1

                                    FORM 10-Q
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

(Mark One)

(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                  to

Commission file number  1-11394

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

                     Delaware                                 95-3863205
         (State or other jurisdiction of                   (I.R.S. Employer
         incorporated or organization)                      Identification No.)

         1238 Anthony Road, Burlington, North Carolina            27215
--------------------------------------------------------------------------------
          (Address of principal executive offices)              (Zip Code)

Registrant's telephone number including area code:            (910) 226-6311
--------------------------------------------------------------------------------

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

The number of shares of Common Stock, $.15 par value, outstanding as of November
1, 1995 was 10,233,320.





<PAGE>








                                  EDITEK, INC.

                                      INDEX

<TABLE>
<CAPTION>
                                                                                    Page

Part I            Financial Information:
<S>              <C>                                                               <C>

                  Item 1:

                           Balance Sheets - September 30, 1995 (Unaudited)
                           and December 31, 1994 ....................................  3

                           Statements of Operations - Nine Months
                           Ended September 30, 1995 and 1994 and Three
                           Months Ended September 30, 1995 and 1994 (Unaudited) .....  5
                           Statements of Cash Flows - Nine Months
                           Ended September 30, 1995 and 1994 (Unaudited) ............  6

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

                  Item 2:

                           Management's Discussion and Analysis of
                           Financial Condition and Results of Operations ............  9

Part II           Other Information ................................................. 16
                           Signatures ............................................... 17
</TABLE>

<PAGE>

PART I. FINANCIAL INFORMATION

                                       EDITEK, Inc.

                                      BALANCE SHEETS
<TABLE>
<CAPTION>


                                                            September 30     December 31
                                                                1995            1994
                                                             (Unaudited)
                                                           --------------------------------
                                                                   (In Thousands)
<S>                                                        <C>                   <C>    

Assets
Current assets
   Cash and cash equivalents                                         $ 416           $1,105
                                                                       
   Accounts receivable
         Trade, less allowance for
         doubtful accounts ($52,000 - 1995,
          $204,000 - 1994)                                           1,223             737
         Other                                                          85             106
   Inventories:
         Raw Materials                                                 456             532
         Work in process                                                63              64
         Finished goods                                                349             257
                                                           --------------------------------
                                                                       868             853

   Prepaid expenses and other                                          741             272
                                                           --------------------------------


         Total current assets                                        3,333           3,073



Equipment and improvements
    Furniture and equipment                                          7,230           5,689
    Leasehold improvements                                             282           1,692
                                                           --------------------------------

                                                                     7,512           7,381
    Less accumulated depreciation
         and amortization                                          (6,704)         (6,326)
                                                           --------------------------------

                                                                       808           1,055


Goodwill                                                             3,241           3,247

Other assets                                                             -               3


                                                           --------------------------------


                                                                    $7,382           $7,378
                                                           ================================
</TABLE>




                                                         3





<PAGE>

                                        EDITEK, Inc.

                                       BALANCE SHEETS
                                         (Continued)
<TABLE>
<CAPTION>


                                                                September 30    December 31
                                                                    1995            1994
                                                                 (Unaudited)
                                                               -------------------------------
                                                                       (In Thousands)
<S>                                                                 <C>               <C>     

Liabilities and stockholders' equity
Current liabilities
   Line of credit                                                       $    -          $ 850             
                                                                            
   Accounts payable
                                                                         1,139          1,105
   Accrued expense
                                                                           333            347
   Deferred revenues
                                                                            13             39
   Current  portion of long-term debt
                                                                            82             95
   Current portion of capital lease
                                                                             -             23
                                                               -------------------------------

         Total current liabilities
                                                                         1,567          2,459


Notes payable
                                                                             -             63


Stockholders' equity
   Preferred Stock--authorized 600,000
         shares; no shares isssued or
         outstanding
                                                                             -              -
   CommonStock,  $.15 par value;  authorized  -  20,000,000  
         shares;  issued and outstanding - 10,23,814 shares 
         in 1995 and 8,075,339 shares in 1994
                                                                         1,532          1,211
   Additional paid-in capital
                                                                        33,631         30,132
   Accumulated deficit
                                                                      (29,172)       (26,382)
                                                               -------------------------------


                                                                         5,991          4,961


   Less: Note receivable from officer
                                                                         (100)          (100)
         Treasury stock
                                                                          (76)            (5)
                                                               -------------------------------

        Total stockholders' equity
                                                                         5,815          4,856



                                                                             
                                                                        $7,382          $7,378
                                                               ===============================
</TABLE>

See notes to financial statements.



                                                             4




<PAGE>


                                        EDITEK, Inc.

                                STATEMENTS OF OPERATIONS

                                        (Unaudited)

<TABLE>
<CAPTION>


                                                                    Nine Months Ended                Three Months Ended
                                                              September 30     September 30     September 30     September 30
                                                                  1995             1994             1995             1994
                                                         --------------------------------------------------------------------
                                                                  (In Thousands)                     (In Thousands)
                                                                                      
<S>                                                     <C>                    <C>             <C>               <C>    

Revenues

   Product sales                                                   $5,243           $4,768           $1,833           $1,637

   Royalties and fees                                                 234              100               74               50

   Interest and other income                                          186              183                5              111

                                                         --------------------------------------------------------------------

                                                                    5,663            5,051            1,912            1,798


Cost of sales                                                       4,800            4,487            1,619            1,732

                                                         --------------------------------------------------------------------

          Gross profit                                                863              564              293               66


Operating expenses
   Selling, general and administrative                              2,963            2,428            1,024              842
                                                                                    
   Research and development                                           669              537              242              191
                                                                                     
   Interest                                                            21               15                1                9

                                                         --------------------------------------------------------------------

                                                                    3,653            2,980            1,267            1,042
                                                                                                 


                                                         --------------------------------------------------------------------

            Net loss                                             $(2,790)         $(2,416)            $(974)           $(976)
                                                         ====================================================================



Loss per common share                                             $(0.28)          $(0.34)           $(0.10)          $(0.13)
                                                         ====================================================================



Weighted average number of common shares outstanding           9,915,427       7,174,160          9,321,610       7,417,837
                                                         ====================================================================

</TABLE>




See notes to financial statements.


                                                       5




<PAGE>

                                            EDITEK, Inc.

                                  STATEMENTS OF CASH FLOWS (Unaudited)


<TABLE>
<CAPTION>
                                                                                   Nine Months Ended
                                                                              September 30    September 30
                                                                                   1995           1994
                                                                             --------------------------------
                                                                                   (In Thousands)
<S>                                                                         <C>                 <C>

Operating activities
Net loss                                                                           $(2,790)        ($2,416)
                                                                               
   Adjustments to reconcile net loss to net 
    cash used in operating activities:
      Depreciation and amortization                                                   501             432
                                                                                      
      Changes in operating  assets & liabilities 
       net of effects from purchase of
         PDLA & Bioman:
             Accounts receivable                                                    (355)             (55)
                                                                                    
             Inventories                                                              (2)            (123)
                                                                                      
             Prepaid expenses & other                                               (462)             (62)
                                                                                    
             Accounts payable and accrued liabilities                               (146)            (100)
                                                                                    
             Deferred revenues                                                       (26)             (36)
                                                                                     
             Leases payable                                                          (23)            (26)
                                                                          --------------------------------

Net cash used in operating activities                                             (3,303)          (2,386)


Investing activities
    Purchases of equipment & improvements                                           (108)           (445)
                                                                                    
    Cash acquired from PDLA acquisition
                                                                                        -              89
    Cash used for BIOMAN acquisition
                                                                                     (37)               -
                                                                          --------------------------------

Net cash used in investing activities                                               (145)            (356)
                                                                                    


Financing activities
    Payments on Debt                                                                (945)             305
                                                                                    
    Proceeds from borrowings
                                                                                       16               -
    Proceeds from issuance of stock for:
      Employee stock purchase plan                                                     21              19
                                                                                       
      Exercise of stock options and warrants                                          193              47
                                                                                      
      Private placements                                                            3,715             824
                                                                                    
      Costs related to private placements                                           (231)             (38)
                                                                                    
   Conversion of note payable to common stock
                                                                                       61               -
   Treasury Stock
                                                                                     (71)               -
                                                                          --------------------------------

Net cash provided by financing activities                                           2,759           1,157
                                                                                    
                                                                          --------------------------------

(Decrease) in cash and cash equivalents                                                                
                                                                                    $(689)        $(1,585)
                                                                                   

Cash and cash equivalents at beginning of period                                   $1,105           $2,560
                                                                          --------------------------------

Cash and cash equivalents at end of period                                           $416            $975
                                                                          ================================
</TABLE>

                                                            6

<PAGE>


                                  EDITEK, INC.

                          NOTES TO FINANCIAL STATEMENTS

                               September 30, 1995

NOTE A -- BASIS OF PRESENTATION

The accompanying  unaudited financial statements of EDITEK, Inc. (the "Company")
have been prepared in accordance with generally accepted  accounting  principles
for interim  financial  information  and with the  instructions to Form 10-Q and
Article  10 of  Regulation  S-X.  Accordingly,  they do not  include  all of the
information and footnotes required by generally accepted accounting  principles.
In the opinion of management,  all adjustments  (consisting of normal  recurring
accruals)  considered  necessary for a fair presentation of financial  condition
and results of operations  have been  included.  Operating  results for the nine
month period ended  September  30, 1995 are not  necessarily  indicative  of the
results that may be attained for the entire year. For further information, refer
to the  financial  statements  and footnotes  thereto  included in the Company's
annual report on Form 10-K for the year ended December 31, 1994.

Loss Per Share:  Loss per share amounts are based on the weighted average number
of shares of common stock  outstanding.  Common stock  equivalents have not been
included in the computation, as the effect would be anti-dilutive.

NOTE B -- ACQUISITION OF PRINCETON DIAGNOSTIC LABORATORIES OF
AMERICA, INC. ("PDLA")

The Company  acquired PDLA on February 11, 1994 by issuing 826,790 shares of its
common stock in exchange for all of the  outstanding  shares of PDLA stock.  The
total value of the exchange was  $3,876,000.  The  acquisition was accounted for
under the purchase  method of accounting  and the Company  recorded  goodwill of
$3,319,000. Additional shares of common stock were subsequently issued to former
major shareholders of PDLA through price protection agreements. The consolidated
results of operations  for the year ended  December 31, 1994 include the results
of the PDLA operations from February 12, 1994 to December 31, 1994.

NOTE C -- ACQUISITION OF BIOMAN PRODUCTS, INC. ("Bioman")

The Company acquired Bioman on June 1, 1995 in a transaction  accounted for as a
purchase of assets. The Company paid $140,000 Canadian for Bioman utilizing both
cash and common stock.


                                        7
<PAGE>



NOTE D -- DEBT

On August 15, 1989 the Company  entered  into a long-term  loan  agreement  with
North  Carolina  Biotechnology  Center  ("NCBC"),  a  state  funded,  non-profit
organization  whereby the Company  borrowed an aggregate of $125,000 to fund the
development cost of a test for Chlamydia,  a sexually  transmitted  disease. The
loan  originally  had an interest rate of seven and one half percent  (7.5%) per
annum with all  principal  and  interest  due on August 15,  1994.  The  Company
amended the loan  agreement on the due date and issued  16,100  shares of common
stock for  $62,000 of the loan.  The  remaining  principal,  $63,000,  now bears
interest at a rate of nine percent (9%) per annum.  This principal and interest,
which are due on August 16, 1996, are  convertible  into shares of common stock.
During the nine months ended September 30, 1995, the Company paid the $33,000 of
the remaining accrued interest on the original loan.

                                       8

<PAGE>


                                  EDITEK, INC.

                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                       CONDITION AND RESULTS OF OPERATIONS

Introduction

         The  Company  commenced  operations  in June 1983 and until  1986 was a
development  stage company.  The Company became engaged in the  manufacture  and
sale of  Conventional  Biodiagnostic  Products as a result of its acquisition of
Granite  Technological  Enterprises,  Inc. in June 1986.  The Company  began the
manufacture and sale of its EZ-SCREEN(R) diagnostic tests in 1985 and introduced
its patented  one-step  assays,  VERDICT(R) and RECON(R),  in 1993. On August 6,
1993, the Company formed diAGnostix,  inc. to market its agricultural diagnostic
products.  On February 11, 1994, the Company  completed the acquisition of PDLA,
which is now a wholly  owned  subsidiary  of the Company.  On June 1, 1995,  the
Company  acquired  Bioman.  The operations of Bioman are now part of diAGnostix,
inc. Since inception,  the Company has financed its working capital requirements
primarily from the sale of equity securities.

Nine Months Ended September 30, 1995 Compared to Nine Months Ended
September 30, 1994

         Total  revenues  for the nine  months  ended  September  30,  1995 were
$5,663,000  compared to total  revenues of $5,051,000  for the nine months ended
September 30, 1994.  Revenues from product sales and laboratory services for the
nine months ended  September 30, 1995 were  $5,243,000,  an increase of $475,000
compared to $4,768,000  for the same period in 1994.  These  increases  were the
result of the Company  recognizing for the full nine months in 1995 the revenues
from the  laboratory  services of PDLA as  compared  to only seven and  one-half
months in 1994.

         Substance abuse testing products and services ("Substance Abuse Testing
Products and Services") which are marketed through PDLA,  include  EZ-SCREEN and
VERDICT  on-site  tests,  the  laboratory  services  provided  by PDLA and other
ancillary  products for the detection of abused  substances.  Sales of Substance
Abuse Testing Products and Services for the nine months ended September 30, 1995
were  $4,063,000  compared to $3,739,000 for the nine months ended September 30,
1994.  The increase of $324,000 in sales was  primarily a result of increases in
sales  from  laboratory  services  of PDLA  for the  nine  month  period  ending
September 30, 1995. During the nine months ended September 30, 1994, the Company
realized  sales of $459,000 from  laboratory  services that were  transferred to
American  Medical  Laboratories,  Inc. ("AML") in January 1995 and, as such, are
not included in sales for the nine months ended September 30, 1995. Accordingly,
the actual increase in sales from Substance Abuse Testing Products and Services,
excluding those sales transferred to AML, was $783,000.

                                    9
<PAGE>


         Product  sales  include  sales  of  agricultural   diagnostic  products
consisting  of  EZ-SCREEN  test  kits (for  mycotoxin  detection,  drug  residue
surveillance,  etc.),  species  identification kits, other bioassay products and
third party  products.  These  products are marketed  through  diAGnostix,  inc.
Effective June 1, 1995, the Company acquired Bioman, an environmental diagnostic
company   which  sells  both  OEM  products  and  products   available   through
distribution  agreements with other diagnostic companies.  Bioman was previously
the Company's  distributor for Canada.  The Bioman products are marketed through
diAGnostix,  inc. Sales of products sold through diAGnostix,  inc. were $840,000
for the nine months ended September 30, 1995,  compared to $693,000 for the nine
months ended September 30, 1994. Sales from the former Bioman operations for the
four months ended September 30, 1995 offset a decrease in sales of the EZ-SCREEN
on-site  testing  products for the nine months  ended  September  30,  1995,  as
compared to the nine months ended September 30, 1994.

         Revenues generated from the shipment of products to the U.S. Department
of Defense  were  $37,000 for the nine months  ended  September  30,  1995.  The
Company had no such revenues during the nine months ended September 30, 1994.

         Revenues from contract manufacturing services were $16,000 for the nine
months  ended  September  30, 1995  compared to $110,000  during the nine months
ended September 30, 1994. This decrease was the result of delays in purchases by
a client company pending  product launch of the product  utilizing the component
produced by the Company.

         Microbiological and associated product sales were $287,000 for the nine
months ended  September 30, 1995 compared to $226,000 for these products  during
the same period in 1994.  This increase was the result of a price  increase to a
large purchaser of these products.

         Revenues from royalties and fees during the nine months ended September
30, 1995 were  $234,000  compared to $100,000  for the  corresponding  period in
1994.  This  increase was  primarily due to a payment made to the Company by the
landlord of the facility in New Jersey for renewing the lease for that  facility
and the  royalty  received  from AML of $59,000  pursuant to the  agreement  the
Company has with AML and  increases  in fees charged to the U.S.  Department  of
Defense for specific test  development.  Revenues from interest and other income
for the nine months ended September 30, 1995 were $186,000  compared to $183,000
for the nine months ended September 30, 1994.

         Gross  margins  from  the  sales  of  both  manufactured  and  products
purchased  for resale for the nine  months  ended  September  30,  1995 were 17%
compared to 19% of sales of these  products for the nine months ended  September
30,  1994.  This  decline  was due to the  comparative  decrease in sales of the
agricultural  diagnostic products and contract manufacturing services during the
nine months ended September 30, 1995.

                                 10
<PAGE>


         An increase in the number of samples  being  processed at PDLA resulted
in improved  gross  margins for  laboratory  services  for the nine months ended
September  30,  1995,  however,  as in the  same  period  in  1994,  the cost of
providing  laboratory  services  exceeded  revenue realized from these services.
Since a large amount of the costs of providing  laboratory services are fixed or
near fixed  costs,  the margins  from sales of  laboratory  services  are volume
dependent.

         Selling,  general and administration expenses for the nine months ended
September  30, 1995 were  $2,963,000,  as compared  to  $2,428,000  for the nine
months ended  September  30, 1994.  This  increase of $535,000 is primarily  the
result of increased sales and marketing  expenses  associated with the Substance
Abuse  Testing  Products  and Services  marketed  through  PDLA,  as well as the
overall increases in general expenditures resulting from the acquisition of PDLA
effective February 14, 1994.

         Research and development expenses incurred during the nine months ended
September  30, 1995 were  $669,000  as compared to $537,000  for the nine months
ended  September 30, 1994. This increase of $132,000 was primarily the result of
increased  personnel costs and expenses,  as well as increases in the work being
performed pursuant to the DOD contract.

         For the nine months ended September 30, 1995,  EDITEK incurred interest
expense of $21,000,  compared to interest expense of $15,000 incurred during the
nine months ended  September  30, 1994.  This increase was primarily a result of
the Company borrowing funds against its line of credit. The Company paid off the
balance of the line of credit during the nine months ended September 30, 1995.

         As a result  of the  above,  the net loss  for the  nine  months  ended
September 30, 1995 was  $2,790,000,  compared to the net loss of $2,416,000  for
the nine months ended September 30, 1994.

Three Months Ended September 30, 1995 compared to Three Months Ended
September 30, 1994

         Total  revenues  for the three  months  ended  September  30, 1995 were
$1,912,000,  compared to  $1,798,000  for the three months ended  September  30,
1994.  Revenues  from product sales were  $1,833,000  for the three months ended
September 30, 1995, as compared to $1,637,000 for the same period in 1994.

         Sales of Substance Abuse Testing  Products and Services were $1,382,000
for the three months ended  September 30, 1995,  compared to $1,323,000  for the
three months ended  September  30, 1994.  While this  represents  an increase of
$59,000,  the three month  period ended  September  30, 1994  includes  sales of
$165,000 of laboratory  services that were  transferred  to AML. As such,  those
sales are not included in product sales for the three months ended September 30,
1995. Accordingly, the actual increase in sales from

                               11
<PAGE>


Substance Abuse Testing Products and Services, excluding those sales transferred
to AML, was $224,000.

         Sales of products sold through  diAGnostix,  inc. were $354,000 for the
three months  ended  September  30, 1995,  as compared to $222,000 for the three
months ended September 30, 1994. This increase of $132,000 was the result of the
acquisition of Bioman effective June 1, 1995.

         Revenues from contract manufacturing services were $7,000 for the three
months ended  September  30, 1995,  compared to $19,000  during the three months
ended September 30, 1994.

         Microbiological and associated product sales were $90,000 for the three
months ended  September 30, 1995,  compared to $73,000 for these products during
the same period in 1994.  This increase was the result of a price  increase to a
large purchaser of these products.

         Revenues  from  royalties  and  fees  during  the  three  months  ended
September 30, 1995 were $74,000 compared to $50,000 for the corresponding period
in 1994.  This increase was  primarily due to the royalty  received from AML and
increases in fees charged to the U.S.  Department  of Defense for specific  test
development.

         Revenues  from  interest  and other  income for the three  months ended
September  30, 1995 were $5,000  compared to $111,000 for the three months ended
September  30,  1994.  During the three  months ended  September  30, 1994,  the
Company recovered certain debts owed by a customer of laboratory  services which
had previously been written off.

         Gross margins from the sales of both manufactured products and products
purchased for resale for the three months ended  September 30, 1995 were 9%, the
same as sales of these products for the three months ended September 30, 1994.

         An increase in the number of samples  being  processed at PDLA resulted
in improved  gross  margins for  laboratory  services for the three months ended
September  30,  1995.  However,  as in the  same  period  in  1994,  the cost of
providing  laboratory  services  exceeded  revenue realized from these services.
Since a large amount of the costs of providing  laboratory services are fixed or
near fixed  costs,  the margins  from sales of  laboratory  services  are volume
dependent.

         Selling, general and administration expenses for the three months ended
September 30, 1995 were $1,024,000, as compared to $842,000 for the three months
ended  September 30, 1994. This increase of $182,000 was primarily the result of
increased  sales and marketing  expenses  associated  with the  Substance  Abuse
Testing Products and Services marketed through PDLA.

                                   12
<PAGE>


         Research  and  development  expenses  incurred  during the three months
ended  September 30, 1995 were  $242,000,  as compared to $191,000 for the three
months ended  September  30, 1994.  This  increase of $51,000 was  primarily the
result of increased  personnel  costs and expenses,  as well as increases in the
work being performed pursuant to the DOD contract.

         For the three months ended September 30, 1995, EDITEK incurred interest
expense of $1,000,  compared to interest  expense of $9,000  incurred during the
three months ended September 30, 1994.

         As a result  of the  above,  the net loss for the  three  months  ended
September  30, 1995 was  $974,000,  compared to the net loss of $976,000 for the
three months ended September 30, 1994.

Material Changes in Financial Condition

         As of September 30, 1995, cash and cash equivalents  were $416,000,  as
compared to  $1,105,000  at December 31, 1994.  This  decrease was primarily the
result of the net loss of  $2,788,000  for the nine months ended  September  30,
1995.

         As of September 30, 1995, accounts receivable were $1,308,000, compared
to $843,000 at December  31,  1994.  This  increase  of  $465,000,  or 55%,  was
primarily the result of the acquisition of Bioman and increased sales during the
period  preceding  September  30,  1995,  as  compared  to the period  preceding
December 31, 1994.

         Inventories  were  $868,000,  or 2% higher,  at September  30, 1995, as
compared to $853,000 at December 31, 1994.

         Prepaid  expenses and other assets were $741,000 at September 30, 1995,
as  compared to $272,000 at  December  31,  1994.  This  increase of $469,000 is
primarily  the result of  $500,000  the Company  placed  into an escrow  account
towards the acquisition of MEDTOX  Laboratories,  Inc.  ("MEDTOX").  The Company
will forfeit the $500,000 if the  acquisition of MEDTOX does not occur solely as
a result of the Company  being  unsuccessful  in raising the funds  necessary to
consummate the acquisition.

         As of December  31,  1994,  the Company had an  outstanding  balance of
$850,000 on its line of credit. During the nine months ended September 30, 1995,
the Company repaid the total outstanding balance.

         As of September 30, 1995, the Company had a balance of accounts payable
of $1,139,000, compared to a balance of $1,105,000 at December 31, 1994.

         Accrued  expenses  were  $333,000 or 4% lower at September 30, 1995, as
compared to $347,000 at December 31, 1994.

                                          13
<PAGE>

         As described  more fully in the footnotes to the financial  statements,
the Company  entered  into a $125,021  loan  agreement  with the North  Carolina
Biotechnology Center (NCBC). The loan, plus accrued interest, was due August 14,
1994. On December 15, 1994, the Company and NCBC negotiated a loan  modification
extending the due date to August 14, 1996. In addition, NCBC has exercised their
right to convert 50%, or approximately  $62,000,  of the loan amount into 16,100
shares of the Company's  common stock.  Accordingly,  at September 30, 1995, the
Company had a balance of loan payable of $63,000.

Inflation

         Inflation  generally  affects  the  costs  incurred  by  EDITEK  in its
purchase of raw  materials,  as well as in certain  components  of its  selling,
general, and administrative  expenses.  The ability of EDITEK to increase prices
may be limited by competitive factors or contractual obligations.

Liquidity and Capital Resources

         Since its inception,  the working  capital  requirements of the Company
have been funded by cash received  from equity  investments  in the Company.  At
September 30, 1995, the Company had cash and cash  equivalents of $416,000.  The
Company has also put $500,000 in an escrow  account  towards the  acquisition of
MEDTOX.  The  Company is in the  process of raising up to $31 million to finance
the  acquisition  of MEDTOX and  provide  working  capital  to support  the post
acquisition  company.  If the acquisition of MEDTOX was not to occur solely as a
result of the Company not being able to raise  sufficient  capital to consummate
the acquisition, the Company will forfeit the $500,000 to MEDTOX.

         As of September 30, 1995,  the Company had not achieved a positive cash
flow from  operations.  Accordingly,  the  Company  relies on  available  credit
arrangements,  outside funding of research and development,  and continued sales
of its equity  securities to fund  operations  until a positive cash flow can be
achieved.  Management believes that it has taken, and is prepared to continue to
take, the actions  required to yield a positive cash flow from operations in the
future.

         The  Company  does  not  intend  to  rely  primarily  on  further  cost
reductions  in order to achieve a positive  cash flow.  The  Company has already
made a substantial  investment in research and  development  and  marketing.  It
believes the  appropriate  strategy for  capitalizing  on the investment made to
date is to  maintain,  and  later  expand,  its  current  level  of  operations,
including  research and development and marketing.  Therefore,  the Company plan
includes  (i)  continuing  to  aggressively  monitor  and  control  costs,  (ii)
increasing revenue from sales of the Company's products,  services, and research
and development contracts, (iii) raising additional capital through sales of its
securities,  as well as (iv) pursuing  synergistic  acquisitions to increase the
Company's critical mass. There can be no assurance that costs can be controlled,
revenues can be increased,

                                14
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financing may be obtained,  acquisitions successfully consummated, or that the
Company will be profitable.

         Through  October 31,  1995,  the Company has sold a total of  1,860,834
shares of common stock in seven separate private  transactions in 1995. The sale
of these 1,860,834 shares generated net proceeds of $3,427,000 to the Company.

                                 15

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ITEM 2   CHANGES IN SECURITIES.  Inapplicable

ITEM 3   DEFAULTS ON SENIOR SECURITIES.  Inapplicable

ITEM 4   SUBMISSION OF MATTERS TO A VOTE OF SECURITIES HOLDERS.  None

ITEM 5   OTHER INFORMATION


                                16

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                                   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.


Date:    November 10, 1995


                                            EDITEK, INC.

                                   By: /s/ James D. Skinner
                                       James D. Skinner, Chairman, President
                                       and Chief Executive Officer

                                   By: /s/ Peter J. Heath
                    Peter J. Heath, Vice President of Finance
                                       and Chief Financial Officer

                                   17


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