<PAGE>
                     SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D.C. 20549
                                  FORM 10-QSB

(Mark One)

 X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
   EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDING SEPTEMBER 30,
   1996.

   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
   EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM _____________ TO
   _______________.

Commission File No.:  33-43537

                             COVALENT GROUP, INC.

        (Name of Small Business Issuer as Specified in its Charter)

              NEVADA                            56-1668867
  (State or other jurisdiction of       (I.R.S. Employer Identification No.)
   incorporation or organization)


       One Glenhardie Corporate Center, 1275 Drummers Lane, Suite 201,
                         Wayne, Pennsylvania 19087
                 (Address of principal executive offices)

Issuer's telephone number: 610-975-9533

                FUTURE MEDICAL TECHNOLOGIES INTERNATIONAL, INC.
                          (Former Name of Company)

Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 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.           X Yes          No

State the number of shares outstanding of each of the issuer's classes
of common equity, as of the latest practical date November 1, 1996:

Common Stock, Par Value $.001                        11,602,909
-----------------------------                        ----------
          (Class)                                    Outstanding

     Transitional Small Business Disclosure Format:  Yes    No XX
<PAGE>

FORM 10-QSB


                          COVALENT GROUP, INC.


<TABLE>
<CAPTION>

                                INDEX




                                                              Page(s)
<S>  <C>                                                       <C>
PART I.   Financial Information

     Item 1.  Consolidated Financial Statements

          Balance Sheet - September 30, 1996 (Unaudited)       2 & 3

          Statements of Operations (Unaudited) - Nine
          Months Ended September 30, 1996 and 1995               4

          Statements of Cash Flows (Unaudited) - Nine 
          Months Ended September 30, 1996 and 1995               5

          Notes to Consolidated Financial Statements
          (Unaudited)                                          6 - 7

     Item 2.  Management's Discussion and Analysis of
              Financial Condition and Results of
              Operations                                       8 - 11

PART II.  Other Information                                     12

Signature Page                                                  13

/TABLE
<PAGE>

FORM 10-QSB         PART I - FINANCIAL INFORMATION


                         COVALENT GROUP, INC.
                     CONSOLIDATED BALANCE SHEET
                         SEPTEMBER 30, 1996
                             (Unaudited)


<TABLE>
<CAPTION>

<S> <S>                                              <C>
    ASSETS

CURRENT ASSETS
Cash and cash equivalents                            $ 2,007,502
Accounts receivable                                      515,369
Prepaid expenses                                          35,837
Due from related party                                    30,000
Note receivable                         (Notes 1 & 2)    250,000
Costs and estimated earnings in excess
  of related billings on uncompleted
  contracts                             (Note 1)       1,325,635
                                                       ---------
    TOTAL CURRENT ASSETS                               4,164,343
                                                       ---------
PROPERTY AND EQUIPMENT
Equipment                               (Note 1)         552,533
Furniture and fixtures                                    98,827
Demonstration model                                       43,267
                                                       ---------
                                                         694,627
Less accumulated depreciation                         (  186,349)
                                                       ---------
    NET PROPERTY AND EQUIPMENT                           508,278
                                                       ---------
Security deposits                                          6,538
Other asset                                                2,135
                                                       ---------

    TOTAL ASSETS                                     $ 4,681,294
                                                       =========

</TABLE>



             See accompanying notes to financial statements.<PAGE>
FORM 10-QSB

                          COVALENT GROUP, INC.
                       CONSOLIDATED BALANCE SHEET
                           SEPTEMBER 30, 1996
                              (Unaudited)



<TABLE>
<CAPTION>
<S> <S>                                              <C> 
    LIABILITIES AND SHAREHOLDERS' EQUITY

CURRENT LIABILITIES
Accounts payable and accrued expenses                $   601,779
Billings in excess of related costs and
  estimated earnings on uncompleted
  contracts                             (Note 1)         679,500
                                                       ---------
    TOTAL LIABILITIES                                  1,281,279
                                                       ---------

SHAREHOLDERS' EQUITY
Common stock, $.001 par value,
  authorized 25,000,000 shares,
  issued and outstanding 11,542,715
  shares                                                  11,543
Additional paid in capital                             9,059,126
Deficit                                               (5,670,654)
                                                       ---------

    TOTAL SHAREHOLDERS' EQUITY                         3,400,015
                                                       ---------

    TOTAL LIABILITIES AND
      SHAREHOLDERS' EQUITY                           $ 4,681,294
                                                       ---------
</TABLE>







             See accompanying notes to financial statements.<PAGE>
FORM 10-QSB
                          COVALENT GROUP, INC.
                 CONSOLIDATED STATEMENTS OF OPERATIONS
                              (Unaudited)
<TABLE>
<CAPTION>
                             THREE MONTHS ENDED        NINE MONTHS ENDED
                               SEPTEMBER 30,             SEPTEMBER 30,    
                               1996       1995          1996        1995
                              ------     ------        ------      ------
<S>                       <C>         <C>          <C>          <C>
REVENUES       (Note 1)   $ 2,686,690 $   365,540  $ 6,622,841  $ 1,511,571
                           ----------  ----------   ----------   ----------
COST AND EXPENSES
Cost of revenue             1,624,324     125,269    3,796,824      610,334
Selling, general and
 administrative               556,665     487,614    1,505,445    1,373,127
Research and development      291,123                  590,080             
                           ----------  ----------   ----------   ----------
TOTAL COST AND EXPENSES     2,472,112     612,883    5,892,349    1,983,461
                           ----------  ----------   ----------   ----------

INCOME (LOSS) FROM
 OPERATIONS                   214,578  (  247,343)     730,492   ( 
471,890)
                           ----------  ----------   ----------   ----------

OTHER INCOME (EXPENSE)
Interest and
  miscellaneous income         30,632     105,898       64,732      298,224
Interest and 
  miscellaneous expense    (    1,201)              (   2,197)             
                           ----------  ----------   -----------   ---------
TOTAL OTHER INCOME
  (EXPENSE)                    29,431     105,898       62,535      298,224
                           ----------  ----------   ----------    ---------
INCOME (LOSS) FROM
 CONTINUING OPERATIONS       244,009  (  141,445)     793,027   (  173,666)

DISCONTINUED
 OPERATIONS    (Note 2)
Loss from operations of 
  discontinued
  subsidiary    (Note 2)   (   36,201)              (  157,176)
Loss on disposal of
  subsidiary    (Note 2)   (  301,660)              (  301,660)            
                           ----------   ---------   ----------    ---------
NET INCOME (LOSS)         $(   93,852)$(  141,445) $   334,191  $( 173,666) 
                           ==========   =========   ==========    =========
NET INCOME (LOSS)
  PER SHARE               $(      .01)$(      .01) $       .03  $(     .02)
                           ==========  ==========   ==========    =========
WEIGHTED AVERAGE NUMBER          
  OF SHARES OUTSTANDING    11,542,362  10,234,490   11,143,909    8,187,801
                           ==========  ==========   ==========    =========
</TABLE>
               See accompanying notes to financial statements.<PAGE>
FORM 10-QSB

                           COVALENT GROUP, INC.                             
                   CONSOLIDATED STATEMENTS OF CASH FLOWS
                NINE MONTHS ENDED SEPTEMBER 30, 1996 AND 1995
                              (Unaudited)
<TABLE>
<CAPTION>
                                               1996          1995
                                              ------        ------
<S>                                        <C>           <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss) for the period           $   334,191   $(  173,666)

ADJUSTMENTS TO RECONCILE NET INCOME
 (LOSS) TO NET CASH PROVIDED BY
  (USED IN) OPERATING ACTIVITIES   
Depreciation and amortization                  123,203        94,739
Loss on disposition of subsidiary              301,660        

CHANGES IN OPERATING ASSETS
 AND LIABILITIES         
Increase in receivables                     (  423,205)   (  155,774)
Increase in inventories                     (   60,966)   (  209,150)
Decrease (increase) in prepaid expenses          5,086    (    5,977)
Increase in costs and estimated earnings
  in excess of related billings on
  uncompleted contracts                     (1,325,635)
Decrease (increase) in other assets                506    (   18,941)
Increase (decrease) in accounts payable
  and accrued expenses                         506,102    (  252,360)
Increase in billings in excess of related
  costs and estimated earnings on
  uncompleted contracts                        679,500       161,082
                                             ---------     ---------
NET CASH PROVIDED BY (USED IN)
  OPERATING ACTIVITIES                         140,442    (  560,047)
                                             ---------     --------- 
CASH FLOWS USED IN INVESTING ACTIVITIES 
Purchase of property and equipment          (  265,844)   (  430,341)
Net change in assets of discontinued 
  operations                                (   40,555)             
                                             ---------     ---------
NET CASH USED IN INVESTING ACTIVITIES       (  306,399)   (  430,341)
                                             ---------     ---------
Cash Flows From Financing Activities
Decrease in loans from officer                              ( 26,349)
Reduction of debt                           (    5,000)     (341,185)
Proceeds from issuances of common stock      1,872,624     1,944,136
                                             ---------     ---------
NET CASH PROVIDED BY FINANCING ACTIVITIES    1,867,624     1,576,602
                                             ---------     ---------
NET INCREASE IN CASH AND 
  CASH EQUIVALENTS                           1,701,667       586,214

BEGINNING CASH AND CASH EQUIVALENTS            305,835        18,373
                                             ---------     ---------
ENDING CASH AND CASH EQUIVALENTS           $ 2,007,502  $    604,587
                                             =========     =========
</TABLE>
Supplemental Disclosure          (Note 2)
            See accompanying notes to financial statements.
<PAGE>
FORM 10-QSB

                         COVALENT GROUP, INC.
               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS




1.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

    Nature of Organization

    Future  Medical Technologies, Inc.  ("FMT") was incorporated under
    the laws of the State of New Jersey on September 28, 1989.

    On  January  26,  1990,  West End Ventures,  Inc.   (West  End),
    acquired 100% of the stock of FMT.  West End was organized under the
    laws of the State of Nevada on August 1, 1989.  West End completed
    a blind pool public offering of common stock on January  15,  1990. 
    The intent upon completion  of  the offering  was to seek potential
    businesses with which to merge  or acquire.   Pursuant to the
    acquisition agreement, West End amended its  Certificate of
    Incorporation to change its name  to  Future Medical Technologies
    International,  Inc.    (FMTI) and the subsidiary (FMT) retained its
    name.  West  End's officers  and directors resigned in favor of the
    officers and directors of FMT.

    In 1994, FMTI effected a one for five reverse stock split.

    On  February  22,  1995,  FMTI effected a  five  for  seven reverse 
    stock split and completed the acquisition of 100% of  the stock  of
    Covalent  Research   Alliance  Corporation,  (CRA)  a Pennsylvania
    corporation, in exchange for 7,200,000 shares of post split  common
    stock of FMTI.  CRA is a total research  management organization 
    whose strength is in the design and  management  of clinical  trials 
    in the drug and device development  process  and with  associated
    cost containment and quality of care  components.

    On September 20, 1996 FMTI ratified the disposition of all stock of
    FMT.  As provided in the ratification, the effective date of the
    transaction was July 31, 1996.  At the same time, shareholders
    approved the change of the Company's name to Covalent Group, Inc.
    (the "Company").

    Principles of Consolidation

    The  accompanying  consolidated financial statements  include  the
    accounts  of the Company and all of its wholly owned subsidiaries.
    Intercompany  transactions  and balances have been  eliminated  in
    consolidation.

    Cash Equivalents

    Cash equivalents include investments with maturities of three months
    or less.

    Inventories

    Inventories  are  recorded at the lower of cost (first-in/first-out)
    or market.
<PAGE>
    Property and Equipment           

    Property and equipment are recorded at cost.  Depreciation is 
    provided  using a combination of straight-line and  accelerated
    methods  over the useful lives of the assets, which range from two
    to seven years.

    Revenue Recognition

    The  Company  recognizes  revenue  using  the  accrual  method  of
    accounting  whereby it records revenue at the time a sale has been
    made  and the product shipped or services performed.  In addition,
    long   term   contract   revenues   are   recognized   under   the
    percentage-of-completion  method  based  on  the  ratio  of  costs
    incurred to date on the contract to total estimated contract costs
    after  providing  for  all  known or  anticipated  losses.   Costs
    include  direct  and  subcontract labor  and  applicable  overhead
    expenses.   Cost  estimates are reviewed periodically as the  work
    progresses  and adjustments to revenue are reflected in the period
    in  which revisions to such estimates are deemed appropriate.  All
    anticipated   losses  are  recognized   immediately.   Costs   and
    estimated earnings in excess of billings on uncompleted contracts,
    as  reflected  in the balance sheet, comprise amounts  of  revenue
    recognized on contracts for which billings have not been rendered.
    Billings  in excess of costs and estimated earnings on  uncompleted
    contracts  comprise  amounts of billings recognized on  contracts
    for which costs have not been incurred.

    Basis of Presentation

    The financial statements for the three months and nine months ended
    September 30, 1996 have been  prepared  without  audit   and,  in 
    the  opinion  of management, reflect all adjustments necessary
    (consisting only of normal  recurring adjustments)  to present
    fairly  the  Company's financial  position  at September 30, 1996
    and the  results  of  its operations  and  its  cash flows for the 
    interim  and  cumulative periods  presented.  Such financial
    statements do not include  all of  the  information and footnotes
    required by generally  accepted accounting  principles  for 
    complete financial  statements.   For further  information,  refer 
    to   the financial  statements  and footnotes  thereto included in
    the Company's annual report on Form 10-KSB for the year ended
    December 31, 1995.

    Operating  results  for the three months and nine months ended
    September 30, 1996  are not  necessarily  indicative  of the results
    for the  year ending December 31, 1996.

2.  SUPPLEMENTAL DISCLOSURE OF NONCASH INVESTING ACTIVITY

    On September 20, 1996, the Company disposed of all the stock of FMT
    for $250,000, payable over five years with interest at 7% per annum. 
    As provided in the ratification, the effective date of the
    transaction was July 31, 1996.  The assets and liabilities of FMT
    have been removed from the Company's September 30, 1996 consolidated
    balance sheet and a corresponding receivable has been recorded.  The
    September 30, 1996 consolidated statement of operations includes the
    results of FMT for the seven months ended July 31, 1996.

<PAGE>
Item 2.   Management's Discussion and Analysis of Results of Operations
          and Financial Condition


The information set forth and discussed below for the three months and
nine months ended September 30, 1996 is derived from the Consolidated
Financial Statements included elsewhere herein.  The financial
information set forth and discussed below is unaudited but, in the
opinion of management, reflects all adjustments (consisting of normal
recurring accruals) necessary for a fair presentation of such
information.  The Company's results of operations for a particular
quarter may not be indicative of results expected during the other
quarters or for the entire year.

GENERAL

CRA is a research management organization that designs, coordinates and
monitors clinical trials in drug development for some of the world's
leading pharmaceutical firms.  In addition, using advanced technologies,
the Company works extensively in managed care, medical outcomes research
and health management programs that focus on compliance and
provider/patient behavior modification.  Revenue is derived principally
from the identification, placement, monitoring and management of
clinical development studies in the traditional pharmaceutical, as well
as managed care environment.

The Company's quarterly results can fluctuate as a result of a number of
factors, including the Company's success in attracting new business, the
size and duration of the clinical trials, the timing of client decisions
to conduct new clinical trials or possible cancellation or delays of
ongoing trials, and other factors, many of which are beyond the 
Company's control.  Clinical research service contracts generally have
terms ranging from several months to several years.  A portion of the
contract fee is generally payable upon execution of the contract, with
the balance payable in installments over the life of the contract. 
Revenue and related cost of revenue are recognized as specific contract
terms are fulfilled under the percentage of completion method.

Contracts generally may be terminated by clients with or without cause. 
Clinical trials may be terminated or delayed for several reasons,
including unexpected results or adverse patient reactions to the drug,
inadequate patient enrollment or investigator recruitment, manufacturing
problems resulting in shortages of the drug or decisions by the client
to de-emphasize or terminate a particular trial or development efforts
on a particular drug.  Depending on the size of the trial in question,
a client's decision to terminate or delay a trial in which the Company
participates could have a materially adverse effect on the Company's
backlog, future revenue and profitability.

The Company's backlog consists of anticipated revenue from letters of
intent in excess of $11,000,000 and work remaining on signed contracts. 
In certain cases, the Company will begin work on a project after
receiving a letter of intent and prior to executing a contract.  The
Company believes that its backlog as of any date is not necessarily a
meaningful predictor of future results.

SALE OF BUSINESS

The Board of Directors concluded that the Company's subsidiary FMT would
require substantial funding of research and development in order to
fully develop its business.  The Board decided that additional funding
was not in the best strategic interest of the Company.  On July 26,
1996, an agreement was reached, and subsequently ratified by the
Company's shareholders on September 20, 1996, to sell all of the stock
of FMT for $250,000.  As additional consideration, the agreement
provides for a licensing fee ranging from 5% to 2.5% payable to the
Company on the revenue of certain FMT products over the next five years.

The financial impact of this transaction resulted in a one time
nonrecurring loss of $301,660 which was charged to earnings in the third
quarter ended September 30, 1996.

In addition, Joseph Hippensteel and Dianne Van Leeuween, officers of FMT
agreed to donate back to the Company 285,000 and 190,000 stock options
(expiring March 22, 2000 at the exercise price of $2.875 per share),
respectively.<PAGE>
RESULTS OF OPERATIONS

THREE MONTHS ENDED SEPTEMBER 30, 1996 COMPARED WITH THREE MONTHS ENDED
September 30, 1995

Revenue for the three months ended September 30, 1996 increased 635% to
$2,686,690 as compared to $365,540 in the three month period ended
September 30, 1995 due to the increase in the number and size of
clinical development studies.

Cost of revenue includes compensation and other expenses directly
related to conducting clinical studies.  These costs increased by
$1,499,055 or 1,197% from $125,269 to $1,624,324 for the three months
ended September 30, 1995 and 1996, respectively.  As a percentage of
revenue, the cost of revenue increased from 34% during the three months
ended September 30, 1995 to 60% during the three months ended September
30, 1996.  The increase in relative percent of costs to revenue is due
to growth in the number, size and complexity of clinical studies.

Selling, general and administrative expenses include all administrative
personnel and business development, and all other expenses not directly
chargeable to a specific contract.  Selling, general and administrative
costs for the three month period ended September 30, 1996 increased 14%
to $556,665 as compared to $487,614 during the three months ended
September 30, 1995.  As a percentage of revenue, selling, general and
administrative expenses decreased from 133% to 21% for the three months
ended September 30, 1995 and 1996, respectively.  The decrease in
selling, general and administrative expenses as a percentage of revenue
reflects decrease fixed costs resulting from the change of the Company's
services and personnel required to deliver these services.

Research and development expense of $291,123 for the three month period
ended September 30, 1996 relates to the development of voice recognition
software.

Depreciation and amortization expense decreased from $33,537 in the
three month period ended September 30, 1995 to $32,573 during the three
months ended September 30, 1996.  The decrease is attributed to the
disposition of FMT on July 31, 1996.

Other income decreased $76,467 from $105,898 in the three month period
ended September 30, 1995 to $29,431 in the three month period ended
September 30, 1996.

As a result of the Company's net operating loss carry forward which is
in excess of $900,000 for federal income tax purposes, the Company does
not anticipate a federal tax liability for 1996.  Accordingly, the tax
rate is not reflected in the Company's Consolidated Statement of
Operations for the three months ended September 30, 1996.
<PAGE>
Net loss from discontinued operations for the three months ended
September 30, 1996 amounted to $36,201 and pertains to the sale of FMT.
The sales price for FMT was $250,000.  The terms require a $25,000 down
payment and the balance is payable over the next five years with
interest at the rate of 7% per annum.  As a result of the sale, the
Company incurred a loss of $301,660.

Net loss incurred by the Company for the three months ended September
30, 1996 was $93,852, consisting of net income of CRA of $244,009, net
loss of discontinued FMT operations of $36,201 and the $301,660 loss on
the sale of FMT.  The net loss realized in the three months ended
September 30, 1995 was $141,445.  The increase in income was due to the
factors described above.

NINE MONTHS ENDED SEPTEMBER 30, 1996 COMPARED WITH NINE MONTHS ENDED
SEPTEMBER 30, 1995

Revenue for the nine months ended September 30, 1996 increased 338% to
$6,622,841 as compared to $1,511,571 in the nine month period ended
September 30, 1995 due to the increase in the number and size of
clinical development studies.

Cost of revenue increased by $3,186,490 or 522% from $610,334 to
$3,796,824 for the nine months ended September 30, 1995 and 1996,
respectively.  As a percentage of revenue, the cost of revenue increased
from 40% during the nine months ended September 30, 1995 to 57% during
the nine months ended September 30, 1996.  The increase in relative
percent of cost to revenue is due to growth in the number, size and
complexity of clinical studies.

Selling, general and administrative expenses for the nine month period
ended September 30, 1996 increased 10% to $1,505,445 as compared to
$1,373,127 during the nine months ended September 30, 1995.  As a
percentage of revenue, selling, general and administrative expenses
decreased from 91% to 23% for the nine months ended September 30, 1995
and 1996, respectively.  The decrease in selling, general and
administrative expenses as a percentage of revenue reflects the growth
of the Company's services.

Research and development expense of $590,080 for the nine month period
ended September 30, 1996 relates to the development of voice recognition
software.

Depreciation and amortization expense increased from $94,739 in the nine
month period ended September 30, 1995 to $103,040 during the nine months
ended September 30, 1996.  The increase is attributed to fixed asset
purchases during 1996.

Other income decreased $235,689 from $298,224 in the nine month period
ended September 30, 1995 to $62,535 in the nine month period ended
September 30, 1996.

As a result of the Company's net operating loss carryforward which is in
excess of $900,000 for federal income tax purposes, the Company does not
anticipate a federal tax liability for 1996.  Accordingly, the tax rate
is not reflected in the Company's Condensed Consolidated Statement of
Operations for the nine months ended September 30, 1996.
<PAGE>
Net loss from discontinued operations for the nine months ended
September 30, 1996 amounted to $157,176 and pertains to the sale of FMT.
The sales price for FMT was $250,000.  The terms require a $25,000 down
payment and the balance is  payable over the next five years with
interest at the rate of 7% per annum.  As a result of the sale, the
Company incurred a loss of $301,660.

Net income realized by the company for the nine months ended September
30, 1996 was $334,191, consisting of net income of CRA of $793,027, net
loss of discontinued FMT operations of $157,176 and the $301,660 loss on
the sale of FMT.  The net loss realized in the nine months ended
September 30, 1995 was $173,666.  The increase in income was due to the
factor described above.

LIQUIDITY AND CAPITAL RESOURCES 

The Company's contracts usually require a portion of the contract amount
to be paid at the time the contract is initiated.  Additional payments
are generally made upon completion of negotiated performance
requirements throughout the life of the contract.  Cash receipts do not
necessarily correspond to costs incurred and revenue recognized (revenue
recognition is based on the percentage of completion accounting method). 
The Company typically receives a low volume of large-dollar receipts. 
As a result, the number of days outstanding in accounts receivable will
fluctuate due to the timing and size of cash receipts.  Accounts
receivable (net of allowance for doubtful accounts) was $515,369 at
September 30, 1996 and $161,232 at December 31, 1995.  On a pro forma
basis, after giving effect to the FMT divestiture, accounts receivable
(net of allowance for doubtful accounts) would have been $124,736 at
December 31, 1995.  The number of days outstanding in accounts
receivable was 21 days at September 30, 1996 and 33 days at December 31,
1995 (26 days on a pro forma basis).

Cash and cash equivalents increased $1,701,667 provided by operating and
financing activities respectively, offset by $306,399 used in investing
activities.  Investing activities included $265,844 used to purchase
property and equipment.

The Company's principal cash needs on both a short and long-term basis
are for the funding of its operations, and capital expenditure
requirements.  The Company expects to continue expanding its operations
through internal growth, expansion of existing list of services as well
as developing new service products for clinical research and the
healthcare industry.  The Company expects such activities will be funded
from existing cash and cash equivalents and cash flow from operations.
<PAGE>
                 COVALENT GROUP, INC. AND SUBSIDIARIES


PART II.  OTHER INFORMATION
     
     ITEM 1.   Legal Proceedings

               None.
    
     ITEM 2.   Changes in Securities
    
               None.
    
     ITEM 3.   Defaults Upon Senior Securities

               None.
    
     ITEM 4.   Submission of Matters to a Vote of Security Holders.

               On September 20, 1996, the Annual Meeting of Shareholders
for Fiscal Year 1995 was held to vote on the following matters:

          (1)  To elect three Directors (Bruce LaMont, William K.
               Robinson and John Whittle) for the ensuing year;
               Votes in Favor: 8,535,205; Against: 71; Abstain: 0
          (2)  To approve the selection of Baratz & Associates, P.A., as
               the Company's independent public accountants for the
               fiscal year ending December 31, 1996;
               Votes in Favor: 8,504,812; Against: 99; Abstain: 30,432
          (3)  Proposal to approve the 1996 Stock Option Plan
               (2,000,000 shares).
               Votes in Favor: 7,949,230; Against: 348; Abstain: 730
          (4)  Approve the name change of the Company to Covalent Group,
               Inc.
               Votes in Favor: 7,949,658; Against: 174; Abstain: 297
          (5)  Approve the disposition of 100% of the stock of Future
               Medical Technologies, Inc. in a sale to Medical
               Technologies, Inc.
               Votes in Favor: 7,929,221; Against: 99; Abstain: 269
                         
               The number of shares which were eligible for voting as of
August 20, 1996 was 11,543,403.  The number of shares that actually
voted was 8,534,533.  Therefore all propositions passed.

     ITEM 5.   Other Information

               On July 24, 1996, the Registrant entered into a Letter of
Intent/Agreement with Medical Technologies, Inc. ("MTI") for the
disposition of FMT because the Company's Future Medical Technologies,
Inc. ("FMT") subsidiary required substantial funds for research and
development from investment in order to fully develop its business.  On
August 20, 1996, the transaction was finalized, subject to shareholder
approval.  The Board of Directors of the Company decided that because of
its limited cash resources, that the Company would be better served to
spend its resources on its other divisions.  Accordingly, the Company
sold its 100% interest in FMT in order to avoid having to put further
investment funds in FMT and to stop the substantial reduction of
earnings in the consolidated financials that was adversely affecting the
Registrant ($110,000 FMT loss in second quarter, 1996 alone).  The
<PAGE>
transaction was approved by the shareholders with a vote in favor of
7,929,221 shares, 99 shares against and 269 shares abstaining.

    The above summary of information does not purport to be complete and
is qualified in its entirety by reference to the Letter of
Intent/Agreement attached as Exhibit 1 to Form 8-K for earliest event
reported July 26, 1996.

     ITEM 6.   Exhibits and Reports on Form 8-K

               Exhibits
               
               None.
          
               Reports on Form 8-K
               
               The Registrant filed a Form 8-K for earliest event
reported July 26, 1996 pertaining to the disposition of the Company's
Future Medical Technologies, Inc. subsidiary whereby it disposed of 100%
of that stock of that subsidiary.  That Form 8-K and Exhibit is
incorporated with reference hereto.
<PAGE>
                              SIGNATURES




    In accordance with the requirements of the Exchange Act, the
Registrant caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.



                                      COVALENT GROUP, INC.




Dated: November 7, 1996           By: /s/Bruce LaMont
                                                                
                                      Bruce LaMont, President
                                      and Chief Executive Officer




Dated: November 7, 1996           By: /s/William Robinson 
                                                                
                                      William Robinson
                                      Chief Financial Officer