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 June 30, 1998

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

                                 (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  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 July 29, 1998,  there were 10,698,819  shares of the  registrant's  Common
Stock outstanding.


<PAGE>



                       SYNAPTIC PHARMACEUTICAL CORPORATION

   INDEX TO QUARTERLY REPORT ON FORM 10-Q FOR THE QUARTER ENDED JUNE 30, 1998


                          PART I. FINANCIAL INFORMATION

                                                                         Page
                                                                         ----
Item 1. Financial Statements                                               1

Balance Sheets at June 30, 1998 and December 31, 1997                      1

Statements of Operations and Comprehensive Income (Loss) for
  the three months ended June 30, 1998 and 1997, and for the
  six months ended June 30, 1998 and 1997                                  2

Statements of Cash Flows for the six months ended
 June 30, 1998 and 1997                                                    3

Notes to Financial Statements                                              4

Item 2. Management's Discussion and Analysis of Financial
  Condition and Results of Operations                                      5


                           PART II. OTHER INFORMATION

Item 2. Changes in Securities and Use of Proceeds                          8

Item 4. Submission of Matters to a Vote of Security Holders                9

Item 5. Other Information                                                 10

Item 6. Exhibits and Reports on Form 8-K                                  11

Signatures                                                                12



























                                      (i)


<PAGE>



                          PART I. FINANCIAL INFORMATION


Item 1. Financial Statements


                       SYNAPTIC PHARMACEUTICAL CORPORATION
                                 BALANCE SHEETS
                    (in thousands, except share information)


                                     ASSETS

                                                        June 30,  December 31,
                                                          1998          1997
                                                      ----------  -----------
                                                      (Unaudited)   (Audited)
Current assets:
 Cash and cash equivalents                               $13,448      $23,113
 Restricted cash                                             600          600
 Marketable securities--current maturities                 7,747       10,010
 Revenue receivable under collaborative agreement            160           40
 Other current assets                                      1,158          674
                                                         -------      -------
  Total current assets                                    23,113       34,437

Property and equipment, net                                4,962        4,682

Marketable securities                                     40,309       28,977

Patent and patent application costs,
  net of accumulated amortization                          1,132        1,306
                                                         -------      -------
                                                         $69,516      $69,402
                                                         =======      =======



                      LIABILITIES AND STOCKHOLDERS' EQUITY



Current liabilities:
 Accounts payable                                        $   606      $   811
 Accrued liabilities                                         560          547
 Accrued compensation                                        240          340
 Unearned revenue under research agreement                   313           --
                                                         -------      -------
  Total current liabilities                                1,719        1,698

Stockholders' equity:
 Preferred Stock, $.01 par value; authorized--
  1,000,000 shares; issued--none                              --           --
 Common Stock, $.01 par value; authorized--
  25,000,000 shares; issued and outstanding--
  10,698,207 shares in 1998 and 10,526,585 shares
  in 1997;                                                   107          105
 Additional paid-in capital                               98,401       97,049
 Deferred compensation                                       (99)        (160)
 Accumulated deficit                                     (30,662)     (29,316)
 Accumulated other comprehensive income--
  net unrealized gains on securities                          50           26
                                                         -------      -------
  Total stockholders' equity                              67,797       67,704
                                                         -------      -------
                                                         $69,516      $69,402
                                                         =======      =======










                       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 six months
                                ended June 30,            ended June 30,
                               1998         1997         1998         1997
                             -------      -------      -------      -------
Revenues:
 Contract revenue            $ 2,148      $ 2,755      $ 4,313      $ 5,310
 License revenue                  --           --        2,000           --
 Grant revenue                    60          102          150          242
                             -------      -------      -------      -------
  Total revenues               2,208        2,857        6,463        5,552

Expenses:
 Research and development      3,851        3,343        7,512        6,691
 General and administrative    1,085          957        2,168        1,922
                             -------      -------      -------      -------
  Total expenses               4,936        4,300        9,680        8,613
                             -------      -------      -------      -------
Loss from operations          (2,728)      (1,443)      (3,217)      (3,061)

Other income, net:
 Interest income                 953          485        1,871          970
 Interest expense                 --           (1)          --           (4)
                             -------      -------      -------      -------
  Other income, net              953          484        1,871          966
                             -------      -------      -------      -------
Net loss                     $(1,775)     $  (959)     $(1,346)     $(2,095)
                             =======      =======      =======      =======


Comprehensive loss:

Net loss                     $(1,775)     $  (959)     $(1,346)     $(2,095)

Other comprehensive
 income (loss)--unrealized
  holding gains (losses)
  arising during period          121         (163)          24            6
                             -------      -------      -------      -------
Comprehensive loss           $(1,654)     $(1,122)     $(1,322)     $(2,089)
                             =======      =======      =======      =======




Basic and diluted net loss
 per share                    $(0.17)      $(0.13)      $(0.13)      $(0.27)
                              ======       ======       ======       ======
Shares used in
 computation of basic
 and diluted net loss
 per share                10,691,744    7,646,085   10,668,641    7,640,454
                          ==========    =========   ==========    =========


















                       See notes to financial statements.

                                        2


<PAGE>



                       SYNAPTIC PHARMACEUTICAL CORPORATION
                            STATEMENTS OF CASH FLOWS
                                 (in thousands)
                                   (Unaudited)
                                                        For the six months
                                                          ended June 30,
                                                        1998          1997
                                                       -------      -------
Operating activities:

Net loss                                               $(1,346)     $(2,095)
Adjustments to reconcile net loss to net
 cash used in operating activities:
Depreciation and amortization                              702          584
Amortization of premiums/(discounts) on securities          74          (72)
Amortization of deferred compensation                       41           65
Changes in operating assets and liabilities:
Increase in other current assets                          (484)        (130)
Decrease in accounts payable, accrued liabilities
  and accrued compensation                                (291)        (317)
Increase in collaborative agreement
  revenue receivable                                      (120)          --
Increase in deferred revenue                               313           --
                                                       -------      -------
Net cash used in operating activities                   (1,111)      (1,965)


Investing activities:

Sale or maturity of investments                         30,000       10,350
Purchase of investments                                (39,120)      (3,943)
Purchases of property and equipment                       (808)      (1,661)
                                                       -------      -------
Net cash (used in) provided by investing activities     (9,928)       4,746


Financing activities:

Issuance of common stock, net of repurchases             1,374           23
Payments on capital lease                                   --          (61)
                                                       -------      -------
Net cash provided by (used in) financing activities      1,374          (38)
                                                       -------      -------

Net (decrease) increase in cash and cash equivalents    (9,665)       2,743


Cash and cash equivalents at beginning of period        23,113        4,589
                                                       -------      -------

Cash and cash equivalents at end of period             $13,448      $ 7,332
                                                       =======      =======


























                       See notes to financial statements.

                                        3


<PAGE>



                       SYNAPTIC PHARMACEUTICAL CORPORATION
                          NOTES TO FINANCIAL STATEMENTS
                                  June 30, 1998


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
generally accepted  accounting  principles.  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, 1997, and
notes  thereto  included in the Company's  1997 Annual Report on Form 10-K.  The
results of  operations  for the fiscal  quarter  ended  June 30,  1998,  are not
necessarily  indicative of the results of operations to be expected for the full
year.


Note 2 -- New Accounting Standard

         In June 1997, the Financial Accounting Standards Board issued Statement
of Financial  Accounting  Standards No. 130, "Reporting  Comprehensive  Income."
This pronouncement,  which was required to be adopted effective January 1, 1998,
requires the presentation of a statement of comprehensive income.  Comprehensive
income (loss) is defined as the change in equity of a business enterprise during
a period  resulting from  transactions and other events and  circumstances  from
nonowner sources.  Comprehensive loss for the Company,  in addition to net loss,
includes  unrealized  gains and losses on marketable  securities  held for sale,
currently recorded in stockholders' equity.















































                                        4


<PAGE>



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

Overview

         Synaptic Pharmaceutical  Corporation is a biotechnology company engaged
in the  development  of a broad platform of enabling  technology  which it calls
"human   receptor-targeted   drug  design  technology."  It  is  utilizing  this
technology  both to  discover  and clone the genes that code for human  receptor
subtypes  associated  with specific  disorders and to design  compounds that can
potentially be developed as drugs for treating these  disorders.  The Company is
currently  engaged in collaborations  with four  pharmaceutical  companies:  Eli
Lilly and Company  ("Lilly"),  Merck & Co., Inc.  ("Merck"),  The Warner-Lambert
Company  ("Warner-Lambert")  and Grunenthal GmbH  ("Grunenthal").  In connection
with these  collaborations,  the Company has granted to these companies licenses
under  certain  patent  rights and to certain  technology.  The Company had been
engaged in a collaboration  with Novartis Pharma AG ("Novartis") and had granted
to Novartis a license under certain patent rights and to certain technology.  On
August 3, 1998, the  collaboration and related research funding support provided
by Novartis ended in accordance with the terms of the Company's  agreements with
Novartis.  Novartis  continues to have a license under certain patent rights and
to certain  technology  of the  Company.  The Company has also granted a license
under  certain  patent  rights,  as well as an option  to  obtain an  additional
license under certain patent  rights,  to Glaxo Group Limited  ("Glaxo").  Since
inception, the Company has financed its operations primarily through the sale of
stock, through funds provided by its collaborative  partners Lilly and Merck and
former  collaborative  partner Novartis under their agreements with the Company,
through funds  provided by its licensee,  Glaxo,  under a license  agreement and
through  interest income and capital gains resulting from its  investments.  The
Company also receives  revenues from government  grants under the Small Business
Innovative Research ("SBIR") program of the National Institutes of Health.

         Under its collaborative and license agreements, the Company may receive
one or more  of the  following  types  of  revenue:  contract  revenue,  license
revenue,  royalty revenue or revenue from the sales of drugs.  Contract  revenue
includes  research  funding  to  support a  specified  number  of the  Company's
scientists  and  payments  upon  the  achievement  of  specified   research  and
development milestones.  Research funding revenue is recognized ratably over the
period of the  agreement  to which it relates  and is based  upon  predetermined
funding  requirements.  Research and  development  milestone  payment revenue is
recognized  when the related  research or  development  milestone  is  achieved.
License revenue represents  non-refundable payments for a license to one or more
of  the  Company's  patents  and/or  a  license  to  the  Company's  technology.
Non-refundable  payments for licenses  are  recognized  at such time as they are
received or, if earlier,  become  guaranteed.  Under its agreements  with Lilly,
Merck,  Warner-Lambert,  Glaxo and Novartis,  the Company is entitled to receive
royalty  payments based upon the sales of drugs that may be developed  using the
Company's  technology.  Under its  agreement  with  Grunenthal,  the Company has
development and marketing  rights in certain  territories with respect to drugs,
if any, that are jointly identified as part of the  collaboration.  Accordingly,
the Company may receive  revenue from sales in its  territories  (as defined) of
such drugs if it markets them  independently  or the Company may receive royalty
payments if it licenses  its  marketing  rights to a third party.  To date,  the
Company has not  received  either  royalty  revenue or revenue from the sales of
drugs and the Company does not expect to receive  such  revenues for a number of
years, if at all.

         To  date,  the  Company's  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
the Company's technologies.  The Company has been historically  unprofitable and
had an accumulated  deficit of $30,662,000 at June 30, 1998. The Company expects
to continue to incur  operating  losses for a number of years and may not become
profitable,  if at all, unless and until it receives  royalty revenue or revenue
from sales of drugs that may be developed  with the use of its technology or its
patent rights.

Results of Operations

Comparison of the Three Months Ended June 30, 1998 and 1997

         Revenues.  The Company  recognized revenue of $2,208,000 and $2,857,000
for the three months ended June 30, 1998 and 1997, respectively. The decrease of
$649,000 was  attributable  primarily  to a net decrease in contract  revenue of
$607,000  which  is  primarily  due to the  reduction  in  full-time  equivalent
scientists being funded under one of the Company's collaborative arrangements.

         Research  and  Development  Expenses.  The Company   incurred  research
and development  expenses  of $3,851,000,  and $3,343,000  for the  three months
ended June 30, 1998 and 1997,  respectively.  The  increase of $508,000, or 15%,
in research and
                                        5


<PAGE>



development  expenses was attributable  primarily to: an increase of $246,000 in
compensation and fringe benefit expenses  resulting from a net average headcount
increase of 6 research  personnel  as well as annual  salary  increases  for the
scientific staff; and an increase of $131,000 in facility related costs.

         General and Administrative  Expenses.  The Company incurred general and
administrative  expenses of  $1,085,000  and $957,000 for the three months ended
June 30, 1998 and 1997,  respectively.  The  increase of  $128,000,  or 13%, was
attributable  primarily  to: an  increase  of $48,000 in  compensation  expenses
resulting  from a net average  headcount  increase as well as annual  salary and
bonus increases for the administrative  staff; an increase of $161,000 in patent
costs,  which includes one-time charges  associated with resisting a third party
opposition to the issuance to the Company of a foreign patent, all of which were
offset by a decrease of $89,000 in legal costs. The additional  $89,000 in legal
costs  reported for the second  quarter of 1997 was  primarily  attributable  to
negotiations relating to a new collaboration.

         Other Income,  Net. The Company  recorded  other income of $953,000 and
$484,000 for the three months  ended June 30, 1998 and 1997,  respectively.  The
increase of $469,000 was primarily due to higher  interest income as a result of
higher cash,  cash  equivalent and marketable  securities  balances  during 1998
which  resulted from the receipt of net proceeds  from a public  offering of its
common stock completed in November 1997.

         Net Loss and  Basic  and  Diluted  Net  Loss  Per  Share.  The net loss
incurred by the Company was $1,775,000  ($0.17 per share),  and $959,000  ($0.13
per share) for the three months ended June 30, 1998 and 1997, respectively.  The
increase in net loss per share of $0.04 resulted  primarily from the decrease in
revenues and increase in expenses as described above.

Comparison of the Six Months Ended June 30, 1998 and 1997

         Revenues.  The Company  recognized revenue of $6,463,000 and $5,552,000
for the six months ended June 30, 1998 and 1997,  respectively.  The increase of
$911,000  was  attributable  primarily  to an  increase  in  license  revenue of
$2,000,000.  This  increase in license  revenue was offset by a net  decrease in
contract  revenue  of  $997,000  which  is  primarily  due to the  reduction  in
full-time  equivalents  scientists  being  funded  under  one of  the  Company's
collaborative arrangements.

         Research and Development  Expenses.  The Company incurred  research and
development expenses of $7,512,000, and $6,691,000 for the six months ended June
30, 1998 and 1997,  respectively.  The increase of $821,000, or 12%, in research
and development expenses was attributable  primarily to: an increase of $474,000
in  compensation  and  fringe  benefit  expenses  resulting  from a net  average
headcount  increase of 9 research  personnel as well as annual salary  increases
for the scientific staff; and an increase of $150,000 in facility related costs.

         General and Administrative  Expenses.  The Company incurred general and
administrative  expenses of $2,168,000  and  $1,922,000 for the six months ended
June 30, 1998 and 1997,  respectively.  The  increase of  $246,000,  or 13%, was
attributable  primarily  to: an increase of  $105,000  in  compensation  expense
resulting  from a net average  headcount  increase as well as annual  salary and
bonus increases for the administrative  staff; an increase of $176,000 in patent
costs,  which includes one-time charges  associated with resisting a third party
opposition to the issuance to the Company of a foreign patent, all of which were
offset by a decrease of $86,000 in legal costs. The additional  $86,000 in legal
costs  reported  for the  first  half  of 1997  was  primarily  attributable  to
negotiations relating to a new collaboration.

         Other Income,  Net. The Company recorded other income of $1,871,000 and
$966,000  for the six months  ended June 30,  1998 and 1997,  respectively.  The
increase of $905,000 was primarily due to higher  interest income as a result of
higher cash,  cash  equivalent and marketable  securities  balances  during 1998
which  resulted from the receipt of net proceeds  from a public  offering of its
common stock completed in November 1997.

         Net Loss and  Basic  and  Diluted  Net  Loss  Per  Share.  The net loss
incurred by the Company was $1,346,000 ($0.13 per share),  and $2,095,000 ($0.27
per share) for the three months ended June 30, 1998 and 1997, respectively.  The
decrease in net loss per share of $0.14  resulted  primarily from higher license
revenue and higher interest income offset by higher expenses as described above.

         The Company does not believe that  inflation has had a material  impact
on its results of operations.






                                        6


<PAGE>



Liquidity and Capital Resources

         At June 30, 1998 and December  31, 1997,  cash,  cash  equivalents  and
marketable securities aggregated $61,504,000 and $62,100,000,  respectively. The
$61,504,000  of  cash,  cash  equivalents  and  marketable  securities  includes
$313,000 of research  funding  received in advance from Novartis for research to
be performed during the third quarter. In addition to the cash, cash equivalents
and  marketable   securities  described  above,  the  Company  had  $600,000  in
restricted  cash recorded in its balance sheet at June 30, 1998. This restricted
cash secures lease payments to the Company's landlord for one full year.

         To date, the Company has met its cash requirements  through the sale of
its stock, through contract and license revenue, through SBIR grants and through
interest income and gains resulting from its  investments.  As of June 30, 1998,
the Company had received: $97,700,000 from the sale of its stock; $57,000,000 in
licensing fees,  research funding and milestone payments under its collaborative
and license  agreements;  $3,500,000  in SBIR grants;  and  $8,100,000  in other
income,  net. To date,  the portion of these funds that has been expended by the
Company has been used principally to fund research and development,  to purchase
fixed assets used  primarily in its  research  activities,  to create its patent
estate and to pay general and administrative support costs.

         During the period  from  January 1, 1998  through  June 30,  1998,  the
Company received research funding under three of its collaborative arrangements.
During the period  from July 1, 1998  through  December  31,  1998,  the Company
expects to receive $2,700,000 in the aggregate under two of its  collaborations.
Research  funding  under  the  Lilly  collaboration  is  scheduled  to expire on
December 31, 1998.  Research funding under the Merck  collaboration is scheduled
to expire  on  November  30,  1998 but  Merck  has the  right to  terminate  the
collaboration  and such funding earlier by giving 90 days' prior written notice.
Research  funding  under the Novartis  collaboration  ended on August 3, 1998 in
accordance with the terms of the underlying agreements.

         At June 30, 1998,  the Company had invested an aggregate of  $9,255,000
in property and equipment.  The Company leases  laboratory and office facilities
under an agreement  expiring on December 31, 2015.  The minimum  annual  payment
under the lease is currently $674,000.

         At June 30, 1998 the Company had $61,504,000 in cash, cash  equivalents
and marketable securities.  The Company intends to utilize these funds primarily
to  conduct  its  current  and future  research  programs,  for  patent  related
expenditures,  for general corporate purposes and to make leasehold improvements
to its  facilities  beyond the level which existed on June 30, 1998. The Company
expects to  continue  to incur  operating  losses for a number of years and will
require the use of cash to finance its capital  programs.  The Company  believes
that its cash on hand,  together  with the funds that it expects to receive from
its  collaborative  partners and interest  income will be sufficient to fund: an
increased  operating expense level; the Company's portion of its shared costs of
certain development  activities under its collaboration with Grunenthal;  and an
increased level of capital spending through the year 2000.

         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
"expect,"  "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 under the captions "Patents,  Proprietary Technology and
Trade  Secrets,"  "Competition"  and  "Government  Regulation"  in the Company's
Annual  Report on Form 10-K for the fiscal  year ended  December  31,  1997 (the
"1997 Form 10-K") as well as those risks and  uncertainties  disclosed under the
captions  "Early  Stage  of  Product  Development;  Technological  Uncertainty,"
"Dependence on Collaborative Partners and Licensees for Development,  Regulatory
Approvals,  Manufacturing,  Marketing and Other  Resources"  and  "Uncertainties
Related to Clinical Trials" as "Cautionary  Statements" in the 1997 Form 10-K 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 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. The Company expressly disclaims
any obligation or  undertaking  to  disseminate  any updates or revisions to any
forward  looking  statement  contained  herein  to  reflect  any  change  in the
Company's  expectations with regard thereto or any change in events,  conditions
or circumstances on which any such statement is based.


                                        7


<PAGE>



                           PART II. OTHER INFORMATION


Item 2.  Changes in Securities and Use of Proceeds


         Securities Act Rule 229.463 ("Rule 463") required  issuers to report on
Form SR their use of proceeds,  following an initial public offering, within ten
days of the first three months  following the effective date of the registration
statement,  and every six months  thereafter,  until the application of all such
proceeds was  complete.  Effective  September  2, 1997,  pursuant to Release No.
34-38850,  the Securities and Exchange  Commission  ("SEC")  amended Rule 463 to
eliminate  Form SR and now  requires  a  first-time  registrant  to  report  the
application  of proceeds in each of its periodic  reports filed  pursuant to the
requirements  under the Exchange Act until the  application  of such proceeds is
complete. Prior to September 2, 1997, the Company utilized Form SR to report the
application  of proceeds  received by the Company  following its initial  public
offering.

         The information  provided below represents a reasonable estimate of the
cumulative  application,   through  June  30,  1998,  of  the  net  proceeds  of
$25,194,000 which were received  following the Company's initial public offering
on December 13, 1995:


Construction of plant, building and facilities                       $   425,000

Purchase and installation of machinery and equipment                 $ 3,918,000

Working capital used to fund operations                              $18,235,000


         Except for payments described in the following sentence, the cumulative
application of the net offering proceeds listed above represents direct payments
to others. No payments were made to directors or officers or to their associates
except for payments made in the ordinary  course of business which include,  but
may not be limited to, the payment of officer  salaries,  fringe  benefits,  and
expense reimbursements or compensation paid to directors for their attendance at
board  meetings or for their services  provided to the Company under  consulting
arrangements, if any.

         At June 30, 1998, the status of proceeds pending final  application are
as follows:


Temporary investment of proceeds in marketable securities            $ 2,616,000



































                                        8


<PAGE>



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


         On May 12, 1998,  the Company held its annual  meeting of  stockholders
for the following  purposes:  (i) to elect three Class II directors to the Board
of Directors  (Proposal No. 1); (ii) to amend the Company's  1996 Incentive Plan
in order to increase  the number of shares of Common Stock  available  for award
under such Plan and to bring the Plan into compliance with Section 162(m) of the
Internal Revenue Code of 1986, as amended  (Proposal No. 2); and (iii) to ratify
the  appointment  by  the  Board  of  Directors  of  Ernst  &  Young  LLP as the
independent auditors of the Company for the fiscal year ending December 31, 1998
(Proposal No.
3).

         The  stockholders  elected  the  persons  named  below,  the  Company's
nominees for director,  as Class II directors of the Company,  casting votes for
such nominees or withholding votes as indicated:


                                    VOTES FOR                VOTES WITHHELD

Jonathan J. Fleming                 7,906,914                    338,092
Eric R. Kandel                      7,906,914                    338,092
John E. Lyons                       7,906,914                    338,092


         The stockholders approved Proposal No. 2 as follows:


VOTES FOR         VOTES AGAINST         VOTES ABSTAINED       BROKER NON-VOTES

3,771,233           2,117,995                   6,120          2,349,658



         The stockholders approved Proposal No. 3 as follows:


VOTES FOR         VOTES AGAINST         VOTES ABSTAINED       BROKER NON-VOTES

8,241,906               2,300                     800                  0








































                                        9


<PAGE>



Item 5.  Other Information


         The Company, in collaboration with Lilly, is currently  conducting drug
discovery  programs  focused  on a number of  serotonin  receptor  subtypes  and
therapeutic applications.  With respect to the drug discovery program focused on
the   identification  and  development  of  serotonin  2B  antagonists  for  the
prophylactic  treatment  of  migraine,  Lilly  selected a compound  for possible
development  and conducted late  preclinical  testing of the compound.  However,
Lilly recently  determined that, as a result of competing  priorities,  it would
not  continue to develop  this  compound  and would  instead  seek a licensee or
development partner for the compound.  Lilly's determination with respect to the
migraine  prophylaxis  program does not affect the acute migraine  program which
Lilly is  conducting  in  collaboration  with the  Company.  The acute  migraine
program is focused on the  development of a serotonin  1F-selective  agonist for
the treatment of acute migraine. Lilly is currently conducting Phase II clinical
trials with a compound that is the subject of this program.

         On  August  3,  1998,  the  term of the  Company's  collaboration  with
Novartis, which was focused principally on the identification and development of
neuropeptide Y drugs for the treatment of obesity and eating disorders,  as well
as  cardiovascular  disorders,  expired  in  accordance  with  the  terms of the
Research and License  Agreement dated as of August 4, 1994, as amended,  and the
Research and License  Agreement dated as of May 31, 1996. In connection with the
expiration  of the  collaboration,  Novartis'  obligation to provide the Company
with  funding  to  support  a  specified  number  of  the  Company's  scientists
terminated. Novartis continues to have a license under certain patent rights and
to certain  technology of the Company  pursuant to the terms of the Research and
License Agreements.

         The  Company,  in  collaboration  with  Warner-Lambert,   is  currently
conducting  drug  discovery  programs  focused on a number of  galanin  receptor
subtypes and therapeutic applications. As part of the collaboration, the Company
and  Warner-Lambert  have identified small molecule compounds that are selective
for certain of the galanin receptor subtypes.

         For a general  description of Phase II clinical  trials,  the early and
late  preclinical  stages of  testing  and other  stages of drug  discovery  and
development, see the Company's 1997 Form 10-K.










































                                       10


<PAGE>



Item 6.  Exhibits and Reports on Form 8-K


(a) Exhibits

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

10.1        Incentive Stock Option Agreement dated as of May 12, 1998, between
            the Company and Theresa A. Branchek (filed herewith)

10.2        Nonqualified Stock Option Agreement dated as of May 12, 1998,
            between the Company and Theresa A. Branchek (filed herewith)

27          Financial Data Schedule


(b)         Reports on Form 8-K

The  Company  did not file any  Current  Reports  on Form 8-K  during the fiscal
quarter ended June 30, 1998.


























































                                       11


<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
                                        (Registrant)



Date: August 7, 1998          By:/s/ Kathleen P. Mullinix
                                 -----------------------------
                              Name: Kathleen P. Mullinix
                              Title: Chairman, President &
                                     Chief Executive Officer



                              By:/s/ Robert L. Spence
                                 -----------------------------
                              Name: Robert L. Spence
                              Title: Senior Vice President,
                                     Chief Financial Officer &
                                     Treasurer






















































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