<PAGE>

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549

                                    FORM 10-Q


(Mark One)

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

For the quarterly period ended JUNE 30, 2000


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

For the transition period from ________________ to ______________

Commission file number 0-18006


                         THE IMMUNE RESPONSE CORPORATION
             (Exact Name of Registrant as Specified in its Charter)


               DELAWARE                                 33-0255679
(State or Other Jurisdiction of             (IRS Employer Identification Number)
 Incorporation or Organization)


                      5935 DARWIN COURT, CARLSBAD, CA 92008
                    (Address of Principal Executive Offices)
                                   (Zip Code)


                            TELEPHONE (760) 431-7080
              (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 ___

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

As of July 25, 2000, 27,412,231 shares of common stock were outstanding.



<PAGE>

                         THE IMMUNE RESPONSE CORPORATION

                                    FORM 10-Q

                                QUARTERLY REPORT


                                TABLE OF CONTENTS
<TABLE>
<CAPTION>
                                                                                      PAGE
                                                                                      ----
<S>        <C>                                                                        <C>
                         PART I - FINANCIAL INFORMATION


Item 1.    Financial Statements

               Condensed Consolidated Balance Sheets                                    3
               Condensed Consolidated Statements of Operations                          4
               Condensed Consolidated Statements of Cash Flows                          5
               Notes to Condensed Consolidated Financial Statements                     6


Item 2.    Management's Discussion and Analysis of Financial Condition
           and Results of Operations                                                    8

Item 3.    Quantitative and Qualitative Disclosures about Market Risk                  17


                           PART II - OTHER INFORMATION


Item 4.    Submission of Matters to a Vote of Security Holders                         18

Item 6.    Exhibits and Reports on Form 8-K                                            18

Signature                                                                              19
</TABLE>


                                       2
<PAGE>

PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS

                         THE IMMUNE RESPONSE CORPORATION

                      CONDENSED CONSOLIDATED BALANCE SHEETS
                    (amounts in thousands, except share data)
<TABLE>
<CAPTION>
                                                                                    JUNE 30,                   DECEMBER 31,
                                                                                      2000                        1999
                                                                            --------------------------   --------------------------
                                                                                   (unaudited)
<S>                                                                         <C>                          <C>
Assets

Current assets:
    Cash and cash equivalents                                               $                   9,287    $                   4,183
    Marketable securities - available-for-sale                                                 15,947                       18,904
    Other current assets                                                                          462                          202
                                                                            --------------------------   --------------------------
            Total current assets                                                               25,696                       23,289

Property and equipment, net                                                                     9,159                       10,760
Licensed technology                                                                             4,592                        4,945
Deposits and other assets                                                                         847                        1,003
                                                                            --------------------------   --------------------------
                                                                            $                  40,294    $                  39,997
                                                                            ==========================   ==========================
Liabilities and stockholders' equity

Current liabilities:
    Accounts payable                                                        $                   1,503    $                   1,536
    Accrued expenses                                                                            1,581                        3,024
    License contract payable                                                                      480                        3,609
    Current portion of equipment notes payable                                                    541                          287
    Deferred rent obligation                                                                       88                          147
                                                                            --------------------------   --------------------------
            Total current liabilities                                                           4,193                        8,603

Equipment notes payable                                                                         2,146                        1,221

Redeemable, convertible preferred stock                                                         9,767                        9,627

Stockholders' equity:
    Preferred stock, 5,000,000 shares authorized; 200 shares issued
        and outstanding as redeemable, convertible preferred stock                                  -                            -
    Common stock, $.0025 par value, 65,000,000 shares authorized,
        27,376,585 and 26,370,135 shares issued and outstanding at
        June 30, 2000 and December 31, 1999, respectively                                          68                           66
    Warrants                                                                                    2,144                        2,144
    Additional paid-in capital                                                                211,039                      203,131
    Accumulated other comprehensive income                                                      2,643                        1,735
    Accumulated deficit                                                                      (191,706)                    (186,530)
                                                                            --------------------------   --------------------------
            Total stockholders' equity                                                         24,188                       20,546
                                                                            --------------------------   --------------------------
                                                                            $                  40,294    $                  39,997
                                                                            ==========================   ==========================
</TABLE>


See accompanying notes.


                                       3
<PAGE>

                         THE IMMUNE RESPONSE CORPORATION

                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                    (amounts in thousands, except share data)
                                   (unaudited)
<TABLE>
<CAPTION>

                                                      THREE MONTHS ENDED JUNE 30,            SIX MONTHS ENDED JUNE 30,
                                                  -----------------------------------   --------------------------------------
                                                        2000               1999               2000                 1999
                                                  -----------------  -----------------   ---------------      ----------------
<S>                                               <C>                <C>                 <C>                  <C>
Revenue:
    Contract research revenue                     $            312   $          3,494    $        3,312       $         7,238
    Licensed research revenue                                    -                400               333                 5,862
                                                  -----------------  -----------------   ---------------      ----------------
                                                               312              3,894             3,645                13,100
Expenses:
    Research and development                                 5,131              8,887            10,192                18,437
    General and administrative                               1,048              1,402             2,154                 2,764
    Restructuring costs                                          -                650                 -                   650
                                                      -------------      -------------   ---------------      ----------------
                                                             6,179             10,939            12,346                21,851
Other revenue:
    Investment income                                          266                353             2,789                   733
    Other income                                                 4                  -               736                     -
                                                  -----------------  -----------------   ---------------      ----------------
Net loss                                                    (5,597)            (6,692)           (5,176)               (8,018)

Accretion of preferred stock                                   (70)               (70)             (140)                 (140)
Dividends on preferred stock                                  (187)              (187)             (373)                 (372)
                                                  -----------------  -----------------   ---------------      ----------------
Net loss applicable to common stockholders        $         (5,854)  $         (6,949)   $       (5,689)      $        (8,530)
                                                  =================  =================   ===============      ================
Net loss per share - basic and diluted            $          (0.21)  $          (0.28)   $        (0.21)      $         (0.35)
                                                  =================  =================   ===============      ================
Weighted average number of shares
  outstanding                                           27,369,429         24,509,546        27,139,937            24,325,112
                                                  =================  =================   ===============      ================
</TABLE>



See accompanying notes.


                                       4
<PAGE>


                         THE IMMUNE RESPONSE CORPORATION

                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                             (amounts in thousands)
                                   (unaudited)
<TABLE>
<CAPTION>
                                                                                            SIX MONTHS ENDED JUNE 30,
                                                                            ----------------------------------------------------
                                                                                     2000                        1999
                                                                            -------------------------   ------------------------
<S>                                                                         <C>                         <C>
Operating activities:
    Net income (loss)                                                       $                 (5,176)   $                (8,018)
    Adjustments to reconcile net income (loss) to net cash provided by
       (used in) operating activities:
           Depreciation and amortization                                                       1,263                        775
           Deferred rent expense                                                                 (59)                       (59)
           Gain on sale of assets                                                               (735)                         -
           Changes in operating assets and liabilities:
               Other current assets                                                             (260)                     1,613
               Accounts payable                                                                  (33)                     2,612
               Accrued expenses                                                               (1,441)                     1,134
               Licensed contracts payable                                                       (465)                         -
                                                                            -------------------------   ------------------------
                    Net cash used in operating activities                                     (6,906)                    (1,943)

Investing activities:
    Sale (purchase) of marketable securities, net                                              3,865                      1,752
    Purchase of property and equipment                                                          (648)                    (2,597)
    Proceeds from sale of land and equipment                                                   2,074                          -
    Deposits and other assets                                                                    156                     (1,707)
                                                                            -------------------------   ------------------------
                    Net cash provided by (used in) investing activities                        5,447                     (2,552)

Financing activities:
    Proceeds from equipment notes payable                                                      1,385                          -
    Principal payments under equipment notes payable                                            (206)                         -
    Net proceeds from sale of common stock                                                     1,667                      3,138
    Net proceeds from exercise of stock options                                                3,717                      1,390
                                                                            -------------------------   ------------------------
                    Net cash provided by financing activities                                  6,563                      4,528
                                                                            -------------------------   ------------------------

Net increase  in cash and cash equivalents                                                     5,104                         33
Cash and cash equivalents at beginning of period                                               4,183                      1,519
                                                                            -------------------------   ------------------------
Cash and cash equivalents at end of period                                  $                  9,287    $                 1,552
                                                                            =========================   ========================
Supplemental disclosure of cash flow information:
    Interest paid                                                           $                    139    $                     -
                                                                            =========================   ========================
Supplemental disclosure of noncash investing and financing activities:
    Unrealized gain (loss) on marketable securities                         $                    907    $                  (154)
                                                                            =========================   ========================
    Settlement of license contract payable with equity                      $                  2,664    $                     -
                                                                            =========================   ========================
    Accretion of convertible preferred stock                                $                    140    $                   140
                                                                            =========================   ========================
    Payment of dividend on convertible preferred stock                      $                    375    $                   374
                                                                            =========================   ========================
    Declared dividend on convertible preferred stock                        $                    187    $                   187
                                                                            =========================   ========================
</TABLE>


See accompanying notes.


                                       5
<PAGE>

                         THE IMMUNE RESPONSE CORPORATION

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

                                  JUNE 30, 2000


1.     BASIS OF PRESENTATION

       The condensed consolidated financial statements of The Immune Response
       Corporation (the "Company") for the three and six-month periods ended
       June 30, 2000 and 1999 are unaudited. These financial statements reflect
       all adjustments, consisting of only normal recurring adjustments which,
       in the opinion of management, are necessary to fairly present the
       consolidated financial position as of June 30, 2000, and the consolidated
       results of operations for the three and six-month periods ended June 30,
       2000 and 1999. The results of operations for the three and six months
       ended June 30, 2000 are not necessarily indicative of the results to be
       expected for the year ended December 31, 2000. For more complete
       financial information, these financial statements, and the notes thereto,
       should be read in conjunction with the consolidated audited financial
       statements for the year ended December 31, 1999 included in the Company's
       Form 10-K filed with the Securities and Exchange Commission.


2.     RECENT ACCOUNTING PRONOUNCEMENT

       In December 1999, the Securities and Exchange Commission issued Staff
       Accounting Bulletin ("SAB") No. 101 - "Revenue Recognition in Financial
       Statements." The bulletin draws on existing accounting rules and provides
       specific guidance on how those accounting rules should be applied and
       specifically addresses revenue recognition for non-refundable technology
       access fees in the biotechnology industry. Adoption of SAB No. 101 is
       required in the fourth quarter of fiscal year 2000. The Company has not
       completed its evaluation of the impact of SAB No. 101 on its financial
       statements. However, the impact is expected to be in a pre-tax range of
       approximately $10 million to $15 million charged to the Company's results
       of operations in the fourth quarter of fiscal year 2000.


3.     NET LOSS PER SHARE

       Net loss per share for the three and six months ended June 30, 2000 and
       1999 is computed using the weighted average number of common shares
       outstanding during the period. Outstanding stock options and warrants are
       not included in the calculation of earnings per share because their
       effect would be antidilutive. Therefore, there is no difference between
       basic and diluted net loss per share.


4.     COMPREHENSIVE INCOME

       The Company accounts for comprehensive income in accordance with the
       Statement of Financial Accounting Standards ("FAS") No. 130, "Reporting
       Comprehensive Income." The components of comprehensive income are as
       follows:
<TABLE>
<CAPTION>
         (in thousands)                        THREE MONTHS ENDED JUNE 30       SIX MONTHS ENDED JUNE 30
                                               --------------------------       ------------------------
                                                   2000        1999               2000           1999
                                               --------      -------            -------        -------
<S>                                            <C>           <C>                <C>            <C>
         Net loss                               $(5,597)     $(6,692)           $(5,176)       $(8,018)
         Net unrealized gain (loss)
           on marketable securities                 584         (113)               907           (154)
                                               --------      -------            -------        -------
         Comprehensive loss                     $(5,013)     $(6,805)           $(4,269)       $(8,172)
                                               ========      =======            =======        =======
</TABLE>


                                       6
<PAGE>

5.     EQUITY TRANSACTION

       In April 1998, the Company sold 200 shares of its Series F Convertible
       Preferred Stock ("Series F Stock") in return for gross proceeds of $10
       million with an initial conversion price of $14.07 per share of common
       stock. The conversion price has since been adjusted downward to $4.17 per
       share of common stock. The conversion price may be further adjusted
       downward if the Company's common stock does not trade at prices higher
       than the conversion price over a period of time. The Series F Stock bears
       a dividend of 7.5% per annum. In general, the dividend is payable in
       shares of common stock or cash at the Company's option. For the six
       months ended June 30, 2000 and 1999, 64,901 and 27,982 shares,
       respectively, of the Company's common stock were issued as dividends to
       the Series F shareholders. The Company has filed a registration statement
       with the Securities and Exchange Commission covering the resale of the
       common stock issuable upon conversion of the Series F Stock.


6.     COLLABORATION WITH AGOURON PHARMACEUTICALS, INC.

       During June 1998, the Company and Agouron Pharmaceuticals, Inc.
       ("Agouron"), a wholly-owned subsidiary of Pfizer Inc., entered into a
       binding agreement under which the Company agreed to exclusively license
       to Agouron certain rights relating to REMUNE(TM), its immune-based
       therapy under development for the treatment of HIV infection. Under the
       terms of the agreement, the Company will exclusively manufacture
       commercial supplies of REMUNE; and Agouron will have exclusive rights to
       market REMUNE in North America, Europe, Japan and certain other
       countries, if regulatory approvals are received. As a result of this
       agreement, the Company may potentially receive in the aggregate up to $77
       million, including license and milestone payments of $45 million,
       payments to support research and development of $18 million and $14
       million for the purchase of the Company's common stock, priced at a
       premium to the market, subject to certain rights of termination by
       Agouron. In addition, the two companies will share all profits from the
       commercialization of REMUNE on a 50/50 basis, if REMUNE is successfully
       developed and receives the necessary regulatory approvals.

       As of June 30, 2000, the Company had received a total of $47 million from
       Agouron under the agreement. Agouron will make additional payments upon
       achievement of certain milestones. In January 2000, the Company received
       a $5 million payment from Agouron consisting of $3 million for research
       and development and $2 million for the purchase of 266,667 shares of
       unregistered common stock priced at a premium to the market price. This
       was the final payment in a series of six quarterly payments made by
       Agouron to fund research and development and to purchase unregistered
       common stock under the June 1998 agreement. In April 1999 and January
       1999, the Company received a $5 million payment in each month from
       Agouron consisting of a $3 million payment for research and development
       and a $2 million payment for the purchase of 189,350 and 149,911 shares
       of unregistered common stock, respectively, priced at a premium to the
       market. Also in conjunction with this agreement, the Company received a
       $5 million milestone payment in February 1999.



7.     SUBSEQUENT EVENT
       On August 8, 2000, the Company announced a public offering of 2,400,000
       shares of its common stock at a price of $6.00 per share. The
       underwriters have been granted an over-allotment option to purchase up to
       an additional 360,000 shares.


                                       7
<PAGE>

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

SUMMARY
The Immune Response Corporation is a biopharmaceutical company developing
immune-based therapies to induce specific immune responses for the treatment of
HIV, autoimmune diseases and cancer. In addition, we are developing a targeted
non-viral delivery technology for gene therapy, which is designed to enable the
delivery of genes directly to the liver via intravenous injection.

This discussion contains forward-looking statements concerning our operating
results and timing of anticipated revenues and expenditures. Such statements are
subject to risks and uncertainties that could cause actual results to differ
materially from those projected. Factors that could cause or contribute to such
differences include those discussed under "Risk Factors." The following should
be read in conjunction with the Condensed Consolidated Financial Statements and
Notes thereto included elsewhere in this Form 10-Q. These forward-looking
statements speak only as of the date hereof. We undertake no obligation to
publicly release the result of any revisions to these forward-looking statements
that may be made to reflect events or circumstances after the date hereof or to
reflect the occurrence of unanticipated events.

In January 2000, we received a $5.0 million payment from Agouron
Pharmaceuticals, Inc. ("Agouron"), a wholly-owned subsidiary of Pfizer Inc.,
consisting of a $3.0 million payment for research and development and a $2.0
million payment for the purchase of 266,667 shares of unregistered common stock
priced at a premium to the market. This was the final payment in a series of six
quarterly payments made by Agouron to fund research and development and to
purchase unregistered common stock under the June 1998 agreement.

In March 2000, we sold 4.65 acres of undeveloped property adjacent to our
headquarters facility in Carlsbad, California for approximately $2.0 million.
Also in March 2000, we sold for cash approximately $2.3 million of an equity
security held for sale that was acquired through the licensing of technology.

In May 2000, we utilized the remaining $1.4 million of available credit under a
$3.0 million equipment line of credit as reimbursement for capital expenditures
during the past seven months.

In August 2000, we announced a public offering of 2,400,000 shares of common
stock at a price of $6.00 per share. The underwriters have been granted an
over-allotment option to purchase up to an additional 360,000 shares.

We have not been profitable since inception and had an accumulated deficit of
$191.7 million as of June 30, 2000. To date, we have not recorded any revenues
from the sale of products. Revenues recorded through June 30, 2000 were
primarily received from contract research, licensing of technology, milestone
achievement payments and investment income. We expect our operating losses to
continue, as well as to have quarter-to-quarter fluctuations, some of which
could be significant, due to research, development and clinical trial
activities. There can be no assurance that we will be able to generate
sufficient product revenue to become profitable at all or on a sustained basis.

In December 1999, the Securities and Exchange Commission issued a Staff
Accounting Bulletin regarding revenue recognition in financial statements for
non-refundable technology access fees in the biotechnology industry, which will
impact the Company's financial statements during the fourth quarter of 2000. See
Note 2 to the Condensed Consolidated Financial Statements.

RESULTS OF OPERATIONS
Revenues for the three and six months ended June 30, 2000 were $312,000 and
$3.6 million, respectively, as compared to $3.9 million and $13.1 million for
the same periods in 1999. The decrease in revenue in 2000 was primarily
attributed to the receipt of only one quarterly research and development
payment in 2000 of approximately $3.0 million from Agouron versus two
quarterly payments in 1999 of approximately $3.0 million each. In addition,
we received in 1999 a one-time $5.0 million milestone payment from Agouron
and a $1.0 million research collaboration payment from Schering Corporation
(Schering). We received the final quarterly payment under the agreement with
Agouron in January 2000, and Schering's obligation to fund under their
collaboration with us expired on December 31, 1999. As a result, we expect no
additional revenues unless it is earned through existing corporate
collaborations or new research and development agreements, if any. We have
not received any revenues from the commercial sale of products and do not
expect to derive revenue from the sale of products for the foreseeable future.

                                       8
<PAGE>

Research and development expenditures for the three and six months ended June
30, 2000 of $5.1 million and $10.2 million, respectively, decreased from $8.9
million and $18.4 million during the same periods in 1999. The decrease in
research and development spending from 1999 to 2000 was due primarily to
reduced clinical and regulatory costs. Reduced costs associated with the
autoimmune, gene therapy and cancer programs as a result of our workforce
reduction in 1999 also contributed to this decreased spending. With the
current U.S. pivotal HIV clinical study being conducted and paid for by
Agouron, future clinical study spending is expected to remain consistent with
this quarter unless new clinical studies are initiated in our other
development programs. However, spending associated with our scale-up of the
manufacturing process for REMUNE and the cost of producing clinical supplies
for ongoing and future REMUNE studies could increase in the foreseeable
future. Future research and development expenditures are expected to remain
somewhat level with the current quarter, but quarter to quarter fluctuations
may occur due to the timing of expenditures. If additional collaborations are
entered into, research and development expenditures would increase over
current levels.

General and administrative expenses for the three and six months ended June
30, 2000 were $1.1 million and $2.1 million, respectively, as compared to
$1.4 million and $2.8 million for the same periods in 1999. This decrease in
spending was primarily attributed to our workforce reduction in 1999 and
somewhat lower professional fees for the current six months. Quarterly
general and administrative expenses for the remainder of 2000 are expected to
remain consistent with first and second quarter levels.

Investment income increased to $2.8 million for the six months ended June 30,
2000 from $733,000 during the same period in 1999. The increase in investment
income in 2000 compared to 1999 was due primarily to the sale  in the first
quarter of 2000 of approximately $2.3 million of an equity security held for
sale, offset by somewhat lower interest income during 2000. Lower interest
income is due to lower cash balances overall in interest bearing investments
for the six months ended in 2000 as compared to the same period in 1999.
Investment income for the three months ended June 30, 2000 was $266,000 as
compared to $353,000 for the same period of 1999.

Other income of $736,000 for the six months ended June 30, 2000 was primarily
attributable to the gain recognized from the sale  in the first quarter of
2000 of undeveloped property adjacent to our headquarters facility in
Carlsbad, California resulting in approximately $2.0 million gross proceeds.

LIQUIDITY AND CAPITAL RESOURCES
Since our inception through June 30, 2000, we have financed our activities
primarily from public and private sales of equity, funding from
collaborations with corporate partners and investment income. At June 30,
2000, we had working capital of $21.5 million and $25.2 million of cash, cash
equivalents and marketable securities. This compares with working capital of
$14.7 million and $23.1 million of cash, cash equivalents and marketable
securities as of December 31, 1999. Working capital increased as a result of
the lower cost of operations, in particular the reduced cost of the REMUNE
HIV clinical trials, clinical trial materials and manufacturing supplies, and
the sale of $2.3 million of an equity security held for sale and $2.0 million
of undeveloped property. During May 2000, we utilized all of the remaining
$1.4 million of available credit under a $3.0 million equipment line of
credit entered into during 1999.

We will need to raise additional funds to conduct research and development,
preclinical studies and clinical trials necessary to bring potential products
to market and to establish manufacturing and marketing capabilities. We
anticipate that for the foreseeable future, the scale-up of the manufacturing
process for REMUNE and the cost of producing clinical supplies for ongoing
and future REMUNE studies will continue to represent a significant portion of
our overall expenditures. We also anticipate that costs related to the
clinical trials of REMUNE will decrease from 1999 levels, as the current U.S.
pivotal study and any future pivotal studies are expected to be conducted by
Agouron. Overall, future research and development expenditures are expected
to remain somewhat constant to current levels. However, future spending for
research and development may increase if we enter into additional
collaborations. We anticipate additional capital improvements of
approximately $3.0 million for 2000 related to the scale-up of the
manufacturing process, some of which we anticipate will be funded with debt
financing. Other anticipated costs with respect to REMUNE, including
investment in inventory, will depend on many factors including the results of
clinical trials, the continuation of our collaboration with Agouron and other
factors which will influence our determination of the appropriate continued
investment of our financial resources in this program.

                                       9
<PAGE>

Our future capital requirements will depend on many factors, including
continued scientific progress in our research and development programs, the
scope and results of preclinical studies and clinical trials, the time and
costs involved in obtaining regulatory approvals, the costs involved in
filing, prosecuting and enforcing patent claims, competing technological and
market developments, the cost of manufacturing scale-up and inventories,
effective commercialization activities and arrangements and other factors not
within our control. We intend to seek additional funding through additional
research and development agreements with suitable corporate collaborators,
extensions of existing corporate collaborations and through public or private
financings, if available. However, there can be no assurance that such
collaboration arrangements or any public or private financings will be
available on acceptable terms, if at all. If funds are raised through equity
arrangements, further dilution to stockholders may result. If adequate funds
are not available, we may be required to delay, reduce the scope of or
eliminate one or more of our research or development programs or take other
measures to cut costs, which could have a material adverse effect on us. We
estimate that our existing capital resources, together with the proceeds from
the public offering completed in August 2000 will be sufficient to fund our
current and planned operations through 2001. There can be no assurance,
however, that changes in our research and development plans or other changes
affecting our operating expenses may result in the expenditure of such
resources before that time. In any event, we will need to raise substantial
additional capital to fund our operations in future periods.

RISK FACTORS

OUR FAILURE TO DEVELOP AND COMMERCIALIZE PRODUCTS SUCCESSFULLY MAY CAUSE US TO
CEASE OPERATIONS

We have not completed the development of any products. Our failure to develop
and commercialize products successfully may cause us to cease operations. Our
potential therapies under development will require significant additional
research and development efforts and regulatory approvals prior to potential
commercialization.

The discontinuation of a previous Phase 3 trial of REMUNE IN MAY 1999 due to
lack of efficacy has had a material adverse effect on us. If Agouron does not
successfully complete the current pivotal trial of REMUNE, we may have to
abandon REMUNE or seek additional funding.

Our other therapies and technologies are at earlier stages of development than
REMUNE and may not be shown to be safe or efficacious or ever receive regulatory
approval. Some of our technologies have not yet been tested in humans. Human
testing of potential products based on these technologies may not be permitted
by regulatory authorities. Even if human testing is permitted, the products
based on these technologies may not be successfully developed or be shown to be
safe and efficacious.

The results of our preclinical studies and clinical trials may not be indicative
of future clinical trial results. A commitment of substantial resources to
conduct time-consuming research, preclinical studies and clinical trials will be
required if we are to develop any products. Delays in planned patient enrollment
in our clinical trials may result in increased costs, program delays or both.
None of our potential products may prove to be safe and effective in clinical
trials. Food and Drug Administration ("FDA") or other regulatory approvals may
not be obtained and even if successfully developed and approved, our products
may not achieve market acceptance. Any products resulting from our programs are
not expected to be successfully developed or commercially available for a number
of years, if at all.

Unacceptable toxicities or side effects may occur at any time in the course of
human clinical trials or, if any products are successfully developed and
approved for marketing, during commercial use of our products. The appearance of
any unacceptable toxicities or side effects could interrupt, limit, delay or
abort the development of any of our products or, if previously approved,
necessitate their withdrawal from the market.

OUR ADDITIONAL FINANCING REQUIREMENTS AND LIMITED ACCESS TO FINANCING MAY
ADVERSELY AFFECT OUR ABILITY TO DEVELOP PRODUCTS

We will need to raise additional funds to conduct research and development,
preclinical studies and clinical trials necessary to bring our potential
products to market and establish manufacturing and marketing capabilities. A
failure to raise additional funds would require us to scale back or eliminate
some or all of our research and development programs or license to third parties
products or technologies that we would otherwise seek to


                                       10
<PAGE>

develop ourselves. We estimate that our existing capital resources, together
with the proceeds from the public offering completed in August 2000 will be
sufficient to fund our current and planned operations through 2001.

Although we anticipate that development of REMUNE will continue to represent a
significant portion of our overall expenditures, we also anticipate that costs
related to the development of REMUNE will decrease in 2000. Other anticipated
costs with respect to REMUNE will depend on many factors, in particular the
continuation of our collaboration with Agouron.

Our future capital requirements will depend on many factors, including:

-   continued scientific progress in our research and development programs;

-   the scope and results of preclinical studies and clinical trials;

-   the time and costs involved in obtaining regulatory approvals;

-   the costs involved in filing, prosecuting and enforcing patent claims;

-   competing technological and market developments;

-   the cost of manufacturing scale-up;

-   effective commercialization activities and arrangements; and

-   other factors not within our control.

IF AGOURON TERMINATES ITS COLLABORATION WITH US WE MAY HAVE TO ABANDON REMUNE

According to its terms, our binding letter of intent with Agouron may be
terminated at will and at any time by Agouron. The termination of our agreement
with Agouron might require us to abandon REMUNE. Agouron has been acquired by
Pfizer Inc. We do not know which Agouron research products, if any, Pfizer Inc.
will continue to fund in the future.

WE MAY BE UNABLE TO ENTER INTO ADDITIONAL COLLABORATIONS OR MAINTAIN EXISTING
ONES

We intend to seek additional collaborative arrangements to develop and
commercialize our products. We may not be able to negotiate collaborative
arrangements on favorable terms, or at all, in the future and our current or
future collaborative arrangements may not be successful or continue. Under the
Schering collaboration, Schering's obligation to fund expired on December 31,
1999. Without funding arrangements, we may have to abandon some of our products
under development.

OUR PATENTS AND PROPRIETARY TECHNOLOGY MAY NOT PROVIDE US WITH ANY BENEFIT AND
THE PATENTS AND PROPRIETARY TECHNOLOGY OF OTHERS MAY PREVENT US FROM
COMMERCIALIZING PRODUCTS

A failure to obtain meaningful patent protection for our potential products and
processes would greatly diminish the value of our potential products and
processes.

In addition, whether or not our patents are issued, or issued with limited
coverage, others may receive patents which contain claims applicable to our
products. We are aware that AstraZeneca PLC has acquired the rights to a patent,
which has been issued in Europe and other countries, that may interfere with our
ability to develop some of our technologies related to autoimmune disease if the
patent is upheld after current opposition proceedings. This patent, and others
that we are not aware of, may adversely affect our ability to develop and
commercialize products.

The patent positions of biotechnology and pharmaceutical companies can be highly
uncertain, and involve complex legal and factual questions. Therefore, the
breadth of claims allowed in biotechnology and


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<PAGE>

pharmaceutical patents cannot be predicted. We also rely upon unpatented trade
secrets and know how, and others may independently develop substantially
equivalent trade secrets or know how.

We also rely on protecting our proprietary technology in part through
confidentiality agreements with our corporate collaborators, employees,
consultants and certain contractors. These agreements may be breached and we may
not have adequate remedies for any breach. In addition, our trade secrets may
otherwise become known or independently discovered by our competitors.

Our products and processes may infringe, or be found to infringe, patents not
owned or controlled by us, such as the patent owned by AstraZeneca PLC. If
relevant claims of third-party patents are upheld as valid and enforceable, we
could be prevented from practicing the subject matter claimed in the patents, or
would be required to obtain licenses or redesign our products or processes to
avoid infringement. Licenses may not be available at all or on commercially
reasonable terms, and we may not be able to redesign our products or processes
to avoid infringement.

Litigation may be necessary to defend against claims of infringement, to enforce
our patents or to protect trade secrets. Litigation could result in substantial
costs and diversion of management efforts regardless of the results of the
litigation. An adverse result in litigation could subject us to significant
liabilities to third parties, require disputed rights to be licensed or require
us to cease using certain technologies.

OUR HISTORY OF OPERATING LOSSES AND OUR EXPECTATIONS OF CONTINUING LOSSES MAY
HURT OUR ABILITY TO CONTINUE OPERATIONS

As of June 30, 2000 we had a consolidated accumulated deficit of $191.7 million.
We have not generated revenues from the commercialization of any product. We
expect to incur substantial net operating losses over the next several years,
which may imperil our ability to continue operations. We may not be able to
generate sufficient product revenue to become profitable on a sustained basis,
or at all.

THE LENGTHY PRODUCT APPROVAL PROCESS AND UNCERTAINTY OF GOVERNMENT REGULATORY
REQUIREMENTS MAY DELAY OR PREVENT US FROM COMMERCIALIZING PRODUCTS

Clinical testing, manufacture, promotion and sale of our products are subject to
extensive regulation by numerous governmental authorities in the United States,
principally the FDA, and corresponding state and foreign regulatory agencies.
This regulation may delay or prevent us from commercializing products.
Noncompliance with applicable requirements can result in, among other things,
fines, injunctions, seizure of products, total or partial suspension of product
marketing, failure of the government to grant premarket approval, withdrawal of
marketing approvals and criminal prosecution.

The regulatory process for new therapeutic drug products, including the required
preclinical studies and clinical testing, is lengthy and expensive. We may not
receive necessary FDA clearances for any of our potential products in a timely
manner, or at all. The length of the clinical trial process and the number of
patients the FDA will require to be enrolled in the clinical trials in order to
establish the safety and efficacy of our products is uncertain.

Even if additional clinical trials of REMUNE are successfully completed, the FDA
may not approve REMUNE for commercial sale. We may encounter significant delays
or excessive costs in our efforts to secure necessary approvals. Regulatory
requirements are evolving and uncertain. Future United States or foreign
legislative or administrative acts could also prevent or delay regulatory
approval of our products. We may not be able to obtain the necessary approvals
for clinical trials, manufacturing or marketing of any of our products under
development. Even if commercial regulatory approvals are obtained, they may
include significant limitations on the indicated uses for which a product may be
marketed.

In addition, a marketed product is subject to continual FDA review. Later
discovery of previously unknown problems or failure to comply with the
applicable regulatory requirements may result in restrictions on the marketing
of a product or withdrawal of the product from the market, as well as possible
civil or criminal sanctions.

Among the other requirements for regulatory approval is the requirement that
prospective manufacturers conform to the FDA's Good Manufacturing Practices, or
GMP. In complying with the FDA's GMP requirements, manufacturers must continue
to expend time, money and effort in production, recordkeeping and quality
control to


                                       12
<PAGE>

assure products meet applicable specifications and other requirements. Failure
to comply with the FDA's GMP requirements subjects manufacturers to possible FDA
regulatory action. We or our contract manufacturers, if any, may not be able to
maintain compliance with the FDA's GMP requirements on a continuing basis.
Failure to maintain compliance could have a material adverse effect on us.

The FDA has not designated expanded access protocols for REMUNE as "treatment"
protocols. The FDA may not determine that REMUNE meets all of the FDA's criteria
for use of an investigational drug for treatment use. Even if REMUNE is allowed
for treatment use, third party payers may not provide reimbursement for the
costs of treatment with REMUNE.

The FDA may not consider REMUNE or any other of our products under development
to be an appropriate candidate for accelerated approval, expedited review or
fast track designation.

Marketing any drug products outside of the United States, will subject us to
numerous and varying foreign regulatory requirements, governing the design and
conduct of human clinical trials and marketing approval. Approval procedures
vary among countries and can involve additional testing, and the time required
to obtain approval may differ from that required to obtain FDA approval. Foreign
regulatory approval processes include all of the risks associated with obtaining
FDA approval set forth above, and approval by the FDA does not ensure approval
by the health authorities of any other country.

TECHNOLOGICAL CHANGE AND COMPETITION MAY RENDER OUR POTENTIAL PRODUCTS OBSOLETE

The biotechnology industry continues to undergo rapid change and competition is
intense and is expected to increase. Competitors may succeed in developing
technologies and products that are more effective or affordable than any that we
are developing o that would render our technology and products obsolete and
noncompetitive. Many of our competitors have substantially greater experience,
financial and technical resources and production, marketing and development
capabilities than us. Accordingly, some of our competitors may succeed in
obtaining regulatory approval for products more rapidly or effectively than us.

OUR LACK OF COMMERCIAL MANUFACTURING AND MARKETING EXPERIENCE MAY PREVENT US
FROM SUCCESSFULLY COMMERCIALIZING PRODUCTS

We have not manufactured any of our product candidates in commercial quantities.
We may not successfully make the transition from manufacturing clinical trial
quantities to commercial production quantities or be able to arrange for
contract manufacturing and this could prevent us from commercializing products.
Even if REMUNE is successfully developed and receives FDA approval, we have not
demonstrated the capability to manufacture REMUNE in commercial quantities.
Except for REMUNE, we have not demonstrated the ability to manufacture our
treatments in large-scale clinical quantities either. We rely on a third party
for the final inactivation step of the REMUNE manufacturing process. If the
existing manufacturing operations prove inadequate, there can be no assurance
that any arrangement with a third party can be established on a timely basis, or
that we can establish other manufacturing capacity on a timely basis.

We have no experience in the sales, marketing and distribution of pharmaceutical
products. Thus, our products may not be successfully commercialized even if they
are developed and approved for commercialization.

The manufacturing process of our products involves a number of steps and
requires compliance with stringent quality control specifications imposed by us
and by the FDA. Moreover, our products can only be manufactured in a facility
that has undergone a satisfactory inspection by the FDA. For these reasons, we
would not be able quickly to replace our manufacturing capacity if we were
unable to use our manufacturing facilities as a result of a fire, natural
disaster (including an earthquake), equipment failure or other difficulty, or if
such facilities are deemed not in compliance with the FDA's GMP requirements and
the non-compliance could not be rapidly rectified. Our inability or reduced
capacity to manufacture our products would prevent us from successfully
commercializing products.

We may enter into arrangements with contract manufacturing companies to expand
our own production capacity in order to meet requirements for our products, or
to attempt to improve manufacturing efficiency. If we choose to contract for
manufacturing services and encounter delays or difficulties in establishing
relationships with manufacturers to produce, package and distribute our finished
products, clinical trials, market introduction and subsequent sales of the
products would be delayed. Further, contract manufacturers must also operate in


                                       13
<PAGE>

compliance with the FDA's GMP requirements; failure to do so could result in,
among other things, the disruption of product supplies. Our potential dependence
upon third parties for the manufacture of our products may adversely affect our
profit margins and our ability to develop and deliver products on a timely and
competitive basis.

ADVERSE DETERMINATIONS CONCERNING PRODUCT PRICING, REIMBURSEMENT AND RELATED
MATTERS COULD PREVENT US FROM SUCCESSFULLY COMMERCIALIZING PRODUCTS

Our ability to earn sufficient returns on our products will depend in part on
the extent to which reimbursement for the costs of the products and related
treatments will be available from government health administration authorities,
private health coverage insurers, managed care organizations and other
organizations. Failure to obtain appropriate reimbursement could prevent us from
successfully commercializing products. Third party payors are increasingly
challenging the price of medical products and services. If purchasers or users
of our products are not able to obtain adequate reimbursement for the cost of
using the products, they may forego or reduce their use. Significant uncertainty
exists as to the reimbursement status of newly approved health care products,
and whether adequate third party coverage will be available.

PRODUCT LIABILITY EXPOSURE MAY EXPOSE US TO SIGNIFICANT LIABILITY

We face an inherent business risk of exposure to product liability and other
claims in the event that the development or use of our technology or prospective
products is alleged to have resulted in adverse effects. We may not avoid
significant liability exposure. We may not have sufficient insurance coverage,
and we may not be able to obtain sufficient coverage at a reasonable cost. An
inability to obtain product liability insurance at acceptable cost or to
otherwise protect against potential product liability claims could prevent or
inhibit the commercialization of our products. A product liability claim could
hurt our financial performance. Even if we avoid liability exposure, significant
costs could be incurred that could hurt our financial performance.

HAZARDOUS MATERIALS AND ENVIRONMENTAL MATTERS COULD EXPOSE US TO SIGNIFICANT
COSTS

Although we do not currently manufacture commercial quantities of our product
candidates, we produce limited quantities of these products for our clinical
trials. We may be required to incur significant costs to comply with current or
future environmental laws and regulations. Our research and development
processes involve the controlled storage, use and disposal of hazardous
materials, biological hazardous materials and radioactive compounds. We are
subject to federal, state and local laws and regulations governing the use,
manufacture, storage, handling and disposal of these materials and some waste
products. Although we believe that our safety procedures for handling and
disposing of these materials comply with the standards prescribed by these laws
and regulations, the risk of accidental contamination or injury from these
materials cannot be completely eliminated. In the event of an accident, we could
be held liable for any damages that result, and any liability could exceed our
resources. Our operations, business or assets may be materially and adversely
affected by current or future environmental laws or regulations.

SUBORDINATION OF COMMON STOCK TO PREFERRED STOCK COULD HURT COMMON STOCKHOLDERS

Our common stock is expressly subordinate to our Series F Convertible Preferred
Stock in the event of our liquidation, dissolution or winding up. If we were to
cease operations and liquidate our assets, there may not be any remaining value
available for distribution to the holders of common stock after providing for
the Series F Convertible Preferred Stock liquidation preference.

YOU COULD SUFFER SUBSTANTIAL DILUTION OF YOUR INVESTMENT IF OUR PREFERRED STOCK
IS CONVERTED INTO COMMON STOCK OR CERTAIN RIGHTS TO PURCHASE COMMON STOCK ARE
EXERCISED

In 1998 we sold 200 shares of Series F Convertible Preferred Stock, or Series F
Stock, in return for gross proceeds of $10 million. These shares of Series F
Stock are currently convertible into at least 2.4 million shares of our common
stock, which number is subject to increase if our common stock does not meet
certain specified price trading levels. Additionally, on April 24, 2001 we will
be required to redeem the Series F Stock in either cash or in shares of our
common stock. Further, as of June 30, 2000 we had reserved 6.3 million shares of
our common stock for potential issuances upon the exercise of stock options and
warrants and payment of dividends on the Series F Stock. Issuance of any of
these additional shares could substantially dilute your interest in our company.

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<PAGE>

VOLATILITY OF STOCK PRICE AND ABSENCE OF DIVIDENDS MAY HURT COMMON STOCKHOLDERS

The market price of our common stock, like that of the common stock of many
other biopharmaceutical companies, has been and is likely to be highly volatile.
Factors such as the following could have a significant adverse impact on the
market price of our common stock:

-  the results of preclinical studies and clinical trials by us, our
   collaborators or our competitors;

-  concern as to, or other evidence of, the safety or efficacy of our products
   or our competitors products;

-  announcements of technological innovations or new products by us or our
   competitors;

-  governmental regulatory actions;

-  actual or anticipated changes in drug reimbursement policies;

-  developments with our collaborators;

-  developments concerning patent or other proprietary rights of ours or our
   competitors (including litigation);

-  period-to-period fluctuations in our operating results;

-  changes in estimates of our performance by securities analysts;

-  market conditions for biopharmaceutical stocks in general; and

-  other factors not within our control

We have never paid cash dividends on our common stock and do not anticipate
paying any cash dividends in the foreseeable future.

CHANGES TO FINANCIAL ACCOUNTING STANDARDS MAY AFFECT OUR REPORTED RESULTS OF
OPERATIONS

We prepare our financial statements to conform with generally accepted
accounting principles, or GAAP. GAAP are subject to interpretation by the
American Institute of Public Accountants, the Securities and Exchange Commission
and various bodies formed to interpret and create appropriate accounting
policies. A change in those policies can have a significant effect on our
reported results and may even affect our reporting of transactions completed
before a change is announced. Accounting policies affecting many other aspects
of our business, including rules relating to purchase and pooling-of-interests
accounting for business combinations, employee stock option grants and revenue
recognition have recently been revised or are under review. Changes to those
rules or the questioning of current practices may adversely affect our reported
financial results or the way we conduct our business. In addition, our
preparation of financial statements in accordance with GAAP requires that we
make estimates and assumptions that affect the recorded amounts of assets and
liabilities, disclosure of those assets and liabilities and at the date of the
financial statements and the recorded amounts of expenses during the reporting
period. A change in the facts and circumstances surrounding those estimates
could result in a change to our estimates and could impact our future operating
results.

OUR CERTIFICATE OF INCORPORATION AND BYLAWS INCLUDE PROVISIONS THAT COULD
DISCOURAGE POTENTIAL TAKEOVER ATTEMPTS AND MAKE ATTEMPTS BY STOCKHOLDERS TO
CHANGE MANAGEMENT MORE DIFFICULT

The approval of 66 2/3 percent of our voting stock is required to approve
certain transactions and to take certain stockholder actions, including the
calling of special meetings of stockholders and the amendment of any of the
anti-takeover provisions, such as those providing for a classified board of
directors, contained in our certificate of incorporation. Further, pursuant to
the terms of our stockholder rights plan, we have distributed a dividend of one
right for each outstanding share of common stock. These rights will cause
substantial dilution to the ownership of a person or group that attempts to
acquire us on terms not approved by our Board of Directors and may have the
effect of deterring hostile takeover attempts. The practical effect of these
provisions is to require a party seeking


                                       15
<PAGE>

control of our company to negotiate with our Board of Directors, which could
delay or prevent a change in control. These provisions could limit the price
that investors might be willing to pay in the future for our common stock.

We are subject to the anti-takeover provisions of Section 203 of the Delaware
General Corporation Law, which prohibits us from engaging in a "business
combination" with an "interested stockholder" for a period of three years after
the date of the transaction in which the person first becomes an "interested
stockholder," unless the business combination is approved in a prescribed
manner. The application of Section 203 also could have the effect of delaying or
preventing a change in control.


                                       16
<PAGE>

ITEM 3.      QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We invest our excess cash primarily in U.S. government securities and money
market accounts. These instruments have maturities of two years or less when
acquired. We do not utilize derivative financial instruments, derivative
commodity instruments or other market risk sensitive instruments, positions or
transactions. Accordingly, we believe that, while the instruments we hold are
subject to changes in the financial standing of the issuer of such securities,
we are not subject to any material risks arising from changes in interest rates,
foreign currency exchange rates, commodity prices, equity prices or other market
changes that affect market risk sensitive instruments.


                                       17
<PAGE>

PART II.  OTHER INFORMATION

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

On May 25, 2000 the Company held its Annual Meeting of Stockholders. The
following actions were taken at the annual meeting. As of April 5, 2000, the
record date, 27,354,037 shares were entitled to vote at the Annual Meeting.

1.    The following Class II Directors were elected:

      a.   Melvin Perelman 24,229,196 shares voted in favor of the nominee,
           159,028 shares withheld their vote;

      b.   William M. Sullivan 24,235,000 shares voted in favor of the nominee,
           153,224 shares withheld their vote;

      e. The following directors continue in office for their existing terms:

           Dennis J. Carlo
           James Glavin
           Kevin B. Kimberlin
           Philip M. Young

2.    The selection of Arthur Andersen LLP as the Company's independent auditor
      was ratified. 24,289,589 shares were voted in favor of the proposal,
      61,393 shares were voted against the proposal and 37,242 shares abstained.


ITEM 6.   EXHIBITS AND REPORTS ON FORM 8-K

a)   Exhibits

     10.74 Lease dated May 22, 2000 by and among the Company and Brandywine
           Operating Partnership, L.P.

     27    Financial Data Schedule

b)   Reports on Form 8-K

     None


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<PAGE>

                                    SIGNATURE


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.



                                     THE IMMUNE RESPONSE CORPORATION






Date:  August  14, 2000              /s/HOWARD SAMPSON
                                     ------------------------------------------
                                     Howard Sampson
                                     Vice President, Finance
                                     Chief Financial Officer
                                     Secretary and Treasurer

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