<PAGE>

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

(MARK ONE)
     /X/     QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
             THE SECURITIES EXCHANGE ACT OF 1934
             FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2003
                                       OR
     / /     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: 1-13861
                          MED-EMERG INTERNATIONAL INC.
             (Exact Name of Registrant as Specified in Its Charter)

PROVINCE OF ONTARIO, CANADA
(State or Other Jurisdiction of Incorporation or Organization)

2550 Argentia Road, Suite 205
Mississauga, Ontario, Canada                         L5N 5R1
(Address of Principal Executive Offices)            (Zip Code)

Registrant's telephone number, including area code:  (905) 858-1368

Securities registered or to be registered pursuant to Section 12(g) of the Act.
(Title of each class)                (Name of each exchange on which registered)
COMMON STOCK, NO PAR VALUE            OTC Bulletin Board
REDEEMABLE COMMON STOCK
PURCHASE WARRANTS                     OTC Bulletin Board
Securities for which there is a reporting obligation pursuant to
Section 15(d) of the Act.  NONE

     Indicate by check mark whether the registrant: (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes [X] No [ ]

     Indicate by check mark whether registrant is an accelerated filer (as
defined in Exchange Act Rule 126-2). Yes [ ] No [X]

          The aggregate market value of the shares of Common Stock (based upon
     the closing sales price of the Company's Common Stock as reported on the
     OTC Bulletin Board on Aug 5, 2003) of the registrant held by non-affiliates
     on June 30, 2003 was approximately US$3,903,129.

          As of June 30, 2003, 9,519,828 shares of the registrant's Common Stock
     were outstanding.

(All figures in US dollars unless otherwise indicated.)

<PAGE>

                          MED-EMERG INTERNATIONAL INC.

                   JUNE 30, 2003 QUARTERLY REPORT ON FORM 10-Q
                   -------------------------------------------



                                TABLE OF CONTENTS
                                -----------------


                          PART I: FINANCIAL INFORMATION

Item 1.     Financial Statements

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

Item 3.     Quantitative and Qualitative Disclosures about Market Risk

Item 4.     Controls and Procedures


                           PART II: OTHER INFORMATION

Item 5.     Exhibits and Reports on Form 8-K
            (a) Exhibits
            (b) Reports on Form 8-K

            Signatures

<PAGE>

                SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

     This Quarterly Report on Form 10-Q contains forward-looking statements as
defined by the Private Securities Litigation Reform Act of 1995. Forward-looking
statements include statements concerning plans, objectives, goals, strategies,
future events or performance and underlying assumptions and other statements,
which are other than statements of historical facts. These statements are
subject to uncertainties and risks including, but not limited to, product and
service demand and acceptance, changes in technology, economic conditions, the
impact of competition and pricing, government regulation, and other risks
defined in this document and in statements filed from time to time with the
Securities and Exchange Commission. All such forward-looking statements are
expressly qualified by these cautionary statements and any other cautionary
statements that may accompany the forward-looking statements. In addition, Med
Emerg International Inc. ("MEII" or the "Company") disclaims any obligations to
update any forward-looking statements to reflect events or circumstances after
the date hereof.


PART I:  FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS

Consolidated Balance Sheets as of June 30, 2003 (unaudited) and
December 31, 2002 (audited)

Consolidated Statements of Operations and Deficit for the three and six months
ended June 30, 2003 and 2002 (unaudited)

Consolidated Statement of Cash Flows for the three and six months ended
June 30, 2003 and 2002 (unaudited)

Notes to Unaudited Consolidated Financial Statements

<PAGE>

                          MED-EMERG INTERNATIONAL INC.
                           CONSOLIDATED BALANCE SHEET
         AS AT JUNE 30, 2003 (UNAUDITED) AND DECEMBER 31, 2002 (AUDITED)
                                    (IN US$)

<TABLE>
<CAPTION>

                                                                       JUNE 30             DECEMBER 31
                                                                         2003                  2002
                                                              -----------------------  ---------------------
<S>                                                           <C>                       <C>
ASSETS

CURRENT ASSETS
     Cash                                                     $            487,570      $            173,841
     Accounts receivable                                                 5,581,846                 2,531,424
     Prepaid expenses and other                                            141,313                   127,947
     Deferred financing costs                                                    -                    42,883
                                                              -----------------------  ---------------------
                                                                         6,210,729                 2,876,095
                                                              -----------------------  ---------------------

Property, plant and equipment                                              891,360                   765,112
                                                              -----------------------  ---------------------
                                                              $          7,102,089      $          3,641,207
                                                              =======================  =====================
LIABILITIES AND SHAREHOLDERS' DEFICIT

CURRENT LIABILITIES
     Demand loan (note 4)                                     $            148,227      $             11,462
     Accounts payable and accrued liabilities                            8,851,646                 4,512,586
     Current portion of deferred revenue                                   123,076                    83,352
     Other loans (note 6)                                                  361,722                   545,235
                                                              -----------------------  ---------------------
                                                                         9,484,671                 5,152,635
LONG-TERM LIABILITIES
     Deferred revenue                                                      180,989                   184,742
                                                              -----------------------  ---------------------
                                                                         9,665,660                 5,337,377
                                                              -----------------------  ---------------------

Minority interest                                                            2,360                     2,170
                                                              -----------------------  ---------------------

Contingent liabilities (note 12)

SHAREHOLDERS' DEFICIT
     Capital stock                                                      11,544,736                11,544,736
     Contributed surplus (note 8)                                        2,355,443                 1,236,587
     Convertible debentures (note 7)                                       335,143                   261,440
     Deficit                                                           (16,061,371)              (14,333,572)
     Cumulative translation adjustment                                    (739,882)                 (407,531)
                                                              -----------------------  ---------------------
                                                                        (2,565,931)               (1,698,340)
                                                              -----------------------  ---------------------
                                                              $          7,102,089      $          3,641,207
                                                              =======================  =====================
</TABLE>

The accompanying notes are an integral part of these consolidated financial
statements.

<PAGE>

                          MED-EMERG INTERNATIONAL INC.
                CONSOLIDATED STATEMENT OF OPERATIONS AND DEFICIT
          THREE AND SIX MONTHS ENDED JUNE 30, 2003 AND 2002 (UNAUDITED)
                                    (IN US$)

<TABLE>
<CAPTION>

                                                                         THREE MONTHS ENDED               SIX MONTHS ENDED
                                                                -------------------------------  ---------------------------------
                                                                    JUNE 30         JUNE 30        JUNE 30            JUNE 30
                                                                      2003            2002           2003               2002
                                                                -------------------------------  ---------------------------------
                                                                                 (see note 13)                      (see note 13)

<S>                                                             <C>              <C>            <C>                <C>
REVENUE                                                         $18,412,652      $  11,310,318  $  31,556,472       $  21,051,852

PHYSICIAN FEES AND OTHER DIRECT COSTS                            15,983,175          9,647,134     27,302,153          17,832,095
                                                                 ----------------------------------------------------------------
                                                                  2,429,477          1,663,184      4,254,319           3,219,757
                                                                 ----------------------------------------------------------------
EXPENSES

     Salaries and benefits                                       $1,077,042      $     838,390  $   2,027,213       $   1,606,728
     General and administration                                     853,774            239,476      1,190,679             432,060
     Occupancy costs and supplies                                   398,446            403,181        771,834             771,885
     Public company costs                                            44,157             24,849         66,049              37,321
     Travel & marketing                                             112,072             70,661        192,920             105,499
                                                                 ----------------------------------------------------------------
                                                                  2,485,491          1,576,557      4,248,695           2,953,493
                                                                 ----------------------------------------------------------------

INCOME (LOSS) BEFORE UNDERNOTED ITEMS                               (56,014)            86,627          5,624             266,264

     Interest and financing expense                                 194,471            463,285        349,707             563,771
     Amortization of property, plant and equipment                   68,952             65,625        128,286             120,081
     Stock compensation expenses (note 8)                           385,229                  -      1,118,856                   -
     Foregiveness of loan                                                 -           (227,893)             -            (227,893)
                                                                 ----------------------------------------------------------------
                                                                    648,652            301,017      1,596,849             455,959
                                                                 ----------------------------------------------------------------

OPERATING LOSS BEFORE INCOME TAXES                                 (704,666)          (214,390)    (1,591,225)           (189,695)

     Income taxes (recovery)                                         13,845            (11,392)        13,845             (11,392)
                                                                 ----------------------------------------------------------------

NET LOSS BEFORE MINORITY INTEREST & PREFERRED
   SHARE DIVIDENDS                                                 (718,511)          (202,998)    (1,605,070)           (178,303)

     Minority interest                                               (1,374)            (3,578)        (4,167)             (6,769)
                                                                 ----------------------------------------------------------------

NET INCOME (LOSS) BEFORE PREFERRED SHARE DIVIDENDS                 (719,885)          (206,576)    (1,609,237)           (185,072)

     Preferred share dividends                                      (33,749)           (33,745)       (67,499)            (67,489)
                                                                 ----------------------------------------------------------------

NET LOSS                                                           (753,634)          (240,321)    (1,676,736)           (252,561)

DEFICIT, BEGINNING OF THE PERIOD                                (15,281,263)       (13,543,789)   (14,333,572)        (13,510,845)

     Convertible debenture charges (note 7)                         (26,474)           (21,232)       (51,063)            (41,936)
                                                                 ----------------------------------------------------------------

DEFICIT, END OF THE PERIOD                                     $(16,061,371)      $(13,805,342)  $(16,061,371)       $(13,805,342)
                                                                 ================================================================

BASIC LOSS PER COMMON SHARE                                          $(0.08)      $      (0.03)  $      (0.18)       $      (0.03)
                                                                 ================================================================

WEIGHTED AVERAGE BASIC COMMON SHARES OUTSTANDING                  9,519,828          9,375,828      9,519,828           9,339,828
                                                                 ================================================================
</TABLE>

<PAGE>

                          MED-EMERG INTERNATIONAL INC.
                      CONSOLIDATED STATEMENT OF CASH FLOWS
          THREE AND SIX MONTHS ENDED JUNE 30, 2003 AND 2002 (UNAUDITED)
                                    (IN US$)
<TABLE>
<CAPTION>
                                                                         THREE MONTHS ENDED               SIX MONTHS ENDED
                                                                -------------------------------  ---------------------------------
                                                                    JUNE 30         JUNE 30        JUNE 30            JUNE 30
                                                                      2003            2002           2003               2002
                                                                -------------------------------  ---------------------------------
                                                                                 (see note 13)                      (see note 13)
<S>                                                               <C>             <C>            <C>                <C>
CASH FLOWS FROM OPERATING ACTIVITIES
   Net loss for the period                                          $ (753,634)    $ (240,321)    $(1,676,736)         $(252,561)
   Adjustments for:
     Amortization of property, plant and equipment                      68,952         65,625         128,286            120,081
     Minority interest                                                    (515)           805             190                975
     Foregiveness of loan                                                    -       (227,893)              -           (227,893)
     Stock compensation expenses (note 8)                              385,229              -       1,118,856                  -
     Convertible debentures (note 7)                                    11,738         13,235          22,641             26,140
     Common shares issued for financing                                      -        194,400               -            194,400
                                                                    -------------------------------------------------------------
                                                                      (288,230)      (194,149)       (406,763)          (138,858)

   Increase in non-cash working capital components                   1,403,086         280,344       1,311,244            533,062
                                                                    -------------------------------------------------------------
                                                                     1,114,856          86,195         904,481            394,204
                                                                    -------------------------------------------------------------

CASH FLOWS FROM INVESTING ACTIVITIES
   Additions to property, plant and equipment                         (127,950)       (191,597)       (254,536)          (396,025)
   Sale of investment in Next Generation Technology Holdings, Inc.           -               -               -            102,051
                                                                    -------------------------------------------------------------
                                                                      (127,950)       (191,597)       (254,536)          (293,974)
                                                                    -------------------------------------------------------------

CASH FLOWS FROM FINANCING ACTIVITIES
   Repayment of bank indebtedness                                            -        (852,036)              -           (965,972)
   Demand loan (note 4)                                               (306,009)        496,049         136,765            496,049
   Deferred financing costs incurred                                    16,788        (108,500)         42,883           (108,500)
   Issuance (repayment) of other loans                                 (74,533)        678,062        (183,513)           573,745
                                                                    -------------------------------------------------------------
                                                                      (363,754)        213,575          (3,865)            (4,678)
                                                                    -------------------------------------------------------------

Effect of foreign currency exchange rate changes                      (200,196)        (71,229)       (332,351)           (70,123)

INCREASE IN CASH                                                       422,956          36,944         313,729             25,429
Cash, beginning of period                                               64,614          58,826         173,841             70,341
                                                                    -------------------------------------------------------------
Cash, end of period                                                   $487,570     $    95,770    $    487,570         $   95,770
                                                                    -------------------------------------------------------------
</TABLE>

<PAGE>

MED-EMERG INTERNATIONAL INC.
Notes to Unaudited Consolidated Financial Statements
Six months ended June 30, 2003 and 2002

1. ORGANIZATION AND DESCRIPTION OF BUSINESS

Med-Emerg International Inc. ("MEII" or the "Company") is a private sector
provider of quality healthcare management services to the Canadian healthcare
industry.

The Company is publicly traded and listed on the OTC Bulletin Board. The Company
completed its initial public offering in February 1998.

The Company's operations are in Canada and are divided into five business units:
Hospital Staffing, Medical Clinics, Government Healthcare Services,
Pharmaceutical Support and Long-Term Care. The Company intends to broaden its
healthcare management services over a wider geographic base.

For hospital staffing, the Company provides emergency department physician and
nurse recruitment, staffing and administrative support services to hospitals, on
a contractual basis. At June 30, 2003, the Company had 22 contracts for
physician staffing and one contract for nurse staffing.

The Company owns and manages 20 medical clinic facilities. This unit provides
physicians with the ability to practice within a professionally managed network
and to concentrate on the clinical aspects of their practices.

The Company provides medical personnel to the entire Canadian Forces ("CF"). The
Company provides in-garrison healthcare at bases across Canada. Through this
contract the Company recruits, schedules and manages physicians, nurses,
dentists, physiotherapists and other healthcare professionals to provide
services as required by the CF health authority resident at each base.

The Company provides special access Remicade(TM) infusion services to patients
suffering from Crohn's Disease and Rheumatoid Arthritis at clinic locations
across Canada.

MEII provides physician and nurse practitioners to select long-term care
facilities in Ontario. Such physician services include admission physical
assessments and regular primary care to residents of the facilities.

2. BASIS OF PRESENTATION

The accompanying unaudited consolidated financial statements have been prepared
in accordance with Canadian generally accepted accounting principles. These
financial statements consolidate, with minority interest, the accounts of MEII
and all wholly- and partially-owned subsidiaries of MEII. The consolidated
financial statements are expressed in US dollars and are prepared in accordance
with Canadian generally accepted accounting principles. Differences between
Canadian and United States accounting principles are described in note 9.

In the opinion of management, the unaudited interim consolidated financial
statements follow the same accounting policies and methods of application as the
most recent audited annual financial statements.

Operating results for the interim periods are not necessarily indicative of the
results that may be expected for the year ended December 31, 2003.

These consolidated financial statements, footnote disclosures and other
information should be read in conjunction with the consolidated financial
statements and the notes thereto included in the Company's Annual Report on Form
10-K for the year ended December 31, 2002.

Significant intercompany accounts and transactions have been eliminated on
consolidation.

<PAGE>

MED-EMERG INTERNATIONAL INC.
Notes to Unaudited Consolidated Financial Statements
Six months ended June 30, 2003 and 2002

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

a) Going concern

The consolidated financial statements have been prepared on principles
applicable to a going concern which assumes that the Company will be able to
realize its assets and discharge its obligations in the normal course of
business. As at June 30, 2003, the Company had a working capital deficiency of
$3,273,942 and a shareholders' deficit of $ 2,565,931.

On June 28th, 2002 the Company discharged its primary banker HSBC Bank Canada
("HSBC") and MEII currently does not have any traditional bank credit
facilities.

Management continues to pursue opportunities to return to profitability. These
plans include:

1) pursuing suitable financing opportunities;
2) cost-cutting measures where available including closure of certain clinics;
   and
3) negotiating discounts with creditors.

The Company's ability to continue as a going concern is dependent on the
successful implementation of its strategic plan to return to profitability.

Should the Company be unable to obtain such alternative financing, it may not be
able to continue as a going concern. As a result, certain assets and liabilities
currently reflected in the balance sheet at book value would have to be adjusted
to liquidated values.

b) Use of estimates

The preparation of consolidated financial statements in conformity with Canadian
generally accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent liabilities during the reporting period. Significant
areas requiring the use of estimates relate to: 1) the reported amounts of
revenues and expenses, 2) the disclosure of contingent liabilities, 3) the
carrying value of property, plant, and equipment and the rate of amortization
related thereto. Actual results could differ from those estimates.

c) Short term investments

Short term investments comprising marketable securities were written down to its
market value.

d) Property, plant and equipment

Property, plant and equipment are recorded at cost and are amortized over their
estimated useful lives at the undernoted rates and methods:

     Furniture and fixtures             20%               Declining balance
     Medical equipment                  10%               Declining balance
     Computer software                 100%               Declining balance
     Computer hardware                  30%               Declining balance
     Leasehold improvements      5-10 years               Straight-line

<PAGE>

MED-EMERG INTERNATIONAL INC.
Notes to Unaudited Consolidated Financial Statements
Six months ended June 30, 2003 and 2002

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT'D)

e) Impairment charges

At least annually and when events and circumstances warrant a review, the
Company evaluates the carrying value of its assets for potential impairment. An
impairment loss is recognized when the estimated net realizable value of any
asset is less than its carrying value. Any impairment in assets is written down
and charged to earnings in the year.

f) Revenue recognition

The company has adopted the provisions of Emerging Issues Committee ("EIC") -
123, issued by the Canadian Institute of Chartered Accountants (CICA) which
became effective on January 1, 2002. EIC -123 addresses the reporting of revenue
on a gross basis as a principal versus on a net basis as an agent.

The following is a description of MEII's revenue recognition policies for each
of the significant business units.

(1) Clinic Staffing:

Revenue is reported on a mix of both gross and net basis for clinic staffing.

MEII acts as principal in providing health service delivery through the clinic
network. MEII is the operator of the clinic that provides the health service,
has the responsibility to provide the facility, staffing and follow-up effort
(both by way of clinic managers and by providing the billing function) and also
controls the patient records, patient billings and patient collections. There
are a number of risks MEII attempts to manage which includes insurance coverage
both in respect of the property and also coverage on healthcare professionals
who work for the Company. For certain clinics, MEII has the risk of collection
in that claims may be submitted for ineligible patients or the Minister of
Health and Long Term Care may reject certain claims processed. Revenue from
these clinics is recognized on a gross basis. However, in certain other clinics
the billings are submitted and collected by the physicians directly and only the
Company's portion is remitted to MEII. In such cases the revenue is recorded on
a net basis.

(2) Hospital Staffing, Pharmaceutical support and Long-term care:

Revenue is reported on a gross basis.

MEII acts as a principal in providing these services. MEII contracts with
emergency room physician and nursing personnel to provide services to hospitals
in Ontario, a mix of rural and urban facilities including tertiary care centres.

Under contract with Schering-Plough Canada, MEII acts as the national
co-ordinator for the community-based infusion of Remicade(TM) for the treatment
of patients with rheumatoid arthritis and Chron's disease.

In 2002, MEII commenced a new line of business, which involves contracting with
physicians and nurse practitioners to provide services to long-term care
facilities in Ontario.

MEII has the risk of non-collection from these revenue streams.

<PAGE>

MED-EMERG INTERNATIONAL INC.
Notes to Unaudited Consolidated Financial Statements
Six months ended June 30, 2003 and 2002

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT'D)

(3) Healthcare Services (Includes Department of National Defence ("DND")):

Revenue is reported on a gross basis.

MEII has an administrative management contract with Public Works and Government
Services Canada ("PWGSC") to provide personnel to Canadian armed forces across
Canada on behalf of the Minister of National Defence.

Under the terms of the contract, MEII has the responsibility to hire medical
personnel and support staff and where necessary provide appropriate training and
supervision of the work performed at the respective bases across Canada. MEII
bills DND for the work performed by these individuals and in turns pays the
medical personnel and support staff based on the terms of the respective
contracts signed with them. MEII has a risk of non-collection from DND.

g) Future income taxes

The Company accounts for income taxes using the asset and liability method.
Future tax assets and liabilities are recognized for the future taxes
attributable to the temporary differences between the financial statement
carrying amounts of existing assets and liabilities and their respective tax
carrying values. Future tax assets and liabilities are measured using enacted or
substantially enacted tax rates expected to apply to taxable income in the years
in which those temporary differences are expected to be recovered or settled. A
valuation allowance against future tax assets is provided to the extent that the
realizations of these future tax assets is not more likely than not.

h) Cash

Cash consists of cash on hand and in banks.

i) Foreign currency translation

The Company has adopted the recommendation of the Canadian Institute of
Chartered Accountants ("CICA") handbook section 1650 Foreign Currency
Translation. The amended standard eliminates the deferral and amortization
approach to exchange gains and losses on long-term monetary items and requires
the disclosure of the exchange gains and losses included in the calculation of
net income. There is no material effect of this change in accounting policy on
the financial statements of the Company.

The Company maintains its books and records in Canadian dollars. The financial
statements are converted to U.S. dollars as the Company is a reporting issuer in
the United States of America. The translation method used is the current rate
method. Under the current rate method all assets and liabilities are translated
at the current rate prevailing at the balance sheet date, shareholders' deficit
is translated at historical rates and all income and expense items are
translated at average rates for the year. Due to the fact that items in the
financial statements are being translated at different rates according to their
nature, a translation adjustment is created. This translation adjustment has
been included in cumulative translation adjustment.

<PAGE>

MED-EMERG INTERNATIONAL INC.
Notes to Unaudited Consolidated Financial Statements
Six months ended June 30, 2003 and 2002

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT'D)

j) Stock compensation

The Company has adopted section 3870 issued by the CICA in respect of stock
based compensation and other stock based payments. This section requires that a
fair value based method of accounting be applied to all stock based payments to
non-employees and to direct awards of stock to employees. The standard requires
either the recognition of a compensation expense for grants of stock, stock
options, and other equity instruments to employees based on the estimated fair
value of the instruments at the grant date, or alternatively, the disclosure of
pro forma net earnings and earnings per share data as if stock based
compensation had been recognized in earnings.

4. DEMAND LOAN

The demand loan amount is owing to Morrison Financial Services Limited ("MFSL")
under the terms described in note 5.

5. REFINANCING ACTIVITIES

a) On May 24, 2002 the Company issued a $720,000 discounted secured debenture,
with net proceeds of $600,000 and repaid bank loans from the net proceeds.

The terms of the secured debenture include:
   1. maturity date of June 1, 2003
   2. an effective interest rate of 23.4% per annum
   3. convertible into common shares at $1 per share at the option of the holder
   4. 216,000 restricted common shares issued to the debenture holders
   5. redeemable on or before 180th day from the date of the closing at 115% of
      the principal amount, and any date thereafter at 120%
      of the principal amount.

A principal shareholder of the Company guaranteed the debenture, providing as
security, unrestricted free trading common shares of the Company equivalent to
150% of the face value of the debenture. In exchange for the guarantee, the
Company issued to the guarantor shareholder common share purchase options to
purchase 100,000 common shares at $1.00 per share. In the event that the market
value of the common shares provided as security falls below 200 % of the face
amount of the debenture, the Company is required to pledge additional securities
to return the market value to 200% of the face amount (see note 6 for more
details).

The secured debenture was repaid, in full, on July 2, 2003.

b) On June 28, 2002, MFSL paid HSBC $475,406 on MEII's behalf which was the
balance owing under the forbearance agreement. The completion of the
aforementioned financial transaction had the effect of reducing the Company's
total debt by $228,459 since the obligation to the HSBC was eliminated at a
discounted value. MFSL provided the Company with a full-recourse invoice
discounted facility in an amount not to exceed $475,406 based on purchasing and
advancing up to 75% of the face amount of a qualifying invoice with the balance
held on reserve until the invoice is collected in full. The facility had a term
of one year, with an annualized interest rate of 34.22% that matures on June 28,
2003. The Company recently renegotiated this loan agreement with MFSL. The
following clauses of the agreement were amended as follows:

<PAGE>

MED-EMERG INTERNATIONAL INC.
Notes to Unaudited Consolidated Financial Statements
Six months ended June 30, 2003 and 2002

5. REFINANCING ACTIVITIES CONT'D

     1.   Facility: The maximum amount of the facility increased from $556,586
          ($750,000 CDN) in aggregate advances outstanding from time to time, to
          a maximum of $742,115 ($1,000,000 CDN). The advance rate increased
          from 75% of the face amount of qualifying invoices to 80%.
     2.   Term: The term of the facility is for a one year period that commenced
          on July 1, 2003.
     3.   Discount fees: The discount fees charged are reduced from 34.22% to
          23% on an annualized basis.

If MEII terminates this financing facility within the 12-month period beginning
July 1, 2003, the Company shall be subject to an exit fee equivalent to the
amount of discount fees paid under this facility in the prior three full months.

In addition to the specific Standard Form Assignments (General), all amounts due
to MFSL are secured by a general security agreement on all assets and
undertakings of MEII, an assignment of all risk insurance policies and an
assignment of key man life insurance of a director.

6. OTHER LOANS
<TABLE>
<CAPTION>
                                                                                               JUNE 30           DECEMBER 31
                                                                                                 2003                2002
<S>                                                                                          <C>                   <C>
Bank loan, interest at 10.9%, repayable in equal monthly installments of
$1,475 principal plus interest, secured by personal guarantee of a
shareholder, due August 2003                                                                     1,722                10,082

Secured debenture, effective interest at 23.4%                                                 360,000               535,000

Obligations under capital lease                                                                      -                   153
                                                                                             -------------------------------
                                                                                               361,722               545,235
                                                                                             ===============================
</TABLE>

The secured debenture was repaid, in full, on July 2, 2003.

7. CONVERTIBLE DEBENTURES

The convertible debentures were issued on September 30, 2001, are due on
September 30, 2006 and bear interest at 7%. MEII may pay the principal amount
and accrued interest at any time prior to maturity by way of cash or shares of
MEII common stock or a combination of cash and MEII common stock at the
discretion of the Company. The amount of the repayment of the convertible
debenture being tendered as MEII common stock shall be valued by dividing the
repayment amount by the average closing price for MEII common stock for 10
trading days prior to the date of notice of payment or, if MEII common stock is
not then publicly traded, by the net asset value per share of the MEII common
stock. Accordingly, these debentures have been reflected in the financial
statements at its estimated present value and included in shareholder's deficit.
The 2002 comparative figures have been restated (see note 13).

<PAGE>

MED-EMERG INTERNATIONAL INC.
Notes to Unaudited Consolidated Financial Statements
Six months ended June 30, 2003 and 2002

7. CONVERTIBLE DEBENTURES CONT'D
<TABLE>
<CAPTION>

Convertible debentures                                     Undiscounted Total             Present Value
                                                     ---------------------------    ----------------------
<S>                                                            <C>                          <C>
Principal due on September 30, 2006                             $590,536                     $92,130
Interest due on September 30, 2006                               206,688                      32,245
                                                                --------                    --------
                                                                $797,224                    $124,375
                                                                ========                    ========
</TABLE>
<TABLE>
<CAPTION>

                                                                JUNE 30                    DECEMBER 31
                                                                  2003                         2002
<S>                                                           <C>                         <C>
Convertible debentures at December 31, 2002                     $261,440                    $261,440
Interest costs in 2003                                            22,640                           -
Convertible debenture charges in 2003                             51,063                           -
                                                                --------                    --------
Convertible debentures at December 31, 2003                     $335,143                    $261,440
                                                                ========                    ========
</TABLE>

The above debentures will be accreted up to their principal values at the rate
of 45% per annum on the net present values shown. During fiscal 2002 the amount
of $84,080 was accreted to principal with corresponding charge to deficit and
for the period ending June 30, 2002 $51,063 was accreted to the balance.

8. CONTRIBUTED SURPLUS

During the first quarter of 2003 the terms of the warrants were amended
entitling each warrant holder to purchase one share of common stock at a price
of $0.50 (previously $4.50). The expiry of these warrants has been extended from
February 11, 2003 to February 11, 2005.

On May 15, 2003, 785,000 options were granted with an exercise price of $0.50
per option. The options vest immediately and are available for a term of five
years expiring on May 15, 2008. The Company also cancelled 730,000 options
during the second quarter of 2002; 230,000 options at $1.25 per option and
400,000 options at $1.50 per option; 100,000 options at $0.50 per option.

Due to the amendment to these mentioned warrants and the issuance of new options
the fair value amounting to $733,627 and $385,229 respectively have been
determined using an option pricing model (Black Scholes) as per section 3870 of
the CICA handbook. These amounts have been credited to contributed surplus.

9. CANADIAN AND UNITED STATES ACCOUNTING POLICY DIFFERENCES

These consolidated financial statements have been prepared in accordance with
Canadian generally accepted accounting principles ("Canadian GAAP"), which
conform in all material respects with those in the United States ("U.S. GAAP")
during the periods presented, except with respect to the following:

<PAGE>

MED-EMERG INTERNATIONAL INC.
Notes to Unaudited Consolidated Financial Statements
Six months ended June 30, 2003 and 2002

9. CANADIAN AND UNITED STATES ACCOUNTING POLICY DIFFERENCES (CONT'D)

(a) Deficit

Under Canadian GAAP, the convertible debentures have been presented in
Shareholders' deficit as the Company has the option to satisfy the debt by way
of cash or shares or a combination of cash and shares. The debentures have been
discounted to reflect the net present value as at the balance sheet date. Under
U.S. GAAP, these obligations should be shown as long-term debt on the balance
sheet.

If U.S. GAAP were employed, deficit for the period would be adjusted as follows:

<TABLE>
<CAPTION>
                                                  JUNE 30               DECEMBER 31
                                                    2003                    2002
<S>                                           <C>                   <C>
Deficit based on Canadian GAAP                $ (16,061,371)        $ (14,333,572)
Convertible debentures (note 7)                    (344,386)             (395,449)
                                              -------------         -------------
Deficit based on US GAAP                        (16,405,757)          (14,729,021)
                                              =============         =============
</TABLE>

(b) Shareholders' deficit

Under Canadian GAAP, the purchase price of an acquisition is determined based on
the share price on the date the transaction is consummated. Under U.S. GAAP, the
purchase price of an acquisition where shares are issued is determined based on
the share price for the period surrounding the announcement date of the
acquisition. The share price used for the YFMC Healthcare Inc. acquisition under
Canadian GAAP was $1.25. The share price used for the YFMC Healthcare Inc.
acquisition under U.S. GAAP was $1.859.

Under U.S. GAAP, detachable stock purchase warrants are given separate
recognition from the primary security issued. Upon initial recognition, the
carrying amount of the two securities is allocated based on the relative fair
values at the date of issuance. Under Canadian GAAP, the detachable stock
purchase warrants issued in conjunction with the private stock offering on
January 22, 1996 and subsequently surrendered, have been given no recognition in
the financial statements. Under U.S. GAAP, based on an ascribed fair value of $
0.364 for each of the 1,000,000 share warrants issued, share capital would be
lower by $ 36,406 and, given that the stock purchase warrants were cancelled,
the carrying amount of contributed surplus would be increased by $ 36,406.

Under U.S. GAAP the effect on shareholders' deficit would be adjusted as
follows:

<PAGE>

MED-EMERG INTERNATIONAL INC.
Notes to Unaudited Consolidated Financial Statements
Six months ended June 30, 2003 and 2002

9. CANADIAN AND UNITED STATES ACCOUNTING POLICY DIFFERENCES (CONT'D)

<TABLE>
<CAPTION>
                                                                        JUNE 30               DECEMBER 31
                                                                          2003                    2002
     <S>                                                              <C>                    <C>
     Capital stock                                                      11,544,736             11,544,736
     Capital stock issued on purchase of YFMC Healthcare Inc.            1,087,872              1,087,872
     Ascribed fair value of share purchase warrants issued                 (36,406)               (36,406)
                                                                        ----------             ----------
     Capital stock - U.S. GAAP                                          12,596,202             12,596,202
                                                                        ==========             ==========
     Contributed surplus                                                 2,355,443              1,236,587
     Share purchase warrants                                                36,406                 36,406
                                                                        ----------             ----------
     Paid-in-capital - U.S. GAAP                                         2,391,849              1,272,993
                                                                        ----------             ----------

     Deficit - U.S. GAAP                                               (16,405,757)           (14,729,021)
     Cumulative translation adjustment                                    (739,882)              (407,531)
                                                                        ----------             ----------

     Shareholders' deficit - U.S. GAAP                                  (2,157,588)            (1,267,357)
                                                                        ==========             ==========
</TABLE>

(c) Comprehensive loss

Statement of Financial Accounting Standards No. 130, "Reporting Comprehensive
Income" (SFAS 130), establishes standards for reporting and display of
comprehensive loss and its components in the financial statements. Under U.S.
GAAP, the comprehensive loss for the fiscal year ended December 31, 2002 would
be adjusted as follows:

                                                  JUNE 30           JUNE 30
                                                    2003              2002

Net loss (U.S./Canadian GAAP)                   (1,676,736)        (252,561)
Foreign currency translation adjustment           (332,351)         (70,123)
                                                -----------        ---------
Comprehensive loss                              (2,009,087)        (322,684)
                                                -----------        ---------

(d) Recently issued Accounting Standards

The following standards were issued by the Financial Accounting Standards Board
during 2003 and 2002:


          SFAS No. 143 - Accounting for asset retirement obligations - this
          standard requires that entities record the fair value of a liability
          for an asset retirement obligation in the period in which it is
          incurred. This standard is effective for fiscal years beginning after
          June 15, 2002.

<PAGE>

MED-EMERG INTERNATIONAL INC.
Notes to Unaudited Consolidated Financial Statements
Six months ended June 30, 2003 and 2002

9. CANADIAN AND UNITED STATES ACCOUNTING POLICY DIFFERENCES (CONT'D)

          SFAS No. 144 - Accounting for the impairment or disposal of long-lived
          assets. This standard supercedes SFAS No. 121 - Accounting for the
          impairment of long-lived assets and for long-lived assets to be
          disposed of. This standard requires that businesses recognize
          impairment when the financial statement carrying amount of long-lived
          asset or asset group exceeds its fair value and is not recoverable.

          SFAS No. 145 - Rescission of FASB Statements No. 4, 44 and 64,
          Amendment of FASB No. 13, and Technical Corrections. SFAS 145 updates,
          clarifies and simplifies existing accounting pronouncements. SFAS 145
          rescinds Statement No. 4, which required all gains and losses from
          extinguishments of debt to be aggregated and, if material, classified
          as an extraordinary items, net of related income tax effect. As a
          result, the criteria in APB Opinion No. 30 will now be used to
          classify those gains and losses because Statement No. 4 has been
          rescinded. Statement No. 44 was issued to establish accounting
          requirements for the effects of transition to provisions of the Motor
          Carrier Act of 1980. Because the transition has been completed,
          Statement No. 44 is no longer necessary.

          SFAS No. 146 - Accounting for Cost Associated with the Exit of
          Disposal Activities. SFAS 146 requires companies to recognize costs
          associated with exit or disposal activities when they are incurred
          rather than at the date of commitment to an exit or disposal plan.
          Previous accounting guidance was provided by Emerging Issues Task
          Force ("EITF") Issue No. 94-3. SFAS 146 replaces EITF94-3. The
          Statement is to be applied prospectively to exit or disposal
          activities initiated after December 31, 2002.

          SFAS No. 147 - Acquisition of certain financial institutions an
          amendment of SFAS 72 and 144 and SFAS interpretation number 9 issued
          October 2002 and relates to acquisitions of financial institutions.

          SFAS No. 148 - Accounting for stock based compensation-transition and
          disclosure an amendment of SFAS 123 issued December 2002 and permits
          two additional transition methods for entities that adopt the fair
          value based method of accounting for stock based employee compensation
          to avoid the ramp-up effect arising from prospective application. This
          statement also improves the prominence and clarity of the pro-forma
          disclosures required by SFAS 123.

          SFAS No. 149 - Amendment of statement 133 on derivative instruments
          and hedging activities. This statement amends and clarifies financial
          accounting and reporting for derivative instruments embedded in other
          contracts (collectively referred to as derivatives) and for hedging
          activities under FASB 133 accounting for derivative instruments and
          hedging activities.

          SFAS No. 150- Accounting for certain financial instruments with
          characteristics of both liabilities and equity. This statement
          establishes standards for how an issuer classifies and measures
          certain financial instruments with characteristics of both liabilities
          and equity.

The Company believes that the above standards would not have a material impact
on its financial position, results of operations or cash flows as it relates to
the reconciliation of Canadian and United States accounting policy differences.

<PAGE>

MED-EMERG INTERNATIONAL INC.
Notes to Unaudited Consolidated Financial Statements
Six months ended June 30, 2003 and 2002

10. ECONOMIC DEPENDENCE

Approximately 64% of revenue and 27% of gross margin is derived from one
customer (69% of revenue and 27% of gross margin in 2002). Receivables for this
customer amounted to 36% of total receivables (52% of total receivables in
2002). The loss of a material amount of revenue to this customer could have a
material adverse effect on operations of the Company.

11. SEGMENTED INFORMATION

The Company operates under five business units: Hospital Staffing, Medical
Clinics, Government Healthcare Services, Pharmaceutical Support and Long-Term
Care.

The Hospital Staffing unit contracts with hospitals for the provision of
physician staffing, nurse staffing and administrative support services. The
Company also contracts with clinical facilities and local communities for the
locum or permanent placement of a physician in a community.

The Medical Clinics unit owns and manages medical clinic facilities. The clinics
include family practice, walk-in services, and other related services such as
massage therapy and chiropractic services.

The Government Healthcare Services division recruits, schedules and manages
physicians, nurses, dentists, physiotherapists and other regulated healthcare
professionals at Canadian Forces bases, across Canada.

In the table below, the Hospital Staffing unit includes the revenue and cost for
the Long-term Care business unit and the Medical Clinics unit includes the
revenue and cost for the Pharmaceutical Support unit.

The segmented information for the business units are as follows:

<PAGE>
<TABLE>
<CAPTION>
                                                                                 JUNE 30, 2003
                                                    ------------------------------------------------------------------------
                                                                                           GOVERNMENT
                                                          HOSPITAL           MEDICAL       HEALTHCARE
                                                          STAFFING           CLINICS        SERVICES         CONSOLIDATED

                                                                              THREE MONTHS ENDED JUNE 30, 2003
                                                    ------------------------------------------------------------------------
<S>                                                       <C>                <C>            <C>                <C>
Revenue                                                   5,376,219          2,286,762      10,749,671         18,412,652
Gross margin                                                783,492          1,032,710         613,275          2,429,477

Operating income (loss)                                     442,670           (202,210)       (296,474)           (56,014)

Net income (loss)                                           274,236           (433,330)       (594,540)          (753,634)

                                                                               SIX MONTHS ENDED JUNE 30, 2003
                                                    ------------------------------------------------------------------------
Revenue                                                   6,934,595          4,343,944      20,277,933         31,556,472
Gross margin                                              1,121,914          1,968,724       1,163,681          4,254,319

Operating income (loss)                                     539,072           (363,715)       (169,733)             5,624

Net income (loss)                                            97,826           (935,656)       (838,906)        (1,676,736)

Assets employed at end of period                          3,088,082          1,875,941       2,138,066          7,102,089
Depreciation                                                  8,081             87,767          32,438            128,286
</TABLE>

<TABLE>
<CAPTION>
                                                                                         JUNE 30, 2002
                                                     ------------------------------------------------------------------------
                                                                                           GOVERNMENT
                                                          HOSPITAL           MEDICAL       HEALTHCARE
                                                          STAFFING           CLINICS        SERVICES         CONSOLIDATED

                                                                               THREE MONTHS ENDED JUNE 30, 2002
                                                     ------------------------------------------------------------------------
<S>                                                       <C>                <C>             <C>               <C>
Revenue                                                   1,308,967          2,035,105       7,966,246         11,310,318
Gross margin                                                222,344            977,172         463,668          1,663,184

Operating income (loss)                                      13,069            (80,894)        154,452             86,627

Net income (loss)                                           (44,612)          (186,727)         (8,982)          (240,321)

                                                                                  SIX MONTHS ENDED JUNE 30, 2002
                                                     ------------------------------------------------------------------------
Revenue                                                   2,554,779          4,006,552      14,490,521         21,051,852
Gross margin                                                430,148          1,921,914         867,695          3,219,757

Operating income (loss)                                      52,242            (96,182)        310,204            266,264

Net income (loss)                                           (30,448)          (261,352)         39,239           (252,561)

Assets employed at end of period                            789,842          1,929,158       1,744,228          4,463,228
Depreciation                                                 24,885             79,293          15,903            120,081
</TABLE>

<PAGE>

MED-EMERG INTERNATIONAL INC.
Notes to Unaudited Consolidated Financial Statements
Six months ended June 30, 2003 and 2002

12. CONTINGENT LIABILITIES

     (i)  YMFC HealthCare Inc., a wholly owned subsidiary of the Company, is in
          receipt of a letter from Canada Customs and Revenue Agency ("CCRA")
          dated April 30, 2001, adjusting YFMC's Goods and Services Tax returns
          for the period from December 31, 1992, to December 31, 1996. The total
          amount claimed by CCRA for this period is $249,000. In the event that
          YFMC is ultimately found liable, the Company intends to claim an
          indemnity for such amount against the directors and certain named
          principals of YFMC pursuant to the Company's rights under the purchase
          agreement for YFMC executed on August 10, 1999. The Company's legal
          counsel has advised that CCRA does not intend to pursue YFMC for these
          amounts.

     (ii) The Company is in receipt of one claim from a former employee,
          claiming damages for breach of contract and/or severance pay. The
          Company is conducting an internal investigation of this complaint and
          is prepared to defend itself. In the event that the Company must pay
          the claim, the maximum amount payable would be $67,000.

     (iii) There is uncertainty with respect to the Company's liability for
          Goods and Services tax pertaining to certain services which it
          provides. The measurement of this uncertainty is not determinable and
          accordingly no provision has been made in respect thereof in these
          financial statements.

     (iv) There is uncertainty with respect to the Company's liability for
          Workers Safety and Insurance Board premiums pertaining to its contract
          with PWGSC. The measurement of this uncertainty is not determinable
          and accordingly no provision has been made in respect thereof in these
          financial statements.

Any liability resulting from the above will be reflected as a charge to income
in the year incurred.

13. COMPARATIVE FIGURES

Certain figures in the 2002 financial statements have been reclassified and
restated to conform with the basis of presentation in 2003. The statement of
operations for the six months ended June 30, 2002 has been restated to reflect a
net present value discount applied to the convertible debentures payable in
connection with the conditional stock exchange option for certain former
HealthyConnect.com Inc. (HCCI) shareholders. The future payments of the
convertible debentures which can be settled at the Company's option in cash or
common stock has been reclassified from liabilities to shareholder's deficit.
The effect of this restatement is as follows:

<TABLE>
<CAPTION>
                                         AS RESTATED FOR THE     AS PREVIOUSLY REPORTED
                                          SIX MONTHS ENDED      FOR THE SIX MONTHS ENDED
                                            JUNE 30, 2002            JUNE 30, 2002

<S>                                           <C>                      <C>
Operating loss before income taxes            (189,695)                (163,557)

Net loss before minority interest,
and preferred share dividends                 (178,303)                (152,165)

Net loss before preferred
share dividends                               (185,072)                (158,934)

Net loss                                      (252,561)                (226,423)
</TABLE>

<PAGE>

ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS

Forward-looking statements of Med-Emerg International Inc. ("MEII" or the
"Company) included herein or incorporated by reference including, but not
limited to, those regarding future business prospects, the acquisition of
additional clinics, the adequacy of capital resources and other statements
regarding trends relating to various revenue and expense items, could be
affected by a number of uncertainties and other factors beyond management's
control

OVERVIEW

MEII, based in Ontario, Canada, is a provider of a broad range of quality
healthcare management services. Established in 1983, the Company specializes in
the coordination and contract staffing of emergency physicians and nurses for
hospitals and clinics in Canada. Though emergency-related services are still an
important component of the Company's business, MEII has expanded to offer a wide
variety of medical services including staffing, medical clinics, the recruitment
of various healthcare professionals to fulfill a contract with the Department of
National Defence ("DND"), and a contract with Schering Plough Canada Inc. a
leading pharmaceutical company, to provide infusion services to patients.

The Company is positioned to build on its industry leadership by providing
integrated professional management services in the delivery of healthcare to the
healthcare consumer. The Company's operations are divided into five units:
Hospital Staffing, Medical Clinics, Government Healthcare Services,
Pharmaceutical Support, and Long-Term Care.

HOSPITAL STAFFING
-----------------
The Company provides emergency room physician staffing services to hospitals in
Ontario, a mix of rural and urban facilities including tertiary care centers.
The Company pays its physicians on an hourly or sessional basis, and receives a
fixed monthly administrative management fee from each hospital. The Company also
provides nursing coverage to hospital emergency departments on a shift-by-shift
basis. The Company charges a fixed hourly rate for every hour of nursing
coverage provided. At June 30, 2003, the Company had 22 contracts for physician
staffing and 1 contract for nurse staffing compared to 22 contracts for
physician staffing and 10 contracts for nurse staffing at June 30, 2002. During
the second quarter of 2003, the Hospital Staffing unit provided approximately
18,000 hours of physician coverage and 32,000 hours of nursing coverage per
month for its' clients, compared to 3800 hours of physician coverage and 1500
hours of nursing coverage during the second quarter of 2002. The 374% and 2033%
increase in the number of physician and nurse hours, respectively, is the result
of MEII supporting the healthcare system during the recent Severe Acute
Respiratory Syndrome ("SARS") outbreak. The people of Ontario, and more
specifically, Toronto, Canada were confronted with the SARS epidemic in March
2003. With a mortality rate of 15%, the Ministry of Health for Ontario
recognized the magnitude of the challenge and contacted Med-Emerg. In a few
short days, MEII mobilized its network of healthcare providers and recruited 246
doctors, nurses and respiratory technologists from across Canada, the United
States and the United Kingdom to combat the SARS outbreak. The SARS experience
is an excellent example of the Company's network in action. The ability to draw
on multi-disciplinary experts to address specific issues is the core of the MEII
service offering.

MEDICAL CLINICS
---------------
The Company began expanding its healthcare services in the early 1990's, in
response to the changing needs of patient care. The Company opened three
immediate care clinics in London and Mississauga, well before the concept became
popular in Ontario. Today, the Company is one of the largest physician practice
management companies, owning and operating 20 family practice clinics throughout
Canada; located in Ottawa (10), Toronto (2), London (3), Winnipeg (1), Edmonton
(2) and Calgary (2). With a repository of more than 2,000,000 patient charts and
providing care to more than 500,000 patients per year, the Company also
provides administrative support services to physician practices including
management administration, billing and staffing.

<PAGE>

GOVERNMENT HEALTHCARE SERVICES
------------------------------
In March of 2001, the Company was awarded the administrative management services
contract, the largest of its kind, to provide medical personnel to the CF bases
across Canada. The contract has two stages, an initial period of three years
with another three year renewal option extending to March 31, 2007. As the
service administrator, the Company recruits, schedules and pays physicians,
nurses, dentists, physiotherapists and other regulated healthcare professionals
as required by the local health authority resident on each base. The Company is
paid a monthly administrative management fee by the DND that is linked to the
number of providers being managed. The contract was subsequently broadened, and
as at June 30, 2003, the Company managed more than 800 employees and independent
healthcare professionals in 39 bases across Canada.

Annual revenue for services provided under this contract is expected to exceed
$40 million for fiscal 2003, of which approximately $37.7 million will be paid
to the healthcare providers supporting this contract.

The primary benefit to DND from this contract will be the existence of a "one
stop shopping" arrangement for the military base. As part of a national
organization, the Company's recruiters source health service providers from all
regions of Canada. By developing a long-term relationship with their employees
and sub-contractors, and being able to react quickly to changing local
conditions, the Company provides some stability in the workforce and enhances
continuity in the delivery of patient care for the DND.

In December of 2002, the Company was retained to provide healthcare services for
the Canadian Contract Augmentation Program ("CANCAP") recently awarded by the
Department of National Defence to SNC-Lavalin PAE Inc. Under this five year
contract, MEII will provide all contract healthcare services to the Canadian
soldiers, sailors and air force personnel deployed outside of Canada. On any
given day, thousands of CF members are preparing for, engaged in or have
returned from overseas missions. Since 1947, the CF has completed 73
international operations. With the addition of the CANCAP contract, MEII will
now be the provider of healthcare to Canada's military both home and abroad.

The Company will apply knowledge gained about the unique healthcare requirements
of the CF through its in-garrison contract, to the CANCAP contract. On March 15,
2003, MEII began providing the first phase of care for the men and women in
uniform whether they are deployed overseas or at home in Canada

PHARMACEUTICAL SUPPORT
----------------------
On March 2001, the Company signed a contract to become the coordinator for the
community-based infusion of Remicade(TM). This multi-year contract with
Schering-Plough Canada capitalizes on the Company's national network of health
placement coordinators to provide timely access to clinics for the treatment of
patients with disabling Rheumatoid Arthritis and Crohn's Disease. The Company
has established 14 infusion sites, and is projected to open approximately 3 more
by the end of December, 2003. It is estimated that approximately 40,000 patients
in Canada suffer from the debilitating effects of these two diseases. Under this
agreement, the Company coordinates and manages infusion services for patients
referred to it by physicians at its clinic locations. By June 30, 2003, there
were approximately 1,200 patients registered with the Company for this program,
receiving regular infusions. It is anticipated that the number of patients
participating in this program will reach 1,400 by the end of 2003.Through its
Pharma Support program, MEII provides a turn-key solution that manages all
aspects of the referring specialist process, including scheduling, benefit
coordination, infusions and reporting.

<PAGE>

With the knowledge and skills that it has developed providing infusion services,
the Company is now pursuing business development opportunities to provide
additional services to pharmaceutical manufacturers including other infusion
products, coordination of clinical trials and provision of compliance programs.

LONG-TERM CARE
--------------
The problem of physician shortages is evident not only in hospitals in Ontario
but also in long-term care facilities. The Company has received requests from
long-term care facilities for physicians to provide admission physical
assessments and regular primary care to residents. Residents of these facilities
are typically not cared for by their family physicians once they are transferred
to long-term care facilities, thus they lack routine primary healthcare. During
April 2002, the Company commenced providing admission physical assessments and
regular primary care to residents at long-term care facilities. As at June 30,
2003 the Company provided physicians and nurse practitioners to 12 long-term
care facilities in Ontario (six in Ottawa and six in the Greater Toronto Area
("GTA")). The Company has developed and now sells a comprehensive eight-part
training program for registered nursing staff that it conducts twice annually
for several of its long-term care facility clients. The Company intends to
expand this business unit in 2003 to provide services to 20 facilities.


RESULTS OF OPERATIONS

NET LOSS

The Company incurred a net loss of $ 753,634, or (0.08) per common share for the
three months ended June 30, 2003 compared to a net loss of $240,321, or (0.03)
per common share for the three months ended June 30, 2002. The net loss was
$1,676,736, or (0.18) per common share for the six months ended June 30, 2003
compared to $252,561, or (0.03) per common share for the six months ended June
30, 2002.

REVENUE

The Company's revenue for the three months ended June 30, 2003 increased to
$18,412,652, compared to $ 11,310,318 for the three months ended June 30, 2002,
or by 63%. For the six months ended June 30, 2003 revenue increased to
$31,556,472 compared to $21,051,852 for the six months ended June 30, 2002.

This revenue growth was largely attributable to the DND management service
contract whereby MEII staffed an increased number of health providers in the
first two quarters of fiscal 2003 versus the prior year. The Hospital staffing
division had increased revenues in the first 6 months of 2003 compared to the
prior year as MEII was involved in staffing physician and nurse practitioners to
help support existing healthcare providers during the recent SARS outbreak. The
Long-term care and Pharmaceutical Support business units have also been
responsible for increased revenues for the period ending June 30, 2003.

Revenue from the Government Healthcare Services Division amounted to $10,749,671
for the three months ended June 30, 2003 compared to $7,966,246 for the three
months ended June 30, 2002. Governmental Healthcare Services revenue for the six
months ended June 30, 2003 increased to $20,277,933 from $14,490,521 for the six
months ended June 30, 2002. As at June 30, 2003, the Company provided
approximately 850 medical personnel at DND bases across Canada, compared to 730
as at June 30, 2002.

Revenues from the Hospital Staffing unit increased to $5,376,219 for the three
months ended June 30, 2003 compared to $1,308,967 for the three months ended
June 30, 2002 an increase of approximately 311%. For the six months ended June
30, 2003 Hospital Staffing revenue increased to $6,934,595 from $2,554,279 an
increase of $4,380,316 or by 171%. The increase in revenues is the result of the

<PAGE>

Company providing extensive support to the existing healthcare infrastructure
during the SARS outbreak in the GTA. As described above, MEII provided 246
healthcare professionals and over 44,000 hours to assist the Ministry of Health
for Ontario in combating the SARS epidemic. See Hospital Staffing for greater
details.

For the three months ended June 30, 2003, revenues from Medical Clinics unit
increased to $2,286,762 or approximately 12.4% from $2,035,105 for the three
months ended June 30, 2002. Medical Clinics revenue for the six months ended
June 30, 2003 increased to $4,343,944 from $4,006,552 an increase of $337,392 or
8.5%. The increase resulted from the higher revenues achieved from the
Pharmaceutical support division for the period ending June 30, 2003 compared to
the six months ended June 30, 2002.

GROSS MARGIN

Gross Margin (revenue less physician and other direct costs) for the three
months ended June 30, 2003 increased to $2,429,477 or about 46%, compared to
$1,663,184 for the three months ended June 30, 2002. For the six months ended
June 30, 2003, gross margin increased to $4,254,319 or approximately 32% from
$3,219,757 for the six months ended June 30, 2002. This increase in gross margin
was due to the DND management service contract and the Hospital Staffing,
Long-term care, and Pharmaceutical support business units all experiencing
higher volumes.

Physician fees and direct costs for the quarter ended June 30, 2003 increased to
$ 15,983,175, compared to $ 9,647,134 for the three months ended June 30, 2002,
an increase of approximately 66%. The physician fees and direct costs for the
six months ended June 30, 2003 was $27,302,153 compared to $17,832,095 for the
six months ended June 30, 2002. Physician fees and other direct costs increased
as a percent of revenue to approximately 87% of revenue for the six months ended
June 30, 2003 compared to approximately 85% of revenue for the six months ended
June 30, 2002.

OPERATING EXPENSES

Operating expenses totaled $2,485,491 for the three months ended June 30, 2003
compared to $1,576,557 for the three months ended June 30, 2002, an increase of
approximately 58%. For the six months ended June 30, 2003 operating expenses
increased to $4,248,695 or approximately 44% from $2,953,493 for the six months
ended June 30, 2002. The increase is mainly as a provision for estimated
adjustments from the DND audit of the terms of the Government Healthcare
Services contract. MEII is currently remedying these issues. It is Management's
opinion that such expenses will not continue beyond Q1 of 2004. Also, with the
growing pharmaceutical support division, the increased number of long-term care
facility contracts, and new business development MEII has had to incur increased
costs during the first half of 2003.

INCOME TAXES

The Company has loss carry forwards of approximately $5.0 million to be applied
against future corporate income taxes. This benefit has not been reflected in
these statements.

LIQUIDITY AND CAPITAL RESOURCES

As at June 30, 2003, the Company had a working capital deficit of $3,273,942 as
compared to $2,276,540 as at December 31, 2002.

On May 24, 2002 the Company issued a $720,000 secured debenture for net proceeds
of $600,000. On July 2, 2003, the Company repaid the secured debenture in full
(see note 5 and 6 for more details).

The company finances working capital needs for the DND contract through a
financing facility with MFSL in the amount of $2.7 million ($4.3 million
Canadian funds). This facility has recently been amended (see note 5 for more
details).

<PAGE>

In June 2002, MFSL provided the Company an additional full recourse invoice
discounting facility of up to $475,406 ($750,000 CDN) to support its general
working capital needs. This financing facility has been increased up to $742,115
($1,000,000 CDN) (see note 5 for more details).

The additional facility is secured by a general security agreement (see note 5
for more details).


ITEM 3: QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

There are no financial instruments that are sensitive to changes in interest
rates.

The Company has a financial instrument (see note 6 for details on secured
debenture) that has exposure to foreign currency exchange gains/losses.


ITEM 4: CONTROLS AND PROCEDURES

Included on the signature page of this report is the Certification that is
required under Section 302 of the Sarbanes-Oxley Act of 2002. This section of
the report contains information concerning the controls evaluation referred to
in the Section 302 Certifications and the information contained herein should be
read in conjunction with the Certification.

Internal controls are designed with the objective of ensuring that assets are
safeguarded, transactions are authorized, and financial reports are prepared on
a timely basis in accordance with generally accepted accounting principles in
the United States. The disclosure procedures are designed to comply with the
regulations established by the Securities and Exchange Commission.

Internal controls, no matter how designed, have limitations. It is the Company's
intent that the internal controls be conceived to provide adequate, but not
absolute, assurance that the objectives of the controls are met on a consistent
basis. Management plans to continue its review of internal controls and
disclosure procedures on an ongoing basis.

The Company's chief executive officer, after supervising and participating in an
evaluation of the effectiveness of the Company's internal and disclosure
controls and procedures during the six months ended June 30, 2003 (the
"Evaluation Date"), has concluded that as of the Evaluation Date, the Company's
internal and disclosure controls and procedures were effective.

There were no significant changes in the Company's internal and disclosure
controls or in other factors that could significantly affect such internal and
disclosure controls subsequent to the date of their evaluation.

<PAGE>

PART II:  OTHER INFORMATION

ITEM 5. EXHIBITS AND REPORTS OF FORM 8-K

a) 99.1 CERTIFICATION OF CEO PURSUANT TO SECTION 906 OF
   THE SARBANES-OXLEY ACT OF 2002
   99.2 CERTIFICATION OF CFO PURSUANT TO SECTION 906 OF
   THE SARBANES-OXLEY ACT OF 2002

CERTIFICATIONs

I, Dr. Ramesh Zacharias, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Med-Emerg
International, Inc.;

2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this quarterly
report;

3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;

4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

          a) designed such disclosure controls and procedures to ensure that
material information relating to the registrant, including its consolidated
subsidiaries, is made known to us by others within those entities, particularly
during the period in which this quarterly report is being prepared;

          b) evaluated the effectiveness of the registrant's disclosure controls
and procedures as of a date within 90 days prior to the filing date of this
quarterly report (the "Evaluation Date"); and

          c) presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based on our evaluation
as of the Evaluation Date.

5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation, to the registrant's auditors and the audit committee of
registrant's board of directors (or persons performing the equivalent
functions):

          a) all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to record,
process, summarize and report financial data and have identified for the
registrant's auditors any material weaknesses in internal controls; and

          b) any fraud, whether or not material, that involves management or
other employees who have a significant role in the registrant's internal
controls.

6. The registrant's other certifying officers and I have indicated in this
quarterly report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.

Date: August 13, 2003

                                                      __________________________
                                                      Dr. Ramesh Zacharias
                                                      Chief Executive Officer
<PAGE>

I, William Danis, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Med-Emerg
International, Inc.;

2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this quarterly
report;

3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;

4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

          a) designed such disclosure controls and procedures to ensure that
material information relating to the registrant, including its consolidated
subsidiaries, is made known to us by others within those entities, particularly
during the period in which this quarterly report is being prepared;

          b) evaluated the effectiveness of the registrant's disclosure controls
and procedures as of a date within 90 days prior to the filing date of this
quarterly report (the "Evaluation Date"); and

          c) presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based on our evaluation
as of the Evaluation Date.

5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation, to the registrant's auditors and the audit committee of
registrant's board of directors (or persons performing the equivalent
functions):

          a) all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to record,
process, summarize and report financial data and have identified for the
registrant's auditors any material weaknesses in internal controls; and

          b) any fraud, whether or not material, that involves management or
other employees who have a significant role in the registrant's internal
controls.

6. The registrant's other certifying officers and I have indicated in this
quarterly report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.

Date: August 13, 2003

                                                   _____________________________
                                                   William Danis
                                                   Chief Financial Officer


b) There were no reports filed on form 8-K during the second quarter of
fiscal 2003.

<PAGE>

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant caused this report to be signed on its behalf by the undersigned
thereunto duly authorized.


                                       MED-EMERG INTERNATIONAL INC.


                                       By: /s/ Ramesh Zacharias
                                          --------------------------------------
                                               Ramesh Zacharias
                                               Chief Executive Officer

Date: August 13, 2003