<PAGE>   1
                         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 December 31, 1996

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

                  For the transaction period from __________ to __________

Commission file number 0-19267

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

     PENNSYLVANIA                                            23-2472830
------------------------------                           -------------------
(State or other jurisdiction of                           (I.R.S. Employer
 incorporation or organization)                          Identification No.)

    64 Sidney Street, Cambridge, MA                          02139-4136
---------------------------------------                  ----------------- 
(Address of principal executive offices)                    (Zip Code)

Registrant's telephone number including area code:     (617) 494-0171
                                                   ----------------------
                                                                 
                                 Not Applicable
--------------------------------------------------------------------------------
              Former name, former address, and former 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 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.

        Class                           Shares Outstanding as of January 9, 1997
        -----                           ----------------------------------------
Common Stock, par value $.01                               18,543,309
<PAGE>   2
                         ALKERMES, INC. AND SUBSIDIARIES

                                      INDEX

<TABLE>
<CAPTION>
                                                                                                     Page No.

<S>                                                                                                      <C>
PART I - FINANCIAL INFORMATION

                Item 1.    Consolidated Financial Statements

                           Consolidated Balance Sheets                                                    3
                           - December 31, 1996 and March 31, 1996

                           Consolidated Statements of Operations                                          4
                           - Three months ended December 31, 1996 and 1995
                             Nine months ended December 31, 1996 and 1995

                           Consolidated Statement of Shareholders' Equity                                 5
                           - Nine months ended December 31, 1996

                           Consolidated Statements of Cash Flows                                          6
                           - Nine months ended December 31, 1996 and 1995

                           Notes to Consolidated Financial Statements                                     7

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

PART II - OTHER INFORMATION

            Item 6.    Exhibits and Reports on Form 8-K                                                   13

SIGNATURES                                                                                                16

EXHIBIT INDEX                                                                                             17
</TABLE>


                                      (2)
<PAGE>   3
ITEM 1.  CONSOLIDATED FINANCIAL STATEMENTS:

                         ALKERMES, INC. AND SUBSIDIARIES

                           CONSOLIDATED BALANCE SHEETS
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                                      December 31,            March 31,
                                                                                          1996                  1996
                                                                                      -------------        -------------

                                   A S S E T S

<S>                                                                                   <C>                  <C> 
Current Assets:
      Cash and cash equivalents                                                       $     210,783        $     445,150
      Short-term investments                                                             42,464,335           31,929,214
      Receivables from collaborative arrangements                                         3,367,935              500,000
      Prepaid expenses and other current assets                                             894,539            1,457,477
                                                                                      -------------        -------------
           Total current assets                                                          46,937,592           34,331,841
                                                                                      -------------        -------------
Property, Plant and Equipment:
      Land                                                                                  225,000              225,000
      Building                                                                            1,275,000            1,275,000
      Furniture, fixtures and equipment                                                  11,148,987            9,864,501
      Leasehold improvements                                                              2,174,927            2,008,193
      Construction in progress                                                                   --              147,326
                                                                                      -------------        -------------
                                                                                         14,823,914           13,520,020
           Less accumulated depreciation and amortization                                (6,695,737)          (5,097,882)
                                                                                      -------------        -------------
                                                                                          8,128,177            8,422,138
                                                                                      -------------        -------------
Investments                                                                               1,371,192            1,372,789
                                                                                      -------------        -------------
Other Assets                                                                                620,233              747,377
                                                                                      -------------        -------------
Other Investments                                                                           554,070              877,928
                                                                                      -------------        -------------
                                                                                      $  57,611,264        $  45,752,073
                                                                                      =============        =============


        L I A B I L I T I E S  A N D  S H A R E H O L D E R S'  E Q U I T Y

Current Liabilities:
      Accounts payable and accrued expenses                                           $   2,368,478        $   3,522,178
      Long-term debt, current portion                                                     3,838,710            2,925,756
                                                                                      -------------        -------------
           Total current liabilities                                                      6,207,188            6,447,934
                                                                                      -------------        -------------
Long-Term Debt, less current portion                                                     11,610,721            9,876,347
                                                                                      -------------        -------------
Other Long-Term Liabilities                                                               1,303,083              915,241
                                                                                      -------------        -------------
Deferred Revenue                                                                          5,000,000            5,000,000
                                                                                      -------------        -------------
Shareholders' Equity:

      Capital stock, par value $.01 per share:
        Authorized, 5,000,000 shares; none issued
      Common stock, par value $.01 per share:
        Authorized 40,000,000 shares; issued 18,517,394 shares at
        December 31, 1996 and 15,966,942 shares at March 31, 1996                           185,174              159,669
      Additional paid-in capital                                                        148,273,154          124,239,023
      Receivable for warrants and deferred compensation                                    (153,175)            (317,682)
      Cumulative foreign currency translation adjustments                                     8,665              (24,354)
      Unrealized gain on marketable securities                                              193,125              502,500
      Accumulated deficit                                                              (115,016,671)        (101,046,605)
                                                                                      -------------        -------------
           Total shareholders' equity                                                    33,490,272           23,512,551
                                                                                      -------------        -------------
                                                                                      $  57,611,264        $  45,752,073
                                                                                      =============        =============
</TABLE>





See notes to consolidated financial statements.

                                      (3)
<PAGE>   4
                         ALKERMES, INC. AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                            Three Months        Three Months       Nine Months          Nine Months
                                                               Ended                Ended             Ended                Ended
                                                            December 31,        December 31,       December 31,         December 31,
                                                                1996                1995               1996                 1995
                                                           ------------        ------------        ------------        ------------
<S>                                                        <C>                 <C>                 <C>                 <C>    
Revenues:
     Research and development revenue under
        collaborative arrangements                         $  4,913,099        $    374,525         $10,827,964        $  1,772,624
     Research and development revenue under
        collaborative arrangement with related party                 --           2,679,595           1,415,313           7,898,348
     Interest income                                            591,945             616,268           1,763,905           1,360,283
                                                           ------------        ------------        ------------        ------------
                                                              5,505,044           3,670,388          14,007,182          11,031,255
                                                           ------------        ------------        ------------        ------------
Expenses:
     Research and development                                 7,657,829           4,873,939          21,213,773          14,913,361
     General and administrative                               1,683,749           1,305,913           5,753,367           3,601,825
     Interest expense                                           400,157             262,351           1,010,108             717,218
                                                           ------------        ------------        ------------        ------------
                                                              9,741,735           6,442,203          27,977,248          19,232,404
                                                           ------------        ------------        ------------        ------------

Net loss                                                   $( 4,236,691)       $( 2,771,815)       $(13,970,066)       $( 8,201,149)
                                                           ============        ============        ============        ============

Net loss per weighted average number of common
  shares                                                         ($0.23)             ($0.17)             ($0.77)             ($0.57)
                                                           ============        ============        ============        ============
Weighted average number of common shares
  outstanding                                                18,479,498          15,852,081          18,076,420          14,387,290
                                                           ============        ============        ============        ============
</TABLE>

See notes to consolidated financial statements.

   
                                       (4)


<PAGE>   5
                         ALKERMES, INC. AND SUBSIDIARIES

                 CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY
                                   (Unaudited)



<TABLE>
<CAPTION>
                                                                                                                        Receivable  
                                                                     Common Stock                   Additional         for Warrants 
                                                                     ------------                    Paid-in           and Deferred 
                                                              Shares              Amount             Capital           Compensation 
                                                          -------------       -------------       -------------       -------------
<S>                                                       <C>                 <C>                 <C>
Balance, April 1, 1996                                       15,966,942       $     159,669       $ 124,239,023       $    (317,682)
Issuance of common stock 4/96 through 6/96,
   net of issuance costs of $65,000                           2,398,204              23,982          23,346,771                --   
Amortization of receivable for warrants                            --                  --                  --                34,687
Amortization of compensation relating to grant
   of stock options and awards made                                --                  --                  --                43,274
Unrealized loss on marketable securities                           --                  --                  --                  --   
Cumulative foreign currency translation adjustments                --                  --                  --                  --   
Net loss for period                                                --                  --                  --                  --   
                                                          -------------       -------------       -------------       -------------
Balance, June 30, 1996                                       18,365,146             183,651         147,585,794            (239,721)

Issuance of common stock 7/96 through 9/96                       82,865                 829             359,830                --   
Amortization of compensation relating to grant
   of stock options and awards made                                --                  --                  --                43,273
Unrealized loss on marketable securities                           --                  --                  --                  --   
Cumulative foreign currency translation adjustments                --                  --                  --                  --   
Net loss for period                                                --                  --                  --                  --   
                                                          -------------       -------------       -------------       -------------
Balance, September 30, 1996                                  18,448,011             184,480         147,945,624            (196,448)

Issuance of common stock 10/96 through 12/96                     69,383                 694             327,530                --   
Amortization of compensation relating to grant
   of stock options and awards made                                --                  --                  --                43,273
Unrealized gain on marketable securities                           --                  --                  --                  --   
Cumulative foreign currency translation adjustments                --                  --                  --                  --   
Net loss for period                                                --                  --                  --                  --   
                                                          -------------       -------------       -------------       -------------
Balance, December 31, 1996                                   18,517,394       $     185,174       $ 148,273,154       $    (153,175)
                                                          =============       =============       =============       =============
</TABLE>



<TABLE>
<CAPTION>
                                                          Cumulative           Unrealized
                                                       Foreign Currency        Gain (Loss)
                                                          Translation         on Marketable       Accumulated
                                                          Adjustments          Securities           Deficit              Total 
                                                          -----------          ----------           -------              ----- 

<S>                                                    <C>                   <C>                 <C>                 <C>
Balance, April 1, 1996                                   $     (24,354)      $     502,500       $(101,046,605)      $  23,512,551
Issuance of common stock 4/96 through 6/96,
   net of issuance costs of $65,000                               --                  --                  --            23,370,753
Amortization of receivable for warrants                           --                  --                  --                34,687
Amortization of compensation relating to grant
   of stock options and awards made                               --                  --                  --                43,274
Unrealized loss on marketable securities                          --              (206,250)               --              (206,250)
Cumulative foreign currency translation adjustments              7,134                --                  --                 7,134
Net loss for period                                               --                  --            (4,943,991)         (4,943,991)
                                                         -------------       -------------       -------------       -------------
Balance, June 30, 1996                                         (17,220)            296,250        (105,990,596)         41,818,158

Issuance of common stock 7/96 through 9/96                        --                  --                  --               360,659
Amortization of compensation relating to grant
   of stock options and awards made                               --                  --                  --                43,273
Unrealized loss on marketable securities                          --              (206,250)               --              (206,250)
Cumulative foreign currency translation adjustments                503                --                  --                   503
Net loss for period                                               --                  --            (4,789,384)         (4,789,384)
                                                         -------------       -------------       -------------       -------------
Balance, September 30, 1996                                    (16,717)             90,000        (110,779,980)         37,226,959

Issuance of common stock 10/96 through 12/96                      --                  --                  --               328,224
Amortization of compensation relating to grant
   of stock options and awards made                               --                  --                  --                43,273
Unrealized gain on marketable securities                          --               103,125                --               103,125
Cumulative foreign currency translation adjustments             25,382                --                  --                25,382
Net loss for period                                               --                  --            (4,236,691)         (4,236,691)
                                                         -------------       -------------       -------------       -------------
Balance, December 31, 1996                               $       8,665       $     193,125       $(115,016,671)      $  33,490,272
                                                         =============       =============       =============       =============
</TABLE>


See notes to consolidated financial statements.


                                       (5)
<PAGE>   6
                         ALKERMES, INC. AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (Unaudited)


<TABLE>
<CAPTION>
                                                                                Nine Months        Nine Months
                                                                                   Ended              Ended
                                                                                December 31,       December 31,
                                                                                    1996               1995
                                                                               ------------        ------------

<S>                                                                            <C>                 <C>
Cash flows from operating activities:
   Net loss                                                                    $(13,970,066)       $ (8,201,149)
   Adjustments to reconcile net loss to net cash used by
        operating activities:
        Depreciation and amortization                                             1,734,763           1,227,975
        Amortization of amounts receivable for warrants and compensation
           relating to grant of stock options and awards made                       164,507             421,916
        Adjustments to other investments                                             14,483              87,712
        Other noncash items                                                            --               418,234
        Changes in assets and liabilities:
             Receivables from collaborative arrangements                         (2,867,935)               --
             Prepaid expenses and other current assets                              558,546            (397,303)
             Accounts payable and accrued expenses                               (1,134,615)           (243,430)
             Deferred revenue from Alkermes Clinical Partners, L.P.                    --            (1,085,000)
             Other long-term liabilities                                            387,842              46,209
             Deferred revenue                                                          --             5,000,000
                                                                               ------------        ------------
                  Net cash used by operating activities                         (15,112,475)         (2,724,836)
                                                                               ------------        ------------

Cash flows from investing activities:
   Additions to property, plant and equipment, net                               (1,349,023)         (1,780,883)
   Purchases of short-term investments, net                                     (10,535,121)        (21,082,142)
   Sales of investments, net                                                          1,597           2,994,437
   Investment in Alkermes Clinical Partners, L.P.                                      --              (113,463)
   Other assets                                                                      10,500              40,500
   Repayment of loan to Alkermes Clinical Partners, L.P.                               --             4,735,000
                                                                               ------------        ------------
                  Net cash used by investing activities                         (11,872,047)        (15,206,551)
                                                                               ------------        ------------

Cash flows from financing activities:
   Proceeds from issuance of common stock, net                                   24,059,636          14,930,715
   Proceeds from issuance of long-term debt                                       5,000,000           4,500,000
   Payment of long-term debt                                                     (2,346,535)         (2,003,776)
                                                                               ------------        ------------
                  Net cash provided by financing activities                      26,713,101          17,426,939
                                                                               ------------        ------------

Effect of exchange rate changes on cash                                              37,054             (13,666)
                                                                               ------------        ------------

Net decrease in cash and cash equivalents                                          (234,367)           (518,114)
Cash and cash equivalents, beginning of period                                      445,150           1,086,627
                                                                               ------------        ------------
Cash and cash equivalents, end of period                                       $    210,783        $    568,513
                                                                               ============        ============

Supplementary information:
   Interest paid                                                               $    541,876        $    369,103
                                                                               ============        ============
</TABLE>




See notes to consolidated financial statements.


                                       (6)
<PAGE>   7
                         ALKERMES, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


1.  BASIS OF PRESENTATION

The consolidated financial statements for the three and nine month periods ended
December 31, 1996 and 1995, are unaudited and include all adjustments which, in
the opinion of management, are necessary to present fairly the results of
operations for the periods then ended. All such adjustments are of a normal
recurring nature. These financial statements should be read in conjunction with
the Company's Annual Report on Form 10-K for the year ended March 31, 1996,
which includes consolidated financial statements and notes thereto for the years
ended March 31, 1996, 1995 and 1994. In addition, the financial statements
include the accounts of Alkermes Controlled Therapeutics, Inc., Alkermes
Controlled Therapeutics Inc. II, Alkermes Investments, Inc., Alkermes Europe,
Ltd. and Alkermes Development Corporation II, wholly owned subsidiaries of the
Company.

The results of the Company's operations for any interim period are not
necessarily indicative of the results of the Company's operations for any other
interim period or for a full fiscal year.

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

2.  NEW ACCOUNTING PRONOUNCEMENTS

In March 1995, the Financial Accounting Standards Board (FASB) issued Statement
of Financial Accounting Standards (SFAS) No. 121, "Accounting for the Impairment
of Long-Lived Assets and for Long-Lived Assets to Be Disposed of" which requires
the Company to review for impairment of long-lived assets, certain identifiable
intangibles and goodwill related to those assets whenever events or changes in
circumstances indicate that the carrying amount of an asset may not be
recoverable. In certain situations, an impairment loss would be recognized. The
Company adopted SFAS No. 121 in the quarter ended June 30, 1996. The adoption
did not have a material effect on the Company's consolidated financial position,
results of operations or cash flows.

In October 1995, the FASB issued SFAS No. 123, "Accounting for Stock-Based
Compensation" which is effective in fiscal 1997 for the Company. The Company
intends to continue to account for its stock-based transactions with employees
in accordance with Accounting Principles Board Opinion No. 25, "Accounting for
Stock Issued to Employees" and will include the pro forma disclosures required
by SFAS No. 123 at March 31, 1997. The adoption of SFAS No. 123 did not have a
material impact on the Company's consolidated financial position, results of
operations or cash flows.

                                       (7)
<PAGE>   8
3.  LONG-TERM DEBT

In September 1996, the Company amended its loan with an existing bank and
increased the principal amount of the loan by $5,000,000, securing the existing
and the additional principal amounts with a building and the real property
pursuant to a mortgage and certain of the Company's equipment pursuant to a
security agreement. The additional principal amount of the loan is payable over
five years in equal monthly installments of $83,333, which commenced November 1,
1996 and bears interest at the fixed rate of 8.54% per annum.

4.  RECLASSIFICATIONS

Certain reclassifications have been made to the fiscal 1996 amounts to conform
to the presentation used in fiscal 1997.

                                       (8)
<PAGE>   9
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

INTRODUCTION

Alkermes is developing sophisticated products based on innovative drug delivery
technologies. Since its inception in 1987, the Company has devoted substantially
all of its resources to its research and development programs. Alkermes has not
received any revenue from the sales of products. The Company has been
unprofitable since inception and expects to incur substantial additional
operating losses over the next several years. At December 31, 1996, the Company
had an accumulated deficit of approximately $115.0 million.

The Company has funded its operations primarily through public offerings and
private placements of equity securities, bank loans and payments under research
and development agreements with collaborators, including Alkermes Clinical
Partners, L.P. ("Clinical Partners"), a research and development limited
partnership whose operations commenced in April 1992. Funding from Clinical
Partners ended as of June 30, 1996. The Company intends to develop its product
candidates in collaboration with others on whom the Company will rely for
funding, development, manufacturing and/or marketing.

FORWARD-LOOKING STATEMENTS

Any statements set forth below or otherwise made in writing or orally by the
Company with regard to its expectations as to financial results and other
aspects of its business may constitute forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995. Although the
Company makes such statements based on assumptions which it believes to be
reasonable, the Company's business is subject to significant risks and there can
be no assurance that actual results will not differ materially from the
Company's expectations. Accordingly, the Company hereby identifies the following
important factors, among others, which could cause its results to differ from
any results which might be projected, forecasted or estimated by the Company in
any such forward-looking statements: (i) the Company and its collaborators could
not be permitted by regulatory authorities to undertake additional clinical
trials for RMP-7(TM), ProLease(R) or Medisorb(R); (ii) product candidates could
be ineffective or unsafe during clinical trials; (iii) the Company could incur
difficulties or set-backs in obtaining the substantial additional funding
required to continue research and development programs and clinical trials; (iv)
even if product candidates appear promising at an early stage of development,
product candidates could fail to receive necessary regulatory approvals, be
difficult to manufacture on a large scale, be uneconomical, fail to achieve
market acceptance, be precluded from commercialization by proprietary rights of
third parties or experience substantial competition in the marketplace; (v)
technological change in the biotechnology or pharmaceutical industries could
render the Company's product candidates obsolete or noncompetitive; (vi)
disputes with collaborators, termination of collaborations or failure to
negotiate acceptable new collaborative arrangements for ProLease and Medisorb
technologies, which are not independently commercializable, could occur; (vii)
disputes with Clinical Partners over rights to the RMP-7 and related technology
could occur, or the Company could fail to purchase this technology from Clinical
Partners pursuant to the purchase option (the "Purchase Option"), or, if the
Company did purchase RMP technology from Clinical Partners (a) in shares of the
Company's common stock, the Company's shareholders would be substantially
diluted or (b) in cash, the Company's capital resources would be substantially
depleted; and (viii) difficulties or set-backs in obtaining and enforcing
Alkermes' patents and with the patent rights of others could occur.

                                      (9)
<PAGE>   10
RESULTS OF OPERATIONS

The Company's research and development revenue under collaborative arrangement
with related party for the three and nine months ended December 31, 1996 was
zero and $1,415,313 compared to $2,679,595 and $7,898,348 for the corresponding
periods of the prior year. This revenue was received from Clinical Partners
under a product development agreement for RMP-7 entered into in March 1992. The
decrease in such revenue for the three and nine months ended December 31, 1996
as compared to the corresponding periods of the prior year was a result of the
completion of the funding pursuant to the product development agreement during
the quarter ended June 30, 1996. Since the completion of funding from Clinical
Partners, Alkermes has used its own resources, and intends to continue to use
its own resources, to develop RMP-7. The Company's research and development
revenue under collaborative arrangements for the three and nine months ended
December 31, 1996 was $4,913,099 and $10,827,964 compared to $374,525 and
$1,772,624 for the corresponding periods of the prior year. The increase in such
revenue for the three and nine months ended December 31, 1996 as compared to the
corresponding periods of the prior year was mainly a result of the funding and
milestones earned under new or expanded collaborative agreements related to 
the Company's ProLease and Medisorb technologies.

Interest income for the three and nine months ended December 31, 1996 was
$591,945 and $1,763,905 compared to $616,268 and $1,360,283 for the
corresponding periods of the prior year. The decrease in the revenue for the
three months ended December 31, 1996 as compared to the corresponding period of
the prior year was mainly a result of a decrease in interest rates during the
past quarter as compared to the same quarter last year. The increase in such
revenue for the nine months ended December 31, 1996 as compared to the
corresponding period of the prior year was primarily a result of the investment
of the net proceeds of approximately $22.9 million received upon the
consummation of a public offering of the Company's common stock in May 1996.

The Company's total operating expenses were $9,741,735 and $27,977,248 for the
three and nine months ended December 31, 1996 as compared to $6,442,203 and
$19,232,404 for the three and nine months ended December 31, 1995. Research and
development expenses for the three and nine months ended December 31, 1996 were
$7,657,829 and $21,213,773 compared to $4,873,939 and $14,913,361 for the
corresponding periods of the prior year. The increase in research and
development expenses for the three and nine months ended December 31, 1996 as
compared to the three and nine months ended December 31, 1995 was mainly the
result of salary and related benefits and other operating costs associated with
the acquisition of the Medisorb technology and certain related assets in March
1996. During the three and nine months ended December 31, 1996, there was also
an increase in purchases of lab supplies and clinical expenses related primarily
to the Company's ProLease, RMP-7 and Medisorb programs, partially offset by a
reduction in the preclinical costs of the Company's RMP-7 program which were
completed during the prior year.

General and administrative expenses for the three and nine months ended December
31, 1996 were $1,683,749 and $5,753,367 compared to $1,305,913 and $3,601,825
for the corresponding periods of the prior year. The increase in the three and
nine months ended December 31, 1996 as compared to the three and nine months
ended December 31, 1995 was mainly the result of salary and related benefits and
other operating costs associated with the acquisition of the Medisorb technology
and certain related assets in March 1996 as well as an increase in patent legal
costs. In addition, there were non-cash charges related to the write-down of the
Company's investment in Clinical Partners in the three months ended June 30,
1996.

The Company does not believe that inflation and changing prices have had a
material impact on its results of operations.

                                      (10)
<PAGE>   11
LIQUIDITY AND CAPITAL RESOURCES

At December 31, 1996, the Company had current assets totaling $46,937,592,
primarily consisting of $210,783 in cash and cash equivalents and $42,464,335 in
Government obligations having a maturity of less than one year; and current
liabilities of $6,207,188. The Company's short-term investment objectives are,
first, to assure conservation of principal, and second, to obtain investment
income. As a result, the Company invests primarily in high grade government or
government-backed securities.

During the three months ended December 31, 1996, the Company announced three new
or expanded collaborative agreements. Development funding and milestone payments
to Alkermes for these phases of the collaborations could exceed $60 million,
assuming the development of the product candidates proceed as planned.

In September 1996, the Company amended its loan with an existing bank and
increased the principal amount of the loan by $5,000,000, securing the existing
and the additional principal amounts with a building and the real property
pursuant to a mortgage and certain of the Company's equipment pursuant to a
security agreement.

In May 1996, the Company completed a public offering of 2,300,000 shares of its
common stock at $10 per share. Net proceeds to the Company were approximately
$22.9 million.

The Company's research and development costs to date have been financed
primarily by sales of equity securities and research and development
collaborative arrangements. The Company expects to incur significant research
and development and other costs, including costs related to preclinical studies,
clinical trials and facilities expansion. The research and development revenue
from Clinical Partners ended during the quarter ended June 30, 1996. Such
funding was not sufficient to complete clinical trials and seek regulatory
approval of RMP-7. Since the completion of funding from Clinical Partners,
Alkermes has used its own resources, and intends to continue to use its own
resources, to develop RMP-7, but may be forced to seek alternative sources of
funding, including additional collaborators. The Company is required to fund the
development of RMP-7 to maintain its Purchase Option with Clinical Partners.

The Company expects that its research and development and other costs will
exceed revenues significantly for the next several years, which will result in
continuing losses from operations. The Company's capital expenditures for
equipment, facilities and building improvements have been financed to date
primarily with proceeds from bank loans and the sales of equity securities. The
Company will continue to pursue opportunities to obtain additional financing in
the future. Such financing may be sought through various sources, including
equity offerings, bank borrowings, lease arrangements relating to fixed assets
or other financing methods. The source, timing and availability of any
financings will depend on market conditions, interest rates and other factors.

                                      (11)
<PAGE>   12
The Company's future capital requirements will depend on many factors, including
continued scientific progress in its research and development programs, the
magnitude of these programs, progress with preclinical testing and clinical
trials, the time and costs involved in obtaining regulatory approvals, the costs
involved in filing, prosecuting and enforcing patent claims, competing
technological and market developments, the establishment of additional
collaborative arrangements, the cost of manufacturing facilities and of
commercialization activities and arrangements and the cost of product
in-licensing and any possible acquisitions.

The Company will need to raise substantial additional funds for longer-term
product development, regulatory approvals and manufacturing or marketing
activities that it might undertake in the future. There can be no assurance that
additional funds will be available on favorable terms, if at all. If adequate
funds are not available, the Company may be required to curtail significantly
one or more of its research and development programs and/or obtain funds through
arrangements with collaborative partners or others that may require the Company
to relinquish rights to certain of its technologies, product candidates or
future products.

                                      (12)
<PAGE>   13
PART II.  OTHER INFORMATION

ITEM 6.       EXHIBITS AND REPORTS ON FORM 8-K

              (a)  Exhibits:
<TABLE>
<CAPTION>
                               Number                 Exhibit
                               ------                 -------
<S>                            <C>               <C>
                               3.1(a)            Second Amended and Restated
                                                 Articles of Incorporation, as
                                                 filed with the Pennsylvania
                                                 Secretary of State on July 23,
                                                 1991 (Incorporated by reference
                                                 to Exhibit 4.1(a) to the
                                                 Company's Report on Form 10-Q
                                                 for the quarter ended June 30,
                                                 1991).

                               3.1(b)            Statement of Change of
                                                 Registered Office, as filed
                                                 with the Pennsylvania Secretary
                                                 of State on July 23, 1991
                                                 (Incorporated by reference to
                                                 Exhibit 4.1(b) to the Company's
                                                 Report on Form 10-Q for the
                                                 quarter ended June 30, 1991).

                               3.1(c)            Amendment to the Second Amended
                                                 and Restated Articles of
                                                 Incorporation, as filed with
                                                 the Pennsylvania Secretary of
                                                 State on November 1, 1991.
                                                 (Incorporated by reference to
                                                 Exhibit 4.1(c) to the Company's
                                                 Report on Form 10-Q for the
                                                 quarter ended September 30,
                                                 1991).

                               3.1(d)            Amendment to the Second Amended
                                                 and Restated Articles of
                                                 Incorporation, as filed with
                                                 the Pennsylvania Secretary of
                                                 State on February 12, 1993.
                                                 (Incorporated by reference to
                                                 Exhibit 4.1(d) to the Company's
                                                 Report on Form 10-Q for the
                                                 quarter ended December 31,
                                                 1992).

                               3.2               Amended and Restated By-Laws of
                                                 Alkermes, Inc., effective as of
                                                 July 1, 1994. (Incorporated by
                                                 reference to Exhibit 4.2 to the
                                                 Company's Report on Form 10-Q
                                                 for the quarter ended June 30,
                                                 1994).

                               4.1               Specimen of Common Stock
                                                 Certificate of Alkermes, Inc.
                                                 (Incorporated by reference to
                                                 Exhibit 4 to the Company's
                                                 Registration Statement on Form
                                                 S-1, as amended (File No.
                                                 33-40250)).

                               4.2               Form of 1992 Warrant to
                                                 purchase 2,800 shares of the
                                                 Company's Common Stock.
                                                 (Incorporated by reference to
                                                 Exhibit 4.2 to the Company's
                                                 Report on Form 10-K for the
                                                 fiscal year ended March 31,
                                                 1992).

                               4.3               Form of 1995 Warrant to
                                                 purchase 300 shares of the
                                                 Company's Common Stock.
                                                 (Incorporated by reference to
                                                 Exhibit 4.3 to the Company's
                                                 Report on Form 10-K for the
                                                 fiscal year ended March 31,
                                                 1992).
</TABLE>

                                      (13)
<PAGE>   14
<TABLE>
<CAPTION>
                               Number                     Exhibit
                               ------                     -------
<S>                            <C>               <C>
                               4.4               Form of Global Warrant
                                                 Certificate for 1994 Class A
                                                 Warrants. (Incorporated by
                                                 reference to Exhibit 4.6 to the
                                                 Company's Report on Form 10-Q
                                                 for the quarter ended December
                                                 31, 1994).

                               4.5               Form of Global Warrant
                                                 Certificate for 1994 Class B
                                                 Warrants. (Incorporated by
                                                 reference to Exhibit 4.7 to the
                                                 Company's Report on Form 10-Q
                                                 for the quarter ended December
                                                 31, 1994).

                               4.6               Form of Global Warrant
                                                 Certificate for 1994 Affiliate
                                                 Warrants. (Incorporated by
                                                 reference to Exhibit 4.8 to the
                                                 Company's Report on Form 10-Q
                                                 for the quarter ended December
                                                 31, 1994).

                               4.7               Form of Global Warrant
                                                 Certificate for 1994 Incentive
                                                 Warrants. (Incorporated by
                                                 reference to Exhibit 4.9 to the
                                                 Company's Report on Form 10-Q
                                                 for the quarter ended December
                                                 31, 1994).

                               4.8               Warrant Agreement, dated as of
                                                 November 18, 1994, by and
                                                 between the Company and The
                                                 First National Bank of Boston.
                                                 (Incorporated by reference to
                                                 Exhibit 4.10 to the Company's
                                                 Report on Form 10-Q for the
                                                 quarter ended December 31,
                                                 1994).

                               10.1              Development and License
                                                 Agreement, dated as of August
                                                 1, 1996, by and between The R.
                                                 W. Johnson Pharmaceutical
                                                 Research Institute, the
                                                 Registrant and Alkermes
                                                 Controlled Therapeutics, Inc.
                                                 (Incorporated by reference to
                                                 Exhibit 10.1 to the Company's
                                                 Report on Form 8-K dated
                                                 November 14, 1996).*

                               10.2              Supply and License Agreement,
                                                 dated as of August 1, 1996, by
                                                 and between the R. W. Johnson
                                                 Pharmaceutical Research
                                                 Institute, the Registrant and
                                                 Alkermes Controlled
                                                 Therapeutics, Inc.
                                                 (Incorporated by reference to
                                                 Exhibit 10.2 to the Company's
                                                 Report on Form 8-K dated
                                                 November 14, 1996).*

                               10.3              License Agreement, dated as of
                                                 November 13, 1996, by and
                                                 between Genentech, Inc. and
                                                 Alkermes Controlled
                                                 Therapeutics, Inc.
                                                 (Incorporated by reference to
                                                 Exhibit 10.3 to the Company's
                                                 Report on Form 8-K dated
                                                 November 14, 1996).*

                               10.4              Omnibus Amendment to Loan
                                                 Documents, dated as of July 26,
                                                 1996, among the Registrant,
                                                 Alkermes Investments, Inc. and
                                                 The Sumitomo Bank, Limited (as
                                                 assignee of The Daiwa Bank,
                                                 Limited).
</TABLE>

                                      (14)
<PAGE>   15
<TABLE>
<CAPTION>
                               Number                   Exhibit
                               ------                   -------
<S>                            <C>               <C>
                               10.5              Second Amended and Restated
                                                 Note, dated July 26, 1996, by
                                                 the Registrant and Alkermes
                                                 Investments, Inc. to The
                                                 Sumitomo Bank, Limited.

                               11                Statement regarding computation
                                                 of per share loss.

                               27                Financial Data Schedule.
</TABLE>

*      Confidential status has been requested for certain portions thereof. Such
       provisions have been filed separately with the Commission.

(b)    The Registrant has filed no Reports on Form 8-K during the quarter ended
       December 31, 1996. A Report on Form 8-K dated November 14, 1996 was filed
       by the Registrant on January 3, 1997.

                                      (15)
<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.



                                       ALKERMES, INC.
                                       (Registrant)



Date:  January 17, 1997                By:    /s/  Richard F. Pops
                                            ----------------------
                                             Richard F. Pops
                                             Chief Executive Officer
                                               (Principal Executive Officer)


Date:  January 17, 1997                By:   /s/  Michael J. Landine
                                           -------------------------
                                             Michael J. Landine
                                             Senior Vice President, Chief
                                               Financial Officer and Treasurer
                                               (Principal Financial and
                                                  Accounting Officer)

                                      (16)
<PAGE>   17
                                  EXHIBIT INDEX


<TABLE>
<CAPTION>
                               Exhibit
                               Number            Description
                               ------            -----------
<S>                            <C>               <C>
                               3.1(a)            Second Amended and Restated
                                                 Articles of Incorporation, as
                                                 filed with the Pennsylvania
                                                 Secretary of State on July 23,
                                                 1991 (Incorporated by reference
                                                 to Exhibit 4.1(a) to the
                                                 Company's Report on Form 10-Q
                                                 for the quarter ended June 30,
                                                 1991).

                               3.1(b)            Statement of Change of
                                                 Registered Office, as filed
                                                 with the Pennsylvania Secretary
                                                 of State on July 23, 1991
                                                 (Incorporated by reference to
                                                 Exhibit 4.1(b) to the Company's
                                                 Report on Form 10-Q for the
                                                 quarter ended June 30, 1991).

                               3.1(c)            Amendment to the Second Amended
                                                 and Restated Articles of
                                                 Incorporation, as filed with
                                                 the Pennsylvania Secretary of
                                                 State on November 1, 1991.
                                                 (Incorporated by reference to
                                                 Exhibit 4.1(c) to the Company's
                                                 Report on Form 10-Q for the
                                                 quarter ended September 30,
                                                 1991).

                               3.1(d)            Amendment to the Second Amended
                                                 and Restated Articles of
                                                 Incorporation, as filed with
                                                 the Pennsylvania Secretary of
                                                 State on February 12, 1993.
                                                 (Incorporated by reference to
                                                 Exhibit 4.1(d) to the Company's
                                                 Report on Form 10-Q for the
                                                 quarter ended December 31,
                                                 1992).

                               3.2               Amended and Restated By-Laws of
                                                 Alkermes, Inc., effective as of
                                                 July 1, 1994. (Incorporated by
                                                 reference to Exhibit 4.2 to the
                                                 Company's Report on Form 10-Q
                                                 for the quarter ended June 30,
                                                 1994).

                               4.1               Specimen of Common Stock
                                                 Certificate of Alkermes, Inc.
                                                 (Incorporated by reference to
                                                 Exhibit 4 to the Company's
                                                 Registration Statement on Form
                                                 S-1, as amended (File No.
                                                 33-40250)).

                               4.2               Form of 1992 Warrant to
                                                 purchase 2,800 shares of the
                                                 Company's Common Stock.
                                                 (Incorporated by reference to
                                                 Exhibit 4.2 to the Company's
                                                 Report on Form 10-K for the
                                                 fiscal year ended March 31,
                                                 1992).

                               4.3               Form of 1995 Warrant to
                                                 purchase 300 shares of the
                                                 Company's Common Stock.
                                                 (Incorporated by reference to
                                                 Exhibit 4.3 to the Company's
                                                 Report on Form 10-K for the
                                                 fiscal year ended March 31,
                                                 1992).
</TABLE>

                                      (17)
<PAGE>   18
<TABLE>
<CAPTION>
                               Exhibit
                               Number            Description
                               ------            -----------
<S>                            <C>               <C>
                               4.4               Form of Global Warrant
                                                 Certificate for 1994 Class A
                                                 Warrants. (Incorporated by
                                                 reference to Exhibit 4.6 to the
                                                 Company's Report on Form 10-Q
                                                 for the quarter ended December
                                                 31, 1994).

                               4.5               Form of Global Warrant
                                                 Certificate for 1994 Class B
                                                 Warrants. (Incorporated by
                                                 reference to Exhibit 4.7 to the
                                                 Company's Report on Form 10-Q
                                                 for the quarter ended December
                                                 31, 1994).

                               4.6               Form of Global Warrant
                                                 Certificate for 1994 Affiliate
                                                 Warrants. (Incorporated by
                                                 reference to Exhibit 4.8 to the
                                                 Company's Report on Form 10-Q
                                                 for the quarter ended December
                                                 31, 1994).

                               4.7               Form of Global Warrant
                                                 Certificate for 1994 Incentive
                                                 Warrants. (Incorporated by
                                                 reference to Exhibit 4.9 to the
                                                 Company's Report on Form 10-Q
                                                 for the quarter ended December
                                                 31, 1994).

                               4.8               Warrant Agreement, dated as of
                                                 November 18, 1994, by and
                                                 between the Company and The
                                                 First National Bank of Boston.
                                                 (Incorporated by reference to
                                                 Exhibit 4.10 to the Company's
                                                 Report on Form 10-Q for the
                                                 quarter ended December 31,
                                                 1994).

                               10.1              Development and License
                                                 Agreement, dated as of August
                                                 1, 1996, by and between The R.
                                                 W. Johnson Pharmaceutical
                                                 Research Institute, the
                                                 Registrant and Alkermes
                                                 Controlled Therapeutics, Inc.
                                                 (Incorporated by reference to
                                                 Exhibit 10.1 to the Company's
                                                 Report on Form 8-K dated
                                                 November 14, 1996).*

                               10.2              Supply and License Agreement,
                                                 dated as of August 1, 1996, by
                                                 and between the R. W. Johnson
                                                 Pharmaceutical Research
                                                 Institute, the Registrant and
                                                 Alkermes Controlled
                                                 Therapeutics, Inc.
                                                 (Incorporated by reference to
                                                 Exhibit 10.2 to the Company's
                                                 Report on Form 8-K dated
                                                 November 14, 1996).*

                               10.3              License Agreement, dated as of
                                                 November 13, 1996, by and
                                                 between Genentech, Inc. and
                                                 Alkermes Controlled
                                                 Therapeutics, Inc.
                                                 (Incorporated by reference to
                                                 Exhibit 10.3 to the Company's 
                                                 Report on Form 8-K dated 
                                                 November 14, 1996).*

                               10.4              Omnibus Amendment to Loan
                                                 Documents, dated as of July 26,
                                                 1996, among the Registrant,
                                                 Alkermes Investments, Inc. and
                                                 The Sumitomo Bank, Limited (as
                                                 assignee of The Daiwa Bank,
                                                 Limited).
</TABLE>

                                      (18)
<PAGE>   19
<TABLE>
<CAPTION>
                               Exhibit
                               Number            Description
                               ------            -----------
<S>                            <C>               <C>
                               10.5              Second Amended and Restated
                                                 Note, dated July 26, 1996, by
                                                 the Registrant and Alkermes
                                                 Investments, Inc. to The
                                                 Sumitomo Bank, Limited.

                               11                Statement regarding computation
                                                 of per share loss.

                               27                Financial Data Schedule.
</TABLE>

*      Confidential status has been requested for certain portions thereof. Such
       provisions have been filed separately with the Commission.

                                      (19)