Quarterly report pursuant to Section 13 or 15(d)

Condensed Statements of Cash Flows (Unaudited)

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Condensed Statements of Cash Flows (Unaudited) (USD $)
6 Months Ended
Jun. 30, 2011
Jun. 30, 2010
Cash flows from operating activities:    
Net income (loss) $ 1,155,650 $ (476,316)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:    
Compensation expense related to issuance of stock options 364,218 26,156
Depreciation expense 1,290 1,510
Amortization of patent costs 8,102 9,387
Deferred income tax 520,000 (277,000)
Interest added to notes receivable (20,712)  
Changes in operating assets and liabilities:    
Royalty receivable 23,006 28,271
Prepaid expenses and other 470,001 88,280
Income tax payable 350,000 (952,000)
Accounts payable 145,058 (42,895)
Accrued expenses 2,164 (269,079)
Net cash provided by (used in) operating activities 3,018,777 (1,863,686)
Cash flows from investing activities:    
Net redemption of certificates of deposit 244,725  
Increase in notes receivable (2,500,000)  
Purchase of office equipment   (1,257)
Investment in patents   (7,731)
Net cash provided by (used in) investing activities (2,255,275) (8,988)
Cash flows from financing activities:    
Payments of dividend   (4,298,350)
Stock option exercised   39,000
Net cash used in financing activities   (4,259,350)
Net increase (decrease) in cash and cash equivalents 763,502 (6,132,024)
Cash and cash equivalents - beginning of period 7,076,827 15,766,107
Cash and cash equivalents - end of period $ 7,840,329 $ 9,634,083