This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. In some cases, forward-looking statements are identified by terms such as "may", "will", "should", "could", "would", "expects", "plans", "anticipates", "believes", "estimates", "projects", "predicts", "potential", and similar expressions intended to identify forward-looking statements. Such statements include, without limitation, statements regarding:

- our need for, and our ability to raise additional equity or debt financing on acceptable terms, if at all;
- our belief that we have sufficient liquidity to finance normal operations until the end of May 2012;
- our need to take additional cost reduction measures, cease operations or sell our operating assets, if we are unable to obtain sufficient additional financing in the future;
- the amount of cash necessary to operate our business;
- the amount of grant revenue and anticipated uses of grant revenue in future periods;
- our plans and expectations with respect to our pressure cycling technology (PCT) operations;
- the potential applications for PCT;
- the expected expenses, benefits and results from our research and development efforts;
- the expected benefits and results from our collaboration efforts, strategic alliances and joint ventures;
- the expected increase in number of PCT units installed and the increase in revenues from sale of consumable products and extended service contracts;
- the potential size of the market for biological sample preparation;
- general economic conditions; and
- the anticipated future financial performance and business operations of our Company.

These forward-looking statements are only predictions and involve known and unknown risks, uncertainties, and other factors that may cause our actual results, levels of activity, performance, or achievements to be materially different from any future results, levels of activity, performance, or achievements expressed or implied by such forward-looking statements. Also, these forward-looking statements represent our estimates and assumptions only as of the date of this Report. Except as otherwise required by law, we expressly disclaim any obligation or undertaking to release publicly any updates or revisions to any forward-looking statement contained in this Report to reflect any change in our expectations or any change in events, conditions, or circumstances on which any of our forward-looking statements are based or to conform to actual results. We qualify all of our forward-looking statements by these cautionary statements. You should read this section in combination with the section entitled Management's Discussion and Analysis of Financial Condition and Results of Operations for the year ended December 31, 2011 included in our Annual Report on Form 10-K for the year ended December 31, 2011.

Factors that could cause or contribute to differences in our future financial and operating results include those discussed in the risk factors set forth in Item 1 of our Annual Report on Form 10-K for the year ended December 31, 2011, as well as those discussed elsewhere in this Report. The risks described in our Form 10-K and this Report are not the only risks that we face. Additional risks not presently known to us or that we do not currently consider significant may also have an adverse effect on us. If any of the risks actually occur, our business, results of operations, cash flows or financial condition could suffer.

As of May 10, 2012, we had available cash of approximately $81,000. We require additional capital to fund our operations and cannot ensure that additional capital will be available on acceptable terms or at all.

We have experienced negative cash flows from operations from our pressure cycling technology business since we commenced our pressure cycling technology operations. As of May 10, 2012, we had available cash of approximately $81,000 which, based on current projections, will be sufficient to fund normal operations until the end of May 2012. We need substantial additional capital to fund our operations in periods beyond May 2012. If we are unable to raise sufficient funds from equity or debt financings or other sources of financing, we may need to cease our business operations.

We failed to meet applicable NASDAQ Stock Market requirements and as a result we delisted our stock from The NASDAQ Capital Market, which could adversely affect the market liquidity of our common stock and harm our businesses.

Until April 5, 2012, our common stock was traded on The NASDAQ Capital Market. As a result of our stockholders' equity falling below the minimum $2.5 million requirement and the bid price of our common stock remaining below the minimum $1.00 per share requirement for continued inclusion on The NASDAQ Capital Market, on April 5, 2012, our common stock was delisted from The NASDAQ Capital Market and on April 5, 2012 our common stock began trading on the OTCQB Marketplace under the ticker symbol PBIO. We continue to file periodic reports with the Securities and Exchange Commission in accordance with the requirements of Section 12(g) of the Securities Exchange Act of 1934, as amended.

Our delisting from The NASDAQ Capital Market and commencement of trading on the OTCQB Marketplace may result in a reduction in some or all of the following, each of which could have a material adverse effect on our shareholders:

• the liquidity of our shares of common stock;
• the market price of our shares of common stock;
• our ability to obtain financing for the continuation of our operations;
• the number of institutional and other investors that will consider investing in our shares of common stock;
• the number of market markers in our shares of common stock;
• the availability of information concerning the trading prices and volume of our shares of common stock; and the number of broker-dealers willing to execute trades in our shares of common stock.

Furthermore, as a result of our delisting, our shares of common stock are subject to the so-called "penny stock" rules. The SEC has adopted regulations that define a penny stock to be any equity security that has a market price per share of less than $5.00, subject to certain exceptions, such as any securities listed on a national securities exchange. For any transaction involving a penny stock, unless exempt, the rules impose additional sales practice requirements on broker-dealers, subject to certain exceptions. As a result of being a penny stock, a broker-dealer may find it more difficult to trade our shares of common stock and an investor may find it more difficult to acquire or dispose of our shares of common stock on the secondary market. Investors in penny stocks should be prepared for the possibility that they may lose their whole investment.

We have identified a material weakness in our internal control over financial reporting that could result in a material misstatement of our financial statements.

Our management is responsible for maintaining disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports to the SEC is recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms, and that such information is accumulated and communicated to our management, including our principal executive officer and our principal financial officer, as appropriate, to allow timely decisions regarding required disclosure. Our management assessed the effectiveness of the design and operation of our disclosure controls and procedures as of March 31, 2012 and concluded that the material weaknesses identified in our Annual Report on Form 10-K for the year ended December 31, 2011 relating to the lack of sufficient segregation of duties and lack of sufficiency of personnel have not been fully remediated due to our limited financial resources, and therefore our disclosure controls and procedures were not effective as of March 31, 2012.

A material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting that creates a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis. While we have performed additional substantive procedures to ensure that our consolidated financial statements as of and for the three month period ended March 31, 2012, are fairly stated in all material respects in accordance with GAAP, the completion of our remediation efforts are largely dependent upon our securing additional financing to cover the costs of implementing the changes required. If we are unsuccessful in securing such funds, remediation efforts may be adversely affected in a material manner. If our efforts are insufficient to remediate our material weaknesses, our financial statements may contain material misstatements. Any failure on our part to remediate the material weaknesses successfully may affect the results of the periodic management evaluations on the effectiveness of our internal control over financial reporting and disclosure controls and procedures that we must include in our periodic reports. A material weakness could also cause investors to lose confidence in our reported financial information.

We cannot give any assurance that the measures we are taking to remediate the identified material weaknesses will be effective. We also cannot assure that other material weaknesses will not arise as a result of our failure to maintain adequate disclosure controls and procedures or circumvention of those controls and procedures. Additionally, even if we succeed in improving our controls and procedures, those controls and procedures may not be adequate enough to prevent irregularities, identify irregularities or facilitate a fair presentation of our financial statements or reports we file with the SEC.

OVERVIEW

We have developed instruments which utilize our unique and proprietary pressure cycling technology ("PCT"), which we sell along with associated consumables and services to life sciences companies, academic institutions and government agencies. PCT represents the core of our products and has enabled our customers to perform biological sample preparation and enzymatic digestion in unique ways that were previously unavailable. The enabling capability of our PCT products allows us to continue to increase the number of applications for our platform beyond current uses, which include genomic and proteomic sample preparation, pathogen inactivation, the control of chemical and enzymatic reactions, immunodiagnostics, and protein purification. Additionally, we are pursuing business opportunities to leverage our products and PCT into new markets beyond our current focus of PCT-enhanced enzymatic digestion products designed specifically for the mass spectrometry marketplace, as well as sample preparation products for biomarker discovery, soil and plant biology, forensics, histology, and counter-bioterror applications.

PCT uses internally developed instrumentation that is capable of cycling pressure between ambient and ultra-high levels at controlled temperatures to rapidly and repeatedly control the interactions of bio-molecules. Our instrument, the Barocycler®, and our internally developed consumables product line, which includes PULSE® (Pressure Used to Lyse Samples for Extraction) Tubes as well as application specific kits (which include consumable products and reagents) together make up the PCT Sample Preparation System.

We have experienced negative cash flows from operations with respect to our pressure cycling technology business since our inception. As of March 31, 2012, we did not have adequate working capital resources to satisfy our current liabilities and as a result we have substantial doubt about our ability to continue as a going concern. Based on our current projections, including equity financing completed subsequent to March 31, 2012, we believe our current cash resources will enable us to extend our cash resources to fund normal operations until the end of May 2012. Please see Note 6, Subsequent Events.

We need substantial additional capital to fund normal operations in periods beyond the end of May 2012. If we are able to obtain additional capital or otherwise increase our revenues, we may increase spending in specific research and development applications and engineering projects and may hire additional sales personnel or invest in targeted marketing programs. In the event that we are unable to obtain financing on acceptable terms, or at all, we will likely be required to cease our operations, pursue a plan to sell our operating assets, or otherwise modify our business strategy, which could materially harm our future business prospects.

We hold 14 United States and 10 foreign patents covering multiple applications of PCT in the life sciences field. Our pressure cycling technology employs a unique approach that we believe has the potential for broad use in a number of established and emerging life sciences areas, including;

- sample preparation for genomic, proteomic, and small molecule studies;
- pathogen inactivation;
- protein purification;
- control of chemical (particularly enzymatic) reactions; and
- Immunodiagnostics (clinical laboratory testing).

Since we began operations as Pressure BioSciences in February 2005, we have installed 216 Barocycler instruments, of which 138 currently remain installed. Our customers include researchers at academic laboratories, government agencies, biotechnology, pharmaceutical and other life sciences companies in the United States, and six foreign distribution partners.

Despite the uncertainty in the capital markets since 2009 and the concomitant decrease in the capital budgets of our existing and prospective customers and despite our limited financial resources during this time, we reported a number of accomplishments in 2012.

· Collaboration with the Henry C. Lee Institute of Forensic Science ("HCL Institute"). The HCL Institute will evaluate the use of the Company's PCT platform for the extraction of DNA and other biomolecules from such samples as bone, hair, plant tissue, pollen, and finger nails. The HCL Institute will also evaluate the PCT platform for detection of counterfeit foods, which may adulterate food products such as rice and tea.

· Distribution Agreement with LA Biosystems BV ("LABio"). In March 2012, we entered into a distribution agreement with Netherlands-based life sciences company LA Biosystems. Under the terms of the agreement, we granted LABio the exclusive right to market and sell our PCT sample preparation instruments and consumables in Belgium, the Netherlands, and Luxembourg. In addition, LABio has been granted the non-exclusive right to market and sell our recently released, patent-pending, mechanical homogenization device, the Shredder SG3, and its associated consumables, in the same three countries.

· Collaboration with Sage-N Research, Inc. ("Sage-N Research"). In March 2012, we entered into a collaboration development and co-marketing agreement with Sage-N Research, a supplier of data integration software for proteomics. Under the collaboration, Sage-N Research will work with us to develop software applications to integrate our PCT sample preparation instruments with the Sage-N Research software platform.

RESULTS OF OPERATIONS

Three Months Ended March 31, 2012 and 2011

Revenue

We recognized revenue of $305,661 for the three months ended March 31, 2012 as compared to $180,643 during the three months ended March 31, 2011. This increase is due to an increase in grant revenue offset by lower rental income on installed Barocyclers.

PCT Products, Services, Other. Revenue from the sale of PCT products and services was $164,772 for the three months ended March 31, 2012 as compared to $180,643 during the three months ended March 31, 2011. We had fewer active Barocycler leases during the first quarter of 2012 due to expirations. Sales of consumables of $16,621 were recorded for the three months ended March 31, 2012 compared to $18,731 during the same period in the prior year. Our domestic and foreign installations of PCT systems are set forth in the table below.

                                  For the Three Months Ended
                                           March 31,
                                     2012            2011
Domestic                                    5               8
International                               2               2
Total PCT System Installations              7              10

Grant Revenue. During the three months ended March 31, 2012, we recorded $140,889 of grant revenue. We continue to work on a Phase I grant received from the National Institutes of Health, or NIH, to help fund the development of a high pressure-based system to improve the processing of cancer and other samples, and a Phase II grant received from the Department of Defense, or DOD, to fund the development of a PCT-based system to improve the processing of pathogenic organisms. Both grants were awarded in the second half of 2011. During the three months ended March 31, 2011, we did not have any active grants.

Cost of PCT Products and Services

The cost of PCT products and services was $78,194 for the three months ended March 31, 2012 compared to $78,929 for the comparable period in 2011. While we sold one less Barocycler in the current quarter than in the prior period in 2011, product costs stayed flat. We sold a demonstration unit during the three months ended March 31, 2011. A portion of the unit's cost was already recognized through depreciation.

Research and Development

Research and development expenditures were $271,611 during the three months ended March 31, 2012 as compared to $218,965 in the same period in 2011. We applied engineering costs of approximately $55,000 to our inventory value in the prior period to reflect costs involved in manufacturing new product lines.

Research and development expense recognized in the three months ended March 31, 2012 and 2011 included $2,618 and $21,604 of non-cash, stock-based compensation expense, respectively. This decrease is due to expense adjustments for fully vested options included in the first quarter of 2011, which did not occur in the same period in 2012.

Selling and Marketing

Selling and marketing expenses decreased to $238,092 for the three months ended March 31, 2012 from $303,839 for the comparable period in 2011. This decrease was primarily due to employee related savings from a smaller headcount offset by tradeshow and travel related expenses.

During the three months ended March 31, 2012 and 2011, selling and marketing expense included $3,113 and $31,012 of non-cash, stock-based compensation expense, respectively. This decrease is due to expense adjustments for fully vested options included in the first quarter of 2011, which did not occur in the same period in 2012.

General and Administrative

General and administrative costs totaled $682,346 for the three months ended March 31, 2012 as compared to $412,529 for the comparable period in 2011. We increased our investor relations efforts in the current period. We also incurred increased audit fees relating to accounting matters and legal fees in connection with our completed private placements and amendments to our Registration Statement on Form S-1 originally filed in December 2011.

During the three months ended March 31, 2012 and 2011, general and administrative expense included $3,137 and $16,350 of non-cash, stock-based compensation expense, respectively. This decrease is due to expense adjustments for fully vested options included in the first quarter of 2011, which did not occur in the same period in 2012.

Operating Loss

Our operating loss was $964,582 for the three months ended March 31, 2012 as compared to $833,619 for the comparable period in 2011. The increased operating loss resulted primarily for the reasons noted above.

Other income (expense), net

Interest (Expense) Income

Interest expense totaled $56,313 for the three months ended March 31, 2012 as compared to interest income of $254 for the three months ended March 31, 2011. We recorded $10,170 of interest expense for the three months ended March 31, 2012 related to our short-term loans. We also amortized approximately $46,000 of imputed interest against the debt discount on these short-term loans relating to warrants issued with these loans.

Change in fair value of warrant derivative liability

During the three months ended March 31, 2012, we recorded non-cash charge of $42,012 for warrant revaluation expense in our consolidated statements of operations due to an increase in the fair value of the warrant liability related to warrants issued in our Series C private placement and Series D registered direct offering. This increase in fair value was primarily due to an adjustment in the exercise price and number of warrants relating to the Series D registered direct offering effected with the February 2012 private placement.

Net Loss

During the three months ended March 31, 2012, we recorded a net loss to common shareholders of $1,087,321 or $(0.14) per share, as compared to a net loss to common shareholders of $966,455 or $(0.34) per share in the three months ended March 31, 2011. The increase is due to increased operating costs partially offset by the conclusion of dividend payments to Series A holders. We accrued dividends for the Series B Convertible Preferred Stock through April 3, 2012.

LIQUIDITY AND FINANCIAL CONDITION

As of March 31, 2012, we did not have adequate working capital resources to satisfy our current liabilities. Based on our current projections, including the proceeds from our equity financing described in Note 6 completed subsequent to March 31, 2012, we believe our current cash resources will enable us to extend our cash resources to fund normal operations until the end of May 2012.

We will need substantial additional capital to fund our operations in periods beyond May 2012. In the event that we are unable to obtain financing on acceptable terms, or at all, we will likely be required to cease our operations, pursue a plan to sell our operating assets, or otherwise modify our business strategy, which could materially harm our future business prospects.

Net cash used in operations for the three months ended March 31, 2012 was $584,737 as compared to $508,052 for the three months ended March 31, 2011. The increase in cash used in operations in 2012 as compared to 2011 is principally due to an increase in operating loss of $132,727 offset by payments to third parties in shares of the Company's common stock in lieu of cash.

Net cash used in investing activities for the three months ended March 31, 2012 was not significant as compared to cash used of $7,568 for the same period in the prior year. Cash used in investing activities during the prior period was for Barocycler instruments that we purchased and installed under lease agreements.

Net cash provided by financing activities for the three months ended March 31, 2012 was $377,454 as compared to $43,980 for the same period in the prior year.

On February 7, 2012, we completed a private placement with 7 accredited investors, pursuant to which we sold an aggregate of 971,867 shares of common stock, $0.01 par value ("Shares"), resulting in gross proceeds to us of $800,000 (the "Private Placement"). The price per unit was $0.8025 for units consisting of 789,350 shares and 394,677 warrants, and was $0.9125 for units consisting of the remaining 182,517 shares and 91,260 warrants. Of the $800,000 invested in the private placement, $412,453 was received in cash and $387,547 was from the conversion of outstanding principal and interest on convertible promissory notes issued by us in 2011. In connection with the Private Placement, we paid our investment banker a fee of $35,000 for providing advisory services.