<PAGE>   1
                                 United States
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549


                                 FORM 10-QSB/A1


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


For the quarterly period ended          JUNE 30, 1999
                               -----------------------------


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

                         Commission File Number 0-20791


                           AMARILLO BIOSCIENCES, INC.
       -----------------------------------------------------------------
       (Exact name of small business issuer as specified in its charter)

           TEXAS                                         75-1974352
------------------------------------------------------------------------
(State or other jurisdiction of                        (IRS Employer
incorporation or organization)                       Identification No.)

800 West Ninth, Amarillo, TX                                79101
------------------------------------------------------------------------
(Address of principal executive offices)                  (Zip Code)

     806-376-1741                                       FAX 806-376-9301
------------------------------------------------------------------------
(Issuer's telephone number, including area code)


         Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 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 June 30, 1999 there were 6,360,326 shares of the issuer's common stock
outstanding.



                                       1

<PAGE>   2


                           AMARILLO BIOSCIENCES, INC.


                                     INDEX



<TABLE>
<CAPTION>
PART I:              FINANCIAL INFORMATION                                                                    PAGE NO.
                                                                                                              --------
<S>                  <C>                                                                                      <C>
ITEM 1.              Financial Statements

                     Consolidated Balance Sheets - December 31, 1998 and June
                     30, 1999....................................................................                    3

                     Consolidated Statements of Operations - Three Months and
                     Six Months Ended June 30, 1998 and 1999 and Cumulative
                     from June 25, 1984 (Inception) through June 30, 1999........................                    4

                     Condensed Consolidated Statements of Cash Flows - Six
                     Months Ended June 30, 1998 and 1999 and Cumulative from
                     June 25, 1984 (Inception) through June 30, 1999.............................                    5

                     Notes to Consolidated Financial Statements..................................                    6

PART II:             OTHER INFORMATION

ITEM 6.              Exhibits and Reports on Form 8-K............................................                    7

Signatures           ............................................................................                   10
</TABLE>




                                       2

<PAGE>   3



                  AMARILLO BIOSCIENCES, INC. AND SUBSIDIARIES
                      (COMPANIES IN THE DEVELOPMENT STAGE)
                          CONSOLIDATED BALANCE SHEETS
                                  (unaudited)

<TABLE>
<CAPTION>
                                                                                    December 31,              June 30,
                                                                                        1998                    1999
                                                                                  -----------------       -----------------
<S>                                                                               <C>                     <C>
ASSETS
Current assets:
  Cash and cash equivalents                                                       $       4,776,328       $       1,869,062
  Other current assets                                                                       43,415                  32,574
                                                                                  -----------------       -----------------
Total current assets                                                                      4,819,743               1,901,636
Property and equipment, net                                                                 116,761                 114,424
Patent license, net of accumulated amortization of $81,177 and
  $84,823 at December 31, 1998 and June 30, 1999, respectively                               43,823                  40,177
Investment in ISI common stock                                                                5,735                     738
                                                                                  -----------------       -----------------
Total assets                                                                      $       4,986,062       $       2,056,975
                                                                                  =================       =================
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
  Accounts payable                                                                $          88,920       $          61,650
  Accrued interest                                                                          208,356                      --
  Other accrued liabilities                                                                  20,722                  19,086
                                                                                  -----------------       -----------------
Total current liabilities                                                                   317,998                  80,736
Notes payable to related party                                                            2,600,000                      --
                                                                                  -----------------       -----------------
Total liabilities                                                                         2,917,998                  80,736
Stockholders' equity:
  Common stock, $.01 par value:
     Authorized shares - 10,000,000
     Issued shares - 6,360,326                                                               54,142                  63,603
  Additional paid-in capital                                                             13,392,138              16,220,202
  Deficit accumulated during the development stage                                      (11,378,216)            (14,307,566)
                                                                                  -----------------       -----------------
Total stockholders' equity                                                                2,068,064               1,976,239
                                                                                  -----------------       -----------------
Total liabilities and stockholders' equity                                        $       4,986,062       $       2,056,975
                                                                                  =================       =================
</TABLE>

                            See accompanying notes.


                                       3

<PAGE>   4




                  AMARILLO BIOSCIENCES, INC. AND SUBSIDIARIES
                      (COMPANIES IN THE DEVELOPMENT STAGE)

                     CONSOLIDATED STATEMENTS OF OPERATIONS
                                  (unaudited)


<TABLE>
<CAPTION>

                                                                                                                    Cumulative
                                                                                                                       from
                                                                                                                     June 25,
                                                                                                                       1984
                                          Three months ended                       Six months ended                (Inception)
                                               June 30,                                June 30,                      through
                                 -------------------------------------  --------------------------------------       June 30,
                                         1998               1999               1998                1999                1999
                                 -------------------------------------  --------------------------------------  ------------------
<S>                              <C>                 <C>                <C>                 <C>                 <C>
Revenues:
  Contract revenues              $               --  $              --  $               --  $               --  $        9,000,000
  Interferon sales                               --                 --                  --                  --             420,974
  Interest income                            77,664             27,951             167,475              76,638           1,491,275
  Sublicense fees                                --                 --                  --                  --             113,334
  Royalty income                                 --                 --                  --                  --              31,544
  Gain on sale of ISI stock                      --                 --                  --                  --             113,972
  Other                                          --                 --                  --                  --             604,431
                                 ------------------  -----------------  ------------------  ------------------  ------------------
                                             77,664             27,951             167,475              76,638          11,775,530

Expenses:
  Research and
  development expenses                      351,894            556,355             720,411           2,237,399          13,589,843
  Selling, general, and
  administrative expenses                   260,312            415,090             558,991             739,419          11,612,139
  Interest expense                           29,250                321              58,500              29,170             846,114
                                 ------------------  -----------------  ------------------  ------------------  ------------------
                                            641,456            971,766           1,337,902           3,005,988          26,048,096
                                 ------------------  -----------------  ------------------  ------------------  ------------------

Loss before income taxes                   (563,792)          (943,815)         (1,170,427)         (2,929,350)        (14,272,566)
Income tax expense                               --                 --                  --                  --              35,000
                                 ------------------  -----------------  ------------------  ------------------  ------------------
Net loss                         $         (563,792) $        (943,815) $       (1,170,427) $       (2,929,350) $      (14,307,566)
                                 ==================  =================  ==================  ==================  ==================
Basic and diluted loss
per share                        $            (0.10) $           (0.15) $            (0.22) $            (0.50)
                                 ==================  =================  ==================  ==================
Weighted average shares
outstanding                               5,414,232          6,349,929           5,414,232           5,884,665
                                 ==================  =================  ==================  ==================
</TABLE>




                            See accompanying notes.

                                       4

<PAGE>   5


                  AMARILLO BIOSCIENCES, INC. AND SUBSIDIARIES
                      (COMPANIES IN THE DEVELOPMENT STAGE)

                CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                  (unaudited)


<TABLE>
<CAPTION>
                                                                   Six months ended                       Cumulative from
                                                                       June 30,                             June 25,1984
                                                      -------------------------------------------       (Inception) through
                                                             1998                    1999                  June 30, 1999
                                                      ------------------      -------------------     -----------------------
<S>                                                   <C>                     <C>                      <C>
Net cash used in operating activities                 $         (997,211)     $        (2,901,136)     $          (13,071,973)

Net cash used in investing activities                            556,356                   (6,130)                   (535,987)

Net cash provided by financing activities                             --                       --                  15,477,019
                                                      ------------------      -------------------      ----------------------
Net increase (decrease) in cash and cash
 equivalents                                                    (440,855)              (2,907,266)                  1,869,059

Cash and cash equivalents at beginning
 of period                                                       879,170                4,776,328                          --
                                                      ------------------      -------------------      ----------------------
Cash and cash equivalents at end of
 period                                               $          438,315     $          1,869,062      $            1,869,059
                                                      ==================     ====================      ======================
Supplemental Disclosure of Cash Flow
  Information

Cash paid for income taxes                            $               --     $                 --      $               37,084
                                                      ==================     ====================      ======================

Cash paid for interest                                $               --     $                 --      $                6,466
                                                      ==================     ====================      ======================
</TABLE>


                            See accompanying notes.


                                       5

<PAGE>   6


                  AMARILLO BIOSCIENCES, INC. AND SUBSIDIARIES
                      (COMPANIES IN THE DEVELOPMENT STAGE)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.       Basis of Presentation. The accompanying consolidated financial
         statements, which should be read in conjunction with the consolidated
         financial statements and footnotes included in the Company's Form
         10-KSB, are unaudited (except for the December 31, 1998 consolidated
         balance sheet which was derived from the Company's audited financial
         statements), but have been prepared in accordance with generally
         accepted accounting principles for interim financial information.
         Accordingly, they do not include all of the information and footnotes
         required by generally accepted accounting principles for complete
         financial statements. In the opinion of management, all adjustments
         (consisting only of normal recurring adjustments) considered necessary
         for a fair presentation have been included.

         Operating results for the six months ended June 30, 1999 are not
         necessarily indicative of the results that may be expected for the
         full year ending December 31, 1999.

2.       Loss per share. Loss per share is computed based on the weighted
         average number of common shares outstanding.

3.       Effective April 2, 1999, by agreement between the Company and
         Hayashibara Biochemical Laboratories (HBL), two promissory notes dated
         September 25, 1996 and September 16, 1997, issued by the Company to
         HBL for loans, were converted into common stock of the Company. The
         amount converted included principal of $2.6 million, and accrued
         interest at $237,526. The total number of shares of common stock of
         the Company issued to HBL in consideration for the cancellation of
         said notes was 946,094 shares, at $2.9992 per share. The share price
         was determined by the average of the high and low price weighted by
         volume for the ten trading days prior to April 2, 1999. The shares are
         "restricted stock" within the meaning of Rule 144 promulgated under
         the U.S. Securities Act of 1933, and must be held for one year before
         they can be sold under such rule.

         As a consequence of the conversion, HBL's ownership of the Company has
         increased from 22.8%, to 34.3%.




                                       6

<PAGE>   7



ITEM 6.           EXHIBITS AND REPORTS ON FORM 8-K

EXHIBIT INDEX


<TABLE>
<CAPTION>
        NUMBER    DESCRIPTION
        ------    -------------------------------------------------------------
<S>               <C>
         3.1      Restated Articles of Incorporation of the Company, dated June
                  22, 1999.

         3.3*     Bylaws of the Company.

         4.1*     Specimen Common Stock Certificate.

         4.2*     Form of Underwriter's Warrant.

        10.1*     Agreement dated as of April 1, 1984 between University
                  Patents, Inc. and the Company.

        10.2*     License Agreement dated as of March 22, 1988 between the
                  Company and The Texas A&M University System.

        10.3*     License Agreement dated October 20, 1989 between the Company
                  and ISI.

        10.4*     Manufacturing and Supply Agreement dated October 20, 1989
                  between the Company and ISI.

        10.5*     Joint Development and Manufacturing/Supply Agreement dated
                  March 13, 1992 between the Company and HBL, as amended.

        10.6*     Amended and Restated Agreement dated as of November 24, 1992
                  between Mitsubishi and the Company.

        10.7*     Japan Animal Health License Agreement dated January 20, 1993
                  between the Company and HBL.

        10.9*     Employment Agreement dated as of March 4, 1994 between the
                  Company and Dr. Joseph M. Cummins, as amended.

        10.11*    Manufacturing/Supply Agreement dated June 1, 1994 between the
                  Company and HBL.

        10.12*    Settlement Agreement dated April 27, 1995 among the Company,
                  ISI, Pharma Pacific Management Pty. Ltd. ("PPM"), Pharma
                  Pacific Pty. Ltd., Pharma Pacific Ltd., and Fernz Corporation
                  Limited.

        10.13*    Amendment of ACC/ISI License Agreement dated April 27, 1995
                  between the Company and ISI.

        10.14*    PPM/ACC Sub-license Agreement dated April 27, 1995 between
                  PPM and the Company.

        10.15*    License and Supply Agreement dated July 10, 1995 between
                  Veldona Africa, Inc. ("VAF") and Innovative Therapeutics,
                  Ltd. ("ITL").

        10.16*    Pricing Amendment, dated December 5, 1995 between VAF and
                  ITL.

        10.18*    Form of Consulting Agreement between the Company and the
                  Underwriter.

        10.19*    Research Agreement dated March 25, 1996 between the Company
                  and Ajinomoto Co., Inc.

        10.20     1996 Employee Stock Option Plan, Amended and Restated as of
                  May 11, 1999.

        10.21     Outside Director and Advisor Stock Option Plan, Amended and
                  Restated as of May 11, 1999.

        10.22*    Form of Indemnification Agreement between the Company and
                  officers and directors of the Company.
</TABLE>


                                       7

<PAGE>   8



<TABLE>
<CAPTION>
         NUMBER   DESCRIPTION
         ------   -------------------------------------------------------------
<S>               <C>
         10.23*   Indemnification Agreement between HBL and the Company.

         10.24*   Stock Purchase Agreement dated as of September 21, 1987
                  between Mesa Operating Limited Partnership and the Company.

         10.26**  License Agreement dated July 22, 1997, between Hoffmann-La
                  Roche Inc., and the Company.

         10.27**  Distribution Agreement dated January 12, 1998, between Global
                  Damon Pharmaceutical and the Company.

         10.28**  Distribution Agreement dated September 17, 1997, between HBL
                  and the Company (TNF-A).

         10.29**  Distribution Agreement dated September 17, 1997, between HBL
                  and the Company (IFN-G).

         10.30*** Amendment No. 1 dated September 28, 1998 to License Agreement
                  of March 22, 1988, between The Texas A&M University System
                  and the Company.

         10.31*** Employment Agreement dated as of November 29, 1998 between
                  the Company and Kathleen L. Kelleher.

         10.32*** Employment Agreement dated as of September 14, 1998 between
                  the Company and Dr. Philip C. Fox.

         10.33*** Employment Agreement dated as of September 14, 1998 between
                  the Company and John Smith.

         10.34*** Engagement Agreement dated as of October 15, 1998 between
                  Trust Company of the South and the Company.

         10.35(a) License Agreement dated June 16, 1999, between North China
                  Pharmaceutical Group Corporation, and the Company.

         21.      Subsidiaries of the Company. The following sets forth the
                  name and jurisdiction of incorporation of each subsidiary of
                  the Company. All of such subsidiaries are wholly-owned by the
                  Company.

               NAME                               JURISDICTION OF INCORPORATION
               -----------------------------      -----------------------------
               VANGUARD BIOSCIENCES, INC.         TEXAS
               VELDONA USA, INC.                  TEXAS
               VELDONA AFRICA, INC.               TEXAS
               VELDONA POLAND, INC.               TEXAS
               ABI TAIWAN, INC.                   TEXAS
               AMARILLO CELL OF CANADA, INC.      TEXAS

         27.      Financial Data Schedule
</TABLE>


*The Exhibit is incorporated by reference to the exhibit of the same number to
the Company's Registration Statement on Form SB-2 filed with and declared
effective by the Commission (File No. 333-4413) on August 8, 1996.

**The Exhibit is incorporated by reference to the Company's 1997 Annual Report
on Form 10-KSB filed with the Commission on or before March 31, 1998.

***The Exhibit is incorporated by reference to the Company's 1998 Annual Report
on Form 10-KSB filed with the Commission on or before March 31, 1999.

(a) Portions of this exhibit have been omitted and filed separately with the
Commission.


                                       8

<PAGE>   9


REPORTS ON FORM 8-K

The Company filed a report on Form 8-K on April 2, 1999. The item reported was
the conversion by Hayashibara Biochemical Laboratories, Inc. ("HBL") of debt
held by it in the amount of $2,837,526, to 946,094 shares of the Company's
common stock. Further information on this conversion is detailed at Note 3 to
the Consolidated Financial Statements contained in Part I of this report.



                                       9

<PAGE>   10




                                   SIGNATURES





         Pursuant to the requirements of Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.



                                      AMARILLO BIOSCIENCES, INC.


Date:    10 SEP 99                    By: /s/ JOSEPH M. CUMMINS
     -----------------                   ----------------------------------
                                         Joseph M. Cummins
                                         President, Chief Executive Officer
                                         and Chief Financial Officer




                                       10

<PAGE>   11
                                EXHIBIT INDEX

<TABLE>
<CAPTION>
        NUMBER    DESCRIPTION
        ------    -------------------------------------------------------------
<S>               <C>
         3.1      Restated Articles of Incorporation of the Company, dated June
                  22, 1999.

         3.3*     Bylaws of the Company.

         4.1*     Specimen Common Stock Certificate.

         4.2*     Form of Underwriter's Warrant.

         10.1*    Agreement dated as of April 1, 1984 between University
                  Patents, Inc. and the Company.

         10.2*    License Agreement dated as of March 22, 1988 between the
                  Company and The Texas A&M University System.

         10.3*    License Agreement dated October 20, 1989 between the Company
                  and ISI.

         10.4*    Manufacturing and Supply Agreement dated October 20, 1989
                  between the Company and ISI.

         10.5*    Joint Development and Manufacturing/Supply Agreement dated
                  March 13, 1992 between the Company and HBL, as amended.

         10.6*    Amended and Restated Agreement dated as of November 24, 1992
                  between Mitsubishi and the Company.

         10.7*    Japan Animal Health License Agreement dated January 20, 1993
                  between the Company and HBL.

         10.9*    Employment Agreement dated as of March 4, 1994 between the
                  Company and Dr. Joseph M. Cummins, as amended.

         10.11*   Manufacturing/Supply Agreement dated June 1, 1994 between the
                  Company and HBL.

         10.12*   Settlement Agreement dated April 27, 1995 among the Company,
                  ISI, Pharma Pacific Management Pty. Ltd. ("PPM"), Pharma
                  Pacific Pty. Ltd., Pharma Pacific Ltd., and Fernz Corporation
                  Limited.

         10.13*   Amendment of ACC/ISI License Agreement dated April 27, 1995
                  between the Company and ISI.

         10.14*   PPM/ACC Sub-license Agreement dated April 27, 1995 between
                  PPM and the Company.

         10.15*   License and Supply Agreement dated July 10, 1995 between
                  Veldona Africa, Inc. ("VAF") and Innovative Therapeutics,
                  Ltd. ("ITL").

         10.16*   Pricing Amendment, dated December 5, 1995 between VAF and
                  ITL.

         10.18*   Form of Consulting Agreement between the Company and the
                  Underwriter.

         10.19*   Research Agreement dated March 25, 1996 between the Company
                  and Ajinomoto Co., Inc.

         10.20    1996 Employee Stock Option Plan, Amended and Restated as of
                  May 11, 1999.

         10.21    Outside Director and Advisor Stock Option Plan, Amended and
                  Restated as of May 11, 1999.

         10.22*   Form of Indemnification Agreement between the Company and
                  officers and directors of the Company.

         10.23*   Indemnification Agreement between HBL and the Company.

         10.24*   Stock Purchase Agreement dated as of September 21, 1987
                  between Mesa Operating Limited Partnership and the Company.

         10.26**  License Agreement dated July 22, 1997, between Hoffmann-La
                  Roche Inc., and the Company.
</TABLE>


<PAGE>   12
<TABLE>
<S>               <C>
         10.27**  Distribution Agreement dated January 12, 1998, between Global
                  Damon Pharmaceutical and the Company.

         10.28**  Distribution Agreement dated September 17, 1997, between HBL
                  and the Company (TNF-A).

         10.29**  Distribution Agreement dated September 17, 1997, between HBL
                  and the Company (IFN-G).

         10.30*** Amendment No. 1 dated September 28, 1998 to License Agreement
                  of March 22, 1988, between The Texas A&M University System
                  and the Company.

         10.31*** Employment Agreement dated as of November 29, 1998 between
                  the Company and Kathleen L. Kelleher.

         10.32*** Employment Agreement dated as of September 14, 1998 between
                  the Company and Dr. Philip C. Fox.

         10.33*** Employment Agreement dated as of September 14, 1998 between
                  the Company and John Smith.

         10.34*** Engagement Agreement dated as of October 15, 1998 between
                  Trust Company of the South and the Company.

         10.35(a) License Agreement dated June 16, 1999, between North China
                  Pharmaceutical Group Corporation, and the Company.

         21.      Subsidiaries of the Company. The following sets forth the
                  name and jurisdiction of incorporation of each subsidiary of
                  the Company. All of such subsidiaries are wholly-owned by the
                  Company.

            NAME                                  JURISDICTION OF INCORPORATION
            --------------------------            -----------------------------
            VANGUARD BIOSCIENCES, INC.            TEXAS
            VELDONA USA, INC.                     TEXAS
            VELDONA AFRICA, INC.                  TEXAS
            VELDONA POLAND, INC.                  TEXAS
            ABI TAIWAN, INC.                      TEXAS
            AMARILLO CELL OF CANADA, INC.         TEXAS

         27.      Financial Data Schedule
</TABLE>

*The Exhibit is incorporated by reference to the exhibit of the same number to
the Company's Registration Statement on Form SB-2 filed with and declared
effective by the Commission (File No. 333-4413) on August 8, 1996.

**The Exhibit is incorporated by reference to the Company's 1997 Annual Report
on Form 10-KSB filed with the Commission on or before March 31, 1998.

***The Exhibit is incorporated by reference to the Company's 1998 Annual Report
on Form 10-KSB filed with the Commission on or before March 31, 1999.

(a) Portions of this exhibit have been omitted and filed separately with the
Commission.