UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                        WASHINGTON, D.C.  20549
                                FORM 10-QSB

(Mark One)

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

For the quarterly period ended March 31, 1997

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

For the transition period from _______________to_________________.

                 Commission file number:  2-35700

                   Wasatch Pharmaceutical, Inc.
                   ----------------------------
               (Exact name of registrant as specified in charter)

           Utah                                      84-0854009
           ----                                      -----------
State or other jurisdiction of               (I.R.S. Employer I.D. No.)
incorporation or organization

714 East 7200 South, Midvale, Utah                          84047
----------------------------------                     --------------
(Address of principal executive offices)                  (Zip Code)

                          (801) 566-9688
                          --------------
          Issuer's telephone number, including area code

                          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).  Yes [X] No [ ] and (2) has been
subject to such filing requirements for the past 90 days. Yes [X] No [ ]

                        APPLICABLE ONLY TO CORPORATE ISSUERS:

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

     Class A Common Stock, $.001- 8,835,956 Outstanding as of March 31, 1997

<PAGE>


                  PART I - FINANCIAL INFORMATION

                  ITEM 1.  FINANCIAL STATEMENTS


     The  accompanying  unaudited  financial  statements  have been  prepared in
accordance  with the  instructions  to Form  10-QSB  pursuant  to the  rules and
regulations of the Securities and Exchange  Commission  and,  therefore,  do not
include all information and footnotes  necessary for a complete  presentation of
the financial  position,  results of operations,  cash flows, and  stockholder's
equity in conformity  with  generally  accepted  accounting  principles.  In the
opinion  of  management,   all  adjustments  considered  necessary  for  a  fair
presentation  of the results of  operations  and  financial  position  have been
included and all such adjustments are of a normal recurring nature.

     The unaudited  balance  sheet of the Company as of March 31, 1997,  and the
related  audited  balance  sheet of the Company as of  December  31,  1996,  the
unaudited  related  statements of operations  and cash flows for the three month
periods  ended March 31, 1997 and 1996 and from  inception  (September  7, 1989)
through  March 31, 1997,  are attached  hereto and  incorporated  herein by this
reference.

     Operating  results for the quarter ended March 31, 1997 are not necessarily
indicative of the results that can be expected for the year ending  December 31,
1997.

                                       2

<PAGE>


                          WASATCH PHARMACEUTICAL, INC.
                         (A Development Stage Company)
                          Consolidated Balance Sheets
<TABLE>
<CAPTION>


                                     ASSETS

                                              MARCH 31,            DECEMBER 31,
                                                1997                   1996
                                             (Unaudited)
              
CURRENT ASSETS
<S>                                         <C>                    <C>       
  Cash                                      $    1,202             $   11,991
  Accounts receivable - trade                    1,996                  2,925
  Accounts receivable - stockholder              6,600                  6,600
  Inventory                                      9,813                  8,586
                                            ----------             ----------
        Total Current Assets                    19,611                 30,102

PROPERTY AND EQUIPMENT

Oil and gas properties, successful
  efforts method                             3,743,227              3,719,536
Furniture and office equipment                  41,154                 39,749
                                            ----------             ----------
                                             3,784,381              3,759,285
    Less accumulated depreciation
      & depletion                              (18,259)               (15,668)
                                            ----------             ----------
    Net property and equipment               3,766,122              3,743,617
                                            ----------             ----------

OTHER ASSETS
  Deferred costs                                11,775                    600
  Investment                                     1,332                    750
                                            ----------             ----------
                                                13,107                  1,350
                                            ----------             ----------
          TOTAL ASSETS                      $3,798,840             $3,775,069
                                            ==========             ==========
</TABLE>


                                       3

<PAGE>

                          WASATCH PHARMACEUTICAL, INC.
                         (A Development Stage Company)
                    Consolidated Balance Sheets (Continued)

                 LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
<TABLE>
<CAPTION>



                                                    MARCH 31,      DECEMBER 31,
                                                      1997             1996
                                   (Unaudited)

CURRENT LIABILITIES

<S>                                              <C>              <C>        
  Cash overdraft                                 $     1,772      $       691
  Accounts payable - trade                           118,610          104,424
  Accrued physicians fees                             53,650           47,650
  Accounts payable related party                       6,500            6,500
  Joint operator payable                               5,535            8,011
  Royalties payable                                    1,027              883
  Accrued interest                                   182,903          161,226
  Accrued payroll taxes                               77,287           44,109
  Current portion of notes payable
    Vendors                                          112,333          117,333
    Stockholders                                     849,388          794,387
                                                 -----------      -----------
      Total Current Liabilities                    1,409,003        1,285,214

LONG TERM LIABILITIES
  Notes payable (less current portion)                 5,000            5,000
                                                 -----------      -----------
TOTAL LIABILITIES                                  1,414,003        1,290,214
                                                 -----------      -----------

STOCKHOLDERS' EQUITY (DEFICIT)

  Preferred stock, $0.001 par value,
    1,000,000 shares authorized, 49,258
    issued and outstanding                                49               49
  Common stock, $0.001 par value,
    50,000,000 shares authorized,
    8,835,956 shares issued
    and outstanding.                                   8,836            6,636
  Additional paid-in capital                       4,906,832        4,362,549
  Deficit accumulated during the
    development stage                             (1,710,880)      (1,584,379)
                                                 -----------      -----------
                                                   3,204,837        2,784,855
  Less note receivable stockholder                  (820,000)        (300,000)
                                                 -----------      -----------
      Total Stockholder's Equity (Deficit)         2,384,837        2,484,855
                                                 -----------      -----------
      TOTAL LIABILITIES AND STOCKHOLDERS'
       EQUITY (DEFICIT)                          $ 3,798,840      $ 3,775,069
                                                 ===========      ===========
</TABLE>


                                       4

<PAGE>

                          WASATCH PHARMACEUTICAL, INC.
                          (A Development Stage Company)
                      Consolidated Statement of Operations
<TABLE>
<CAPTION>


                                                   THREE MONTHS ENDED                 THROUGH
                                                        MARCH 31,                     MARCH 31,
                                                  1997                 1996             1997
                                               (Unaudited)          (Unaudited)      (Unaudited)

REVENUES
<S>                                          <C>                  <C>              <C>        
  Professional fee income                    $     7,248          $     8,208        $   153,114
  Product sales                                   14,999               25,291            321,077
  Oil and gas sales                                1,495                    0              4,516
                                             -----------          -----------        -----------

    Total Revenues                                23,742               33,674            478,707
                                             -----------          -----------        -----------
OPERATING EXPENSES
  Cost of goods sold                               1,019                1,807             38,313
  Salaries                                        18,503               34,895            201,582
  Payroll taxes                                    2,375                3,804             22,312
  Employee leasing                                     0                    0            218,745
  Physicians fees                                 10,200               14,400            164,668
  Rent                                             8,035                9,969            109,333
  Advertising                                      4,359                7,221            210,661
  Depreciation                                     1,687                1,777             18,887
                                             -----------          -----------        -----------
    Total                                         46,179               73,873            984,502
  General and administrative                      82,555               69,290            943,186
  Oil and gas expenses                             6,145                    0             17,982
                                             -----------          -----------        -----------
    Total Operating Expenses                     134,879              143,163          1,945,670
                                             -----------          -----------        -----------

INCOME (LOSS) BEFORE OTHER
  INCOME (EXPENSE) AND PROVISION
  FOR INCOME TAXES                              (111,138)            (109,489)        (1,466,964)
                                             -----------          -----------        -----------

OTHER INCOME (EXPENSES)
  Interest expense                               (21,821)             (17,144)          (199,847)
  Other - Net                                      6,458               (1,782)           (44,068)
                                             -----------          -----------        -----------
Total Other Expenses                             (15,363)             (18,926)          (243,915)
                                             -----------          -----------        -----------
NET INCOME (LOSS) BEFORE
  PROVISION FOR INCOME TAXES                    (126,501)            (128,590)        (1,710,879)
Provision for income taxes                             0                    0                  0
                                             -----------          -----------        -----------

NET INCOME (LOSS)                            $  (126,501)         $  (128,590)       $(1,710,879)
                                             ===========          ===========        ===========

NET INCOME (LOSS) PER SHARE
  OF COMMON STOCK                            $    (0.018)         $    (0.043)       $    (0.607)
                                             ===========          ===========        ===========

WEIGHTED AVERAGE NUMBER
  OF SHARES OUTSTANDING                        7,198,178            3,022,332          2,820,561
                                             ===========          ===========        ===========
</TABLE>


                                       5

<PAGE>

                          WASATCH PHARMACEUTICAL, INC.
                          (A Development Stage Company)
                      Consolidated Statement of Cash Flows
<TABLE>
<CAPTION>



                                                                       FROM
                                              FOR THE THREE          INCEPTION
                                               MONTHS ENDED            THROUGH
                                                  MARCH 31,           MARCH 31,
                                         1997              1996          1997
                                      (Unaudited)      (Unaudited)    (Unaudited)

CASH FLOWS FROM OPERATING
  ACTIVITIES
<S>                                   <C>               <C>            <C>         
  Net Income (Loss)                   $  (126,501)      $ (128,590)    $(1,710,879)

Adjustments to Reconcile Net
  Income(Loss) to Net Cash
  Provided (Used) by Operating
  Activities
    Depreciation                            2,591           1,777           20,957
    Expenses paid by shareholder                0               0           46,737
    (Increase) decrease in receivables        929          (1,414)          (1,996)
    (Increase) decrease in
      receivables-related parties               0               0           (6,600)
    (Increase) decrease in inventory       (1,227)         (4,477)          (9,813)
    Increase (decrease) in cash
      overdraft                             1,081          (1,155)           1,772
    Increase (decrease) in accounts
      payable                                                   0                0
      Trade                                14,186          22,211          118,610
      Physicians                            6,000           7,145           53,650
      Related party                             0               0            6,500
    Increase (decrease) in accrued
      interest                             21,677          23,726          235,906
    Increase (decrease) in other
      accrued expenses                     30,846               0           34,359
                                      -----------       ---------      -----------
      Net Cash Provided (Used) by
        Operating Activities              (50,418)        (80,777)      (1,210,797)
                                      -----------       ---------      -----------
CASH FLOWS FROM INVESTING ACTIVITIES
  Purchase of fixed assets                (25,096)              0          (51,056)
  (Increase) decrease in other assets     (11,757)              0          (12,357)
                                      -----------       ---------      -----------
       Net Cash Provided (Used) by
         Investing Activities             (36,853)              0          (63,413)
                                      -----------       ---------      -----------
</TABLE> 



                                       6

<PAGE>

                          WASATCH PHARMACEUTICAL, INC.
                          (A Development Stage Company)
                      Consolidated Statement of Cash Flows
                                  (Continued)
<TABLE>
<CAPTION>


                                                                                   FROM
                                                         FOR THE THREE           INCEPTION
                                                          MONTHS ENDED            THROUGH
                                                             MARCH 31,            MARCH 31,
                                                  1997                1996          1997
                                               (Unaudited)         (Unaudited)   (Unaudited)

CASH FLOWS FROM FINANCING ACTIVITIES
<S>                                          <C>                  <C>             <C>          
  Proceeds from loans                        $    55,000          $    80,000     $   1,089,452
  Repayment of loans                              (5,000)                   0          (130,947)
  Expenses paid with common shares                     0                    0             5,965
  Proceeds from sale of common shares                  0                    0           137,750
  Collection of share subscriptions               30,000                    0            30,000
  Capital contributed by shareholder                   0                    0           154,800
  Common shares exchanged for debt                     0                    0            12,318
  Redemption of common shares                          0                    0           (20,409)
  Costs of raising funds                          (3,517)                   0            (3,517)
                                             -----------          -----------     ------------- 
    Net Cash Provided (Used) by
      Investing Activities                        76,483               80,000         1,275,412
                                             -----------          -----------     -------------
NET INCREASE (DECREASE) IN
  CASH AND CASH EQUIVALENTS                      (10,788)                (777)            1,202

CASH AND CASH EQUIVALENTS
  AT BEGINNING OF PERIOD                          11,990                  777                 0
                                             -----------          -----------     -------------
CASH AND CASH EQUIVALENTS
  AT END OF PERIOD                           $     1,202          $         0     $       1,202 
                                             ===========          ===========     =============
SUPPLEMENTAL DISCLOSURE OF CASH
  FLOW INFORMATION
  Cash paid for interest                     $       114          $         0     $      11,718
  Cash paid for taxes                        $         0          $         0     $           0
SUPPLEMENTAL SCHEDULE FOR NON-CASH
  INVESTING AND FINANCIAL ACTIVITIES
Common shares issued for assets acquired
  Clinical equipment and fixtures            $        0           $         0     $      13,790
  Oil and gas properties                     $        0           $         0     $   3,719,536
  Preferred stock of insurance               $        0           $         0     $         750
  Common share subscription notes            $  550,000           $         0     $     850,000
</TABLE>


                                       7

<PAGE>


                          WASATCH PHARMACEUTICAL, INC.
                         (A Development Stage Company)
                 Notes to the Consolidated Financial Statements
                      March 31, 1997 and December 31, 1996

NOTE 1 - NATURE AND HISTORY OF THE BUSINESS

        These   consolidated   financial   statements   are  those  of   Wasatch
Pharmaceutical, Inc. (A Development Stage Company) (the Company), and its wholly
owned subsidiaries,  Medisys Research Group, Inc. and American Institute of Skin
Care,  Inc. The Company was  initially  engaged in oil and gas  exploration  and
development  and returned to that line of business with an investment in oil and
gas  properties in November  1996.  The Company's  primary  business  segment is
described  below.  In December  1995,  the  Company  (formerly  Ceron  Resources
Corporation; a dormant Delaware Corporation) merged with Medisys Research Group,
Inc. and its wholly owned  subsidiary  American  Institute of Skin Care, Inc. In
January 1996 the Company was reincorporated in Utah.

        On December 29, 1995 Wasatch Pharmaceutical,  Inc. (Wasatch) and Medisys
Research Group, Inc. (Medisys) completed an Agreement and Plan of Reorganization
whereby Wasatch issued 10,312,216 (on a 1 share for 1 share basis) shares of its
common stock in exchange for all of the issued and  outstanding  common stock of
Medisys. Pursuant to the reorganization,  the name of the Company was changed to
Wasatch Pharmaceutical,  Inc. The acquisition was accounted for as a purchase by
Medisys of Wasatch,  because  the  shareholders  of Medisys  control the company
after the  acquisition  and,  therefore,  Medisys is  treated  as the  acquiring
entity.  Wasatch is the acquiring  entity for legal  purposes and Medisys is the
surviving entity for accounting purposes.

        Medisys Research Group, Inc. (Medisys), was incorporated on September 7,
1989 (the inception of the Company's  development  stage) as a Utah  Corporation
for the purpose of  developing  treatment  programs for various skin  disorders.
American  Institute of Skin Care, Inc.  (AISC),  was incorporated on January 21,
1994 as a Utah corporation to administer the skin treatment  programs  developed
by Medisys.

NOTE 2 - COMMON STOCK

        During the first  quarter the  following  common  share and common share
option transactions occurred:
        a. On March 8,  1997,  five  Directors  and one former  Director  of the
        company  were  each  issued   200,000   restricted   common   shares  in
        consideration  for a non recourse  promissory  note for  $50,000,  b. On
        March 8, 1997,  two  principal  officers of the company were each issued
        500,000  restricted  common shares in  consideration  for a non recourse
        promissory note for $125,000,  c. Common share subscription  obligations
        of $30,000 were paid during the quarter.



                                       8

<PAGE>


                          WASATCH PHARMACEUTICAL, INC.
                         (A Development Stage Company)
                 Notes to the Consolidated Financial Statements
                      March 31, 1997 and December 31, 1996


NOTE 3 - GENERAL AND ADMINISTRATIVE EXPENSES

        General and  administrative  expenses  for the  comparative  three month
period and from inception through March 31, 1997 are:

                                                         Inception
                               First Quarter             to March
                            1997         1996             31, 1997

Officer's Compensation   $  32,825    $  34,580          $  415,409
Legal and accounting        15,776       13,200             190,533
Travel                       4,995        4,614              39,355
Telephone                    4,261        2,786              39,595
Insurance                      162        1,234               4,544
Other                       24,536       12,826             255,750

                         $  82,555    $  69,290          $  943,186

NOTE 4 - GOING CONCERN

        The Company's financial statements are prepared using generally accepted
accounting  principles  applicable  to a going concern  which  contemplates  the
realization  of assets and  liquidation  of  liabilities in the normal course of
business.  However,  the  Company  is in  the  development  stage  and  has  not
established  a source of revenues  sufficient to allow it to continue as a going
concern. The Company is negotiating an agreement to raise short-term funding and
plans to seek long-term  funding through a stock offering.  Management  believes
that  sufficient  funding  will be  raised  to meet the  operating  needs of the
Company during the remainder of development stage.

NOTE 4 - CHANGES IN PRESENTATION

        Certain financial  presentations for the first quarter of 1996 have been
reclassified to conform to the 1997 presentation.

NOTE 5 - SUBSEQUENT EVENTS

        On May 1, 1997, the Company rescinded a private placement agreement with
Lindbergh-  Hammar  Associates,  Inc.  (Lindbergh),  whereby  Lindbergh  was  to
purchased  12,000,000 shares of common stock of the Company at $5 per share on a
promissory  note payable over a five year period in monthly amounts equal to ten
percent  (10%) of the  Insurance  Premium  income  generated  as a result of the
Company's stock being assigned to the capital and surplus account of Lindbergh.

                                       9

<PAGE>

                  ITEM 2.  MANAGEMENT DISCUSSION AND ANALYSIS
               OF FINANCIAL CONDITIONS AND RESULTS OF OPERATIONS

PLAN OF OPERATION

Skin Care Business

     The Company owns the  proprietary  technology  for the treatment of various
common skin disorders, including acne, eczema, and psoriasis . As a follow-up to
previous clinical studies, prototype clinics were established two years ago with
the goal of duplicating  the success rates  achieved in clinical  studies and to
establish  medical,   business  and  administrative  procedures  that  could  be
duplicated in clinics across the country.  The two prototype  treatment  clinics
are  currently  in operation in Utah.  Although  the Company has  confirmed  the
technology  through the  successful  treatment of hundreds of patients  over the
last three years and has set up the business and administrative  procedures, the
clinics  have not  reached  a  profitable  level  due to the  lack of funds  for
advertising and marketing. At this time, the Company does not have the resources
to fully  implement  a plan for the  development  and  expansion  of its  clinic
operation.  Due to lack of working capital,  the Company's financial  statements
contain a "going  concern"  disclosure  which places into question the Company's
ability to continue  without  substantial  increases  in revenues or  additional
long-term financing.

     The  Company  is  seeking  funding  to  open  two  more  clinics  in  major
metropolitan  areas and to launch a major advertising and marketing  campaign to
support each of the clinics.  Management  feels that the advertising and working
with health insurance  companies and HMOs,  supplemented by a physician referral
program would increase revenues above the break-even point.

Oil and Gas Operations

     In the fourth quarter of 1996, the Company acquired a substantial  interest
in proven reserves in West Virginia.  In order to realize the full potential for
the asset,  substantial  resources  will be required to improve  production  and
recomplete  previously  drilled oil and gas wells.  The Company's joint interest
operator is in the process of raising  the funds to commence  the  redevelopment
process.

LIQUIDITY AND CAPITAL RESOURCES

     At March 31,  1997,  the Company had current  assets of $19,611 and current
liabilities of $1,409,003, resulting in a working capital deficit of $1,389,392,
which is a 10%  increase in the working  capital  deficit.  The  increase in the
deficit is due primarily to the Company's  operating loss which was $126,501 for
the three  month  period  ended March 31,  1997.  The  majority of expenses  are
related to the operation of the Company's two prototype clinics and the expenses
of raising funds to expand its base of operating clinics.

     For the three  months ended March 31, 1997,  the  clinics'  operating  loss
decreased  $16,267 to $23,962 when compared to the same quarter last year, which
was offset by  increases in General &  Administrative  expenses of $13,265 and a
new Oil & Gas expenditure of $6,458. From inception to date, the majority of the
expenses have been associated with the development of the treatment  process for
the clinics.

     During the first  quarter of 1997,  the Company has expended  approximately
$50,000  in  completing  the oil and gas  acquisition  and in  efforts  to raise
additional operating capital.

                                       10

<PAGE>

RESULTS OF OPERATION

Skin Care Business

     During the three months ending March 31, 1997,  the Company had revenues of
$23,742  compared to $33,674 during the same three months of 1996, a decrease of
$9.932.  There are two  reasons for this  decrease in revenue.  During the first
three months of 1996, the Company had three prototype clinics generating revenue
from operations.  The Company closed its clinic in Pocatello, Idaho in February,
1996.  The  Company's  clinic  operating  expenses  decreased by 6% in the three
months of 1997 as compared to the three  months of 1996.  due to a reduction  in
salaries and other overhead expenses. The Company's corporate expenses increased
substantially  due to increased legal,  accounting and  administrative  expenses
that were  associated  with fund raising  activities and the additional  cost of
being a fully reporting public entity.

     The Company  anticipates  that the losses will  continue  until  funding is
obtained which will be used to launch the marketing program.

Oil and Gas Operations

        During the first quarter of 1997,  there was no significant  progress in
the redevelopment of the Company's West Virginia oil and gas properties. Revenue
and expenses were minimal, $1,495 and $6,145, respectively.

                   ITEM 1.  LEGAL PROCEEDINGS

     None.

                  ITEM 2.  CHANGES IN SECURITIES

        During the first  quarter the  following  common  share and common share
option transactions occurred:
        a. On March 8,  1997,  five  Directors  and one former  Director  of the
        company  were  each  issued   200,000   restricted   common   shares  in
        consideration  for a non recourse  promissory  note for  $50,000,  b. On
        March 8, 1997,  two  principal  officers of the company were each issued
        500,000  restricted  common shares in  consideration  for a non recourse
        promissory note for $125,000,  c. Common share subscription  obligations
        of $30,000 were paid during the quarter.

        The  common  shares  were  issued  in  reliance  on the  exemption  from
registration  provided  by Section 4 (2) of the  Securities  Act of 1934 and the
"Safe Harbor" of Regulation D, Rule 504.


            ITEM 3.  DEFAULTS UPON SENIOR SECURITIES

     None.

                                       11
<PAGE>

            ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITIES HOLDERS


     None.

            ITEM 5.  OTHER INFORMATION

     None.


            ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K


     (a)  Exhibits.

            SEC
Exhibit     Reference
No.         No.            Description                             Location
-------     ---------      -----------                             --------

10:01       10             Cancellation letter
                           from the Company to
                           Lindbergh-Hammar Assoc.               This Filing

10.02       10             Resolution of the Board
                           of Directors authorizing the
                           issuance of 2.2 million restricted
                           common shares for non-recourse
                           notes.                                This Filing

10.03       10             Sample of non-recourse notes
                           signed by officers and directors.     This Filing


     (b)   Reports on Form 8-K

     None


                                       12

<PAGE>
                            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.

                              WASATCH PHARMACEUTICAL, INC.
                              [Registrant]


Dated: May 15, 1997


/S/David K. Giles
-----------------------------
David K. Giles
Principal Accounting Officer


                                       13