Water-soluble polymeric adhesive compositions and their use as delivery vehicles for carrying therapeutic agents on implantable devices, such as vascular grafts, are disclosed. Use of drug-coated vascular grafts is demonstrated for delivery of the therapeutic agents in vivo, thereby inhibiting restenosis or neointimal hyperplasia of the vascular graft and inhibiting infection at the vascular graft site. Methods of forming the adhesive and making the coated vascular grafts are also disclosed.