SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-Q


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

     For the quarterly period ended JUNE 30, 2002

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

     For the transition period from                     to
                                    -------------------    ---------------------

                         Commission File Number 0-28674

                        CADUS PHARMACEUTICAL CORPORATION
--------------------------------------------------------------------------------
             (Exact Name of Registrant as Specified on its Charter)


                Delaware                                    13-3660391
--------------------------------------------------------------------------------
      (State of Other Jurisdiction                      (I.R.S. Employer
    of Incorporation or Organization)                  Identification No.)

  767 Fifth Avenue, New York, New York                        10153
--------------------------------------------------------------------------------
(Address of Principal Executive Offices)                    (Zip Code)

Registrant's Telephone Number, Including Area Code        (212) 702-4315
                                                    ----------------------------



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 of registrant's common stock, $0.01 par value,  outstanding
as of July 31, 2002 was 13,144,040.

<PAGE>


                        CADUS PHARMACEUTICAL CORPORATION

                                      INDEX
                                                                        PAGE NO.
SPECIAL NOTE REGARDING FORWARD LOOKING STATEMENTS                          3

              PART I - CONDENSED CONSOLIDATED FINANCIAL INFORMATION

Item 1.  Condensed Consolidated Financial Statements

              Condensed Consolidated Balance
              Sheets - June 30, 2002 (unaudited)
              and December 31, 2001 (audited)                              4

              Condensed Consolidated Statements
              of Operations - Three Months Ended
              June 30, 2002 and 2001 (unaudited)                           5

              Condensed Consolidated Statements
              of Operations - Six Months Ended
              June 30, 2002 and 2001 (unaudited)                           6

              Condensed Consolidated Statements
              of Cash Flows - Six Months Ended
              June 30, 2002 and 2001 (unaudited)                           7

              Notes to Condensed Consolidated
              Financial Statements (unaudited)                        8 - 10

Item 2.  Management's Discussion and Analysis of
         Financial Condition and Results of Operations               11 - 12

Item 3.  Quantitative and Qualitative Disclosures About Market Risk       13

                           PART II - OTHER INFORMATION

Item 1.  Legal Proceedings                                                13

Item 2.  Changes in Securities and Use of Proceeds                        13

Item 3.  Defaults Upon Senior Securities                                  13

Item 4.  Submission of Matters to a Vote of Security Holders              13

Item 5.  Other Information                                                13

Item 6.  Exhibits and Reports on Form 8K                                  13

SIGNATURES                                                                14

EXHIBIT INDEX                                                             15



                                        2
<PAGE>


SPECIAL NOTE REGARDING FORWARD LOOKING STATEMENTS

Certain   statements  in  this   Quarterly   Report  on  Form  10-Q   constitute
"forward-looking statements" within the meaning of Section 21E of the Securities
Exchange Act of 1934, as amended. Such forward-looking  statements involve known
and unknown risks,  uncertainties,  and other factors which may cause the actual
results,  performance, or achievements of the Company to be materially different
from any future  results,  performance or  achievements  expressed or implied by
such forward-looking statements.  Factors that could cause or contribute to such
differences  include,  but  are  not  limited  to,  technological  uncertainties
regarding the Company's  technologies,  risks and uncertainties  relating to the
Company's  ability to realize value from its assets,  the  Company's  ability to
license its technologies to third parties,  the Company's future acquisition and
in-licensing  of  technologies,  the Company's  capital needs and uncertainty of
future  funding,  the  Company's  history of  operating  losses,  the  Company's
dependence  on  proprietary   technology  and  the  unpredictability  of  patent
protection,   intense   competition  in  the  pharmaceutical  and  biotechnology
industries,  rapid  technological  development  that may result in the Company's
technologies  becoming  obsolete,  as  well as  other  risks  and  uncertainties
discussed in the Company's prospectus dated July 17, 1996.


                                       3
<PAGE>


ITEM 1.           CONDENSED CONSOLIDATED FINANCIAL STATEMENTS


                        CADUS PHARMACEUTICAL CORPORATION
                      CONDENSED CONSOLIDATED BALANCE SHEETS

                                     ASSETS

                                                        JUNE 30,    DECEMBER 31,
                                                          2002         2001
                                                      -----------   -----------
                                                      (Unaudited)    (Audited)
Current assets
  Cash and cash equivalents                           $24,108,292   $24,469,357
  License fee receivable                                       --       500,000
  Prepaid and other current assets                         45,524        75,000
                                                      -----------   -----------
      Total current assets                             24,153,816    25,044,357

Investment in other ventures                              167,021       165,614
Other assets, net                                         950,169       990,622
                                                      -----------   -----------
      Total assets                                    $25,271,006   $26,200,593
                                                      ===========   ===========


                      LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities
  Accrued expenses and other current liabilities      $   175,396   $    95,032
  Arbitration settlement                                       --       750,000
                                                      -----------   -----------
      Total current liabilities                           175,396       845,032
                                                      -----------   -----------

Stockholders' equity
  Common stock                                            132,857       132,857
  Additional paid-in capital                           59,844,355    59,844,355
  Accumulated deficit                                 (34,581,527)  (34,321,576)
  Treasury stock                                         (300,075)     (300,075)
                                                      -----------   -----------
      Total stockholders' equity                       25,095,610    25,355,561
                                                      -----------   -----------
      Total liabilities and stockholders' equity      $25,271,006   $26,200,593
                                                      ===========   ===========


      See accompanying notes to condensed consolidated financial statements


                                        4
<PAGE>


                        CADUS PHARMACEUTICAL CORPORATION

                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS


                                                         Three Months Ended
                                                               June 30,
                                                          2002          2001
                                                      -----------   -----------
                                                      (Unaudited)    (Unaudited)
License and maintenance fees                          $        --   $        --
                                                      -----------   -----------
    Total revenues                                             --            --
                                                      -----------   -----------
Costs and expenses:
  General and administrative expenses                     277,835       407,641
  Gain from equity in other ventures                         (725)       (2,165)
                                                      -----------   -----------
    Total costs and expenses                              277,110       405,476
                                                      -----------   -----------
Loss from operations                                     (277,110)     (405,476)
                                                      -----------   -----------

Other income:
  Interest income                                          85,619       234,793
                                                      -----------   -----------
    Total other income                                     85,619       234,793
                                                      -----------   -----------
Loss before income taxes                                 (191,491)     (170,683)

Income taxes                                                   --            --
                                                      -----------   -----------
      Net loss                                        ($  191,491)  ($  170,683)
                                                      ===========   ===========
Basic and diluted loss per weighted
average share of common stock outstanding             ($     0.01)  ($     0.01)
                                                      ===========   ===========
Weighted average shares of common stock
outstanding - basic and diluted                        13,144,040    13,144,040
                                                      ===========   ===========


      See accompanying notes to condensed consolidated financial statements


                                       5
<PAGE>


                        CADUS PHARMACEUTICAL CORPORATION

                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS


                                                           Six Months Ended
                                                               June 30,
                                                          2002          2001
                                                      -----------   -----------
                                                      (Unaudited)   (Unaudited)

License and maintenance fees                          $   100,000   $   100,000
                                                      -----------   -----------
    Total revenues                                        100,000       100,000
                                                      -----------   -----------
Costs and expenses:
  General and administrative expenses                     541,545       648,908
  Gain from equity in other ventures                       (1,407)       (1,979)
                                                      -----------   -----------
    Total costs and expenses                              540,138       646,929
                                                      -----------   -----------
Loss from operations                                     (440,138)     (546,929)
                                                      -----------   -----------

Other income:
  Interest income                                         180,187       529,494
  Net reimbursement of SIBIA litigation costs                  --       125,616
                                                      -----------   -----------
    Total other income                                    180,187       655,110
                                                      -----------   -----------
(Loss) income before income taxes                        (259,951)      108,181

Income taxes                                                   --            --
                                                      -----------   -----------
      Net (loss) income                               ($  259,951)  $   108,181
                                                      ===========   ===========
Basic and diluted (loss) income per weighted
average share of common stock outstanding             ($     0.02)  $      0.01
                                                      ===========   ===========
Weighted average shares of common stock
outstanding - basic and diluted                        13,144,040    13,144,040
                                                      ===========   ===========


      See accompanying notes to condensed consolidated financial statements


                                       6
<PAGE>


                        CADUS PHARMACEUTICAL CORPORATION

                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS


                                                           Six Months Ended
                                                               June 30,
                                                          2002          2001
                                                      -----------   -----------
                                                      (Unaudited)   (Unaudited)
Cash flows from operating activities:

  Net (loss) income                                   ($  259,951)  $   108,181

  Adjustments to reconcile net (loss) income to net
    cash (used in) provided by operating activities:

    Amortization of patent costs                           40,453        40,453

    Gain from equity in other ventures                     (1,407)       (1,979)

  Changes in assets and liabilities:

    Decrease in license fee receivable                    500,000            --

    Decrease in prepaid and other current assets           29,476        83,556

    (Decrease) increase in accrued expenses and
      other current liabilities                          (669,636)      110,076
                                                      -----------   -----------
Net cash (used in) provided by operating activities      (361,065)      340,287
                                                      -----------   -----------
Net (decrease) increase in cash and cash equivalents     (361,065)      340,287

Cash and cash equivalents - beginning of period        24,469,357    24,383,352
                                                      -----------   -----------
Cash and cash equivalents - end of period             $24,108,292   $24,723,639
                                                      ===========   ===========


      See accompanying notes to condensed consolidated financial statements


                                       7
<PAGE>


                        CADUS PHARMACEUTICAL CORPORATION

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS


Note - 1   ORGANIZATION AND BASIS OF PREPARATION

           The  information  presented as of June 30, 2002 and for the three and
           six  month  periods  then  ended,  is  unaudited,  but  includes  all
           adjustments  (consisting only of normal recurring  accruals) that the
           Company's   management   believes  to  be  necessary   for  the  fair
           presentation   of  results   for  the  periods   presented.   Certain
           information and footnote  disclosures  normally included in financial
           statements   prepared  in  accordance  with   accounting   principles
           generally  accepted in the United States of America have been omitted
           pursuant  to  the   requirements   of  the  Securities  and  Exchange
           Commission,  although  the  Company  believes  that  the  disclosures
           included  in these  financial  statements  are  adequate  to make the
           information not  misleading.  The December 31, 2001 balance sheet was
           derived from audited financial statements. These financial statements
           should be read in  conjunction  with the  Company's  annual report on
           Form 10-K for the year ended December 31, 2001.

           The  consolidated  financial  statements  include the accounts of the
           Company and its wholly owned  subsidiary  Cadus  Technologies,  Inc.,
           organized  in  December  2001.   All  inter-  company   balances  and
           transactions have been eliminated in consolidation.

           The results of  operations  for the six month  period  ended June 30,
           2002 are not necessarily indicative of the results to be expected for
           the year ending December 31, 2002.

Note - 2   NET (LOSS) INCOME PER COMMON SHARE

           For the three  and six month  periods  ended  June 30,  2002 and 2001
           basic net (loss)  income per share is computed  by  dividing  the net
           (loss)  income  by the  weighted  average  number  of  common  shares
           outstanding. Diluted net (loss) income per share is the same as basic
           net (loss) income per share since the inclusion of 609,309  shares of
           potential  common stock  equivalents  (stock options and warrants) in
           the computation at June 30, 2002 would be anti- dilutive.

Note - 3   LICENSING AGREEMENTS

           In December 2001, the Company licensed its yeast-based drug discovery
           technologies  on a  non-exclusive  basis  to a  major  pharmaceutical
           company.  Under the  licensing  agreement,  the  Company  received an
           up-front  non-refundable fee of $500,000 that was recorded as revenue
           in the December 31, 2001 consolidated  statement of operations as the
           Company  has no  further  involvement  with  the  development  of the
           product.  The Company  received  payment in January 2002. The Company
           will  receive  an  additional  licensing  fee  of  $1,000,000  if the
           licensee achieves a research  milestone.  The licensee is entitled to
           use the technologies for five years from the date of the agreement if
           it makes such $1,000,000


                                       8
<PAGE>


                        CADUS PHARMACEUTICAL CORPORATION

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS


           payment.  If the $1,000,000 payment is not made by February 2003, the
           Company  has the right to  terminate  the  agreement.  Following  the
           initial five year term,  the licensee may renew the license  annually
           upon payment of an annual licensing fee of $250,000.

           In  February  2000,  Cadus  licensed  to  OSI  Pharmaceuticals,  Inc.
           ("OSI"),  on a non-exclusive  basis,  its yeast-based  drug discovery
           technologies,  including  various  reagents  and its  library of over
           30,000 yeast strains,  and its bioinformatics  software.  OSI paid to
           Cadus a license fee of $100,000 and an access fee of $600,000. OSI is
           also obligated to pay an annual maintenance fee of $100,000 until the
           earlier of 2010 or the  termination of the license and a supplemental
           license fee of $250,000  which was paid in December  2000,  after the
           lifting  of the  injunction  obtained  by SIBIA  Neurosciences,  Inc.
           ("SIBIA"), and recorded as license fee revenue. OSI may terminate the
           license at any time on 30 days prior written  notice.  During the six
           month period ended June 30, 2002 and 2001, Cadus recognized  $100,000
           of license revenue related to this agreement.

Note - 4   ARBITRATION AWARD

           In March 2002, the arbitrator in the arbitration proceeding commenced
           against Cadus by Philip N. Sussman, the former Senior Vice President,
           Finance and Corporate  Development,  and Chief  Financial  Officer of
           Cadus,  ruled in favor of Mr.  Sussman and awarded him  approximately
           $750,000 in severance pay, interest and attorneys and other costs and
           fees. A charge of $750,000 was recorded in the consolidated statement
           of operations  for the year ended  December 31, 2001.  The payment to
           Mr. Sussman was made during the quarter ended June 30, 2002.


Note - 5   ADOPTION OF NEW ACCOUNTING PRONOUNCEMENT

           Statement of Financial  Accounting  Standards No. 142,  "Goodwill and
           Other  Intangible  Assets"  ("SFAS  142"),  addresses  the  method of
           identifying  and  measuring  goodwill  and other  intangible  assets,
           eliminates  further  amortization  of goodwill and intangible  assets
           that have indefinite useful lives, and requires periodic  evaluations
           of impairment of goodwill  balances and intangible  assets.  SFAS 142
           also requires that  intangible  assets with definite  useful lives be
           amortized  over  their  respective  estimated  useful  lives to their
           estimated  residual values, and reviewed for impairment in accordance
           with SFAS No.  121,  "Accounting  for the  Impairment  of  Long-Lived
           Assets  and for  Long-Live  Assets  to be  Disposed  Of." SFAS 142 is
           effective for fiscal years beginning  after December 15, 2001.  There
           was no impact on the Company  financial  statements from the adoption
           of this statement on January 1, 2002.


                                       9
<PAGE>


           Statement of Financial  Accounting Standards No. 144, "Accounting for
           the  Impairment  or  Disposal of  Long-Lived  Assets"  ("SFAS  144"),
           addresses  financial  accounting  and reporting for the impairment or
           disposal of  long-lived  assets.  SFAS 144  supercedes  SFAS No. 121,
           "Accounting   for  the  Impairment  of  Long-Lived   Assets  and  for
           Long-Lived  Assets to Be Disposed Of" and is effective  for financial
           statements issued for fiscal years beginning after December 15, 2001.
           There was no  impact on the  Company  financial  statements  from the
           adoption of this statement on January 1, 2002.



                                       10
<PAGE>


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

OVERVIEW

The  Company  was  incorporated  in  1992  and  until  July  30,  1999,  devoted
substantially  all of its resources to the  development and application of novel
yeast-based and other drug discovery technologies. On July 30, 1999, the Company
sold its drug discovery assets and ceased its internal drug discovery operations
and research efforts for collaborative partners.

The Company has incurred  operating losses in each year since its inception.  At
June 30, 2002, the Company had an  accumulated  deficit of  approximately  $34.6
million.  The Company's losses have resulted  principally from costs incurred in
connection  with its research and  development  activities  and from general and
administrative costs associated with the Company's operations.  These costs have
exceeded the Company's  revenues and interest income. As a result of the sale of
its drug  discovery  assets and the  cessation  of its internal  drug  discovery
operations and research efforts for collaborative  partners,  the Company ceased
to have  research  funding  revenues  and  substantially  reduced its  operating
expenses.  The Company expects to generate  revenues in the future only if it is
able to license its technologies.

RESULTS OF OPERATIONS

THREE MONTHS ENDED JUNE 30, 2002 AND JUNE 30, 2001

REVENUES

There were no revenues for the three months ended June 30, 2002 and 2001.

COSTS AND EXPENSES

General and  administrative  expenses  were  $277,835 for the three months ended
June 30, 2002 compared to $407,641 for the same period in 2001.  The decrease is
attributable   primarily   to  a  decrease  of  $105,000  in  patent  costs  and
professional fees.

For the three months ended June 30, 2002,  the Company  recognized net income of
$725 in its investment in Laurel Partners Limited Partnership  ("Laurel").  Such
income for the same period in 2001 was $2,165.

OTHER INCOME

Interest income for the three months ended June 30, 2002 was $85,619 compared to
interest  income of  $234,793  for the same  period in 2001.  This  decrease  is
attributable primarily to lower interest rates earned on invested funds.

NET (LOSS) INCOME

Net loss for the three months  ended June 30, 2002 was $191,491  compared to the
net loss of $170,683 for the same period in 2001.  This increase in net loss can
be attributed primarily to the decrease in interest income offset in part by the
decrease in general and administrative expenses.


                                       11
<PAGE>


RESULTS OF OPERATIONS

SIX MONTHS ENDED JUNE 30, 2002 AND JUNE 31, 2001

REVENUES

Revenues for the six months ended June 30, 2002 and 2001 were $100,000  which is
the annual maintenance fee from OSI.

COSTS AND EXPENSES

General and administrative  expenses were $541,545 for the six months ended June
30,  2002  compared to $648,905  for the same  period in 2001.  The  decrease is
attributable primarily to a decrease in patent costs and professional fees.

For the six months ended June 30,  2002,  the Company  recognized  net income of
$1,407 in its investment in Laurel.  Such income for the same period in 2001 was
$1,979.

OTHER INCOME

Interest income for the six months ended June 30, 2002 was $180,187  compared to
interest  income of  $529,494  for the same  period in 2001.  This  decrease  is
attributable primarily to lower interest rates earned on invested funds.

Pursuant  to a court  order,  the Company  received in February  2001 a $155,402
reimbursement  of SIBIA  litigation  costs  offset by legal  costs  incurred  of
$29,786.

NET (LOSS) INCOME

Net loss for the six months  ended June 30,  2002 was  $259,951  compared to net
income of $108,181 for the same period in 2001.  This decrease can be attributed
primarily to the decrease in interest  income and the receipt,  only in 2001, of
the net reimbursement of SIBIA litigation costs,  offset in part by the decrease
in general and administrative expenses.

LIQUIDITY AND CAPITAL RESOURCES

At June 30, 2002 the Company held cash and cash  equivalents  of $24.1  million.
The Company's working capital at June 30, 2002 was $24.0 million.

The Company believes that its existing capital resources, together with interest
income,  will be sufficient to support its  operations  through the end of 2003.
This  forecast  of the  period of time  through  which the  Company's  financial
resources  will be  adequate  to support  its  operations  is a  forward-looking
statement that may not prove accurate and, as such, actual results may vary. The
Company's  capital  requirements  may vary as a result of a number  of  factors,
including  the  transactions,  if any,  arising  from the  Company's  efforts to
acquire  technologies  or products or to acquire or invest in companies  and the
expenses of pursuing such transactions.


                                       12
<PAGE>


Item 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Company's earnings and cash flows are subject to fluctuations due to changes
in interest  rates  primarily  from its investment of available cash balances in
money  market funds with  portfolios  of  investment  grade  corporate  and U.S.
government securities.  The Company does not believe it is materially exposed to
changes in interest rates.  Under its current  policies the Company does not use
interest  rate  derivative  instruments  to manage  exposure  to  interest  rate
changes.


PART II - OTHER INFORMATION

Item 1.  Legal Proceedings

         Nothing to report.

Item 2.  Changes in Securities and Use of Proceeds

         Nothing to report.

Item 3.  Defaults Upon Senior Securities

         Nothing to report

Item 4.  Submission of Matters to a Vote of Security Holders

         Nothing to report

Item 5.  Other Information

         Nothing to report

Item 6.  Exhibits and Reports on Form 8-K.

         (a)  The  Exhibit  listed in the  Exhibit  Index is  included  in  this
               report.

         (b)  Reports on Form 8-K.

              None



                                       13
<PAGE>


                                   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.

                           CADUS PHARMACEUTICAL CORPORATION
                           (REGISTRANT)


Date: August 14, 2002      By:   /s/ Russell D. Glass
                              --------------------------------------------------
                               Russell D. Glass
                               President and Chief Executive Officer (Authorized
                               Officer and Principal Financial Officer)




                                       14
<PAGE>


                                  EXHIBIT INDEX


The following exhibit is filed as part of this Quarterly Report on Form 10-Q:

Exhibit No.                                Description
-----------                                -----------

99.1                                       Certification Pursuant to 18 U.S.C.
                                           Section 1350, as Adopted Pursuant to
                                           Section 906 of the Sarbanes-Oxley Act
                                           of 2002




                                       15