SECURITIES AND EXCHANGE COMMISSION
                                 Washington, DC

                                    Form 10-Q

(Mark One)

X        Quarterly Report Pursuant to Section 13 or 15(d) of the Securities
         Exchange Act of 1934

                  For the quarterly period ended June 30, 1998

                                       or

_____Transition Report Pursuant to Section 13 or 15(d) of the Securities
         Exchange Act of 1934

        For the transition period from _____________ to ________________

                         Commission File Number: 0-28748

                           CLOSURE MEDICAL CORPORATION
                              ---------------------
             (Exact name of registrant as specified in its charter)


 
          Delaware                                   56-1959623
----------------------------                     ------------------ 
(State or other jurisdiction                      (I.R.S. Employer  
     of incorporation or                         Identification No.)
        organization)


              5250 Greens Dairy Road, Raleigh, North Carolina 27616
             ------------------------------------------------------ 
               (Address of principal executive offices) (Zip Code)

                                 (919) 876-7800
                              --------------------
             (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____        

         Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date.



        Class                                     Outstanding at August 3, 1998
        -----                                     ------------------------------
Common Stock, par value $0.01 per share                               13,277,978



<PAGE>



                           CLOSURE MEDICAL CORPORATION

                                      INDEX

<TABLE>
<CAPTION>
<S> <C>   
                                                                                                           Page Number
                                                                                                           -----------

PART I:      FINANCIAL INFORMATION

         Item 1.  Financial Statements
 
             Balance Sheet as of June 30, 1998 (unaudited) and December 31, 1997..................................3


             Statement of Operations (unaudited) for the three months ended June 30,
                1998 and 1997 and for the six months ended June 30, 1998 and 1997.................................4

             Statement of Cash Flows (unaudited) for the six months ended June 30,
                1998 and 1997.....................................................................................5

             Notes to Financial Statements (unaudited)............................................................6

         Item 2.  Management's Discussion and Analysis of Financial Condition and
             Results of Operations................................................................................8

PART II:     OTHER INFORMATION

         Item 2.  Changes in Securities and Use of Proceeds......................................................11

         Item 4.  Submission of Matters to a Vote of Security Holders............................................12

         Item 6.  Exhibits and Reports on Form 8-K...............................................................12

</TABLE>

                                       2

<PAGE>



                          PART 1. FINANCIAL INFORMATION

Item 1.  Financial Statements

                           Closure Medical Corporation
                                  Balance Sheet
                      (In thousands, except per share data)

<TABLE>
<S> <C>

                                                                                June 30,            December 31,
                                                                                  1998                  1997
                                                                                  ----                  ----
                                 Assets                                        (Unaudited)
Current assets:
Cash and cash equivalents                                                       $    3,260             $   7,277
Short-term investments                                                              10,429                14,417
Accounts receivable                                                                    858                 1,226
Inventories                                                                            595                   347
Prepaid expenses                                                                       294                   367
                                                                                ----------            ----------
   Total current assets                                                             15,436                23,634

Furniture, fixtures and equipment, net                                               6,376                 3,694
Restricted investments                                                               1,560                 1,517
Long-term investments                                                                3,448                 1,298
Intangible assets, net                                                                 435                   276
                                                                                ----------            ----------
   Total assets                                                                 $   27,255            $   30,419
                                                                                ==========            ==========

                       Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable                                                                $      826            $      478
Accrued expenses                                                                     1,368                 2,598
Deferred revenue                                                                     2,346                 2,019
Capital lease obligations                                                               44                   155
Current portion of long-term debt                                                      350                   350
                                                                                ----------           -----------
   Total current liabilities                                                         4,934                 5,600

Capital lease obligations                                                            1,250                 1,250
Long-term debt less current portion                                                  2,600                 1,150
                                                                                ----------           -----------
   Total liabilities                                                                 8,784                 8,000
                                                                                ----------           -----------
Stockholders' Equity:
Preferred Stock, $.01 par value.  Authorized 2,000 shares; none                          -                     -
issued or outstanding
Common Stock, $.01 par value.  Authorized 35,000 shares;
issued and outstanding 13,273 and 13,242 shares, respectively                          133                   132
Additional paid-in capital                                                          46,234                46,058
Accumulated deficit                                                                (27,351)              (23,075)
Deferred compensation on stock options                                                (545)                 (696)
                                                                                ----------           -----------
   Total stockholders' equity                                                       18,471                22,419
                                                                                ----------           -----------
   Total liabilities and stockholders' equity                                   $   27,255           $    30,419
                                                                                ==========           ===========



   The accompanying notes are an integral part of these financial statements.

</TABLE>

                                       3
<PAGE>


                           Closure Medical Corporation
                             Statement of Operations
                                  (unaudited)
                      (In thousands, except per share data)


<TABLE>
<S> <C> 

                                                                 Three Months Ended        Six Months Ended
                                                                June 30,     June 30,    June 30,     June 30,
                                                                  1998         1997        1998         1997
                                                                  ----         ----        ----         ---- 
Product sales                                                  $  1,342    $    140     $  2,112     $   348
Cost of products sold                                               850         271        1,384         422
                                                               --------    --------     --------     -------  
  Gross profit                                                      492        (131)         728         (74)
                                                               --------    --------     --------     -------
Research, development and regulatory affairs expenses             1,550         746        2,908       1,496
Selling and administrative expenses                               1,450       1,220        2,550       2,282
                                                               --------    --------     --------     -------
   Total operating expenses                                       3,000       1,966        5,458       3,778
                                                               --------    --------     --------     -------
Loss from operations                                             (2,508)     (2,097)      (4,730)     (3,852)

Interest expense                                                   (103)         (7)        (191)         (8)
Investment and interest income                                      291         405          645         665
                                                               --------    --------     --------    --------
Net loss                                                       $ (2,320)   $ (1,699)    $ (4,276)   $ (3,195)
                                                               ========    ========     ========    ========
Shares used in computation of net
loss per share - basic and diluted                               13,264      13,186      13,258       12,701
                                                               ========    ========     ========    ========
Net loss per share - basic and diluted                         $  (0.17)   $  (0.13)    $  (0.32)   $  (0.25)
                                                               ========    ========     ========    ========  


   The accompanying notes are an integral part of these financial statements.
</TABLE>

                                       4

<PAGE>

                           Closure Medical Corporation
                             Statement of Cash Flows
                                   (Unaudited)
                                 (In thousands)


<TABLE>
<S> <C>
                                                                                            Six Months Ended
                                                                                      June 30,            June 30,
                                                                                        1998                1997
                                                                                      --------              ------- 
Cash flows from operating activities:                                                                           
Net loss                                                                        $     (4,276)       $     (3,195)

Adjustments to reconcile net loss to net cash
provided (used) by operating activities:

Depreciation and amortization expense                                                    200                  71
Amortization of deferred compensation on stock options                                   151                 152
Net loss on disposals of fixed assets                                                      8                   4
Change in accounts receivable                                                            368                 (20)
Change in inventories                                                                   (248)                (17)
Change in prepaid expenses                                                                73                  52
Change in accounts payable and accrued expenses                                         (882)                160
Change in deferred revenue                                                               327                 (15)
                                                                                ------------          ----------
Net cash used by operating activities                                                 (4,279)             (2,808)
                                                                                ------------          ----------

Cash flows from investing activities:
Additions to furniture, fixtures and equipment                                        (2,885)               (609)
Additions to intangible assets                                                          (164)                (74)
Purchases of investments                                                              (8,150)            (18,813)
Proceeds from the sale of investments                                                  9,945              11,590
                                                                                ------------          ----------
Net cash used by investing activities                                                 (1,254)             (7,906)
                                                                                ------------          ----------

Cash flows from financing activities:
Proceeds from borrowings                                                               1,500                   -
Repayment of debt                                                                        (50)                  -
Net proceeds from sale of common stock                                                   177              12,098
Proceeds from capital lease obligations                                                    -                 491
Payments under capital lease obligations                                                (111)                (33)
                                                                                ------------          ----------

Net cash provided by financing activities                                              1,516              12,556
                                                                                ------------          ----------

Increase (decrease) in cash and cash equivalents                                      (4,017)              1,842
Cash and cash equivalents at beginning of period                                       7,277              13,024
                                                                                ------------          ----------

Cash and cash equivalents at end of period                                      $      3,260          $   14,866
                                                                                ============          ==========
   The accompanying notes are an integral part of these financial statements.
</TABLE>

                                       5

<PAGE>


                           Closure Medical Corporation
                          Notes to Financial Statements
                                   (Unaudited)

                                                        
1.  Organization and Operations

Closure  Medical  Corporation  ("Closure"  or  the  "Company"),  formerly  named
Tri-Point Medical Corporation, develops, manufactures and commercializes medical
tissue cohesive products based on its proprietary  cyanoacrylate  technology for
use in wound  closure in humans and  animals.  The Company was  incorporated  in
Delaware on February  20,  1996.  From May 10, 1990 to February  29,  1996,  the
business  of  the  Company  was  conducted  by  Tri-Point  Medical  L.  P.  (the
"Partnership").   On  March  1,  1996,  substantially  all  of  the  assets  and
liabilities  of the  Partnership,  except  for  the  indebtedness  to  Sharpoint
Development Corporation  ("Sharpoint"),  the Partnership's general partner, were
transferred  to the Company in exchange  for one share of Common  Stock.  On the
effective  date of the Company's  initial public  offering,  September 25, 1996,
obligations of and interests in the Partnership  were contributed to the Company
in exchange for an aggregate of 9,600,000 shares of Common Stock.

In April 1997,  the Company  completed a follow-on  offering.  An  aggregate  of
1,725,000 shares (including the over-allotment  option) were sold at $12.875 per
share,  of which  1,025,000  shares were sold by the Company and 700,000  shares
were  sold  by  a  stockholder,  generating  net  proceeds  to  the  Company  of
approximately $12,020,000.

2.  Significant Accounting Policies

The  significant  accounting  policies  followed  by  the  Company  for  interim
financial  reporting are consistent  with the accounting  policies  followed for
annual  financial  reporting.  These  unaudited  financial  statements have been
prepared in accordance  with Rule 10-01 of Regulation  S-X, and in  management's
opinion,  all  adjustments  of a normal  recurring  nature  necessary for a fair
presentation  have been  included.  Accordingly,  they do not include all of the
information and footnotes required by generally accepted  accounting  principles
for complete  financial  statements and should be read in  conjunction  with the
financial  statements  and notes  thereto for the year ended  December  31, 1997
included in the Company's Annual Report on Form 10-K for the year ended December
31, 1997.

The results of  operations  for the three and six month  periods  ended June 30,
1998 are not  necessarily  indicative of the results to be expected for the full
year ending December 31, 1998.

Statement of Financial  Accounting  Standards No. 130, "Reporting  Comprehensive
Income" ("SFAS 130"),  was issued in June 1997. SFAS 130  establishes  standards
for reporting and display of  comprehensive  income and its components in a full
set of general-purpose financial statements. SFAS 130 is effective for financial
statements  for fiscal years  beginning  after  December  31, 1997.  The Company
adopted SFAS 130 effective  January 1, 1998;  the adoption of this statement did
not have a material impact on its financial position or results of operations.

Statement of Financial Accounting Standards No. 131, "Disclosures About Segments
of an Enterprise and Related Information" ("SFAS 131"), was issued in June 1997.
SFAS 131 specifies  revised  guidelines for  determining  an entity's  operating
segments and the type and level of financial  information  to be disclosed.  The
Company  adopted  SFAS 131  effective  January 1,  1998;  the  adoption  of this
statement did not have a material impact on its financial position or results of
operations.

3.  Taxes

No  federal or state  income  tax  provision  has been  provided  for income tax
purposes,  as the Company does not expect to have a tax  liability  for the year
ending  December  31, 1998.  Additionally,  the deferred tax asset that might be
recorded  as a result of net  operating  losses  under  Statement  of  Financial
Accounting  Standards No. 109, "Accounting for Income Taxes," has been offset by
a related valuation  allowance  because  realization of the asset is not likely.
Accordingly, no benefit has been recorded.


                                       6

<PAGE>

                           Closure Medical Corporation
                          Notes to Financial Statements
                                   (Unaudited)

4.  Inventories

Inventories included the following:
<TABLE>
<S> <C>   

                                      June 30,            December 31,
                                       1998                   1997
                                     ---------             ----------
                                              (In thousands)

Packaging                           $        58           $        45
Raw materials                               108                    54
Work-in-process                             309                   224
Finished goods                              120                    24
                                    -----------           -----------
                                    $       595           $       347
                                    -----------           -----------
</TABLE>

5.    Net Loss Per Share

Basic net loss per share is computed using the weighted average number of common
and common equivalent shares outstanding during the periods.

Diluted  net loss per share is computed  using the  weighted  average  number of
common and common  equivalent  shares  outstanding  during the  periods.  Common
equivalent  shares  consist of stock  options  using the treasury  stock method.
Common equivalent shares from stock options are excluded from the computation if
their effect is antidilutive.

                                       7
<PAGE>

Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS



The  following  discussion  should  be read in  conjunction  with the  unaudited
financial  statements and notes thereto  included in Part I--Item 1 of this Form
10-Q and the audited  financial  statements  and notes thereto and  Management's
Discussion and Analysis of Financial Condition and Results of Operations for the
year ended  December 31, 1997  contained in the Company's  Annual Report on Form
10-K for the year ended December 31, 1997.

The statements  set forth below that are not  historical  facts or statements of
current  conditions  are  forward-looking   statements.   Such   forward-looking
statements may be identified by, among other things,  the use of forward-looking
terminology such as "believes,"  "expects,"  "forecasts,"  "estimates," "plans,"
"continues,"  "may,"  "will,"  "should,"  "anticipates,"  or  "intends"  or  the
negative thereof or other variations  thereon or comparable  terminology,  or by
discussions of strategy or intentions. These forward-looking statements, such as
statements regarding present or anticipated scientific progress,  development of
potential  products,  future  revenues,  capital  expenditures  and research and
development  expenditures,  future  financings and  collaborations,  management,
manufacturing development and capabilities,  regulatory clearances and approvals
and other statements  regarding matters that are not historical  facts,  involve
predictions.  The Company's  actual results,  performance or achievements  could
differ   materially  from  the  results  expressed  in,  or  implied  by,  these
forward-looking statements.  Potential risks and uncertainties that could affect
the Company's actual results,  performance or achievements  include, but are not
limited to, the "Risk Factors" set forth in the Company's  Annual Report on Form
10-K for the year ended December 31, 1997 filed with the Securities and Exchange
Commission.  Given these  uncertainties,  current or  prospective  investors are
cautioned not to place undue  reliance on any such  forward-looking  statements.
Furthermore,  the Company  disclaims any obligation or intent to update any such
factors or forward-looking statements to reflect future events or developments.

OVERVIEW

Since its inception in May 1990, the Company has been developing,  manufacturing
and commercializing medical tissue cohesive products for use in wound closure in
humans  and  animals.  The  Company's  products  are  based  on its  proprietary
cyanoacrylate technology,  and a substantial portion of the Company's historical
expenses have consisted of research and development and clinical trial expenses.
Through  September 25, 1996, the effective date of the Company's  initial public
offering,  the  Company  had  funded  its  operations  with cash  borrowed  from
Sharpoint  Development  Corporation  ("Sharpoint"),  sales of  Octyldent(R)  and
Nexaband(R)  products,   and  license  and  product  development  revenues  from
marketing  partners.  On September 30, 1996,  the Company  completed its initial
public  offering,  issuing  2,550,000  shares of Common Stock and generating net
proceeds of approximately $17,926,000. On April 2, 1997, the Company completed a
follow-on  public  offering,  issuing  1,025,000  shares  of  Common  Stock  and
generating net proceeds of approximately $12,020,000.

The Company has been  unprofitable  since its  inception  and has  incurred  net
losses in each year,  including a net loss of  approximately  $6,829,000 for the
year ended  December  31,  1997.  The  Company  anticipates  that its  recurring
operating  expenses will increase for the next several years,  as it expects its
research and development and selling and administrative  expenses to increase in
order to develop new products,  manufacture  in commercial  quantities  and fund
additional clinical trials. The Company also expects to incur additional capital
expenditures to expand its  manufacturing  capabilities.  The Company expects to
continue  to incur a loss in 1998 and may  incur  losses  in  subsequent  years,
although  the amount of future net losses and time  required  by the  Company to
reach  profitability  are highly  uncertain.  The Company's  ability to generate
significant  revenue  and  become  profitable  will  depend  on its  success  in
commercializing  DERMABOND,  including the receipt of all regulatory  clearances
and approvals, expanding its manufacturing capabilities, developing new products
and entering  into  additional  marketing  agreements  and on the ability of its
marketing  partners to commercialize  successfully  products  incorporating  the
Company's technologies. No assurance can be given that the Company will generate
significant revenue or become profitable on a sustained basis, if at all.

                                       8
<PAGE>


The  Company is awaiting  approval  from the U.S.  Food and Drug  Administration
("FDA") of its premarket approval  application to market DERMABOND in the United
States upon completion of the regulatory process,  including the approval of the
Company's  color  additive  petition for use of a color  additive in  DERMABOND.
There can be no assurance  that the Company will be able to obtain the necessary
approvals from the FDA to market and manufacture  DERMABOND in the United States
for its intended use on a timely basis, if at all.

RESULTS OF OPERATIONS

Product sales were $1,342,000 for the three months ended June 30, 1998, compared
to $140,000 for the three  months ended June 30, 1997.  For the six months ended
June 30, 1998,  product sales were $2,112,000  compared to $348,000 for the same
period of 1997.  The  increase in 1998 product  sales was  primarily a result of
increased sales volume of DERMABOND in non-U.S. markets.

Cost of products  sold were  $850,000  for the three months ended June 30, 1998,
compared to $271,000 for the three months ended June 30, 1997.  Cost of products
sold as a percentage of product sales decreased to 63% in the three months ended
June 30,  1998,  compared to 194%  during the same  period of 1997.  For the six
months ended June 30, 1998,  cost of products sold were  $1,384,000  compared to
$422,000 for the same period of 1997.  Cost of products  sold as a percentage of
product sales  decreased to 66% in the six months ended June 30, 1998,  compared
to 121% during the same period of 1997. The decrease in cost of products sold as
a percentage  of product  sales was  primarily a result of the  increased  sales
volume of  DERMABOND  resulting  in the fixed  portion of cost of products  sold
being allocated over higher sales volume.

Operating  expenses  were  $3,000,000  for the three months ended June 30, 1998,
compared to  $1,966,000  for the three months  ended June 30, 1997.  For the six
months ended June 30, 1998 and June 30, 1997, operating expenses were $5,458,000
and $3,778,000, respectively. These increases were primarily attributable to the
addition of  personnel,  expansion of the  Company's  facilities  and  increased
research and development  and regulatory  affairs  expenses.  In March 1998, the
Company  relocated its corporate  offices into a 50,000 square feet facility and
expects to relocate its  manufacturing  operations  to the same facility in late
1998. Prior to the move, the Company occupied approximately 20,000 square feet.

Interest expense was $103,000 for the three months ended June 30, 1998, compared
to $7,000 for the three  months  ended June 30,  1997.  For the six months ended
June 30,  1998 and June 30,  1997,  interest  expense was  $191,000  and $8,000,
respectively.  These increases were a result of the Company  entering into a new
lease  line  and  term  loan  during  March  and  November  1997,  respectively.
Additionally,  the  Company  increased  its  borrowings  under  the term loan in
February 1998.

Investment and interest  income was $291,000 for the three months ended June 30,
1998,  compared  to  $405,000  for the same period of 1997.  This  decrease  was
attributed to interest earned from lower average cash and investment balances.

LIQUIDITY AND CAPITAL RESOURCES

The Company has financed its  operations to date  primarily  through the sale of
equity  securities,  borrowings  from Sharpoint and other  lenders,  license and
product  development  revenues,  and product sales  revenues.  Through March 31,
1998, the Company had raised  approximately $30 million in equity financing.  As
of March 29,1996,  all long-term debt to Sharpoint,  including accrued interest,
was contributed as partners' capital to the Partnership. The Company has entered
into and  received  approximately  $4.5  million from a lease line and term loan
since March 1997.  In  addition,  the Company has  received  approximately  $5.5
million related to the supply and distribution  agreement for DERMABOND  entered
into with  Ethicon,  Inc.  ("Ethicon")  in March 1996, of which $2.0 million has
been  classified  as  deferred  revenue  and  will be  credited  against  future
royalties and product purchases expected to be paid by Ethicon.


                                       9
<PAGE>

Net cash used by operating  activities was $4,279,000 and $2,808,000 for the six
months ended June 30, 1998 and 1997, respectively.

Net cash used for investing activities was $1,254,000 and $7,906,000 for the six
months  ended June 30, 1998 and 1997,  respectively.  The  increase for the 1998
period was  primarily  related to leasehold  improvements  of the  Company's new
50,000 square feet facility and  acquisition  of capital  equipment.  During the
same period of 1997, cash was used primarily to purchase investments.

Net cash provided by financing activities was $1,516,000 and $12,556,000 for the
six months ended June 30, 1998 and 1997,  respectively.  The  Company's  primary
financing  activity  during the six months ended June 30, 1998 was the Company's
additional  borrowings under its term loan whereby the Company had borrowed $3.0
million as of June 30, 1998. The Company's primary financing activity during the
six months ended June 30, 1997 was the Company's follow-on offering of 1,725,000
shares of Common  Stock,  of which  1,025,000  shares  were sold by the  Company
generating net proceeds to the Company of approximately $12,020,000.

The Company  believes that existing cash and cash  equivalents and  investments,
which totaled  approximately  $18.7 million at June 30, 1998, will be sufficient
to finance its capital  requirements for at least 12 months. The Company expects
to incur a loss in 1998 and may incur losses in subsequent  years,  although the
amount  of  future  net  losses  and  time  required  by the  Company  to  reach
profitability are highly uncertain.  The Company  anticipates that its recurring
operating  expenses will increase for the next several years,  as it expects its
research and development and selling and administrative  expenses to increase in
order to develop new products,  manufacture  in commercial  quantities  and fund
additional clinical trials. The Company also expects to incur additional capital
expenditures to expand its manufacturing capabilities.

The Company's  future  capital  requirements,  however,  will depend on numerous
factors,  including (i) the Company's  ability to manufacture and  commercialize
successfully its lead product,  DERMABOND, (ii) the progress of its research and
product development  programs for future  nonabsorbable and absorbable products,
including clinical studies, (iii) the effectiveness of product commercialization
activities  and  marketing   agreements  for  its  future  products,   including
additional  scale-up of  manufacturing  capability  in  anticipation  of product
commercialization  and development and progress of sales and marketing  efforts,
(iv) the  ability of the  Company to  maintain  existing  marketing  agreements,
including its agreement with Ethicon for  DERMABOND,  and establish and maintain
new  marketing  agreements,  (v)  the  costs  involved  in  preparing,   filing,
prosecuting,  defending and enforcing intellectual property rights and complying
with regulatory  requirements,  (vi) the effect of competing  technological  and
market developments, (vii) timely receipt of regulatory clearances and approvals
and (viii)  general  economic  conditions.  There can be no  assurance  that the
Company  will  not be  required  to  seek  additional  capital  to  finance  its
operations  in the  future.  If the  Company's  currently  available  funds  and
internally  generated  cash flow are not  sufficient  to satisfy  its  financing
needs,  the Company  will be required to seek  additional  funding  through bank
borrowings and additional  public or private sales of its securities,  including
equity securities,  or through other arrangements with marketing partners. Other
than the Company's equipment financing line of credit and term loan, the Company
has no credit  facility or other committed  sources of capital.  There can be no
assurance that additional  funds, if required,  will be available to the Company
on favorable terms, if at all.

                                       10
<PAGE>



                           PART II. OTHER INFORMATION

Item 2.  Changes in Securities and Use of Proceeds.

The Company's  Registration  Statement on Form S-1  (Registration  No. 333-5425)
(the "Registration Statement") for the Company's initial public offering ("IPO")
of 3,000,000  shares of Common Stock, of which 2,550,000 shares were sold by the
Company,  was declared  effective by the Securities  and Exchange  Commission on
September 25, 1996 (the "Effective  Date"). The net proceeds to the Company from
the IPO were approximately $17,926,000.

For the period beginning on the Effective Date of the Registration  Statement on
September  25, 1996 through June 30, 1998,  reasonable  estimates of the uses of
proceeds from the IPO are as follows:

                                                              (millions)
                                                              --------- 
         Working capital                                        $5.2
         Research and development and regulatory affairs         7.5 (a)
         Capital expenditures                                    1.6 (b)
         Obtain and protect patents                               .3
                                                               -----
                  Total                                        $14.6

Of the above  uses of  proceeds  attributed  to working  capital,  approximately
$156,000  represented direct payments to directors for annual board compensation
and meeting fees and expenses and approximately  $2,159,000 represented payments
to  officers  of the  Company  for  compensation.  Included  in the  payments to
directors was approximately  $53,000 to two individuals  beneficially owning ten
percent or more of the Common Stock of the Company.  Additionally,  reflected in
working  capital is  approximately  $210,000  paid to a consultant  who provides
services to the Company.

Temporary  investments during this period have consisted  primarily of corporate
and municipal bonds and money market funds.  The Company invested all of the net
proceeds,  approximately  $18 million,  upon the  completion of the IPO and such
amount has been reduced as the expenditures  described above have been incurred.
As of June 30, 1998, the Company had  approximately  $15.4 million in short-term
and long-term investments,  which amount also includes proceeds of the Company's
follow-on offering in April 1997.

(a)  Regulatory affairs expenses primarily consist of clinical trial expenses.
(b)  Of the Company's  capital  expenditures of  approximately  $6.1 million for
     this period, approximately $4.5 million has been financed through a capital
     lease agreement and term loan (see "Management's Discussion and Analysis of
     Financial  Condition  and Results of  Operations  -  Liquidity  and Capital
     Resources" included in Item 1 of Part I of this Form 10-Q).

                                       11
<PAGE>


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

The Annual Meeting of  Stockholders  of the Company (the  "Meeting") was held on
June 3,  1998.  At the  Meeting,  the  following  nominees  were  re-elected  as
directors of the Company to serve until the Annual  Meeting of  Stockholders  of
the  Company in 2001 and until  their  successors  shall have been  elected  and
qualified and received the votes set forth after their names below:

Name of Nominee                        For                  Withheld
---------------                        ---                  -------- 
Richard W. Miller                   12,552,887               39,151
Rolf D. Schmidt                     12,553,537               38,501

Furthermore, the terms of office of the following directors continued after the
Meeting: Dennis C. Carey, F. William Schmidt, Randy H. Thurman and Robert V.
Toni.

In  addition,  at the  Meeting,  the  stockholders  of the Company  approved and
adopted  an  amendment  to  the  Company's  Amended  and  Restated  1996  Equity
Compensation  Plan (the "Plan") to increase the number of shares  authorized for
issuance under the Plan from 1,000,000 to 2,500,000  shares of Common Stock. The
results of the voting on such matter were as follows:

   For                  Against          Abstentions or Broker Non-Votes
   ---                  -------          -------------------------------
9,459,684               499,851                       26,668


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

         (a)      Exhibits.
                  11       Computation of pro forma net income (loss) per share 
                           (see Note 5 to Notes to Financial Statements in
                           Item 1 of Part I of this Form 10-Q).

                  27       Financial Data Schedule.

         (b)      Reports on Form 8-K.
                  None.

                                       12
<PAGE>


  
                                   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.


                                                CLOSURE MEDICAL CORPORATION



Date: August  5,  1998          By: \s\ Robert  V. Toni                        
                                   ______________________________________
                                    Robert V. Toni
                                    President and Chief Executive Officer



Date: August 5,   1998         By: \s\ J. Blount Swain         
                                   ______________________________________ 
                                    J. Blount Swain
                                    Vice President and Chief Financial Officer
                                    (Principal Financial and Accounting Officer)



<PAGE>



                                 EXHIBIT INDEX



Exhibit
Number               Description
-------              -----------
11                   Computation of Pro Forma Net Income (Loss) Per Share.

27                   Financial Data Schedule.