SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549

                                    FORM 10-Q



[X] Quarterly report pursuant to section 13 or 15(d) of the Securities Exchange
                                  Act of 1934

                       For the quarter ended June 30, 1999

                                       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 NUMBER 000-23531



                                 AGRITOPE, INC.

             (Exact name of Registrant as specified in its charter)


        DELAWARE                                         93-0820945
(State of incorporation)                    (I.R.S. Employer Identification No.)

16160 SW Upper Boones Ferry Road
        Portland, Oregon                                       97224-7744
(Address of principal executive offices)                       (Zip code)

                                  (503) 670-7702
              (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 [ ]

     Number of shares of Registrant's Common Stock, $.01 par value, outstanding
as of July 31, 1999: 4,069,858



<PAGE>

                                 AGRITOPE, INC.

                          PART I. FINANCIAL INFORMATION

                                                                        PAGE NO.
                                                                        --------
ITEM 1.  CONDENSED CONSOLIDATED FINANCIAL STATEMENTS


    AGRITOPE, INC. AND SUBSIDIARIES

    Condensed Consolidated Balance Sheets
        as of September 30, 1998 and June 30, 1999...............          2

    Condensed Consolidated Statements of Operations
        for the three months and nine months ended
        June 30, 1999 and 1998...................................          3

    Condensed Consolidated Statements of Changes in Stockholders' Equity
        for the nine months ended June 30, 1999..................          4

    Condensed Consolidated Statements of Cash Flows
        for the nine months ended June 30, 1999 and 1998.........          5

    Notes to Condensed Consolidated Financial Statements.........          6


ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
    AND RESULTS OF OPERATIONS ...................................          7

                           PART II. OTHER INFORMATION


ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K........................         11









                                       1
<PAGE>



AGRITOPE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>

                                                                                    6/30/99                 9/30/98
                                                                                  (Unaudited)

<S>                                                                             <C>                  <C>
ASSETS
Current assets
Cash and cash equivalents .............................................         $   1,656,469             3,904,087
Trade accounts receivable, net ........................................               461,013             1,033,860
Other accounts receivable .............................................               267,887               124,690
Inventories (Note 2) ..................................................             4,790,489             3,289,172
Prepaid expenses ......................................................               111,262               172,196
                                                                                 ------------          ------------
                                                                                    7,287,120             8,524,005

Property and equipment, net ...........................................             3,660,861             4,100,804
Patents and proprietary technology, net ...............................             1,894,783             1,736,998
Other assets and deposits .............................................                 9,861                28,519
                                                                                 ------------          ------------
                                                                                $  12,852,625        $   14,390,326
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable ......................................................         $     569,938               178,171
Current portion of long-term debt......................................                 4,576                 4,255
Current portion of long-term lease liability...........................               204,495               358,404
Revolving line of credit (Note 3)......................................             1,100,000                     -
Deposits on customer orders............................................             1,533,342               599,944
Salaries, benefits and other accrued liabilities ......................               543,196               499,313
                                                                                 ------------          ------------
                                                                                    3,955,547             1,640,087

Long-term portion of installment notes payable.........................                 6,499                10,238
Long-term lease liability, less current portion........................                     -               115,785
Minority interest in consolidated subsidiary ..........................             1,368,451             1,613,977
                                                                                    ---------             ---------
                                                                                    5,330,497             3,380,087

Commitments and contingencies (Note 3).................................                     -                     -

Stockholders' equity
Preferred stock, $.01 par value- 10,000,000 shares authorized,
 Series A- 214,285 shares outstanding .................................                 2,143                 2,143
Common stock, $.01 par value- 30,000,000 shares authorized,
 4,069,858 and 4,050,150 shares outstanding, respectively..............                40,698                40,502
Additional paid-in capital ............................................            57,732,547            57,386,675
Accumulated deficit....................................................           (50,253,260)          (46,419,081)
                                                                                  -----------           ------------
                                                                                    7,522,128            11,010,239

                                                                                $  12,852,625         $  14,390,326

</TABLE>


                                       2
<PAGE>



AGRITOPE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
                                                          THREE MONTHS ENDED                  NINE MONTHS ENDED

                                                       6/30/99           6/30/98          6/30/99           6/30/98
<S>                                               <C>              <C>               <C>              <C>
Revenues
Product sales ................................... $  1,225,341     $     663,562     $  1,559,875      $    845,619
Grants and contracts ............................      303,279                 -          628,021            71,815
                                                   -----------       -----------       ----------       -----------
                                                     1,528,620           663,562        2,187,896           917,434
Costs and expenses
Product costs ...................................    1,195,091           648,111        1,540,101           816,775
Research and development costs ..................      814,045           745,385        2,265,976         1,820,677
Selling, general and administrative expenses.....      916,573           884,715        2,728,547         2,494,749
                                                   -----------       -----------       ----------       -----------
                                                     2,925,709         2,278,211        6,534,624         5,132,201

Loss from operations ............................   (1,397,089)       (1,614,649)      (4,346,728)       (4,214,767)

Other income (expense), net
Interest income..................................       11,617            68,985          105,285           162,852
Interest expense.................................       (4,211)             (248)          (4,626)             (793)
Other, net.......................................       (6,400)         (128,650)         166,364          (125,053)
                                                   ------------      ------------      ----------       ------------
                                                         1,006           (59,913)         267,023            37,006

Minority interest in subsidiary net loss......... $     93,112     $     185,225     $    245,526      $    439,922

Net loss......................................... $ (1,302,971)    $  (1,489,337)    $ (3,834,179)     $ (3,737,839)

Net loss per share (basic and diluted)........... $       (.32)    $        (.37)    $       (.94)     $      (1.04)

Weighted average number of
     shares outstanding (basic and diluted)......    4,065,803         4,037,260        4,058,648         3,592,437

</TABLE>


                                       3
<PAGE>


AGRITOPE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
(UNAUDITED)


<TABLE>
<CAPTION>
                                                    SHARES               AMOUNT           ADDITIONAL        ACCUMULATED
                                           PREFERRED    COMMON     PREFERRED  COMMON    PAID-IN CAPITAL        DEFICIT
<S>                                          <C>      <C>          <C>       <C>          <C>               <C>
Balances at September 30, 1998.........      214,285  4,050,150    $2,143    $40,502      $57,386,675       $(46,419,081)
Common stock issued
   as compensation ....................            -     19,708         -        196           40,260                  -
Compensation expense
   for stock option grants ............            -          -         -          -          316,920                  -
Equity issuance costs..................            -          -         -          -          (11,308)                 -
Net loss for the period ...............            -          -         -          -                -       (  3,834,179)
                                           --------------------    ------  ---------    --------------      -------------
Balances at June 30, 1999..............      214,285  4,069,858    $2,143    $40,698      $57,732,547       $(50,253,260)

</TABLE>

                                       4
<PAGE>


AGRITOPE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)


<TABLE>
<CAPTION>
                                                                                           NINE MONTHS ENDED

                                                                                       6/30/99             6/30/98

<S>                                                                             <C>                   <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss ..............................................................         $  (3,834,179)        $  (3,737,839)
Adjustments to reconcile net loss
   to net cash used in operating activities:
Depreciation and amortization .........................................               984,939               665,531
Loss on sale of property...............................................                 3,637                    54
Decrease in accounts receivable .......................................               429,650               217,291
(Increase) in inventories .............................................            (1,501,317)           (2,684,347)
Decrease in prepaid expenses ..........................................                60,934                32,295
Decrease (increase) in other assets and deposits ......................                18,658               (13,802)
Increase in deposits on customer orders................................               933,398               812,971
Increase (decrease) in accounts payable and accrued liabilities .......               435,650               (91,695)
Common stock issued as compensation for services.......................                40,456                27,866
Compensation expense for stock option grants...........................               316,920               287,280
Minority interest in subsidiary operating results......................              (245,526)             (439,922)
Other, net.............................................................                     -               150,167
                                                                                 ------------          ------------
Net cash used in operating activities..................................            (2,356,780)           (4,774,150)

CASH FLOWS FROM INVESTING ACTIVITIES
Additions to property and equipment ...................................              (344,131)           (1,791,312)
Proceeds from sale of property ........................................                   900                11,033
Expenditures for patents and proprietary technology ...................              (363,187)             (467,448)
                                                                                 -------------         -------------
Net cash used in investing activities..................................              (706,418)           (2,247,727)

CASH FLOWS FROM FINANCING ACTIVITIES
Issuance of long-term debt.............................................                     -                     -
Principal payments on long-term debt...................................                (3,418)               (3,225)
Payments on long-term lease obligation.................................              (269,694)             (220,295)
Proceeds from revolving line of credit (Note 3)........................             1,100,000                     -
Proceeds from issuance of stock .......................................               (11,308)            9,812,418
Minority interest investment in subsidiary ............................                     -             1,765,453
Cash contribution from Epitope, Inc. ..................................                     -             1,248,140
                                                                                 ------------          ------------
Net cash provided by financing activities..............................               815,580            12,602,491

Net increase (decrease) in cash and cash equivalents ..................            (2,247,618)            5,580,614
Cash and cash equivalents at beginning of period ......................             3,904,087                 4,384
                                                                                 ------------          ------------
Cash and cash equivalents at end of period.............................         $   1,656,469          $  5,584,998

</TABLE>


                                       5
<PAGE>



AGRITOPE, INC AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

NOTE 1     THE COMPANY

Agritope,  Inc. (the "Company" or "Agritope")  is an  Oregon-based  agricultural
biotechnology  company  that  develops  improved  plant  products  and  provides
technology  to  the   agricultural   industry.   Through  its  64  percent-owned
subsidiary,  Vinifera,  Inc.  ("Vinifera"),  Agritope  is  also  engaged  in the
business of propagating,  growing,  and  distributing  grapevine  plants.  Until
December 30,  1997,  Agritope was a wholly  owned  subsidiary  of Epitope,  Inc.
("Epitope").

The condensed  consolidated  financial statements included herein are unaudited;
however, in the opinion of management, the interim data include all adjustments,
consisting  only  of  normal  recurring   adjustments,   necessary  for  a  fair
presentation of the financial position and results of operations for the interim
periods.  These condensed  consolidated  financial  statements should be read in
conjunction  with the full year financial  statements and notes thereto included
in the Company's 1998 Annual Report on Form 10-K.  Results of operations for the
three-month  and  nine-month  periods  ended June 30,  1999 are not  necessarily
indicative of the results of operations expected for the full fiscal year.

NOTE 2     SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

BASIS  OF  PRESENTATION.   The  accompanying  condensed  consolidated  financial
statements of Agritope include the assets, liabilities, revenues and expenses of
Agritope and its  subsidiaries.  All significant  intercompany  transactions and
balances have been eliminated. Certain prior year amounts have been reclassified
to conform to current year presentation.

INVENTORIES.  Inventories  consisted  principally of growing grapevine plants at
Vinifera. The components of inventory are summarized as follows:

                                                    6/30/99              9/30/98
                                                 (Unaudited)
Operating supplies........................      $   124,213          $   142,900
Work-in process...........................        1,297,351              128,374
Finished goods............................        3,368,925            3,017,898
                                                  ---------         ------------
                                                 $4,790,489           $3,289,172
NET LOSS PER SHARE. Basic and diluted loss per share has been computed using the
weighted average number of shares of common stock outstanding during the period.
The following  potentially  dilutive  securities  are excluded from net loss per
share calculations as their effect would have been antidilutive:

                                                    6/30/99              6/30/98

Options to purchase common stock..........        1,713,928            1,407,164
Warrants to purchase common stock.........          583,333              583,333
Convertible preferred stock...............          214,285              214,285
                                                 ----------           ----------
                                                  2,511,546            2,204,782
NOTE 3     BANK LINES OF CREDIT

REVOLVING LINE OF CREDIT.  In June 1999,  Vinifera  borrowed $1.1 million from a
commercial  bank under a revolving  line of credit.  The  proceeds  were used to
finance  inventory  production and repay a $1 million line of credit advanced by
Agritope.  The line provides for borrowings of up to $1.5 million and is secured
by Vinifera's  inventories  and accounts  receivable and is guaranteed by one of
Vinifera's minority shareholders.  The line bears interest at the prime rate. It
expires on May 1, 2000.

ACCOUNTS  RECEIVABLE  LINE OF  CREDIT.  In May 1999,  Agritope  entered  into an
agreement  with a commercial  bank pursuant to which the bank will advance up to
$500,000 based on 80% of qualified and approved accounts receivable. The line of
credit bears  interest at the rate of 2% per month and each  advance  carries an
administration  fee of 0.65%.  It expires on May 20,  2000.  The Company has not
made any borrowings under the line.



                                       6
<PAGE>

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

         The following  discussion of operations and financial  condition should
be read in  conjunction  with the  consolidated  financial  statements and notes
thereto  included in the Company's  1998 Annual Report on Form 10-K and with the
financial statements and notes thereto included in this Form 10-Q.



CERTAIN  STATEMENTS  SET FORTH  BELOW  CONSTITUTE  "FORWARD-LOOKING  STATEMENTS"
WITHIN THE  MEANING OF THE  PRIVATE  SECURITIES  LITIGATION  REFORM ACT OF 1995.
STATEMENTS THAT EXPRESSLY OR BY IMPLICATION PREDICT FUTURE RESULTS,  PERFORMANCE
OR EVENTS ARE  FORWARD-LOOKING.  IN ADDITION,  THE WORDS "BELIEVES,"  "INTENDS,"
"EXPECTS," "ANTICIPATES,"  "ESTIMATES," AND SIMILAR EXPRESSIONS IDENTIFY FORWARD
LOOKING-STATEMENTS.  THE  FORWARD-LOOKING  STATEMENTS  INVOLVE KNOWN AND UNKNOWN
RISKS,  UNCERTAINTIES  AND OTHER  FACTORS  THAT MAY CAUSE  THE  ACTUAL  RESULTS,
PERFORMANCE OR ACHIEVEMENTS OF THE COMPANY OR INDUSTRY  RESULTS TO BE MATERIALLY
DIFFERENT  FROM ANY FUTURE  RESULTS,  PERFORMANCE OR  ACHIEVEMENTS  EXPRESSED OR
IMPLIED BY THE FORWARD-LOOKING  STATEMENTS.  WITH RESPECT TO THE COMPANY,  THESE
FACTORS  INCLUDE ITS  LIMITED  INDEPENDENT  OPERATING  HISTORY;  UNCERTAINTY  OF
ADDITIONAL  FUNDING;  LOSS OR  IMPAIRMENT  OF SOURCES OF CAPITAL;  DEPENDENCE ON
STRATEGIC   PARTNERS;   UNCERTAINTIES   RELATING  TO  PATENTS  AND   PROPRIETARY
INFORMATION;  DEPENDENCE ON KEY PERSONNEL; TECHNOLOGICAL CHANGE AND COMPETITION;
UNCERTAINTIES AS TO ACCEPTANCE OF GENETICALLY  ENGINEERED  PRODUCTS;  CHANGES IN
LAWS OR REGULATIONS; AS WELL AS THE OTHER FACTORS DISCUSSED IN EXHIBIT 99 TO THE
COMPANY'S  1998  ANNUAL  REPORT ON FORM 10-K,  WHICH IS HEREBY  INCORPORATED  BY
REFERENCE.  GIVEN THESE UNCERTAINTIES,  READERS ARE CAUTIONED NOT TO PLACE UNDUE
RELIANCE ON THE FORWARD-LOOKING  STATEMENTS.  AGRITOPE DOES NOT INTEND TO UPDATE
ANY FORWARD-LOOKING STATEMENTS.


Agritope,  Inc. (the  "Company" or "Agritope")  consists of two units:  Agritope
Research and Development and Vinifera, Inc. ("Vinifera").  Agritope Research and
Development uses  biotechnology  in the development of new plant  varieties.  To
date, Agritope has not completed  commercialization of its technology. A portion
of the research and development efforts conducted by Agritope has been performed
under  various  research  grants  and  contracts.  Vinifera  is  engaged  in the
grapevine propagation and distribution business.

RECENT DEVELOPMENTS


GENE  DISCOVERY  PROGRAM.  In July 1999,  Agritope  and  Rhone-Poulenc  Agro,  a
division of Rhone-Poulenc,  S.A. formed Agrinomics LLC ("Agrinomics")  which has
begun a  research,  development  and  commercialization  program in the field of
agricultural  functional  genomics.  The program is called the  ACTTAG(TM)  Gene
Discovery Program.  Agritope owns a 50% interest in Agrinomics and Rhone-Poulenc
Agro owns the remaining 50% interest.

Rhone-Poulenc  Agro has agreed to make capital  contributions to Agrinomics,  in
cash, totaling $20 million over a five-year period. A $5 million contribution to
support the first year of operations was made in July 1999. Agritope contributed
technology,  a collection of seed generated using activation  tagging techniques
and expertise in molecular and cell biology. In addition,  Agritope will perform
research  work  at  its  Oregon   research   facility,   greenhouses  and  farm.
Rhone-Poulenc  Agro  will  also  provide  high-throughput  screening,  robotics,
microarray and  bioinformatics  technologies  and support,  and perform research
work for  Agrinomics  at  Rhone-Poulenc  Agro's  research  facility  in Research
Triangle Park, North Carolina.

Through its fully integrated functional genomics program,  Agrinomics intends to
develop a network of research  and  commercial  alliances  with a broad range of
interests.  Discussions with several prospective sponsors are underway. Alliance
participants  would provide funding for specific  projects.  Participants  would
receive  rights to  technology  in their  field of interest as well as access to
technology developed within the Agrinomics network.

VINIFERA,  INC. In June 1999, the Company entered into stock purchase agreements
with  certain  minority  shareholders  of Vinifera  pursuant  to which  minority
ownership  of  Vinifera  will  increase  from  36%  to  approximately  50%.  The
agreements  provide for the  shareholders  to purchase shares of Vinifera common
stock from Agritope over a three-year  period.  In July 1999,  the  shareholders
made the  first  purchase  under  the  agreements.  Agritope  received  proceeds
totaling $874,000 and its ownership interest in Vinifera was reduced from 64% to


                                       7
<PAGE>

57%.  In June 1999,  in a related  transaction,  Vinifera  repaid the $1 million
balance on its working  capital line of credit to Agritope and replaced the line
with a $1.5  million  revolving  bank  line of  credit  (See  Note 3 of Notes to
Condensed  Consolidated  Financial  Statements).  SBIR  GRANT.  In  April  1999,
Agritope  was awarded a grant by the United  States  Department  of  Agriculture
Cooperative  State  Research,  Education and  Extension  Service under the Small
Business  Innovation  Research  Program.  The award will provide  $65,000 over a
five-month period to fund a research program regarding development of resistance
in red raspberry to raspberry bush dwarf virus.


RESULTS OF OPERATIONS

REVENUES.  Total revenues were $1,529,000 and $2,188,000 for the three-month and
nine-month periods ended June 30, 1999,  respectively,  representing an increase
of  $865,000  and  $1,271,000,  respectively,  over  revenues  recorded  for the
corresponding periods in the prior fiscal year, as summarized below:

<TABLE>
<CAPTION>
THREE MONTHS ENDED JUNE 30 (IN THOUSANDS, EXCEPT %)              1999                       1998
                                                          DOLLARS    PERCENT         DOLLARS    PERCENT
<S>                                                        <C>          <C>            <C>        <C>
Product sales-
Grape plant sales......................................... $ 1,226       80%           $  664     100%

Grants and contracts......................................     303       20                 -       -
                                                             -----      ---             -----     ---
                                                           $ 1,529      100%            $ 664     100%

NINE MONTHS ENDED JUNE 30 (IN THOUSANDS, EXCEPT %)               1999                       1998
                                                          DOLLARS    PERCENT         DOLLARS    PERCENT
Product sales-
Grape plant sales......................................... $ 1,560       71%          $   845      92%

Grants and contracts......................................     628       29                72       8
                                                            ------      ---              ----    ----
                                                           $ 2,188      100%            $ 917     100%
</TABLE>

Vinifera's  sales of grapevines  increased  $561,000 (84%) and $715,000 (85%) in
the third  quarter  and first  nine  months of  fiscal  1999,  respectively,  as
compared to the third quarter and first  nine-months of fiscal 1998.  Vinifera's
sales are highly  seasonal and generally occur in the spring and summer planting
seasons.  However,  unseasonable  weather conditions caused certain customers to
delay orders that were  originally  scheduled  for delivery in fiscal 1998.  The
delayed orders were either  deferred to the 1999 planting season or delivered in
the quarter ended March 31, 1999. As of June 30, 1999,  Vinifera had firm orders
totaling  $1.7  million for  delivery in the summer of 1999 and $2.1 million for
delivery  in the  spring  and  summer of 2000  compared  to firm  orders of $1.8
million as of June 30, 1998 scheduled for delivery in the 1998 planting  season,
and $1.1 million for delivery in 1999.

RESEARCH AND DEVELOPMENT EXPENSES. Research and development expenses amounted to
$814,000 and $2.3 million,  respectively,  for the quarter and nine months ended
June 30,  1999,  representing  increases  of $69,000  (9%) and  $445,000  (24%),
respectively, over the corresponding prior-year periods. The higher research and
development  costs in the  current  fiscal  year  reflect  increased  efforts to
develop and propagate crops  containing  Agritope's  patented  ethylene  control
technology and stepped-up  research  efforts to explore the potential of certain
genes obtained from the Salk Institute.  Rent,  depreciation  and other costs of
occupancy  attributable to research activities also increased as a result of the
Company's move to expanded quarters in March 1998.


                                       8
<PAGE>

SELLING,   GENERAL   AND   ADMINISTRATIVE   EXPENSES.   Selling,   general   and
administrative   expenses   increased  by  $32,000   (4%)  and  $234,000   (9%),
respectively,  in the three-month and nine-month periods ended June 30, 1999, as
compared to the  corresponding  periods  ended June 30, 1998.  Major  components
accounting for the net increase included increased  compensation expense related
to amortization of expense for stock options granted in December 1997, increased
sales  expenses at Vinifera and  increased  legal fees related to the  Company's
proposed gene discovery program. Rent, depreciation and other costs of occupancy
also increased as a result of the Company's  move to expanded  quarters in March
1998.  The increases were  partially  offset by decreases in other  professional
fees and travel  expenses due to the fact that  expenses in the first quarter of
the 1998  fiscal  year  included  non-recurring  fees and  expenses  incurred in
connection  with the transition  from operating as a wholly owned  subsidiary to
operating as an independent public company.

OTHER INCOME  (EXPENSE),  NET.  Interest income decreased $57,000 in the quarter
ended  June 30,  1999  compared  to the  quarter  ended  June 30,  1998 due to a
corresponding decrease in cash available for investment. In March 1999, Vinifera
received a one-time payment of $170,000,  representing reimbursement for certain
expenses incurred in prior years to explore establishment of a grapevine nursery
business  in Spain in  cooperation  with a  minority  shareholder  of  Vinifera.
Vinifera  ultimately decided to discontinue its participation and was reimbursed
for expenses it incurred for the benefit of the venture.

LIQUIDITY AND CAPITAL RESOURCES

                                                   6/30/99               9/30/98
Cash and cash equivalents................       $1,656,469            $3,904,087
Working capital .........................        3,331,573             6,883,918

As of June 30, 1999,  Agritope had working capital of $3.3 million,  as compared
to working capital of $6.9 million at September 30, 1998. During the nine months
ended June 30, 1999,  expenditures  for property and  equipment  were  $344,000,
principally for greenhouse  improvements and expansion of grapevine  propagation
blocks  at  Vinifera.   The  Company  also  expended  $363,000  for  proprietary
technology  related to its patent portfolio.  For the nine-months ended June 30,
1999,  Vinifera  used  internally  generated  cash from  collection  of accounts
receivable  and  deposits  on  future  orders  to fund  operations  and  capital
expenditures.  Agritope's  cash  requirements  for the  nine-month  period  were
supplied  primarily  from cash reserves  supplemented  by research  funding from
government agencies and Vilmorin Clause & Cie ("Vilmorin"),  a research partner.
In addition,  Agritope  received $1 million  from  Vinifera in  connection  with
refinancing of the Vinifera line of credit with a commercial bank (See Note 3 of
Notes to Condensed Consolidated Financial Statements).

Historically,  Agritope's  requirements  for  operations,  working  capital  and
business  expansion  have been funded by receipts of cash from its former parent
company,  Epitope,  Inc.,  supplemented  by $5.4  million  principal  amount  of
convertible   notes,  $3.5  million  of  investments  in  Vinifera  by  minority
shareholders,  $9.9  million  net  proceeds  from  private  placement  of equity
securities  and $1.2  million  in  funding  from  strategic  partners  and other
research  grants.  On December 1, 1997,  in  anticipation  of its spin-off  from
Epitope,  Agritope  assumed  responsibility  for funding its future  activities.
During  the  quarter  ended  December  31,  1997,  Agritope  received  a capital
contribution of $1.2 million from Epitope to fund cash  requirements  during the
months of October and November 1997 and Epitope  advanced  $917,000 for December
cash requirements.

On December 30, 1997, Epitope distributed 100% of Agritope's  outstanding common
stock to  shareholders  of Epitope.  On December  31,  1997,  Agritope  sold 1.3
million shares of common stock in a private placement  transaction at a price of
$7 per share for aggregate proceeds of $9.4 million.  In January 1998,  Agritope
sold 214,285  shares of Series A Preferred  Stock at a price of $7 per share for
aggregate  proceeds of $1.5  million and repaid to Epitope  $976,000 of advances
for cash requirements after December 1, 1997.


                                       9
<PAGE>

Agritope  expects to  continue  to  require  significant  funds to  support  its
operations  and  research  activities.  It  intends to use cash  reserves,  cash
generated from sales of products,  research funding from strategic  partners and
other research grants to provide the necessary funds.  Agritope may also receive
additional funds from the sale of equity securities.  Additional capital may not
be  available  on  acceptable  terms,  if at all,  and the failure to raise such
capital would have a material adverse effect on Agritope's  business,  financial
condition, and results of operations.

Vilmorin has agreed to fund additional projects totaling $400,000 for work to be
performed from July 1, 1999 to June 30, 2000.  Agritope also expects to complete
work under its  matching  grant from the National  Institute  of  Standards  and
Technology  in the remainder of the current  contract  year ending  December 31,
1999, for total reimbursements of $305,000.

Agritope  has  completed a Year 2000 review of its  systems  and  procedures  to
determine  the costs and risks  related to the Year 2000 date  conversion.  As a
result of this review,  Agritope  believes that it will not incur  material Year
2000 remedial costs and that its operations  will not be materially  affected by
the  Year  2000  conversion,  and as a  consequence  it has  not  established  a
contingency plan.


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<PAGE>



                           PART II. OTHER INFORMATION


ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

(a)      Exhibits

         (27)  Financial Data Schedule

(b)      No reports on Form 8-K were filed during the three months ended
         June 30, 1999.


                                   SIGNATURES

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



                            AGRITOPE, INC.


August 12, 1999             /s/ ADOLPH J. FERRO
-----------------           --------------------
Date                        Adolph J. Ferro
                            Chairman, President and Chief Executive Officer
                            (PRINCIPAL EXECUTIVE OFFICER)




August 12, 1999             /s/ GILBERT N. MILLER
-----------------           ----------------------
Date                        Gilbert N. Miller
                            Executive Vice President and Chief Financial Officer
                            (PRINCIPAL FINANCIAL AND ACCOUNTING OFFICER)


                                       11
<PAGE>


                                  EXHIBIT INDEX

EXHIBIT                        DESCRIPTION                                  PAGE

27.                            Financial Data Schedule                       13


























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