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                                                                    EXHIBIT 99.1


                                 CAUTIONARY STATEMENT

    Nutrition Medical, Inc. (the "Company"), or persons acting on behalf of the
Company, or outside reviewers retained by the Company making statements on
behalf of the Company, or underwriters, from time to time may make, in writing
or orally, "forward-looking statements" as defined under the Private Securities
Litigation Reform Act of 1996 (the "Act").  This Cautionary Statement is for the
purpose of qualifying for the "safe harbor" provisions of the Act and is
intended to be a readily available written document that contains factors, any
one of which may cause actual results to differ from those which might be
projected, forecast, estimated or budgeted by in such forward-looking statement.
The factors set forth below are in addition to any other cautionary statements,
written or oral, which may be made or referred to in connection with any such
forward-looking statement.

    The following matters, among others, may have a material adverse effect on
the business, financial condition, liquidity, results of operations or
prospects, financial or otherwise, of the Company:


LACK OF OPERATING PROFITS; LIMITED OPERATING HISTORY

    The Company, which was incorporated in July 1993, is subject to all of the
risks inherent in the establishment of a new business. The likelihood of the
success of the Company must be considered in light of the difficulties, expenses
and delays frequently encountered in connection with the development and
marketing of new products and the competitive environment in which the Company
is operating.

    Although the Company began generating revenues from product sales in
May 1994, the Company has accumulated substantial losses to date.  No assurance
can be given that the Company will be able to achieve profitability. Further,
there can be no assurance that the Company will be able to successfully develop
or market additional products or that the Company will have sufficient funds
available to successfully market its current products or any new products that
it may develop in the future.

PRODUCT ACCEPTANCE AND PRICING

    The Company's products are designed to be substantially equivalent to
existing branded competitive products. Although the Company believes that the
quality and efficacy of its products is comparable to branded competitive
products, no independent comparison between the Company's products and
competitive products has been completed and there can be no assurance that the
efficacy or quality of the Company's products is or will be comparable to
branded competitive products.

    Furthermore, the Company's name and its products are relatively unknown to
large segments of the Company's target markets, and there can be no assurance
that the Company's marketing efforts will achieve sufficient name recognition of
the Company and its products to significantly enhance revenues.

    The principal advantage of the Company's products is, and is expected to
be, lower price. The Company is aware of one competitor in the critical care
nutrition products market that has lowered prices to various customers of its
branded products to levels that offset all or part of the price advantage of the
Company's competitive products. The Company believes that these selective price
reductions resulted in indeterminable lost sales of the Company's competing
products, and that this competitor has begun to use this form of price
competition more frequently. This competitor may decide to consistently lower
its prices to the Company's level, and other competitors may adopt the same
strategy.  The market for the clinical nutrition products acquired from Elan
Pharma, Inc. in January 1997 is expected to be extremely price competitive and
often involves the need to offer package pricing of products.  The Company has
also encountered price competition from other suppliers of adult nutrition
supplements.  Because the Company's marketing strategy is focused on the price
advantage of its products, if a competitor selling competitive products reduces
or eliminates the price advantage of the Company's products, there can be no
assurance that the Company can compete successfully with such a competitor or
operate profitably under such conditions.


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DEVELOPMENT OF NEW PRODUCTS

    The Company intends to continue to develop new products, which will require
both the timely identification of market opportunities and the identification
of, and the negotiation of contracts with, suitable technical consultants. There
can be no assurance that an adequate market opportunity will exist for the
potential products the Company selects for development or that such products
will be successfully developed or marketed.

DEPENDENCE ON CONTRACT MANUFACTURERS

    The Company engages contract manufacturers to produce its products
according to the Company's specifications. The Company relies on these
manufacturers to comply with all applicable government regulations and
manufacturing guidelines. There can be no assurance that contract manufacturers
will consistently supply adequate quantities of the Company's products on a
timely basis, that such manufacturers will consistently comply with government
regulations or that the quality of such products will be consistently
maintained. In the event of a sale of a defective product, the Company would be
exposed to product liability claims and could lose customer confidence. In
addition, minimum quantity order requirements imposed by manufacturers may
result in excess inventory levels, requiring additional working capital and
increasing exposure to losses from inventory obsolescence. Although the Company
believes it could find alternative manufacturers for its products, any
interruption in supply of any of the Company's products could adversely affect
the Company's ability to market its products and, therefore, the Company's
business, financial condition and results of operations.

DEPENDENCE ON RETAIL DISTRIBUTION OF PRODUCTS

    The Company's private label nutrition products are sold only through retail
chains. The Company's strategy includes the development of additional products,
including an infant formula that is currently under development by the Company.
There can be no assurance that the Company will be able to enter into
arrangements with retailers to market its infant formula or any other private
label products or that any such arrangements will result in successful product
commercialization. The Company's future profitability will depend in large part
upon the Company's ability to develop products that meet the needs of these
potential retail customers and upon the marketing efforts of such retailers.
Although the Company believes that its current and prospective retail customers
have an economic motivation to market vigorously the Company's products, the
amount and timing of resources to be devoted to marketing by such retailers is
not within the control of the Company. In addition, successful commercialization
might result in a substantial portion of the Company's revenues being generated
by one or a few retailers. Such retailers could make material marketing and
other commercialization decisions that would adversely affect the Company's
future revenues, financial condition and results of operations.

POSSIBLE FLUCTUATIONS IN OPERATING RESULTS

    The Company believes that its future operating results may be subject to
substantial quarterly fluctuations because its retail customers and a large OEM
pump customer may order large quantities at irregular intervals. In addition,
the gross profit as a percentage of sales on the Company's private label
nutrition products is substantially less than the gross profit percentage on the
Company's critical care and clinical nutrition products, and therefore the
Company's overall gross profit percentage could vary widely based on the product
mix in a given period. To the extent that quarterly revenues and operating
results fluctuate substantially, the market price of the Company's common stock
may be affected.

CUSTOMER CONCENTRATION

    Although the Company's experience with its customer base is limited, retail
customers often place a large initial stocking order that can increase the
relative importance of a particular customer in a particular period.  In
addition, the Company may incur similar concentration issues with large
distributors and OEM customers for its clinical nutrition products, including
the products acquired from Elan.  There can be no assurance that such retail
orders will continue or that its future orders will not significantly decline.


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FUTURE CAPITAL REQUIREMENTS; NO ASSURANCE FUTURE CAPITAL WILL BE AVAILABLE

    Although the Company's existing cash balances are expected to be sufficient
to fund the Company's operations through 1997, under certain circumstances the
Company may require substantial additional funds before the end of 1997 to meet
its working capital requirements in connection with the introduction of new
products, including its proposed infant formula. In order to meet this possible
need, and to meet possible needs after 1997, the Company may be required to
raise additional funds through public or private financings, including equity
financings. Any additional equity financings may be dilutive to purchasers in
this offering, and debt financing, if available, may involve restrictive
covenants. Adequate funds for the Company's operations, regardless of the
source, may not be available when needed or on terms attractive to the Company.
Insufficient funds may require the Company to delay, scale back or eliminate the
introduction of new products, including its proposed infant formula, and the
failure to obtain funding when needed could have a material adverse effect on
the Company's business, financial condition and results of operations.

KEY PERSONNEL

    The Company is particularly dependent on the services of its President,
Mr. William Rush. If the services of Mr. Rush were to become unavailable to the
Company for any reason, there can be no assurance that the Company could
adequately replace him. The loss of Mr. Rush's services could have a material
adverse effect on the Company. The Company has an employment agreement with
Mr. Rush that expires September 30, 1999. The Company currently maintains a life
insurance policy with a face value of $1 million on Mr. Rush.

ADDITION OF MANAGEMENT PERSONNEL AND STAFF

    In order to pursue its growth objectives, the Company intends to increase
the number of its employees, including management personnel and sales and
marketing staff. There can be no assurance that the Company will be able to
hire, train and retain sufficient personnel with the necessary experience and
abilities to achieve the Company's growth objectives, or that they will perform
at a level commensurate with the Company's expectations.

LITIGATION INVOLVING COMPETITORS

    It is not uncommon for companies in the generic and private label industry
to be the subject of claims and lawsuits brought by brand name competitors
alleging that the generic or private label products have formulas, labelings or
packagings similar to competing brand name products. The Company recently
resolved two lawsuits in which competitors alleged patent infringement and false
advertising by the Company, and the Company is currently subject to another suit
alleging patent infringement. Since the Company's business strategy is to
develop and market products that are equivalent to competitors' branded
products, similar claims may be made by competitors in the future. Competitors
may also respond to the Company's strategy by more aggressively seeking patents
on their products to limit the Company's future product development efforts.

    If similar allegations are made against the Company in the future, some of
the Company's current and future products may need to be reformulated or
repackaged in order for the Company to continue to market products that are
comparable to competitors' patented products. While the Company believes that
reformulation of its products is generally possible, the Company may be unable
to effectively reformulate certain of its products, and there can be no
assurance that a reformulated product would be deemed by customers to be
essentially equivalent to the patented product. Moreover, there can be no
assurance that any future lawsuits could be satisfactorily settled by
reformulating, relabeling or repackaging a product, that such litigation will
not require the commitment of substantial management time and legal fees, or
that such litigation would not have a material adverse effect on the Company's
future revenues, financial condition and results of operations.


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COMPETITION

    Competition in the clinical care nutrition products market consists of
established companies that sell branded products which have achieved a high
level of customer awareness. Although the Company believes it is the only
company currently offering low cost, generic alternatives to the established
brands, other companies may enter this market.

    Competition in the private label nutrition market consists of companies
that sell established national brands and companies that sell private label
products. Competitors that sell private label products include established
companies that produce private label products for a wide range of markets and a
number of small producers of private label products. Nearly all of the Company's
competitors and potential competitors have substantially greater financial
resources, more extensive business experience and more personnel than the
Company. The Company's ability to compete will depend on the timeliness of the
development of its products and its ability to market its products effectively.

    If a larger company with significant financial resources were to compete
directly with the Company in particular market segments, there can be no
assurance that the Company will be able to compete successfully with such a
competitor or operate profitably.

PRODUCT LIABILITY AND INSURANCE RISKS

    The Company's business involves exposure to potential product liability
risks that are inherent in the production, manufacture and distribution of food
and medical device products. The Company maintains a general insurance policy
that includes coverage for product liability claims up to an aggregate amount of
$5 million. There can be no assurance, however, that the Company will be able to
maintain such insurance on acceptable terms, that the Company will be able to
secure increased coverage as the commercialization of its products increases or
that any insurance will provide adequate protection against potential
liabilities.

GOVERNMENT REGULATION

    The Company's products and potential products are or will be subject to
government regulation. The Company's current products are regulated as food and
medical food by the Food and Drug Administration (the "FDA") and are subject to
labeling requirements, current good manufacturing practice ("CGMP") regulations
and certain other regulations designed to ensure the safety of the products. The
Company's proposed infant formula will undergo an adequate and well controlled
clinical study, in accordance with good clinical practice, to determine whether
the formula supports normal physical growth in infants when fed as the sole
source of nutrition. There can be no assurance that the Company's proposed
infant formula, if developed, would successfully complete this trial.

    Additionally, the FDA has recently proposed significant revisions to its
infant formula regulations to establish requirements for quality factors and
CGMP, and to amend its quality control procedure, notification, and records and
report requirements for infant formulas. These regulations, if adopted, may
delay, and increase the cost of, the Company's introduction of an infant formula
product.

    Claims made by the Company in labeling and advertising its products are
subject to regulation by the FDA, the Federal Trade Commission and various state
agencies under their general authority to prevent false, misleading and
deceptive trade practices. With the addition of the products acquired from Elan,
the Company will be subject to FDA regulations regarding Class 2 medical
devices.  These regulations involve more stringent tracking, testing and
documentation standards. Failure to comply with such requirements can result in
adverse regulatory action, including injunctions, civil or criminal penalties,
product recalls or the relabeling, reformulation or possible termination of
certain products.

    The Company's current and potential products may become subject to further
regulation in the future. The burden of such regulation could add materially to
the costs and risks of the Company's development and marketing efforts. There
can be no assurance that the Company could obtain the required approvals or
comply with new regulations if the Company's products are subject to additional
governmental regulation in the future. Failure to obtain necessary approvals or
otherwise comply with government regulations could have a material adverse
effect on the Company's future revenues, financial condition and results of
operations.

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CONTROL BY PRINCIPAL SHAREHOLDERS

    Directors, officers and principal shareholders of the Company own
beneficially approximately 41% of the outstanding Common Stock. As a result,
such shareholders may have the ability to effectively control the election of
the Company's entire Board of Directors and the affairs of the Company,
including all fundamental corporate transactions such as mergers, consolidations
and the sale of substantially all of the Company's assets.

TRADEMARKS

    The Company has not registered its existing trademarks, but instead relies
on its common law trademark rights. The lack of such registration may impair the
ability of the Company to prosecute successfully an infringement action against
other users of these trademarks. There can be no assurance that the Company's
marks do not or will not violate the proprietary rights of others, that the
Company's proprietary rights in the marks would be upheld if challenged, or that
the Company would not be prevented from using its marks, any of which could have
an adverse effect on the Company. In addition, there can be no assurance that
the Company will have the financial resources necessary to enforce or defend its
trademarks.

UNDESIGNATED STOCK

    The Company's authorized capital consists of 25,000,000 shares of capital
stock, of which 20,000,000 shares are designated as Common Stock and 5,000,000
are preferred shares undesignated as to series. The Company has no outstanding
shares of preferred stock, and there are no current plans to designate or issue
any shares of preferred stock. Nevertheless, the Company's Board of Directors
has the power to issue any or all of these shares of unissued stock, including
the authority to establish the rights and preferences of the unissued shares,
without shareholder approval. Furthermore, as a Minnesota corporation, the
Company is subject to certain "anti-takeover" provisions of the Minnesota
Business Corporation Act. These provisions and the power to issue additional
shares and to establish separate classes or series of common or preferred stock
may, in certain circumstances, deter or discourage take-over attempts and other
changes in control of the Company not approved by the Board.


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