<PAGE>   1



                                 UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION

                              WASHINGTON, DC 20549

                                   FORM 10-Q


               [X]     QUARTERLY REPORT PURSUANT TO SECTION 13
                       OR 15(d) OF THE SECURITIES EXCHANGE ACT
                       OF 1934 FOR THE QUARTERLY PERIOD ENDED
                       SEPTEMBER 30, 1995.
                       ------------------
                                       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:  0-15006

                             T CELL SCIENCES, INC.
               (Exact name of registrant as specified in charter)

             Delaware                                  No. 13-3191702
      (State of Incorporation)               (I.R.S Employer Identification No.)
  

                  115 Fourth Avenue, Needham, Massachusetts 02194-2725
          (Address of principal executive offices)          (Zip code)

                                 (617) 433-0771
              (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   .
                            ---  ---

<TABLE>
<CAPTION>
                                   Class                       Outstanding as of
                                   -----                       November 9, 1995 
                                                               -----------------
                        <S>                                        <C>
                        Common Stock, par value $.001              19,692,890
</TABLE>






                                       1


<PAGE>   2


                             T CELL SCIENCES, INC.
                               TABLE OF CONTENTS
                               SEPTEMBER 30, 1995


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

                     PART I - FINANCIAL INFORMATION
                     ------------------------------
                     Consolidated Balance Sheets --
                              September 30, 1995 and December 31, 1994 . . . . . . . . . . . . . . . . . . . . . . .   3

                     Consolidated Statements of Operations --
                              Nine months ended September 30, 1995 and 1994  . . . . . . . . . . . . . . . . . . . .   4
                              Quarters ended September 30, 1995 and 1994 . . . . . . . . . . . . . . . . . . . . . .   5

                     Consolidated Statements of Cash Flows --
                              Nine months ended September 30, 1995 and 1994  . . . . . . . . . . . . . . . . . . . .   6

                     Notes to Consolidated Financial Statements  . . . . . . . . . . . . . . . . . . . . . . . . . .   7

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


                     PART II   OTHER INFORMATION
                     ---------------------------

                     Item 1.  Legal Proceedings  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  12

                     Item 5.  Other Information  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  13

                     Item 6.  Exhibits and Reports on Form 8-K
                              A.  Exhibits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  13
                              B.  Reports on Form 8-K  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  13

                     Signatures  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  14
</TABLE>



                                       2


<PAGE>   3



PART I.  FINANCIAL INFORMATION


ITEM 1.  FINANCIAL STATEMENTS
         --------------------

T CELL SCIENCES, INC.
CONSOLIDATED BALANCE SHEETS
SEPTEMBER 30, 1995 AND DECEMBER 31, 1994


<TABLE>
<CAPTION>
                                                                        SEPTEMBER 30,     December 31,
                                                                             1995             1994
- ----------------------------------------------------------------------------------------------------------                          
<C>                                                                       <C>             <C>              
ASSETS
Current Assets:
     Cash, Cash Equivalents and Short Term Investments                    $6,230,896      $   16,184,319
     Accounts Receivable, Net                                                404,566             551,316
     Inventories                                                             521,969             409,266
     Prepaid Expenses and Other                                              578,059             534,653
- ----------------------------------------------------------------------------------------------------------

         Total Current Assets                                               7,735,490         17,679,554

Property and Equipment, Net                                                 1,295,781          1,060,193
Other Noncurrent Assets                                                     2,641,288          1,944,784
- ----------------------------------------------------------------------------------------------------------
         Total Assets                                                     $11,672,559        $20,684,531
- ----------------------------------------------------------------------------------------------------------

LIABILITIES AND STOCKHOLDERS  EQUITY
Current Liabilities:
     Accounts Payable                                                     $   833,579           $786,344
     Accrued Expenses                                                         994,752          1,812,508
- ----------------------------------------------------------------------------------------------------------

         Total Current Liabilities                                          1,828,331          2,598,852
- ----------------------------------------------------------------------------------------------------------

Collaborator Advance                                                          181,573            500,000
- ----------------------------------------------------------------------------------------------------------

Stockholders'  Equity:
     Class B preferred stock, $2 Par Value;
         1,163,102 Shares Authorized                                                -                  -
     Class C preferred stock, $.01 Par Value;
         3,000,000 Shares Authorized                                                -                  -
     Common Stock, $.001 Par Value; 50,000,000 Shares
         Authorized; 17,112,002 and 17,054,222 Shares
         Issued and Outstanding                                                17,112             17,054
     Additional Paid-in Capital                                            55,866,408         55,726,143
     Less:  8,446 and 16,323 Common Treasury Shares at Cost                   (39,830)           (76,931)
     Accumulated Deficit                                                  (46,181,035)       (38,080,587)
- ----------------------------------------------------------------------------------------------------------

         Total Stockholders'  Equity                                        9,662,655         17,585,679
- ----------------------------------------------------------------------------------------------------------

         Total Liabilities and Stockholders' Equity                       $11,672,559        $20,684,531
- ----------------------------------------------------------------------------------------------------------
</TABLE>


See accompanying notes to financial statements



                                       3


<PAGE>   4

T CELL SCIENCES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1995 AND 1994



<TABLE>
<CAPTION>
                                                                         SEPTEMBER 30,        September 30,
                                                                             1995                 1994
- -------------------------------------------------------------------------------------------------------------
<S>                                                                       <C>                   <C>
OPERATING REVENUE:

Product Development and Licensing Agreements                              $ 1,329,428           $ 3,643,044
Product Sales                                                               1,820,043             2,385,529
- -------------------------------------------------------------------------------------------------------------

        Total Operating Revenue                                             3,149,471             6,028,573
- -------------------------------------------------------------------------------------------------------------

OPERATING EXPENSE:

Cost of Product Sales                                                       1,448,529             1,518,498
Research and Development                                                    5,994,478             7,326,840
General and Administrative                                                  2,999,578             3,370,659
Marketing and Sales                                                         1,208,218             1,148,493
Facility Relocation                                                            85,132               706,300
- -------------------------------------------------------------------------------------------------------------
        Total Operating Expenses                                           11,735,935            14,070,790
- -------------------------------------------------------------------------------------------------------------

Operating Loss                                                             (8,586,464)           (8,042,217)

Interest Income, Net                                                          486,016               869,081
- -------------------------------------------------------------------------------------------------------------

Net Loss                                                                  $(8,100,448)          $(7,173,136)
- -------------------------------------------------------------------------------------------------------------

Net Loss Per Common Share                                                 $     (0.47)          $     (0.42)
- -------------------------------------------------------------------------------------------------------------

Weighted Average Common Shares Outstanding                                 17,066,026            17,053,181
- -------------------------------------------------------------------------------------------------------------
</TABLE>


See accompanying notes to financial statements





                                       4


<PAGE>   5





T CELL SCIENCES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE QUARTERS ENDED SEPTEMBER 30, 1995 AND 1994

<TABLE>

<CAPTION>
                                                                        SEPTEMBER 30,  September 30,
                                                                            1995            1994
- -----------------------------------------------------------------------------------------------------
<S>                                                                       <C>           <C>
OPERATING REVENUE:

Product Development and Licensing Agreements                              $   192,812   $   858,044
Product Sales                                                                 582,560       660,417
- -----------------------------------------------------------------------------------------------------

        Total Operating Revenue                                               775,372     1,518,461
- -----------------------------------------------------------------------------------------------------

OPERATING EXPENSE:

Cost of Product Sales                                                         476,322       489,631
Research and Development                                                    2,000,878     2,246,599
General and Administrative                                                    952,267       966,076
Marketing and Sales                                                           470,838       372,918
Facility Relocation                                                            85,132       593,038
- -----------------------------------------------------------------------------------------------------

        Total Operating Expenses                                            3,985,437     4,668,262
- -----------------------------------------------------------------------------------------------------

Operating Loss                                                             (3,210,065)   (3,149,801)

Interest Income, Net                                                          104,951       192,134
- -----------------------------------------------------------------------------------------------------
Net Loss                                                                  $(3,105,114)  $(2,957,667)
- -----------------------------------------------------------------------------------------------------
Net Loss Per Common Share                                                 $     (0.18)  $     (0.17)
- -----------------------------------------------------------------------------------------------------
Weighted Average Common Shares Outstanding                                 17,087,800    17,054,222
- -----------------------------------------------------------------------------------------------------

</TABLE>

See accompanying notes to financial statements





                                       5


<PAGE>   6





T CELL SCIENCES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1995 AND 1994

<TABLE>
<CAPTION>
                                                                        SEPTEMBER 30,     September 30,
                                                                            1995               1994
- --------------------------------------------------------------------------------------------------------
<S>                                                                      <C>               <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
     Net Loss                                                             $(8,100,448)     $(7,173,136)
     Adjustments to Reconcile Net Loss to Net Cash
         Used by Operating Activities:
             Depreciation and Amortization                                    402,172          644,787

     Net Change in Current Assets and Total Liabilities                    (1,098,307)         159,135
- --------------------------------------------------------------------------------------------------------
     Net Cash Used by Operating Activities                                 (8,796,583)      (6,369,214)

CASH FLOWS FROM INVESTING ACTIVITIES:
     Acquisition of Property and Equipment                                   (686,783)        (848,918)
     Sales of Equipment, Net                                                  108,059                -
     Increase in Patents and Other Noncurrent Assets                         (755,540)        (288,320)
     Redemption of Short Term Investments                                   8,539,666        4,370,606
     Purchase of Short Term Investments                                             -         (952,227)
- --------------------------------------------------------------------------------------------------------

     Net Cash Provided by Investing Activities                              7,205,402        2,281,141

CASH FLOWS FROM FINANCING ACTIVITIES:
     Sale of Stock                                                             16,739                -
     Proceeds from Exercise of Stock Options                                  160,685           13,306
- --------------------------------------------------------------------------------------------------------

     Net Cash Provided by Financing Activities                                177,424           13,306
- --------------------------------------------------------------------------------------------------------

Increase(Decrease) in Cash and Cash Equivalents                            (1,413,757)      (4,074,767)

Cash and Cash Equivalents at Beginning of Period                            7,644,653        5,151,419
- --------------------------------------------------------------------------------------------------------

CASH AND CASH EQUIVALENTS AT END OF PERIOD                                 $6,230,896      $ 1,076,652
- --------------------------------------------------------------------------------------------------------
</TABLE>


See accompanying notes to financial statements





                                       6


<PAGE>   7

                             T CELL SCIENCES, INC.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                          SEPTEMBER 30, JUNE 30, 1995


(1) NATURE OF BUSINESS
    ------------------

         T Cell Sciences, Inc. (the "Company"), was
incorporated in the State of Delaware on December 9, 1983,
and is utilizing proprietary complement inhibitor and T
cell receptor technology to develop pharmaceutical
products to treat diseases of inflammation and
autoimmunity.  T Cell Diagnostics, Inc. ("TCD"), a
wholly-owned subsidiary of the Company, develops,
manufactures and markets innovative preclinical reagents
and immune monitoring products.

         The consolidated financial statements include the
accounts of T Cell Sciences, Inc. and its wholly owned
subsidiary, T Cell Diagnostics, Inc.  All intercompany
transactions have been eliminated.

(2) INTERIM FINANCIAL STATEMENTS
    ----------------------------

         The accompanying financial statements for the
three and nine month periods ended September
30, 1995 and 1994 include the consolidated accounts of the
Company, and have been prepared in accordance with
generally accepted accounting principles for interim
reporting information and with the instructions to Form
10-Q and article 10 of Regulation S-X.  In the opinion of
management, the information contained herein reflects all
adjustments, consisting solely of normal recurring
adjustments, that are necessary to present fairly the
financial positions at September 30, 1995 and
December 31, 1994, the results of operations for the three
and nine month periods ended September 30, 1995
and 1994, and the cash flows for the nine month periods
ended September 30, 1995 and 1994.  The results of
operations for the three and nine month periods ended
September 30, 1995 are not necessarily indicative
of results for any future interim period or for the full
year.

         Certain information and footnote disclosures
normally included in financial statements prepared in
accordance with generally accepted accounting principles
have been omitted, although the Company believes that the
disclosures included are adequate to make the information
presented not misleading.  The consolidated financial
statements and the notes included herein should be read in
conjunction with footnotes contained in the Company's
Annual Report on Form 10-K for the year ended December 31,
1994.

(3) LITIGATION
- --------------

         In December 1994, the Company filed a lawsuit
against the landlord of its former Cambridge,
Massachusetts headquarters for damages it has incurred as
a result of the forced evacuation and relocation of its
operations due to air quality problems.  The


                                       7


<PAGE>   8


defendants in this lawsuit have counterclaimed alleging
that the Company has breached its lease obligations.  The
Company believes that losses arising from the
counterclaims are not probable and therefore, no amounts
have been recorded in the financial statements.  The
Company's insurance carrier has agreed to reimburse the
Company for certain legal expenses associated with defense
of certain of the counterclaims.  In July 1995 the bank
holding a mortgage on the building containing the Company's
former facilities filed a lawsuit in a different state
court against the Company to collect rents it alleges are
due to the bank, instead of the landlord, as a result of
an agreement pertaining to the financing of the initial
build-out of the facilities in 1987.  Although this lawsuit 
is still pending, the Company is proceeding with a motion 
to have the two lawsuits consolidated.  See Part II., 
I
tem 1. -- Legal Proceedings.

         The Company brought suit in July 1995 against its
insurance carrier and the policy underwriter for a
judgment that the Company is entitled to insurance
coverage for its property and business interruption losses
incurred as a result of the forced evacuation and
relocation.  This lawsuit has been dismissed as a result
of a November 8, 1995 settlement agreement.  See Item 2. --
Liquidity and Capital Resources.

(4) EQUIPMENT OPERATING LEASE
    -------------------------

         During 1994, the Company entered into an
operating lease agreement with a five year term to lease
up to $2 million of equipment. At September 30, 1995 the
Company had approximately $1,680,000 outstanding on the
lease.  The lease requires the Company to maintain certain
minimum financial covenants, determined as of the end of
each fiscal quarter, including cash, cash equivalents and
short term investment balances of not less than
$10,000,000 and certain financial ratios.  At September
30, 1995 the Company's cash, cash equivalents and short
term investment balances were below the minimum covenant
requirement.  In accordance with the terms of the lease
agreement, in November 1995, the Company pledged as
collateral to the lessor the cash amount equal to the
amount outstanding on the lease (see Exhibit 10.0).




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

                     RESULTS OF OPERATIONS

QUARTER ENDED SEPTEMBER 30, 1995 COMPARED TO QUARTER 
ENDED SEPTEMBER 30, 1994 -- The Company reported a 
consolidated net loss of $3,105,114 or $.18 per share for 
the quarter ended September 30, 1995, compared with a net 
loss of $2,957,667 or $.17 per share for the quarter ended 
September 30, 1994. Anticipated lower product development 
revenue and a decline in product sales, partially offset by 
reduced expenses, primarily contributed to the increased loss 
for the quarter compared to last year.  In July 1995, the 
Company implemented a cost containment program across all 
functional areas to



                                       8


<PAGE>   9


reduce expenses and restructure its manufacturing and
associated skills and capabilities.  The Company
recognized a charge of approximately $250,000 related to
the restructuring in the third quarter of 1995.  Results
of the third quarter of 1994 include $593,038 of
incremental expenses for the relocation of the Company's
operations from its Cambridge, Massachusetts facility.

        Product development revenue decreased 77.5% or  
$665,232 to $192,812 for the quarter ended September 30, 1995  
compared to the same quarter last year.  The decrease for the  
quarter ended September 30, 1995 is primarily the result 
of anticipated lower revenue from  the Company's  collaborative 
partner, Astra AB, in accordance with the Amended  and Restated 
Product Development and Distribution Agreement  of December 1993.  
Product sales revenue was $582,560 for the quarter ended 
September 30, 1995 reflecting an 11.8% decrease compared to the 
same period last year.  The decrease in product sales for the quarter
ended September 30, 1995 is primarily attributable to a shift in sales
focus to the launch of TRAx CD4 and increased competition in preclinical
products and continued weakness in the international diagnostic product
market.  The Company received clearance from the U.S. Food and Drug
Administration to market the TRAx CD4 test kit in May 1995.

         Gross margins decreased to 18.2% for the quarter ended 
September 30, 1995 compared to 25.9% for the quarter ended 
September 30, 1994.  The decrease for the quarter is primarily due to 
the inefficiences of producing at lower volumes.

         Research and development expenses decreased $245,721 
or 10.9% for the quarter ended September 30, 1995 compared to the 
same period last year.  The decrease is primarily attributable to 
the aggressive cost containment programs implemented during the 
latter part of 1994 combined with an additional cost containment 
and restructuring program implemented in July 1995. Anticipated 
increased costs associated with phase I clinical trials 
evaluating the use of TP10, the product name for soluble 
complement receptor type 1 (sCR1), partially offset the effects 
of the Company's restructuring and cost containment programs.

         General and administrative expenses decreased to 
$952,267 for the quarter ended September 30, 1995 from $966,076 
for the comparable period last year.  Reorganization of 
responsibilities and cost containment programs implemented during 
1994 and continued in 1995 have contributed to the decrease
in administrative expense.

         Marketing and sales expenses for the third
quarter increased 26.3% compared to last year.  The
increase is primarily due to the direct marketing and
sales campaign to launch the TRAx CD4 test kit.





                                       9


<PAGE>   10


         Facility relocation expenses for the third
quarter of 1994 represent unusual operating expenses
associated with the relocation of the Company's operations
due to air quality problems in its former Cambridge,
Massachusetts headquarters.  Rent on temporary facilities,
moving costs, and other related costs directly associated
with the relocation and air quality issues and expenses
associated with outfitting alternative facilities to meet
the Company's requirements are included in the relocation
cost component.

        Interest income decreased 45.4% to $104,951 for the 
quarter ended September 30, 1995 compared with $192,134 for 
the quarter ended September 30, 1994.  The decrease is 
primarily the result of lower cash balances during the quarter 
ended September 30, 1995 compared to the same period last year.


NINE MONTHS ENDED SEPTEMBER 30, 1995 COMPARED TO NINE
MONTHS ENDED SEPTEMBER 30, 1994 -- For the nine months ended
September 30, 1995, the Company reported a consolidated
net loss of $8,100,448 or $.47 per share, compared with a
net loss of $7,173,136 or $.42 per share for the nine
months ended September 30, 1994.  The increased loss for
the nine months ended September 30, 1995 compared to the
same period last year was primarily the result of lower
product development revenue and a decline in product sales
partially offset by reduced expenses in all functional
areas except marketing and sales, which increased in the
third quarter of 1995 due to expenses associated with the
launch of the TRAx(R) CD4 test kit.  During the third
quarter of 1995 the Company implemented a cost containment
program across all functional areas to reduce expenses and
a restructuring to enhance manufacturing capabilities.
Total costs associated with the restructuring were
approximately $250,000.  During the third quarter of 1994,
the Company relocated its operation from its Cambridge,
Massachusetts facility due to air quality problems.
Results for the nine months ended September 30, 1994
include $706,300 of incremental expenses related to the
relocation.

         Product development revenue decreased 63.5% or
$2,313,616 for the nine months ended September 30, 1995
compared to the same period last year.  The decrease
reflected the anticipated lower revenue from  the Company's
collaborative partner, Astra AB, in accordance with the
Amended and Restated Product Development and Distribution
Agreement ("the Agreement") of December 1993.   Product
development revenue for the nine months ended September
30, 1995 includes the reduction of an advance from Astra
AB for the construction of laboratory facilities at the
Company's former headquarters which were evacuated during
June 1994 due to air quality problems (see Part II., Item
1.).  The collaborator advance liability was reduced by
$318,427 to $181,573 based on the Agreement and management's
assessment of the Company's obligations within the
Agreement.  For the nine months ended September 30, 1994,
product development revenue included a non-refundable
execution fee associated with a TRAx product distribution
agreement which was subsequently terminated without any
future financial obligations and a milestone payment from
a TRAx product distribution partner for services in the
second quarter of 1994.





                                       10


<PAGE>   11


         Product sales revenue for the nine months ended
September 30, 1995 decreased 23.7% to $1,820,043 compared
to $2,385,529 for the comparable period last year.
Continued weakness in the international diagnostic product
market combined with  increased competition with certain
preclinical products to negatively impact sales for the nine 
month period compared to last year.  The Company received
clearance from the U.S. Food and Drug Administration in
May 1995 to market the TRAx CD4 test kit.  The Company
implemented an extensive marketing and sales program
during the third quarter of 1995.

         Gross margin decreased to 20.4% for the nine
months ended September 30, 1995 compared to 36.3% for the
same period last year.  The decrease for the nine months
is primarily due to inefficiencies of producing at lower
volumes.

         For the nine months ended September 30, 1995
research and development expenses were $5,994,478 compared
to $7,326,840 for the same period last year.  A
restructuring program which focused the organization
further on priority projects was implemented during the
third quarter of 1995 to add to the effects of the cost
containment programs implemented in the latter part of
1994.  Costs associated with two phase I clinical trials
evaluating the use of TP10 partially offset the effects of
the Company's restructuring and cost containment programs.
The first phase I clinical trial began in the latter part
of 1994 in patients at risk of developing adult
respiratory distress syndrome (ARDS) and was completed
during the second quarter.  A second phase I clinical
trial to evaluate the use of TP10 in reperfusion injury
following heart attack was initiated during the second
quarter of 1995.  The Company anticipates completion of
the second phase I clinical trial and initiation of an
additional ARDS trial in the fourth quarter of 1995 and
start of a phase II clinical trial in early 1996.

         General and administrative expenses decreased to
$2,999,578 for the nine months ended September 30, 1995
from $3,370,659 for the comparable period last year.
Reorganization of responsibilities and discretionary cost
containment programs implemented during 1994 and continued
in 1995, combined with the restructuring program
implemented during the third quarter of 1995, have
contributed to the decreased administrative expense.

         Interest income decreased to $486,016 or 44.1%
from $869,081 for the nine months ended September 30, 1995
compared to the prior year.  The decrease is primarily the
result of lower cash balances during the period ended
September 30, 1995 compared to last year.



            LIQUIDITY AND CAPITAL RESOURCES

         The Company had cash, cash equivalents and short term
investments of $6,230,896 at September 30, 1995.  The balance 
decreased by $9,953,423 from $16,184,319 at December 31, 1994.  
The decrease from December 31, 1994 is





                                       11


<PAGE>   12


primarily due to the net operating loss of $8,100,448
for the nine months ended September 30, 1995.

         The Company has no long-term debt.  During 1994,
the Company entered into an operating lease agreement with
a five year term to lease up to $2 million of equipment.
The lease arrangement requires that the Company maintain
certain restrictive financial covenants, determined at the
end of each fiscal quarter.  At September 30, 1995 the
Company's cash, cash equivalents and short term investment
balances were below the minimum covenant requirement.  In
November 1995, in accordance with the lease agreement, the 
Company pledged as collateral cash equal to the amount 
outstanding on the lease until the end of the lease or as 
otherwise agreed by the lessor and the Company.  At 
September 30, 1995  the Company had approximately $1,680,000 
outstanding on the lease.  The Company intends to continue to 
draw against the lease during 1995 to meet its capital 
requirements.

         The Company brought a lawsuit against its
insurance carrier and the policy underwriter in July 1995
to obtain insurance coverage for property and business
interruption losses incurred as a result of the air
quality problem at its former facility.  A settlement for
$2,900,000 was reached on November 8, 1995 and the lawsuit
has been dismissed (see Part II, Item 1. -- Legal Proceedings).

         In November 1995 the Company raised $6,375,000 of
gross proceeds through the sale of 2,550,000 shares of
common stock, $.001 par value in private placements with
several institutional and individual investors.  The
Company has filed a Registration Statement on Form S-3
with the Securities and Exchange Commission to permit the
purchasers to resell their shares.

         The Company believes its current cash, cash
equivalents and short term investments combined with cash
proceeds from its insurance settlement and capital
financing along with anticipated net cash provided by
operations and other planned activities will be adequate
to meet the Company's cash requirements for operations
into 1997.  The Company is considering additional sources
of funding through collaborative arrangements, capital
financing and other avenues to meet future cash
requirements.



P
ART II.  OTHER INFORMATION


ITEM 1.  LEGAL PROCEEDINGS:
         -----------------

         In connection with the Company's air quality
problems which caused skin and respiratory irritations to
a large number of its employees the Company filed a
lawsuit in December 1994 against the landlord of its
former Cambridge, Massachusetts headquarters for damages
it has incurred as a result of the forced evacuation and
relocation of its operations.  The defendants in this
lawsuit have counterclaimed alleging that the Company has
breached its lease obligations.  This lawsuit is in the
pre-trial stages and the Company





                                       12


<PAGE>   13

continues to believe that it will be successful in its
claims and defenses.  In July 1995 the bank holding a
mortgage on the building in which the Company's former
facilities were located filed a lawsuit in a different
state court against the Company to collect rents it
alleges are due to the bank, instead of the landlord, as a
result of an agreement pertaining to the financing of the
initial build-out of the former facilities in 1987.
The Company is proceeding with a motion to have this 
lawsuit consolidated with its lawsuit against the landlord.

         The Company brought suit in July 1995 against its 
insurance carrier and the policy underwriter for a judgment 
that the Company is entitled to insurance coverage for its 
property and business interruption losses incurred as a result
of the forced evacuation and relocation. This lawsuit has been 
dismissed as a result of a November 8, 1995 settlement agreement. 
See Item 2. -- Liquidity and Capital Resources.
        


ITEM 5.  OTHER INFORMATION:
         -----------------

         On October 2, 1995 the Company announced that
collaborators of the Company presented data at the 3rd
International Congress on Xenotransplantation in Boston
demonstrating the ability of sCR1 to significantly extend
the life of xenografts in a primate model of hyperacute
xenograft rejection.  The Company plans to develop TP10 in
xenotransplantation in partnership with other companies.

         On October 30, 1995 the Company announced results
of the Company's first Phase I clinical trial of TP10 in
patients at risk for Adult Respiratory Distress Syndrome
(ARDS).  Data from the trial indicate that TP10 is safe
and can significantly reduce complement activation in
patients with ARDS.

         On November 7, 1995 the Company reported that it
raised gross proceeds of $6,375,000 through the sale of 
2,550,000 shares of common stock, $.001 par value, in 
private placements with several institutional and 
individual investors.  The Company has filed a Registration 
Statement on Form S-3 with the Securities and Exchange 
Commission to cover the resale of these shares by investors.  
See Exhibit 20.0.


ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K
         --------------------------------

A. EXHIBITS

<TABLE>
         <S>     <C>
         10.0    Pledge Agreement dated October 24, 1995
                 between the Company and Fleet Credit Corp.
         20.0    T Cell Sciences, Inc. News Release dated November
                 7, 1995
</TABLE>


B. REPORTS ON FORM 8-K
         No reports on Form 8-K were filed during the Quarter ended 
         September 30, 1995.

                                       13


<PAGE>   14






                         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.


                                T CELL SCIENCES, INC.

                                    /s/ Alan W. Tuck
                               BY:________________________ 
                                    Alan W. Tuck
                                    President & Chief
                                    Executive Officer





                                       14






<PAGE>   1
                                                                  Exhibit 10.0

FLEET CREDIT CORPORATION                                      PLEDGE AGREEMENT


SECURED PARTY: FLEET CREDIT CORPORATION     DEBTOR: T CELL SCIENCES, INC.
               a Rhode Island Corporation           115 Fourth Avenue
               50 Kennedy Plaza                     Needham, Massachusetts 02194
               Providence, Rhode Island 02903-2305


        1. PLEDGE OF COLLATERAL. Debtor hereby pledges and grants to Secured
Party and its successors and assigns a continuing security interest in and to
the Collateral (hereinafter defined) to secure the due and punctual payment and
performance of all of the Obligations (hereinafter defined). As used herein,
the term "OBLIGATIONS" shall mean and include the following: (a) the due and
punctual payment and performance of all of Debtor's obligations under that
certain MASTER EQUIPMENT LEASE AGREEMENT NO. 31816, dated as of AUGUST 5, 1994,
to Secured Party (the "AGREEMENT"); (b) the performance of all obligations
contained herein; and (c) the performance of all other obligations and all
other indebtedness and liabilities of Debtor to Secured Party, of every kind
and description, now existing or hereafter arising, direct or indirect, secured
or unsecured, joint or several, absolute or contingent, due or to become due,
whether for payment or performance, regardless of how
 the same arise or by what
instrument, agreement or book account they may be evidenced, including without
limitation any such indebtedness and liabilities of Debtor to others which may
now or hereafter be obtained by Secured Party through purchase, negotiation,
discount, transfer, assignment or otherwise. As used herein, the term
"COLLATERAL" shall mean and include the following described property, together
with any documents, certificates, negotiable or non-negotiable instruments and
any other writing evidencing the Collateral or by which any deposit, transfer
negotiation, roll-over, renewal, substitution, withdrawal or other disposition
may be made with respect to the collateral (the "DOCUMENTS") and all proceeds
of and interest on any of the foregoing now existing or thereafter deposited,
credited, issued or arising therefrom:

        That certain Certificate of Deposit No. B421382, issued by Fleet Bank
        of Massachusetts, National Association, together with all renewals
        thereof or substitutions therefor, and all checks or other instruments
        representing the same or purchased with the proceeds thereof and all
        proceeds of and interest in any of the foregoing, whether now existing
        or hereafter deposited, credited, issued or arising.

All capitalized terms used herein and not otherwise defined herein shall have
the meanings set forth or referred to in the Agreement.

        2. DOCUMENTS. All Documents, now or hereafter evidencing any Collateral,
shall be delivered into the possession of Secured Party so that Secured Party
may perfect its security interest therein, and shall contain such endorsements
or assignments as Secured Party may in its sole discretion deem necessary or
advisable. Secured Party agrees that it will, from time to time upon the written
request of Debtor, accept a substitute or replacement Document for any item
of Collateral which has matured; PROVIDED, HOWEVER, that such substitute or
replacement document shall: (a) contain such endorsements or assignments as
Secured Party may in its sole discretion deem necessary or advisable; (b) be
issued by an institution acceptable in all respects to Secured Party, in its
sole discretion; and (c) be in an amount not less than the redemption value of
the item of Collateral being replaced. For so long as any of the Obligations
remain outstanding: (i) Debtor shall take no action of any kind whatsoever with
respect to the Collateral without Secured Party's prior written consent; and
(ii) Secured Party is hereby irrevocable authorized and appointed as agent and
attorney-in-fact of Debtor, which appointment is coupled with an interest, to
sign and deliver such documents, endorsements and instruments, including, but
not limited to the Documents, and to take all such action in the name of Debtor
or Secured Party, as Secured Party may in its sole discretion deem necessary or
advisable to perfect, preserve or enforce its interest in and lien on
the Collateral. If all or any part of the Collateral shall be or remain in the
hands of a third party with the consent of Secured Party, Debtor shall execute
and deliver to and obtain from such third party a NOTICE AND ACKNOWLEDGMENT OF
ASSIGNMENT in the form of EXHIBIT A hereto, and Secured Party shall be under no
obligation to release any funds under the Agreement until said Notice has been
duly executed and delivered by such third party to Secured Party.

        3. INTEREST; INCOME AND DIVIDENDS; VOTING RIGHTS; TAXES AND OTHER
CHARGES. Unless and until there shall be a default hereunder or under the
Agreement, Debtor shall be entitled to receive all interest, income and
dividends, if any, when and as payable on the Collateral; PROVIDED, HOWEVER,
that if any of the Collateral shall be comprised of equity securities
("SECURITIES"), all stock dividends or securities resulting from a stock split
or reclassification of such Securities, including all Documents with respect
thereto, shall be delivered to Secured Party to be retained by Secured Party as
Collateral hereunder. Debtor shall have sole voting and consensual rights with
respect to such Securities, except that Debtor shall not have the right to vote
or consent in any way that would result in violation of this Pledge Agreement.
Debtor shall pay prior to delinquency all taxes, charges, liens and assessments
against any of the Collateral and, upon Debtor's failure to do so, Secured Party
may, at its option, pay such charges and shall be the sole judge of the legality
and validity thereof and the amount so paid shall become an Obligation
hereunder.

        4. REPRESENTATIONS; WARRANTIES; COVENANTS AND AGREEMENTS. For so long
as any obligations remain outstanding, Debtor hereby represents, warrants, 
covenants and agrees that: (a) if Debtor is a business organization, Debtor is
duly organized, validly existing and in good standing under the laws of its
state of organization as set forth in the introduction hereof, and is duly
qualified to do business as a foreign business organization and in good
standing under the laws of each other jurisdiction in which its business or
properties require such qualification; (b) Debtor shall have full power to
enter into and perform this Pledge Agreement and has taken all necessary action
to authorize the execution, delivery and performance of this Pledge Agreement;
(c) this Pledge Agreement constitutes the legal, valid and binding obligation
of Debtor, enforceable in accordance with its terms, subject to bankruptcy,
insolvency or other similar laws affecting the rights of creditors generally;
(d) the execution, delivery and performance of this Pledge Agreement will not
violate any law, treaty or regulation applicable to Debtor, any of Debtor's
governing documents, any order or decree of any court, arbitrator or
governmental agency, or any contractual undertaking to which Debtor is a party
or by which Debtor may be bound; (e) no consents, licenses, approvals or
authorizations of, exemptions by or registrations or declarations with, any
governmental authority are required with respect to this Pledge Agreement; (f)
Debtor shall have title to the Collateral free and clear of all liens and
encumbrances except the interests created hereby; and (g) Secured Party shall
have the absolute and unqualified right to sell, at public or private sale, or
otherwise dispose of the Collateral, in whole or in Part, without restriction,
contingent only upon the conditions set forth in this Pledge Agreement.

        

<PAGE>   2
        5. PLEDGE UNCONDITIONAL. No invalidity, irregularity of
unenforceability of all or part of the Obligations or of any security therefor
shall affect, impair or be a defense to the enforcement of this Pledge
Agreement. The Obligations of Debtor hereunder shall be absolute and
unconditional, and shall not be released, discharged or in any way affected by:
(a) any amendment or modification of, or supplement to the Agreement or the
discharge or release, in whole or in part of any party thereto or any party
otherwise responsible for the payment and performance of any of the
Obligations; (b) any exercise or non-exercise of any right, remedy or privilege
hereunder or under the Agreement, or any other instrument provided for in the
Agreement, or any waiver, consent, extension, indulgence or other action or
inaction with respect to any such instrument; (c) the institution of any
bankruptcy, insolvency, reorganization, debt arrangement, readjustment,
composition, receivership or liquidation proceedings by or against any party
hereto or to the Agreement; or (d) any assumption by any third party of the
obligations under the Agreement, or any assignment by Secured Party.

        6. DEFAULT; REMEDIES. It shall be an "EVENT OF DEFAULT" hereunder if
Debtor breaches any representation, warranty, covenant or provision hereof or
of the Agreement, or defaults in the payment or performance of any Obligation;
or if there exists any event or condition which, with notice and/or passage of
time, would constitute a default under the Agreement or any other document,
agreement or instrument evidencing an Obligation. Upon the occurrence of an
Event of Default, Secured Party may apply any Collateral to the satisfaction of
any or all of the Obligations and pursue any additional rights or remedies
available to it under this Pledge Agreement or applicable law. Debtor will upon
demand pay to Secured Party all expenses incurred by Secured Party in
connection with the Collateral or the exercise of its rights or remedies
hereunder, including without limitation, reasonable attorney's fees and other
legal expenses, all of which shall constitute additional Obligations secured by
the Collateral hereunder. After any such Event of Default: (a) all interest,
income or dividends payable on the Collateral shall be the sole property of and
paid to Secured Party; and (b) Secured Party may at any time sell, assign and
deliver, negotiate, convert, or otherwise transfer or dispose of the Collateral
at or by any public or private sale in any commercially reasonable manner, and
may apply the proceeds therefrom to the payment of all Obligations. Debtor
agrees that it shall be commercially reasonable for Secured Party to withdraw
funds or liquidate any Collateral prior to its maturity, notwithstanding the
imposition of any early withdrawal or other penalties. Debtor hereby
irrevocably waives any bonds and any surety or security in connection with the
Collateral or the exercise of Secured Party's rights or remedies hereunder that
may be required by any statute, court rule or otherwise. Any notice required
to be given by Secured Party of a sale or other disposition or other intended
action by Secured Party with respect to any of the Collateral or otherwise
which is made in accordance with the terms of this Pledge Agreement at least
five (5) days prior to such proposed action, shall constitute fair and
reasonable notice to Debtor of any such action. Secured Party shall be liable
to Debtor only for its gross negligence or willful misconduct in failing to
comply with any applicable law imposing duties upon Secured Party; Secured
Party's liability for any such failure shall be limited to the actual loss
suffered by Debtor directly resulting from such failure. Secured Party shall
have no liability to Debtor in tort or for incidental or consequential damages.

        With respect to any Collateral traded on any recognized market or
exchange, upon the occurrence of an Event of Default Secured Party may, to the
fullest extent permitted by applicable law, sell all or any Collateral, free of
rights and claims of Debtor, without notice or advertisement of any kind, on
such market or exchange at a price reasonably consistent with the market price
effective at the time of such sale and, notwithstanding then current
fluctuations in such market price, any such sale shall be deemed reasonable for
all purposes if conducted under ordinary terms regardless of the date of such
sale or its proximity to the occurrence of an Event of Default. If a public
sale of all or a part of any securities is restricted by reason of any
provisions contained in the Securities Act of 1933, as amended (the "ACT"), or
if such public sale might only occur after delay which might adversely affect
the value that might be realized upon the sale of the Collateral, Secured Party
may sell the Securities or any part thereof, without the necessity of
registration or attempting to cause any registration of the Securities to be
effected under the Act, in one or more private sales to a restricted group of
purchasers who may be required to agree, among other things, that they are
acquiring the Securities for thier own account for investment and not with a
view to the distribution or resale thereof. Debtor acknowledges and agrees that
any such private sale may be at prices or on terms less favorable to the owner
of the Securities than would be the case if they were sold at public sale, and
that any such private sale shall be deemed to have been made in a commercially
reasonable manner. Debtor agrees that without affecting Secured Party's right
to dispose of the Collateral by private sale as aforesaid, it will, upon
request of Secured Party, if in the opinion of Secured Party's counsel
registration of the Securities of any part thereof is required under the Act,
use its best efforts to complete and cause to become effective a registration
of the Securities under the Act, and to take all other actions necessary, in
Secured Party's opinion, to enable Secured Party to sell, within ninety (90)
days of the commencement of such best efforts, the Securities pursuant to an
effective registration statement under the Act. Such best efforts shall be
commenced promptly after request by Secured Party, which may be given at any
time on or after the occurrence of an Event of Default. All expenses of such
registration, including, without limitation, registration and filing fees, blue
sky fees, printing expenses, fees and disbursements of counsel for Debtor and
Secured Party, fees and expenses of auditors of Debtor and Secured Party, and
all underwriter, broker or dealer discounts, and all transfer taxes shall be
borne by Debtor who agrees to do all acts and things which are usual and
customary in connection with registered offerings of securities, including
entering into indemnification agreements with Secured Party and any
underwriters. The managing underwriter of any public offering for which any
said registration statement is filed shall have the right to impose such
conditions on the sale of the Securities as it shall reasonably deem necessary
to protect the underwritten offering, provided such conditions are similarly
and proportionately imposed on other shares which may be included in said
registration as the result of the exercise of piggyback rights by the holders
of such other shares.

        7. ASSIGNMENT. The provisions of this Pledge Agreement shall be binding
upon and shall inure to the benefit of the heirs, administrators, successors
and assigns of Secured Party and Debtor, provided, however, that Debtor may not
assign any of its rights or delegate any of its Obligations hereunder without
the prior written consent of Secured Party. Secured Party may, from time to
time, without notice to Debtor, sell, assign, transfer, participate, pledge or
otherwise dispose of all or any part of the Obligations and/or the Collateral
therefor. In such event, each and every immediate and successive purchaser,
assignee, transferee, participant, pledgee, or holder of all or any part of the
Obligations and/or the Collateral (each a "HOLDER") shall have the right to
enforce this Pledge Agreement, by legal action or otherwise, for its own
benefit as fully as if such Holder were herein by name specifically given such
rights. Debtor agrees that the rights of any such Holder hereunder or with
respect to the related Obligations shall not be subject to any defense, set off
or counterclaim that Debtor may assert or claim against Secured Party, and that
any such Holder shall have all of the Secured Party's rights hereunder but none
of the Secured Party's obligations. Secured Party shall have an unimpaired
right to enforce this Pledge Agreement for its benefit with respect to that
portion of the Obligations which Secured Party has not sold, assigned,
transferred, participated, pledged or otherwise disposed of.

<PAGE>   3
        8. TERMINATION. Upon the payment and performance in full of all
Obligations, Secured Party shall deliver, or shall cause to be delivered, the
Collateral to Debtor (less any portion of same sold, assigned, transferred,
disposed of or applied by Secured Party pursuant to the provisions hereof), and
this Pledge Agreement shall thereupon be terminated.

        9. MISCELLANEOUS. No failure on the part of Secured Party to exercise
and no delay in exercising any right, power or remedy hereunder shall operate
as a waiver thereof. All rights and remedies in this Pledge Agreement are
cumulative and not alternative and are not exclusive of any other remedies
provided by law. Any provisions hereof contrary to, prohibited by or invalid
under applicable laws or regulations shall be inapplicable and deemed omitted
herefrom, and shall not invalidate the remaining provisions hereof. Debtor will
promptly deliver to Secured Party such further documents as assurance and take
such further action as Secured Party may from time to time reasonably request
in order more effectively to carry out the purpose of this Pledge Agreement and
to protect the rights and remedies of Secured Party hereunder, including
without limitation, the execution and delivery of financing statements under
the UCC. Debtor acknowledges receipt of a true copy and waives acceptance
hereof. THIS PLEDGE AGREEMENT CONSTITUTES THE ENTIRE AGREEMENT OF DEBTOR AND   
SECURED PARTY RELATIVE TO THE SUBJECT MATTER HEREOF, AND THERE ARE NO PRIOR OR
CONTEMPORANEOUS UNDERSTANDINGS OR AGREEMENTS, WHETHER ORAL OR IN WRITING,
BETWEEN THE PARTIES HERETO WITH RESPECT TO THE SUBJECT MATTER HEREOF, NEITHER
THIS PLEDGE AGREEMENT NOR ANY PROVISION HEREOF MAY BE CHANGED, WAIVED,
DISCHARGED OR TERMINATED EXCEPT BY AGREEMENT IN WRITING SIGNED BY THE PARTY
AGAINST WHICH ENFORCEMENT OF SUCH CHANGE, WAIVER, DISCHARGE OR TERMINATION IS
SOUGHT. Any notices and demands shall be in writing and sent to the parties by
regular mail at the addresses herein set forth or to such other address as the
parties may hereafter specify by written notice.

THIS PLEDGE AGREEMENT AND THE LEGAL RELATIONS OF THE PARTIES HERETO SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF RHODE
ISLAND, WITHOUT REGARD TO PRINCIPLES REGARDING THE CHOICE OF LAW. DEBTOR HEREBY
CONSENTS TO THE JURISDICTION OF THE COURTS OF THE STATE OF RHODE ISLAND AND THE
FEDERAL DISTRICT COURT FOR THE DISTRICT OF RHODE ISLAND FOR THE PURPOSES OF ANY
SUIT, ACTION OR OTHER PROCEEDING ARISING OUT OF ITS OBLIGATIONS HEREUNDER AND
EXPRESSLY WAIVES ANY OBJECTIONS TO THE VENUE OF SUCH COURTS. DEBTOR HEREBY
EXPRESSY WAIVES TRIAL BY JURY IN ANY ACTION BROUGHT ON OR WITH RESPECT TO THIS
PLEDGE aGREEMENT. Any action by Debtor against Secured Pary for any cause of
action relating to this Pledge Agreement shall be instituted within one year
after any such cause of action first arises.

Dated: October 24, 1995

FLEET CREDIT CORPORATION                       T CELL SCIENCES, INC.

     /s/ Alexis M. Smith                             /s/ Alan Tuck
By:______________________________              By:_____________________________

      Alexis Smith                                   Alan Tuck
Name:____________________________              Name:____________________________

       Vice President                                 President & CEO
Title:___________________________              Title:___________________________








<PAGE>   1
                                [T CELL LOGO]

                                                                 Exhibit 20.0

NEWS RELEASE
- ------------

Date:     FOR IMMEDIATE RELEASE/NOVEMBER 7, 1995

Contact:  Alan Tuck                                  Lori Martin
          President & Chief Executive Officer        Investor Relations
          T Cell Sciences, Inc.                      T Cell Sciences, Inc.
          (617) 433-0771                             (617) 433-3107



       T CELL SCIENCES, INC. ANNOUNCES OVER $6 MILLION PRIVATE PLACEMENT


Needham, MA, November 7, 1995 -- T Cell Sciences, Inc. (NASDAQ: TCEL) today
announced the closing of a $6.375 million private placement of 2.55 million
shares of T Cell Sciences Common Stock, $.001 par value. Several institutional
investors and private investors purchased shares of Common Stock pursuant to
stock purchase agreements. The Company has filed a registration statement with
the Securities and Exchange Commission to register the resale of the Common
Stock purchased by the investors. The Company directly placed a number of the
shares purchased and Allen & Company acted as placement agent for the other
shares.

"We are pleased we had the opportunity to raise additional capital and to
strengthen the Company's position for future growth," said Alan Tuck, President
and Chief Executive Officer. "The funds received from this financing will be
used primarily to advance the Company's complement inhibitor program,
 including
Phase II clinical trials in 1996. The completion of this financing plus the
additional positive announcements we expect over the next several months should
help us continue to build shareholder value."

In July of this year, T Cell completed Phase I clinical trials which indicate
soluble complement receptor 1, (product name TP10), is safe, and can inhibit
complement activation in adult patients at risk for Adult Respiratory Distress
Syndrome (ARDS). In May of this year, the Company's subsidiary T Cell
Diagnostics received FDA marketing clearance for TRAx[register mark] CD4, an
immunoassay test kit for the enumeration of CD4 T Cells, which is currently
being launched in the marketplace.

T Cell Sciences, Inc. is developing pharmaceutical products for the treatment of
inflammatory disorders and autoimmune diseases utilizing proprietary complement
inhibitor and T Cell receptor technology. T Cell Diagnostics, a wholly owned
subsidiary of T Cell Sciences, develops, manufactures and markets innovative
immune monitoring diagnostics and research products.

                                      ###


T Cell Sciences, Inc. 115 Fourth Avenue Needham, MA 02194-2725 USA 617-433-0771
- --------------------------------------------------------------------------------
                            Telefax 1-617-433-0262



<TABLE> <S> <C>

<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONSOLIDATED CONDENSED FINANCIAL STATEMENTS OF T CELL SCIENCES, INC. FOR THE
NINE MONTHS ENDED SEPTEMBER 30, 1995 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1
<CURRENCY> U.S. DOLLARS
       
<S>                             <C>
<PERIOD-TYPE>                   9-MOS
<FISCAL-YEAR-END>                          DEC-31-1995
<PERIOD-START>                             JAN-01-1995
<PERIOD-END>                               SEP-30-1995
<EXCHANGE-RATE>                                      1
<CASH>                                       6,230,896
<SECURITIES>                                         0
<RECEIVABLES>                                  425,566
<ALLOWANCES>                                  (21,000)
<INVENTORY>                                    521,969
<CURRENT-ASSETS>                             7,735,490
<PP&E>                                       4,369,914
<DEPRECIATION>                             (3,074,133)
<TOTAL-ASSETS>                              11,672,559
<CURRENT-LIABILITIES>                        1,828,331
<BONDS>                                              0
<COMMON>                                        17,112
<PREFERRED-MANDATORY>                                0
<PREFERRED>                                          0
<OTHER-SE>                                   9,645,543
<TOTAL-LIABILITY-AND-EQUITY>                11,672,559
<SALES>                                      1,820,043
<TOTAL-REVENUES>                             3,149,471
<CGS>                                        1,448,529
<TOTAL-COSTS>                               10,287,406
<OTHER-EXPENSES>                                     0
<LOSS-PROVISION>                                     0
<INTEREST-EXPENSE>                           (486,106)
<INCOME-PRETAX>                            (8,100,448)
<INCOME-TAX>                                         0
<INCOME-CONTINUING>                                  0
<DISCONTINUED>                                       0
<EXTRAORDINARY>                                      0
<CHANGES>                                            0
<NET-INCOME>                               (8,100,448)
<EPS-PRIMARY>                                    (.47)
<EPS-DILUTED>                                    (.47)
        

</TABLE>