SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                               ------------------

                                   FORM 10-KSB

                   ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF
                       THE SECURITIES EXCHANGE ACT OF 1934

                  For the fiscal year ended September 30, 2000
                           Commission File No. 1-11182

                         BIO-IMAGING TECHNOLOGIES, INC.
             ------------------------------------------------------
             (Exact Name of Registrant as Specified in Its Charter)

          Delaware                                       11-2872047
-------------------------------             ------------------------------------
(State or Other Jurisdiction of             (I.R.S. Employer Identification No.)
Incorporation or Organization)


826 Newtown-Yardley Road, Newtown, Pennsylvania                      18940-1721
--------------------------------------------------------------------------------
(Address of Principal Executive Offices)                              (Zip Code)

                                 (267) 757-1360
                         -------------------------------
                         (Registrant's Telephone Number,
                              Including Area Code)

           Securities registered pursuant to Section 12(b) of the Act:

    Title of each class                Name of each exchange on which registered
    -------------------                -----------------------------------------

Common Stock, $.00025 par              Boston Stock Exchange
value per share

         Securities registered under Section 12(g) of the Exchange Act:

                                      None

<PAGE>

     Check whether the Registrant: (1) filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act during the past 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:
                    -----------                        ----------


     Check if there is no disclosure  of  delinquent  filers in response to Item
405 of  Regulation  S-B  contained  in  this  form,  and no  disclosure  will be
contained,  to the  best of  Registrant's  knowledge,  in  definitive  proxy  or
information statements incorporated by reference in Part III of this Form 10-KSB
or any amendment to this Form 10-KSB. [X]

     State  Registrant's  revenues  for fiscal year ended  September  30,  2000:
$5,772,443

     State the aggregate market value of the voting stock held by non-affiliates
of the Registrant:  $2,739,040 at November 30, 2000 based on the average bid and
asked prices on that date.

     Indicate  the  number of  shares  outstanding  of each of the  Registrant's
classes of common stock, as of November 30, 2000:

Class                                              Number of Shares
-----                                              ----------------

Common Stock, $.00025 par value                        7,773,878


     Transitional Small Business Disclosure Format

                Yes:                              No:     X
                    -----------                      ----------


     The  following  documents  are  incorporated  by reference  into the Annual
Report on Form 10-KSB:  Portions of the Registrant's  definitive Proxy Statement
for its 2001 Annual Meeting of Stockholders  are  incorporated by reference into
Part III of this Report.

<PAGE>

                                TABLE OF CONTENTS
                                -----------------
              Item                                                         Page
              ----                                                         ----

PART I        1.   Business..................................................1

              2.   Properties................................................9

              3.   Legal Proceedings........................................10

              4.   Submission of Matters to a Vote of Security Holders......10

PART II       5.   Market for the Company's Common Equity and Related
                   Stockholder Matters......................................10

              6.   Management's Discussion and Analysis of Financial
                   Condition and Results of Operations......................11

              7.   Financial Statements.....................................17

              8.   Changes in and Disagreements with Accountants on
                   Accounting and Financial Disclosure......................17

PART III      9.   Directors, Executive Officers, Promoters and Control
                   Persons; Compliance with Section 16 (a) of the
                   Exchange Act.............................................18

              10.  Executive Compensation...................................18

              11.  Security Ownership of Certain Beneficial Owners
                   and Management...........................................18

              12.  Certain Relationships and Related Transactions...........18

              13.  Exhibits, List and Reports on Form 8-K...................18

SIGNATURES..................................................................19

EXHIBIT INDEX...............................................................21

FINANCIAL STATEMENTS.......................................................F-1


                                      -i-
<PAGE>

                                     PART I

ITEM 1.  BUSINESS.

GENERAL

     Bio-Imaging  Technologies,  Inc.  ("Bio-Imaging"  or  "the  Company")  is a
pharmaceutical  contract service  organization,  providing services that support
the product development process of the pharmaceutical, biotechnology and medical
device  industries.  The Company  specializes  in  assisting  its clients in the
design and management of the  medical-imaging  component of clinical  trials for
all  modalities  which  consist  of  computerized  tomography  ("CT"),  magnetic
resonance imaging ("MRI"),  x-rays, dual energy x-ray  absorptiometry  ("DEXA"),
position  emission  tomography  single photon emission  computerized  tomography
("PET SPECT") and ultrasound.

     The Company  utilizes  proprietary  processes and software  applications in
providing its services to pharmaceutical  companies  conducting clinical studies
in which medical imaging modalities are used to evaluate the efficacy and safety
of  pharmaceuticals,  biologics or medical devices.  The Company's digital image
processing  and computer  analysis  techniques  enable it to make highly precise
measurements and  biostatistical  inferences  about drug or device effects.  The
resulting  data enable the Company's  clients,  and their  regulatory  reviewers
(primarily  the U.S.  Food and  Drug  Administration,  the  "FDA"  and  European
Agencies) to evaluate product efficacy and safety. In addition,  the Company has
developed  specialized  computer services and software  applications that enable
independent  radiologists  and other  medical  specialists  involved in clinical
trials to review medical image data in an entirely digital format. The Company's
services also include the regulatory submission of medical images,  quantitative
data and text.

     The  Company  continues  to believe  that it is at an early stage of market
penetration  and is directing  its  marketing  and sales  efforts  towards those
clinical development areas that heavily depend upon medical imaging. These areas
include therapeutic and diagnostic anti-inflammatory,  oncology, central nervous
system, osteoporosis and cardiovascular.

     In February  1997, the Company  opened a European  facility in Leiden,  the
Netherlands  to provide  centralized  image  processing  services  for  European
clients.  The Company  manages its services for European based  clinical  trials
from this facility. The Company's European facility has the same capabilities as
the Company's U.S. headquarters.

     In May 1999, the Company  acquired the operations of Bona Fide, Ltd. ("Bona
Fide").  Bona Fide provides DEXA quality assurance and quality control ("QA/QC")
to the  pharmaceutical  and medical device  industry for studies  requiring bone
densitometry and body composition measurements.

     In September  2000, the Company  announced the formation of a new division,
Bio-Imaging   ETC.   Bio-Imaging   ETC  focuses  on   Education,   Training  and
Certification for medical imaging equipment, facilities and staff.

                                      -1-
<PAGE>

     The  Company  was  incorporated  in  Delaware  in 1987  under the name Wise
Ventures, Inc. The Company's name was changed to Bio-Imaging Technologies,  Inc.
in 1991.  The  address  of the  Company's  principal  executive  offices  is 826
Newtown-Yardley Road, Newtown, Pennsylvania,  18940, and its telephone number is
267-757-1360.

BUSINESS SERVICES

     CORE LABORATORY SERVICES

     Bio-Imaging is a leading  provider of medical imaging  management  services
for  clinical  development  purposes.  The  Company's  imaging  core  laboratory
facilities in the U.S.A. and Europe provide  centralized  image data collection,
processing,  analysis  and  archival  services  for  clinical  trials  conducted
worldwide.  The facilities are designed for high-volume  efficient processing of
analog (film) and digital image data in a secure  environment that complies with
regulatory guidelines for clinical data management.

     Medical  image data are received by  Bio-Imaging  facilities  from clinical
trial  sites,  typically  academic  or  community  hospitals.  The  Company  has
developed  procedures for data tracking and quality  control that it believes to
be of  significant  value  to its  clients.  The  Company's  facilities  contain
specialized  hardware and software for the digitization of films and translation
of digital data, enabling data to be standardized, regardless of its source. The
Company  believes its ability to handle most  commercially  available image file
formats is a valuable technical asset and an important  competitive advantage in
gaining new business for large global multi-center clinical trials.

     The  Company  performs  image  analyses  on client  data  using  internally
developed or specially configured software.  The Company measures key indicators
of drug efficacy in different organs and disease states.  The results from image
analysis derived in Bio-Imaging facilities are transferred to databases that can
be transmitted  electronically to the Company's clients,  or integrated directly
into the Company's  Bio/ImageBase(R)  package for  regulatory  submission on the
client's behalf.

     INFORMATION MANAGEMENT SERVICES

     Bio-Imaging's   information   management   services   focus  on   providing
specialized solutions for improving the quality,  speed and flexibility of image
data  management for clinical  trials.  The Company's  Computer  Assisted Masked
Reading   ("CAMR(TM)")  systems  offer  numerous  advantages  over  conventional
film-based medical image reading scenarios,  including  increased reading speed,
greater  standardization  of image reading,  and reduced error in the capture of
reader interpretations.

     Using the Company's CAMR(TM) systems,  independent  medical specialists can
review medical image data from clinical trials in a digital format. The CAMR(TM)
systems can display all  modalities of medical image data,  regardless of source
equipment.  In addition,  the systems can display either translated digital data
or digitized films. Such image reviews are often required

                                      -2-
<PAGE>

during  clinical  trials to  evaluate  patients'  responses  to  therapy,  or to
determine if patients qualify for studies. By using the CAMR(TM) systems to read
and evaluate image data,  medical  specialists can achieve greater reading speed
than is possible with film,  and can perform  evaluations  in a more  objective,
reproducible manner.

     The Company has also developed remote CAMR(TM)  ("rCAMR(TM)") systems which
are located on the  premises,  either home or office of the  individual  medical
specialists  who are  engaged  by the  sponsor to perform  the  analysis  of the
medical  image  data.  Historically,  the CAMR  systems  have been  utilized  to
determine  efficacy of the compounds being studied.  More recently,  clients are
requesting  Bio-Imaging  to provide  "real-time"  reads for  inclusion/exclusion
criteria, or safety reads. The Company believes that the rCAMR(TM) system is the
optimal  tool  for this  type of work  because  it  allows  Bio-Imaging,  at the
client's  discretion,  to  provide  the  images  to an  expert  in the  field to
facilitate the review of the images from the expert's office or home.

     The  Company  has  developed  a   proprietary   image   database   software
application,  Bio/ImageBase(R),  that  enables the  Company's  clients to submit
their medical images and related  clinical data to the FDA in a digital  format.
Using data stored on CD-ROM disks, Bio/ImageBase(R) allows clients and their FDA
medical  reviewers  to review  medical  images and related  clinical  data.  The
Company believes that  Bio/ImageBase(R)  offers the potential to decrease review
time,  resulting in faster regulatory  approvals and reduced  time-to-market for
new drugs, biologics and medical devices.

     The Company's  Bio/ImageBase(R) software has been installed at client sites
and on certain  computer  systems  at the FDA.  The  Company  has been using its
Bio/ImageBase(R)  software to submit  medical images and related data to the FDA
since  mid-1993.  In March  1996,  Bio/ImageBase(R)  was cited in the FDA's 1996
Computer-Assisted  Product License Application  Guidance Manual as an acceptable
database for submission of imaging data.

     EDUCATION, TRAINING AND CERTIFICATION

     Bio-Imaging  ETC  focuses on  Education,  Training  and  Certification  for
medical imaging equipment, facilities and staff. A program of Instrument Quality
Control  ("IQC") will provide  physicians with a method of ensuring that systems
operate to  specifications  on a continual  basis.  This  program is designed to
protect the accuracy of diagnostic  interpretation of bone density data and give
the physicians current and in-depth feedback on the status of their instruments.
In addition,  Bio-Imaging ETC will train entry-level physician and allied health
professionals in routine clinical practice.

     OTHER SERVICES

     The Company  provides  technical  consulting in the evaluation of the sites
that may participate in clinical trials.  The Company also consults with clients
regarding  regulatory  issues  involved in the design,  execution,  analysis and
submission of medical image data in clinical trials.

                                      -3-
<PAGE>

TARGET MARKETS

     The  Company's  primary  target  market  is  comprised  of  pharmaceutical,
biotechnology and medical device companies whose clinical development  pipelines
include  drugs,  biologics  or devices that are  typically  evaluated by medical
imaging   methods.   This   target   market   includes   leading   international
pharmaceutical  companies and biotechnology companies with products currently in
the clinical development pipeline.

     Bio-Imaging  focuses  its  marketing  on the  following  stages of clinical
development:

     PHASE II CLINICAL TRIALS

     Phase II clinical  trials are  generally  conducted  over six months to two
years and involve basic efficacy (effectiveness),  safety and dose-range testing
in  approximately  50 to 400  patients  suffering  from the disease or condition
under study.  Such trials help determine the best effective  dose,  confirm that
the drug works as expected and provide initial safety data.

     PHASE III CLINICAL TRIALS

     Phase III clinical  trials are generally  conducted  over one to four years
and involve  efficacy and safety  studies in broader  populations of hundreds or
thousands of patients and many  investigational  sites  (hospitals and clinics).
These are  sometimes  referred  to as  pivotal  studies  for  submission  to the
regulatory  agencies.  Generally,  Phase III  studies  are  intended  to provide
additional  information  on drug  safety  and  efficacy,  an  evaluation  of the
risk-benefit  of the drug  and  information  for the  adequate  labeling  of the
product.

     Bio-Imaging  focuses its marketing  efforts  further on clinical trials for
the following classes of drugs:

     ANTI-INFLAMMATORY THERAPEUTICS

     Anti-inflammatory  clinical  trials,  such as those  focused on  arthritis,
include  radiologic  evaluation  of the  bones  and  joints  to  determine  drug
efficacy.  The  Company  believes  that  demand  among drug  developers  for its
services will increase as new classes of  biotechnology-derived  drugs enter and
progress through the clinical development pipeline.

     CANCER THERAPEUTICS

     Many  pharmaceutical  companies are currently  developing new therapies for
the treatment of cancer. For solid tumor studies, medical imaging modalities are
used to determine  the response of treated and untreated  tumors.  These medical
images are  evaluated  by  medical  specialists  during  the course of  oncology
clinical  trials to  determine  the extent of disease  and changes in tumor size
over time.

     The  FDA's  guidelines  aimed at  accelerating  access to new drugs for the
review and approval of new cancer  therapies place greater emphasis on shrinkage
of tumors as an early

                                      -4-
<PAGE>

indicator of anti-tumor efficacy. Bio-Imaging believes that these FDA guidelines
may have a favorable impact on its business as pharmaceutical  and biotechnology
companies may have an increased need for regulatory  compliant  medical  imaging
services to conduct their oncology clinical trials.

     CENTRAL NERVOUS SYSTEM THERAPEUTICS

     Various  pharmaceutical   companies  are  currently  developing  drugs  for
treatment of diseases and  conditions  of the central  nervous  system,  most of
which are evaluated with the aid of medical imaging.  Most later-stage  clinical
trials for these serious and costly conditions involve the evaluation of medical
image data. The Company believes that its central nervous system clinical trials
business may increase as more therapies progress through the research pipeline.

     OSTEOPOROSIS

     Osteoporosis is the disease of "thinning bones" which leads to fractures in
the  elderly.  The FDA  guidance  document for  developing  treatments  for this
disease  recognized DEXA as one of the primary  efficacy and safety  measurement
tools available.  Furthermore,  all data needs to go through a quality assurance
laboratory.  This is now standard practice in all studies using DEXA instruments
whether for osteoporosis oncology or antiobesity or muscle wasting assessment.

     DIAGNOSTIC IMAGING AGENTS

     Bio-Imaging provides its services to clients developing  diagnostic imaging
agents  which are  designed  to diagnose  disease  conditions  more  quickly and
accurately in their development in order to facilitate earlier and more accurate
treatment.

     CARDIOVASCULAR THERAPEUTICS

     Various  pharmaceutical  companies are currently  developing  drugs for the
diagnosis  and treatment of  cardiovascular  diseases and  conditions  which are
evaluated with the aid of medical imaging.  The Company provides its services to
clients  developing  diagnostic  agents for the detection and treatment of these
conditions.

MARKET TRENDS

     The Company  believes that demand for its services should grow because of a
variety of favorable regulatory, technological and market trends:

     o    The FDA initiatives to streamline the regulatory submission and review
          process which are being implemented should have a beneficial impact on
          the Company.  The FDA is investing in new  information  technology and
          has begun the process of formulating and disseminating  guidelines for
          standardizing  the submission of electronic  data,  including  medical
          images.  The  Company  expects  submission  of

                                      -5-
<PAGE>

          image data to be a requirement in key therapeutic and diagnostic areas
          for evaluating the effectiveness of a drug or imaging agent.

     o    Consolidation,  restructuring  and  downsizing  in the  pharmaceutical
          industry in response  to downward  pressure on certain  pharmaceutical
          and  biotechnology  companies'  drug prices has  resulted in increased
          outsourcing of certain research and development activities. Currently,
          over $4  billion in  research  services  are  outsourced  to  contract
          clinical research  organizations.  Industry  estimates place growth of
          outsourcing  between  15% to 20% per year for at least the next  three
          years.

     o    Growth in pharmaceutical  and  biotechnology  research and development
          spending is fairly  non-cyclical.  As a result,  the Company  believes
          that outsourcing of development  activities  should continue to remain
          steady.

     o    New classes of drugs to treat  conditions  traditionally  evaluated by
          imaging are entering or progressing  through the clinical  development
          pipeline,  leading to  increased  demand for  medical  imaging-related
          services.  In addition,  digital technologies for data acquisition and
          management are rapidly penetrating the radiology community.

     o    As pharmaceutical and biotechnology  companies increasingly attempt to
          expand  the  market for new drugs by  conducting  clinical  trials and
          pursuing  regulatory  approval in multiple  countries  simultaneously,
          contract  service  organizations  with an  international  presence and
          expertise  will  continue  to  benefit.  The  Company  believes  it is
          well-positioned  to take advantage of these trends due to its U.S. and
          European operations.

     o    The Company also believes that,  because its development  services are
          specialized,  it is often able to perform these services with a higher
          level of expertise or specialization more quickly and efficiently than
          a pharmaceutical or biotechnology company could perform internally.

INTELLECTUAL PROPERTY

     Proprietary  protection  for  the  Company's   computer-imaging   programs,
processes and know-how is important to its business.  Bio-Imaging  has developed
certain technically  derived procedures and computer software  applications that
are  intended to increase the  effectiveness  and quality of its  services.  The
Company  relies  upon  trademarks,   copyrights,  trade  secrets,  know-how  and
continuing  technological  innovation  to develop and maintain  its  competitive
position.  The Company has  obtained  registered  trademark  protection  for the
Bio/ImageBase(R)  and has claimed  trademark  protection  for the  CAMR(TM)  and
rCAMR(TM). The Company holds patents for the two DEXA phantoms, titled Spine and
Variable  Composition  Phantoms,  which it sells to trial sites. The Company has
registered  its Stylized Man Design with the U.S.  Patent and Trademark  Office.
Furthermore,  Bio-Imaging requires all employees, consultants and contractors to
execute  confidential  disclosure  agreements  as a condition of  employment  or
engagement by the Company. There can be no assurance,  however, that the Company
can limit unauthorized or

                                      -6-
<PAGE>

wrongful disclosures of trade secret information. In addition, to the extent the
Company  relies on trade  secrets  and  know-how  to  maintain  its  competitive
technological  position,  there can be no assurance  that others may not develop
independently the same, similar or superior  techniques.  Although the Company's
intellectual property rights are important to the results of its operations, the
Company  believes that other factors such as  independence,  process  knowledge,
technical expertise and experience are more important,  and that, overall, these
technological capabilities offer significant benefits to its clients.

GOVERNMENT REGULATION

     The  research  and  development,  manufacture  and  marketing  of drugs and
medical  devices are subject to  stringent  regulation  by the FDA in the United
States  and  by  comparable   authorities  in  other  countries.   In  addition,
regulations  imposed  by other  federal  agencies,  as well as state  and  local
authorities,  may  impact  such  research  and  development,  manufacturing  and
marketing.

     The FDA has  established  mandatory  procedures and safety  standards which
apply to the clinical testing,  manufacturing and marketing of drugs and medical
devices.  These procedures and safety standards include, among other things, the
completion of adequate and  well-controlled  human clinical  trials to establish
the safety and efficacy of the drug or device for its recommended  conditions or
use. The Company  advises its clients in the  execution  of clinical  trials and
other drug and device developmental tasks. The Company does not administer drugs
to or utilize medical devices on patients.

     The  success  of  the  Company's   business  is  dependent  upon  continued
acceptance by the FDA and other regulatory  authorities of the data and analyses
generated by the  Company's  services in connection  with the  evaluation of the
safety and  efficacy  of new drugs and  devices.  The FDA has formal  guidelines
which encourage the use of "surrogate  measures,"  through submission of digital
image data, for evaluation of drugs to treat  life-threatening  or  debilitating
conditions. There can be no assurance, however, that the FDA or other regulatory
authorities  will  accept the data or analyses  generated  by the Company in the
future and, even assuming acceptance,  there can be no assurance that the FDA or
other regulatory  authorities will require the application of imaging techniques
to numbers of  patients  and over time  periods  substantially  similar to those
required of traditional safety and efficacy techniques.

     Changes in the FDA's  policy for the  evaluation  of  therapeutic  oncology
agents  may have a positive  impact on the time to market of such  therapeutics.
According  to the  guidelines  announced in March 1996,  approval  times for new
cancer  therapies can be shortened if evidence of tumor  shrinkage is verifiable
and  demonstrable  through the use of objective  measurement  techniques.  These
guidelines  place much  greater  reliance  on the use of  medical  image data to
demonstrate  objective  tumor  shrinkage.  In addition,  in March 1997,  the FDA
announced  new  guidelines  aimed at  accelerating  all  therapeutic  categories
through the use of  surrogate  markers  such as imaging  endpoints.  The Company
believes the FDA's  initiatives  to streamline and accelerate the submission and
review  process  of  therapeutic  agents  may  have a  favorable  impact  on the
Company's business.

                                      -7-
<PAGE>

     In October 1998, the FDA released a draft guidance for industry relating to
how medical imaging should be defined, handled and evaluated in clinical trials.
In June 2000,  the FDA released  another  draft  guidance  which  provided  more
details on the  October  1998 draft  guidance.  The  Company  believes  that the
guidance documents comports with the methodologies and processes utilized by the
Company in providing medical information management services for its clients.

     The Company believes that its ability to achieve  continued and sustainable
growth will be materially  dependent  upon,  among other factors,  the continued
stringent  enforcement  of the  comprehensive  regulatory  framework  by various
government agencies. Any significant change in these regulatory  requirements or
the enforcement  thereof,  especially  relaxation of standards,  could adversely
affect the Company's prospects.

     The current  European  market  regulation  is more  fragmented  than in the
U.S.A.,  therefore,  such  European  agencies  have a  tendency  to  follow  FDA
guidelines.

COMPETITION

     As a sign of growth in the clinical trials-related medical imaging services
business,  the Company  continues to experience an increase in competition  from
commercial  competitors and academic research centers.  Over the past two years,
several  conventional  contract  research  organizations  have either started or
acquired  divisions  to address  the need for  medical  imaging  services  as it
relates to clinical trials. As competition  increases,  Bio-Imaging will look to
provide  value-added  services and  undertake  marketing  and sales  programs to
differentiate  its services  based on its expertise  and  experience in specific
therapeutic and diagnostic areas, its technological expertise and regulatory and
clinical development  experience,  its quality performance and its international
capabilities.  Competition in the Company's  industry has resulted in additional
pressure  being  placed on price,  service  and  quality.  Although  the Company
believes  that  it is  well  positioned  against  its  competitors  due  to  its
experience  in  clinical  trials  and  regulatory   compliance  along  with  its
international presence, there can be no assurance that the Company's competitors
or clients  will not  provide or develop  services  similar or superior to those
provided by the  Company.  Any such  competition  could have a material  adverse
impact on the Company. The Company's  competitive position also depends upon its
ability to attract and retain  qualified  personnel  and  develop  and  preserve
proprietary technology, processes and know-how.

MARKETING AND SALES

     Bio-Imaging  provides  and markets its services on an  international  basis
primarily to pharmaceutical and biotechnology companies. The Company's sales and
marketing activities are directed by a Vice President, Business Development, and
supported by in-house staff and field business development personnel.

     The  Company's  selling  efforts are  focused on North  America and Western
Europe.  Sales efforts are directed from both of the Company's  headquarters  in
Pennsylvania and Leiden,  the Netherlands.  The Company's  marketing  activities
include  exhibiting at major trade shows,

                                      -8-
<PAGE>

advertising in trade journals and the sponsoring of industry  associations.  The
Company continues to evaluate appropriate  co-marketing activities and strategic
alliances,  in particular with contract research  organizations,  to augment its
own business development efforts.

SIGNIFICANT CLIENTS

     During  fiscal 2000,  two clients  accounted for  approximately  33% of the
Company's  project  revenues  encompassing  seven  projects.  No other customers
accounted for more than 10% of project revenues.  These contracts are terminable
by the  Company's  clients  at any  time  and for any  reason.  The loss of such
clients,  or a reduction  in services  provided  to such  clients,  would have a
material  adverse  effect on the  Company's  business,  financial  condition and
results of operations.

EMPLOYEES

     As of September 30, 2000,  the Company had 64  employees,  five of whom are
officers of the Company.

     Of the Company's  employees as of September 30, 2000, eight were engaged in
sales and marketing,  51 were engaged in client  related  projects and five were
engaged in administration and management.  A significant number of the Company's
management  and   professional   employees   have  prior  industry   experience.
Bio-Imaging  believes  that it has been  successful  in  attracting  skilled and
experienced personnel,  however, competition for such personnel is intensifying.
Although  all of the  Company's  employees  are covered by  confidentiality  and
non-competition agreements,  there can be no assurance that such agreements will
be enforceable.  Bio-Imaging has entered into an employment contract with one of
its  officers.  See "Item 10.  Executive  Compensation."  Bio-Imaging  considers
relations with its employees to be good.

ITEM 2.  PROPERTIES.

     The Company leases approximately 17,000 square feet of office space located
in Newtown,  Pennsylvania.  This lease  expires  January 2005 and provides for a
fixed base rent of  approximately  $26,000  per month  with an annual  inflation
increase.  The Company  also leases  approximately  4,000  square feet of office
space  in  Leiden,  the  Netherlands.  This  lease,  denominated  in  Netherland
guilders,   expires   February  14,  2003  and  provides  for  a  base  rent  of
approximately  $7,200 per month with an annual inflation increase.  In September
2000,   the  Company   entered  into  a  lease  in  Vancouver,   Washington  for
approximately  1,000 square feet for a fixed base rent of  approximately  $1,000
per month with an annual inflation  increase.  This lease is for the Bio-Imaging
ETC division and expires  September  2003. In November 2000, the Company entered
into a lease for additional space in Newtown,  Pennsylvania.  This lease expires
November 2001 and provides for  approximately  $3,000 per month in base rent and
is for  approximately  5,000 square feet of office space.  The Company  believes
that these facilities will be adequate for its needs for the foreseeable future.

                                      -9-
<PAGE>

ITEM 3.  LEGAL PROCEEDINGS.

     The Company is not a party to any material legal proceedings.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

     None.




                                     PART II

ITEM 5.  MARKET FOR THE COMPANY'S COMMON EQUITY AND RELATED STOCKHOLDER
                  MATTERS.

     From June 18, 1992  through  March 4, 1999,  the  Company's  common  stock,
$0.00025 par value,  (the "Common Stock") had been traded on the Nasdaq SmallCap
Market  under the symbol  BITI.  On March 4, 1999,  the  Company's  Common Stock
ceased to be listed on the Nasdaq  SmallCap Market and became listed on the NASD
OTC Bulletin Board under the symbol BITI.

     The following  table sets forth the high ask and low bid quotations for the
Common  Stock as reported on the Nasdaq  SmallCap  Market for the quarter  ended
December  31,  1998 and the high ask and low bid  quotations  as reported on the
NASD OTC Bulletin  Board for each of the  quarters  ended March 31, 1999 through
September 30, 2000. Such quotations reflect interdealer  prices,  without retail
mark-up, mark-down or commission and may not represent actual transactions.

                Quarter                                 Common
                Ended                                    Stock
                -----                                    -----
                                                 High             Low
                                                 ----             ---

                December 31, 1998                0.9375           0.2813
                March 31, 1999                   0.6563           0.3125
                June 30, 1999                    0.6875           0.3125
                September 30, 1999               0.5938           0.2813
                December 31, 1999                0.3438           0.2813
                March 31, 2000                   1.7813           0.2813
                June 30, 2000                    1.0625           0.5313
                September 30, 2000               1.0000           0.5000


     Since June 18,  1992,  the Common  Stock also has been listed on the Boston
Stock Exchange ("BSE") under the symbol BIT.

     The following  table sets forth the high ask and low bid quotations for the
Common  Stock as reported on the BSE for each of the  quarters  from the quarter
ended December 31, 1998

                                      -10-
<PAGE>

through September 30, 2000.

                Quarter                                 Common
                Ended                                    Stock
                -----                                    -----
                                                 High             Low
                                                 ----             ---

                December 31, 1998                0.875            0.4375
                March 31, 1999                   0.625            0.4688
                June 30, 1999                    0.875            0.5625
                September 30, 1999               0.781            0.4375
                December 31, 1999                0.5938           0.1875
                March 31, 2000                   1.6563           0.1875
                June 30, 2000                    1.7500           0.3750
                September 30, 2000               1.6250           0.2500


     As of November 30, 2000, the approximate number of holders of record of the
Common Stock was 117 and the  approximate  number of  beneficial  holders of the
Common Stock was 1389.

     The Company has 416,667 shares of Series A Preferred  Stock (the "Preferred
Stock")  outstanding.  The Preferred  Stock provides for (i) voting rights on an
as-converted to Common Stock basis, with standard protective provisions;  (ii) a
liquidation  preference of $1.20 per share; (iii)  anti-dilution  protection and
price protection  provisions;  (iv) cumulative dividends of $0.096 per share per
annum,  payable out of funds legally  available for the payment of dividends and
only upon declaration of dividends by the Board of Directors of the Company; and
(v) registration rights with respect to the shares of Common Stock issuable upon
conversion  of the  Preferred  Stock.  Dividends  are  payable in cash or in the
Company's Common Stock at the Company's discretion.

     The Company has neither  paid nor  declared  dividends  on its Common Stock
since its  inception  and does not plan to pay  dividends on its Common Stock in
the foreseeable  future. The Company expects that any earnings which the Company
may realize and which are not paid as dividends  to holders of  Preferred  Stock
will be retained to finance the growth of the Company.

ITEM 6.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS.

OVERVIEW

     Bio-Imaging is a pharmaceutical  contract service  organization,  providing
services  that support the product  development  process of the  pharmaceutical,
biotechnology  and  medical  device  industries.   The  Company  specializes  in
assisting  its  clients  in the  design and  management

                                      -11-
<PAGE>

of the  medical-imaging  component of clinical  trials for all modalities  which
consist of CT, MRI, x-rays, DEXA, PET SPECT and ultrasound. The Company provides
services  which include the  processing  and analysis of medical  images and the
data-basing and regulatory  submission of medical images,  quantitative data and
text. A new division of the Company,  Bio-Imaging  ETC, will focus on Education,
Training and Certification for medical imaging equipment, facilities and staff.

     The Company's sales cycle (the period from the  presentation by the Company
to a  potential  client to the  engagement  of the  Company  by such  client) is
generally twelve months.  In addition,  the contracts under which the Company is
engaged to perform services  typically cover a period of 12 to 36 months and the
volume and type of services  performed by the Company  generally vary during the
course of a project.  In an effort to expand its client base,  obtain additional
contracts and generate additional  revenues,  beginning in the fiscal year ended
September 30, 1998, the Company increased its sales and marketing  efforts.  The
Company believes that these efforts are beginning to yield positive results.  No
assurance  can be made that the  Company's  project  revenues  will  increase to
levels  required to achieve  profitability.  Although the Company  experienced a
loss for fiscal 2000, the Company's  project  revenues  increased as compared to
fiscal 1999.  Project  revenues were generated from 42 clients  encompassing  91
projects for fiscal 2000 as compared to 34 clients  encompassing 67 projects for
fiscal  1999.  This  represents  an  increase  of 23.5% in clients  and 35.8% in
projects   for  fiscal  2000  as  compared  to  fiscal   1999.   The   Company's
contracted/committed  backlog was approximately  $17,518,000 as of September 30,
2000 as compared to approximately  $7,054,000 as of September 30, 1999, a 148.3%
increase.  Contracted/committed backlog is the amount of revenue that remains to
be earned on signed and  agreed to  contracts.  Such  contracts  are  subject to
termination by the Company or its clients at any time or for any reason.

     The Company  believes  that demand for its services and  technologies  will
grow  during  the  long-term  as  the  use  of  digital  technologies  for  data
acquisition  and  management  increases in the  radiology  and drug  development
communities.  The  Company  also  believes  that there is a growing  recognition
within  the  bio-pharmaceutical  industry  regarding  the use of an  independent
centralized core laboratory for analysis of medical imaging data that is derived
from clinical trials and the rigorous  regulatory  requirements  relating to the
submission  of this  data.  In  addition,  the FDA is  gaining  experience  with
electronic  submissions and is continuing to develop guidelines for computerized
submission of data, including medical images. Furthermore,  the increased use of
digital medical images in clinical trials, especially for important drug classes
such as anti-inflammatory,  neurologic and oncologic therapeutics and diagnostic
image agents, generate large amounts of image data that will require processing,
analysis,  data  management and  submission  services.  Due to several  factors,
including,  without  limitation,  an  increase in  competition,  there can be no
assurance  that demand for the Company's  services and  technologies  will grow,
sustain growth,  or that additional  revenue  generating  opportunities  will be
realized by the Company.

     Certain  matters  discussed  in  this  Form  10-KSB  are   "forward-looking
statements" intended to qualify for the safe harbors from liability  established
by the Private  Securities  Litigation  Reform Act of 1995. In  particular,  the
Company's  statements  regarding  the  demand  for the  Company's  services  and
technologies,  growing  recognition for the use of independent

                                      -12-
<PAGE>

centralized core laboratories, trends toward the outsourcing of imaging services
in clinical trials,  realized return from the Company's  marketing efforts,  the
favorable  impact of the FDA's  initiatives  to streamline  and  accelerate  its
review process and increased use of digital  medical  images in clinical  trials
are examples of such forward-looking  statements. The forward-looking statements
include risks and  uncertainties,  including,  but not limited to, the timing of
revenues  due to the  variability  in size,  scope  and  duration  of  projects,
regulatory   delays,   clinical  study  results  which  lead  to  reductions  or
cancellations  of  projects,  and  other  factors,  including  general  economic
conditions and regulatory  developments,  not within the Company's control.  The
factors  discussed  herein  and  expressed  from  time to time in the  Company's
filings with the Securities and Exchange  Commission  could cause actual results
and  developments to be materially  different from those expressed in or implied
by such statements.  The forward-looking statements are made only as of the date
of this filing and the Company  undertakes no obligation to publicly update such
forward-looking statements to reflect subsequent events or circumstances.

RESULTS OF OPERATIONS

     Fiscal Years Ended September 30, 2000 and 1999
     ----------------------------------------------

     Project  revenues  for  fiscal  2000 and  fiscal  1999  were  approximately
$5,772,000  and   $4,349,000,   respectively,   an  increase  of   approximately
$1,423,000,  or 32.7%. The increase in project revenues is primarily a result of
the  increase  in the number of clients and  projects  for which the Company was
engaged to perform services.  This increase resulted primarily from the increase
in the Company's  sales and marketing  efforts over the past year. The Company's
scope of work in both periods included medical imaging core laboratory  services
and image-based information management services.

     Cost of  revenues  for  fiscal  2000 and  fiscal  1999  were  comprised  of
professional salaries and benefits and allocated overhead. Cost of revenues were
approximately $3,619,000 for fiscal 2000 and approximately $2,661,000 for fiscal
1999,  an  increase  of  approximately  $958,000,  or 36.0%.  This  increase  is
attributable  to an increase in staffing  levels  required  for project  related
tasks  for  fiscal  2000  and in  anticipation  of work to be  performed  on new
contracts as compared to fiscal 1999.

     The difference  between project revenues and cost of revenues may fluctuate
as a percentage of project  revenues  based on the  utilization of staff and the
mix of services  provided by the  Company to its clients  during the  comparable
periods. The decrease in this percentage in fiscal 2000 from fiscal 1999 of 1.5%
resulted from a lower increase in project revenues as compared to higher project
related costs which was primarily  attributable  to the Company  increasing  its
staffing  levels  in  fiscal  2000 to  support  its  existing  contracts  and in
anticipation of future business.

     General  and  administrative  expenses  for  fiscal  2000 and  fiscal  1999
consisted  primarily of  professional  salaries and benefits,  depreciation  and
amortization,  professional and consulting  services,  office rent and corporate
insurance. General and administrative expenses were

                                      -13-
<PAGE>

approximately $1,276,000 for fiscal 2000 and approximately $1,428,000 for fiscal
1999. The decrease for fiscal 2000, of approximately  $152,000,  or 10.6%,  from
fiscal 1999, is primarily  attributable to less professional services associated
with general corporate matters.

     Sales and marketing expenses for fiscal 2000 and fiscal 1999 were comprised
of direct  sales and  marketing  costs,  professional  salaries and benefits and
allocated overhead.  Sales and marketing expenses were approximately  $1,478,000
for fiscal 2000 and  approximately  $974,000 for fiscal  1999.  The increase for
fiscal 2000, of approximately  $504,000,  or 51.7%,  from fiscal 1999,  resulted
from an increase in the Company's expenses  associated with increased  marketing
efforts,  conferences  attendance  and the  appointment  of a Vice  President of
Business Development in October 1999.

     Total costs and  expenses  during  fiscal  2000 and fiscal  1999  consisted
primarily of cost of revenues, general and administrative expenses and sales and
marketing.  The  Company's  cost and expenses were  approximately  $6,373,000 in
fiscal 2000 and  $5,063,000  in fiscal  1999.  Such  increase  of  approximately
$1,310,000, or 25.9%, is due primarily to an increase in the Company's sales and
marketing efforts along with an increase in staffing levels required for project
related  tasks offset by a decrease in  professional  services  associated  with
general corporate matters.

     Net interest expense of approximately  $92,000 during fiscal 2000, resulted
from interest  expense  incurred in the  assignment of accounts  receivable  and
interest  expense incurred in connection with long-term debt and equipment lease
obligations offset in part by interest earned on cash balances.  The Company had
interest  income in fiscal 1999 due to higher cash  balances  maintained  during
fiscal 1999 period  offset in part by interest  expense  incurred in  connection
with equipment lease obligations.  Net interest income was approximately  $9,000
in fiscal 1999.

     The Company's net loss for fiscal 2000 was approximately $692,000 while the
Company had net loss of  approximately  $705,000 for fiscal 1999.  The Company's
net  loss for  fiscal  2000  and  fiscal  1999  was  attributable  primarily  to
insufficient project revenue to support the infrastructure of the Company.

LIQUIDITY AND CAPITAL RESOURCES

     At  September  30,  2000,  the  Company  had cash and cash  equivalents  of
approximately  $491,000.  The working  capital deficit at September 30, 2000 was
approximately $56,000.

     Net cash provided by operating activities for fiscal 2000 was approximately
$602,000.  This is primarily  due to the increase in deferred  revenue in fiscal
2000  of   approximately   $1,166,000  and  adjustments  for   depreciation  and
amortization, offset in part by the net loss for fiscal 2000 and the increase in
accounts receivable.

     For the year ended September 30, 2000, the Company  invested  approximately
$341,000  in  capital  and  leasehold   improvements.   The  Company   currently
anticipates that capital  expenditures for the next fiscal year will approximate
$300,000.  These  expenditures  represent  additional  upgrades in the Company's
networking,  data storage and core  laboratory  capabilities

                                      -14-
<PAGE>

along with similar capital requirements for its European operations.

     In December 1999, the Company paid to the holders of its Preferred Stock an
aggregate  amount  of  $20,000,  which  amount  represented  accrued  cumulative
dividends  for the period from July 1, 1999 through and  including  December 31,
1999. In June 2000,  the Company paid to the holders of its  Preferred  Stock an
aggregate  amount  of  $20,000,  which  amount  represented  accrued  cumulative
dividends  for the period from  January 1, 2000 through and  including  June 30,
2000.

     In December 1999, the Company entered into an accounts receivable financing
agreement  with  Silicon  Valley Bank  ("Silicon  Valley  Bank" or the  "Bank"),
whereby,  the Company may assign up to $500,000 of eligible accounts  receivable
to the Bank. In March 2000, the Bank increased the eligible accounts  receivable
to  $1,000,000.  The Bank,  in turn,  would advance the Company up to 80% of the
assigned accounts receivable amount. Upon collection by the Bank, the balance of
the  assigned  accounts  receivable  would be remitted to the Company net of the
Bank's  finance  charges and  administration  fees.  Although  the  agreement is
contractually  renewable each year, it is cancelable by the Bank at any time. In
fiscal  2000,  the  Company  assigned   accounts   receivable  of  approximately
$1,698,000  to the Bank.  At  September  30,  2000,  the  Company had repaid its
borrowings and had a $0 balance with the Bank. A 1.00% administrative fee of the
face  amount of the  assigned  receivable  was  charged by the Bank along with a
1.75% finance charge per month of the average daily account balance outstanding.

     In August 1999,  the Company  entered into an agreement with the Bank for a
revolving line of credit of up to $500,000 collaterized by the Company's assets.
Interest  is  payable  at 1.50% over the  bank's  prime  rate of  interest.  The
agreement  requires the Company,  among other things, to maintain minimum levels
of tangible net worth and certain minimum financial ratios. In October 1999, the
Bank notified the Company that it would not make any advances under the existing
line of credit until the Company provides  sufficient  evidence  satisfactory to
the Bank of an improvement in the Company's  operating,  financial and liquidity
position.  At such  time,  the Bank may  consider  permitting  further  advances
pursuant to the loan agreement.

     Also, in December 1999,  February 2000 and April 2000, the Company  entered
into equipment lease obligations  consisting of monthly  installments of $4,961,
$3,258 and $1,878, respectively, which includes interest rates of 10.52%, 10.53%
and 13.75%,  through November 2002,  January 2003 and February 2003. The debt is
collateralized by the related equipment.

     The Company  anticipates that its cash and cash equivalents as at September
30, 2000, together with anticipated cash from operations,  will be sufficient to
fund current  working  capital needs and capital  requirements  for at least the
next twelve  months.  There can be no  assurance,  however,  that the  Company's
operating  results  will  achieve  profitability  on an annual basis in the near
future.  The  continuation  of  operating  losses  and  together  with the risks
associated  with  the  Company's  ability  to gain  new  client  contracts,  the
variability of the timing of milestone payments on existing client contracts and
other  changes in the Company's  operating  assets and  liabilities,  may have a
material  adverse  affect  on the  Company's  future  liquidity.  In  connection
therewith,  the Company may need to raise additional  capital in the foreseeable
future from equity or debt sources in order to implement its business,  sales or
marketing  plans,  take advantage of

                                      -15-
<PAGE>

unanticipated  opportunities  (such as more  rapid  expansion,  acquisitions  of
complementary  businesses  or the  development  of new  services),  to  react to
unforeseen  difficulties  (such as the decrease in the demand for the  Company's
services  or the  timing of  revenues  due to a variety  of  factors  previously
discussed) or to otherwise respond to unanticipated competitive pressures. There
can be no assurance that additional  financing will be available,  if at all, on
terms acceptable to the Company.

     The Company's 2001 operating plans contain  assumptions  regarding  revenue
and  expenses.  The  achievement  of the operating  plan depends  heavily on the
timing of work performed by the Company on existing  projects and the ability of
the Company to gain and perform work on new projects.  Project cancellation,  or
delays in the timing of work  performed  by the Company on existing  projects or
the inability of the Company to gain and perform work on new projects could have
an adverse  impact on the Company's  ability to execute its  operating  plan and
maintain  adequate  cash  flow.  In the  event  actual  results  do not meet the
operating plan, the Company's  management  believes it could execute contingency
plans to mitigate such effects. Such plans include additional financing,  to the
extent available,  through the accounts receivable financing agreement discussed
above.  In addition,  in November 2000, the members of the Board of Directors of
the Company, in their individual capacities, committed up to an aggregate amount
totaling $100,000 in the form of a short-term loan,  through October 1, 2001, if
needed by the Company. Considering the cash on hand and based on the achievement
of the  operating  plan and  management's  actions  taken  to  date,  management
believes it has the ability to continue to generate  sufficient  cash to satisfy
its  operating  requirements  in the  normal  course of  business.  However,  no
assurance can be given that sufficient  cash will be generated from  operations.
The  Company's  cash  balance  was  approximately  $491,000  and  $616,000 as of
September 30, 2000 and November 30, 2000, respectively.

NEW ACCOUNTING REQUIREMENTS

     In June 1998, the Financial Accounting Standards Board issued SFAS No. 133,
"Accounting  for Derivative  Instruments  and Hedging  Activities" as amended by
SFAS No. 137,  "Accounting for Derivative  Instruments and Hedging  Activities -
Deferral of the Effective  Date of FASB Statement No. 133 - an Amendment of FASB
Statement  No.  133"  and SFAS  No.  138,  "Accounting  for  Certain  Derivative
Instruments and Certain Hedging  Activities - an Amendment of FASB Statement No.
133." Adoption of SFAS No. 133, as amended,  is required for fiscal  quarters of
fiscal years  beginning  after June 15, 2000.  The Company does not believe that
the new  standard  will have a  material  impact on the  Company's  consolidated
financial  statements.  In December 1999, the Securities and Exchange Commission
issued Staff  Accounting  Bulletin  No. 101 (SAB 101),  Revenue  Recognition  in
Financial  Statements.  SAB 101 provides guidance for revenue  recognition under
certain circumstances. The accounting and disclosures prescribed by SAB 101 will
be  effective  for the  fourth  quarter  of fiscal  year  2001.  The  Company is
currently  evaluating  the  impact the  application  of SAB 101 will have on its
financial position or results of operations.

                                      -16-
<PAGE>

EXISTING CONTRACTS

     During fiscal 2000,  the Company  signed  approximately  $12,819,000 in new
project contracts as compared to approximately  $6,564,000 in fiscal 1999. As of
September 30, 2000, the Company had entered into  agreements  with 34 companies,
encompassing  72  projects,  to  provide  services  in the  aggregate  amount of
approximately  $25,077,000  through  December 2004, of which services  valued at
approximately  $17,518,000 remain to be completed. Such contracts are subject to
termination  by the  Company or its  clients at any time or for any  reason.  In
addition,  client's  clinical trials or other projects are subject to timing and
scope changes.  Therefore, future revenue generated by the Company may not equal
initial contract values.

EUROPEAN MONETARY UNION

     On January 1, 1999,  eleven of the fifteen member countries of the European
Union set fixed  conversion  rates between their existing legacy  currencies and
the euro. As such, these  participating  countries have agreed to adopt the euro
as their common legal currency.  The eleven  participating  countries will issue
sovereign debt exclusively in euro and will redenominate  outstanding  sovereign
debt.  The legal  currencies  will  continue to be used as legal tender  through
January 1, 2002, at which point the legacy  currencies will be canceled and euro
bills  and  coins  will be  used  for  cash  transactions  in the  participating
countries.  There can be no assurance,  however,  that such euro conversion will
not adversely affect the Company's  business,  financial  condition,  results of
operations or cash flows.

ITEM 7.  FINANCIAL STATEMENTS.

     The financial  statements  required to be filed pursuant to this Item 7 are
included  in  this  Annual  Report  on  Form  10-KSB.  A list  of the  financial
statements filed herewith is found at "Item 13.  Exhibits,  List, and Reports on
Form 8-K."

ITEM 8.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
                  FINANCIAL DISCLOSURE.

     None.




                                      -17-
<PAGE>

                                    PART III

ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE
                 WITH SECTION 16(A) OF THE EXCHANGE ACT.

     The information relating to the Company's directors,  nominees for election
as directors and executive  officers under the headings  "Election of Directors"
and "Executive  Officers" in the Company's  definitive  proxy  statement for the
2001 Annual Meeting of Stockholders is incorporated  herein by reference to such
proxy statement.

ITEM 10. EXECUTIVE COMPENSATION.

     The discussion under the heading "Executive  Compensation" in the Company's
definitive  proxy  statement  for the 2001  Annual  Meeting of  Stockholders  is
incorporated herein by reference to such proxy statement.

ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.

     The discussion under the heading "Security  Ownership of Certain Beneficial
Owners and Management" in the Company's  definitive proxy statement for the 2001
Annual Meeting of Stockholders is incorporated herein by reference to such proxy
statement.

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

     The  discussion  under  the  heading  "Certain  Relationships  and  Related
Transactions"  in the Company's  definitive  proxy statement for the 2001 Annual
Meeting  of  Stockholders  is  incorporated  herein by  reference  to such proxy
statement.

ITEM 13. EXHIBITS, LIST, AND REPORTS ON FORM 8-K.

     (a) (1)    Financial Statements.

         Reference is made to the Index to Financial Statements on Page F-1.

     (a) (2)    Financial Statement Schedules.

         None.

     (a) (3)    Exhibits.

         Reference is made to the Index to Exhibits on Page 21.

     (b)        Reports on Form 8-K.

         None.


                                      -18-
<PAGE>

                                   SIGNATURES

     Pursuant  to the  requirements  of  Section  13 or 15(d) of the  Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed on
its  behalf  by the  undersigned,  thereunto  duly  authorized  this 20th day of
December, 2000.

                                       BIO-IMAGING TECHNOLOGIES, INC.



                                       By: /s/ Mark L. Weinstein
                                          --------------------------------------
                                          Mark L. Weinstein, President and Chief
                                          Executive Officer




                                      -19-
<PAGE>

     Pursuant to the  requirements of the Securities  Exchange Act of 1934, this
report  has  been  signed  below  by the  following  persons  on  behalf  of the
Registrant and in the capacities and on the dates indicated.

<TABLE>
<CAPTION>

SIGNATURE                           TITLE                                     DATE
---------                           -----                                     ----

<S>                                 <C>                                       <C>
/s/Mark L. Weinstein                President and Chief                       December 20, 2000
-------------------------------     Executive Officer and Director
Mark L. Weinstein                   (principal executive and financial
                                    officer)

/s/Maria T. Kraus                   Controller                                December 20, 2000
-------------------------------     (principal accounting officer)
Maria T. Kraus

/s/Jeffrey H. Berg, Ph.D            Director                                  December 20, 2000
-------------------------------
Jeffrey H. Berg, Ph.D.


/s/Marc Berger                      Director                                  December 20, 2000
-------------------------------
Marc Berger

/s/David E. Nowicki, D.M.D.         Director                                  December 20, 2000
-------------------------------
David E. Nowicki, D.M.D.


/s/Allen Rubenstein, M.D.           Director                                  December 20, 2000
-------------------------------
Allen Rubenstein, M.D.


/s/David Stack                      Director                                  December 20, 2000
-------------------------------
David Stack

/s/James A. Taylor, Ph.D.           Director                                  December 20, 2000
-------------------------------
James A. Taylor, Ph.D.

</TABLE>


                                      -20-
<PAGE>

                                  EXHIBIT INDEX

Exhibit
  No.                                   Description of Exhibit
-------                                 ----------------------
3.1            Restated    Certificate   of  Incorporation  of    the   Company.
               (Incorporated  by  reference  to  Exhibit  3.1 to  the  Company's
               Registration  Statement on Form S-1 (File Number  33-47471) which
               became effective on June 18, 1992.)  (Amendments  incorporated by
               reference to Exhibit 3.1 to the  Company's  Annual Report on Form
               10-K for the year ended  September 30, 1993 and to Exhibit 3.1 to
               the  Company's  Quarterly  Report on Form  10-QSB for the quarter
               ended March 31, 1995.)

3.2            By-Laws of the  Company.  (Incorporated  by  reference to Exhibit
               3.2 to the  Company's  Registration  Statement  on Form S-1 (File
               Number 33-47471) which became effective on June 18, 1992.)

4.1            Specimen Common Stock Certificate. (Incorporated  by reference to
               Exhibit 4.1 to the Company's  Registration  Statement on Form S-1
               (File Number  33-47471) which became effective on June 18, 1992.)

4.2            Registration Agreement dated October 13, 1994 between the Company
               and Corning  Pharmaceuticals  Services  Inc.,  now Covance,  Inc.
               ("Covance").  (Incorporated  by  reference  to Exhibit 4.1 to the
               Company's Current Report on Form 8-K dated October 13, 1994.)

4.3            Purchase  Agreement  for  Units of  Convertible  Preferred  Stock
               and Warrants dated December 8, 1995 between  Investment  Partners
               of  America,  L.P.,  as  Purchaser,  and the  Company,  including
               material  exhibits  (including the Certificate of Designation for
               the Convertible  Preferred Stock).  (Incorporated by reference to
               Exhibit  4.1 to the  Company's  Current  Report on Form 8-K dated
               December 22, 1995.)

10.1           Lease   between  Mountain  View   Office Park  and  the  Company.
               (Incorporated  by reference to (i) Exhibit 10.1 to the  Company's
               Registration  Statement on Form S-1 (File Number  33-47471) which
               became  effective  on June 18,  1992,  (ii)  Exhibit  10.1 to the
               Company's  Annual  Report on Form 10-K for the fiscal  year ended
               September 30, 1992,  (iii)  Exhibit 10.1 to the Company's  Annual
               Report on Form  10-KSB for the fiscal  year ended  September  30,
               1994,  (iv) Exhibit 10.1 to the  Company's  Annual Report on Form
               10-KSB for the fiscal year ended  September 30, 1995), as amended
               effective September 5, 1996 (Incorporated by Reference to Exhibit
               10.1 to the Company's Annual Report on Form 10-KSB for the fiscal
               year ended September 30, 1996) (v) as amended  effective June 22,
               1998  (Incorporated by Reference to Exhibit 10.1 to the Company's
               Annual Report on Form 10-KSB for the fiscal year ended  September
               30, 1998).


                                      -21-
<PAGE>

Exhibit
   No.                                  Description of Exhibit
-------                                 ----------------------
10.2*          1991  Stock Option  Plan.  (Incorporated  by reference to Exhibit
               10.6 to the  Company's  Registration  Statement on Form S-1 (File
               Number  33-47471) which became effective on June 18, 1992.)

10.3*          401(k)  Plan.  (Incorporated  by reference to Exhibit 10.7 to the
               Company's   Registration  Statement  on  Form  S-1  (File  Number
               33-47471) which became effective on June 18, 1992.)

10.4           Form of Employee's Invention Assignment, Confidential Information
               and  Non-Competition  Agreement.  (Incorporated  by  reference to
               Exhibit 10.9 to the Company's  Annual Report on Form 10-K for the
               fiscal  year ended  September  30,  1992.)

10.5           Stock  Purchase  Agreement  dated  October 13, 1994  between  the
               Company and Covance.  (Incorporated  by reference to Exhibit 10.2
               to the  Company's  Current  Report on Form 8-K dated  October 13,
               1994.)

10.6*          Employment   Agreement   including   Invention   Assignment   and
               Confidential Information Agreement dated January 20, 2000, by and
               between  the  Company  and  Mark  L.  Weinstein. (Incorporated by
               reference to  Exhibit 10.1 to  the Company's Quarterly Report  on
               Form 10-QSB for the Quarter ended December 31, 1999.)

10.7           Purchase Agreement for Units of Convertible  Preferred  Stock and
               Warrants  dated December 8, 1995 between  Investment  Partners of
               America,  L.P., as Purchaser and the Company,  including material
               exhibits.  (Incorporated  by  reference  to  Exhibit  4.1  to the
               Company's Current Report on Form 8-K dated December 22, 1995.)

10.8           Office  Space  Lease dated  September  22, 1999  between  Yardley
               Road Associates, L.P. and the Company. (Incorporated by reference
               to Exhibit 10.9 to the Company's Annual Report on Form 10-KSB for
               the  fiscal  year  ended  September  30,  1999).

10.9           Revolving Promissory  Note and Loan and Security  Agreement dated
               August 10, 1999  between  Silicon  Valley  Bank and the  Company.
               (Incorporated  by  reference  to Exhibit  10.10 to the  Company's
               Annual Report on Form 10-KSB for the fiscal year ended  September
               30, 1999).

10.10          Accounts Receivable  Purchase  Agreement dated December  23, 1999
               between  Silicon  Valley Bank and the Company.  (Incorporated  by
               reference to Exhibit 10.11 to the Company's Annual Report on Form
               10-KSB for the fiscal  year ended  September  30,  1999).

10.11+         Office  Space  Lease dated  September  11,  2000  between  Angelo
               Investment Company and the Company.



                                      -22-
<PAGE>

Exhibit
   No.                                  Description of Exhibit
-------                                 ----------------------
21             List  of Subsidiaries of Registrant.  (Incorporated  by reference
               to Exhibit 21.1 to the Company's Annual Report on Form 10-KSB for
               the fiscal  year ended  September  30,  1997.)

23.1+          Consent of Arthur  Andersen  LLP.

27+            Financial  Data Schedule for the year ended September 30, 2000.

------------------------
*        A management  contract or compensatory plan or arrangement  required to
         be filed as an exhibit pursuant to Item 13(a) of Form 10-KSB.

+        Included herewith.

                  (b)               Financial Statement Schedules.

                                    None.



                                      -23-
<PAGE>

                                 Bio-Imaging Technologies, Inc. and Subsidiaries


                                                                        CONTENTS

--------------------------------------------------------------------------------

Report of Independent Public Accountants                                   F-2

Consolidated Financial Statements:

Balance Sheets                                                             F-3
Statements of Operations                                                   F-4
Statements of Stockholders' Equity                                         F-5
Statements of Cash Flows                                                   F-6
Notes to Consolidated Financial Statements                                 F-7




                                      F-1
<PAGE>

                    REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To the Board of Directors and Stockholders of
Bio-Imaging Technologies, Inc.:


We have audited the  accompanying  consolidated  balance  sheets of  Bio-Imaging
Technologies, Inc. (a Delaware corporation) and subsidiaries as of September 30,
2000  and  1999,  and  the  related   consolidated   statements  of  operations,
stockholders'  equity and cash flows for the years then ended.  These  financial
statements   are  the   responsibility   of  the   Company's   management.   Our
responsibility  is to express an opinion on these financial  statements based on
our audits.

We conducted our audits in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the audit
to obtain reasonable  assurance about whether the financial  statements are free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting  the amounts and  disclosures in the financial  statements.  An audit
also includes assessing the accounting principles used and significant estimates
made by  management,  as well as  evaluating  the  overall  financial  statement
presentation.  We believe  that our audits  provide a  reasonable  basis for our
opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all material respects, the financial position of Bio-Imaging Technologies,  Inc.
and  subsidiaries  as of September  30, 2000 and 1999,  and the results of their
operations  and their cash flows for the years  then  ended in  conformity  with
accounting principles generally accepted in the United States.

                                         ARTHUR ANDERSEN LLP

Princeton, New Jersey
December 18, 2000



                                      F-2
<PAGE>


                                 Bio-Imaging Technologies, Inc. and Subsidiaries

CONSOLIDATED BALANCE SHEETS

SEPTEMBER 30,                                     2000                   1999
--------------------------------------------------------------------------------

ASSETS

CURRENT ASSETS:
Cash and cash equivalents                     $   491,048            $  412,903
Accounts receivable, net of allowance
  for doubtful accounts of $65,000
  in 2000 and 1999                              1,627,457             1,237,746
Prepaid expenses and other current assets         234,201               138,127
--------------------------------------------------------------------------------
TOTAL CURRENT ASSETS                            2,352,706             1,788,776
Property and equipment, net                     1,292,344             1,180,254
Other assets                                      261,762               179,624
--------------------------------------------------------------------------------
TOTAL ASSETS                                  $ 3,906,812            $3,148,654
================================================================================

LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:
Accounts payable                              $   321,113            $  134,685
Accrued expenses and other current
  liabilities                                     229,354               254,565
Deferred revenue                                1,707,681               541,933
Current maturities of long-term debt              150,796                69,800
--------------------------------------------------------------------------------
TOTAL CURRENT LIABILITIES                       2,408,944             1,000,983
Long-term debt                                    164,139                81,511
--------------------------------------------------------------------------------
TOTAL LIABILITIES                               2,573,083             1,082,494
--------------------------------------------------------------------------------
STOCKHOLDERS' EQUITY:
Convertible cumulative preferred stock
  - $.00025 par value; authorized 3,000,000
  shares, issued and outstanding 416,667
  shares ($500,000 liquidation preference)            104                   104
Common stock - $.00025 par value; authorized
  18,000,000 shares, issued and outstanding
  7,773,878 shares in 2000 and 1999                 1,944                 1,944
Additional paid-in capital                      9,231,497             9,231,497
Accumulated deficit                            (7,899,816)           (7,167,385)
--------------------------------------------------------------------------------
STOCKHOLDERS' EQUITY                            1,333,729             2,066,160
--------------------------------------------------------------------------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY     $3,906,812            $3,148,654
================================================================================



      THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE BALANCE SHEETS.


                                      F-3
<PAGE>

                                 Bio-Imaging Technologies, Inc. and Subsidiaries


CONSOLIDATED STATEMENTS OF OPERATIONS

YEAR ENDED SEPTEMBER 30,                              2000              1999
--------------------------------------------------------------------------------

Project revenues                                  $ 5,772,443     $ 4,349,079
--------------------------------------------------------------------------------

Cost and expenses:

   Cost of revenues                                 3,619,343       2,660,659

   General and administrative expenses              1,275,669       1,428,375

   Sales and marketing expenses                     1,477,841         974,264
--------------------------------------------------------------------------------
       Total cost and expenses                      6,372,853       5,063,298
--------------------------------------------------------------------------------

Loss from operations                                 (600,410)       (714,219)

Interest (expense) income, net                        (92,021)          8,760
--------------------------------------------------------------------------------

Net loss                                             (692,431)       (705,459)

Dividends on preferred stock                           40,000          40,000
--------------------------------------------------------------------------------

Net loss applicable to common stock               $  (732,431)    $  (745,459)
================================================================================

Basic and diluted loss per common share           $     (0.09)    $     (0.10)
================================================================================

Weighted average number of common shares and
dilutive common equivalent shares                   7,773,878       7,773,878
================================================================================




        THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE STATEMENTS.



                                      F-4
<PAGE>


                                 Bio-Imaging Technologies, Inc. and Subsidiaries


CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

<TABLE>
<CAPTION>
                                                                               Additional
                                  Preferred   Stock       Common Stock           Paid-in       Accumulated      Stockholders'
                                   Shares    Amount     Shares       Amount      Capital         Deficit           Equity
-----------------------------------------------------------------------------------------------------------------------------

<S>                                 <C>       <C>       <C>         <C>        <C>           <C>
Balance at
September 30, 1998                  416,667   $ 104     7,773,878   $ 1,944    $ 9,231,497   $ (6,421,926)      $ 2,811,619

Dividends on preferred stock              -       -             -         -              -        (40,000)          (40,000)

Net loss                                  -       -             -         -              -       (705,459)         (705,459)

-----------------------------------------------------------------------------------------------------------------------------

Balance at
September 30, 1999                  416,667     104     7,773,878     1,944      9,231,497     (7,167,385)        2,066,160

Dividends on preferred stock              -       -             -         -              -        (40,000)          (40,000)

Net loss                                  -       -             -         -              -       (692,431)         (692,431)

-----------------------------------------------------------------------------------------------------------------------------

Balance at
September 30, 2000                  416,667   $ 104     7,773,878   $ 1,944    $ 9,231,497   $ (7,899,816)      $ 1,333,729
=============================================================================================================================

</TABLE>


        THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE STATEMENTS.


                                      F-5
<PAGE>

                                 Bio-Imaging Technologies, Inc. and Subsidiaries

CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>

YEAR ENDED SEPTEMBER 30,                                                                     2000                     1999
--------------------------------------------------------------------------------------------------------------------------------

<S>                                                                                       <C>                     <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss                                                                                  $(692,431)              $(705,459)
Adjustments to reconcile net loss to net cash
provided by (used in) operating activities:
  Depreciation and amortization                                                             535,353                 551,038
  Changes in operating assets and liabilities, net of assets and
   liabilities acquired in a business combination:
    Increase in accounts receivable                                                        (389,711)               (611,370)
    Increase in prepaid expenses and other current assets                                   (96,074)                (53,380)
    (Increase) decrease in other assets                                                     (82,138)                 20,611
    Increase (decrease) in accounts payable                                                 186,428                  (7,386)
    Decrease in accrued expenses and other current liabilities                              (25,211)                (71,498)
    Increase (decrease) in deferred revenue                                               1,165,748                (103,137)
--------------------------------------------------------------------------------------------------------------------------------
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES                                         601,964                (980,581)
--------------------------------------------------------------------------------------------------------------------------------

CASH FLOWS FROM INVESTING ACTIVITIES:
  Purchases of property and equipment                                                      (340,579)               (165,858)
  Cash paid for business acquisition                                                              -                  (2,535)
--------------------------------------------------------------------------------------------------------------------------------
NET CASH USED IN INVESTING ACTIVITIES                                                      (340,579)               (168,393)
--------------------------------------------------------------------------------------------------------------------------------

CASH FLOWS FROM FINANCING ACTIVITIES:
  Payments under equipment lease obligations and notes payable                           (1,501,971)                (71,377)
  Dividends paid to preferred stockholders                                                  (40,000)                (40,000)
  Proceeds from notes payable                                                             1,358,731                 145,924
--------------------------------------------------------------------------------------------------------------------------------
NET CASH (USED IN) PROVIDED BY FINANCING ACTIVITIES                                        (183,240)                 34,547
--------------------------------------------------------------------------------------------------------------------------------

Net decrease in cash and cash equivalents                                                    78,145              (1,114,427)
Cash and cash equivalents at beginning of year                                              412,903               1,527,330
--------------------------------------------------------------------------------------------------------------------------------
Cash and cash equivalents at end of year                                                 $  491,048              $  412,903
================================================================================================================================

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
  Cash paid during the year for interest                                                  $  93,721              $   12,412
================================================================================================================================

SUPPLEMENTAL SCHEDULE OF NONCASH INVESTING
AND FINANCING ACTIVITIES:
  Equipment purchased under capital lease obligations                                     $ 306,864              $        -
================================================================================================================================
</TABLE>

        THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE STATEMENTS.


                                      F-6
<PAGE>


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS    Bio-Imaging Technologies, Inc. and
                                              Subsidiaries

1.  PRINCIPAL BUSINESS ACTIVITY AND SIGNIFICANT ACCOUNTING POLICIES

DESCRIPTION OF BUSINESS AND FUTURE OPERATIONS
Bio-Imaging Technologies, Inc. and Subsidiaries ("Bio-Imaging" or "the Company")
is a  pharmaceutical  contract service  organization,  operating in one business
segment,  providing services that support the product development process of the
pharmaceutical,   biotechnology  and  medical  device  industries.  The  Company
specializes  in  assisting  its  clients  in the design  and  management  of the
medical-imaging component of clinical trials for all modalities which consist of
computerized tomography ("CT"), magnetic resonance imaging ("MRI"), x-rays, dual
energy x-ray absorptiometry ("DEXA"), position emission tomography single photon
emission  computerized  tomography  ("PET  SPECT") and  ultrasound.  The Company
provides  services  which include the  processing and analysis of medical images
and the  data-basing and regulatory  submission of medical images,  quantitative
data and text.

The Company's  2001 operating plan contains  assumptions  regarding  revenue and
expenses. The achievement of the operating plan depends heavily on the timing of
work  performed  by the  Company on  existing  projects  and the  ability of the
Company to gain and perform work on new projects. Project cancellations,  delays
in the timing of work  performed  by the  Company on  existing  projects  or the
inability of the Company to gain and perform work on new projects  could have an
adverse  impact on the  Company's  ability to  execute  its  operating  plan and
maintain  adequate  cash  flow.  In the  event  actual  results  do not meet the
operating  plan,  management  believes  it could  execute  contingency  plans to
mitigate such effects.  Such plans include additional  financing,  to the extent
available,  through the accounts receivable financing agreement. In addition, in
November  2000,  the members of the Board of Directors of the Company,  in their
individual capacities,  committed up to an aggregate amount totaling $100,000 in
the form of a  short-term  loan,  through  October  1,  2001,  if  needed by the
Company.  Considering  the cash on hand  and  based  on the  achievement  of the
operating plan and management's  actions taken to date,  management  believes it
has the ability to continue to generate sufficient cash to satisfy its operating
requirements  in the normal  course of business.  However,  no assurance  can be
given that sufficient cash will be generated from operations. As of November 30,
2000, the Company's cash balance was approximately $616,000.

PRINCIPLES OF CONSOLIDATION
The accompanying  consolidated  financial statements include the accounts of the
Company and its wholly owned subsidiaries, Oxford Bio-Imaging Research, Inc. and
Bio-Imaging Technologies Holding B.V. All significant intercompany  transactions
and balances have been eliminated.

USE OF ESTIMATES
The preparation of financial  statements in conformity  with generally  accepted
accounting principles requires management to make estimates and assumptions that
affect  the  reported  amounts  of assets  and  liabilities  and  disclosure  of
contingent  assets and  liabilities at the date of the financial  statements and
the  reported  amounts of revenues  and expenses  during the  reporting  period.
Actual results could differ from those estimates.


                                      F-7
<PAGE>


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS    Bio-Imaging Technologies, Inc. and
                                              Subsidiaries

CASH AND CASH EQUIVALENTS
The  Company   maintains   substantially  all  of  its  cash  in  one  financial
institution.   The  Company  has  defined  cash  equivalents  as  highly  liquid
investments with an original maturity at the time of purchase of three months or
less.

REVENUE RECOGNITION
Project  revenues are recognized  primarily  using the  percentage-of-completion
method of  accounting  for  services  rendered in  connection  with  contractual
arrangements,  which generally range from a few months to two years.  Provisions
for losses  expected to be incurred on contracts  are  recognized in full in the
period in which it is determined that a loss will result from performance of the
contractual  arrangement.  Unbilled services are recorded for revenue recognized
to date that is currently  unbilled to the client pursuant to contractual terms.
In general,  amounts become  billable  pursuant to contractual  milestones or in
accordance with predetermined payment schedules. Unbilled services are generally
billable  within  one year from the  respective  balance  sheet  date.  Accounts
receivable include  approximately  $770,000 and $806,000 of unbilled receivables
at September 30, 2000 and 1999,  respectively.  Deferred revenue is recorded for
cash received from clients for services which have not yet been  provided at the
respective  balance sheet date.  Revenue from other  activities is recognized as
services are performed.

PROPERTY AND EQUIPMENT
Depreciation  of property and equipment is provided for using the  straight-line
method over the estimated useful lives of the respective assets. Amortization of
leasehold improvements is provided for over the related lease term.

CAPITALIZED SOFTWARE DEVELOPMENT
The  Company   capitalizes   software   development  costs  after  technological
feasibility  has been determined and ceases  capitalization  at such time as the
end product is available for general release to the public. The establishment of
technological  feasibility  and the  ongoing  assessment  of  recoverability  of
capitalized  software   development  costs  require  considerable   judgment  by
management with respect to certain external factors  including,  but not limited
to, anticipated future revenue,  estimated economic life and changes in software
and hardware  technologies.  At September 30, 2000,  management has estimated an
economic  useful  life  of  60  months  and  is  amortizing  these  costs  on  a
straight-line  basis  over this  period.  The  amortization  period is  reviewed
annually by  management.  During  2000,  the Company  capitalized  approximately
$47,000 of software  development costs. The Company had no software  development
costs that were capitalized during 1999.

LONG LIVED ASSETS
The  provisions  of  Statement  of  Financial   Accounting   Standards  No.  121
"Accounting  for the  Impairment of  Long-Lived  Assets"  requires,  among other
things,  that an  enitity  review its  long-lived  assets  and  certain  related
intangibles for impairment  whenever changes in circumstances  indicate that the
carrying  amount  of an  asset  may  not be  fully  recoverable.  Impairment  of
long-lived assets exist if, at a

                                      F-8
<PAGE>

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS    Bio-Imaging Technologies, Inc. and
                                              Subsidiaries

minimum,  the future  expected  cash flows  (undiscounted  and without  interest
charges) from an entity's  operations  are less than the carrying value of these
assets. The Company does not believe that any such changes in circumstances have
occurred.

BUSINESS ACQUISITION
In May 1999,  the  Company  acquired  the  operations  of Bona Fide,  Ltd.  in a
transaction  accounted for as a purchase.  Tangible assets acquired were $10,000
and liabilities  assumed were approximately  $190,000,  resulting in goodwill of
$180,000.  The  liabilities  assumed  primarily  represent  deferred  revenue of
$122,000  which the Company  expects to recognize as project  revenues  over the
duration  of the  client  contracts  which were  assumed  by the  Company in the
acquisition.  Goodwill is being amortized using a straight-line method over five
years.  In addition to the amount paid at closing,  additional  payments for the
acquisition  may be made  based  on  certain  revenues  being  achieved  for the
twelve-month  period ending on the anniversary of the closing date. Such revenue
was not  achieved  through May 2000.  The  acquisition  was not  material to the
Company's consolidated financial position or results of operations.

FOREIGN CURRENCY TRANSLATION
The  U.S.  Dollar  is  the  functional   currency  for  the  Company's   foreign
subsidiaries.

EARNINGS PER SHARE
The Company  follows SFAS No. 128 - "Earnings per Share. " SFAS No. 128 requires
the  presentation  of basic  earnings per share and diluted  earnings per share.
Basic loss per common share was calculated  based upon the net loss available to
common  stockholders  divided by the weighted average number of shares of common
stock outstanding during the period.  Diluted loss per common share for the year
ended September 30, 2000 and 1999 excludes  options  (1,412,960 and 1,192,370 as
of  September  30,  2000 and 1999,  respectively)  and  warrants  (66,667  as of
September 30, 2000 and 1999) as their inclusion would be antidilutive.

RECENTLY ISSUED ACCOUNTING STANDARDS
In June 1998,  the  Financial  Accounting  Standards  Board issued SFAS No. 133,
"Accounting  for Derivative  Instruments  and Hedging  Activities" as amended by
SFAS No. 137,  "Accounting for Derivative  Instruments and Hedging  Activities -
Deferral of the Effective  Date of FASB Statement No. 133 - an Amendment of FASB
Statement  No.  133"  and SFAS  No.  138,  "Accounting  for  Certain  Derivative
Instruments and Certain Hedging  Activities - an Amendment of FASB Statement No.
133." Adoption of SFAS No. 133, as amended,  is required for fiscal  quarters of
fiscal years  beginning  after June 15, 2000.  The Company does not believe that
the new  standard  will have a  material  impact on the  Company's  consolidated
financial  statements.  In December 1999, the Securities and Exchange Commission
issued Staff  Accounting  Bulletin  No. 101 (SAB 101),  Revenue  Recognition  in
Financial  Statements.  SAB 101 provides guidance for revenue  recognition under
certain circumstances. The accounting and disclosures prescribed by SAB 101 will
be  effective  for the  fourth  quarter  of fiscal  year  2001.  The  Company is
currently  evaluating  the  impact the  application  of SAB 101 will have on its
financial position or results of operations.


                                      F-9
<PAGE>

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS    Bio-Imaging Technologies, Inc. and
                                              Subsidiaries

2.  PROPERTY AND EQUIPMENT

Property and equipment, at cost, consists of the following:

<TABLE>
<CAPTION>

                                                                                                    Estimated
September 30,                                             2000                 1999                Useful Life
--------------------------------------------------------------------------------------------------------------
<S>                                                   <C>                  <C>                       <C>
Equipment                                             $ 2,253,935          $ 3,496,440               5 years
Equipment under capital leases                            673,060              640,914               5 years
Furniture and fixtures                                    187,853              266,554               7 years
Leasehold improvements                                     48,391               84,060         Term of lease
Computer software costs                                    46,667              123,436             60 months
--------------------------------------------------------------------------------------------------------------
                                                        3,209,906            4,611,404
Less accumulated depreciation
and amortization                                       (1,917,562)          (3,431,150)
--------------------------------------------------------------------------------------------------------------
                                                      $ 1,292,344          $ 1,180,254
==============================================================================================================
</TABLE>

During  2000,  the Company  retired  property  and  equipment  of  approximately
$2,049,000  that was fully  depreciated.  Accumulated  depreciation  related  to
equipment  acquired under capital leases amounted to approximately  $363,000 and
$537,000 at September 30, 2000 and 1999, respectively.  Accumulated amortization
related to computer software costs amounted to approximately $3,000 and $123,000
at September 30, 2000 and 1999, respectively.

3.  LONG-TERM DEBT

Long-term debt consists of equipment lease  obligations  and notes payable.  The
equipment   lease   obligations   and  notes  payable  are  payable  in  monthly
installments ranging from $1,170 to $4,961,  including interest at rates ranging
from 10.24% to 13.75%,  through January 2003. The debt is  collateralized by the
related equipment.

Aggregate maturities of long-term debt at September 30, 2000 are as follows:

            2001                                            $ 150,796
            2002                                              138,833
            2003                                               25,306
---------------------------------------------------------------------
                                                            $ 314,935
=====================================================================

In  August  1999,  the  Company  entered  into an  agreement  with a bank  for a
revolving  line  of  credit  of up  to $500,000 collateralized  by the Company's
assets. Interest is payable at 1.50% over the bank's prime

                                      F-10
<PAGE>

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS    Bio-Imaging Technologies, Inc. and
                                              Subsidiaries

rate of interest.  The agreement  requires the Company,  among other things,  to
maintain  minimum  levels of tangible  net worth and certain  minimum  financial
ratios.  In October  1999,  the bank notified the Company that it would not make
any  advances  under the  existing  line of credit  until the  Company  provides
sufficient evidence  satisfactory to the bank of an improvement in the Company's
operating, financial and liquidity position. At such time, the bank may consider
permitting  further  advances  pursuant to the loan agreement.  At September 30,
2000 the Company had no borrowings under the line of credit.

In December  1999,  the Company  entered  into an accounts  receivable  purchase
agreement with the same bank, whereby,  the Company may assign up to $500,000 of
eligible  accounts  receivable to the bank. The bank, in turn, would advance the
Company up to 80% of the assigned accounts receivable amount. In March 2000, the
bank  increased the eligible  accounts  receivable to  $1,000,000.  Although the
agreement is contractually  renewable each year, it is cancelable by the bank at
any time. During 2000, the Company assigned accounts receivable of $1,698,414 to
the bank of which all has been repaid to the bank.  At September  30, 2000,  the
Company had no borrowings under the accounts receivable purchase agreement.

4.  STOCKHOLDERS' EQUITY

In  December  1991  and  June  1992,  the  Company's   Board  of  Directors  and
stockholders,   respectively,   approved   the   adoption  of  the   Bio-Imaging
Technologies,  Inc.  Stock  Option Plan.  In January 1995 and 1997,  the Company
amended  this plan to provide  for the  granting  of  options to key  employees,
directors and  consultants  to purchase an aggregate of not more than  1,800,000
and 2,400,000 shares,  respectively,  of the Company's common stock. Each option
is exercisable  into one share of common stock.  Options granted pursuant to the
plan may be  qualified  incentive  stock  options,  as defined  in the  Internal
Revenue Code, or nonqualified options. The exercise price of qualified incentive
stock options may not be less than the fair market value of the Company's Common
Stock at the date of grant.  The term of such stock  options  granted  under the
plan shall not exceed ten years and the vesting  schedule  of such stock  option
grants varies from  immediate  vesting on date of grant to vesting over a period
of up to five years.

The following table summarizes the transactions  pursuant to the Company's stock
option plan for the two-year period ended September 30, 2000:


                                      F-11
<PAGE>


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS    Bio-Imaging Technologies, Inc. and
                                              Subsidiaries
<TABLE>
<CAPTION>

                                                                          Number of                  Weighted Average
                                                                           Options                    Exercise Price
----------------------------------------------------------------------------------------------------------------------
<S>                                                                       <C>                              <C>
Unexercised options outstanding at
September 30, 1998                                                        1,268,750                        $1.41
Options granted                                                             267,620                         0.63
Options canceled                                                           (344,000)                        1.05
----------------------------------------------------------------------------------------------------------------------
Unexercised options outstanding at
September 30, 1999                                                        1,192,370                         1.44
Options granted                                                             329,340                         0.89
Options canceled                                                           (108,750)                        0.93
----------------------------------------------------------------------------------------------------------------------
Unexercised options outstanding at
September 30, 2000                                                        1,412,960                        $1.49
======================================================================================================================
</TABLE>

Approximately  932,000 and 765,000 options are exercisable at September 30, 2000
and 1999, respectively, at a weighted average exercise price of $1.49 and $1.66,
respectively.

The Company has elected,  in  accordance  with the  provisions  of SFAS No. 123,
Accounting for  Stock-Based  Compensation  ("SFAS 123"), to apply the accounting
rules under APB Opinion No. 25,  Accounting  for Stock Issued to Employees,  and
related  interpretations  in accounting for its stock options and,  accordingly,
has presented the  disclosure-only  information  as required by SFAS 123. If the
Company  had  elected  to  recognize  compensation  cost based on the fair value
method of SFAS 123, the  Company's  net loss  applicable to common stock and net
loss per common share for the years ended September 30, 2000 and 1999 would have
been the pro forma amounts indicated in the following table:

<TABLE>
<CAPTION>

Year ended September 30,                                                 2000            1999
---------------------------------------------------------------------------------------------------
<S>                                                                   <C>             <C>
Net loss applicable to common stock - as reported                     $ (732,431)     $(745,459)
Net loss applicable to common stock - pro forma                       $ (789,881)     $(842,614)
Net loss per common share - basic and diluted - as reported           $    (0.09)     $   (0.10)
Net loss per common share - basic and diluted- pro forma              $    (0.10)     $   (0.11)
</TABLE>

At  September  30,  2000,  by range of  exercise  prices,  the  number of shares
represented by outstanding  options with their weighted  average  exercise price
and weighted  average  remaining  contractual  life, in years, and the number of
shares  represented by exercisable  options with their weighted average exercise
price are as follows:

                                      F-12
<PAGE>

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS    Bio-Imaging Technologies, Inc. and
                                              Subsidiaries
<TABLE>
<CAPTION>
                    Options Outstanding                                                       Options Exercisable
---------------------------------------------------------------------------------  ----------------------------------
   Range of                           Weighted Average       Weighted                                 Weighted
   Exercise              Number          Remaining            Average                 Number           Average
    Prices            Outstanding     Contractual Life    Exercise Price            Exercisable     Exercise Price
---------------------------------------------------------------------------------  ----------------------------------
<S>                    <C>                <C>                  <C>                   <C>               <C>
 $0.63 - $1.44         1,260,960          7.52 years           $0.87                 779,661           $0.88
 $4.13 - $4.69           152,000          1.67 years           $4.60                 152,000           $4.60
---------------------------------------------------------------------------------  ----------------------------------
 $0.63 - $4.69         1,412,960          6.89 years           $1.27                 931,661           $1.49
=================================================================================  ==================================
</TABLE>

The weighted  average  fair value of options  granted in 2000 and 1999 was $0.77
and $0.38,  respectively.  The fair value of each option granted is estimated on
the  date of  grant  using  the  Black-Scholes  option  pricing  model  with the
following weighted average assumptions:

Grants for the year ended September 30,        2000                 1999
--------------------------------------------------------------------------------
Risk-free interest rate                        5.9%                 4.7%
Expected dividend yield                        0.0%                 0.0%
Expected volatility                            118%                 117%
Expected life in years                         6.00                 6.00

On December 14, 1995,  the Company  reserved  3,850,000  shares of the Company's
common stock for issuance upon conversion of the preferred stock and exercise of
the warrants issued to Investment Partners of America, L.P. ("IPA") (see below).

On  December  21,  1995,  IPA  purchased  (i)  416,667  shares of the  Company's
convertible  preferred  stock,  (ii) one five year  warrant to purchase  416,667
shares of the Company's  common stock at an initial  exercise price of $1.50 per
share  and  (iii)  one five  year  warrant  to  purchase  416,667  shares of the
Company's  common stock at an initial  exercise  price of $2.50 per share for an
aggregate  purchase  price of $500,000  pursuant to a purchase  agreement  dated
December 8, 1995  ("Purchase  Agreement").  The preferred stock provides for (i)
voting rights on an as-converted to common stock basis, with standard protective
provisions;   (ii)  a  liquidation   preference   of  $1.20  per  share;   (iii)
anti-dilution  protection  and  price  protection  provisions;  (iv)  cumulative
dividends of $0.096 per share per annum,  payable out of funds legally available
for the payment of dividends and only upon declaration of dividends by the Board
of  Directors of the Company;  and (v)  registration  rights with respect to the
shares of common stock issuable upon conversion of the preferred stock.

On June 26, 1996, the Company  issued to IPA, one five-year  warrant to purchase
66,667  shares of the  Company's  common stock at an initial  exercise  price of
$1.05 per share,  the fair market value of the Company's common stock at date of
issuance.  The  exercise  price of this  warrant  issued  to IPA is  subject  to
adjustment to protect against dilution in the event of certain  transactions and
has certain  piggyback  registration  rights.  As of  September  30,  2000,  the
adjusted exercise price of the warrant is $0.63.


                                      F-13
<PAGE>

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS    Bio-Imaging Technologies, Inc. and
                                              Subsidiaries

The 8% convertible  cumulative  preferred stock is convertible into common stock
of the Company on a  one-for-one  share basis  subject to  adjustment to protect
against dilution in the event of certain  transactions.  Conversion may occur in
whole or in part during the first  five-year  period from the date of  issuance,
December 21, 1995,  at the option of the holder.  The Company may require a full
conversion  at any time after five years from date of  issuance.  The  preferred
stock has certain piggyback registration rights.

The Company is required to pay  semiannual  dividends on preferred  stock at the
rate of  approximately  $0.096 per share per annum,  and as when declared by the
Board of  Directors.  Dividends  are payable  either in cash or in the Company's
common stock at the  discretion of the Company.  At September 30, 2000,  accrued
preferred dividends aggregated  approximately  $10,000 or $0.02 per share of the
preferred stock.

The preferred  stockholders are entitled to vote on all matters submitted to the
vote of the common  stockholders  and are  included in  determining  quorums and
voting results.

5.  COMMITMENTS

The  Company  has  entered  into  noncancelable   operating  leases  for  office
facilities which expire through January 2005.

Future minimum  aggregate  rental payments on the  noncancelable  portion of the
lease are as follows:

Year ending September 30,
        2001                                 423,000
        2002                                 404,000
        2003                                 372,000
        2004                                 343,000
        2005                                 115,000
----------------------------------------------------
                                         $ 1,657,000
====================================================

Rent expense  charged to operations  for the years ended  September 30, 2000 and
1999 approximated $306,000 and $249,000, respectively.

The Company has an employment contract with an officer which expires February 1,
2002.   The  amount  due  under  this   contract  is   approximately   $253,000.
Additionally,  the  contract  provided  for the  granting of options to purchase
150,000 shares of the Company's common stock at $0.63 which was greater than the
fair market value of the  Company's  common stock at the date of grant (see note
4).  Options to purchase  37,500  shares of the  Company's  common  stock vested
immediately,  and  37,500  on  each  of  the  first,  second  and  third  of the
anniversary date of grant.


                                      F-14
<PAGE>

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS    Bio-Imaging Technologies, Inc. and
                                              Subsidiaries

6.  EMPLOYEE BENEFIT PLAN

On December 17, 1991, the Company  adopted the  Bio-Imaging  Technologies,  Inc.
Employees' Savings Plan (the "401(k) Plan"), a defined  contribution plan with a
cash or  deferred  arrangement.  Under the terms of the  401(k)  Plan,  eligible
employees may elect to reduce their annual compensation up to 15%, subject to an
annual limit prescribed by the Internal  Revenue  Service.  The Company may make
discretionary  matching  contributions  in cash,  subject  to plan  limits.  The
Company did not make a matching contribution to this account for the years ended
September 30, 2000 and 1999.

7.  MAJOR CUSTOMERS

Revenue from two major  customers,  encompassing  seven projects,  accounted for
approximately  20% and 13% of project  revenues for the year ended September 30,
2000 and  revenue  from three major  customers,  encompassing  eleven  projects,
accounted for  approximately  16%, 13% and 11% of project  revenues for the year
ended  September  30, 1999.  No other  customers  accounted for more than 10% of
project revenues.

Two customers  accounted for approximately 25% and 20% of accounts receivable at
September 30, 2000 and two customers  accounted for approximately 17% and 14% of
accounts receivable at September 30, 1999. No other customers accounted for more
than 10% of accounts receivable.

8.  INCOME TAXES

The Company  has  federal net  operating  loss  carryforwards  of  approximately
$7,123,000  which expire in various years through 2020. The deferred  income tax
assets  at  September  30,  2000  and  1999  of  approximately   $2,400,000  and
$2,200,000,  respectively,  represent the tax effect of the net  operating  loss
carryforwards.  Due to the  uncertainty  regarding the ultimate amount of income
tax  benefits  to be derived  from the net  operating  loss  carryforwards,  the
Company has recorded valuation allowances against the entire deferred tax asset.
As a result of moving the corporate headquarters to Pennsylvania, the Company is
not able to  utilize  their New  Jersey  net  operating  loss  carryforwards  of
approximately $6,800,000.

9.  FOREIGN OPERATIONS

Foreign  customers  accounted for  approximately 11% and 32% of project revenues
for the years ended September 30, 2000 and 1999, respectively.


                                      F-15