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                     U.S. SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                  -------------

                                   FORM 10-QSB



   [X] QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE
                                   ACT OF 1934
                  For the quarterly period ended March 31, 1998

                                       or

                    [ ] TRANSITION REPORT UNDER SECTION 13 OR
                     15 (d) OF THE EXCHANGE ACT OF 1934 For
                          the transition period from to

                                  -------------

                        Commission file number: 333-34765


                           Ixion Biotechnology, Inc..
        (Exact Name of Small Business Issuer as Specified in Its Charter)


                                  -------------

          Delaware                                        59-3174033 
  (State of incorporation)                (I.R.S.  Employer  Identification No.)
                              12085 Research Drive
                                Alachua, FL 32615
                    (Address of principal executive offices)

                   Registrant's telephone number: 904-418-1428

                                                    -------------

Check whether the issuer:  (1) filed all reports required to be filed by Section
13 or 15(d) of the  Exchange  Act during the past 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


The  number of shares of the  registrant's  common  stock,  par value  $0.01 per
share, outstanding as of April 13, 1998 was 2,472,194.

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<PAGE>


                            Ixion Biotechnology, Inc
                               Index to Form 10QSB


Part 1 - Financial Information                                            Page
                                                                          ----

Item 1.  Financial Statements (unaudited)

         Condensed Balance Sheet - March 31, 1998..........................2

         Condensed  Statements of Operations - Three 
         Months Ended March 31, 1998
         and 1997 and for the period March 25, 1993
         (Date of Inception) through March 31, 1998........................3

         Condensed  Statements of Cash Flows - Three 
         Months Ended March 31, 1998
         and 1997 and for the period March 25, 1993
         (Date of Inception) through March 31, 1998........................4

         Notes to Condensed Financial Statements...........................5

Item 2.  Management's Discussion and Analysis of 
         Financial Condition and Results of 
         Operations or Plan of Operation...................................6

Part II - Other Information

Item 6.  Exhibits and Reports on Form 8-K..................................10

Signatures.................................................................10




<PAGE>

Part I.  Financial Information
Item 1.  Financial Statements

Balance Sheet
March 31, 1998
Unaudited

                                     Assets
Current  Assets:
   Cash and cash equivalents                                           $ 24,591
   Accounts receivable                                                    1,770
   Prepaid expenses                                                         981
   Other current assets                                                     500
                                                                       --------
                 Total current assets
                                                                         27,842

Property and Equipment, net                                              32,592

Other Assets:
    Patents and patents pending, net                                    220,017
    Other
                                                                          7,566
                 Total other assets                                     227,120
                                                                       --------
                  Total Assets                                         $288,017
                                                                       ========

                       Liabilities and Capital Deficiency

Current Liabilities:
    Accounts payable                                                 $   52,679
    Current portion of notes payable                                     85,770
    Accrued expenses                                                     49,249
                                                                     ----------
         Total current liabilities                                      187,698

Long-Term Liabilities:
    Notes payable                                                       595,542
    Liability under research agreement                                   42,317
    Deferred rent, including accrued interest                            10,123
    Deferred fees and salaries, including accrued interest              535,869
                                                                     ----------
                   Total long-term liabilities
                                                                      1,183,851
                     Total liabilities
                                                                      1,371,549

Capital Deficiency:
    Common stock, $.01 par value; authorized 4,000,000, 
       issued and outstanding 2,471,694 shares at March 31               24,717
    Common stock warrants outstanding                                    35,494
    Additional paid-in capital                                        1,222,973
    Deficit accumulated during the development stage                 (2,213,068)
    Less unearned compensation                                         (153,648)
                                                                    -----------
                  Total capital deficiency
                                                                     (1,083,532)

Total Liabilities and Capital Deficiency                            $   288,017
                                                                    ===========

See accompanying notes to condensed financial statements


<PAGE>

<TABLE>
<CAPTION>

                                                                       For the Period
                                                                          March 25,
Statements of Operations                                                 1993 (Date
                                                                        of inception)
                                               Three Months Ended         through
                                                   March 31,             March 31,
                                           __1998__        __1997__     ____1998____
                                                  Unaudited              Unaudited
Revenues:
<S>                                       <C>            <C>            <C> 

   Income under research agreement        $         0    $    87,312    $   275,001
   Income from SBIR Grant                           0              0         91,650
   Interest income                                146          4,435         23,113
   Other income                                   981            899         15,529
                                           -----------    -----------     -----------
            Total revenues                      1,127         92,646        405,293
                                           -----------    -----------     -----------
                                                                           

Expenses:
  Operating, general and administrative       118,884        104,832      1,216,994
  Research and development                     87,562        138,217      1,173,693
  Interest                                     28,390         13,154        227,674
                                           -----------    -----------    -----------
                                                                    
                 Total expenses               234,836        256,203      2,618,361
                                           -----------    -----------    -----------
                                                                          

Net Loss                                  $  (233,709)   $  (163,557)   $(2,213,068)
                                            ===========    ===========   ===========
                                                                         

Net Loss per Share (Basic)                $     (0.10)   $     (0.07)
                                            ===========    ===========

Weighted Average Common Shares              2,460,070      2,449,411
                                            ===========    ===========


</TABLE>




















See accompanying notes to condensed financial statements


<PAGE>


Statements of Cash Flows
<TABLE>
<CAPTION>
                                                                                              For the Period
                                                                                              March 25, 1993
                                                                        Three Months        (Date of inception)
                                                                       Ended March 31,            through
                                                                 __1998__          __1997__   March 31, 1998
                                                                         Unaudited              Unaudited
Cash Flows from Operating Activities:
<S>                                                              <C>            <C>            <C>   

    Net loss                                                     $  (233,709)   $  (163,557)   $(2,213,068)
    Adjustments to reconcile net loss to net cash used in
        operating activities:
         Depreciation                                                  3,104          2,787
                                                                                                    27,504
         Amortization                                                    713            791
                                                                                                     4,557
         Amortization of debt discount                                14,292           --
                                                                                                    90,516
         Stock warrants issued under license agreement                  --             --
                                                                                                    20,465
         Stock options/warrants issued for consulting services          --             --
                                                                                                    30,000
         Stock compensation                                           23,840         28,600        280,653
         Decrease (increase) in prepaid expenses and
                other current assets                                     421          4,079
                                                                                                    (1,306)
         Decrease (increase) in accounts receivable                     --          (30,851)
                                                                                                    (1,770)
         Increase (decrease) in deferred revenue                        --          (50,000)
                                                                                               -----------
         Increase (decrease) in liability under
                research agreement                                      --             --
                                                                                                    42,317
         Increase (decrease) in accounts payable and
                accrued expenses                                       7,405         10,360        102,598
         Increase in deferred fees and salaries                       59,453          7,609
                                                                                                   509,317
         Increase in deferred rent                                     3,637           --
                                                                                                    10,123
         Increase in interest payable                                   --             --
                                                                                -----------    -----------
                                                                                                    33,198
                  Net cash used in operating activities             (120,844)      (190,182)
                                                                                -----------    -----------
                                                                                                (1,064,896)

Cash Flows from Investing Activities:
     Purchase of property and equipment                                 --           (1,161)
                                                                                                   (31,897)
     Organization Costs                                                 --             --
                                                                                                      (436)
     Payments for patents and patents pending                         (3,671)       (46,317)
                                                                                -----------    -----------
                                                                                                  (213,441)
                  Net cash used in investing activities               (3,671)       (47,478)
                                                                                -----------    -----------
                                                                                                  (245,774)

Cash Flows from Financing Activities:
     Proceeds from issuance of subordinated notes
         payable to related parties                                     --             --
                                                                                                   105,307
     Proceeds from issuance of convertible notes payable                --             --
                                                                                                   787,270
     Proceeds from issuance of common stock                          145,500           --
                                                                                                   568,200
     Principal reductions in notes payable                            (2,692)          --
                                                                                                   (13,662)
     Payment of deferred offering costs                              (38,145)          --
                                                                                                  (100,774)
     Payment of loan costs                                              --             --
                                                                                -----------    -----------
                                                                                                   (11,080)
                  Net cash provided by (used in)
                        financing activities                         104,663           --
                                                                                -----------    -----------
                                                                                                 1,335,261

Net Increase (Decrease) In Cash and Cash Equivalents                 (19,852)      (237,659)        24,591

Cash and Cash Equivalents at Beginning of Period                      44,443        611,539
                                                                                -----------    -----------
                                                                                               -----------
Cash and Cash Equivalents at End of Period                       $    24,591    $   373,880    $    24,591
                                                                 ===========    ===========    ===========
</TABLE>

See accompanying notes to condensed financial statements

<PAGE>


 Notes to Condensed Financial Statements
Three Month Period Ended March 31, 1998

1.   Basis Of Presentation:

     The accompanying  unaudited  condensed  financial  statements for the three
     months  ended  March 31,  1998 and 1997 and for the period  March 25,  1993
     (date of inception) through March 31, 1998 have been prepared in accordance
     with  generally  accepted  accounting   principles  for  interim  financial
     information.  Accordingly,  they do not  include  all the  information  and
     footnotes required by generally accepted accounting principles for complete
     financial statements.  These interim financial statements should be read in
     conjunction  with the December 31, 1997  financial  statements  and related
     notes  included in the Company's  Annual Report on Form 10-KSB for the year
     ended  December 31, 1997. In the opinion of the Company,  the  accompanying
     unaudited   condensed   financial   statements   contain  all  adjustments,
     consisting only of normal recurring  accruals,  necessary to present fairly
     the Company's financial position, results of operations, and cash flows for
     the periods  presented.  The results of operations  for the interim  period
     ended March 31, 1998 are not  necessarily  indicative  of the results to be
     expected for the full year.

2.   Income Taxes:

     The  components of the Company's net deferred tax asset and the tax effects
     of the primary temporary  differences giving rise to the Company's deferred
     tax asset are as follows as of March 31, 1998:

             Deferred compensation             $ 212,000
             Net operating loss carryforward     662,000
                                                 ------
             Deferred tax asset                  874,000
             Valuation allowance               $(874,000)
                                                 ------

             Net deferred tax asset            $ __0_ _
                                                 ======

3.    Stockholder's Equity

     In  December,  1997,  the Company  commenced  the public  offering of up to
     400,000 Units of  newly-issued  securities  for an aggregate of $4,000,000.
     Each Unit consists of one share of Common Stock, $0.01 par value, and a .25
     Charitable Benefit Warrants. Each whole Charitable Benefit Warrant entitles
     the holder to purchase  one share of the Common  Stock at a price of $20.00
     per share. The Company requires the proceeds of the public offering to meet
     its planned operating  requirements  through December 31, 1998. The Company
     had received proceeds of $155,500 through March 31, 1998. The offering will
     continue until all Units have been sold or until December 10, 1998,  unless
     sooner  terminated or extended.  If the proceeds from the offering prove to
     be  insufficient,  then the Company would be required to obtain  additional
     funds through equity or debt financing,  strategic alliances with corporate
     partners, or through other sources.

     There can be no assurance  that the Company will be successful in obtaining
     the required financing. Under current circumstances,  the Company's ability
     to continue as a going concern depends upon obtaining additional financing.

     Deferred  offering  costs of $100,774 have been offset against the proceeds
     of the offering through March 31, 1998.

     In February of 1998, 8,400 shares of stock previously issued to an employee
     in exchange for services to be rendered  were  returned to the Company when
     the employee  resigned.  This resulted in a reversal of paid-in capital and
     unearned compensation, but had no net effect on capital deficiency.

4.    Related Party Transactions

     In 1997, the Company  engaged the services of a printer in connection  with
     its public  offering.  The  printer  is  partially-owned  by the  Company's
     President,  who is also CEO of the printer.  Through  March 31,  1998,  the
     printer has charged $8,752 in connection with its services.

5.    Subsequent Events
     Through May 12,  1998,  the Company  has  received  proceeds of $185,500 by
     selling 18,550 units of Common Stock and Charitable Benefit Warrants in its
     initial public offering at $10.00 per unit

<PAGE>


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

         The following  discussion  and analysis  should be read in  conjunction
with the Financial  Statements and the related Notes thereto included  elsewhere
in this report.  This report  contains  forward-looking  statements that involve
risks and uncertainties.  The Company's actual results may differ  significantly
from  the  results  discussed  in  the  forward-looking  statements.  These  and
additional  risk factors are  identified in our annual report to the  Securities
and Exchange Commission filed on forms 10-KSB and in other SEC filings.


Overview

         The Company is a development stage,  biotechnology company. The Company
is  considered  to  be  in  the   development   stage  because  it  is  devoting
substantially  all of its efforts to  establishing  its business and its planned
principal operations have not commenced.

         Since its inception in March of 1993,  the Company's  efforts have been
principally devoted to research and development, securing patent protection, and
raising  capital.  The Company has not received  any  revenues  from the sale of
products.  The Company expects its initial product, a molecular diagnostic test,
the Ixion  Oxalobacter  formigenes  Monitor,  will generate revenue during 1998;
however  it  does  not  expect  any  of  its  other  product  candidates  to  be
commercially  available  for at least the next  several  years.  From  inception
through  March  31,  1998,  the  Company  has  sustained  cumulative  losses  of
$2,213,068.  These losses have resulted primarily from expenditures  incurred in
connection with general and administrative activities, research and development,
patent preparation and prosecution, and interest.

         The  Company  expects to  continue to incur  substantial  research  and
development  costs in the future resulting from ongoing research and development
programs,  manufacturing  of products for use in clinical trials and preclinical
and clinical  testing of the Company's  products.  The Company also expects that
general  and  administrative  costs,  including  patent  and  regulatory  costs,
necessary to support clinical trials,  research and development,  manufacturing,
and the  creation of a marketing  and sales  organization,  if  warranted,  will
increase in the future.  Accordingly,  the Company  expects to incur  increasing
operating losses for the foreseeable future.  There can be no assurance that the
Company will ever achieve profitable operations.

         The  Company  has  only a  limited  operating  history  upon  which  an
evaluation of the Company and its prospects  can be based.  The risks,  expenses
and difficulties  encountered by companies at an early stage of development must
be considered when evaluating the Company's  prospects.  To address these risks,
the Company must, among other things, successfully develop and commercialize its
product  candidates,   secure  all  necessary  proprietary  rights,  respond  to
competitive developments, and continue to attract, retain and motivate qualified
persons.  There can be no  assurance  that the  Company  will be  successful  in
addressing these risks.

         The operating  expenses of the Company will depend on several  factors,
including  the  level  of  research  and  development  expenses.   Research  and
development  expenses  will depend on the progress and results of the  Company's
product development efforts, which the Company cannot predict. Management may in
some cases be able to  control  the timing of  development  expenses  in part by
accelerating or decelerating  preclinical testing and clinical trial activities.
As a  result  of these  factors,  the  Company  believes  that  period-to-period
comparisons  in the  future  are not  necessarily  meaningful  and should not be
relied upon as an indication of future performance.  Due to all of the foregoing
factors,  it is possible that the Company's  operating results will be below the
expectations  of market  analysts,  if any, and  investors.  In such event,  the
prevailing  market price, if any, of the Common Stock would likely be materially
adversely affected.

Results of Operations

         The Company's revenues under the GI research  agreement  decreased from
$87,312  in the first  three  months of 1997 to $0 in 1998.  Revenues  under the
Genetics Institute agreement ceased at the end of the agreement in 1997.

         Interest income  decreased 97% from $4,435 in the first three months of
1997 to $146 in the first three months of 1998.  This decrease was  attributable
to the expenditure of the proceeds from the sale of Unsecured  Convertible Notes
in the last quarter of 1996,  which were invested  during 1997.  Interest income
relating to the proceeds of the Unsecured  Convertible Notes will cease in 1998,
but will be replaced,  in part,  with income from the investment of the proceeds
of the Company's public offering of Units in 1998.

         Operating,  general and  administrative  expenses  increased 13.4% from
$104,832 in the first three months of 1997 to $118,884 in the equivalent  period
of 1998.  These increased  expenses  reflect  increased  personnel and increased
legal  expenses  in the first three  months of 1998  compared to the first three
months of 1997. The Company  expects its general and  administrative  expense to
increase  during  1998  as a  result  of the  hiring  of  additional  personnel,
increased  amortization  of capitalized  patent costs as new patents are issued,
continued  amortization of capitalized private placement expenses, and increased
legal and  accounting  expenses  resulting  from filings with the Securities and
Exchange Commission under the Securities Exchange Act of 1934.

          Research   and   development   expenditures   consist   primarily   of
payroll-related  expenses  of research  and  development  personnel,  laboratory
supplies,   animal  supplies,   laboratory  rent,   depreciation  on  laboratory
equipment, development activities, payments for sponsored research, and payments
to scientific  and regulatory  consultants.  Research and  development  expenses
decreased  36.6% from  $138,217  in the first  quarter of 1997 to $87,562 in the
first  quarter  of 1998,  primarily  as a result  of a  temporary  reduction  in
research and development  personnel and  concomitant  reduction in lab supplies.
The Company anticipates that its research and development expenses will increase
during the  remainder of 1998 as the Company  expands  research and  development
programs and  preclinical  and clinical  testing for its product  candidates and
technologies under development.

          Interest  expense  increased  115.8 % from  $13,154 in the first three
months of 1997 to $28,390 in the first  three  months of 1998 due  primarily  to
cash  interest on the  Company's 10% Notes,  the  amortization  of debt discount
(initially  $285,835)  attributable to the beneficial  conversion feature of the
Company's  Variable Notes, both issued in the last quarter of 1996,  interest on
working  capital  loans,  and the  compounding  of interest on deferred fees and
salaries,  including  deferred  interest,  payable to related parties.  Interest
expense  will  continue to increase  during 1998,  as a result of the  continued
compounding  of interest on deferred fees and salaries  accounts and  additional
working capital loans the Company expects to incur..

Liquidity and Capital Resources

         In December, 1997, the Company commenced the public offering of 400,000
Units of newly issued  securities,  for an aggregate  of  $4,000,000.  Each Unit
consists  of one share of Common  Stock,  $0.01 par  value,  and .25  Charitable
Benefit Warrants.  Each whole Charitable  Benefit Warrant entitles the holder to
purchase one share of Common Stock at a price of $20.00 per share.  The Offering
is being made in nine  states,  primarily  over the  Internet,  directly  by the
Company,  except in Florida where sales must be made through a broker.  There is
no minimum  number of Units to be sold in the Offering,  and all funds  received
will go  immediately  to the Company.  The offering will be terminated  upon the
earliest of: the sale of all Units, December 10, 1998 (unless extended),  or the
date on which the Company  decides to close the  offering.  At March 31, 1998, a
total of 15,550 Units ($155,500) had been sold pursuant to the offering.

         During 1997, the Company's development activities were funded primarily
by a private placement  transaction in which it sold Unsecured Convertible Notes
for an aggregate gross consideration of $787,270. In addition,  the Chairman and
Chief  Executive  Officer and the  President of the Company have entered into an
agreements to extend the Company up to $150,000 and up to $25,000, respectively,
in the form of bridge loans.  Interest on the loans is at 6.54% but can be reset
annually,  at the  election  of either  party,  to the  prime  rate in effect on
January 1 of any given  year,  plus 3%.  Under  these  agreements,  the  Company
borrowed a total of $75,000,  which was still outstanding at March 31, 1998. The
Company expects to borrow and repay under these  facilities from time to time to
meet  working  capital  needs.  The  Company  does not  have any bank  financing
arrangements.   The  Company's  long-term  indebtedness  consists  primarily  of
deferred fees and salaries payable to related individuals and a chattel mortgage
agreement.

         At  March  31,  1998,   the  Company  had  $24,591  in  cash  and  cash
equivalents.  Until required for operations,  the Company's  policy is to invest
its cash reserves in bank deposits, money market funds, certificates of deposit,
commercial  paper,  corporate  notes,  U.S.  government  instruments  and  other
investment-grade quality instruments.

         On January 1, 1996, the Company purchased laboratory equipment pursuant
to a chattel  mortgage  agreement in the amount of $32,309.  The agreement calls
for monthly  payments of $897,  commencing  August 1, 1996.  At March 31,  1998,
$14,359 in principal remains outstanding under this agreement..

         For the period  March 25, 1993 (date of  inception)  through  March 31,
1998, the Company made payments of  approximately  $221,800  associated with the
prosecution of various patent  applications.  As further research  continues and
the  Company  acquires   additional  patent  rights,   management   expects  the
patent-related payments to increase.

         In connection with the GI sponsored research agreement described above,
certain  patent-related  expenses were paid by the Company and reimbursed by GI.
The Company is  contractually  obligated to repay these  reimbursed  expenses in
installments  over a 36 month period upon a determination  by GI not to exercise
an option contained in the sponsored research  agreement.  Reimbursement has not
commenced,  and the Company has accrued $42,317 as a long term liability pending
final action under the agreement.

         Through March 31, 1998, the Company had paid offering-related  expenses
of $100,774 which have been applied against the proceeds of the public offering.

         On August 1,  1998,  upon the  expiration  of its  current  lease,  the
Company will relocate to comparable  rental facilities near its present location
at rents per square foot which are not expected to be  materially  more than its
current  rent.  The Company  will  continue to have access to the  Biotechnology
Development Institute's specialized facilities,  centralized equipment, and core
laboratories.  Relocation will not materially affect the Company's  research and
development  operations;  however, the Company will have relocation expenses and
will be obliged to  purchase  or lease  laboratory  and office  furnishings  and
equipment currently available under its lease with the Biotechnology Development
Institute.  The Company  estimates  that the  principal  amount of such lease or
purchase is $40,000.

         The Company has incurred  negative cash flows from operations since its
inception,  and has  expended  and  expects to continue to expend in the future,
substantial funds to complete its planned product development efforts,  commence
clinical  trials,  and diversify its  technology.  The Company's  future capital
requirements  and the  adequacy  of  available  funds  will  depend on  numerous
factors,  including  the  successful   commercialization  of  the  XEntrIx  (TM)
Oxalobacter   formigenes   Monitor  (the  Company's  new  diagnostic  test)  and
IxC1-62/47 (the Company's lead  therapeutic  compound),  progress in its product
development  efforts,  the magnitude  and scope of such  efforts,  progress with
preclinical studies and clinical trials, the cost of contract  manufacturing and
research  organizations,  cost of filing,  prosecuting,  defending and enforcing
patent claims and other intellectual  property rights,  competing  technological
and market  developments,  and the  development  of strategic  alliances for the
development and marketing of its products.  The Company requires the proceeds of
the public  offering  commenced in December  1997 to meet its planned  operating
requirements  through December 31, 1998. In the event the Company's plans change
or its  assumptions  change or prove to be  inaccurate  or the  proceeds  of the
offering  prove to be  insufficient  to fund  operations  (due to  unanticipated
expenses,  delays, problems or otherwise), the Company could be required to seek
additional financing sooner than currently anticipated. In addition, the Company
will be required to obtain  additional funds in any event through equity or debt
financing,  strategic  alliances with corporate  partners and others, or through
other  sources in order to bring its  products  through  regulatory  approval to
commercialization.  The terms and prices of any equity or debt financings may be
significantly  more favorable than those of the units sold in the offering.  The
Company does not have any material  committed  sources of additional  financing,
and there can be no assurance that  additional  funding,  if necessary,  will be
available on acceptable  terms,  if at all. If adequate funds are not available,
the Company may be required to delay,  scale-back,  or eliminate certain aspects
of  its  operations  or  attempt  to  obtain  funds  through  arrangements  with
collaborative  partners or others  that may  require  the Company to  relinquish
rights  to  certain  of  its  technologies,  product  candidates,  products,  or
potential markets. If adequate funds are not available,  the Company's business,
financial condition,  and results of operations will be materially and adversely
affected.



Product Research and Development Plan

         The Company's plan of operation for 1998 consists primarily of research
and development and related activities including:

     C   further  development of the Company's  IPSC research  programs aimed at
         proprietary  populations of functioning islets for transplantation into
         diabetic patients;

     C   continuing  the funding of the ongoing  discovery  program in which the
         Company  intends to identify  and  characterize  novel  growth  factors
         associated with the IPSCs, to discover factors  important in islet cell
         differentiation  and  possible  regulation  of diabetes and to identify
         stem cell  markers to which the  Company  hopes to  produce  antibodies
         useful in stem cell isolation;

     C   further  preclinical  development  of a  quantitative  version  of  the
         Company's molecular diagnostic, the XEntrIx (TM) Oxalobacter formigenes
         Monitor,

     C   further  development  of  IxC1-62/47,  including  formulation,  product
         characterization,  method development,  testing (including toxicology),
         cell  line   characterization,   process   development,   clinical  lot
         manufacturing,  stability,  research protocols, and preclinical studies
         for the Company's  proposed  products,  primarily  its  oxalate-related
         products;

     C   continuing the prosecution and filing of patent applications; and

          hiring additional employees.

         The actual  research  and  development  and related  activities  of the
Company may vary significantly from current plans depending on numerous factors,
including  changes in the costs of such activities from current  estimates,  the
results of the  Company's  research  and  development  programs,  the results of
clinical studies, the timing of regulatory submissions,  technological advances,
determinations  as  to  commercial  potential  and  the  status  of  competitive
products.  The focus and  direction  of the  Company's  operations  will also be
dependent  upon the  establishment  of  collaborative  arrangements  with  other
companies, and other factors.

         There  can  be  no   assurance   that  the  Company  will  be  able  to
commercialize its technologies, or that profitability will ever be achieved. The
Company  expects that its operating  results will fluctuate  significantly  from
quarter to quarter in the future and will depend on a number of factors, many of
which are outside the Company's control.




<PAGE>


Part II - Other Information

Item 6.  Exhibits and Reports on Form 8-K

(a)  Exhibits

Exhibit     Description                                                 Page

   (2)      Plan of Acquisition, Reorganization, Arrangement,
            Liquidation or Succession                                   None

   (4)      Instruments defining the Rights of Security Holders         None

  (10)      Material Contracts                                          None

  (11)      Statement re: Computation of Per Share Earnings             None

  (15)      Letter re: Unaudited Interim Financial Information          None

  (18)      Letter re: Change in Accounting Principles                  None

  (19)      Report Furnished to Security Holders                        None

  (22)      Published Report re: Matters Submitted to Vote of
            Security Holders                                            None

  (23)      Consents of Experts and Counsel                             None

  (24)      Power of Attorney                                           None

  (27)      Financial Data Schedule

  (99)      Additional Exhibits                                         None

(b) Reports on Form 8-K                                                 None


                                   Signatures

         In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.

                                              Ixion Biotechnology, Inc.


Dated: May 7, 1998                         By: /s/ Weaver H. Gaines
                                               --------------------
                                           Weaver H. Gaines
                                           Chairman and Chief  Executive Officer

Dated: May 7, 1998                         By: /s/ David C. Peck
                                               -----------------
                                           David C. Peck
                                           President and Chief Financial Officer
                                           (Principal Financial Officer

Dated: May 7, 1998                         By: /s/ Kimberly A. Ramsey
                                               ----------------------
                                           Kimberly A. Ramsey
                                           Controller 
                                           (Principal Accounting Officer)