FORM 10-QSECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549

(Mark One)

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

For the quarterly period ended December 31, 2002OR[ ]            TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)            OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition periodfrom            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 703, San Antonio, Texas 78232(Address of principal executive offices)(Zip Code)(210) 408-1995(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 markwhether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has beensubject to such filing requirements for the past 90 days.

Yes   [X] No [ ]

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule12b-2 of the Exchange Act.

Yes   [ ] No [X]

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

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

N/A

APPLICABLE ONLY TO CORPORATE ISSUERS:

           Indicate the number ofshares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date:

8,212,136 as of February 3, 2003ADVANCED TOBACCO PRODUCTS,INC.                  PART I - FINANCIALINFORMATIONdba ADVANCED THERAPEUTIC PRODUCTS,INC.                     ITEM1:Financial StatementsBALANCE SHEET                                                                                                       (Unaudited)         (Audited)                                                                                                     December 31        September 30                                                                                                           2002                    2002
| ASSETS:                                                                                                   |                                                        |                                                        |
|-----------------------------------------------------------------------------------------------------------|--------------------------------------------------------|--------------------------------------------------------|
|                                                                                                           |                                                        |                                                        |
| CURRENT ASSETS:                                                                                           |                                                        |                                                        |
|     Cash & cash equivalents                                                            |     $  641,510                     |     $  348,422                     |
|     Product Payments Receivable                                                            |        224,063           |        187,385           |
|     Interest Receivable                                                                    |          2,045 |          2,077 |
|     Investments                                                                            |        400,887           |        568,212           |
|        TOTAL CURRENT ASSETS:                                                |       1,268,505                    |      1,106,096                     |
|                                                                                                           |                                                        |                                                        |
| LICENSE AGREEMENTS, Net:                                                                                  |        139,533           |        144,098           |
|                                                                                                           |                                                        |                                                        |
| LONG TERM INVESTMENTS:                                                                                    |      1,160,685                     |      1,149,529                     |
|                                                                                                           |                                                        |                                                        |
|           TOTAL ASSETS:                                      |     $2,568,723                          |     $2,399,723                          |
|                                                                                                           |                                                        |                                                        |
| LIABILITIES AND STOCKHOLDERS'   EQUITY:                                                              |                                                        |                                                        |
|                                                                                                           |                                                        |                                                        |
|     Book Overdraft                                                                         |                     |     $   21,515                |
|     Accrued Liabilities                                                                    |     $   38,984                |         22,345      |
|                                                                                                      |                                                        |                                                        |
|           TOTAL LIABILITIES:                                 |         38,984      |         43,860      |
|                                                                                                           |                                                        |                                                        |
| STOCKHOLDERS’ EQUITY:                                                                               |                                                        |                                                        |
| Common stock, $.01 par value;                                                                             |                                                        |                                                        |
|   30,000,000 shares authorized;                                                                      |                                                        |                                                        |
|   8,222,136 shares issued and   outstanding as of December 31,                                  |                                                        |                                                        |
|   2002, and September 30,2002,   respectively                                                   |         82,222      |         82,222      |
|     Additional paid-in-capital                                                             |     12,595,767                          |     12,595,767                          |
|     Accumulated deficit                                                                    |    (10,148,250)                              |    (10,322,126)                              |
|                                                                                                           |                                                        |                                                        |
|    TOTAL STOCKHOLDERS’ EQUITY:                                                            |      2,529,739                     |      2,355,863                     |
|                                                                                                           |                                                        |                                                        |
|     TOTAL LIABILITIES AND        STOCKHOLDERS’ EQUITY: |     $2,568,723                          |     $2,399,723                          |

ADVANCED TOBACCO PRODUCTS, INC.dba ADVANCED THERAPEUTIC PRODUCTS, INC.STATEMENTS OF INCOME                                                                                                                              (Unaudited)                                                                                                         Three Months  Ended  December  31                                                                                                               2002                                   2001
| REVENUES:                                 |                                                                                                                                                  |                                                                                                                                |
|-------------------------------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------|-------------------------------------------------------------------------------------------------------------------------------------|
|   Product Payments                   | $224,063                                                                                                                                              | $198,808                                                                                                                            |
|   Total operating revenues:          | 224,063                                                                                                                                               | 198,808                                                                                                                             |
|                                           |                                                                                                                                                       |                                                                                                                                     |
| EXPENSES:                                 |                                                                                                                                                       |                                                                                                                                     |
|   General and administrative         | 72,855                                                                                                                                                | 75,707                                                                                                                              |
|   Total operating expenses:          | 72,855                                                                                                                                                | 75,707                                                                                                                              |
|                                           |                                                                                                                                                       |                                                                                                                                     |
| INCOME FROM OPERATIONS:                   | 151,208                                                                                                                                               | 123,101                                                                                                                             |
|                                           |                                                                                                                                                       |                                                                                                                                     |
| OTHER INCOME:                             |                                                                                                                                                       |                                                                                                                                     |
|   Interest Income                    | 22,668                                                                                                                                                | 22,329                                                                                                                              |
|   Total other income:                | 22,668                                                                                                                                                | 22,329                                                                                                                              |
|                                           |                                                                                                                                                       |                                                                                                                                     |
| NET INCOME:                               | $ 173,876                                                                                                                                             | $ 145,430                                                                                                                           |
|                                           |                                                                                                                                                       |                                                                                                                                     |
| WEIGHTED AVERAGED NUMBER OF SHARES        |                                                                                                                                                       |                                                                                                                                     |
|    OF COMMON STOCK OUTSTANDING: | 8,222,136                                                                                                                                             | 8,222,136                                                                                                                           |
|                                           |                                                                                                                                                       |                                                                                                                                     |
| WEIGHTED AVERAGED NUMBER OF SHARES        |                                                                                                                                                       |                                                                                                                                     |
|   OF COMMON STOCK OUTSTANDING -      |                                                                                                                                                       |                                                                                                                                     |
|   ASSUMING DILUTION:                 | 8,222,136                                                                                                                                             | 8,222,136                                                                                                                           |
|                                           |                                                                                                                                                       |                                                                                                                                     |
| INCOME PER COMMON SHARE - BASIC AND       |                                                                                                                                                       |                                                                                                                                     |
|   ASSUMING DILUTION                  |                      $    .02 |                   $    .02 |
|                                           |                                                                                                                                                       |                                                                                                                                     |

ADVANCED TOBACCO PRODUCTS, INC.dba ADVANCED THERAPEUTIC PRODUCTS, INC.STATEMENTS OF CASH FLOWS                                                                                                                                                   (Unaudited)                                                                                                                        Three  Months  Ended  December  31                                                                                                                                           2002                   2001
| CASH FLOWS FROM OPERATING ACTIVITIES:                                                           |                                                     |                                                |
|-------------------------------------------------------------------------------------------------|-----------------------------------------------------|------------------------------------------------|
|   Net income:                                                                              |    $173,876                               |    $145,430                          |
|   Adjustments to reconcile net income to   net cash provided by operating activities: |                                                     |                                                |
|     Amortization of license agreements                                           |       4,565                |       4,376           |
|     Amortization of discount on investments                                      |     (18,831)                         |     (19,817)                    |
|   Increase in cash flows from changes                                                      |                                                     |                                                |
|    in operating assets and liabilities                                                |                                                     |                                                |
|     Product payments receivable                                                  |     (36,678)                         |     (56,713)                    |
|     Interest receivable                                                          |          32 |         269 |
|     Accounts payable                                                             |       16,639                    |      (9,756)               |
|     Net cash provided by operating activities:                                   |     139,603                          |      63,789                |
|                                                                                                 |                                                     |                                                |
| CASH FLOWS FROM INVESTING ACTIVITIES:                                                           |                                                     |                                                |
|                                                                                                 |                                                     |                                                |
|   Purchase of investments                                                                  |      -0-                        |    (200,365)                         |
|   Sale or maturity of investments                                                          |     175,000                          |   450,000                                 |
|      Net cash provided by investing activities:                                  |     175,000                          |     249,635                     |
|                                                                                                 |                                                     |                                                |
| CASH FLOWS FROM FINANCING ACTIVITIES:                                                           |                                                     |                                                |
|                                                                                            |                                                     |                                                |
|   Change in book overdraft                                                                 |     (21,515)                         |        -0-       |
|     Net cash provided by financing activities:                                   |     (21,515)                         |        -0-       |
|                                                                                            |                                                     |                                                |
| NET INCREASE IN CASH AND CASH EQUIVALENTS:                                                      |     293,088                          |     313,424                     |
|                                                                                                 |                                                     |                                                |
| CASH & CASH EQUIVALENTS AT BEGINNING    OF PERIOD:                                |     348,422                          |     193,498                     |
|                                                                                                 |                                                     |                                                |
| CASH & CASH EQUIVALENTS AT END OF PERIOD:                                                   |    $641,510                               |    $506,922                          |
|                                                                                                 |                                                     |                                                |
|                                                                                                 |                                                     |                                                |
|                                                                                                 |                                                     |                                                |

NOTES TO CONDENSED FINANCIAL STATEMENTS

The condensed financial statements included herein have been prepared by Advanced TobaccoProducts, Inc., dba Advanced Therapeutic Products, Inc. (“ATP”) without audit, pursuant to the rules and regulations ofthe Securities and Exchange Commission. However, all adjustments have been made to the accompanying financial statements which are,in the opinion of ATP's management, necessary for the fair presentation of ATP's results of operations for the periodcovered.  Certain information and footnote disclosures normally included in the financial statements prepared in accordancewith generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations, although ATPbelieves that the disclosures are adequate to make the information presented herein not misleading.   Thesecondensed financial statements should be read in conjunction with the financial statements and notes thereto included in ATP'sAnnual Report on Form 10-K as of September 30, 2002.

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

FORWARD-LOOKING STATEMENTS

The forward-looking information contained in this report on Form 10-Q is subject to changeas the result of business, economic, competitive, regulatory, or other contingencies and uncertainties which cannot be predictedand which are beyond the control of ATP and are subject to changes in the plans of PHA with regard to theNicotrol®/Nicorette® Inhaler which are entirely at the discretion of PHA.

DISCUSSION OF OPERATIONS

In 1987, ATP sold patented nicotine technology, which forms the basis of theNicorette®/Nicotrol® Inhaler (“Inhaler”), to what is now Pharmacia AB and Pharmacia & Upjohn Company(“PHA”), in exchange for product payments of 3% of PHA’s net sales of the Inhaler. 

Product payments are payable on a country by country basis for the greater of 10 yearsfollowing the date of the first commercial sale or the expiration of all issued patents enforceable in such countries.  Thereare payment limitations in the event of the sale of a nicotine vapor product competitive with the Inhaler. 

The Inhaler was launched nationwide in the U.S. as a prescription product in 1998. PHA has introduced the Inhaler, primarily as an over-the-counter product, in Australia, Austria, Belgium, Canada, Czech Republic,Denmark, Estonia, Finland, France, Hong Kong, Iceland, Ireland, Italy, Malaysia, Malta, Mexico, Netherlands, New Zealand, Norway,Portugal, Russia, Singapore, South Africa, Sweden, Switzerland, Taiwan, and the United Kingdom.

The Inhaler is the only nicotine replacement product designed to help control asmoker’s cravings for cigarettes while providing a key behavioral component of smoking-the hand-to-mouth ritual.  TheInhaler consists of a mouthpiece and a cartridge containing nicotine.  The user puffs on the mouthpiece, inhaling thenicotine, which is then absorbed through the lining of the mouth.

ATP also has an agreement with PHA under which, among other matters, ATP has the right toreceive a royalty equal to .1% of net revenues received by PHA from the sale of any product using a nicotine impermeable copolymertechnology.  Under the terms of the agreement, ATP receives royalties from the sales of PHA’sNicorette®/Nicotrol® Patch in certain countries.

In addition, ATP has an exclusive worldwide license to certain dry powder nicotine inhalertechnology from Duke University. ATP has obtained several patents covering this technology.  ATP believes that a dry powdernicotine inhaler has the potential to be a future generation nicotine replacement product.

LIQUIDITY AND CAPITAL RESOURCES

Cash resources, including investments, available on December 31, 2002, were $2,207,210 ascompared to $1,941,604 as of December 31, 2001.  On January 10, 2003, and January 9, 2002, ATP paid dividends aggregating$657,770 (8 cents per share) and $411,108 (5 cents per share) respectively.

COMPARISON OF SELECTED FINANCIAL DATA

Operating revenues for the three month period ending December 31, 2002, increased to$224,063, as compared to $198,808 for the three month period ending December 31, 2001.  This increase is due to an increase inInhaler product payments from PHA.

Interest income for the three month period ending December 31, 2002, increased to $22,668as compared to $22,329 for the three month period ending December 31, 2001.  This increase is due to minor variations inearnings on investments.

Net income for the three month period ending December 31, 2002, increased to $173,876 ascompared to $145,430 for the three month period ending December 31, 2001.  This increase is due to an increase in Inhalerproduct payments from PHA

General and administrative expenses for the three month period ending December 31, 2002,decreased to $72,855 as compared to $75,707 for the three month period ending December 31, 2001.  This decrease is due tominor variations in general and administrative expenses.

Item 4:             Controls and Procedures.

Within the 90-day period immediately preceding the filing of this report, the registrant'schief executive officer and chief financial officer has evaluated the effectiveness of the design and operation of our disclosurecontrols and procedures (as defined in Rules 13a-14(c) and 15d-14(c) under the Securities Exchange Act of 1934).  Based onthat evaluation, the registrant's chief executive officer and chief financial officer concluded that the design and operation ofthe registrant's disclosure controls and procedures were effective as of the date of that evaluation.  There have been nosignificant changes in our internal controls or in other factors that could significantly affect those controls subsequent to thedate of that evaluation.

PART II - OTHER INFORMATION

Item 1:  Legal Proceedings. None

Item 2:            Changes inSecurities and Use of Proceeds. None

Item 3:            Defaults UponSenior 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 -

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant hasduly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.                                                                            ADVANCED TOBACCO PRODUCTS. INC.                                                                                                   (Registrant)

Dated: February 14,  , 2003                                                                                             By:_  /s/J. W. Linehan                                                                                                            J. W. Linehan,                                                                                                     Executive Officer and Chief                                                                                                     Financial and Accounting Officer

CERTIFICATIONS

I, J. W. Linehan, Chief Executive Officer and Chief Financial and Accounting Officer ofAdvanced Tobacco Products. Inc., certify that:

1.         I have reviewed this quarterly reporton Form 10-Q of Advanced Tobacco Products. Inc.;

2.         Based on my knowledge, this quarterlyreport does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statementsmade, in light of the circumstances under which such statements were made, not misleading with respect to the period covered bythis quarterly report;

3.         Based on my knowledge, the financialstatements, and other financial information included in this quarterly report, fairly present in all material respects thefinancial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterlyreport;

4.         I am responsible for establishing andmaintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and Ihave:

a) designed such disclosure controls and procedures to ensure that material informationrelating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities,particularly during the period in which this quarterly report is being prepared;

b) evaluated the effectiveness of the registrant’s disclosure controls andprocedures as of a date within 90 days prior to the filing date of this quarterly report (the “Evaluation Date”);and

c) presented in this quarterly report my conclusions about the effectiveness of thedisclosure controls and procedures based on our evaluation as of the Evaluation Date;

5.         I have disclosed, based on our mostrecent evaluation, to the registrant’s auditors and the audit committee of registrant’s board of directors (or personsperforming the equivalent function):

a) all significant deficiencies in the design or operation of internal controls whichcould adversely affect the registrant’s ability to record, process, summarize and report financial data and have identifiedfor the registrant’s auditors any material weaknesses in internal controls; and

b) any fraud, whether or not material, that involves management or other employees whohave a significant role in the registrant’s internal controls; and

6.         I have indicated in this quarterlyreport whether or not there were significant changes in internal controls or in other factors that could significantly affectinternal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significantdeficiencies and material weaknesses.

Dated: February 14,  , 2003                                                                                      By:  /s/ J.W. Linehan                                                                                                           J. W. Linehan                                                                                           Chief Executive Officer and Chief                                                                                            Financial and Accounting Officer