Edgar Filing: PACIFICHEALTH LABORATORIES INC

t60883_10qsb.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-QSB

(Mark One)

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

For the quarterly period ended September 30, 2007

-OR-

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

For the transition period from __________ to __________

Commission File No. 333-36379

PACIFICHEALTH LABORATORIES, INC.

(Exact name of Small Business Issuer as specified in its charter)

DELAWARE	22-3367588
(State or other jurisdiction of	(I.R.S. Employer
incorporation or organization)	Identification Number)

100 Matawan Road, Suite 420
Matawan, NJ	07747
(Address of principal executive offices)	(Zip Code)

Registrant's telephone number, including area code: (732) 739-2900

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

Yes [X] No [ ]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-25 of the Exchange Act) Yes [ ] No [X]

At November 14, 2007, there were 13,501,426 shares of common stock, par value $0.0025 per share, of the issuer outstanding.

Transitional small business disclosure format: Yes [ ] No [X]

PACIFICHEALTH LABORATORIES, INC.

TABLE OF CONTENTS

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS			3

PART I. FINANCIAL INFORMATION

	ITEM 1. FINANCIAL STATEMENTS

		Balance Sheets as of September 30, 2007 (Unaudited) and December 31, 2006	4

		Statements of Operations (Unaudited) for the three and nine months ended September 30, 2007 and 2006	5

		Statements of Cash Flows (Unaudited) for the nine months ended September 30, 2007 and 2006	6

		Notes to Financial Statements	7

	ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS		11

	ITEM 3. CONTROLS AND PROCEDURES		14

PART II. OTHER INFORMATION

	ITEM 1. LEGAL PROCEEDINGS		14

	ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS		14

	ITEM 3. DEFAULTS UPON SENIOR SECURITIES		15

	ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS		15

	ITEM 5. OTHER INFORMATION		15

	ITEM 6. EXHIBITS		15


SIGNATURES			17

Cautionary Note Regarding Forward-Looking Statements

As used herein, unless we otherwise specify, the terms the “Company,” "we," "us," and "our" means PacificHealth Laboratories, Inc.

This Report contains forward-looking statements concerning our financial condition, results of operations and business, including, without limitation, statements pertaining to:

	·	The development, testing, and commercialization of new products and the expansion of the market for our current products;
	·	The receipt of royalty payments from our agreements with business partners;
	·	Implementing aspects of our business plans;
	·	Financing goals and plans;
	·	Our existing cash and whether and how long these funds will be sufficient to fund our operations; and
	·	Our raising of additional capital through future equity financings.

These and other forward-looking statements are primarily in the section entitled "Management's Discussion and Analysis of Financial Conditions and Results of Operations". Generally, you can identify these statements because they include phrases such as "anticipates," "believes," "expects," "future," "intends," "plans," and similar terms. These statements are only predictions. Although we do not make forward-looking statements unless we believe we have a reasonable basis for doing so, we cannot guarantee their accuracy, and actual results may differ materially from those we anticipated due to a number of uncertainties, many of which are unforeseen. You should not place undue reliance on these forward-looking statements, which apply only as of the date of this Report on Form 10-QSB. Our actual results could differ materially from those anticipated in these forward-looking statements for many reasons, including those stated in this Report. We undertake no obligation to update publicly any forward-looking statements, whether as a result of new information, future events or otherwise. We cannot be sure when or if we will be permitted by regulatory agencies to undertake clinical trials or to commence any particular phase of clinical trials. Because of this, statements regarding the expected timing of clinical trials cannot be regarded as actual predictions of when we will obtain regulatory approval for any “phase” of clinical trials.

We believe it is important to communicate our expectations to our investors. There may be events in the future, however, that we are unable to predict accurately or over which we have no control. Cautionary language in this Report provides examples of risks, uncertainties and events that may cause our actual results to differ materially from the expectations we describe in our forward-looking statements.

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

PACIFICHEALTH LABORATORIES, INC.
BALANCE SHEETS

ASSETS
	September 30,			December 31,
	2007			2006
	(Unaudited)
Current assets:
Cash and cash equivalents	$	1,797,172		$	2,564,038
Accounts receivable, net		1,080,213			502,234
Inventories, net		2,086,651			1,913,275
Prepaid expenses		113,097			144,059
Total current assets		5,077,133			5,123,606

Property and equipment, net		144,087			74,163

Deposits		10,895			10,895

Total assets	$	5,232,115		$	5,208,664

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
Notes payable	$	43,885		$	44,327
Accounts payable and accrued expenses		616,942			960,757
Deferred revenue		480,508			244,197
Total current liabilities		1,141,335			1,249,281

Stockholders' equity:
Common stock, $.0025 par value; authorized
50,000,000 shares; issued and outstanding:
13,486,426 shares at September 30, 2007 and
12,776,690 shares at December 31, 2006		33,716			31,942
Additional paid-in capital		18,782,165			17,867,945
Accumulated deficit		(14,725,101	)		(13,940,504	)
		4,090,780			3,959,383

Total liabilities and stockholders' equity	$	5,232,115		$	5,208,664

See accompanying notes to financial statements.

PACIFICHEALTH LABORATORIES, INC.
STATEMENTS OF OPERATIONS
FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2007 AND 2006
(UNAUDITED)


	Three Months						Nine Months
	Ended September 30,						Ended September 30,
	2007			2006			2007			2006

Revenues:
Net product sales	$	2,134,736		$	1,774,130		$	6,023,519		$	5,096,732

Cost of Goods Sold:
Cost of product sales		1,196,772			976,738			3,634,018			2,687,824
Write off of obsolete inventory		439,208			-			439,208			-
Total cost of goods sold		1,635,980			976,738			4,073,226			2,687,824

Gross profit		498,756			797,392			1,950,293			2,408,908

Selling, general and administrative expenses		890,049			705,564			2,569,878			2,236,327
Research and development expenses		35,327			53,916			162,490			141,400
Depreciation expense		26,777			14,329			67,108			43,281
		952,153			773,809			2,799,476			2,421,008

Net operating (loss) income		(453,397	)		23,583			(849,183	)		(12,100	)

Other income (expense):
Gain on sale of patents/technology, net of expenses of $90,795		-			-			-			3,909,205
Interest income		16,603			31,516			52,534			64,249
Interest expense		(1,114	)		(915	)		(2,951	)		(31,051	)
Other income		5,003			-			15,003			-
		20,492			30,601			64,586			3,942,403

(Loss) income before income taxes		(432,905	)		54,184			(784,597	)		3,930,303

Provision for income taxes		-			-			-			1,278,000

Net (loss) income		(432,905	)		54,184			(784,597	)		2,652,303

Less: Preferred dividends		-			-			-			(10,425	)

Net (loss) income applicable to common stockholders	$	(432,905	)	$	54,184		$	(784,597	)	$	2,641,878

Basic (loss) income per share	$	(0.03	)	$	0.00		$	(0.06	)	$	0.23

Diluted (loss) income per share	$	(0.03	)	$	0.00		$	(0.06	)	$	0.20

Weighted average common shares - Basic		13,446,579			12,702,460			13,251,766			11,620,214

Weighted average common shares - Diluted		13,446,579			14,328,082			13,251,766			13,389,104

See accompanying notes to financial statements.

PACIFICHEALTH LABORATORIES, INC.
STATEMENTS OF CASH FLOWS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2007 AND 2006
(UNAUDITED)

	2007			2006
Cash flows from operating activities:
Net (loss) income	$	(784,597	)	$	2,652,303
Adjustments to reconcile net (loss) income to net
cash used in operating activities:
Depreciation		67,108			43,281
Allowance for doubtful accounts		9,000			9,000
Writedown of packaging inventory		49,135			-
Equity instrument based compensation/consulting expense		189,958			154,875
Gain on sale of patents and technology,
net of expenses of $90,795		-			(3,909,205	)
Provision for income taxes		-			1,278,000
Write-off of inventory		439,208			-
Changes in assets and liabilities:
(Increase) in accounts receivable		(586,979	)		(619,784	)
(Increase) decrease in inventories		(661,719	)		291,570
Decrease in prepaid expenses		30,962			17,403
(Increase) in deposits		-			(20,591	)
(Decrease) in accounts payable/accrued expenses		(343,815	)		(1,147,323	)
Increase (decrease) in deferred revenue		236,311			(8,927	)
Net cash used in operating activities		(1,355,428	)		(1,259,398	)

Cash flows from investing activities:
Purchase of property and equipment		(137,032	)		(55,003	)
Proceeds from sale of patents and technology,
net of expenses of $90,795		-			3,909,205
Net cash (used in) provided by investing activities		(137,032	)		3,854,202

Cash flows from financing activities:
Issuance of notes payable		79,305			766,100
Repayments of notes payable		(79,747	)		(863,119	)
Repayments of convertible notes payable		-			(500,000	)
Common stock issued		450,000			-
Proceeds from common stock options/warrants exercised		276,036			900,930
Net cash provided by financing activities		725,594			303,911

Net (decrease) increase in cash and cash equivalents		(766,866	)		2,898,715

Cash and cash equivalents, beginning balance		2,564,038			138,487

Cash and cash equivalents, ending balance	$	1,797,172		$	3,037,202


Supplemental disclosures of cash flow information:
Cash paid for interest	$	2,951		$	31,051

Schedule of non-cash financing activity:
Conversion of 90,909 shares of Series A Preferred Stock
into 909,091 shares of common stock	$	-		$	966,387

See accompanying notes to financial statements.

PACIFICHEALTH LABORATORIES, INC.

NOTES TO FINANCIAL STATEMENTS

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2007 AND 2006

(UNAUDITED)

1. Basis of Presentation

The accompanying unaudited financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and with the instructions for Form 10-QSB and Item 310 of Regulation S-B. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three and nine months ended September 30, 2007 are not necessarily indicative of the results that may be expected for the year ending December 31, 2007. The unaudited financial statements should be read in conjunction with the financial statements and footnotes thereto included in the Company's annual report on Form 10-KSB for the year ended December 31, 2006.

On February 22, 2006, pursuant to an Asset Purchase Agreement of the same date, the Company sold to Mott’s LLP, a division of Cadbury Schweppes Americas Beverages (“CSAB”) the patents, trademarks, web sites, and other intellectual property related to its ACCELERADE and ENDUROX sports nutrition product lines for $4,000,000 in cash and potential future royalty payments. Simultaneously, the Company entered into a License Agreement with CSAB giving it the exclusive, royalty free right to continue to sell its sports nutrition products in powder, gel and pill form. Consequently, the Company will continue to sell its current sports nutrition products in the same manner as prior to the sale of the intellectual property assets.

The Company will receive royalty payments for a finite period following the launch of a product using the purchased assets, subject to an annual limitation on the amount of the royalty. There are no minimum royalties. CSAB launched a ready-to-drink (“RTD”) product in late June 2007.

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make certain 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 amount of revenue and expenses during the reporting period. Actual results may differ from these estimates. The significant estimates and assumptions made by the Company are in the area of revenue recognition as it relates to customer returns, inventory obsolescence, allowance for doubtful accounts, and valuation allowances for deferred tax assets, and valuation of equity instruments issued under Statement of Financial Accounting Standards ("SFAS") No. 123R, "Share-Based Payment" ("SFAS 123R").

2. Revenue Recognition

Sales are recognized when all of the following criteria are met: (1) persuasive evidence that an arrangement exists; (2) delivery has occurred or services have been rendered; (3) the seller’s price to the buyer is fixed and determinable; and, (4) collectibility is reasonably assured. Sales are recorded net of incentives paid to customers.

The Company has a sales agreement with a significant customer for all products sold to this customer whereby all unsold product is subject to return provisions. The Company recognizes revenue when this major customer sells through its products to its consumers. At September 30, 2007, the Company has deferred $480,508 in revenues related to this customer. At December 31, 2006, the Company had deferred $244,197 in revenues related to this customer.

3. Inventories

As of September 30, 2007 and December 31, 2006, inventories consisted of the following:

	Sept. 30, 2007
	(Unaudited)		December 31, 2006
Raw materials	$	440,326	$	531,995
Work in process		-		77,771
Packaging supplies		64,970		41,378
Finished goods		1,358,985		1,165,188
Finished goods on consignment		222,370		96,943
	$	2,086,651	$	1,913,275

Included above are reserves against finished goods of $817,815 and $545,648, respectively, at September 30, 2007 and December 31, 2006

4. Stock Based Compensation

Effective January 1, 2006, the Company adopted SFAS 123R which establishes standards for transactions in which an entity exchanges its equity instruments for goods or services. SFAS 123R focuses primarily on accounting for transactions in which an entity obtains employee services in share-based payment transactions, including issuances of stock options to employees. Utilizing the Modified Prospective method, the Company recorded charges of $65,091 and $188,448, respectively, in the three- and nine- months ended September 30, 2007, representing the effect on loss from continuing operations, loss before income taxes, and net loss. The impact of the adoption of 123R was to reduce basic earnings per share by $0.00 and $0.01, respectively, in the three- and nine- months ended September 30, 2007. The Company recorded charges of $42,376 and $141,256, respectively in the three- and nine- months ended September 30, 2006, representing the effect on income from continuing operations, income before income taxes, and net income. The impact of the adoption of 123R was to reduce basic earnings per share by $0.00 and $0.01, respectively, in the three- and nine- months ended September 30, 2006.

The Company granted 35,000 stock options to employees and directors during the three months ended September 30, 2007 with exercise prices ranging from $1.90 to $1.93 per share. 20,000 of these options vest in the first quarter of 2008 and 15,000 of these options vest ratably through the third quarter of 2010. These options were determined to have a total fair value of $55,465. The Company granted 61,000 stock options to employees and directors during the nine months ended September 30, 2007 with exercise prices ranging from $1.90 to $2.14 per share. These options were determined to have a total fair value of $101,519. Compensation expense recognized during the three months ended September 30, 2007 amounted to $65,091. Compensation expense recognized during the nine months ended September 30, 2007 amounted to $188,448. These amounts were charged to operations and added to paid-in capital in accordance with SFAS 123R. The Company granted no options to employees and directors during the three months ended September 30, 2006. The Company granted 508,000 options to employees and directors during the nine months ended September 30, 2006 with exercise prices ranging from $0.20 per share to $0.60 per share. 241,333 of these options vest during the first quarter of 2007; 133,333 of these options vest during the first quarter of 2008; and 133,334 of these options vest during the first quarter of 2009. These options were determined to have a total fair value of $230,540. These options were determined to have a fair value of $25,302 for the three months ended September 30, 2006 and $75,904 for the nine months ended September 30, 2006. In addition, $17,074 and $65,352 for the three- and nine-month periods ending September 30, 2006 respectively consist of options expense from options issued prior to January 1, 2006. These amounts were charged to operations and added to paid-in capital in accordance with SFAS 123R. The total intrinsic value of options exercised during the three and nine months ended September 30, 2007 was $83,670 and $109,280, respectively. The total intrinsic value of options exercised during the three and nine months ended September 30, 2006 was $6,748 and $59,248, respectively.

The Company granted no stock options to consultants during the three months ended September 30, 2007. The Company granted 1,000 stock options to a consultant during the nine months ended September 30, 2007 that vested upon grant with an exercise price of $2.10 per share. These options were determined to have a fair value of $1,510 that was charged to operations and added to paid-in capital in the nine month period ended September 30, 2007. In addition, 22,500 options previously issued to consultants expired during the first nine months of 2007. The Company granted 2,500 stock options to consultants during the three months ended September 30, 2006 that vested upon grant with an exercise price of $1.23 per share. These options were determined to have a fair value of $2,860 that was charged to operations and added to paid-in capital in the three-month period ended September 30, 2006. The Company granted 91,500 stock options to consultants during the nine months ended September 30, 2006 that vested upon grant with exercise prices ranging from $0.20 to $1.23 per share. These options were determined to have a fair value of $13,619 that was charged to operations and added to paid-in capital in the nine-month period ended September 30, 2006.

In summary, compensation charges to operations for the periods presented are as follows:

	Three Months				Nine Months
	Ended 9/30				Ended 9/30
	2007		2006		2007		2006

Employee compensation	$	65,091	$	42,736	$	188,448	$	141,256
Consultant compensation		-		2,860		1,510		13,619
	$	65,091	$	45,596	$	189,958	$	154,875

A summary of employee options activity under our plans as of September 30, 2007 and changes during the nine-month period then ended is presented below:

						Weighted-
				Weighted-		Average
				Average		Remaining	Aggregate
				Exercise		Contractual	Intrinsic
Options	Shares			Price		Term (Years)	Value
Balance, January 1, 2007		2,011,500		$	1.12
Granted during the period		61,000		$	2.00
Exercised during the period		(66,000	)	$	0.69
Expired during the period		(33,000	)	$	3.80
Outstanding, September 30, 2007		1,973,500		$	1.12	2.52	$	1,731,825
Exercisable, September 30, 2007		1,210,834		$	1.20	1.67	$	1,072,393

The market value of the Company’s common stock as of September 30, 2007 was $1.85 per share.

				Weighted-
				Average
				Grant-Date
Non-vested Shares	Shares			Fair Value
Non-vested, January 1, 2007		942,000		$	0.81
Granted during the period		61,000		$	2.00
Vested during the period		(240,334	)	$	0.52
Forfeited during the period		-		$	-
Non-vested, September 30, 2007		762,666		$	1.00

As of September 30, 2007, the total fair value of non-vested awards amounted to $428,222. The weighted average remaining period over which such options are expected to be recognized is 2.30 years.

The fair value of each option award during the three months ended September 30, 2007 is estimated on the date of grant using the Black-Scholes option valuation model that uses the assumptions noted in the following table:

	Sept. 30, 2007
Expected volatility	117%
Weighted-average volatility	117%
Expected dividends	0.0%
Expected term (in years)	5
Risk-free rate	4.20%

5. Income Taxes

The Company has approximately $15,630,000 in federal and $2,728,000 in state net operating loss carryovers generated through December 31, 2006 that can be used to offset future taxable income in calendar years 2007 through 2026. The net operating loss carryovers will expire in the year 2015 through the year 2026. As of September 30, 2007, the Company has fully reserved for these net operating loss carryovers.

In July 2006, the FASB issued FASB Interpretation No. 48, “Accounting for Uncertainty in Income Taxes” - an interpretation of FASB Statement No. 109 (“FIN 48”), which clarifies the accounting and disclosure for uncertain tax positions, as defined. FIN 48 seeks to reduce the diversity in practice associated with certain aspects of the recognition and measurement related to accounting for income taxes. The Company adopted the provision of FIN 48 effective January 1, 2007. The adoption of FIN 48 had no material effect on the Company’s results of operations or financial position.

6. Concentration

The Company’s largest customer accounted for approximately 29% of net sales for the three months ended September 30, 2007 and the Company’s two largest customers accounted for approximately 20% and 19%, respectively, of net sales for the three months ended September 30, 2006. The Company’s two largest customers accounted for approximately 20% and 14%, respectively, of net sales for the nine months ended September 30, 2007 and the Company’s two largest customers accounted for approximately 20% and 19%, respectively, of net sales for the nine months ended September 30, 2006. At September 30, 2007, amounts due from these two customers represented approximately 44% and 4%, respectively, of accounts receivable. At December 31, 2006, amounts due from these two customers represented approximately 27% and 14%, respectively, of accounts receivable. No other customers exceeded 10% of respective captions noted above.

Two suppliers accounted for approximately 63% and 37%, respectively, of total inventory purchases for the three months ended September 30, 2007 and one supplier accounted for approximately 80% of total inventory purchases for the three months ended September 30, 2006. Two suppliers accounted for approximately 66% and 24%, respectively, of total inventory purchases for the nine months ended September 30, 2007 and two suppliers accounted for approximately 66% and 21%, respectively, of total inventory purchases for the nine months ended September 30, 2006. At September 30, 2007, amounts due to these two vendors represented approximately 34% and 20%, respectively, of accounts payable and accrued expenses. At December 31, 2006, amounts due to these two vendors represented approximately 3% and 2%, respectively, of accounts payable and accrued expenses. No other vendors exceeded 10% of respective captions noted above.

7. Equity Instruments

Stock Issued

During the three months ended September 30, 2007, the Company did not sell any shares of its common stock. During the nine months ended September 30, 2007, the Company sold 243,243 shares of its common stock as a result of a private sale of stock to a new director of the Company and an investment fund managed by another new director of the Company resulting in proceeds of $450,000.

Options and Warrants

During the three months ended September 30, 2007, 47,000 options and 87,080 warrants were exercised, resulting in proceeds of $69,257. Of these shares, 27,604 were issued pursuant to warrants with a cashless exercise feature. During the nine months ended September 30, 2007, 66,000 options and 400,493 warrants were exercised, resulting in proceeds of $276,036. Of these shares, 35,724 were issued pursuant to warrants with a cashless exercise feature.

8. Subsequent Event

Between October 1, 2007 and November 14, 2007, the Company has issued an additional 15,000 shares of its common stock as a result of the exercise of options, resulting in proceeds of $7,550

Item 2.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

In this Report on Form 10-QSB, the terms the “Company,” “we”, “us,” and “our” refer to PacificHealth Laboratories, Inc.

(a) Introduction

PacificHealth Laboratories is a nutrition technology company that was incorporated in the State of Delaware in April 1995. Our mission is to discover, develop, and commercialize nutritional products to improve health, manage chronic disease, and enhance existing therapies that are patentable and are substantiated by well-controlled clinical trials conducted at leading university research centers. Our principal areas of focus include sports performance, weight loss, and management of Type II diabetes. Our products can be marketed without prior Food and Drug Administration (“FDA”) approval under current regulatory guidelines. We employ multiple strategies for the commercialization of our technologies: 1) launch a brand via highly targeted consumer channels, 2) license the technology to a major food or drug company, or 3) a combination of both 1 and 2.

We are focused on developing patented protein-based nutrition products using two core technology platforms. One platform involves the activation of biochemical pathways by specific nutritional compositions to enhance muscle growth, energy, and transport pathways. Using this nutritional technology platform, our research efforts have been directed to product development for 1) improving exercise performance, 2) post-surgical muscle recovery, and 3) oral rehydration. The second technology platform involves stimulation of specific satiety peptides that are released in the stomach. Using this nutritional technology platform, our research efforts have been directed in product development for 1) appetite suppression and weight loss, and 2) management of Type II diabetes.

ACTIVATION OF MUSCLE GROWTH, ENERGY AND TRANSPORT PATHWAYS

Exercise Performance

Our research into factors influencing exercise performance and muscle growth and recovery has led to the development and commercialization of a new generation of sports and recovery drinks. The key to our technology is the specific ratio in which protein is combined with carbohydrates. We have two patents on this technology and over 18 studies have been published demonstrating that products based on this technology can extend endurance, reduce muscle damage, improve rehydration, and accelerate muscle recovery. Our research in exercise performance has led to the introduction and commercialization of a number of products for the aerobic and strength training athlete. These include:

· ENDUROX EXCEL^® - Introduced in March 1997.

· ENDUROX R4^® Recovery Drink – Introduced in February 1999

· ACCELERADE^® Sports Drink – Introduced in June 2001

· ACCEL GEL^® – Introduced in February 2004

On February 22, 2006, pursuant to an Asset Purchase Agreement of the same date, we sold to Mott’s LLP, a division of Cadbury Schweppes Americas Beverages (“CSAB”), the patents, trademarks, web sites, and other intellectual property related to our ACCELERADE and ENDUROXsports nutrition product lines for $4,000,000 in cash and potential future royalty payments. Simultaneously, we entered into a License Agreement with CSAB giving us the exclusive, royalty free right to continue to sell our sports nutrition products in powder, gel and pill form. Consequently, we will continue to sell our current sports nutrition products in the same manner as prior to the sale of the intellectual property assets.

We will receive royalty payments for a finite period following the launch of a product using the purchased assets, subject to an annual limitation on the amount of the royalty and commencing upon the shipment of a minimum number of cases of the product. There are no minimum royalties. CSAB launched a RTD product in late June of 2007.

Post-Surgical Muscle Recovery

Scientific insights emanating from our discoveries in sports nutrition have led to a potentially new and exciting medical application. Individuals undergoing orthopedic surgery, particularly involving the shoulder, hip or knee, experience muscle atrophy that occurs as a normal consequence of muscle immobilization in the post-surgery period. The degree of muscle atrophy a patient experiences significantly impacts health care costs and quality of life. We are currently evaluating a novel nutritional formulation that has the potential of slowing muscle atrophy following a period of forced immobilization. Such a product could have enormous benefit for the 1.6 million patients who undergo arthroscopy and muscle and knee replacement operations each year, and the 5 million patients who suffer a sports related injury. A clinical study to examine the effectiveness of this formulation is underway. We have filed one patent on this technology and plan to file additional patents in the future.

Oral Rehydration

Another scientific byproduct of our research on the effects of protein has been the identification of nutritional formulas that can enhance sodium transport. Such products would have widespread medical application in treating dehydration commonly associated with vomiting and diarrhea. We will continue our studies and may file patents for this indication in 2007.

ACTIVATION OF SATIETY PEPTIDES

Weight Loss

Satiety peptides have been shown to reduce food intake and suppress appetite in humans. Our research has specifically focused on developing nutritional formulations that can stimulate cholecystokin (CCK), one of the body’s primary satiety peptides. CCK is normally released after a meal, particularly one high in fat and protein. CCK is often called the “feel full” protein because when it is released it gives a feeling of fullness and signals the brain to terminate the meal. The objective of our research is to develop a nutritional composition that stimulates and extends the duration of action of CCK in a calorically efficient way, i.e. to cause a release of CCK with 45-50 calories of specific nutrients rather than 1,000 calories.

The first product we commercialized using this technology was SATIETROL^® that was released in April 2000. This was followed by the introduction of a meal replacement product called SATIETROL COMPLETE^® in January 2001. Clinical studies showed that both of these products could reduce hunger and reduce caloric intake. In June 2001, we signed an exclusive worldwide licensing agreement with GlaxoSmithKline (“GSK”) for our weight loss technology. Under the agreement, we received an initial payment of $1,000,000 and received a subsequent milestone payment of $250,000. GSK subsequently terminated the agreement in September 2002 with all rights reverting back to us.

We have continued research in this area in order to develop a more effective composition that could be incorporated into different forms (ready-to-drink beverage and chewable tablet) and also has the potential to be added to food and increase the satiation property of the food to which it was added. Starting in the third quarter of 2003, the Company funded a number of clinical studies on an improved formulation. The new formulation was shown to be significantly better than the previous product in reducing caloric intake, slowing gastric emptying, and extending a feeling of satiation following a meal. We have seven patents on our appetite suppressant technology with additional patents pending. We test launched a ready-to-drink beverage using this improved technology under the trade name SATIATRIM^® in January 2007 and officially launched the product in June 2007. Refer to Results of Operations (below) for current activity.

Type II Diabetes

Our appetite suppression technology may also have potential for the treatment of Type II diabetes, the fastest growing chronic condition in the U.S., affecting an estimated 46 million people. We have instituted clinical trials to measure the effectiveness of our formulation in controlling blood glucose.

(b) Results of Operations – Three and Nine Months Ended September 30, 2007 and 2006

We recorded a net loss applicable to common stockholders of ($432,905), or ($0.03) per share (basic and diluted), for the third quarter ended September 30, 2007 compared to net income applicable to common stockholders of $54,184, or $0.00 per share (basic and diluted), for the third quarter ended September 30, 2006. We recorded a net loss applicable to common stockholders of ($784,597), or ($0.06) per share (basic and diluted), for the nine-month period ended September 30, 2007, compared to net income applicable to common stockholders of $2,641,878, or $0.20 per share fully diluted, for the nine-month period ended September 30, 2006. The nine-month period ended September 30, 2006 would have resulted in net income (non-GAAP measure) of $10,673, or $0.00 per share (basic and diluted), if $2,631,205 (net of income taxes of $1,278,000) from the sale of patents and technology to CSAB were excluded from net income. See Part I, Item 2(a) above for a description of the CSAB transaction. The loss for the three- and nine- month periods ended September 30, 2007 was primarily the result of three circumstances: (i) increased marketing and other expenses of $88,449 and $276,167, respectively, for the three- and nine- month periods ended September 30, 2007 for the launch of SATIATRIM, (ii) lower gross margins as detailed below, and (iii) the write-off of $439,208 of SATIATRIM inventory as noted below. Without the inventory write-off, we would have recorded a net income of $6,303 (non-GAAP measure) for the three months ended September 30, 2007 and a net loss of $345,389 (non-GAAP measure) for the nine months ended September 30, 2007.

Revenues increased 20% in the quarter ended September 30, 2007 to $2,134,736 from $1,774,130 for the same period in 2006. Revenues in the nine-month period ended September 30, 2007 increased 18% to $6,023,519 from $5,096,732 for the same period in 2006. Revenues increased in the three- and nine- month periods ended September 30, 2007 as compared to the same periods in 2006 as a result of the implementation of a new retailer program which involves free-standing racks, the CSAB ACCELERADE Ready-to-Drink advertising and promotional launch, increased serving sizes per canister that results in additional sales dollars per canister, and the expansion of the number of ACCELERADE and ACCEL GEL products carried by some of our larger accounts. CSAB launched ACCELERADE Ready-to-Drink on June 21, 2007.

For the three months ended September 30, 2007, gross profit margin on product sales was 43.9% compared to 44.9% for the three months ended September 30, 2006. For the nine months ended September 30, 2007, gross profit margin on product sales was 39.7% compared to 47.3% for the nine months ended September 30, 2006. We experienced a change in our product mix. Also, in order to fully take advantage of the CSAB advertising spend, we redesigned all ACCELERADE and ACCEL GEL packaging to conform to the new CSAB ACCELERADE RTD packaging. To flush out old inventory, we aggressively discounted these products, leading to lower gross profit margins. We wrote off approximately $49,000 of non CSAB-type packaging material, which is the equivalent of 0.8% of the nine-month revenues. We experienced cost of production and raw material price increases, specifically whey protein, in our finished products from 2006 to 2007. We also experienced a significant increase in freight costs coupled with our decision to provide free freight to more customers as a sales incentive. To address these issues, we implemented our first ever price increase effective July 1, 2007. This price increase met no resistance in the market place.

During the quarter ended September 30, 2007, we reserved $439,208 of SATIATRIM inventory that has expiration dates between December 2007 and January 2008. This was done in accordance with generally accepted accounting principles. We intend to use this inventory as sample product during its remaining useful life which management believes will assist in its promotional efforts. Our marketing efforts to date did not result in sufficient sales to be able to project that we would be able to sell through this inventory before it expires. We will continue to market and sell this product through a public relations effort directed at leading women’s magazines supplemented by numerous direct response campaigns including e-mail. We will also continue our efforts to expand beyond the U.S. market.

Selling, general, and administrative (“S, G, & A”) expenses increased to $890,049 for the three-month period ended September 30, 2007 from $705,564 for the three-month period ended September 30, 2006. S, G, & A expenses increased to $2,569,878 for the nine-month period ended September 30, 2007 from $2,236,327 for the nine-month period ended September 30, 2006. S, G, & A expenses increased primarily due to the investment in marketing and other expenses of $88,449 and $276,167 respectively, for the three- and nine- month periods ended September 30, 2007 associated with the launch of SATIATRIM. We expect to continue to invest in the marketing of SATIATRIM. Late in the second quarter, we officially launched the product via a major public relations campaign that involves the Internet, radio, television, and print media.

Research and development (“R & D”) expenses were $35,327 for the three months ended September 30, 2007 compared to $53,916 for the three months ended September 30, 2006. R & D expenses were $162,490 for the nine months ended September 30, 2007 versus $141,400 for the nine months ended September 30, 2006. We anticipate R & D expenses will increase as we conduct additional clinical trials and seek out additional patents and claims for all of our products.

Interest expense was $1,114 for the three months ended September 30, 2007 compared to $915 for the three months ended September 30, 2006. Interest expense was $2,951 for the nine months ended September 30, 2007 compared to $31,051 for the nine months ended September 30, 2006. There was $24,634 of interest expense in 2006 incurred in connection with our accounts receivable funding from USA Funding that was paid off upon the completion of the CSAB transaction in the first quarter of 2006.

Income tax expense was $-0- for the three months ended September 30, 2007 and September 30, 2006. Income tax expense was $-0- for the nine months ended September 30, 2007 compared to $1,278,000 for the nine months ended September 30, 2006. The income tax expense in the nine months ended September 30, 2006 was due to the aforementioned CSAB transaction. The effective tax rate in 2006 differs from the statutory tax rate primarily due to the utilization of net operating losses to reduce taxable income.

(c) Liquidity and Capital Resources

At September 30, 2007, our current assets exceeded our current liabilities by approximately $3,936,000 with a ratio of current assets to current liabilities of approximately 4.4 to 1. At September 30, 2007, cash on hand was $1,797,172, a decrease of $766,866 from December 31, 2006, primarily as the result of an increase of $577,979 in accounts receivable, an increase in inventory of $173,376, a decrease in prepaid expenses of $30,962, an decrease in accounts payable and accrued expenses of $343,815, an decrease in notes payable of $442 and an increase in deferred revenue of $236,311 from December 31, 2006. Accounts receivable increased at September 30, 2007 from December 31, 2006 due to normally higher revenues in the third quarter as compared to the fourth quarter of the previous year. Inventory also increased due to higher sales volumes. Deferred revenue increased as a major customer took on additional products and increased its inventories in the third quarter of 2007 as compared to the fourth quarter of 2006. In addition, we issued common stock in connection with sales of common stock and exercises of options and warrants resulting in proceeds of $726,036 during the nine months ended September 30, 2007.

We have no material commitments for capital expenditures.

(d) Off-Balance Sheet Arrangements

There are no off-balance sheet arrangements between the Company and any other entity that have, or are reasonably likely to have, a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures, or capital resources that is material to investors.

ITEM 3. CONTROLS AND PROCEDURES

Evaluation of disclosure controls and procedures. Based on their evaluation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) promulgated under the Exchange Act) as of September 30, 2007, the end of the period covered by this Report, our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures are designed to ensure that information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms; that such information is accumulated and disclosed to management, including the Chief Executive Officer and the Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure; and that such disclosure controls and procedures are effective.

Changes in internal control over financial reporting. During the quarter ended September 30, 2007, there were no changes in our internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

None.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

In the three-month period ended September 30, 2007, we issued an additional 87,080 shares of our common stock as a result of the exercise of warrants which had been issued in private placements occurring in 2003, resulting in proceeds of $37,619. Of these shares, 27,604 were issued pursuant to a cashless exercise feature. The offer and sale of these shares of Common Stock upon exercise of the warrants was exempt from registration under the Securities Act of 1933 in reliance upon Section 4(2) thereof and Rule 506 of Regulation D promulgated thereunder. No sale of the Common Stock involved the use of underwriters, and no commissions were paid in connection with the issuance or sale of the Common Stock. The shares of Common Stock have been registered under the Securities Act of 1933 for resale by the holders thereof.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

None.

ITEM 5. OTHER INFORMATION

None.

ITEM 6. EXHIBITS

Exhibit Number	Description of Exhibit⁽¹⁾

3(i)(a)	Certificate of Incorporation of PacificHealth Laboratories, Inc. and all amendments thereto (incorporated by reference to Exhibit 3.1 to PacificHealth Laboratories, Inc.’s Registration Statement on Form SB-2 (Registration No. 333-36379) filed on September 25, 1997)

3(i)(b)	Certificate of Amendment of Certificate of Incorporation of PacificHealth Laboratories, Inc. (incorporated by reference to Exhibit 3.3 to PacificHealth Laboratories, Inc.’s Annual Report on Form 10-KSB filed on March 31, 2003)

3(i)(c)	Certificate of Designations for Series A Preferred Stock (incorporated by reference to Exhibit 3.1 to PacificHealth Laboratories, Inc.’s Current Report on Form 8-K filed on January 28, 2005)

3(i)(d)	Certificate of Designations for Series B Preferred Stock, filed with the Secretary of State of the State of Delaware on April 28, 2005 (incorporated by reference to Exhibit 3(i) to PacificHealth Laboratories, Inc.’s Current Report on Form 8-K filed May 4, 2005)

3(ii)	Amended and Restated Bylaws of PacificHealth Laboratories, Inc. (incorporated by reference to Exhibit 3.2.1 to PacificHealth Laboratories, Inc.’s Amendment No. 3 to Registration Statement on Form SB-2/A filed on December 17, 1997)

4.1	Specimen Common Stock Certificate (incorporated by reference to Exhibit 4.1 to PacificHealth Laboratories, Inc.’s Amendment No. 3 to Registration Statement on Form SB-2/A filed on December 17, 1997)

4.2.1	Form of Securities Purchase Agreement entered into among PacificHealth Laboratories, Inc. and Certain of the Selling Stockholders dated August 26, 2003 (incorporated by reference to Exhibit 4.4 to PacificHealth Laboratories, Inc.’s Registration Statement on Form SB-2 filed on September 29, 2003)

4.2.2	Form of Registration Rights Agreement entered into among PacificHealth Laboratories, Inc. and Certain of the Selling Stockholders dated August 26, 2003 (incorporated by reference to Exhibit 4.5 to PacificHealth Laboratories, Inc.’s Registration Statement on Form SB-2 filed on September 29, 2003)

Exhibit Number	Description of Exhibit⁽¹⁾

4.2.3	Form of Warrant issued to Certain of the Selling Stockholders in connection with Exhibit 4.2.1 on August 26, 2003 (incorporated by reference to Exhibit 4.6 to PacificHealth Laboratories, Inc.’s Registration Statement on Form SB-2 filed on September 29, 2003)

4.3	Stock Purchase Agreement dated June 1, 2001, by and between PacificHealth Laboratories, Inc. and Glaxo Wellcome International B.V. (incorporated by reference to Exhibit 4.1 to PacificHealth Laboratories, Inc.’s Current Report on Form 8-K filed on June 14, 2001)

4.4.1	Series A Preferred Stock Purchase Agreement dated January 28, 2005, by and between PacificHealth Laboratories, Inc. and Hormel HealthLabs, LLC (incorporated by reference to Exhibit 4.3 to PacificHealth Laboratories, Inc.’s Annual Report on Form 10-KSB filed on April 15, 2005)

4.4.2	Investors’ Rights Agreement dated January 28, 2005, by and between PacificHealth Laboratories, Inc. and Hormel HealthLabs, LLC (incorporated by reference to Exhibit 4.4 to PacificHealth Laboratories, Inc.’s Annual Report on Form 10-KSB filed on April 15, 2005)

4.4.3	Right of First Refusal and Co-Sale Agreement dated January 28, 2005, by and between PacificHealth Laboratories, Inc., Robert Portman and Hormel HealthLabs, LLC (incorporated by reference to Exhibit 4.5 to PacificHealth Laboratories, Inc.’s Annual Report on Form 10-KSB filed on April 15, 2005)

4.4.4	Certificate of Designations for Series A Preferred Stock (incorporated by reference to Exhibit 3.1 to PacificHealth Laboratories, Inc.’s Current Report on Form 8-K filed on January 28, 2005)

4.5	Certificate of Designations for Series B Preferred Stock, filed with the Secretary of State of the State of Delaware on April 28, 2005 (incorporated by reference to Exhibit 3(i) to PacificHealth Laboratories, Inc.’s Current Report on Form 8-K filed on May 4, 2005)

4.6.1	Securities Purchase Agreement, dated August 24, 2005 by and between PacificHealth Laboratories, Inc. and Hormel HealthLabs, LLC (incorporated by reference to Exhibit 10.1 to PacificHealth Laboratories, Inc.’s Current Report on Form 8-K filed on August 30, 2005)

4.6.2	Amended and Restated Investors’ Rights Agreement dated August 24, 2005 between PacificHealth Laboratories, Inc. and Hormel HealthLabs, LLC and any additional investor that becomes a party thereto (incorporated by reference to Exhibit 4.1 to PacificHealth Laboratories, Inc.’s Current Report on Form 8-K filed on August 30, 2005)

4.6.3	Form of Secured Convertible Promissory Note issued in connection with Exhibit 4.6.1 (incorporated by reference to Exhibit 10.2 to PacificHealth Laboratories, Inc.’s Current Report on Form 8-K filed on August 30, 2005)

4.6.4	Security Agreement dated August 24, 2005 by and between PacificHealth Laboratories, Inc. and Hormel HealthLabs, LLC (incorporated by reference to Exhibit 10.3 to PacificHealth Laboratories, Inc.’s Current Report on Form 8-K filed on August 30, 2005)

10.1	Employment Extension Agreement between PacificHealth Laboratories, Inc. and Robert Portman effective January 1, 2004, executed February 28, 2006 (incorporated by reference to Exhibit 10.6 to PacificHealth Laboratories, Inc.’s Post-Effective Amendment to Registration Statement on Form SB-2/A (File No. 333-109197) filed on May 2, 2006)

Exhibit Number	Description of Exhibit⁽¹⁾

10.2.1	Asset Purchase Agreement dated February 22, 2006, by and between PacificHealth Laboratories, Inc. and Mott’s LLP (redacted, subject to request for confidential treatment) (incorporated by reference to Exhibit 10.8 to PacificHealth Laboratories, Inc.’s Annual report on Form 10-KSB filed on March 31, 2006)

10.2.2	License Agreement dated February 22, 2006, by and between PacificHealth Laboratories, Inc. and Mott’s LLP (redacted, subject to request for confidential treatment) (incorporated by reference to Exhibit 10.9 to PacificHealth Laboratories, Inc.’s Annual report on Form 10-KSB filed on March 31, 2006)

10.2.3	Consulting, License and Noncompetition Agreement dated February 22, 2006, by and between PacificHealth Laboratories, Inc., Mott’s LLP and Robert Portman (redacted, subject to request for confidential treatment) (incorporated by reference to Exhibit 10.10 to PacificHealth Laboratories, Inc.’s Annual report on Form 10-KSB filed on March 31, 2006)

31.1	Rule 13a-14(a) Certification of Chief Executive Officer (filed herewith)

31.2	Rule 13a-14(a) Certification of Chief Financial Officer (filed herewith)

32	Certifications of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (filed herewith)

(1)	In the case of incorporation by reference to documents filed by the Registrant under the Exchange Act, the Registrant’s file number under the Exchange Act is 000-23495.

SIGNATURES

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

	PACIFICHEALTH LABORATORIES, INC.


	By: /S/ STEPHEN P. KUCHEN
	STEPHEN P. KUCHEN
	Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer)

	Date: November 14, 2007

EXHIBIT INDEX

Exhibit Number	Description of Exhibit⁽¹⁾

3(i)(a)	Certificate of Incorporation of PacificHealth Laboratories, Inc. and all amendments thereto (incorporated by reference to Exhibit 3.1 to PacificHealth Laboratories, Inc.’s Registration Statement on Form SB-2 (Registration No. 333-36379) filed on September 25, 1997)

3(i)(b)	Certificate of Amendment of Certificate of Incorporation of PacificHealth Laboratories, Inc. (incorporated by reference to Exhibit 3.3 to PacificHealth Laboratories, Inc.’s Annual Report on Form 10-KSB filed on March 31, 2003)

3(i)(c)	Certificate of Designations for Series A Preferred Stock (incorporated by reference to Exhibit 3.1 to PacificHealth Laboratories, Inc.’s Current Report on Form 8-K filed on January 28, 2005)

3(i)(d)	Certificate of Designations for Series B Preferred Stock, filed with the Secretary of State of the State of Delaware on April 28, 2005 (incorporated by reference to Exhibit 3(i) to PacificHealth Laboratories, Inc.’s Current Report on Form 8-K filed May 4, 2005)

3(ii)	Amended and Restated Bylaws of PacificHealth Laboratories, Inc. (incorporated by reference to Exhibit 3.2.1 to PacificHealth Laboratories, Inc.’s Amendment No. 3 to Registration Statement on Form SB-2/A filed on December 17, 1997)

4.1	Specimen Common Stock Certificate (incorporated by reference to Exhibit 4.1 to PacificHealth Laboratories, Inc.’s Amendment No. 3 to Registration Statement on Form SB-2/A filed on December 17, 1997)

4.2.1	Form of Securities Purchase Agreement entered into among PacificHealth Laboratories, Inc. and Certain of the Selling Stockholders dated August 26, 2003 (incorporated by reference to Exhibit 4.4 to PacificHealth Laboratories, Inc.’s Registration Statement on Form SB-2 filed on September 29, 2003)

4.2.2	Form of Registration Rights Agreement entered into among PacificHealth Laboratories, Inc. and Certain of the Selling Stockholders dated August 26, 2003 (incorporated by reference to Exhibit 4.5 to PacificHealth Laboratories, Inc.’s Registration Statement on Form SB-2 filed on September 29, 2003)


4.2.3	Form of Warrant issued to Certain of the Selling Stockholders in connection with Exhibit 4.2.1 on August 26, 2003 (incorporated by reference to Exhibit 4.6 to PacificHealth Laboratories, Inc.’s Registration Statement on Form SB-2 filed on September 29, 2003)

4.3	Stock Purchase Agreement dated June 1, 2001, by and between PacificHealth Laboratories, Inc. and Glaxo Wellcome International B.V. (incorporated by reference to Exhibit 4.1 to PacificHealth Laboratories, Inc.’s Current Report on Form 8-K filed on June 14, 2001)

4.4.1	Series A Preferred Stock Purchase Agreement dated January 28, 2005, by and between PacificHealth Laboratories, Inc. and Hormel HealthLabs, LLC (incorporated by reference to Exhibit 4.3 to PacificHealth Laboratories, Inc.’s Annual Report on Form 10-KSB filed on April 15, 2005)

4.4.2	Investors’ Rights Agreement dated January 28, 2005, by and between PacificHealth Laboratories, Inc. and Hormel HealthLabs, LLC (incorporated by reference to Exhibit 4.4 to PacificHealth Laboratories, Inc.’s Annual Report on Form 10-KSB filed on April 15, 2005)

Exhibit Number	Description of Exhibit⁽¹⁾

4.4.3	Right of First Refusal and Co-Sale Agreement dated January 28, 2005, by and between PacificHealth Laboratories, Inc., Robert Portman and Hormel HealthLabs, LLC (incorporated by reference to Exhibit 4.5 to PacificHealth Laboratories, Inc.’s Annual Report on Form 10-KSB filed on April 15, 2005)

4.4.4	Certificate of Designations for Series A Preferred Stock (incorporated by reference to Exhibit 3.1 to PacificHealth Laboratories, Inc.’s Current Report on Form 8-K filed on January 28, 2005)

4.5	Certificate of Designations for Series B Preferred Stock, filed with the Secretary of State of the State of Delaware on April 28, 2005 (incorporated by reference to Exhibit 3(i) to PacificHealth Laboratories, Inc.’s Current Report on Form 8-K filed on May 4, 2005)

4.6.1	Securities Purchase Agreement, dated August 24, 2005 by and between PacificHealth Laboratories, Inc. and Hormel HealthLabs, LLC (incorporated by reference to Exhibit 10.1 to PacificHealth Laboratories, Inc.’s Current Report on Form 8-K filed on August 30, 2005)

4.6.2	Amended and Restated Investors’ Rights Agreement dated August 24, 2005 between PacificHealth Laboratories, Inc. and Hormel HealthLabs, LLC and any additional investor that becomes a party thereto (incorporated by reference to Exhibit 4.1 to PacificHealth Laboratories, Inc.’s Current Report on Form 8-K filed on August 30, 2005)

4.6.3	Form of Secured Convertible Promissory Note issued in connection with Exhibit 4.6.1 (incorporated by reference to Exhibit 10.2 to PacificHealth Laboratories, Inc.’s Current Report on Form 8-K filed on August 30, 2005)

4.6.4	Security Agreement dated August 24, 2005 by and between PacificHealth Laboratories, Inc. and Hormel HealthLabs, LLC (incorporated by reference to Exhibit 10.3 to PacificHealth Laboratories, Inc.’s Current Report on Form 8-K filed on August 30, 2005)

10.1	Employment Extension Agreement between PacificHealth Laboratories, Inc. and Robert Portman effective January 1, 2004, executed February 28, 2006 (incorporated by reference to Exhibit 10.6 to PacificHealth Laboratories, Inc.’s Post-Effective Amendment to Registration Statement on Form SB-2/A (File No. 333-109197) filed on May 2, 2006)


10.2.1	Asset Purchase Agreement dated February 22, 2006, by and between PacificHealth Laboratories, Inc. and Mott’s LLP (redacted, subject to request for confidential treatment) (incorporated by reference to Exhibit 10.8 to PacificHealth Laboratories, Inc.’s Annual report on Form 10-KSB filed on March 31, 2006)

10.2.2	License Agreement dated February 22, 2006, by and between PacificHealth Laboratories, Inc. and Mott’s LLP (redacted, subject to request for confidential treatment) (incorporated by reference to Exhibit 10.9 to PacificHealth Laboratories, Inc.’s Annual report on Form 10-KSB filed on March 31, 2006)

10.2.3	Consulting, License and Noncompetition Agreement dated February 22, 2006, by and between PacificHealth Laboratories, Inc., Mott’s LLP and Robert Portman (redacted, subject to request for confidential treatment) (incorporated by reference to Exhibit 10.10 to PacificHealth Laboratories, Inc.’s Annual report on Form 10-KSB filed on March 31, 2006)

31.1	Rule 13a-14(a) Certification of Chief Executive Officer (filed herewith)

31.2	Rule 13a-14(a) Certification of Chief Financial Officer (filed herewith)

Exhibit Number	Description of Exhibit⁽¹⁾

32	Certifications of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (filed herewith)

(1)	In the case of incorporation by reference to documents filed by the Registrant under the Exchange Act, the Registrant’s file number under the Exchange Act is 000-23495.