SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-Q/A

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

  For Quarter ended September 30, 2001            Commission File Number 0-19122




                               APHTON CORPORATION
             (Exact name of registrant as specified in its charter)


               Delaware                                   95-3640931
    (State or other jurisdiction of         (I.R.S. Employer Identification No.)
     incorporation or organization)


     444 Brickell Avenue, Suite 51-507                        33131-2492
              Miami, Florida                                   (Zip Code)
   (address of principal executive offices)


       Registrant's telephone number, including area code (305) 374-7338

       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
                                           ----                   ----


           The number of shares of Common Stock outstanding as of
                the close of business on November 14, 2001:


                Class                                     Number of
                                                      Shares outstanding

    Common Stock, $0.001 par value                        17,386,996




<PAGE>


<TABLE>

<CAPTION>


                             APHTON CORPORATION

                                   Index

<S>                                                                                            <C>
                                                                                               Page

Part I - Financial Information                                                                   3

    Item 1.  Financial Statements:                                                               4

       Balance Sheets - September 30, 2001 and January 31, 2001                                  4

       Statements of Operations - Three months and eight months ended
          September 30, 2001 and 2000                                                            5

       Statements of Cash Flows - Eight months ended September 30, 2001
          and 2000                                                                               5

    Item 2.  Management's Discussion and Analysis of Financial
                  Condition and Results of Operations                                            6


Part II - Other Information                                                                     10

    Item 1.  Legal Proceedings                                                                  10

    Item 2.  Changes in Securities                                                              10

    Item 3.  Defaults Upon Senior Securities                                                    10

    Item 4.  Submission of Matters to a Vote of Security Holders                                10

    Item 5.  Other Information                                                                  10

    Item 6.  Exhibits and Reports on Form 8-K                                                   10

Signature                                                                                       11


</TABLE>


                                      -2-


<PAGE>


                             APHTON CORPORATION

                       Part I - Financial Information

The interim  financial  statements  included  herein  have been  prepared by the
Company,  without audit, pursuant to the rules and regulations of the Securities
and Exchange Commission. In the opinion of management,  the financial statements
include all  adjustments  necessary to present fairly the financial  position of
the Company as of September 30, 2001 and January 31, 2001 and the results of its
operations  and its cash  flows for the three  months  and  eight  months  ended
September 30, 2001 and 2000. It is suggested that these financial  statements be
read in conjunction with the financial statements and the notes thereto included
in the Company's latest annual report on Form 10-K/A.





                                      -3-


<PAGE>


Item 1.  Financial Statements

                               APHTON CORPORATION
                                 Balance Sheets
<TABLE>


<CAPTION>

                                                              September 30,      January 31,
                  Assets                                          2001             2001
<S>                                                           <C>                <C>
Current assets:                                                (Unaudited)
Cash and current investments:
Cash and short-term cash investments                          $ 9,242,628        $3,508,577
Investment securities-held-to-maturity                          2,973,970        13,502,695
Investment securities-trading                                     951,999         1,653,180
                                                              -----------       -----------
       Total cash and current investments                      13,168,597        18,664,452
Other assets (including current portion of
   unconditional supply commitment)                               464,700           733,323
                                                              -----------       -----------
       Total current assets                                    13,633,297        19,397,775
Equipment and improvements, net                                   191,929           166,437
Unconditional supply commitment                                 7,750,000         7,800,000
                                                              -----------       -----------
       Total assets                                           $21,575,226       $27,364,212
                                                              ===========       ===========

         Liabilities and Stockholders' Equity
Liabilities:
Current liabilities:
Accounts payable and other                                    $ 5,210,960       $ 6,207,569
                                                              -----------       -----------
       Total current liabilities                                5,210,960         6,207,569
Deferred revenue                                               10,000,000        10,000,000
                                                              -----------       -----------
       Total liabilities                                       15,210,960        16,207,569
                                                              -----------       -----------

Commitments

Stockholders' equity:
Common stock, $0.001 par value -
Authorized:  30,000,000 shares
Issued and outstanding:  17,386,996 shares at
September 30, 2001 and 16,199,493 shares at January
31, 2001                                                           17,387            16,199
Additional paid in capital                                     93,566,314        80,292,478
Purchase warrants                                                 198,900           198,900
   Accumulated deficit                                        (87,418,335)      (69,350,934)
                                                              -----------       -----------
       Total stockholders' equity                               6,364,266        11,156,643
                                                              -----------       -----------
       Total liabilities and stockholders' equity             $21,575,226       $27,364,212
                                                              ===========       ===========

</TABLE>


                                      -4-


<PAGE>




                               APHTON CORPORATION
                      Statements of Operations (Unaudited)
        For the three and eight months ended September 30, 2001 and 2000

<TABLE>

<CAPTION>

                                                   Three months ended September 30,         Eight months ended September 30,
Costs and expenses:                                 2001                2000                 2001                2000
<S>                                           <C>                   <C>                  <C>                <C>
  General and administrative                      $629,190              $615,478           $ 1,327,655        $1,407,940
  Research and development                       7,550,430             3,892,508            16,504,986         9,156,131
                                               ------------          ------------         ------------       -----------
     Total costs and expenses                    8,179,620             4,507,986            17,832,641        10,564,071
                                               ------------          ------------         ------------       ------------
     Loss from operations                       (8,179,620)           (4,507,986)          (17,832,641)      (10,564,071)
                                               ------------          ------------         -------------      ------------
Other income (expense):
  Dividend and interest income                      79,620               522,367               339,792         1,130,538
  Unrealized investment gains (losses)             (39,156)               75,870              (574,552)           (1,566)
                                               ------------          ------------         -------------       -----------
     Net loss                                  $(8,139,156)          $(3,909,749)         $(18,067,401)      $(9,435,099)
                                               ============          ============         =============      ============
Per share data:
  Basic and diluted loss per common share           $(0.48)               $(0.24)               $(1.10)           $(0.60)
                                                    =======               =======              =======            =======
  Weighted average number of
   common shares outstanding                    16,991,161            16,199,493            16,496,368        15,744,611
                                                ==========            ==========            ==========       ============

</TABLE>


     The net loss for the three and eight  months ended  September  30, 2001 and
     2000  was the  comprehensive  loss  for  those  periods.  For  all  periods
     presented potential common shares,  consisting of approximately 2.7 million
     purchase warrants, were excluded from the computation of net loss per share
     because their effect was anti-dilutive.


                               APHTON CORPORATION
                      Statements of Cash Flows (Unaudited)
             For the eight months ended September 30, 2001 and 2000


<TABLE>

<S>                                                                              <C>                    <C>

Cash flows from operating activities:                                                2001                   2000
   Cash paid to suppliers and employees                                          $(18,696,728)          $(9,228,068)
                                                                                 -------------          ------------
   Net cash used in operating activities                                          (18,696,728)           (9,228,068)
Cash flows from investing activities:
   Purchase of held to maturity securities                                         (9,675,495)          (29,919,968)
   Proceeds from maturity of held to maturity securities                           20,605,000            38,275,000
   Purchase of trading securities                                                     (39,400)              (59,114)

   Interest and dividends received                                                    339,792             1,130,538
   Capital expenditures                                                               (74,142)              (58,273)
                                                                                 ------------           ------------

   Net cash received from investing activities                                     11,155,745             9,368,183
                                                                                 ------------           -----------
Cash flows from financing activities:
   Sales of stock, net                                                             13,275,024            15,493,300
                                                                                 ------------           -----------
   Cash received from financing activities                                         13,275,024            15,493,300
                                                                                 ------------           -----------
   Net increase in cash and short-term cash investments                             5,734,051            15,633,415
Cash and short-term cash investments:
   Beginning of period                                                              3,508,577             9,920,263
                                                                                 ------------           -----------
   End of period                                                                   $9,242,628           $25,553,678
                                                                                 ============           ===========
      Reconciliation of net loss to net cash used in operating activities
Net loss                                                                         $(18,067,401)          $(9,435,099)
Adjustments to reconcile net loss to net cash used in operating activities:
   Depreciation and amortization                                                       48,650                41,116
   Unrealized losses (gains) from investments                                         574,552                 1,566
   (Decrease) increase in accrued employee benefits                                  (574,552)               (1,566)
   Changes in - Other assets                                                          268,632                57,726
   Changes in - unconditional supply commitment                                        50,000               251,650
   Changes in -Accounts payable and other                                            (996,609)               28,009
                                                                                 -------------          -----------
Net cash used in operating activities:                                           $(18,696,728)          $(9,228,068)
                                                                                 =============          ===========
</TABLE>



                                      -5-


<PAGE>


       Item 2. Management's Discussion and Analysis of Financial Condition
            and Results of Operations (Three and Eight Months Ended
                          September 30, 2001 and 2000)

                                     General
Aphton  Corporation  is a  biopharmaceutical  company in advanced stage clinical
trials. We are developing products using our innovative  vaccine-like technology
for neutralizing,  and removing from  circulation,  hormones that participate in
gastrointestinal  system and reproductive system cancer and non-cancer diseases.
We also are developing products to neutralize hormones to prevent pregnancy.  We
have strategic  alliances  with Aventis  Pasteur  (NYSE:  AVE),  GlaxoSmithKline
(NYSE:  GSK),  Schering  Plough Animal  Health (NYSE:  SGP) and the World Health
Organization (WHO).

                              Results of Operations
During the three  months ended  September  30,  2001,  costs were  significantly
increased  by  the  following   factors  which  include  costs  associated  with
preparations and documentation for an upcoming  regulatory meeting with the FDA,
and costs of expanding  the clinical  trial  program and opening more centers to
complete the international  patient recruitment network,  which contributed to a
net loss of $8,139,156.  Investment earnings on cash for the quarter was $79,620
which  represented an 85% decrease over  investment  earnings of $522,367 during
the quarter ended  September  30, 2000 due to lower average cash and  investment
balances.  Total  research  and  development  expenditures  for the quarter were
$7,550,430,  which was  approximately  94% more than  research  and  development
expenditures  for the quarter  ended  September  30, 2000.  For the eight months
ended September 30, 2001, research and development expenditures increased 80% to
$16,504,986  when compared to the eight months ended September 30, 2000. The net
loss for the three and eight  months ended  September  30, 2001 and 2000 was the
comprehensive loss for those periods.  This planned increase relates to Aphton's
expanded clinical trials programs.

                                     Results
Aphton's  primary focus during the quarter ending September 30, 2001 has been on
conducting its Phase II and Phase III clinical trials in the US and abroad.

On September 10, 2001 Aphton  announced  that its gastrin  targeted  therapy was
presented at an international  conference hosted by Aventis and collaborators on
gastric  malignancies.  This  special  symposium  on  Aphton's  gastrin  (G17DT)
targeted therapy was held at the Fourth International Conference on the Biology,
Prevention  and  Treatment  of  Gastric  Intestinal  Malignancies,  in  Cologne,
Germany.  The  special  symposium  was  chaired by Jaffer  Ajani,  MD, of the MD
Anderson Cancer Center in Houston, Texas. The conference was hosted by the major
global pharmaceutical company Aventis,  joined by the MD Anderson Cancer Center,
European and Japanese universities,  and was attended by clinical investigators,
academicians and opinion leaders in the field.  (See Aphton's news release dated
September 10, 2001 and the related ASCO news releases dated May 14, 2001 and May
15, 2001.)

On August 2, 2001 Aphton  announced that the role of gastrin in lung cancers had
been  discovered and planning has been initiated for a Phase II clinical  trial.
Recent  findings  by  Aphton  and its  collaborating  scientists,  working  with
Aphton's anti-gastrin  immunogen and anti-gastrin receptor antibodies,  indicate
that gastrin  receptors  are expressed in abundance in the  respiratory  system.
More  specifically,  in lung cancer,  including both non-small cell lung cancer,
which accounts for  approximately  75% of lung cancers and is the most difficult
to treat,  and small  cell lung  cancer.  This  involvement  of  gastrin  in the
respiratory  system is in  addition to Aphton's  previously  identified  role of
gastrin in cancers of the  gastrointestinal  system.  (See Aphton's news release
dated August 2, 2001.)

Aphton's  anti-gastrin targeted therapy induces antibodies in patients that bind
to both gastrin 17 and gly-gastrin and remove them from circulation  before they
can initiate cell growth.  Gastrin 17 and gly-gastrin are believed to be central
growth  factors,   or  the  initiating   signals,   for  cell  growth  and  cell
proliferation and metastasis (spread) in colon, pancreatic,  stomach, esophageal
and other  gastrointestinal  system  cancers.  This is  accomplished  by gastrin
binding to the large  numbers of gastrin  receptors  on the tumor cell  surface.
Interrupting  this process by immunizing the patient with Aphton's  anti-gastrin
immunogen is a precisely  "targeted"  therapy.  This selectivity  occurs because
gastrin is not normally secreted and gastrin receptors are not normally found on
"healthy" cells in either the GI system or the respiratory  system,  unless they
are malignant, or on the path to malignancy (except for cells involved with acid
secretion).  Recent  findings  have  shown that  inhibiting  gastrin a) not only
inhibits cell growth and cell proliferation  directly,  but also b) "unblocks" a
central  pathway leading to  cell-suicide  (apoptosis).  This tilts the balance,
from cell growth,  to cell suicide.  This effect was  amplified  synergistically
when Aphton's vaccine was


                                      -6-


<PAGE>


given together with a chemotherapeutic. Based on this synergism, all of Aphton's
clinical trials are now combination  therapies,  consisting of Aphton's  vaccine
and an appropriate chemotherapy.

                                      Other
Effective   February  1,  2001,  the  Company  adopted  Statement  of  Financial
Accounting  Standards ("SFAS") No. 133,  "Accounting for Derivative  Instruments
and Hedging  Activities." SFAS No. 133, as amended,  establishes  accounting and
reporting  standards  for  derivative  instruments  and hedging  activities  and
requires  the  Company  to  recognize  all   derivatives  as  either  assets  or
liabilities  on the balance sheet at fair value.  The  accounting  for gains and
losses from  changes in the fair value of a derivative  instrument  are recorded
each period in current  earnings or other  comprehensive  income,  depending  on
whether the derivative is designated as part of a hedge  transaction  and, if it
is, the type of hedge  transaction.  Historically,  the  Company has not entered
into  derivative  contracts  either to hedge existing  risks or for  speculative
purposes.  The  adoption  of SFAS No. 133 did not have a material  impact on the
financial  position,  results  of  operations  or  cash  flows  of the  Company.
Dividend, interest and other income were primarily derived from commercial paper
and money-market accounts.

                         Liquidity and Capital Resources
The Company had financed its operations since inception  through the sale of its
equity securities and, to a lesser extent,  operating  revenues from R&D limited
partnerships  to conduct  research  and  development.  These funds  provided the
Company  with the  resources  to  acquire  staff,  construct  its  research  and
development  facility,  acquire  capital  equipment and finance  technology  and
product development, manufacturing and clinical trials.

In November  the Company  filed a  registration  statement  on Form S-3 with the
Securities and Exchange Commission using a "shelf"  registration process to sell
up to 1,500,000 shares in one or more offerings. In August we announced that the
Company  had closed a $14.25  million  private  equity  financing  with  several
institutional investors.  Aphton sold approximately 1.2 million shares of common
stock at $12.00 per  share.  UBS  Warburg  acted as the  placement  agent on the
transaction and Miller Johnson  Steichen  Kinnard  assisted in the  transaction.
Related  to  our  on-going  operations  and  strategic  alliances  we  note  the
following.

In February  1997, we signed an agreement  with Pasteur  Merieux  Connaught (now
called  Aventis  Pasteur),  a leader in medical  science  and  research  and the
world's largest vaccine manufacturer and marketer,  for a strategic alliance for
all human cancer  applications of our anti-gastrin  immunogen  product including
stomach, colorectal,  liver and pancreatic cancer applications.  Under the terms
of the twenty-year  license and co-promotion  agreement,  we are responsible for
product development,  clinical trials and regulatory approvals.  Aventis Pasteur
was granted an exclusive  license to promote,  market,  distribute  and sell the
anti-gastrin  immunogen product in the United States,  Canada, Europe (including
the  Commonwealth of Independent  States  countries) and Mexico,  subject to our
right to co-promote the product either  independently or in  collaboration  with
Aventis  Pasteur.  In addition to the license  and  co-promotion  agreement,  we
entered into  agreements  with Aventis  Pasteur  providing for the supply of the
anti-gastrin  immunogen  product from us to Aventis Pasteur for distribution and
sale by Aventis Pasteur pursuant to the license and co-promotion  agreement,  as
well as the supply of  Diphtheria  Toxoid  and/or  Tetanus  Toxoid from  Aventis
Pasteur to us for use in the  anti-gastrin  immunogen  product (as well as other
Aphton  products).  Aventis Pasteur will fund the costs  associated with product
introduction,  promotion,  advertising  and marketing  throughout  the territory
covered by the  agreement.  Under the terms of the  agreement,  in  addition  to
upfront consideration  aggregating $10 million,  including $1 million cash and a
supply commitment (of Diphtheria Toxoid and/or Tetanus Toxoid suitable for human
use) of $9 million,  we will  receive the  majority of the profits from sales of
the  anti-gastrin  immunogen  product.  Diphtheria  Toxoid and/or Tetanus Toxoid
suitable for human use is not readily  obtained on the open market in such large
quantities as will be supplied to us as part of the upfront  consideration.  The
$10 million upfront  consideration  has been classified as a license payment and
has been deferred and will be recognized  for financial  statement  (accounting)
purposes as revenue within the twenty-year period of the agreement.  The revenue
recognition will begin once regulatory agency approval to market the product has
been  received and will be recognized  ratably over the remaining  period of the
contract,  which ends  February 13, 2017.  We do not  speculate on the timing of
regulatory approvals.  Either party may terminate the agreement for, among other
things,  uncured  material breach or certain events of bankruptcy or insolvency.
Aventis Pasteur has the right to terminate the agreement,  following  completion
of Phase III clinical trials in the event that it determines that for safety and
efficacy reasons it does not wish to co-promote,  market or sell the product. In
the event that the agreement is terminated  due to a material  breach by Aventis
Pasteur,  all  rights  of  Aventis  Pasteur  granted  by the  agreement  will be
terminated.  However,  Aventis  Pasteur's  obligations  with  regard  to the $10
million  upfront  consideration,  both

                                      -7-


<PAGE>


the  cash  and  our  rights  to the  full $9  million  in  unconditional  supply
commitment,  survive  termination of the agreement.  There is no provision under
the agreement for the unconditional supply commitment to be satisfied by Aventis
Pasteur with a cash payment.  In the event that the agreement is terminated  due
to a material breach by us, we will, among other things, grant Aventis Pasteur a
co-exclusive license, under our patents and know-how in North America and Europe
and the product trademarks,  to make and sell the anti-gastrin immunogen product
in exchange for royalty payments to the other party at a royalty rate based on a
percentage of net sales.

In June 1998, we signed a  collaboration  and license  agreement with SmithKline
Beecham, now called  GlaxoSmithKline,  granting it exclusive rights worldwide to
our GnRH-related patents and proprietary  technology.  The twenty-year agreement
covers the diagnosis, treatment and prevention of gonadotropin,  gonadal steroid
hormone and  GnRH-related  cancers and other  diseases in humans.  Human  cancer
indications for the anti-GnRH  product  include  prostate,  breast,  ovarian and
endometrial   cancer,  in  each  case,  either  alone  or  in  combination  with
chemotherapy.  Additional medical  indications for the anti-GnRH product include
endometriosis, polycystic ovaries, uterine fibroids, contraception,  infertility
and  precocious  puberty.  The agreement uses a royalty  mechanism  based on net
sales of the product,  worldwide, to determine our revenues.  Under terms of the
agreement,  we  are  collaborating  with  GlaxoSmithKline  in  a  joint  product
development program,  with  GlaxoSmithKline  responsible for worldwide marketing
and distribution of approved  products.  Under the agreement as amended,  we are
responsible for the initial cost of product  development prior to the acceptance
of the  anti-GnRH  product by both  parties.  Our  product  development  work is
reviewed on an ongoing basis with  GlaxoSmithKline  and after the  acceptance of
the product by both parties for development,  GlaxoSmithKline is responsible for
the funding of the development  costs of the accepted  product,  clinical trials
and approvals for worldwide  marketing and  distribution up to an agreed amount.
We believe that this product will be accepted in 2002,  although there can be no
assurance   that  we  will  achieve  our  goal.   As  part  of  the   agreement,
GlaxoSmithKline  made an equity  investment  in 1998 of  $5,000,000  for 237,867
shares of newly issued  Aphton  common  stock.  Either party may  terminate  the
agreement for, among other things,  uncured material breach or certain events of
bankruptcy  or  insolvency.  Under the  agreement as amended,  if the  anti-GnRH
product  has not been  formally  accepted  by both  parties,  either  party  may
terminate the agreement in 2002.  Once the product has been accepted for further
development,  GlaxoSmithKline  may only  terminate  the  agreement  for  safety,
efficacy or economical  reasons and Aphton may terminate for the reasons  stated
above. During the term of the agreement,  GlaxoSmithKline  will have full access
to all  matters  encompassed  within our patents  and  know-how  relating to the
anti-GnRH   product.   Upon   termination   or  expiration  of  the   agreement,
GlaxoSmithKline  will  cease  to have the  right  to use or sell  the  anti-GnRH
product, and all registrations and intellectual property rights in the anti-GnRH
product will be fully  transferred  to us. Until the  agreement is terminated or
otherwise  expires,  any invention or discovery made jointly by  GlaxoSmithKline
and us during the  development  program will be jointly  owned,  and the product
trademarks and any intellectual  property developed by  GlaxoSmithKline  will be
owned by them.

The  Schering-Plough  Animal Health agreement and the World Health  Organization
(WHO)  agreement  described  below  together  account  for  less  than 1% of our
research and development efforts and expenditures.

In August 1997, we completed a strategic  alliance with  Schering-Plough  Animal
Health covering all animal health  applications of our  anti-gastrin  immunogen.
Schering-Plough,  in  terms  of  annual  sales,  is one of  the  largest  animal
healthcare  companies in the world.  Equine  (horse)  ulcers was selected as the
first  indication  to be  pursued  under  the  alliance.  Under the terms of the
ten-year agreement,  we have granted Schering-Plough an exclusive license in the
U.S. to promote,  distribute and sell the anti-gastrin  immunogen  product under
our patents and know-how.  Schering-Plough will work closely with our scientists
and management to bring the  anti-gastrin  immunogen  product to market.  We are
currently  responsible  for  developing  the  costs of the  product  and for the
manufacture  and  supply of the  product.  Schering-Plough  is  responsible  for
certain  current and future  capital costs and financial  requirements,  product
development costs and clinical trial costs, and product introduction,  promotion
and marketing. The agreement provides that we will share equally all net profits
with  Schering-Plough,  initially  taking  into  account  certain  research  and
development costs of  Schering-Plough  in determining net profits.  Either party
may terminate the agreement for, among other things,  uncured material breach or
certain  events  of  bankruptcy  or   insolvency.   Upon  prior  notice  to  us,
Schering-Plough may terminate the agreement for safety or efficacy reasons. Upon
termination or expiration of the agreement,  Schering-Plough  will cease to have
the  right  to  use  or  sell  the  anti-gastrin   immunogen   product  and  all
registrations  and intellectual  property rights in the  anti-gastrin  immunogen
product will be fully  transferred  to us. Until the  agreement is terminated or
otherwise   expires,   any   intellectual    property   developed   jointly

                                      -8-


<PAGE>


by Schering-Plough  and us will be jointly owned, and the product trademarks and
any intellectual property developed by Schering-Plough will be owned by them.

In January  1995,  we  announced a  relationship  with WHO and another  research
party, for the development and testing of an immunocontraceptive  product (which
prevents   pregnancy),   under  which  we  received  exclusive  rights  for  the
manufacture,   distribution  and  supply  of  the  immunocontraceptive   product
worldwide,  for the term of the applicable patents on a patent-by-patent  basis.
In exchange for these rights,  we make payments to support  certain  research by
the research party. In the event that a safe and effective product is developed,
we have  undertaken to WHO to dedicate a portion of our production  capacity for
the  product to produce  and supply the  product to public  sector  agencies  in
developing countries only, according to a cost-related pricing structure. Either
party may  terminate  the  agreement  for uncured  material  breach by the other
party.  In the event that we have  ceased and  continue  to cease to perform our
obligations  under the  contract,  WHO may  terminate  the agreement and we will
grant WHO an  exclusive,  royalty-free  license to our  technology  to  develop,
manufacture and supply immunocontraceptive products to public sector agencies in
developing countries only, as well as a non-exclusive,  royalty-bearing  license
to develop,  manufacture  and supply  immunocontraceptive  products in developed
countries  and to the private  sector  generally.  Once the  immunocontraceptive
product  has  reached  a  certain  development  stage  and  subject  to  certain
consequences,  WHO may be released from its obligations  under the agreement for
lack of funds or after an  assessment  of safety and efficacy of the product and
the Company will be released from its obligations.

The Company  anticipates that its existing capital  resources which are composed
primarily of cash and short-term cash investments, including the proceeds of its
private  placements  and  interest  thereon,  would  enable it to  maintain  its
currently  planned  operations into the year 2002. The Company's working capital
and capital  requirements  will  depend upon  numerous  factors,  including  the
following:  the  progress of the  Company's  research and  development  program,
preclinical  testing  and  clinical  trials;  the timing  and cost of  obtaining
regulatory  approvals;  the  levels of  resources  that the  Company  devotes to
product  development,  manufacturing and marketing  capabilities;  technological
advances;  competition;  and collaborative  arrangements or strategic  alliances
with other drug companies, including the further development,  manufacturing and
marketing of certain of the Company's products and the ability of the Company to
obtain funds from such strategic alliances or from other sources.


                                      -9-


<PAGE>


                           Part II - Other information


Item 1.   Legal Proceedings.

          Not applicable.

Item 2.   Changes in Securities.

          Not applicable.

Item 3.   Defaults Upon Senior Securities.

          Not applicable.

Item 4.   Submission of Matters to a Vote of Security Holders.

          Not applicable.

Item 5.   Other Information.

          Not applicable.

Item 6.   Exhibits and Report on Form 8-K.

          There  were no  reports on Form 8-K filed  during  the  quarter  ended
September 30, 2001.


                                      -10-


<PAGE>


                                    Signature


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

                                     Aphton Corporation

Date:  December 19, 2001             By: /s/ Frederick W. Jacobs
                                         ---------------------------------------
                                         Frederick W. Jacobs
                                         Vice President, Treasurer, Chief
                                         Accounting Officer and Principal
                                         Financial Officer




                                      -11-