<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, 1999
                              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

          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 /   /

          As of July 26, 1999, 3,095,544 shares of the registrant's Common
Stock were outstanding.

<PAGE>

MED-EMERG INTERNATIONAL INC.
Consolidated Balance Sheets
June 30, 1999 (unaudited) and December 31, 1998
(Expressed in Canadian dollars)

<TABLE>
<CAPTION>

                                                                 June 30            December 31
                                                                    1999                   1998
                                                                 -------            -----------
                                                                  CDN  $                 CDN  $
<S>                                                      <C>                     <C>
                   ASSETS
CURRENT ASSETS

   Cash                                                  $       284,453         $   1,669,899
   Accounts receivable                                         3,071,253             2,765,491
   Prepaid expenses and other                                    724,558               439,310
                                                         ---------------         -------------
                                                               4,080,264             4,874,700

LOANS AND ADVANCES                                               130,975               135,175
CAPITAL ASSETS                                                 1,392,946               883,463
OTHER ASSETS                                                   2,017,662             1,763,330
DEFERRED INCOME TAXES                                            898,961               695,800
                                                         ---------------         -------------
                                                         $     8,520,808         $   8,352,468
                                                         ---------------         -------------
                                                         ---------------         -------------

    LIABILITIES AND SHAREHOLDERS' EQUITY

CURRENT LIABILITIES

   Bank indebtedness                                     $       142,558         $     209,281
   Accounts payable and accrued liabilities                    2,383,329             2,282,658
   Lease obligation - current portion                             93,070                87,401
                                                         ---------------         -------------
                                                               2,618,957             2,579,340

BANK TERM LOAN                                                   337,773                   -
OBLIGATION UNDER CAPITAL LEASE                                    54,356               102,322
DUE TO MINORITY SHAREHOLDERS                                      30,137                   -
                                                         ---------------         -------------
                                                               3,041,223             2,681,662
                                                         ---------------         -------------

MINORITY INTEREST                                                141,585                   -

SHAREHOLDERS' EQUITY
      Capital Stock                                            8,325,811             8,328,164
      Convertible debenture                                      590,625               590,625
      Contributed surplus                                      1,316,980             1,316,980
      Deficit                                                 (4,895,416)           (4,564,963)
                                                         ---------------         -------------
                                                               5,338,000             5,670,806
                                                         ---------------         -------------
                                                         $     8,520,808         $   8,352,468
                                                         ---------------         -------------

</TABLE>

<PAGE>

MED-EMERG INTERNATIONAL INC.
Consolidated Statements of Operations
Three months and six months ended June 30, 1999 (unaudited) and 1998 (unaudited)
(Expressed in Canadian dollars)

<TABLE>
<CAPTION>

                                                                        Three Months Ended                     Six Months Ended
                                                                  -------------------------------           ------------------------
                                                                       June 30            June 30           June 30          June 30
                                                                          1999               1998              1999             1998
                                                                  ------------       ------------      ------------     ------------
                                                                          CDN$               CDN$              CDN$             CDN$
<S>                                                               <C>                <C>               <C>              <C>
REVENUE                                                           $ 4,539,113        $ 3,566,201       $ 8,768,298      $ 7,171,300

PHYSICIAN FEES AND OTHER DIRECT COSTS                               3,257,410          2,823,072         6,332,448        5,704,514
                                                                  ------------       ------------      ------------     ------------
                                                                    1,281,703            743,129         2,435,850        1,466,786
                                                                  ------------       ------------      ------------     ------------

EXPENSES
        Salaries and benefits                                         596,736            423,104         1,116,253          838,226
        General and administrative                                    223,883            117,363           385,305          212,583
        Occupancy costs and supplies                                  267,047            113,084           479,494          201,935
        HealthyConnect.com development                                151,598               -              306,747             -
        Public company costs                                          110,053             32,728           228,656           67,270
        Travel and marketing                                           54,058             59,714           111,823           97,664
                                                                  ------------       ------------      ------------     ------------
                                                                    1,403,375            745,993         2,628,278        1,417,678
                                                                  ------------       ------------      ------------     ------------

EARNINGS (LOSS) FROM OPERATIONS                                      (121,672)            (2,864)         (192,428)          49,108

        Interest and financing expense                                  8,510            (30,133)           11,175          (24,886)
        Amortization                                                  112,282             38,101           207,849           69,922
                                                                  ------------       ------------      ------------     ------------

NET INCOME (LOSS) BEFORE TAXES                                       (242,464)           (10,832)         (411,452)           4,072

        Income tax recovery                                           106,684              2,776           181,039            1,099
                                                                  ------------       ------------      ------------     ------------

NET INCOME (LOSS)                                                 $  (135,780)       $    (8,056)      $  (230,413)     $     2,973

PREFERRED SHARE DIVIDENDS                                             (49,116)           (49,632)         (100,035)         (70,619)
                                                                  ------------       ------------      ------------     ------------
NET INCOME (LOSS) APPLICABLE TO COMMON SHARES                     $  (184,896)       $   (57,688)      $  (330,448)     $   (67,646)
                                                                  ------------       ------------      ------------     ------------
                                                                  ------------       ------------      ------------     ------------


NET INCOME (LOSS) BEFORE PREFERRED SHARE
        DIVIDEND, PER COMMON SHARE                                $     (0.04)       $     (0.00)      $     (0.07)     $      0.00

PREFERRED SHARE DIVIDEND, PER COMMON SHARE                        $     (0.02)       $     (0.02)      $     (0.03)     $     (0.02)
                                                                  ------------       ------------      ------------     ------------

BASIC & FULLY DILUTED INCOME (LOSS),
        PER COMMON SHARE                                          $     (0.06)       $     (0.02)      $     (0.10)     $     (0.02)
                                                                  ------------       ------------      ------------     ------------
                                                                  ------------       ------------      ------------     ------------


WEIGHTED AVERAGE NUMBER OF COMMON SHARES                            3,095,544          3,140,044         3,095,544        3,140,044
                                                                  ------------       ------------      ------------     ------------
                                                                  ------------       ------------      ------------     ------------

</TABLE>

<PAGE>

MED-EMERG INTERNATIONAL INC.
Consolidated Statements of Changes in Financial Position
Six months ended June 30, 1999 (unaudited) and 1998 (unaudited)
(Expressed in Canadian dollars)

<TABLE>
<CAPTION>

                                                                         June 30                   June 30
                                                                            1999                      1998
                                                                 ---------------        ------------------
                                                                          CDN  $                    CDN  $
<S>                                                              <C>                    <C>
OPERATING ACTIVITIES
   Net income (loss) for the period                              $      (230,413)           $        2,973
   Items not affecting cash
       Amortization                                                      207,849                    69,922
       Deferred income taxes                                            (203,161)                   (8,478)
                                                                 ---------------            ---------------
                                                                        (225,725)                   64,417
   Changes in non-cash working capital
       Accounts receivable                                              (265,762)                 (192,281)
       Prepaid and other                                                (285,259)                   26,667
       Accounts payable and accrued liabilities                          100,672                  (238,431)
                                                                 ---------------            --------------
   Cash provided by (used in) operating activities                      (676,074)                 (339,628)
                                                                 ---------------            --------------

INVESTING ACTIVITIES
   Acquisitions                                                         (194,520)                 (787,500)
   Additions of capital assets                                          (639,829)                 (230,935)
   Loans and advances                                                    (20,123)                    8,387
   Other assets                                                         (152,987)                  405,249
   Minority interest                                                     141,585                         -
                                                                 ---------------            --------------
                                                                        (865,874)                 (604,799)
                                                                 ---------------            --------------

FINANCING ACTIVITIES
   Bank term loan                                                        337,773                         -
   Issuance of common shares and warrants                                      -                 4,976,605
   Issuance of convertible debenture                                           -                   590,625
   Repurchase of common shares                                            (2,353)                        -
   Obligation under capital lease                                        (42,297)                  102,388
   Repayment of promissory note                                                -                  (941,074)
   Due to minority shareholders                                           30,137                         -
   Preferred share dividends                                            (100,035)                  (70,619)
                                                                 ---------------            --------------
                                                                         223,225                 4,657,925
                                                                 ---------------            --------------

Increase (decrease) in cash during in the period                      (1,318,723)                3,713,498
Cash position, beginning of period                                     1,460,618                  (851,834)
                                                                 ---------------            --------------
Cash position, end of period                                     $       141,895            $    2,861,664
                                                                 ---------------            --------------
                                                                 ---------------            --------------

Cash position is comprised of:
   Cash                                                          $       284,453            $    3,001,084
   Bank indebtedness                                                 (142,558)                 (139,420)
                                                                 ---------------            --------------
                                                                 $       141,895            $    2,861,664
                                                                 ---------------            --------------
                                                                 ---------------            --------------
</TABLE>


<PAGE>

MED-EMERG INTERNATIONAL INC.
Notes to Unaudited Consolidated Financial Statements
Six months ended June 30, 1999 and 1998


1.   ORGANIZATION AND DESCRIPTION OF BUSINESS

     Med-Emerg International Inc. is a publicly traded company listed on the
     NASDAQ Small Cap Market.  The Company completed its initial public
     offering in February, 1998.

     Med-Emerg International Inc. is a physician management services
     organization specializing in the delivery of emergency and primary
     healthcare related services.  The Company is committed through
     information technology and its platform as a management services
     organization to delivering an internet-based healthcare network with the
     objective of delivering quality, timely and access to healthcare
     products and services.

     The Company's operations are divided into three divisions, Physician and
     Nurse Recruitment, Physician Management Services and Integrated Health
     Services Delivery Network.

     On a contractual basis, the Company provides emergency department
     physician and nurse recruitment, staffing and administrative support
     services to hospitals.  At June 30, 1999, the Company had 15 contracts
     under its management.

     Under physician management services, the Company owns and manages
     medical clinic facilities providing physicians with the ability to
     practice within a professional managed network enabling the physician to
     concentrate on the clinical aspects of their practices.  All the clinic
     assets including medical equipment are owned by the company.  At June
     30, 1999, the Company owned and managed 10 clinics.

     The Company has newly created a division called HealthyConnect.com.
     HealthyConnect.com is an internet-based network that connects
     physicians, patients, third party payors and consumers to a "virtual
     world" of healthcare products and services.  The Company is
     electronically connecting its clinical facilities and establishing
     strategic partnerships in delivering a comprehensive healthcare program.

2.   BASIS OF PRESENTATION

     The accompanying unaudited consolidated financial statements have been
     prepared in accordance with Canadian generally accepted accounting
     principles for interim financial reporting.  These financial statements
     consolidate, with minority interest, the accounts of Med-Emerg
     International Inc. and all wholly- and partially owned subsidiaries of
     Med-Emerg International Inc.

     In the opinion of management, the unaudited interim consolidated
     financial statements contained in this report reflect all adjustments,
     consisting of only normal recurring accruals, which are necessary for a
     fair presentation of the financial position, and the results of
     operations for the interim periods presented.  The results of operations
     for any interim period are not necessarily indicative of the results for
     the full year.

     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, 1998.




<PAGE>

MED-EMERG INTERNATIONAL INC.
Notes to Unaudited Consolidated Financial Statements
Six months ended June 30, 1999 and 1998


3.   ACQUISITIONS

     During the first six months of 1999, the Company acquired ownership
     interests in the following companies that operate medical clinics:  45%
     of Medical Urgent Care Inc., 51% of Caremedics (Elmvale) Inc. and 51% of
     York Lanes Health Centres Ltd.

     The following is a summary of assets purchased and liabilities assumed:


<TABLE>
<CAPTION>

                                           Medical   Caremedics       York Lanes
                                       Urgent Care    (Elmvale)           Health
                                              Inc.         Inc.     Centres Ltd.       Total
                                       -----------   ----------     ------------   ---------

     <S>                               <C>           <C>            <C>            <C>
     Current assets                      $  20,983    $  28,182        $  19,891   $  69,056
     Capital assets                        475,069       13,937           60,000     549,006
     Goodwill                              167,788       26,706             -        194,494
     Less liabilities assumed             (423,840)     (10,484)         (40,744)   (475,068)
     Less minority interest               (129,480)      25,659          (39,147)   (142,968)
                                       -----------   ----------     ------------   ---------
                                         $ 110,520    $  84,000             -      $ 194,520
                                       -----------   ----------     ------------   ---------
                                       -----------   ----------     ------------   ---------

</TABLE>


4.   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 applicable to the
     Company, with those in the United States ("U.S. GAAP") during the
     periods presented except with respect to the following:

     Consolidated statements of operations

     If United States GAAP were employed, net loss for the period would be
     adjusted as follows:

<TABLE>
<CAPTION>

                                                     Three months ended            Six months ended
                                                           June         June         June            June
                                                           1999         1998         1999            1998
                                                    -----------------------------------------------------
 <S>                                                <C>           <C>         <C>             <C>
 Net income (loss) based on Canadian GAAP           $ (135,780)   $  (8,056)  $ (230,413)     $     2,973
 Deferred start-up costs amortized/(deferred)            16,710     (75,665)      33,420         (160,790)
                                                    -----------------------------------------------------

 Net loss based on United States GAAO               $ (119,070)   $ (83,721)  $ (196,993)     $ (157,817)
                                                    -----------------------------------------------------
                                                    -----------------------------------------------------

 Primary loss per share                             $    (0.05)   $   (0.04)  $    (0.10)     $    (0.08)
                                                    -----------------------------------------------------
                                                    -----------------------------------------------------

</TABLE>

     If United States GAAP were employed, deficit, other assets, prepaid and
     other assets, and total liabilities would be adjusted as follows:

<PAGE>

MED-EMERG INTERNATIONAL INC.
Notes to Unaudited Consolidated Financial Statements
Six months ended June 30, 1999 and 1998



4.   CANADIAN AND UNITED STATES ACCOUNTING POLICY DIFFERENCES (cont'd)

<TABLE>
<CAPTION>

                                                                  June            December
                                                                  1999                1998
                                                         -------------       -------------
     <S>                                                 <C>                 <C>
     Deficit based on Canadian GAAP                      $  (4,895,416)      $  (4,564,963)
     Deferred start-up costs                                  (387,752)           (421,172)
                                                         -------------       -------------
                                                         $  (5,283,168)      $  (4,986,135)
                                                         -------------       -------------
                                                         -------------       -------------

     Other assets based on Canadian GAAP                 $   2,017,662       $   1,763,330
     Deferred start-up costs                                  (387,752)           (421,172)
                                                         -------------       -------------
                                                         $   1,629,910       $   1,342,158
                                                         -------------       -------------
                                                         -------------       -------------

     Total liabilities based on Canadian GAAP            $   3,041,223       $   2,681,662
     Convertible debenture                                     590,625             590,625
                                                         -------------       -------------
                                                         $   3,631,848       $   3,272,287
                                                         -------------       -------------
                                                         -------------       -------------
</TABLE>


     (a)  Deferred Income Taxes

          Under U.S. GAAP, the Company is required to follow Statement of
          Financial Accounting Standards (SFAS No. 109) "Accounting for
          Income Taxes", which requires the use of the "asset and liability
          method" of accounting for deferred income taxes, which gives
          recognition to deferred taxes on all "temporary differences"
          (differences between accounting basis and tax basis of the
          Company's assets and liabilities, such as the non-deductible values
          attributed to assets in a business combination) using current
          enacted tax rates.  In addition, SFAS No. 109 requires the Company
          to record all deferred tax assets, including future tax benefits of
          capital losses carried forward, and to record a "valuation
          allowance" for any deferred tax assets where it is more likely than
          not that the asset will not be realized.  The Company has followed
          this method under Canadian GAAP.


     (b)  Deferred Start-up Costs

          Under Canadian GAAP, development and start-up costs, which meet
          certain criteria, are deferred and amortized.  Under United States
          GAAP, development and start-up costs are expensed as incurred.

<PAGE>

MED-EMERG INTERNATIONAL INC.
Notes to Unaudited Consolidated Financial Statements
Six months ended June 30, 1999 and 1998


4.   CANADIAN AND UNITED STATES ACCOUNTING POLICY DIFFERENCES (cont'd)

     (c)  Convertible Debenture

          Under U.S. GAAP, convertible debentures are presented as
          liabilities, regardless of the attributes of the convertible
          debenture, and transferred to equity upon conversion, whereas,
          under Canadian GAAP, the likelihood of conversion to equity is
          considered in determining the classification between liability or
          equity.

     (d)  Earnings Per Share

          U.S. GAAP requires common shares and warrants to purchase common
          shares, issued or exercisable at prices below the initial public
          offering ("I.P.O.") price and which were issued within one year
          prior to the initial filing of the registration statement relating
          to the I.P.O., to be treated as if the common shares were
          outstanding from the beginning of the period in the calculation of
          weighted average number of common shares outstanding and loss per
          share, even where such inclusion is anti-dilutive.  Primary
          earnings per common share is determined using the weighted average
          number of shares outstanding during the year, adjusted to reflect
          the application of the treasury stock method for outstanding
          options and warrants in accordance with U.S. GAAP.

     (e)  Shareholders' Equity

          Under U.S. GAAP, loans issued to officers to acquire stock are
          presented as a deduction from shareholders' equity (deficit).

          Under Canadian GAAP, the detachable stock purchase warrants issued
          as in conjunction with the private stock offering on January 22,
          1996 and subsequently surrendered, all as described in note 13 to
          the audited December 31, 1998 consolidated financial statements,
          have been given no recognition in the financial statements.

          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 U.S. GAAP, based on an ascribed fair value of
          $0.05 for each of the 1,000,000 share warrants issued, share
          capital would be lower by $50,000 and, given that the stock
          purchase warrants were cancelled during the year, the carrying
          amount of contributed surplus would be increased by $50,000.

<PAGE>

MED-EMERG INTERNATIONAL INC.
Notes to Unaudited Consolidated Financial Statements
Six months ended June 30, 1999 and 1998


4.   CANADIAN AND UNITED STATES ACCOUNTING POLICY DIFFERENCES (cont'd)

     The effect on shareholders' equity would be as follows:


<TABLE>
<CAPTION>

                                                                       June            December
                                                                       1999                1998
                                                               ------------        ------------

     <S>                                                       <C>                 <C>
     Capital stock (as previously shown)                       $  8,325,811        $  8,328,164
     Ascribed fair value of share purchase
     warrants issued                                                (50,000)            (50,000)
                                                               ------------        ------------
     Capital stock - U.S. GAAP                                    8,275,811           8,278,164
     Share purchase loan to officer                                 (60,000)            (60,000)
                                                               ------------        ------------
     Net capital stock - U.S. GAAP                                8,215,811           8,218,165
                                                               ------------        ------------

     Convertible debenture (as previously shown)                    590,625             590,625
     Convertible debenture included in long-term debt              (590,625)           (590,625)
                                                               ------------        ------------
     Convertible debenture - U.S. GAAP                                -                  -
                                                               ------------        ------------

     Contributed surplus (as previously shown)                    1,316,980           1,316,980
     Share purchase warrants                                         50,000              50,000
                                                               ------------        ------------
     Contributed surplus - U.S. GAAP                              1,366,980           1,366,980
                                                               ------------        ------------

     Deficit - U.S. GAAP                                         (5,283,168)         (4,986,135)
                                                               ------------        ------------

     Shareholders' equity (deficit) - U.S. GAAP                $  4,299,623        $  4,599,010
                                                               ------------        ------------
                                                               ------------        ------------

</TABLE>


     (f)  Consolidated Statement of Changes in Financial Position

          Operating activities reflect interest paid of $28,838 during the
          six months ended June 30, 1999 (June 30, 1998 - $69,175) and income
          taxes paid of nil during the period ended June 30, 1999 (June 30,
          1998 - nil).

          Under U.S. GAAP, bank indebtedness would not be included as a
          component of cash position in the consolidated statement of changes
          in financial position.  Accordingly, the $66,723 decrease at June
          30, 1999 (June 30, 1998 - $1,406,266 decrease) would be presented
          as a financing activity for each year.

     (g)  Comprehensive Income

          Statement of Financial Accounting Standards No. 130, "Reporting
          Comprehensive Income" (SFAS 130), was issued by the Financial
          Accounting Standards Board in June 1997. SFAS 130 establishes
          standards for reporting and display of comprehensive income and its
          components in the financial statements.  SFAS 130 is effective for
          fiscal years beginning after December 15, 1997.  Reclassification
          of financial statements for earlier period provided for comparative
          purposes is required. The adoption of SFAS 130 will have no impact
          on the Company's consolidated results of operations, financial
          position or cash flows.

<PAGE>

MED-EMERG INTERNATIONAL INC.
Notes to Unaudited Consolidated Financial Statements
Six months ended June 30, 1999 and 1998

5.   SEGMENTED INFORMATION

     The Company operates under three divisions:  Physician and Nurse
     Recruitment, Physician Management Services and HealthyConnect.com.

     The Physician and Nurse Recruitment involves contracting 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 Physician Management Services division owns and manages medical
     clinic facilities, which provide physicians with the ability to practice
     medicine in a professionally managed environment.  The clinics include
     family practice, walk-in services, and other related services such as
     massage therapy and chiropractic services.

     The HealthyConnect.com division involves electronically linking clinic
     facilities and other healthcare service providers into a network.  This
     internet-based network will provide healthcare professionals and
     consumers access to medical services, products, communications and
     information tools.

     Details are as follows:

<TABLE>
<CAPTION>

                                                                        June 30, 1999
                                                  -------------------------------------------------------------
                                                   Physician       Physician         Healthy-
                                                     & Nurse      Management          Connect
                                                  Recruiting        Services             .com      Consolidated
                                                  ----------      ----------         --------      ------------
     <S>                                          <C>             <C>                <C>           <C>
                                                              Three months ended June 30, 1999
                                                              --------------------------------
     Revenue                                       2,895,397       1,643,716          -               4,539,113
     Gross margin                                    492,716         788,987          -               1,281,703

     Operating income before Corporate Overhead
     & Public Company-related costs                  348,212         111,743         (152,252)          307,703
     Corporate Overhead                                                                                (319,322)
     Public Company-related costs                                                                      (110,053)
                                                                                                   ------------
     Operating loss                                                                                    (121,672)
                                                                Six months ended June 30, 1999
                                                                ------------------------------

     Revenue                                       5,571,260       3,197,038          -               8,768,298
     Gross margin                                    948,006       1,487,844          -               2,435,850

     Operating income before Corporate Overhead
     & Public Company-related costs                  678,395         293,093         (307,400)          664,088
     Corporate Overhead                                                                                (627,860)
     Public Company-related costs                                                                      (228,656)
                                                                                                   ------------
     Operating loss                                                                                    (192,428)

     Assets employed at period end                 5,241,526       3,007,642          271,640         8,520,808
     Depreciation and amortization                    72,748         135,101            -               207,849
     Capital expenditures                             17,857         621,972            -               639,829

</TABLE>

<PAGE>

MED-EMERG INTERNATIONAL INC.
Notes to Unaudited Consolidated Financial Statements
Six months ended June 30, 1999 and 1998


5.   SEGMENTED INFORMATION (cont'd)

<TABLE>
<CAPTION>


                                                                         June 30, 1998
                                                  -------------------------------------------------------------
                                                   Physician       Physician         Healthy-
                                                     & Nurse      Management          Connect
                                                  Recruiting        Services             .com      Consolidated
                                                  ----------      ----------         --------      ------------
     <S>                                          <C>             <C>                <C>           <C>
                                                                Three months ended June 30, 1998
                                                                --------------------------------

     Revenue                                       2,783,932         782,269          -               3,566,201
     Gross margin                                    433,347         309,782          -                 743,129

     Operating income before Corporate Overhead
      & Public Company-related costs                 298,591         125,467          -                 424,058
     Corporate Overhead                                                                                (394,194)
     Public Company-related costs                                                                       (32,728)
                                                                                                   ------------
     Operating loss                                                                                      (2,864)
                                                               Six months ended June 30, 1998
                                                               ------------------------------

     Revenue                                       5,668,384       1,502,916          -               7,171,300
     Gross margin                                    854,837         611,949          -               1,466,786

     Operating income before Corporate Overhead
     & Public Company-related costs                  538,029         282,198          -                 820,227
     Corporate Overhead                                                                                (703,849)
     Public Company-related costs                                                                       (67,270)
                                                                                                   ------------
     Operating loss                                                                                      49,108

     Assets employed at year end                   6,239,799       1,977,972          -               8,217,771
     Depreciation and amortization                    29,966          39,956          -                  69,922
     Capital expenditures                             11,419         219,516          -                 230,935

</TABLE>

<PAGE>

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

OVERVIEW

     Med-Emerg International, Inc. ("Med-Emerg" or the "Company"), 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 for hospitals and
clinics in Canada. Though emergency-related services are still an important
component of the Company's business, Med-Emerg has expanded to offer a wide
variety of medical services including recruitment, nurse staffing, physician
management services and an internet-based healthcare network.

     Med-Emerg is positioned to establish industry leadership by providing
integrated professional management services in the delivery of healthcare to
the healthcare consumer.  The Company's operations are divided into three
divisions: Physician and Nurse Recruitment Services, Physician Management
Services and an internet based healthcare network called HealthyConnect.com.
Med-Emerg's strategy is to remain focussed on these three divisions while
continuing to broaden its consolidation of physicians over a wider geographic
base.  Med-Emerg believes that it is well positioned to benefit from the
aging of the baby boomer population, to capitalize on recent developments
within the North American healthcare environment and to integrate
opportunities available through internet technology.  Specifically, the
Company's strategy is to leverage its 15 years of physician recruitment
experience in becoming a dominant player in Physician Management Services and
to develop an internet-based healthcare network that connects physicians,
patients, third party payors and consumers to a "virtual world" of healthcare
products, services and health information.

     The Company continues to promote its medical manpower staffing services
throughout Canada.  Demand for emergency care has grown significantly over
the past ten years, notwithstanding the small proportion of physicians
focusing on emergency medicine. Moreover, recruitment of experienced
emergency medicine practitioners by hospitals in other countries is intense
and such demand is expected to continue for some time. Given the
uncertainties associated with patient volumes in several Ontario hospital
emergency departments, the pool of available physicians willing to practice
emergency medicine has been declining.

     The Company's ability to provide solutions and source physicians and
highly skilled nurses will be enhanced by its success in developing its
dominant status in the Physician Management Services Organization (PMSO)
sector.  The Company's business strategy is to integrate and through its
physicians program offer the family physician a comprehensive practice
opportunity.  Management believes that the creation of a dominant PMSO status
will significantly contribute to the Company's efforts in growing its
emergency services recruitment division.  It is management's intention to
continue to market its PMSO services to the Canadian physician community,
which totals approximately 55,000 members strong and collects annual billings
of approximately $11.0 billion.

     In July 1999, Med-Emerg formed a strategic alliance with Laser
Rejuvenation Clinics Ltd. (LRC), a publicly listed company on the Alberta
Stock Exchange offering a full range of laser cosmetic procedures in its
clinic operations located in Ontario, Alberta, Manitoba and -ritish Columbia,
Canada.  The co-management agreement calls for the cross-marketing of LRC's
full range of laser and cosmetic procedures to Med-Emerg's patient base
throughout both Med-Emerg and LRC's clinic network.  The co-management
agreement includes the use of LRC's fully trained staff and portable laser
equipment in certain Med-Emerg clinics with no capital equipment investment
required by Med-Emerg, which will result in increasing the revenue per square
foot generated by Med-Emerg's physician management services group.

     In June 1999, Med-Emerg entered into an agreement to purchase YFMC
Healthcare Inc., a publicly listed company on the Alberta Stock Exchange, to
be acquired by Med-Emerg through a stock swap.  YFMC Healthcare Inc. is a
leading Canadian physician management services organization that owns

<PAGE>

and manages 20 medical clinics with annual gross revenues of approximately
$11.2 million.  The transaction is expected to close at the end of the third
quarter of 1999.

     In March 1999, the Company purchased 51% of the outstanding capital of
Caremedics (Elmvale) Inc., a multi-physician primary healthcare clinic
located in Ottawa, Canada.  The Company entered into a five-year management
services agreement to manage the clinic for a monthly fee based on revenues
generated by the clinic.

     In February 1999, the Company became party to a lease for the clinic
located within York University in Toronto, Canada.  The Company has entered
into a five-year management services agreement to manage the clinic for a
monthly fee based on revenues generated by the clinic.  The Company has a 51%
interest in the company that owns the clinic.

     In January 1999, the Company acquired a 45% interest in an Urgent Care
Centre, Medical Urgent Care Inc.  The Company developed and opened its first
Urgent Care Centre in September 1997.  The Urgent Care Centre concept
consists of a group of emergency trained physicians, a medical laboratory, a
diagnostic radiology service, and a pharmacy, each of which must be present
for the others to co-exist, and each of which is provided by a separately
owned company.  The Company manages the clinic component of the Urgent Care
Centre and provides the support staff for this component.  Ownership of
Medical Urgent Care Inc. is shared with the group of emergency trained
physicians that provides the medical service in the clinic component.

     In the first quarter of 1999, the company launched an internet-based
healthcare network, called HealthyConnect.com, that will provide a secured
virtual private internet-based healthcare network connecting physician,
hospitals, third party payers, and consumers.  HealthyConnect.com's network
will allow its customers and strategic partners to access and exchange
healthcare related information, purchase healthcare products and services,
and communicate more efficiently with one another.  Through its electronic
platform, HealthyConnect.com will facilitate the business of healthcare
through advanced internet and voice telecommunication technology.
HealthyConnect.com will link healthcare product and service suppliers with
the clinical network patient family.  Convenient and secure access and at
home/at office browsing and purchasing capabilities will facilitate direct
sales opportunities for member suppliers.

     HealthyConnect.com will empower the consumer by providing them with
improved access to validated healthcare information.  Physicians and other
healthcare providers will have access to reliable information and additional
support in delivering cost effective, high quality healthcare services using
all available technologies.  Med-Emerg anticipates that HealthyConnect.com
will generate revenue from three sources;  provider subscription,
advertising, and e-commerce commissions.  Through Med-Emerg's existing
medical clinics, HealthyConnect.com has an immediately accessible potential
customer base of physician practices and patients who have at one time or
another been patients of those practices.  These physicians and patients will
comprise the initial customer based from which HealthyConnect.com will derive
provider subscription fees and transaction or commission fees from e-commerce
sales.  Advertising sponsorship is anticipated from pharmaceutical companies,
community pharmacies and companies with services and products interested in
accessing HealthyConnect.com's network of patients and physicians.

     Management of Med-Emerg sees HealthyConnect.com as a significant
opportunity to create a profitable business line while providing healthcare
organizations with new web-based technologies to increase practice
efficiency, achieve measurable cost savings and improve the quality of care.

RESULTS OF OPERATIONS

Six Months Ended June 30, 1999 compared to Six Months Ended June 30, 1998

     REVENUES.  Revenues increased by $972,912 or 27.3% from $3,566,201 in
the second quarter of 1998 to $4,539,113 in the second quarter of 1999.
Year-to-date revenue increased by $1,596,998 or 22.3% to $8,768,298 for the
six months ended June 30, 1999 compared to $7,171,300 for the same period in
1998. The revenue growth is attributable to the clinic acquisitions, growth
in existing clinic business and growth

<PAGE>

in nurse staffing.  In addition, during the second quarter of 1999, Med-Emerg
realized revenues of approximately $282,000 from a one-time contract with
Citizenship and Immigration Canada (the "CIC contract") to provide medical
services to Kosovo refugees.

     Revenues generated by Physician Management Services increased by
$861,447 or 110% from $782,269 in the second quarter of 1998 to $1,643,716
during the second quarter of 1999.  For the six months ended June 30, 1999,
Physician Management Services revenue was $3,197,038, which represents an
increase of $1,694,122 over the six months ended June 30, 1998.  The three
acquisitions that were completed in the second and third quarters of 1998
contributed $435,134 additional revenue to the second quarter of 1999and
$885,715 additional revenue to the six months ended June 30, 1999.  The three
acquisitions that were completed during the first quarter of 1999 contributed
$179,712 to second quarter revenue and $310,744 to revenue for the six months
ended June 30, 1999. The Dundas Urgent Care Centre was a start-up operation
in 1998.  In 1999, this Centre contributed $163,443 to second quarter
revenues and $343,717 for the six months ended June 30, 1999.  The remaining
increase in Physician Management Services revenue is a result of increased
patient volumes and additional physicians working in the family practice and
walk-in clinics.

     Revenues from Physician and Nurse Recruiting increased by $111,465 or
4.0% to $2,895,397 during the second quarter of 1999 from $2,783,932 during
same period for 1998.  Revenues for the six month ended June 30, 1999 were
$5,571,260, a $97,124 decrease from the same period in 1998.  The decrease in
revenue for the six months occurred in the physician staffing component of
this division.  Two new contracts entered into in the latter part of fiscal
1998 and the one-time CIC contract contributed to revenue in the first six
months of 1999, but five contracts in place during the first six months of
1998 were not renewed.  The CIC contract contributed to the increase in
revenue during the second quarter of 1999 compared to 1998.  The nurse
staffing component contributed an additional $188,403 to revenue in the first
six months of 1999 as compared to the same period last year.  This increase
came from a significant increase in the provision of services to one hospital
under an existing contract plus the net addition of three contracts.

     PHYSICIAN FEES AND OTHER DIRECT COSTS.  Physician fees and direct costs,
which primarily represents fees to contract physicians, increased $434,338 or
15.4% from $2,823,072 in the second quarter of 1998 to $3,257,410 in the
second quarter of 1999.  For the six months ended June 30, 1999, physician
fees and direct costs increased $627,934 11.0% to $6,332,448 from $5,704,514
for the six months ended June 30, 1998.  Physician fees and other direct
costs decreased as a percent of revenue, representing 72.2% of revenues for
the six months ended June 30, 1999 and 79.5% of revenues for the six months
ended June 30, 1998.  The decrease as a percent of revenue is largely due to
the mix of revenue between Physician & Nurse Recruiting and Physician
Management Services.  As the Physician Management Services revenues increase,
the larger gross margin related to Physician Management Services results in a
decrease in physician fees and other direct costs as a percent of revenue.

     OPERATING EXPENSES.  Operating expenses have increased by $1,210,600 or
85.4% to $2,628,278 in the first six months of 1999 from $1,417,678 in the
first six months of 1998.  For the second quarter ended June 30, 1999,
operating expenses were $1,403,375, which represents an increase of $657,382
or 88.1% increase over operating expenses for the second quarter ended June
30, 1998. There are several factors contributing to the increase in operating
expenses, including the development of the HealthyConnect.com division, the
clinic acquisitions in 1998 and 1999, and the operations of the Dundas Urgent
Care Centre.

     The company recently launched an integrated health services delivery
network called HealthyConnect.com.  This internet-based healthcare network
will connect physicians, hospitals, third party payors and consumers and
allow all participants to access and exchange healthcare related information,
purchase products and services, and communicate more cost-effectively with
one another. During the second quarter of 1999, the company expensed $152,252
on the development of this concept, for a total year-to-date
HealthyConnect.com development expense of $307,400.

     During the second and third quarters of 1998, the company completed the
acquisitions of two companies, JC Medical Management Inc. and Doctors On Call
Ltd., and acquired the remaining two-thirds

<PAGE>

of the Glenderry Medical Walk-in Clinic.  These acquisitions added $144,294
to operating expenses in the second quarter of 1999 and $274,111 for the six
months ended June 30, 1999.  During the first quarter of 1999, the company
completed the acquisition of a controlling interest in three other companies,
all of which operate medical clinics.  These acquisitions added $237,856 to
operating expenses in the second quarter of 1999 and $349,212 to operating
expenses for the six months ended June 30, 1999.

     During the first quarter of 1998, the Dundas Urgent Care Centre was
considered a start-up operation.  During the first six months of 1999, this
Urgent Care Centre added $142,787 to operating expenses and $63,844 to the
second quarter of 1999 compared to the second quarter of 1998.  The remaining
increase in operating expenses of $137,743 for the six months ended June 30,
1999 compared to the same period in 1998 and $59,790 from first quarter of
1998 to first quarter of 1999 relates to an increase in general overhead
costs.

     NET LOSS.  As a result of the above items, the Company reported a net
loss of $135,780 for the three months ended June 30, 1999 as compared to net
loss of $8,056 for the three months ended June 30, 1998.  Net loss for the
six months ended June 30, 1999 was $230,413 as compared to net income of
$2,973 for the six months ended June 30, 1998. The company's effective tax
rate increased to approximately 44% in 1999 from approximately 26% in 1998
due to the change in status under Canadian taxation rules from a
privately-held company to a company with shares that are publicly traded.

LIQUIDITY AND CAPITAL RESOURCES

     Through its acquisitions completed in the first quarter of 1999, the
Company assumed bank term loans with current balances totaling $337,773.
Approximately $236,390 was loaned to subsidiaries of the Company under the
Small -usiness Investment Loans program in which the Canadian government
guarantees 75% to 90% of the principal balance of the loan.  The remaining
balance consists of capital loans for asset purchases.

     The Company's cash position at June 30, 1999 was $284,453.
Approximately $265,000 of the Company's cash is currently tied up in the CIC
contract.  The Company has paid physicians and nurses working for the Company
relating to the contract, but has not yet received payment from CIC.
Installment payments have been received to date and the remaining balance is
expected to be received in mid-August of 1999. The collection risk for this
cash is very low.

     As at June 30, 1999, the company's working capital totaled $1,461,307.
In addition, the company has available credit facilities for up to
approximately $3,000,000. The Company established credit facilities in June
1998 that provide an available demand, revolving, operating line of credit
amounting to $2,000,000, bearing interest at the bank's prime lending rate
plus 0.5% per annum with interest payable monthly, and an available demand,
non-revolving, capital line of credit amounting to $1,000,000.  The capital
line of credit bears interest at the bank's prime lending rate plus 0.75% per
annum with interest payable monthly.  The company believes that the
combination of funds available under the company's bank credit facility,
together with its current cash position, should be sufficient to meet the
company's operating requirements through 1999.

     In addition, in order to provide the funds necessary for the further
development of HealthyConnect.com  and the continued pursuit of the company's
long-term acquisition strategy, the company expects to issue equity and debt
securities, the availability and terms of which will depend upon market and
other conditions.  There can be no assurance that such additional financing
will be available on terms acceptable to the company.

     Forward-looking statements of Med-Emerg International Inc. 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.

<PAGE>

ITEM 3:        QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

No disclosure required.

<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/ Carl Pahapill
                                   -------------------------------------
                                   Carl Pahapill
                                   President and Chief Operating Officer
Date:  August 16, 1999