<PAGE>   1
 
================================================================================
 
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
 
                            ------------------------
 
                                   FORM 10-Q
 
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
                                  ACT OF 1934
 
                    FOR THE QUARTER ENDED SEPTEMBER 30, 1997
 
                         COMMISSION FILE NUMBER 0-21481
 
                         TRANSKARYOTIC THERAPIES, INC.
             (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
 
                            ------------------------
 
<TABLE>
<S>                                            <C>
                   DELAWARE                                      04-3027191
       (STATE OR OTHER JURISDICTION OF                        (I.R.S. EMPLOYER
        INCORPORATION OR ORGANIZATION)                      IDENTIFICATION NO.)
 
              195 ALBANY STREET
           CAMBRIDGE, MASSACHUSETTS                                02139
   (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)                      (ZIP CODE)
</TABLE>
 
       Registrant's telephone number, including area code: (617) 349-0200
 
                            ------------------------
 
     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  [ ]
 
     At October 31, 1997, there were 18,413,086 shares of Common Stock, $.01 par
value, issued and outstanding.
================================================================================
<PAGE>   2
 
                         TRANSKARYOTIC THERAPIES, INC.
 
                                     INDEX
 
<TABLE>
<CAPTION>
                                                                                        PAGE
                                                                                       NUMBER
                                                                                       ------
<S>        <C>                                                                         <C>
PART I.    FINANCIAL INFORMATION
 
Item 1.    Condensed Financial Statements (unaudited)..............................      3-7
           Condensed Balance Sheets as of September 30, 1997 and December 31,
             1996..................................................................        3
           Condensed Statements of Operations for the Three and Nine Months Ended
             September 30, 1997 and 1996...........................................        4
           Condensed Statements of Cash Flows for the Nine Months Ended September
             30, 1997 and 1996.....................................................        5
           Notes to Condensed Financial Statements.................................      6-7
Item 2.    Management's Discussion and Analysis of Financial Condition and Results
             of Operations.........................................................     8-10
 
PART II.   OTHER INFORMATION
 
Item 3.    Changes in Securities and Use of Proceeds...............................    11-12
Item 6.    Exhibits and Reports on Form 8-K........................................       12
 
SIGNATURES.........................................................................       13
 
EXHIBIT INDEX......................................................................       14
</TABLE>
 
                                        2
<PAGE>   3
 
                        PART I -- FINANCIAL INFORMATION
 
ITEM 1.  CONDENSED FINANCIAL STATEMENTS
 
                         TRANSKARYOTIC THERAPIES, INC.
 
                            CONDENSED BALANCE SHEETS
                                  (UNAUDITED)
 
<TABLE>
<CAPTION>
                                                                     SEPTEMBER 30,     DECEMBER 31,
                                                                         1997              1996
                                                                     -------------     ------------
                                                                             (IN THOUSANDS)
<S>                                                                  <C>               <C>
ASSETS
Current assets:
  Cash and cash equivalents........................................    $  10,209         $ 10,414
  Marketable securities............................................      123,227           75,841
  Prepaid expenses and other current assets........................          417              818
                                                                        --------          -------
          Total current assets.....................................      133,853           87,073
Property and equipment, net........................................        3,662            3,237
Other assets.......................................................          735              688
                                                                        --------          -------
                                                                       $ 138,250         $ 90,998
                                                                        ========          =======
 
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
  Accounts payable.................................................    $     757         $    612
  Accrued expenses.................................................        1,324              652
                                                                        --------          -------
          Total current liabilities................................        2,081            1,264
Other long-term liabilities........................................           23               90
Stockholders' equity:
  Preferred stock, $1.00 par value, 10,000,000 shares authorized;
     no shares issued and outstanding..............................           --               --
  Common stock, $.01 par value; 30,000,000 shares authorized;
     18,411,489 shares issued and outstanding at September 30, 1997
     (16,614,273 at December 31, 1996).............................          184              166
  Additional paid-in capital.......................................      184,594          131,796
  Accumulated deficit..............................................      (44,604)         (37,116)
  Deferred compensation............................................       (4,060)          (5,218)
  Unrealized gain on marketable securities.........................           32               16
                                                                        --------          -------
          Total stockholders' equity...............................      136,146           89,644
                                                                        --------          -------
                                                                       $ 138,250         $ 90,998
                                                                        ========          =======
</TABLE>
 
           See accompanying Notes to Condensed Financial Statements.
 
                                        3
<PAGE>   4
 
                         TRANSKARYOTIC THERAPIES, INC.
 
                       CONDENSED STATEMENTS OF OPERATIONS
                                  (UNAUDITED)
 
<TABLE>
<CAPTION>
                                                     THREE MONTHS ENDED       NINE MONTHS ENDED
                                                        SEPTEMBER 30,           SEPTEMBER 30,
                                                     -------------------     --------------------
                                                      1997        1996         1997        1996
                                                     -------     -------     --------     -------
                                                        (IN THOUSANDS, EXCEPT PER SHARE DATA)
<S>                                                  <C>         <C>         <C>          <C>
License and research revenues......................  $   300     $ 1,975     $  5,513     $ 3,950
Operating expenses:
  Research and development.........................    4,498       3,811       12,523      10,791
  General and administrative.......................    1,480       1,227        4,388       2,997
                                                     -------     -------     --------     -------
                                                       5,978       5,038       16,911      13,788
                                                     -------     -------     --------     -------
Loss from operations...............................   (5,678)     (3,063)     (11,398)     (9,838)
Interest income....................................    1,657         646        3,910       1,434
                                                     -------     -------     --------     -------
Net loss...........................................  $(4,021)    $(2,417)    $ (7,488)    $(8,404)
                                                     =======     =======     ========     =======
Net loss per share (pro forma in 1996).............  $ (0.23)    $ (0.17)    $  (0.44)    $ (0.59)
                                                     =======     =======     ========     =======
Shares used to compute net loss per share (pro
  forma in 1996)...................................   17,838      14,255       17,050      14,255
                                                     =======     =======     ========     =======
</TABLE>
 
           See accompanying Notes to Condensed Financial Statements.
 
                                        4
<PAGE>   5
 
                         TRANSKARYOTIC THERAPIES, INC.
 
                       CONDENSED STATEMENTS OF CASH FLOWS
                                  (UNAUDITED)
 
<TABLE>
<CAPTION>
                                                                          NINE MONTHS ENDED
                                                                            SEPTEMBER 30,
                                                                        ----------------------
                                                                          1997          1996
                                                                        ---------     --------
                                                                            (IN THOUSANDS)
<S>                                                                     <C>           <C>
OPERATING ACTIVITIES:
Net loss..............................................................  $  (7,488)    $ (8,404)
Adjustments to reconcile net loss to net cash used for operating
  activities:
  Depreciation and amortization.......................................      1,321        1,183
  Compensation expense related to equity issuances....................        868          803
Changes in operating assets and liabilities...........................      1,151          258
                                                                        ---------     --------
Net cash used for operating activities................................     (4,148)      (6,160)
                                                                        ---------     --------
 
INVESTING ACTIVITIES:
Proceeds from sales of marketable securities..........................     61,264       42,745
Purchases of marketable securities....................................   (108,634)     (59,002)
Purchases of property and equipment...................................     (1,609)        (676)
Changes in other assets...............................................       (184)        (567)
                                                                        ---------     --------
Net cash used for investing activities................................    (49,163)     (17,500)
                                                                        ---------     --------
 
FINANCING ACTIVITIES:
Proceeds from sale  of common stock and exercise
  of stock options and warrants, net of expenses......................     53,106           --
Proceeds from sale of convertible preferred stock.....................         --       23,522
                                                                        ---------     --------
Net cash provided by financing activities.............................     53,106       23,522
                                                                        ---------     --------
Net decrease in cash and cash equivalents.............................       (205)        (138)
Cash and cash equivalents at January 1................................     10,414       11,539
                                                                        ---------     --------
Cash and cash equivalents at September 30.............................  $  10,209     $ 11,401
                                                                        =========     ========
</TABLE>
 
           See accompanying Notes to Condensed Financial Statements.
 
                                        5
<PAGE>   6
 
                         TRANSKARYOTIC THERAPIES, INC.
 
                    NOTES TO CONDENSED FINANCIAL STATEMENTS
                          SEPTEMBER 30, 1997 AND 1996
                                  (UNAUDITED)

1.  NATURE OF BUSINESS AND BASIS OF PRESENTATION
 
     Transkaryotic Therapies, Inc. ("TKT" or the "Company" ) is a
biopharmaceutical company engaged in the development and commercialization of
therapeutic proteins and gene therapy products for the long-term treatment and
cure of a broad range of human diseases.
 
     The accompanying unaudited condensed financial statements have been
prepared in accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-Q and Article 10 of
Regulation S-X. Accordingly, they do not include all of the information and
footnotes required by generally accepted accounting principles for complete
financial statements. In the opinion of management, the accompanying financial
statements include all adjustments, consisting of normal recurring accruals,
necessary for a fair presentation of the financial condition, results of
operations and cash flows for the periods presented. The results of operations
for the interim period ended September 30, 1997 are not necessarily indicative
of the results to be expected for the year ended December 31, 1997.
 
     These financial statements should be read in conjunction with the audited
financial statements and notes thereto for the year ended December 31, 1996
included in the Company's Annual Report on Form 10-K filed with the Securities
and Exchange Commission.
 
     Certain reclassifications have been made to the 1996 financial statements
to conform to the 1997 presentation.
 
2.  NET LOSS PER SHARE
 
     Net loss per share is computed using the weighted average number of shares
of common stock, and common equivalent shares are excluded as their effect is
antidilutive. For the three and nine months ended September 30, 1996, the
weighted average number of shares also includes the common stock equivalents for
convertible preferred shares, assuming conversion at date of issuance, which
occurred upon the completion of the Company's initial public offering of common
stock in October 1996. Pursuant to the requirements of the Securities and
Exchange Commission, shares and equivalent shares issued by the Company during
the twelve-month period prior to the public offering have been included in the
calculations as if they were outstanding for all periods prior to the initial
public offering whether or not they are anti-dilutive, using the treasury stock
method.
 
     In February 1997, the Financial Accounting Standards Board issued Statement
of Financial Accounting Standard No. 128, "Earnings Per Share" ("Statement
128"), which is required to be adopted on December 31, 1997. At that time, the
Company will be required to change the method currently used to compute earnings
(loss) per share and to restate all prior periods. Under the new requirements
for calculating basic earnings (loss) per share, the dilutive effect of stock
options will be excluded. The impact is not expected to result in a change in
basic loss per share for the three and nine months ended September 30, 1997 or
in the pro forma basic loss per share for the three and nine months ended
September 30, 1996.
 
3.  STOCKHOLDERS' EQUITY
 
     On August 4, 1997, the Company completed a directed public offering of
1,700,000 shares of common stock to a small number of accredited institutional
investors, resulting in net proceeds to the Company of approximately
$52,893,000.
 
                                        6
<PAGE>   7
 
                         TRANSKARYOTIC THERAPIES, INC.
 
             NOTES TO CONDENSED FINANCIAL STATEMENTS -- (CONTINUED)
 
4.  RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS
 
     In June 1997, the Financial Accounting Standards Board issued Statement No.
130, "Reporting Comprehensive Income", which is required to be adopted for
fiscal years beginning after December 15, 1997. The Statement establishes
standards for the reporting and display of comprehensive income and its
components in a full set of general purpose financial statements.
 
     Also, in June 1997, the Financial Accounting Standards Board issued
Statement No. 131, "Disclosures about Segments of an Enterprise and Related
Information", which is required to be adopted for fiscal years beginning after
December 15, 1997. The Statement changes the way in which public companies
report segment information in annual financial statements and also requires
those companies to report selected segment information in interim financial
reports to shareholders.
 
     Adoption of these standards is not expected to have a material impact on
the Company's financial statements or results of operations.
 
5.  LEGAL PROCEEDINGS
 
     In April 1997, Amgen Inc. filed a civil action in the U.S. District Court
in Massachusetts against the Company and Hoechst Marion Roussel, Inc. ("HMRI"),
its collaborative partner. The complaint in the action alleges that the
Company's product, Gene Activated erythropoetin ("GA-EPO"), and processes for
producing GA-EPO infringe three Amgen patents and requests that TKT and HMRI be
enjoined from making, using or selling GA-EPO and that the court award Amgen
monetary damages. In May 1997, TKT and HMRI filed a "Motion To Dismiss, Or, In
The Alternative, For Summary Judgment" stating that under 35 U.S.C. sec.
271(e)(1), TKT's and HMRI's activities do not constitute infringement and
further stating that "neither the product created by TKT nor the process used by
TKT and HMR infringes any valid claim of any of the Amgen patents in suit." In
July 1997, the court denied TKT's and HMRI's motion and stated that the motion
should instead be filed as a Motion for Summary Judgment.
 
     Pursuant to the Amended and Restated License Agreement, dated March 1,
1995, by and between HMRI and TKT, HMRI has assumed the cost of defense of the
suit by Amgen. TKT will reimburse HMRI for its share of litigation expenses, as
defined, from future royalties received from the sale of GA-EPO. The Company and
HMRI believe that they have substantial defenses to the allegations in the
complaint and expect that their position will be thoroughly vindicated in court.
Nonetheless, the Company can provide no assurance as to the outcome of this
litigation. A decision by the court in Amgen's favor, including the issuance of
an injunction against the manufacture and sale of GA-EPO by the Company and HMRI
in the United States, or any other conclusion of this litigation in a manner
adverse to the Company and HMRI, could have a material adverse effect on the
Company's business, financial condition and results of operations.
 
                                        7
<PAGE>   8
 
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS
 
OVERVIEW
 
     Since its inception in 1988, Transkaryotic Therapies, Inc. (the "Company")
has been primarily engaged in the development and commercialization of products
based on the Company's proprietary Gene Activation and gene therapy
technologies. No revenues have been derived from the sale of any products, and
the Company does not expect to receive revenues from product sales for a number
of years. The Company expects that its research and development expenditures
will increase substantially in future years as research and product development
efforts accelerate and clinical trials are broadened or initiated. With the
exception of 1995, the Company has incurred substantial annual operating losses
since inception and expects to incur substantial operating losses in the future.
At September 30, 1997, the Company's accumulated deficit was $44,604,000. As a
result, the Company is dependent upon existing cash resources, external
financing from equity and debt offerings or collaborative research and
development arrangements with corporate sponsors to finance its operations.
 
     Results of operations may vary significantly from period to period
depending on, among other factors, the progress of the Company's research and
development efforts, the receipt, if any, of additional license fees and
milestone payments, the timing of certain expenses, and the establishment of
additional collaborative research agreements.
 
     The following discussion of the financial condition and results of
operations of the Company should be read in conjunction with the accompanying
financial statements and the related footnotes thereto.
 
RESULTS OF OPERATIONS
 
  For the Three Months Ended September 30, 1997 and 1996
 
     License and research revenues totaled $300,000 and $1,975,000 for the three
months ended September 30, 1997 and 1996, respectively. All revenues were earned
from two collaborative agreements with Hoechst Marion Roussel, Inc. ("HMRI").
The decrease of $1,675,000 in 1997 is principally due to $1,500,000 received by
the Company pursuant to the final of four scheduled research and development
funding payments in September 1996 relating to the Company's second Gene
Activation collaboration with HMRI.
 
     Research and development expenses totaled $4,498,000 for the three months
ended September 30, 1997, as compared to $3,811,000 during the same period in
1996. The increase in 1997 of $687,000, or 18%, is principally due to increases
in research and development staff, an increase in facilities costs for
additional leased space, and an increase in external research costs. During
1997, the Company expanded primarily its Gene Activation programs.
 
     General and administrative expenses were $1,480,000 in the three months
ended September 30, 1997, compared with $1,227,000 during the same period in
1996. The increase in 1997 of $253,000, or 21%, is principally due to increases
in outside professional service fees associated with being a public company, and
increases in insurance costs.
 
     Interest income was $1,657,000 and $646,000 for the three months ended
September 30, 1997 and 1996, respectively. The average cash and marketable
securities balances were $108,875,000 and $43,828,000 in the 1997 and 1996
periods, respectively. The increase in interest income of $1,011,000, or 157%,
is primarily attributable to higher average balances in the respective three
months ended September 30, 1997.
 
     The Company had a net loss of $4,021,000 and $2,417,000 for the three
months ended September 30, 1997 and 1996, respectively. Net loss per share was
$0.23 for the three months ended September 30, 1997, as compared to a pro forma
net loss per share of $0.17 in 1996. Weighted average common and common
equivalent shares outstanding were 17,838,000 for the three months ended
September 30, 1997, as compared to 14,255,000 for the comparable period in 1996.
The increase in 1997 is due principally to the issuance of 2,500,000 shares of
common stock in the Company's initial public offering in October 1996, as well
as the
 
                                        8
<PAGE>   9
 
weighted average effect of the issuance of 1,700,000 shares of common stock
related to the Company's directed public offering in August 1997.
 
  For the Nine Months Ended September 30, 1997 and 1996
 
     License and research revenues totaled $5,513,000 and $3,950,000 for the
nine months ended September 30, 1997 and 1996, respectively. All revenues were
earned from two collaborative agreements with HMRI. The increase of $1,563,000
in 1997 is principally due to $4,500,000 received in milestone payments from
HMRI in excess of milestone payments and research and development funding
received in the comparable period in 1996.
 
     Research and development expenses totaled $12,523,000 in the first nine
months of 1997, as compared to $10,791,000 during the same period in 1996. The
increase in 1997 of $1,732,000, or 16%, is principally due to an increase in
research and development staff, an increase in facilities costs for additional
leased space, increases in consulting services, and increases in external
research costs. During 1997, the Company expanded primarily its Gene Activation
programs.
 
     General and administrative expenses were $4,388,000 in the nine months
ended September 30, 1997, compared with $2,997,000 during the same period in
1996. The increase in 1997 of $1,391,000, or 46%, is principally due to
increases in outside professional service fees associated with being a public
company, as well as increases in administrative employee costs, including
several additions in administrative personnel, and increases in insurance costs.
 
     Interest income was $3,910,000 and $1,434,000 for the nine months ended
September 30, 1997 and 1996, respectively. The average cash and marketable
securities balances were $96,762,000 and $36,700,000 in 1997 and 1996,
respectively. The increase in interest income of $2,476,000, or 173%, is
primarily attributable to higher average balances in the respective nine month
periods.
 
     The Company had a net loss of $7,488,000 and $8,404,000 for the nine months
ended September 30, 1997 and 1996, respectively. Net loss per share was $0.44
for the nine months ended September 30, 1997, as compared to a pro forma net
loss per share of $0.59 for the corresponding period in 1996. Weighted average
common shares and pro forma common shares outstanding were 17,050,000 and
14,255,000, respectively, for the nine months ended September 30, 1997 and 1996.
The increase in 1997 is related principally to the Company's initial public
offering of 2,500,000 shares of common stock in October 1996 as well as the
weighted average effect of 1,700,000 shares of common stock issued in connection
with the Company's directed public offering in August 1997.
 
LIQUIDITY AND SOURCES OF CAPITAL
 
     Since its inception, the Company has financed its operations through the
sale of common and preferred stock, revenues from collaborative agreements and
interest income.
 
     During the nine months ended September 30, 1997, the Company received
proceeds of approximately $53,106,000 from the sale of common stock in a
directed public offering in August 1997 and the exercise of stock options and
warrants. The Company expended $4,148,000 in operating activities and $1,609,000
for capital expenditures.
 
     At September 30, 1997, the Company had unrestricted cash, cash equivalents
and marketable securities totaling $133,436,000. Cash equivalents and marketable
securities are invested in U.S. Treasury notes, agencies of the U.S. government
and money market funds.
 
     Substantial additional funds will be required to support the Company's
research and development programs, for acquisition of technologies and
intellectual property rights, for preclinical and clinical testing of its
products, pursuit of regulatory approvals, acquisition of capital equipment,
expansion of laboratory and office facilities, establishment of production
capabilities and for general and administrative expenses. Until the Company's
operations generate significant revenues from product sales, cash reserves and
interest thereon and
 
                                        9
<PAGE>   10
 
proceeds from equity and debt offerings and funding from collaborative
arrangements will be used to fund operations.
 
     The Company expects to pursue opportunities to obtain additional financing
in the future through equity and debt financings, lease arrangements related to
capital equipment and collaborative research agreements. The source, timing and
availability of any future financing will depend principally upon financial
market conditions, interest rates and, more specifically, on the Company's
continued progress in its exploratory, preclinical and clinical development
programs. There can be no assurance that such funds will be available on
favorable terms, if at all.
 
     The Company expects that its existing capital resources, together with
revenues from collaborative agreements and interest income, will be sufficient
to fund its operations through 2001. The Company's cash requirements may vary,
however, depending on numerous factors. Lack of necessary funds may require the
Company to delay, scale back or eliminate some or all of its research and
product development programs or to license its potential products or
technologies to third parties.
 
     The Company is engaged in litigation with Amgen Inc. with respect to the
development of GA-EPO. See Note 4 to Notes to Condensed Financial Statements,
which is incorporated by reference herein.
 
FORWARD LOOKING STATEMENTS
 
     This Quarterly Report on Form 10-Q contains forward-looking statements. For
this purpose, any statements contained herein that are not statements of
historical fact may be deemed to be forward-looking statements. Without limiting
the foregoing, the words "believes," "anticipates," "plans," "expects,"
"intends," and similar expressions are intended to identify forward-looking
statements. There are a number of important factors that could cause the
Company's actual results to differ materially from those indicated by such
forward-looking statements. These factors include, without limitation, those set
forth in Exhibit 99 to this Quarterly Report on Form 10-Q.
 
                                       10




<PAGE>   11
                          PART II -- OTHER INFORMATION
 
ITEM 3.  CHANGES IN SECURITIES AND USE OF PROCEEDS
 
     (d) The following information is provided pursuant to Rule 463 under the
Securities Act of 1933, as amended (the "Securities Act"), with respect to the
Company's first registration statement filed pursuant to the Securities Act:
 
<TABLE>
<S>                               <C>
Effective date of the
  Registration Statement:         October 16, 1996
Securities and Exchange
  Commission file number:         333-10845
Date offering commenced:          October 16, 1996
Has offering terminated:          Yes
Managing underwriters:            Morgan Stanley & Co. Incorporated,
                                  UBS Securities LLC and
                                  Pacific Growth Equities, Inc.
Title of securities
  registered:                     Common Stock, $.01 par value per share
</TABLE>
 
     All shares of Common Stock were sold on behalf of the Company.
 
<TABLE>
<S>                               <C>
Amount of shares registered:                                            2,500,000
Aggregate offering price of
  amount sold to date:                                                $37,500,000
</TABLE>
 
                                        11
<PAGE>   12
 
     Amount of expenses incurred for the Company's account in connection with
the issuance and distribution of the securities registered for each of the
following:
 
<TABLE>
<S>                                                                   <C>
Underwriting discounts and
  commissions:                                                         $2,625,000
Finders fees:                                                                  --
Expenses paid to or for
  Underwriters:                                                           $53,000
Other expenses:                                                          $711,419
Total expenses:                                                        $3,389,419
</TABLE>
 
     All such payments were direct or indirect payments to individuals or
entities other than directors, officers, general partners of the Company or
their associates; persons owning 10 per cent or more of any class of equity
securities of the issuer; or affiliates of the Company.
 
<TABLE>
        <S>                                                            <C>
        Net offering proceeds to the Company after deducting total
          expenses:                                                    $34,110,581
</TABLE>
 
     Set forth below is the amount of net offering proceeds to the Company used
for each of the following:
 
<TABLE>
<S>                                                                 <C>
Construction of plant,
  building and facilities:                                                     --
Purchase and installation of
  machinery and equipment:
Purchases of real estate:                                                      --
Acquisition of other
  businesses:                                                                  --
Repayment of indebtedness:                                                     --
Working capital:                                                               --
Temporary investments:                                                $34,110,581
</TABLE>
 
     Any other purposes for which at least the lessor of 5% of the issuer's
total offering proceeds or $100,000 has been used:
 
     All such payments were direct or indirect payments to individuals or
entities other than directors, officers, general partners of the Company or
their associates; persons owning 10 per cent or more of any class of equity
securities of the issuer; or affiliates of the Company. Such payments did not
represent a material change in the use of proceeds described in the prospectus
contained in the Registration Statement.
 
ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K
 
     (a) Exhibits
 
          The Exhibits filed as part of this Form 10-Q are listed on the Exhibit
     Index immediately preceding such Exhibits, which Exhibit Index is
     incorporated herein by reference.
 
     (b) Reports on Form 8-K
 
          No reports were filed on Form 8-K during the three months ended
     September 30, 1997.
 
                                       12
<PAGE>   13
 
                                   SIGNATURES
 
     Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
 
                                          TRANSKARYOTIC THERAPIES, INC.
 
                                          By:     /s/ DANIEL E. GEFFKEN
                                            ------------------------------------
                                            Daniel E. Geffken
                                            Vice President, Finance and
                                            Chief Financial Officer (Principal
                                            Financial and Accounting Officer)
 
Date: November 12, 1997
 
                                       13
<PAGE>   14
 
                         TRANSKARYOTIC THERAPIES, INC.
 
                                 EXHIBIT INDEX
 
<TABLE>
<CAPTION>
EXHIBIT
  NO.                                          DESCRIPTION
-------   -------------------------------------------------------------------------------------
<C>       <S>
   11     Statement Re: Computation of Loss Per Share
   27     Financial Data Schedule
   99     Important Factors Regarding Forward-looking Statements
</TABLE>
 
                                       14