compliance practices. In response to the requirements of SOX, the SEC and major stock exchanges have promulgated new rules and listing standards covering a variety of subjects. Compliance with these new rules and listing standards that are likely to increase our general and administrative costs, and we expect these to continue to increase in the future. In particular, we will be required to include the management and auditor reports on internal control as part of our annual report for the year ending December 31, 2007 pursuant to Section 404 of SOX. We are in the process of evaluating our internal control systems in order (i) to allow management to report on, and our independent auditors to attest to our internal controls, as required by these laws, rules and regulations, (ii) to provide reasonable assurance that our public disclosure will be accurate and complete, and (iii) to comply with the other provisions of

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Section 404 of SOX.  We cannot be certain as to the timing of the completion of our evaluation, testing and remediation actions or the impact these may have on our operations.  Furthermore, there is no precedent available by which to measure compliance adequacy.  If we are not able to implement the requirements relating to internal controls and all other provisions of Section 404 in a timely fashion or achieve adequate compliance with these requirements or other requirements of SOX, we might become subject to sanctions or investigation by regulatory authorities such as the SEC or NASD. Any such action may materially adversely affect our reputation, financial condition and the value of our securities, including our common stock. We expect that SOX and these other laws, rules and regulations will increase legal and financial compliance costs and will make our corporate governance activities more difficult, time-consuming and costly. We also expect that these new requirements will make it more difficult and expensive for us to obtain director and officer liability insurance.

  If we fail to maintain an effective system of internal controls, we may not be able to accurately report our financial results or prevent fraud. As a result, current and potential shareholders could lose confidence in our financial reporting, which would harm our business and the trading price of our stock.

     Effective internal controls are necessary for us to provide reliable financial reports and effectively prevent fraud. If we cannot provide financial reports or prevent fraud, our business reputation and operating results could be harmed. Inferior internal controls could also cause investors to lose confidence in our reported financial information, which could have a negative effect on the trading price of our stock.

Risks Related to Our Business

We are subject to risks associated with a new business

Our operations are subject to all of the risks inherent in a start-up business enterprise.  These risks include the absence of a substantial operating history, shortage of cash, under-capitalization and lack of experience in our chosen industry.  We expect to encounter various problems, expenses, complications and delays in connection with the development of our business.  The profit potential of our business model is unproven and there can be no assurance that our services will achieve commercial acceptance.

We have recently emerged from being a development stage company with a history of operating losses.  

     We were incorporated on March 8, 2006.  For the nine months ended June 30, 2007, we had $10,998 in sales, and we recorded a cumulative operating loss of approximately $(65,852).  We expect to incur additional losses until sufficient sales of our Backroller Intersegmental Traction products are achieved.  We have not yet commenced manufacturing and shipping of the Backroller in substantial volumes. Our limited operating history makes the prediction of future operating results difficult or impossible to make. There can be no assurance that our future revenues will ever be significant or that our operations will ever be profitable.

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Our limited operating history makes it difficult to evaluate our prospects and the merits of investing in our securities.

     Our business is at an early stage of development.  We have not begun to generate significant revenues.  Our business will require significant additional investment in inventory and marketing.  As a general guideline, we anticipate expending approximately $6,000 per month on our day-to-day operations for fiscal 2007.  Should our efforts to market and promote ourselves to distributors, health care practitioners and end-users be unsuccessful, we may not attract enough customers to purchase the Backroller from us.  Accordingly, there can be no assurance that our future revenues will ever be significant or that our operations will ever be profitable.

Our trademarks, including the name “Backroller” and other intellectual property rights do not provide us with protection against competition .

     We rely heavily on developing brand recognition for the Backroller Intersegmental Traction Bed (the “Backroller”) and claim common law trademark protection for its name.  We have also recently applied to the United States Patent and Trademark Office to register our trademark in the name Backroller.

     Additionally, we rely upon a combination of laws and contractual restrictions, including restrictions contained in confidentiality agreements, to establish and protect our rights to any intellectual property that we create.  Any infringement of our proprietary rights could result in significant litigation costs, and any failure to adequately protect our proprietary rights could result in our competitors offering similar products, potentially resulting in loss of a competitive advantage and decreased revenues. Attempts may be made to copy or reverse engineer aspects of our products or to obtain and use information that we regard as proprietary.  Accordingly, we may not be able to prevent misappropriation of our technology or deter others from developing similar technology.  Furthermore, policing the unauthorized use of our products is difficult.  Litigation may be necessary in the future to enforce our intellectual property rights or to determine the validity and scope of the proprietary rights of others.  This litigation could result in substantial costs and diversion of resources and could significantly harm our business.  Nonetheless, we do not believe that intellectual property rights, including trademark and copyright laws form a basis for significant competitive advantage or protect us from intense competition.

We may not be able to finance the development of our business, or the terms of future financings could be disadvantageous to our shareholders.

     Our ability to satisfy our future capital requirements and implement our expansion plans will depend upon many factors, including the financial resources available to us, the expansion of our sales and marketing efforts and the status of competition.  However, the exact amount of funds that we will require will depend upon many factors, and it is possible that we will require additional financing prior to such time.  There can be no assurance that additional financing will be available to us on acceptable terms, or at all.  If additional funds are raised by issuing equity securities, further dilution to the existing stockholders will result.  If adequate funds are not available, we may be required to delay, reduce or eliminate our programs or obtain funds through arrangements with partners or others that may require us to relinquish rights to certain of our products, technologies or other assets.  Accordingly, the inability to obtain such financing could have a material adverse effect on our business, financial condition and results of operations.

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We are dependent on a limited number of products.  All of our sales have been derived from sales of our existing Backroller Intersegmental Traction table.

     Although we plan to develop products in addition to the Backroller, there can be no assurance that these development efforts will be successful or, if successful, that resulting products will receive market acceptance, generate significant sales or result in gross profits.  We believe that success in the general back and spinal pain market is somewhat dependent on product acceptance by orthopedists and chiropractors.  Our future operating results, particularly in the near term, are significantly dependent upon market acceptance of the Backroller.  Because all of our current sales are derived from the Backroller, failure to achieve broad market acceptance of the Backroller as a result of competition, technological change or other factors or the failure to successfully market any new or enhanced versions of existing products would have a material adverse effect on our business, operating results and financial condition.

We may not be able to keep up with rapid technological change and expensive technological innovation.

     The back and spinal pain management market is characterized by rapid, technological innovation and change.  Many companies are engaged in research and development of devices, drugs and alternative methods to relieve back pain, enhance spinal mobility and improve sleep.  New technologies may be developed which may render our products obsolete and non-competitive.  If we cannot keep pace with the technological developments and become uncompetitive, we may not be able to generate sufficient revenues, or any existing revenues may materially decrease.  

We face significant competition in the markets where we operate from competitors with greater financial resources and established operations and revenues, which make it difficult to attract customers and obtain a market share.

     The back and spinal pain management market is very competitive and competition is likely to increase.  Increased competition may result in price cuts, reduced gross margins and loss of market share, any of which could seriously harm our business.  Many of our competitors have, and potential competitors may possess, longer operating histories and significantly greater financial, technical, personnel and other resources than us.  Competitors and potential competitors may also have larger, more established research and development departments and greater name and brand recognition than we currently possess.  These greater resources may permit them to implement extensive advertising, sales, promotions and programs that we may not be able to match.  Better financed competitors may also have greater success in future research and development efforts.  As these competitors enter the field, our sales growth may fail to increase, despite its efforts to continue to design and manufacture superior products.  There can be no assurance that we will have the ability to compete successfully in this environment.  If we are unable to compete successfully, our business will be seriously harmed.

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We have limited human resources; we need to attract and retain highly skilled personnel and consultants; and we may be unable to manage our growth with our limited resources effectively.

     We expect that the expansion of our business may place a strain on our limited managerial, operational, and financial resources.  We will be required to expand our operational and financial systems significantly and to expand, train and manage our work force in order to manage the expansion of our operations.  Our future success will depend in large part on our ability to attract, train, and retain additional highly skilled executive level management, logistics, and sales personnel.  We may not be successful in attracting and retaining qualified personnel on a timely basis, on competitive terms or at all.  Further, our ability to manage our growth effectively will require us to continue to improve our operational, financial and management controls, reporting systems and procedures, to install new management information and control systems and to train, motivate and manage employees.  If we are unable to manage growth effectively, our operating results will suffer.  

     Our success will depend, to a large degree, upon the efforts and abilities of our officers and key management employees, including, without limitation, John Quam, our President and member of the Board of Directors (the “Board”), and John Overturf, Jr.  For direct knowledge of the industry, extensive research experience and professional administration skills, we rely on Dr. Glynn Hopkins, a chiropractic consultant, and Rusty Munn, the manufacturing designer of the Backroller.  The loss of the services of one or more of our key consultants could have a material adverse effect on our operations.  We have no employment agreements with any of our employees, and do not maintain a key man life insurance policy on any employee; nor do we have any written consulting agreements with Dr. Hopkins or Mr. Munn.

We depend on our suppliers for our components and raw materials, and our production or operating margins would be harmed if these suppliers are not able to meet our demand and reasonable alternative sources are not available.

     The components used to make the Backroller come from various suppliers.  The Backroller is comprised of many elements, all of which are available as commodity products.  We believe that each of these components is readily available in sufficient quantities from multiple sources on commercially accepted terms.  However, any substantial increase in the price or interruption in the supply of these materials, or if one or more of our suppliers are unable to meet our demand for our components, and if we are unable to obtain alternative sources, our ability to maintain timely and cost-effective production of the Backroller would be seriously harmed and our operating results would suffer.  An inability to obtain adequate supplies of component parts could significantly delay the manufacture and marketing of the Backroller and other future products.  We may have to seek alternative sources of supply or abandon or sell product lines on unsatisfactory terms.  We may not be able to enter into alternative supply arrangements on commercially acceptable terms, if at all.  In addition, as we do not have written agreements with any of our suppliers, they may stop manufacturing our components at any time.  

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We rely on third parties to manufacture our products and our reputation and operating results could be harmed if they fail to produce quality products in a timely and cost-effective manner and in sufficient quantities.  

     We do not currently have manufacturing facilities or personnel to independently manufacture the Backroller.  We depend on third-party manufacturers to produce the Backroller in a timely fashion, at satisfactory quality and cost levels.  If our manufacturers fail to produce quality finished Backrollers on time, at expected cost targets and in sufficient quantities, our reputation and operating results would suffer.  In addition, as we have no long-term agreements with our manufacturers, we do not have firm commitments on the timing, pricing and quality of the manufacturing process, and, they manufacturers may stop manufacturing for us at any time, with little or no notice.  If for any reason we are unable to obtain or retain third party manufacturers on commercially acceptable terms, we may not be able to distribute the Backroller, or other future products, as planned.  If we encounter delays or difficulties with contract manufacturers in producing or packaging the Backroller, the distribution, marketing and subsequent sales of the Backroller will be adversely affected.  There can be no assurance that the manufacturers we have engaged will be able to provide sufficient quantities of the Backroller or that the Backroller supplied will meet our specifications.  

We do not have written agreements with our manufacturers and, as a result, we could be subject to increases in component or manufacturing costs and/or delivery schedule changes which could harm our reputation and operating results.

     Cost increases for our components or manufacturing services, whether resulting from shortages of materials, labor or otherwise, including, but not limited to rising cost of materials, transportation, services, labor, commodity price increases and the impact of foreign currency fluctuations could negatively impact our gross margins.  Because of market condition and other factors, we may not be able to offset any such increased costs by adjusting the price of our products.

Any errors or defects contained in our products, or our failure to comply with applicable safety standards, could result in delayed shipments or rejection of our products, damage to our reputation and expose us to regulatory or other legal action.

     In the future, we may experience delays in releasing the Backroller, or other future products due to defects or errors in the products.  The Backroller may contain errors or defects after commercial shipments have begun, which could result in the rejection of our products by our distributors, damage to our reputation, lost sales, diverted development resources and increased customer service and support costs and warranty claims, any of which could harm our business.  Individuals could sustain injuries from our products, and we may be subject to product liability claims or lawsuits resulting from such injuries. There is a risk that these claims or liabilities may exceed, or fall outside the scope of, our insurance coverage.  Concerns about potential liability may lead us to recall voluntarily the Backroller. While we currently maintain product liability insurance, a significant product liability judgment against us or a widespread product recall, to the extent either such event is in excess of the limits of its product liability insurance, could result in substantial financial losses.  

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We rely heavily upon independent distributors to market our product.  Those distributors also market other back and spine pain relieving equipment, including traction beds, which are competitive with ours.  As a result, distributors over whom we exercise little control can significantly influence the degree to which third parties buy our products instead of products of competitive manufacturers.

     We distribute our products through a network of independent distributors for resale to trainers, physical therapists, doctors, chiropractors.  Accordingly, we depend on these distributors to sell the Backroller and to assist us in creating demand for, and promoting market acceptance of our product.  We also depend upon them to provide adequate pre-sales service to our customers.  These distributors also promote and market other back and spine pain relieving products, some of which are in competition with the Backroller.  There can be no assurance that our distributors will devote the resources necessary to provide effective sales and promotional support to us.  A disruption of our distributors, the loss of a significant customer, or the termination by any major distributor could have a material adverse impact on our sales and results of operations.   

     If for any reason we are unable to obtain or retain third party distributors on commercially acceptable terms, we may not be able to distribute the Backroller as planned.  If we encounter delays or difficulties with contract distributors, the distribution, marketing and subsequent sales of the Backroller would be adversely affected, and we may have to seek alternative sources of distribution or abandon or sell the Backroller on unsatisfactory terms.  We may not be able to enter into alternative distribution arrangements on commercially acceptable terms, if at all.  There can be no assurance that the distributors we have engaged will be able to provide sufficient distribution of the Backroller in order for us to meet our current or future obligations to our customers.

     We have no formal long-term written distribution agreements with our distributors; and most distribution arrangements can be terminated by the distributor without prior notice.  As a result, agreements with respect to price, inventory, cooperative advertising or special promotions, among other things, are subject to periodic negotiation with each distributor.  Additionally, distributors make no binding long-term commitments to us regarding purchase volumes and make all purchases by delivering on-time purchase orders.  A down-turn in the performance, a change in the terms on which we conduct business, or the loss of a single distributor, could negatively impact the timing, quality, price and sales of the Backroller and, as a result, our business and operating results could be harmed.

We do not have a written warranty policy; manufacturing defects are handled directly by us and we may experience significant returns or warranty claims.

     We offer a limited lifetime warranty on all Backrollers.  Since we have only a limited history of commercial sales of our Backroller, we have no data regarding its performance or maintenance requirements.  Accordingly, we have no basis on which we can currently predict warranty costs.  If we experience significant warranty service requirements or product recalls, potential customers may not purchase our products.  Any significant warranty service requirements or product recalls would increase our costs substantially and likely reduce the value of our brand.

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We could become subject to infringement claims by third-parties which could impair our limited capital resources and potentially result in substantial adverse judgment.  

     In recent years, there has been significant litigation in the United States and elsewhere involving patents and other intellectual property rights.  Third parties may assert patent, copyright, trademark and other intellectual property rights to technologies used in our business. Any infringement claims, with or without merit, could be time consuming, result in costly litigation, and divert the efforts of our technical and management personnel.  If we are unsuccessful in defending against these types of claims, we may be required to do one or more of the following:

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stop selling those products that use or incorporate the challenged intellectual property;

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attempt to obtain a license to sell or use the relevant technology or substitute technology, which license may not be available on reasonable terms or at all;

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redesign those products that use the relevant technology, which we may not be able to do on a timely or cost effective basis, or at all; or,

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pay substantial damages.

     In the event a claim against us is successful and we can not obtain a license to the relevant technology on acceptable terms or license a substitute technology or redesign its products to avoid infringement, our business will be significantly harmed.  A substantial uninsured judgment could force us to cease operations altogether.

The success of our business depends in large part on health care reform.

     The levels of revenues and profitability of medical device companies may be affected by the continuing efforts of governmental and third-party payers to contain or reduce the costs of health care through various means.  In the United States there have been, and we expect that there will continue to be, a number of federal and state proposals to control health care costs.  There have been a number of proposals introduced to Congress to comprehensively reform the nation’s health care system.  Some of the proposed legislation has contained measures intended to control public and private spending on health care as well as to provide universal public access to the health care system.  In addition, some of the proposed legislation included limitations on Medicare and Medicaid reimbursement for medical products and services and called for the creation of a committee to monitor and evaluate the pricing of new medical products and services.  Although no such legislation has been passed by Congress, federal, state and local officials and legislators (and certain foreign government officials and legislators) have proposed or are reportedly considering proposing a variety of additional reforms to the health care systems in their respective jurisdictions, including reforms that may affect the medical device industries.  It is uncertain what new legislative proposals, if any, might be adopted or what actions federal, state or third-party payers may take in response to any health care reform proposals or legislation.  We cannot predict the effect health care reforms may have on its business or the business of its collaborators.

     In the United States and elsewhere, sales of therapeutic pain management products are dependent in part on the availability of reimbursement from third-party payers, such as government and private

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insurance plans. These third-party payers are increasingly challenging the prices charged for medical products and services.  If we succeed in bringing one or more products to the market, there can be no assurance that these products will be considered cost effective and that reimbursement to the consumer will be available or will be sufficient to allow us to sell our products on a profitable basis.

Market acceptance of the Backroller will be adversely impacted by the absence of reimbursement from third party health care payers, which cannot be guaranteed.

     There can be no assurance that any product we develop will gain market acceptance among health care providers.  We do not believe that our Backroller will be eligible for third-party reimbursement, and as a result, market acceptance may be adversely affected.  

The success of the Backroller depends in large part upon the acceptance by medical practitioners and patients, which cannot be guaranteed.  

     Medical practitioners and patients may not accept and use the Backroller.  Acceptance and use will depend upon a number of factors, including perceptions by members of the health care community, including physicians, about the safety and effectiveness of the device; cost-effectiveness of the device relative to competing products; availability of reimbursement for the products from government or other healthcare payers; and effectiveness of marketing and distribution efforts by us and our licensees and distributors, if any.  Because we expect sales of the Backroller to generate substantially all of our product revenues for the foreseeable future, the failure of the Backroller to find market acceptance would harm our business and could require us to seek additional financing.

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Determination of Offering Price

     The offering price of the shares being offered hereby was arbitrarily determined by us and is not necessarily related to our assets, book value or financial condition.  In determining the offering price and the number of shares to be offered, we considered such factors as our financial condition, our net tangible book value, limited operating history and general condition of the securities market.  Accordingly, the offering price of the shares may not indicate the actual value of our securities.  

     There currently exists no public trading market for our common stock, and we cannot assure you that such a market will develop in the future.  In the absence of an active public trading market, an investor may not be able to liquidate his investment without considerable delay, if at all.  If a market does develop, the price for our securities may be highly volatile and may bear no relationship to our actual financial condition or results of operation.

     If our securities are not quoted on the OTC Electronic Bulletin Board, they may be quoted in the "pink sheets" maintained by the Pink Sheets, LLC, which reports quotations by brokers or dealers making a market in particular securities.  We have no agreement with any other broker or dealer to act as a market maker for our securities and there is no assurance that we will be successful in obtaining any market makers.  The lack of a market maker for our securities could adversely influence the market for and price of our securities, as well as your ability to dispose of, or to obtain accurate quotations as to the price of, our securities.