10-Q/A

U.S. Securities and Exchange Commission

Washington, D.C. 20549

Form 10-Q/A

(Mark One)

QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2008

TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT

For the transition period from _____________ to ______________

Commission file number: 000-30415

Health Enhancement Products, Inc.

(Exact name of small business issuer as specified in its charter)


Nevada		87-0699977
(State or other jurisdiction of		(IRS Employer Identification No.)
incorporation or organization)

7740 East Evans Road, Scottsdale, Arizona 85260

(Address of principal executive offices)

480-385-3800

(Issuer’s telephone number)

Not Applicable

(Former name, former address and former fiscal year, if changed since last report)

Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes S No £

Check whether the issuer is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act (Check one):

Large accelerated filer £

Accelerated filer £

Non-accelerated filer £

Smaller reporting company S

Indicate by check mark whether the issuer is a shell company (as defined in Rule 12-b2 of the Exchange Act). Yes £ No S

APPLICABLE ONLY TO CORPORATE ISSUERS

There were 50,993,517 shares of common stock, $0.001 par value, outstanding at May 15, 2008.

EXPLANATORY NOTE

We are amending our Quarterly Report on Form 10-Q (the “Original Filing”) for the three months ended March 31, 2008, which was filed with the Securities and Exchange Commission on May 15, 2008. This amendment is being filed to clarify the future cash needs of the Company. As a result of this Amendment, the certifications made pursuant to Sections 302 and 906 of the Sarbanes-Oxley Act of 2002, filed as exhibits to the Original Filing, have been re-executed and re-filed as of the date of this Amendment.

This Amendment does not modify or update other disclosures in, or exhibits to, the Original Filing, and, accordingly, this Amendment should be read in conjunction with the Original Filing.

Liquidity and Capital Resources

The condensed consolidated financial statements contained in this Report have been prepared on a “going concern” basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. We have an immediate and urgent need for additional capital. For the reasons discussed herein, there is a significant risk that we will be unable to continue as a going concern, in which case, you would suffer a total loss of your investment in our company.

We have had limited revenue ($35,551 for the three months ended March 31, 2008) and have incurred significant net losses since inception, including a net loss of $667,414 during the three months ended March 31, 2008. We expect only limited sales revenue until at least the second quarter of 2008. Further, we have incurred recurring negative cash flow from operations. During the three months ended March 31, 2008, we incurred negative cash flows from operations of $382,847. As of May 15, 2008, we had a cash balance of approximately $45,000. We had a working capital deficiency of $431,809 and a stockholders’ deficit of $369,126 as of March 31, 2008. Although we recently raised a limited amount of capital, we have in the past had difficulty in raising capital from external sources. These factors raise substantial doubt about our ability to continue as a going concern.

During the three months ended March 31, 2008 and 2007, our operating activities used $382,847 and $480,172 in cash, respectively. Our financing activities generated $442,019 and $960,088 during the three months ended March 31, 2008 and 2007, respectively. The approximate $500,000 decrease in cash generated by our financing activities is primarily attributable to a decrease in proceeds from the sale of common stock and warrants. In addition, we received gross proceeds from equity sales of $354,000 during the three months ended March 31, 2008.

We estimate that we will require approximately $1,250,000 in cash over the next 12 months in order to fund our operations. Based on this cash requirement, we have an immediate need for additional funding. At the present time the Company doesn’t plan to initiate the clinical research for our subsidiary. However if we were to initiate the clinical research, we would require an additional $3,000,000. For the foreseeable future, we do not expect that sales revenues will be sufficient to fund our cash requirements. Historically, we have had difficulty raising funds from external sources; however, we recently were able to raise a limited amount of capital from outside sources. If we are not able to raise additional funds in the immediate future we may be unable to continue as a going concern, in which case you will suffer a total loss of your investment in our company.

We have only limited product liability insurance. If a product claim were successfully made against us, there could be a material adverse effect on our financial condition.

SIGNATURES

In accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Date:

May 16, 2008

Health Enhancement Products, Inc.

By: /s/ Janet L. Crance

Chief Administrative Officer

Principal Financial Officer

In accordance with the Exchange Act, this report has been signed below by the following person on behalf of the registrant and in the capacities and on the dates indicated.

Date:

May 16, 2008

By: /s/ Janet L. Crance

Chief Administrative Officer

Principal Financial Officer

Date: May 16, 2008

By: /s/ Janet L. Crance

Chief Financial Officer

Principal Financial Officer

Item 6. Exhibits


Exhibit Number	Description
31.1	Certification of the Principal Executive Officer pursuant to Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934, as amended
31.2	Certification of the Principal Financial Officer pursuant to Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934, as amended
32.1	Certification of the Principal Executive Officer pursuant to U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2	Certification of the Principal Financial Officer pursuant to U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002