U.S. SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

                                   FORM 10-QSB

(Mark One)

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

         For the quarterly period ended: June 30, 2002
                                         -------------

                                       OR

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

                          Commission File No.: 0-20726
                                               -------


                                  Cortech, Inc.
                                  -------------
        (Exact name of small business issuer as specified in its charter)

           Delaware                                           84-0894091
           --------                                           ----------
(State or other jurisdiction of                            (I.R.S. Employer
incorporation or organization)                            Identification No.)



                376 Main Street, PO Box 74, Bedminster, NJ 07921
                ------------------------------------------------
                    (Address of principal executive offices)


                                 (908) 234-1881
                                 --------------
                           (Issuer's telephone number)


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


Check  whether the issuer (1) filed all reports  required to be filed by Section
13 or 15(d) of the  Exchange  Act during the past 12 months (or for such shorter
period  that the issuer was  required  to file such  reports),  and (2) has been
subject to such filing requirements for the past 90 days.
                                 Yes X   No
                                    ---    ---

State the number of shares outstanding of each of the issuer's classes of common
equity:  As of July 31,  2002,  the  issuer had  3,625,980  shares of its common
stock, par value $.002 per share, outstanding.

Transitional Small Business Disclosure Format (check one):

                                 Yes     No X
                                    ---    ---

<PAGE>

PART I.  -  FINANCIAL INFORMATION
-------     ---------------------
ITEM 1.  -  Financial Statements
-------     --------------------



                                  CORTECH, INC.
                                  BALANCE SHEET
                                  JUNE 30, 2002
                                 ($000 Omitted)
                                   (UNAUDITED)



ASSETS
------

Current assets:
  Cash and cash equivalents                                           $ 12,483
  Prepaid expenses and other                                                36
                                                                      --------
    Total assets                                                      $ 12,519
                                                                      ========

LIABILITIES AND STOCKHOLDERS' EQUITY
------------------------------------

Current liabilities:
  Accrued liabilities                                                 $    497
                                                                      --------
    Total liabilities                                                      497
                                                                      --------

Stockholders' equity:
  Preferred stock, $.002 par value,
   2,000,000 shares authorized,
   none issued                                                               -
  Common stock, $.002 par value, 5,000,000
   shares authorized, 3,634,680 shares
   issued and outstanding                                                    7
  Additional paid-in capital                                            99,557
  Accumulated deficit                                                (  87,542)
                                                                      --------
    Total stockholders' equity                                          12,022
                                                                      --------

    Total liabilities and stockholders' equity                        $ 12,519
                                                                      ========










                 See accompanying notes to financial statements.


                                       2



<PAGE>

                                  CORTECH, INC.
                            STATEMENTS OF OPERATIONS
                      ($000 Omitted, except per share data)
                                   (UNAUDITED)


                                                       Three Months Ended
                                                            June 30,
                                                       ------------------
                                                         2002      2001
                                                       --------  --------

Revenues:
  Interest income                                      $    56   $   165

Expenses:
  General and administrative                               702       225
                                                       -------   -------

Loss before income taxes                              (    646) (     60)
Provision for income taxes                                   -         4
                                                       -------   -------
Net loss                                              ($   646) ($    64)
                                                       =======   =======

Basic and fully diluted net
  loss per share                                      ($   .18) ($   .02)
                                                       =======   =======

Basic and diluted weighted average
  common shares outstanding (in 000's)                   3,660     3,696
                                                       =======   =======









                 See accompanying notes to financial statements.


                                       3


<PAGE>
                                  CORTECH, INC.
                            STATEMENTS OF OPERATIONS
                      ($000 Omitted, except per share data)
                                   (UNAUDITED)


                                                            Six Months Ended
                                                                 June 30,
                                                          --------------------
                                                            2002        2001
                                                          --------    --------

Revenues:
  Interest income                                         $   112     $   357

Expenses:
  General and administrative                                1,176         349
                                                          -------     -------

Income (loss) before income taxes                        (  1,064)          8
Provision for income taxes                                      -           8
                                                          -------     -------
Net income (loss)                                        ($ 1,064)    $     -
                                                          =======     =======

Basic and fully diluted net
  income (loss) per share                                ($   .29)    $     -
                                                          =======     =======

Basic weighted average common shares
  outstanding (in 000's)                                    3,674       3,705
                                                          =======     =======

Diluted weighted average common shares
  outstanding (in 000's)                                    3,674       3,726
                                                          =======     =======










                 See accompanying notes to financial statements.

                                       4

<PAGE>

                                  CORTECH, INC.
                            STATEMENTS OF CASH FLOWS
                                 ($000 Omitted)
                                   (UNAUDITED)



                                                          Six Months Ended
                                                              June 30,
                                                        --------------------
                                                          2002        2001
                                                        --------    --------

CASH FLOWS FROM OPERATING ACTIVITIES:
  Net income (loss)                                    ($  1,064)   $      -
  Adjustments:
  Change in other assets                                       2   (       6)
  Change in accrued liabilities                              318   (      16)
                                                        --------    --------
    Net cash used in operating activities              (     744)  (      22)
                                                        --------    --------

CASH FLOWS FROM INVESTING ACTIVITIES:
  Purchase of short-term investments                           -           -
  Maturities of short-term investments                         -       6,611
                                                        --------    --------
    Net cash provided by investing activities                  -       6,611
                                                        --------    --------

CASH FLOWS FROM FINANCING ACTIVITIES:
  Issuance of common stock                                     -         175
  Repurchase of common stock                           (     221)  (     223)
                                                        --------    --------
    Net cash used in financing activities              (     221)  (      48)
                                                        --------    --------

Net increase (decrease) in cash and cash
  equivalents                                          (     965)      6,541
Cash and cash equivalents, beginning of period            13,448       7,107
                                                        --------    --------
Cash and cash equivalents, end of period                $ 12,483    $ 13,648
                                                        ========    ========
















                 See accompanying notes to financial statements.


                                       5


<PAGE>

                                  CORTECH, INC.
                          NOTES TO FINANCIAL STATEMENTS
                                   (UNAUDITED)
1.   General
     -------

          The  accompanying  unaudited  financial  statements  of Cortech,  Inc.
     ("Cortech" or the  "Company") as of June 30, 2002 and for the three and six
     months  ended  June 30,  2002 and 2001  reflect  all  material  adjustments
     consisting of only normal recurring  adjustments,  which, in the opinion of
     management,  are  necessary  for a fair  presentation  of  results  for the
     interim  periods.  Certain  information and footnote  disclosures  required
     under  accounting  principles  generally  accepted in the United  States of
     America  have  been  condensed  or  omitted   pursuant  to  the  rules  and
     regulations of the Securities and Exchange Commission, although the Company
     believes  that  the  disclosures  are  adequate  to  make  the  information
     presented not  misleading.  These  financial  statements  should be read in
     conjunction with the financial statements and notes thereto included in the
     Company's Annual Report on Form 10-KSB for the year ended December 31, 2001
     as filed with the Securities and Exchange Commission.

          The preparation of financial  statements in conformity with accounting
     principles  generally  accepted  in the United  States of America  requires
     management  to make  estimates  and  assumptions  that affect the  reported
     amounts of assets and liabilities  and disclosure of contingent  assets and
     liabilities  at the  date of the  financial  statements  and  the  reported
     amounts of  revenues  and  expenses  during the  reporting  period.  Actual
     results could differ from those estimates.

          Prior year's financial statements have been reclassified to conform to
     the current year's presentation.

          The results of operations  for the three and six months ended June 30,
     2002 and 2001 are not necessarily  indicative of the results to be expected
     for the entire year or for any other period.

2.   Legal Proceedings
     -----------------

          The arbitration previously disclosed,  against Ono Pharmaceutical Co.,
     Ltd ("Ono"),  concluded in Agusut, 2002 resolving any questions  concerning
     the ownership of Cortech's intellectual property.

          Ono and Cortech are parties to an  agreement  under which Ono paid for
     the right to use Cortech's  intellectual  property for a term of years, now
     expired,  to develop compounds for the amelioration of Chronic  Obstructive
     Pulmonary  Disorder,  referred  to  as  "COPD."  During  the  term  of  the
     agreement,  Ono had designated ONO-6818 as a "Developed  Compound," thereby
     giving  Ono exclusive rights  to  this  compound. In the arbitration, among

                                       6

<PAGE>

     other things,  Ono argued that it had the right to name 42 other  compounds
     as "Developed  Compounds"  giving it the same rights with respect to theses
     compounds as it had with respect to ONO-6818.  Cortech  argued that Ono was
     entitled  to  designate  only  one of  the 42  compounds  as a  back-up  to
     Ono-6818.  The  arbitration  panel  concurred with Cortech and provided Ono
     with 20 days to name one compound as the back-up.

          Ono also argued that 15 other  compounds were "Improved  Compounds" to
     which Ono was entitled to exclusive  rights for oral uses. The  Arbitration
     Panel determined that Ono had these exclusive rights. However, with respect
     to non-oral  uses of these 15 and other  "Improved  Compounds"  that may be
     developed in the future, the Panel agreed with Cortech that Cortech and Ono
     share  non-exclusive  rights throughout the world, but that Ono may develop
     these compounds only to the extent such  development  does not infringe any
     Cortech patent.

          Cortech  does not know  whether Ono intends to appeal the  decision of
     the arbitration panel.

3.   Related Party Transactions
     --------------------------

          A  management  fee of  $15,000  per month is paid to Asset  Value Fund
     Limited  Partnership  ("AVF") for  management  services  performed  for the
     Company.  Management  services  include,  among other things,  SEC filings,
     negotiation,   evaluating  merger  and  acquisition  proposals,  licensing,
     accounting  and  shareholder  relations.  The  Company  believes  that  the
     management fee is materially  less than the cost for the Company to perform
     these services.  AVF is the beneficial  owner of  approximately  43% of the
     Company's Common Stock at June 30, 2002.

4.   Stock Options
     -------------

          In 2001, 25,000  non-qualified stock options which had been granted in
     2000 were exercised for proceeds of $175,000.

5.   Common Stock
     ------------

          On May 14,  2001,  the Company  announced a 100% stock  dividend.  The
     record date for the stock  dividend  was May 22, 2001 and the  distribution
     date was June 1, 2001.  Accordingly,  all common share information has been
     restated to reflect this stock dividend.

          On October 30, 2000 the Board of Directors approved a stock repurchase
     program  authorizing  the Company to repurchase up to 320,000 shares of its
     Common  Stock at  prices  deemed  favorable  from  time to time in the open
     market  or  in  privately   negotiated   transactions   subject  to  market
     conditions,  the Company's financial position and other considerations.  As

                                       7
<PAGE>

     of June 30,  2002,  119,740  shares of Common  Stock have been  repurchased
     under this plan for  approximately  $444,000.  All shares  repurchased were
     returned to the status of authorized but unissued shares.

6.   Net Income (Loss) Per Share
     ---------------------------

          Basic net income  (loss) per share is computed by dividing  net income
     (loss) by the weighted-average number of common shares outstanding. Diluted
     net income  (loss) per share is computed by dividing  net income  (loss) by
     the sum of the  weighted-average  number of common shares  outstanding plus
     the  dilutive  effect of shares  issuable  through  the  exercise  of stock
     options.

          The  shares  used for basic  earnings  (loss)  per  share and  diluted
     earnings (loss) per share are reconciled below (in 000's).

<TABLE>
     <S>                                       <C>           <C>          <C>           <C>

                                               Three Months Ended          Six Months Ended
                                                    June 30,                   June 30,
                                               ------------------         ------------------
                                               2002          2001         2002          2001
                                               ----          ----         ----          ----

     Average shares outstanding for
       basic earnings (loss) per share         3,660        3,696        3,674         3,705

     Dilutive effect of stock options              -            -            -            21
                                               -----        -----        -----         -----

     Average shares outstanding for
       dilutive earnings (loss) per share      3,660        3,696        3,674         3,726
                                               =====        =====        =====         =====

</TABLE>



          Excluded from the  calculation of diluted loss per share for the three
     and six months ended June 30, 2002 are 310,000  common stock options which,
     if included, would have an antidilutive effect.

          Excluded from the  calculation of diluted loss per share for the three
     months  ended June 30,  2001 are 23,482  common  stock  options  which,  if
     included, would have an antidilutive effect.













                                       8

<PAGE>

ITEM 2.  Management's   Discussion  and  Analysis  of   Financial  Condition and
-------  -----------------------------------------------------------------------
         Results of Operations
         ---------------------

     The following  discussion and analysis  should be read in conjunction  with
Cortech,  Inc.'s  ("Cortech" or the "Company") 2001 Annual Report on Form 10-KSB
as well  as the  Company's  financial  statements  and  notes  thereto  included
elsewhere in this Quarterly Report on Form 10-QSB. When used in this discussion,
the  word   "expects"   and  similar   expressions   are  intended  to  identify
forward-looking   statements.   Such   statements   are  subject  to  risks  and
uncertainties  that could cause actual results to differ  materially  from those
projected. The forward-looking  statements contained herein speak only as of the
date hereof.  The Company  expressly  disclaims any obligation or undertaking to
release  publicly  any updates or revisions  to any  forward-looking  statements
contained herein to reflect any change in the Company's expectations with regard
thereto or any change in events,  conditions or  circumstances on which any such
statement is based.

General
-------

     Cortech  operated  as  a  biopharmaceutical   company  whose  research  and
development  efforts  focused  primarily on bradykinin  antagonists and protease
inhibitors.  Those  efforts  produced  a  technology  portfolio  which  may have
potential  therapeutic  application across a broad range of medical  conditions.
Cortech's strategy is to seek collaborative  partners to conduct and fund future
research and development on the components of its portfolio,  although there can
be no assurance  that any particular  agreement  will be completed.  At the same
time, the Company is seeking to redeploy its assets into an operating business.

Results of Operations
---------------------

Revenues
--------

     Cortech had a net loss of $646,000 or $.18 basic and fully diluted loss per
share for the quarter  ended June 30, 2002  compared to a net loss of $64,000 or
$.02 basic and fully  diluted loss per share for the same period in 2001.  There
was no net income for the six months ended June 30, 2001, compared to a net loss
of $1,064,000 or $.29 basic and fully diluted loss per share for the same period
in 2002.

     Interest  income was $56,000 and $112,000 in the three and six months ended
June 30,  2002,  respectively,  compared to $165,000  and  $357,000 for the same
periods in 2001,  a decrease of $109,000 and $245,000 in the three and six month
periods,  respectively.  Lower yields on investments and lower invested balances
were the primary reasons for this decrease.


                                       9

<PAGE>

Expenses
--------

     General and  administrative  expenses were  $702,000 and  $1,176,000 in the
three and six  months  ended  June 30,  2002,  respectively,  and  $225,000  and
$349,000 in the same periods in 2001, respectively,  an increase of $477,000 and
$827,000.  The increase was due principally to legal fees incurred in connection
with the Company's on-going  arbitration with Ono  Pharmaceutical  Co., Ltd (the
"Ono  Arbitration").  The Company  anticipates  continued  legal expenses in the
third quarter of 2002 in connection with this Arbitration.  For more information
on  the  Ono  Arbitration,   see  Part  II-Other  Information,   Item  1.  Legal
Proceedings.

Liquidity and Capital Resources
-------------------------------

     At  June  30,  2002,   the  Company  had  cash  and  cash   equivalents  of
approximately $12.5 million. Cash equivalents of $11.9 million consisted of U.S.
Treasury  Bills with an original  maturity  of three  months or less with yields
ranging  between  1.65%  and  1.73%.  Management  believes  its  cash  and  cash
equivalents  are  sufficient for its remaining  business  activities and for the
costs of seeking an acquisition of an operating business.

     Net cash of $744,000  was used by operating  activities  for the six months
ended June 30, 2002 compared to net cash used by operating activities of $22,000
for the same  period  in 2001.  In 2002,  cash  flows  caused by the net loss of
$1,064,000 offset by an increase in accrued liabilities were the primary reasons
for the cash used in operating activities.  In 2001, changes in other assets and
accrued liabilities were the reasons for the cash used.

     Net cash of $6.6 million was provided by  investing  activities  in the six
months ended June 30, 2001, due to the maturities of short-term investments.

     Net cash of $221,000  was used in  financing  activities  in the six months
ended June 30, 2002 due to the  repurchase of common stock.  Net cash of $48,000
was used in  financing  activities  in the six months ended June 30, 2001 due to
the  issuance  and   repurchase  of  common  stock  of  $175,000  and  $223,000,
respectively.

Factors Which May Affect Future Results
---------------------------------------

     Future  earnings of the Company are  dependent on interest  rates earned on
the  Company's  invested  balances and  expenses  incurred,  particularly  legal
expenses associated with the Ono Arbitration.



                                       10
<PAGE>

Other Disclosures - Related Party Transactions
----------------------------------------------

     A  management  fee of $15,000 per month is paid to Asset Value Fund Limited
Partnership   ("AVF")  for  management   services  performed  for  the  Company.
Management  services  include,  among other  things,  SEC filings,  negotiation,
evaluating  merger  and  acquisition   proposals,   licensing,   accounting  and
shareholder  relations.   The  Company  believes  that  the  management  fee  is
materially less than the cost for the Company to perform these services.  AVF is
the beneficial owner of approximately  43% of the Company's Common Stock at June
30, 2002.




















                                       11

<PAGE>

PART II  -  OTHER INFORMATION
-------     -----------------
ITEM 1.  -  LEGAL PROCEEDINGS
-------     -----------------

     The arbitration  previously disclosed,  against Ono Pharmaceutical Co., Ltd
("Ono"),  concluded in Agusut,  2002  resolving  any  questions  concerning  the
ownership of Cortech's intellectual property.

     Ono and Cortech are  parties to an  agreement  under which Ono paid for the
right to use Cortech's  intellectual  property for a term of years, now expired,
to develop  compounds  for the  amelioration  of Chronic  Obstructive  Pulmonary
Disorder,  referred  to as  "COPD."  During the term of the  agreement,  Ono had
designated  ONO-6818 as a "Developed  Compound,"  thereby  giving Ono  exclusive
rights to this compound. In the arbitration, among other things, Ono argued that
it had the right to name 42 other compounds as "Developed  Compounds"  giving it
the same  rights  with  respect to theses  compounds  as it had with  respect to
ONO-6818.  Cortech  argued that Ono was entitled to designate only one of the 42
compounds as a back-up to Ono-6818. The arbitration panel concurred with Cortech
and provided Ono with 20 days to name one compound as the back-up.

     Ono also argued that 15 other compounds were "Improved  Compounds" to which
Ono was  entitled  to  exclusive  rights for oral uses.  The  Arbitration  Panel
determined  that Ono had  these  exclusive  rights.  However,  with  respect  to
non-oral uses of these 15 and other  "Improved  Compounds" that may be developed
in the  future,  the  Panel  agreed  with  Cortech  that  Cortech  and Ono share
non-exclusive  rights  throughout  the  world,  but that Ono may  develop  these
compounds  only to the extent such  development  does not  infringe  any Cortech
patent.

     Cortech  does not know  whether Ono  intends to appeal the  decision of the
arbitration panel.

ITEM 4.  -  Submissions of Matters to a Vote of Security Holders
-------     ----------------------------------------------------

     The Company held its Annual  Meeting of  Stockholders  on May 16, 2002. The
Shareholders   voted  to  adopt  and  approve  an  amendment  to  the  Company's
Certificate  of  Incorporation  that would  declassify the Board of Directors so
that each director would stand for re-election on an annual basis. The following
is the vote tabulation:

        FOR              AGAINST              WITHHELD           NOT VOTED
        ---              -------              --------           ---------

     2,499,502            5,508                38,354             910,488




                                       12

<PAGE>

     Six Directors  were elected.  The  following is a vote  tabulation  for the
nominees:

         NOMINEE                        FOR                     WITHHELD
         -------                        ---                     --------

     Paul O. Koether                 3,446,248                    7,604
     James L. Bicksler               3,446,248                    7,604
     John W. Galuchie, Jr.           3,446,248                    7,604
     Sheri Perge Stettner            3,446,248                    7,604
     Leonard M. Tannenbaum           3,446,248                    7,604
     Qun Yi Zheng                    3,446,248                    7,604

     The    shareholders    also    voted   to   ratify   the    selection    of
PricewaterhouseCoopers  LLP as Independent  Auditors of the Company for the year
ended  December  31,  2002.   The  following  is  a  vote   tabulation  for  the
ratification.

       FOR                          AGAINST                        WITHHELD
       ---                          -------                        --------

    3,451,558                        1,188                           1,106

ITEM 6.  -  Exhibits and Reports on Form 8-K
-------     --------------------------------

      a.    Exhibits

            99.1  -  Certification  pursuant  to  18   U.S.C.  Section  1350  as
            adopted  pursuant  to Section 906 of  the Sarbanes-Oxley Act of 2002

      b.    Reports on Form 8-K

            No reports on Form 8-K were filed during the quarter for  which this
            report is being filed.























                                       13
<PAGE>

                                   SIGNATURES

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

                                              CORTECH, INC.



Date: August 14, 2002                         /s/ Sue Ann Itzel
                                              --------------------------------
                                              Sue Ann Itzel
                                              Treasurer
                                              (Principal Accounting
                                              and Financial Officer)




















                                       14