SECURITIES AND EXCHANGE COMMISSION

                              Washington, DC 20549

                                   FORM 10-QSB

              [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934
                  For the quarterly period ended March 31, 1997

                                       OR

             [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934
         For the transition period from _____________ to _______________

                           Commission file No. 0-15260

                                Biorelease Corp.
        (Exact name of small business issuer as specified in its charter)

   Delaware        88-0218411
(State or other jurisdiction of               (IRS Employer Identification No.)
incorporation or organization)


  10 Chestnut Drive #D, Bedford, NH                       03110
(Address of principal Executive offices)               (Zip Code)


                                 (603) 471-1255
                 Issuer's telephone number, including area code


    Former name,  former  address and formal  fiscal year, if changed since last
report.


    Indicate  by check mark  whether  the  registrant  (1) has filed all reports
required to be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of
1934  during  the  preceding  12 months  (or for such  shorter  period  that the
Registrant was required to file such reports),  and (2) has been subject to such
filing requiring for the past 90 days. Yes X No

    Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the last practicable date. 9,471,659 shares of common stock,
par value $.01 per share as of April 30, 1997.



    Transitional Small Business Disclosure Format (Check One)   Yes     No    X

<PAGE>

                                BIORELEASE CORP.

                                     INDEX

                                                                           Page
                                                                          Number
 PART I. FINANCIAL INFORMATION

 Item 1. Financial Statement

         Consolidated Balance Sheets as of March 31, 1997
         (unaudited) and June 30, 1996......................................   3
                                                                         

         Consolidated Statements of Operations for the 
         Three Months and the Nine Months ended
         March 31, 1997 (unaudited) and 1996 (unaudited),
         and from October 20, 1989 (inception) to 
         March 31, 1997 (unaudited).........................................   4

                                                                                

         Consolidated Statements of Cash Flows for the 
         Nine Months Ended March 31, 1997 (unaudited)
         and 1996  (unaudited),  and from October 20,
         1989 (inception) to March 31, 1997 (unaudited).....................   5

                                                                                

         Notes to Unaudited Financial Statements............................   7

Item 2 Management's Discussion and Analysis of Financial Condition and
       Results of Operations................................................   8
                                                                                

PART II. OTHER INFORMATION

Item 1. Legal Proceedings...................................................   9
Item 2. Changes in Securities...............................................   9
Item 3 Defaults Upon Senior Securities......................................   9
Item 4 Submission of Matters to a Vote of Security Holders..................   9
Item 5. Other Information...................................................   9
Item 6 Exhibits and Reports on Form 8-K.....................................   9


<PAGE>

PART I  FINANCIAL INFORMATION

ITEM 1  Financial Statements

<PAGE>
<TABLE>

<CAPTION>


                                BIORELEASE CORP.
                        (A DEVELOPMENT STAGE ENTERPRISE)
                           CONSOLIDATED BALANCE SHEETS
                        March 31, 1997 and June 30, 1996

                                                           March 31,    June 30,
                                                             1997        1996
                                                          (Unaudited) (Unaudited)
                                                          ----------- -----------
ASSETS
<S>                                                      <C>            <C>
Cash ..................................................   $    11,418   $      1,200
Accounts receivable ...................................        22,292            563
Inventories ...........................................        23,366         27,679
Other receivables .....................................            --             --
Prepaid expenses and other current assets..............         1,379          1,679
                                                             --------   ------------
Total current assets ..................................   $    58,455  $      31,121
Equipment and Leasehold improvements, net..............        21,587         30,040
Intangible assets, net ................................        29,029         38,947
Other noncurrent assets ...............................           698            699
                                                         ------------    -----------
Total assets ..........................................   $   109,769    $   100,807
                                                         ============    ===========

LIABILITIES AND STOCKHOLDERS' EQUITY

Accounts payable ......................................   $   123,169    $    90,637
Accrued expenses ......................................       108,892         70,642
Notes payable - stockholders, current .................        58,100         85,530
Loans payable - other .................................        27,500           --
Income taxes payable ..................................         1,549          1,549
Other current liabilities .............................         1,500          1,500
                                                          -----------    -----------
Total current liabilities .............................   $   320,710    $   249,858
Notes payable - stockholders, long term ...............        18,430           --
Notes payable - other, long term ......................        16,000         16,000
Other liabilities .....................................        87,734         87,734
                                                          -----------    -----------
Total liabilities .....................................   $   442,874    $   353,592
Stockholders' equity:
Common stock of $.01 par value ........................        99,217         98,803
Additional paid-in capital ............................     9,119,296      9,113,927
Stock warrants outstanding ............................            --             --
Development stage accumulated deficit .................    (9,497,118)    (9,411,015)
Stock subscription receivable .........................       (50,000)       (50,000)
                                                          ------------   ----------- 
                                                          $ ( 328,605)   $  (248,285)
Less: Treasury stock ..................................        (4,500)        (4,500)
                                                          -----------    ----------- 
Total stockholders' equity (deficit) ..................   $  (333,105)   $  (252,785)
                                                          -----------    ----------- 
Total liabilities and stockholders' equity (deficiency)   $   109,769    $   100,807
                                                          ===========    ===========
</TABLE>

                   The accompanying notes are an integral part
                   of the consolidated financial statements.

<PAGE>

<TABLE>

<CAPTION>

                                BIORELEASE CORP.
                        (A DEVELOPMENT STAGE ENTERPRISE)
                      CONSOLIDATED STATEMENTS OF OPERATIONS
       For the Three Months and Nine Months Ended March 31, 1997 and 1996
           and the Cumulative Period from Inception to March 31, 1997

                                                    Three Months Ended                Nine Months Ended                Inception
                                                          March 31,                        March 31,              (October 20, 1989)
                                                     1997           1996            1997            1996          to March 31, 1997
                                                 -----------    -----------    -----------       -----------          ----------- 
<S>                                             <C>             <C>            <C>              <C>                   <C> 

Revenues ......................................  $    41,534    $     1,500    $    87,185       $    63,983          $   474,297
Cost of Goods Sold ............................        3,772           --            4,313             3,073               19,610
                                                 -----------    -----------    -----------       -----------          ----------- 

Gross Profit ..................................  $    37,762    $     1,500    $    82,872       $    60,910          $   454,687
Operating Expenses:
Cell culture operations .......................         --             --             --                --               (601,116)
Research and development ......................         --             --             --             (25,000           (2,558,041)
Purchased technology ..........................         --             --             --                --               (690,000)
General and administrative ....................      (57,927)       (68,985)      (135,634)         (189,698)          (4,171,266)
Other .........................................         --             --             --                --                   --
                                                 -----------    -----------    -----------       -----------          ----------- 

Loss from operation ...........................  $   (20,165)   $   (67,485)   $   (52,762)      $  (153,788)         $(7,565,736)
                                                 -----------    -----------    -----------       -----------          ----------- 
Other costs:
Interest, net .................................  $      (981)   $    (1,249)   $    (2,943)      $    (3,654)              84,408
Lease commitment cost .........................         --             --             --                --               (315,000)
Litigation costs ..............................         --             --             --              (5,474)             (99,242)
Other income (costs) ..........................         --             --             --                --                (23,024)
Gain (Loss) on sale of assets .................         --           (2,700)          --              (1,600)              62,616
Offering costs ................................         --             --          (30,396)             --               (321,830)
Option compensation ...........................         --             --             --                --               (219,375)
Income recognized on settlements ..............         --             --             --              29,361              280,500
Realized loss for decline in investments ......         --             --             --                               (1,500,000)
                                                 -----------    -----------    -----------       -----------          ----------- 
Total Other Costs .............................  $      (981)   $    (3,949)   $   (33,339)      $    18,633          $(2,050,947)
                                                 -----------    -----------    -----------       -----------          ----------- 
Income (Loss) before  provision for 
(benefit from)income  taxes and  cumulative 
effect of change in  accounting  principle ...   $   (21,146)   $   (71,434)   $   (86,101)      $  (135,155)         $(9,616,683)
Provision (credit) for income taxes                                                                                        343,871
Income (Loss) before cumulative effect of 
accounting principle .........................       (21,146)       (71,434)       (86,101)         (135,155)          (9,960,554)
Cumulative effect of change in accounting 
  principle..................................                                                                             463,440
                                                  -----------    -----------    -----------       -----------         ------------
Net Income (Loss) ...........................    $   (21,146)   $   (71,434)   $   (86,101)      $  (135,155)         $(9,497,114)
                                                 ===========    ===========    ===========       ===========          =========== 
Weighted average shares .....................      9,471,659      8,962,263      9,476,159         8,962,263            5,414,876
Income (Loss) per share .....................          (0.01)         (0.01)         (0.01)            (0.02)               (1.75)


                   The accompanying notes are an integral part
                   of the consolidated financial statements.
<PAGE>

<CAPTION>

                                BIORELEASE CORP.
                        (A DEVELOPMENT STAGE ENTERPRISE)
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                     For the Three Months and Nine Months
                          Ended March 31, 1997 and 1996
           and the Cumulative Period from Inception to March 31, 1997
                                   (Unaudited)

                                                                      Nine Months Ended         Inception
                                                                           March 31,         (October 20, 1989)
                                                                     1997           1996      to March 31, 1997
                                                                     ----           ----      -----------------
<S>                                                             <C>            <C>            <C>  

Cash flows from operating activities:
Net Loss ....................................................   $   (86,101)   $  (135,155)   $(9,497,116)
Adjustments to reconcile net loss to net cash ...............          --             --             --
used in development activities: .............................          --             --             --
Depreciation and amortization ...............................        22,637         19,153        232,067
Cumulative effect of change in accounting principle .........          --             --         (463,440)
(Gain) Loss on sale of assets - .............................          --                         (38,704)
Recognized loss on investment ...............................          --             --        1,500,000
Loss on extinguishment of debt ..............................          --             --           42,000
Common stock issued in exchange for purchased technology ....          --             --          605,000
Common stock issued in exchange for services rendered .......          --             --           52,300
Common stock options issued in exchange for services rendered          --             --           89,228
Amortization of unearned compensation .......................          --             --          140,625
Repricing of A warrants .....................................          --             --           78,750
Changes in Current Assets: ..................................          --             --             --
Cash - escrow ...............................................          --             --             --
Accounts receivable .........................................       (21,729)        35,168        (22,292)
Other receivables ...........................................          --             --             --
Inventories .................................................         4,313          3,073        (23,366)
Prepaid expenses and other current assets ...................           300            787         (1,379)
Deferred tax asset ..........................................          --             --          463,440
Other non-current assets ....................................            (1)           403           (700)
Changes in current liabilities:
Accounts payable ............................................        32,532          5,111        194,120
Accrued expenses ............................................        38,250          9,811        116,720
Other current liabilities ...................................          --             --           90,783
                                                                -----------    -----------    -----------
Net cash used in operating activities .......................   $    (9,799)   $   (61,649)   $(6,441,964)
                                                                -----------    -----------    -----------
Cash flows from investing activities:
Purchase of government backed securities ....................   $      --      $      --      $(1,000,000)
                                                                -----------    -----------    -----------
Proceeds from collateralized mortgage obligations ...........          --             --        1,000,000
Purchase of fixed assets ....................................          --           (1,370)      (333,187)
Proceeds from sale of assets ................................          --             --          189,742
Purchase of intangible assets ...............................        (4,266)       (13,691)      (100,538)
                                                                -----------    -----------    -----------
Net cash used in investing activities .......................   $    (4,266)   $   (15,061)   $  (243,983)
                                                                -----------    -----------    -----------

               The accompanying notes are an integral part of the
                       consolidated financial statements.
<PAGE>
<CAPTION>


                                BIORELEASE CORP.
                        (A DEVELOPMENT STAGE ENTERPRISE)
                         CONSOLIDATED STATEMENTS OF CASH
                    FLOW For the Three Months and Nine Months
                          Ended March 31, 1997 and 1996
           and the Cumulative Period from Inception to March 31, 1997
                                   (Unaudited)

                                                                       Nine Months Ended         Inception
                                                                            March 31,        (October 20, 1989)
                                                                        1997         1996     to March 31, 1997
                                                                   -----------    -----------    -----------
<S>                                                               <C>            <C>           <C>   

Cash flows from financing activities:
Advances from stockholders ....................................   $      --      $      --      $   594,385
Payments of advances from stockholders ........................          --             --         (159,975)
Loans payable notes payable ...................................        27,500           --           27,500
Issuance of common stock, net .................................        (9,000)        (9,000)        92,530
Purchase of investments in issuance of common stock ...........         5,783           --        3,611,749
Notes receivable ..............................................          --           72,710     (1,500,000)
Recapitalization ..............................................          --             --        4,031,176
                                                                   -----------    -----------    -----------
Net cash provided by investing activities .....................   $    24,283    $    63,710    $ 6,697,365
                                                                   -----------    -----------    -----------
Net increase (decrease) in cash ...............................   $    10,218    $   (13,000)   $    11,418
                                                                                   
Cash at beginning of period ...................................         1,200         13,521           --
                                                                                                               
                                                                   -----------    -----------    -----------
Cash at end of period .........................................   $    11,418    $       521    $    11,418
                                                                  ===========    ===========    ===========


Supplemental  disclosure  of non-cash transactions:
Interest ......................................................   $     1,962    $      --      $    85,389  
Marketable securities acquired through issuance of common stock          --             --             --
Issuance of common stock for subscription receivable ..........          --             --           50,000
Liabilities repaid through issuance of common stock ...........   $     5,784    $      --      $   582,773

</TABLE>

               The accompanying notes are an integral part of the
                       consolidated financial statements.
                                                       
<PAGE>

                                BIORELEASE CORP.
                        (A DEVELOPMENT STAGE ENTERPRISE)
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
                For the Nine Months Ended March 31, 1997 and 1996
           and the Cumulative Period from Inception to March 31, 1997
                                   (Unaudited)

1.   Basis of presentation

     The  accompanying  unaudited  consolidated  financial  statements have been
     prepared in accordance with generally  accepted  accounting  principles for
     interim financial  information and with the instructions to Form 10-QSB and
     Item 310 of  Regulation  S-B.  Accordingly,  they do not include all of the
     information  and  footnotes  required  by  generally  accepted   accounting
     principles  for complete  consolidated  financial  statements and should be
     read in  conjunction  with the  Company's  audited  consolidated  financial
     statements  at and for the fiscal year ended June 30, 1996.  In the opinion
     of  management,  all  adjustments  (consisting  only  of  normal  recurring
     accruals)  considered necessary for a fair presentation have been included.
     Operating  results  for the  nine  months  ended  March  31,  1997  are not
     necessarily  indicative  of the results  that may be expected  for the year
     ended June 30, 1997.

2.   Loans  payable - During  the  previous  quarter,  a Private  Placement  was
     undertaken  by the Company to raise up to $500,000 in the form of unsecured
     notes from  accredited  individuals  relating  to a then  pending  business
     combination  between the Company and TheraMed Partners,  Inc.. On March 13,
     1997 the Company announced that TheraMed Partners, Inc. and the Company had
     terminated their previously  announced agreement to undertake this business
     combination  along with a related  spin-off of the  Subsidiary,  Biorelease
     Technologies,  Inc.  to the  Company's  stockholders.  As a  result  of the
     termination  of this  agreement,  the Company  immediately  terminated  the
     Private  Placement  and  offered  recision  rights to the  holders of these
     Private  Placement  subscription  notes.  As of March  31,  1997,  $87,500,
     representing all subscriptions  which the Company had accepted prior to the
     termination,   was  rescinded.  The  termination  agreement  with  TheraMed
     resulted  in the Company  borrowing  $27,500  from  TheraMed to be forgiven
     ratably  by  TheraMed  if and when  TheraMed  raises  up to  $550,000  from
     investors  over the five (5) calendar  quarters  following  the date of the
     termination agreement.


ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND 
         RESULTS OF OPERATIONS

Results of Operations

Three Months Ended March 31, 1997 and 1996

     For the three  months  ended  March 31,  1997 the  Company,  including  its
subsidiary  Biorelease  Technologies,  Inc. ("the  Subsidiary")  had revenues of
$41,534  ($21,534  from  Erythrogen(TM)   sales  and  $20,000  from  the  Baxter
cooperative  agreement),  cost of sales of $3,772,  no expenses for cell culture
operation,   no  research  and  development   expenses,  no  cost  for  purchase
technology,  general and administration expenses of $57,927 and interest expense
of $981 resulting in a net loss of $21,146  compared with the three months ended
March 31, 1996 in which the Company had revenues of $1,500,  costs of goods sold
of $0,  no  costs  of cell  culture  operations,  no  research  and  development
expenses,  administrative  and  general  costs of $68,985,  interest  expense of
$1,249,  and a loss on sale of  assets  of  $2,700  resulting  in a net  loss of
$71,434.

Nine Months Ended March 31, 1997, and 1996

     For the nine months  ended  March 31,  1997,  the  Company had  revenues of
$87,185,  cost of goods sold of $4,313,  no cell culture costs,  no research and
development  costs, no purchased  technology costs,  general and  administrative
costs of $135,634,  interest of $2,943,  offering costs of $30,396 and no income
taxes  resulting  in a net loss of $86,101 as compared to the nine months  ended
March 31, 1996 in which the Company had revenues of $63,983,  cost of goods sold
of $3,073, cell culture operation costs of $0, research and development costs of
$25,000,  purchased  technology costs of $0, general and administrative costs of
$189,698, interest expense of $3,654, settlement expense of $5,474, loss on sale
of assets of $1,600,  option  compensation  expense of $0, income  recognized on
settlements  of  $29,361  and  income  taxes  of $0  resulting  in a net loss of
$135,155.  The decrease in net loss over the previous  fiscal year's nine months
resulted primarily from the reduction of administrative costs.

Liquidity and Capital Resources

     At March 31, 1997, the Company had negative  working capital of $262,255 as
compared with the  Company's  negative  working  capital of $218,737 at June 30,
1996.  The change in the  Company's  working  capital  between June 30, 1996 and
March 31, 1997 is attributable to operating expenses in excess of revenues,  net
of settlements.

     With the  termination  of the TheraMed  business  combination,  the Company
expects to operate  within the limited cash flow  generated by its product sales
and its licensing  revenue for the remainder of this fiscal year. In this scaled
back configuration, the Company will focus on prepaid research at the University
of New Hampshire and limited outside  research to available  cash.  Depending on
results of this  limited  research,  the  Company  may be in a position to raise
additional funds within the next several quarters.

 Dividend Policy


     The Company  has not  declared or paid any  dividends  on its common  stock
since its inception and does not anticipate  the  declaration or payment of cash
dividends in the foreseeable future. The Company intends to retain earnings,  if
any, to finance the development  and expansion of its business.  Future dividend
policy will be subject to the  discretion  of the Board of Directors and will be
contingent  upon future  earnings,  if any, the Company's  financial  condition,
capital requirements,  general business condition and other factors.  Therefore,
there can be no assurance that dividends of any kind will ever be paid.

Effect of Inflation

     Management  believes that  inflation  has not had a material  effect on its
operations for the periods presented.

<PAGE>

                                     PART II

                                OTHER INFORMATION

Item 1.   Legal Proceedings.
                None.
Item 2.   Changes in Securities.
                None.
Item 3.   Defaults Upon Senior Securities.
                None.
Item 4.   Submission of Matters to a Vote of Securities Holders.
                None.
Item 5.   Other Information.

          On October 8, 1996 the Company announced it had agreed in principle to
          enter into a  reorganization  with  TheraMed  Partners,  Inc.  Between
          November,  1996  and  January,  1997 the  Company  placed  $87,500  in
          Subscription   Notes  under  a  Private   Placement  related  to  this
          reorganization.  On  March  13,  1997  the  Company  announced  it had
          terminated  this  agreement and  rescinded  $87,500  representing  the
          entirety of  subscriptions  accepted by the Company  under the Private
          Placement.  Further,  on February 12, 1997, the Company announced that
          Dr.  Leon Gauci had assumed the role of  President  of the  Subsidiary
          (Biorelease Technologies, Inc.).

Item 6.   Exhibits and Reports of Form 8-K
    None


                                    SIGNATURE

    Pursuant  to the  requirements  of  Section  13 or 15(d)  of the  Securities
Exchange Act of 1934, as amended,  the Registrant has duly caused this report to
be signed on its behalf by the undersigned, thereunto duly authorized.

    BIORELEASE CORP.



March 14, 1997    By:  /s/ Richard F. Schubert 
                      --------------------------------------
                           Richard F. Schubert, Chairman and
                           Principal Financial Officer