<PAGE>   1
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-QSB

(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, 2001

[ ]   TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT

      For the transition period from ___________ to __________

                         Commission file number 0-12627

                            MEDICAL DISCOVERIES, INC.
                            -------------------------
        (Exact name of Small Business Issuer as specified in its charter)

             Utah                                         87-0407858
-------------------------------                        ----------------
(State or other jurisdiction of                         (I.R.S. Employer
incorporation or organization)                         Identification No.)


                   738 Aspenwood Lane, Twin Falls, Idaho 83301
--------------------------------------------------------------------------------
                    (Address of principal executive offices)

                                 (208) 736-1799
--------------------------------------------------------------------------------
                (Issuer's telephone number, including area code)

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

Check whether the issuer: (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act 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 [ ]


                      APPLICABLE ONLY TO CORPORATE ISSUERS:

      State the number of shares outstanding of each of the issuer's classes of
common equity, as of the latest practicable date: As of May 10, 2001, there were
32,533,421 shares of the issuer's Common Stock outstanding.

Transitional Small Business Disclosure Format (check one): Yes [ ]  No [X]


<PAGE>   2

                                     PART I
                              FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

The following financial statements are filed with this report:

      Condensed Consolidated Balance Sheet as of March 31, 2001, (unaudited) and
      December 31, 2000

      Condensed Consolidated Statements of Operations for the three-month
      periods ended March 31, 2001 (unaudited) and March 31, 2000 (unaudited)
      and cumulative amounts since inception through March 31, 2001 (unaudited)

      Condensed Consolidated Statements of Cash Flows for the three-month
      periods ended March 31, 2001 (unaudited) and March 31, 2000 (unaudited)
      and cumulative amounts since inception through March 31, 2001 (unaudited)

      Notes to Unaudited Financial Statements



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<PAGE>   3

                   MEDICAL DISCOVERIES, INC. AND SUBSIDIARIES
                          (A DEVELOPMENT STAGE COMPANY)
                      CONDENSED CONSOLIDATED BALANCE SHEET
             As of March 31, 2000 (Unaudited) and December 31, 2000

<TABLE>
<CAPTION>
                                                                                March 31, 2001    December 31, 2000
                                                                                --------------    -----------------
<S>                                                                              <C>                <C>
Current assets
     Cash                                                                        $     36,144       $     19,781
                                                                                 ------------       ------------

                                                   Total current assets                36,144             19,781

Equipment, at cost, net of accumulated depreciation                                     3,285              4,614
                                                                                 ------------       ------------

                                                                                 $     39,429       $     24,395
                                                                                 ============       ============

Current liabilities
     Accounts payable                                                            $  1,505,078       $  1,509,679
     Accrued interest                                                                 236,901            192,716
     Current portion of notes payable                                                 625,807            520,807
     Convertible notes payable                                                        193,200            193,200
                                                                                 ------------       ------------

                                              Total current liabilities             2,560,986          2,416,402

Stockholders' deficit
     Escrow receivable                                                               (384,600)          (384,600)
     Common stock, no par value, authorized 100,000,000 shares;
       32,075,421 shares issued and outstanding at March 31, 2001 and
       December 31, 2000                                                           10,413,837         10,413,837
     Accumulated deficit                                                          (12,550,794)       (12,421,244)
                                                                                 ------------       ------------

                                            Total stockholders' deficit            (2,521,557)        (2,392,007)
                                                                                 ------------       ------------

                                                                                 $     39,429       $     24,395
                                                                                 ============       ============

                                              See accompanying notes
</TABLE>



                                       3
<PAGE>   4

                   MEDICAL DISCOVERIES, INC. AND SUBSIDIARIES
                          (A DEVELOPMENT STAGE COMPANY)
                CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
            For the Periods Ended March 31, 2001 and March 31, 2000,
                             and Cumulative Amounts
                                  (Unaudited)

<TABLE>
<CAPTION>
                                                                                                      Cumulative
                                                                For the Three Months                 Amounts Since
                                                                  Ended March 31,                    November 20,
                                                          ---------------------------------         1991 (Date of
                                                              2001                 2000               Inception)
                                                          ------------         ------------          ------------
<S>                                                       <C>                  <C>                  <C>
Revenues                                                  $         --         $      7,620         $    134,104

Cost of goods sold                                                  --                2,511               10,526
                                                          ------------         ------------         ------------

                                    Gross profit                    --                5,109              123,578

Research and development expenses                                   --                   --            2,389,441
Inventory writedown                                                 --                   --               96,859
Impairment loss                                                     --                   --                9,709
License                                                             --                   --            1,001,500
General and administrative expenses                             85,365               49,559            8,200,718
                                                          ------------         ------------         ------------

                                  Operating loss               (85,365)             (44,450)         (11,574,649)

Other income (expense)
    Interest income                                                 --                   --               23,406
    Other income                                                    --                   --              268,926
    Interest expense                                           (44,185)             (14,632)            (315,940)
                                                          ------------         ------------         ------------
                                                               (44,185)             (14,632)             (23,608)

                    Loss before income taxes and
                              extraordinary item              (129,550)             (59,082)         (11,598,257)

                                    Income taxes                    --                   --                   --

      Forgiveness of debt net of $0 income taxes                    --                   --            1,235,536
                                                          ------------         ------------         ------------

              Net loss available to shareholders          $   (129,550)        $    (59,082)        $(10,362,721)
                                                          ============         ============         ============

Net loss per share
    Continuing operations                                 $      (0.00)        $      (0.00)        $      (0.56)
    Extraordinary item                                              --                   --                 0.06
                                                          ------------         ------------         ------------
                              Net loss per share          $      (0.00)        $      (0.00)        $      (0.50)
                                                          ============         ============         ============

Weighted average shares outstanding                         32,075,421           26,656,959           20,619,768

                                              See accompanying notes
</TABLE>



                                        4
<PAGE>   5

                   MEDICAL DISCOVERIES, INC. AND SUBSIDIARIES
                          (A DEVELOPMENT STAGE COMPANY)
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
            For the Periods Ended March 31, 2001 and March 31, 2000,
                             and Cumulative Amounts
                                  (Unaudited)

<TABLE>
<CAPTION>

                                                                                                     Cumulative
                                                                   For the Three Months             Amounts Since
                                                                     Ended March 31,                November 20,
                                                              -------------------------------       1991 (Date of
                                                                  2001               2000            Inception)
                                                              ------------       ------------       -------------
<S>                                                           <C>                <C>                <C>
Cash flows from operating activities
   Net loss                                                   $   (129,550)      $    (59,082)      $(11,151,217)
   Adjustments to reconcile net loss to net
   cash used by operating activities
       Common stock issued for research costs                           --                 --            115,400
       Common stock options issued for services                         --                 --          2,556,890
       Common stock issued for services, expenses,
           and litigation                                               --                 --          3,559,986
       Reduction of legal costs                                         --                 --           (130,000)
       Depreciation                                                  1,329              2,771             96,986
       Write-off of subscription receivables                            --                 --            112,500
       Impairment loss on assets                                        --                 --              9,709
       Loss on disposal of equipment                                    --                 --             30,364
       Gain on debt restructuring                                       --                 --         (1,235,536)
       Write-off of receivables                                         --                 --            193,965
       Changes in assets and liabilities
           Accounts receivable                                          --                 --             (7,529)
           Inventory                                                    --              2,511                 --
           Prepaid expenses                                             --                 --                 --
           Other assets                                                 --                900                 --
           Accounts payable                                         (4,601)             8,811          1,349,169
           Accrued expenses                                         44,185             14,500            258,382
                                                              ------------       ------------       ------------

                   Net cash used by operating activities           (88,637)           (29,589)        (4,240,931)

Cash flows from investing activities
   Purchase of equipment                                                --                 --           (132,184)
   Payments received on note receivable                                 --                 --            130,000
                                                              ------------       ------------       ------------

                   Net cash used by investing activities                --                 --             (2,184)

Cash flows from financing activities
   Contributed equity                                                   --                 --            131,374
   Issuance of common stock                                             --                 --          3,255,359
   Payments on notes payable                                       (25,000)                --           (122,287)
   Proceeds from notes payable                                     130,000             20,000            796,613
   Payments on convertible notes payable                                --                 --            (98,500)
   Proceeds from convertible notes payable                              --                 --            316,700
                                                              ------------       ------------       ------------

               Net cash provided by financing activities           105,000             20,000          4,279,259
                                                              ------------       ------------       ------------

                         Net increase (decrease) in cash            16,363             (9,589)            36,144

Cash, beginning of period                                           19,781             10,152                 --
                                                              ------------       ------------       ------------

                                     Cash, end of period      $     36,144       $        563       $     36,144
                                                              ============       ============       ============

                                              See accompanying notes
</TABLE>



                                       5
<PAGE>   6

                   MEDICAL DISCOVERIES, INC. AND SUBSIDIARIES
                          (A DEVELOPMENT STAGE COMPANY)
                     NOTES TO UNAUDITED FINANCIAL STATEMENTS
                                 MARCH 31, 2001

NOTE 1. UNAUDITED INTERIM FINANCIAL STATEMENTS.

The accompanying unaudited financial statements have been prepared by the
Company pursuant to the rules and regulations of the Securities and Exchange
Commission. Certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted pursuant to such rules and
regulations. In the opinion of management, all adjustments and disclosures
necessary to a fair presentation of these financial statements have been
included. These financial statements should be read in conjunction with the
financial statements and notes thereto included in the Company's 2000 Annual
Report on Form 10-KSB for the year ended December 31, 2000, as filed with the
Securities and Exchange Commission.

Certain reclassifications and other corrections for rounding have been made in
prior period financial statements to conform to the current period presentation.
The consolidated financial statements include the accounts of the Company and
its wholly owned subsidiaries. All significant inter-company transactions and
balances have been eliminated in consolidation.

NOTE 2. GOING CONCERN CONSIDERATIONS.

The Company's recurring losses from the Company's development-stage activities
in current and prior years raise substantial doubt about the Company's ability
to continue as a going concern. The financial statements do not include any
adjustments to reflect the possible effects on the recoverability and
classification of assets or amounts and classifications of liabilities that may
result from the possible inability of the Company to continue as a going
concern. The Company is attempting to raise additional capital to sustain
operations. However, there can be no assurance that these plans will be
successful.

NOTE 3. CONTINGENCIES REGARDING HARVEST JV AGREEMENT.

As of June 28, 2000, the Company, an outside investment group (Harvest Group,
L.L.C. ("Harvest")), and Hydromedics, Inc. ("Hydromedics"), a corporation formed
by Harvest and two other investors, entered into a so-called JV Agreement (the
"JV Agreement"). The JV Agreement contemplated that the Company would (1) assign
to Hydromedics its rights to certain skin care products, (2) issue 13,000,000
shares to Harvest, and (3) seek to appoint two Harvest representatives to the
Company's board of directors. In return, Hydromedics would (1) issue 2,000,000
of its shares to the Company, (2) assume certain obligations of the Company
associated with the skin care products to be transferred, and (3) market the
skin care products. As for Harvest's obligations, the JV Agreement contemplated
that Harvest would (1) assign to the Company 20,000,000 of its previously-owned
Hydromedics shares and (2) make available to the Company a $150,000 line of
credit. Finally, the JV Agreement contemplated certain post-closing obligations
including (1) Harvest making an additional investment in Hydromedics in exchange
for 30,000,000 shares of Hydromedics stock, (2) Harvest assigning 20,000,000 of
such shares to the Company, and (3) the Company issuing an additional 12,000,000
shares of its stock to Harvest. In total, the transactions contemplated by the
JV Agreement would result in the Company owning approximately 40% of Hydromedics
and Harvest owning 25,000,000 new shares of the Company's stock (which, if
issued, would equal approximately 44% of the Company's total outstanding stock).

The JV Agreement provided that the transactions contemplated above were to have
closed on June 28, 2000. However, no closing occurred on June 28, 2000 or since
and the Company has taken the position that the transactions contemplated by the
JV Agreement have not been consummated. Months later, Harvest and Hydromedics
attempted to tender partial performance under the JV Agreement. The Company
rejected that tender and has taken the position that the JV Agreement is no
longer enforceable by any of the parties because no party timely or completely
tendered performance.

On December 26, 2000, Harvest demanded arbitration of the dispute pursuant to
terms of the JV Agreement. In its arbitration demand, Harvest is seeking
specific performance of the JV Agreement or damages in excess of $1 million. All
parties have agreed to attempt to mediate this dispute prior to proceeding to
arbitration. The Company expects that mediation to occur in June, 2001. If a
court or arbitrator were to force the Company and the other parties to
specifically perform the transactions contemplated by the JV Agreement, the
Company's shareholders could suffer significant dilution because the value of
the consideration the Company will receive under the JV Agreement could be
substantially less than the current market value of the stock to be issued to
Harvest. In addition, specific performance could result in significant changes
to the Company's financial statements, especially if the JV Agreement were
deemed to have been consummated during a period already reported. The financial
statements do not include any adjustments or reserves to reflect the possible
effects of such a result.



                                       6
<PAGE>   7

NOTE 4. COMMITMENT REGARDING PEREGRINE STOCK.

Peregrine Properties, LLC, a Utah limited liability company ("Peregrine"), has
entered into an agreement to provide $500,000 to the Company to fund testing and
research steps necessary to continue development of MDI-P. The studies will be
funded through an escrow agent. As of March 31, 2001, the Company has deposited
in escrow a single certificate for 5.5 million shares of common stock for these
purposes. As of March 31, 2001, Peregrine had funded $120,000 to the escrow, of
which $115,400 had been disbursed and recorded as research and development
expense on the financial statements of the Company. The remaining $384,600 to be
expended under the agreement has been recorded on the balance sheet in equity
under the caption "escrow receivable." As expenditures are made from the escrow
for research and development, the expenses will be recorded on the books of the
Company with a corresponding reduction in the escrow receivable. Upon completion
of the studies, the escrow agent will disburse the 5.5 million shares to
Peregrine and will disburse the research results to the Company.

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

The purpose of this section is to discuss and analyze the Company's consolidated
financial condition, liquidity and capital resources, and results of operations.
This analysis should be read in conjunction with the financial statements and
notes thereto at pages 2 through 7 and Management's Discussion and Analysis of
Financial Condition and Results of Operations contained in the Company's Annual
Report on Form 10-KSB for the year ended December 31, 2000 (the "2000 10-KSB").

This section contains certain forward-looking statements that involve risks and
uncertainties, including statements regarding the Company's plans, objectives,
goals, strategies and financial performance. The Company's actual results could
differ materially from the results anticipated in these forward-looking
statements as a result of factors set forth under "Cautionary Statement for
Forward-Looking Information" below and elsewhere in this report.

                                    OVERVIEW

Medical Discoveries, Inc. (the "Company" or "MDI") has developed a product
(hereafter "MDI-P") that appears to have the ability to destroy certain viruses,
bacteria and fungi. MDI-P may possibly be used as a sterilizing agent for
medical and dental instruments. MDI-P may also potentially be used to remove or
inactivate infectious agents in human and animal blood-derived products, such as
plasma and gamma globulin.

The Company is committed to its pursuit of establishing MDI-P as an effective
anti-bacterial, anti-viral and anti-fungal pharmaceutical for in-vitro and
in-vivo applications and to developing MDI-P as an effective liquid chemical
sterilant for a variety of applications.

MDI is a development stage company. To date, the Company has not generated
significant revenues from operations or realized a profit. The Company is
presently investing all of its resources in the testing, development and
commercialization of MDI-P and its other technologies. The Company is attempting
to raise additional funding to continue development of its technologies and to
submit its technologies to appropriate regulatory agencies to secure approvals
when required for the marketing and use of its products.

                              RESULTS OF OPERATIONS

REVENUES AND GROSS PROFIT. The Company did not book any revenues for the quarter
ended March 31, 2001. The Company does not anticipate booking significant
revenues in the near future as it continues to focus on getting products to
market. By comparison, in the same period of 2000, the Company booked revenues
of $7,620 from isolated sales of the Company's skin care products, the result of
which was a gross profit for that period of $5,109.

OPERATING EXPENSES AND OPERATING LOSS. The Company did not spend any funds on
research and development during the quarter ended March 31, 2001, nor during the
quarter ended March 31, 2000. The lack of spending on research and development
reflects a lack of funding. The Company's general and administrative expenses
increased in the first quarter of 2001 to $85,365, as compared with $49,559
during the quarter ended March 31, 2000. This increase was due primarily to
higher travel, salary, accounting and legal expenses as the Company strengthens
its management infrastructure and progresses toward commercialization of key
products. As a result of the foregoing, the Company sustained an operating



                                       7
<PAGE>   8

loss of $85,365 for the quarter ended March 31, 2001, as compared with an
operating loss of $44,450 for the same period of 2000.

OTHER INCOME/EXPENSE AND NET LOSS. The Company incurred interest expenses of
$44,185 for the quarter ended March 31, 2001, as compared with $14,632 in such
expenses for the same period of 2000. The increase in interest expense reflects
the Company's need to operate on short-term, high-interest borrowings while it
continues to seek significant equity investment. In sum, the Company's net loss
for the first quarter of 2001 was $129,550, or a loss of less than $0.01 per
fully diluted share. For the quarter ended March 31, 2000, the Company sustained
a net loss of $59,082, also a loss of less than $0.01 per fully diluted share.

FUTURE EXPECTATIONS. Management expects the Company will operate at a loss for
several more years while it continues to study, gain regulatory approval of and
commercialize its technologies. If the Company is successful in raising
additional capital, the Company will likely spend more during the remainder of
2001 in research and development and general and administrative expenses, and
thereby sustain greater resulting losses, than it has in recent years.

                         LIQUIDITY AND CAPITAL RESOURCES

The Company will require significant additional funding to continue to develop,
research and seek regulatory approval of its technologies. In addition, the
Company cannot survive, even in the near term, without immediate additional
funding for operations. The Company does not currently generate any cash from
operations and has no credit facilities in place or available. Currently, the
Company is funding operations through short-term loans from shareholders and
others.

Management is seeking to raise substantial additional funds in private stock
offerings in order to meet its near-term and long-term funding requirements.
While management is optimistic that it can raise such funds, the Company has not
always been successful in doing so in recent years. Given that the Company is
still in an early development stage and does not have revenues from operations,
raising equity financing is difficult. In addition, any additional equity
financing will have a substantial dilutive effect to the Company's current
shareholders.

              CAUTIONARY STATEMENT FOR FORWARD LOOKING INFORMATION

Certain information set forth in this report contains "forward-looking
statements" within the meaning of federal securities laws. Forward looking
statements include statements concerning plans, objectives, goals, strategies,
future events, future revenues or performance, capital expenditures, and
financing needs of the Company and other information that is not historical
information. When used in this report, the words "estimates," "expects,"
"anticipates," "forecasts," "plans," "intends," "believes" and variations of
such words or similar expressions are intended to identify forward-looking
statements. Additional forward-looking statements may be made by the Company
from time to time. All such subsequent forward-looking statements, whether
written or oral and whether made by or on behalf of the Company, are also
expressly qualified by these cautionary statements.

The Company's forward-looking statements are based upon the Company's current
expectations and various assumptions. The Company's expectations, beliefs and
projections are expressed in good faith and are believed by the Company to have
a reasonable basis, including without limitation, management's examination of
historical operating trends, data contained in the Company's records and other
data available from third parties, but there can be no assurance that
management's expectations, beliefs and projections will result or be achieved or
accomplished. The Company's forward-looking statements apply only as of the date
made. The Company undertakes no obligation to publicly update or revise
forward-



                                       8
<PAGE>   9

looking statements which may be made to reflect events or circumstances after
the date made or to reflect the occurrence of unanticipated events.

There are a number of risks and uncertainties that could cause actual results to
differ materially from those set forth in, contemplated by or underlying the
forward-looking statements contained in this report. Those risks and
uncertainties include, but are not limited to, our lack of significant operating
revenue to date, our need for substantial and immediate additional capital, the
fact that we may dilute existing shareholders through additional stock
issuances, the extensive governmental regulation to which we are subject, the
fact that our technologies remain unproven, the intense competition we face from
other companies and other products, and our reliance upon potentially inadequate
intellectual property. Those risks and certain other uncertainties are discussed
in more detail in the 2000 10-KSB. There may also be other factors, including
those discussed elsewhere in this report, that may cause the Company's actual
results to differ from the forward-looking statements. Any forward-looking
statements made by or on behalf of the Company should be considered in light of
these factors.


                                     PART II
                                OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

The Company is a party to ongoing litigation with Harvest Group, L.L.C.
concerning a so-called "JV Agreement" dated as of June 28, 2000. No material
developments have occurred in that litigation since the Company filed its Annual
Report on Form 10-KSB for the fiscal year ended December 31, 2000.

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

(a)   The following exhibits are filed with this report:

None.

(b)   On January 4, 2001, the Company filed a report on Form 8-K concerning
      changes in the Company's accountant.



                                       9
<PAGE>   10

                                   SIGNATURES

      In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.

                                          MEDICAL DISCOVERIES, INC.

                                          /S/  JUDY M. ROBINETT
                                          -------------------------------------
                                          Judy M. Robinett
                                          Chief Executive Officer



Date:  May 14, 2001



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