<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 ENDED MARCH 31, 1997.

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


Commission file number   33-43537


                          COVALENT GROUP, INC.
              (Name of small business issuer in its charter)


              Nevada                            56-1668867

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


           One Glenhardie Corporate Center, 1275 Drummers Lane
                        Wayne, Pennsylvania 19087
          (address of principal executive offices)   (Zip Code)


Issuer's telephone number: 610-975-9533


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.  Yes X No 

State  the number of shares outstanding of each of the issuer's  classes
of common equity, as of May 9, 1997.


Common Stock, Par Value  $.001                               11,602,920 
------------------------------                               ----------
         (Class)                                             Outstanding

Transitional Small Business Disclosure Format(check one): Yes    No X 
                                                             ---   ---






FORM 10-QSB


                          COVALENT GROUP, INC.




                                INDEX

<TABLE>


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

     Item 1.  Consolidated Financial Statements

          Balance Sheet - March 31, 1997 (Unaudited)           2 & 3

          Statements of Operations (Unaudited) - Three
          Months Ended March 31, 1997 and 1996                   4

          Statements of Cash Flows (Unaudited) - Three
          Months Ended March 31, 1997 and 1996                   5

          Notes to Consolidated Financial Statements
          (Unaudited)                                          6 & 7

     Item 2.  Management's Discussion and Analysis of
              Financial Condition and Results of
              Operations                                       8 & 9

PART II.  Other Information                                     10

Signature Page                                                  11





</TABLE>









                                  

                                                            1
<PAGE>
FORM 10-QSB         PART I - FINANCIAL INFORMATION


                          COVALENT GROUP, INC.
                     CONSOLIDATED BALANCE SHEET
                            MARCH 31, 1997
                             (Unaudited)



<TABLE>
<CAPTION>

    Assets
    ------
<S>                                                  <C>
Current Assets
--------------
Cash                                                 $ 1,205,290
Accounts receivable                                    3,400,957
Note receivable, current                                  25,000
Prepaid expenses                                         246,035
Deferred income tax benefit                              199,871
                                                       ---------
    Total Current Assets                               5,077,153
    --------------------                               ---------
Property and Equipment
----------------------
Equipment                                                647,139
Furniture and fixtures                                   159,022
                                                       ---------
                                                         806,161
Less accumulated depreciation                         (  239,105)
                                                       ---------
    Net Property and Equipment                           567,056
    --------------------------                         ---------
Other Assets
------------
Note receivable, less current portion                    200,000
Security deposit                                           6,538
Other asset                                                1,497
                                                       ---------
    Total Other Assets                                   208,035
    ------------------                                 ---------
    Total Assets                                     $ 5,852,244
    ------------                                       =========

</TABLE>







             See accompanying notes to financial statements.



                                                            2



FORM 10-QSB

                           COVALENT GROUP, INC.
                       CONSOLIDATED BALANCE SHEET
                             MARCH 31, 1997
                               (Unaudited)



<TABLE>
<CAPTION>

<S>                                                  <C>
    Liabilities and Shareholders' Equity
    ------------------------------------
Current Liabilities
-------------------
Accounts payable                                     $ 1,774,090
Advance billings                                         269,776
                                                       ---------
    Total Liabilities                                  2,043,866
    -----------------                                  ---------

Shareholders' Equity
--------------------
Common stock, $.001 par value per
  share, authorized 25,000,000 shares,
  issued and outstanding 11,602,920
  shares                                                  11,603
Additional paid-in capital                             9,083,632
Deficit                                               (5,286,857)
                                                       ---------

    Total Shareholders' Equity                         3,808,378
    --------------------------                         ---------

    Total Liabilities and
      Shareholders' Equity                           $ 5,852,244
    ----------------------                             =========





</TABLE>







             See accompanying notes to financial statements.


                                                            3
<PAGE>
FORM 10-QSB
                         COVALENT GROUP, INC.
                 CONSOLIDATED STATEMENTS OF OPERATIONS
                              (Unaudited)

<TABLE>
<CAPTION>

                                                  For Three Months
                                                   Ended March 31,    
                                              ------------------------
                                                 1997          1996
                                                 ----          ---- 
<S>                                         <C>            <C>
Revenues                                    $  3,045,718   $ 1,707,152
--------
Cost of Revenues                               2,312,772       982,896
----------------                              ----------     ---------
Gross Profit                                     732,946       724,256
------------              
Operating Expenses
------------------
General and administrative                       585,546       463,683
Research and development                         165,571       121,442
                                              ----------     ---------
Total Operating Expenses                         751,117       585,125
------------------------                      ----------     ---------
Income (Loss) From Operations                (    18,171)      139,131 
-----------------------------  
Other Income                                      13,445        16,276
------------                                  ----------     ---------
Income (Loss) From Continuing
  Operations Before Income Tax Benefit       (     4,726)      155,407
--------------------------------------
Income tax benefit                               103,508              
                                              ----------     ---------
Income From Continuing Operations                 98,782       155,407
---------------------------------       
Discontinued Operations                
-----------------------
Loss from operations                                        (   40,347)
                                              ----------     ---------
Net Income                                  $     98,782   $   115,060
----------                                    ==========     =========
Net Income Per Common and
  Common Equivalent Share                            .01           .01
-------------------------                     ==========    ==========
Weighted Average Common 
  Shares Outstanding                          12,125,677    10,856,081
-----------------------                       ==========    ==========


</TABLE>

             See accompanying notes to financial statements.

                                                            4
<PAGE>
FORM 10-QSB
                           COVALENT GROUP, INC.
                  CONSOLIDATED STATEMENTS OF CASH FLOWS
                              (Unaudited)
<TABLE>
<CAPTION>
                                               Three Months Ended 
                                                   March 31,        
                                             -----------------------
                                               1997          1996
                                               ----          ----
<S>                                        <C>          <C>
Cash Flows From Operating Activities
------------------------------------
Net income for the period                  $    98,782   $   115,060 
Adjustments to Reconcile Net Income
  To Net Cash Provided By Operating
  Activities                       
-----------------------------------
Amortization and depreciation                   35,406        24,916
Changes In Operating Assets
  and Liabilities          
---------------------------
Increase in accounts receivable             (  267,166)   (  564,943)
Increase in other receivable                              (    9,000)    
(Increase) decrease in prepaid expenses     (  163,386)       32,293 
Increase in deferred income tax benefit     (  103,508)
Decrease (increase) in other asset                 319    (   50,658)
Decrease in accounts payable                 1,077,592       183,549
(Decrease) increase in advance billings     (  316,091)    1,466,136
                                             ---------     ---------
Net Cash Provided By Operating
  Activities                                   361,948     1,197,353
------------------------------               ---------     ---------
Cash Flows From Investing Activities
------------------------------------
Purchases of equipment and furniture        (   78,668)   (  129,456)
Net change in assets of discontinued
  operations                                              (   77,856)
                                             ---------     ---------
Net Cash Used In Investing Activities       (   78,668)   (  207,312)
-------------------------------------        ---------     ---------
Cash Flows Provided By Financing Activities
-------------------------------------------
Proceeds from sales of common stock                                  
  and option exercises                                       119,245 
                                             ---------     ---------
Net Increase In Cash                           283,280     1,109,286
--------------------
Cash at Beginning of Period                    922,010       298,583
---------------------------                  ---------     ---------
Cash at End of Period                      $ 1,205,290  $  1,407,869
---------------------                        =========     =========
</TABLE>
            See accompanying notes to financial statements.
                                                            5
<PAGE>
FORM 10-QSB
                          COVALENT GROUP, INC.
               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.   Description of Business

     Covalent Group, Inc. (the Company), formerly Future Medical
     Technologies International, Inc., is a leading contractual research
     organization, providing clinical research and development services
     to pharmaceutical, biotechnology, medical services and managed care
     organizations.  The Company initiates, designs and monitors
     clinical trials, manages and analyzes clinical data and offers
     other related services and products.

2.   Summary of Significant Accounting Policies

     Use of Estimates

     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 period. 
     Actual results could differ from those estimates.

     Principles of Consolidation

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

     Basis of Presentation

     The financial statements for the three months ended March 31, 1997
     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 March 31, 1997 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, 1996.

     Operating results for the three months ended March 31, 1997 are not
     necessarily indicative of the results for the year ending December
     31, 1997.

     Revenue Recognition

     Fixed price contract revenue is recognized using the percentage of
     completion method based on the ratio of costs incurred to date to
     estimated total costs at completion.  Revenue from other contracts 

                                                            6
<PAGE>
     is recognized as services are provided.  Revenue related to
     contract modifications is recognized when realization is assured
     and the amounts are reasonably determinable.  Adjustments to
     contract cost estimates are made in the periods in which the facts
     which require the revisions become known.  When the revised
     estimate indicates a loss, such loss is provided for currently in
     its entirety.  Unbilled accounts receivable, included in accounts
     receivable, represent revenue recognized in excess of amounts
     billed.  Advance billings represent amounts billed in excess of
     revenue recognized.

     Property and Equipment

     Property and equipment are recorded at cost.  Depreciation is
     provided using a combination of straight line and accelerated
     methods over the estimated useful lives of the assets.  No material
     differences would result if depreciation was provided under the
     straight line method.  Expenditures for maintenance and repairs are
     charged against income as incurred.  When assets are sold or
     retired, the cost and accumulated depreciation are removed from the
     accounts and any gain or loss is included in income.

     Research and Development

     Research and development costs are charged to operations when
     incurred.

     Reclassification

     Certain prior year balances have been reclassified to conform to
     current year presentation.

     Net Income Per Common and Common Equivalent Share

     Net income per common and common equivalent share is based on the
     weighted average number of common and common equivalent shares
     (stock options and warrants) outstanding in each period.  The
     computation of fully diluted net income per common and common
     equivalent share was antidilutive in each of the periods presented.

3.   Discontinued Operations

     On July 31, 1996, the Company sold all of the assets and
     liabilities of Future Medical Technologies, Inc. (FMT) for $250,000
     and certain royalty payments upon the sale of certain products for
     up to five years.  $25,000 of the selling price was received in
     1996 and the remaining balance is due in annual installments of
     $25,000 (1997), $50,000 (1998 and 1999) and $100,000 (2000). 
     Interest is charged at 7% per annum.  FMT was accounted for as
     discontinued operations and accordingly, assets, liabilities and
     operations were segregated in the accompanying consolidated balance
     sheet and statements of operations.




                                                            7



<PAGE>
ITEM  2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL  CONDITION
AND RESULTS OF OPERATIONS

The information set forth and discussed below for the three months ended
March 31, 1997 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

Covalent Group, Inc. (the Company), and its wholly owned subsidiary
Covalent Research Alliance Corp., 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, medial 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 revenues 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 questions,
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 revenues from signed
contracts in excess of $10,000,000 at March 31, 1997.  The Company
believes that its backlog as of any date is not necessarily a meaningful
predictor of future results.

 

                                                            8
<PAGE>
Three Month Period Ended March 31, 1997 Compared To The Three Month
Period Ended March 31, 1996.

Revenues for the three months ended March 31, 1997 increased 78% to
$3,046,000 as compared to $1,707,000 for the three month period ended
March 31, 1996.  The increase of $1,339,000 is directly related to the
number and size of clinical development studies.

Cost of revenues includes compensation and other expenses directly
related to conducting clinical studies.  These costs increased
$1,330,000 from $983,000 to $2,313,000 for the three month periods ended
March 31, 1996 and 1997, respectively.  Cost of revenues as a percentage
of total revenues was 76% for the three months ended March 31, 1997 as
compared to 58% for the same period last year.  The increase in relative
percent is due to the type of clinical studies conducted and the
different cost structures and complexity of contracts.

General and administrative expenses include all administrative personnel
and business development, and all other support expenses not directly
chargeable to specific contracts.  General and administrative expenses
for the three month period ended March 31, 1997 amounted to $586,000 as
compared to $464,000 for the same period last year.  As a percentage of
revenues, general and administrative expenses decreased from 27% to 19%
for the three month periods ended March 31, 1996 and 1997, respectively. 
The increase in the level of expenses from the 1996 period to 1997 is
due to the overall expansion of the business and costs associated with
building the necessary support infrastructure.  The decrease in expenses
as a percentage of revenues from 1996 to 1997 reflects the growth of
clinical trial services.

Research and development expense for the three month period ended March
31, 1997 amounted to $166,000 as compared to $121,000 for the same
period last year and relates to costs associated with developing an
interactive voice recognition system.  The 1997 expense is net of
$79,000 in reimbursed costs funded by a client.

Other income decreased $3,000 from $16,000 for the three months ended
March 31, 1997 to $13,000 for the three month period ended March 31,
1997 due to less interest income.

Net loss from discontinued operations for the three month period ended
March 31, 1996 amounted to $40,000 and relates to three months of
operations of Future Medical Technologies (FMT), a subsidiary of the
Company, which was sold to a third party on July 26, 1996.  All results
associated with this business have been reclassified to this line for
financial reporting purposes.

The financial impact of this transaction resulted in a one time
nonrecurring loss of $328,000 which was charged to earnings in the
quarter ended September 30, 1996.  In 1997, the Company reached
agreement with the purchaser, to treat the sale of FMT as an asset sale
under Internal Revenue Code Section 338 (h) (10).  Accordingly, the loss
on the disposition of FMT is deductible for tax purposes against future
net income.  As a result, during the first quarter of 1997, the Company
incurred an additional deferred tax asset of $104,000.  Management
anticipates the loss on disposition to be fully utilized.

                                                            9
<PAGE>
Net income realized by the Company decreased by $16,000 from $115,000 to
$99,000 for the three month period ended March 31, 1996 and 1997,
respectively.  The decrease in income was due to the above factors.

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 including unbilled services to clients was $3,401,000 at
March 31, 1997 as compared to $3,134,000 at December 31, 1996.

Cash and cash equivalents increased by $283,000 for the period ended
March 31, 1997 and was provided by operating activities, net of
equipment purchases of $79,000.

The Company has a line of credit with a commercial bank providing a
maximum credit facility of $1 million, and bears interest at a rate not
to exceed 1% point above the bank's prime rate.  Borrowings outstanding
under the line are secured by substantially all of the assets of the
Company.  No borrowings were outstanding under the line of credit at
March 31, 1997.

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 the 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.























                                                            10
<PAGE>
                         COVALENT GROUP, INC.




PART II.      OTHER INFORMATION

              ITEM 1.     Legal Proceeding:

                          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:

                          None.

              ITEM 5.     Other Information:

                          None.

              ITEM 6.     Exhibits and Reports on Form 8-K:

                          None.


























                                                            11
<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:  May 9, 1997                By:/s/Bruce LaMont
                                      -----------------------
                                      Bruce LaMont, President
                                      and Chief Executive Officer



Dated:  May 9, 1997                By:/s/William K. Robinson
                                      -----------------------
                                      William K. Robinson, Chief
                                      Financial Officer
     









                                                               12