<PAGE>
 
                                                                       CONFORMED
                                                                                
                      SECURITIES AND EXCHANGE COMMISSION
                            Washington, D.C. 20549
                                  FORM 10-QSB

(Mark One)
    X     QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
 -------  ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED MARCH 31, 1998 OR
                                                                      
         
          TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
 -------  ACT OF 1934 FOR THE TRANSITION PERIOD FROM ________ TO _______
          

          Commission file number 33-23786-LA


                                  AMDL, INC.
                                  ----------
       (Exact name of small business issuer as specified in its charter)


              Delaware                                      87-0188822
           --------------                                   ----------
         (State or other jurisdiction                    (I.R.S. Employer
         of incorporation or organization)               Identification No.)


             14272 Franklin Ave., Suite 106
             Tustin, California                            92780-7039
          ---------------------------------                ---------- 
          (Address of principal executive offices)         (Zip Code)


               (714) 505-4460    
 ------------------------------------------
(Issuer's telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last
report)

Check whether the issuer (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 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
    --    --  

Applicable only to corporate issuers:

As of June 30, 1998, the Registrant had outstanding 33,754,903 shares of its
common stock, par value $.001.
<PAGE>
 
                                   AMDL, INC.
                         (A Development Stage Company)

                               TABLE OF CONTENTS
 
 
                                                                      Page No.
                                                                      --------
 
PART I        FINANCIAL INFORMATION....................................   3
 
ITEM 1.       FINANCIAL STATEMENTS.....................................   3
 
ITEM 2.       MANAGEMENT'S DISCUSSION AND ANALYSIS OF
              RESULTS OF OPERATIONS AND FINANCIAL POSITION.............   3
 
              Preliminary Note Regarding Forward Looking Financial
              Statements...............................................   3 
 
              Balance Sheets as of March 31, 1998 and December 31, 1997   6
 
              Statements of Operations for the three months ended
              March 31, 1998 and 1997 and for the period from inception
              (July 10, 1987) to March 31, 1998........................   7
 
              Statements of Cash Flows for the three months
              ended March 31, 1998 and 1997 and for the period
              from inception (July 10, 1987) to March 31, 1998.........   8
 
              Notes to the Financial Statements........................   9
 
PART II       OTHER INFORMATION........................................  10

                                      -2-
<PAGE>
 
                         PART I - FINANCIAL INFORMATION
                                        
ITEM 1.  FINANCIAL STATEMENTS

The financial statements included herein have been prepared by AMDL, Inc. (the
Company), without audit, pursuant to the rules and regulations of the Securities
and Exchange Commission.  Certain information normally included in the financial
statements prepared in accordance with generally accepted accounting principles
has been omitted pursuant to such rules and regulations.  However, the Company
believes that the disclosures are adequate to make the information presented not
misleading.  These financial statements should be read in conjunction with the
financial statements and notes thereto included in the Company's annual report
on Form 10-KSB for the fiscal year ended December 31, 1997, as filed with the
Securities and Exchange Commission.

The financial statements are included after Item 2.

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

In February 1998, the Board adopted a resolution authorizing the Company to make
a $7,500 investment in a newly formed entity, Sino-American Medical, Inc.
("SAM"), a Delaware corporation.  The resolution also authorized certain AMDL
personnel and a  related party to accept executive positions with SAM and
utilize a small portion of their employment schedule at AMDL for SAM related
activities in exchange for the favorably priced investment terms.  SAM
reimburses the Company for incidental expenses such as telephone and postage.
Douglas C. MacLellan, a Director of the Company accepted the position of
Chairman of the Board and Secretary of SAM.  The other Company personnel include
That. T. Ngo, Ph.D., the Company's President and Chief Executive Officer and
Director, Harry Berk, Vice President, Chief Financial Officer, Secretary and
Treasurer and Thomas V. Tilton, Director of Corporate Development.   Dr. Ngo
accepted the position of Director, President and CEO of SAM.  Harry Berk
accepted the position of Treasurer and Thomas V. Tilton accepted the position of
Vice President of SAM.  SAM was created to participate in a joint venture in
China leading to the privatization of a Chinese pharmaceutical firm.  It was the
AMDL Board's position that AMDL did not have the financial resources to pursue
the SAM opportunity and that the nominal  investment in SAM and permission to
permit certain AMDL personnel to engage in limited SAM activities was in the
best interests of AMDL and that the terms of the SAM transaction were fair and
reasonable.  AMDL made the $7,500 investment in SAM in April 1998.

Preliminary Note Regarding Forward Looking Statements

This Quarterly Report on Form 10-QSB contains forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934.  The Company's actual results may differ
materially from the results projected in the forward-looking statements.
Factors that might cause such a difference include, but are not limited to,
those discussed below.

General

Since inception, the Company has been in the development stage and has devoted
its resources to research and development, obtaining regulatory approval and the
commercialization of its proposed diagnostics for cancer and other diseases.
For the three month period ended March 31, 1998, the Company received $42,603
from sales of products.  Historically, the Company's income has come from the
sale of licenses, royalties and options to purchase marketing rights.  The
Company has incurred losses since inception and expects to incur a significant
operating loss for the fiscal year ending December 31, 1998.  The Company will

                                      -3-
<PAGE>
 
require substantial additional funding for continuing research and development,
obtaining regulatory approval and for commercialization of its products.  There
can be no assurances that the Company will be able to obtain such funding when
needed or at all, or if available, what the terms thereof will be.

Liquidity and Capital Resources

The Company has generated only minimal revenues from sales of products and
historically its income has come from the sale of licenses, royalties and
options to purchase marketing rights.  Operations have been funded principally
through private placements of its equity securities, and income received from
the sale of licenses, royalties and options to acquire marketing rights.  The
Company requires significant funding for the continued development of its test
kit systems, clinical trials and other actions necessary to obtain regulatory
approvals and to engage in continued marketing and sales activities.  The amount
of expenditures required to maintain operations and to continue product
development far exceeds existing cash.  The availability of sources of cash for
such expenditures is presently unknown.  From December 31, 1997 to March 31,
1998, the Company's cash, cash equivalents and short-term investments decreased
to $980,523 as a result of working capital requirements.  The Company is also
hopeful of obtaining additional revenues from product sales, but there is no
commitment by any person for purchase of any of the Company's products.  In the
absence of significant sales and profits, the Company may seek to raise
additional funds to meet its working capital needs principally through the
additional sales of its securities.  However, there is no assurance that the
Company will be able to obtain sufficient additional funds when needed, or that
such funds, if available, will be obtainable on terms satisfactory to the
Company.  The Company can make no prediction as to when, if ever, it will be
profitable.

The Company believes that its present cash and cash equivalents balances to be
sufficient only for operations through the third quarter of 1998, assuming the
Company is able to extend forbearance of collection efforts on its outstanding
indebtedness.  However, certain scheduled activities will be curtailed after the
second quarter unless additional operating capital is obtained.  The Company is
continuing its efforts to raise capital to finance continuing operations,
provide assistance to ICD in connection with international market development
for DR-70, accelerate international and domestic market development for the
Company's other products, develop and commercialize new products and obtain the
required regulatory approvals.  There can be no assurance as to the success of
these efforts, or, if successful, what the cost or terms thereof will be.

Currently, the Company does not anticipate any significant changes in the number
of employees.  The Company may not be able to retain its present employees if
additional financing is not obtained.  If such financing is obtained, the
Company may also seek to add employees to further its efforts to commercialize
its products.

At March 31, 1998, the Company was indebted for $577,527 for accrued salaries
payable to five persons who are officers and other employees and former
employees, four of whom agreed to payments equal to their proportionate share of
five percent of sales revenues, if any, of the Company, but not less than $500
per month per person.

Results of Operations

Reference is made to the Company's annual report on Form 10-KSB for the fiscal
year ended December 31, 1997 for a detailed discussion and analysis of the
Company's financial condition and results of operations for the periods covered
by that report.  The net loss for the first quarter ended March 31, 1998

                                      -4-
<PAGE>
 
was approximately $586,000 and the Company anticipates a net loss for the
quarter ending June 30, 1998 of approximately $500,000.

Revenues
--------

During the quarter ended March 31, 1998, the Company received $42,603 in revenue
from the sales of cancer diagnostic kits and OEM products as compared to no
sales for first quarter 1997.  No significant sales are expected for the second
quarter of 1998.

Research and Development and General and Administrative Expenses
----------------------------------------------------------------

Research and development expenses for the quarter ended March 31, 1998, were
37.9 percent higher than the prior year's first quarter.  Expense categories
reflecting increases include the research and development expenses associated
with the additional clinical trial data required for the PyloriProbe application
resubmission to the U. S. Food and Drug Administration.  Other research and
development expense categories reflecting increases include the research and
development portion of payroll and consulting expenses.  Research and
development expense categories reflecting decreases include laboratory expenses
and the research and development portion of rent, reflecting the Company's
attempt to reduce these costs.

General and administrative expenses for the quarter ended March 31, 1998 were
2.1 percent higher than the prior year's first quarter.  Expense categories
reflecting increases over the equivalent period in the prior year include the
general and administrative portion of payroll.  Expense categories reflecting
decreases  include legal and other professional expenses, reflecting the
Company's attempt to reduce costs of outside service providers.

During the three month period ended March 31, 1998, the Company realized
interest income of $15,939 compared to $36,086 of interest income for the
equivalent period in the prior year due to available funds for investments.
Interest income will significantly decline as short term investments are used in
operations.

                                      -5-
<PAGE>
 
                                   AMDL, INC.
                         (A Development Stage Company)
                                 Balance Sheets

                                     ASSETS
                                     ------
<TABLE>
<CAPTION>
                                          March 31,     Dec. 31,
                                             1998         1997
                                         (Unaudited)
                                        ------------  ------------    
<S>                                     <C>           <C>
CURRENT ASSETS
     Cash and cash equivalents          $    980,523  $  1,498,540
     Accounts receivable                      19,436             -
                                        ------------  ------------
 
        Total current assets                 999,959     1,498,540
 
OTHER ASSETS                                   7,863         7,863
                                        ------------  ------------
 
                                        $  1,007,822  $  1,506,403
                                        ============  ============
<CAPTION> 
                     LIABILITIES AND STOCKHOLDERS' EQUITY
                     -------------------------------------
 
CURRENT LIABILITIES
  Notes payable                         $     25,000  $     25,000
  Accounts payable and accrued expenses      208,434       125,748
  Accrued payroll and related expenses       688,867       674,669
  Customer deposit                            22,735        32,235
                                        ------------  ------------
                                        
        Total current liabilities            945,036       857,652
                                        ------------  ------------
                                       
COMMITMENTS
 
STOCKHOLDERS' EQUITY
  Preferred stock, 10,000,000 shares
    authorized, no shares issued or
    outstanding at March 31, 1998
    and December 31, 1997                          -             -
  Common stock, $0.001 par value,
    50,000,000 shares authorized,
    33,754,903 shares issued and
    outstanding at March 31, 1998
    and December 31, 1997                     33,755        33,755
  Additional paid-in capital              11,909,699    11,909,699
  Deficit accumulated during
    the development stage                (11,880,668)  (11,294,703)
                                        ------------  ------------
                                        
                                              62,786       648,751
                                        ------------  ------------
                                        $  1,007,822  $  1,506,403
                                        ============  ============
</TABLE>

   The accompanying notes are an integral part of these financial statements

                                   

                                      -6-
<PAGE>
 
                                   AMDL, INC.
                         (A Development Stage Company)
                            Statements of Operations
                                  (Unaudited)
<TABLE>
<CAPTION>
                                                                                   From
                                                                               Inception on
                                                                               July 10, 1987
                                            For the Three Months Ended            through
                                                     March 31,                   March 31,
                                            ----------        ----------       -------------
<S>                                         <C>               <C>              <C>
NET SALES                                   $   42,603        $      -          $     85,039
 
COSTS OF SALES                                  34,158               -                57,197
                                            ----------        ----------        ------------
  Gross Profit                                   8,445               -                27,842
                                            ----------        ----------        ------------
 
OPERATING EXPENSES:
  Research and development                     307,567           223,074           6,201,205
  General and administrative                   302,782           296,552           7,023,481
                                            ----------        ----------        ------------
                                               610,349           519,626          13,224,686
                                            ----------        ----------        ------------ 
LOSS FROM OPERATIONS                          (601,904)         (519,626)        (13,196,844)
                                            ----------        ----------        ------------

OTHER INCOME (EXPENSE):
  Interest expense                                 -                 -              (561,016)
  Interest income                               15,939            36,086             225,655
  Other                                            -                 -             1,651,536
                                            ----------        ----------        ------------
                                                15,939            36,086           1,316,175
                                            ----------        ----------        ------------
NET LOSS                                    $ (585,965)       $ (483,540)       $(11,880,669)
                                            ==========        ==========        ============
 
BASIC AND DILUTED NET LOSS PER SHARE        $    (0.02)       $    (0.01)
                                            ==========        ==========      
 
WEIGHTED AVERAGE SHARES OUTSTANDING         33,754,903        33,531,027
                                            ==========        ==========
</TABLE>
                                        
   The accompanying notes are an integral part of these financial statements

                                      -7-
<PAGE>
 
                                   AMDL, INC.
                         (A Development Stage Company)
                            Statements of Cash Flows
                                  (Unaudited)
                                        
<TABLE>
<CAPTION>
 
 
                                                                                                                       Inception
                                                                                    Three             Three          (July 10, 1987)
                                                                                Months Ended      Months Ended             to
                                                                                  March 31,         March 31,            March 31,
                                                                                    1998              1997                1998
                                                                                ------------      ------------       --------------
<S>                                                                             <C>               <C>                <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
  Net loss                                                                        $ (585,965)     $   (483,540)      $ (11,880,668)
 
  Adjustments to reconcile net loss to net cash used in operating activities-     
    Depreciation and amortization                                                       -                  -               497,288
    Amortization of deferred interest                                                   -                  -               312,000
    Common stock subscribed                                                             -                  -               300,000
    Stock issued for services                                                           -                  -               312,541
    Warrants issued for services                                                        -                  -               661,529
    Increase in accounts receivable                                                  (19,436)              -               (19,436)
    Increase in other assets                                                            -                  -                (7,863)
    Decrease in inventory                                                               -              (17,339)               -
    Increase (decrease) in accounts payable and accrued expenses                      82,686           (74,612)            233,889
    Increase (decrease) in accrued payroll and related expenses                       14,198          (214,053)            688,867
    Increase (decrease) in customer deposit                                           (9,500)              -                22,735
                                                                                  ----------      ------------       -------------
          Net cash used in operating activities                                     (518,017)         (789,544)         (8,879,118)
                                                                                  ----------      ------------       -------------
 
CASH FLOWS FROM INVESTING ACTIVITIES:
 
  Purchases of equipment                                                                -                  -              (225,930)
  Expenditures for patents                                                              -                  -              (154,682)
                                                                                  ----------      ------------       -------------
          Net cash used in investing activities                                         -                  -              (380,612)
                                                                                  ----------      ------------       -------------
CASH FLOWS FROM FINANCING ACTIVITIES:
 
  Borrowings under notes payable, net                                                   -                  -                59,115
  Repayments under capital lease obligation                                             -               (8,865)           (116,676)
  Proceeds from issuance of common stock                                                -               25,000          10,240,747
  Net effect of merger with CVI                                                         -                  -                57,067
                                                                                  ----------      ------------       -------------
          Net cash provided by financing activities                                     -               16,135          10,240,253
                                                                                  ----------      ------------       -------------
 
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS                                (518,017)         (773,409)            980,523
 
CASH AND CASH EQUIVALENTS, beginning of period                                     1,498,540         3,504,660                -
                                                                                  ----------      ------------       -------------
CASH AND CASH EQUIVALENTS, end of period                                          $  980,523      $  2,731,251       $     980,523
                                                                                  ==========      ============       ============= 
</TABLE>

   The accompanying notes are an integral part of these financial statements

                                      -8-
<PAGE>
 
                                   AMDL, INC.
                         (A Development Stage Company)
                       Notes to the Financial Statements
                                 March 31, 1998
                                  (Unaudited)

NOTE 1 -  MANAGEMENT OPINION

          The financial statements included herein have been prepared by AMDL,
          Inc. (the Company), without audit, pursuant to the rules and
          regulations of the Securities and Exchange Commission. Certain
          information normally included in the financial statements prepared in
          accordance with generally accepted accounting principles has been
          omitted pursuant to such rules and regulations. However, the Company
          believes that the disclosures are adequate to make the information
          presented not misleading. It is suggested that the financial
          statements be read in conjunction with the financial statements and
          notes thereto included in the Company's annual report on Form 10-KSB
          for the fiscal year ended December 31, 1997, as filed with the
          Securities and Exchange Commission.

NOTE 2 -  STOCK BASED COMPENSATION PLANS

          The following is a status of the stock options outstanding at March
31, 1998:

                                                        Shares  Weighted Average
                                                        (000)    Exercise Price
                                                        ------  ----------------
            Outstanding, December 31, 1997               4,650      $ 0.824
              Granted                                      300        0.138
              Exercised                                     -            -
              Expired/Forfeited                            (57)      (0.802)
                                                         -----      -------
            Outstanding, March 31, 1998                  4,893      $ 0.782
                                                         =====      =======
            Exercisable at March 31, 1998                4,404      $ 0.820
                                                         =====      =======
 
          The following is a status of the warrants outstanding at March 31,
 1998:
 
                                                        Shares  Weighted Average
                                                        (000)    Exercise Price
                                                        ------  ----------------
            Outstanding, December 31, 1997               1,889      $ 0.836
              Granted                                       -            -
              Exercised                                     -            -
              Expired/Forfeited                             -            -
                                                        ------      -------
            Outstanding, March 31, 1998                  1,889      $ 0.836
                                                        ======      =======

            All of the warrants are exercisable at March 31, 1998.

                                      -9-
<PAGE>
 
NOTE 3 -  REVENUE RECOGNITION

          Revenue is recognized upon shipment of products to customers.
 
NOTE 4 -  BASIC AND DILUTED NET LOSS PER SHARE

          Basic and diluted net loss per share is calculated using the weighted
          average number of shares outstanding for the period. Common equivalent
          shares are excluded from the computation as their effect is
          antidilutive.

NOTE 5 -  INVESTMENT IN NEWLY FORMED ENTITY

          The Board of Directors authorized the Company to make a $7,500
          investment in a newly formed entity.  This investment was made in 
          April 1998.

NOTE 6 -  RECLASSIFICATIONS

          Certain reclassifications have been made to the financial statements
          at March 31, 1997 in order to conform to classifications used in the
          current quarter.

                          PART II - OTHER INFORMATION
                                        
Item 1  Legal Proceedings.
        ------------------
        Inapplicable.

Item 2  Changes in Securities and Use of Proceeds.
        ------------------------------------------
        Inapplicable.

Item 3  Defaults Upon Senior Securities.
        --------------------------------
        Inapplicable.

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

Item 5  Other Information.
        ------------------
        Inapplicable

Item 6  Exhibits and Reports on Form 8-K.
        ---------------------------------
        (a)  Exhibits.
             ---------
             Inapplicable.

        (b)  Reports of Form 8-K.
             --------------------
             Inapplicable.

                                      -10-
<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.


                                                  AMDL, INC.

June 30, 1998                                By:  /s/ Harry Berk
                                                  ------------------------
                                                  Chief Accounting Officer


June 30, 1998                                By:  /s/ That T. Ngo
                                                  ------------------------   
                                                  President

                                      -11-