<PAGE>
 
                                 UNITED STATES
                      SECURITIES AND EXCHANGE COMMISSION

                            Washington, D.C.  20549

                                  FORM 10-QSB

[X] Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange
     Act of 1934

For the quarterly period ended SEPTEMBER 30, 1996

                                      or

[ ] Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange
     Act of 1934

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

Commission File Number 0-9570

                         LUTHER MEDICAL PRODUCTS, INC.
       (Exact name of small business issuer as specified in its charter)

CALIFORNIA                                                33-0468235
(State or other jurisdiction of                           (I.R.S. Employer
incorporation or organization)                            Identification No.)

                  14332 CHAMBERS ROAD, TUSTIN, CA        92680
             (Address of principal executive offices)  (Zip Code)

                                (714) 544-3002
               (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 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.

                                                 [X] Yes   [ ] No

Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.

  COMMON STOCK NO STATED PAR VALUE--3,189,086 SHARES AS OF SEPTEMBER 30, 1996
                                        
                                        
                                        
<PAGE>
 
                                     INDEX

                         LUTHER MEDICAL PRODUCTS, INC.
                                        


<TABLE> 
<CAPTION> 
PART I - FINANCIAL INFORMATION
 
<S>                                                                 <C>
Condensed Consolidated Balance Sheet - September 30, 1996           3

 
Condensed Consolidated Statements of Operations - Three months      
ended September 30, 1996 and 1995                                   4
 
Condensed Consolidated Statements of Cash Flows                              
Three months ended September 30, 1996 and 1995                      5
 
Notes to Condensed Consolidated Financial Statements                6

Management's Discussion and Analysis of Financial                   
Condition and Results of Operations                                 7
 
PART II - OTHER INFORMATION                                         8
 
Signature Page                                                      8
 
</TABLE> 
 
<PAGE>
 
                 LUTHER MEDICAL PRODUCTS, INC. AND SUBSIDIARY
                     CONDENSED CONSOLIDATED BALANCE SHEET


<TABLE>
<CAPTION>
  
ASSETS                                       SEPT. 30,1996
<S>                                          <C> 
CURRENT ASSETS
    Cash and cash equivalents                 $ 1,374,654
    Accounts receivable - net                     707,684
    Inventories - Note C                        1,749,591
    Other current assets                           72,803
                                              -----------
    TOTAL CURRENT ASSETS                        3,904,732
                                              -----------
 
PROPERTY AND EQUIPMENT                          1,216,824
    Less accumulated depreciation                (826,306)
                                              -----------
PROPERTY AND EQUIPMENT - NET                      390,518
                                            
INTANGIBLE ASSETS - NET                           114,975
 
OTHER ASSETS                                       10,199
                                              -----------
                                              $ 4,420,424
                                              ===========
  
 
LIABILITIES & STOCKHOLDERS' EQUITY
 
CURRENT LIABILITIES
 
    Accounts payable                          $   317,113
    Accrued payroll and related expenses           73,839
    Other accrued liabilities                     106,790
                                              -----------
    TOTAL CURRENT LIABILITIES                     497,742
                                              -----------
 
 
 
STOCKHOLDERS' EQUITY
 Preferred stock - no stated par value;
   10,000,000 shares authorized; none issued
   Common stock - no stated par value;
   25,000,000 shares authorized; issued and
   outstanding 3,189,086                       10,236,274
 Accumulated deficit                           (6,313,592)
                                              -----------
 NET STOCKHOLDERS' EQUITY                       3,922,682
                                              -----------
                                              $ 4,420,424
                                              ===========
 
</TABLE>

See notes to condensed consolidated financial statements.


                                      -3-
<PAGE>
 
                 LUTHER MEDICAL PRODUCTS, INC. AND SUBSIDIARY

                CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS

                      FOR THE QUARTER ENDED SEPTEMBER 30,

<TABLE>
<CAPTION>
 
 
                                      THREE MONTHS    THREE MONTHS
                                       ENDED 1996      ENDED 1995
                                      -------------   -------------
<S>                                   <C>             <C>
 
REVENUES                              $   1,132,108   $     671,691
 
COSTS AND EXPENSES:
 
   Cost of sales                            664,424         349,034
 
   Selling                                  325,771         196,910
 
   General and administrative               188,580         173,327
 
   Research and development                 123,665         102,236
 
   Depreciation and amortization             60,106          50,946
 
   Interest expense                             -0-           9,865
                                      -------------   -------------
 
TOTAL COSTS AND EXPENSES                  1,362,546         882,318
 
NET LOSS                              $    (230,438)  $    (210,627)
                                      =============   =============
 

Weighted average number of shares
 outstanding ('000)                           3,179           2,986

Net loss per share:                   $       ( .07)  $        (.07)

</TABLE> 

See notes to condensed consolidated financial statements.



                                      -4-
<PAGE>
 
                 LUTHER MEDICAL PRODUCTS, INC. AND SUBSIDIARY

                CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                    FOR THE THREE MONTHS ENDED SEPTEMBER 30
<TABLE>
<CAPTION>
 
                                                       1996          1995
                                                    -----------   ----------
<S>                                                 <C>           <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)                                   $  (230,438)  $ (210,627)
Adjustments to reconcile net income (loss) to
  net cash used by operating activities :
    Depreciation and amortization                        60,106       50,946
    Changes in operating assets and liabilities:
       Accounts and other receivables                   116,601      (69,970)
       Inventories                                     (162,269)    (137,895)
       Prepaid expenses and other assets                   (584)      26,746
       Accounts payable                                 (13,434)      57,123
       Accrued payroll and related expenses              (6,921)      (6,717)
       Other accrued liabilities                         18,187     (130,771) 
                                                    -----------   ----------
       Net cash (used) provided                        (218,752)    (421,165) 
                                                    -----------   ----------

 
INVESTING ACTIVITIES:
Proceeds from sale of U.S. Treasury bills                   -0-      736,794
Purchases of property and equipment                     (37,007)     (37,424)
                                                    -----------   ----------
Net cash (used) provided in investing activities        (37,007)     699,370
                                                    -----------   ----------

 
FINANCING ACTIVITIES:
Proceeds from sales of common stock                      32,272          -0-
Proceeds from collection of notes receivable from
       stockholder                                                   183,444
                                                    -----------   ----------
Net cash provided by financing activities                32,272      183,444
                                                    -----------   ----------
Net increase (decrease) in cash                        (223,487)     461,649
Cash, beginning of year                               1,598,141      182,726
                                                    -----------   ----------
Cash, at end of three months                        $ 1,374,654   $  644,375
                                                    ===========   ==========
 
</TABLE>


See notes to condensed consolidated financial statements



                                      -5-
<PAGE>
 
                 LUTHER MEDICAL PRODUCTS, INC. AND SUBSIDIARY

             NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

                              SEPTEMBER 30, 1996

NOTE A - BASIS OF PREPARATION

The accompanying condensed consolidated financial statements have been prepared
in accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-QSB and Article 10 of
Regulation S-B.  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 September
30, 1996 are not necessarily indicative of the results that may be expected for
the year ended June 30, 1997.  For further information, refer to the
consolidated financial statements and footnotes thereto included in the
Company's Annual Report on Form 10-KSB.

NOTE B - LOSS PER SHARE

Loss per share is calculated using the weighted average number of shares
outstanding.  Common stock equivalents are not included when their effect would
be antidilutive.

NOTE C - INVENTORIES

The components of inventory consist of the following:
<TABLE>
<CAPTION>
 
                          Sept. 30,1996
                          -------------
     <S>                  <C>
     Raw material         $     679,573
     Work in process            553,146
     Finished goods             516,872
                          -------------
                          $   1,749,591
                          =============
 
</TABLE>



                                      -6-
                                        
<PAGE>
 
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS

RESULTS OF OPERATIONS

Total consolidated revenues for the first quarter of fiscal year 1997 were
$1,132,000 compared to $672,000 for the prior year's quarter, an increase of
68%.  Catheter product sales increased by 77% to $1,108,000 from $627,000 for
the prior year's quarter.  Sales to distributors contributed $768,000, a 102%
increase from revenues of $381,000 for the same period last year.  Catheter
sales to international distributors increased to $187,000 or 73% and sales to
OEM customers increased to $144,000 from $120,000 in the prior year's period.
Interest income decreased by $23,000 over the prior year's quarter.

Cost of revenues for the three months ended September 30, 1996 were $664,000
compared to $349,000 in the prior year's quarter.  Cost of revenues as a
percentage of product sales increased to 60% from 56% in the prior year's
quarter, mainly as a result of a change in product mix.

Selling expenses were $326,000 for the quarter ended September 30, 1996, a 65%
increase from $197,000 in the prior year's quarter.  The increase is
attributable to increased marketing efforts to support the Company's distributor
network with the goal to increase the Company's market share.  General and
administrative expenses increased by $15,000 for the quarter, mainly as a result
of higher legal fees.

Research and development expenses were $124,000 for the first quarter of fiscal
year 1997 compared to $102,000 for the same period last year.  Depreciation and
amortization expense increased from $51,000 to $60,000.  Interest expense was
zero compared to $10,000 in the prior year's quarter.

LIQUIDITY AND CAPITAL RESOURCES

At September 30, 1996, the Company had working capital of $3.4 million and its
principal sources of liquidity consisted of $1.4 million in cash and cash
equivalents.  Net cash used by operating activities for the three months ended
September 30, 1996, was $219,000, mainly as the result of the net loss of
$230,000, the decrease in accounts and other receivables of $117,000 and the
increase in inventories of $162,000.  With respect to investing activities, the
Company made purchases of property and equipment totaling $37,000, during the
quarter ended September 30, 1996.  Financing activities provided $32,000,
resulting from sales of common stock for the exercise of stock options and
warrants.

The Company has no long-term commitments other than an annual lease obligation
of between $130,000 and $151,000 for its facilities through 1998 and consulting
fees of $396,000 payable to National Contracts Inc. over a two-year period,
$289,000 which was paid through September 30, 1996.

                                      -7-
<PAGE>
 
                          PART II - OTHER INFORMATION

ITEM 6.     EXHIBITS AND REPORTS ON FORM 8-K

(a) Exhibits

Exhibit 27  Financial Data Schedule


(b) Reports on Form 8-K

There were no reports on Form 8-K filed for the three months ended September 30,
1996.



                                   SIGNATURES

In accordance with the requirements of the Securities Exchange Act, the
Registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.



LUTHER MEDICAL PRODUCTS, INC.

By: /s/ DAVID ROLLO                             Date: November 14, 1996
    ---------------                             -----------------------
David Rollo
Chief Financial Officer



                                      -8-