<PAGE>   1

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-Q

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

FOR THE PERIOD ENDED JUNE 30, 1998                COMMISSION FILE NUMBER 0-10763


                               ATRION CORPORATION
             (Exact Name of Registrant as Specified in its Charter)


          DELAWARE                                               63-0821819
-------------------------------                              -------------------
(State or Other Jurisdiction of                               (I.R.S. Employer 
 Incorporation or Organization)                              Identification No.)

                    ONE ALLENTOWN PARKWAY, ALLEN, TEXAS 75002
               ---------------------------------------------------
               (Address of Principal Executive Offices) (Zip Code)

                                 (972) 390-9800
                                 --------------
              (Registrant's Telephone Number, Including Area Code)

Indicate by check whether the registrant: (1) has filed all reports required to
be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.

                YES    X                            NO
                    -------                            -------

Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.

                                              NUMBER OF SHARES OUTSTANDING AT
         TITLE OF EACH CLASS                          JUNE 30, 1998
---------------------------------------   --------------------------------------
COMMON STOCK, PAR VALUE $0.10 PER SHARE                  3,201,645



<PAGE>   2

                       ATRION CORPORATION AND SUBSIDIARIES

                                TABLE OF CONTENTS


<TABLE>
<S>                                                                         <C>
PART I.  FINANCIAL INFORMATION                                                2

   ITEM 1.  Financial Statements

               Consolidated Statements of Income (Unaudited)
                  For the Three Months and Six Months Ended
                  June 30, 1998 and 1997                                      3


               Consolidated Balance Sheets (Unaudited)
                  June 30, 1998 and December 31, 1997                        4-5


               Consolidated Statements of Cash Flows (Unaudited)
                  For the Six Months Ended
                  June 30, 1998 and 1997                                      6


               Notes to Consolidated Financial Statements (Unaudited)         7

   ITEM 2.  Management's Discussion and Analysis of
               Financial Condition and Results of
               Operations                                                     9

PART II. OTHER INFORMATION

   ITEM 4.  Submission of Matters to a Vote of Security Holders              13

   ITEM 6.  Exhibits and Reports on
               Form 8-K                                                      14

SIGNATURES                                                                   15
</TABLE>


                                       1
<PAGE>   3


                                     PART I


                              FINANCIAL INFORMATION


                                       2
<PAGE>   4

                       ATRION CORPORATION AND SUBSIDIARIES
                        CONSOLIDATED STATEMENTS OF INCOME
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                             THREE MONTHS ENDED                      SIX MONTHS ENDED
                                                                   JUNE 30                                JUNE 30
                                                      ----------------------------------    ----------------------------------
                                                           1998               1997               1998              1997
                                                      ---------------- -----------------    ----------------- ----------------
                                                     (In thousands, except per share data) (In thousands, except per share data)
<S>                                                  <C>               <C>                 <C>                <C>     
Revenues                                                 $ 11,375           $  8,138           $ 21,537           $ 16,083
Cost of goods sold                                          6,740              5,073             13,167             10,176
                                                         --------           --------           --------           --------
Gross profit                                                4,635              3,065              8,370              5,907
                                                         --------           --------           --------           --------

Operating expenses:
   Selling expense                                          1,382                542              2,344              1,103
   General and administrative                               1,811              1,552              3,452              3,151
   Research and development                                   736                294              1,289                485
                                                         --------           --------           --------           --------
                                                            3,929              2,388              7,085              4,739
                                                         --------           --------           --------           --------

Operating income                                              706                677              1,285              1,168
                                                         --------           --------           --------           --------

Other income (expense):
   Interest income (expense), net                             137                 35                330                (93)
   Other income                                                12                130                 40                163
                                                         --------           --------           --------           --------
                                                              149                165                370                 70
                                                         --------           --------           --------           --------

Income from continuing operations before
    provision for income taxes                                855                842              1,655              1,238
Provision for income taxes                                    318                327                620                482
                                                         --------           --------           --------           --------

Income from continuing operations                             537                515              1,035                756

Income from discontinued operations,
    net of income taxes                                        --                550                 --              1,941
Gain on disposal of discontinued operations,
    net of income taxes                                        --             17,002                 --             17,002
                                                         --------           --------           --------           --------

Net income                                               $    537           $ 18,067           $  1,035           $ 19,699
                                                         ========           ========           ========           ========

Earnings per basic share:
   Continuing operations                                 $   0.17           $   0.16           $   0.32           $   0.24
   Discontinued operations                                     --               0.17                 --               0.60
   Gain on disposal of discontinued operations                 --               5.30                 --               5.29
                                                         --------           --------           --------           --------
                                                         $   0.17           $   5.63           $   0.32           $   6.13
                                                         ========           ========           ========           ========

Weighted average basic shares outstanding                   3,202              3,207              3,218              3,211
                                                         ========           ========           ========           ========

Earnings per diluted share:
   Continuing operations                                 $   0.17           $   0.16           $   0.32           $   0.23
   Discontinued operations                                     --               0.17                 --               0.60
   Gain on disposal of discontinued operations                 --               5.26                 --               5.24
                                                         --------           --------           --------           --------
                                                         $   0.17           $   5.59           $   0.32           $   6.07
                                                         ========           ========           ========           ========

Dividends per share                                      $   0.00           $   0.20           $   0.00           $   0.40
                                                         ========           ========           ========           ========

Weighted average diluted shares outstanding                 3,203              3,234              3,220              3,243
                                                         ========           ========           ========           ========
</TABLE>

The accompanying notes to consolidated financial statements are in integral part
of these statements.


                                       3
<PAGE>   5

                       ATRION CORPORATION AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                       JUNE 30,   DECEMBER 31,
                                                        1998         1997
ASSETS                                                 --------   ------------
------                                                    (In thousands)
<S>                                                    <C>        <C>
Current assets:
   Cash and cash equivalents                           $ 7,846       $32,172
   Accounts receivable                                   6,689         2,897
   Inventories                                           8,302         3,960
   Prepaid expenses and other                              909           337
                                                       -------       -------
                                                        23,746        39,366
                                                       -------       -------

Property, plant and equipment:
   Original cost                                        21,008        15,617
   Less accumulated depreciation and amortization        3,608         2,475
                                                       -------       -------
                                                        17,400        13,142
                                                       -------       -------

Deferred charges:
   Patents                                               3,743           908
   Goodwill                                             14,116         4,862
   Other                                                 2,600         2,664
                                                       -------       -------
                                                        20,459         8,434
                                                       -------       -------

                                                       $61,605       $60,942
                                                       =======       =======
                                                            (Continued)
</TABLE>

The accompanying notes to consolidated financial statements are in integral part
of these statements.


                                       4
<PAGE>   6

                       ATRION CORPORATION AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                                   (UNAUDITED)

<TABLE>
                                                             JUNE 30,      DECEMBER 31,
                                                               1998            1997
LIABILITIES AND STOCKHOLDERS' EQUITY                         --------      ------------
------------------------------------                              (In thousands) 
<S>                                                          <C>           <C>
Current liabilities:
   Current maturities of long-term debt                      $    203        $    453
   Accounts payable and accrued liabilities                     5,473           5,320
                                                             --------        --------
                                                                5,676           5,773
                                                             --------        --------

Long-term debt, less current maturities                           102             203
                                                             --------        --------

Other noncurrent liabilities                                    5,271           4,980
                                                             --------        --------

Stockholder's equity:
   Common shares, par value $0.10 per share; authorized
      10,000,000 shares, issued 3,419,953 shares                  342             342
   Paid-in capital                                              6,403           6,395
   Retained earnings                                           45,716          44,681
   Treasury shares, at cost                                    (1,905)         (1,432)
                                                             --------        --------
       Total stockholders' equity                              50,556          49,986
                                                             --------        --------

                                                             $ 61,605        $ 60,942
                                                             ========        ========
</TABLE>

The accompanying notes to consolidated financial statements are in integral part
of these statements.


                                       5

<PAGE>   7

                       ATRION CORPORATION AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                            SIX MONTHS ENDED
                                                                                 JUNE 30
                                                                         -----------------------
                                                                           1998           1997
                                                                         --------       --------
                                                                             (In thousands)
<S>                                                                      <C>            <C>
Cash flows from operating activities:
   Net income                                                            $  1,035       $ 19,699
   Adjustments to reconcile net income to
      net cash provided by operating activities:
        Income from discontinued operations                                    --         (1,941)
        Gain on disposal of discontinued operations                            --        (17,002)
        Depreciation and amortization                                       1,572            955
        Deferred income taxes                                                 242             31
        Other                                                                 107           (182)
                                                                         --------       --------
                                                                            2,956          1,560

        Change in current assets and liabilities:
           (Increase) in accounts receivable                               (1,710)          (497)
           (Increase) in other current assets                                (931)          (336)
           Increase (decrease) in accounts payable                            760            (23)
           Increase (decrease) in other current liabilities                  (526)           505
                                                                         --------       --------
   Net cash provided by continuing operations                                 549          1,209
   Net cash provided by discontinued operations                              (168)           379
                                                                         --------       --------
                                                                              381          1,588
                                                                         --------       --------

Cash flows from investing activities:
  Property, plant and equipment additions - continuing operations            (692)          (646)
  Property, plant and equipment additions - discontinued operations
                                                                               --            (78)
  Acquisition of subsidiary                                               (23,198)            --
  Proceeds from disposal of discontinued operations                            --         39,373
  Other                                                                        --              8
                                                                         --------       --------
                                                                          (23,890)        38,657
                                                                         --------       --------

Cash flows from financing activities:
  Increase (decrease) in long-term indebtedness                              (352)        (6,009)
  Cash dividends paid                                                          --         (1,284)
  Issuance of common stock                                                     20             10
  Repurchase of common stock                                                 (485)          (126)
                                                                         --------       --------
                                                                             (817)        (7,409)

Net increase in cash and cash equivalents                                 (24,326)        32,836
Cash and cash equivalents at beginning of period                           32,172            144
                                                                         --------       --------
Cash and cash equivalents at end of period                               $  7,846       $ 32,980
                                                                         ========       ========

Cash paid for:
Interest (net of capitalized amounts)                                    $     15       $    251
Income taxes (net of refunds)                                            $     44       $  2,015
</TABLE>


The accompanying notes to consolidated financial statements are in integral part
of these statements.


                                       6

<PAGE>   8

                       ATRION CORPORATION AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)

(1)      BASIS OF PRESENTATION
         In the opinion of management, all adjustments necessary for a fair
         presentation of results of operations for the periods presented have
         been included in the accompanying unaudited consolidated financial
         statements of Atrion Corporation (the "Company"). Such adjustments
         consist of normal recurring items. The accompanying financial
         statements have been prepared in accordance with the instructions to
         Form 10-Q and include the information and notes required by such
         instructions. Accordingly, the consolidated financial statements and
         notes thereto should be read in conjunction with the financial
         statements and notes included in the Company's 1997 Annual Report on
         Form 10-K.

(2)      PURCHASE OF CERTAIN QUEST MEDICAL, INC. ASSETS.
         On January 30, 1998, the Company, through a wholly owned Texas
         subsidiary then known as "QMI Medical, Inc.", acquired certain assets
         of Quest Medical, Inc. (including all rights to the name "Quest
         Medical, Inc.") pursuant to the terms of an Asset Purchase Agreement,
         dated as of December 29, 1997. The Company paid $22,922,028 (after
         taking into account certain postclosing adjustments and excluding
         $276,445 of related acquisition costs) in cash under the Asset Purchase
         Agreement. This acquisition was accounted for using the purchase method
         of accounting and, accordingly, the results of operations relating to
         those assets prior to the acquisition date have not been included in
         the Company's financial statements for the 1998 year-to-date period.
         The Company recently changed the name of QMI Medical, Inc. to "Quest
         Medical, Inc." and that subsidiary is herein referred to as "Quest."

         The following table presents unaudited consolidated selected financial
         data on a pro forma basis assuming the purchase of these assets had
         occurred as of January 1, 1997. The unaudited consolidated pro forma
         data reflect certain assumptions, which are based on estimates. The
         unaudited consolidated pro forma combined results presented have been
         prepared for comparative purposes only and are not necessarily
         indicative of actual results that would have been achieved had the
         acquisition occurred at the beginning of the period presented, or of
         future results.

<TABLE>
<CAPTION>
                                                       THREE MONTHS ENDED
                                                            JUNE 30
                                                      --------------------
                                                        1998        1997
                                                      -------      -------
<S>                                                   <C>          <C>    
       Revenues from continuing operations (000)      $11,375      $11,813
       Income from continuing operations (000)        $   537      $   449
       Net income (000)                               $   537      $18,000
       Net income per basic share                     $  0.17      $  5.61
       Net income per diluted share                   $  0.17      $  5.57
</TABLE>

<TABLE>
<CAPTION>
                                                        SIX MONTHS ENDED
                                                            JUNE 30
                                                      --------------------
                                                        1998        1997
                                                      -------      -------
<S>                                                   <C>          <C>    
       Revenues from continuing operations (000)      $22,658      $23,292
       Income from continuing operations (000)        $ 1,058      $   506
       Net income (000)                               $ 1,058      $19,449
       Net income per basic share                     $  0.33      $  6.06
       Net income per diluted share                   $  0.33      $  6.00
</TABLE>


                                       7
<PAGE>   9

                       ATRION CORPORATION AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)

         For further information regarding the acquisition of these assets,
         refer to the Company's Report on Form 8-K, filed with the Securities
         and Exchange Commission on February 17, 1998, as amended on April 15,
         1998.


                                       8
<PAGE>   10

                       ATRION CORPORATION AND SUBSIDIARIES
                      MANAGEMENT'S DISCUSSION AND ANALYSIS
                OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

         RESULTS FOR THE THREE MONTHS ENDED JUNE 30, 1998

         The Company's consolidated net income from continuing operations for
         the quarter ended June 30, 1998 was $537,000, or $.17 per basic and
         diluted share, compared with $515,000, or $.16 per basic and diluted
         share, for the second quarter of 1997. The earnings per basic share
         computations are based on weighted average basic shares outstanding of
         3,201,645 in 1998 and 3,206,674 in 1997. The earnings per diluted share
         computations are based on weighted average diluted shares outstanding
         of 3,202,623 in 1998 and 3,234,122 in 1997.

         Consolidated revenues of $11.4 million from continuing operations for
         the second quarter of 1998 were $3.2 million or 40 percent higher than
         revenues for the second quarter of 1997. The increase in revenues in
         the second quarter of 1998, compared to the same period in the prior
         year, was a result of the inclusion of the operations of Quest for the
         1998 period. Gross profit of $4.6 million in the second quarter of 1998
         was $1.6 million or 51 percent higher than that in the comparable
         period of 1997 primarily due to the inclusion of the operations of
         Quest in the current year period. The gross profit percentage in the
         second quarter of 1998 of 41 percent is higher than the gross profit
         percentage in the second quarter of 1997 of 38 percent due to the
         inclusion of the operations of Quest in the 1998 period. Quest
         generally has a higher gross profit percentage on sales than the
         Company's other operations.

         The Company's operating expenses of $3.9 million for the second quarter
         of 1998 were $1.5 million higher than operating expenses for the second
         quarter of 1997. This increase is primarily a result of the inclusion
         of the operating expenses of Quest in the 1998 period. Operating income
         in the second quarter of 1998 totaled $706,000 compared with $677,000
         in 1997.

         The Company believes that its revenues from continuing operations, cost
         of goods sold, gross profit and operating expenses for the third and
         fourth quarters of 1998 will be materially greater than those reported
         for the same quarters last year (excluding the fourth quarter 1997
         impairment loss) as a result of the inclusion of Quest's operations.
         The increase in operating expenses for those quarters is expected to
         result from the inclusion of Quest's operations at approximately the
         level of operating expenses associated with Quest's product lines prior
         to acquisition plus additional SG&A expenses associated with a planned
         expansion of Quest's marketing organization and additional R&D expense
         associated with planned enhancements to certain of Quest's product
         lines. The Company anticipates that operating income for the third
         quarter of 1998 will be at or below the Company's operating income in
         the same quarter in 1997 as a result of the additional SG&A and R&D
         expenses described above. The Company expects to report operating
         income, even after taking into account the additional SG&A and R&D
         expenses described above, for the fourth quarter of 1998. This compares
         with the operating loss in the fourth quarter of 1997 primarily
         resulting from significant nonrecurring charges.

         Net interest income of $137,000 in the second quarter of 1998 was
         $102,000 higher than net interest income in the same period in the
         prior year. The net interest income amount in 


                                       9
<PAGE>   11

         1998 reflects interest earned on the proceeds from the sale of the
         Company's natural gas subsidiaries in May 1997 (as reduced in late
         January 1998 for the purchase of assets now held by Quest). Other
         income in the second quarter of 1998 of $12,000 was $118,000 lower than
         the second quarter of 1997 primarily as a result of a one-time gain
         during the 1997 period.

         As a result of the additional SG&A and R&D expenses described above,
         the Company expects that net income from continuing operations for the
         third quarter of 1998 will be at or below the net income for the same
         period of 1997. The Company expects to report net income from
         continuing operations, even after taking into account the additional
         SG&A and R&D expenses described above, for the fourth quarter of 1998.
         This compares with the net loss from continuing operations in the
         fourth quarter of 1997 primarily resulting from significant
         nonrecurring charges.

         The Company recorded income from discontinued operations in the second
         quarter of 1997 of $550,000 or $.17 per basic and diluted share. The
         Company also recorded a gain on the disposal of discontinued operations
         relating to the sale of its natural gas subsidiaries of $17 million, or
         $5.30 per basic share and $5.26 per diluted share, in the second
         quarter of 1997. There was no similar transaction during the second
         quarter of 1998.

         RESULTS FOR THE SIX MONTHS ENDED JUNE 30, 1998

         The Company's consolidated net income from continuing operations for
         the six-month period ended June 30, 1998 was $1.0 million, or $.32 per
         basic and diluted share, compared with $756,000, or $.24 per basic
         share and $.23 per diluted share, for the first six months of 1997. The
         earnings per basic share computations are based on weighted average
         basic shares outstanding of 3,217,939 in 1998 and 3,211,005 in 1997.
         The earnings per diluted share computations are based on weighted
         average diluted shares outstanding of 3,220,152 in 1998 and 3,242,787
         in 1997.

         Consolidated revenues of $21.5 million from continuing operations for
         the six months ended June 30, 1998 were $5.4 million or 34 percent
         higher than revenues for the six months ended June 30, 1997. The
         increase in revenues for the first six months of 1998, compared to the
         same period in the prior year, was primarily a result of the inclusion
         of the operations of Quest for five months in the current year period.
         Gross profit of $8.4 million for the first six months of 1998 was $2.5
         million or 42 percent higher than that in the comparable period of 1997
         primarily due to the inclusion of the operations of Quest in the
         current year period. The gross profit percentage for the first six
         months of 1998 of 39 percent is higher than the gross profit percentage
         in the same period of 1997 of 37 percent due to the inclusion of the
         operations of Quest in the 1998 period. Quest generally has a higher
         gross profit percentage on sales than the Company's other operations.

         The Company's operating expenses of $7.1 million for the first six
         months of 1998 were $2.3 million higher than operating expenses for the
         first six months of 1997. This increase is primarily a result of the
         inclusion of the operating expenses of Quest in the 1998 period.
         Operating income in the six months ended June 30,1998 totaled $1.3
         million compared with $1.2 million in the same period of 1997.


                                       10
<PAGE>   12

         Net interest income of $330,000 in the first six months of 1998 was
         $423,000 higher than interest expense in the same period in the prior
         year. Net interest income in the 1998 period reflects interest earned
         on the proceeds from the sale of the Company's natural gas subsidiaries
         in May 1997 (as reduced in late January 1998 for the purchase of assets
         now held by Quest). Other income for the six-month period ended June
         30,1998 of $40,000 was $123,000 lower than other income for the same
         period of 1997 primarily as a result of a one-time gain during the 1997
         period.

         The Company recorded income from discontinued operations in the
         six-month period ended June 30,1997 of $1.9 million or $.60 per basic
         and diluted share. The Company also recorded a gain on the disposal of
         discontinued operations relating to the sale of its natural gas
         subsidiaries of $17 million, or $5.29 per basic share and $5.24 per
         diluted share, for the six months ended June 30,1997. There was no
         similar transaction during the same period of 1998.

         LIQUIDITY AND CAPITAL RESOURCES

         At June 30, 1998, the Company had cash and cash equivalents of $7.8
         million compared with $32.2 million at December 31, 1997. The asset
         acquisition in January 1998 used approximately $23.2 million of the
         Company's existing cash balance. The Company believes that its
         remaining cash and cash equivalents, cash flows from operations,
         borrowings available under the Company's revolving loan agreement and
         other equity and debt financing, which the Company believes would be
         available if needed, would be sufficient to fund operations, including
         the Company's previously announced increase of $1.5 to $2.0 million in
         annual SG&A and R&D expenses which is currently being implemented in
         connection with the expansion of certain of the Company's product lines
         and of the Company's marketing organization, potential projects, and
         budgeted capital expenditures over the next two years.

         In January 1998, the Board of Directors discontinued the payment of
         quarterly cash dividends. Such action was taken to facilitate the
         Company's growth strategy as well as to bring the Company's dividend
         policy more in line with other companies in the medical products
         industry.

         YEAR 200 ISSUES

         The Company is taking action to assess the nature and extent of the
         work required to make its information systems, products, facilities and
         equipment Year 2000 ready. The Company's operating units are currently
         using several different information systems. As a part of the Company's
         ongoing efforts to achieve operating synergies, the Company is
         reviewing various measures to integrate and update its information
         systems and, in connection therewith, is also seeking to determine
         which systems are Year 2000 compliant and whether updated or
         replacement systems will be Year 2000 ready. The Company is also
         contacting suppliers to determine whether they are Year 2000 compliant
         and, if not, intends to monitor their progress and take appropriate
         actions. In addition, the Company has reviewed its products that
         process information that may be date sensitive and believes that those
         products are not Year 2000 sensitive products. The Company's facilities
         and equipment are also being examined to determine whether they are
         Year 2000 ready. The Company has not completed its assessment of its
         information systems, products, facilities and equipment and,
         accordingly, has not determined the costs associated with its efforts
         to 


                                       11
<PAGE>   13

         prepare for Year 2000. However, the Company currently believes that the
         costs of addressing its Year 2000 transition will not have a material
         adverse effect on the Company's financial condition or business
         operations. Given the uncertain consequences of failure to resolve
         significant Year 2000 issues, however, there is no assurance that any
         one or more of such failures would not have a material adverse impact
         on the Company. The Company has not yet developed a contingency plan
         addressing failure to be Year 2000 ready.

         FORWARD-LOOKING STATEMENTS

         The statements in this Management's Discussion and Analysis that are
         forward-looking are based upon current expectations, and actual results
         may differ materially. Therefore, the inclusion of such forward-looking
         information should not be regarded as a representation by the Company
         that the objectives or plans of the Company would be achieved. Such
         statements include, but are not limited to, the Company's expectations
         regarding future revenues, future cost of sales, future gross profit
         and gross profit percentage, future expenses, future operating income
         and net income, future liquidity and capital resources and Year 2000
         compliance and impact. Words such as "anticipates," "believes,"
         "expects," "estimated" and variations of such words and similar
         expressions are intended to identify such forward-looking statements.
         Forward-looking statements contained herein involve numerous risks and
         uncertainties, and there are a number of factors that could cause
         actual results to differ materially including, but not limited to, the
         following: changing economic, market and business conditions, the
         effects of governmental regulation, the impact of competition and new
         technologies, slower-than-anticipated introduction of new products or
         implementation of marketing strategies, changes in the prices of raw
         materials, the ability to attract and retain qualified personnel and
         the loss of any significant customer. In addition, assumptions relating
         to budgeting, marketing, product development and other management
         decisions are subjective in many respects and thus susceptible to
         interpretations and periodic review which may cause the Company to
         alter its marketing, capital expenditures or other budgets, which in
         turn may affect the Company's results of operations and financial
         condition.


                                       12

<PAGE>   14

                                     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 SECURITY HOLDERS

         The Company held its 1998 Annual Meeting of Stockholders ("Annual
         Meeting") on May 12, 1998 at the Company's corporate office in Allen,
         Texas. The stockholders voted to approve certain amendments to the
         Company's 1997 Stock Incentive Plan with 1,436,167 shares voted for the
         approval, 638,320 shares voted against, 33,561 abstentions and 476,324
         broker nonvotes. At such meeting, the Company's stockholders also voted
         to approve the Company's 1998 Outside Director Stock Option Plan with
         1,551,561 shares voted for the approval of the plan, 505,214 shares
         voted against the plan, 28,289 abstentions and 499,358 broker nonvotes.
         At such meeting, the Company's stockholders also ratified the Board of
         Director's appointment of Arthur Andersen LLP as independent
         accountants with 2,559,783 shares voted for ratification, 10,252 voted
         against and 14,337 abstentions. The voting with respect to the nominees
         for election as directors was as follows:

<TABLE>
<CAPTION>
               NOMINEE                           VOTES FOR             VOTES WITHHELD
               -------                           ---------             --------------
            <S>                                  <C>                       <C>   
            Jerry A. Howard                      2,521,159                 63,213
            Roger F. Stebbing                    2,521,459                 62,913
            John P. Stupp, Jr.                   2,521,459                 62,913
</TABLE>

         The terms of the following directors continued after the meeting: Emile
         A. Battat, John H. P. Maley, J. Kenneth Smith, Richard O. Jacobson,
         Jerome J. McGrath and Hugh J. Morgan, Jr.


                                       13
<PAGE>   15

ITEM 5.  OTHER INFORMATION

         None

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

         (a)    Exhibits
                Exhibit 27--Financial Data Schedules (filed electronically only)

         (b)    Reports on Form 8-K

                (1)     The Company filed a current report on Form 8-K/A,
                        Amendment No. 1 to Form 8-K, dated April 15, 1998 which
                        amended Item 7. "Financial Statements, Pro Forma
                        Financial Information and Exhibits" of the Company's
                        Form 8-K dated February 17, 1998. This amendment to Form
                        8-K provided the financial statements of Quest Medical,
                        Inc. CVS Operations and the required pro forma financial
                        information.


                                       14
<PAGE>   16

                                   SIGNATURES


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



                               Atrion Corporation
                               ------------------
                                  (Registrant)


         Date:  August 14, 1998                          /s/ Jerry A. Howard
                                                         -----------------------
                                                         Jerry A. Howard
                                                         President and
                                                         Chief Executive Officer


         Date:  August 14, 1998                          /s/ Jeffery Strickland
                                                         -----------------------
                                                         Jeffery Strickland
                                                         Vice President and
                                                         Chief Financial Officer


                                       15