<PAGE>

                       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 quarterly period ended  June 30, 1997
                                                  -------------



[   ]           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 in its Charter)

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

777 Old Saw Mill River Road, Tarrytown, New York               10591-6705
------------------------------------------------        ----------------------
     (Address of Principal Executive Offices)                  (Zip Code)

Registrant's Telephone Number, Including Area Code          (914) 345-3344
                                                        ----------------------


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, $.01 par value, outstanding
as of July 16, 1997 was 12,416,119.

<PAGE>

                        CADUS PHARMACEUTICAL CORPORATION

                                      INDEX

<TABLE>
<CAPTION>
                                                                                                  Page No.
<S>                                                                                               <C> 

PART I       --   CONDENSED FINANCIAL INFORMATION

             Item 1.       Condensed Financial Statements

                           Condensed Balance Sheets - June 30, 1997 and December 31, 1996                3

                           Condensed Statements of Operations - Three and six months
                           ended June 30, 1997 and 1996                                                  4

                           Condensed Statements of Cash Flows - Six months ended
                           June 30, 1997 and 1996                                                        5

                           Notes to Condensed Financial Statements                                     6-8

             Item 2.       Management's Discussion and Analysis of Financial
                           Condition and Results of Operations                                        9-11


PART II      --   OTHER INFORMATION

             Item 1.       Legal Proceedings                                                            12

             Item 2.       Changes in Securities                                                        12

             Item 3.       Defaults Upon Senior Securities                                              12

             Item 4.       Submission of Matters to a Vote of Security Holders                          12

             Item 5.       Other Information                                                            13

             Item 6.       Exhibits and Reports on Form 8-K                                             13


SIGNATURES                                                                                              14

EXHIBIT INDEX                                                                                           15
</TABLE>

                                       2

<PAGE>

                        Cadus Pharmaceutical Corporation

                            Condensed Balance Sheets

<TABLE>
<CAPTION>
                                                                                June 30,          December 31,
                                                                                  1997                1996
                                                                              ------------        ------------
<S>                                                                           <C>                 <C>         
                                     Assets

Current assets:
     Cash and cash equivalents                                                $ 38,054,350        $ 43,152,677
     Prepaid and other current assets                                              158,887             263,052
                                                                              ------------        ------------
               Total current assets                                             38,213,237          43,415,729

Restricted cash                                                                     40,000             118,000
Fixed assets, net of accumulated depreciation and amortization of
    $2,005,778 at June 30, 1997 and $1,488,015 at December 31, 1996              3,297,396           2,955,530
Investments in other ventures                                                    2,010,643             310,660
Other assets, net                                                                  713,759             486,939
                                                                              ------------        ------------
               Total assets                                                   $ 44,275,035        $ 47,286,858
                                                                              ============        ============

                      Liabilities and Stockholders' Equity

Current liabilities:
       Deferred revenue                                                       $         --        $  1,000,000
       Accounts payable, accrued expenses and other current liabilities            927,405             926,454
       Line of credit and loans payable to bank-current portion                         --              12,601
                                                                              ------------        ------------
               Total current liabilities                                           927,405           1,939,055

       Loans payable to bank                                                            --              16,474
       Note payable to partnership                                                 150,000             150,000
                                                                              ------------        ------------
               Total liabilities                                                 1,077,405           2,105,529

Commitments and contingencies

Stockholders' equity:
Common stock                                                                       124,143             122,029
Additional paid-in capital                                                      54,238,980          53,790,704
Accumulated deficit                                                            (10,865,418)         (8,431,329)
Treasury stock                                                                    (300,075)           (300,075)
                                                                              ------------        ------------

               Total stockholders' equity                                       43,197,630          45,181,329
                                                                              ------------        ------------


               Total liabilities and stockholders' equity                     $ 44,275,035        $ 47,286,858
                                                                              ============        ============
</TABLE>

          See accompanying notes to the condensed financial statements

                                       3

<PAGE>

                        Cadus Pharmaceutical Corporation

                       Condensed Statements of Operations

<TABLE>
<CAPTION>
                                                     Three Months Ended                      Six Months Ended
                                                          June 30,                                June 30,
                                                  1997                1996                1997                1996
                                              ------------        ------------        ------------        ------------
<S>                                           <C>                 <C>                  <C>                <C>         
Revenues, principally from
    related parties                           $  2,271,865        $  1,625,001          $4,161,786        $  3,250,002
                                              ------------        ------------        ------------        ------------

Costs and expenses:
    Research and development costs               3,128,962           1,783,294           5,368,530           3,437,685
    General and administrative expenses          1,106,192             302,839           1,988,600             620,516
                                              ------------        ------------        ------------        ------------

       Total costs and expenses                  4,235,154           2,086,133           7,357,130           4,058,201
                                              ------------        ------------        ------------        ------------

Operating loss                                  (1,963,289)           (461,132)         (3,195,344)           (808,199)
                                              ------------        ------------        ------------        ------------

Interest income                                    541,782             364,610           1,087,143             723,945
Interest expense                                     1,351              31,004               2,754              68,859
                                              ------------        ------------        ------------        ------------

       Interest income, net                        540,431             333,606           1,084,389             655,086

Equity in other ventures (note 2)                 (283,905)                 --            (300,017)                 --
                                              ------------        ------------        ------------        ------------
Loss before income taxes                        (1,706,763)           (127,526)         (2,410,972)           (153,113)

State and local taxes                               23,117               6,000              23,117              23,580
                                              ------------        ------------        ------------        ------------
Net loss                                      $ (1,729,880)       $   (133,526)       $ (2,434,089)       $   (176,693)
                                              ============        ============        ============        ============
Net loss per share (note 3)                   $      (0.14)       $      (0.10)       $      (0.20)       $      (0.03)

Shares used in calculation of net loss
    per share (note 3)                          12,174,009           1,331,676          12,131,003           5,204,317
</TABLE>

          See accompanying notes to the condensed financial statements

                                        4

<PAGE>

                        Cadus Pharmaceutical Corporation

                       Condensed Statements of Cash Flows

<TABLE>
<CAPTION>
                                                                                                Six Months Ended
                                                                                                     June 30,
                                                                                             1997                 1996
                                                                                         ------------        ------------
<S>                                                                                      <C>                 <C>          
Cash flows from operating activities:

Net loss                                                                                 $ (2,434,089)       $   (176,693)
Equity in other ventures                                                                      300,017                  --
Adjustments to reconcile net loss to net cash used in operating activities:
           Depreciation and amortization                                                      627,667             347,897
           Changes in assets and liabilities:
                Decrease (increase) in prepaid and other current assets                       104,165            (541,510)
                Decrease (increase) in other assets                                             4,355            (148,099)
                Decrease in deferred revenue                                               (1,000,000)                 --
                Increase (decrease) in accounts payable,accrued expenses and other
                    current liabilities                                                           951            (402,081)
                                                                                         ------------        ------------

                         Net cash used in operating activities                             (2,396,934)           (920,486)
                                                                                         ------------        ------------

Cash flows from investing activities:

            Acquisition of fixed assets                                                      (950,050)           (461,323)
            Decrease in restricted cash                                                        78,000                  --
            Stockholder borrowing                                                               3,881               3,881
            Investment in other ventures                                                   (2,000,000)                 --
            Patent costs                                                                     (254,539)            (57,729)
                                                                                         ------------        ------------

                         Net cash used in investing activities                             (3,122,708)           (515,171)
                                                                                         ------------        ------------

Cash flows from financing activities:

            Payments on bank loans                                                            (29,075)             (8,508)
            Proceeds from issuance of common stock upon exercise of stock options             450,390              11,425
                                                                                         ------------        ------------

                         Net cash provided by financing activities                            421,315               2,917
                                                                                         ------------        ------------

                         Net decrease in cash and cash equivalents                         (5,098,327)         (1,432,740)


 Cash and cash equivalents at beginning of period                                          43,152,677          25,682,920
                                                                                         ------------        ------------

 Cash and cash equivalents at end of period                                              $ 38,054,350        $ 24,250,180
                                                                                         ============        ============
</TABLE>

          See accompanying notes to the condensed financial statements

                                        5

<PAGE>

                        Cadus Pharmaceutical Corporation

                     Notes to Condensed Financial Statements

(1)   Organization and Basis of Preparation

      The information presented as of June 30, 1997 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
      generally accepted accounting principles 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, 1996 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,
      1996.

      Through December 31, 1996, the Company reported as a development stage
      enterprise in accordance with the Financial Accounting Standards Board's
      ("FASB") Statement of Financial Accounting Standards ("SFAS") No. 7,
      "Accounting and Reporting by Development Stage Enterprises". Management
      believes it has commenced its principal operations and these operations
      have generated significant revenues and therefore, beginning with the
      three-month period ended March 31, 1997, the Company no longer reports as
      a development stage enterprise.

      The results of operations for the six-month period ended June 30, 1997 are
      not necessarily indicative of the results to be expected for the year
      ending December 31, 1997.

(2)   Investments in Other Ventures

      Partnership Interest

      In December 1996, the Company contributed a $310,660 in exchange for a 89%
      limited partnership interest in Laurel Partners Limited Partnership
      ("Laurel"), a limited partnership of which a stockholder of the Company is
      the general partner. The investment is accounted for under the equity
      method with the recognition of losses limited to the Company's capital
      contributions. For the three and six month periods ended June 30, 1997,
      the Company recognized $126,092 and $142,204, respectively in losses
      related to the investment.

      Investment in Axiom Biotechnologies

      In May 1997, the Company purchased $2.0 million of convertible preferred
      stock in Axiom Biotechnologies Inc. ("Axiom"), representing approximately
      26% of the outstanding shares of Axiom on an as converted basis. As part

      of the arrangement, Axiom has agreed to deliver and license to Cadus its
      first High Throughput Pharmacological Screening (HT-PSTM) System. The
      Company has agreed to purchase an additional $2.0 million of convertible
      preferred stock in Axiom if the Company receives and accepts Axiom's
      HT-PSTM System on or prior to May 29, 1998. This would increase the
      Company's equity interest in Axiom to approximately 38% of Axiom's then
      outstanding shares on an as converted basis. The investment is accounted
      for under the equity method with the Company recognizing 100% of Axiom's
      net losses to the extent that the Company's investment is funding those
      losses. For the three and six month periods ended June 30, 1997, the
      Company recognized $157,813 in losses generated by Axiom.

                                       6

<PAGE>

(3)   Net Loss Per Share

      Net loss per share for the three and six month periods ended June 30, 1997
      and the three month period ended June 30, 1996, is computed on the basis
      of the net loss for the period divided by the weighted average number of
      shares of common stock outstanding during the period. Common stock
      issuable upon exercise of outstanding stock options is excluded from the
      calculation as such inclusion would be anti-dilutive.

      Net loss per share for the three months ended March 31, 1996 is computed
      using the weighted average number of shares of common stock outstanding.
      Pursuant to Securities and Exchange Commission Staff Accounting Bulletin
      No. 83, the Series B Convertible Preferred Stock (using the if-converted
      method) and stock options (using the treasury stock method and the initial
      public offering price) issued at prices substantially below the public
      offering price during the 12-month period prior to the offering have been
      included in the calculation. Furthermore, common equivalent shares from
      convertible preferred stock issued prior to the 12-month period preceding
      the offering that converted upon the completion of the Company's initial
      public offering are included in the calculation (using the if-converted
      method) from the original date of issuance. Common equivalent shares from
      stock options issued prior to the 12-month period preceding the offering
      are excluded from the computation as their effect is anti-dilutive.

      For the three-month period ended June 30, 1996, common equivalent shares
      from stock options and convertible preferred stock are excluded from the
      computation as their effect is anti-dilutive.

(4)   Supplemental Cash Flow Information

                                                      Six Months
                                                    ended June 30,
                                                1997                1996
                                             -------------------------------
      Cash payments for:
      Interest.............................    $2,754              $68,859
                                               ======              =======


      Income taxes.........................    $23,117             $23,580
                                               =======             =======


(5)   Research Collaborations

      Bristol-Myers Squibb

      In accordance with its Research Collaboration and License Agreement dated
      July 26, 1994, Bristol-Myers Squibb Company ("BMS") has agreed to provide
      funding to the Company for the conduct of research programs in an amount
      of up to $4.0 million each year during the term of the research programs
      which was due to expire in July 1997. In January 1997, BMS exercised its
      option to extend its collaboration with the Company for an additional two
      years through July 1999.

      SmithKline Beecham

      In February 1997, the Company entered into a research collaboration and
      license agreement with SmithKline Beecham ("SmithKline"). During the term
      of the research collaboration, which expires in February 2002, the Company
      will seek to identify ligands and to elucidate the function of orphan G
      protein-coupled receptors included within the collaboration and create
      high-throughput screens to discover small molecular agonists and
      antagonists to these receptors.

                                       7
<PAGE>

      During the term of the research collaboration, SmithKline is required to
      provide the Company with research funding of $3.0 million each year,
      adjusted for inflation, and certain other payments, including a $2.0
      million payment in February 1998. SmithKline is also required to make
      payments to the Company upon the achievement of certain research
      milestones and upon the achievement by SmithKline of certain drug
      development milestones. SmithKline is also required to pay the Company
      royalties on the sale of drugs developed through the use of the Company's
      drug discovery technologies. The Company has co-promotion rights in North
      America for certain products that may result from the collaboration and
      rights to certain potential products that SmithKline may choose not to
      develop.

      SmithKline has the right to extend the term of the research collaboration
      for between two and five years by notice to the Company given prior to
      February 25, 2001. SmithKline has the right to terminate the research
      collaboration after February 25, 1999 (or later under certain
      circumstances) ("Evaluation Date") if (i) the Company fails to meet
      certain scientific objectives in connection with the conduct of the
      research collaboration or (ii) fails to perform its obligations in the
      conduct of the research collaboration in any material respect and does not
      cure such failure within a period of 60 days after receiving notice
      thereof. In the event of such termination, SmithKline has no further
      obligation to provide the Company with funding for the research
      collaboration.


      In February 1997, the Company and SmithKline Beecham Corporation entered
      into a stock purchase agreement pursuant to which the Company has the
      option to sell to SmithKline Beecham Corporation (i) shares of the
      Company's common stock having a then fair market value of $5.0 million
      during a 90-day period commencing on February 25, 1998 and (ii) shares of
      the Company's common stock having a then fair value of $5.0 million,
      during a 90-day period commencing on the date certain scientific
      objectives are achieved (subject to the Company achieving such objectives
      prior to the Evaluation Date and meeting certain financial requirements).
      In addition, SmithKline Beecham Corporation has the right, at its option,
      to purchase up to $5.0 million worth of shares of the Company's common
      stock at 150% of the then fair market value in lieu of making certain
      research milestone payments. The Company granted SmithKline Beecham
      Corporation certain registration rights with respect to shares of the
      Company's Common Stock which SmithKline Beecham Corporation may purchase
      pursuant to the stock purchase agreement.

(6)   Subsequent Event

      On July 14, 1997, the Company announced plans to relocate its Lakewood,
      Colorado operations to New York. Currently, eleven scientists and one
      administrative person are employed at the Colorado facility. The Company
      expects to complete the relocation by September 30, 1997 at an estimated
      cost of $400,000 to $800,000.

(7)   Recently Issued Accounting Standards

      In February 1997, the FASB issued SFAS No. 128, "Earnings Per Share" which
      specifies the computation, presentation, and disclosure requirements for
      earnings per share (EPS) for entities with publicly held common stock or
      potential common stock. SFAS No. 128 replaces the presentation of primary
      EPS and fully diluted EPS with basic EPS and diluted EPS. It also requires
      dual presentation of basic and diluted EPS on the face of the income
      statement for all entities with complex capital structures and requires
      reconciliation of the numerator and denominator of the basic EPS
      computation to the numerator and denominator of the diluted EPS
      computation.

      SFAS No. 128 is effective for financial statements for both interim and
      annual periods ending after December 15, 1997. It is not expected that the
      adoption of this statement will have a material impact on the Company's
      financial position or operating results.

                                       8


<PAGE>

                      MANAGEMENT'S DISCUSSION AND ANALYSIS
                OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Overview

      The Company was incorporated in 1992 and has devoted substantially all of
      its resources to the development and application of novel yeast-based and
      signal transduction drug discovery technologies. To date, all of the
      Company's revenues have resulted from research funding provided by its
      collaborative partners.

      The Company has incurred operating losses in each year since its inception
      and net losses of approximately $2.4 million during the six months ended
      June 30, 1997. At June 30, 1997, the Company had an accumulated deficit of
      approximately $10.9 million. The Company's losses have resulted
      principally from costs incurred in research and development and from
      general and administrative costs associated with the Company's operations.
      These costs have exceeded the Company's revenues and interest income. The
      Company expects to incur substantial additional operating losses over the
      next several years as a result of increases in its expenses for research
      and product development.

Results of Operations

      Six Months Ended June 30, 1997 and June 30, 1996

      Revenues

      Revenues for the six months ended June 30, 1997 increased to $4.2 million
      from $3.3 million for the same period in 1996. This increase was
      attributable to the commencement in February 1997 of research funding from
      SmithKline Beecham ("Smithkline"), one of the Company's collaborative
      partners.

      Operating Expenses

      The Company's research and development expenses for the six months ended
      June 30, 1997 increased to $5.4 million from $3.4 million for the same
      period in 1996. This increase was attributable primarily to increases in
      staffing and supplies for the SmithKline collaboration and the Company's
      internal programs, including expansion of its chemistry and bioinformatics
      capabilities, as well as facilities expenses in connection with the
      Company's occupancy of additional laboratory space.

      General and administrative expenses for the six months ended June 30, 1997
      increased to $2.0 million from $621,000 for the same period in 1996. This
      increase was attributable primarily to increased legal expenses, the
      hiring of management personnel, and the increase in the Company's
      directors and officers liability insurance premium and other
      administrative expenses resulting from the regulatory requirements of
      being a public company.


      Equity in Other Ventures

      Equity in other ventures decreased as a result of losses associated with
      the Company's two equity investments. The Company recognized losses of
      $142,204 and $157,813 for the six months ended June 30, 1997 in connection
      with its investments in Laurel Partners Limited Partnership and Axiom
      Biotechnologies Inc., respectively.

                                       9

<PAGE>

      Interest Income

      Net interest income for the six months ended June 30, 1997 increased to
      $1.1 million from $655,000 for the same period in 1996. This increase
      related primarily to interest earned on the net proceeds from the
      Company's initial public offering as well as the reduction in interest
      expense on the line of credit, which was repaid in September 1996.

      Net Loss

      The net loss for the six months ended June 30, 1997 increased to $2.4
      million from $177,000 for the same period in 1996. The increase can be
      attributed to an increase in the operating expenses of the Company as
      described above, which was partially offset by increases in revenues and
      interest income.

      Three Months Ended June 30, 1997 and June 30, 1996

      Revenues

      Revenues for the three months ended June 30, 1997 increased to $2.3
      million from $1.6 million for the same period in 1996. This increase was
      attributable to the commencement in February 1997 of research funding from
      SmithKline, one of the Company's collaborative partners.

      Operating Expenses

      The Company's research and development expenses for the three months ended
      June 30, 1997 increased to $3.1 million from $1.8 million for the same
      period in 1996. This increase was attributable primarily to increases in
      staffing and supplies for the SmithKline collaboration and the Company's
      internal programs, including expansion of its chemistry and bioinformatics
      capabilities, as well as facilities expenses in connection with the
      Company's occupancy of additional laboratory space.

      General and administrative expenses for the three months ended June 30,
      1997 increased to $1.1 million from $303,000 for the same period in 1996.
      This increase was attributable primarily to increased legal expenses, the
      hiring of management personnel, and the increase in the Company's
      directors and officers liability insurance premium and other
      administrative expenses resulting from the regulatory requirements of
      being a public company.


      Interest Income

      Net interest income for the three months ended June 30, 1997 increased to
      $540,000 from $334,000 for the same period in 1996. This increase related
      primarily to interest earned on the net proceeds from the Company's
      initial public offering as well as the reduction in interest expense on
      the line of credit, which was repaid in September 1996.

      Equity in Other Ventures

      Equity in other ventures decreased as a result of losses associated with
      the Company's two equity investments. The Company recognized losses of
      $126,092 and $157,813 for the three months ended June 30, 1997 in
      connection with its investments in Laurel Partners Limited Partnership and
      Axiom Biotechnologies Inc., respectively.

      Net Loss

      The net loss for the three months ended June 30, 1997 increased to $1.7
      million from $134,000 for the same period in 1996. The increase can be
      attributed to an increase in the operating expenses of the Company as
      described above, which was partially offset by increases in revenues and
      interest income.

                                       10

<PAGE>

      Liquidity and Capital Resources

      At June 30, 1997, the Company's cash and cash equivalents totaled $38.1
      million. The Company's working capital at June 30, 1997 was $37.3 million.

      In May 1997, the Company purchased $2.0 million of convertible preferred
      stock in Axiom Biotechnologies Inc. ("Axiom"). The Company has agreed to
      purchase an additional $2.0 million of convertible preferred stock in
      Axiom if the Company receives and accepts Axiom's High Throughput
      Pharmacological Screening System on or prior to May 29, 1998.

      The Company invested $950,000 in property and equipment during the six
      months ended June 30, 1997. The Company expects capital expenditures to
      increase over the next several years as it expands facilities to support
      the planned expansion of research and development efforts.

      The Company intends to increase its expenditures substantially over the
      next several years to enhance its technologies and pursue internal
      proprietary drug discovery programs. The Company believes that its
      existing capital resources, together with interest income and future
      payments due under its research collaborations, will be sufficient to
      support its current and projected funding requirements through the end of
      2000. The Company's capital requirements may vary as a result of a number
      of factors, including the progress of its drug discovery programs,
      competitive and technological developments, the continuation of its

      existing collaborative agreements and the establishment of additional
      collaborative agreements, and the progress of the development efforts of
      the Company's corporate partners. The Company expects that it will require
      significant additional financing in the future, which it may seek to raise
      through public or private equity offerings, debt financing or additional
      corporate partnerships. No assurance can be given that such additional
      financing will be available when needed or that, if available, such
      financing will be obtained on terms favorable to the Company. To the
      extent that additional capital is raised through the sale of equity or
      convertible debt securities, the issuance of such securities could result
      in dilution to the Company's stockholders. The Company's forecast of the
      period of time through which its financial resources will be adequate to
      support its operations is forward-looking information, and, as such,
      actual results may vary.

                                       11

<PAGE>

PART II - OTHER INFORMATION

Item 1.           Legal Proceedings

                  Nothing to report.

Item 2.           Changes in Securities

                  Nothing to report.

Item 3.           Defaults Upon Senior Securities

                  Nothing to report.

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

                  On June 19, 1997, the Company held its annual meeting of
                  stockholders in Tarrytown, New York. The holders of 11,237,323
                  shares of Common Stock were present or represented by proxy
                  and, accordingly, a quorum was present and matters were voted
                  on as follows:

                  (a) The following persons were re-elected directors of the
                  Company:

                                               Votes For      Votes Withheld
                                               ---------      --------------
                    Theodore Altman            11,080,539         156,784
                    Harold First               11,073,239         164,084
                    Carl C. Icahn              11,080,699         156,624
                    Jeremy M. Levin            11,229,306           8,017
                    Peter S. Liebert           11,081,939         155,384
                    Robert J. Mitchell         11,072,439         164,884
                    Lawrence D. Muschek        11,229,606           7,717
                    Mark H. Rachesky           10,339,011         898,312

                    Leon E. Rosenberg          11,229,566           7,757
                    Nicole Vitullo             11,229,566           7,757
                    Samuel D. Waksal           11,223,606          13,717
                    Jack G. Wasserman          11,081,139         156,184

                  (b) The proposal to approve the amendment to the Company's
                  1996 Incentive Plan (the "Plan") that (i) increases the
                  maximum number of shares of Common Stock that may be the
                  subject of awards under the Plan by 500,000 from 333,334
                  shares to 833,334 shares and (ii) provides that directors will
                  be eligible to receive awards under the Plan was approved by
                  the stockholders. 8,735,947 shares of Common Stock voted for
                  the proposal, 940,057 shares voted against the proposal and
                  3,540 shares abstained. There were 1,557,779 broker non-votes
                  with respect to the proposal.

                  (c) The proposal to ratify the grant of stock options to nine
                  non-employee directors to purchase an aggregate of 108,000
                  shares of Common Stock was approved by the stockholders.
                  8,711,446 shares of Common Stock voted for the proposal,
                  964,168 shares voted against the proposal and 3,930 shares
                  abstained. There were 1,557,779 broker non-votes with respect
                  to the proposal.

                                       12

<PAGE>

Item 5.           Other Information

                  Nothing to report.

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

                  (a)      The exhibits listed in the Exhibit Index are 
                           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, 1997    By
                           ----------------------------------------------------
                           James S. Rielly
                           Director of Finance, Controller and Treasurer
                           (Authorized Officer and Principal Financial Officer)


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<PAGE>

                                  EXHIBIT INDEX


The following exhibits are filed as part of this Quarterly Report on Form 10-Q:

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

                     11             Computation of Net Loss Per Share

                     27             Financial Data Schedule


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