AMENDMENT TO EMPLOYMENT AGREEMENT


     AMENDMENT  dated as of December 16, 1998 to the Employment  Agreement dated
June ___,  1995 (the  "Original  Agreement")  between  Q-Med,  Inc.,  a Delaware
corporation (the "Company") and Michael W. Cox ("Employee").

     WHEREAS, the Original Agreement expires on June 30, 2000; and

     WHEREAS, the Company's Board of Directors deems it in the best interests of
the Company to assure that the services of the Employee are  available to it for
a period of time beyond the initial term of the Original Agreement.

     NOW  THEREFORE,  in  consideration  of  the  agreements  set  forth  in the
Amendment  (defined  below) and those contained in the Original  Agreement,  the
parties agree as follows:

A.   CERTAIN DEFINITIONS.

     (a) Except as  otherwise  provided in this  agreement,  all words and terms
defined in the Original  Agreement,  have the same meanings in this agreement as
such defined words and terms are given in the Original Agreement.

     (b)  "Agreement"  means the Original  Agreement  dated June ___,  1995,  as
supplemented  and  amended by this  agreement  and as from time to time  further
supplemented and amended.

     (c) "Amendment" means this agreement dated as of December 16, 1998.

B.   EXTENSION OF TERM.

     Section 3 of the Original Agreement is amended to read as follows:

     "3.  TERM OF EMPLOYMENT.

          Unless earlier  terminated  pursuant to Section 8 hereof,  the term of
     employment  under this Agreement  shall be for a period  commencing July 1,
     1998 (the "Effective  Date") and ending November 30, 2000 (the  "Expiration
     Date").  This Agreement shall be  automatically  renewed for successive two
     (2) year periods,  unless either party shall notify the other in writing of
     its intention not to renew this  Agreement,  which notice shall be given at
     least 120 days prior to the end of the then current  term.  The period from
     the Commencement  Date to the Expiration Date,  including the Renewal Term,
     if any, is referred to herein as the "Term."



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<PAGE>


C.   ADJUSTMENT OF COMPENSATION.

     Section 5 of the original Agreement is amended to read as follows:

     "5.  COMPENSATION.

          5.1  Salary.

               (a) Company shall pay Employee a base salary  ("Base  Salary") of
          $140,000 per year during the Term.

               (b)  The  Employee's  Base  Salary  shall  be  increased  to  the
          following  annual  rates in the event the Company has  contracts  with
          managed care organizations relating to the management of the specified
          number of lives utilizing the Company's disease management system:

                                                Annual Rate
               Number of Lives                of Base Salary
               ---------------                --------------

                   400,000                       $180,000
                   500,000                       $200,000
                   640,000                       $250,000

          Such rate shall  take  effect in the first  regular  pay period of the
          month  following  the  month in which  revenue  is  received  from the
          managed care  organization for the requisite number of lives. The last
          increase shall not take effect until the month  following the month in
          which the Company has positive cash flow.

               (c) Once increased,  such increased  amount shall  constitute the
          Employee's Base Salary and shall not be reduced.  Base Salary shall be
          payable in  accordance  with the  ordinary  payroll  practices  of the
          Company.

          5.2  Contingent Compensation.

               (a) In  addition to Base  Salary,  beginning  with the  Company's
          fiscal year ending  November 30, 1999,  the Company shall pay Employee
          contingent compensation as follows:

                    (i)  $50,000 if the Company's Adjusted Net Earnings (defined
                         below) equals or exceeds $1.0 million; plus


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<PAGE>


                    (ii) 3% of the Company's  Adjusted Net Earnings in excess of
                         $1.0  million  to a maximum  aggregate  bonus  equal to
                         twice the  Employees  rate of annual Base Salary during
                         the last month of the relevant fiscal year.

               (b) In order to be eligible for the contingent  compensation  set
          forth in paragraph 5.2 (a) above for any fiscal year, Employee must be
          employed by the Company throughout that entire fiscal year;  provided,
          however, that if Employee's employment terminates during a fiscal year
          for any  reason  other  than  that  set  forth in  Section  8.4 of the
          Agreement,  then the Employee (or his estate)  shall be eligible for a
          pro-rated amount of such contingent compensation.

               (c)  The  adjusted   consolidated  net  earnings  ("Adjusted  Net
          Earnings")  of the  Company and its  subsidiaries,  for the purpose of
          computing the Employees' contingent  compensation under the provisions
          of paragraph  5.2(a) above,  shall be determined,  in accordance  with
          generally  accepted  accounting  principles,  within  ninety (90) days
          after the end of each fiscal year by the  independent  accounting firm
          employed  by the  Company as its  auditors.  The  computation  by such
          accounting  firm of the Net Earnings and of the  Employees  contingent
          compensation,  made in the  manner  herein  provided,  shall be in all
          respects  final and binding upon the Company,  upon the Employee,  and
          upon all others,  and the Company shall pay such  compensation  to the
          Employee within 120 days of the end of the fiscal year in question.

               For  the   purpose   of   computing   the   Employee   contingent
          compensation,  the  Adjusted  Net  Earnings  of the  Company  and  its
          subsidiaries  for the above mentioned period shall be the consolidated
          net earnings of the Company and its subsidiaries  for such period,  as
          audited and reported  upon,  for the purposes of the Company's  annual
          report to stockholders for such period,  by the Company's  independent
          auditors,  plus all amounts  charged  against  such  consolidated  net
          earnings in respect of the following:

                    (i)  Taxes of the  United  States  and  foreign  governments
                         (including,  but  without  limitation,  excess  profits
                         taxes) based upon or measured,  in whole or in part, by
                         income of the Company or its subsidiaries but exclusive
                         of sate and  territorial  taxes  and taxes  imposed  by
                         political subdivisions thereof;

                    (ii) Contingent  compensation,  if any, which may be payable
                         by the Company under any plan or  agreement,  including
                         this  Agreement,   other  than  a  profit-sharing  plan
                         qualified under


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<PAGE>


                         Section  401  of  the  Internal  Revenue  Code  or  any
                         statutory provision that may  hereafter  be enacted  to
                         replace such section;

                   (iii) All items of non-recurring loss or other  extraordinary
                         charge which,  by reason of size,  character,  or other
                         factors did not, in the sole and uncontrolled  judgment
                         of the Board of  Directors,  arise in the  ordinary and
                         usual  course of the  business  of the  Company and its
                         subsidiaries,  including expenses properly attributable
                         to such loss or charge;

          less, however,  all amounts included in such consolidated net earnings
          in respect of items of capital gain,  non-recurring  profit,  or other
          extraordinary  credit which,  by reason of size,  character,  or other
          factors did not, in the sole and uncontrolled judgment of the Board of
          Directors,  arise in the  ordinary and usual course of business of the
          Company  and  its  subsidiaries,  after  deducting  expenses  properly
          attributable to such gain, profit, or credit, except and to the extent
          that the Board of Directors,  in its sole and  uncontrolled  judgment,
          shall find that the Employee was responsible for such gain, profit, or
          credit and shall direct the  inclusion,  in whole or in part,  of such
          gain,  profit,  or  credit  in the  computation  of  consolidated  net
          earnings.

          5.3  Stock Options.

               The Company will grant  Employee an  aggregate  of 240,000  stock
          options from its 1997 Equity Incentive Plan (the "Plan"). Such options
          shall be "incentive  stock  options" to the extent  permissible  under
          rules and regulations of the Internal Revenue Service or Non-Qualified
          Option and shall vest 50% upon the signing of this Amendment; 25% upon
          the  first  anniversary  of the grant of the  option  and 25% upon the
          second anniversary of the grant of the option, provided the Employee's
          employment has not been terminated under Section 8.4 of this Agreement
          prior to the date of such vesting."

D.   EFFECT OF ORIGINAL AGREEMENT.

     Except as  supplemented  and amended by this Amendment and such  conforming
changes as necessary to reflect the modification  herein,  all of the provisions
of the Original  Agreement  shall remain in full force and effect from and after
the effective date of this Amendment.


                            [SIGNATURE PAGE FOLLOWS]


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<PAGE>


     This  Amendment  has been duly  authorized  and  approved  by all  required
corporate  action  by the  Company  and  does not  violate  the  certificate  of
incorporation or by-laws of the Company.


                                             Q-MED, INC.

         [CORPORATE SEAL]

                                             By: /s/ Richard I. Levin
                                                ------------------------------
                                                Richard I. Levin, Vice President


ATTEST:



/s/ Herbert H. Sommer
----------------------------------
Herbert H. Sommer
Secretary
                                             EMPLOYEE:



                                             /s/ Michael W. Cox
                                                ------------------------------
                                             Michael W. Cox


                                             Annual Report 1998 - Page 1



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