KAL Callisto Pharmaceuticals,

Item 3.02                Unregistered Sales of Equity Securities.

On September 25, 2007, Callisto Pharmaceuticals, Inc. (the “Company”) issued a warrant to purchase 1,150,000 shares of its common stock at an exercise price of $0.47 per share to a consultant for services to be rendered to the Company’s newly formed subsidiary, Synergy Advanced Pharmaceuticals, Inc. (“Synergy”), in connection with the development of Guanilib, the Company’s proprietary compound to treat gastrointestinal disorders such as chronic constipation and irritable bowel syndrome.  So long as the consultant continues to provide services in some capacity to the Company or any of its subsidiaries, the warrant will vest in installments of 225,000 warrant shares on each of the first four anniversaries of the initial exercise date.  The remaining 250,000 warrant shares will vest immediately prior to the consummation of a sale or merger of Synergy provided that such transaction occurs on or prior to October 1, 2009 and Synergy is valued at no less than $250,000,000. In the event there is a change of control of the Company, all unvested warrant shares will immediately vest.  The form of warrant is filed herewith as Exhibit 4.1.