Exhibit 99.1

                                  RISK FACTORS

The risks described below may not be the only risks we face. Additional risks
that we do not yet know of or that we currently think are immaterial may also
impair our business operations. If any of the events or circumstances described
in the following risk factors actually occurs, our business, financial condition
or results of operations could suffer, and the trading price of our common stock
could decline.

RISKS RELATED TO OUR BUSINESS

If we fail to comply with the terms of our settlement agreement with the
government, we could be subject to additional litigation or other governmental
actions which could be harmful to our business.

On December 28, 2001, we entered into a settlement with the US Department of
Justice ("DOJ"), the US Attorney for the Southern District of New York, the US
Attorney for the Middle District of Florida and the US Department of Health and
Human Services, Office of the Inspector General, in connection with all federal
investigations and legal proceedings related to whistleblower lawsuits
previously pending against us in the US District Court for the Southern District
of New York and the US District Court for the District of Columbia. These
lawsuits included allegations that we improperly caused our hospital customers
to seek reimbursement for a portion of our management fees that included costs
related to advertising and marketing activities by our personnel and allegations
that we violated the federal anti-kickback law and the federal False Claims Act.
Under the terms of the settlement, the lawsuits were dismissed, the United
States and the whistleblowers released us from the claims asserted in the
lawsuits, and we agreed to pay to the United States a $9.0 million initial
payment, with an additional $7.5 million to be paid over the next four years. As
of December 31, 2003, a balance of approximately $4.0 million was outstanding on
this obligation. Pursuant to the settlement, we will be required to fulfill
certain additional obligations, including abiding by a five-year Corporate
Integrity Agreement, avoiding violations of law and providing certain
information to the DOJ from time to time. If we fail or if we are accused of
failing to comply with the terms of the settlement, we may be subject to
additional litigation or other governmental actions, including our Specialty
Healthcare Services business unit being barred from participating in the
Medicare program and other federal health care programs. In addition, as part of
the settlement, we consented to the entry of a judgment against us for $28.0
million, less any amounts previously paid under the settlement, that would be
imposed only if we fail to comply with the terms of the settlement, which, if
required to be paid, could have a material adverse effect on our financial
position. In July 2002, we settled a shareholders' class action suit for $10.5
million that had been consolidated from four lawsuits involving allegations
stemming from the whistleblower lawsuits and DOJ investigations.

We are involved in litigation which may harm the value of our business.

In the normal course of our business, we are involved in lawsuits, claims,
audits and investigations, including any arising out of services or products
provided by or to our operations, personal injury claims, employment disputes
and contractual claims, the outcome of which, in our opinion, will not have a
material adverse effect on our financial position or results of operations.
However, we may become subject to future lawsuits, claims, audits and
investigations that could result in substantial costs and divert our attention
and resources. In addition, since our current growth strategy includes
acquisitions, among other things, we may become exposed to legal claims for the
activities of an acquired business prior to the respective acquisition.


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A substantial percentage of our revenue is attributable to the Medicaid and
Medicare programs. Our business could be significantly impacted by changes in
reimbursement policies and other legislative or regulatory initiatives aimed at
reducing costs associated with these government programs.

In the year ended December 31, 2003, approximately 51% of our Specialty Pharmacy
Services revenues were derived from products and/or services provided to
patients covered under various state Medicaid programs, most of which were from
California, and approximately 6.5% of our Specialty Pharmacy Services revenues
were derived from products and/or services provided to patients covered under
the Medicare program As a result of our specialty pharmacy business
acquisitions, we expect the percentage of our revenues attributable to federal
and state programs to increase. Such programs are highly regulated and subject
to frequent and substantial changes and cost-containment measures that may limit
and reduce payments to providers. Currently, many states are experiencing budget
deficits that may require future reductions in health care related expenditures.
According to a Kaiser Family Foundation report issued in September 2003, all 50
states and the District of Columbia implemented Medicaid cost containment
measures in fiscal year 2003, and each of these states planned to put in
additional spending constraints in fiscal year 2004. State cost containment
activity continued to focus heavily on reducing provider payments and
controlling prescription drug spending.

In December 2003, the Medicare Prescription Drug Improvement and Modernization
Act of 2003 ("MMA") was signed into federal law, providing for a Medicare
prescription drug benefit and other changes to the Medicare program, including
changes to payment methodologies for products we distribute that are covered by
Medicare. Prior to MMA, Medicare reimbursement for many of the products we
distribute was based on 95% of the products' average wholesale price ("AWP").
Under MMA, Medicare reimbursement for many of the products we distribute,
including most physician-administered drugs and biologicals, was lowered to
80-85% of AWP effective January 1, 2004. This 2004 change did not affect
Medicare reimbursement for blood-clotting factors, which will continue to be
reimbursed at 95% of AWP during 2004. Effective January 1, 2005, the Medicare
reimbursement methodology for many of the products we distribute (including
blood-clotting factors) will change from an AWP-based system to a "market-based
system" which we anticipate will lower Medicare reimbursement. It is also
possible that states and/or commercial payors may adopt the new Medicare "market
based" reimbursement methodologies. Therefore, the conversion to a "market-based
system" could have a material adverse effect on our financial position. In
addition, MMA changes the relationship between the Medicare and Medicaid
programs such that we or our customers may receive less reimbursement in the
future for individuals who receive benefits under both of these programs. We are
in the process of evaluating the impact MMA may have on our financial position
or results of operations, and this assessment may require us to expend time and
resources.

In addition to these federal initiatives, many states are also making
modifications to the manner with which they reimburse providers of pharmacy
services. For example, in California, where approximately 30% of our revenues
are derived from the California stated funded health programs, the state
legislature in 2003 passed legislation that modifies the reimbursement
methodology for blood-clotting factors under various California state funded
health programs. Under the new reimbursement methodology, blood-clotting factor
products will be reimbursed based upon Average Selling Price, as provided by the
manufacturers, plus 20%. More recently, California Governor Schwarzenegger
recently proposed additional cuts to California's Medicaid program ("Medi-Cal")
that may lower reimbursement for our products for which we are directly
reimbursed and for which our customers are reimbursed in California, as well as
limit enrollment in the Medi-Cal program. We are in the process of evaluating
the impact these legislative initiatives may have on our financial position or
results of operations.


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We have recently experienced, and expect to continue to experience, rapid growth
by acquisitions. If we are unable to manage our growth effectively or to
purchase or integrate new companies, our business could be harmed.

Our growth strategy will likely strain our resources, and, if we cannot
effectively manage our growth, our business could be harmed. In connection with
our growth strategy, we will likely experience a large increase in the number of
our employees, the size of our programs and the scope of our operations. Our
ability to manage this growth and to be successful in the future will depend
partly on our ability to retain skilled employees, enhance our management team
and improve our management information and financial control systems.

As part of our growth strategy, we continue to evaluate acquisition
opportunities. Acquisitions involve many risks, including the following:

      o     Since the specialty pharmacy services industry is undergoing
            consolidation, we may experience difficulty in identifying suitable
            candidates and negotiating and consummating acquisitions on
            attractive terms, if at all.

      o     In the industry in which our Specialty Pharmacy Services business
            unit operates, customers have a strong affiliation with their
            community-based representatives; accordingly, we may experience
            difficulty in retaining and assimilating the community-based
            representatives of companies we acquire.

      o     Because of the relationships between community-based representatives
            and customers, the loss of a single community-based representative
            may entail the loss of a significant number of customers;
            accordingly, we are subject to a significant potential for loss of
            customers during the periods in which we attempt to integrate newly
            acquired businesses.

      o     Our operational, financial and management systems may be
            incompatible with or inadequate to cost effectively integrate and
            manage the acquired systems. As a result, billing practices could be
            interrupted, and cash collections on the newly acquired business
            could be delayed pending conversion of patient files onto our
            billing systems and receipt of provider numbers from government
            payors.

      o     A growth strategy that involves significant acquisitions diverts our
            management's attention from existing operations.

      o     Acquisitions may involve significant transaction costs which we may
            not be able to recoup.

      o     We may not be able to integrate newly acquired businesses
            appropriately.

In addition, we may become subject to litigation and other liabilities resulting
from the conduct of an acquired business prior to their acquisition by us.

Our growth strategy includes acquisitions. If we fail to implement our
acquisition growth strategy as intended, or incur unknown liabilities for the
past practices of acquired companies, our results of operations could be
adversely affected.

An element of the growth strategy of our Specialty Pharmacy Services business
unit is expansion through the acquisition of complementary businesses. Our
competitors may acquire or seek to acquire many of the businesses that would
also be suitable acquisition candidates for us. This competition could limit our
ability to grow by acquisition or increase the cost of our acquisitions. We
cannot assure you that we will be able to acquire any complementary businesses
that meet our target criteria on satisfactory terms, or at all.

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We may acquire businesses with significant unknown or contingent liabilities,
including liabilities for failure to comply with health care or reimbursement
laws and regulations. We have policies to conform the practices of acquired
businesses to our standards and applicable laws and generally intend to seek
indemnification from prospective sellers covering these matters. We may,
however, incur material liabilities for past activities of acquired businesses.
For example, shortly after our acquisition of certain assets from Prescription
City, Inc., our pharmacy in Spring Valley, New York, was served with a search
warrant issued by a U.S. Magistrate Judge for the Southern District of New York
relating to a criminal investigation. The government has informed us that we are
not a target of this investigation, but we anticipate that this investigation
will reduce revenues from our oncology related pharmaceuticals business, and
could cause us to incur substantial costs and divert the attention of our
management.

While we generally obtain contractual rights to indemnification from owners of
the businesses we acquire, our ability to realize on any indemnification claims
will depend on many factors, including, among other things, the availability of
assets of the indemnifying parties. These indemnifying parties are often
individuals who may not have the resources to satisfy an indemnification claim.

We operate in a rapidly changing and consolidating competitive environment. If
we are unable to adapt quickly to these changes, our business and results of
operations could be seriously harmed.

The specialty pharmacy industry is experiencing rapid consolidation. We believe
that technological and regulatory changes will continue to attract new entrants
to the market. Industry consolidation among our competitors may increase their
financial resources, enabling them to compete more effectively based on price
and services offered. This could require us either to reduce our prices or
increase our service levels, or risk losing market share. Moreover, industry
consolidation may result in stronger competitors that are better able to
compete. If we are unable to effectively execute our growth strategy, our
ability to compete in a rapidly changing and consolidating specialty pharmacy
industry may be negatively impacted.

The anticipated benefits of combining Curative and Critical Care Systems, Inc.
(CCS") may not be realized.

Curative is purchasing CCS with the expectation that the combination of both
companies will result in various benefits including, among other things,
benefits relating to increased infrastructure of added pharmacies, increased
leverage with greater number of payor contracts, an essential and demonstrably
cost-effective therapy offering, increased clinical backbone and expertise, cost
savings and operating efficiencies. There can be no assurance that we will
realize any of these benefits or that the acquisition will not result in the
deterioration or loss of significant business of the combined company. Costs
incurred and liabilities assumed in connection with the acquisition, including
pending and/or threatened disputes and litigation, could have a material adverse
effect on the combined company's business, financial condition and operating
results.

Curative may have difficulty and incur substantial costs in integrating CCS.

Integrating Curative and CCS will be a complex, time-consuming and expensive
process. Before the acquisition, Curative and CCS operated independently, each
with its own business, products, customers, employees, culture and systems. The
combined company may face substantial difficulties, costs and delays in
integrating Curative and CCS. These factors may include:

      o     potential difficulty in leveraging the value of the separate
            technologies of the combined company;

      o     perceived adverse changes in product offerings available to
            customers or customer service standards, whether or not these
            changes do, in fact, occur;

      o     managing patient and payor overlap and potential pricing conflicts;

      o     costs and delays in implementing common systems and procedures;

      o     difficulty integrating differing distribution models;


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<PAGE>

      o     difficulty comparing financial reports due to differing management
            systems;

      o     diversion of management resources from the business of the combined
            company;

      o     potential incompatibility of business cultures and philosophies;

      o     reduction or loss of revenue due to the potential for market
            confusion, hesitation and delay;

      o     retaining and integrating management and other key employees of the
            combined company; and

      o     coordinating infrastructure operations in an effective and efficient
            manner.

After the acquisition, we may seek to combine certain operations and functions
using common information and communication systems, operating procedures,
financial controls and human resource practices. We may be unsuccessful in
implementing the integration of these systems and processes.

Any one or all of these factors may cause increased operating costs, worse than
anticipated financial performance or the loss of patients and payor contracts.
Many of these factors are also outside the control of either company. The
failure to effectively and efficiently integrate Curative and CCS could have a
material adverse effect on the combined company's business, financial condition
and operating results.

We may need additional capital to finance our growth and capital requirements,
which could prevent us from fully pursuing our growth strategy.

In order to implement our present growth strategy, we may need substantial
capital resources and may incur, from time to time, short- and long-term
indebtedness, the terms of which will depend on market and other conditions. Due
to uncertainties inherent in the capital markets (e.g., availability of capital,
fluctuation of interest rates, etc.), we cannot be certain that existing or
additional financing will be available to us on acceptable terms, if at all.
Even if we are able to obtain additional debt financing, we may incur additional
interest expense, which may decrease our earnings, or we may become subject to
contracts that restrict our operations. As a result, we could be unable to fully
pursue our growth strategy. Further, additional financing may involve the
issuance of equity securities that would dilute the interests of our existing
shareholders and potentially decrease the market price of our common stock.

An impairment of the significant amount of goodwill on our financial statements
could adversely affect our financial position and results of operations.

Our Specialty Pharmacy Services acquisitions resulted in the recording of a
significant amount of goodwill on our financial statements. The goodwill was
recorded because the fair value of the net assets acquired was less than the
purchase price. We may not realize the full value of this goodwill. As such, we
evaluate on at least an annual basis whether events and circumstances indicate
that all or some of the carrying value of goodwill is no longer recoverable, in
which case we would write off the unrecoverable goodwill as a charge against our
earnings.

Since our growth strategy will likely involve the acquisition of other
companies, we may record additional goodwill in the future. The possible
write-off of this goodwill could negatively impact our future earnings. We will
also be required to allocate a portion of the purchase price of any acquisition
to the value of any intangible assets that meet the criteria specified in the
Statement of Financial Accounting Standards No. 141, "Business Combinations,"
such as marketing, customer or contract-based intangibles. The amount allocated
to these intangible assets could be amortized over a fairly short period, which
may negatively affect our earnings or the market price of our common stock.

As of December 31, 2003, we had goodwill of approximately $147.9 million, or 63%
of our total assets and approximately 103% of shareholders' equity.


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We are highly dependent on our relationships with a limited number of
biopharmaceutical and pharmaceutical suppliers, and the loss of any of these
relationships could significantly affect our ability to sustain or grow our
revenues.

The biopharmaceutical and pharmaceutical industries are susceptible to product
shortages. Some of the products that we distribute, such as factor VIII
blood-clotting products and intravenous immune globulins, have experienced
shortages in the past. Suppliers were unable to increase production to meet
rising global demand. Although this shortage has ended, demand continues to
grow. In 2003, approximately 48%, or $88.4 million, of our Specialty Pharmacy
Services revenues were derived from our sale of factor VIII. We purchase our
supplies of blood-clotting products from five suppliers: Baxter Healthcare
Corp., Genetics Institute, Bayer, Novo Nordisk Pharmaceuticals, Inc. and Aventis
Behring L.L.C. We believe that these five suppliers represent substantially all
of the production capacity for recombinant factor VIII. In the event that one of
these suppliers is unable to continue to supply us with products, it is
uncertain whether the remaining suppliers would be able to make up any shortfall
resulting from such inability. Our ability to take on additional customers or to
acquire other specialty pharmacy services businesses with significant hemophilia
customer bases could be affected negatively in the event we are unable to secure
adequate supplies of our products from these suppliers. In addition, MedImmune,
Inc. is the sole source of Synagis(R), a product used to treat respiratory
syncytial virus in infants. For the year ended December 31, 2003, approximately
20%, or $37.1 million, of our Specialty Pharmacy Services revenues was derived
from our sale of Synagis(R). MedImmune's failure to provide us with an adequate
supply of Synagis(R) product for any reason could impair our ability to add and
service patients. In particular, respiratory syncytial virus occurs primarily
during the winter months and thus the demand for Synagis(R) is greater during
this time. A shortage in the supply of Synagis(R) or our failure to adequately
plan for the demand could adversely affect our financial results. Under our
existing arrangements with MedImmune, we are non-exclusive distributors of
Synagis(R) and MedImmune, Inc. has no obligation to supply us with a minimum
amount of Synagis(R). If these products, or any of the other drugs or products
that we distribute, are in short supply for long periods of time, our business
could be harmed.

Some biopharmaceutical suppliers in the specialty pharmacy industry have chosen
to limit the number of distributors of their products. If we are not selected as
a preferred distributor of one or more of our core products, our business and
results of operations could be seriously harmed.

We have identified a trend among some of our suppliers toward the retention of a
limited number of preferred distributors to market certain of their
biopharmaceutical products. If this trend continues, we cannot be certain that
we will be selected and retained as a preferred distributor or can remain a
preferred distributor to market these products. Although we believe we can
effectively meet our suppliers' requirements, there can be no assurance that we
will be able to compete effectively with other specialty pharmacy companies to
retain our position as a distributor of each of our core products. Adverse
developments with respect to this trend could have a material adverse effect on
our business and results of operations.

The seasonal nature of a portion of our business may cause significant
fluctuations in our quarterly operating results.

For the year ended December 31, 2003, approximately 20%, or $37.1 million, of
our Specialty Pharmacy Services revenues was derived from our sale of
Synagis(R). Synagis(R) is used to prevent respiratory syncytial virus in
infants. As respiratory syncytial virus occurs primarily during the winter
months, the major portion of our Synagis(R) sales may be higher during the first
and fourth quarters of the calendar year which may result in significant
fluctuations in our quarterly operating results.

If we fail to cultivate new or maintain established relationships with the
physician referral sources, our revenues may decline.

Our success, in part, is dependent upon referrals and our ability to maintain
good relations with physician referral sources. Physicians referring patients to
us are not our employees and are free to refer their patients to our
competitors. If we are unable to successfully cultivate new referral sources and
maintain strong relationships with our current referral sources, our revenues
may decline.


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If additional providers obtain access to products we handle at more favorable
prices, our business could be harmed.

Because we do not receive federal grants under the Public Health Service Act, we
are not eligible to participate directly in a federal pricing program
administered by the Federal Health Resources and Services Administration's
Public Health Service, which allows certain entities with such grants, such as
certain hospitals and hemophilia treatment centers, to obtain discounts on
drugs, including certain biopharmaceutical products (e.g., hemophilia-clotting
factor and intravenous immune globulins) that represented 61% of our total
company revenues at December 31, 2003. To the best of our knowledge, these
entities benefit by being able to acquire, pursuant to this federal program,
products competitive with ours at prices lower than our cost for the same
products. Our customers, where eligible, may elect to obtain hemophilia-clotting
factor, or other products, from such lower-cost entities, which could result in
a reduction of revenue to us.

Recent investigations into reporting of average wholesale prices could reduce
our pricing and margins.

Many government payors, including Medicare (in 2004) and many state Medicaid
programs, as well as a number of private payors, pay us directly or indirectly
based upon a drug's AWP. In fact, most of Specialty Pharmacy Services' revenues
result from reimbursement methodologies based on the AWP of our products. The
AWP for most drugs is compiled and published by third-party price reporting
services, such as First DataBank, Inc., from information provided by
manufacturers and/or wholesalers. Various federal and state government agencies
have been investigating, among other things, whether the published AWP of many
drugs, including some that we distribute and sell, is an appropriate or accurate
measure of the market price of the drugs. There are also several lawsuits
pending against various drug manufacturers in connection with the
appropriateness of the manufacturers' AWP for a particular drug(s). These
government investigations and lawsuits involve allegations that manufacturers
reported artificially inflated AWPs of various drugs to third-party price
reporting services, which, in turn, reported these prices to its subscribers,
including many state Medicaid agencies who then included these AWPs in the
state's reimbursement policies.

As a result of this enforcement environment, it is possible that manufacturers
and/or third-party price reporting services may lower the reported AWP for
products that we distribute and sell. The changes occurring in the reporting of
AWPs could have a negative effect on our business by reducing the pricing and
margins on certain of our products.

Moreover, as discussed above, as a result of MMA, Medicare reimbursement for
many of the products we distribute, including most physician-administered drugs
and biologicals, was lowered to 80-85% of AWP effective January 1, 2004.
Although this 2004 change did not affect Medicare reimbursement for
blood-clotting factors, which will continue to be reimbursed at 95% of AWP in
2004, effective January 1, 2005, the Medicare reimbursement methodology for many
of the products we distribute (including blood-clotting factors) will change
from an AWP-based system to a "market-based system," which we anticipate will
lower Medicare reimbursement, It is also possible that states and/or commercial
payors may adopt the new Medicare "market-based" reimbursement methodology.

A reduction in the demand for our products and services could result in our
reducing the pricing and margins on certain of our products.

A number of circumstances could reduce demand for our products and services
including:

      o     customer shifts to treatment regimens other than those we offer;

      o     new treatments or methods of delivery of existing drugs that do not
            require our specialty products and services;

      o     the recall of a drug, or adverse reactions caused by a drug;

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      o     the expiration or challenge of a drug patent;

      o     competing treatment from a new drug, a new use of an existing drug
            or genetic therapy;

      o     drug companies ceasing to develop, supply and generate demand for
            drugs that are compatible with the services we provide;

      o     drug companies stopping outsourcing the services we provide or
            failing to support existing drugs or develop new drugs;

      o     governmental or private initiatives that would alter how drug
            manufacturers, health care providers or pharmacies promote or sell
            products and services;

      o     the loss of a managed care or other payor relationship covering a
            number of high-revenue customers; or

      o     the cure of a disease we service.

Our business involves risks of professional, product and hazardous substance
liability, and any inability to obtain adequate insurance may adversely affect
our business.

The provision of health services entails an inherent risk of professional
malpractice, regulatory violations and other similar claims. Claims, suits or
complaints relating to health services and products provided by physicians,
pharmacists or nurses in connection with our Specialty Pharmacy Services and
Specialty Healthcare Services programs may be asserted against us in the future.

Our operations involve the handling of bio-hazardous materials. Our employees,
like those of all companies that provide services dealing with human blood
specimens, may be exposed to risks of infection from AIDS, hepatitis and other
blood-borne diseases if appropriate laboratory practices are not followed.
Although we believe that our safety procedures for handling and disposing of
such materials comply with the standards prescribed by state and federal
regulations, we cannot completely eliminate the risk of accidental infection or
injury from these materials. In the event of such an accident, we could be held
liable for any damages that result, and such liability could harm our business.

Our operations expose us to product and professional liability risks that are
inherent in managing the delivery of wound care services and the provision and
marketing of biopharmaceutical and pharmaceutical products. We currently
maintain professional and product liability insurance coverage of $25 million in
the aggregate. Because we cannot predict the nature of future claims that may be
made, we cannot assure you that the coverage limits of our insurance would be
adequate to protect us against any potential claims, including claims based upon
the transmission of infectious disease, contaminated products or otherwise. In
addition, we may not be able to obtain or maintain professional or product
liability insurance in the future on acceptable terms, if at all, or with
adequate coverage against potential liabilities.

We rely on key community-based representatives whose absence or loss could harm
our business.

The success of our Specialty Pharmacy Services business unit depends upon our
ability to retain key employees known as community-based representatives, and
the loss of their services could adversely affect our business and prospects.
Our community-based representatives are our chief contacts and maintain the
primary relationship with our customers, and the loss of a single
community-based representative could result in the loss of a significant number
of customers. We do not have key person insurance on any of our community-based
representatives. In addition, our success will depend upon, among other things,
the successful recruitment and retention of qualified personnel, and we may not
be able to retain all of our key management personnel or be successful in
recruiting additional replacements should that become necessary.


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<PAGE>

Our inability to maintain a number of important contractual relationships could
adversely affect our operations.

Substantially all of the revenues of our Specialty Healthcare Services
operations are derived from management contracts with acute care hospitals. At
December 31, 2003, we had 86 management contracts. The contracts
generally have initial terms of three to five years, and many have automatic
renewal terms unless specifically terminated. During the year ending December
31, 2004, the contract terms of 36 of our management contracts will expire,
including 24 contracts which provide for automatic one-year renewals. The
contracts often provide for early termination either by the client hospital if
specified performance criteria are not satisfied, or by us under various other
circumstances. Historically, some contracts have expired without renewal, and
others have been terminated by us or the client hospital for various reasons
prior to their scheduled expiration. During 2003, three contracts expired
without renewal, and an additional eight contracts were terminated prior to
their scheduled expiration. Generally, these contracts were terminated by
hospitals because of the now settled DOJ investigation of Specialty Healthcare
Services, hospital financial difficulties and Medicare reimbursement changes
which reduced hospital revenues. Our continued success is subject to, among
other things, our ability to renew or extend existing management contracts and
obtain new management contracts. Any hospital may decide not to continue to do
business with us following expiration of its management contract, or earlier if
such management contract is terminable prior to expiration. In addition, any
changes in the Medicare program or third-party reimbursement levels which
generally have the effect of limiting or reducing reimbursement levels for
health services provided by programs managed by us could result in the early
termination of existing management contracts and could adversely affect our
ability to renew or extend existing management contracts and to obtain new
management contracts. The termination or non-renewal of a material number of
management contracts could harm our business.

In addition, a portion of the revenues of our Specialty Pharmacy Services
operations is derived from contractual relationships with retail pharmacies. Our
success is subject to, among other things, the continuation of these
relationships, and termination of one or more of these relationships could harm
our business.

Our business will suffer if we lose relationships with payors.

We are partially dependent on reimbursement from non-governmental payors. Many
payors seek to limit the number of providers that supply drugs to their
enrollees. From time to time, payors with whom we have relationships require
that we and our competitors bid to keep their business, and, therefore, due to
the uncertainties involved in any bidding process, we either may not be retained
or may have to reduce our margins to retain business. The loss of a significant
number of payor relationships, or an adverse change in the financial condition
of a significant number of payors, could result in the loss of a significant
number of patients and harm our business.

Changes in reimbursement rates which cause reductions in the revenues of our
operations have adversely affected our Specialty Healthcare Services business
unit.

As a result of the Balanced Budget Act of 1997, the Centers for Medicare &
Medicaid Services ("CMS") (formerly Health Care Financing Administration)
implemented the Outpatient Prospective Payment System ("OPPS") for most hospital
outpatient department services furnished to Medicare patients beginning August
2000. Under OPPS, a predetermined rate is paid to each hospital for clinical
services rendered, regardless of the hospital's cost. We believe the new payment
system does not provide comparable reimbursement for services previously
reimbursed on a reasonable cost basis, and we believe the payment rates for many
services are insufficient for many of our hospital customers, resulting in
revenue and income shortfalls for the Wound Care Center(R) programs we manage on
behalf of the hospitals. As a result, during 2003 and 2002, we renegotiated and
modified many of our management contracts related to our Specialty Healthcare
Services business unit, which has resulted in reduced revenue and income to us
from those modified contracts and, in numerous cases, contract termination.
These renegotiations resulted in reduced revenues of approximately $1.2 million
in the year ended December 31, 2003. In addition, we lost approximately $6.5
million in revenues in the year ended December 31, 2003 as the result of
contract terminations. At any time during any given year, 10% to 20% of hospital
contracts are being renegotiated.


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<PAGE>

We expect that contract renegotiation and modification with many of our hospital
customers will continue, and this could result in further reduced revenues and
income to us from those contracts and even contract terminations. These results
could harm our business.

The Wound Care Center programs managed by our Specialty Healthcare Services
business unit on behalf of acute care hospitals are generally treated as
"provider based entities" for Medicare reimbursement purposes. This designation
is required for the hospital-based program to be covered under the Medicare
outpatient reimbursement system. With OPPS, Medicare published criteria for
determining when programs may be designated "provider based entities." Programs
that existed prior to October 1, 2000 are grandfathered by CMS to be "provider
based entities" until the start of the hospital's next cost-reporting period
beginning on or after July 1, 2003. At that time, the hospital may submit an
attestation to the appropriate CMS Regional Office, attesting that the program
meets all the requirements for provider-based designation. Programs that started
on or after October 1, 2000 can voluntarily apply for provider based designation
status. We timely advised each of our hospital clients of the mandatory
application procedures. Although we believe that the remainder of the programs
we manage substantially meet the current criteria to be designated "provider
based entities," a widespread denial of such designation could harm our
business.

Increased competition for patients may result in reduced rates of reimbursement,
which may then cause reductions in reimbursement amounts payable to us by
providers.

In recent years, competition for patients, efforts by traditional third-party
payors to contain or reduce health care costs, and the increasing influence of
managed care payors, such as health maintenance organizations, have resulted in
reduced rates of reimbursement. If these trends continue, they could harm our
business. The profitability of our Specialty Pharmacy Services operations
depends on reimbursement from third-party payors because our customers seek
reimbursement from third-party payors for the cost of drugs and related medical
supplies that we distribute. Changes in reimbursement policies of private and
governmental third-party payors, including policies relating to the Medicare,
Medicaid and other federally funded programs, could reduce the amounts
reimbursed to these customers for our products and, in turn, the amount these
customers would be willing to pay for our products and services. In addition,
where we have direct relationships with payors, changes in their reimbursement
policies may reduce amounts payable directly to us by such payors. Changes in
those reimbursement policies could affect our customers, which in turn could
harm our business.

We are subject to pricing pressures and other risks involved with commercial
payors.

Commercial payors, such as managed care organizations and traditional indemnity
insurers, increasingly are requesting fee structures and other arrangements
providing for health care providers to assume all or a portion of the financial
risk of providing care. The lowering of reimbursement rates, increasing medical
review of bills for services and negotiating for reduced contract rates could
harm our business. Pricing pressures by commercial payors may continue, and
these trends may adversely affect our business.

Also, continued growth in managed care and capitated plans have pressured health
care providers to find ways of becoming more cost competitive. Managed care
organizations have grown substantially in terms of the percentage of the
population they cover and in terms of the portion of the health care economy
they control. Managed care organizations have continued to consolidate to
enhance their ability to influence the delivery of health care services and to
exert pressure to control health care costs. A rapid increase in the percentage
of revenue derived from managed care payors or under capitated arrangements
without a corresponding decrease in our operating costs could harm our business.


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There is substantial competition in our industry, and we may not be able to
compete successfully.

Our Specialty Pharmacy Services business unit faces competition from other
disease management entities, general health care facilities and service
providers, biopharmaceutical companies, pharmaceutical companies as well as
other competitors. Many of these companies have substantially greater capital
resources and marketing staffs and greater experience in commercializing
products and services than we have. The principal competition with our Specialty
Healthcare Services business unit consists of specialty clinics that have been
established by some hospitals or physicians. Additionally, there are some
private companies which provide wound care services through a hyperbaric oxygen
therapy program format. In addition, recently developed technologies, or
technologies that may be developed in the future, are or may be the basis for
products which compete with our chronic wound care services. We may not be able
to enter into co-marketing arrangements with respect to these products, and we
may not be able to compete effectively against such companies in the future.

If we are unable to effectively adapt to changes in the health care industry,
our business will be harmed.

Political, economic and regulatory influences are subjecting the health care
industry in the United States to fundamental change. We anticipate that Congress
and state legislatures may continue to review and assess alternative health care
delivery and payment systems and may in the future propose and adopt legislation
effecting fundamental changes in the health care delivery system as well as
changes to Medicare's coverage and payments of the drugs and services we
provide.

As discussed above, in December 2003, MMA was signed into law, substantially
changing the Medicare reimbursement system insofar as it pertains to
biopharmaceuticals and drugs, as well as enacting various other changes to the
Medicare program. It is possible that MMA, as well as any future legislation
enacted by Congress or state legislatures, could harm our business or could
change the operating environment of our targeted customers (including hospitals
and managed care organizations). Health care industry participants may react to
such legislation by curtailing or deferring expenditures and initiatives,
including those relating to our programs and services. It is possible that the
changes to the Medicare program reimbursement may serve as precedent to possible
changes in other payor's reimbursement policies in a manner adverse to us. In
addition, MMA and its related regulatory changes could encourage integration or
reorganization of the health care delivery system in a manner that could
materially and adversely affect our ability to compete or to continue our
operations without substantial changes.

Our industry is subject to extensive government regulation, and noncompliance by
us, our suppliers, our customers or our referral sources could harm our
business.

The marketing, labeling, dispensing, storage, provision, sale and purchase of
drugs, health supplies and health services, including the biopharmaceutical and
pharmaceutical products we provide, are extensively regulated by federal and
state governments, and if we fail or are accused of failing to comply with laws
and regulations, our business could be harmed. Our business could also be harmed
if the suppliers, customers or referral sources we work with are accused of
violating laws or regulations. The applicable regulatory framework is complex,
and the laws are very broad in scope. Many of these laws remain open to
interpretation and have not been addressed by substantive court decisions. The
federal government or states in which we operate could, in the future, enact
more restrictive legislation or interpret existing laws and regulations in a
manner that could limit the manner in which we can operate our business and have
a negative impact on our business.

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<PAGE>

There are a number of state and federal laws and regulations that apply to our
operations which could harm our business.

A number of state and federal laws and regulations apply to, and could harm, our
business. These laws and regulations include, among other things, the following:

      o     The federal "anti-kickback law" prohibits the offer or solicitation
            of remuneration in return for the referral of patients covered by
            almost all governmental programs, or the arrangement or
            recommendation of the purchase of any item, facility or service
            covered by those programs. The Health Insurance Portability and
            Accountability Act of 1996, or HIPAA, created new violations for
            fraudulent activity applicable to both public and private health
            care benefit programs and prohibits inducements to Medicare or
            Medicaid eligible patients to influence their decision to seek
            specific items and services reimbursed by the government or to
            choose a particular provider. The potential sanctions for violations
            of these laws include significant fines, exclusion from
            participation in Medicare and Medicaid and criminal sanctions.
            Although some "safe harbor" regulations attempt to clarify when an
            arrangement will not violate the anti-kickback law, our business
            arrangements and the services we provide may not fit within these
            safe harbors. Failure to satisfy a safe harbor requires further
            analysis of whether the parties violated the anti-kickback law. In
            addition to the anti-kickback law, many states have adopted similar
            kickback and/or fee-splitting laws, which can affect the financial
            relationships we may have with our customers, physicians, vendors,
            other retail pharmacies and patients. The finding of a violation of
            the federal laws or one of these state laws could harm our business.

      o     The Department of Health and Human Services has issued final
            regulations implementing the Administrative Simplification
            Provisions of HIPAA concerning the maintenance, transmission, and
            security of individually identifiable health information. The
            privacy regulations, with which compliance was required as of April
            2003, impose on covered entities (including hospitals, pharmacies,
            and other health care providers) significant new restrictions on the
            use and disclosure of individually identifiable health information.
            The security regulations, which require compliance by April 2005,
            will impose on covered entities certain administrative, technical,
            and physical safeguard requirements with respect to individually
            identifiable health information maintained or transmitted
            electronically. The regulations establishing electronic transaction
            standards that all health care providers must use when submitting or
            receiving certain health care transactions electronically were to
            become effective October 2002, but Congress extended the compliance
            deadline until October 2003 for organizations, such as ours, that
            submitted a request for an extension. As a result of these HIPAA
            regulations, we have taken the appropriate actions to ensure that
            patient data kept on our computer networks are in compliance with
            these regulations. We believe that we are now substantially in
            compliance with the HIPAA electronic standards and are capable of
            delivering HIPAA standard transactions electronically. In addition,
            if we choose to distribute drugs through new distribution channels,
            such as the Internet, we will have to comply with government
            regulations that apply to those distribution channels, which could
            harm our business. In addition to HIPAA, a number of states have
            adopted laws and/or regulations applicable to the use and disclosure
            of patient health information. The finding of a violation of HIPAA
            or one of these state laws could harm our business.

      o     The Ethics in Patient Referrals Act of 1989, as amended, commonly
            referred to as the "Stark Law," prohibits physician referrals to
            entities with which the physician or his or her immediate family
            members have a "financial relationship" and prohibits the entity
            receiving the referral from presenting a claim to Medicare or
            Medicaid programs for services furnished under the referral. A
            violation of the Stark Law is punishable by civil sanctions,
            including significant fines, a denial of payment or a requirement to
            refund certain amounts collected, and exclusion from participation
            in Medicare and Medicaid. A number of states have adopted laws
            and/or regulations that contain provisions that track, or are
            otherwise similar to, the Stark Law. The finding of a violation of
            the Stark Law or one or more of these state laws could harm our
            business.

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      o     State laws prohibit the practice of medicine, pharmacy and nursing
            without a license. To the extent that we assist patients and
            providers with prescribed treatment programs, a state could consider
            our activities to constitute the practice of medicine. Our nurses
            must obtain state licenses to provide nursing services we provide to
            some of our patients. In addition, in some states, coordination of
            nursing services for patients could necessitate licensure as a home
            health agency and/or could necessitate the need to use licensed
            nurses to provide certain patient-directed services. If we are found
            to have violated those laws, we could face civil and criminal
            penalties and be required to reduce, restructure or even cease our
            business in that state.

      o     Pharmacies (retail, mail-order and wholesale) as well as pharmacists
            often must obtain state licenses to operate and dispense drugs.
            Pharmacies must also obtain licenses in some states in order to
            operate and provide goods and services to residents of those states.
            In addition, our pharmacies may be required by the federal Drug
            Enforcement Agency, as well as by similar state agencies, to obtain
            registration to handle controlled substances, including certain
            prescription drugs, and to follow specified labeling and
            record-keeping requirements for such substances. If we are unable to
            maintain our licenses, or if states place burdensome restrictions or
            limitations on non-resident pharmacies, this could limit or affect
            our ability to operate in some states, which could harm our
            business.

      o     Federal and state investigations and enforcement actions continue to
            focus on the health care industry, scrutinizing a wide range of
            items such as joint venture arrangements, referral and billing
            practices, product discount arrangements, home health care services,
            dissemination of confidential patient information, promotion of
            off-label drug indications use, clinical drug research trials and
            gifts for patients or referral sources. From time to time, and like
            others in the health care industry, we receive requests for
            information from government agencies in connection with their
            regulatory or investigation authority.

      o     We are subject to federal and state laws prohibiting entities and
            individuals from knowingly and willfully making claims to Medicare
            and Medicaid and other governmental programs and third-party payors
            that contain false or fraudulent information. The federal False
            Claims Act encourages private individuals to file suits on behalf of
            the government against health care providers such as us. As such
            suits are generally filed under seal with a court to allow the
            government adequate time to investigate and determine whether it
            will intervene in the action, the health care providers affected are
            often unaware of the suit until the government has made its
            determination and the seal is lifted. Violations or alleged
            violations of such laws, and any related suits, could result in
            significant financial or criminal sanctions (including treble
            damages) or exclusion from participation in the Medicare and
            Medicaid programs.

There is a delay between our performance of services and our reimbursement.

Billing and collection for our services is a complex process requiring constant
attention and involvement by senior management and ongoing enhancements to
information systems and billing center operating procedures.

The health care industry is characterized by delays that typically range from
three to nine months between when services are provided and when the
reimbursement or payment for these services is received. This makes working
capital management, including prompt and diligent billing and collection, an
important factor in our results of operations and liquidity. Trends in the
industry may further extend the collection period and impact our working
capital.


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<PAGE>

We are paid for our services by various payors, including patients, insurance
companies, Medicare, Medicaid and others, each with distinct billing
requirements. We recognize revenue when we provide services to patients.
However, our ability to collect these receivables depends in part on our
submissions to payors of accurate and complete documentation. In order for us to
bill and receive payment for our services, the physician and the patient must
provide appropriate billing information. Following up on incorrect or missing
information generally slows down the billing process and the collection of
accounts receivable. Failure to meet the billing requirements of the different
payors could have a significant impact on our revenues, profitability and cash
flow.

Further, even if our billing procedures comply with all third party-payor
requirements, some of our payors may experience financial difficulties or may
otherwise not pay accounts receivable when due, which could result in increased
write-offs or provisions for doubtful accounts. There can be no assurance that
we will be able to maintain our current levels of collectibility or that
third-party payors will not experience financial difficulties. If we are unable
to collect our accounts receivable on a timely basis, our revenues,
profitability and cash flow could be adversely affected.

We rely heavily on a limited number of shipping providers, and our business
could be harmed if their rates are increased or our providers are unavailable.

A significant portion of our revenues result from the sale of drugs we deliver
to our patients, and a significant amount of our products are delivered by
overnight mail or courier or through our retail pharmacies. The costs incurred
in shipping are not passed on to our customers and, therefore, changes in these
costs directly impact our margins. We depend heavily on these outsourced
shipping services for efficient, cost-effective delivery of our product. The
risks associated with this dependence include: any significant increase in
shipping rates; strikes or other service interruptions by these carriers; and
spoilage of high-cost drugs during shipment since our drugs often require
special handling, such as refrigeration.

If we do not maintain effective and efficient information systems, our
operations may be adversely affected.

Our operations depend in part on the continued and uninterrupted performance of
our information systems. Failure to maintain reliable information systems or
disruptions in our information systems could cause disruptions in our business
operations, including billing and collections, loss of existing patients and
difficulty in attracting new patients, patient and payor disputes, regulatory
problems, increases in administrative expenses or other adverse consequences,
any or all of which could have a material adverse effect on our operations.

RISK RELATED TO OUR COMMON STOCK

Possible volatility of stock price in the public market.

The market price of our common stock has experienced, and may continue to
experience, substantial volatility. Over the past eight quarters, the market
price of our common stock has ranged from a low of $5.20 per share in the second
quarter of 2001 to a high of $22.75 in the first quarter of 2002. Many factors
have influenced the common stock price in the past, including fluctuations in
our earnings and changes in our financial position, management changes, low
trading volume, and negative publicity and uncertainty resulting from the legal
actions brought against us. In addition, the securities markets have, from time
to time, experienced significant broad price and volume fluctuations that may be
unrelated to the operating performance of particular companies. All of these
factors could adversely affect the market price of our common stock.



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Provisions of our articles of incorporation and Minnesota law may make it more
difficult for you to receive a change-in-control premium.

Our Board's ability to designate and issue up to 10 million shares of preferred
stock and issue up to 50 million shares of common stock could adversely affect
the voting power of the holders of common stock, and could have the effect of
making it more difficult for a person to acquire, or could discourage a person
from seeking to acquire, control of our company. If this occurred, you could
lose the opportunity to receive a premium on the sale of your shares in a change
of control transaction.

In addition, the Minnesota Business Corporation Act contains provisions that
would have the effect of restricting, delaying or preventing altogether certain
business combinations with any person who becomes an interested stockholder.
Interested stockholders include, among others, any person who, together with
affiliates and associates, acquires 10 percent or more of a corporation's voting
stock in a transaction which is not approved by a duly constituted committee of
the Board of the corporation. These provisions could also limit your ability to
receive a premium in a change of control transaction.



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