10-Q

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549

                                    FORM 10-Q

(Mark One)

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

            For the quarterly period ended     March 31, 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 number 0-21617

                             THE QUIGLEY CORPORATION
                             -----------------------
             (Exact Name of Registrant as Specified in Its Charter)

      Nevada                                             23-2577138
- --------------------------------------------------------------------------------
(State or Other Jurisdiction of             (I.R.S. Employer Identification No.)
 Incorporation or Organization)

              (MAILING ADDRESS: PO Box 1349, Doylestown, PA 18901.)

Kells Building, 621 Shady Retreat Road, Doylestown, Pennsylvania     18901
- --------------------------------------------------------------------------------
(Address of Principal Executive Offices)                          (Zip Code)

                                 (215) 345-0919
                         -------------------------------
                         (Registrant's Telephone Number,
                              Including Area Code)

                                       N/A
- --------------------------------------------------------------------------------
            (Former Name, Former Address and Former Fiscal Year, if
                           Changed Since Last Report)

Indicate  by check  mark  whether  the  registrant:  (1) has filed  all  reports
required to be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of
1934  during  the  preceding  12 months  (or for such  shorter  period  that the
registrant was required to file such reports),  and (2) has been subject to such
filing requirements for the past 90 days. Yes [X] No [ ]

Indicate by check mark whether the registrant is a large  accelerated  filer, an
accelerated  filer, or a  non-accelerated  filer. See definition of "accelerated
filer and large  accelerated  filer" in Rule 12b-2 of the Exchange  Act.  (Check
one):
Large Accelerated Filer [ ] Accelerated Filer [X] Non-Accelerated  Filer [ ]

Indicate by check mark whether the  registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act). Yes [ ] No [X]

Indicate the number of shares  outstanding  of each of the  issuer's  classes of
common stock, as of the latest practicable date.

As of May 4, 2007,  there were  12,684,633  shares of common  stock,  $.0005 par
value per share, outstanding.




                                TABLE OF CONTENTS

                                                                        Page No.
             PART I - FINANCIAL INFORMATION

      Item 1.     Condensed Consolidated Financial Statements               3-15

      Item 2.     Management's Discussion and Analysis of
                  Financial Condition and Results of Operations            16-25

      Item 3.     Quantitative and Qualitative Disclosures About
                  Market Risk                                                 25

      Item 4.     Controls and Procedures                                     25

             PART II - OTHER INFORMATION

      Item 1.     Legal Proceedings                                        26-28

      Item 6.     Exhibits                                                    29

      Signatures


                                      -2-


                                           PART I. FINANCIAL INFORMATION

ITEM 1.  CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

                                             THE QUIGLEY CORPORATION
                                      CONDENSED CONSOLIDATED BALANCE SHEETS

                          ASSETS                                            March   31, 2007    December 31, 2006
                                                                              (Unaudited)
                                                                           ------------------   -----------------
CURRENT ASSETS:

         Cash and cash equivalents                                           $ 19,175,912          $ 17,756,759
         Accounts receivable (net of doubtful                                   2,745,930             6,557,347
           accounts of $244,559 and $275,636)
         Inventory                                                              4,163,556             4,262,104
         Prepaid expenses and other current assets                                983,523             1,217,097
                                                                             ------------          ------------
              TOTAL CURRENT ASSETS                                             27,068,921            29,793,307
                                                                             ------------          ------------

PROPERTY, PLANT AND EQUIPMENT - NET                                             4,798,372             4,838,076
                                                                             ------------          ------------

OTHER ASSETS                                                                      130,862               213,651
                                                                             ------------          ------------

TOTAL ASSETS                                                                 $ 31,998,155          $ 34,845,034
                                                                             ============          ============

             LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:

         Accounts payable                                                         661,968               885,648
         Accrued royalties and commissions                                      3,978,401             3,752,646
         Accrued advertising                                                      708,027             2,150,259
         Other current liabilities                                              2,983,557             2,463,481
                                                                             ------------          ------------
              TOTAL CURRENT LIABILITIES                                         8,331,953             9,252,034
                                                                             ------------          ------------

MINORITY INTEREST                                                                  64,971                63,563

COMMITMENTS AND CONTINGENCIES (NOTE 6)

STOCKHOLDERS' EQUITY:

         Common stock, $.0005 par value; authorized 50,000,000;
           Issued: 17,330,686 and 17,330,686 shares                                 8,665                 8,665
         Additional paid-in-capital                                            37,362,453            37,362,453
         Retained earnings                                                     11,418,272            13,346,478
         Less: Treasury stock, 4,646,053 and                                  (25,188,159)          (25,188,159)
           4,646,053 shares, at cost                                         ------------          ------------
              TOTAL STOCKHOLDERS' EQUITY                                       23,601,231            25,529,437
                                                                             ------------          ------------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                                   $ 31,998,155          $ 34,845,034
                                                                             ============          ============

                      See accompanying notes to condensed consolidated financial statements


                                                      -3-


                             THE QUIGLEY CORPORATION
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (Unaudited)

                                                      Three Months Ended
                                               March 31, 2007    March 31, 2006
                                               --------------    --------------

NET SALES                                       $  9,077,876      $ 10,266,038
                                                ------------      ------------

COST OF SALES                                      4,067,856         4,953,454
                                                ------------      ------------

GROSS PROFIT                                       5,010,020         5,312,584
                                                ------------      ------------

OPERATING EXPENSES:
      Sales and marketing                          2,733,543         2,434,925
      Administration                               3,212,155         3,705,761
      Research and development                     1,152,662           784,523
                                                ------------      ------------
TOTAL OPERATING EXPENSES                           7,098,360         6,925,209
                                                ------------      ------------

LOSS FROM OPERATIONS                              (2,088,340)       (1,612,625)
                                                ------------      ------------

OTHER INCOME (EXPENSE)
      Interest and other income                      160,134           179,974
      Interest expense                                  --             (21,644)
                                                ------------      ------------
TOTAL OTHER INCOME (EXPENSE)                         160,134           158,330
                                                ------------      ------------

LOSS  FROM OPERATIONS  BEFORE TAXES
                                                  (1,928,206)       (1,454,295)
INCOME TAXES (BENEFIT)                                  --                --
                                                ------------      ------------

NET LOSS                                        ($ 1,928,206)     ($ 1,454,295)
                                                ============      ============

LOSS PER COMMON SHARE:
     Basic                                      $      (0.15)     $      (0.12)
                                                ============      ============

     Diluted                                    $      (0.15)     $      (0.12)
                                                ============      ============

WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:
      Basic                                       12,684,633        11,714,140
                                                ============      ============

      Diluted                                     12,684,633        11,714,140
                                                ============      ============

      See accompanying notes to condensed consolidated financial statements


                                      -4-


                             THE QUIGLEY CORPORATION
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (Unaudited)

                                                      Three Months Ended
                                               March 31, 2007    March 31, 2006
                                               --------------    --------------

NET CASH PROVIDED BY OPERATING ACTIVITIES       $  1,631,835      $  1,503,382
                                                ------------      ------------

NET CASH FLOWS USED IN INVESTING ACTIVITIES         (212,682)         (140,966)
                                                ------------      ------------

NET CASH FLOWS USED IN FINANCING ACTIVITIES             --             (57,167)
                                                ------------      ------------

NET INCREASE IN CASH                               1,419,153         1,305,249

CASH & CASH EQUIVALENTS, BEGINNING OF PERIOD      17,756,759        16,885,170
                                                ------------      ------------

CASH & CASH EQUIVALENTS, END OF PERIOD          $ 19,175,912      $ 18,190,419
                                                ============      ============

      See accompanying notes to condensed consolidated financial statements


                                      -5-


                             THE QUIGLEY CORPORATION
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

NOTE 1 - ORGANIZATION AND BUSINESS

The Quigley  Corporation (the "Company"),  organized under the laws of the state
of Nevada,  is engaged  in the  development,  manufacturing,  and  marketing  of
homeopathic and health products that are being offered to the general public and
the research and development of potential  prescription products. The Company is
organized  into four  business  segments:  Cold  Remedy,  Health  and  Wellness,
Contract  Manufacturing  and  Ethical  Pharmaceutical.  For the  fiscal  periods
presented,  the majority of the Company's  revenues have come from the Company's
Cold Remedy and Health and Wellness business segments.

The Company's  principal  cold-remedy  product,  Cold-Eeze(R),  a zinc gluconate
glycine formulation  (ZIGG(TM)) is an over-the-counter  consumer product used to
reduce the duration  and  severity of the common  cold.  The lozenge form of the
product is manufactured by Quigley  Manufacturing  Inc. ("QMI"),  a wholly owned
subsidiary of the Company, which was formed following the acquisition of certain
assets and  assumption  of  certain  liabilities  of JoEl,  Inc.,  the  contract
manufacturer of the lozenge product prior to October 1, 2004.

Darius International Inc. ("Darius"),  a wholly owned subsidiary of the Company,
is a direct selling  organization  constituting  the Health and Wellness segment
that was formed in January  2000 to introduce  new  products to the  marketplace
through a network of independent distributor representatives.

In January 2001, the Company formed an Ethical  Pharmaceutical  segment which is
now Quigley Pharma Inc.  ("Pharma"),  a wholly-owned  subsidiary of the Company.
The result of that segment's  research and  development  activity may enable the
Company to diversify into the prescription drug market.

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

BASIS OF PRESENTATION

The  Condensed  Consolidated  Financial  Statements  include the accounts of the
Company and its wholly owned  subsidiaries.  All inter-company  transactions and
balances  have  been  eliminated.   Effective  March  31,  2004,  the  financial
statements include consolidated variable interest entities ("VIEs") of which the
Company is the primary beneficiary (see discussion in Note 3, "Variable Interest
Entity").

These financial  statements  have been prepared by management  without audit and
should be read in conjunction  with the  consolidated  financial  statements and
notes thereto  included in the Company's Annual Report on Form 10-K for the year
ended December 31, 2006. In the opinion of management, all adjustments necessary
for a fair  presentation of the consolidated  financial  position,  consolidated
results of operations and consolidated  cash flows,  for the periods  indicated,
have been made.  The results of  operations  for the three month  periods  ended
March 31,  2007 and 2006 are not  necessarily  indicative  of the  results to be
expected for the entire year or any other period.

USE OF ESTIMATES

The Company's  consolidated financial statements are prepared in accordance with
generally  accepted  accounting  principles  ("GAAP")  in the  United  Sates  of
America.  In  connection  with the  preparation  of the  consolidated  financial
statements,  the Company is required to make  assumptions  and  estimates  about
future events,  and apply judgments that affect the reported  amounts of assets,
liabilities,  revenue,  expenses  and related  disclosures.  These  assumptions,
estimates and judgments are based on historical  experience,  current trends and
other  factors  that  management  believes  to  be  relevant  at  the  time  the
consolidated   financial   statements  are  prepared.   Management  reviews  the
accounting policies,  assumptions,  estimates and judgments on a quarterly basis
to ensure the financial  statements are presented  fairly and in accordance with
GAAP. However, because future events and their effects cannot be determined with
certainty, actual results could differ from these assumptions and estimates, and
such differences could be material.

The Company is organized  into four  different  but related  business  segments,
Cold-Remedy,   Health  and   Wellness,   Contract   Manufacturing   and  Ethical
Pharmaceutical.  When providing for the appropriate  sales returns,  allowances,
cash discounts and cooperative incentive promotion costs, each segment applies a
uniform and  consistent  method for making  certain  assumptions  for estimating
these  provisions that are applicable to each specific  segment.  Traditionally,
these  provisions  are not  material  to  reported  revenues  in the  Health and
Wellness and  Contract  Manufacturing  segments  and the Ethical  Pharmaceutical
segment does not have any revenues.


                                      -6-


Provisions to these reserves  within the Cold Remedy segment  include the use of
such estimates, which are applied or matched to the current sales for the period
presented.  These  estimates  are based on  specific  customer  tracking  and an
overall historical  experience to obtain an applicable effective rate. Estimates
for sales returns are tracked at the specific  customer  level and are tested on
an annual  historical  basis,  and  reviewed  quarterly,  as is the estimate for
cooperative  incentive promotion costs. Cash discounts follow the terms of sales
and are taken by  virtually  all  customers.  Additionally,  the  monitoring  of
current occurrences,  developments by customer,  market conditions and any other
occurrences that could affect the expected  provisions for any future returns or
allowances, cash discounts and cooperative incentive promotion costs relative to
net sales for the period presented are also performed.

CASH EQUIVALENTS

The Company considers all highly liquid  investments with an initial maturity of
three  months  or less at the  time of  purchase  to be cash  equivalents.  Cash
equivalents  include cash on hand and monies invested in money market funds. The
carrying  amount  approximates  the  fair  market  value  due to the  short-term
maturity of these investments.

INVENTORY VALUATION

Inventory is valued at the lower of cost,  determined  on a first-in,  first-out
basis (FIFO), or market.  Inventory items are analyzed to determine cost and the
market  value  and  appropriate   valuation   reserves  are   established.   The
consolidated  financial  statements  include a  specific  reserve  for excess or
obsolete  inventory  of $387,636  and $430,926 as of March 31, 2007 and December
31, 2006, respectively.  Inventories included raw material, work in progress and
packaging  amounts of approximately  $1,194,000 and $1,077,000 at March 31, 2007
and December 31, 2006,  respectively,  with the  remainder  comprising  finished
goods.

PROPERTY, PLANT  AND EQUIPMENT

Property,  plant  and  equipment  are  recorded  at  cost.  The  Company  uses a
combination of straight-line and accelerated  methods in computing  depreciation
for financial reporting purposes. The annual provision for depreciation has been
computed in  accordance  with the  following  ranges of  estimated  asset lives:
building and improvements - twenty to thirty nine years; machinery and equipment
- - five to seven  years;  computer  software - three  years;  and  furniture  and
fixtures - seven years.

CONCENTRATION OF RISKS

Financial  instruments  that  potentially  subject  the  Company to  significant
concentrations of credit risk consist  principally of cash investments and trade
accounts receivable.

The Company  maintains cash and cash  equivalents  with several major  financial
institutions.  Since the  Company  maintains  amounts  in  excess of  guarantees
provided by the Federal Depository Insurance  Corporation,  the Company performs
periodic  evaluations  of  the  relative  credit  standing  of  these  financial
institutions and limits the amount of exposure with any one institution.

Trade accounts  receivable  potentially  subject the Company to credit risk. The
Company  extends  credit  to its  customers  based  upon  an  evaluation  of the
customer's financial condition and credit history and generally does not require
collateral.  It is not  anticipated  that any one  customer  will  exceed 10% of
consolidated sales in 2007. The Company's broad range of customers includes many
large wholesalers,  mass merchandisers and multi-outlet pharmacy chains, five of
which account for a significant percentage of sales volume, representing 31% and
26% of sales volume for the respective  three month periods ended March 31, 2007
and  2006,   respectively.   Customers  comprising  the  five  largest  accounts
receivable  balances  represented 47% and 56% of total trade receivable balances
at March 31, 2007 and December 31, 2006, respectively.  During each of the three
month periods ended March 31, 2007 and 2006,  approximately 11% of the Company's
net sales were related to international markets.

The Company's revenues are currently  generated from the sale of the Cold-Remedy
products  which  approximated  61% and 50% of total  revenues in the three month
periods  ended March 31, 2007 and 2006,  respectively.  The Health and  Wellness
segment  approximated  32% and 45%,  respectively,  for the three month  periods
ended March 31, 2007 and 2006. The Contract  Manufacturing  segment approximated
7% and 5%,  respectively,  for the three month  periods ended March 31, 2007 and
2006.

Raw materials used in the production of the products are available from numerous
sources.  Raw  materials  for the  Cold-Eeze(R)  lozenge  product  is  currently
procured  from a single  vendor in order to secure  purchasing  economies.  In a



                                      -7-


situation where this one vendor is not able to supply QMI with the  ingredients,
other sources have been  identified.  Should these product sources  terminate or
discontinue  for any reason,  the Company has  formulated a contingency  plan in
order to prevent such  discontinuance  from  materially  affecting the Company's
operations.  Any such termination may,  however,  result in a temporary delay in
production  until  the  replacement  facility  is  able to  meet  the  Company's
production requirements.

Darius' products for resale can be sourced from several suppliers.  In the event
that such sources were no longer in a position to supply  Darius with  products,
other vendors have been identified as reliable alternatives with minimal adverse
loss of business.

LONG-LIVED ASSETS

The Company  reviews its long-lived  assets for impairment on an exception basis
whenever events or changes in circumstances indicate that the carrying amount of
the assets may not be recoverable through future cash flows. If it is determined
that an impairment  loss has occurred  based on the expected cash flows compared
to the related asset value, an impairment loss is recognized in the Statement of
Operations.

REVENUE RECOGNITION

Sales are recognized at the time ownership is transferred to the customer, which
for the Cold Remedy segment is the time the shipment is received by the customer
and for both the Health and  Wellness  segment  and the  Contract  Manufacturing
segment,  when the  product is shipped to the  customer.  Revenue is reduced for
trade promotions,  estimated sales returns,  cash discounts and other allowances
in the same  period  as the  related  sales  are  recorded.  The  Company  makes
estimates of potential  future product returns and other  allowances  related to
current period revenue. The Company analyzes historical returns, current trends,
and changes in customer and consumer  demand when evaluating the adequacy of the
sales  returns  and other  allowances.  The  consolidated  financial  statements
include  reserves of $438,256  for future  sales  returns and $332,565 for other
allowances  as of March 31, 2007 and $534,176 and $429,546 at December 31, 2006,
respectively.  The 2007 and 2006 reserve  balances  include a remaining  returns
provision at March 31, 2007 and December 31, 2006 of approximately  $112,000 and
$113,000,  respectively,  in the event of future product  returns  following the
discontinuation of the Cold-Eeze(R) Cold Remedy Nasal Spray product in September
2004. The reserves also include an estimate of the  uncollectability of accounts
receivable resulting in a reserve of $244,559 and $275,636 at March 31, 2007 and
December 31, 2006, respectively.

COST OF SALES

For the Cold  Remedy  segment,  in  accordance  with  contract  terms,  payments
calculated  based  upon  net  sales  collected  to  the  patent  holder  of  the
Cold-Eeze(R)  formulation amounting to $257,996 and $242,514  respectively,  for
the three  month  periods  ended March 31,  2007 and 2006 are  presented  in the
financial statements as cost of sales (see also Note 4).

In the Health and Wellness  Segment,  agreements  with  Independent  Distributor
Representatives  ("IR's")  require  payments to them to be calculated based upon
net  commissionable  sales of other  IR's in their  down-line  and not on any of
their  individual  purchases  of  products  including  not  taking  title to the
products  that are sold by other  IR's.  In  accordance  with  EITF  01-9,  such
payments to the IR's do not qualify as a reduction of the selling price as these
payments are not offered as an  allowance  or as a  percentage  rebate of direct
purchases  made,  and  the  IR's  are  not  offered  any  cooperative  promotion
incentives  of any type.  Such  payments,  among other  factors,  are related to
expand the cycle of additional IR's and for maintaining the distribution channel
for this segment's products.

Accordingly,  such distribution  payments amounting to $1,132,549 and $2,052,714
for the three month periods ended March 31, 2007 and 2006, respectively, and are
presented in the financial statements as cost of sales.

OPERATING EXPENSES

Agreements  relating  to the Cold Remedy  segment  with a major  national  sales
brokerage firm are for this firm to sell the manufactured  Cold-Eeze(R)  product
to our customers.  Such related costs are presented in the financial  statements
as selling expenses.

In the Health and Wellness Segment,  the Company includes payments in accordance
with agreements with the former owner of its acquired proprietary  products,  to
be  calculated  based upon net sales  collected.  These  agreements  provide for
exclusivity,   consulting,   marketing   presentations,    confidentiality   and
non-compete  arrangements  with such payments being classified as administration
expense.


                                      -8-


SHIPPING AND HANDLING

Product  sales  relating to Health and  Wellness  products  carry an  additional
identifiable shipping and handling charge to the purchaser,  which is classified
as revenue. For the Cold Remedy and Contract Manufacturing  segments, such costs
are included as part of the invoiced  price.  In all cases costs related to this
revenue are recorded in cost of sales.

STOCK COMPENSATION

Stock options and warrants for purchase of the Company's  common stock have been
granted to both  employees and  non-employees  since the date the Company became
publicly traded. Options and warrants are exercisable during a period determined
by the Company, but in no event later than ten years from the date granted.

As of January 1, 2006, the Company adopted SFAS 123R, "SHARE BASED PAYMENT". The
adoption of SFAS 123R did not have an impact on the Company's financial position
or results of operations in the 2007 and 2006 periods reported.

No stock  options were granted in the three month  periods  ended March 31, 2007
and 2006. All stock options granted prior to January 1, 2006 were fully vested.

ADVERTISING AND INCENTIVE PROMOTIONS

Advertising  and  incentive  promotion  costs are expensed  within the period in
which  they  are  utilized.  Advertising  and  incentive  promotion  expense  is
comprised  of  media  advertising,  presented  as part of  sales  and  marketing
expense;  cooperative incentive promotion, which is accounted for as part of net
sales;  and free  product,  which  is  accounted  for as part of cost of  sales.
Advertising  and incentive  promotion costs incurred for the three month periods
ended  March 31, 2007 and 2006 were  $2,590,416  and  $2,035,284,  respectively.
Included in prepaid  expenses and other current  assets was zero and $258,215 at
March  31,  2007 and  December  31,  2006,  respectively,  relating  to  prepaid
advertising and promotion expenses.

RESEARCH AND DEVELOPMENT

Research and development costs are charged to operations in the period incurred.
Expenditures  for the three  month  periods  ended  March 31, 2007 and 2006 were
$1,152,662 and $784,523,  respectively.  Principally,  research and  development
costs are  related  to  Pharma's  study  activities  and costs  associated  with
Cold-Eeze(R) products.

INCOME TAXES

The  Company  utilizes  the asset and  liability  approach  which  requires  the
recognition  of  deferred  tax  assets  and   liabilities  for  the  future  tax
consequences  of events that have been  recognized  in the  Company's  financial
statements or tax returns.  In estimating future tax  consequences,  the Company
generally  considers all expected future events other than enactments of changes
in the tax law or rates. Until sufficient taxable income to offset the temporary
timing   differences   attributable   to  operations   and  the  tax  deductions
attributable to option,  warrant and stock  activities are assured,  a valuation
allowance equaling the total deferred tax asset is being provided.  See Note 8 -
Income Taxes for further discussion.

Effective  January 1, 2007, the Company adopted Financial  Accounting  Standards
Board ("FASB") Interpretation No. 48, ACCOUNTING FOR UNCERTAINTY IN INCOME TAXES
(FIN 48).  FIN 48  clarifies  the  accounting  for  uncertainty  in income taxes
recognized in an  enterprise's  financial  statements  in  accordance  with SFAS
Statement No. 109,  ACCOUNTING FOR INCOME TAXES. FIN 48 prescribes a recognition
threshold and measurement  attribute for the financial statement recognition and
measurement of a tax position taken or expected to be taken in a tax return. FIN
48  also  provides  guidance  on  derecognition,  classification,  interest  and
penalties, accounting in interim periods, disclosure and transition. Adoption of
this  standard did not have an impact on the  Company's  consolidated  financial
position,  results of operations or cash flows. Our evaluation was performed for
the tax years  ended  2003,  2004,  2005 and 2006,  the tax years  which  remain
subject to examination by major tax jurisdictions as of March 31, 2007.

FAIR VALUE OF FINANCIAL INSTRUMENTS

Cash  and  cash  equivalents,  accounts  receivable  and  accounts  payable  are
reflected  in the  consolidated  financial  statements  at carrying  value which
approximates fair value because of the short-term maturity of these instruments.
The fair value of long- term debt was  approximately  equivalent to its carrying
value due to the fact that the interest  rates then available to the Company for
debt with similar terms was  approximately  equal to the interest  rates for its
existing debt.  Determination of the fair value of related party payables is not
practicable due to their related party nature.


                                      -9-


RECENTLY ISSUED ACCOUNTING STANDARDS

In February 2007, the Financial  Accounting Standards Board ("FASB") issued SFAS
No. 159, The Fair Value Option for Financial Assets and Financial  Liabilities -
Including  an  amendment  of FASB No. 115 ("FAS  159").  The  Statement  permits
companies  to choose to measure many  financial  instruments  and certain  other
items at fair value in order to mitigate  volatility in reported earnings caused
by measuring related assets and liabilities  differently without having to apply
complex  hedge  accounting  provisions.  FAS 159 is  effective  for the  Company
beginning  January 1, 2008. The Company is currently  evaluating the impact,  if
any, of FAS 159 on its operating results and financial position.

NOTE 3 - VARIABLE INTEREST ENTITY

In December 2003, the FASB issued FASB  Interpretation  No. 46 (revised December
2003), CONSOLIDATION OF VARIABLE INTEREST ENTITIES (FIN 46R), to address certain
implementation issues. FIN 46R varies significantly from FASB Interpretation No.
46,  CONSOLIDATION  OF  VARIABLE  INTEREST  ENTITIES("VIE")  (FIN 46),  which it
supersedes.  FIN 46R  requires  the  application  of either FIN 46 or FIN 46R by
"Public  Entities" to all Special  Purpose  Entities  ("SPEs") at the end of the
first interim or annual reporting period ending after December 15, 2003. FIN 46R
is  applicable  to all  non-SPEs  created  prior to  February  1, 2003 by Public
Entities that are not small business  issuers at the end of the first interim or
annual reporting  period ending after March 15, 2004.  Effective March 31, 2004,
the Company  adopted  FIN 46R for VIE's  formed  prior to February 1, 2003.  The
Company has  determined  that  Scandasystems,  a related  party,  qualifies as a
variable  interest  entity  and  the  Company  has  consolidated   Scandasystems
beginning  with the  quarter  ended  March  31,  2004.  Due to the fact that the
Company has no long-term  contractual  commitments  or  guarantees,  the maximum
exposure to loss is insignificant. As a result of consolidating the VIE of which
the  Company is the  primary  beneficiary,  the  Company  recognized  a minority
interest of approximately $64,971 and $63,563 on the Consolidated Balance Sheets
at March 31, 2007 and December  31, 2006,  respectively,  which  represents  the
difference   between  the  assets  and  the   liabilities   recorded   upon  the
consolidation of the VIE.

The liabilities recognized as a result of consolidating the VIE do not represent
additional claims on the Company's general assets. Rather, they represent claims
against  the  specific  assets  of  the  consolidated  VIE.  Conversely,  assets
recognized as a result of  consolidating  this VIE do not  represent  additional
assets  that could be used to  satisfy  claims  against  the  Company's  general
assets. Reflected on the Company's Consolidated Balance Sheets at March 31, 2007
and  December  31,  2006,  respectively,  are $72,644 and $64,592 of VIE assets,
representing  all of the  assets of the VIE.  The VIE  assists  the  Company  in
acquiring  licenses and with  research  and  development  activities  in certain
countries.

NOTE 4 - PATENT RIGHTS AND RELATED ROYALTY COMMITMENTS

The Company has maintained a separate  representation and distribution agreement
relating to the development of the zinc gluconate  glycine product  formulation.
In return for exclusive  distribution rights, the Company must pay the developer
a 3% royalty and a 2%  consulting  fee based on sales  collected,  less  certain
deductions,  throughout  the term of this  agreement,  which is due to expire in
2007.  However,  the Company and the developer are in litigation  and as such no
potential offset from such litigation for these fees have been recorded.

The expenses for the respective  periods relating to such agreement  amounted to
$257,996  and  $242,514,  for the three month  periods  ended March 31, 2007 and
2006,  respectively.  Amounts  accrued for these  expenses at March 31, 2007 and
December 31, 2006 were $3,488,761 and $3,230,765,  respectively, all non-related
party balances.

NOTE 5 - OTHER CURRENT LIABILITIES

Included in other  current  liabilities  are $660,280  and  $234,208  related to
accrued compensation at March 31, 2007 and December 31, 2006, respectively.

NOTE 6 - COMMITMENTS AND CONTINGENCIES

Certain  operating  leases for  office and  warehouse  space  maintained  by the
Company  resulted in rent  expense for the three month  periods  ended March 31,
2007 and 2006 of $95,438, and $64,588, respectively. The Company has approximate
future obligations over the next five years as follows:


                                      -10-


                                     Property
                     Research and    and Other
        Year         Development       Leases      Other       Total
        ---------------------------------------------------------------
        2007          $2,615,057   $  174,356   $  936,350   $3,725,763
        2008                --        194,361         --        194,361
        2009                --        108,355         --        108,355
        2010                --           --           --           --
        2011                --           --           --           --
        2012                --           --           --           --
        ---------------------------------------------------------------
        Total         $2,615,057   $  477,072   $  936,350   $4,028,479
        ---------------------------------------------------------------

Additional research and development costs are expected to be incurred during the
remainder of 2007.

Other includes new products procurement  commitments for the cold remedy segment
with initial sales of these products expected to occur during the second half of
2007.

The Company has an  agreement  with the former  owners of the Utah based  direct
marketing  and selling  company,  whereby the former  owners  receive  payments,
currently  totaling  5%  of  net  sales  collected,   for  product  exclusivity,
consulting,    marketing   presentations,    confidentiality   and   non-compete
arrangements.  However,  the Company and the former owners are in litigation and
as such no  potential  offset  from such  litigation  for  these  fees have been
recorded.  Amounts paid or payable under such  agreement  during the three month
periods ended March 31, 2007 and 2006 were $108,606 and $190,639,  respectively.
Amounts payable under such agreement,  included in other current liabilities, at
March 31, 2007 and December 31, 2006 were $637,240 and $528,990, respectively.

The Company has several licensing and other contractual agreements, see Note 4.

              TESAURO AND ELEY, ET AL. VS. THE QUIGLEY CORPORATION
                  (CCP OF PHILA., AUGUST TERM 2000, NO. 001011)

In September,  2000, the Company was sued by two individuals  (Jason Tesauro and
Elizabeth Eley, both residents of Georgia), allegedly on behalf of a "nationwide
class" of  "similarly  situated  individuals,"  in the Court of Common  Pleas of
Philadelphia  County,  Pennsylvania.  The  Complaint  further  alleges  that the
plaintiffs  purchased  certain  Cold-Eeze  products  between  August,  1996, and
November, 1999, based upon cable television,  radio and internet advertisements,
which  allegedly  misrepresented  the  qualities  and benefits of the  Company's
products. The Complaint, as pleaded originally,  requested an unspecified amount
of damages for violations of Pennsylvania's  consumer  protection law, breach of
implied warranty of merchantability and unjust enrichment, as well as a judicial
determination that the action be maintained as a class action. In October, 2000,
the Company filed  Preliminary  Objections to the Complaint seeking dismissal of
the  action.   The  court  sustained  certain   objections,   thereby  narrowing
plaintiffs' claims.

In May 2001,  plaintiffs  filed a motion to  certify  the  putative  class.  The
Company  opposed  the motion.  In  November,  2001,  the court held a hearing on
plaintiffs' motion for class certification.  In January,  2002, the court denied
in part and granted in part  plaintiffs'  motion.  The court denied  plaintiffs'
motion to  certify a class  based on  plaintiffs'  claims  under  Pennsylvania's
consumer   protection  law,  under  which  plaintiffs   sought  treble  damages,
effectively  dismissing  this cause of action;  however,  the court  certified a
class  based on  plaintiffs'  secondary  breach of implied  warranty  and unjust
enrichment claims. In August, 2002, the court issued an order adopting a form of
Notice of Class Action to be published  nationally.  The form of Notice approved
by the court included a provision  which limits the potential  class members who
may  potentially  recover  damages in this action to those persons who present a
proof of purchase of Cold-Eeze during the period August 1996 and November 1999.

Afterward,  a series of pre-trial  motions were filed raising issues  concerning
trial  evidence  and the court's  jurisdiction  over the  subject  matter of the
action. In March, 2005, the court held oral argument on these motions.

On  November  8, 2006,  the Court  entered an Order  dismissing  the case in its
entirety  on the basis  that the  action  was  preempted  by  federal  law.  The
plaintiffs  appealed the Court's decision in December,  2006. On March 22, 2007,
the  Superior  Court  entered  a  scheduling  order  for  briefing.  On  May  1,
plaintiffs/appellants filed their opening brief. The Company's brief in response
is due on May 30, 2007.

For the reasons stated by the Court in dismissing the case, as well as for other
reasons,  the Company  believes  that  plaintiffs'  case on appeal  lacks merit;
however, no prediction as to the outcome of the appeal can be made.


                                      -11-


               MONIQUE FONTENOT DOYLE VS. THE QUIGLEY CORPORATION
                  (U.S.D.C., W.D. LA. DOCKET NO.: 6:06CV1497)

On August 31, 2006,  the  plaintiff  filed an action  against the Company in the
United   States   District   Court  for  the  Western   District  of   Louisiana
(Lafayette-Opelousas  Division).  The  action  alleges  the  plaintiff  suffered
certain  losses and injuries as a result of the Company's  nasal spray  product.
Among the allegations of plaintiff are breach of express  warranties and damages
pursuant to the Louisiana Products Liability Act.

At the present  time this matter is being  defended by the  Company's  liability
insurance  carrier.  However,  the Company has been tendered the defense of this
action for which there is no insurance. The Company is vigorously defending this
lawsuit and  believes  that the action  lacks  merit.  However,  at this time no
prediction as to the outcome of the case can be made.

                 GREG SCRAGG VS. THE QUIGLEY CORPORATION, ET AL.
               (U.S.D.C, D. COLO. DOCKET NO.: 06- 00061 LTB-CBS)

On November  30, 2005,  an action was brought in the  District  Court of Denver,
Colorado.  The complaint was served on the Company soon  thereafter.  The action
alleges the plaintiff  suffered certain losses and injuries as a result of using
the Company's  nasal spray product.  The complaint  consists of counts for fraud
and  deceit  (fraudulent  concealment),   negligent  misrepresentation,   strict
liability (failure to warn), and strict product liability (design defect).

A trial  date has  been set for  August  27,  2007.  The  Company  believes  the
plaintiff's claims are without merit and is vigorously defending this lawsuit.

At the present time this matter is being defended by the Company. Based upon the
information  the  Company has at this time,  it  believes  the action is without
merit. However, at this time no prediction as to the outcome can be made.

                    INNERLIGHT INC. VS. THE MATRIX GROUP, LLC
          (FOURTH JUDICIAL DISTRICT COURT, UTAH COUNTY, STATE OF UTAH)

On March 13, 2006  Innerlight  Inc. filed a declaratory  judgment  action in the
Fourth Judicial District,  Utah County, State of Utah,  requesting a declaration
that there is no valid contract  between the parties.  The Matrix Group, LLC has
alleged there is a contract  between the parties  obligating  Innerlight Inc. to
purchase  $750,000 of products for the 12-month  period  commencing  October 18,
2004 and ending October 17, 2005,  $1,500,000 for the period commencing  October
18, 2005 and ending October 17, 2006, and for each 12-month  period  thereafter,
through and including October 17, 2013, at least $4,000,000 of products from The
Matrix Group, LLC. The document on which Matrix relies was drafted by Matrix and
states that the acceptance of the appointment by distributor  (Innerlight  Inc.)
is conditioned upon  distributor's  written  acceptance of the Company's product
price list.  No written  acceptance  of the product  price list was ever made by
Innerlight Inc.

The  Matrix  Group,  LLC filed a Utah Rule of Civil  Procedure  12(b)(3)  motion
asking  that the  complaint  be  dismissed.  On July 13,  2006 the Court for the
Fourth Judicial District,  Utah County,  State of Utah, entered an order denying
defendant's  motion  to  dismiss  under  Rule  12(b)(3)  based  on  Innerlight's
assertion  that a  material  condition  precedent  remains  to be  satisfied  to
establish an enforceable  agreement  between the parties.  The Utah County Court
has maintained  jurisdiction of this action to make a final determination on the
merits of Innerlight's claim.

Thereafter,  Matrix filed a counterclaim  alleging that a contract did exist and
that  Innerlight  had breached this  contract.  Both parties then agreed to stay
discovery,  concluding  that  discovery was not necessary and both filed motions
for summary judgment to resolve the case.

On January 17, 2007, arguments were presented to the Court on the parties' cross
motions for summary judgment and the Court ruled in Innerlight's favor,  finding
that no contract existed between the parties and that Innerlight was entitled to
return over $150,000 in product to Matrix for reimbursement.  The wording of the
final Order granting  Innerlight's motion and rejecting Matrix's were entered by
the  Court on April  10,  2007.  Matrix  has the  right to  appeal.  Matrix  has
expressed its intent to appeal the Court's  summary  judgment ruling and related
rulings, and has filed a motion to stay enforcement of the Court's order pending
appeal,  and for an order excusing Matrix from the requirement of filing a bond.
Innerlight intends to oppose Matrix's motion and any appeal vigorously.

For the reasons  stated by the Court in the case, as well as for other  reasons,
the Company believes that plaintiffs'  case on appeal lacks merit;  however,  no
prediction as to the outcome of the appeal can be made.


                                      -12-


                          TERMINATED LEGAL PROCEEDINGS

          ZANG ANGELFIRE, TRACEY ARVIN, SHANE HOHNSTEIN, TAMMY LAURENT,
                BARBARA SEOANE, DONNA SMALLEY, AND JOHN WILLIAMS
                           VS. THE QUIGLEY CORPORATION
             (PA. C.C.P., BUCKS COUNTY, DOCKET NO. 2004-07364-27-2)

On November 4, 2004, the above plaintiffs filed an action in the Court of Common
Pleas of Bucks County  against the Company.  The  complaint was amended on March
11, 2005.  The action alleged that the  plaintiffs  suffered  certain losses and
injuries as a result of using the Company's nasal spray product.  The plaintiffs
claimed  the  Company  was  liable to them based on the  following  allegations:
negligence,  strict products  liability  (failure to warn and defective design),
breach of express warranty,  breach of implied warranty,  and a violation of the
Pennsylvania  Unfair  Trade  Practices  and  Consumer  Protection  Law and other
consumer protection statutes.

These  actions were recently  settled at the direction of the insurance  carrier
out of insurance proceeds.

         BRIGITTE YVON & KLAUS YVON VS. THE QUIGLEY CORPORATION, ET AL.

On October 12, 2005,  the  Plaintiffs  instituted  an action  against  Caribbean
Pacific Natural  Products,  Inc. and other defendants for personal injuries as a
result of being hit by a chair on the pool deck of Waikoloa Beach Marriott Hotel
d/b/a Outrigger Enterprises,  Inc. in Honolulu, Hawaii. On December 9, 2005, The
Quigley Corporation was added as an additional  defendant without notice to this
case. The main defendant in the case is Caribbean Pacific Natural Products, Inc.
in which The Quigley  Corporation  formerly held stock.  On January 22, 2003 all
shares of The Quigley Corporation stock were sold to Suncoast Naturals,  Inc. in
return for stock of Suncoast  Naturals,  Inc. At the time of the  accident,  The
Quigley  Corporation  had no  ownership  interest in Caribbean  Pacific  Natural
Products,  Inc.  On April 26,  2007,  counsel  for all  parties  entered  into a
stipulation  for  partial   dismissal  without  prejudice  against  The  Quigley
Corporation.

NOTE 7 - TRANSACTIONS AFFECTING STOCKHOLDERS' EQUITY

On  September 8, 1998,  the  Company's  Board of  Directors  declared a dividend
distribution  of Common  Stock  Purchase  Rights  (individually,  a "Right"  and
collectively,  the "Rights"),  thereby  creating a Stockholder  Rights Plan (the
"Plan"). The dividend was payable to the stockholders of record on September 25,
1998. Each Right entitles the stockholder of record to purchase from the Company
that number of common shares  having a combined  market value equal to two times
the Rights  exercise  price of $45.  The Rights  are not  exercisable  until the
distribution  date,  which will be the earlier of a public  announcement  that a
person or group of affiliated or associated  persons has acquired 15% or more of
the  outstanding  common  shares,  or  the  announcement  of an  intention  by a
similarly  constituted party to make a tender or exchange offer resulting in the
ownership of 15% or more of the outstanding  common shares. The dividend has the
effect of giving the  stockholder a 50% discount on the share's  current  market
value for  exercising  such  right.  In the event of a cashless  exercise of the
Right,  and the acquirer has acquired less than 50% beneficial  ownership of the
Company,  a  stockholder  may  exchange  one Right for one  common  share of the
Company. The final expiration date of the Plan is September 25, 2008.

Since the inception of the stock buy-back program in January 1998, the Board has
subsequently  increased  the  authorization  on  five  occasions,  for  a  total
authorized  buy-back of 5,000,000  shares or  approximately  38% of the previous
shares  outstanding.  Such shares are  reflected  as treasury  stock and will be
available for general corporate purposes.  From the initiation of the plan until
March 31, 2007,  4,159,191 shares have been repurchased at a cost of $24,042,801
or an average cost of $5.78 per share. No shares were repurchased during 2004 to
2007 to date.

During the three  months  ended  March 31,  2007,  no options or  warrants  were
granted or exercised.

NOTE 8 - INCOME TAXES

Certain  exercises  of options and  warrants,  and  restricted  stock issued for
services that became  unrestricted  resulted in  reductions  to taxes  currently
payable and a  corresponding  increase to  additional-paid-in-capital  for prior
years.  In  addition,  certain tax  benefits  for option and  warrant  exercises
totaling    $6,581,458    are    deferred    and    will    be    credited    to
additional-paid-in-capital  when the NOL's  attributable  to these exercises are
utilized.  As a result,  these NOL's will not be available to offset  income tax
expense. The net operating loss carry-forwards that currently  approximate $16.6
million for federal purposes will be expiring through 2026. Additionally,  there
are net operating loss  carry-forwards  of $16.9 million for state purposes that


                                      -13-


will be expiring  through 2016.  Until  sufficient  taxable income to offset the
temporary  timing  differences  attributable  to operations,  the tax deductions
attributable to option, warrant and stock activities and alternative minimum tax
credits of $110,270  are  assured,  a  valuation  allowance  equaling  the total
deferred tax asset is being provided.

NOTE 9 - EARNINGS PER SHARE

Basic loss per share  ("EPS")  excludes  dilution  and is  computed  by dividing
income  available to common  stockholders  by the  weighted - average  number of
common  shares  outstanding  for the period.  Diluted EPS reflects the potential
dilution that could occur if securities or other contracts to issue common stock
were  exercised  or  converted  into common stock or resulted in the issuance of
common  stock  that  shared in the  earnings  of the  entity.  Diluted  EPS also
utilizes the treasury  stock method which  prescribes a theoretical  buy-back of
shares from the  theoretical  proceeds of all options and  warrants  outstanding
during  the  period.  Since  there is a large  number of  options  and  warrants
outstanding,  fluctuations  in the  actual  market  price can have a variety  of
results for each period presented.

A  reconciliation  of the applicable  numerators and  denominators of the income
statement periods presented,  as reflects the results of continuing  operations,
is as follows (millions, except per share amounts):

                                     March 31, 2007                March 31, 2006
                           ----------------------------------------------------------
                            Net                           Net
                            Loss      Shares      EPS     Loss      Shares      EPS
                           ----------------------------------------------------------
      Basic EPS            ($ 1.9)     12.7   ($  0.15)  ($ 1.5)     11.7   ($  0.12)
      Dilutives:
      Options/Warrants        --        --                  --        --
                           ----------------------------------------------------------
      Diluted EPS          ($ 1.9)     12.7   ($  0.15)  ($ 1.5)     11.7   ($  0.12)
                           ==========================================================

Options and warrants  outstanding  at March 31, 2007 and 2006 were 3,597,000 and
4,593,750  respectively.  They were not included in the  computation  of diluted
earnings  for  the  periods  with  a  net  loss  because  the  effect  would  be
anti-dilutive.

NOTE 10 - RELATED PARTY TRANSACTIONS

The Company is in the process of acquiring licenses in certain countries through
related party entities whose  stockholders  include Mr. Gary Quigley, a relative
of the Company's Chief Executive Officer.  Fees amounting to $30,750 and $53,250
have been paid to a related  entity  during the three month  periods ended March
31, 2007 and 2006,  respectively.  This  expenditure  is used to assist with the
regulatory aspects of obtaining such licenses.

NOTE 11 - SEGMENT INFORMATION

The basis for presenting  segment  results  generally is consistent with overall
Company reporting.  The Company reports information about its operating segments
in  accordance  with  Financial  Accounting  Standard  Board  Statement No. 131,
"DISCLOSURE  ABOUT  SEGMENTS OF AN ENTERPRISE  AND RELATED  INFORMATION,"  which
establishes  standards for  reporting  information  about a company's  operating
segments. All consolidating items are included in Corporate & Other.

The Company divides its operations into four reportable segments as follows: The
Quigley  Corporation  (Cold-Remedy),  whose  main  product  is  Cold-Eeze(R),  a
proprietary zinc gluconate  glycine lozenge for the common cold;  Darius (Health
and  Wellness),  whose  business is the sale and direct  marketing of a range of
health and wellness products;  Quigley Manufacturing  (Contract  Manufacturing),
which is the production  facility for the Cold-Eeze(R)  lozenge product and also
performs contract manufacturing services for third party customers,  and Pharma,
(Ethical  Pharmaceutical),   currently  involved  in  research  and  development
activity to develop patent applications for potential pharmaceutical products.


                                      -14-



Financial information relating to 2007 and 2006 operations, by business segment,
follows:

      ---------------------------------------------------------------------------------------------------------------------------
      For the Three  Months Ended          Cold        Health and     Contract        Ethical       Corporate &
      March 31, 2007                      Remedy        Wellness    Manufacturing   Pharmaceutical     Other           Total
      ---------------------------------------------------------------------------------------------------------------------------
      Revenues
        Customers-domestic             $ 5,540,640    $ 1,937,854    $   609,311    $     --       $     --       $ 8,087,805
        Customers-international        $     --       $   990,071    $     --       $     --       $     --       $   990,071
        Inter-segment                  $     --       $     --       $ 1,183,350    $     --       $(1,183,350)   $     --
      Segment operating profit (loss)  $  (459,929)   $  (239,103)   $  (226,673)   $(1,254,869)   $    92,234    $(2,088,340)


      ---------------------------------------------------------------------------------------------------------------------------
      For the Three  Months Ended          Cold        Health and     Contract        Ethical       Corporate &
      March 31, 2006                      Remedy        Wellness    Manufacturing   Pharmaceutical     Other           Total
      ---------------------------------------------------------------------------------------------------------------------------
      Revenues
        Customers-domestic             $ 5,177,340    $ 3,416,889    $   523,892    $   --         $      --      $ 9,118,121
        Customers-international        $     --       $ 1,147,917    $     --       $   --         $      --      $ 1,147,917
        Inter-segment                  $     --       $     --       $ 1,593,128    $   --         $(1,593,128)   $     --
      Segment operating profit (loss)  $  (305,907)   $  (218,372)   $  (169,795)   $(876,961)     $   (41,590)   $(1,612,625)


                                                               -15-


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

FORWARD-LOOKING STATEMENTS

In addition to  historical  information,  this Report  contains  forward-looking
statements.  These  forward-looking  statements are subject to certain risks and
uncertainties  that could cause actual results to differ  materially  from those
reflected in these forward-looking  statements.  Factors that might cause such a
difference include,  but are not limited to, management of growth,  competition,
pricing  pressures  on the  Company's  products,  industry  growth  and  general
economic conditions.  Readers are cautioned not to place undue reliance on these
forward-looking  statements,  which reflect management's opinions only as of the
date hereof.  The Company undertakes no obligation to revise or publicly release
the results of any revision to these forward-looking statements.

CERTAIN RISK FACTORS

The Quigley  Corporation makes no representation that the United States Food and
Drug  Administration  ("FDA")  or any  other  regulatory  agency  will  grant an
Investigational  New  Drug  ("IND")  or take  any  other  action  to  allow  its
formulations  to  be  studied  or/and  for  any  granted  IND  to  be  marketed.
Furthermore,  no claim is made that potential medicine discussed herein is safe,
effective, or approved by the FDA. Additionally, data that demonstrates activity
or  effectiveness  in animals  or in vitro  tests do not  necessarily  mean such
formula test compound,  referenced herein,  will be effective in humans.  Safety
and  effectiveness  in humans will have to be  demonstrated by means of adequate
and well  controlled  clinical  studies before the clinical  significance of the
formula test compound is known. Readers should carefully review the risk factors
described  in other  sections  of the filing as well as in other  documents  the
Company  files from time to time with the  Securities  and  Exchange  Commission
("SEC").

OVERVIEW

The  Company,   headquartered   in  Doylestown,   Pennsylvania,   is  a  leading
manufacturer, marketer and distributor of a diversified range of homeopathic and
health products which comprise the Cold Remedy, Health and Wellness and Contract
Manufacturing  segments.  The  Company  is also  involved  in the  research  and
development  of  potential  prescription  products  that  comprise  the  Ethical
Pharmaceutical segment.

The  Company's  business  is the  manufacture  and  distribution  of cold remedy
products to the consumer through the over-the-counter  marketplace together with
the sale of proprietary  health and wellness products through its direct selling
subsidiary.  One of the  Company's  key  products in its Cold Remedy  segment is
Cold-Eeze(R),  a zinc  gluconate  glycine  product  proven  in two  double-blind
clinical studies to reduce the duration and severity of the common cold symptoms
by nearly half.  Cold-Eeze(R)  is now an established  product in the health care
and cold  remedy  market.  Effective  October  1,  2004,  the  Company  acquired
substantially all of the assets of JoEl, Inc., the previous  manufacturer of the
Cold-Eeze(R)  lozenge product.  This  manufacturing  entity,  now called Quigley
Manufacturing  Inc.  ("QMI"),  a wholly owned  subsidiary  of the Company,  will
continue to produce lozenge product along with performing such operational tasks
as warehousing and shipping the Company's  Cold-Eeze(R)  products.  In addition,
QMI  produces  a  variety  of hard and  organic  candy  for sale to third  party
customers  in addition  to  performing  contract  manufacturing  activities  for
non-related entities.

The Cold-Remedy  segment  reported an increase in net sales in the first quarter
of 2007 of $363,300 as compared to the same period in 2006.  Consumer purchasing
levels appear to be  comparable  between the  quarters,  however,  the increased
sales are the result of a shift in buying patters by our customers to adjust for
low inventory levels during 2007.

The  Contract  Manufacturing  segment  reported  an increase in net sales in the
first  quarter of 2007 of $85,419 as  compared to the 2006  comparative  period.
This  segment's  sales remained  comparable  between the periods,  however,  its
primary  function  is to support  the cold remedy  segment  through  production,
warehousing and distribution of the Cold-Eeze product.

Darius International Inc. ("Darius"),  the Health and Wellness segment, a wholly
owned  subsidiary  of the Company,  was formed in January 2000 to introduce  new
products  to the  marketplace  through  a  network  of  independent  distributor
representatives.  Darius  is  a  direct  selling  organization  specializing  in
proprietary health and wellness  products.  The formation of Darius has provided
diversification  to the Company in both the method of product  distribution  and
the broader range of products available to the marketplace, serving as a balance
to the seasonal  revenue cycles of the  Cold-Eeze(R)  branded  products.  In the
first  quarter  of 2007,  this  segment  reported  a  reduction  in net sales of
$1,636,881 compared to the same period in 2006. Sales in the 2007 period reflect
the continued reduction in active independent distributor  representatives.  The
performance  of  this  segment  may  also  be  negatively  affected  by  current
litigation  with the sponsor of the  segment's  product  line.  During the third


                                      -16-


quarter of 2006 the Company  implemented  a plan of  corrective  action for this
segment,  part of which was the  appointment  of a new  president  who has broad
experience in this industry.

In January 2001, the Company formed an Ethical Pharmaceutical  segment,  Quigley
Pharma  Inc.  ("Pharma"),  that is under the  direction  of its  Executive  Vice
President and Chairman of its Medical Advisory Committee.  Pharma was formed for
the  purpose of  developing  naturally  derived  prescription  drugs.  Pharma is
currently  undergoing  research  and  development  activity in  compliance  with
regulatory  requirements.  The Company is in the initial stages of what may be a
lengthy process to develop these patent  applications into commercial  products.
The  Company   continues  to  invest   significantly  in  ongoing  research  and
development  activities of this segment.  Such investment amounted to $1,254,869
in the first quarter 2007 compared to $876,961 in the 2006 comparative period.

Future revenues,  costs,  margins, and profits will continue to be influenced by
the Company's  ability to maintain its  manufacturing  availability and capacity
together with its marketing and  distribution  capabilities and the requirements
associated  with the  development of Pharma's  potential  prescription  drugs in
order to  continue  to  compete  on a  national  and  international  level.  The
continued  expansion of Darius is dependent  on the Company  retaining  existing
independent   distributor   representatives  and  recruiting  additional  active
representatives  both  internationally  and within the United States,  continued
conformity with government regulations, a reliable information technology system
capable of  supporting  continued  growth and  continued  reliable  sources  for
product and materials to satisfy consumer demand.

COLD-REMEDY PRODUCTS

In May 1992, the Company  entered into an exclusive  agreement for the worldwide
representation,  manufacturing  and  marketing of  Cold-Eeze(R)  products in the
United States. Cold-Eeze(R), a zinc gluconate glycine formulation (ZIGG(TM)), is
an over-the-counter consumer product used to reduce the duration and severity of
the common cold and is available in lozenge, sugar-free tablet and gum form. The
Company has substantiated the effectiveness of Cold-Eeze(R) through a variety of
studies.  A  randomized  double-blind  placebo-controlled  study,  conducted  at
Dartmouth College of Health Science, Hanover, New Hampshire,  concluded that the
lozenge  formulation  treatment,  initiated  within 48 hours of  symptom  onset,
resulted in a significant reduction in the total duration of the common cold.

On May 22, 1992,  "ZINC AND THE COMMON COLD, A CONTROLLED  CLINICAL  STUDY," was
published in England in the "Journal of International  Medical Research," Volume
20, Number 3, Pages 234-246. According to this publication,  (a) flavorings used
in  other  Zinc  lozenge  products  (citrate,   tartrate,   separate,   orotate,
picolinate,  mannitol or sorbitol)  render the Zinc inactive and  unavailable to
the patient's  nasal  passages,  mouth and throat where cold symptoms have to be
treated, (b) this patented formulation delivers  approximately 93% of the active
Zinc to the  mucosal  surfaces  and (c) the  patient  has the same  sequence  of
symptoms  as in the  absence  of  treatment  but goes  through  the phases at an
accelerated rate and with reduced symptom severity.

On July 15, 1996,  results of a new randomized  double-blind  placebo-controlled
study on the common cold, which commenced at the CLEVELAND CLINIC  FOUNDATION on
October 3, 1994, were published.  The study called "ZINC GLUCONATE  LOZENGES FOR
TREATING THE COMMON COLD" was  completed and published in the ANNALS OF INTERNAL
MEDICINE - VOL. 125 NO. 2. Using a 13.3mg  lozenge  (almost half the strength of
the  lozenge  used in the  Dartmouth  Study),  the  result  still  showed  a 42%
reduction in the duration of common cold symptoms.

In April 2002, the Company announced the statistical  results of a retrospective
clinical  adolescent  study at the Heritage School facility in Provo,  Utah that
suggests that  Cold-Eeze(R)  is also an effective means of preventing the common
cold and statistically (a) lessens the number of colds an individual suffers per
year,  reducing  the  median  from  1.5 to  zero  and  (b)  reduces  the  use of
antibiotics  for respiratory  illnesses from 39.3% to 3.0% when  Cold-Eeze(R) is
administered as a first line treatment approach to the common cold.

In April 2002,  the Company was  assigned a Patent  Application  which was filed
with the Patent Office of the United States  Commerce  Department for the use of
Cold-Eeze(R) as a prophylactic for cold prevention.  The new patent  application
follows the results of the adolescent study at the Heritage School facility.

In May  2003,  the  Company  announced  the  findings  of a  prospective  study,
conducted at the Heritage School facility in Provo, Utah, in which 178 children,
ages 12 to 18 years, were given Cold-Eeze(R)  lozenges both  symptomatically and
prophylactically  from  October 5, 2001 to May 30,  2002.  The study found a 54%
reduction in the most frequently observed cold duration.


                                      -17-


Those  subjects not receiving  treatment  most  frequently  experienced  symptom
duration  of 11  days  compared  with 5 days  when  Cold-Eeze(R)  lozenges  were
administered, a reduction of 6 days.

The business of the Company is subject to federal and state laws and regulations
adopted  for  the  health  and  safety  of  users  of  the  Company's  products.
Cold-Eeze(R)  is a homeopathic  remedy that is subject to regulations by various
federal,  state and local  agencies,  including  the United States Food and Drug
Administration ("FDA") and the Homeopathic Pharmacopoeia of the United States.

HEALTH AND WELLNESS

Darius,  through  Innerlight  Inc.,  its wholly  owned  subsidiary,  is a direct
selling company  specializing in the development and distribution of proprietary
health and wellness products,  including herbal vitamins and dietary supplements
for the human condition, primarily within the United States and since the second
quarter of 2003, internationally.

The continued  success of this segment is dependent,  among other things, on the
Company's ability:

                 o  To  maintain   existing   active   independent   distributor
                    representatives    and   recruit    additional    successful
                    independent distributor representatives.  Additionally,  the
                    loss of key high-level distributors or business contributors
                    as  a  result  of  business  disagreements,   litigation  or
                    otherwise   could   negatively   impact  future  growth  and
                    revenues;

                 o  To continue to develop and make  available new and desirable
                    products at an acceptable cost;

                 o  To maintain safe and reliable  multiple-location sources for
                    product and materials;

                 o  To  maintain a reliable  information  technology  system and
                    internet  capability.  The Company has expended  significant
                    resources  on  systems  enhancements  in the  past  and will
                    continue to do so to ensure prompt customer  response times,
                    business continuity and reliable reporting capabilities. Any
                    interruption  to computer  systems for an extended period of
                    time could be harmful to the business;

                 o  To execute conformity with various federal,  state and local
                    regulatory  agencies  both  within  the  United  States  and
                    abroad.   With  the   growth  of   international   business,
                    difficulties with foreign regulatory requirements could have
                    a  significant   negative  impact  on  future  growth.   Any
                    inquiries  from  government   authorities  relating  to  the
                    Company's  business and compliance with laws and regulations
                    could be harmful to the Company;

                 o  To compete with larger more mature  organizations  operating
                    within the same market and to remain competitive in terms of
                    product relevance and business opportunity;

                 o  To successfully implement methods for progressing the direct
                    selling philosophy internationally; and

                 o  To plan strategically for general economic conditions.

Any or all of the above risks could result in significant reductions in revenues
and profitability of the Health and Wellness segment.

CONTRACT MANUFACTURING

From October 1, 2004, this manufacturing  entity, now called QMI, a wholly owned
subsidiary of the Company,  has continued to produce  lozenge product along with
performing  such  operational  tasks as  warehousing  and shipping the Company's
Cold-Eeze(R)  products. In addition to that function,  QMI produces a variety of
hard and  organic  candy  for sale to  third  party  customers  in  addition  to
performing contract manufacturing activities for non-related entities. QMI is an
FDA-approved facility.


                                      -18-


ETHICAL PHARMACEUTICAL

Pharma's current  activity is the research and development of  naturally-derived
prescription  drugs with the goal of improving the quality of life and health of
those  in need.  Research  and  development  will  focus on the  identification,
isolation and direct use of active medicinal substances.  One aspect of Pharma's
research will focus on the potential  synergistic benefits of combining isolated
active constituents and whole plant components.  The Company will search for new
natural  sources of medicinal  substances  from plants and fungi from around the
world while also  investigating  the use of traditional and historic  medicinals
and therapeutics.

The  pre-clinical  development,   clinical  trials,  product  manufacturing  and
marketing  of Pharma's  potential  new products are subject to federal and state
regulation in the United States and other  countries.  Obtaining FDA  regulatory
approval for these pharmaceutical products can require substantial resources and
take several years.  The length of this process depends on the type,  complexity
and novelty of the product and the nature of the disease or other indications to
be  treated.  If the  Company  cannot  obtain  regulatory  approval of these new
products in a timely  manner or if the patents are not granted or if the patents
are subsequently challenged,  these possible events could have a material effect
on the business  and  financial  condition  of the Company.  The strength of the
Company's patent position may be important to its long-term  success.  There can
be no assurance  that these  patents and patent  applications  will  effectively
protect the Company's products from duplication by others.

Patents and certain areas of focus are:

                 o  A Patent (No. 6,555,573 B2) entitled "Method and Composition
                    for the  Topical  Treatment  of  Diabetic  Neuropathy."  The
                    patent extends through March 27, 2021.

                 o  A Patent (No. 6,592,896 B2) entitled "Medicinal  Composition
                    and Method of Using It" (for  Treatment  of  Sialorrhea  and
                    other  Disorders)  for  a  product  to  relieve   sialorrhea
                    (drooling) in patients  suffering from  Amyotrophic  Lateral
                    Sclerosis  (ALS),  otherwise known as Lou Gehrig's  Disease.
                    The patent extends through August 5, 2021.

                 o  A Patent (No. 6,596,313 B2) entitled "Nutritional Supplement
                    and Method of Using It" for a product to relieve  sialorrhea
                    (drooling) in patients  suffering from  Amyotrophic  Lateral
                    Sclerosis  (ALS),  otherwise known as Lou Gehrig's  Disease.
                    The patent extends through April 14, 2022.

                 o  A Patent (No. 6,753,325 B2) entitled "Composition and Method
                    for   Prevention,   Reduction  and  Treatment  of  Radiation
                    Dermatitis,"  a  composition  for  preventing,  reducing  or
                    treating  radiation  dermatitis.  The patent extends through
                    November 5, 2021.

                 o  A  Patent   (No.   6,827,945   B2)   entitled   "Nutritional
                    Supplements  and  Method  of Using  Same"  for a method  for
                    treating  at least one  symptom  of  arthritis.  The  patent
                    extends through April 22, 2023.

                 o  A  Patent  (No.  7,083,813  B2)  entitled  "Methods  for The
                    Treatment of Peripheral  Neural and Vascular  Ailments." The
                    patent extends through August 4, 2023.

                 o  A Patent  (No.  7,166,435  B2)  entitled  "Compositions  and
                    Methods for Reducing the  Tranmissivity  of Illnesses." This
                    patent will  provide  additional  protection  to an existing
                    composition  patent  (number  6,592,896),  which the Company
                    received   in  July   2003   and   will   support   on-going
                    investigations      and     potential      commercialization
                    opportunities. The Company will be continuing its studies to
                    test the effects of the  referenced  compound  against avian
                    flu and human influenza. The patent extends through November
                    5, 2021.

                 o  A Patent  (No.  7,175,987  B2)  entitled  "Compositions  and
                    Methods for The  Treatment  of Herpes."  The patent  extends
                    through November 5, 2021.

                 o  A  Mexican  Patent  (No.   236311)   entitled   "Method  and
                    Composition for the Treatment of Diabetic  Neuropathy."  The
                    patent extends through December 18, 2020.

                 o  A New Zealand Patent (No. 533439) entitled  "Methods for The
                    Treatment of Peripheral  Neural and Vascular  Ailments." The
                    patent extends through November 6, 2022.

                 o  A New  Zealand  Patent  (No.  526041)  entitled  "Method and
                    Composition for the Treatment of Diabetic  Neuropathy."  The
                    patent extends through December 18, 2021.

                 o  A  New  Zealand  Patent  (No.  532775)   entitled   "Topical
                    Compositions and Methods for Treatment of Adverse Effects of
                    Ionizing  Radiation." The patent extends through November 6,
                    2022.


                                      -19-


                 o  An Australian Patent (No.  2002231095)  entitled "Method and
                    Composition for the Treatment of Diabetic  Neuropathy."  The
                    patent extends through December 18, 2021.

                 o  A South African Patent (No. 2003/4247) entitled "Methods and
                    Composition for the Treatment of Diabetic  Neuropathy."  The
                    patent extends through December 18, 2021.

                 o  A South African Patent (No. 2003/9802) entitled "Nutritional
                    Supplements  and  Methods  of Using  Same" for a method  for
                    treating  at least one  symptom  of  arthritis.  The  patent
                    extends through August 5, 2022.

                 o  A South African Patent (No. 2004/4614) entitled "Methods for
                    The Treatment of Peripheral  Neural and Vascular  Ailments."
                    The patent extends through November 5, 2022.

                 o  A   South   African   Patent   (No.    2005/0517)   entitled
                    "Anti-Microbial  Compositions & Methods for Using Same," the
                    patent extends through July 23, 2023.

                 o  A South African Patent (No. 2004/3365) "Topical Compositions
                    and Methods  for  Treatment  of Adverse  Effects of Ionizing
                    Radiation," the patent extends through November 5, 2022.

                 o  An  Israeli  Patent  (No.  159357)   entitled   "Nutritional
                    Supplements  and Methods of Using Same," the patent  extends
                    through August 6, 2022.

QR-333 - In April 2002, the Company  initiated a Phase II Proof of Concept Study
in France for treatment of diabetic neuropathy,  which was concluded in 2003. In
April 2003, the Company  announced that an independently  monitored  analysis of
the  Phase II  Proof  of  Concept  Study  concluded  that  subjects  using  this
formulation had 67% of their symptoms  improve,  suggesting  efficacy.  In March
2004,  the Company  announced that it had completed its first meeting at the FDA
prior to submitting the Company's IND  application for the relief of symptoms of
diabetic symmetrical peripheral  neuropathy.  The FDA's pre-IND meeting programs
are  designed  to  provide  sponsors  with  advance  guidance  and input on drug
development   programs.   In  September  2005,  the  Company  announced  that  a
preliminary  report  of its  topical  compound  for the  treatment  of  diabetic
neuropathy   was   recently   featured  in  the  JOURNAL  OF  DIABETES  AND  ITS
COMPLICATION.  Authored  by Dr. C.  LeFante  and Dr.  P.  Valensi,  the  article
appeared  in the June 1, 2005  issue,  and  included  findings  that  showed the
compound reduced the severity of numbness,  and irritation from baseline values.
In October 2005, the Company  announced the results of  pre-clinical  toxicology
studies that showed no irritation,  photo toxicity,  contact hypersensitivity or
photo allergy when applied  topically to hairless  guinea pigs and another study
that showed no difference in the dermal response of the compound or placebo when
applied  to  Gottingen  Minipigs.  (Both  animal  models are  suggested  for the
evaluation of topical drugs,  by the FDA). In March 2006, the Company  announced
the filing of an IND application  with the FDA for its topical  compound for the
treatment of Diabetic Peripheral Neuropathy.  This filing allowed the Company to
begin human  clinical  trials  following a 30-day review  period.  If no further
comments  were  forthcoming  from the FDA,  studies  with human  subjects  could
commence  pending the  availability of study drug. This  application  included a
compilation   of  all  of  the  supporting   development   data  and  regulatory
documentation  required to file an IND application  with the FDA. In April 2006,
upon FDA  approval  for its IND,  the Company  announced  its intent to commence
human studies on its formulation.

The Company also  announced that in  anticipation  of receiving this IND, it had
previously held its  investigators  meeting to organize its  multi-center  phase
2(b) trials. This would allow the Company to begin these trials as soon as study
drug is available.

In May 2006, the Company announced that it had begun screening patients to start
testing  their  investigational  new drug  QR-333 and  patients  suffering  from
diabetic peripheral  neuropathy would be given doses in an escalating fashion to
provide pharmacokinetics data.

In September 2006, the Company  announced that the results from its human study,
titled   "Single   Center,   Dose   Escalating,    Safety,   Tolerability,   And
Pharmacokinetics   Study  Of  QR-333  In  Subjects  With   Diabetic   Peripheral
Neuropathy",  demonstrated  that QR-333 can be  administered  safely to patients
suffering from diabetic peripheral neuropathy and it would proceed to conducting
Phase IIb clinical  trials.  The  essential  CMC  (Chemistry  Manufacturing  and
Controls) stage would provide the Company with the necessary  information needed
to  produce  larger  quantities  of  drug  for the  Phase  IIb  trial  involving
approximately 180 patients.

The  pharmacokinetics  trial was the first study in the U.S. conducted under the
FDA  issued  IND.  The  positive  data  showed  that  QR-333 is safe,  it is not
systemically  absorbed and it is well  tolerated  after  multiple  doses.  These
findings are consistent  with prior animal  toxicity data and the human proof of
concept study performed in France.


                                      -20-


In November 2006, the Company  announced that patient  enrollment in a Phase IIb
multi center clinical study of QR-333 for the treatment of symptomatic  Diabetic
Peripheral Neuropathy (DPN) had commenced. The Phase IIb trial will evaluate the
safety  and  efficacy  of  QR-333   applied   three  times  daily   compared  to
placebo-treated  patients over 12 weeks.  Efficacy will be determined by Symptom
Assessment  Scores,  a Visual  Analogy  Scale  (VAS),  Quality of Life and Sleep
Questionnaires.   Safety  will  be  determined  by  medical  history,   physical
examination,  vital signs,  12-lead ECG,  laboratory  tests and nerve conduction
studies. The study will involve 150-180 randomized male and female patients with
Type 1 & 2 diabetes,  as defined by the ADA (American Diabetes  Association) and
distal symmetric diabetic polyneuropathy.

The Study  Chairman is Dr. Philip  Raskin,  Professor of Medicine  University of
Texas  Southwestern  Medical  Center at Dallas  Texas.  The study  protocol  was
approved by the FDA as a part of Quigley  Pharma's IND  submission  and has been
approved by the required  Investigational  Review Boards.  The completion of the
study is dependent upon  enrollment  rates that may affect the overall length of
the study and the communication of its results.

QR-336 - In April 2004,  the  Company  announced  the results of a  preliminary,
pre-clinical  animal study which measured the effect of its  proprietary  patent
applied  for  formulation  against  ionizing  (nuclear)  radiation.  This  study
determined that parenteral (injection)  administration of the study compound was
protective  against the effects of a lethal,  whole body ionizing radiation dose
in a mouse model. This compound is being  investigated to potentially reduce the
effects of radiation exposure on humans.

In April  2006,  the  Company  announced  that it signed an  agreement  with Dr.
William H. McBride,  the Vice Chair of Research,  Department of Oncology at UCLA
to help develop an appropriate  animal model radio  protective  research program
for QR-336 to comply with New Food and Drug Administration animal efficacy rules
for radio-protective pharmacological compounds.

In October 2006,  the Company  announced that it had received  significant  data
identifying  50  microliters  as the least  toxic and most  effective  radiation
protection dose in mice when administered ip (intraperitoneal), po (by mouth) or
sc  (under  the  skin)  prior to  radiation  exposure.  These  experiments  were
essential for providing  the Company with data to optimize the  formulation  for
efficacy  and route of  administration,  which is required  for filing under the
FDA's "Animal Efficacy Rule".

QR-337 - In September  2003,  the Company  announced  its  intention to file for
permission  to study its patent  pending  potential  treatment for psoriasis and
other skin  disorders.  Continued  testing will  therefore  have to be conducted
under an IND application following positive preliminary results.

QR-435 - In May 2004, the Company announced that an intranasal spray application
of the anti-viral test compound demonstrated efficacy by significantly  reducing
the severity of illness in ferrets that had been  infected  with the Influenza A
virus. In pre-clinical studies, the antiviral formulation demonstrates antiviral
activity  against  Ocular and Genital  Herpes,  indicating  a new  research  and
development  path for the  versatile  compound.  The Company is pleased with the
progress  and  indicated  that  continued  research  is  required to confirm the
compound's safety and efficacy profiles.

In May 2006,  the Company  announced  that it would begin a series of studies to
evaluate the ocular  antiviral  efficacy  and toxicity of its  naturally-derived
topical  compound QR-435.  Studies will be completed at The Campbell  Ophthalmic
Microbiology  Laboratory  at the  University of Pittsburgh in the same lab where
previous successful in vitro studies of QR-435 were performed.

In December 2006, the Company  announced that a series of studies were conducted
on the advice of Campbell  Laboratories,  University  of  Pittsburgh,  to assess
QR-435  (Quigley  Pharma's  broad  spectrum  anti-viral)  potential for treating
Herpes Keratitis. While the in-vitro studies were very successful at killing the
herpes virus on direct  contact,  the  HSV-1/NZW  rabbit  keratitis  model study
showed that the compound,  in its aqueous  form,  did not remain in the eye long
enough to penetrate the corneal  epithelial  cells where the virus resides in an
infection.  The HSV-1/NZW  rabbit  keratitis model is a recognized  standard for
evaluating potential therapeutic agents in this class and is only utilized based
on prior positive experimentation, as was the case.

Quigley  Pharma may continue to pursue  research and  development  objectives of
this compound in the treatment of  respiratory  viruses on the strength of prior
successful  in-vitro and ferret model in-vivo studies.  The company's  naturally
derived  formula has shown  significant  antiviral  properties  against  various
strains of H3N2 and H5N1 Influenza viruses in these studies.

QR-437 - In January 2004,  the Company  reported  that its  compound,  which was
demonstrating  antiviral  activity,  had shown virucidal and virustatic activity
against the strain 3B of the Human  Immunodeficiency  Virus Type 1 (HIV-1) in an
in-vitro study.  Additionally,  the Company decided that the derivative compound
of the  anti-viral  formulation  previously  found to be effective  for treating
Sialorrhea  would  probably  postpone  further  development  on  the  Sialorrhea
indication  and  concentrate  on further  qualification  and  development of the
anti-viral capabilities of the compound in humans.


                                      -21-


QR-439 - In December  2003,  the Company  announced  positive  test results of a
preliminary  independent in vitro study  indicating  that a test compound of the
Company previously tested on the Influenza virus showed  "significant  virucidal
activity  against a strain  of the  Severe  Acute  Respiratory  Syndrome  (SARS)
virus."

In January 2004, the Company announced that it would conduct two further studies
evaluating the compound which had shown activity against Influenza and SARS. The
first  study was  intended to repeat the  previously  announced  results,  which
demonstrated the compound to be 100 percent effective in preventing non-infected
ferrets in close proximity to an infected ferret from becoming infected with the
Influenza  A  virus.  The  second  study  was a dose  ranging  study on the test
compound.   Upon  dosage  determination  and  confirmation  results  from  these
forthcoming  animal model studies,  a human proof of concept study using a virus
challenge  with  Influenza A virus in a  quarantine  unit would be a viable next
step.

QR-440 (a) - The Company received an additional  Investigational New Animal Drug
(INAD)  number from the Center for  Veterinary  Medicine of the FDA. In previous
studies, QR-440 has been shown to reduce inflammation and also suggests possible
disease-modifying potential.

QR-441(a) - In November  2005,  the Company was assigned  nine INADs for a broad
anti-viral agent by the Center for Veterinary  Medicine of the FDA. Eight of the
INADs are for  investigating  the  compound use against  avian flu  H5N1virus in
chickens,  turkeys,  ducks,  pigs,  horses,  dogs,  cats and non-food  birds. In
January  2006,  a ninth INAD was  assigned  for  investigating  its compound for
treating  arthritis in dogs.  In March 2006,  the Company  announced  that it is
planning a series of  controlled  experiments  designed  to test its all natural
broad spectrum anti-viral compound in poultry stocks. The Company also announced
that Dr. Timothy S. Cummings,  MS, DVM, ACPV Clinical  Poultry  Professor at the
College of Veterinary  Medicine at  Mississippi  State  University and Thomas G.
Voss, Ph.D.  Assistant  Professor Tulane  University  School of Medicine will be
assisting the Company in the development of the INAD bird challenge studies.

In July 2006, the Company  announced that it has obtained  positive results that
support  Quigley  Pharma's  continued  progress in developing  the natural broad
spectrum  anti-viral  QR441(a) for use in preventing  the spread of avian flu in
poultry stocks.  The results of the healthy chicken medical feed study confirmed
that  food  or  water  dose  forms   provide  an   opportunity   for   potential
commercialization if the compound demonstrates efficacy within these dose forms.
The  results  clearly  showed  that the  chickens  tolerated  and  consumed  all
concentrations  of QR441 (a) in the  medicated  feed.  They also  tolerated  and
consumed the low concentration of drug in the medicated water.

In January 2007, the Company announced  positive results from a study evaluating
its  anti-viral  compound  QR-441(a) in  embryonating  egg and VERO E6 cell test
models.  The preliminary study demonstrated  QR-441(a) as a potential  antiviral
agent in  reducing  Infectious  Bronchitis  and New  Castle  Disease,  two viral
poultry diseases that have a significant economic impact to the poultry industry
on an annual basis.  Previous in vitro studies have  demonstrated that QR-441(a)
to be a potent antiviral agent against H5N1 (Avian Flu).

In February 2007, the Company announced that it had signed an agreement with the
State of Israel  Ministry  of  Agriculture  & Rural  Development  (MOAG) and the
Kimron  Veterinary  Institute to conduct a clinical trial testing the anti-viral
capacity of the Quigley  compound  QR-441(a)  administered as a medical feed and
water to chickens exposed to HPAI (Highly Pathogenic Avian Influenza) H5N1.

If  successful  this study could  potentially  provide  data on the  efficacy of
QR-441(a) in preventing  the infection of food grade poultry  through the use of
formulated  feed  and  water.  Positive  data  could  be  used to  continue  the
development  of the  compound  in the U.S with  guidance  from the FDA under the
INAD's  issued to  Quigley  in 2005 and might  also be  useful  for  development
outside the United States, where the impact of disease has already been felt.

QR-443 - In August 2006,  the Company  announced  that it had obtained  positive
results for its QR-443  compound for the  treatment of Cachexia.  Cachexia is an
extremely  debilitating and life threatening,  wasting syndrome  associated with
chronic  diseases  such  as  cancer,  AIDS,  chronic  renal  failure,  COPD  and
rheumatoid  arthritis,  where inflammation has a significant impact and patients
experience  loss of weight,  muscle  atrophy,  fatigue,  weakness and  decreased
appetite.  The  results  of an animal  study  found a 75%  efficacy  rate in the
treatment of mice with this condition.

In January  2007,  the Company  announced  that it had  completed a  preliminary
follow up  Cachexia  study,  evaluating  weight loss in mice.  The tumor  burden
Cachexia  model study  concluded  that QR-443 was as  effective  in delaying the
progression  of  Cachexia  when  given  orally  as it had been  shown to be when
administered intra-peritoneally in a previous study.

The new data compliments the previous study results  demonstrating a correlation
between  effectiveness  and  the  frequency  of  administration  of  the  QR-443
compound.


                                      -22-


RECENTLY ISSUED ACCOUNTING STANDARDS

In February 2007, the Financial  Accounting Standards Board ("FASB") issued SFAS
No. 159, The Fair Value Option for Financial Assets and Financial  Liabilities -
Including  an  amendment  of FASB No. 115 ("FAS  159").  The  Statement  permits
companies  to choose to measure many  financial  instruments  and certain  other
items at fair value in order to mitigate  volatility in reported earnings caused
by measuring related assets and liabilities  differently without having to apply
complex  hedge  accounting  provisions.  FAS 159 is  effective  for the  Company
beginning  January 1, 2008. The Company is currently  evaluating the impact,  if
any, of FAS 159 on its operating results and financial position.

CRITICAL ACCOUNTING ESTIMATES

The preparation of financial statements in conformity with accounting principles
generally  accepted in the United States  requires  management to make estimates
and assumptions  that affect the reported  amounts of assets and liabilities and
disclosure of contingent  liabilities  at the dates of the financial  statements
and the reported amounts of revenues and expenses during the reporting  periods.
Actual results could differ from those estimates.

The Company is organized into four different but related business segments, Cold
Remedy, Health and Wellness,  Contract Manufacturing and Ethical Pharmaceutical.
When providing for the appropriate sales returns, allowances, cash discounts and
cooperative  incentive  promotion  costs,  each  segment  applies a uniform  and
consistent method for making certain assumptions for estimating these provisions
that are applicable to that specific  segment.  Traditionally,  these provisions
are  not  material  to net  income  in the  Health  and  Wellness  and  Contract
Manufacturing  segments.  The Ethical  Pharmaceutical  segment does not have any
revenues.

The product in the Cold Remedy segment, Cold-Eeze(R), has been clinically proven
in two  double-blind  studies to reduce the severity and duration of common cold
symptoms.  Accordingly,  factors  considered in estimating the appropriate sales
returns and allowances for this product  include it being: a unique product with
limited competitors;  competitively priced;  promoted;  unaffected for remaining
shelf life as there is no expiration  date;  monitored  for inventory  levels at
major customers and third-party  consumption data, such as Information Resources
Incorporated ("IRI").

At March 31, 2007 and December  31, 2006,  the Company  included  reductions  to
accounts  receivable  for sales returns and allowances of $438,000 and $534,000,
respectively,  and  cash  discounts  of  $88,000  and  $154,000,   respectively.
Additionally,  current  liabilities  at March 31,  2007 and  December  31,  2006
include $694,745 and $861,186, respectively, for cooperative incentive promotion
costs.

Management  believes there are no material  charges to net income in the current
period related to sales from a prior period.

REVENUE

Provisions to reserves to reduce  revenues for cold remedy  products that do not
have an  expiration  date,  include the use of  estimates,  which are applied or
matched to the current sales for the period presented. These estimates are based
on specific customer tracking and an overall historical  experience to obtain an
effective  applicable  rate,  which is tested on an  annual  basis and  reviewed
quarterly to ascertain the most  applicable  effective rate.  Additionally,  the
monitoring of current occurrences,  developments by customer,  market conditions
and any other occurrences that could affect the expected  provisions relative to
net sales for the period presented are also performed.

A one percent deviation for these consolidated  reserve provisions for the three
month  periods  ended  March  31,  2007,  and 2006  would  affect  net  sales by
approximately $104,000 and $117,000,  respectively.  A one percent deviation for
cooperative  incentive promotions reserve provisions for the three month periods
ended March 31, 2007 and 2006 would  affect net sales by  approximately  $66,000
and $62,000, respectively.

The reported  results  include a remaining  returns  provision of  approximately
$112,000 and $113,000 at March 31, 2007 and December 31, 2006, respectively,  in
the  event of  future  product  returns  following  the  discontinuation  of the
Cold-Eeze(R) Cold Remedy Nasal Spray product in September 2004.


                                      -23-


INCOME TAXES

The Company has  recorded a valuation  allowance  against its net  deferred  tax
assets.  Management  believes  that  this  allowance  is  required  due  to  the
uncertainty  of  realizing  these tax  benefits in the future.  The  uncertainty
arises because the Company may incur substantial  research and development costs
in its Ethical Pharmaceutical segment.

THREE MONTHS ENDED MARCH 31, 2007 COMPARED WITH THREE MONTHS ENDED MARCH 31, 2006

Net sales for the three  month  period  ended  March 31,  2007 were  $9,077,876,
reflecting a decrease of $1,188,162  over the net sales of  $10,266,038  for the
comparable  three month  period ended March 31,  2006.  The Cold Remedy  segment
reported net sales in the 2007 period of $5,540,640, an increase of $363,300, or
7.0%,  over the comparable  2006 period of  $5,177,340.  The Health and Wellness
segment  reported  net sales in the 2007  period of  $2,927,925,  a decrease  of
$1,636,881,  or 35.9%,  over the net sales of $4,564,806 for the comparable 2006
period. The Contract Manufacturing segment reported net sales of $609,311 in the
2007 period compared to $523,892 in the comparable  2006 period,  an increase of
$85,419 or 16.3%.

The increase in cold remedy sales in the 2007 period is the result of a shift in
buying  patterns by our customers to increase their low inventory  levels in the
2007 quarter. Customer inventory levels were high in the 2006 period as a result
of unusually warm weather and a lower incidence of upper  respiratory  ailments.
The 2007 cold  season was  extended  as a result of  unseasonably  cold  weather
during  the  early  part of 2007  also  resulting  in  increased  sales for this
segment.

The Health and Wellness  segment's  net sales  decreased in the 2006 period as a
result  of  the  continued   reduction  in  the  number  of  active  independent
distributor representatives.  Management has implemented corrective action which
included  the  appointment  of a new  president  of this  segment  who has broad
experience in this industry.

Net sales of the Contract  Manufacturing  segment  reported a small  increase in
2007.  The  primary  purpose  of  the  Contract   Manufacturing  segment  is  to
manufacture, warehouse and distribute COLD-EEZE(R), other contract manufacturing
is  performed  for  non-related  third  party  entities  to  compensate  for the
necessary fixed costs associated with this segment.

Cost of sales as a percentage  of net sales for the three months ended March 31,
2007 was 44.8% compared to 48.3% for the comparable  2006 period,  a decrease of
3.5%.  The Cold  Remedy  segment's  cost of sales in the 2007  period  was 34.4%
compared to 32.3% in the 2006 comparable  period,  an increase of 2.1%,  largely
due to increased  freight costs and variations in product mix. The cost of sales
for the Health and Wellness  segment  decreased  by 2.8% between  periods due to
decreased independent distributor representatives commission expense, along with
increased  product and freight costs. The Contract  Manufacturing  segment had a
negative impact to cost of sales overall which is a factor of production  volume
and fixed costs. On  consolidation  the cost of sales was favorably  affected by
the change in mix of sales between segments having different costs.

Sales and marketing expense for the three month period ended March 31, 2007 were
$2,733,543,  an increase of $298,618 over the  comparable  2006 period amount of
$2,434,925.  The  increase was  primarily  due to  increased  media  advertising
expense in 2007 of $544,138  mitigated  by reduced  product  promotion  costs of
$179,694.

General and administration costs for the three month period ended March 31, 2007
was  $3,212,155  compared  to  $3,705,761  for the 2006  period,  a decrease  of
$493,606  between  the  periods.  The  decrease  in 2007  was  primarily  due to
decreased legal and insurance costs of $302,674 and $99,244, respectively.

Research and development costs during the three months ended March 31, 2007 were
$1,152,662 compared to $784,523 during the 2006 comparable period, reflecting an
increase in 2007 of $368,139,  primarily as a result of increased Pharma segment
costs.

LIQUIDITY AND CAPITAL RESOURCES

The Company had working capital of $18,736,968 and $20,541,273 at March 31, 2007
and December 31, 2006,  respectively.  Changes in working  capital  overall have
been  primarily  due  to  the  following  items:  cash  balances   increased  by
$1,419,153;  account  receivable  balances,  net, decreased by $3,811,417 due to
seasonal  factors and effective  collection  practices;  inventory  decreased by
$98,548  primarily  due to a slow down in sales  activity;  accrued  advertising
decreased by $1,442,232 due to the seasonal nature of the  Cold-Remedy  segment,
accrued royalties and sales commissions increased by $225,755 largely due to the
effects of certain litigation in progress. Total cash balances at March 31, 2007
were $19,175,912 compared to $17,756,759 at December 31, 2006.


                                      -24-


Management believes that its strategy to establish  Cold-Eeze(R) as a recognized
brand name, its broader range of products, its diversified  distribution methods
as  it  relates  to  the  Health  and  Wellness   business   segment,   adequate
manufacturing  capacity,  and growth in international  sales,  together with its
current  working  capital,  should provide an internal source of capital to fund
the Company's business  operations.  Generally,  profitable  operations from the
Cold Remedy and Health and  Wellness  segments  contribute  current  expenditure
support in  relation  to the  Ethical  Pharmaceutical  segment.  In  addition to
anticipated funding from operations, the Company and its subsidiaries may in the
short and long term raise capital  through the issuance of equity  securities to
finance anticipated growth.

Management is not aware of any trends,  events or uncertainties that have or are
reasonably  likely to have a material  negative  impact upon the  Company's  (a)
short-term or long-term  liquidity,  or (b) net sales or income from  continuing
operations.  Any challenge to the Company's  patent rights could have a material
adverse effect on future liquidity of the Company;  however,  the Company is not
aware of any condition that would make such an event probable.

Management believes that cash generated from operations,  along with its current
cash  balances,  will be  sufficient  to finance  working  capital  and  capital
expenditure requirements for at least the next twelve months.

CAPITAL EXPENDITURES

Capital  expenditures  during  the  remainder  of 2007  are not  expected  to be
material.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Company's  operations are not subject to risks of material  foreign currency
fluctuations, nor does it use derivative financial instruments in its investment
practices.  The Company  places its marketable  investments in instruments  that
meet high credit quality standards.  The Company does not expect material losses
with respect to its investment  portfolio or exposure to market risks associated
with interest  rates.  The impact on the Company's  results of a one  percentage
point change in short-term  interest  rates would not have a material  impact on
the Company's future earnings,  fair value, or cash flows related to investments
in cash equivalents or interest-earning marketable securities.

ITEM 4. CONTROLS AND PROCEDURES

Based on their  evaluation  as of the end of the period  covered by this report,
the Company's Chief Executive Officer and Chief Financial Officer have concluded
that the  Company's  disclosure  controls  and  procedures  (as defined in Rules
13a-15 and 15d-15 under the  Securities  Exchange  Act of 1934,  as amended) are
effective.  There have been no  significant  changes in internal  controls or in
other factors that could  significantly  affect these controls subsequent to the
date of their  evaluation,  including  any  corrective  actions  with  regard to
significant  deficiencies  and  material  weaknesses.  The Company was deemed an
"accelerated  filer"  as such  term is  defined  pursuant  to Rule  12b-2 of the
Securities  Exchange  Act of 1934,  as amended,  as of the end of the  Company's
fiscal year ended December 31, 2006. As an "accelerated  filer", the Company was
required by the Sarbanes-Oxley Act of 2002, as amended, to include an assessment
of its  internal  control  over  financial  reporting  and  attestation  from an
independent  registered public accounting firm in its Annual Report on Form 10-K
commencing  with the fiscal  year ended  December  31,  2006.  The  Company  has
undergone a comprehensive  effort in preparation for compliance with Section 404
of the Sarbanes-Oxley Act of 2002. This has involved the documentation,  testing
and review of our internal controls under the direction of senior management.


                                      -25-


                           PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

              TESAURO AND ELEY, ET AL. VS. THE QUIGLEY CORPORATION
                  (CCP OF PHILA., AUGUST TERM 2000, NO. 001011)

In September,  2000, the Company was sued by two individuals  (Jason Tesauro and
Elizabeth Eley, both residents of Georgia), allegedly on behalf of a "nationwide
class" of  "similarly  situated  individuals,"  in the Court of Common  Pleas of
Philadelphia  County,  Pennsylvania.  The  Complaint  further  alleges  that the
plaintiffs  purchased  certain  Cold-Eeze  products  between  August,  1996, and
November, 1999, based upon cable television,  radio and internet advertisements,
which  allegedly  misrepresented  the  qualities  and benefits of the  Company's
products. The Complaint, as pleaded originally,  requested an unspecified amount
of damages for violations of Pennsylvania's  consumer  protection law, breach of
implied warranty of merchantability and unjust enrichment, as well as a judicial
determination that the action be maintained as a class action. In October, 2000,
the Company filed  Preliminary  Objections to the Complaint seeking dismissal of
the  action.   The  court  sustained  certain   objections,   thereby  narrowing
plaintiffs' claims.

In May 2001,  plaintiffs  filed a motion to  certify  the  putative  class.  The
Company  opposed  the motion.  In  November,  2001,  the court held a hearing on
plaintiffs' motion for class certification.  In January,  2002, the court denied
in part and granted in part  plaintiffs'  motion.  The court denied  plaintiffs'
motion to  certify a class  based on  plaintiffs'  claims  under  Pennsylvania's
consumer   protection  law,  under  which  plaintiffs   sought  treble  damages,
effectively  dismissing  this cause of action;  however,  the court  certified a
class  based on  plaintiffs'  secondary  breach of implied  warranty  and unjust
enrichment claims. In August, 2002, the court issued an order adopting a form of
Notice of Class Action to be published  nationally.  The form of Notice approved
by the court included a provision  which limits the potential  class members who
may  potentially  recover  damages in this action to those persons who present a
proof of purchase of Cold-Eeze during the period August 1996 and November 1999.

Afterward,  a series of pre-trial  motions were filed raising issues  concerning
trial  evidence  and the court's  jurisdiction  over the  subject  matter of the
action. In March, 2005, the court held oral argument on these motions.

On  November  8, 2006,  the Court  entered an Order  dismissing  the case in its
entirety  on the basis  that the  action  was  preempted  by  federal  law.  The
plaintiffs  appealed the Court's decision in December,  2006. On March 22, 2007,
the  Superior  Court  entered  a  scheduling  order  for  briefing.  On  May  1,
plaintiffs/appellants filed their opening brief. The Company's brief in response
is due on May 30, 2007.

For the reasons stated by the Court in dismissing the case, as well as for other
reasons,  the Company  believes  that  plaintiffs'  case on appeal  lacks merit;
however, no prediction as to the outcome of the appeal can be made.

               MONIQUE FONTENOT DOYLE VS. THE QUIGLEY CORPORATION
                  (U.S.D.C., W.D. LA. DOCKET NO.: 6:06CV1497)

On August 31, 2006,  the  plaintiff  filed an action  against the Company in the
United   States   District   Court  for  the  Western   District  of   Louisiana
(Lafayette-Opelousas  Division).  The  action  alleges  the  plaintiff  suffered
certain  losses and injuries as a result of the Company's  nasal spray  product.
Among the allegations of plaintiff are breach of express  warranties and damages
pursuant to the Louisiana Products Liability Act.

At the present  time this matter is being  defended by the  Company's  liability
insurance  carrier.  However,  the Company has been tendered the defense of this
action for which there is no insurance. The Company is vigorously defending this
lawsuit and  believes  that the action  lacks  merit.  However,  at this time no
prediction as to the outcome of the case can be made.

                 GREG SCRAGG VS. THE QUIGLEY CORPORATION, ET AL.
               (U.S.D.C, D. COLO. DOCKET NO.: 06- 00061 LTB-CBS)

On November  30, 2005,  an action was brought in the  District  Court of Denver,
Colorado.  The complaint was served on the Company soon  thereafter.  The action
alleges the plaintiff  suffered certain losses and injuries as a result of using
the Company's  nasal spray product.  The complaint  consists of counts for fraud
and  deceit  (fraudulent  concealment),   negligent  misrepresentation,   strict
liability (failure to warn), and strict product liability (design defect).


                                      -26-


A trial  date has  been set for  August  27,  2007.  The  Company  believes  the
plaintiff's claims are without merit and is vigorously defending this lawsuit.

At the present time this matter is being defended by the Company. Based upon the
information  the  Company has at this time,  it  believes  the action is without
merit. However, at this time no prediction as to the outcome can be made.

                    INNERLIGHT INC. VS. THE MATRIX GROUP, LLC
          (FOURTH JUDICIAL DISTRICT COURT, UTAH COUNTY, STATE OF UTAH)

On March 13, 2006  Innerlight  Inc. filed a declaratory  judgment  action in the
Fourth Judicial District,  Utah County, State of Utah,  requesting a declaration
that there is no valid contract  between the parties.  The Matrix Group, LLC has
alleged there is a contract  between the parties  obligating  Innerlight Inc. to
purchase  $750,000 of products for the 12-month  period  commencing  October 18,
2004 and ending October 17, 2005,  $1,500,000 for the period commencing  October
18, 2005 and ending October 17, 2006, and for each 12-month  period  thereafter,
through and including October 17, 2013, at least $4,000,000 of products from The
Matrix Group, LLC. The document on which Matrix relies was drafted by Matrix and
states that the acceptance of the appointment by distributor  (Innerlight  Inc.)
is conditioned upon  distributor's  written  acceptance of the Company's product
price list.  No written  acceptance  of the product  price list was ever made by
Innerlight Inc.

The  Matrix  Group,  LLC filed a Utah Rule of Civil  Procedure  12(b)(3)  motion
asking  that the  complaint  be  dismissed.  On July 13,  2006 the Court for the
Fourth Judicial District,  Utah County,  State of Utah, entered an order denying
defendant's  motion  to  dismiss  under  Rule  12(b)(3)  based  on  Innerlight's
assertion  that a  material  condition  precedent  remains  to be  satisfied  to
establish an enforceable  agreement  between the parties.  The Utah County Court
has maintained  jurisdiction of this action to make a final determination on the
merits of Innerlight's claim.

Thereafter,  Matrix filed a counterclaim  alleging that a contract did exist and
that  Innerlight  had breached this  contract.  Both parties then agreed to stay
discovery,  concluding  that  discovery was not necessary and both filed motions
for summary judgment to resolve the case.

On January 17, 2007, arguments were presented to the Court on the parties' cross
motions for summary judgment and the Court ruled in Innerlight's favor,  finding
that no contract existed between the parties and that Innerlight was entitled to
return over $150,000 in product to Matrix for reimbursement.  The wording of the
final Order granting  Innerlight's motion and rejecting Matrix's were entered by
the  Court on April  10,  2007.  Matrix  has the  right to  appeal.  Matrix  has
expressed its intent to appeal the Court's  summary  judgment ruling and related
rulings, and has filed a motion to stay enforcement of the Court's order pending
appeal,  and for an order excusing Matrix from the requirement of filing a bond.
Innerlight intends to oppose Matrix's motion and any appeal vigorously.

For the reasons  stated by the Court in the case, as well as for other  reasons,
the Company believes that plaintiffs'  case on appeal lacks merit;  however,  no
prediction as to the outcome of the appeal can be made.

                          TERMINATED LEGAL PROCEEDINGS

          ZANG ANGELFIRE, TRACEY ARVIN, SHANE HOHNSTEIN, TAMMY LAURENT,
                BARBARA SEOANE, DONNA SMALLEY, AND JOHN WILLIAMS
                           VS. THE QUIGLEY CORPORATION
             (PA. C.C.P., BUCKS COUNTY, DOCKET NO. 2004-07364-27-2)

On November 4, 2004, the above plaintiffs filed an action in the Court of Common
Pleas of Bucks County  against the Company.  The  complaint was amended on March
11, 2005.  The action alleged that the  plaintiffs  suffered  certain losses and
injuries as a result of using the Company's nasal spray product.  The plaintiffs
claimed  the  Company  was  liable to them based on the  following  allegations:
negligence,  strict products  liability  (failure to warn and defective design),
breach of express warranty,  breach of implied warranty,  and a violation of the
Pennsylvania  Unfair  Trade  Practices  and  Consumer  Protection  Law and other
consumer protection statutes.

These  actions were recently  settled at the direction of the insurance  carrier
out of insurance proceeds.


                                      -27-


         BRIGITTE YVON & KLAUS YVON VS. THE QUIGLEY CORPORATION, ET AL.

On October 12, 2005,  the  Plaintiffs  instituted  an action  against  Caribbean
Pacific Natural  Products,  Inc. and other defendants for personal injuries as a
result of being hit by a chair on the pool deck of Waikoloa Beach Marriott Hotel
d/b/a Outrigger Enterprises,  Inc. in Honolulu, Hawaii. On December 9, 2005, The
Quigley Corporation was added as an additional  defendant without notice to this
case. The main defendant in the case is Caribbean Pacific Natural Products, Inc.
in which The Quigley  Corporation  formerly held stock.  On January 22, 2003 all
shares of The Quigley Corporation stock were sold to Suncoast Naturals,  Inc. in
return for stock of Suncoast  Naturals,  Inc. At the time of the  accident,  The
Quigley  Corporation  had no  ownership  interest in Caribbean  Pacific  Natural
Products,  Inc.  On April 26,  2007,  counsel  for all  parties  entered  into a
stipulation  for  partial   dismissal  without  prejudice  against  The  Quigley
Corporation.


                                      -28-


ITEM 6.  EXHIBITS

(1)   Exhibit 31.1  Certification  by the Chief  Executive  Officer  pursuant to
      Section 302 of the Sarbanes-Oxley Act of 2002
(2)   Exhibit 31.2  Certification  by the Chief  Financial  Officer  pursuant to
      Section 302 of the Sarbanes-Oxley Act of 2002
(3)   Exhibit 32.1  Certification  by the Chief  Executive  Officer  pursuant to
      Section 906 of the Sarbanes-Oxley Act of 2002
(4)   Exhibit 32.2  Certification  by the Chief  Financial  Officer  pursuant to
      Section 906 of the Sarbanes-Oxley Act of 2002


                                      -29-


                                   SIGNATURES

Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned thereunto duly authorized.

                                                THE QUIGLEY CORPORATION

                                                By: /s/ George J. Longo
                                                    --------------------------------
                                                    George J. Longo
                                                    Vice President, Chief Financial Officer

Date: May 7, 2007


                                      -30-

EX-31.1

                                                                   Exhibit  31.1


                                 CERTIFICATIONS

I, Guy J. Quigley, certify that:

1.  I  have  reviewed  this  quarterly  report  on  Form  10-Q  of  The  Quigley
Corporation, a Nevada corporation (the "registrant");

2. Based on my knowledge, this report does not contain any untrue statement of a
material  fact or omit to state a material  fact  necessary in order to make the
statements made, in light of the circumstances  under which such statements were
made, not misleading with respect to the period covered by this report;

3.  Based  on my  knowledge,  the  financial  statements,  and  other  financial
information included in this report, fairly present in all material respects the
financial  condition,  results of operations and cash flows of the registrant as
of, and for, the periods presented in this report;

4.  The  registrant's  other  certifying  officer  and  I  are  responsible  for
establishing and maintaining  disclosure  controls and procedures (as defined in
Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal  control over financial
reporting  (as defined in Exchange Act Rules  13a-15(f)  and  15d-15(f)  for the
registrant and we have:

      a)  Designed  such  disclosure  controls  and  procedures,  or caused such
      disclosure  controls and procedures to be designed under our  supervision,
      to ensure that material information relating to the registrant,  including
      its consolidated subsidiaries,  is made known to us by others within those
      entities,  particularly  during the  period in which this  report is being
      prepared;

      b) Designed such internal control over financial reporting, or caused such
      internal  control  over  financial  reporting  to be  designed  under  our
      supervision,  to provide reasonable assurance regarding the reliability of
      financial  reporting  and the  preparation  of  financial  statements  for
      external  purposes  in  accordance  with  generally  accepted   accounting
      principles;

      c) Evaluated the effectiveness of the registrant's disclosure controls and
      procedures  and  presented  in  this  report  our  conclusions  about  the
      effectiveness of the disclosure controls and procedures,  as of the end of
      the period covered by this report based on such evaluation; and

      d)  Disclosed  in this  report  any  change in the  registrant's  internal
      control over  financial  reporting that occurred  during the  registrant's
      most recent fiscal quarter (the registrant's  fourth fiscal quarter in the
      case of an annual report) that has materially  affected,  or is reasonably
      likely to  materially  affect,  the  registrant's  internal  control  over
      financial reporting; and

5. The registrant's other certifying officer and I have disclosed,  based on our
most recent  evaluation of internal  control over  financial  reporting,  to the
registrant's  auditors  and the audit  committee  of the  registrant's  board of
directors (or persons performing the equivalent functions):

      a) All significant  deficiencies and material  weaknesses in the design or
      operation  of  internal   control  over  financial   reporting  which  are
      reasonably likely to adversely affect the registrant's  ability to record,
      process, summarize and report financial information; and

      b) Any fraud,  whether or not material,  that involves management or other
      employees who have a significant role in the registrant's internal control
      over financial reporting.

Date: May 7, 2007

                                                By: /s/ Guy J. Quigley
                                                    ----------------------------
                                                    Guy J. Quigley
                                                    Chief Executive Officer

EX-31.2

                                                                    Exhibit 31.2


                                 CERTIFICATIONS

I, George J. Longo, certify that:

1.  I  have  reviewed  this  quarterly  report  on  Form  10-Q  of  The  Quigley
Corporation, a Nevada corporation (the "registrant");

2. Based on my knowledge, this report does not contain any untrue statement of a
material  fact or omit to state a material  fact  necessary in order to make the
statements made, in light of the circumstances  under which such statements were
made, not misleading with respect to the period covered by this report;

3.  Based  on my  knowledge,  the  financial  statements,  and  other  financial
information included in this report, fairly present in all material respects the
financial  condition,  results of operations and cash flows of the registrant as
of, and for, the periods presented in this report;

4.  The  registrant's  other  certifying  officer  and  I  are  responsible  for
establishing and maintaining  disclosure  controls and procedures (as defined in
Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal  control over financial
reporting  (as defined in Exchange Act Rules  13a-15(f)  and  15d-15(f)  for the
registrant and we have:

      a)  Designed  such  disclosure  controls  and  procedures,  or caused such
      disclosure  controls and procedures to be designed under our  supervision,
      to ensure that material information relating to the registrant,  including
      its consolidated subsidiaries,  is made known to us by others within those
      entities,  particularly  during the  period in which this  report is being
      prepared;

      b) Designed such internal control over financial reporting, or caused such
      internal  control  over  financial  reporting  to be  designed  under  our
      supervision,  to provide reasonable assurance regarding the reliability of
      financial  reporting  and the  preparation  of  financial  statements  for
      external  purposes  in  accordance  with  generally  accepted   accounting
      principles;

      c) Evaluated the effectiveness of the registrant's disclosure controls and
      procedures  and  presented  in  this  report  our  conclusions  about  the
      effectiveness of the disclosure controls and procedures,  as of the end of
      the period covered by this report based on such evaluation; and

      d)  Disclosed  in this  report  any  change in the  registrant's  internal
      control over  financial  reporting that occurred  during the  registrant's
      most recent fiscal quarter (the registrant's  fourth fiscal quarter in the
      case of an annual report) that has materially  affected,  or is reasonably
      likely to  materially  affect,  the  registrant's  internal  control  over
      financial reporting; and

5. The registrant's other certifying officer and I have disclosed,  based on our
most recent  evaluation of internal  control over  financial  reporting,  to the
registrant's  auditors  and the audit  committee  of the  registrant's  board of
directors (or persons performing the equivalent functions):

      a) All significant  deficiencies and material  weaknesses in the design or
      operation  of  internal   control  over  financial   reporting  which  are
      reasonably likely to adversely affect the registrant's  ability to record,
      process, summarize and report financial information; and

      b) Any fraud,  whether or not material,  that involves management or other
      employees who have a significant role in the registrant's internal control
      over financial reporting.

Date: May 7, 2007

                                                By: /s/ George J. Longo
                                                    ----------------------------
                                                    George J. Longo
                                                    Chief Financial Officer

EX-32.1

                                                                    Exhibit 32.1


                    CERTIFICATION OF CHIEF EXECUTIVE OFFICER

  Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. ss.1350)

Pursuant to Section 906 of the Sarbanes-Oxley  Act of 2002 (18 U.S.C.  ss.1350),
the  undersigned,  Guy J. Quigley,  the Chief  Executive  Officer of The Quigley
Corporation,  a Nevada corporation (the "Company"),  does hereby certify, to his
knowledge, that:

The  Quarterly  Report on Form 10-Q for the quarter  ended March 31, 2007 of the
Company (the "Report") fully complies with the  requirements of section 13(a) or
15(d) of the Securities  Exchange Act of 1934, and the information  contained in
the Report fairly presents,  in all material respects,  the financial  condition
and results of operations of the Company.

                                                /s/ Guy J. Quigley
                                                --------------------------------
                                                Guy J. Quigley
                                                Chief Executive Officer
                                                May 7, 2007

EX-32.2

                                                                    Exhibit 32.2


                    CERTIFICATION OF CHIEF FINANCIAL OFFICER

  Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. ss.1350)

Pursuant to Section 906 of the Sarbanes-Oxley  Act of 2002 (18 U.S.C.  ss.1350),
the  undersigned,  George J. Longo,  the Chief Financial  Officer of The Quigley
Corporation,  a Nevada corporation (the "Company"),  does hereby certify, to his
knowledge, that:

The  Quarterly  Report on Form 10-Q for the quarter  ended March 31, 2007 of the
Company (the "Report") fully complies with the  requirements of section 13(a) or
15(d) of the Securities  Exchange Act of 1934, and the information  contained in
the Report fairly presents,  in all material respects,  the financial  condition
and results of operations of the Company.

                                                /s/ George J. Longo
                                                --------------------------------
                                                George J. Longo
                                                Chief Financial Officer
                                                May 7, 2007