FORM 10-Q

                SECURITIES AND EXCHANGE COMMISSION
                      Washington, D.C. 20549

(Mark One)

[X]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
     OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 1999

OR

[ ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
     OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from     N/A to N/A

Commission file number 0-12984

                ADVANCED TOBACCO PRODUCTS, INC.
     (Exact name of registrant as specified in its charter)

     TEXAS                                        74-2285214
(State or other jurisdiction                 (I.R.S. Employer
of incorporation or organization)             Identification No.)

    16607 Blanco Road, Suite 1504, San Antonio, Texas 78232
(Address of principal executive offices)     (Zip Code)

                         (210) 408-7077
      (Registrant's telephone number, including area code)

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

     Indicate by check mark whether the registrant (1) has filed
all reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 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  X    No

       APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
          PROCEEDINGS DURING THE PRECEDING FIVE YEARS:

     Indicate by check mark whether the registrant has filed all
documents and reports required to be filed by Sections 12, 13 or
15(d) of the Securities Exchange Act of 1934 subsequent to the
distribution of securities under a plan confirmed by a court.

Yes  No   N/A
             APPLICABLE ONLY TO CORPORATE ISSUERS:

     Indicate the number of shares outstanding of each of the
issuer's classes of common stock, as of the latest practicable
date:
                  8,092,136 as of June 30, 1999ADVANCED TOBACCO PRODUCTS,
INC.              PART I - FINANCIAL INFORMATION
dba ADVANCED THERAPEUTIC PRODUCTS, INC.      ITEM 1:  Financial Statements
BALANCE SHEETS
                                                (Unaudited)     (Unaudited)
                                                  June 30      September 30
                                                  1999              1998

ASSETS:

CURRENT ASSETS:
    Cash & cash equivalents                    $  104,825       $  449,481
    Investments                                   881,085          471,456
    Royalties Receivable                          560,758          352,000

          Total current assets:                 1,546,668        1,272,937

LICENSE AGREEMENTS, Net:                          162,679          161,804

INVESTMENTS:                                      943,578          977,015

          TOTAL ASSETS:                        $2,652,925       $2,411,756


LIABILITIES AND SHAREHOLDERS' EQUITY:

LIABILITIES:
    Accounts payable                           $   14,352      $   19,149

          TOTAL LIABILITIES:                       14,352          19,149

SHAREHOLDER'S EQUITY:
    Common stock, $.01 par value;
     30,000,000 shares authorized;
     8,092,136 shares issued and
     outstanding as of June 30, 1999,
     and September 30, 1998                        80,922          80,922
    Additional paid-in-capital                 12,544,878      12,544,878
    Accumulated deficit                        (9,987,227)    (10,233,193)

    TOTAL STOCKHOLDERS' EQUITY:                 2,638,573       2,392,607

    TOTAL LIABILITIES AND STOCKHOLDERS'
    EQUITY:                                    $2,652,925      $2,411,756


                                         2


ADVANCED TOBACCO PRODUCTS, INC.
dba ADVANCED THERAPEUTIC PRODUCTS, INC.
STATEMENTS OF INCOME


                                                       (Unaudited)
                                                  Three Months Ended June 30
                                                       1999           1998

REVENUES:
  Royalty Income, Net                               $ 304,250      $ 231,059
             Total operating revenues:                304,250        231,059

EXPENSES:
  General and administrative                           38,497         22,013
             Total operating expenses:                 38,497         22,013

INCOME FROM OPERATIONS:                               265,753        209,046

OTHER INCOME:
  Interest Income                                      22,876         19,879
             Total other income:                       22,876         19,879

NET INCOME:                                         $ 288,629      $ 228,925

WEIGHTED AVERAGED NUMBER OF SHARES
   OF COMMON STOCK OUTSTANDING:                     8,092,136      8,092,136

WEIGHTED AVERAGED NUMBER OF SHARES
  OF COMMON STOCK OUTSTANDING -
  ASSUMING DILUTION:                                8,181,264      8,225,734

INCOME PER COMMON SHARE - BASIC AND
  ASSUMING DILUTION                                  $  .04         $  .03


                                       3

ADVANCED TOBACCO PRODUCTS, INC.
dba ADVANCED THERAPEUTIC PRODUCTS, INC.
STATEMENTS OF INCOME

                                                    (Unaudited)
                                             Nine Months Ended June 30
                                               1999          1998
REVENUES:
  Royalty Income, Net                        $858,431      $495,944
       Total operating revenues:              858,431       495,944

EXPENSES:
  General and administrative                  116,104        81,096
       Total operating expenses:              116,104        81,096

INCOME FROM OPERATIONS:                       742,327       414,848

OTHER INCOME:
  Interest Income                              70,089        57,651
       Total other income:                     70,089        57,651

NET INCOME:                                  $812,416      $472,499

WEIGHTED AVERAGED NUMBER OF SHARES
  OF COMMON STOCK OUTSTANDING:              8,092,136     8,092,136

WEIGHTED AVERAGED NUMBER OF SHARES
  OF COMMON STOCK OUTSTANDING -
  ASSUMING DILUTION:                        8,198,943     8,210,181

INCOME PER COMMON SHARE - BASIC AND
  ASSUMING DILUTION                           $ .10        $ .06



                                  4

ADVANCED TOBACCO PRODUCTS, INC.
dba ADVANCED THERAPEUTIC PRODUCTS, INC.
STATEMENTS OF CASH FLOWS


                                                        (Unaudited)
                                                 Nine Months Ended June 30
                                                     1999           1998

CASH FLOWS FROM OPERATING ACTIVITIES:
  Net income:                                      $812,416       $472,499
  Adjustments to reconcile net income to net
  cash provided by operating activities:
    Amortization of license agreements                5,010          5,010
    Amortization of discount on investments         (55,050)       (54,755)
  Increase in cash flows from changes
   in operating assets and liabilities
    Royalties receivable                           (208,758)      (361,559)
    Accounts payable                                 (4,797)       (12,438)
    Net cash provided by operating activities:      548,821         48,757

CASH FLOWS FROM INVESTING ACTIVITIES:
 Purchase of license agreements and patent
   expenses                                          (5,885)        (5,416)
 Purchase of investments                           (799,142)      (499,090)
 Sale of investments                                478,000        468,000
    Net cash used in investing activities:         (327,027)       (36,506)

CASH FLOWS FROM FINANCING ACTIVITIES:
  Dividends Paid                                   (566,450)          -0-
    Net cash used in financing activities:         (566,450)          -0-

NET INCREASE (DECREASE) IN CASH AND CASH
EQUIVALENTS:                                       (344,656)        12,251

CASH & CASH EQUIVALENTS AT BEGINNING OF PERIOD:     449,481         79,180

CASH & CASH EQUIVALENTS AT END OF PERIOD:          $104,825       $ 91,431


                                    5

NOTES TO FINANCIAL STATEMENTS

   The condensed financial statements included herein have been prepared by
Advanced Tobacco Products, Inc., dba Advanced Therapeutic Products, Inc.
(the "Company")  without audit, pursuant to the rules and regulations of the
Securities and Exchange Commission.  However, all adjustments have been
made to the accompanying financial statements which are, in the opinion of
the Company's management, necessary for the fair presentation of the
Company's results of operations for the period covered.  Certain information
and footnote disclosures normally included in the financial statements
prepared in accordance with generally accepted accounting principles have
been condensed or omitted pursuant to such rules and regulations, although
the Company believes that the disclosures are adequate to make the
information presented herein not misleading.  These condensed financial
statements should be read in conjunction with the financial statements and
notes thereto included in the Company's Annual Report on Form 10-K as of June
30, 1998.


Item 2:        Management's Discussion and Analysis of Financial Condition
               and Results of Operation


                          RESULTS OF OPERATIONS

   In 1987, the Company sold patented nicotine technology, which forms the
basis of the Nicorette /Nicotrol  Inhaler, to what is now known asPharmacia
& Upjohn, Inc. ("P&U") in exchange for product payments.  Productpayments
from the non U.S. sales of the Nicorette  Inhaler are 3% of P&U'snet sales to
pharmacy distributors.  Product payments from the sales of the Nicotrol
Inhaler in the U.S. are 9.9% of P&U's net sales to McNeilConsumer Products
Company ("McNeil"), a Johnson & Johnson Company, which markets the Nicotrol
Inhaler to pharmacies as a prescription product.

    Product payments are payable on a country by country basis for the
greater of 10 years following the date of the first commercial sale or
theexpiration of all issued patents enforceable in such countries.  If the
netsales to pharmacy distributors cannot be obtained or is not disclosed,
asis the case with regard to McNeil, net sales are determined by
multiplyingthe net sales of P&U to McNeil by 3.3 (in effect, 9.9% of P&U's
sales toMcNeil).  There are product payment limitations in the event of the
sale ofa nicotine vapor product competitive with the Nicorette /Nicotrol
Inhaler. Product payments in excess of $1,000,000 per year ($333,000 in
respect ofEurope and $667,000 in respect of the rest of the world) are to be
reducedby fifty percent (50%) until the aggregate of such reductions equal
the sum of $4,400,000.

    McNeil launched the Nicotrol  Inhaler nationwide in the U.S. as a
prescription product in September 1998 (the U.S. is approximately 50% ofthe
worldwide nicotine replacement therapy ("NRT") market).  P&U has also
introduced the Nicorette  Inhaler, primarily as an over-the-counter  product,
in the United Kingdom, New Zealand, Ireland, Norway, Sweden,  Denmark, Italy,
Austria, The Netherlands, Belgium, Finland, Iceland,Gibralter and Hong Kong.
The Company understands that additional countrylaunches are planned by P&U to
occur as regulatory approvals are granted.

    The Nicorette/Nicotrol Inhaler is the first and only form of NRT
designedto help control a smoker's cravings for cigarettes while providing a
key behavioral component of smoking--the hand-to-mouth ritual.  The Inhaler
consists of a mouthpiece and a cartridge containing nicotine.  The user
puffs on the mouthpiece to inhale the nicotine which is then absorbed through
the lining of the mouth.

    In September 1992, the Company obtained an exclusive worldwide license to
certain dry powder nicotine inhaler technology from Duke University. The
Company has obtained patents covering this technology.  The Company  believes
that a dry powder nicotine inhaler has the potential to be a  future
generation NRT. The Company is continuing to seek a strategic partner to
develop this technology.

    Effective as of October 1993, the Company has an agreement with P&U under
which, among other matters, the Company has the right to receive a royalty
equal to .1% of net revenues received by P&U from the sale of any product
using a nicotine impermeable copolymer technology.  Under the terms of the
agreement, the Company now receives royalties from the sales of the
Nicorette/Nicotrol  patch by P&U.

    The Company's operations include no material dependence on any
computeroperations or on the preparation for year 2000 of any computer
operations.


LIQUIDITY AND CAPITAL RESOURCES

    Cash resources, including investments, available on June 30, 1999, were
approximately $1,930,000, as compared to approximately $1,520,000 as of June
30, 1998.

COMPARISON OF SELECTED FINANCIAL DATA

    Operating revenues for the nine month period ending June 30, 1999,
increased to $858,431, as compared to $495,944 for the nine month period
ending June 30, 1998.  This increase is due to an increase in product
payments from P&U as the Nicorette /Nicotrol  Inhaler continues to be
launched worldwide.

    Interest income for the nine month period ending June 30, 1999, increased
to $70,089, as compared to $57,651 for the nine month period ending June 30,
1998.  This increase is primarily due to an increase in cash resources
available to the Company.

    Net income for the nine month period ending June 30, 1999, increased to
$812,416, as compared to $472,499 for the nine month period ending June 30,
1998.  This increase is due to an increase in product payments from P&U as
the Nicotrol/Nicorette Inhaler continues to be launched worldwide.

    General and administrative expenses for the nine month period ending June
30, 1999, increased to $116,104, as compared to $81,096 for the nine month
period ending June 30, 1998.  This increase is primarily due to
administrative costs associated with issuing a dividend of $.07 per share of
common stock on January 6, 1999.

    Accumulated deficit decreased $245,966 from September 30,1998, to June
30, 1999.  The decrease was due to net income for the nine month period ended
June 30, 1999, of $812,416 which was partially offset by the payment of
dividends of $566,450.

PART II - OTHER INFORMATION

Item 1:                 Legal Proceedings.
                        None

Item 2:                 Changes in Securities and Use of Proceeds.
                        None

Item 3:                 Defaults Upon Senior Securities.
                        None

Item 4:                 Submission of Matters to a Vote of Security Holders.
                        None

Item 5:                 Other Information.
                        None

Item 6:                 Exhibits and Reports on Form 8-K.
                        None

   On September 14, 1998, the Company filed an 8-K disclosing that the
Company  had determined to change its fiscal year from a June 30 year end to
a September 30 year end beginning with the fiscal year ended September 30,
1999.

   Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.


                                         ADVANCED TOBACCO PRODUCTS, INC.
                                                (Registrant)
Date:  August 12, 1999
                                         By:  /s/ J.W. Linehan
                                             J. W. Linehan, Chief
                                             Executive Officer and
                                             Chief Accounting Officer