SecProbe.io

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IPIX Corporation
12120 Sunset Hills Rd.
Suite 410
Reston, VA  20190
t. 703.674.4100
f. 703.674.4101

United States
Securities and Exchange Commission
Washington D.C. 20549

Division of Corporate Finance
Mail Stop 4591

June 27, 2005

Re:  Response to SEC letter dated May 23, 3005
     IPIX Corporation
     Form 10-K for the year ended December 31, 2004
     Form 10-Q for the period ended March 31, 2005
     File No. 000-26363

QUESTION:
Liquidity and Capital Resources, page 25
----------------------------------------
Summary of Consolidated Cash Flow Data, page 26
1. Please  revise your  discussion  of cash flow from  operating  activities  to
discuss the underlying drivers impacting the changes in working capital.  Simply
identifying  that  components  of working  capital  changed  does not  provide a
sufficient basis to analyze your cash flow from operating  activities.  Refer to
the Interpretive Guidance in SEC Release 33-8350.

RESPONSE:
The Company's operating activities used cash of $15.2 million for the year ended
December  31,  2004  compared  to $9.0  million of cash  provided  by  operating
activities for the same period in 2003. This  fluctuation is mainly due to a net
loss of $14.7  million in 2004 compared to a net income of $1.4 million in 2003.
This change in net  results is due to a $6.1  million  income from  discontinued
operations  and $3.8  million  income  tax  benefit in 2003  compared  to a $4.9
million loss from discontinued  operations in 2004. The $2.1 million increase in
inventory  procurement  in 2004  compared to $205 thousand in the same period in
2003 was due to the  Company's  2004  launch and  inventory  build up of the new
immersive  video  and  still  product  lines.   The  loss  associated  with  the
discontinued  Admissions  business unit was due to the loss of a large customer,
eBay. In addition,  the 2004 loss from  continued  operations  was $9.8 million,

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which was $1.4 million larger than 2003 net loss of $8.4 million.  This increase
of $1.4  million  was largely  due to an  increase  in sales and  marketing  and
general and administrative expenses due to an increase in sales force to support
the  Company's  new  immersive  video  products and  consulting  fees and system
enhancements to comply with new legislation  requiring additional  documentation
of  internal   controls,   respectively.   The  Company's   non-cash  charge  of
depreciation  decreased  from $3.2 million in 2003 to $1 million in 2004 and was
due to the sale at the end of 2003 of certain  capital  assets leased from eBay.
The $3 million impairment and amortization of intangibles in 2003 compared to $0
in 2004 was due to the impairment and write off of the goodwill asset related to
the eBay transaction. In addition, the Company received a $3.3 million inflow of
cash from accounts  receivable  in 2003 compared to a $156 thousand  increase in
accounts  receivable  balances in 2004 which was due to the  decrease in revenue
and related accounts receivable relating to the Admissions business unit.

QUESTION:
Consolidated Statements of Operations, page F-4
-----------------------------------------------
2. We noted in your  MD&A and in  Footnote  2,  you have  product,  service  and
royalty revenue,  however,  you only present product revenue on the face of your
financials.  Please confirm service and royalty revenue are less than 10% of the
total revenues in accordance with Rule 5-03 (b) of Regulation S-X.

RESPONSE:
Service  revenue  is less  than 10% due to the  classification  of  discontinued
operations of the Admissions business unit in 2004.

QUESTION:
Note 2. Summary of Significant Accounting Policies, page F-8
------------------------------------------------------------
Revenue Recognition, page F-9
3. We noted your product revenue is recognized upon shipment or delivery. Please
clarify what factors determine whether a product's revenue will be recognized at
shipment or delivery.

RESPONSE:
Generally,  all contracts for products include shipping terms that transfer risk
of loss and title to the  customer  FOB  shipping  point.  Revenue is  generally
recognized  upon goods  leaving the Company's  warehouse by a common  carrier en
route to a customer or upon direct shipment from our manufacturing vendor's site
by a common carrier en route to a customer  provided there are no  uncertainties
surrounding  product  acceptance,  persuasive evidence of an arrangement exists,
there  are  no  significant  vendor  obligations  and  the  fees  are  fixed  or
determinable.  In the rare case that a  contract  is  negotiated  FOB  receiving
point,  revenue will not be  recognized  until  delivery  occurs at the customer
address  assuming the above other  conditions  have been met. In future filings,
this point will be  clarified  in Revenue  Recognition,  Summary of  Significant
Accounting Policies.

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QUESTION:
4. We noted that when multiple elements exist in an arrangement, the arrangement
fee is allocated  to the  different  elements  based upon  verifiable  objective
evidence.  Please  supplementally  explain the types of  arrangements  that fall
within this category,  especially the nature of professional  services provided.
In addition,  please tell us which items have verifiable  objective evidence and
explain the nature of the evidence.

RESPONSE:
The multiple element arrangements described in the Company's Critical Accounting
Policies in the December 31, 2004 Form 10-K for the fiscal years ended  December
31,  2004,  2003 and 2002  were  from the  Admissions  business  unit  which was
classified  as  discontinued  operations  as of December 31, 2004.  The multiple
elements in arrangements of this discontinued  operations involved  professional
services  and  transaction  hosting.  Transaction  hosting for the  discontinued
Admissions business unit for 2004, 2003 and 2002 was $1.0 million, $18.1 million
and $15.9 million,  respectively,  compared to  professional  services for 2004,
2003 and 2002 of $22 thousand, $9 thousand and $184 thousand,  respectively. The
professional  services  involved  customizing  a  customer's  picture or website
presentation prior to the transaction  hosting being performed and was delivered
with the  transaction  hosting to the customer.  Revenue was  recognized on both
elements when the transaction hosting was performed.  The professional  services
in these  transactions  did not have  verifiable  objective  evidence  since the
professional   services  related  to  the  transaction  hosting  was  not  of  a
stand-alone  value but was essential to the delivery of the transaction  hosting
if the  professional  services were required by the customer.  In most cases, no
professional services were requested to deliver the transaction hosting.

QUESTION:
Note 3. Going Concern Considerations, page F-12
-----------------------------------------------
5. We note that the Company  believes it can  generate  sufficient  cash flow to
fund its  operations  for at least 12 months;  however,  it appears that you are
also planning to make  significant  investments in the sale and marketing of new
products for the security market, which may consume available cash reserves.  We
also note that your 2004 cash used in  operating  activities  exceeds  your cash
reserves.  Please expand your discussion in future filings and supplementally to
explain  how you will  manage  your  product  expansion  while also  maintaining
sufficient cash flow.

RESPONSE:
The Company  stated in the Going Concerns  Considerations  on page F-12 that the
Company may require  additional debt and equity financing to meet future working
capital or capital  expenditure  needs. The product  expansion  discussed in the
Form 10-K included the launch of our new product  day-night camera in April 2005
that was  largely the result of  engineering  efforts in 2004 and funded by 2004
operations  and cash.  In June 2005,  we completed a ten million  dollar  equity
financing to be used for future sales and marketing  expansion.  It is currently
expected that operating expenses,  other than those in the first quarter of 2005
which were  non-reoccurring and the result of the sale of our Admission business

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unit,  will be maintained at a level that is expected to allow the Company to be
cash flow  positive  from  operations  by the end of fiscal year 2005. In future
filings, the Company will update the Going Concern Considerations  footnote with
this additional information.

QUESTION:
Note 4. Discontinued operations page F-12
-----------------------------------------
6. We noted you entered into a Patent Purchase, License and Repurchase Agreement
with AdMission Corporation. Please tell us how you accounted for the transfer of
certain patents relating to the AdMission  Business,  while the licenses for the
patents  remain with IPIX. In addition,  please tell us how you will account for
the  license  fee and  whether  you will  recognize  an asset as a result of the
repurchase right.

RESPONSE:
The Company has  historically  expensed the cost to acquire and maintain patents
as incurred.  Therefore,  at December 31, 2004 when these assets were identified
and  classified as held for sale assets there was no fair value on the financial
statements.  The  agreement  does not  require a  license  fee to be paid to the
acquiring  company,  therefore,  IPIX has the right to use these licenses and no
fee is paid or recorded. Currently, the Company has no expectation of exercising
our  repurchase  right of these  patents as we don't expect that the  triggering
event would occur.  Quarterly,  the Company will reassess the possibility of the
triggering event and our interest in the repurchase rights.

7. Please tell us what type of event would trigger repurchase rights by IPIX. In
addition, please tell us and disclose in future filings when the Patents covered
under the Patent Agreement expire.

RESPONSE:
According to the agreement,  the triggering event is when the acquiring  company
becomes insolvent and cannot meet its current  obligations for a period of three
months or longer.  The patent acquired was Patent No.  6,732,162 issued March 4,
2004  "Method of Providing  Preprocessed  Images for a Plurality of Internet Web
Sites" expiring November 15, 2019. In addition, one of the acquired applications
09/357,836  was  subsequently  issued on March 17, 2005 as Patent No.  6,895,557
"Web-based  Media Submission Tool" which expires on July 21, 2019. The other two
applications  which were acquired do not have expiration dates unless granted as
a patent in the future or abandoned.

QUESTION:
Note 11. Segment Information, page F-19
---------------------------------------
8. We noted your  reconciliation by segment to the total company did not include
a  reconciliation  to  consolidated  net  income.  Please  expand  your  segment
information  disclosure to include a complete  reconciliation in accordance with
paragraph 32 of FAS 131.

RESPONSE:
In 2005, the Company  re-integrated the security and infomedia business unit and
sold the AdMission  business unit  therefore  eliminating  segments in 2005. The

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Form  10-Q for the three  months  ended  March  31,  2005 did not have a segment
disclosure for these reasons and future filings will match this presentation.

QUESTION:
Note 2. Summary of Significant Accounting Policies, page F-8
------------------------------------------------------------
Inventory, page F-9
9. It does not appear that you considered  excess  inventories in analyzing your
inventory for  impairment.  In light of your  significant  increase in inventory
from the prior year,  please  advise us and  disclose in future  filings how you
have considered whether your inventory is excessive and the impact it could have
on the valuation. Refer to Chapter 4 of ARB 43.

RESPONSE:
Quarterly,  the Company evaluates the obsolescence of inventory based on various
factors including:  technological  advances,  inventory that becomes obsolete or
discontinued by vendors,  change in market demand or suppliers,  change in sales
forecast,  inventory turnover or age of inventory.  As of December 31, 2004, the
Company had inventory on hand to meet the needs of sales forecasts for the first
quarter  and  second  quarter  of 2005  and in order to  shorten  lead  times in
assembly  and supply of our  products.  For these  reasons,  the Company did not
consider inventory levels to be excessive.

QUESTION:
Note 12. Commitments and Contingencies, page F-19
-------------------------------------------------
Indemnifications, page F-20
10. Please advise us how you have considered the guidance in FIN45 in accounting
for these indemnification provisions.

RESPONSE:
The  indemnification  that we speak of is routine to our  business and holds our
resellers  and  distributors  harmless in any suit brought by a third party that
involves our products  regarding patent,  copyright,  design rights or any other
rights.  This  limited  liability  is  covered by our  insurance  policy and the
Company  historically  has not paid any  claims or been  required  to defend any
claim  related to these  provisions.  Accordingly,  the Company does not believe
that a  material  liability  exists to require  disclosure  in Form 10-K or 10-Q
under FIN45. Therefore,  the Company will remove the indemnification  discussion
from future filings.

QUESTION:
Item 9A. Controls and Procedures
11. In future filings, please refer to the definition of disclosure controls and
procedures  defined in Exchange Act Rules 13a-15(e) and 15d-15(e) as required by
Item 307 of Regulation S-K.

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RESPONSE:

The Company acknowledges the comment and in all future filings will refer to the
definition of disclosure  controls and procedures  defined in Exchange Act Rules
13a-15(e) and 15d-15(e) as required by Item 307 of Regulation S-K.

We acknowledge that:

  -  The Company is responsible  for the adequacy and accuracy of the disclosure
     in the filings;

  -  Staff  comments or changes to disclosure  in response to staff  comments do
     not  foreclose  the  Commission  from taking any action with respect to the
     filings; and

  -  The Company may not assert staff  comments as a defense in any  proceedings
     initiated by the Commission or any person under the federal securities laws
     of the United States.

Regards,

/s/ Charles A. Crew
-------------------

Charles A. Crew
Executive Vice President, CFO
IPIX Corporation

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