FORM 10Q
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

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

For the quarterly period ended September 30, 1995
                               ------------------

                                  OR

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

For the transition period from_______________  to_____________

For Quarter Ended___________  Commission file number  0-16005

                           Unigene Laboratories, Inc.
             -----------------------------------------------------
             (Exact name of registrant as specified in its charter)

           Delaware                                         22-2328609
-------------------------------                         -------------------
(State or other jurisdiction of                         (I.R.S. Employer
 incorporation or organization)                         Identification No.)

110 Little Falls Road, Fairfield, New Jersey        07004
--------------------------------------------      ---------
(Address of principal executive offices)          (Zip Code)

Registrant's telephone number, including area code: (201)882-0860
                                                     ------------

--------------------------------------------------------------------------------
(Former  name,  former  address and former  fiscal year,  if changed  since last
report.)

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  registrant  was
required  to file  such  reports),  and  (2) has  been  subject  to such  filing
requirements for the past 90 days.     Yes [ X ]  No [  ]
<PAGE>
         APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
            PROCEEDINGS DURING THE PRECEDING FIVE YEARS

Indicate  by check mark  whether  the  registrant  has filed all  documents  and
reports  required  to be filed by  Sections  12,  13 or 15(d) of the  Securities
Exchange Act of 1934 subsequent to the  distribution of securities  under a plan
confirmed by a court. Yes [  ]     No  [  ]

                      APPLICABLE ONLY TO CORPORATE ISSUERS

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

Common Stock, $.01 Par Value--23,092,149 shares as of November 1, 1995
<PAGE>
                                INDEX

                      UNIGENE LABORATORIES, INC.

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements (Unaudited)

Condensed balance sheets-September 30, 1995 and
    December 31, 1994  

Condensed  statements of  operations-Three  months ended
    September 30, 1995 and 1994; Nine months ended
    September 30, 1995 and 1994

Condensed statements of cash flows-
    Nine months ended September 30, 1995 and 1994

Notes to condensed financial statements-
    September 30, 1995

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


PART II. OTHER INFORMATION


SIGNATURES
<PAGE>
PART I. FINANCIAL INFORMATION

                           UNIGENE LABORATORIES, INC.
                            CONDENSED BALANCE SHEETS
<TABLE>
<CAPTION>
                                                 September 30      December 31
                                                     1995              1994
                                                 -------------    -------------
                                                  (Unaudited)
<S>                                              <C>              <C>          
ASSETS
Current assets:
   Cash and cash equivalents .................   $      14,880    $     592,011
   Prepaid expenses and other
      current assets .........................         505,657          394,553
                                                 -------------    -------------
        Total current assets .................         520,537          986,564

Property, plant and equipment-net
   of accumulated depreciation and
   amortization ..............................      11,673,454       12,221,504
Patents and other assets .....................       1,089,278        1,003,276
                                                 -------------    -------------
                                                 $  13,283,269    $  14,211,344
                                                 =============    =============

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
   Accounts payable ..........................   $   2,670,555    $   2,399,663
   Accrued expenses ..........................         557,416          494,091
   Note payable ..............................       2,000,000             --
                                                 -------------    -------------
         Total current liabilities ...........       5,227,971        2,893,754

Notes payable - stockholders .................       1,755,000             --


Stockholders' equity:
   Common stock-par value $.01 per share;
      authorized 48,000,000 shares, issued
      and outstanding 23,092,149 shares in
      1995 and 20,918,399 shares in 1994 .....         230,921          209,184
   Additional paid-in capital ................      37,482,992       35,399,473
   Accumulated deficit .......................     (31,412,584)     (24,290,036)
   Less: Treasury stock, at cost,
      7,290 shares ...........................          (1,031)          (1,031)
                                                 -------------    -------------
        Total stockholders' equity ...........       6,300,298       11,317,590
                                                 -------------    -------------
                                                 $  13,283,269    $  14,211,344
                                                 =============    =============
See notes to condensed financial statements.
</TABLE>
<PAGE>
                       UNIGENE LABORATORIES, INC.
                   CONDENSED STATEMENTS OF OPERATIONS
                              (Unaudited)
<TABLE>
<CAPTION>
                                      Three Months Ended                   Nine Months Ended
                                         September 30                         September 30
                               -------------------------------       -------------------------------
                                   1995               1994               1995               1994
                               ------------       ------------       ------------       ------------
<S>                            <C>                <C>                <C>                <C>         
Contract and
   sales revenue ........      $        468       $      2,402       $      6,074       $    256,464
                               ------------       ------------       ------------       ------------
Operating expenses:
   Research and
      development .......         1,771,791          1,136,308          5,214,464          3,131,255
  General and
      administrative ....           574,134            422,058          1,669,403          1,101,789
                               ------------       ------------       ------------       ------------
                                  2,345,925          1,558,366          6,883,867          4,233,044
                               ------------       ------------       ------------       ------------
    Operating loss ......        (2,345,457)        (1,555,964)        (6,877,793)        (3,976,580)
                               ------------       ------------       ------------       ------------

Other income (expense):
    Interest/other income            10,463             36,441             13,983            215,983
    Interest expense ....          (164,735)              --             (258,738)              --
                               ------------       ------------       ------------       ------------
                                   (154,272)            36,441           (244,755)           215,983
                               ------------       ------------       ------------       ------------
Net loss ................      $ (2,499,729)      $ (1,519,523)      $ (7,122,548)      $ (3,760,597)
                               ============       ============       ============       ============

Net loss per share ......      $       (.12)      $       (.08)      $       (.34)      $       (.19)
                               ============       ============       ============       ============

Weighted average number
 of shares outstanding ..        21,507,522         19,731,659         21,164,060         19,663,005
                               ============       ============       ============       ============
</TABLE>
See notes to condensed financial statements.
<PAGE>
                           UNIGENE LABORATORIES, INC.
                       CONDENSED STATEMENTS OF CASH FLOWS
                                  (Unaudited)
<TABLE>
<CAPTION>
                                                       Nine Months Ended
                                                          September 30,
                                                  -----------------------------
                                                      1995             1994
                                                  ------------     ------------
<S>                                               <C>              <C>          
Cash used for operations .....................    $ (5,818,375)    $ (2,050,576)
                                                  ------------     ------------

Investing activities:

   Maturity of marketable securities .........            --          2,500,000
   Construction of leasehold improvements ....        (379,834)      (5,472,736)
   Purchase of equipment and furniture .......        (146,616)      (2,260,580)
   Increase in patents
      and other assets .......................         (92,562)        (753,420)
                                                  ------------     ------------
                                                      (619,012)      (5,986,736)
                                                  ------------     ------------
Financing activities:
         Sales of stock,
           net of related expenses ...........       1,954,334             --
         Issuance of debt ....................       4,755,000             --
         Repayment of debt ...................      (1,000,000)            --
         Exercise of stock options ...........         150,922          152,738
                                                  ------------     ------------
                                                     5,860,256          152,738
                                                  ------------     ------------
Net increase (decrease) in cash and
   cash equivalents ..........................        (577,131)      (7,884,574)

Cash and cash equivalents at
   beginning of year .........................         592,011        8,218,420
                                                  ------------     ------------
Cash and cash equivalents at
   end of period .............................    $     14,880     $    333,846
                                                  ============     ============
</TABLE>
See notes to condensed financial statements.
<PAGE>
                           UNIGENE LABORATORIES, INC.
                    NOTES TO CONDENSED FINANCIAL STATEMENTS
                               SEPTEMBER 30, 1995

NOTE A - BASIS OF PRESENTATION

The accompanying  unaudited condensed financial statements have been prepared in
accordance with generally accepted  accounting  principles for interim financial
information and with the  instructions to Form 10-Q and Article 10 of Regulation
S-X.  Accordingly,  they do not include  all of the  information  and  footnotes
required by generally  accepted  accounting  principles  for complete  financial
statements.  In the opinion of management,  all adjustments considered necessary
for a fair  presentation  have been  included.  Operating  results for the three
month and nine  month  periods  ended  September  30,  1995 are not  necessarily
indicative  of the results that may be expected for the year ended  December 31,
1995.  For  further  information,   please  refer  to  the  Company's  financial
statements and footnotes thereto included in the Company's annual report on Form
10-K for the year ended December 31, 1994.

NOTE B - DEBT FINANCING

Note  payable  at  September  30,  1995 in the  amount  of  $2,000,000  is to an
unrelated  third party,  secured by all of the Company's  assets.  This loan was
originally  due and payable July 7, 1995 with an interest  rate of 13% per annum
however,  it was formally extended to September 8, 1995 with an interest rate of
24.5% per annum.  No further formal  extension has been  obtained,  although the
Company is now  negotiating  with a third party lender and the creditor for full
payment  to the  creditor.  1,000,000  from  this loan was used to pay off other
short-term debt.

Notes  payable to  stockholders,  totaling  $1,755,000  at  September  30, 1995,
consist of notes to Warren P. Levy,  Ronald S. Levy and Jay Levy,  officers  and
directors  of the  Company,  and a member  of their  family.  These  notes  bear
interest at the Merrill  Lynch Margin Loan Rate  (approximately  9% at September
30, 1995) and are secured by security interests in the Company's Fairfield plant
and Boonton  equipment.  Notes for $1,105,000 are payable on demand.  A note for
$650,000 is due on February 10, 1997.

NOTE C - STOCK SALE

From July 1 through  September 30, 1995, the Company sold in private  placements
approximately 2 million shares of its common stock at a price of $1 per share.
<PAGE>
          MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                           AND RESULTS OF OPERATIONS


LIQUIDITY AND CAPITAL RESOURCES

During  1994,  the Company  completed  construction  of its  peptide  production
facility in  Boonton,  New  Jersey.  The  facility  was  constructed  in a shell
building that is being leased under a ten year net lease which began in February
1994.  The  Company  has two ten year  renewal  options  as well as an option to
purchase  the  facility.  The total cost of leasehold  improvements  and process
equipment  for  this  facility,   including   current   validation   costs,   is
approximately  $11.7  million.  The Company is  undertaking  steps to secure the
validation  of the facility by the U.S.  Food and Drug  Administration  to allow
Unigene to provide its calcitonin  for human use. The Company,  at September 30,
1995,  had cash and cash  equivalents  of $15,000,  a decrease of $577,000  from
December 31, 1994.

From February  through  September 1995,  Warren P. Levy,  Ronald S. Levy and Jay
Levy, officers and directors of the Company, and a member of their family loaned
a total of  $1,755,000  to the  Company.  During  October  1995,  they loaned an
additional  $150,000 to the  Company.  A total of  $1,850,000  of these loans is
secured  by liens on the  Fairfield  plant and  equipment.  In March  1995,  the
Company  borrowed  $1,000,000 from an unrelated third party.  This note was paid
off in May 1995. In May 1995, the Company borrowed  $2,000,000 from an unrelated
third party on a short-term  basis  secured by all of the assets of the Company.
In  connection  with  that  loan,  the  members  of the Levy  family  agreed  to
subordinate their security interests in the Fairfield plant and equipment to the
secured lender and received a subordinated security interest on the equipment at
the Boonton plant. This loan was originally due and payable July 7, 1995 with an
interest rate of 13% per annum however, it was formally extended to September 8,
1995 with an interest rate of 24.5% per annum.  No further formal  extension has
been obtained, although the Company is now negotiating with a third party lender
and the creditor for full payment to the creditor. $1,000,000 from this loan was
used to pay off the $1,000,000  short-term  debt. From July 1 through  September
30, 1995, the Company sold in private placements  approximately 2 million shares
of its common stock at a price of $1 per share.

The  Company's  ability to  generate  additional  cash from  operations  depends
primarily  upon signing  research or  licensing  agreements,  achieving  defined
benchmarks  in  such  agreements,  completion  of  plant  validation,  receiving
regulatory  approval  for  its  products,  and  marketing  hormones  and  enzyme
products.  The  Company has signed one joint  venture  agreement.  However,  the
Company has not yet received any revenue  from this  agreement,  and there is no
assurance that any revenues will be received.

The Company requires additional cash to continue its operations.  The Company is
seeking  additional  financing,  but there is no assurance that sufficient funds
will be obtained.  The Company requires  additional cash during the remainder of
the fourth quarter of 1995 to continue operations.


OPERATING RESULTS

Current  operating  revenues are from hormone and enzyme sales which were $6,000
for the nine months  ended  September  30,  1995.  Operating  revenues  for 1994
include  a final  payment  from a prior  research  agreement  in the  amount  of
$250,000.

Research and  development,  the Company's  largest  expense,  increased 56% from
$1,136,000 to  $1,772,000  and 67% from  $3,131,000 to $5,214,000  for the three
months and nine months ended  September 30, 1995,  respectively,  as compared to
the  same  periods  in  1994.  The  increases  were  related  to  the  Company's
manufacturing  facility  including  depreciation  charges and  expenditures  for
preproduction  salaries,  its  development  program  for  the  calcitonin  pill,
regulatory consulting fees, as well as the sponsorship of collaborative research
programs.

General and administrative expenses increased 36% from $422,000 to $574,000, and
51% from  $1,102,000  to  $1,669,000  for the three months and nine months ended
September 30, 1995,  respectively,  as compared to the same periods in 1994. The
increases  were primarily due to legal and other  expenses  associated  with the
Company's financing activities.

Interest and other income  decreased  $26,000 or 71% and $202,000 or 94% for the
three months and nine months ended September 30, 1995, respectively, as compared
to the same  periods in 1994.  The  decreases  were due to a reduction  in total
monies available to be invested.

Interest  expense was $165,000 and $259,000 for the three months and nine months
ended  September 30, 1995,  respectively.  Interest is payable on notes totaling
$3,755,000  as of September  30, 1995.  There were no notes  outstanding  during
1994.

As a result of increased  operating  expenses  and  interest  expense as well as
decreased  operating  revenues and interest income,  net loss increased $980,000
and  $3,362,000  for the three months and nine months ended  September 30, 1995,
respectively, from the corresponding periods in 1994.

As of December  31, 1994,  the Company had  available  for income tax  reporting
purposes  net  operating  loss   carryforwards  in  the  approximate  amount  of
$24,000,000,  expiring  from 1996 through  2009,  which are  available to reduce
future  earnings which would  otherwise be subject to federal income taxes.  For
the nine months ending September 30, 1995, the Company had additional  losses of
approximately  $7,000,000.  In addition,  the Company has investment tax credits
and research and  development  credits in the amounts of $69,000 and $1,339,000,
respectively,  which are available to reduce the amount of future federal income
taxes. These credits expire from 1996 through 2009.

The Company follows  Statement of Financial  Accounting  Standards No. 109 (FASB
109),  "Accounting  for  Income  Taxes".  Given the  Company's  past  history of
incurring  operating losses, any deferred tax assets that are recognizable under
FASB 109 have been fully  reserved.  As of January 1, 1995,  under FASB 109, the
Company  had  deferred  tax assets of  approximately  $11,100,000,  subject to a
valuation  allowance of  $11,100,000.  The  deferred  tax assets were  generated
primarily  as a result of the  Company's  net  operating  losses and tax credits
generated.  For the nine month period ended  September  30, 1995,  the Company's
deferred tax assets and valuation  allowances  each  increased by  approximately
$2,800,000.
<PAGE>
PART II.  OTHER INFORMATION

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

(a)      Exhibits - none.

(b)      Reports on Form 8-K.

         The Company filed a current report on Form 8-K dated July 13, 1995 with
         respect to the extension of the Company's  short-term debt financing in
         the amount of $2,000,000.




                                   SIGNATURES

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


                                            UNIGENE LABORATORIES, INC.
                                            -----------------------------
                                            (Registrant)


                                            /s/ Warren P. Levy
         November 10, 1995                  -----------------------------
                                            Warren P. Levy, President
                                            (Chief Executive Officer)


                                            /s/ Jay Levy
         November 10, 1995                  -----------------------------
                                            Jay Levy, Treasurer
                                            (Chief Financial Officer and
                                             Chief Accounting Officer)