UNITED STATES
                       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 September 30, 2002

[ ]  Transition  period  pursuant  to Section  13 or 15(d) of the  Securities
     Exchange Act of 1934.

         For the transition period from __________ to __________.


                                     0-20727
                            (Commission File Number)

                               NOVOSTE CORPORATION
             (Exact Name of Registrant as Specified in Its Charter)

             FLORIDA                                  59-2787476
             -------                                  ----------
 (State or other jurisdiction of         (I.R.S. Employer Identification No.)
  incorporation or organization)

  3890 STEVE REYNOLDS BLVD.
         NORCROSS, GA                                     30093
         ------------                                     -----
(Address of Principal Executive Offices)                (Zip Code)

                                 (770) 717-0904
                  (Registrant's telephone, including area code)

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
requirements for the past 90 days.

    (Item 1) Yes     X                 No
                ---------------          ----------------
    (Item 2) Yes     X                 No
                -----------------        ----------------

As of October 31, 2002 there were 16,186,373  shares of the Registrant's  Common
Stock outstanding.



<PAGE>



                               NOVOSTE CORPORATION

                                    FORM 10-Q

                                      INDEX

<TABLE>
<CAPTION>
<S>  <C>                                                                                    <C>

PART I.           FINANCIAL INFORMATION                                                     PAGE NO

     Item 1. Consolidated Financial Statements

             Consolidated Balance Sheets as of September 30, 2002 (unaudited)                    3
                 and December 31, 2001

             Consolidated Statements of Operations (unaudited) for the three and nine            4
                 months ended September 30, 2002 and 2001

             Consolidated Statements of Cash Flows (unaudited) for the nine                      5
                 months ended September 30, 2002 and 2001

             Notes to Unaudited Consolidated Financial Statements                             6-10

     Item 2. Management's Discussion and Analysis of Financial                               11-19
                 Condition and Results of Operations

     Item 3. Quantitative and Qualitative Disclosures About Market Risk                         20

     Item 4. Controls and Procedures                                                            20

PART II.        OTHER INFORMATION

     Item 1. Legal Proceedings                                                                  21

     Item 2. Changes in Securities and Use of Proceeds                                          21

     Item 3  Defaults Upon Senior Securities                                                    21

     Item 4. Submission of Matters to a Vote of Security Holders                                21

     Item 5. Other Information                                                                  21

     Item 6. Exhibits and Reports on Form 8-K                                                   22

SIGNATURES                                                                                      23

CERTIFICATIONS                                                                               24-25

</TABLE>



                                       2
<PAGE>

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

<TABLE>
<CAPTION>
<S>                                                             <C>                  <C>

                               NOVOSTE CORPORATION
                           CONSOLIDATED BALANCE SHEETS
                                                                 September 30, 2002   December 31, 2001
                                                                 -------------------  -----------------
                                                                     (Unaudited)
ASSETS
Current assets:
     Cash and cash equivalents                                    $    18,119,111     $     5,878,286
     Short-term investments                                            15,251,150          31,683,627
     Accounts receivable, net of allowance of
          $1,108,892 and $878,424 respectively                          9,205,583          16,130,721
     Inventory, net                                                     3,857,748           3,746,433
     Prepaid expenses and other current assets                            881,217           1,023,137
                                                                  ----------------    ----------------
    Total current assets                                               47,314,809          58,462,204
                                                                  ----------------    ----------------

Property and equipment, net                                            10,190,613           9,886,711
Radiation and transfer devices, net                                    11,706,885          13,534,356
Receivable from officers                                                  279,829             144,025
Other assets                                                            1,048,818             883,311
                                                                  ----------------    ----------------
Total assets                                                      $    70,540,954     $    82,910,607
                                                                  ================    ================

LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
     Accounts payable                                             $     2,596,320     $     4,026,866
     Accrued expenses                                                   9,186,296          10,917,277
     Unearned revenue                                                   1,571,624           2,786,476
     Capital lease obligations                                             69,986             249,212
                                                                  ----------------    ----------------
     Total current liabilities                                         13,424,226          17,979,831
                                                                  ----------------    ----------------

Long-term liabilities
     Capital lease obligations                                            182,852             203,135
                                                                  ----------------    ----------------

Shareholders' equity:
     Preferred stock, $.01 par value, 5,000,000 shares
          authorized; no shares issued and outstanding                          -                   -
     Common stock, $.01 par value, 25,000,000 shares
          authorized; 16,351,953 and 16,265,081 shares issued,            163,520             162,651
     Additional paid-in capital                                       187,478,589         187,357,044
     Accumulated other comprehensive income (loss)                         51,464            (408,139)
     Accumulated deficit                                             (129,819,404)       (121,383,528)
                                                                  ----------------    ----------------
                                                                       57,874,169          65,728,028
     Less treasury stock, 165,580 and 5,780 shares of
          common stock at cost                                           (639,870)            (23,840)
     Unrealized loss on Held-for-Sale Securities                           (6,000)                  -
     Unearned compensation                                               (294,423)           (976,547)
                                                                  ----------------    ----------------
     Total shareholders' equity                                        56,933,876          64,727,641
                                                                  ----------------    ----------------
     TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY                   $    70,540,954     $    82,910,607
                                                                  ================    ================

</TABLE>

                             See accompanying notes.



                                       3
<PAGE>


<TABLE>
<CAPTION>
<S>                                             <C>                <C>                 <C>                   <C>
                               NOVOSTE CORPORATION
                 UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS

                                                         Three Months Ended                      Nine Months Ended
                                                           September 30,                           September 30,
                                                -------------------------------------  ---------------------------------------
                                                      2002               2001                 2002                2001
                                                -----------------  ------------------  -------------------  ------------------

Net sales                                           $ 14,655,449        $ 20,916,639         $ 54,412,101        $ 47,497,974
Cost of sales                                          6,774,235           5,118,949           19,666,656          14,589,293
Impairment charge                                              -                   -            6,900,000                   -
                                                -----------------  ------------------  -------------------  ------------------
Gross margin                                           7,881,214          15,797,690           27,845,445          32,908,681

Operating expenses:
     Research and development                          3,501,473           2,941,372            9,624,645          10,261,939
     Sales and marketing                               5,850,804           8,990,636           20,613,762          25,425,965
     General administrative                            1,909,597           2,252,761            6,508,289           6,739,757
                                                -----------------  ------------------  -------------------  ------------------
Total operating expenses                              11,261,874          14,184,769           36,746,696          42,427,661
                                                -----------------  ------------------  -------------------  ------------------

Income (loss) from operations                         (3,380,660)          1,612,921           (8,901,251)         (9,518,980)

Interest income, interest expense
   and other, net                                         93,786             473,320              515,376           1,680,046
                                                -----------------  ------------------  -------------------  ------------------
Income (loss) before income taxes                     (3,286,874)          2,086,241           (8,385,877)         (7,838,934)
     Income taxes                                              -                   -              (50,000)                  -
                                                -----------------  ------------------  -------------------  ------------------

Net income (loss)                                   $ (3,286,874)       $  2,086,241         $ (8,435,877)       $ (7,838,934)
                                                =================  ==================  ===================  ==================

Net income (loss) per share - Basic                 $      (0.20)       $       0.13         $      (0.52)         $    (0.49)
                                                =================  ==================  ===================  ==================

Weighted average shares outstanding
     Basic                                            16,286,445          16,188,275           16,292,708          16,132,954

Net income (loss) per share - Diluted               $      (0.20)        $      0.13         $     ( 0.52)         $    (0.49)
                                                =================  ==================  ===================  ==================

Weighted average shares outstanding
   Diluted                                            16,286,445          16,418,391           16,292,708          16,132,954

                             See accompanying notes.
</TABLE>



                                       4
<PAGE>
                               NOVOSTE CORPORATION
                 UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
<S>                                                                      <C>              <C>
                                                                             For The Nine Months Ended
                                                                                   September 30,
                                                                                2002            2001
                                                                         ----------------  ----------------
Cash flows from operating activities:
Net loss                                                                     $(8,435,877)     $ (7,383,934)

Adjustments to reconcile net loss to net cash
     used by operating activities:
          Depreciation and amortization                                        1,860,043         1,770,425
          Issuance (cancellation) of stock for service or compensation           196,875           155,246
          Amortization of deferred compensation                                  139,268           826,222
          Amortization of radiation & transfer devices                         4,993,786         3,077,099
          Provision for doubtful accounts                                        230,468           587,920
          Non-cash impairment Charge                                           5,065,000                 -
          Changes in assets and liabilities:
               Accounts receivable                                             6,694,670       (10,041,542)
               Inventory                                                        (111,315)       (1,430,962)
               Prepaid expenses                                                  141,920          (617,386)
               Accounts payable                                               (1,430,546)         (448,460)
               Accrued expenses and taxes withheld                            (1,730,982)        2,812,628
               Unearned revenue                                               (1,214,852)        2,960,842
               Other                                                             307,311          (793,328)
                                                                         ----------------  ----------------
Net cash generated  (used) by operations                                       6,091,149        (8,980,230)
                                                                         ----------------  ----------------

Cash flow from investing activities:
     Maturity (purchase) of short-term investments                            16,432,477         8,521,294
     Purchase of property and equipment, net                                  (2,163,945)       (3,339,284)
     Purchase of radiation and transfer devices                               (8,231,315)       (9,696,590)
                                                                         ----------------  ----------------

Net cash provided by (used by) investing activities                            6,037,217        (4,514,580)
                                                                         ----------------  ----------------
Cash flows from financing activities:
     Proceeds from issuance of common stock                                      468,397         1,517,267
     Purchase of Treasury Stock                                                 (616,030)
     Repayment of capital lease obligations                                     (199,509)         (177,103)
                                                                         ----------------  ----------------
Net cash provided  (used) by financing activities                               (347,142)        1,340,164
                                                                         ----------------  ----------------
Effect of exchange rate changes on cash                                          459,602            19,507
Net  increase (decrease) in cash and cash equivalents                         12,240,825       (12,135,139)
Cash and equivalents at beginning of period                                    5,878,286        26,512,398
                                                                         ----------------  ----------------
Cash and cash equivalents at end of period                                   $18,119,111      $ 14,377,259
                                                                         ================  ================

SUPPLEMENTAL DISCLOSURE OF CASH FLOW
     Information:
          Cash paid for interest                                                 (97,331)          (45,027)
     Non-cash investing and financing activities:
          Assets acquired under capital lease                                                      105,000


                             See accompanying notes.


</TABLE>


                                       5
<PAGE>



                               NOVOSTE CORPORATION
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
                               September 30, 2002


NOTE 1.  BASIS OF PRESENTATION

The accompanying  unaudited consolidated financial statements have been prepared
in  accordance  with  generally  accepted  accounting   principles  for  interim
financial  information  and in  accordance  with  instructions  to Article 10 of
Regulation  S-X.  Accordingly,  such  consolidated  financial  statements do not
include all of the information and  disclosures  required by generally  accepted
accounting  principles  for  complete  financial  statements.  In the opinion of
management, all normal and recurring adjustments considered necessary for a fair
presentation have been included.

The  operating  results of the interim  periods  presented  are not  necessarily
indicative of the results to be achieved for the year ending  December 31, 2002.
The accompanying consolidated financial statements should be read in conjunction
with the  audited  financial  statements  and notes  thereto  for the year ended
December  31, 2001  included in the  Company's  2001 Annual  Report on Form 10-K
filed with the Securities and Exchange Commission ("SEC").

The  consolidated   financial   statements   include  the  accounts  of  Novoste
Corporation and its wholly-owned subsidiaries incorporated in August 1998 in the
Netherlands,  in December  1998 in  Belgium,  in  February  1999 in Germany,  in
January 2000 in France and a dedicated  sales  corporation  incorporated  in the
state of Florida  in July,  2002.  Significant  inter-company  transactions  and
accounts have been eliminated.

On  August  19,  2002,  the  Company   initiated  a  voluntary   recall  of  the
Beta-Rail(TM)  3.5F Delivery Catheter  inventory from its customers.  The recall
related  to the  discovery  by the  Company  of a small  number of  catheter-tip
separations in the 3.5F product. An extensive evaluation and improvement program
was initiated.  A pre-market  approval  supplement was submitted to the Food and
Drug  Administration  ("FDA") on October 15, 2002,  defining the improvements to
the product and manufacturing processes and requesting approval for re-launch of
the  product.  The FDA has one hundred  and eighty  (180) days to act on the PMA
supplement with an approval or a denial to re-launch the product.  Additionally,
the FDA may require  additional  information from the Company prior to acting on
the application.

The impact of the 3.5F  catheter  recall has been  included in the  consolidated
financial statements of the Company and is recorded in the corresponding revenue
and expense  categories as  appropriate  based upon the nature of the expense or
adjustment.  Net sales were  adjusted  by  approximately  $3.0  million for 3.5F
catheters  that were sold to  customers  but  subsequently  returned  due to the
recall.  Cost of sales  reflects  approximately  $800,000  for the  disposal  of
existing 3.5F catheters in inventory and for the  additional  labor and costs in
shipping 5.0F  transfer  devices,  radiation  source trains and catheters to our
customers.  Operating  expenses reflect the labor and material costs involved in
testing the 3.5F catheters in order to determine the proper  corrective  actions
to be included in our reports to the FDA.

In the opinion of management,  all adjustments  (consisting of normal  recurring
accruals  and  estimated  write-downs  and accruals  resulting  from the recall)
considered  necessary for a fair presentation of Novoste's financial results and
condition have been recorded.

NOTE 2.  CASH EQUIVALENTS AND SHORT-TERM INVESTMENTS

Cash  equivalents  are  comprised  of certain  highly  liquid  investments  with
maturities  of less  than  three  months  at the time of their  acquisition.  In
addition to cash  equivalents,  the Company has investments in commercial  paper
and other  securities that are classified as short-term.  Management  determines
the appropriate classification of debt securities at the time of purchase.

All securities are considered as available-for-sale  and reported at fair value,
with the  unrealized  gains and  losses  reported  in a  separate  component  of
shareholders'  equity, if significant.  The amortized cost of debt securities in
this category, if significant, is adjusted for amortization included in interest
income.   Realized  gains  and  losses  and  declines  in  value  judged  to  be
other-than-temporary  on available-for-sale  securities are included in interest
income.  The cost of  securities  sold is based on the  specific  identification
method.  Interest and dividends on securities  classified as  available-for-sale
are  included  in  investment   income.   At  September  30,  2002,  fair  value
approximated  net  book  value  for all  short-term  investments  and  all  were
considered available-for-sale and have been accounted for as such.

NOTE 3.  ACCOUNTS RECEIVABLE

Accounts  receivable  at  September  30,  2002 and  December  31,  2001  include
receivables  due from  product  sales and amounts  due under lease  arrangements
relating to radiation and transfer  devices (see Note 5.  Radiation and Transfer
Devices).  The carrying amounts reported in the consolidated  balance sheets for
accounts receivable  approximate their fair value. The Company performs periodic
credit evaluations of its customers'  financial condition and generally does not
require  collateral.  Management records estimates of expected credit losses and
returns of product sold.



                                       6
<PAGE>

During the quarter  Novoste  recalled all 3.5F diameter  catheters (see Note 1).
The  returned  catheters  generated  credits  of  approximately  $3  million  to
customers who could use the value of the credits in a variety of ways, including
the purchase of replacement 5F catheters,  the clearing of existing obligations,
the  application  of the value against future  purchases,  or the customer could
request a cash refund.

Accounts  receivable  at  September  30, 2002 have been  adjusted to reflect all
credits associated with the recall on customers with invoices  outstanding.  The
remaining  credits  for  customers  with  no  invoices   outstanding  have  been
classified as accrued liabilities.

Bad debt expense for the  three-month  periods ended September 30, 2002 and 2001
amounted to $165,572 and $290,000,  respectively, and for the nine-month periods
ended September 30, 2002 and 2001 were $329,680 and $590,000.

NOTE 4.  INVENTORIES

Inventories  are  stated  at the lower of cost or  market  value on a  first-in,
first-out (FIFO) basis and are comprised of the following:

                                 September 30, 2002         December 31, 2001
                                 ------------------         -----------------

      Raw Materials               $    3,091,199               $  1,971,347
      Work in Process                    265,715                    811,406
      Finished Goods                     508,834                    963,680
                                 ------------------         -----------------
      Total                       $    3,857,748               $  3,746,433
                                 ==================         =================


NOTE 5.  RADIATION AND TRANSFER DEVICES

The Company retains ownership of the radiation source trains (RSTs) and transfer
devices  (TDs).  Depreciation  of the costs of these  assets  is taken  over the
estimated useful life using the straight-line  method and is recorded in Cost of
Sales.  Depreciation  begins at the time the  Beta-Cath TM System is placed into
service.  The annual agreements with the Company's  customers to license the use
of radiation  and transfer  devices are  classified  by the Company as operating
leases.  Income is recognized ratably over the length of the lease. At September
30, 2002, deferred revenue under these leases approximated $0.8 million.

During  2001,  the Company  estimated  the useful lives of these assets to be 18
months based upon the information  available at that time.  During January 2002,
the  Company  determined  that,  based  upon new  testing  and  experience,  the
estimated  useful  lives of RSTs are twelve  months and the TDs are three years.
Accordingly,  depreciation  has  been  recorded  over  the new  estimated  lives
starting  at the  beginning  of the  first  quarter  2002.  The  Company  begins
depreciation  when the Beta-CathTM  System is placed into service.  At September
30,  2002,  equipment  with a cost of  approximately  $27.4  million,  less $5.1
million reserve for impairment (See Note 11) before accumulated  depreciation of
approximately $10.7 million, was subject to operating leases. Approximately $3.3
million of radiation and transfer  devices were available for lease at September
30, 2002. Radiation and transfer devices stated at cost, less impairment charge,
are comprised of the following:


                                         September 30, 2002   December 31, 2001
                                         ------------------   -----------------

    Radiation and Transfer Devices       $    22,393,212      $    18,753,747
    Less:  Accumulated Depreciation          (10,686,329)          (5,219,391)
                                         ------------------   -----------------
                                         $    11,706,883           13,534,356
                                         ==================   =================


                                       7
<PAGE>

NOTE 6.  RECEIVABLE FROM OFFICERS

In October 2001, the Company adopted a split-dollar  life insurance plan for all
officers.  The  Company  matches  officer  contributions  to the  plan  and also
provides  an advance  for  related  payroll  taxes.  The  payroll tax advance is
reflected as a receivable  from officers on the balance sheet.  The advances are
unsecured and are subject to the life insurance  company's  ability to repay the
Company  in  the  future  from  the  available  funds.  There  were  no  related
compensation  expenses or payroll  advances  for the  three-month  period  ended
September 30, 2002. In accordance with the plan agreement,  if an officer leaves
the Company for any reason,  retires or in any way  terminates or withdraws from
the plan, the life  insurance  company is obligated to repay the Company for the
tax advances  prior to settlement of the account with the officer.  At September
30, 2002,  and  December 31, 2001,  the  receivable  from  officers  balance was
$279,829 and $144,025,  respectively. One officer left the Company, reducing the
receivable by $34,668 during the quarter.

The  Company  is  re-evaluating   the  split  dollar  insurance   program.   The
Sarbanes-Oxley Act of 2002 ("the Act") passed by Congress and signed into law in
July 2002, may limit or effectively prevent  implementation of programs like the
Company's  split dollar plan and we are currently  evaluating the effect the Act
has on this program.  The Company has ceased accepting further  contributions to
the plan from Executive Officers until the analysis is concluded.

NOTE 7.  LINE OF CREDIT

In August 2001,  the Company  obtained a $10 million  revolving  line of credit.
During the nine months ended September 30, 2002 the Company had borrowed as much
as $4 million  against the line of credit;  however,  at September  30, 2002 and
December 31, 2001,  the Company had no outstanding  borrowings.  The Company may
borrow an  amount  not to  exceed  the  borrowing  base as  defined  in the loan
agreement which is principally based on domestic accounts receivables.  Interest
on outstanding balances is payable on the first of each month, calculated on the
outstanding balance, and accrues at a rate of the bank's prime rate plus 1%. The
Company granted a first priority  security  interest in substantially all assets
of the Company to the lender.  The  Company was not in  violation  of any of its
loan  covenants at September 30, 2002. By agreement  between the Company and the
lender,  dated August 31, 2002, the maturity date of the original Loan Agreement
between the parties was extended to November 30, 2002. It is anticipated  that a
new revolving line of credit  agreement,  under similar terms, will be completed
and executed prior to the expiration of the extended maturity date.

The Company also has letters of credit  available  under the  revolving  line of
credit.  The lender will issue or has issued letters of credit for the Company's
account  subject to certain  limitations;  however,  all such issued  letters of
credit may not exceed $500,000 in the aggregate.

NOTE 8.  SEGMENT INFORMATION

SFAS  No.  131,   Disclosures  about  Segments  of  an  Enterprise  and  Related
Information ("SFAS 131") requires the reporting of segment  information based on
the information  provided to the Company's  chief  operating  decision maker for
purposes  of  making   decisions  about   allocating   resources  and  accessing
performance.  The Company's  business  activities  are  represented  by a single
industry  segment,  the manufacture and  distribution  of medical  devices.  For
management purposes, the Company is segmented into three geographic areas:
North America, Europe and the Rest of World (Canada, Asia and South America)




                                       8
<PAGE>

The Company's net sales,  net loss and long-lived  assets by geographic  area at
and for the nine months ended September 30 for 2002 and 2001 are as follows:

<TABLE>
<CAPTION>
<S>          <C>    <C>                <C>           <C>               <C>
Net sales
                    United States      Europe        Rest of World     Consolidated
                    -------------      ------        -------------     ------------
             2002     $50,833,347      $3,154,185         $424,569      $54,412,101
             2001     $43,466,425      $3,527,056         $504,493      $47,497,974


Net loss
                     United States      Europe        Rest of World     Consolidated
                     -------------      ------        -------------     ------------
             2002     $(5,668,243)    $(2,136,145)       $(631,499)     $(8,435,877)
             2001     $(2,529,493)    $(4,844,912)       $(464,529)     $(7,838,934)


Long-lived assets
                    United States      Europe        Rest of World     Consolidated
                    -------------      ------        -------------     ------------
             2002     $19,389,246      $2,363,735         $144,519      $21,897,500
             2001     $20,039,478      $3,268,178         $113,411      $23,421,067

</TABLE>

At September 30, 2002 and September 30, 2001,  the Company's net assets  outside
of the  United  States,  consisting  principally  of cash and cash  equivalents,
accounts  receivable,  transfer  radiation  devices and office  equipment,  were
approximately $4.9 million and $6.5 million, respectively.

NOTE 9.  EARNINGS (LOSS) PER SHARE

The basic and diluted income or loss per share is computed based on the weighted
average number of common shares  outstanding.  Common  equivalent shares are not
included in the per share calculations where the effect of their inclusion would
be anti-dilutive.

The following  table sets forth the  computation  of basic and diluted  earnings
(loss) per share for the three and nine month periods  ended  September 30, 2002
and 2001:

<TABLE>
<CAPTION>
<S>                                                     <C>            <C>            <C>             <C>

                                                             Three Months Ended             Nine Months Ended
                                                               September 30,                  September 30,
                                                        ----------------------------- ------------------------------
                                                            2002           2001            2002           2001
                                                        -------------- -------------- --------------- --------------
Numerator:
     Net income (loss)                                   $(3,286,874)     $2,086,241    $(8,435,877)   $(7,838,934)

Denominator:
     Weighted-average shares outstanding                   16,286,445     16,188,275      16,292,708     16,132,954
     Dilutive effect of stock options and
       unvested restricted stock                                    -        230,116               -              -
                                                        -------------- -------------- --------------- --------------
       Denominator for diluted earnings per share          16,286,445     16,418,391      16,292,708     16,132,954
Net income (loss) per share:
     Basic                                                    $(0.20)          $0.13         $(0.52)        $(0.49)
     Diluted                                                  $(0.20)          $0.13         $(0.52)        $(0.49)

</TABLE>



                                       9
<PAGE>



NOTE 10.  SHAREHOLDERS' EQUITY

For the three and nine  month  periods  ended  September  30,  2002  changes  in
shareholders' equity consisted of the following:
<TABLE>
<CAPTION>
      <S>                                                             <C>                  <C>

                                                                        Three Months         Nine Months
                                                                      ------------------   -----------------
      Shareholders' equity at beginning of period                          $ 61,013,795        $ 64,727,641
      Proceeds from exercise of 56,375 stock options ranging from
           $1.00 to $6.65 per share                                                   -             364,369
      Proceeds from issuance of stock under employee stock purchase
           plan, 24,497shares on 6/28/02 at $4.08 per share                           -             104,028
      Stock re-purchase of 159,800 shares                                      (616,030)           (616,030)
      Deferred compensation relating to accelerated vesting of
           certain stock options                                                      -             196,875
      Amortization of unearned compensation                                      42,587             682,124
      Cancellation of unvested compensation charge options                            -            (542,856)
      Unrealized loss on held-for-sale securities                                (6,000)             (6,000)
      Comprehensive loss:
           Translation adjustment                                              (213,602)            459,602
           Net income (loss)                                                 (3,286,874)         (8,435,877)
                                                                      ------------------   -----------------
      Total comprehensive loss                                               (3,500,476)         (7,976,273)
                                                                      ------------------   -----------------

      Shareholders' equity at September 30, 2002                           $ 56,933,876        $ 56,933,876
                                                                      ==================   =================
</TABLE>


NOTE 11.  IMPAIRMENT CHARGES

The company  accounts for  long-lived  assets in accordance  with the provisions
SFAS No. 144,  "Accounting for the Impairment or Disposal of Long-Lived Assets."
SFAS No. 144 requires long-lived assets and certain identifiable  intangibles to
be reviewed for impairment whenever events or changes in circumstances  indicate
the carrying amount of an asset may not be recoverable. Recoverability of assets
to be held and used is measured by a  comparison  of the  carrying  amount of an
asset to future  undiscounted  net cash flows  expected to be  generated  by the
asset.  If assets are impaired,  the  impairment to be recognized is measured by
the amount by which the carrying  amount of the assets exceeds the fair value of
the assets.  Assets to be disposed of are  reported at the lower of the carrying
amount or fair value, less costs to sell.

In March  2002,  Novoste  began  commercial  distribution  of a  newer,  smaller
Beta-CathTM System equipped with a 3.5F diameter  catheter.  Original plans were
to introduce the product  slowly;  however,  the smaller  diameter system allows
physicians to provide better and more comprehensive treatment to their patients,
and demand for the new product exceeded  expectations,  with the first-year goal
of installed  sites being  achieved in less than four  months.  While the older,
larger 5.0F  diameter  Beth CathTM  Systems  are still  serviceable,  during the
second quarter of 2002, Novoste decided to concentrate marketing and development
efforts  on the 3.5F  diameter  Beta-CathTM  System.  Accordingly,  the  Company
evaluated  the ongoing  value of the 5.0F  systems that are equipped to use with
30mm and 40mm radiation  source trains.  Based on this  evaluation,  the Company
determined  that the transfer  devices and radiation  source  trains,  which are
long-lived  assets,  with a  carrying  amount  of $8.6  million,  were no longer
recoverable  and wrote them down to their  estimated fair value of $3.5 million,
and accrued $1.8 million for related expenses, resulting in an impairment charge
of $6.9 million for the second quarter.  Fair value was based on expected future
net cash flows to be  generated  by the transfer  devices and  radiation  source
trains during their remaining service lives, discounted at the risk-free rate of
interest.  The  remaining  fair value is amortized  ratably  over the  estimated
useful life of these assets. On August 19, 2002, Novoste announced the recall of
all 3.5F diameter catheter  products (Note 1). As a result,  demand for the 5.0F
diameter system increased significantly to service the patients needing vascular
brachytherapy.  This increased  demand should provide cash flow in excess of the
carrying  value.  Thus no  additional  impairment  charge was  recorded  in this
quarter ended September 30, 2002.




                                       10
<PAGE>



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

FORWARD LOOKING INFORMATION

The  statements  contained  in  this  Form  10-Q  that  are not  historical  are
forward-looking  statements  within the meaning of Section 27A of the Securities
Act of 1933 and Section 21E of the  Securities  Exchange Act of 1934,  including
statements regarding expectations,  beliefs,  intentions or strategies regarding
the future. The Company intends that all  forward-looking  statements be subject
to the safe-harbor provisions of the Private Securities Litigation Reform Act of
1995.  These  forward-looking  statements  reflect the Company's views as of the
date they are made with respect to future events and financial performance,  but
are subject to many uncertainties and risks which could cause the actual results
of the Company to differ materially from any future results expressed or implied
by such forward-looking  statements.  Some of these risks are discussed below in
the sections  "Liquidity and Capital  Resources"  and "Certain  Factors That May
Impact Future  Operations and Liquidity."  Additional risk factors are discussed
in other reports filed by the Company from time to time on Forms 10-K,  10-Q and
8-K,  including  the  Company's  annual  report on Form 10-K for the year  ended
December 31, 2001.  The Company does not undertake any  obligations to update or
revise any forward-looking statements, made by it or on its behalf, whether as a
result of new information, future events, or otherwise.

CRITICAL ACCOUNTING POLICIES

The Company's  discussion and analysis of its financial condition and results of
operations are based upon the Company's consolidated financial statements, which
have been prepared in accordance with accounting  principles  generally accepted
in the United States. The preparation of our financial  statements requires that
we adopt and follow certain  accounting  policies.  Certain amounts presented in
the  financial   statements  have  been  determined  based  upon  estimates  and
assumptions.  Although  we  believe  that  our  estimates  and  assumptions  are
reasonable, actual results will differ and could be material.

We have included below a discussion of the critical  accounting policies that we
believe are affected by our more significant judgments and estimates used in the
preparation of our financial  statements,  how we apply such  policies,  and how
results  differing from our estimates and  assumptions  would affect the amounts
presented in our financial  statements.  Other  accounting  policies also have a
significant effect on our financial statements,  and some of these policies also
require  the  use of  estimates  and  assumptions.  Note  1 to the  Consolidated
Financial Statements discusses our significant accounting policies.

Revenue Recognition

Revenue  from the sale of  products  is  recorded  when an  arrangement  exists,
delivery has occurred and services  have been  rendered,  the seller's  price is
fixed and determinable and  collectability  is reasonably  assured.  The Company
earns revenue from sales of catheters  and from license and lease  agreements to
use  the  radiation   source  trains  and  transfer   devices  included  in  the
Beta-Cath(TM) System.

Novoste uses  distributors in countries where the  distributors'  experience and
knowledge of local radiation and medical device  regulatory issues is considered
beneficial  by the Company's  management.  Under the  distributor  arrangements,
there are generally no purchase  commitments and no provisions for  cancellation
of purchases.  Novoste or the distributor may cancel the distributor  agreements
at any time.

Revenue  from sales of  catheters  directly  to  hospitals  is  recognized  upon
shipment after the hospital has leased a Beta-Cath(TM)  System and completed all
licensing  and other  requirements  to use the system.  The  Company  recognizes
revenue from sales of catheters to distributors at the time of shipment.

The Company  retains  ownership  of the  radiation  source  trains and  transfer
devices and enters into either a lease or license  agreement with its customers.
Revenue  recognition begins once an agreement has been executed,  the system has
been shipped,  and all licensing and other  requirements  to use the system have
been  completed.  The  revenue  is  recognized  ratably  over  the  term  of the
agreement. The terms of the operating lease signed with customers located in the
United States requires, as dictated by FDA regulatory approval,  replacement and
servicing  of the  radiation  source  train and  transfer  device  at  six-month
intervals or number of usages. No other post-sale obligations exist.



                                       11
<PAGE>

The  Company  sells its  catheters  with no right of  return  except in cases of
product  malfunction  or shipping  errors.  A reserve has been recorded  against
revenue for known returns and an estimate of unknown returns. In connection with
the  introduction  of the 3.5F catheter system in the second quarter of 2002 the
Company  exchanged some 5F catheters for 3.5F  catheters for its customers.  The
exchange of these  catheters  was  expected to continue in the future  until the
3.5F system had been fully launched to all customer sites. At June 30, 2002, the
Company had recorded a reserve for approximately  $1,000,000 to recognize the 5F
catheters  purchased prior to June 30, 2002 that were expected to be returned in
the future in exchange for 3.5F  catheters.  At September 30, 2002, a reserve of
$750,000 is recorded to reflect  management's  estimate of 5.0F  catheters  sold
prior to September 30, 2002 that are expected to be returned for 3.5F  catheters
upon FDA approval and re-launch of the 3.5F product.

Radiation and Transfer Devices and Amortization of Costs

The Company retains ownership of the radiation source trains (RSTs) and transfer
devices  (TDs)  that are  manufactured  by third  party  vendors.  The  costs to
acquire,  test and assemble  these assets are recorded as incurred.  The Company
has determined that based upon experience,  testing and discussions with the FDA
the estimated useful life of RSTs and TDs exceeds one year and is potentially as
long  as four  years.  Accordingly,  the  Company  classifies  these  assets  as
long-term assets.  Depreciation of the costs of these assets is included in Cost
Of  Sales  and is  recognized  over  their  estimated  useful  lives  using  the
straight-line method. Depreciation begins at the time the Beta- CathTM System is
placed  into  service.  Valuation  reserves  are  recorded  for the  balance  of
unamortized costs of TDs and RSTs that are not available for use by a customer.

The Company has invested significant resources to acquire RSTs and TDs that make
up the Beta-CathTM  System and offers multiple  treatment length catheters (each
of which  requires a different TD and RST).  The  acquisition  of these  various
length  systems  are  based  upon  demand   forecasts   derived  from  available
information  provided by the  Company's  Sales and Marketing  organizations.  If
actual  demand  were less  favorable,  or of a  different  mixture of  treatment
lengths than those  projected by  management,  additional  valuation  allowances
might be required which would negatively impact operating profits.

During the second quarter of 2002, Novoste decided to concentrate  marketing and
development efforts on the 3.5 F diameter Beta-CathTM System.  Accordingly,  the
Company evaluated the  recoverability of the carrying value for 5.0F devices and
other assets to determine if an  impairment  charge was  necessary.  The Company
performed  this  evaluation  in accordance  with the  provisions of Statement of
Financial  Accounting  Standards  No.  144,  Accounting  for the  Impairment  or
Disposal of Long-Lived Assets ("FAS 144"). Based on this evaluation, the Company
determined that an impairment charge was warranted (See Note 11).

Stock  Based  Compensation

Novoste  applies the provisions of Statement of Financial  Accounting  Standards
No. 123,  Accounting for Stock-Based  Compensation  ("FAS 123"). As permitted by
FAS 123,  the  Company  accounts  for stock  option  grants in  accordance  with
Accounting  Principles  Board  Opinion No. 25,  Accounting  for Stock  Issued to
Employees ("APB 25") and related interpretations.  Accordingly,  no compensation
expense is  recognized  for stock option grants to employees for which the terms
are fixed.  The Company  grants stock  options  generally  for a fixed number of
shares to employees, directors,  consultants and independent contractors with an
exercise  price  equal to the fair  market  value of the  shares  at the date of
grant.  Compensation  expense is recognized  for increases in the estimated fair
value of common stock for any stock options with variable terms.

The  Company  accounts  for  equity   instruments  issued  to  non-employees  in
accordance with the provisions of SFAS 123 and Emerging Issues Task Force (EITF)
Issue No. 96-18, Accounting for Equity Instruments that Are Issued to Other than
Employees for Acquiring, or in Conjunction with Selling, Goods or Services.

Any  compensation  expense  related to grants  that do not vest  immediately  is
amortized over the vesting  period of the stock options using the  straight-line
method as that methodology most closely approximates the way in which the option
holder earns those options.




                                       12
<PAGE>


Allowance for Doubtful Accounts

We maintain  allowances for doubtful accounts for the estimated losses resulting
from the  inability of our  customers  to make  required  payments.  Most of our
customers are hospitals located in the U.S.,  however,  some are distributors of
our products in foreign  countries or  hospitals  located in Europe.  The amount
recorded in the allowances is based primarily on management's  evaluation of the
financial  condition  of  the  customers.  If  the  financial  condition  of any
customers  deteriorates,  additional allowances may be required.  Allowances are
also maintained for future sales returns and allowances  based on an analysis of
recent trends of product returns.

Inventories

Novoste  values  its  inventories  at the  lower  of cost or  market  value on a
first-in, first-out (FIFO) basis. Provisions are recorded for excess or obsolete
inventory  equal  to  the  cost  of  the  inventory.  Shelf-life  expiration  or
replacement  products in the  marketplace  may cause  product  obsolescence.  If
actual  product  demand and market  conditions  were less  favorable  than those
projected by  management,  additional  provisions  might be required which would
negatively  impact operating  profits.  Novoste  evaluates the adequacy of these
provisions quarterly.

OVERVIEW

Novoste commenced operations as a medical device company in May, 1992. Beginning
in 1994, the Company devoted  substantially all of its efforts to developing the
Beta-CathTM   System.   The  Company  commenced  the  active  marketing  of  the
Beta-CathTM  System  in  Europe  in  January,  1999,  for  use as an  adjunctive
procedure in patients with ischemic heart disease.  On November 3, 2000, Novoste
received U.S. marketing  approval for the 30-millimeter  Beta-CathTM System from
the FDA for use in patients suffering from in-stent  restenosis,  a condition in
which coronary  stents become  clogged with new tissue  growth,  and shipped its
first commercial  system on November 27, 2000. The number of commercial sites in
the U.S.  increased  rapidly  throughout  2001,  and in the first nine months of
2002,  the Company  added  approximately  50 new sites,  bringing the total U.S.
sites  to over  400 at  September  30.  The  Company  now has in  excess  of 500
commercial sites worldwide.

The Company is reporting an operating  loss in the third  quarter 2002 driven by
lower  revenues  and the  expense of  recalling  the 3.5F  catheters  as well as
increased competition for vascular  brachytherapy.  At September 30, 2002 we had
an accumulated deficit of approximately $129.8 million.

RESULTS OF OPERATIONS

Net loss for the three months ended September 30, 2002 was $3,286,874 or $(0.20)
per share,  as compared to a net income of $2,086,241 or $0.13 per share for the
three  months  ended  September  30,  2001.  Net loss for the nine months  ended
September  30,  2002 was  $8,435,877,  or $(0.52) per share as compared to a net
loss of $7,838,934, or $(0.49) per share for the nine months ended September 30,
2001. The net loss for the three months ended September 30, 2002 compared to the
prior year was due primarily to the voluntary recall of the 3.5F catheter in the
quarter.

The impact of the 3.5F  catheter  recall has been  included in the  consolidated
financial statements of the Company and is recorded in the corresponding revenue
and expense  categories as  appropriate  based upon the nature of the expense or
adjustment.  Net sales were  adjusted  by  approximately  $3.0  million for 3.5F
catheters  that were sold to  customers  but  subsequently  returned  due to the
recall.  Cost of sales  reflects  approximately  $800,000  for the  disposal  of
existing 3.5F catheters in inventory and for the  additional  labor and costs in
shipping 5.0F  transfer  devices,  radiation  source trains and catheters to our
customers.  Operating  expenses reflect the labor and material costs involved in
testing the 3.5F catheters in order to determine the proper  corrective  actions
to be included in our reports to the FDA.

Net Sales.  Net sales were  $14,655,449  and  $54,412,101  in the three and nine
months  ended  September  30,  2002,  respectively,  as compared to net sales of
$20,916,639  and  $47,497,974  for the three and nine months ended September 30,
2001,  respectively.  Net sales  recorded in the United States for the three and
nine-month  periods ended  September 30, 2002 were  $14,007,782  and $50,833,347
respectively, as compared to $19,437,626 and $43,466,425,  respectively, for the
same periods ended September 30, 2001.  Comparatively,  international  net sales
decreased 56% to $647,668 for the  three-month  period and 11% to $3,578,754 for
the nine-month period in 2002, compared to $1,479,013 for the three-month period
and $4,031,549 for the nine-month periods ending September 30, 2001.



                                       13
<PAGE>

Net sales declined for the quarter ended September 30, 2002 due primarily to the
recall of the 3.5F catheter.  Approximately  $3.0 million of 3.5F catheters sold
prior to the date of the recall were  credited to customers' accounts.  Catheter
revenue  was  negatively  impacted  by the  reserve  for  future  5.0F  catheter
exchanges,  and lease revenue has declined because the higher lease revenue from
the larger  number of new sites  opened in the first nine months of 2001 has not
been  replaced by lease  revenue from the renewal of those  sites.  Although the
sites  continue to use the  Beta-CathTM  System,  competitive  pressure  has not
allowed the Company to charge continued leasing fees.

Revenues  increased for the nine month period ended  September 30, 2002 over the
same period a year ago due  entirely  to the  increase in the number of domestic
sites utilizing the Beta-CathTM  System at September 30, 2002 as compared to the
same period in 2001.

The Company  anticipates  revenues to be at risk until, and if, the FDA approves
the relaunch of the 3.5F catheter.  The Company's primary  competitor,  Guidant,
distributes  a catheter  size that is smaller  than the 5.0F  catheter  that the
Company is now  dependent  upon for its revenue.  The smaller  catheter can be a
competitive  advantage for Guidant.  If other competitive  advantages enjoyed by
the Company are  compromised by delays in, or failure to, obtain FDA approval to
relaunch  the 3.5F  catheter.  The  Company's  revenue  may  also be  negatively
impacted in 2003 and future years by the introduction of drug eluting stents.

Cost of Sales.  Cost of sales of $6,774,235 and $26,566,655 were incurred in the
three and nine months ended  September 30, 2002,  respectively.  The  nine-month
period  includes  an  impairment  charge of $6.9  million  (See Note 11),  which
negatively  impacted  gross  margins.  Reflecting  cost of sales and  impairment
charges, gross margins for the three and nine month periods ending September 30,
2002 were $7,881214, or 56% and $27,845,445, or 51%, respectively. Excluding the
impairment charge,  gross margins were $7,881,214,  or 56%, for the three months
and  $34,745,445  or, 64%, for the nine months.  Cost of sales for the three and
nine  months  ended  September  30,  2001  were   $5,118,949  and   $14,589,293,
respectively,  and gross margins were 76%, or, $15,797,690,  and $32,908,681 or,
69%, for the same periods respectively in 2001. The decrease in the gross margin
for the third  quarter of 2002 is due to higher  amortization  costs of the 5.0F
devices  as well as  increased  cost of sales  due to the  recall.  The  average
selling price of the Company's  catheters has also declined by  approximately 5%
for the nine months ending  September 30, 2002 due to increased  competition for
vascular  brachytherapy cases. The Company will continue to incur higher cost of
sales until the 5.0F devices are fully amortized and the Company has re-launched
its 3.5F catheter.

Factors  impacting  cost of sales and gross  margins  in  future  quarters  will
include the utilization of catheters at the sites using the  Beta-CathTM  System
and the  costs to  service  the  existing  devices  as well as new 3.5F  devices
planned  to be  installed  once  the  FDA has  approved  re-launching  the  3.5F
catheter.

Research and Development  Expenses.  Research and development expenses increased
19% to $3,501,473  and decreased 6% to $9,624,645  for the three and nine months
ended September 30, 2002, respectively,  from $2,941,372 and $10,261,939 for the
three and six months ended  September 30, 2001.  The decrease for the nine month
period was primarily the result of decreased clinical trial activity as a result
of the completion of pivotal trials for the Beta-CathTM  System used in coronary
applications  in 2001.  However,  in 2002,  the Company  began two new  clinical
trials  to  test  the  safety  and  effectiveness  of  radiation  in  peripheral
applications  which  resulted  in  the  increase  in  research  and  development
expenditures  for the three months  ended  September  30, 2002.  The two trials,
MOBILE (More Beta radiation In the Lower  Extremities) and BRAVO (Beta Radiation
for treatment of Arterial-Venous  graft Outflow),  have begun and the Company is
currently  enrolling clinical trial sites and patients.  The Company anticipates
increasing  research  and  development  expenses in the  remainder of 2002 as it
anticipates increased enrollment in the two new trials and as it pursues product
improvements and line extensions in its current product offerings, some of which
may require additional clinical trials.

Sales and  Marketing  Expenses.  Sales and marketing  expenses  decreased 35% to
$5,850,804  for the three  months and 19% to  $20,613,762  for nine months ended
September 30, 2002, respectively,  from $8,990,636 and $25,425,965 for the three
and nine months ended June 30, 2001.  These expenses  declined  because of lower
product  launch costs  incurred in 2002 than in 2001.  Additional  costs such as
commissions,  travel,  literature,  trade shows,  and samples were incurred last
year to facilitate  introduction of the Beta-CathTM  System in the US market and
the start-up  procedures and training of new sites in 2001. The Company  expects
these  costs to remain  relatively  constant  as a percent  of  revenue  for the
balance of 2002.




                                       14
<PAGE>



General  and  Administrative  Expenses.   General  and  administrative  expenses
decreased  15% to $1,909,597  for the three months ended  September 30, 2002 and
increased 3% to $6,508,289  for the nine months ended  September 30, 2002,  from
$2,252,761  and  $6,739,757  for the three and nine months ended  September  30,
2001.  The decrease for the third quarter 2002 is mainly due to decreased  costs
associated with European operations and the consolidations of offices in Europe.

Other Income and Expenses.  Other income  decreased 80% to $93,786 for the three
months  ended  September  30, 2002 and 69% to $515,376 for the nine months ended
September 30, 2002,  from $473,320 and  $1,680,046 for the three and nine months
ended September 30, 2001. The decrease is mainly due to the dramatic  decline in
interest rates for short-term investments. Interest income is down 110% from the
same  quarter  last year and down 65% year to date.  In  addition,  the  Company
incurred some interest costs  associated with temporary  borrowing from the line
of credit.

LIQUIDITY AND CAPITAL RESOURCES

Operating
During the nine months ended September 30, 2002, the Company generated cash from
operations of $6.1 million and for the nine months ended September 30, 2001 used
$9.0 million of cash in  operations.  The $15.1 million change from cash used by
operations to cash generated by operating activities was primarily  attributable
to decreasing  accounts receivable in 2002 resulting from decreasing revenue, as
opposed to the increase in accounts receivable in 2001 due to the product launch
in the US. Other changes in inventory,  accounts  payable,  accrued expenses and
unearned revenue offset one another and between the periods reflect the increase
in working capital needed in 2001 to fund the  Beta-CathTM  System launch offset
by the decrease in working  capital in the nine months ended  September 30, 2002
as the number of sites, and revenue growth slowed.

Investing
Net cash provided by and used in investing  activities for the nine months ended
September 30, 2002 and 2001 was $6.0 million and $4.5 million, respectively. The
construction  of the plant for  manufacturing  3.5F  radiation  source trains is
complete.  The  decreased  purchase of  radiation  devices in 2002  reflects the
slower rate of opening new sites in 2002,  maturity  of the market  place,  with
fewer transfer  devices  needed.  The Company  anticipates  that the purchase of
radiation  devices  will  continue,  although at a slower  rate,  as the Company
converts accounts to the 3.5F System after it is re-launched.

Financing
The Company's financing activities include equity offerings,  borrowings under a
revolving  credit  facility and  borrowings  and  repayments of capital  leases.
Proceeds  from the  issuance of stock were  received  from the exercise of stock
options and the  acquisition  of stock by the Employee  Stock Purchase Plan. The
Company  purchased  159,800  shares of its common  stock at an average  price of
$3.855 under an authorized  share  repurchase  program.  The Company may decide,
based  upon  market  conditions  and  price of its  common  stock,  to  purchase
additional shares. The total authorized  repurchase was for up to $5 million, of
which the remaining authorized repurchase is $4,384,00. Financing activities for
the nine months  ended  September  30, 2002 and 2001  provided  net cash of $0.3
million and $1.3 million, respectively, mainly through issuance of stock.

In August  2001,  the Company  entered  into a $10 million  accounts  receivable
revolving line of credit with a financial  institution  (lender) that matured in
August 2002. By agreement between the Company and the financial institution, the
maturity date of the original Loan Agreement between the parties was extended to
November  30,  2002.  At  September  30,  2002,  the Company had no  outstanding
borrowings.  The  Company  may borrow an amount  ("advances")  not to exceed the
borrowing  base as  defined  in the loan  agreement,  which was $8.2  million at
September 30, 2002. Interest is payable on the first of each month calculated on
the outstanding  balance and accrues at the rate of the lender's prime rate plus
1% (5.75% at September 30, 2002).  At such time that the Company  achieves three
consecutive  months of profitability,  the rate decreases to the prime rate. The
Company granted a first priority  security  interest in substantially all of its
assets to secure the line of credit.  Additionally,  the loan agreement contains
certain financial and non-financial  covenants. The Company was not in violation
of any of its loan covenants at September 30, 2002. It is anticipated that a new
revolving  line of credit  agreement  with the existing  lender,  under  similar
terms, will be completed and executed during the fourth quarter 2002.

In addition,  the Company also has letters of credit available under the line of
credit. The lender will issue or have issued letters of credit for the Company's
account not  exceeding  (i) the lesser of the  committed  revolving  line or the


                                       15
<PAGE>

borrowing base minus (ii) the outstanding  principal balance of the Advances and
minus  (iii)  the Cash  Management  Sublimit  as  defined  below;  however,  the
aggregate face amount of all outstanding letters of credit (including drawn, but
unreimbursed  letters of credit) may not exceed $500,000.  Each letter of credit
will have an  expiration  date of no later  than 180 days  after  the  revolving
maturity date,  but the Company's  reimbursement  obligation  will be secured by
cash,  on terms  acceptable  to the  lender,  at any time  after  the  revolving
maturity  date, if the term of the Agreement is not extended by the Lender.  The
Company did not have any letters of credit outstanding at September 30, 2002.

The Company may use up to $500,000 for the Lender's  Cash  Management  Sublimit,
which may include merchant service,  direct deposit of payroll,  business credit
card, and check cashing services  identified in various cash management services
agreements  related to such services.  All amounts the Lender advances under any
such cash  management  services will be treated as advances  under the committed
revolving line.

Commitments

At September  30, 2002 the Company had  commitments  to purchase $2.1 million of
inventory components for the Beta-Cath(TM) System over the next six months.

On June 20, 2001, the Company  amended its  manufacturing  and supply  agreement
(Agreement) with Bebig  Isotopen-und  Medizintechnik  GmbH, a German corporation
(Bebig),   to  manufacture  and  supply  the  Company  with  radioactive  sealed
Strontium-90  seed  trains.  During  each  calendar  year  under  the  four-year
contract,  the Company  guarantees to pay to Bebig minimum annual payments which
will total $7.5 million over the tenure of the agreement.  All product purchases
are credited  against the annual  guaranteed  payment.  Any product  payments in
excess of the annual  guaranteed  payment can be credited against the guaranteed
payment  of the next  year.  In the event  that the  Company  does not  purchase
product to exceed the annual guaranteed payment,  the deficiency will be due and
payable  to Bebig  within  thirty  days  after the end of each year  during  the
four-year  contract period.  The Company expects to exceed the guaranteed amount
in 2002.

On October 14, 1999 the Company signed a development  and  manufacturing  supply
agreement  with  AEA  Technologies  QSA GmbH for the  development  of a  smaller
diameter  source.  This agreement  provided for the construction of a production
line with a cost of  construction  estimated at $4.0 million and was paid by the
Company  as  construction  was  completed.  The final cost of  construction  was
approximately  $4.8 million and it became  operational  during the third quarter
2002.

Significant  proportions  of  key  components  and  processes  relating  to  the
Company's  products  are  purchased  from  single  sources  due  to  technology,
availability,  price,  quality,  and other  considerations.  Key  components and
processes  currently  obtained from single sources include isotopes,  protective
tubing for catheters,  proprietary connectors,  and certain plastics used in the
design and  manufacture of the transfer  device.  In the event a supply of a key
single-sourced  material or component  was delayed or  curtailed,  the Company's
ability to produce the related  product in a timely  manner  could be  adversely
affected.  The Company  attempts to mitigate these risks by working closely with
key  suppliers  regarding the Company's  product  needs and the  maintenance  of
strategic inventory levels.

The Company has entered into a license  agreement  with a physician  pursuant to
which he is  entitled  to receive a royalty on the net sales of the  Beta-CathTM
System (excluding consideration paid for the radioactive isotope),  subject to a
maximum  aggregate  payment  of  $5,000,000.   Royalty  fees  to  the  physician
aggregated  $132,899 and $191,312 for the three months ended  September 30, 2002
and 2001, respectively, and have been expensed in Cost of Sales. As of September
30,  2002,  aggregate  payments of  $1,218,153  have been made under the license
agreement.

On January 30, 1996, the Company entered into a license  agreement whereby Emory
University assigned its claim to certain technology to the Company for royalties
based on net sales (as defined in the  agreement) of products  derived from such
technology,  subject to certain minimum  royalties.  After the first  commercial
sale of royalty bearing products by Novoste, minimum royalties were due to Emory
University in the following  amounts:  year 2 after the first  commercial sale -
$10,000;  year 3 - $15,000;  year 4 - $25,000;  and years 5-10 $50,000 per year.
The royalty agreement term is consistent with the life of the related patent and
applies to assignments of the patent  technology to a third party.  Royalty fees
to Emory University  aggregated $268,566 and $424,778 for the three months ended
September  30, 2002 and 2001,  respectively,  and have been  expensed in Cost of
Sales.




                                       16
<PAGE>


Liquidity

The Company's  principal  source of liquidity at September 30, 2002 consisted of
cash, cash equivalents and short-term investments of $33.4 million.

The Company had significant operating losses through the second quarter of 2001,
but was  profitable  for the  remaining  two  quarters  of 2001 and in the first
quarter of 2002. Although the third quarter shows a net loss, cash was generated
by operations  and the Company  believes that existing cash and cash expected to
be generated  from  operations  will be sufficient to meet its working  capital,
financing and capital  expenditure  requirements for the foreseeable future. The
Company's  future liquidity and capital  requirements  will depend upon numerous
factors,  including  the risks  discussed  at "Certain  Factors  That May Impact
Future Operations And Liquidity" below, and the following,  among others: market
demand for its products;  approval by the FDA to relaunch the 3.5F catheter; the
resources  required to maintain a direct sales force in the United States and in
the larger markets of Europe; the resources  required to introduce  enhancements
to and  expansion of the  Beta-Cath TM System  product  line;  the resources the
Company devotes to the  development,  manufacture and marketing of its products;
resources  expended to license or acquire new technologies;  and the progress of
the Company's clinical research and product development programs. Novoste may in
the future seek to raise  additional  funds  through  bank  facilities,  debt or
equity offering or other sources of capital. Additional financing, if, required,
may not be available on satisfactory terms, or at all.

We expect  during the  remainder  of 2002 and first  quarter of 2003 to allocate
resources to prepare for and execute the relaunch of the 3.5F  catheter when and
if the FDA approves our  pre-market  approval  supplement.  Upon relaunch of the
3.5F  catheter we will work to open  additional  3.5F sites  which will  require
additional purchases of transfer devices and radiation source trains. We believe
that our cash  generated  from  operations  and existing  cash  reserves will be
sufficient to meet our liquidity and capital spending needs at least through the
end of 2003.

RISK FACTORS

Voluntary Recall of Beta-Rail(TM) 3.5F Delivery Catheter

On  August  19,  2002,  the  Company   initiated  a  voluntary   recall  of  the
Beta-Rail(TM)  3.5F Delivery Catheter  inventory from its customers.  The recall
related  to the  discovery  by the  company  of a small  number of  catheter-tip
separations in the 3.5F product. An extensive evaluation and improvement program
was initiated.  A pre-market  approval  supplement was submitted to the Food and
Drug  Administration  ("FDA") on October 15, 2002,  defining the improvements to
the product and manufacturing processes and requesting approval for re-launch of
the  product.  The FDA has one hundred  and eighty  (180) days to act on the PMA
supplement with an approval or a denial to re-launch the product.  Additionally,
the FDA may require  additional  information from the company prior to acting on
the  application.  A  significant  delay beyond the end of 2002 could impact the
Company's competitive advantages in radiation licenses and negatively impact its
market  share.  Failure  to receive  or delays in  receipt  of FDA  approval  to
re-launch the product in a timely manner could have a material adverse effect on
our business, financial condition and results of operations. Should the FDA deny
the  Company's  request to relaunch the 3.5F  catheter the Company  would not be
able to  recover  its  investment  in 3.5F  technology  and could  substantially
impair its ability to compete in vascular brachytherapy.

We Are  Dependent  On The  Successful  Commercialization  Of  One  Product,  The
Beta-Cath(TM)System.

We began to  commercialize  the  Beta-Cath  TM  System in the  United  States in
November 2000. Substantially all of our revenue in the first nine months of 2002
was from sales in the United  States.  We  anticipate  that for the  foreseeable
future we will be solely dependent on the continued successful commercialization
of the  Beta-Cath  TM  System;  however;  in the  future  we  may be  unable  to
manufacture  the Beta-Cath  (TM ) System in commercial  quantities at acceptable
costs or to  demonstrate  that the Beta-Cath  (TM ) System is an attractive  and
cost-effective alternative or complement to other procedures, including coronary
stents, competing vascular brachytherapy devices, or drug coated stents. Because
the  Beta-Cath (TM ) System is our sole  near-term  product  focus,  we could be
required to cease operations if new technology  rendered vascular  brachytherapy
non-competitive.  Our failure to continue  commercialization of the Beta-Cath TM
System would have a material adverse effect on our business, financial condition
and results of operations.

Drug-Eluting Stents Or Other New Technology Could Render Vascular  Brachytherapy
Generally Or The Beta-Cath TM System In Particular Noncompetitive Or Obsolete.

Competition in the medical device  industry,  and  specifically  the markets for
cardiovascular  devices,  is intense and characterized by extensive research and
development  efforts and  rapidly  advancing  technology.  New  developments  in
technology could render vascular  brachytherapy  generally,  or the Beta-Cath TM
System in particular, noncompetitive or obsolete.



                                       17
<PAGE>

Vascular brachytherapy competes with other treatment methods designed to improve
outcomes  from  coronary  artery  procedures  that are well  established  in the
medical community, such as coronary stents. Stents are the predominant treatment
currently  utilized to reduce the  incidence  of coronary  restenosis  following
Percutaneous Transluminal Coronary Angioplasty ("PTCA") and were used in greater
than 80% of all PTCA procedures  performed  worldwide in 2001.  Manufacturers of
stents include  Johnson & Johnson,  Medtronic,  Inc.,  Guidant  Corporation  and
Boston Scientific Corporation. Stent manufacturers often sell many products used
in the cardiac  catheterization  labs, commonly referred to as cath labs, and as
discussed   below,   certain  of  these   companies  have   developed   vascular
brachytherapy devices.

Johnson  &  Johnson  and  Guidant  compete  directly  with  Novoste  for  market
acceptance of vascular  brachytherapy and each has substantially greater capital
resources and greater  resources and experience at introducing new products than
does Novoste. The Company may not be able to compete effectively against Johnson
& Johnson or Guidant in the vascular brachytherapy market.

Many of these same companies and others are researching  coatings and treatments
to coronary stents that could reduce  restenosis and possibly be more acceptable
to a medical  community  already  experienced  at using stents.  Clinical  trial
results have reported a significant  reduction in restenosis rates to below 10%.
In addition,  Johnson & Johnson recently received  unanimous  recommendation for
approval by a FDA  advisory  panel that its drug  eluting  stent be approved for
distribution  in the  U.S.  Full FDA  approval  could  be  expected  as early as
December  2002.  If  drug-eluting  stents are  approved for sale it could have a
material adverse effect on Novoste's business.

Our  Patents  And  Proprietary   Technology  May  Not  Adequately   Protect  Our
Proprietary Products.

Our policy is to protect our  proprietary  position  by,  among  other  methods,
filing United  States and foreign  patent  applications.  On November 4, 1997 we
were  issued  United  States  Patent No.  5,683,345,  on May 4, 1999 we received
United  States  Patent No.  5,899,882  (which is  jointly  owned by us and Emory
University)  and on  January  11,  2000 we  received  United  States  Patent No.
6,013,020,  all  related  to the  Beta  CathTM  System.  We  also  have  several
additional  United States  applications  pending  covering  other aspects of our
Beta-CathTM  System. The United States Patent and Trademark Office has indicated
that certain claims pending in another United States  application are allowable.
With respect to the above identified United States Patents and our other pending
United States patent  applications,  we have filed,  or will file in due course,
counterpart  applications  in the  European  Patent  Office  and  certain  other
countries.

Like other  firms that engage in the  development  of medical  devices,  we must
address issues and risks  relating to patents and trade  secrets.  United States
Patent No. 5,683,345 may not offer adequate protection to us because competitors
may be able to design functionally equivalent devices that do not infringe them.
They could also be reexamined, invalidated or circumvented.  Furthermore, claims
under our other pending  applications may not be allowed, or if allowed, may not
offer any  protection or may be  reexamined,  invalidated  or  circumvented.  In
addition, competitors may have or may obtain patents that will prevent, limit or
interfere  with our  ability  to make,  use or sell our  products  in either the
United States or international markets.

We May Be Unable To  Compete  Effectively  Against  Larger,  Better  Capitalized
Companies.

Many of our competitors and potential  competitors  have  substantially  greater
capital  resources  than we do and also have greater  resources and expertise in
the  area  of  research  and  development,   obtaining   regulatory   approvals,
manufacturing  and marketing.  Our  competitors  and potential  competitors  may
succeed in developing, marketing and distributing technologies and products that
are more  effective  than those we will  develop and market or that would render
our technology and products obsolete or  noncompetitive.  Additionally,  many of
the  competitors  have the  capability  to bundle a wide  variety of products in
sales to cath labs or to effectively reduce the price of competing VBT products.
We  have  experienced   significant   pricing  pressure  from  the  largest  VBT
competitor,  Guidant.  We may be  unable to  compete  effectively  against  such
competitors  and  other  potential   competitors  in  terms  of   manufacturing,
marketing, distribution, sales and servicing.




                                       18
<PAGE>


Compliance  With  Applicable  Government   Regulations  Will  Be  Expensive  And
Difficult.

Our Beta-CathTM System is regulated in the United States as a medical device. As
such, we are subject to extensive regulation by the FDA, by other federal, state
and local authorities and by foreign governments.  Noncompliance with applicable
requirements  can result in,  among  other  things,  fines,  injunctions,  civil
penalties,  recall or  seizure  of  products,  total or  partial  suspension  of
production,   failure  of  the  government  to  grant  pre-market  clearance  or
pre-market  approval  for  devices,   withdrawal  of  marketing   approvals,   a
recommendation  by the FDA that we not be  permitted  to enter  into  government
contracts,  and criminal prosecution.  The FDA also has the authority to request
repair,  replacement  or  refund  of the  cost  of any  device  manufactured  or
distributed.

The process of obtaining a pre-market  approval  and other  required  regulatory
approvals can be expensive, uncertain and lengthy, and we may be unsuccessful in
obtaining  additional approvals to market new versions of the Beta-CathTM System
or new  indications for the Beta-Cath  System.  The FDA may not act favorably or
quickly on any of our  submissions to the agency.  We may encounter  significant
difficulties  and costs in our efforts to obtain  additional  FDA approvals that
could  delay or  preclude us from  selling  new  products in the United  States.
Furthermore,  the FDA may  request  additional  data or require  that we conduct
further  clinical  studies,  causing us to incur  substantial cost and delay. In
addition,  the FDA may impose  strict  labeling  requirements,  strict  operator
training  requirements  or  other  requirements  as a  condition  of our  market
approval,  any of which could limit our ability to market our systems.  Labeling
and  marketing  activities  are  subject to  scrutiny by the FDA and, in certain
circumstances,  by the Federal Trade Commission. FDA enforcement policy strictly
prohibits  the  marketing  of  FDA  cleared  or  approved  medical  devices  for
unapproved  uses.  Further,  if a company  wishes to modify a product  after FDA
approval of a  pre-market  approval,  including  any changes  that could  affect
safety or effectiveness,  additional approvals will be required by the FDA. Such
changes  include,  but are not limited to: new indications for use, the use of a
different  facility  to  manufacture,  changes to process or package the device,
changes in  vendors to supply  components,  changes  in  manufacturing  methods,
changes  in design  specifications  and  certain  labeling  changes.  Failure to
receive or delays in receipt of FDA approvals, including the need for additional
clinical  trials or data as a  prerequisite  to approval,  or any FDA conditions
that  limit our  ability to market our  systems,  could have a material  adverse
effect on our business, financial condition and results of operations.

The  Hospitals  With Which We Do Business  May Be Delayed In Obtaining Or May Be
Unable To  Obtain  The  Licenses  To Hold,  Handle  And Use  Radiation  That Are
Required For Our Products.

Our business involves the import,  export,  manufacture,  distribution,  use and
storage of  Strontium-90  (Strontium/Yttrium),  the  beta-emitting  radioisotope
utilized in the Beta-CathTM  System 's radiation source train.  Hospitals in the
United States are required to have  radiation  licenses to hold,  handle and use
radiation.  Many of the  hospitals  and/or  physicians in the United States have
been required to amend their radiation licenses to include Strontium-90 prior to
receiving and using our Beta-CathTM System.  Depending on the state in which the
hospital is located,  its license  amendment will be processed by and its use of
the isotope  will be  regulated  by The State of Georgia  Department  of Natural
Resources  ("DNR"),  in  agreement  states,  or by  The  United  States  Nuclear
Regulatory Commission ("NRC"). Obtaining any of the foregoing  radiation-related
approvals and licenses can be complicated and time consuming and may take longer
in the NRC States  (sixteen  states).  A  significant  majority of the  approved
license  amendments  have been in Non-NRC  states.  If a  significant  number of
hospitals are delayed in obtaining approvals for the use of strontium-90,  or if
those  approvals  are not obtained or are  withdrawn  as a result of  regulatory
actions or sanctions, our business, financial condition and results of operation
could be materially adversely affected.

We May Be Unable To Obtain Foreign Approval To Market Our Products.

In order for us to market  the  Beta-CathTM  System in Japan and  certain  other
foreign  jurisdictions,  we must obtain and retain required regulatory approvals
and clearances and otherwise comply with extensive  regulations regarding safety
and  manufacturing  processes  and quality.  These  regulations,  including  the
requirements  for  approvals or  clearance  to market and the time  required for
regulatory review, vary from country to country,  and in some instances within a
country. We may not be able to obtain regulatory  approvals in such countries or
may be required to incur  significant  costs in  obtaining  or  maintaining  our
foreign  regulatory  approvals.  Delays in  receipt of  approvals  to market our
products,  failure to  receive  these  approvals  or future  loss of  previously
received  approvals  could  have a  material  adverse  effect  on our  business,
financial condition, and results of operations.



                                       19
<PAGE>

Item 3.  Quantitative And Qualitative Disclosures About Market Risk

Interest Rate Risk

The Company's cash equivalents and short-term  investments are subject to market
risk,  primarily  interest-rate  and credit risk. The Company's  investments are
managed by outside professional managers within investment guidelines set by the
Company. Such guidelines include security type, credit quality and maturity, and
are intended to limit market risk by  restricting  the Company's  investments to
high credit quality securities with relatively short-term maturities.

At September 30, 2002, the Company had $18.1 million in cash  equivalents with a
weighted average interest rate of 1.281% and $15.3 million in available-for-sale
investments with a weighted average interest rate of 2.559%.

Item 4.  Controls and Procedures

We maintain systems of internal controls and procedures for financial  reporting
("Internal  Controls")  and  disclosure  controls  and  procedures  ("Disclosure
Controls") designed to provide reasonable assurance as to the reliability of our
financial  and other  disclosures  included in this  report.  Within the 90 days
prior to the filing date of this quarterly report, we carried out an evaluation,
under the supervision and with the  participation  of our management,  including
our Chief  Executive  Officer (CEO) and Chief  Financial  Officer (CFO),  of the
effectiveness  of  the  design  and  operation  of  our  Internal  Controls  and
Disclosure Controls ("Controls Evaluation").

In the course of the Controls Evaluation, we sought to identify errors, controls
problems  and/or  acts of fraud,  and to  confirm  that  appropriate  corrective
actions,  including process  improvements,  were being  undertaken.  Among other
matters,   we  sought  to  determine   whether   there  were  any   "significant
deficiencies" or "material  weaknesses" in the Company's Internal  Controls.  In
professional auditing literature,  "significant deficiencies" are referred to as
"reportable  conditions";  they are  control  issues  that could have a material
adverse effect on the ability to record, process, summarize and report financial
data in the  financial  statements.  A  "material  weakness"  is  defined in the
auditing  literature as a particularly  serious  reportable  condition where the
internal  control  does not  reduce  to a  relatively  low  level  the risk that
misstatements  caused  by error or fraud  may  occur in  amounts  that  would be
material in relation to the financial  statements  and not be detected  within a
timely  period by employees in the normal course of  performing  their  assigned
functions.

Subsequent  to the 2001 audit  performed by our  independent  auditors,  Ernst &
Young LLP ("E & Y"), the auditors  identified  and reported to management and to
the Company's audit committee  deficiencies,  which were designated  "reportable
conditions" but not "material weaknesses".  Based upon this report we have taken
actions to address and correct the  reportable  conditions  and  strengthen  our
Internal Controls.

Our CEO and CFO have concluded that, subject to the inherent  limitations in all
control systems,  our Disclosure  Controls are effective in timely alerting them
to material  information relating to the Company that is required to be included
in our  periodic  Securities  and  Exchange  Commission  filings,  and  that our
Internal  Controls  are  effective  to  provide  reasonable  assurance  that our
financial  statements are fairly presented in conformity with generally accepted
accounting principles.

We will continue to evaluate the effectiveness of our Controls Procedures and of
the corrective  actions we have taken with regard to the deficiencies noted by E
& Y on an ongoing basis,  and we will take such further  actions as are dictated
by such continuing reviews.



                                       20
<PAGE>



PART II. OTHER INFORMATION

Item 1.  Legal Proceedings

None

Item 2.  Changes in Securities and Use of Proceeds

On  October  16,  2002,  the  Board of  Directors  of the  Company  adopted  two
amendments  to its Second  Amended and  Restated  By-laws  (the  "By-laws").  In
general,  the amendments set forth certain notice  requirements for shareholders
when  calling a special  meeting of the  Company's  shareholders  or  submitting
shareholder  proposals  (either a  shareholder  nomination of directors or other
business) at annual  meetings of the Company's  shareholders.  In addition,  the
amendment  to the  By-laws  relating to the  calling of a special  meeting  also
establishes  certain  timing  requirements  for the  setting  of the  record and
meeting dates.

Specifically,  the amendments  provide that, in addition to any other applicable
requirements,  for a  shareholder  to  properly  call  a  special  meeting,  the
shareholder must deliver to the Secretary of the Company written notice and must
include in such notice certain required information.  Business transacted at the
special  meeting  will be limited to the  purposes  stated in such  notice.  The
Secretary   will  determine  if  the  notice   complies  with  the   information
requirements  set forth in the By-laws.  If the  Secretary  determines  that the
notice complies with the information  requirements set forth in the By-laws, the
Secretary  will notify the Board of Directors.  The Board of Directors will then
meet or take action by written consent within 10 days from receiving such notice
from  the  Secretary  in  order  to fix  (1) a  record  date  to  determine  the
shareholders  entitled to receive  notice of and to vote at the special  meeting
and (2) a date and location for the special meeting of shareholders.  The record
date set by the Board of Directors may not precede or be more than 10 days after
the date of the meeting or written  consent of the Board of Directors that fixed
such  record  date.  The date of the  special  meeting  selected by the Board of
Directors may not be earlier than 45 days or later than 70 days after the record
date.

The  amendments  also  provide  that,  in  addition  to  any  other   applicable
requirements,  for a shareholder  proposal  (either a shareholder  nomination of
directors or other business) to be properly  brought before an annual meeting of
shareholders,  a shareholder must have delivered to the Secretary written notice
not less than 90 days nor more than 120 days prior to the first  anniversary  of
the  date  of  the  annual  meeting  for  the  prior  year,  except  in  certain
circumstances.  Such written notice must set forth certain required  information
including,  if  applicable,  that  information  regarding  each of the  director
nominees that would otherwise be required by the proxy rules  promulgated by the
Securities and Exchange Commission.

The foregoing  description  of the amendments to the By-laws does not purport to
be complete and is  qualified  in its  entirety by  reference to the  amendments
which are  attached as Exhibit  99.1 to the  Company's  8-K filed on October 17,
2002, and incorporated herein by reference.

Item 3.  Defaults Upon Senior Securities

None.

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

None.

Item 5.  Other Information

None.

                                       21
<PAGE>

Item 6.  Exhibits and Reports on Form 8-K

     (a) EXHIBIT
         NUMBER     DESCRIPTION
         --------   -----------

          3.1       Articles of Incorporation of Registrant, as amended. (1)

          3.2       Form of Amended and Restated  Articles of  Incorporation  of
                    Registrant filed on May 28, 1996. (1)

          3.2(a)    Copy of First Amendment to Amended and Restated  Articles of
                    Incorporation   of  Novoste   Corporation   filed  with  the
                    Department  of State of the State of Florida on  November 1,
                    1996. (2)

          3.3(a)    Copy of Amended and Restated  By-Laws of Registrant  adopted
                    December 20, 1996. (3)

          3.4       First Amendment to Second Amended and Restated By-Laws dated
                    October 16, 2002 (4)
______________________
(1)  Filed as same numbered Exhibit to the Registrant's  Registration  Statement
     on Form S-1 (File No. 333-4988).
(2)  Filed as same  numbered  Exhibit to the  Registrant's  Report on Form 8-A/A
     filed on August 3, 1999.
(3)  Filed as Exhibit A to the Registrant's  Proxy Statement for its 2001 Annual
     Meeting of Stockholders filed on April 30, 2001.
(4)  Filed as Exhibit 99.1 to the Registrant's  Current Report on Form 8-K filed
     on October 17, 2002.

     (b) Reports on Form 8-K.

     On August  20,  2002,  the  Company  filed a current  report on Form 8-K to
     disclose its voluntary recall of its Beta-Cath(TM) 3.5F delivery catheters.

     On October  17,  2002,  the Company  filed a current  report on Form 8-K to
     report the appointment of a new Chief Executive Officer and an amendment to
     the Company's Second Amended and Restated Bylaws.


                                       22
<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 hereunto duly authorized.

                                      NOVOSTE CORPORATION


/s/Alfred J. Novak                    /s/ Edwin B. Cordell, Jr.
--------------------------------      -----------------------------------
ALFRED J. NOVAK                       EDWIN B. CORDELL, JR.
Chief Executive Officer               Vice President - Finance and
(Principal Executive Officer)         Chief Financial Officer
                                      (Principal Financial & Accounting Officer)





November 14, 2002
-----------------
Date


                                       23
<PAGE>




CERTIFICATIONS

I, Alfred J. Novak, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Novoste Corporation.;

2. Based on my  knowledge,  this  quarterly  report  does not contain any untrue
statement of a material fact or omit to state a material fact  necessary to make
the statements made, in light of the  circumstances  under which such statements
were made, not  misleading  with respect to the period covered by this quarterly
report;

3.  Based  on my  knowledge,  the  financial  statements,  and  other  financial
information  included in this quarterly  report,  fairly present in all material
respects the financial  condition,  results of operations  and cash flows of the
registrant as of, and for, the periods presented in this quarterly report.

4.  The  registrant's  other  executive  officers  and  I  are  responsible  for
establishing and maintaining  disclosure  controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

     a)   designed  such  disclosure  controls  and  procedures  to ensure  that
          material  information  relating  to  the  registrant,   including  its
          consolidated subsidiaries, is made known to us particularly during the
          period in which this quarterly report is being prepared;

     b)   evaluated the  effectiveness of the registrant's  disclosure  controls
          and procedures as of a date within 90 days prior to the filing date of
          this quarterly report (the "Evaluation Date"); and

     c)   presented  in  this  quarterly   report  our  conclusions   about  the
          effectiveness  of the disclosure  controls and procedures based on our
          evaluation as of the Evaluation Date;

5. The registrant's other executive officers and I have disclosed,  based on our
most recent evaluation,  to the registrant's auditors and the audit committee of
registrant's board of directors:

     a)   all  significant  deficiencies  in the design or operation of internal
          controls  which could  adversely  affect the  registrant's  ability to
          record,  process,   summarize  and  report  financial  data  and  have
          identified for the  registrant's  auditors any material  weaknesses in
          internal controls; and

     b)   any fraud, whether or not material,  that involves management or other
          employees who have a  significant  role in the  registrant's  internal
          controls; and

6. The  registrant's  other  executive  officers  and I have  indicated  in this
quarterly  report  whether or not there  were  significant  changes in  internal
controls or in other factors that could  significantly  affect internal controls
subsequent to the date of our most recent  evaluation,  including any corrective
actions with regard to significant deficiencies and material weaknesses.

Date: November 14, 2002
                                        /s/ ALFRED J. NOVAK
                                        ---------------------------------------
                                        ALFRED J. NOVAK
                                        Chief Executive Officer



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<PAGE>



CERTIFICATIONS

I, Edwin B. Cordell, Jr., certify that:

1. I have reviewed this quarterly report on Form 10-Q of Novoste Corporation;

2. Based on my  knowledge,  this  quarterly  report  does not contain any untrue
statement of a material fact or omit to state a material fact  necessary to make
the statements made, in light of the  circumstances  under which such statements
were made, not  misleading  with respect to the period covered by this quarterly
report;

3.  Based  on my  knowledge,  the  financial  statements,  and  other  financial
information  included in this quarterly  report,  fairly present in all material
respects the financial  condition,  results of operations  and cash flows of the
registrant as of, and for, the periods presented in this quarterly report.

4.  The  registrant's  other  executive  officers  and  I  are  responsible  for
establishing and maintaining  disclosure  controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

     a)   designed  such  disclosure  controls  and  procedures  to ensure  that
          material  information  relating  to  the  registrant,   including  its
          consolidated  subsidiaries,  is made known to us,  particularly during
          the period in which this quarterly report is being prepared;

     b)   evaluated the  effectiveness of the registrant's  disclosure  controls
          and procedures as of a date within 90 days prior to the filing date of
          this quarterly report (the "Evaluation Date"); and

     c)   presented  in  this  quarterly   report  our  conclusions   about  the
          effectiveness  of the disclosure  controls and procedures based on our
          evaluation as of the Evaluation Date;

5. The  registrant's  other  executive and I have  disclosed,  based on our most
recent  evaluation,  to the  registrant's  auditors  and the audit  committee of
registrant's board of directors:

     a)   all  significant  deficiencies  in the design or operation of internal
          controls  which could  adversely  affect the  registrant's  ability to
          record,  process,   summarize  and  report  financial  data  and  have
          identified for the  registrant's  auditors any material  weaknesses in
          internal controls; and

     b)   any fraud, whether or not material,  that involves management or other
          employees who have a  significant  role in the  registrant's  internal
          controls; and

6. The  registrant's  other  executive  officers  and I have  indicated  in this
quarterly  report  whether or not there  were  significant  changes in  internal
controls or in other factors that could  significantly  affect internal controls
subsequent to the date of our most recent  evaluation,  including any corrective
actions with regard to significant deficiencies and material weaknesses.

Date: November 14, 2002
                                       /s/ EDWIN B. CORDELL, JR.
                                       ---------------------------
                                       EDWIN B. CORDELL, JR.
                                       Chief Financial Officer



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