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 March 31, 1997

                                       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 May 1, 1997, there were 7,646,354 shares of the registrant's  Common Stock
outstanding.


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                       SYNAPTIC PHARMACEUTICAL CORPORATION

   INDEX TO QUARTERLY REPORT ON FORM 10-Q FOR THE QUARTER ENDED MARCH 31, 1997


                          PART I. FINANCIAL INFORMATION

                                                                         Page
                                                                         ----
Item  1. Financial Statements                                              1

Balance Sheets at March 31, 1997 and December 31, 1996                     1

Statements of Operations for the three months ended
  March 31, 1997 and 1996                                                  2

Statements of Cash Flows for the three months ended
  March 31, 1997 and 1996                                                  3

Note to Financial Statements                                               4

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


                           PART II. OTHER INFORMATION

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

Signatures                                                                 9























                                       (i)


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                          PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

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

                                     ASSETS
                                                      March 31,   December 31,
                                                        1997           1996
                                                     ----------   -----------
                                                     (Unaudited)   (Audited)
Current assets:
Cash and cash equivalents                               $ 3,717       $ 4,589
Restricted cash                                             712            --
Marketable securities--current maturities                20,228        21,418
Revenue receivable under collaborative agreement            192           192
Restricted security                                          --           712
Other current assets                                        663           458
                                                        -------       -------
Total current assets                                     25,512        27,369

Property and equipment, net                               3,533         2,664

Marketable securities                                     8,641         8,677

Patent and patent application costs,
  net of accumulated amortization                         1,561         1,645
                                                        -------       -------
                                                        $39,247       $40,355
                                                        =======       =======

                      LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
Current portion of capital lease obligations            $    84       $   106
Accounts payable                                            609           639
Accrued liabilities                                         342           189
Accrued compensation                                        102           380
                                                        -------       -------
Total current liabilities                                 1,137         1,314

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--7,635,756 shares in
1997 and 7,633,543 shares in 1996; outstanding--
7,635,443 shares in 1997 and 7,633,543 shares in 1996        76            76
Additional paid-in capital                               63,229        63,231
Net unrealized gains on securities                          168            (1)
Deferred compensation                                      (257)         (296)
Accumulated deficit                                     (25,105)      (23,969)
                                                        -------       -------
                                                         38,111        39,041
Less: Treasury stock, at cost                                (1)           --
                                                        -------       -------
Total stockholders' equity                               38,110        39,041
                                                        -------       -------
                                                        $39,247       $40,355
                                                        =======       =======

                        See note to financial statements.


                                        1


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                       SYNAPTIC PHARMACEUTICAL CORPORATION
                            STATEMENTS OF OPERATIONS
             (in thousands, except share and per share information)
                                   (Unaudited)




                                                For the three months
                                                    ended March 31,
                                                 1997          1996
                                                -------      -------
Revenues:

Contract revenue                                $ 2,555      $ 1,711
Grant revenue                                       140           70
                                                -------      -------
Total revenues                                    2,695        1,781

Expenses:

Research and development                          3,348        2,663
General and administrative                          965          685
                                                -------      -------
Total expenses                                    4,313        3,348
                                                -------      -------
Loss from operations                             (1,618)      (1,567)

Other income, net:

Interest income                                     485          469
Interest expense                                     (3)          (6)
                                                -------      -------
Other income, net                                   482          463
                                                -------      -------
Net loss                                        $(1,136)     $(1,104)
                                                =======      =======


Net loss per share                               $(0.15)      $(0.15)
                                                 ======       ======


Shares used in computation of net loss
  per share                                   7,634,760    7,494,020
                                              =========    =========

















                        See note to financial statements.

                                        2


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                       SYNAPTIC PHARMACEUTICAL CORPORATION
                            STATEMENTS OF CASH FLOWS
                                 (in thousands)
                                   (Unaudited)
                                                        For the three months
                                                          ended March 31,
                                                        1997          1996
                                                       -------      -------
Operating activities:

Net loss                                               $(1,136)     $(1,104)
Adjustments to reconcile net loss to net cash
 used in operating activities:
Depreciation and amortization                              270          242
Amortization of (discounts)/ premiums on securities        (50)          10
Amortization of deferred compensation                       33           37
Changes in operating assets and liabilities:
Increase in other current assets                          (917)        (102)
Decrease in accounts payable, accrued liabilities
  and accrued compensation                                (155)        (420)
Increase in collaborative agreement
  revenue receivable                                        --         (387)
Decrease in deferred revenue                                --         (821)
                                                       -------      -------
Net cash used in operating activities                   (1,955)      (2,545)


Investing activities:

Sale or maturity of investments                          4,400        2,000
Purchase of investments                                 (2,243)          --
Purchases of property and equipment                     (1,055)        (129)
Increase in patent and patent application costs             --         (145)
                                                       -------      -------
Net cash provided by investing activities                1,102        1,726


Financing activities:

Issuance of common stock, net of repurchases                 3        2,476
Payments on capital lease                                  (22)         (33)
Payments on notes receivable from stockholders              --            6
                                                       -------      -------
Net cash (used in) provided by financing activities        (19)       2,449
                                                       -------      -------

Net (decrease) increase in cash and cash equivalents      (872)       1,630


Cash and cash equivalents at beginning of period         4,589       27,681
                                                       -------      -------

Cash and cash equivalents at end of period             $ 3,717      $29,311
                                                       =======      =======










                        See note to financial statements.

                                        3


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                       SYNAPTIC PHARMACEUTICAL CORPORATION
                          NOTE TO FINANCIAL STATEMENTS
                                 March 31, 1996


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, 1996, and
notes  thereto  included in the Company's  1996 Annual Report on Form 10-K.  The
results of  operations  for the fiscal  quarter  ended March 31,  1997,  are not
necessarily  indicative of the results of operations to be expected for the full
year.













































                                        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
engaged in  collaborations  with four  pharmaceutical  companies:  Eli Lilly and
Company  ("Lilly"),   Merck  &  Co.,  Inc.   ("Merck"),   Novartis  Pharma  A.G.
("Novartis"),  and The Dupont Merck  Pharmaceutical  Company  ("Dupont  Merck").
Since inception,  the Company has financed its operations  primarily through the
sale of stock and through funds provided by its  collaborative  partners  Lilly,
Merck and Novartis under collaborative agreements.

         Under its collaborative agreements,  the Company may receive one or two
types of revenue from its collaborative  partners:  contract revenue and license
revenue.  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  milestone  payment
revenue is recognized when the related research  milestone is achieved.  License
revenue  represents  non-refundable  payments  for  licenses  to  the  Company's
technology and drug discovery systems.  Non-refundable payments for licenses are
recognized at such time as they are received or, if earlier,  become guaranteed.
In addition to contract revenue and license revenue, if a drug is developed as a
result  of any of the  collaborative  agreements  between  the  Company  and its
collaborative  partners,  the Company is entitled  to receive  royalty  payments
based upon the sale of such drugs.

         The Company also  receives  revenues from  government  grants under the
Small Business  Innovative  Research ("SBIR") program of the National Institutes
of Health.

         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 $25,105,000 at March 31, 1997. The Company expects
to continue to incur operating losses for a significant  number of years and may
not become profitable, if at all, until it begins to receive royalty revenue. To
date,  the Company has not received  any royalty  revenue and does not expect to
receive such revenue for a significant number of years, if at all.

Results of Operations

Comparison of the Three Months Ended March 31, 1997 and 1996

         Revenues.  The Company  recognized revenue of $2,695,000 and $1,781,000
for the three months ended March 31, 1997 and 1996,  respectively.  The increase
of $914,000 was  attributable  primarily to: an increase in contract  revenue of
$844,000;  and an increase in grant revenue of $70,000. The increase in contract
revenue was  primarily  due to: the  expansion  of the  Company's  collaborative
arrangement  with  Lilly;  and  an  increase  in  rates  charged  per  full-time
equivalent scientist under all of the collaborative  arrangements from which the
Company is receiving funding.

         Research and Development Expenses.  The Company incurred research and
development expenses of $3,348,000, and $2,663,000 for the three months ended
March 31, 1997 and 1996, respectively.  The increase of $685,000, or 26%, in

                                        5


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research and development expenses was attributable  primarily to: an increase of
$319,000 in compensation  and recruiting  expenses  resulting from a net average
headcount increase of 20 research personnel and an associated increase in fringe
benefit expenses as well as annual salary increases for the scientific staff; an
increase  of  $265,000  in  research  supply  costs  resulting  from the  higher
headcount as well as increased assays  performed under the Lilly  collaboration;
and a net  increase of $101,000 in all other  research and  development  expense
items.

         General and Administrative  Expenses.  The Company incurred general and
administrative  expenses of $965,000  and  $685,000  for the three  months ended
March 31, 1997 and 1996,  respectively.  The increase of  $280,000,  or 41%, was
attributable primarily to $240,000 in patent and patent related expenses for the
quarter ended March 31, 1997 resulting from a change in the Company's accounting
estimate,  effective October 1, 1996,  regarding the expensing of all patent and
patent application costs as incurred.

         Other Income,  Net. The Company recorded other income,  net of interest
expense,  of $482,000 and $463,000 for the three months ended March 31, 1997 and
1996, respectively.

         Net Loss and Net Loss Per Share.  The net loss  incurred by the Company
was $1,136,000 ($0.15 per share), and $1,104,000 ($0.15 per share) for the three
months ended March 31, 1997 and 1996, respectively.

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

Liquidity and Capital Resources

         At March 31, 1997 and December 31, 1996,  cash,  cash  equivalents  and
marketable  securities  were  in  the  aggregate  $32,586,000  and  $34,684,000,
respectively.  The decrease of $2,098,000 was attributable  primarily to the net
loss for the quarter of  $1,136,000  and the purchase of capital  equipment  and
leasehold improvements of $1,055,000.  In addition to the cash, cash equivalents
and  marketable   securities  described  above,  the  Company  had  $712,000  in
restricted cash recorded in its balance sheet at March 31, 1997. This restricted
cash is held in one of the  Company's  investment  accounts  and  secures  lease
payments to the Company's landlord for one full year and secures the outstanding
balances  due on two  equipment  leases.  At March 31,  1997,  the  Company  had
committed  approximately  $800,000 for capital costs relating to improvements in
its assay screening and data base management systems.

         To date, the Company has met its cash requirements  through the sale of
its stock,  through  licensing  fees,  research  funding and milestone  payments
received  under the  collaborative  agreements  with Lilly,  Merck and Novartis,
through SBIR grants and through interest earned on its investments.  As of March
31, 1997, the Company had received:  approximately  $62,000,000 from the sale of
its stock;  approximately  $40,500,000 in licensing fees,  research  funding and
milestone   payments  under  its   collaborative   arrangements;   approximately
$2,700,000 in SBIR grants; and approximately $5,200,000 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.

         At  March  31,  1997,   the  Company  was  involved  in   collaborative
arrangements  with Lilly,  Merck,  Novartis and Dupont Merck.  Lilly,  Merck and
Novartis are providing research funding to the Company during 1997 and Lilly and
Novartis are expected to provide  research  funding to the Company  during 1998.
The  aggregate  amount of research  funding under these  arrangements  which the
Company  expects to  receive  during the  remainder  of 1997 and during  1998 is
approximately   $6,900,000   and   $6,700,000,   respectively.   The   Company's
collaborative  arrangement  with DuPont  Merck does not provide for any research
funding. Research funding under the Lilly agreement is scheduled to expire

                                        6


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on December 31, 1998. Research funding under the Merck agreement is scheduled to
expire  on  November  30,  1997  but  Merck  has  the  right  to  terminate  the
collaboration earlier by giving 90 days' prior written notice.  Research funding
under the Novartis agreements is scheduled to expire on August 3, 1998.

         At March 31, 1997,  the Company had invested an aggregate of $6,614,000
in property and equipment.  The Company leases  laboratory and office facilities
under an agreement  expiring on December 31, 1999.  The minimum  annual  payment
under the lease is $691,000.

         At March 31, 1997 the Company had available funds of  $32,586,000.  The
Company expects to continue to incur operating  losses for a significant  number
of years. In addition, the Company continues to convert currently  underutilized
space into  laboratory  facilities  beyond the level which  existed at March 31,
1997.  The Company  believes  that its cash on hand,  together with the funds it
will receive from its collaborative partners, interest income and funds received
under SBIR grants,  will be  sufficient to fund an increased  operating  expense
level through June 30, 1999.

         This  management  discussion  and analysis of financial  condition  and
results of operations  includes "forward looking  statements" within the meaning
of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities  Exchange Act of 1934, as amended.  These forward looking  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 forward looking  statements  involve risks and  uncertainties,
including,  but not limited to, the possible early termination of one or more of
the Company's collaborative agreements, and other risks, uncertainties and other
factors set forth as "Cautionary  Statements" in the Company's  Annual Report on
Form 10-K for the year ended  December 31, 1996 or detailed from time to time in
filings that the company makes with the Securities and Exchange Commission.  The
forward  looking  statements  included herein are qualified in their entirety by
the Cautionary  Statements.  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.





















                                        7


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                           PART II. OTHER INFORMATION


Item 6.  Exhibits and Reports on Form 8-K

(a) Exhibits

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

11                Statement Regarding Computation of Per Share Earnings (Loss)

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 March 31, 1997.














































                                        8


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                                 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: May 9, 1997            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








































                                        9


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