<PAGE>   1
                                    FORM 10-Q

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

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

                  For the quarterly period ended June 30, 1999

                                       OR

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


              For the transition period from _________ to _________


                         Commission file number 0-26872


                          GELTEX PHARMACEUTICALS, INC.
             (Exact name of registrant as specified in its charter)


                DELAWARE                                  04-3136767
    (State or other jurisdiction of            (IRS Employer Identification No.)
     incorporation or organization)

           NINE FOURTH AVENUE
         WALTHAM, MASSACHUSETTS                              02451
(Address of principal executive offices)                  (Zip Code)


                                  781-290-5888
              (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 ( )

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

                CLASS                           OUTSTANDING AT JULY 28, 1999
                -----                           ----------------------------

    Common Stock, $.01 par value                         16,881,800



<PAGE>   2




                          GELTEX PHARMACEUTICALS, INC.

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                                                PAGE NO
                                                                                                                -------
<S>                                                                                                               <C>
PART I   FINANCIAL INFORMATION

         ITEM 1 Financial Statements

                Condensed Balance Sheets as of June 30, 1999 and December 31, 1998.............................    3

                Condensed Statements of Operations for the three months ended June 30, 1999 and 1998...........    4

                Condensed Statements of Operations for the six months ended June 30, 1999 and 1998.............    4

                Condensed Statements of Comprehensive Loss for the three months ended June 30, 1999 and 1998...    5

                Condensed Statements of Comprehensive Loss for the six months ended June 30, 1999 and 1998.....    5

                Condensed Statements of Cash Flows for the six months ended June 30, 1999 and 1998.............    6

                Notes to Condensed Financial Statements........................................................    7

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

         ITEM 3 Quantitative and Qualitative Disclosures About Market Risk.....................................   10


PART II  OTHER INFORMATION

         ITEM 4 Submission of Matters to a Vote of Security Holders............................................   11

         ITEM 5 Other Information..............................................................................   11

         ITEM 6 Exhibits and Reports on Form 8-K...............................................................   12

SIGNATURE......................................................................................................   13

EXHIBIT INDEX..................................................................................................   14
</TABLE>






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<PAGE>   3


                          PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

                          GELTEX PHARMACEUTICALS, INC.

                            CONDENSED BALANCE SHEETS
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                                      JUNE 30,         DECEMBER 31,
                                                                                        1999               1998
                                                                                    ------------       ------------
<S>                                                                                 <C>                <C>
ASSETS
Current assets:
    Cash and cash equivalents ..................................................    $  7,814,696       $ 30,874,900
     Marketable securities .....................................................      70,657,590         74,077,436
     Prepaid expenses and other current assets .................................       2,821,311          2,708,487
     Due from affiliates .......................................................      10,251,100         10,251,100
     Due from Joint Venture ....................................................         444,679          1,128,124
     Inventory .................................................................       3,186,113                 --
                                                                                    ------------       ------------
Total current assets ...........................................................      95,175,489        119,040,047
Long-term receivables, affiliates ..............................................         470,000            470,000
Long-term receivables ..........................................................           1,591             32,725
Property and equipment, net ....................................................       7,712,919          7,899,470
Intangible assets, net .........................................................       1,050,229            818,963
Investment in Joint Venture ....................................................       9,064,919          5,183,580
                                                                                    ------------       ------------
                                                                                    $113,475,147       $133,444,785
                                                                                    ============       ============

LIABILITIES AND STOCKHOLDERS' EQUITY:
Current liabilities:
     Accounts payable and accrued expenses .....................................    $  4,450,295          4,848,728
     Due to Joint Venture ......................................................              --          1,349,400
     Current portion of long-term obligations ..................................         840,808          2,020,614
                                                                                    ------------       ------------
Total current liabilities ......................................................       5,291,103          8,218,742
Long-term obligations, less current portion ....................................       5,206,180          5,206,180
Commitments and contingencies ..................................................              --                 --
Stockholders' equity:
     Common Stock, $.01 par value, 50,000,000 shares authorized;
     16,865,180 and 16,792,444 shares issued and outstanding
     at June 30, 1999 and December 31, 1998, respectively ......................         168,652            167,924
     Additional paid-in capital ................................................     187,104,318        186,762,715
     Deferred compensation .....................................................        (457,620)          (663,722)
     Accumulated other comprehensive (loss) income .............................        (159,819)           264,388
     Accumulated deficit .......................................................     (83,677,667)       (66,511,442)
                                                                                    ------------       ------------
Total stockholders' equity .....................................................     102,977,864        120,019,863
                                                                                    ------------       ------------

                                                                                    $113,475,147       $133,444,785
                                                                                    ============       ============
</TABLE>




    The accompanying notes are an integral part of the financial statements.




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<PAGE>   4


                          GELTEX PHARMACEUTICALS, INC.

                       CONDENSED STATEMENTS OF OPERATIONS
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                               THREE MONTHS                  SIX MONTHS
                                                                              ENDED JUNE 30,                ENDED JUNE 30,
                                                                           1999           1998           1999            1998
                                                                       -----------    -----------    ------------    ------------
<S>                                                                    <C>            <C>            <C>             <C>
Revenue:
   Collaborative Joint Venture project reimbursement ...............   $ 1,078,682    $ 3,660,169    $  2,961,596    $  5,198,819
   Contract Revenue ................................................            --             --       1,751,670              --
                                                                       -----------    -----------    ------------    ------------
Total revenue ......................................................     1,078,682      3,660,169       4,713,266       5,198,819
Costs and expenses:
   Research and development ........................................     7,046,371      4,206,588      13,890,501      11,608,472
   Collaborative Joint Venture project costs .......................     1,078,682      3,660,169       2,961,596       5,198,819
                                                                       -----------    -----------    ------------    ------------
      Total research and development ...............................     8,125,053      7,866,757      16,852,097      16,807,291
   General and administrative ......................................     1,620,449      1,406,728       3,134,576       2,573,035
                                                                       -----------    -----------    ------------    ------------
Total costs and expenses ...........................................     9,745,502      9,273,485      19,986,673      19,380,326
                                                                       -----------    -----------    ------------    ------------

Loss from operations ...............................................    (8,666,820)    (5,613,316)    (15,273,407)    (14,181,507)

Interest income, net ...............................................     1,040,236      1,023,948       2,188,337       1,591,354
Equity in net loss of Joint Venture ................................    (1,789,299)    (2,028,881)     (4,067,864)     (2,924,553)
                                                                       -----------    -----------    ------------    ------------

Net loss ...........................................................   $(9,415,883)   $(6,618,249)   $(17,152,934)   $(15,514,706)
                                                                       ===========    ===========    ============    ============

Basic and diluted net loss per share ...............................   $     (0.56)   $     (0.40)   $      (1.02)   $      (0.97)
                                                                       ===========    ===========    ============    ============
Shares used in computing basic and diluted net loss per share ......    16,854,000     16,700,000      16,844,000      16,052,000
</TABLE>


    The accompanying notes are an integral part of the financial statements.



                                      -4-
<PAGE>   5





                          GELTEX PHARMACEUTICALS, INC.

                   CONDENSED STATEMENTS OF COMPREHENSIVE LOSS
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                                 THREE MONTHS                  SIX MONTHS
                                                                                ENDED JUNE 30,                ENDED JUNE 30,
                                                                             1999           1998           1999            1998
                                                                         -----------    -----------    ------------    ------------

<S>                                                                      <C>            <C>            <C>             <C>
Net loss .............................................................   $(9,415,883)   $(6,618,249)   $(17,152,934)   $(15,514,706)
Other Comprehensive Income (Loss):
    Unrealized gain (loss) on securities held during the period ......      (270,643)           248        (424,207)         19,820
                                                                         -----------    -----------    ------------    ------------
 Comprehensive loss ..................................................   $(9,686,526)   $(6,618,001)   $(17,577,141)   $(15,494,886)
                                                                         ===========    ===========    ============    ============
</TABLE>


    The accompanying notes are an integral part of the financial statements.



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<PAGE>   6



                          GELTEX PHARMACEUTICALS, INC.

                       CONDENSED STATEMENTS OF CASH FLOWS
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                                               SIX MONTHS
                                                                                              ENDED JUNE 30,
                                                                                         1999               1998
                                                                                     ------------      -------------

<S>                                                                                  <C>               <C>
OPERATING ACTIVITIES
Net loss .......................................................................     $(17,152,934)     $ (15,514,706)
Adjustments to reconcile net loss to net cash used in operating activities:
   Depreciation and amortization ...............................................          993,010            606,647
   Equity in net loss of Joint Venture .........................................        4,067,964          2,924,553
   Compensation from issuance of stock options .................................          375,738            304,771
   Changes in operating assets and liabilities:
        Prepaid expenses and other current assets ..............................         (112,824)        (1,075,545)
        Due from Joint Venture .................................................          683,445            (85,480)
        Long-term receivables ..................................................           31,134             (1,020)
        Accounts payable and accrued expenses ..................................         (398,433)        (3,357,556)
        Amount due to Joint Venture ............................................       (1,349,400)                --
        Inventory ..............................................................       (3,186,133)                --
                                                                                     ------------      -------------
Net cash used in operating activities ..........................................      (16,048,413)       (16,198,336)


INVESTING ACTIVITIES
Purchase of marketable securities ..............................................      (13,285,856)      (170,925,547)
Proceeds from sale and maturities of marketable securities .....................       16,098,566         96,473,671
Investment in Joint Venture ....................................................       (7,949,303)        (3,586,755)
Purchase of intangible assets ..................................................         (386,997)          (238,485)
Purchase of property and equipment, net ........................................         (650,726)          (869,408)
                                                                                     ------------      -------------
Net cash used in investing activities ..........................................       (6,174,316)       (79,146,524)

FINANCING ACTIVITIES
Sale of Common Stock and warrants, net of issuance costs .......................          342,331         77,136,262
Payments on long-term obligations ..............................................       (1,179,806)          (547,538)
                                                                                     ------------      -------------
Net cash provided by (used in) financing activities ............................         (837,475)        76,588,724
Decrease in cash and cash equivalents ..........................................      (23,060,204)       (18,756,136)
Cash and cash equivalents at beginning of period ...............................       30,874,900         26,689,190
                                                                                     ------------      -------------
Cash and cash equivalents at end of period .....................................        7,814,696      $   7,933,054
                                                                                     ============      =============

Interest paid ..................................................................     $    259,720      $     180,322
</TABLE>


    The accompanying notes are an integral part of the financial statements.



                                      -6-
<PAGE>   7

                          GELTEX PHARMACEUTICALS, INC.

                     NOTES TO CONDENSED FINANCIAL STATEMENTS
                                   (UNAUDITED)

1.    BASIS OF PRESENTATION

      The accompanying unaudited condensed financial statements for the three
and six months ended June 30, 1999 and 1998 have been prepared in accordance
with generally accepted accounting principles for interim financial information
and with the instructions to Form 10-Q and Article 10 of Regulation S-X.
Accordingly, they do not include all the information and notes required by
generally accepted accounting principles for complete financial statements. In
the opinion of management, the accompanying condensed financial statements
include all adjustments, consisting of normal recurring adjustments, necessary
for a fair presentation of the financial condition, results of operations and
cash flows for the periods presented. The results of operations for the interim
period ended June 30, 1999 are not necessarily indicative of the results to be
expected for the year ended December 31, 1999.

      These financial statements should be read in conjunction with the audited
financial statements and notes thereto for the fiscal year ended December 31,
1998 included in the Company's Annual Report on Form 10-K (File Number 0-26872)
as filed with the Securities and Exchange Commission.

2.    SUBSEQUENT EVENTS

      On July 30, 1999, the Company filed a New Drug Application ("NDA") with
the U.S. Food and Drug Administration for Cholestagel(R) (colesevelam
hydrochloride), for the treatment of hypercholesterolemia, a condition
characterized by undesirably high blood cholesterol levels.

      On August 16, 1999, the Company announced that it had entered into a
definitive agreement (the "Merger Agreement") to acquire SunPharm Corporation
("SunPharm"). Under the terms of the Merger Agreement, which was approved by
each company's board of directors, each share of SunPharm preferred stock
outstanding immediately prior to the effective time of the merger will be
automatically converted into between 0.18338 and 0.21740 shares of the Company's
common stock and each share of SunPharm common stock outstanding immediately
prior to the effective time of the merger will be automatically converted into
between 0.12225 and 0.14493 shares of the Company's common stock, in each case
subject to adjustment as set forth in the Merger Agreement. Based on the
Company's closing stock price of $14.25 on August 13, 1999, the transaction will
be valued at approximately $16.5 million. The transaction is subject to approval
by SunPharm shareholders as well as other customary requirements. The
transaction is expected to be completed during the last quarter of fiscal 1999,
and will be accounted for using the "purchase accounting" method.

3.    RECLASSIFICATION

      Certain amounts from the prior year have been reclassified to conform to
the current year presentation.

4.    JOINT VENTURE AGREEMENT

      In June 1997, the Company entered into a joint venture with Genzyme
Corporation for the final development and commercialization of Renagel(R)
Capsules (the "Joint Venture"). The Company accounts for its investment in the
Joint Venture using the equity method.

     Summarized financial information regarding the Joint Venture for the three
and six months ended June 30, 1999 is as follows:

                                                 THREE MONTHS       SIX MONTHS
                                                     ENDED             ENDED
                                                 JUNE 30, 1999     JUNE 30, 1999
                                                 -------------     -------------

        Net sales..............................  $  4,121,658       $ 7,667,623
        Cost of products sold..................     1,562,361         3,077,801
        Loss from operations...................    (3,894,588)       (9,647,806)
        Net loss...............................    (3,578,598)       (8,135,729)




                                      -7-
<PAGE>   8


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

RESULTS OF OPERATIONS

THREE AND SIX MONTHS ENDED JUNE 30, 1999 AND 1998

      The Company earned revenue of $1.1 million during the three months ended
June 30, 1999 compared with $3.7 million earned during the three months ended
June 30, 1998. During the six months ended June 30, 1999, revenues earned were
$4.7 million compared with $5.2 million earned during the six months ended June
30, 1998. Under the terms of the Collaboration Agreement the Company has entered
into with Genzyme Corporation ("Genzyme") for the commercialization of
Renagel(R) (the "Joint Venture"), the Company and Genzyme are each expected to
fund the Joint Venture in an amount equal to 50% of the budgeted costs and
expenses of the project for the relevant period. Each party that incurs project
expenses, either as internal operating costs or as third party obligations, will
be reimbursed by the Joint Venture for 100% of the costs incurred. In the three
month period ended June 30, 1999, all revenue earned by the Company represents
reimbursement from the Joint Venture for certain Renagel(R) development costs
incurred by the Company. For the six month period ended June 30, 1999, $1.7
million of the total revenue earned represents non-recurring reimbursement by
the Company's Japanese partner for certain Renagel(R) process development and
manufacturing costs incurred by the Company. The remaining $3.0 million of
revenue earned in the six month period ended June 30, 1999 represents
reimbursement from the Joint Venture for certain Renagel(R) development costs
incurred by the Company. All revenue earned in the three and six month periods
ended June 30, 1998 represents reimbursement from the Joint Venture for certain
Renagel(R) development costs incurred by the Company. The amount of
reimbursement revenue earned by the Company will vary according to the
obligations of, and related expense incurred, by the Company, and is expected to
continue to decrease as the Company completes the development activities for the
Joint Venture.

      The Company's total operating expenses for the three months ended June 30,
1999 increased by $0.4 million to $9.7 million from $9.3 million during the same
period in 1998. The Company's total operating expenses were $20.0 million and
$19.4 million for the six months ended June 30, 1999 and 1998, respectively.
Research and development expenses increased by $0.2 million to $8.1 million for
the three month period ended June 30, 1999 from $7.9 million for the period
ended June 30, 1998. For the six months ended June 30, 1999 and 1998, research
and development expenses were $16.8 million. The relatively flat research and
development expense is due to the decrease in the development activities for the
Joint Venture offset by an increase in the costs associated with the Company's
other research programs. The Company expects its research and development
expenses to increase in connection with the continuing development of processes
for the manufacture of commercial quantities of Cholestagel, the expansion of
the anti-obesity, infectious diseases and other research and development
programs, and with the research and development activities associated with the
SunPharm acquisition. General and administrative expenses increased $0.2 million
to $1.6 million for the three months ended June 30, 1999 from $1.4 million for
the same period a year ago. During the six month period ended June 30, 1999,
general and administrative expenses increased to $3.1 million from $2.6 million
during the same period in 1998. The increase was due primarily to increased
business development and increased administrative personnel costs.

      The Company's equity in the net loss of the Joint Venture with Genzyme
Corporation was $1.8 million and $2.0 million for the three month periods ended
June 30, 1999 and 1998, respectively. For the six month periods ended June 30,
1999 and 1998, the Company's equity in the net loss of the Joint Venture was
$4.1 million and $2.9 million, respectively. These costs represent the Company's
portion of the Joint Venture loss for the relevant periods and reflect the
increased costs associated with the commercial launch of Renagel(R). The Company
expects that the Joint Venture will continue to operate at a loss at least into
2000.

      Net interest income remained constant at $1.0 million for the three months
ended June 30, 1999 and 1998. For the six month period ended June 30, 1999 and
1998, net interest income was $2.2 million and $1.6 million, respectively. The
increase was due primarily to net higher average cash balances during the six
month period in 1999.

LIQUIDITY AND CAPITAL RESOURCES

      As of June 30, 1999, the Company had $78 million in cash, cash equivalents
and marketable securities as compared to $105 million at December 31, 1998. The
Company believes that its existing cash balances and marketable securities will
be sufficient to fund its operations through at least 2001.

      On October 21, 1998, the Company entered into a synthetic lease
transaction under which the lessor has committed to fund up to an aggregate of
$25.0 million for the purchase of a new building to serve as the Company's new
headquarters and for the costs




                                      -8-
<PAGE>   9

associated with the build-out of this facility. The synthetic lease is
asset-based financing structured to be treated as an operating lease for
accounting purposes. The Company is serving as construction agent for the
lessor. At June 30, 1999, the lessor's total accumulated cost for the land and
the partial build-out of the facility was approximately $15.3 million. Under the
terms of the synthetic lease, the Company is required to comply with certain
financial covenants which, among other things, require the maintenance of
minimum levels of cash, tangible net worth, liquidity and debt service coverage
and prohibits the payment of dividends. The Company was in compliance with these
terms at June 30, 1999.

      In August 1999, the Company entered into a Purchase and Sale Agreement to
acquire a building and land adjacent to the Company's new headquarters. The
purchase, which is contingent upon the favorable outcome of certain due
diligence to be conducted by the Company throughout the month of August is
expected to close in the third quarter of 1999. The Company expects to secure
financing sufficient to fund $3.0 million of the $3.2 million purchase price
through an amendment to its existing long-term debt agreement.

      The Company is in negotiations with a financial institution to establish a
$5.0 million lease line to finance the cost of equipment purchases. It is
expected that the line will be drawn down for purchases and will be repaid in 48
equal monthly installments commencing in July 2000.

      The Company has agreed in principle to the terms of a manufacturing
agreement with its contract manufacturer for the production of bulk inventory
for Cholestagel. The Company will be obligated under the terms of the agreement
to pay approximately 352.1 million Austrian schillings (approximately $27.6
million as of June 30, 1999) through 2000. The Company is proceeding with
payments to the manufacturer, and as of June 30, 1999 has paid approximately
$3.1 million.

YEAR 2000

      The Year 2000 problem is a result of software programs being written using
two digits rather than four to define the applicable year. The Company
recognizes the risk that its information technology ("IT") systems and other
systems such as telephones, building access control systems and heating and
ventilation equipment ("embedded systems") may have date-sensitive software or
embedded chips that may recognize a date using "00" as the year 1900 rather than
the year 2000. This error could result in system failure or miscalculations
causing disruptions to the Company's research and development, financial,
administration and communication operations. The Company also has business
relationships with third parties that are themselves reliant on IT and embedded
systems to conduct their businesses. The Company recognizes the need to ensure
its operations will not be adversely impacted by Year 2000 software and hardware
failure both internally and from third parties with which the Company has an
important relationship.

      In 1998, the Company developed a plan to ensure that its systems would be
Year 2000 compliant. The plan consists of four phases: (1)
assessment--identifying all IT systems that use date functions and assessing
Year 2000 functionality and compliance, (2) remediation-- reprogramming or
replacing inventoried items to ensure Year 2000 compliance, (3) testing--
testing the code modifications or new inventory with other associated systems,
including date testing and quality assurance to ensure successful operation in
the post-1999 environment, and (4) implementation--returning all remediated and
successfully tested items back into normal operation. This plan encompasses IT
and embedded systems, as well as third party exposure.

The Company's State of Readiness

    As of December 31, 1998, the Company had completed all four phases of the
plan for its IT systems and has concluded that its IT systems are Year 2000
compliant. The assessment phase for the embedded systems is complete. The
assessment indicated that certain embedded systems are not Year 2000 compliant.
The Company will complete the remaining three phases of testing for these
non-compliant embedded systems by December 1999. The cost of remediating these
non-compliant embedded systems will be approximately $100,000 and will be funded
from available cash.

Third Parties and Their Exposure to Year 2000

    The Company has continued formal communications with all significant third
parties, primarily, clinical trial sites, contract research organizations and
contract manufacturers. The Company has requested and has received from a
majority of these third parties, written statements regarding their knowledge of
and plans for being Year 2000 compliant. The Company has one direct system
interface with a third party and has received verification that the system
interface is Year 2000 compliant.




                                      -9-
<PAGE>   10




Contingency Plans

    The Company has not yet developed a comprehensive contingency plan to
address situations that may result if the Company or any of the third parties
upon which the Company is dependent are unable to achieve Year 2000 readiness.
However, the Company's Year 2000 compliance program is ongoing and its scope,
including the development of contingency plans for the most reasonably likely
worst case scenario, will continue to be evaluated.

Risks

    The Company's management believes it has an effective plan in place to
mitigate the risks of the Year 2000 issue in a timely manner. However, as noted
above, the Company has not yet completed all necessary phases of its Year 2000
plan. In the event that the Company is not able to complete the necessary
phases, the Company could experience business interruptions. In addition, the
inability of a third party upon which the Company is dependent to complete its
Year 2000 compliance program in a timely manner, as well as disruptions in the
general economy resulting from the Year 2000 issue could have a material adverse
impact on the Company's results of operations, liquidity or financial position.

ITEM 3.    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

    Market risks were reported in the Notes to the Financial Statements for the
Company's Annual Report on Form 10-K for the year ended December 31, 1998. There
have been no material changes in these risks since the end of the year.




                                      -10-
<PAGE>   11



                           PART II. OTHER INFORMATION

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

    The Company's 1999 Annual Meeting of Stockholders was held May 27, 1999. The
following is a description of the three matters submitted to a vote of the
stockholders at such meeting and the results of voting.

    (i)   At the meeting a director was elected to serve on the Company's Board
          of Directors.

                                              Number of Shares
                            Number of Shares    Voted Against       Number of
          Director Elected     Voted For         Or Withheld    Shares Abstained
        ------------------  ----------------  ----------------  ----------------
        Robert J. Carpenter    12,879,601           219,470          10,177

    There were no broker non-votes with respect to this matter.

    The following directors' terms of office as directors continued after the
meeting: Mark Skaletsky, J. Richard Crout, Henri Termeer and Jesse Treu.

    (ii)  The Stockholders also approved an amendment to the Company's 1992
          Equity Incentive Plan to increase the number of shares of Common
          Stock reserved under such plan from 2,750,000 to 3,350,000.

                Number of Shares Voted For:                          12,424,418
                Number of Shares Voted Against or Withheld:             664,476
                Number of Shares Abstained:                              10,177

    There were no broker non-votes with respect to this matter.

    (iii) The Stockholders also approved an amendment to the Company's 1995
          Director Stock Option Plan to increase the number of shares of Common
          Stock reserved for issuance under this Plan from 110,000 to 150,000.

                Number of Shares Voted For:                          12,935,568
                Number of Shares Voted Against or Withheld:             152,666
                Number of Shares Abstained:                              10,837

    There were no broker non-votes with respect to this matter.

ITEM 5.    OTHER INFORMATION

    On August 16, 1999, the Company announced that it had entered into a
definitive agreement (the "Merger Agreement") to acquire SunPharm Corporation
("SunPharm"), a development stage biotechnology company. SunPharm is focused on
the development of small molecule pharmaceutical products, consisting of novel
polyamine analogue and metal chelator compounds. SunPharm's drug development
efforts are focused on cancer, refractory diarrhea associated with acquired
immunodeficiency syndrome, other gastrointestinal disorders, and iron overload.

    Under the terms of the Merger Agreement, which was approved by each
company's board of directors, each share of SunPharm preferred stock outstanding
immediately prior to the effective time of the merger will be automatically
converted into between 0.18338 and 0.21740 shares of the Company's common stock
and each share of SunPharm common stock outstanding immediately prior to the
effective time of the merger will be automatically converted into between
0.12225 and 0.14493 shares of the Company's common stock, in each case subject
to adjustment as set forth in the Merger Agreement. Based on the Company's
closing stock price of $14.25 on August 13, 1999, the transaction will be
valued at approximately $16.5 million. The transaction is subject to approval by
SunPharm shareholders as well as other customary requirements. The transaction
is expected to be completed during the last quarter of fiscal 1999, and will be
accounted for using the "purchase accounting" method. Attached and incorporated
herein by reference in its entirety as Exhibit 10.3 is a copy of the Merger
Agreement.



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<PAGE>   12

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

           (a)   Exhibits.

                 See the Exhibit Index on page 14 hereto.

           (b)   Reports on Form 8-K.

                 None.




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<PAGE>   13




                          GELTEX PHARMACEUTICALS, INC.
                                    FORM 10-Q

                                  JUNE 30, 1999

                                    SIGNATURE

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


                                             GELTEX PHARMACEUTICALS, INC.

DATE: August 16, 1999                         BY: /s/ Paul J. Mellett, Jr.
                                                 -------------------------------
                                                 Paul J. Mellett, Jr.
                                                 Duly Authorized  Officer and
                                                 Principal Financial Officer







                                      -13-
<PAGE>   14







                                  EXHIBIT INDEX



EXHIBIT NUMBER                     DESCRIPTION
--------------                     -----------

     10.1#         Amended and restated 1992 Equity Incentive Plan.

     10.2#         Amended and restated 1995 Director Stock Option Plan.

     10.3*         Agreement and Plan of Merger dated as of August 13, 1999
                   among GelTex Pharmaceuticals, Inc., SunPharm Corporation, and
                   Shine Acquisition Sub., Inc.

     10.4          Purchase and Sale Agreement between Barry L. Solar and Robert
                   L. Solar as Trustees of 211 Second Avenue Realty Trust and
                   the Company dated as of July 26, 1999.

     27.1          Financial Data Schedule

------------------


# Identifies a management contract or compensatory plan or arrangement in which
  an executive officer or director of the Company participates.

* Pursuant to Item 601(b)(2) of Regulation S-K, the Schedules to the Merger
  Agreement are omitted. A list of such schedules appears in the Merger
  Agreement. The Company hereby undertakes to furnish supplementally a copy
  of any omitted schedule to the Commission upon request.








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