<PAGE>

===============================================================================

                                  UNITED STATES
                       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 September 30, 2001

                                      -OR-

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

                     For the transition period from...to...

                          Commission File No. 333-36379

                        PACIFICHEALTH LABORATORIES, INC.
               (Exact name of issuer as specified in its charter)


             DELAWARE                                          22-3367588
     (State or other jurisdiction of                         (I.R.S. Employer
     incorporation or organization)                      Identification Number)

      1480 Route 9 North, Suite 204
      Woodbridge, NJ                                              07095
     (Address of principal executive offices)                  (Zip Code)


      Registrant's telephone number, including area code:  (732) 636-6141


Check whether the issuer (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 [_]

At November 9, 2001 there were 6,039,203 shares of common stock, par value
$.0025 per share, of the registrant outstanding.

Transitional small business disclosure format: Yes  [ ] No [X]


<PAGE>

                        PACIFICHEALTH LABORATORIES, INC.

                                TABLE OF CONTENTS
                                -----------------


PART I.   FINANCIAL INFORMATION

     ITEM 1.   FINANCIAL STATEMENTS

               Balance Sheets as of September 30, 2001 (Unaudited)
                    and December 31, 2000................................. 3

               Statements of Operations (Unaudited) for the three and nine
                    months ended September 30, 2001 and 2000.............. 4

               Statements of Cash Flows (Unaudited) for the nine months
                    ended September 30, 2001 and 2000..................... 5

               Notes to Financial Statements.............................. 6

     ITEM 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                    CONDITION AND RESULTS OF OPERATIONS................... 8

PART II.  OTHER INFORMATION

     ITEM 2.   Changes in Securities and Use of Proceeds.................. 11

     ITEM 6.   Exhibits and Reports....................................... 11


SIGNATURES................................................................ 11



                                       2
<PAGE>
                        PACIFICHEALTH LABORATORIES, INC.
                                 BALANCE SHEETS

                                     ASSETS
<TABLE>
<CAPTION>
                                                                             September 30,             December 31,
                                                                                  2001                     2000
                                                                              (Unaudited)                (Audited)
                                                                             ------------              ------------
<S>                                                                          <C>                       <C>
Current assets:
  Cash and cash equivalents                                                  $  2,552,629              $    170,491
  Accounts receivable, net                                                        777,650                   441,396
  Inventories                                                                   2,304,745                 1,652,693
  Prepaid expenses                                                                127,377                   162,466
                                                                             ------------              ------------
       Total current assets                                                     5,762,401                 2,427,046

Property and equipment, net                                                        59,678                    74,043

Other assets:
  Deposits                                                                        153,991                    53,991
                                                                             ------------              ------------

            Total assets                                                     $  5,976,070              $  2,555,080
                                                                             ============              ============

                          LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
  Notes payable                                                              $     13,081              $     47,741
  Accounts payable and accrued expenses                                           695,575                   735,377
                                                                             ------------              ------------
        Total current liabilities                                                 708,656                   783,118
                                                                             ------------              ------------

Stockholders' equity:
  Common stock, $.0025 par value; authorized 10,000,000
    shares; issued and outstanding: 4,646,367 shares at
    December 31, 2000 and 5,989,203 shares at September 30, 2001                   14,973                    11,616
  Additional paid-in capital                                                   13,334,033                11,060,246
  Accumulated deficit                                                          (8,081,592)               (9,299,900)
                                                                             ------------              ------------
                                                                                5,267,414                 1,771,962
                                                                             ------------              ------------

            Total liabilities and stockholders' equity                       $  5,976,070              $  2,555,080
                                                                             ============              ============
</TABLE>

                                       3
<PAGE>

                        PACIFICHEALTH LABORATORIES, INC.
                            STATEMENTS OF OPERATIONS
     FOR THE THREE MONTHS AND NINE MONTHS ENDED SEPTEMBER 30, 2001 AND 2000
                                   (UNAUDITED)
<TABLE>
<CAPTION>
                                                               Three Months                               Nine Months
                                                            Ended September 30,                       Ended September 30,
                                                            -------------------                       -------------------
                                                          2001                2000                 2001                 2000
                                                          ----                ----                 ----                 ----
<S>                                                   <C>                  <C>                  <C>                  <C>
Revenues:
   Product sales                                      $ 1,328,560          $ 1,503,541          $ 4,800,252          $ 3,337,138
   Licensing revenues                                        --                   --              1,000,000                 --
                                                      -----------          -----------          -----------          -----------
                     Total Revenues                     1,328,560            1,503,541            5,800,252            3,337,138

Cost of goods sold                                        589,998              676,427            2,321,267            1,462,085
                                                      -----------          -----------          -----------          -----------

Gross Profit                                              738,562              827,114            3,478,985            1,875,053

Selling, general and administrative expenses              702,764              725,167            2,173,475            2,148,783
Research & development                                     22,611               69,456               73,454              186,005
Amortization expense                                         --                   --                   --                    928
Depreciation expense                                       11,161               10,533               33,585               28,960
Provision for replacement of product                         --                   --                   --                (35,000)
                                                      -----------          -----------          -----------          -----------
                                                          736,536              805,156            2,280,514            2,329,676
                                                      -----------          -----------          -----------          -----------

Net operating income (loss)                                 2,026               21,958            1,198,471             (454,623)

Other income (expense)
   Interest income (expense)                               17,688                6,033               19,837               43,655
                                                      -----------          -----------          -----------          -----------

Income (loss) before income taxes                          19,714               27,991            1,218,308             (410,968)

Provision for income taxes                                   --                   --                   --                   --
                                                      -----------          -----------          -----------          -----------

Net income (loss)                                     $    19,714          $    27,991          $ 1,218,308          $  (410,968)
                                                      ===========          ===========          ===========          ===========

Basic income (loss) per share                         $      0.00          $      0.01          $      0.23          $     (0.09)
                                                      ===========          ===========          ===========          ===========

Diluted income (loss) per share                       $      0.00          $      0.01          $      0.20          $     (0.09)
                                                      ===========          ===========          ===========          ===========

Weighted average common shares:
     Basic                                              5,898,070            4,641,041            5,279,649            4,597,790
                                                      ===========          ===========          ===========          ===========

     Diluted                                            7,311,663            4,716,604            6,205,688            4,788,753
                                                      ===========          ===========          ===========          ===========
</TABLE>

                                       4
<PAGE>

                        PACIFICHEALTH LABORATORIES, INC.
                             STATEMENT OF CASH FLOWS
              FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2001 AND 2000
                                   (UNAUDITED)
<TABLE>
<CAPTION>
                                                                                2001                  2000
                                                                            -----------           -----------
<S>                                                                           <C>                    <C>
Cash flows from operating activities:
   Net income (loss)                                                        $ 1,218,308           $  (410,968)
   Adjustments to reconcile net income (loss)
     to net cash used in operating activities:
        Depreciation                                                             33,585                28,960
        Amortization                                                               --                     928
        Intrinsic value of non-employee stock options granted                   182,071                43,055
     Changes in assets and liabilities:
        (Increase) / Decrease in accounts receivable                           (336,254)             (126,014)
        (Increase) / Decrease in inventories                                   (652,052)           (1,069,426)
        (Increase) / Decrease in prepaid expenses                                35,089                42,342
        (Increase) / Decrease in other assets                                  (100,000)              (50,928)
        Increase / (Decrease) in accounts payable/accrued expenses              (39,802)              291,768
        Decrease in reserve for product replacement                                --                 (80,489)
                                                                            -----------           -----------
Net cash provided by (used in) operating activities                             340,945            (1,330,772)
                                                                            -----------           -----------


Cash flows from investing activities:
     Purchase of fixed assets                                                   (19,220)              (25,304)
                                                                            -----------           -----------
Net cash used in investing activities                                           (19,220)              (25,304)
                                                                            -----------           -----------

Cash flows from financing activities:
     Repayments of notes payable                                                (34,660)                 --
     Common stock issued                                                      1,500,000                  --
     Common stock options/warrants exercised                                    595,073               160,000
                                                                            -----------           -----------
Net cash provided by financing activities                                     2,060,413               160,000
                                                                            -----------           -----------

Net increase (decrease) in cash                                               2,382,138            (1,196,076)

Cash, beginning balance                                                         170,491             1,742,360
                                                                            -----------           -----------

Cash, ending balance                                                        $ 2,552,629           $   546,284
                                                                            ===========           ===========
</TABLE>

                                       5
<PAGE>
                        PACIFICHEALTH LABORATORIES, INC.
                          NOTE TO FINANCIAL STATEMENTS
     FOR THE THREE MONTHS AND NINE MONTHS ENDED SEPTEMBER 30, 2001 AND 2000
                                   (UNAUDITED)


1. Basis of Presentation:

      The accompanying unaudited financial statements have been prepared in
      accordance with generally accepted accounting principles for interim
      financial information and with the instructions for Form 10-QSB and Item
      310 of Regulation S-B. Accordingly, they do not include all of the
      information and footnotes required by generally accepted accounting
      principles for complete financial statements. In the opinion of
      management, all adjustments (consisting of normal recurring accruals)
      considered necessary for a fair presentation have been included. Operating
      results for the three months and nine months ended September 30, 2001 are
      not necessarily indicative of the results that may be expected for the
      year ending December 31, 2001. The unaudited financial statements should
      be read in conjunction with the financial statements and footnotes thereto
      included in the Company's annual report on Form 10-KSB for the year ended
      December 31, 2000.

2. Inventories

      As of September 30, 2001 and December 31, 2000, inventories consist of
      the following:

                                           2001                     2000
                                           ----                     ----

      Raw Materials                    $   419,371               $  194,647
      Work-in-process                       23,117                  311,475
      Finished goods                     1,862,257                1,146,571
                                      ------------               ----------

                                      $  2,304,745               $1,652,693
                                      ============               ==========

      The above inventory balances as of September 30, 2001 are net of
      reserves for potential excess quantities and obsolescence of approximately
      $ 40,117.

3. Stock Based Compensation

      The Company granted 771,500 Incentive Stock Options (ISOs) to employees
      during the first nine months of 2001. 225,000 options vested upon grant
      with an exercise price of $1.00, and 546,500 vest during the first six
      months of 2002 with exercise prices ranging from $0.313 per share to $4.75
      per share. 225,000 options issued to employees expired during the first
      nine months of 2001. The Company, per Dr. Portman's 2001 Employment
      Agreement, also re-priced the grant of options issued under his 1998
      Employment Agreement to purchase up to 475,000 shares of Common Stock,
      from $6.00 to $0.313 per share. These options vested immediately and were
      exercised in full during the second quarter 2001. The exercise price for
      all 1,246,500 options was equal to the fair market value of the common
      stock on the date of grant. Since the Company accounts for its options
      under APB No. 25, no compensation expense was recognized.

      The Company also granted 352,500 stock options to consultants during the
      first nine months of 2001. 267,500 options vested upon grant with exercise
      prices ranging from $0.50 per share to $3.85 per share, 30,000 options
      vest during the first quarter 2002 with an exercise price of $0.313 per
      share, 25,000 options vest during the second quarter 2002 with an exercise
      price of $1.00 per share, 5,000 options vest during the third quarter 2002
      with an exercise prices ranging from $4.29 per share to $6.30 per share,
      and 25,000 options vest during the second quarter 2003 with an exercise
      price of $1.00 per share. 11,500 options issued to consultants expired
      during the first nine months of 2001 and 195,000 options issued to
      consultants were cancelled during the first nine months of 2001. These
      options and warrants were determined to have a value of $182,071 for the
      nine months ended September 30, 2001. These amounts were charged to
      operations in the nine months ended September 30, 2001 and added to
      paid-in capital in accordance with SFAS 123.

                                       6
<PAGE>

4. Income Taxes

      The Company has approximately $8,900,000 in Federal net operating loss
      carryovers that were generated through December 31, 2000 and are available
      to offset future taxable income in calendar years 2001 through 2013.
      Accordingly, this amount has been reduced by Federal taxable income of
      approximately $1,200,000 during 2001 resulting in a remaining Federal net
      operating loss of $7,700,000 as of September 30, 2001.

      The components of the Company's deferred tax assets as of September 30,
      2001 and December 31, 2000 are as follows:

                                                  2001              2000
                                                  ----              ----

      Net operating loss carry forwards       $ 2,780,000       $ 3,215,000
      Valuation allowance                      (2,780,000)       (3,215,000)
                                              -----------       -----------

      Deferred tax asset                      $      -          $      -





                                       7
<PAGE>

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

         This discussion contains forward-looking statements, which we have made
pursuant to the safe-harbor provisions of the Private Securities Litigation
Reform Act of 1995. Forward-looking statements reflect our current views with
respect to such future events. Actual results may vary materially and adversely
from those anticipated, believed, estimated or otherwise indicated. Factors that
could cause actual results to differ adversely include, without limitation,
unexpected laboratory results in clinical research studies, inability to secure
targeted product endorsers, and timing differences between the scheduled and
actual launch date of new products. We do not undertake to update any
forward-looking statement that may be made from time to time by us or on our
behalf.


(a)      Introduction

         The Company was incorporated in April 1995 as a nutrition technology
company that researches, develops, and commercializes functionally unique
proprietary products for sports performance, weight loss and Type 2 diabetes.

         Sports Performance
         Our first sports performance product, ENDUROX(R), was introduced in
March 1996 with commercial sales beginning in May 1996. In March 1997, we
extended the ENDUROX line of products with ENDUROX EXCEL(R). In February 1999,
we introduced ENDUROX(R) R4(R) Performance/Recovery Drink to be taken following
exercise. In clinical studies, ENDUROX R4 has demonstrated a number of
exercise-related benefits including enhanced performance, extended endurance,
and decreased post-exercise muscle damage. In June 2001, we introduced
ACCELERADE(R) Sports Drink, to be taken during exercise using the same patented
technology as ENDUROX R4. Research studies have shown that ACCELERADE is
significantly better than conventional sports drinks in improving endurance
during exercise.

         Weight Loss
         In weight loss, the Company has focused its research and development
efforts on development of novel nutritional compositions that stimulate the
body's major satiety peptide, or cholecystokinin (CCK). In April 2000, we
introduced our first weight loss product, SATIETROL(R), a natural appetite
control product based on this research. Clinical studies have shown that
Satietrol, a pre meal beverage, can reduce hunger up to 43% 3 1/2 hours after
eating. In January 2001, we extended our weight loss product line with the
introduction of SATIETROL COMPLETE(R), a 220-calorie meal replacement product
that incorporates the patented SATIETROL technology. In June 2001, the Company
signed an exclusive worldwide Licensing Agreement with GlaxoSmithKline ("GSK")
for its SATIETROL technology.

         Type 2 Diabetes
         Type 2 diabetes has become the fastest growing chronic condition in the
United States. Obesity and poor glucose regulation appear to be primary
characteristics of this condition. Research has suggested that cholecystokinin
(CCK) may play a role in insulin release and glucose regulation. The Company's
research in this area is to develop a nutritional product that can help Type 2
diabetics lose weight by controlling appetite while improving glucose
regulation. The Company expects to initiate clinical trials on a product for use
by Type 2 diabetics in 2002.

                                       8
<PAGE>

(b) Results of Operations - Three Months and Nine Months Ended September 30,
2001 vs. September 30, 2000

         We recorded net income of $19,714 or $0.00 per share for the three
months ended September 30, 2001, compared to net income of $27,991 or $0.01 per
share for the three months ended September 30, 2000. We recorded net income of
$1,218,309 or $0.20 per share for the nine months ended September 30, 2001,
compared to a loss of $410,968 or $0.09 per share for the nine months ended
September 30, 2000. The net income for the nine-month period ended September 30,
2001 vs. the net loss for the same period in 2000 is due primarily to increased
revenues. We also reduced our reserve for product replacement by $35,000 in the
nine months ended September 30, 2000, taking this amount back into income as
described below.

         Revenues in the three months ended September 30, 2001, were $1,328,560
compared to $1,503,541 for the same period in 2000. Sales of ENDUROX R4
increased 34% for the three months ended September 30, 2001 compared to the same
period in 2000. ACCELERADE, the Company's new generation of sports drink
launched in June 2001, continued to contribute significant revenues for the
Company in the third quarter 2001. This was offset by a decrease in sales of
SATIETROL for the three months ended September 30, 2001 compared to the same
period in 2000. SATIETROL was rolled out nationally in August 2000 resulting in
large initial pipeline sales in the third quarter 2000. Revenues for the nine
months ended September 30, 2001, were $5,800,252 compared to $3,337,138 for the
same period in 2000, a 74% increase. Revenue increases for the nine-month period
ended September 30, 2001 were due primarily to substantial increases in sales of
our current products, the introduction of ACCELERADE Sports Drink, and the
signing of a License Agreement with GSK for our SATIETROL natural appetite
control technology which included an initial payment of $1,000,000. Sales of
ENDUROX R4 increased 52% and sales of SATIETROL increased 18% in the nine-month
period ended September 30, 2001 compared to the same period in 2000.

         Gross profit margin on product sales was 55.6% for the three months
ended September 30, 2001 compared to 55.0% for the three months ended September
30, 2000. Gross profit margin on product sales was 51.6% for the nine months
ended September 30, 2001 compared to 56.2% for the nine months ended September
30, 2000. The primary reasons for the decline in gross profit margin on product
sales for the nine months ended September 30, 2001 compared to the same period
in 2000 were sales discounts given to new customers to increase distribution of
our products and payment discounts offered to customers to accelerate cash flow.
Sales discounts offered to new customers as a means to attract new distribution
may continue as we seek to expand our sales base. Payment discounts were offered
in the first half of 2001 in order to accelerate collection of large
receivables. Payment discounts stopped in the second quarter as the Company is
now in a stronger cash position.

         During the second quarter 2001, the Company entered into an exclusive
license agreement with GSK, one of the world's largest pharmaceutical companies,
for SATIETROL, the Company's appetite control product. The agreement provides
GSK with worldwide rights to the trademarks, technology, patents, and know how
for SATIETROL. Under the agreement, PHLI received an initial payment of
$1,000,000, will receive additional achievement payments over the next two years
provided GSK meets certain development goals, and will receive ongoing product
royalties upon launch of the product by GSK. The Company can continue to sell
the SATIETROL line of products until GSK launches their SATIETROL product. At
that time, the Company can continue to market the powdered meal replacement
product, currently sold under the name SATIETROL COMPLETE(R), without using the
Satietrol(R) name, in the current health food store channels of distribution.
GSK will be responsible for future manufacturing, marketing, and sales upon
launch by GSK. GSK also purchased approximately 9% of PHLI's common stock for
$1.5 million.

                                       9
<PAGE>

         Selling, general, and administrative ("S, G, & A") expenses decreased
to $702,765 for the three-month period ended September 30, 2001 from $725,167
for the three-month period ended September 30, 2000. This decrease is due
primarily to a decrease in advertising expenses that were higher in the third
quarter 2000 to support the national rollout of SATIETROL. S, G, & A expenses
increased to $2,173,475 for the nine-month period ended September 30, 2001 from
$2,148,783 for the nine-month period ended September 30, 2000 due primarily to
an increase in consulting expenses.

         Research and development expenses decreased to $22,611 for the three
months ended September 30, 2001 from $69,456 for the three months ended
September 30, 2000. The primary reason for the reduction in research and
development expenses for this period was that in the third quarter 2000 we
conducted several SATIETROL COMPLETE and ACCELERADE clinical trials in support
of the product launches of these products. No such clinical trials were
conducted in the third quarter 2001. Research and development expenses decreased
to $73,454 for the nine months ended September 30, 2001 from $186,005 for the
nine months ended September 30, 2000. The primary reason for the reduction in
research and development expenses for the nine-month period ended September 30,
2001 compared to the same period in 2000 was that in the first nine months of
2000, several SATIETROL clinical trials were conducted in anticipation of the
launch of the product in the second quarter of 2000. No such clinical trials
were conducted in the first nine months of 2001. We anticipate research and
development expenses will increase and exceed the levels of 2000 as additional
clinical trials are conducted on all of our products as we continue to seek out
additional patents and claims for our products.

         In 1997, we reformulated our original ENDUROX product into a caplet,
rather than a capsule, because the capsule form was very hygroscopic and became
altered in size and color in conditions of high heat and humidity. At June 30,
1997 we estimated a reserve for charges resulting from exchanging our retailers'
inventory of capsules for caplets or issuing a credit refund for returned
capsules. At the end of each quarter, we compare the reserve's balance to a
current estimate of capsule exchange/credit refund exposure. At September 30,
2000, we estimated that our remaining capsule exchange for caplets and/or credit
refunds would not exceed $80,573. As a result, we reduced our reserve by $35,000
and offset our net loss for the nine months ended September 30, 2000 by taking
that amount back into income. This reserve was completely written off by
December 31, 2000.

(c) Liquidity and Capital Resources

         At September 30, 2001, the Company's current assets exceeded its
current liabilities by approximately $5.05 million with a ratio of current
assets to current liabilities of approximately 8.1 to 1. Cash increased
primarily because of our higher revenues and net income for the nine months
ended September 30, 2001, and the aforementioned purchase by GSK of
approximately 9% of the Company's stock. Accounts receivable was higher at
September 30, 2001 compared to December 31, 2000 due to our higher revenues.
Inventory levels were higher at September 30, 2001 as compared to December 31,
2000 due to higher actual and anticipated sales levels for most products and
also due to lower than anticipated SATIETROL sales.

                                       10
<PAGE>
         Based on our current plans and level of operations, we do not see a
need for additional cash in the next twelve months.


PART II     OTHER INFORMATION


ITEM  2.     CHANGES IN SECURITIES AND USE OF PROCEEDS

             (a), (b) Changes in Securities:  None

             (c)   Sales of Unregistered Securities:  None


ITEM 6.      EXHIBITS AND REPORTS ON FORM 8-K

(a) Exhibits:

         None.

(b) Reports on Form 8-K:

         On June 14, 2001, the Company filed a Current Report on Form 8-K dated
June 1, 2001, reporting, under Item 5, the License Agreement and investment by
GSK. That report included an unaudited balance sheet as of April 30, 2001 and an
unaudited Statement of Operations for the four months ended April 30, 2001, with
pro forma adjustments showing the effect of the initial license fee and
investment proceeds, as if they had been paid as of April 30, 2001.

         On July 5, 2001, we filed an amendment to this 8-K, for the purpose of
filing the License Agreement as Exhibit 4.1, with portions redacted pursuant to
a request for confidential treatment.


                                   SIGNATURES

         Pursuant to the requirements of Section 13 or 15(d) 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.


                                             PACIFICHEALTH LABORATORIES, INC.


                                             By: /S/ STEPHEN P. KUCHEN
                                                 ------------------------------
                                                 STEPHEN P. KUCHEN

                                              Vice President
                                              (Principal Financial
                                              Officer and Principal Accounting
                                              Officer)

                                              Date: NOVEMBER 9, 2001
                                                    ---------------------------