<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 MARCH 31, 1999
                               ----------------

/  /   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
 Incorporation or Organization)                         Identification Number)


                      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 May 4, 1999, 24,513,357 shares of common stock were outstanding.




<PAGE>

                         THE IMMUNE RESPONSE CORPORATION

                                    FORM 10-Q

                                QUARTERLY REPORT


                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                         PART I - FINANCIAL INFORMATION

                                                                           PAGE
<S>                                                                       <C>

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

                           PART II - OTHER INFORMATION

Signature                                                                   19
</TABLE>



                                      2

<PAGE>

PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS

                         THE IMMUNE RESPONSE CORPORATION

                      CONDENSED CONSOLIDATED BALANCE SHEETS
                        (in thousands, except share data)

<TABLE>
<CAPTION>
                                                                             March 31,
                                                                                1999              December 31,
                                                                            (unaudited)                1998
                                                                        -------------------    --------------------
<S>                                                                      <C>                    <C>

Assets
Current assets:
    Cash and cash equivalents                                           $              418     $             1,519
    Marketable securities-available-for-sale                                        27,008                  23,343
    Other current assets                                                               320                   1,983
                                                                        -------------------    --------------------

            Total current assets                                                    27,746                  26,845

Property and equipment, net                                                          9,050                   7,825
Deposits and other assets                                                            2,126                     956
                                                                        -------------------    --------------------

                                                                        $           38,922     $            35,626
                                                                        -------------------    --------------------
                                                                        -------------------    --------------------


Liabilities and stockholders' equity Current liabilities:
    Accounts payable                                                    $            4,164     $             2,755
    Other accrued expenses                                                           2,038                   1,464
                                                                        -------------------    --------------------

            Total current liabilities                                                6,202                   4,219

Convertible preferred stock                                                          9,417                   9,347

Stockholders' equity:
    Preferred stock, 5,000,000 shares authorized; none issued                          ---                     ---
    Common stock, $.0025 par value, 40,000,000 shares authorized,
       24,513,357 and 23,795,292 shares issued and outstanding
       at March 31, 1999 and December 31, 1998, respectively                            61                      59
    Warrants                                                                         2,144                   2,144
    Additional paid-in capital                                                     193,926                 191,317
    Unrealized gain on marketable securities                                            61                     102
    Accumulated deficit                                                           (172,889)               (171,562)
                                                                        -------------------    --------------------

            Total stockholders' equity                                              23,303                  22,060
                                                                        -------------------    --------------------

                                                                        $           38,922     $            35,626
                                                                        -------------------    --------------------
                                                                        -------------------    --------------------
</TABLE>

See accompanying notes.

                                      3
<PAGE>

                         THE IMMUNE RESPONSE CORPORATION

                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                      (in thousands, except per share data)
                                   (unaudited)

<TABLE>
<CAPTION>
                                                                              Three months ended March 31,
                                                                         ---------------------------------------
                                                                                 1999                  1998
                                                                         -----------------     -----------------
<S>                                                                      <C>                   <C>
Revenues:
    Contract research revenue                                            $          9,206      $          1,000

Expenses:
    Research and development                                                        9,550                 8,261
    General and administrative                                                      1,363                   999
                                                                         -----------------     -----------------

                                                                                   10,913                 9,260
Other revenue and expense:
    Investment income                                                                 380                   311
                                                                         -----------------     -----------------

Net loss                                                                 $         (1,327)     $         (7,949)
                                                                         -----------------     -----------------
                                                                         -----------------     -----------------
 
Net loss per share - basic and diluted                                   $          (0.05)     $          (0.35)
                                                                         -----------------     -----------------
                                                                         -----------------     -----------------

Weighted average number of shares
    outstanding                                                                    24,138                22,824
                                                                         -----------------     -----------------
                                                                         -----------------     -----------------
</TABLE>

See accompanying notes.

                                      4

<PAGE>

                         THE IMMUNE RESPONSE CORPORATION

                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (in thousands)
                                   (unaudited)

<TABLE>
<CAPTION>
                                                                               Three months ended March 31,
                                                                          ---------------------------------------
                                                                                 1999                  1998
                                                                          ------------------    -----------------
<S>                                                                       <C>                   <C>
Operating activities:
    Net loss                                                              $          (1,327)    $         (7,949)
    Adjustments to reconcile net loss to net cash used by
       operating activities:
           Depreciation and amortization                                                389                  371
           Deferred rent expense                                                        (30)                 (22)
           Changes in operating assets and liabilities:
               Other current assets                                                   1,662                  287
               Accounts payable                                                       1,409                1,016
               Other accrued expenses                                                   604                  (44)
                                                                          ------------------    -----------------

                    Net cash used in operating activities                             2,707               (6,341)

Investing activities:
    Sale (purchase) of marketable securities, net                                    (1,983)               4,645
    Purchase of property and equipment                                               (1,614)                 (89)
    Other assets                                                                     (1,169)                (601)
                                                                          ------------------    -----------------

                    Net cash provided by (used in) investing activities              (4,766)               3,955

Financing activities:
    Proceeds from other sales of common stock                                         1,539                  ---
    Net proceeds from exercise of stock options                                       1,142                   67
                                                                          ------------------    -----------------

                    Net cash provided by financing activities                         2,681                   67
                                                                          ------------------    -----------------

Net increase (decrease) in cash and cash equivalents                                    622               (2,319)
Cash and cash equivalents at beginning of year                                        1,519                4,872
                                                                          ------------------    -----------------

Cash and cash equivalents at end of year                                  $           2,141     $          2,553
                                                                          ------------------    -----------------
                                                                          ------------------    -----------------


Supplemental disclosure of noncash investing and financing activities:
    Accretion of preferred stock                                          $              70
                                                                          ------------------
                                                                          ------------------
</TABLE>

See accompanying notes.

                                      5

<PAGE>

                         THE IMMUNE RESPONSE CORPORATION

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

                                 MARCH 31, 1999


1.     BASIS OF PRESENTATION
       The condensed consolidated financial statements of The Immune Response
       Corporation (the "Company") for the three months ended March 31, 1999 and
       1998 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 March 31, 1999, and the consolidated results of operations
       for the three months ended March 31, 1999 and 1998.  The results of
       operations for the three months ended March 31, 1999 are not necessarily
       indicative of the results to be expected for the year ended December 31,
       1999.  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, 1998 included in the Company's Form 10-K filed with the
       Securities and Exchange Commission.


2.     NET LOSS PER SHARE
       Net loss per share for the three months ended March 31, 1999 and 1998 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 as their effect
       would be antidilutive.  Therefore, there is no difference between basic
       and diluted net loss per share.


3.     COMPREHENSIVE INCOME
       In January 1998, the Company adopted 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
                                                   ------------------------------------
                                                      March 31,             March 31,
                                                        1999                   1998
                                                   --------------           -----------
<S>                                                <C>                      <C>

          Net loss                                    $ (1,327)              $ (7,949)
          Net unrealized gain (loss) on
            marketable securities                           61                     10
                                                   --------------           -----------
          Comprehensive loss                         $  (1,266)              $ (7,939)
                                                   --------------           -----------
                                                   --------------           -----------
</TABLE>

       All prior periods have been restated to reflect the adoption of this
       statement.

4.     EQUITY TRANSACTION

       In February 1999 the initial conversion price of the Series F Convertible
       Preferred Stock of $14.07 per share of common stock was adjusted downward
       to $9.77 per share of common stock.  The conversion price may be further
       adjusted downward, but not below a price of $5.00 per share, at the end
       of May and at the end of each subsequent three month periods if the
       Company's common stock does not trade at prices higher than the
       conversion price over a period of time during the applicable three month
       period.  The Series F Stock bears a dividend of 7.5% per annum.  The
       dividend is payable in shares of common stock or cash at the Company's
       option.  Further, The Company's option has expired to sell up to $10
       million more of the Series F Stock.

                                      6
<PAGE>

5.     COLLABORATIONS
       In January 1999, the Company received a $5 million payment from Agouron
       Pharmaceuticals,  Inc. ("Agouron") consisting of a $3 million payment for
       research and development and a $2 million payment for the purchase of
       149,911 shares of unregistered common stock priced at a premium to the
       market.  This was the second in a series of six quarterly payments that
       the Company expects Agouron to make to fund research and development and
       to purchase unregistered common stock under an agreement entered into in
       June 1998. Also in conjunction with this agreement, the Company received
       a $5 million milestone payment in February 1999. Under the agreement, the
       Company agreed to exclusively license REMUNE(TM), its immune-based
       therapy under development for the treatment of HIV infection, to Agouron.
       Under the terms of the agreement, the Company will manufacture commercial
       supplies of REMUNE and Agouron will have exclusive rights to market
       REMUNE in North America, Europe and certain other countries, if
       regulatory approvals are received.  Through March 31, 1999, the Company
       has received a total of $27 million from Agouron from licenses fees,
       milestone and research and development payments, and stock purchases.

       In March 1999,  the Company received a $988,000 payment from
       Schering-Plough Corporation ("Schering-Plough") to fund research under a
       research collaboration and option agreement entered into in July 1998.
       Under the research collaboration and option agreement the Company agreed
       to develop gene therapy products for the treatment of hepatitis B and C
       and as part of the agreement, Schering-Plough has the option to license
       the Company's gene delivery system for additional proprietary genes for
       other diseases for a royalty on future product sales, if any.  Through
       March 1999, the Company has received approximately $3 million in payments
       from Schering-Plough.


6.     SUBSEQUENT EVENT
       In April 1999, the Company received a $5 million payment from Agouron
       consisting of a $3 million payment for research and development and a $2
       million payment for the purchase of 189,350 shares of unregistered common
       stock priced at a premium to the market.  This was the third in a series
       of six quarterly payments that the Company expects Agouron to make to
       fund research and development and to purchase unregistered common stock
       under the June 1998 agreement.

                                      7

<PAGE>

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


SUMMARY

The Immune Response Corporation (the "Company") is a biopharmaceutical 
company developing immune-based therapies to induce specific T cell responses 
for the treatment of HIV, autoimmune diseases and cancer. The Company is 
conducting clinical trials for its immune-based therapies for HIV, rheumatoid 
arthritis, psoriasis, multiple sclerosis, colon cancer and brain cancer, and 
preclinical studies for prostate cancer and melanoma cancer.  In addition, 
the Company is developing a targeted delivery technology for gene therapy 
which is designed to enable the intravenous injection of genes for delivery 
directly to the liver. The Company's gene therapy program is currently in 
preclinical studies for the treatment of hemophilia and hepatitis.

This discussion contains forward-looking statements concerning the Company's 
operating results and timing of anticipated 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.  The 
Company undertakes 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 1999, the Company received a $5 million payment from Agouron 
Pharmaceuticals, Inc. ("Agouron") consisting of a $3 million payment for 
research and development and a $2 million payment for the purchase of 149,911 
shares of unregistered common stock priced at a premium to the market. This 
was the second in a series of six quarterly payments that the Company expects 
Agouron to make to fund research and development and to purchase unregistered 
common stock under an agreement entered into in June 1998.  Also in 
conjunction with this agreement, the Company received a $5 million milestone 
payment in February 1999.  Under the agreement, the Company agreed to 
exclusively license REMUNE, its immune-based therapy under development for 
the treatment of HIV infection, to Agouron.  Under the terms of the 
agreement, the Company will manufacture commercial supplies of REMUNE and 
Agouron will have exclusive rights to market REMUNE in North  America, Europe 
and certain other countries, if regulatory approvals are received.  Through 
March 31, 1999, the Company had received a total of $27 million from Agouron 
from licenses fees, milestone and research and development payments, and 
stock purchases.

In March 1999, the Company received a $988,000 payment from Schering-Plough 
Corporation ("Schering-Plough") to fund research under a research 
collaboration and option agreement entered into in July 1998. Under the 
research collaboration and option agreement the Company agreed to develop 
gene therapy products for the treatment of hepatitis B and C and as part of 
the agreement, Schering-Plough has the option to license the Company's gene 
delivery system for additional proprietary genes for other diseases for a 
royalty on future product sales, if any.  Through March 1999, the Company has 
received approximately $3 million in payments from Schering-Plough.

In April 1999, the Company received a $5 million payment from Agouron 
consisting of a $3 million payment for research and development and a $2 
million payment for the purchase of 189,350 shares of unregistered common 
stock priced at a premium to the market.  This was the third in a series of 
six quarterly payments that the Company expects Agouron to make to fund 
research and development and to purchase unregistered common stock under the 
June 1998 agreement.

The Company has not been profitable since inception and had an accumulated 
deficit of $173 million as of March 31, 1999.  To date, the Company has not 
recorded any revenues from the sale of products. Revenues recorded through 
March 31,1999 were earned in connection with contract research, licensing of 
technology, milestone achievement and investment income. The Company expects 
its operating losses to continue, as well as to 

                                      8
<PAGE>

have quarter-to-quarter fluctuations, some of which could be significant, due 
to expanded research, development and clinical trial activities.  There can 
be no assurance that the Company will be able to generate sufficient product 
revenue to become profitable at all or on a sustained basis.

RESULTS OF OPERATIONS 
Contract research revenue for quarter ended March 31, 1999 was $9.2 million 
as compared to $1.0  million for the same period in 1998.  The increase in 
contract revenue was primarily attributable to a $5.0 milestone payment and 
$3.0 million in research and development funding received from Agouron in 
conjunction with the collaboration to complete the clinical development and 
scale up of the manufacturing process for REMUNE. The Company has not 
received any revenue from the commercial sale of products and does not expect 
to derive revenue from the sale of products for the foreseeable future.

The Company incurred research and development expenses of $9.6 million and $8.3
million for the three months ending March 31, 1999 and March 31, 1998,
respectively.  The increased spending in research and development during the
first quarter of 1999 resulted from expenses associated with clinical trials and
scale up of the manufacturing process for REMUNE.  The Company expects research
and development expenditures to rise in the foreseeable future as it continues
its rheumatoid arthritis clinical trial and expands preclinical and clinical
testing of proposed gene therapy and cancer treatments.

General and administrative expenses for the first quarter of 1999 were $1.4
million as compared to $999,000 for the same period in 1998.  The increase in
spending was attributable to higher support costs associated with its research
and development activities.  General and administrative expenses for the
remainder of 1999 are expected to remain consistent with first quarter levels.

Investment income increased to $380,000 for the quarter ended March 31, 1999, up
from $311,000 during the same period in 1998. The increase in investment income
in 1999 compared to 1998, was due primarily to an increase in the Company's cash
position in the first quarter of 1999 compared to the first quarter of 1998.


LIQUIDITY AND CAPITAL RESOURCES
As of March 31, 1999, the Company had working capital of $21.5 million,
including $27.4 million of cash, cash equivalents and marketable securities.
This compares with working capital at December 31, 1998,  of $22.6 million,
including $24.9 million of cash, cash equivalents and marketable securities.
Working capital decreased despite the $10.0 million received from Agouron and
the $988,000 received from Schering-Plough, as the result of costs of
operations, in particular, due to the cost of the HIV clinical trials with
REMUNE and the capital improvements incurred to increase the capacity of the
manufacturing facility producing REMUNE. The increase in cash, cash equivalents
and marketable securities was due primarily to the sale of common stock to
Agouron and prepayment of research and development by Schering-Plough.

The Company will need to raise additional funds to conduct research and
development, preclinical studies and clinical trials necessary to bring its
potential products to market and establish manufacturing and marketing
capabilities.  The Company anticipates that in 1999, the REMUNE clinical trials
and manufacturing costs will continue to represent a significant portion of the
Company's overall expenditures.  The Company also anticipates that costs related
to the development of REMUNE will continue to increase.  In particular, the
Company anticipates additional capital improvements of approximately $3.0
million to be made during the remainder of 1999 related to increasing the
capacity of its manufacturing facility, some of which the Company anticipates it
will lease. Other anticipated costs with respect to REMUNE, including investment
in inventory, will depend on many factors, including the results of interim
analyses of the data from the Phase 3 clinical endpoint trial, the continuation
of the Company's collaboration with Agouron and other factors which will
influence the Company's determination of the appropriate continued investment of
the Company's financial resources in this program.

The Company's future capital requirements will depend on many factors, including
continued scientific progress in its 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

                                      9
<PAGE>

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 
the Company's control.  The Company intends 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. There can be no 
assurances, however, 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, the Company may 
be required to delay, reduce the scope of, or eliminate one or more of its 
research or development programs or take other measures to cut costs, which 
could have a  material adverse effect on the Company.  The Company estimates 
that its existing capital resources, funding under existing research and 
development collaborations and the commitment for equity funding from an 
existing collaborative partner,  together with currently available facility 
and equipment financing,  will be sufficient to fund its current and planned 
operations for the remainder of 1999.  There can be no assurances, however, 
that changes in the Company's research and development plans or other changes 
affecting the Company's operating expenses may result in the expenditure of 
such resources before such time. In any event, the Company will need to raise 
substantial additional capital to fund its operations in future periods.

IMPACT OF YEAR 2000
The Company has performed a review of its computer applications and equipment
related to their continuing functionality for the year 2000 and beyond. The
Company does not believe that it has material exposure with respect to the year
2000 issue concerning its computer applications and equipment. The Company is
communicating with third parties with whom it has a material relationship to
assess its risk with respect to year 2000 issues. This assessment is not
complete, in particular, because the Company has not completed inquiries of
such outside third parties. However, the Company is not aware, at this time, of
any material year 2000 issues with respect to its dealings with such third
parties. The Company anticipates that its assessment will be completed by
September 30, 1999. In the event that year 2000 issues were to disrupt the
Company, such disruption may have a material impact on the Company and its
results of operations. Since no significant issues have arisen, the Company
does not have a contingency plan to address any material year 2000 issues. A
contingency plan, if required, will be developed immediately upon completion of
the Company's assessment of our third party exposure. The Company has not yet
formulated a reasonably likely worst case scenario with respect to year 2000
failures.

CERTAIN RISK FACTORS (For a discussion of additional Risk Factors  applicable to
the Company,  see the  Company's  Annual  Report on Form 10-K for the year ended
December 31, 1998.)

RISK FACTORS
UNCERTAINTY OF PRODUCT DEVELOPMENT AND CLINICAL TESTING. The Company has not
completed the development of any products and there can be no assurance any
products will be successfully developed. The Company has been in existence since
1986, and to date only six of its product candidates have entered clinical
trials. The Company's potential immune-based therapies for HIV, autoimmune
disease, cancer and gene therapy products currently under development will
require significant additional research and development efforts and regulatory
approvals prior to potential commercialization. To achieve profitable
operations, the Company must successfully develop, manufacture, introduce and
market products. There can be no assurance that any of the Company's potential
products will prove to be safe and effective in clinical trials, that FDA or
other regulatory approvals will be obtained or that such products will achieve
market acceptance.

The Company's potential HIV immune-based therapy, REMUNE, is in a Phase 3
clinical endpoint trial designed to provide evidence of efficacy based on
clinical endpoints. There can be no assurance that the results of such clinical
trial will demonstrate that REMUNE is safe and efficacious or, that even if the
results of the clinical trial are considered successful by the Company, that the
Food and Drug Administration ("FDA") will not require the Company to conduct
additional large scale clinical trials with REMUNE before the FDA will consider
approving REMUNE for commercial sale. Failure to successfully complete the Phase
3 clinical endpoint trial in a timely fashion and a failure to obtain FDA
approval of REMUNE will materially and adversely affect the Company. There can
be no assurance that the results of the Phase 3 trial will be consistent with
Phase 2 results. In addition, REMUNE is being tested in a Phase 2 clinical trial
in Thailand, in

                                     10
<PAGE>

a pediatric Phase 1 clinical trial in the United States and in combination 
trials with approved HIV therapies in the United States and Spain. Failure of 
these trials to demonstrate the safety and effectiveness of REMUNE could have 
a material adverse effect on the regulatory approval process for this 
potential product.

The Company's other potential immune-based therapies and gene therapy 
technologies are at a much earlier stage of development than REMUNE. The 
Company's gene therapy technology and certain of its technologies for the 
treatment of cancer have not yet been tested in humans and there can be no 
assurance that human testing of potential products based on such technologies 
will be permitted by regulatory authorities or, that even if human testing is 
permitted, that products based on such technologies will be developed and 
shown to be safe or efficacious. Potential immune-based therapies based on 
certain of the Company's autoimmune technologies and certain of its cancer 
technologies are at an early stage of clinical testing and there can be no 
assurance that such products will be shown to be safe, efficacious or receive 
regulatory approval.

There can be no assurance that the results of the Company's preclinical 
studies and clinical trials will be indicative of future clinical trial 
results. A commitment of substantial resources to conduct time-consuming 
research, preclinical studies and clinical trials, including the REMUNE Phase 
3 clinical endpoint trial, will be required if the Company is to develop any 
products. Delays in planned patient enrollment in the Company's current 
clinical trials or future clinical trials may result in increased costs, 
program delays or both. There can be no assurance that any of the Company's 
potential products will prove to be safe and effective in clinical trials, 
that FDA or other regulatory approvals will be obtained or that such products 
will achieve market acceptance. Any products resulting from these programs 
are not expected to be successfully developed or commercially available for a 
number of years, if at all.

There can be no assurance that unacceptable toxicities or side effects will 
not 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 the Company's products. The appearance of any such 
unacceptable toxicities or side effects could interrupt, limit, delay or 
abort the development of any of the Company's products or, if previously 
approved, necessitate their withdrawal from the market. Furthermore, there 
can be no assurance that disease resistance will not limit the efficacy of 
potential products.

ADDITIONAL FINANCING REQUIREMENTS AND ACCESS TO CAPITAL. The Company will 
need to raise additional funds to conduct research and development, 
preclinical studies and clinical trials necessary to bring its potential 
products to market and establish manufacturing and marketing capabilities. 
The Company anticipates that in 1999, the REMUNE clinical trials and 
manufacturing costs will continue to represent a significant portion of the 
Company's overall expenditures. The Company also anticipates that costs 
related to the development of REMUNE will continue to increase. In 
particular, the Company anticipates additional capital improvements of 
approximately $3 million to be made during the remainder of 1999 related to 
increasing the capacity of its manufacturing facility, some of which the 
Company anticipates it will lease. Other anticipated costs with respect to 
REMUNE, including investment in inventory, will depend on many factors, 
including the results of interim analyses of the data from the Phase 3 
clinical endpoint trial, the continuation of the Company's collaboration with 
Agouron and other factors which will influence the Company's determination of 
the appropriate continued investment of the Company's financial resources in 
this program.

The Company's future capital requirements will depend on many factors, 
including continued scientific progress in its 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 the Company's control. The Company intends 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. There can be no 
assurances, however, 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, the Company may 
be required to delay, reduce the scope of, or eliminate one or more of its 
research or development programs or take other measures to cut costs, which 
could have a material adverse effect on the Company. The Company estimates 
that its existing capital

                                     11
<PAGE>

resources, funding under existing research and development collaborations and 
the commitment for equity funding from an existing collaborative partner, 
together with currently available facility and equipment financing, will be 
sufficient to fund its current and planned operations for the remainder of 
1999. There can be no assurances, however, that changes in the Company's 
research and development plans or other changes affecting the Company's 
operating expenses will not result in the expenditure of such resources 
before such time. In any event, the Company will need to raise substantial 
additional capital to fund its operations in future periods.

PATENTS AND PROPRIETARY TECHNOLOGY. The Company has filed, or participated as 
licensee, in the filing of a number of patent applications in the United 
States and many international countries. The Company files applications as 
appropriate for patents covering its products and processes. The Company has 
been issued patents, or has licensed patents, covering certain aspects of its 
proposed immune-based therapies for HIV, autoimmune disease, cancer and gene 
therapy technologies. The Company's success may depend in part on its ability 
to obtain patent protection for its products and processes. The Company is 
aware that a group working with Connetics Corporation has received a United 
States patent related to autoimmune disease research that covers technology 
similar to that used by the Company.

There can be no assurance that the Company will be successful in opposition
proceedings. An unfavorable outcome could have an adverse impact on the
Company's ability to consummate future corporate partnerships or market
autoimmune disease products. There can be no assurance that the Company will be
able to negotiate any necessary cross licenses, and if not successful, failure
to do so could have a negative impact on the Company. There can be no assurance
that the Company's patent applications will be issued as patents or that any of
its issued patents, or any patent that may be issued in the future, will provide
the Company with adequate protection for the covered products, processes or
technology.

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 pharmaceutical patents cannot be
predicted. The Company also relies upon unpatented trade secrets and know how,
and no assurance can be given that others will not independently develop
substantially equivalent trade secrets or know how. In addition, whether or not
the Company's patents are issued, or issued with limited coverage, others may
receive patents which contain claims applicable to the Company's product. There
can be no assurance that any of the Company's patents, or any patents issued to
the Company in the future, will afford meaningful protection against
competitors. Defending any such patent could be costly to the Company, and there
can be no assurance that the patent would be held valid by a court of competent
jurisdiction.

The Company also relies on protecting its proprietary technology in part through
confidentiality agreements with its corporate collaborators, employees,
consultants and certain contractors. There can be no assurance that these
agreements will not be breached, that the Company will have adequate remedies
for any breach, or that the Company's trade secrets will not otherwise become
known or independently discovered by its competitors.

It is possible that the Company's products or processes will infringe, or will
be found to infringe, patents not owned or controlled by the Company, such as
the patent owned by Connetics Corporation. If any relevant claims of third-party
patents are upheld as valid and enforceable, the Company could be prevented from
practicing the subject matter claimed in such patents, or would be required to
obtain licenses or redesign its products or processes to avoid infringement.
There can be no assurance that such licenses would be available at all or on
terms commercially reasonable to the Company or that the Company could redesign
its products or processes to avoid infringement. Litigation may be necessary to
defend against claims of infringement, to enforce patents issued to the Company
or to protect trade secrets. Such litigation could result in substantial costs
and diversion of management efforts regardless of the results of such litigation
and an adverse result could subject the Company to significant liabilities to
third parties, require disputed rights to be licensed or require the Company to
cease using such technology.

HISTORY OF OPERATING LOSSES. As of March 31, 1999, the Company had a
consolidated accumulated deficit of $173 million. The Company has not generated
revenues from the commercialization of any products and expects to incur
substantial net operating losses over the next several years. There can be no

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<PAGE>

assurance that the Company will be able to generate sufficient product 
revenue to become profitable at all or on a sustained basis. The Company 
expects to have quarter-to-quarter fluctuations in expenses, some of which 
could be significant, due to expanded research, development and clinical 
trial activities.

LENGTHY APPROVAL PROCESS AND UNCERTAINTY OF GOVERNMENT REGULATORY 
REQUIREMENTS. Clinical testing, manufacture, promotion and sale of the 
Company's drug products are subject to extensive regulation by numerous 
governmental authorities in the United States, principally the FDA, and 
corresponding state and foreign regulatory agencies. The Company believes 
that REMUNE and most of its other potential immune-based therapies will be 
regulated by the FDA as biological drug products under current regulations of 
the FDA. Biological products must be shown to be safe, pure and potent (i.e., 
effective) and are subject to the same regulatory requirements as 
nonbiological products under the Food, Drug and Cosmetic Act ("FDC Act"), as 
amended by the Food and Drug Administration Act ("FDA Modernization Act"), 
except that a biological product licensed under the Public Health Services 
Act ("PHS Act") is not required to have an approved NDA under the FDC Act. 
The FDA Modernization Act directed the FDA to take measures to minimize the 
differences in the review and approval of marketing applications for 
biological and nonbiological products. The FDA Modernization Act also made 
significant revisions to the statutory requirements with regard to the 
approval of new biological and nonbiological products. Among other things, 
the FDA Modernization Act established a new statutory program for the 
approval of fast track drugs, streamlined clinical research, and revised the 
content of product approval applications and the FDA review process. The FDA 
is required to issue regulations and guidelines in order to implement certain 
of these new requirements. Until the FDA issues and implements these 
regulations and guidelines, it is impossible to predict the impact of the FDA 
Modernization Act on the review and approval of any marketing applications 
that the Company may submit to the FDA. The FDC Act, the PHS Act and other 
federal and state statutes and regulations govern or influence the testing, 
manufacture, safety, effectiveness, labeling, storage, recordkeeping, 
approval, advertising, distribution and promotion of biological prescription 
drug 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 and there can
be no assurance that necessary FDA clearances will be obtained in a timely
manner, if at all. There can be no assurance as to the length of the clinical
trial period or the number of patients the FDA will require to be enrolled in
the clinical trials in order to establish the safety and efficacy of the
Company's products. The Company may encounter significant delays or excessive
costs in its efforts to secure necessary approvals, and regulatory requirements
are evolving and uncertain. Future United States or foreign legislative or
administrative acts could also prevent or delay regulatory approval of the
Company's products. There can be no assurance that the Company will be able to
obtain the necessary approvals for clinical trials, manufacturing or marketing
of any of its 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.

The steps required before a biological drug product may be marketed in the
United States generally include preclinical studies and the filing of an IND
application with the FDA. Reports of results of preclinical studies and clinical
trials for biological drug products are submitted to the FDA in the form of a
Biologics Licensing Application ("BLA") for approval for marketing and
commercial shipment. Submission of a BLA does not assure FDA approval for
marketing. The BLA review process may take a number of years to complete,
although reviews of applications for treatments of AIDS, cancer and other
life-threatening diseases may be accelerated or expedited. Failure of the
Company to receive FDA marketing approval for REMUNE or any of its other
products under development on a timely basis could have a material adverse
effect on the Company's business, financial condition and results of operations.
In addition to obtaining approval for each biological drug product, an
Establishment License Application ("ELA") usually must be filed and approved by
the FDA.

                                      13
<PAGE>

Among the other requirements for BLA approval is the requirement that 
prospective manufacturers conform to the FDA's Good Manufacturing Practices 
("GMP") requirements specifically for biological drugs, as well as for other 
drugs. In complying with the FDA's GMP requirements, manufacturers must 
continue to expend time, money and effort in production, recordkeeping and 
quality control to assure that the product meets applicable specifications 
and other requirements. Failure to comply with the FDA's drug GMP 
requirements subjects the manufacturer to possible FDA regulatory action. 
There can be no assurance that the Company or its contract manufacturers, if 
any, will be able to maintain compliance with the FDA's drug GMP requirements 
on a continuing basis. Failure to maintain such compliance could have a 
material adverse effect on the Company's business, financial condition and 
results of operations.

The Company believes its proprietary GeneDrug and cancer treatment therapies 
will likely be regulated as biological products. As with the Company's other 
potential products, the gene therapy and cancer products will be subject to 
extensive FDA regulation throughout the product development process, and 
there can be no assurance that any of these products will be successful at 
securing the requisite FDA marketing approval on a timely basis, if at all.

The FDA Modernization Act also amended the FDC Act to permit expanded access 
to individuals and larger groups to unapproved new therapeutic and diagnostic 
products. Although the new law largely codifies existing FDA regulations in 
this area, it expands access to all investigational therapies under certain 
conditions. Although the FDA has granted expanded access to REMUNE for those 
patients who are ineligible to enroll in the Phase 3 clinical endpoint trial, 
the FDA has to date not designated expanded access protocols for REMUNE as 
"treatment" protocols. Either expanded access or a treatment protocol 
designation might permit third party reimbursement of some of the costs 
associated with making REMUNE available to patients in such an expanded 
access context. There can be no assurance that the FDA will determine that 
REMUNE meets all of the FDA's criteria for use of an investigational drug for 
treatment use or that, even if the product is allowed for treatment use, that 
third party payers will provide reimbursement for any of the costs of 
treatment with REMUNE.

The FDA also has issued regulations to accelerate the approval of or to 
expedite the review of new biological drug products for serious or 
life-threatening illnesses that provide meaningful therapeutic benefit to 
patients over existing treatments. Under the accelerated approval program, 
the FDA may grant marketing approval for a biological or nonbiological drug 
product earlier than would normally be the case. In addition to the 
accelerated approval process, the FDA has established procedures designed to 
expedite the development, evaluation and marketing of new therapies intended 
to treat persons with life-threatening and severely-debilitating illnesses, 
especially when no satisfactory alternative therapy exists. In addition, the 
FDA Modernization Act established a new statutory program for the approval of 
fast track drugs, including biological products. There can be no assurance 
that the FDA will consider REMUNE or any other of the Company's products 
under development to be an appropriate candidate for accelerated approval, 
expedited review or fast track designation.

To market any drug products outside of the United States, the Company is also 
subject to numerous and varying foreign regulatory requirements, implemented 
by foreign health authorities, governing the design and conduct of human 
clinical trials and marketing approval. The approval procedure varies among 
countries and can involve additional testing, and the time required to obtain 
approval may differ from that required to obtain FDA approval. The foreign 
regulatory approval process includes 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. The biotechnology industry continues to 
undergo rapid change and competition is intense in the fields of HIV, 
autoimmune disease, cancer and gene therapy, and such competition is expected 
to increase. The Company will compete with fully integrated pharmaceutical 
companies, small biotechnology companies, universities and research 
organizations. There can be no assurance that competitors have not or will 
not succeed in developing technologies and products that are more effective 
than any which have been or are being developed by the Company or which would 
render the Company's technology and products obsolete and noncompetitive. 
Many of the Company's competitors have substantially greater experience, 
financial and technical resources and production, marketing and development 
capabilities than the Company. Accordingly, certain of the Company's

                                     14
<PAGE>

competitors may succeed in obtaining regulatory approval for products more 
rapidly or effectively than the Company. If the Company commences commercial 
sales of its products, it will also be competing with respect to 
manufacturing efficiency and sales and marketing capabilities, areas in which 
it currently has no experience. There can be no assurance that competitors 
will not develop and commercialize more effective or affordable products.

DEPENDENCE ON THIRD PARTIES. The Company's strategy for the research, 
development and commercialization of its products requires entering into 
various arrangements with corporate collaborators, licensors, licensees and 
others, and the Company's commercial success is dependent upon these outside 
parties performing their respective contractual responsibilities, including 
the analysis of the data generated in the Company's clinical trials. The 
amount and timing of resources such third parties will devote to these 
activities may not be within the control of the Company. There can be no 
assurance that such parties will perform their obligations as expected and 
the failure of third parties to perform their obligations would have a 
material adverse effect on the Company. Although the Company has 
collaborative agreements with several universities and research institutions, 
the Company's agreements with Agouron, Schering-Plough and Bayer are the only 
collaborative agreements that provides the Company with contract revenue. 
Agouron is in the process of obtaining shareholder approval on the sale of 
the company to Warner-Lambert Company ("Warner-Lambert"). Though Agouron is 
to remain a separate entity as a wholly-owned subsidiary of Warner-Lambert, 
there can be no assurance as to which Agouron research projects 
Warner-Lambert will continue to fund in the future.

There can be no assurance that any of the Company's collaborations will not 
be terminated or will result in the development of any commercial products. 
Immune Response intends to seek additional collaborative arrangements to 
develop and commercialize certain of its products. There can be no assurance 
that the Company will be able to negotiate collaborative arrangements on 
favorable terms, or at all, in the future, or that its current or future 
collaborative arrangements will be successful.

DEPENDENCE ON KEY PERSONNEL. Since its inception, Immune Response has relied on
the technical and management skills of its experienced staff. The Company does
not maintain key man life insurance on any of its personnel. The Company's
success also depends in large part upon its ability to attract and retain highly
qualified scientific and management personnel. The Company faces competition for
such personnel from other companies, academic institutions, government entities
and other organizations. There can be no assurance that the Company will be
successful in hiring or retaining requisite personnel.

LACK OF COMMERCIAL MANUFACTURING AND MARKETING EXPERIENCE. The Company has a 
manufacturing facility for REMUNE located in King of Prussia, Pennsylvania, 
and a pilot manufacturing facility in Carlsbad, California for its other 
products. The Company has not yet manufactured its product candidates in 
commercial quantities. No assurance can be given that the Company, on a 
timely basis, will be able to make the transition from manufacturing clinical 
trial quantities to commercial production quantities successfully or be able 
to arrange for contract manufacturing. The Company believes it will be able 
to manufacture REMUNE for initial commercialization, if the product obtains 
FDA approval, but it has not yet demonstrated the capability to manufacture 
REMUNE in commercial quantities, or its autoimmune disease, cancer and gene 
therapy treatments in large-scale clinical or commercial quantities. The 
Company has no experience in the sales, marketing and distribution of 
pharmaceutical products. There can be no assurance that the Company will be 
able to establish sales, marketing and distribution capabilities or make 
arrangements with its collaborators, licensees or others to perform such 
activities or that such efforts will be successful. There can be no assurance 
of market acceptance of the Company's products, if they are developed and 
approved for commercialization.

The manufacture of the Company's products involves a number of steps and
requires compliance with stringent quality control specifications imposed by the
Company itself and by the FDA. Moreover, the Company's products can only be
manufactured in a facility that has undergone a satisfactory inspection by the
FDA. For these reasons, the Company would not be able quickly to replace its
manufacturing capacity if it were unable to use its 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 drug GMP requirements and the non-compliance could not be rapidly
rectified. The Company's 

                                     15
<PAGE>

inability or reduced capacity to manufacture its products would have a 
material adverse effect on the Company's business and results of operations.

The Company may enter into arrangements with contract manufacturing companies 
to expand its own production capacity in order to meet requirements for its 
products, or to attempt to improve manufacturing efficiency. If the Company 
chooses to contract for manufacturing services and encounters delays or 
difficulties in establishing relationships with manufacturers to produce, 
package and distribute its finished products, clinical trials, market 
introduction and subsequent sales of such products would be adversely 
affected. Further, contract manufacturers must also operate in compliance 
with the FDA's drug GMP requirements; failure to do so could result in, among 
other things, the disruption of product supplies. Until recently, biologic 
product licenses could not be held by any company unless it performed 
significant manufacturing operations. The FDA has amended its regulations in 
this regard, and the Company believes that under the revised regulations it 
can now hold licenses for its biological products without performing 
significant manufacturing steps. Nonetheless, the Company's potential 
dependence upon third parties for the manufacture of its products may 
adversely affect the Company's profit margins and its ability to develop and 
deliver such products on a timely and competitive basis.

UNCERTAINTY OF PRODUCT PRICING, REIMBURSEMENT AND RELATED MATTERS. The 
Company's ability to earn sufficient returns on its products will depend in 
part on the extent to which reimbursement for the costs of such products and 
related treatments will be available from government health administration 
authorities, private health coverage insurers, managed care organizations and 
other organizations. Third party payors are increasingly challenging the 
price of medical products and services. If purchasers or users of the 
Company's products are not able to obtain adequate reimbursement for the cost 
of using such products, they may forego or reduce such use. Significant 
uncertainty exists as to the reimbursement status of newly approved health 
care products, and there can be no assurance that adequate third party 
coverage will be available. Failure to obtain appropriate reimbursement would 
have a material adverse effect on the Company.

PRODUCT LIABILITY EXPOSURE. The Company faces an inherent business risk of 
exposure to product liability and other claims in the event that the 
development or use of its technology or prospective products is alleged to 
have resulted in adverse effects. While the Company has taken, and will 
continue to take, what it believes are appropriate precautions, there can be 
no assurance that it will avoid significant liability exposure. Although the 
Company currently carries product liability insurance for clinical trials, 
there can be no assurance that the Company has sufficient coverage, or can 
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 products developed by the Company. A product liability 
claim could have a material adverse effect on the Company's business, 
financial condition and results of operations.

HAZARDOUS MATERIALS/ENVIRONMENTAL MATTERS. Although the Company does not 
currently manufacture commercial quantities of its product candidates, it 
produces limited quantities of such products for its clinical trials. The 
Company's research and development processes involve the controlled storage, 
use and disposal of hazardous materials, biological hazardous materials and 
radioactive compounds. The Company is subject to federal, state and local 
laws and regulations governing the use, manufacture, storage, handling and 
disposal of such materials and certain waste products. Although the Company 
believes that its safety procedures for handling and disposing of such 
materials comply with the standards prescribed by such laws and regulations, 
the risk of accidental contamination or injury from these materials cannot be 
completely eliminated. In the event of such an accident, the Company could be 
held liable for any damages that result, and any such liability could exceed 
the resources of the Company. There can be no assurance that the Company will 
not be required to incur significant costs to comply with current or future 
environmental laws and regulations nor that the operations, business or 
assets of the Company will not be materially or adversely affected by current 
or future environmental laws or regulations.

VOLATILITY OF STOCK PRICE AND ABSENCE OF DIVIDENDS. The market price of 
Immune Response's 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 results of preclinical studies and clinical trials by the 
Company, its collaborators or its competitors, other evidence of the safety 
or efficacy of products of the Company or its 

                                     16
<PAGE>

competitors, announcements of technological innovations or new products by 
the Company or its competitors, governmental regulatory actions, changes or 
announcements in reimbursement policies, developments with the Company's 
collaborators, developments concerning patent or other proprietary rights of 
the Company or its competitors (including litigation), concern as to the 
safety of the Company's products, period-to-period fluctuations in the 
Company's operating results, changes in estimates of the Company's 
performance by securities analysts, market conditions for biopharmaceutical 
stocks in general and other factors not within the control of the Company 
could have a significant adverse impact on the market price of the common 
stock. The Company has never paid cash dividends on its common stock and does 
not anticipate paying any cash dividends in the foreseeable future.

EFFECT OF CERTAIN ANTI-TAKEOVER PROVISIONS.  The Company's 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 the Company's 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 contained in the Company's 
Certificate of Incorporation.  Further, pursuant to the terms of its 
stockholder rights plan, the Company has 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 the Company on terms not approved by the Board of Directors and may 
have the effect of deterring hostile takeover attempts.

                                     17

<PAGE>

PART II.  OTHER INFORMATION

ITEM 6. -- EXHIBITS AND REPORTS ON FORM 8-K

a)     Exhibits

          27.1    Financial Data Schedule

b)   Reports on Form 8-K

          Not applicable








                                     18

<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:  May 11, 1999            /s/ Rand P. Mulford
                               -------------------------------------
                               Rand P. Mulford
                               Sr. Vice President, Corporate Development,
                               Chief Financial Officer, Secretary and Treasurer






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