<PAGE>   1
                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549

                                    FORM 10-Q

                   Quarterly Report Under Section 13 or 15(d)
                     of the Securities Exchange Act of 1934


(Mark One)

[X]      Quarterly Report Pursuant to Section 13 or 15(d) of The Securities 
         Exchange Act of 1934.

         For the quarterly period ended     March 31, 1997
                                        ----------------------

                                       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 #0-14732

                            ADVANCED MAGNETICS, INC.
             (Exact name of registrant as specified in its charter)


               Delaware                                      04-2742593 
(State or other jurisdiction of organization)       (IRS Employer Incorporation
                                                       or Identification No.)



                               725 Concord Avenue
                               Cambridge, MA 02138
                    (Address of principal executive offices)


       Registrant's telephone number, including area code: (617) 354-3929


         Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.


Yes  X   No
    ---     ---


At May 12, 1997, 6,735,645 shares of registrant's common stock (par value, $.01)
were outstanding.


<PAGE>   2

                            ADVANCED MAGNETICS, INC.

                                    FORM 10-Q

                          QUARTER ENDED MARCH 31, 1997




                          PART I. FINANCIAL INFORMATION




                         Item 1 -- Financial Statements



                                     Page 2


<PAGE>   3

                            ADVANCED MAGNETICS, INC.

<TABLE>
                                  BALANCE SHEET
                      MARCH 31, 1997 AND SEPTEMBER 30, 1996
                                   (Unaudited)

<CAPTION>

                             ASSETS                           March 31,     September 30,
                             ------                           ---------     -------------
                                                                1997            1996
                                                                ----            ----

<S>                                                         <C>              <C>        
Current assets:
Cash and cash equivalents ...............................   $12,148,069      $10,805,842
Marketable securities (Note B) ..........................    25,856,942       23,271,169
Accounts receivable .....................................       253,883          149,235
Inventories .............................................        47,870          182,166
Prepaid expenses ........................................       295,850          131,234
                                                            -----------      -----------
  Total current assets ..................................    38,602,614       34,539,646
                                                            -----------      -----------

Property, plant and equipment:
Land ....................................................       360,000          360,000
Building ................................................     4,321,566        4,320,766
Laboratory equipment ....................................     7,426,050        7,316,534
Furniture and fixtures ..................................       582,919          553,149
                                                            -----------      -----------
                                                             12,690,535       12,550,449

Less--accumulated depreciation and amortization .........    (6,762,309)      (6,219,579)
                                                            -----------      -----------
Net property, plant and equipment .......................     5,928,226        6,330,870
                                                            -----------      -----------

Other assets ............................................       195,857          195,857
                                                            -----------      -----------
  Total assets ..........................................   $44,726,697      $41,066,373
                                                            ===========      ===========

LIABILITIES AND STOCKHOLDERS' EQUITY
- ------------------------------------
Current liabilities:
Accounts payable ........................................   $   367,380      $   383,335
Accrued expenses ........................................       643,541          500,365
Income taxes payable ....................................        50,128           50,128
                                                            -----------      -----------
  Total current liabilities .............................     1,061,049          933,828
                                                            -----------      -----------

Stockholders' equity:
Preferred stock, par value $.01 per share, authorized                                 --
   2,000,000 shares; none issued
Common stock, par value $.01 per share,
   authorized 15,000,000 shares; issued and
   outstanding 6,727,139 shares at March 31, 1997
   and 6,761,612 shares at September 30, 1996 ...........        67,271           67,616
Additional paid-in capital ..............................    44,303,450       44,926,502
Retained earnings (deficit) .............................    (3,495,797)      (6,678,476)
Unrealized gains on market value of securities (Note B) .     2,790,724        1,816,903
                                                            -----------      -----------
  Total stockholders' equity ............................    43,665,648       40,132,545
                                                            -----------      -----------

Total liabilities and stockholders' equity ..............   $44,726,697      $41,066,373
                                                            ===========      ===========

</TABLE>


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



                                     Page 3

<PAGE>   4



                            ADVANCED MAGNETICS, INC.

<TABLE>
                             STATEMENT OF OPERATIONS
                 FOR THE THREE-MONTH AND SIX-MONTH PERIODS ENDED
                             MARCH 31, 1997 AND 1996
                                   (Unaudited)
<CAPTION>

                                         Three-Month Period Ended March 31,    Six-Month Period Ended March 31,
                                         ----------------------------------    --------------------------------
                                               1997                1996              1997            1996
                                               ----                ----              ----            ----
<S>                                        <C>                <C>                <C>             <C>        
Revenues:                                                                    
   License fees ......................     $        --        $        --        $ 5,500,000     $        --
   Royalties .........................          95,904             75,000            220,904         150,000
   Product sales .....................         209,793             12,762            876,255          12,762
   Interest, dividends and net gains                                         
     and losses on sales of securities       1,058,895            388,307          1,805,341         840,166
                                           -----------        -----------        -----------     -----------
        Total revenues ...............       1,364,592            476,069          8,402,500       1,002,928
                                                                             
Cost and expenses:                                                           
                                                                             
   Cost of product sales .............          33,139              2,550            176,335           2,550
                                                                             
   Research and development expenses .       1,956,700          2,516,746          4,253,276       4,677,306
                                                                             
   Selling, general and administrative                                       
     expenses ........................         469,027            394,986            790,210         685,971
                                           -----------        -----------        -----------     -----------
        Total costs and expenses .....       2,458,866          2,914,282          5,219,821       5,365,827
                                           -----------        -----------        -----------     -----------
                                                                             
   Income (loss) before provision for                                        
      income taxes ...................      (1,094,274)        (2,438,213)         3,182,679      (4,362,899)
   Income tax provision (benefit) ....              --                 --                 --              --
                                           -----------        -----------        -----------     -----------
                                                                             
Net income (loss) ....................      (1,094,274)        (2,438,213)         3,182,679      (4,362,899)
                                           ===========        ===========        ===========     ===========
                                                                             
                                                                             
Net income (loss) per share ..........     $     (0.16)       $     (0.36)       $      0.47     $     (0.65)
                                                                             
Weighted average number of common                                            
     and common equivalent shares ....       6,738,211          6,765,007          6,828,911       6,760,299
                                           -----------        -----------        -----------     -----------
                                                                             
</TABLE>
                                                                   

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



                                     Page 4

<PAGE>   5



                            ADVANCED MAGNETICS, INC.

<TABLE>
                             STATEMENT OF CASH FLOWS
                         FOR THE SIX-MONTH PERIODS ENDED
                             MARCH 31, 1997 AND 1996
                                   (Unaudited)


<CAPTION>

                                                                   Six-Month Periods Ended
                                                                            March 31,
                                                             -----------------------------------

                                                                  1997                 1996
                                                                  ----                 ----
<S>                                                          <C>                   <C>         
Cash flows from operating activities:
Cash received from customers ............................    $  6,379,265          $  1,277,472
Cash paid to suppliers and employees ....................      (4,530,951)           (5,347,094)
Dividends and interest received .........................         832,734             1,016,834
Income taxes paid .......................................              --               (20,000)
                                                             ------------          ------------

Net cash provided by (used in) operating activities .....       2,681,048            (3,072,788)

Cash flows from investing activities:
Proceeds from sales of securities .......................       6,094,377             7,609,264
Proceeds from U.S. Treasury Notes maturing ..............              --             9,796,348
Purchase of securities ..................................      (6,669,715)           (1,559,320)
Capital expenditures ....................................        (140,086)             (322,230)
                                                             ------------          ------------

Net cash provided by (used in) investing activities .....        (715,424)           15,524,062
                                                             ------------          ------------

Cash flows from financing activities:
Proceeds from issuances of common stock .................          26,446               110,650
Purchase of treasury stock ..............................        (649,843)                   --
                                                             ------------          ------------

Net cash provided by financing activities ...............        (623,397)              110,650
                                                             ------------          ------------

Net increase (decrease) in cash and cash equivalents ....       1,342,227            12,561,924

Cash and cash equivalents at beginning of the period ....      10,805,842             1,066,419
                                                             ------------          ------------

Cash and cash equivalents at end of the period ..........    $ 12,148,069          $ 13,628,343
                                                             ============          ============
</TABLE>



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




                                     Page 5

<PAGE>   6



                            ADVANCED MAGNETICS, INC.

<TABLE>
                          RECONCILIATION OF NET INCOME
                  TO NET CASH PROVIDED BY OPERATING ACTIVITIES
                         FOR THE SIX-MONTH PERIODS ENDED
                             MARCH 31, 1997 AND 1996
                                   (Unaudited)


<CAPTION>
                                                                           Six-Month Periods
                                                                             Ended March 31,
                                                                      ----------------------------
                                                                         1997            1996
                                                                         ----            ----    

<S>                                                                   <C>            <C>         
Net income (loss) ................................................... $ 3,182,679    $(4,362,899)
                                                                      -----------    -----------

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

Depreciation and amortization .......................................     542,730        513,699
Accretion of U.S. Treasury Notes discount ...........................     (17,736)       (14,425)
Decrease (increase) in accounts receivable ..........................    (104,648)     1,263,862
(Increase) decrease in prepaid expenses .............................    (164,616)      (125,899)
(Decrease) increase in accounts payable and accrued expenses ........     127,221       (321,436)
(Decrease) in income taxes payable ..................................          --        (20,000)

Net realized (gains) losses on sales of securities ..................  (1,018,878)        41,973

(Increase) decrease in inventories ..................................     134,296        (47,663)
                                                                      -----------    -----------

Total adjustments ...................................................    (501,631)     1,290,111
                                                                      -----------    -----------

Net cash provided by (used in) operating activities ................. $ 2,681,048    $(3,072,788)
                                                                      ===========    ===========

</TABLE>


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

                                     Page 6


<PAGE>   7



                            ADVANCED MAGNETICS, INC.

                          NOTES TO FINANCIAL STATEMENTS
                                 MARCH 31, 1997


A.       SUMMARY OF ACCOUNTING POLICIES.

         BUSINESS
         --------
         Founded in November 1981, Advanced Magnetics, Inc., a Delaware
corporation (the "Company"), is a biopharmaceutical company engaged in the
development and manufacture of compounds utilizing the Company's core
proprietary colloidal superparamagnetic particle technology for magnetic
resonance imaging ("MRI") and for polysaccharide directed delivery systems. The
initial products developed by the Company are diagnostic imaging agents for use
in conjunction with MRI to aid in the diagnosis of cancer and other diseases. In
therapeutics, the Company is developing targeted drug delivery platforms for the
treatment of organ-specific diseases.

         The accompanying financial statements are unaudited and in the opinion
of management, all adjustments necessary for a fair presentation of such
financial statements have been recorded. Such adjustments include normal
recurring items.

         Certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted. The preparation of financial
statements in conformity with generally accepted accounting principles requires
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities and disclosure of contingent assets and liabilities at
the date of the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from those
estimates. The year-end balance sheet data was derived from audited financial
statements, but does not include disclosures required by generally accepted
accounting principles. It is suggested that these interim financial statements
be read in conjunction with the Company's most recent Form 10-K and Annual
Report as of September 30, 1996.

B.       MARKETABLE SECURITIES.


<TABLE>
         The cost and market value of the Company's marketable securities
portfolio are as follows:

<CAPTION>
                                            March 31, 1997           September 30, 1996
                                       ------------------------   -------------------------

                                           Cost      Fair Value       Cost      Fair Value
                                       -----------  -----------   -----------   -----------

<S>                                    <C>          <C>           <C>           <C>        
U. S. government securities
    Due in one year or less            $ 7,505,244  $ 7,488,300   $ 7,510,203   $ 7,481,250
    Due after one through five years     7,415,532    7,321,876     7,392,785     7,312,500


Preferred stock                          5,398,542    7,610,000     3,062,404     3,145,029

Common stock                             2,746,900    3,436,766     3,488,874     5,332,390
                                       -----------  -----------   -----------   -----------

                                       $23,066,218  $25,856,942   $21,454,266   $23,271,169
                                       ===========  ===========   ===========   ===========
</TABLE>





                                     Page 7




<PAGE>   8



C.       INCOME TAX

         There was no income tax provision for the six-month period ended March
31, 1997 due to a net operating loss carry-forward for the period. There was no
income tax provision for the six-month period ended March 31, 1996 due to an
operating loss for the period

D.       LEGAL PROCEEDINGS

         The Company and certain of its officers were sued in an action in the
United States District Court for the District of Massachusetts on September 3,
1992. The plaintiff, a former consultant to the Company, claims that he was
incorrectly omitted as an inventor or joint inventor on certain of the Company's
patents and on pending applications, and seeks injunctive relief and unspecified
monetary damages. The plaintiff filed a related case in the Superior Court of
the Commonwealth of Massachusetts. The Superior Court has dismissed most of the
claims on summary judgment. While the final outcome of these actions cannot be
determined, the Company believes that the plaintiff's claims are without merit
and intends to defend the actions vigorously.

E.       EARNINGS PER SHARE

         Effective September 30, 1998, the Company will adopt Statement of
Financial Accounting Standards No. 128 (SFAS 128) "Earnings per Share" which
will require the disclosure of Basic Earnings per Common Share and Diluted Basic
Earnings per Common Share for all periods presented. SFAS 128 would not have a
material impact for any periods presented.



                                     Page 8




<PAGE>   9




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

OVERVIEW

         Since its inception in November 1981, Advanced Magnetics, Inc. (the
"Company") has focused its efforts on developing its core superparamagnetic iron
oxide particle technology. In recent years, the Company's efforts have been
focused primarily on the development of MRI contrast agents and, to a lesser
extent, on the development of a drug delivery platform that targets therapeutics
to the liver. The Company has funded its operations with cash from license fees,
royalties, sales of its products, the proceeds of financings, income earned on
invested cash and fees from contract research performed for third parties. The
Company's long-term viability and growth will depend on the successful
commercialization of products resulting from its research activities. Among
other things, successful commercialization of the Company's products will
require obtaining necessary governmental approvals in a timely manner,
attracting and retaining key employees and responding to technological changes
in the marketplace.

         The Company's operating results may continue to vary significantly from
quarter to quarter or from year to year depending on a number of factors,
including: (i) the timing of payments from corporate partners; (ii) the
introduction of new products; (iii) the timing and size of orders from
customers; (iv) the general level of acceptance of the Company's products; and
(v) increases or decreases in, and timing of, research and development, clinical
trials and other expenses. Revenue or profits in any period will not necessarily
be indicative of results in subsequent periods and there can be no assurance
that the Company will achieve consistent profitability or that revenue growth
will occur in the future.

         A substantial portion of the Company's expenses consists of research
and development expenses. The Company expects its research and development
expenses to increase as it funds additional clinical trials and associated
toxicology and pharmacology studies and devotes resources to developing
additional contrast agents and targeted drug delivery platforms for the
treatment of organ-specific diseases.

         The discussion in this Item 2 contains some forward looking statements
which involve certain risks and uncertainties, including statements related to
expenditures on research and development, liquidity and capital resources and
capital expenditures. The Company's actual results may differ significantly from
those stated in any forward-looking statements. Factors that may cause such
differences include, but are not limited to, those relating to the timing and
results of U. S. Food and Drug Administration ("FDA") action, delays in
arrangements with clinical investigators, uncertainties relating to results of
clinical trials and product development and other risks identified in the
Company's Form 10-K for the year ended September 30, 1996 and in the Company's
other filings with the Securities and Exchange Commission.


RESULTS OF OPERATIONS FOR THE QUARTER ENDED MARCH 31, 1997 AS COMPARED TO THE
- -----------------------------------------------------------------------------
QUARTER ENDED MARCH 31, 1996.
- -----------------------------

REVENUES
- --------

         Total revenues for the second fiscal quarter ended March 31, 1997 were
$1,364,592 compared to $476,069 for the second fiscal quarter ended March 31,
1996. The Company's revenues historically consist primarily of license fees,
royalties on products sold by licensees, direct sales of products and investment
income. The increase in revenues in the second quarter ended March 31, 1997
compared to the second fiscal quarter ended March 31, 1996 resulted primarily
from an increase in both product sales and investment income and gains on the
sale of securities.




                                     Page 9




<PAGE>   10



         The Company accounts for royalty revenue based on estimated product
sales by licensees for the applicable time period. Royalties of $95,904 for the
second fiscal quarter ended March 31, 1997 reflect the estimated product sales
by our licensees during this period.

         Product sales for the second fiscal quarter ended March 31, 1997 were
$209,793 compared to $12,762 for the second fiscal quarter ended March 31,1996
due to sales of new product in the United States.

         Interest, dividends and gains and losses on sales of securities
resulted in revenues of $1,058,895 for the second fiscal quarter ended March 31,
1997 compared to $388,307 for the second fiscal quarter ended March 31, 1996.
The increase compared to the fiscal quarter ended March 31, 1996 is primarily
the result of a net gain on sales of securities of $657,352 for the second
fiscal quarter ended March 31, 1997 compared to a net loss of $27,272 on sales
of securities in the second fiscal quarter ended March 31, 1996.

COSTS AND EXPENSES

         Research and development expenses for the second fiscal quarter ended
March 31, 1997 were $1,956,700 compared to $2,516,746 for the second fiscal
quarter ended March 31, 1996. The decrease was due primarily to lower costs
associated with clinical trials. Selling, general and administrative expenses
were $469,027 for the second fiscal quarter ended March 31, 1997 compared to
$394,986 for the second fiscal quarter ended March 31, 1996. The increase of
$74,041 was primarily related to increased costs for product insurance, now that
the Company has received FDA approval for two products.

         The Company incurred costs of $33,139 for product sold in the quarter
ended March 31, 1997 compared to $2,550 for the second fiscal quarter ended
March 31, 1996

INCOME TAXES

         There was no income tax provision for the second fiscal quarter ended
March 31, 1997 due to an operating loss for the period. There was no income tax
provision for the second fiscal quarter ended March 31, 1996 due to an operating
loss for the period.

EARNINGS

         For the reasons stated above, there was a net loss of $1,094,274 or
$(0.16) per share for the quarter ended March 31, 1997 compared to a net loss of
$2,438,213 or $(0.36) per share for the second fiscal quarter ended March 31,
1996. SFAS 128 would not have a material impact for any periods presented.





                                     Page 10




<PAGE>   11



RESULTS OF OPERATIONS FOR THE SIX MONTHS ENDED MARCH 31, 1997 AS COMPARED TO 
- ---------------------------------------------------------------------------- 
THE SIX MONTHS ENDED MARCH 31, 1996
- -----------------------------------

REVENUES
- --------

         Total revenues for the six-month period ended March 31, 1997 were
$8,402,500 compared to $1,002,928 for the six-month period ended March 31, 1996.

         There were license fee revenues of $5,500,000 for the six-month period
ended March 31, 1997 compared to no license fee revenues for the six-month
period ended March 31, 1996. The Company received a non-refundable $5,000,000
license fee on October 15, 1996 from Berlex Laboratories, Inc. ("Berlex") as a
result of Berlex's market launch of the Company's Feridex I.V.(R)MRI contrast
agent in the United States. The Company also received approval from the FDA for
GastroMARK(R)on December 6, 1996 and received a milestone payment of $500,000
from its marketing partner Mallinckrodt Medical, Inc. There were no license fee
revenues for the six-month period ended March 31, 1996.

         Royalties for the six-month period ended March 31, 1997 were $220,904
compared with royalties for the six-month period ended March 31, 1996 of
$150,000 relating to estimated product sales in Europe by Guerbet S.A. of the
Company's Feridex I.V., and GastroMARK MRI contrast agents. The increase in
royalties is associated with increased sales in the United States now that the
Company has received FDA approval for both products.

         Product sales for the six-month period ended March 31, 1997 were
$876,255 compared to $12,762 for the six-month period ended March 31, 1996. This
increase reflects the initial product launch in the United States and Canada of
both Feridex I.V. and GastroMARK.

         Interest, dividends and gains and losses on sales of securities
resulted in revenues of $1,805,341 for the six-month period ended March 31, 1997
compared to $840,166 for the six-month period ended March 31, 1996. The increase
compared to the six-month period ended March 31, 1996 is primarily the result of
a net gain on sales of securities of $1,018,878 for the six-month period ended
March 31, 1997 compared to a net loss of $41,972 for the six-month period ended
March 31, 1996.

COSTS AND EXPENSES
- ------------------

         The cost of product sales for the six-month period ended March 31, 1997
was $176,335 compared to $2,550 for the six-month period ended March 31, 1996.
The cost of product sales for the six-month period ended March 31, 1997 related
primarily to the increased sales for the product launch of the Company's two
products in the United States and Canada. The cost of product sales for both
six-month periods was 20% of product sales. Research and development expenses
for the six-month period ended March 31, 1997 were $4,253,276 compared to
$4,677,306 for the same period in 1996, due primarily to the lower costs
associated with clinical trials. Selling, general and administrative expenses
increased 15% to $790,210 for the six-month period ended March 31, 1997 from
$685,971 for the six-month period ended March 31, 1996. The increase was
primarily due to expenses for insurance on product sales.





                                     Page 11




<PAGE>   12



 INCOME TAXES

         There was no income tax provision for the six-month period ended March
31, 1997 due to a net operating loss carry-forward for the period. There was no
income tax provision for the six-month period ended March 31, 1996 due to an
operating loss for the period.


EARNINGS

         For the reasons stated above, there was net income for the six-month
period ended March 31, 1997 of $3,182,679 or $0.47 per share compared to a net
loss of $4,362,899 or $(0.65) per share for the six-month period ended March 31,
1996.

LIQUIDITY AND CAPITAL RESOURCES

         At March 31, 1997, the Company's cash and cash equivalents totaled
$12,148,069 compared with $10,805,842 at September 30, 1996. In addition, the
Company had marketable securities of $25,856,942 at March 31, 1997 as compared
to $23,271,169 on September 30, 1996. Net cash provided by operating activities
was $2,681,048 in the six-month period ended March 31, 1997 compared to net cash
used in operating activities of $3,072,788 in the six-month period ended March
31, 1996. Cash used in investing activities was $715,424 for the six-month
period ended March 31, 1997 compared to $15,524,062 provided by investing
activities in the six-month period ended March 31, 1996. Cash provided by
investing activities in the six-month period ended March 31, 1997 included the
proceeds of $6,094,377 from the sale of marketable securities. Offsetting these
proceeds was the purchase of marketable securities of $6,669,715 in the
six-month period ended March 31, 1997. Cash used in financing activities in the
six-month period ended March 31, 1997 was $623,397 compared to $110,650 provided
by financing activity in the six-month period ended March 31, 1996. Cash used in
financing activities in the fiscal six-month period ended March 31, 1997
included $649,843 for the purchase of the Company's stock on the open market. In
May 1996, the Board of Directors authorized the purchase of up to 250,000 shares
of the Company's common stock on the open market at prevailing market prices.
The Company purchased 20,000 shares for $311,215 in the first quarter ended
December 31, 1996 and 22,500 shares for $338,628 in the second quarter ended
March 31, 1997.

         Capital expenditures in the six-month period ended March 31, 1997 were
$140,086 compared to $322,230 in the six-month period ended March 31, 1996. This
reflects a continuing upgrade to existing property, plant and equipment. The
Company has no current commitment for any significant expenditures on property,
plant and equipment. The Company expects that expenditures for research and
development for the remainder of fiscal 1997 will increase due to human clinical
trials for the Company's targeted delivery platforms.

         Management believes that funds for future needs can be generated from
existing cash balances, cash generated from investing activities and cash
generated from operations. In addition, the Company will consider from time to
time various financing alternatives and may seek to raise additional capital
through equity or debt financing or to enter into corporate partnering
arrangements. There can be no assurance, however, that such funding will be
available on terms acceptable to the Company, if at all.




                                     Page 12




<PAGE>   13





P
ART II. OTHER INFORMATION


ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

         On February 4, 1997, the Company held its Annual Meeting of
Stockholders. At the meeting, the stockholders acted upon the following
proposals: (i) election of directors and (ii) approval of the 1997 Employee
Stock Purchase Plan. All of the above matters were approved by the stockholders.

         Votes "FOR" represent affirmative votes and do not include abstentions
or broker non-votes. In cases where a signed proxy was submitted without
designation, the shares represented by the proxy were voted "FOR" each proposal
in the manner described in the Proxy Statement. On the record date (December 16,
1996), 6,796,318 shares of the Company's common stock were issued and
outstanding.


<TABLE>

         Voting results were as follows:

<CAPTION>
                     Matter                      For       Against   Withheld   Abstain
                     ------                      ---       -------   --------   -------

<S>                                           <C>          <C>          <C>     <C>                        
1.  Election of Directors
       Thomas Coor                            5,812,212    23,200       N/A       N/A
       Jerome Goldstein                       5,812,712    22,700       N/A       N/A
       Leslie Goldstein                       5,812,212    23,200       N/A       N/A
       Richard L McIntire                     5,812,812    22,600       N/A       N/A
       Edward B. Roberts                      5,812,812    22,600       N/A       N/A
       Roger E. Travis                        5,812,312    23,100       N/A       N/A
       George M. Whitesides                   5,812,812    22,600       N/A       N/A

2.  Approval of the 1997 Employee Stock
       Purchase Plan                          5,707,602    86,075       N/A     41,735

</TABLE>






ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

         Exhibit 11        Statement re:  Computation of per share earnings

         Exhibit 27.1      Financial Data Schedule (EDGAR filing only)

         The Company did not file any current reports on Form 8-K during the
quarter ended March 31, 1997.




                                     Page 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.







                             ADVANCED MAGNETICS, INC.


Date      May 15, 1997    By  /s/ Jerome Goldstein
          ------------        -------------------------------------------------
                              Jerome Goldstein, President,
                              Treasurer and Chairman of the Board of Directors


Date      May 15, 1997    By  /s/ James A. Matheson
         --------------       -------------------------------------------------
                              James A. Matheson, Vice President
                              and Principal Accounting Officer





                                     Page 14








<PAGE>   1





                            ADVANCED MAGNETICS, INC.


<TABLE>


                  Exhibit 11 - Statement Re Computation of Per
                   Share Earnings Attached to and made part of
                          Part II of Form 10-Q for the
   Three-Month and Six-Month Periods Ended March 31, 1997 and 1996 (unaudited)

<CAPTION>


                                                Three-Month Periods             Six-Month Periods
                                                  Ended March 31,                Ended March 31,
                                                  ---------------                ---------------
                                                 1997           1996            1997         1996
                                                 ----           ----            ----         ----

<S>                                           <C>            <C>             <C>           <C>      
Weighted average number of shares
   issued and outstanding ...............     6,738,211      6,765,007       6,748,239     6,760,299

Assumed exercise of options reduced
   by the number of shares which
   could have been purchased with
   the proceeds of those options ........            --             --          80,672            --


As adjusted .............................     6,738,211      6,765,007       6,828,911     6,760,299
                                              =========      =========       =========     =========

</TABLE>




                                     Page 15







<TABLE> <S> <C>

<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM 2ND QUARTER
1997 FORM 10-Q.
</LEGEND>
       
<S>                             <C>
<PERIOD-TYPE>                   6-MOS
<FISCAL-YEAR-END>                          SEP-30-1997
<PERIOD-START>                             OCT-01-1996
<PERIOD-END>                               MAR-31-1997
<CASH>                                      12,148,069
<SECURITIES>                                25,856,942
<RECEIVABLES>                                  253,883
<ALLOWANCES>                                         0
<INVENTORY>                                     47,870
<CURRENT-ASSETS>                            38,602,614
<PP&E>                                      12,690,535
<DEPRECIATION>                               6,762,309
<TOTAL-ASSETS>                              44,726,697
<CURRENT-LIABILITIES>                        1,061,049
<BONDS>                                              0
<PREFERRED-MANDATORY>                                0
<PREFERRED>                                          0
<COMMON>                                        67,271     
<OTHER-SE>                                           0
<TOTAL-LIABILITY-AND-EQUITY>                44,726,697
<SALES>                                        876,255
<TOTAL-REVENUES>                             8,402,500
<CGS>                                          176,335
<TOTAL-COSTS>                                5,219,821
<OTHER-EXPENSES>                                     0
<LOSS-PROVISION>                                     0
<INTEREST-EXPENSE>                                   0
<INCOME-PRETAX>                              3,182,679
<INCOME-TAX>                                         0
<INCOME-CONTINUING>                                  0
<DISCONTINUED>                                       0
<EXTRAORDINARY>                                      0
<CHANGES>                                            0
<NET-INCOME>                                 3,182,679
<EPS-PRIMARY>                                     0.47
<EPS-DILUTED>                                        0
        

</TABLE>