The Biolizard, also known as The Prototype of the Ultimate Life Form is the original prototype of Project: Shadow. It is a lizard made of Black Arms DNA that was incomplete. It is the main reason for Maria's death and was supposed to be encapsulated, but never was.
The Biolizard was created as an early version of Project: Shadow out of the DNA of the Black Arms Black Annelids, Black Worms and Death Leeches. Gerald gave it a life support system and left it in the Cannon's Core. He then created an even more powerful version, Shadow the Hedgehog.
50 years later, it was encountered by Sonic the Hedgehog and Knuckles the Echidna, programmed by Gerald to keep the Space Colony ARK on it's crash course to Earth. Shadow then distracted it so Knuckles could use the Master Emerald to stop the Chaos Emeralds. Shadow defeated it, but the Biolizard wasn't finished and absorbed the negative Chaos Energy from the Chaos Emeralds and used Chaos Control to teleport onto the Eclipse Cannon and keep the ARK on it's crash course. It transformed into the FinalHazard, but was destroyed by Super Sonic and Super Shadow.
It was reborn due to the actions of the Time Eater, but was destroyed by Modern Sonic. It was erased from existance again.
The Biolizard also appears in the adaption of Sonic Adventure 2 in Sonic X, in Maria's Request, Everyone's Request, where it is unnamed. In a flashback of 50 years ago, it is seen as a completely normal lizard.