<PAGE>


                                 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 QUARTER ENDED MARCH 31, 1997

                                       or

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


                          Commission file number 1-14430


                            MAXIM PHARMACEUTICALS, INC. 
              (Exact name of registrant as specified in its charter)



               Delaware                              87-0279983
       ---------------------------------------------------------------------
       (State of incorporation)         (I.R.S. Employer Identification No.)


        3099 Science Park Road, Suite 150, San Diego, CA          92121
       ---------------------------------------------------------------------
           (Address of principal executive offices)            (Zip  Code)

                                 (619) 453-4040
             ----------------------------------------------------
             (Registrant's telephone number, 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 filing requirements for the past 90 days.   Yes  X   No
                                                     ---     ---

As of May 5, 1997, the registrant had 6,671,246 shares of Common Stock, $.001 
par value, outstanding.


<PAGE>


                            MAXIM PHARMACEUTICALS, INC.
                           (A Development Stage Company)



                                      INDEX

PART I - FINANCIAL INFORMATION                                          Page
                                                                        ----
     Item 1.   Financial Statements

               Balance Sheets -
               March 31, 1997 (unaudited) and September 30, 1996.....     1

               Statements of Operations (unaudited) -
               Three Months and Six Months Ended March 31, 1997
               and 1996, and from Inception (October 23, 1989)
               through March 31, 1997................................     2

               Statements of Cash Flows (unaudited) -
               Six Months Ended March 31, 1997 and 1996
               and from Inception (October 23, 1989) through
               March 31, 1997........................................     3
     
               Notes to Financial Statements.........................     4



     Item 2.   Management's Discussion and Analysis of
               Financial Condition and Results of Operations.........     5


PART II - OTHER INFORMATION

     Item 1.   Legal Proceedings.....................................     7

     
     Item 4.   Submission of Matters to a Vote of Security Holders...     7


     Item 6.   Exhibits and Reports on Form 8-K......................     7


SIGNATURE   .........................................................     8

<PAGE>

BALANCE SHEETS

MAXIM PHARMACEUTICALS, INC.  (A DEVELOPMENT STAGE COMPANY)


<TABLE>
<CAPTION>
                                                       MARCH 31, 1997           September 30, 1996
                                                       --------------           -------------------
                                                         (UNAUDITED)
<S>                                                    <C>                      <C>
ASSETS
CURRENT ASSETS:                                        
 Cash and cash equivalents                             $  1,355,457                  $   4,070,089 
 Short-term investments in marketable securities         11,535,617                     12,563,622 
 Accrued interest and other current assets                  662,339                        709,285 
                                                       --------------           -------------------
               Total current assets                      13,553,413                     17,342,996 
                                        
Investments in marketable securities                      3,609,500                      2,510,366 
Patents and licenses, net                                 1,811,098                      1,367,235 
Property and equipment, net                                 609,376                         31,037 
Deposits                                                    203,397                          3,397 
                                                       --------------           -------------------
               Total assets                            $ 19,786,784                  $  21,255,031 
                                                       --------------           -------------------
                                                       --------------           -------------------
                                        
                                        
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)                                       
CURRENT LIABILITIES:                                        
     Accounts payable                                  $    754,770                  $     405,760
     Accrued expenses                                       580,368                        478,623
     Current portion of long-term debt                      264,008                        247,000
                                                       --------------           -------------------
          Total current liabilities                       1,599,146                      1,131,383
                                        
     Long-term debt, less current portion                   391,187                              -
                                        
                                        
STOCKHOLDERS' EQUITY:                                       
  Preferred stock, $.001 par value, 5.000,000 shares 
   authorized                                                     -                              -
  Common stock, $.001 par value,  20,000,000 shares 
   authorized; 6,671,246 and 6,671,237 shares issued 
   and outstanding at March 31, 1997 and September 30,
   1996, respectively.                                        6,672                          6,672
  Additional paid-in capital                             34,172,686                     34,172,618
  Deficit accumulated during the development stage      (16,298,081)                   (13,936,903)
  Deferred compensation                                     (84,826)                      (118,739)
                                                       --------------           -------------------
          Total stockholders' equity                     17,796,451                     20,123,648
                                                       --------------           -------------------
               Total liabilities and stockholders' 
                equity                                 $ 19,786,784                  $  21,255,031 
                                                       --------------           -------------------
                                                       --------------           -------------------
</TABLE>

SEE NOTES TO FINANCIAL STATEMENTS


                                       1
<PAGE>

STATEMENTS OF OPERATIONS (UNAUDITED)    

MAXIM PHARMACEUTICALS, INC. (A DEVELOPMENT STAGE COMPANY)   

<TABLE>
<CAPTION>
                                            Three Months Ended            Six Months Ended         October 23, 1989
                                                March 31                      March 31              (inception) to
                                           1997           1996          1997             1996       March 31, 1997
                                        -------------  -----------   -------------   -----------  ----------------
<S>                                     <C>            <C>           <C>             <C>          <C>
Operating expenses: 
  Product development                   $  1,215,456   $  593,896    $  1,755,048    $  813,284   $  11,756,306 
  Business development                        99,425       24,597         163,179        55,985         225,179 
  General and administrative                 493,119      208,790         901,385       387,089       8,427,192 
                                        -------------  -----------   -------------   -----------  ----------------
    Total operating expenses               1,808,000      827,283       2,819,612     1,256,358      20,408,677 
          
          
Other income (expense):                               
  Investment income                          239,918        3,369         505,160         6,908         792,890 
  Interest expense                           (14,972)     (21,411)        (32,305)     (152,625)     (1,936,114)
  Other expense                              (13,564)     (76,684)        (14,421)      (90,813)       (116,209)
  Research grant revenue                           -            -               -             -       2,946,001 
  Gain on sale of subsidiary                       -            -               -             -       2,288,474 
                                        -------------  -----------   -------------   -----------  ----------------
    Total other income (expense)             211,382      (94,726)        458,434      (236,530)      3,975,042 
                                        -------------  -----------   -------------   -----------  ----------------
          
Discontinued operations:                              
  Loss from operation of discontinued               
    diagnostic division                            -            -               -             -        (347,608)
  Gain on sale of diagnostic division              -            -               -             -         483,162 
                                        -------------  -----------   -------------   -----------  ----------------
          
Net loss                                $ (1,596,618)  $  (922,009)  $ (2,361,178)   $(1,492,888)  $(16,298,081)
                                        -------------  -----------   -------------   -----------  ----------------
                                        -------------  -----------   -------------   -----------  ----------------


Net loss per share of common stock      $      (0.24)  $     (0.16)  $      (0.35)   $     (0.28)
                                        -------------  -----------   -------------   ----------- 
          
          
Weighted average shares outstanding        6,671,238     5,874,383      6,671,238      5,407,379
                                        -------------  -----------   -------------   -----------
</TABLE>
          
SEE NOTES TO FINANCIAL STATEMENTS                      


                                       2

<PAGE>


STATEMENTS OF CASH FLOWS (UNAUDITED)                   

MAXIM PHARMACEUTICALS, INC. (A DEVELOPMENT STAGE COMPANY)           

<TABLE>
<CAPTION>
                                                                   Six Months Ended           
                                                                       March 31               October 23, 1989
                                                           ------------------------------      (inception) to
                                                               1997               1996         March 31, 1997
                                                           -----------       -------------    ----------------- 
<S>                                                        <C>               <C>              <C> 
OPERATING ACTIVITIES:     
 Net loss                                                  $(2,361,178)      $  (1,492,888)     $ (16,298,081)
 Adjustments to reconcile net loss to net cash                        
 used in operating activities:                                        
     Depreciation and amortization                             103,347               7,131            884,491 
     Amortization of premium on investments                     84,308                   -             84,308 
     Stock options issued as compensation                       33,913                   -            310,173 
     Gain on sale of subsidiary                                      -                   -         (2,288,474)
     Loss on write-off of patents                                    -                   -            189,068 
     Loss on disposal of property & equipment                        -             128,248            128,248 
     Loss on write-off of receivable from related party              -             100,000            147,803 
     Other                                                           -                   -             27,032 
     Write-off of obsolete inventory                                 -                   -             24,669 
     Gain on sale of diagnostic division                             -                   -           (483,162)
     Loss on write-off of purchased research  
          and development                                            -                   -          2,646,166 
     Cumulative effect of reorganization                             -                   -          1,152,667 
     Changes in operating assets and liabilities: 
          Accrued interest and other current assets             46,946             (10,070)          (662,339)
          Other assets                                        (200,000)            (15,574)          (351,200)
          Accounts payable                                     349,010             (30,067)           754,770 
          Accrued expenses                                     101,745             104,508            601,578 
                                                            ----------          ----------        ----------- 
          Net cash used in operating activities             (1,841,909)         (1,208,712)       (13,132,283)
     
INVESTING ACTIVITIES:                                                
Purchases of marketable securities                          (8,151,437)                  -        (23,225,425)
Maturities of marketable securities                          7,996,000                   -          7,996,000 
Additions to patents                                          (513,201)           (115,227)        (2,355,988)
Purchases of property and equipment                           (612,348)             (3,481)        (1,420,589)
Cash acquired in acquisition of business                             -                   -            985,356 
Proceeds from sale of diagnostic division                            -                   -            496,555
                                                            ----------          ----------        -----------  
     Net cash used by investing activities                  (1,280,986)           (118,708)       (17,524,091)
     
FINANCING ACTIVITIES:                                                
Proceeds from issuance of notes payable and                          
     long term debt                                            408,195              81,675          4,984,618 
Payments on notes payable and long-term debt                         -          (2,260,000)        (2,770,505)
Proceeds from issuance of notes payable to                           
     related parties                                                 -                   -          4,982,169 
Payments on notes payable to related parties                         -                   -         (1,329,885)
Net proceeds from issuance of common stock                            
     and warrants                                                   68           4,301,498         25,657,934 
Net proceeds from issuance of preferred stock                        -                   -            487,500 
                                                            ----------          ----------         ----------- 
     Net cash provided by financing activities                 408,263           2,123,173         32,011,831 
                                                            ----------          ----------         ----------- 
Net increase (decrease) in cash and cash equivalents        (2,714,632)            795,753          1,355,457 
     
Cash and cash equivalents at beginning of period             4,070,089             512,928                  - 
                                                          ------------        ------------        ------------ 
Cash and cash equivalents at end of period                 $ 1,355,457       $   1,308,681        $ 1,355,457 
                                                          ------------        ------------        ------------ 
</TABLE>

SEE NOTES TO FINANCIAL STATEMENTS.


                                        3
<PAGE>

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

MAXIM PHARMACEUTICALS, INC. (A DEVELOPMENT STAGE COMPANY)



1.  PRINCIPLES OF INTERIM PERIOD REPORTING

Maxim Pharmaceuticals, Inc. (the "Company") has not earned significant revenues
from planned principal operations.  Accordingly, the Company's activities have
been accounted for as those of a "Development Stage Enterprise" as set forth in
Financial Accounting Standards Board Statement No. 7 ("FAS 7").

In the opinion of the Company, the unaudited financial statements contain all of
the adjustments, consisting only of normal recurring adjustments and accruals,
necessary to present fairly the financial position of the Company as of March
31, 1997 and September 30, 1996, and the results of operations for the three
months and six months ended March 31, 1997 and 1996 and from inception (October
23, 1989) to March 31, 1997.  The results of operations for the three months and
six months ended March 31, 1997 are not necessarily indicative of the results to
be expected in subsequent periods or for the year as a whole.  For further
information, refer to the consolidated financial statements and footnotes
thereto for the year ended September 30, 1996.


2.  LINE OF CREDIT AGREEMENT

In March 1997 the Company entered into a line of credit agreement with a bank. 
Under the agreement the Company may borrow up to $900,000 during 1997 to fund
qualified equipment purchases.  At January 1, 1998 any outstanding advances
under the line of credit will convert to a term loan payable in equal
installments over 48 months, including interest at prime plus 0.5%.  The loan is
secured by all assets of the Company.  At March 31, 1997, aggregate advances
under the line of credit totaled $408,195.


3.  CONTINGENCY

In April 1996, the Company received a demand letter from an attorney 
representing the former President and Chief Operating Officer and Chief 
Financial Officer of the Company (the "Former Employees").  In the letter, 
the Former Employees made claims for certain purported damages in contract 
and in tort arising out of the termination of the Former Employees' 
employment with the Company.  In addition, the Former Employees asserted 
possible punitive damages and damages based on emotional distress.  The 
Former Employees also claimed the right to vested options of the Company's 
common stock, which options have subsequently terminated.  In March 1997 the 
Former Employees filed a complaint in the Superior Court in the State of 
California, County of San Diego (the "Complaint") seeking claims for certain 
purported damages in contract and in tort arising from their respective 
terminations.  The aggregate amount of economic damages, punitive damages and 
damages based on emotional distress claimed by the Former Employees in the 
Complaint approximated $14 million.  The Company has not received any 
communication from the Former Employees regarding the Complaint, and the 
Company has not been formally served with a summons.  Although the Company's 
intention is to contest any such claims vigorously when and if the complaint 
is served, there can be no assurances as to the eventual outcome of such 
claims or their effect on the Company's financial condition and results of 
operations.  In addition, an adverse determination in any litigation arising 
from these claims or the settlement of such claims could have a material 
adverse effect on the Company, its financial condition and its results of 
operations.

                                       4

<PAGE>

MANAGEMENT'S DISCUSSION AND ANALYSIS OF 
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

MAXIM PHARMACEUTICALS, INC. (A DEVELOPMENT STAGE COMPANY)


THIS MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS 
OF OPERATIONS CONTAINS CERTAIN FORWARD-LOOKING STATEMENTS THAT INVOLVE RISKS 
AND UNCERTAINTIES. THE COMPANY'S ACTUAL RESULTS MAY DIFFER MATERIALLY FROM 
THOSE ANTICIPATED IN THESE FORWARD-LOOKING STATEMENTS.  FACTORS THAT MAY 
CAUSE SUCH DIFFERENCES INCLUDE, BUT ARE NOT LIMITED TO, THOSE DISCUSSED UNDER 
"RISK FACTORS" AND ELSEWHERE IN THE COMPANY'S ANNUAL REPORT ON FORM 10-K FOR 
THE YEAR ENDED SEPTEMBER 30, 1996, AS FILED WITH THE SECURITIES AND EXCHANGE 
COMMISSION, INCLUDING THE UNCERTAINTIES ASSOCIATED WITH PRODUCT DEVELOPMENT, 
THE RISK THAT PRODUCTS THAT APPEARED PROMISING IN EARLY CLINICAL TRIALS DO 
NOT DEMONSTRATE EFFICACY IN LARGER-SCALE CLINICAL TRIALS, THE RISK THAT 
CLINICAL TRIALS WILL NOT COMMENCE WHEN PLANNED AND THE RISK THAT THE COMPANY 
WILL NOT BE ABLE TO COMPLETE CORPORATE COLLABORATIONS. 

RESULTS OF OPERATIONS FOR THE THREE MONTHS AND SIX MONTHS ENDED MARCH 31, 
1997 AND 1996

PRODUCT DEVELOPMENT EXPENSES - For the quarter ended March 31, 1997, product
development expenses were $1,215,000, an increase of $622,000, or 105%, over the
same period in the prior year.  This increase was primarily attributable to
increased activity related to cancer clinical trials of the Company's MAXAMINE-
TM- therapy, including hiring additional clinical and development personnel, and
consulting and other costs associated with preparation for planned Phase III
clinical trials in the United States.  The current quarter increase also
resulted from increased efforts relating to preclinical development of the
Company's MAXVAX-TM- mucosal vaccine technology, including the addition of
laboratory personnel and establishment of internal research capabilities. 

For the six months ended March 31, 1997, product development costs were
$1,755,000, an increase of $942,000, or 116%, over the same period of the prior
year.  The increase resulted from the Phase III clinical trial efforts and the
expansion of other product development activities described above.

BUSINESS DEVELOPMENT AND GENERAL AND ADMINISTRATIVE EXPENSES - For the quarter
ended March 31, 1997, business development expenses totaled $99,000, an increase
of $75,000 over the $25,000 in expense recorded in the same quarter in the prior
year.  This increase was due to additional personnel and other resources devoted
to corporate partnering efforts and market evaluations.  General and
administrative expenses for the quarter ended March 31, 1997 increased $284,000,
or 136%, over the prior year quarter and totaled $493,000.  This increase is in
a large part due to the increased personnel, insurance, reporting and compliance
costs associated with operation as a public company.

Business development costs for the six month period ended March 31, 1997 totaled
$163,000, an increase of $107,000, or 191%, over the same period of the prior
year.  General and administrative expenses for the six month period ended March
31, 1997 increased $514,000, or 133%, over the same period of the prior year to
$901,000.  Both of these increases resulted from the expanded activities
described above.

OTHER INCOME (EXPENSE)  - Investment income was $240,000 for the quarter ended
March 31, 1997, compared to $3,000 for the same period in the prior year, due to
income on the proceeds of the Company's initial public offering completed in
July 1996.  Interest expense for the current quarter was $15,000, consistent
with the $21,000 expense for the same quarter in the prior year. 

Investment income was $505,000 for the six month period ended March 31, 1997,
compared to $7,000 for the same period in the prior year, due to the income on
the offering proceeds described above.  Interest expense was $32,000 compared to
$153,000 for the six month period in the prior year.  The current year decrease
is due to the repayment of approximately $2.85 million of notes payable and
long-term debt subsequent to December, 1995.

                                       5

<PAGE>

NET LOSS - Net loss for the quarter ended March 31, 1997 totaled $1,567,000, 
a 70% increase over the prior year's second quarter loss of $922,000.  This 
increase is a result of the expanded product development, business 
development and general corporate efforts discussed above.  Net loss per 
share of common stock for the quarter ended March 31, 1997 was $.23, a 44% 
increase from the prior years second quarter loss of $.16 per share.

Net loss for the six months ended March 31, 1997 totaled $2,331,000, an increase
of $838,000, or 56% over the same period of the prior year.  Net loss per share
of common stock for the six month period was $.35, a 25% increase over the loss
of $.28 per share for the same period of the prior year.  

LIQUIDITY AND CAPITAL RESOURCES 

The Company has financed its operations primarily through the sale of its equity
securities, including an initial public offering of common stock and redeemable
common stock purchase warrants in July 1996 which provided approximately $18.2
million, net of financing costs, to the Company. 

As of March 31, 1997, the Company had cash, cash equivalents and investments
totaling approximately $16.5 million.  For the six months ended March 31, 1997,
net cash used in the Company's operating activities was approximately
$1,842,000.  The Company expects its cash requirements to increase significantly
in future periods as it conducts additional product development activities
including internal product research, development and testing, preclinical
studies and clinical testing of its potential products and marketing of any
products that are developed.  Among the specific planned activities which are
expected to result in an increase in cash requirements are the commencement of
Phase III clinical trials in the U.S. for the MAXAMINE therapy, and an expansion
of internal capabilities and increased research efforts relating to preclinical
development of the MAXVAX technology.   

The Company's cash requirements may vary materially from those now planned
because of the results of research, development and clinical trials, the time
and costs involved in obtaining regulatory approvals, the cost of filing,
prosecuting, defending and enforcing patent claims and other intellectual
property rights, competing technological and market developments, changes in the
Company's existing research relationships, the ability of the Company to
establish collaborative arrangements and the development of the Company's
product commercialization activities.  As a result of these factors, it is
difficult to predict accurately the timing and amount of the Company's cash
requirements.

In order to successfully commercialize any of its products, the Company expects
that it will ultimately be required to seek additional funds through public or
private financings or collaborative arrangements with corporate partners.  The
issuance of additional equity securities could result in substantial dilution to
the Company's stockholders.  There can be no assurance that additional funding
will be available on terms acceptable to the Company, if at all.  The failure to
fund its capital requirements would have a material adverse effect on the
Company's business.

The Company has never paid a cash dividend and does not contemplate the payment
of cash dividends in the foreseeable future.

                                       6
<PAGE>

PART II-OTHER INFORMATION


ITEM 1.  LEGAL PROCEEDINGS

In April 1996, the Company received a demand letter from an attorney 
representing the former President and Chief Operating Officer and Chief 
Financial Officer of the Company (the "Former Employees").  In the letter, 
the Former Employees made claims for certain purported damages in contract 
and in tort arising out of the termination of the Former Employees' 
employment with the Company.  In addition, the Former Employees asserted 
possible punitive damages and damages based on emotional distress.  The 
Former Employees also claimed the right to vested options of the Company's 
common stock, which options have subsequently terminated.  In March 1997 the 
Former Employees filed a complaint in the Superior Court in the State of 
California, County of San Diego (the "Complaint") seeking claims for certain 
purported damages in contract and in tort arising from their respective 
terminations. The aggregate amount of economic damages punitive damages and 
damages based on emotional distress claimed by the Former Employees in the 
Complaint approximated $14 million.  The Company has not received any 
communication from the Former Employees regarding the Complaint, and the 
Company has not been formally served with a summons.  Although the Company's 
intention is to contest any such claims vigorously when and if the complaint 
is served, there can be no assurances as to the eventual outcome of such 
claims or their effect on the Company's financial condition and results of 
operations.  In addition, an adverse determination in any litigation arising 
from these claims or the settlement of such claims could have a material 
adverse effect on the Company, its financial condition and its results of 
operations.

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

At the Annual Meeting of Stockholders on February 10, 1997, the following
matters were voted on and approved:

1.   Two Directors were elected to the Board of Directors to hold office for a
     three-year term or until their successors are elected and qualified.  The
     following persons were elected:  G. Steven Burrill and F. Duwaine Townsen. 
     5,511,047 shares of Common Stock, or 99.0% of the shares voting, voted in
     favor of all the nominees for Director listed in the Proxy Statement. 
     There were no votes against any Director and 55,000, or 1.0% of the shares
     voting, abstained. The remaining three Directors, Per-Olof Martensson, 
     Larry G. Stanbaugh, and Colin B. Bier, Ph.D continue in office until 
     future Annual Meetings.

2.   Approval of the 1993 Long-Term Incentive Plan, as amended to, among other
     things, increase the aggregate number of shares authorized for issuance
     under the Incentive Plan from a total of 800,000 shares to 1,000,000
     shares.  4,268,608 shares of Common Stock, or 93% of the shares voting,
     voted in favor of the proposal.  317,133 shares, or 6.9% of the voting
     shares, voted against the proposal, 4,700 shares, or 0.1% of the voting
     shares, abstained, and 975,606 shares were broker non-votes.

3.   The Boards selection of KPMG Peat Marwick LLP as the Company's independent
     public accountants for the fiscal year ended September 30, 1997 was
     ratified.  5,512,447 shares of Common Stock, or 99% of the shares voting,
     voted in favor of the proposal.  53,600 shares, or 1.0% of the voting
     shares, voted against the proposal, and no shares abstained.

                                       7
<PAGE>

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

A)   EXHIBITS

Exhibit Number                       Description of Exhibit
--------------                       ----------------------

   10.22                             Loan and Security Agreement between the 
                                     Registrant and Silicon Valley Bank



B.)  REPORTS ON FORM 8-K

Date of Report               Item Reported           Financial Statements Filed
--------------               -------------           --------------------------

None                                 None                                  No

















Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.


                    Maxim Pharmaceuticals,  Inc.



Date:  May 5, 1997        /s/ Dale A. Sander      
                          ------------------------
                          Dale A. Sander
                          Chief Financial Officer
                          (Principal Accounting Officer and Officer
                          duly authorized to sign this report on
                          behalf of the registrant)

                                       8