SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549


                                    FORM 10-Q


   X     Quarterly  report  pursuant  to  Section 13 or 15(d) of the  Securities
-------- Exchange Act of 1934

         For the quarterly  period ended October 2, 1999  Commission File Number
         0-27050
         -------

         Transition  report  pursuant  to Section 13 or 15(d) of the  Securities
-------- Exchange Act of 1934 For the transition period from________ to ________


                                 PHAR-MOR, INC.
--------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)

         PENNSYLVANIA                                          25-1466309
------------------------------------------------           ---------------------
         (State or other jurisdiction of                   (I.R.S. Employer
         incorporation or organization)                    Identification No.)


         20 Federal Plaza West, Youngstown, Ohio            44501-0400
------------------------------------------------           ---------------------
         (Address of principal executive offices)          (Zip code)


Registrant's telephone number, including area code:        (330) 746-6641
                                                           --------------

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

                                            YES      X        No
                                                   -----           -----

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

                                            YES      X        No
                                                   -----           -----


As of October 20, 1999,  12,240,865 shares of the registrant's common stock were
outstanding .



<PAGE> 2


                         PHAR-MOR, INC. AND SUBSIDIARIES

                                    FORM 10-Q

                      FOR THE QUARTER ENDED OCTOBER 2, 1999


                                    I N D E X


                                                                           Page

Part I:  Financial Information

         Item 1.  Financial Statements

            Condensed  Consolidated  Balance Sheets as of October
            2, 1999 and July 3, 1999                                          3

            Condensed  Consolidated   Statements  of  Operations  for  the
            Thirteen Weeks Ended October 2, 1999 and September 26, 1998       4

            Condensed  Consolidated  Statements of Comprehensive  Loss for
            the Thirteen  Weeks Ended  October 2, 1999 and  September  26,
            1998                                                              5

            Condensed  Consolidated  Statements  of  Cash  Flows  for  the
            Thirteen Weeks Ended October 2, 1999 and September 26, 1998       6

            Notes to  Condensed  Consolidated  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                                          11

         Item 2.  Changes in Securities                                      11

         Item 3.  Defaults Upon Senior Securities                            11

         Item 4.  Submission of Matters to a Vote of Security Holders        11

         Item 5.  Other Information                                          11

         Item 6.  Exhibits and Reports on Form 8-K                           12

         Signatures                                                          13

         Exhibit Index                                                       14


<PAGE> 3


                         PHAR-MOR, INC. AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEETS
                                 (In thousands)
<TABLE>
<CAPTION>


ASSETS                                                            (Unaudited)
                                                                   October 2,     July 3,
                                                                      1999         1999
                                                                      ----         ----

<S>                                                                <C>          <C>
Current assets:
 Cash and cash equivalents                                         $  15,867    $  17,346
 Marketable securities                                                 1,541        3,254
 Accounts receivable - net                                            31,775       28,293
 Merchandise inventories                                             231,979      218,945
 Prepaid expenses and other current assets                             6,333        7,418
                                                                     -------      -------
      Total current assets                                           287,495      275,256

 Property and equipment - net                                         93,545       93,738
 Goodwill                                                             16,079       16,234
 Deferred tax asset                                                    9,331        9,254
 Investments                                                          13,504        8,314
 Investment in Avatex                                                  2,476        2,608
 Other assets                                                          4,978        5,133
                                                                     -------      -------

      Total assets                                                 $ 427,408    $ 410,537
                                                                   =========    =========

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
 Accounts payable                                                  $ 111,161    $ 119,843
 Accrued expenses and other current liabilities                       37,624       37,104
 Current portion of long-term debt and capital lease obligations       8,946        8,946
                                                                     -------      -------
      Total current liabilities                                      157,731      165,893

Long-term debt and capital lease obligations                         171,819      142,947
Long-term self insurance reserves                                      8,299        8,032
Deferred rent and unfavorable lease liability - net                   11,194       11,073
                                                                     -------      -------
      Total liabilities                                              349,043      327,945
                                                                     -------      -------

Commitments and contingencies

Minority interests                                                       535          535
                                                                     -------      -------

Stockholders' equity:
 Preferred stock                                                        --           --
 Common stock                                                            122          122
 Additional paid-in capital                                           90,007       90,007
 Stock options outstanding                                             2,200        2,105
 Other comprehensive income (loss):
  Unrealized loss on investment in Avatex                               (131)        --
 Retained deficit                                                    (14,368)     (10,177)
                                                                     -------      -------
      Total stockholders' equity                                      77,830       82,057
                                                                     -------      -------

      Total liabilities and stockholders' equity                   $ 427,408    $ 410,537
                                                                   =========    =========

</TABLE>

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

<PAGE> 4



                         PHAR-MOR, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                (Dollars in thousands, except per share amounts)
                                   (Unaudited)

<TABLE>
<CAPTION>

                                                       Thirteen           Thirteen
                                                      Weeks Ended        Weeks Ended
                                                    October 2, 1999   September 26, 1998
                                                    ---------------   ------------------

<S>                                                   <C>             <C>
Sales                                                 $    317,835    $    269,412

Less:
 Cost of goods sold, including occupancy and
      distribution costs                                   256,783         218,597
 Selling, general and administrative expenses               53,455          42,461
 Depreciation and amortization                               7,175           5,738
                                                           -------         -------

Income from operations before interest expense,
interest income, investment loss and income taxes              422           2,616

Interest expense                                            (4,554)         (3,991)
Interest income                                                  9             488
Investment loss                                                (68)           (625)
                                                           -------         -------

Loss before income taxes                                    (4,191)         (1,512)

Income taxes                                                  --              --
                                                           -------         -------

Net loss                                              $     (4,191)   $     (1,512)
                                                      ============    ============

Basic and diluted loss per common share               $       (.34)   $       (.12)
                                                      ============    ============

Weighted average number of basic and diluted common
shares outstanding                                      12,240,865      12,239,821

</TABLE>

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


<PAGE> 5



                         PHAR-MOR, INC. AND SUBSIDIARIES
             CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
                                 (In thousands)
                                   (Unaudited)

<TABLE>
<CAPTION>

                                                    Thirteen            Thirteen
                                                   Weeks Ended        Weeks Ended
                                                October 2, 1999     September 26, 1998
                                                ---------------     ------------------

<S>                                                  <C>                <C>
Net loss                                             $(4,191)           $(1,512)

Other comprehensive loss:
Unrealized loss on securities:
 Unrealized holding loss on investment in Avatex
  arising during period                                 (131)            (2,308)
                                                      ------             ------
Comprehensive loss                                   $(4,322)           $(3,820)
                                                     =======            =======

</TABLE>

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


<PAGE> 6


                         PHAR-MOR, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (In thousands)
                                   (Unaudited)
<TABLE>
<CAPTION>

                                                          Thirteen            Thirteen
                                                          Weeks Ended        Weeks Ended
                                                        October 2, 1999   September 26, 1998
                                                        ---------------   ------------------
OPERATING ACTIVITIES
<S>                                                      <C>             <C>
Net loss                                                 $     (4,191)   $     (1,512)
Adjustments to reconcile net loss to net cash used for
 operating activities:
 Items not requiring the outlay of cash:
  Depreciation                                                  4,641           3,682
  Amortization of video rental tapes                            2,241           1,981
  Stock option expense                                             95             183
  Amortization of deferred financing costs and goodwill           361             105
  Unrealized gain on equity investments                          (590)           --
  Deferred rent                                                   121              11
 Changes in assets and liabilities:
  Accounts receivable                                          (3,482)         (2,027)
  Marketable securities                                         1,713           2,463
  Merchandise inventories                                     (14,821)            137
  Prepaid expenses                                              1,008             659
  Other assets                                                    (51)            326
  Accounts payable                                            (22,088)         (7,103)
  Accrued expenses and other current liabilities                  699          (6,236)
                                                              -------         -------
Net cash used for operating activities                        (34,344)         (7,331)
                                                              -------         -------

INVESTING ACTIVITIES
 Additions to rental videotapes                                  (454)         (1,850)
 Additions to property and equipment                           (4,448)         (7,743)
 Investment in Avatex                                            --            (1,000)
 Investment in equity securities                               (4,600)           (251)
                                                              -------         -------
Net cash used for investing activities                         (9,502)        (10,844)
                                                              -------         -------

FINANCING ACTIVITIES
 Borrowings under revolving credit facility                    30,969            --
 Bank overdrafts                                               13,495            --
 Principal payments on long-term debt                            (446)           (977)
 Principal payments on capital lease obligations               (1,651)         (1,607)
 Issuance of common stock                                        --                31
                                                              -------         -------
Net cash from (used for) financing activities                  42,367          (2,553)
                                                              -------         -------

 Decrease in cash and cash equivalents                         (1,479)        (20,728)
 Cash and cash equivalents, beginning of period                17,346          44,655
                                                              -------         -------
 Cash and cash equivalents, end of period                $     15,867    $     23,927
                                                         ============    ============

</TABLE>



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


<PAGE> 7


PHAR-MOR, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in thousands, except per share amounts)
--------------------------------------------------------------------------------

1.       BASIS OF PRESENTATION
         The accompanying  unaudited  interim condensed  consolidated  financial
         statements  have been prepared in accordance  with  generally  accepted
         accounting  principles for interim financial  information.  They do not
         include  all  information  and  footnotes  which  would be  required by
         generally  accepted   accounting   principles  for  complete  financial
         statements.  In the  opinion  of  management  of  Phar-Mor,  Inc.  (the
         "Company") and its  subsidiaries,  these interim  financial  statements
         contain all adjustments considered necessary for a fair presentation of
         financial position, results of operations,  comprehensive loss and cash
         flows  for  the  periods  presented.  Reference  should  be made to the
         Company's  Annual Report on Form 10-K for the fiscal year ended July 3,
         1999 for additional  disclosures,  including a summary of the Company's
         accounting policies, which have not changed.  Operating results for the
         thirteen weeks ended October 2, 1999 are not necessarily  indicative of
         the results that may be expected for the fifty-two weeks ending July 1,
         2000.

2.       NEW ACCOUNTING PRONOUNCEMENTS
         In June 1997, the Financial  Accounting Standards Board ("FASB") issued
         SFAS  No.  130,   "Reporting   Comprehensive   Income."  SFAS  No.  130
         establishes  standards  for  reporting  comprehensive  income  and  its
         components,  some of which  have been  historically  excluded  from the
         Consolidated  Statement  of  Operations  and  recorded  directly to the
         equity section of an entity's statement of financial position. SFAS No.
         130 also requires that the  cumulative  balance of these items of other
         comprehensive income are reported separately from retained earnings and
         additional  paid-in  capital in the equity  section of a  statement  of
         financial  position.  The Company  adopted  SFAS No. 130 in fiscal year
         1999  and  has  elected  to  include  the   required   items  of  other
         comprehensive  income  in  its  Condensed  Consolidated  Statements  of
         Comprehensive  Income (Loss). The Company reported other  comprehensive
         income (loss) in each of the first three  quarters of fiscal year 1999,
         however  in the  fourth  quarter  the  Company  recorded  an other than
         temporary  impairment  write-down in its  statement of operation  which
         effectively eliminated the other comprehensive income (loss) for fiscal
         year 1999.

         In June 1998, the FASB issued SFAS No. 133,  "Accounting for Derivative
         Instruments and Hedging  Activities," which establishes  accounting and
         reporting   standards  for  derivative   instruments  and  for  hedging
         activities.  It requires that an entity  recognize all  derivatives  as
         either assets or liabilities in the statement of financial position and
         measure those  instruments at fair value,  with the potential effect on
         operations  dependent upon certain  conditions  being met. SFAS No. 133
         (as amended by SFAS No. 137) is  effective  for all fiscal  quarters of
         fiscal years beginning after June 15, 2000. Management does not believe
         that the  adoption  of SFAS No. 133 will have a material  impact on its
         financial position or results of operations.

3.       LITIGATION
         The Company and its  subsidiaries  are  involved in legal  proceedings,
         claims and litigation  arising in the ordinary  course of business.  In
         the  opinion  of   management,   the  outcome  of  such  current  legal
         proceedings,  claims and litigation  will not have a material impact on
         the Company's consolidated financial position.







<PAGE> 8


PHAR-MOR, INC. AND SUBSIDIARIES
ITEM 2. MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS



RESULTS OF OPERATIONS (all dollar amounts in thousands)

Thirteen Weeks Ended October 2, 1999 versus
    Thirteen Weeks Ended September 26, 1998

Sales for the first quarter of fiscal year 2000 ("Fiscal 2000")  increased 18.0%
compared  to the first  quarter  of  fiscal  year 1999  ("Fiscal  1999").  Sales
increased  14.2% due to the  acquisition of the 32 Pharmhouse  stores which were
acquired in March 1999.  Comparable store sales increased 3.4% from $266,152 for
Fiscal 1999 to $275,067 for Fiscal 2000. The increase in comparable  store sales
was primarily due to a 9.2% comparable store pharmacy sales increase.

Cost of sales as a  percentage  of sales was 80.8% in Fiscal  2000  compared  to
81.1% in Fiscal 1999, a 0.3%  improvement.  The  improvement is primarily due to
increased  vendor  income  related  to  the  remerchandising  activities  in the
Pharmhouse stores partially offset by lower video rental tape sales. In the last
year the Company closed  approximately  one half of its poorer  performing video
rental  departments  and  liquidated  the video  rental tape  inventory in those
stores.

Selling, general and administrative expenses as a percentage of sales were 16.8%
in Fiscal 2000 compared to 15.8% in Fiscal 1999. This increase was primarily due
to higher wages,  advertising and other store operating expenses as a percentage
of sales due to the inclusion of the lower volume  Pharmhouse  stores  partially
offset by lower corporate expenses as a percentage of sales.

Depreciation  and  amortization  expense was $7,175 in Fiscal  2000  compared to
$5,738 in Fiscal  1999,  an  increase of $1,437.  The  increase is the result of
depreciation on capital expenditures made since the first quarter of Fiscal 1999
and the  depreciation  and amortization on the assets acquired in the Pharmhouse
acquisition.

Interest  income was $9 in Fiscal 2000  compared  to interest  income of $488 in
Fiscal  1999,  a $479  decrease.  The  decrease in interest  income was due to a
decrease in the amount of excess funds available for investment in Fiscal 2000.

FINANCIAL CONDITION AND LIQUIDITY (all dollar amounts in thousands)

The  Company's  cash  position as of October 2, 1999 was $15,867.  The Company's
cash  position may fluctuate as a result of seasonal  merchandise  purchases and
timing of payments.

The Company entered into an Amended and Restated  Revolving Credit Facility (the
"Amended Facility")  effective September 10, 1998 with BABC, as agent, and other
financial  institutions that establishes a credit facility in the maximum amount
of $100,000.

Borrowings  under the Amended Facility may be used for working capital needs and
general  corporate  purposes.  Up to $50,000 of the Amended Facility at any time
may be used for standby and documentary  letters of credit. The Amended Facility
includes  restrictions  on, among other things,  additional  debt,  investments,
dividends  and other  distributions,  mergers and  acquisitions  and contains no
financial covenants.

Credit  availability under the Amended Facility at any time is the lesser of the
aggregate  availability  (as defined in the Amended  Facility) or $100,000.  The
Amended Facility  establishes a first priority lien and security interest in the
current  assets of the Company,  including,  among other items,  cash,  accounts
receivable and inventory.

Advances  made under the  Amended  Facility  bear  interest  at the  BankAmerica
reference  rate plus 1/2% or LIBOR plus  2.00%.  Under the terms of the  Amended
Facility,  the Company is required to pay a commitment  fee of between 0.25% and
0.35% per annum on the unused portion of the facility, letter of credit fees and
certain other fees.

Unused  availability under the Amended Facility,  after subtracting amounts used
for outstanding letters of credit, was $43,763 at October 2, 1999.

The Amended Facility expires on March 14, 2002.

Thirteen weeks ended October 2, 1999

During the thirteen  weeks ended October 2, 1999,  the  Company's  cash position
decreased by $1,479.  Net cash used by  operating  activities  was $34,344.  The
major uses of cash from  operating  activities  were for an increase in accounts
receivable of $3,482,  an increase in inventories of $14,821 in  anticipation of
the  holiday  season and a decrease  in  accounts  payable of $22,088 due to the
timing of payments.

<PAGE> 9

Capital  expenditures of $4,448,  additions to video rental tapes of $454 and an
additional  $4,600  investment  in  equity  securities  were  paid  for with the
Company's revolving credit facility.

Net cash from financing  activities of $42,367 consisted of borrowings under the
revolving  credit facility and increases in bank overdrafts  partially offset by
principal payments on lease obligations of $1,651 and principal payments on term
debt of $446.

The  Company  is  exposed to certain  market  risks from  transactions  that are
entered into during the normal course of business. The Company's policies do not
permit active trading of, or speculation in, derivative  financial  instruments.
The Company's  primary  market risk exposure  relates to interest rate risk. The
Company manages its interest rate risk in order to balance its exposure  between
fixed and variable rates while attempting to minimize its interest costs.


<PAGE> 10


Trends,  Demands,  Commitments,  Events or Uncertainties  (all dollar amounts in
thousands)

Certain  Company  information  systems have  potential  operational  problems in
connection  with  applications  that  contain  a date  and/or  use a  date  in a
comparative  manner as the date  transitions into the Year 2000. The Company has
implemented a comprehensive program to identify and remediate potential problems
related to the Year 2000 in its information systems,  infrastructure,  logistics
and  retail   facilities.   In  addition,   the  Company  has  initiated  formal
communication with all of its significant  vendors and other external interfaces
to determine the extent to which the Company is  vulnerable  to a  third-party's
failure to remediate their own potential  problems related to the Year 2000. The
inability of the Company or significant  vendors and/or  external  interfaces of
the Company to adequately address Year 2000 issues could cause disruption of the
Company's systems.

Management believes,  based on its assessment of all of its systems, that it has
completed all of the software  modifications  necessary to make its systems year
2000  compliant.  The Company will replace  certain  personal  computer  related
hardware before December 31, 1999 to ensure that those systems will be Year 2000
compliant.  The  Company  has  developed  or is in  the  process  of  developing
contingency  plans that include  manually  performing  work in place of affected
systems and the renting of back-up systems and generators.

As of October 2, 1999, the Company has incurred  approximately $1,300 related to
the  assessment  of, and efforts in connection  with,  its Year 2000 program and
remediation  plan.  The Company has completed all of the software  modifications
necessary  to make its systems Year 2000  compliant  and  anticipates  no future
expenditures for software  modifications will be necessary.  Future spending for
hardware  purchases  required  for  Year  2000  are  currently  estimated  to be
approximately  $200.  The Company has  accelerated  by one year the  purchase of
approximately  $5,000 in replacement  hardware in order to ensure the associated
system is Year 2000  compliant.  These  expenditures  are not expected to have a
material  impact on the  Company's  operating  results,  liquidity  and  capital
resources.

In June  1998,  the  FASB  issued  SFAS  No.  133,  "Accounting  for  Derivative
Instruments and Hedging Activities," which establishes  accounting and reporting
standards for derivative  instruments  and for hedging  activities.  It requires
that an entity  recognize all derivatives as either assets or liabilities in the
statement of financial  position and measure  those  instruments  at fair value,
with the potential effect on operations  dependent upon certain conditions being
met.  SFAS No. 133 (as  amended  by SFAS No.  137) is  effective  for all fiscal
quarters of fiscal  years  beginning  after June 15, 2000.  Management  does not
believe  that the  adoption  of SFAS No. 133 will have a material  impact on its
financial position or results of operations.



<PAGE> 11


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

                  None.

ITEM 5.  OTHER INFORMATION

                  None.



<PAGE> 12


ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

         (a)      Exhibits

                  See Exhibit Index on page 15.

         (b)      Reports on Form 8-K

                  The  following  reports  on  Form  8-K  were  filed  with  the
                  Securities  and Exchange  Commission  during the quarter ended
                  October 2, 1999

                  None.




<PAGE> 13



                                   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.




                                 PHAR-MOR, INC.


Date:  November 3, 1999                   By:   /s/ Sankar Krishnan
                                                -------------------
                                                    Sankar Krishnan
                                                    Senior Vice President and
                                                    Chief Financial Officer



Date:  November 3, 1999                   By:   /s/ John R. Ficarro
                                                -------------------
                                                    John R. Ficarro
                                                    Senior Vice President and
                                                    Chief Administrative Officer


<PAGE>14






                                 PHAR-MOR, INC.

                                INDEX TO EXHIBITS


Exhibit No.

*3.1     Amended and Restated Articles of Incorporation

**3.2    Amended and Restated By-laws

*4.1     Indenture  dated  September  11, 1995  between  Phar-Mor,  Inc. and IBJ
         Schroder Bank & Trust Company

*4.2     Warrant Agreement dated September 11, 1995 between  Phar-Mor,  Inc. and
         Society National Bank

***10.1  Loan and Security  Agreement,  dated as of September  10, 1998,  by and
         among the financial institutions listed on the signature pages therein,
         BankAmerica  Business  Credit,  Inc.,  as agent,  and  Phar-Mor,  Inc.,
         Phar-Mor,  Inc., LLC, Phar-Mor of Delaware,  Inc., Phar-Mor of Florida,
         Inc., Phar-Mor of Ohio, Inc., Phar-Mor of Virginia,  Inc., and Phar-Mor
         of Wisconsin, Inc.

27                         Financial Data Schedule
-----------------------------------------------------------------
*        Previously filed in connection with the filing of Phar-Mor's Form 10,
         on October 23, 1995

**       Previously filed in connection with the filing of Phar-Mor's quarterly
         report on Form 10-Q, on May 1, 1998

***      Previously filed in connection with the filing of Phar-Mor's quarterly
         report on Form 10-Q, on November 2, 1998