<PAGE>

================================================================================
                    U.S. SECURITIES AND EXCHANGE COMMISSION
                            Washington, D.C. 20549

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

                                   FORM 10-Q


[X] QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT
                                    OF 1934
                 For the quarterly period ended March 31, 2001

                                      or

[_] TRANSITION REPORT UNDER SECTION 13 OR 15 (d) OF THE EXCHANGE ACT OF 1934
                    For the transition period from       to

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

                        Commission file number  0-27914


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

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

        Delaware                                         34-1697351
        --------                                         ----------
(State of incorporation)                   (I.R.S. Employer Identification No.)

                             2950 Wilderness Place
                           Boulder, Colorado  80301
                   (Address of principal executive offices)

                Registrant's telephone number:  (303) 449-6500

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

Check 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 the registrant's common stock, par value $0.01 per
share, outstanding as of May 4, 2001 was 16,374,503.
<PAGE>

                        RIBOZYME PHARMACEUTICALS, INC.
                              INDEX TO FORM 10-Q


PART 1 - FINANCIAL INFORMATION                                            PAGE
                                                                          ----
Item 1.  Financial Statements


         Condensed Balance Sheets as of March 31, 2001 (unaudited) and
         December 31, 2000..............................................   3

         Condensed Statements of Operations - Three Months Ended
         March 31, 2001 and 2000 (unaudited)............................   4

         Condensed Statements of Cash Flows - Three Months Ended
         March 31, 2001 and 2000 (unaudited)............................   5

         Notes to Condensed Financial Statements (unaudited)............   6

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

Item 3.  Quantitative and Qualitative Disclosures About Market Risk.....  13

PART II - OTHER INFORMATION

Item 2.  Changes in Securities and Use of Proceeds......................  13

Item 6.  Exhibits and Reports on Form 8-K...............................  14

SIGNATURES..............................................................  15

Exhibit Index...........................................................  16


                                       2
<PAGE>

PART I. FINANCIAL INFORMATION
ITEM I. FINANCIAL STATEMENTS

                        RIBOZYME PHARMACEUTICALS, INC.
                           CONDENSED BALANCE SHEETS


                                    ASSETS
                                    ------
                                                   March 31,      December 31,
                                                     2001            2000
                                                 -------------    ------------
                                                  (unaudited)
Current assets
--------------
  Cash and cash equivalents                      $  36,815,249    $ 32,170,518
  Securities available-for-sale                     17,268,712      32,304,162
  Accounts receivable                                3,268,543       1,278,161
  Accounts receivable-joint venture                  3,920,015       1,972,788
  Accounts receivable-related parties                  593,665         344,934
  Prepaid expenses and other current assets            304,910         277,623
                                                 -------------    ------------
Total current assets                                62,171,094      68,348,186

Property, plant and equipment, net                   3,911,626       3,566,366

Notes receivable-related parties                       519,750         214,750
Deferred patent costs, net                           4,902,052       4,858,036
Investment in joint venture                          3,730,098       6,373,545
Other assets                                           537,110         536,110
                                                 -------------    ------------

Total assets                                     $  75,771,730    $ 83,896,993
                                                 =============    ============

                     LIABILITIES AND STOCKHOLDERS' EQUITY
                     ------------------------------------

Current liabilities
-------------------
  Accounts payable-trade                         $   1,965,692    $  1,085,197
  Accrued expenses                                   3,401,263       1,860,813
  Deferred revenue, current portion-related
  parties                                              400,000         400,000
                                                 -------------    ------------
Total current liabilities                            5,766,955       3,346,010

Deferred revenue, long-term portion-related
  parties                                              700,007         800,006
Convertible debt-joint venture                       2,823,358       2,743,213
Convertible debt                                     2,040,000       1,013,333

Stockholders' equity
--------------------
  Preferred stock                                          120             120
  Accreted preferred stock dividend                    907,723         716,456
  Common stock                                         163,336         162,615
  Additional paid-in capital                       175,255,178     175,099,769
  Deferred compensation and other                       (7,958)        (19,900)
  Accumulated deficit                             (111,876,989)    (99,964,629)
                                                 -------------    ------------
Total stockholders' equity                          64,441,410      75,994,431
                                                 -------------    ------------

Total liabilities and stockholders' equity       $  75,771,730    $ 83,896,993
                                                 =============    ============

See notes to condensed financial statements


                                       3
<PAGE>

                        RIBOZYME PHARMACEUTICALS, INC.
                      CONDENSED STATEMENTS OF OPERATIONS
                                  (Unaudited)

                                                    Three months ended
                                                         March 31,
                                                ---------------------------
                                                    2001           2000
                                                ------------    -----------
Revenues:
 Collaborative agreements                       $    536,304    $ 2,539,571
 Collaborative agreements-joint venture            1,302,513        972,251
 Collaborative agreements-related parties            278,445        358,044
                                                ------------    -----------
 Total revenues                                    2,117,262      3,869,866

Expenses:
 Research and development                         11,137,759      4,864,835
 General and administrative                        1,021,795      1,038,870
                                                ------------    -----------
Total expenses                                    12,159,554      5,903,705

Operating loss                                   (10,042,292)    (2,033,839)

Other income (expense):
 Interest income                                     877,460        247,689
 Interest expense                                   (106,813)      (138,039)
 Other income                                          2,732
 Equity in loss of unconsolidated affiliate       (2,643,447)    (1,797,826)
                                                ------------    -----------
Total other income (expense)                      (1,870,068)    (1,688,176)

Net loss                                         (11,912,360)    (3,722,015)

Accretion of dividends on preferred stock            191,267

Net loss applicable to common stock             $(12,103,627)   $(3,722,015)
                                                ============    ===========

Net loss per share (basic and diluted)          $      (0.74)   $     (0.31)
                                                ============    ===========

Shares used in computing net loss per share       16,291,660     11,875,081
                                                ============    ===========

See notes to condensed financial statements


                                       4
<PAGE>

                         RIBOZYME PHARMACEUTICALS, INC.
                       CONDENSED STATEMENTS OF CASH FLOWS
                                  (Unaudited)
<TABLE>
<CAPTION>
                                                           Three months ended
                                                                March 31,
                                                      ----------------------------
                                                          2001           2000
                                                      ------------   -------------
<S>                                                   <C>            <C>
Operating Activities
Net loss                                              $(11,912,360)  $ (3,722,015)
 Adjustments to reconcile net loss to
   net cash used in operating activities:
 Depreciation and amortization                             465,453        442,043
 Equity in loss of unconsolidated affiliate              2,643,447      1,797,826
 Compensation related to common stock and options                         681,133
 Compensation for forgiveness of notes
   receivable-related parties                               30,000         42,466
 Accrued interest included in convertible debt             106,812        137,322
 Expense related to issuance of warrants                   103,050
 Expense related to issuance of common stock               275,000
 Gain on disposal of equipment                               2,732
 Changes in operating assets and liabilities:
   Accounts receivable                                  (4,186,340)    (1,633,425)
   Prepaid expenses and other current assets                37,713       (317,663)
   Other assets                                             (1,000)            --
   Accounts payable-trade                                  880,495        568,129
   Accrued expenses                                      1,540,450        131,872
   Deferred revenue-related parties                        (99,999)       (99,998)
                                                      ------------   ------------
 Net cash used in operating activities                 (10,114,547)    (1,972,310)

Investing activities
 Additions to property, plant and equipment               (766,024)      (163,370)
 Additions to deferred patent costs                        (91,437)      (165,632)
 Net sales of securities available-for-sale             15,047,391      3,153,491
 Investment in unconsolidated affiliate                         --    (12,015,000)
 Loan advances-related parties                            (400,000)            --
                                                      ------------   ------------
 Net cash provided by (used) in investing
  activities                                            13,789,930     (9,190,511)

Financing activities
 Net proceeds from sale of common and preferred
  stock                                                    (30,652)    17,474,379
 Payments under loan facilities                                 --       (107,973)
 Borrowings under loan facilities                        1,000,000      1,000,000
                                                      ------------   ------------
 Net cash provided by financing activities                 969,348     18,366,406

Net increase in cash and cash equivalents                4,644,731      7,203,585
Cash and cash equivalents at beginning of period        32,170,518      9,749,822
                                                      ------------   ------------
Cash and cash equivalents at end of period            $ 36,815,249   $ 16,953,407
                                                      ============   ============
</TABLE>

See notes to condensed financial statements.


                                       5
<PAGE>

                        RIBOZYME PHARMACEUTICALS, INC.
                    NOTES TO CONDENSED FINANCIAL STATEMENTS
                                March 31, 2001
                                  (Unaudited)

Note 1:  Basis of Presentation

     The accompanying unaudited condensed financial statements have been
prepared in accordance with accounting principles generally accepted in the
United States for interim financial information and with the instructions to
Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all
of the information and footnotes required by generally accepted accounting
principles for complete financial statements. In the opinion of management, all
adjustments (consisting of normal recurring accruals) considered necessary for a
fair presentation have been included. Operating results for the three month
period ending March 31, 2001 are not necessarily indicative of the results that
may be expected for the year ended December 31, 2001. For further information,
refer to the financial statements and footnotes thereto included in our annual
report on Form 10-K for the year ended December 31, 2000.

     Certain amounts in the 2000 financial statements have been reclassified in
order to conform with the 2001 presentation.

Note 2:  Medizyme

     In January 2000, the Company formed a joint venture with Elan Corporation
(Elan) for the development and commercialization of HERZYME, the Company's
product to treat breast and other cancers. As part of this arrangement, the
Company licensed HERZYME and Elan licensed its MEDIPAD(R) drug delivery
technology to the joint venture, Medizyme Pharmaceuticals, Ltd. (Medizyme). The
MEDIPAD(R) system is a disposable continuous subcutaneous drug delivery system
that allows a patient to administer the drug at home. We filed an IND for
HERZYME in Canada in February 2001, which was approved in April 2001.

     Initial funding of Medizyme included $12.0 million from the Company and
$3.0 million from Elan. Estimated funding for Medizyme will require
approximately $15.0 million in additional operating and development costs and,
therefore, Elan has provided the Company with a $12.0 million credit facility on
a draw-down basis for the Company to use, if desired, to fund the Company's
portion of Medizyme operating costs over a 30-month period. The debt carries a
12% rate and may ultimately be converted into the Company's common stock at a
50% premium to the average price of the common stock for the 60 trading days
prior to the time of the applicable draw down on the credit facility.

     While the Company owns 80.1% of the outstanding stock of Medizyme, Elan and
its subsidiaries have retained significant minority investor rights that are
considered "participating rights", therefore the Company accounts for its
investment in Medizyme under the equity method of accounting. During the three-
month period ended March 31, 2001, the Company recognized $1.3 million in
contract revenues for research and development activities performed for
Medizyme. This amount is included in the Company's revenues as Collaborative
agreements-joint venture for the related period.

                                       6
<PAGE>

     The unaudited results of operations of Medizyme for the three-month period
ended March 31, 2001 are as follows (in thousands):

          Revenue                      $   --

          Research and development      2,050
          License fee                   1,250
                                       ------
          Net loss                     $3,300
                                       ======

Note 3:  Subsequent Event

     In May 2001, the Company announced the formation of a strategic alliance
with Archemix Corporation, a Massachusetts privately held biotechnology company,
that will allow both companies to capitalize on reciprocal intellectual property
in the field of proteomics and molecular diagnostics. Under the terms of the
agreement, Archemix received licenses and sublicenses to the Company's
intellectual property covering the allosteric ribozyme technology for use in
detecting proteins in connection with drug development and in a wide range of
molecular detection applications. In exchange for the licenses, the Company
received an equity position in Archemix, a seat on Archemix's Board of Directors
and a seat on the Scientific Advisory Board. In addition, the Company received a
license to Archemix's intellectual property covering allosteric ribozymes for
use in molecular diagnostic applications.

                                       7
<PAGE>

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

Forward-looking Statements

     Statements in this Form 10-Q, which are not strictly historical are
"forward-looking" statements which should be considered as subject to the many
uncertainties that exist in our operations and business environment. These
uncertainties, which include, among other things, the following: general
economic and business conditions; competition; technological advances; ability
to obtain rights to technology; ability to obtain and enforce patents; ability
to commercialize and manufacture products; ability to obtain collaborators;
ability to manufacture ribozymes in adequate amounts for its collaborations and
clinical trials; results of clinical studies; results of research and
development activities; business abilities and judgment of personnel;
availability of qualified personnel; changes in, or failure to comply with,
governmental regulations; ability to obtain adequate financing in the future;
and the like, are set forth in our Form S-3 registration statement which was
filed with the U.S. Securities and Exchange Commission on November 6, 2000 (File
No. 33-49400), a copy of which is available from us upon request.

Overview of our Business

     We are developing a new class of drugs based on engineered molecules called
"ribozymes." Ribozymes are a form of ribonucleic acid which have the ability to
cleave RNA, including mRNA and viral RNA thereby selectively inhibit protein
production and viral replication. Because many human diseases result from
abnormal protein production, ribozymes are expected to be useful in developing
pharmaceutical candidates for a broad range of human diseases. We are currently
in clinical development and preclinical testing for four product candidates and
expect to begin preclinical testing on one additional product candidate by the
end of 2001.

     We expect to initiate several Phase II clinical trials in 2001 for our lead
product candidate, ANGIOZYME, for the treatment of solid tumor cancers with
which we are in collaboration with Chiron. Also, we expect to initiate a Phase
II clinical trial in 2001 for HEPTAZYME, our product candidate for the treatment
of chronic Hepatitis C. In addition, in 2000 we formed a joint venture with Elan
to develop HERZYME, a treatment for breast and other cancers. We filed an IND in
Canada in February 2001 for HERZYME, which was approved in April 2001. Also, we
are in preclinical testing for HepBzyme, our product candidate for the treatment
of Hepatitis B.

     To date, we have committed substantially all our resources to our research
and product development programs. We have not generated any revenues from
product sales, nor do we anticipate generating any revenues in the foreseeable
future. Revenue recorded from our collaborative agreements consists of:

     .    Up-front revenue. Up-front non-refundable fees are fully recognized
          upon signing an agreement and are related to the value of the research
          at that point in time. Up-front revenue may also include a
          reimbursement to us of recent expenses related to product development
          which we incurred.

     .    Research revenue. Typically research revenue is based on the fully
          burdened cost of a researcher working on a collaboration. Rates are
          billed per employee, per year, pro-rated for time worked on a project.
          This revenue is typically invoiced on a quarterly basis, either up
          front or in arrears. Revenue is recognized ratably over the period,
          with the balance reflected as deferred revenue

                                       8
<PAGE>

          until earned. The revenue is typically recurring over the term of a
          collaboration.

     .    License revenue. License revenue is recognized ratably over the term
          of the license. Payments received in advance are recorded as deferred
          revenue until earned.

     .    Milestone revenue. Milestone revenue is recognized in full when the
          related milestone performance goal is achieved. Milestone revenue is
          typically not consistent or recurring in nature.

     Our revenue has consisted primarily of research revenue payments from our
collaborators. All revenues are either deferred as a liability or recognized
upon satisfying revenue criteria. As of March 31, 2001, all revenues that have
been recognized are earned, and no further obligation exists for recognized
revenue. We depend upon funding from external financing and corporate
collaborations for our research and product development programs and expect to
do so for the foreseeable future.

     We have not been profitable since inception and have an accumulated deficit
of $111.9 million as of March 31, 2001. Losses have resulted primarily from our
research and development programs. We expect to incur additional losses as
ANGIOZYME, HEPTAZYME, HERZYME and HepBzyme and other potential product
candidates advance through development and commercialization. In addition,
future milestone payments under some of our collaborations are contingent upon
our meeting particular research or development goals. The amount and timing of
future milestone payments are contingent upon the terms of each collaboration
agreement. In some instances, we may forfeit milestone payments if we fail to
accomplish a predetermined goal within a certain time frame. Therefore, we are
subject to significant variation in the timing and amount of our revenues and
results of operations from period to period.

     In 1998, we transferred our target discovery and validation technology to
Atugen in exchange for a substantial equity interest. We will continue our
existing target discovery and validation agreements with our collaborators by
subcontracting to Atugen the services to be performed. We currently own 31.6% of
Atugen and will record our share of any future profits. In 1999, we completely
expensed our investment in Atugen.

     Our revenues are denominated in U.S. dollars, therefore, we have not been
exposed to foreign currency translation risks and have not engaged in any
hedging instruments.

Results of Operations

Three Months Ended March 31, 2001 and 2000

     Collaborative revenues decreased to $2.1 million for the three months ended
March 31, 2001, from $3.9 million for the corresponding period in 2000. The
decrease is primarily due to the termination of the Eli Lilly collaboration.
During the first quarter of 2000, $1.1 million of revenues were recognized
related to the Eli Lilly collaboration, which was terminated when we repurchased
rights to HEPTAZYME in the third quarter of 2000. In addition, the Chiron
collaboration revenues have decreased by approximately $900,000 due to a shift
in costs related to the clinical trial expenses of ANGIOZYME. According to the
Chiron agreement, Chiron and RPI share equally in the clinical trial costs of
ANGIOZYME. During the first quarter of 2001, an increase in direct expenses,
such as third party manufacturing and clinical trial costs, were incurred for
ANGIOZYME in contrast to revenue recognized during the first quarter of 2000
which was for our researchers working on the project. Chiron reimbursement of
the direct third party expenses during the first quarter 2001 were recognized
and credited directly against research and development expenses. The third party
expenses were approximately $1.7 million for ANGIOZYME during the first quarter
of 2001. As a result, if Chiron

                                       9
<PAGE>

terminates the collaboration our expenses related to the development of
ANGIOZYME would likely increase. In addition, we earned revenues from Medizyme,
our joint venture with Elan for the preclinical and clinical development of
HERZYME, a ribozyme targeted at breast and other cancers. In February 2001, we
filed an IND in Canada for HERZYME and therefore activities related to the
project were scaled up in the first quarter of 2001 as compared to the first
quarter of 2000, which is when the collaboration began. Research revenue is
recognized for activities completed and no further obligation exists between us
and our partners for recognized revenues. Future research revenues related to
the joint development of our products will be variable and will depend on the
stage of research and preclinical and clinical development. In addition, during
the first quarter of 2001, $278,000 in revenue was recorded in connection to our
service agreement with Atugen. Per the service agreement, Atugen pays for
reagents and management and administrative services we provide to them. Atugen
revenues are earned by us as the products and services are provided. Future
revenues will depend on the level of activities performed by us. Generally,
revenue fluctuations result from changes in the number of funded research
projects as well as the timing and completion of contract milestones.

     Research and development expenses increased to $11.1 million for the three
months ended March 31, 2001, compared to $4.9 million for the corresponding
period in 2000. The increase in R&D expenses is primarily due to the increase in
contract services utilized to support our clinical trials. During the first
quarter of 2001, we incurred $6.3 million in third party contract manufacturing
costs to manufacture and distribute ANGIOZYME and HEPTAZYME to support our
current and planned clinical trials. In addition, we incurred expenses of
$416,000 and $264,000 to do pharmacology studies and clinical trials,
respectively during the first quarter of 2001. Increased expenses for the first
quarter of 2001 also included approximately $810,000 of expenses related to
increased staffing. Other expenses have increased accordingly, due to increased
staffing and the expansion of our development and clinical trial programs. We
expect research and development expenses, including pre-clinical studies and
clinical trials, to continue to increase as we expand our development programs
for ANGIOZYME, HEPTAZYME and HERZYME.

     Overall, general and administrative expenses remained approximately the
same at $1.0 million for each of the three months ended March 31, 2001 and 2000.
However, on-going expenses have increased during the first quarter of 2001
because approximately $420,000 of non-cash, stock option compensation expense
was recorded for performance stock options that vested during the first quarter
of 2000. During the first quarter of 2000, a number of corporate milestones were
accomplished. Increases in general and administrative expenses during the first
quarter of 2001 are the result of increased staffing and expenses necessary to
manage and support our expanding product and business development efforts. We
expect general and administrative expenses to continue to increase as a result
of increasing legal and other professional fees in connection with the overall
scale-up of our operations, business development efforts and patent protection.

     Interest income increased to $877,000 for the three months ended March 31,
2001 compared to $248,000 for the corresponding period in 2000. The increase is
due to higher average balances in our cash and cash equivalents and securities
available-for-sale during the first quarter of 2001, as compared to the same
quarter in 2000. Cash balances were higher as a result of public offerings
completed in both July 1999 and April 2000 that resulted in $58.0 million net
proceeds. Interest income generally fluctuates as a result of the average amount
of cash available for investment and prevailing interest rates.

     Interest expense decreased slightly to $107,000 for the three months ended
March 31, 2001, compared to $138,000 for the corresponding period in 2000. The
decrease is due to our repayment of $6.9 million on a debt facility from
Schering AG with proceeds from our 2000 public offering. The remaining balance
of $997,000 was converted into 42,435 shares of our common stock in June 2000.

                                      10
<PAGE>

Subsequently, we borrowed an additional $1.0 million from Schering AG in each of
October 2000 and January 2001 and $2.7 million from Elan related to our joint
venture. Therefore, interest expense is expected to increase in the future as we
borrow additional funds from our partners and arrange for additional financing
for operations.

     Equity in loss of unconsolidated affiliates was $2.6 million for the period
ending March 31, 2001, compared to $1.8 million for the corresponding period in
2000. The expense in both 2000 and 2001 is our 80.1% share of Medizyme's
recorded loss. While we own 80.1% of the outstanding common stock of Medizyme,
Elan has retained significant minority investor rights that are considered
"participating rights" as defined in EITF 96-16 Investors Accounting for an
Investee When the Investor Owns a Majority of the Voting Stock but the Minority
Shareholder or Shareholders Have Certain Approval or Veto Rights. Therefore, we
do not consolidate the operations of Medizyme, but instead account for our
investment in Medizyme under the equity method. Medizyme's expenses include
$1.25 million amortized expense in each quarter for payment of a $15.0 million
license fee paid to Elan in January 2000, as well as $1.9 million and $972,000
we invoiced Medizyme for the periods ending March 31, 2001 and 2000,
respectively, for research we conducted on HERZYME.

Liquidity and Capital Resources

     We have financed our operations since inception through sales of equity
securities in public offerings, private placements of preferred and common
stock, funds received under our collaborative agreements and financing under
equipment and tenant improvement loans. From inception through March 31, 2001,
we have received approximately:

     .    $29.0 million in net proceeds from private placements;

     .    $89.2 million in net proceeds from public offerings;

     .    $97.3 million from our collaborations; and

     .    $9.8 million from equipment financing.

     We had cash, cash equivalents and securities available-for-sale of $54.1
million at March 31, 2001 compared with $64.5 million at December 31, 2000. The
$10.4 million decrease in cash, cash equivalents and securities available-for-
sale is primarily the result of $10.1 million used for operations, net of
revenues of $2.1 million; $857,000 used for investments in equipment, leasehold
improvements and patents; $400,000 loan to an executive, offset by $1.0 million
received in proceeds from our debt facility.

     We invest our cash, cash equivalents and securities available-for-sale in
interest-bearing, investment-grade securities.

     Accounts receivable at March 31, 2001 were $7.8 million compared to $3.6
million at December 31, 2000. Accounts receivable at March 31, 2001 included
$587,000 due from Atugen for administrative services and patent expenses, $3.9
million due from Medizyme for research support for HERZYME and $3.0 million due
from Chiron for reimbursement of ANGIOZYME fourth quarter expenses.

     Total additions for property, plant and equipment for the three months
ending March 31, 2001 were $766,000, most of which were financed through our
existing equipment loan facility with Schering AG. We anticipate future
equipment needs to be financed by the Schering AG loan facility during 2001, as
well as additional credit facilities yet to be determined.

                                      11
<PAGE>

     In July 1994, we entered into an agreement with Chiron to collaborate
exclusively on up to five specific targets selected by Chiron. ANGIOZYME is
being developed in collaboration with Chiron and we share equally all
development costs and future profits with Chiron. Chiron has indicated its
desire not to participate in the Phase II clinical trials for renal cell cancer
and melanoma. In March 2001, we issued 38,920 shares of our common stock to
Chiron in exchange to reacquire all rights to develop any product containing or
utilizing an HIV target. An expense of $275,000 was recorded during the period
ending March 31, 2001 in connection with the issuance of the stock. During the
first quarter of 2001, we recorded $2.3 million in revenues and reimbursement of
expenses from Chiron for costs incurred for the clinical development of
ANGIOZYME.

     In connection with our collaboration with Chiron, an operational audit was
performed by Chiron's internal audit department for years ending December 31,
2000 and 1999. As a result of this audit, the rate we charge per researcher
working on the ANGIOZYME collaboration has been brought into question. We have
been discussing this matter with Chiron and expect a resolution in the near
term. However, currently it is uncertain as to what the rate will be and as to
what adjustments will be necessary. We do not expect any material changes to the
rate charged per researcher.

     In April 1997 we entered into a purchase agreement with Schering AG and
Schering Berlin Venture Corporation ("SBVC"), an affiliate of Schering AG,
subsequently amended, as part of our target discovery and validation program.
SBVC made a $2.5 million equity investment in us in April 1997 in exchange for
212,766 shares of our common stock and made an additional equity investment of
$2.5 million for 465,117 shares of our common stock in April 1998. Separately,
Schering AG provided loans of $2.0 million in each of 1997, 1998, 1999, 2000 and
2001. We received our last draw down of $1.0 million from Schering AG in April
2001. The loans, which carry an interest rate of 8.0% per annum, are immediately
convertible into equity at the option of Schering AG. In April 2000, after the
completion of our public offering, we repaid $6.9 million of our outstanding
borrowings to Schering AG. In June 2000, Schering AG converted $997,000 of the
balance into 42,435 shares of our common stock at a conversion price of $23.50.
According to the terms of our agreement with Schering AG, 50.0% of any
borrowings on the line of credit must be collateralized by equipment purchases.
At March 31, 2001, we had $2.0 million in outstanding loans from Schering AG,
which was convertible into approximately 330,000 shares of our common stock.
Principal and interest payments are deferred until maturity of the loans in
April 2004. As a result of the Atugen formation in 1998, we now subcontract all
of our existing target discovery and validation programs to Atugen.

     In January 2000, we completed a joint venture with Elan for the development
and commercialization of HERZYME, our potential product to treat breast and
other cancers. In accordance with the collaboration, we sold to Elan our Series
A Convertible Preferred Stock for $12.0 million and, in turn, used those funds
for initial funding of Medizyme. Also as part of the collaboration, Elan
purchased 641,026 shares of our common stock for a purchase price of $5.0
million. Elan has also committed to purchase an additional $5.0 million of
common stock in May 2001 at a share price that is at a premium to the then
market price and would also be based on the achievement of certain milestones.
We have estimated that the development of HERZYME will require additional funds
of up to $15 million and, therefore, Elan has made available to us a credit
facility to fund our portion of Medizyme operating costs over a 30 month period.
At the end of March 2001, we utilized the credit facility and had borrowed $2.7
million. Elan may convert this debt into shares of our Series B Convertible
Preferred Stock in the future.

     In November 2000, we signed an agreement with Acqua Wellington North
American Equities Fund Ltd. to set up an equity financing facility covering the
sale of up to $60 million of our common stock. Any sale of our common stock will
be made pursuant to a shelf registration we filed with the Securities and
Exchange Commission (SEC) covering the sale of up to 3 million shares of our
common stock. The

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<PAGE>

shelf registration was declared effective by the SEC in November 2000. We may
sell the shares at our discretion and as market conditions warrant at a small
discount to market at the time of sale. We will control the quantity and timing
of each incremental sale of stock, if any. Proceeds from any sale of stock will
be used for general corporate purposes. To date, we have not sold any shares of
our common stock under the agreement with Acqua Wellington.

     We anticipate that our existing financial resources and expected revenues
from our collaborations, should be sufficient to meet our anticipated operating
and capital requirements through 2002. We expect to incur substantial additional
costs, including:

     .    costs related to our research, drug discovery and development
          programs;

     .    preclinical studies and clinical trials of our products, if developed;

     .    prosecuting and enforcing patent claims;

     .    general administrative and legal items; and

     .    manufacturing and marketing of our products, if any.

ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

     We are exposed to changes in interest rates primarily from our investments
in certain short-term investments. We invest our excess cash in highly liquid
short-term investments that are typically held for the duration of the term of
the respective instrument. We do not utilize derivative financial instruments,
derivative commodity instruments or other market risk sensitive instruments to
manage exposure to interest rate changes. Accordingly, we believe that, while
the securities we hold are subject to changes in the financial standing of the
issuer of such securities, we are not subject to any material risks arising from
changes in interest rates, foreign currency exchange rates, commodity prices,
equity prices or other market changes that affect market risk sensitive
instruments.


PART II - OTHER INFORMATION

ITEM 2.  CHANGES IN SECURITIES AND USE OF PROCEEDS

     Pursuant to the Amendment to Chiron Corporation - Ribozyme Pharmaceuticals,
Inc. Collaborative Research, Development and Commercialization Agreement dated
March 20, 2001, we issued 38,920 shares of our common stock to Chiron
Corporation in exchange to reacquire all rights to develop any product
containing or utilizing an HIV target. These shares were issued without
registration under the Securities Act of 1933, as amended (the "Securities
Act"), in reliance upon the exemption from the registration requirements of the
Securities Act set forth in Section 4(2) of the Securities Act.

     During the six months ended March 31, 2001, we issued to consultants
warrants to purchase 25,000 shares of our common stock. The warrants are
exercisable at $9.94 per share, are immediately vested, and expire on January 4,
2008. These warrants were issued without registration under the Securities Act
of 1933, as amended (the "Securities Act"), in reliance upon the exemption from
the registration requirements of the Securities Act set forth in Section 4(2) of
the Securities Act.

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<PAGE>

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

     (a)  Exhibits

          3(i)     Amended and Restated Certificate of Incorporation (1)

          3(ii)    Restated Bylaws (2)

          10.1     Warrant to Purchase Shares of Common Stock between the
                   Company and Heidrick & Struggles dated January 4, 2001.

          10.2     Amendment to Chiron Corporation - Ribozyme Pharmaceuticals,
                   Inc. Collaborative Research, Development and
                   Commercialization Agreement dated March 20, 2001.**

     **   Ribozyme Pharmaceuticals has applied for confidential treatment with
respect to portions of this exhibit.

     (b)  Reports on Form 8-K

          A report on Form 8-K was filed on January 5, 2001 announcing the Stock
          Purchase Agreement entered into with Acqua Wellington North American
          Fund, Ltd.

---------
(1)  Incorporated by reference from the Company's Registration Statement on Form
     SB-2, file no. 333-34981, dated September 5, 1997.

(2)  Incorporated by reference from the Company's Registration Statement on Form
     SB-2, file no. 333-1908-D, dated April 11, 1996.

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<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.


                                  RIBOZYME PHARMACEUTICALS, INC.

Dated:    May 15, 2001          By:  /s/ RALPH E. CHRISTOFFERSEN
          ------------              ----------------------------
                                     Ralph E. Christoffersen
                                     Chief Executive Officer

Dated:    May 15, 2001          By:  /s/ LAWRENCE E. BULLOCK
          ------------               -----------------------
                                     Lawrence E. Bullock
                                     Vice President and Chief Financial Officer
                                     (Principal Financial Officer and
                                     Principal Accounting Officer)

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<PAGE>

                                 Exhibit Index

Exhibit                                Exhibit
  No.                                Description
-------                              -----------
3(i)          Amended and Restated Certificate of Incorporation (1)

3(ii)         Restated Bylaws (2)

10.1          Warrant to Purchase Shares of Common Stock between the Company and
              Heidrick & Struggles dated January 4, 2001.

10.2**        Amendment to Chiron Corporation - Ribozyme Pharmaceuticals, Inc.
              Collaborative Research, Development and Commercialization
              Agreement dated March 20, 2001.

**   Ribozyme Pharmaceuticals has applied for confidential treatment with
respect to portions of this exhibit.

-------
(1)  Incorporated by reference from the Company's Registration Statement on Form
     SB-2, file no. 333-34981, dated September 5, 1997.

(2)  Incorporated by reference from the Company's Registration Statement on Form
     SB-2, file no. 333-1908-D, dated April 11, 1996.

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