SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549

                                    FORM 10-Q

         Mark One:

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

                    For the quarter ended September 30, 2002

                                       OR

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


                         Commission File Number 0-27324


                       SYNAPTIC PHARMACEUTICAL CORPORATION
             (Exact name of registrant as specified in its charter)


                    Delaware                           22-2859704
          (State or other jurisdiction    (I.R.S. Employer Identification No.)
       of incorporation or organization)

                215 College Road                         07652
                  Paramus, NJ                         (Zip Code)
    (Address of principal executive offices)

                                 (201) 261-1331
              (Registrant's telephone number, including area code)


     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,  as amended,  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

     As of November 1, 2002,  there were 10,977,790  shares of the  registrant's
Common Stock outstanding.


<PAGE>



                       SYNAPTIC PHARMACEUTICAL CORPORATION

          INDEX TO QUARTERLY REPORT ON FORM 10-Q FOR THE QUARTER ENDED
                               SEPTEMBER 30, 2002


                          PART I. FINANCIAL INFORMATION

                                                                          Page
                                                                          ----
Item  1. Financial Statements (unaudited):

             Balance Sheets at September 30, 2002 and December 31, 2001...  1

             Statements of Operations and Comprehensive Income (Loss) for
               the three months ended September 30, 2002 and 2001 and for
               the nine months ended September 30, 2002 and 2001..........  2

             Statements of Cash Flows for the nine months ended
              September 30, 2002 and 2001.................................  3

             Notes to Financial Statements................................  4

Item  2. Management's Discussion and Analysis of Financial Condition
          and Results of Operations.......................................  6

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

Item 4.  Controls and Procedures.......................................... 14


                       PART II. OTHER INFORMATION

Item 1.  Legal Proceedings................................................ 15

Item 6.  Exhibits and Reports on Form 8-K................................. 16



         Signatures....................................................... 17

         Certifications Pursuant to Section 302 of Sarbanes-Oxley
          Act of 2002..................................................... 18

                                      (i)
<PAGE>



                          PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
                       SYNAPTIC PHARMACEUTICAL CORPORATION
                                 BALANCE SHEETS
                    (in thousands, except share information)


                                                    September 30,   December 31,
Assets                                                    2002         2001
-------------------------------------------------------------------------------
                                                       (Unaudited)  (Audited)
Current assets:

Cash and cash equivalents                               $ 26,234      $ 45,552
Marketable securities--current maturities                  1,529         2,553
Deferred tax assets                                            -           256
Other current assets                                         803           431
-------------------------------------------------------------------------------
Total current assets                                      28,566        48,792

Property and equipment, net                                4,610         4,268
Marketable securities                                          -         1,545
Other assets                                                 214           228
-------------------------------------------------------------------------------
                                                        $ 33,390      $ 54,833
===============================================================================

Liabilities, Redeemable Convertible Preferred Stock
 and Stockholders' (Deficit) Equity
-------------------------------------------------------------------------------
Current liabilities:

Accounts payable                                         $ 1,380       $ 1,441
Accrued liabilities                                        1,462         1,104
Accrued compensation                                         403           550
Deferred revenue                                             734           107
-------------------------------------------------------------------------------
Total current liabilities                                  3,979         3,202

Deferred rent obligation                                   1,056           845

Series B senior redeemable convertible preferred
 stock; authorized, issued and outstanding--11,056 shares
 liquidation preference--$11,056                          10,529        10,206
Series C senior redeemable convertible preferred
 stock; authorized, issued and outstanding--29,944 shares
 liquidation preference--$29,944                          27,761        27,613

Stockholders' (deficit) equity:

Series A preferred stock, $.01 par value;
 authorized--1,000,000 shares                                  -             -
Common Stock, $.01 par value; authorized--25,000,000
 shares issued and outstanding--10,977,790 shares in
 2002 and 10,953,353 shares in 2001                          109           109
Additional paid-in capital                                99,428        99,376
Accumulated other comprehensive income--net unrealized        28            87
      gains on securities
Accumulated deficit                                     (109,230)      (86,605)
-------------------------------------------------------------------------------
Total stockholders' (deficit) equity                      (9,665)       12,967
-------------------------------------------------------------------------------
                                                        $ 33,390      $ 54,833
===============================================================================


                       See notes to financial statements.

                                       1

<PAGE>

                       SYNAPTIC PHARMACEUTICAL CORPORATION
            STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

             (in thousands, except share and per share information)
                                   (Unaudited)


                                For the three months      For the nine months
                                 ended September 30,       ended September 30,
                                 2002         2001         2002         2001
--------------------------------------------------------------------------------
Revenues:
 Contract revenue              $   293      $   290      $   879      $   867
 License revenue                    83           84        1,854          250
--------------------------------------------------------------------------------
  Total revenues                   376          374        2,733        1,117

Expenses:
 Research and development        6,339        4,677       19,574       12,777
 General and administrative      2,446        1,605        6,822        5,152
--------------------------------------------------------------------------------
  Total expenses                 8,785        6,282       26,396       17,929
--------------------------------------------------------------------------------
Loss from operations            (8,409)      (5,908)     (23,663)     (16,812)

Other income, net:
 Interest income                   161          315          618        1,093
 Other                             121          118          362          372
--------------------------------------------------------------------------------
  Other income, net                282          433          980        1,465
--------------------------------------------------------------------------------
Net loss before benefit
  from income taxes             (8,127)      (5,475)     (22,683)     (15,347)
Income tax benefit                   -            -           58            -
--------------------------------------------------------------------------------
Net loss                        (8,127)      (5,475)     (22,625)     (15,347)
Accretion to redemption
 value of mandatorily redeemable
 convertible preferred stock       (68)      (4,316)        (201)      (4,316)
--------------------------------------------------------------------------------
Net loss applicable to
 common stockholders           $(8,195)     $(9,791)    $(22,826)    $(19,663)
================================================================================

Comprehensive loss:

Net loss                       $(8,127)     $(5,475)    $(22,625)    $(15,347)

Unrealized (losses) gains
 arising during period             (13)          75          (60)         334
--------------------------------------------------------------------------------
Comprehensive loss             $(8,140)     $(5,400)    $(22,685)    $(15,013)
================================================================================

Basic and diluted net loss
 per share                      $(0.75)      $(0.89)      $(2.08)     $(1.80)
================================================================================

Shares used in computation
 of net loss per share      10,977,614   10,942,755    10,973,345   10,939,822
================================================================================


                       See notes to financial statements.

                                       2
<PAGE>


                       SYNAPTIC PHARMACEUTICAL CORPORATION
                            STATEMENTS OF CASH FLOWS

                                 (in thousands)
                                   (Unaudited)

For the nine months ended September 30, 2002 and 2001

                                                          2002            2001
--------------------------------------------------------------------------------
Operating activities:
Net loss                                              $ (22,625)      $ (15,347)
Adjustments to reconcile net loss to net cash
 (used in) operating activities:
 Depreciation                                                856          1,037
 Amortization of premiums on securities                       10            262
 Deferred rent, net                                          225            125
 Non-cash stock compensation                                 139              -
Changes in operating assets and liabilties:
 Increase in other current assets                           (116)           100
 Increase in accounts payable,
  accrued liabilities and accrued compensation               150          3,324
 Increase in deferred revenue                                624             44
--------------------------------------------------------------------------------
Net cash (used in) operating activities                  (20,734)       (10,455)

Investing activities:
 Proceeds from sale or maturity of investments             2,500         22,240
 Purchases of property and equipment                      (1,198)          (540)
 Purchase of investments                                       -         (2,000)
 Proceeds from sale of equipment                               -             16
--------------------------------------------------------------------------------
Net cash provided by investing activities                  1,302         19,916

Financing activities:
 Issuance of common stock                                    114             38
 Issuance of common stock                                     --         37,745
--------------------------------------------------------------------------------
Net cash provided by financing activities                    114         37,783
--------------------------------------------------------------------------------
Net (decrease) increase in cash and cash equivalents    (19,318)         47,244
Cash and cash equivalents at beginning of period         45,552           2,037
--------------------------------------------------------------------------------
Cash and cash equivalents at end of period             $ 26,234        $ 49,281
================================================================================


                       See notes to financial statements.

                                       3
<PAGE>


                       SYNAPTIC PHARMACEUTICAL CORPORATION
                          NOTES TO FINANCIAL STATEMENTS

                               September 30, 2002


    Note 1 -- Basis of Presentation

     The  accompanying  unaudited  financial  statements  have been  prepared in
accordance  with  the  instructions  to  Form  10-Q  and  may  not  include  all
information  and  footnotes  required  for a  presentation  in  accordance  with
accounting principles generally accepted in the United States. In the opinion of
the management of Synaptic  Pharmaceutical  Corporation (the  "company"),  these
financial statements include all normal and recurring  adjustments necessary for
a fair presentation of the financial  position and the results of operations and
cash flows of the company for the interim periods  presented.  For more complete
financial information,  these financial statements should be read in conjunction
with the audited  financial  statements  for the fiscal year ended  December 31,
2001,  and notes thereto  included in the  company's  2001 Annual Report on Form
10-K. The results of operations for the fiscal quarter ended September 30, 2002,
are not  necessarily  indicative of the results of operations to be expected for
the full year.


Note 2 - Senior Redeemable Convertible Preferred Stock

     On August 3, 2001, the company sold to investors (the "purchasers"),  9,438
shares of Series B Preferred  Stock in a private  placement for  $9,438,000.  On
September  26, 2001,  the company sold 1,618 shares of Series B Preferred  Stock
and 29,944  shares of Series C Preferred  Stock for  $31,562,000.  Net proceeds,
after giving effect to placement fees and offering expenses,  were approximately
$37,745,000.  The purchasers were granted certain  subscription and registration
rights in connection with their acquisition of the Preferred Stock.

     The  Series B and Series C  Convertible  Preferred  Stock  (the  "Preferred
Stock") are two series of senior redeemable  convertible  preferred stock having
identical  terms,  except  that the  Series B  Preferred  Stock  has an  initial
conversion  price of  $4.3358  and the Series C  Preferred  Stock has an initial
conversion  price of $5.9713.  Each share of Preferred Stock may be converted at
any time at the option of the holder  thereof  into a number of shares of common
stock  determined by dividing $1,000 by the conversion  price, as  appropriately
adjusted for any stock splits, stock dividends,  combinations or similar events.
All shares of Preferred Stock shall automatically be converted into common stock
upon the vote to so convert of holders of a majority of the Preferred Stock then
outstanding,  voting  together  as a  separate  class.  The  Preferred  Stock is
currently convertible into an aggregate of 7,564,584 shares of common stock.

     Holders of  Preferred  Stock are  entitled to receive  dividends  on a pari
passu  basis,  if and when  dividends  are declared on the common  stock,  in an
amount equal to the dividends that would have been payable had their shares been
converted to common stock immediately prior to the record date for the dividend.

     Upon any  liquidation  of the company,  each holder of  Preferred  Stock is
entitled to receive $1,000, plus declared but unpaid dividends, if any, for each
share held,  prior to the holders of any common stock or junior  preferred stock
receiving any assets of the company available for distribution.

     Holders of  Preferred  Stock,  voting  together  as a separate  class,  are
entitled to elect two members of the board of  directors,  as long as 60% of the
Preferred  Stock  issued  and  outstanding  as of  September  26,  2001  remains
outstanding.

<PAGE>

     The holders of the  Preferred  Stock are entitled to vote together with the
holders of the common  stock on all matters  presented to our  stockholders  for
consideration,  except  that as long as the holders of the  Preferred  Stock are
entitled to vote as a separate class to elect members of the board of directors,
they will not be entitled  to vote for the  remaining  directors.  Each share of
Preferred  Stock has a number of votes  equal to the  number of shares of common
stock into which it may then be converted.

     The company may redeem all  outstanding  shares of  Preferred  Stock at any
time after  August 3, 2003,  provided  that the company can redeem  these shares
prior to August 3,  2009,  only if the market  price of the  common  stock is at
least 200% of the conversion price then in effect for any 20 consecutive trading
days ending  within 10 trading  days of the  redemption  date.  The company must
redeem all  outstanding  shares of  Preferred  Stock in two annual  installments
beginning on August 3, 2009. On any  redemption,  the  redemption  price will be
$1,000  per  share,  as  appropriately  adjusted  for any  stock  splits,  stock
dividends, combinations or similar events, plus declared but unpaid dividends.

     During 2001, the company  recorded an adjustment to net loss  applicable to
common stockholders of $4,226,000 relating to the beneficial  conversion feature
inherent  in the  issuances  of the Series B  Preferred  Stock.  This amount was
determined based upon the excess of the fair value of the company's common stock
into which the Series B Preferred  Stock was  immediately  convertible  less the
initial conversion price of $4.3358 per share in accordance with Emerging Issues
Task Force No. 98-5,  "Accounting  for  Convertible  Securities  with Beneficial
Conversion  Features or  Contingently  Adjustable  Conversion  Ratios."  For the
nine-month  period ended September 30, 2002, the company  recorded an adjustment
to  net  loss  applicable  to  common  stockholders  of  approximately  $201,000
representing  the  accretion  of the  Series  B  Preferred  Stock  and  Series C
Preferred Stock to their respective redemption values.


Note 3 - Recent Accounting Pronouncements

     In June  2002,  the  FASB  issued  SFAS  no.  146,  "Accounting  for  Costs
Associated with Exit or Disposal Activities".  SFAS 146 requires recording costs
associated  with  exit or  disposal  activities  at  their  fair  values  when a
liability has been incurred.  Under previous  guidance,  certain exit costs were
accrued upon management's  commitment to an exit plan, which is generally before
an  actual  liability  has  been  incurred.  SFAS 146 is  effective  for exit or
disposal  activities  initiated  after  December 31, 2002.  The company does not
anticipate that SFAS 146 will have a material affect on the Company's  financial
position or results of operations.










                                        5


<PAGE>



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

Overview

     Synaptic is a drug discovery company using G  protein-coupled  receptors as
the basis for  developing  new drugs  for the  treatment  of a variety  of human
disorders.

     We currently  collaborate  with Grunenthal GmbH  ("Grunenthal")  and Kissei
Pharmaceutical  Co.,  Ltd.  ("Kissei").  In  connection  with our  collaborative
arrangement with Grunenthal,  we have licensed some of our technology and patent
rights to them.  We have also  granted  licenses to some of our  technology  and
patent rights to other pharmaceutical companies.

     Since our inception,  we have financed our operations primarily through the
sale  of  our  stock,   through  contract  and  license  revenue  under  license
agreements,  and through  interest  income and capital gains  resulting from the
investment  of the  proceeds of our  financing  activities  pending use of these
funds for operational activities. We have also received funds through government
grants under the Small  Business  Innovative  Research  ("SBIR")  program of the
National  Institutes  of Health and through the sale of our New Jersey state tax
net operating loss ("NOL") carryforwards.

     To date, our  expenditures  have been for research and development  related
expenses, general and administrative related expenses, fixed asset purchases and
various patent  related  expenditures  incurred in protecting our  technologies.
Historically,  we have not been profitable,  and at September 30, 2002 we had an
accumulated deficit of $109,230,000. We incurred net losses applicable to common
stockholders  of  $26,118,000,  $13,859,000 and $15,121,000 for the fiscal years
ended  2001,  2000 and  1999,  respectively.  We  expect  to  continue  to incur
operating losses for a number of years, and we will not become profitable unless
and until we receive  royalty  revenue or revenue from sales of drugs  developed
with the use of our technology or patent rights.

Critical Accounting Policies

     Our  financial  statements  are  prepared  in  accordance  with  accounting
principles  generally  accepted  in the United  States  that  require us to make
estimates  and  assumptions.  We  believe  that  of our  significant  accounting
policies, the following may involve a higher degree of judgment and complexity:

Revenue
-------

     Revenues  that  we  receive,  or  may  receive,  are  derived  from  either
multi-element  revenue  arrangements or from research  services that we perform.
Historically,  virtually  all  revenue  that has been  recorded  has been  under
multi-element revenue arrangements. Generally, revenue is realized or realizable
and  earned  when all of the  following  criteria  are met:  (1) an  arrangement
exists,  (2) services  have been  rendered,  (3) prices of services are fixed or
determinable and (4) collectibility is reasonably  assured. As the structures of
our  arrangements  are  unique  and  may  contain  several   different   revenue
components,  each is reviewed on a case-by-case  basis in order to determine the
appropriate amount and term over which to recognize revenues.

     Under these multi-element revenue arrangements,  we may receive one or more
of the following types of revenue:  license  revenue,  research funding revenue,
milestone revenue, royalty revenue and revenue derived from sales of drugs.

<PAGE>

     License revenue represents  non-refundable payments for a license to one or
more of our patents  and/or a license to our  technology.  Payments for licenses
are recognized as they are received or, if earlier, when they become guaranteed,
provided they are independent of any continuing research activity on the related
project.  Otherwise, they are recognized pro-rata during the term of the related
research agreement in accordance with Staff Accounting Bulletin No. 101 "Revenue
Recognition in Financial Statements."

     Research  funding revenue includes payment to support a specified number of
Synaptic's  scientists.  Such revenue is  recognized  ratably over the period in
which the research is performed.

     Milestone revenue represents non-refundable payments for the achievement of
a specified  milestone  under either an existing  arrangement or under a license
that has been granted to one or more of our patents and/or our technology.  Such
payments typically  coincide with the achievement of a substantial  element in a
multi-element  arrangement  or measure  substantive  stages of  progress  toward
completion  under a long-term  contract.  The  recognition  of such  payments as
revenue  is  determined  based upon the  nature of the  underlying  arrangement.
Milestone  payments  received  under  contracts  where the company is performing
related ongoing research,  and which are deemed to have multi-element  financial
arrangements,  will be  recognized  as revenue  over the  remaining  life of the
contract. Milestone payments received under license agreements are recognized as
revenue  as they are  received  or, if  earlier,  when they  become  guaranteed,
provided they are independent of any research activity.

     Royalty revenue represents  payments that may be received from the sales of
drugs that may be developed  using the technology or the patent rights that have
been  licensed.  We are entitled to receive  royalty  payments under most of our
license agreements. To date, we have not received royalty payments and we do not
expect to receive such payments for a number of years, if at all.

     Revenue  derived from the sales of drugs would be recognized if the company
markets drugs.  The company may develop drugs on its own or in partnership  with
others.  As part of the  agreement  with  Grunenthal,  we have  development  and
marketing rights in certain  geographic areas with respect to any drugs that are
jointly identified under the agreement. Accordingly, we may receive revenue from
sales  of  drugs  in  our  designated   geographic   areas  if  we  market  them
independently,  or we may receive  royalty  payments if we license our marketing
rights to a third party. To date, we have not received revenue from the sales of
drugs.  The collaboration with Grunenthal is scheduled to expire on January 11,
2003.

Income Taxes
------------

     We account for income taxes using the liability method.  Under this method,
deferred income tax assets and liabilities reflect tax carryforwards and the net
effects of  temporary  differences  between the  carrying  amounts of assets and
liabilities for financial reporting and income tax purposes, as determined under
currently  enacted  tax  rates.  Deferred  tax  assets  are  recorded  if future
realization is more likely than not.

     Deferred  taxes are recorded  primarily for Federal and state net operating
loss   carryforwards,   research  and  development   credit   carryforwards  and
depreciation  and  amortization,  which are  reported in  different  periods for
Federal  income tax purposes than for financial  reporting  purposes.  Valuation
allowances are established, when necessary, to reduce deferred tax assets to the
amounts expected to be realized.

     At December 31, 2001, we had approximately $29,625,000 of Federal and state
net operating  loss  carryforwards  and  approximately  $1,610,000  research and
development  credit  carryforwards.  We

<PAGE>

have a history of  operating  losses and expect  these  losses to  increase as a
result of our strategy of  increasing  our internal  drug  development  efforts.
These losses would remain available to us on a carryforward  basis to offset any
future  earnings;  however,  deferred  tax  assets  attributable  to  these  net
operating  losses  have  been  fully  offset  by a  valuation  allowance  in the
financial statements, as their future realization is uncertain.

Research and Development

     We perform research for ourselves and for our current collaborators, Kissei
and  Grunenthal.  As this research  progresses,  we designate  some projects for
preclinical  and  clinical  development.  Until a lead  compound  is chosen  for
development,  all costs  associated  with that  compound  are  considered  to be
research  expense.  Costs incurred  during the research phase are not separately
identifiable by project. At this preliminary or investigational  stage, research
is  performed  within  a  broad  family  of  receptors  with  the  objective  of
identifying  lead  compounds.  Once  a  lead  compound  enters  the  preclinical
development  stage,  costs are accumulated for each project associated with that
compound.  Currently, the only project for which a lead compound has been chosen
is the  company's  depression  program.  The lead  compound in this  program was
selected  during the second  quarter of 2000.  Costs  incurred on the depression
program for the nine-month  and  inception-to-date  periods ended  September 30,
2002 approximated $5,543,000 and $8,093,000,  respectively. Total research costs
for the nine-month period ended September 30, 2002 amounted to $19,574,000.

     In general,  from the time a lead  compound is chosen  until that  compound
reaches the market,  many years may elapse.  During this time, the compound must
undergo clinical trials that include Phase I, Phase II and Phase III trials, the
results  of which are  subject to review and  approval  by the U.S.  Food & Drug
Administration  and other  regulatory  agencies.  Successful  completion of each
trial  carries its own set of risks and may cost many  millions  of dollars.  At
this stage of Phase I clinical development of the depression program, completion
costs and dates cannot be estimated.

Net Loss Applicable to Common Stockholders

     During the third  quarter of 2001,  we sold  shares of two series of senior
redeemable  convertible preferred stock the Series B Convertible Preferred Stock
and Series C Convertible  Preferred  Stock,  in a private equity  placement.  In
connection  with  these  issuances,  we  recorded  an  adjustment  to  net  loss
applicable  to common  stockholders  for the year  ended  December  31,  2001 of
approximately  $4,226,000 relating to the beneficial conversion feature inherent
in the issuances of the Series B Convertible  Preferred  Stock.  This amount was
determined based upon the excess of the fair value of the company's common stock
into which the Series B Convertible Preferred Stock was immediately  convertible
less the  initial  conversion  price of  $4.3358  per share in  accordance  with
Emerging Issues Task Force No. 98-5 "Accounting for Convertible  Securities with
Beneficial  Conversion Features or Contingently  Adjustable  Conversion Ratios."
For the nine-month period ended September 30, 2002, we recorded an adjustment to
net  loss   applicable  to  common   stockholders  of   approximately   $201,000
representing  the accretion of the Series B and Series C  Convertible  Preferred
Stock to their respective redemption values.

Results of Operations

Comparison of the Three Months Ended September 30, 2002 and 2001

     Revenues.  We  recognized  license and  contract  revenue of  $376,000  and
$374,000 for the three months ended September 30, 2002 and 2001, respectively.

<PAGE>

     Research and  Development  Expenses.  We incurred  research and development
expenses of $6,339,000,  and $4,677,000 for the three months ended September 30,
2002  and  2001,  respectively.   The  increase  of  $1,662,000,   or  36%,  was
attributable  primarily to increases in: clinical and preclinical  testing costs
associated  with the  company's  depression  program;  research and  development
salaries and fringe  benefits  resulting  from a net increase in headcount;  and
preclinical  testing costs  associated  with moving  compounds in other programs
towards development.

     General and Administrative Expenses. We incurred general and administrative
expenses of $2,446,000 and  $1,605,000 for the three months ended  September 30,
2002 and 2001, respectively.  The increase of $841,000, or 52%, was attributable
primarily to increases in:  severance costs incurred in complying with the terms
of the separation  agreement entered into with our president and chief executive
officer;  costs  incurred in  attracting  a new  president  and chief  executive
officer;  and an increase  in legal  expenses as a result of a suit filed by the
company (See "Legal Proceedings" in PART II, Item 1).

     Other  Income,  Net. We recorded  other income of $282,000 and $433,000 for
the three months ended September 30, 2002 and 2001,  respectively.  The decrease
of $151,000 was  primarily  due a decrease in interest  income  related to lower
cash, cash equivalent and marketable securities balances during 2002 as a result
of the  utilization of these  resources to fund the company's  operations and an
overall reduction in interest rates.

     Net loss  applicable  to common  stockholders.  Our net loss  applicable to
common  stockholders was $8,195,000 ($0.75 per share), and $9,791,000 ($0.89 per
share) for the three months ended September 30, 2002 and 2001, respectively. The
decrease in net loss per share of $0.14  resulted  primarily from the $4,226,000
adjustment in 2001,  described in the section  entitled "Net Loss  Applicable to
Common  Stockholders,"  partially  offset by higher  expenses  during  the third
quarter of 2002 as described above.

Comparison of the Nine Months Ended September 30, 2002 and 2001

     Revenues.  We recognized  revenue of $2,733,000 and $1,117,000 for the nine
months ended September 30, 2002 and 2001, respectively.  The increase in revenue
of $1,616,000  resulted  primarily from an increase in license revenue resulting
from  the  grant  of  licenses  for  certain   patent  rights  to  two  separate
pharmaceutical companies.

     Research and  Development  Expenses.  We incurred  research and development
expenses of $19,574,000, and $12,777,000 for the nine months ended September 30,
2002  and  2001,  respectively.   The  increase  of  $6,797,000,   or  53%,  was
attributable  primarily to increases in: clinical and preclinical  testing costs
associated  with the  company's  depression  program;  research and  development
salaries and fringe  benefits  resulting  from a net increase in headcount;  and
preclinical  testing costs  associated  with moving  compounds in other programs
towards development.

     General and Administrative Expenses. We incurred general and administrative
expenses of $6,822,000 and  $5,152,000  for the nine months ended  September 30,
2002  and  2001,  respectively.   The  increase  of  $1,670,000,   or  32%,  was
attributable  primarily to increases in:  severance  costs  associated  with the
separation  agreement  entered  into  with our  president  and  chief  executive
officer;  costs  incurred in  attracting  a new  president  and chief  executive
officer;  an increase in patent  expenses and an increase in legal expenses as a
result of a suit filed by the company (See "Legal  Proceedings" in PART II, Item
1).

<PAGE>

     Other Income,  Net. We recorded other income of $980,000 and $1,465,000 for
the nine months ended September 30, 2002 and 2001, respectively. The decrease of
$485,000 was primarily due a decrease in interest  income related to lower cash,
cash  equivalent and marketable  securities  balances during 2002 as a result of
the  utilization  of these  resources to fund the  company's  operations  and an
overall reduction in interest rates.

     Income tax benefit.  During the nine months ended  September  30, 2002,  we
recorded a $58,000  income tax  benefit  related to the sale of a portion of our
New Jersey state net operating loss carryforwards.

     Net loss  applicable  to common  stockholders.  Our net loss  applicable to
common  stockholders was $22,826,000  ($2.08 per share),  and $19,663,000 ($1.80
per share) for the nine months ended September 30, 2002 and 2001,  respectively.
The  increase  in net loss per share of $0.28  resulted  primarily  from  higher
expenses  partially  offset by higher revenues during the second quarter of 2002
as described above.

     Operating Trends.  Our revenues may vary from period to period depending on
numerous  factors,   including  the  timing  of  revenue  earned  under  license
agreements  and revenue  that may be earned under  future  collaborative  and/or
license  agreements.  During 2001 and for the nine-month  period ended September
30, 2002, we recognized revenue under our research and licensing  agreement with
Kissei  Pharmaceutical  Co.,  Ltd.  and will  continue to  recognize  additional
revenues  under this  agreement  during the  remainder of 2002.  Also during the
second  quarter of 2002 we  recognized  revenue  relating  to the  licensing  of
certain of the company's patent rights to Procter and Gamble Pharmaceuticals and
Ranbaxy Laboratories Limited. Under the terms of some of our license agreements,
revenues may be recognized if specified milestones are achieved.  We continue to
monitor our  spending  level in order to ensure that we have enough cash to last
through the second  quarter of 2003. We continue to assess the  opportunity  for
obtaining  additional funding under new collaborative  and/or license agreements
as well as through equity financings.

     Since  late  2000,  we  have  been  pursuing  a new  business  strategy  of
increasing our internal drug development efforts.  This new strategy requires us
to hire  additional  employees  with  drug  development  expertise  and to incur
additional  preclinical  expenses as well as expenses  associated  with clinical
trials. We expect to sign a contract for clinical services that may result in
approximately $2,800,000 of expenditures for the services provided under the
contract.

     Legal  expenses are expected to continue to be a  significant  expense as a
result of a suit filed by the company.  See "Legal Proceedings" in PART II, Item
1.

     Other  income,  net is  expected to  decrease  during 2002  because of less
favorable  short-term  interest rates. This decrease will,  however, be somewhat
mitigated by an increase in rental income that we expect to recognize  under our
existing sublease agreements.

     We are pursuing  further sales of our state tax NOL  carryforwards  and our
state  research  and  development  credits  under  the  State  of  New  Jersey's
Technology  Business  Tax  Certificate  Transfer  Program  (the  "Program").  No
assurance can be given,  however, as to the amount of NOL carryforwards that may
be sold under the  Program in any one year.  External  factors  that may have an
effect  on  future  NOL  sales  include  limitations  imposed  by State  law and
availability of buyers and related demand.

     Property and equipment spending may vary from period to period depending on
numerous factors, including the level of drug development efforts, the number of
collaborations  in which we are involved at any given time, and  replacement due
to normal wear and obsolescence.  Equipment  spending in 2002 has increased from
that of 2001.

<PAGE>

     At September 30, 2002, we held marketable securities with an estimated fair
value of $1,529,000.  Our primary interest rate exposure results from changes in
short-term interest rates. We do not purchase financial  instruments for trading
or speculative purposes. All of the marketable securities we hold are classified
as available-for-sale securities. The following table provides information about
marketable securities that we held at September 30, 2002:

               Principal Amount and Stated Rate by            Estimated Fair
                        Expected Maturity                         Value
------------------------------------------------------      -----------------

                      (000's)                   2003               (000's)
------------------------------------------------------     ------------------
Principal                                     $1,500              $1,529
Stated Rate                                    6.20%                --
------------------------------------------------------     ------------------


     The  stated  rates  of  interest  expressed  in the  above  table  may  not
approximate  the actual yield of the securities  that Synaptic  currently  holds
since we have  purchased  some  marketable  securities at other than face value.
Additionally,  the  securities  represented  in the above table may be called or
redeemed,  at the option of the issuer,  prior to their  expected due dates.  If
early redemptions  occur, we may reinvest the proceeds realized on such calls or
redemptions  in  marketable  securities  with stated rates of interest or yields
that are lower  than those of  current  holdings,  affecting  both  future  cash
interest streams and future earnings.

     In addition to investments in marketable  securities,  we place some of our
cash in money  market funds in order to keep cash  available to fund  operations
and to hold cash pending investments in marketable  securities.  Fluctuations in
short term interest rates will affect the yield on monies invested in such money
market  funds.  Such  fluctuations  can have an impact on future  cash  interest
streams  and  future  earnings,  but the  impact  of such  fluctuations  are not
expected to be material.

     We do not believe that  inflation has had a material  impact on our results
of operations.

Liquidity and Capital Resources

     At September 30, 2002 and December 31, 2001,  cash,  cash  equivalents  and
marketable securities aggregated $27,763,000 and $49,650,000, respectively. This
decrease was primarily the result of the  utilization of these resources to fund
our  operations.   We  intend  to  utilize  our  cash  primarily  for  research,
preclinical and clinical development costs, for patent related expenditures, for
general corporate purposes, for leasehold improvements to our facilities and for
the purchase of property and equipment. We expect to continue to incur operating
losses for a number of years.  Additionally,  we expect to sign a  contract  for
clinical  services that may result in  approximately  $2,800,000 of expenditures
for the  services  provided  under  the  contract. We  believe  that cash,  cash
equivalents  and  marketable  securities  on  hand,  and  interest  payments  on
investments,  will be sufficient to fund  operations,  as well as to support our
share of certain  development  costs  under the  Grunenthal  Agreement,  if any,
through the second quarter of 2003. We are considering  various  alternatives as
to how  best  to  raise  cash  and  in  what  amount.  The  alternatives  we are
considering  include an equity financing,  partnerships and collaborations  with
pharmaceutical and biotech companies, and possible M & A activities.

     To date, we have met our cash  requirements  through the sale of our stock,
through  contract  and  license  revenue,  through  interest  income  and  gains
resulting  from our  investments,  through  SBIR  grants  and  through  sales of
portions  of  our  state  research  and   development   credits  and  state  NOL
carryforwards.

<PAGE>

     As of  December  31,  2001,  we  had  NOL  carryforwards  of  approximately
$76,000,000 for Federal income tax purposes that will expire  principally in the
years 2002 through 2021. In addition,  we had Federal  research and  development
credit carryforwards of approximately $1,610,000 that will expire principally in
2002  through  2018.  Also at December  31, 2001,  we had NOL  carryforwards  of
approximately  $61,000,000  for state income tax purposes and state research and
development credit carryforwards of $311,000.  For financial reporting purposes,
a valuation  allowance  has been  recognized  to offset the  deferred tax assets
related to these carryforwards.

     We lease laboratory and office  facilities  under an agreement  expiring on
December  31,  2015.  The minimum  annual  payment  under the lease is currently
$1,835,000.  The lease  provides for fixed  escalations  in rent payments in the
years 2005 and 2010.























                                       12


<PAGE>



Item 3.  Quantitative and Qualitative Disclosures About Market Risk

     Quantitative and qualitative  disclosures about market risk (i.e., interest
rate risk) are included in Item 2 of this Report.




























                                       13


<PAGE>



Item 4.  Controls and Procedures

     The Company's  chief  executive  officer and principle  accounting  officer
performed an evaluation of the Company's  disclosure  controls and procedures as
of a date  within 90 days prior to the filing of this  quarterly  report on Form
10-Q.  Based on this  evaluation,  the Company  believes  that such controls and
procedures  effectively ensure that information required to be disclosed in this
quarterly report on Form 10-Q is appropriately recorded, processed and reported.
There have been no significant changes in the Company's  disclosure controls and
procedures or in other factors that could  significantly  affect these  controls
subsequent to the date of their evaluation.
















                                       14

<PAGE>



                           PART II. OTHER INFORMATION

Item 1.  Legal Proceedings

     On June 5, 2000, we filed suit in the United States  District Court for the
District of New Jersey against M.D.S. Panlabs,  Inc., a Washington  corporation,
and Panlabs Taiwan Ltd., a Taiwanese corporation (collectively,  "Panlabs"). The
suit alleges that Panlabs has  infringed  several  issued U.S.  Patents owned by
Synaptic that relate to cloned human  receptors and their use in binding assays.
The suit also alleges that Panlabs has been  importing,  selling and offering to
sell  products  of  our  patented  binding  assay  processes  to  pharmaceutical
companies and others in the United States, particularly in New Jersey.

     On December 14, 2001, we filed a suit in the United States  District  Court
for the District of New Jersey against  Euroscreen,  S.A., a Belgian corporation
("Euroscreen").  The suit alleges that Euroscreen has infringed  numerous issued
U.S.  Patents owned by us, which relate to cloned human  receptors and their use
in binding assays. The suit alleges that Euroscreen has been importing,  selling
and  offering to sell  products  of our  patented  binding  assay  processes  to
pharmaceutical  companies and others in the United States,  particularly  in New
Jersey, and that Euroscreen has conspired with Panlabs to infringe our patents.

     The suits seek injunctions against the infringing  activities of Euroscreen
and Panlabs,  damages,  the destruction of data obtained by the  infringement of
patents and other relief.

     We believe  that our  complaint  against  Panlabs  and  Euroscreen  is well
founded and necessary to protect the value of our intellectual property assets.

     We believe that an adverse resolution of the above matters would not have a
material adverse effect on our ongoing business.












                                       15


<PAGE>



Item 6.  Exhibits and Reports on Form 8-K


(a)       Exhibits

10.1     Employment agreement, dated as of September 9, 2002,between the Company
         and Dr. Errol B. De Souza, filed herewith

10.2     Incentive Stock Option Agreement, dated as of September 9, 2002,between
         the Company and Dr. Errol B. De Souza, filed herewith

10.3     Nonqualified  Stock Option  Agreement,  dated as of September  9, 2002,
         between the Company and Dr. Errol B. De Souza,  filed herewith

10.4     Nonqualified Stock Option Agreement relating to non-plan options, dated
         as of September 9, 2002, between the Company and Dr. Errol B. De Souza,
         filed herewith

99.1     Certification Pursuant to Section 906 of Sarbanes-Oxley Act of 2002


(b)      Reports on Form 8-K

     The Company  filed a Current  Report on Form 8-K during the fiscal  quarter
ended September 30, 2002 relating to a Certification  Pursuant to Section 906 of
Sarbanes-Oxley Act of 2002 certifying information in the June 30, 2002 10-Q.

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



Safe Harbor Statement

     This Report on Form 10-Q 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. Such statements  include,  but are not limited
to, those relating to future cash and spending plans, amounts of future research
funding,  and any other statements  regarding future growth,  future cash needs,
future  operations,   business  plans  and  financial  results,  and  any  other
statements which are not historical facts. When used in this document, the words
"expects," "may,"  "believes," and similar  expressions are intended to be among
the words that identify  forward-looking  statements.  Such  statements  involve
risks  and  uncertainties,  including,  but not  limited  to,  those  risks  and
uncertainties  detailed  in the  company's  Annual  Report  on Form 10-K for the
fiscal year ended December 31, 2001 (the "2001 Form 10-K"),  including in Item 1
of the 2001 Form 10-K under the captions  "Patents,  Proprietary  Technology and
Trade  Secrets,"  "Competition"  and  "Government  Regulation" as well as in the
section  entitled  "Risk  Factors" or detailed  from time to time in filings the
company makes with the SEC.  Should one or more of these risks or  uncertainties
materialize,  or should underlying assumptions prove incorrect,  actual outcomes
may vary materially from those indicated. Although the company believes that the
expectations  reflected in the forward-looking  statements  contained herein are
reasonable,  it can give no assurance  that such  expectations  will prove to be
correct.

                                       16

<PAGE>



                                 SIGNATURE PAGE


     Pursuant  to the  requirements  of  Section  13 or 15(d) 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.

                               SYNAPTIC PHARMACEUTICAL CORPORATION

Date: November 14, 2002        By:   /s/ Errol B. De Souza
                                     -------------------------------
                               Name: Errol B. De Souza
                               Title: President and Chief Executive Officer



                               By:   /s/ Edmund M. Caviasco
                                     --------------------------------
                               Name: Edmund M. Caviasco
                               Title: Controller (Principal Accounting Officer)































                                       17

<PAGE>

       CERTIFICATION PURSUANT TO SECTION 302 OF SARBANES-OXLEY ACT OF 2002

I, Errol B. De Souza, certify that:

     1. I  have  reviewed  this  quarterly  report  on  Form  10-Q  of  Synaptic
Pharmaceutical Corporation;

     2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact  necessary to make
the statements made, in light of the  circumstances  under which such statements
were made, not  misleading  with respect to the period covered by this quarterly
report;

     3. Based on my knowledge,  the financial  statements,  and other  financial
information  included in this quarterly  report,  fairly present in all material
respects the financial  condition,  results of operations  and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;

     4.The  registrant's  other  certifying  officers and I are  responsible for
establishing and maintaining  disclosure  controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

     a) designed such disclosure controls and procedures to ensure that material
information  relating to the  registrant,  is made known to us by others  within
Synaptic  Pharmaceutical  Corporation,  particularly  during the period in which
this quarterly report is being prepared;

     b) evaluated the effectiveness of the registrant's  disclosure controls and
procedures  as of a date  within  90  days  prior  to the  filing  date  of this
quarterly report (the "Evaluation Date"); and

     c)  presented  in  this  quarterly   report  our   conclusions   about  the
effectiveness of the disclosure  controls and procedures based on our evaluation
as of the Evaluation Date;

     5. The registrant's other certifying  officers and I have disclosed,  based
on our most  recent  evaluation,  to the  registrant's  auditors  and the  audit
committee  of  registrant's  board  of  directors  (or  persons  performing  the
equivalent function):

     a) all  significant  deficiencies  in the design or  operation  of internal
controls  which  could  adversely  affect  the  registrant's  ability to record,
process,  summarize  and  report  financial  data  and have  identified  for the
registrant's auditors any material weaknesses in internal controls; and

     b) any fraud,  whether or not material,  that involves  management or other
employees who have a significant role in the registrant's internal controls; and

     6. The registrant's other certifying  officers and I have indicated in this
quarterly  report  whether or not there  were  significant  changes in  internal
controls or in other factors that could  significantly  affect internal controls
subsequent to the date of our most recent  evaluation,  including any corrective
actions with regard to significant deficiencies and material weaknesses.

Date: November 14, 2002          By: /s/ Errol B. De Souza
                                     -------------------------------
                                 Name:   Errol B. De Souza
                                 Title: President and Chief Executive Officer

                                       18

<PAGE>

       CERTIFICATION PURSUANT TO SECTION 302 OF SARBANES-OXLEY ACT OF 2002

I, Edmund M. Caviasco, certify that:

     1. I  have  reviewed  this  quarterly  report  on  Form  10-Q  of  Synaptic
Pharmaceutical Corporation;

     2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact  necessary to make
the statements made, in light of the  circumstances  under which such statements
were made, not  misleading  with respect to the period covered by this quarterly
report;

     3. Based on my knowledge,  the financial  statements,  and other  financial
information  included in this quarterly  report,  fairly present in all material
respects the financial  condition,  results of operations  and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;

     4.The  registrant's  other  certifying  officers and I are  responsible for
establishing and maintaining  disclosure  controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

     a) designed such disclosure controls and procedures to ensure that material
information  relating to the  registrant,  is made known to us by others  within
Synaptic  Pharmaceutical  Corporation,  particularly  during the period in which
this quarterly report is being prepared;

     b) evaluated the effectiveness of the registrant's  disclosure controls and
procedures  as of a date  within  90  days  prior  to the  filing  date  of this
quarterly report (the "Evaluation Date"); and

     c)  presented  in  this  quarterly   report  our   conclusions   about  the
effectiveness of the disclosure  controls and procedures based on our evaluation
as of the Evaluation Date;

     5. The registrant's other certifying  officers and I have disclosed,  based
on our most  recent  evaluation,  to the  registrant's  auditors  and the  audit
committee  of  registrant's  board  of  directors  (or  persons  performing  the
equivalent function):

     a) all  significant  deficiencies  in the design or  operation  of internal
controls  which  could  adversely  affect  the  registrant's  ability to record,
process,  summarize  and  report  financial  data  and have  identified  for the
registrant's auditors any material weaknesses in internal controls; and

     b) any fraud,  whether or not material,  that involves  management or other
employees who have a significant role in the registrant's internal controls; and

     6. The registrant's other certifying  officers and I have indicated in this
quarterly  report  whether or not there  were  significant  changes in  internal
controls or in other factors that could  significantly  affect internal controls
subsequent to the date of our most recent  evaluation,  including any corrective
actions with regard to significant deficiencies and material weaknesses.

Date: November 14, 2002     By: /s/ Edmund M. Caviasco
                                -------------------------------
                            Name:   Edmund M. Caviasco
                            Title:  Controller and Principal Accounting Officer

                                       19