SECURITIES AND EXCHANGE COMMISSION
                      Washington, DC  20549

                           FORM 10-KSB
(Mark One)

    [  X  ]    ANNUAL  REPORT UNDER SECTION 13 or  15(d)  OF  THE
               SECURITIES EXCHANGE ACT OF 1934

   For the fiscal year ended December 31, 1997

                               OR

    [     ]  TRANSITION REPORT UNDER SECTION 13 OR 15 (d) OF  THE
             SECURITIES EXCHANGE ACT OF 1934

   For the transition period from __________ to ____________.

                    Commission File Number:  0-23055
                                
                                 Omega Orthodontics, Inc.
         (Name of Small Business Issuer in Its Charter)

            Delaware                                    95-4596853
(State or Other Jurisdiction of                    (I.R.S. Employer
Incorporation or Organization)                   Identification No.)

3621 Silver Spur Lane, Acton, California                     93510
(Address of Principal Executive Offices)                 (Zip Code)

                               (805) 269-2841
        (Issuer's Telephone Number, Including Area Code)

   Securities registered under Section 12(b) of the Exchange Act: None

   Securities registered under Section 12(g) of the Exchange Act:
                                
                  Common Stock, $.01 par value
            Redeemable Common Stock Purchase Warrants

   Check whether the issuer: (1) filed all reports required to be
filed by Section 13 or 15(d) of the 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 is not 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 the Form 10-KSB. [   ]

    The  issuer's revenues for the year ended December  31,  1997
were $ 975,918.

    The  aggregate market value of the voting stock held by  non-
affiliates  as of February 27, 1998 was $11,265,000.  The  amount
was computed by reference to the average bid and asked prices  of
the Common Stock on that date on The Nasdaq Stock Market.

   As of February 27, 1998, 4,800,982 shares of Common Stock were
outstanding,  and  2,070,000  Redeemable  Common  Stock  Purchase
Warrants were outstanding.

               DOCUMENTS INCORPORATED BY REFERENCE

    Portions  of  the registrant's Proxy Statement for  the  1998
annual  meeting of stockholders, which is expected  to  be  filed
within  120  days after the end of the registrant's fiscal  year,
are  incorporated by reference in Part III of this  Report.   The
registrant's Current Report on Form 8-K dated January 14, 1998 is
also  incorporated  by reference in Part  III,  Item  8  of  this
Report.
                                
               Contents and Cross Reference Sheet
  (furnished pursuant o General Instruction F.2 of From 10-KSB)



Part I                                               Page
Item 1        Description of Business                 1
Item 2        Description of Property                12
Item 3        Legal Proceedings                      12
Item 4        Submission of Matters to a Vote of     
              Security Holders                       12
                                                     


Part II                                              
Item 5        Market for Common Equity and Related   
              Stockholder Matters                    12
Item 6        Management's Discussion and Analysis   15
Item 7        Financial Statements                   21
Item 8        Changes in and Disagreements With      44
              Accountants on Accounting and
              Financial Disclosure                   44
                                                     


Part III                                             
Item 9        Directors, Executive Officers,         
              Promoters and Control Persons;
              Compliance with Section 16(a) of the
              Exchange Act                           44
Item 10       Executive Compensation                 44
Item 11       Security Ownership of Certain          
              Beneficial Owners and Management       44
Item 12       Certain Relationships and Related      
              Transactions                           44   
Item 13       Exhibits, List and Reports on Form 8-K 44
                                                     

Signatures                                           52


                             PART I
                                
                   Forward Looking Statements

     Except for the historical information contained herein, the
discussion in this Report and any document incorporated herein by
reference contains certain forward-looking statements that
involve risks and uncertainties, such as statements of the
Company's plans, strategies, objectives, expectations and
intentions.  The cautionary statements made in "Management's
Discussion and Analysis of Financial Condition and Results of
Operations -- Safe Harbor Statement under the Private Securities
Litigation Reform Act of 1995" should be read as being applicable
to all forward-looking statements wherever they appear.  The
Company's actual results could differ materially from those
discussed or incorporated herein.  Factors that could cause or
contribute to such differences include those discussed in
Management's Discussion and Analysis of Financial Condition and
Results of Operations as well as those discussed elsewhere herein
or in the documents incorporated herein by reference.

Item 1.  Description of Business

     Omega Orthodontics, Inc. (the "Company" or "Omega") provides
management and marketing services primarily to orthodontic
practices and other specialty dental practices in the United
States.  From its inception in August 1996 through September 30,
1997, Omega provided these services on a fee for services basis.
Following its initial public offering of securities on October 6,
1997 (the "IPO"), the Company offers its services primarily under
an affiliate relationship whereby it purchases the equity
interests in a management services organization ("MSO") that
holds certain assets of and is associated with an orthodontic or
other dental specialty practice that contractually affiliates
with the Company (individually, an "Affiliated Practice" and
collectively, the "Affiliated Practices") and enters into a long-
term management services agreement  (the "Management Services
Agreement") with the Affiliated Practice.

     As of December 31, 1997, the Company had completed
affiliation agreements with nine Affiliated Practices.  In
addition, the Company had entered into interim management
agreements with two specialty dental practices pursuant to which
the Company provided its services on a fee for services basis
pending completion of affiliation agreements with such practices.
In January 1998, the Company completed affiliation agreements
with five new Affiliated Practices, including the two practices
with which it had previously entered into interim management
agreements.

     Pursuant to its Management Services Agreements, the Company
receives a monthly management fee for providing facilities,
support staff and supplies to its Affiliated Practices and
institutes a program of systems, methods and procedures the
Company refers to as the Omega Exceptional Practice Model (the
"Model"). The Model is designed to increase the Affiliated
Practice's profitability by focusing on and improving customer
service while simultaneously reducing costs and increasing
operating efficiency.

     Omega seeks to affiliate with established orthodontic and
other specialty dental practices that Omega believes have the
potential for significant growth utilizing the Model.  Omega
considers financial and operational factors that include the
practice's gross income, cost structure, existing treatment
contracts, fees, schedules, referral rates and sources, health
maintenance organization relationships, case starts, appointments
per day and average treatment times.  Omega also evaluates
demographic factors that include the practice's location with
respect to and the average income levels and concentration of
families with children in the area.

     The Company's strategy is to (i) enter into affiliation
agreements and Management Services Agreements with established
orthodontic and other specialty dental practices that meet the
Company's criteria and (ii) achieve operating efficiencies and
increased profitability for each such practice through the
implementation of the Model.  The Model is designed to permit the
practice to meet or exceed patient expectations by (a) offering
flexible payment plans, (b) scheduling convenient appointment
times, (c) ensuring that treatment is delivered on time, (d)
updating patients and their referring dentists regularly on
treatment programs and (e) training staff to anticipate and
address patient needs.

     The Company has focused its initial marketing efforts on the
practices of the approximately 4,500 orthodontists over the age
of 47 who the Company believes are planning their transition to
retirement.  The Company believes it can generally place a higher
value on a mature practice than other potential buyers, many of
whom are recent orthodontic graduates.  The Company believes that
this higher valuation, combined with consideration in the form of
a combination of cash, notes and the Company's Common Stock and
the opportunity to delegate managerial and marketing
responsibilities to an experienced management team, generally
makes the Company an attractive alternative for orthodontists
planning their transition to retirement.  The Company will also
target younger orthodontists who may want to merge their
practices with the practice of an orthodontist in transition or
take over such a practice, as well as other specialty dental
practitioners, like endodontists, who may be in situations
similar to those experienced by those orthodontists targeted by
the Company.

The Orthodontic Industry

     General.    Omega  believes  that  the  annual  market   for
orthodontic treatment and services is approximately $3.6 billion.
Based  on  U.S.  census data that indicate  that  the  number  of
children  between  the  ages of five  and  19  will  increase  by
approximately 10.4 million by the year 2000, the Company  expects
that the growth in this population group will result in increased
demand for orthodontic services.  The orthodontic marketplace  is
highly  fragmented and consists of approximately 9,000 practicing
orthodontists,   a  significant  majority  of   whom   are   sole
practitioners.  Omega believes that many of the orthodontists  in
practice today have excess patient capacity and lack the training
and resources in management and marketing techniques to fill that
capacity  effectively.  It is Omega's belief that less than  five
percent  of  the orthodontic practices in the United  States  are
presently managed by independent, professional management service
organizations and that an opportunity exists for the  Company  to
market  and  sell its services to the orthodontic practices  that
are not currently managed by such organizations.

    The  projected growth of the orthodontics market derives from
several  demographic and economic factors.  Omega  believes  that
the  number  of patients of prime orthodontic treatment  age  (12
years  old) will likely remain at a level that is 15%  higher  in
the  ten  years ending in 2002 than in the prior ten year period.
Also, although orthodontic treatment has been historically viewed
as  an  expensive  elective, advances  in  practice  methods  and
technologies  have  made it relatively  more  affordable.   As  a
result,  orthodontic treatment is being sought  by  a  broadening
segment of American society.

    Orthodontic Practice Dynamics.  Although there exists a large
and growing demand for orthodontic services in the United States,
the  Company believes that the orthodontic industry is  presently
ill-prepared  to  meet  that  demand.   Orthodontists,  the  vast
majority of whom are sole practitioners, are often highly skilled
clinicians  but generally are not trained in marketing themselves
as  professional service providers.  Most rely on referrals  from
other  dentists and from current or past patients.   Accordingly,
the  Company  believes that achieving sustainable growth  through
referrals  requires both clinical excellence and a patient  focus
that emphasizes value, flexibility and efficiency.

    In order to increase profitability, the Company believes that
orthodontists   must  improve  their  management  and   marketing
techniques.   Unlike  many other medical and dental  specialties,
orthodontics involves treatment delivered over a period of two to
three  years  for  a  fixed fee.  Much of the  treatment  can  be
provided  efficiently  by  the  orthodontist  delegating  certain
clinical  and  communications tasks to trained  assistants.   The
Company   believes   that  creative  management   and   effective
delegation would allow the orthodontist to reduce treatment costs
per  patient.   In addition, the Company believes that  the  well
managed  orthodontic  practice would also be  able  to  handle  a
larger patient base, and, with a patient centered emphasis on the
quality and efficiency of the services it offers, should be  able
to  build  that base through professional and patient  referrals.
As  a  result, the Company believes that an orthodontic  practice
with a qualified and capable orthodontist operating under a well-
designed efficient schedule and utilizing professional management
and   marketing   practices   is   capable   of   enhancing   its
profitability.

    Market  for  Orthodontic Practices.  The value of orthodontic
practices  in  the United States has fallen for the past  several
years.   The number of potential sellers, generally orthodontists
approaching retirement age, is relatively large compared  to  the
potential  purchasers.   This downward  pressure  on  prices  for
orthodontic  practices  results  primarily  from  the  fact  that
approximately  4,500, or 50%, of the practicing orthodontists  in
the  United States are over the age of 47.  The Company  believes
that many are looking to make a transition out of active practice
while realizing as much value as possible from the goodwill  they
have built up over their years in practice.

    State  laws  governing  the practice  of  dentistry  and  its
specialties  and  the  shrinking number of orthodontic  graduates
intending to practice in the United States have combined to limit
the  number  of  potential purchasers of  orthodontic  practices.
State  dental practice statutes and professional codes  generally
provide  that only orthodontists may own, operate or  control  an
orthodontic  practice.   These restrictions  have  functioned  to
depress  the market for orthodontic practices and have  inhibited
the development of professional management in the industry.

    Another  major  factor in limiting the value  of  orthodontic
practices  is  the  historic oversupply of orthodontists  in  the
United  States which has reduced the number of recent orthodontic
graduates.   In  addition, many of the more recent graduates  are
foreign students who plan to return to their own countries.   The
orthodontic  graduates who seek to buy a practice generally  have
student  loans  and limited financial resources.   As  a  result,
Omega believes that the average purchase price for an orthodontic
practice  has  fallen from roughly one year's gross  revenues  to
approximately  70%  of  that number.  In  addition,  the  selling
orthodontists often must finance the purchase by accepting a note
for  a  significant part of the purchase price and, in  order  to
ensure  that  the practice performs well enough  to  service  the
debt, often must stay involved in the management and marketing of
the practice.

Business Strategy

    The  Company's strategy has two principal components.  First,
the   Company  identifies  established  orthodontic   and   other
specialty  dental practices that it believes have  potential  for
significant  growth utilizing the Model and offers  to  affiliate
with  and  manage  those practices.  Second,  once  an  affiliate
relationship  is  established, the  Company  and  the  affiliated
dental  practitioner  (the  "Affiliated  Practitioner")  and  the
practitioner's  staff implement the Model  in  order  to  achieve
operating  efficiencies  and  increase  profitability   for   the
practice.

    Identify Potential Affiliations.  The Company's success  will
largely  depend  upon  the  quality and quantity  of  orthodontic
practices that it can attract to affiliate with the Company.  The
Company selects practices to consider affiliating with which  are
operated  by orthodontists and other dental specialists  who  are
qualified  members of the American Association of  Orthodontists.
Management  believes  that  the  Company  has  the  resources  to
identify  a significant number of potential affiliates that  meet
the Company's criteria for affiliation.  Although the Company has
been  in  operation for less than two years, the members  of  the
senior   management  team  responsible  for  operations,  Messrs.
Schulhof,  Bellavia and Elliott, each have been involved  in  the
orthodontic  industry  for  12  or  more  years.   Through  their
extensive  presentations  at  orthodontic  seminars  and   active
consulting  practices to the orthodontic industry, the  Company's
senior   management  team  has  relationships   with   practicing
orthodontists  throughout  the country.   The  Company  has  also
established  a program of regular trade journal advertising,  and
Mr.  Schulhof, in conjunction with Messrs. Bellavia and  Elliott,
has  written a series of articles for orthodontic trade  journals
that  outline  the  Model  and its benefits  for  the  practicing
orthodontist.

   Once the Company identifies a potential affiliate, the Company
conducts  a  comprehensive analysis of the practice, including  a
thorough  financial  and  operational review  and  evaluation  of
staff, facilities, equipment and systems.  Initially, an estimate
of  the current value of the practice is calculated based on  the
practice's  gross income, net profit and new treatment  contracts
written  during  the prior twelve months.  The Company  evaluates
the  practice's  capacity  for improvement  under  the  Model  by
analyzing (i) the number of new patient exams, treatment  starts,
patients in active treatment and patients seen per day, (ii)  the
fees  charged for different treatments, (iii) the costs  incurred
by   the   practice  for  employees,  facilities,  supplies   and
laboratory  work  and  (iv) the number of  treatment  chairs  and
dental  and clinical assistants and the square footage of  office
space  employed  by  the  practice.   Also,  current  staff   are
interviewed to determine their suitability for and commitment  to
the practice, and facilities and equipment are reviewed to ensure
that  they  will  support a larger and growing  practice  without
significant  additional  cost.  Finally, the  practice's  current
systems  for starting new patients, reviewing treatment programs,
scheduling,  communicating with patients  and  referral  sources,
marketing and controlling expenses, and the cost of upgrading  or
replacing the systems, are analyzed.

   The Company seeks practices that have the capacity to increase
their  profitability  initially through improved  performance  on
existing patient bases rather than through immediately increasing
new patient exams.  The Company generally requires that practices
demonstrate  the  potential  to grow  approximately  40%  with  a
relatively  small increase in new patient exams.  Practices  that
have  developed  strong professional referral  relationships  and
have attractive locations and facilities are preferred over those
that  rely  on  mass marketing techniques and health  maintenance
organization relationships to grow.

    The Company also evaluates demographic factors affecting  the
practice.    Practices  located  where  there   are   significant
concentrations  of families with young children  are  attractive,
particularly  when  the  families have higher  incomes  than  the
national average and these populations are stable or growing.  To
date,  the  Company has focused its efforts on locating practices
in  the  South or far West of the United States.  As of  February
28, 1998, the [12] Affiliated Practices maintain an aggregate  of
[13]  offices,  and such offices are situated  in  the  following
locales:  Goodyear and Bullhead City, Arizona; Huntington  Beach,
Woodland   Hills,  and  Encino,  California;  Colorado   Springs,
Colorado;  Conyers, Georgia; Champaign, Illinois; Elko and  Reno,
Nevada;  Watertown, South Dakota; Austin, Texas; and Glen  Allen,
Virginia.

    If  the  practice  satisfies the Company's  criteria  for  an
affiliation, an offer is made for the practice to affiliate  with
the  Company.  The Company outlines proposed financial  terms  of
the   affiliation,  including  the  Company's  valuation  of  the
practice  and  the  amount  of cash,  notes  and  shares  of  the
Company's  Common  Stock  that the Company  proposes  to  pay  to
acquire  the  equity  interests in the MSO  associated  with  the
practice.   Once the basic business terms of the affiliation  are
agreed   to,  the  parties  proceed  to  execute  an  affiliation
agreement and the related Management Services Agreement.  In some
cases,   the  parties  will  enter  into  an  interim  management
agreement pursuant to which the Company provides its services  on
a  fee  for  services basis pending completion of the affiliation
agreement and related Management Services Agreement.  The Company
has  paid, on average for each of its 12 Affiliated Practices,  a
combination  of  approximately  $315,000  in  cash   and   issued
approximately  87,000 shares of the Common Stock  valued  at  the
price  per  share of the Common Stock at the date of  affiliation
and, in certain cases, issued notes bearing interest at 8.5%  and
ranging  in  amount  between $53,000 and $374,000.   The  Company
plans   to  enter  into  affiliation  agreements  and  Management
Services  Agreements  with  up  to an  additional  20  Affiliated
Practices   during   1998  at  an  average  purchase   price   of
approximately  $600,000,  of  which  the  cash  portion  will  be
approximately $200,000.

    Implementing the Omega Exceptional Practice Model.  The Model
is  patient centered and designed to promote customer service and
increase   the   Affiliated  Practitioner's  productivity   while
permitting   the  Affiliated  Practitioner  to  deliver   quality
treatment.  The Model focuses the Affiliated Practitioner's  team
on  understanding patient expectations and provides the team with
the training, systems and other tools necessary to meet or exceed
those  expectations.  The Model  is generally  implemented  in  a
practice  over  a  period of 12 months and  involves  the  active
participation of the Company's professional staff, the Affiliated
Practitioner  and  his  or her staff and a  practice  facilitator
assigned  by  the  Company  to oversee the  entire  installation,
monitor its progress and provide follow-up support.

    Customer  service permeates all aspects of  the  Model.   The
Company provides a scheduling system that offers patients a  wide
choice   of  appointment  times,  including  night  and   weekend
appointments.   The  system also carefully plans  the  Affiliated
Practitioner's time so that the patient is seen on  schedule  and
the  work is performed within the allotted appointment time.  The
Company  offers  flexible payment plans  that  meet  the  varying
financial   situations  of  the patients  and  reviews  insurance
benefits  and credit issues with the patient in advance  so  that
patients  coming to a first exam will have sufficient information
at  the  end  of  that  exam to commit to the  proposed  plan  of
treatment.

    The Company believes that good communication between patients
and  the  Affiliated Practitioner's team is essential to building
successful  relationships and developing  customer  satisfaction.
The  Company  trains the Affiliated Practitioner and his  or  her
staff  in  interpersonal skills and communication techniques  and
carefully plans and scripts patient interactions so that the team
is  attuned  to  patient  needs and  can handle  their  questions
accurately  and  efficiently.  The staff  is instructed  to  make
courtesy  calls to patients after long or particularly  difficult
appointments  to  inquire  about  patient  comfort   and   answer
questions.  In addition, the Company  uses computerized  analysis
and   video  imaging  to  provide  the  patient  with   a   clear
understanding of the proposed treatment, including, in  the  case
of  orthodontics,  all planned tooth and jaw movements,  and  its
intended results.

   In order to enhance the total dental care the patient receives
and   to   improve  the  Affiliated  Practitioner's  professional
referral    sources,   the   Model   also   encourages   frequent
communication between his or her team and the referring  dentist.
Automated  diagnostic  letters that include  a  treatment  status
report   and  video  images  of  the  patient   are  periodically
delivered  to the referring dentist.  Brief seminars  on  current
dental  specialty developments are planned from time to  time  at
the  Affiliated Practitioner's office in order to keep  referring
dentists  and  their staffs informed and to promote opportunities
for professional and staff interaction.  By encouraging the close
integration of specialty and general dental services,  the  Model
promotes improved overall dental care for the patient and fosters
strong   relationships  with  the  general  dentists  for  future
referrals.

    The  Company  believes that a more productive  practice  also
serves  the  interest of the patients.  In order to increase  the
Affiliated Practitioner's productivity, the Model requires his or
her  team to establish operational goals, such as increasing  the
number  of treatment starts, percentage of patients seen on  time
and the dollars generated per minute of chair time. The team also
sets  financial and quality goals for the practice.  In order  to
assist  the  team in accomplishing these goals, the  Company  has
produced  written policies and procedures for the team  to  adopt
and follow and either upgrades the practice's present systems  or
installs  a new, computerized operational and financial reporting
system so that progress can be measured regularly.

     The  Company  believes  that  implementation  of  the  Model
generally  should  be accomplished over a 12 month  period.   The
program  is overseen by one of the Company's experienced practice
facilitators  who  coordinates  the  efforts  of  the  Affiliated
Practitioner's  team  and the Company.  The practice  facilitator
visits  the  Affiliated Practice monthly during  this  period  to
train  the team, install systems and programs and audit and debug
their  performance.   By  the end of the  first  12  months,  the
Affiliated  Practice generally will have completed the  following
tasks:   (i)  established  a new staff organizational  structure;
(ii)  installed  a  communication  and  marketing  system;  (iii)
installed a sophisticated scheduling system to increase treatment
productivity;  (iv) instituted a new, flexible  fee  and  payment
program;   (v)   installed  a  new  or  upgraded  financial   and
operational  reporting system; (vi) conducted staff  relationship
training; (vii) conducted initial and final patient surveys;  and
(viii) installed a patient communication and treatment completion
review program.

Agreements with Affiliated Practitioners

    The  Company  affiliates with orthodontic and other specialty
dental  practices  through a series of contractual  arrangements.
Initially, the Company and an Affiliated Practitioner enter  into
an  affiliation agreement through which the Company acquires  the
equity  interests  in  the  MSO associated  with  the  Affiliated
Practitioner's  practice.  (The Company may cause a  wholly-owned
subsidiary to acquire the equity interests in the MSO  to  reduce
adverse  tax  consequences  in certain  cases.)   The  Affiliated
Practitioner,  who  generally practices  through  and  holds  the
practice  assets  in  a professional corporation,  converts  that
entity  into  a general corporation (the MSO) and creates  a  new
professional    corporation   through   which   the    Affiliated
Practitioner continues to provide orthodontic or other  specialty
dental care (the Affiliated Practice).  The Company acquires  the
equity  interests  in  the  MSO, and the Affiliated  Practitioner
causes   the  Affiliated  Practice  to  enter  into  a  long-term
management services agreement with the Company.

      Through  the  Management Services  Agreement,  the  Company
provides  practice management and marketing services,  facilities
and  non-professional personnel to the Affiliated Practice for  a
monthly  fee.   In order to provide for an orderly transition  in
the event that the Management Services Agreement is terminated or
expires  or the Affiliated Practitioner ceases practice with  the
Affiliated  Practice,  the parties enter into  a  Stock  Put/Call
Option   and  Successor  Designation  Agreement  (the   "Put/Call
Agreement").    This   agreement  creates  for   the   Affiliated
Practitioner  certain rights and obligations  to  repurchase  the
practice  assets  held  by the Company  in  the  event  that  the
Management  Services  Agreement  is  terminated  and  grants  the
Company   certain   rights  to  designate  a   successor   dental
professional  to  purchase the stock of the  Affiliated  Practice
when   the   Affiliated  Practitioner  ceases  practice   through
retirement, death, disability or in other enumerated cases.

      Affiliation  Agreement.  The Affiliation Agreement  is  the
mechanism through which the Company acquires the equity interests
in  the MSO of the Affiliated Practice, typically in exchange for
a  combination  of cash, a promissory note and shares  of  Common
Stock  of  the Company.  The completion of the acquisition  under
the  Affiliation  Agreement  is subject  to  certain  conditions,
including,  without limitation, that there has been  no  material
adverse  change to the Affiliated Practice between the  time  the
Affiliation Agreement is signed and the transaction is closed and
that  the  Affiliated Practice and the Company have entered  into
the Management Services Agreement and the Put/Call Agreement.

      Management Services Agreement.  Pursuant to the  Management
Services Agreement, the Company  provides the Affiliated Practice
with  comprehensive management, financial and marketing  services
and  facilities,  equipment  (in the control  of  the  Affiliated
Practice,  where  required  by  statute)  and  support  personnel
required  by  the  Affiliated Practice to  operate  its  clinical
practice.  The Company maintains existing dental equipment at the
offices of the Affiliated Practice at the Company's expense  and,
after consultation with the Affiliated Practitioner and agreement
upon  the  equipment needs of the Affiliated Practice,  purchases
new equipment for use by the Affiliated Practice.  The Company is
appointed  the  sole  and  exclusive  business  manager  of   the
Affiliated   Practice.   In  addition  to  providing  facilities,
equipment  (in  the  control  of the Affiliated  Practice,  where
required by statute) and support services, the Company undertakes
all   purchasing,  payment,  billing,  collection   and   payroll
functions  for  the  Affiliated  Practice  and  facilitates   the
implementation of the Model.

      The  Affiliated Practice is solely responsible for and  has
complete control and supervision over the professional aspects of
its  practice,  as  well  as the provision  of  all  professional
services,  including, without limitation, the  selection  of  the
course of treatment for a patient, procedures or materials to  be
used  as  part  of such treatment and the manner  in  which  such
treatment  is  carried  out.  The Affiliated  Practice  has  sole
authority  to  direct  the  business,  professional  and  ethical
aspects  of  its  practice.   It makes  all  professional  hiring
decisions,  renders  patient care, and keeps all  patient  dental
records.   The  Affiliated  Practice  is  also  responsible   for
entering  into an employment agreement, including non-competition
provisions,  with  each  dental  practitioner  engaged   by   it,
including  the Affiliated Practitioner, and paying  all  salaries
for   dental  professionals,  professional  licensure  and  board
certification fees and professional liability insurance premiums.

      The  Management Services Agreement typically has an initial
term  of  twenty (20) years and is renewable for two,  successive
ten  (10) year periods.  During the initial term and any  renewal
term, the Management Services Agreement may be terminated by  the
Company  or  the  Affiliated Practice  only  for  "cause,"  which
includes  the  bankruptcy of or a material default by  the  other
party.   In  exchange  for  the performance  of  its  duties  and
obligations under the Management Services Agreement, the  Company
receives  a  monthly  management  fee.   The  fee,  which  varies
somewhat  from practice to practice, is generally 65% to  75%  of
the Affiliated Practice's gross collections for the period.  From
the  monthly  fee,  the  Company pays  all  of  its  expenses  in
providing services to the Affiliated Practice, including, without
limitation, the salaries and benefits of the Company's employees,
the   costs   of  any  consultants,  corporate  overhead,   lease
obligations  and taxes.  In the event that the gross  collections
of  an Affiliated Practice in a given month are not sufficient to
pay  the  entire  amount of salaries, benefits and  other  direct
costs  payable  by  the  Affiliated Practice  and  the  Company's
monthly  fee  for  such  month, the  Company  anticipates  making
routine   advances  to  the  Affiliated  Practice  to  fund   any
shortfalls  for  such  month.  Such advances  will  generally  be
repaid by the Affiliated Practice to the Company without interest
as  adequate  funds are generated by the Affiliated  Practice  in
subsequent months.

      Put/Call  Agreement.   The Put/Call Agreement  governs  the
dissolution  of  the affiliation between the Affiliated  Practice
and the Company, whether caused by a termination or expiration of
the Management Services Agreement or as a result of the cessation
of  practice by the Affiliated Practitioner.  In the  case  of  a
termination  or expiration of the Management Services  Agreement,
the  Affiliated Practice may be required to repurchase the assets
of   the   MSO   utilized  in  the  practice  of  the  Affiliated
Practitioner as set forth on the MSO's balance sheet  as  at  the
end   of  the  month  immediately  preceding  the  date  of  such
termination (when the termination is initiated by the Company) or
may   have  the  right  to  repurchase  such  assets  (when   the
termination  is  initiated  by the  Affiliated  Practice).   Such
assets  typically will include leasehold improvements,  fixtures,
furniture,   furnishings,  equipment,  inventory,  supplies   and
intangibles.   In  the  event  that  the  Company  initiates  the
termination, the Affiliated Practice is typically required to pay
book  value  for the assets as shown on the MSO's balance  sheet,
and,   in  the  event  the  Affiliated  Practice  initiates   the
termination, the Company is typically required to pay  an  amount
equal to the sum of (a) the amount of cash paid to the Affiliated
Practitioner  by  the  Company under the  Affiliation  Agreement,
(b) the original principal amount of the Promissory Note (if any)
issued  by  the Company to the Affiliated Practitioner under  the
Affiliation Agreement, and (c) the value of that number of shares
of  Common Stock issued to the Affiliated Practitioner under  the
Affiliation Agreement, such value to be determined by multiplying
such  number  of  shares by the average last sales  (or  closing)
price  for  the  Company's Common Stock on the NASDAQ  Small  Cap
Market for each of the 60 trading days immediately preceding  the
date  the  notice  of the Affiliated Practice's determination  to
repurchase  such  assets is delivered to the Company.   When  the
Affiliated  Practitioner ceases practicing  with  the  Affiliated
Practice, whether as a result of retirement, death, disability or
other reason, the Company typically has the option to designate a
successor  practitioner to purchase the Affiliated Practice  from
the   Affiliated  Practitioner  in  order  to  ensure  that   the
Affiliated  Practice  continues to operate  and  to  perform  its
obligations under the Management Services Agreement.  The Company
may  choose  not  to  exercise this option where  the  Affiliated
Practitioner proposes to sell the Affiliated Practice to  another
practitioner  previously  approved  by  the  Company  to  be  the
Affiliated  Practitioner's successor  in  the  ownership  of  the
Affiliated Practice.

Competition

      The  business of providing orthodontic services  is  highly
competitive in each of the markets in which the Company operates.
Each of the Company's Affiliated Practices faces competition from
orthodontists  who maintain single offices or  operate  a  single
satellite  office,  as well as from orthodontists  that  maintain
group  practices or operate in multiple offices.  The  Affiliated
Practices   also  compete  with  dentists  who  provide   certain
orthodontic  services.  The provision of orthodontic services  by
such dentists has increased in recent years.

      At  this  time, the Company believes that there  are  three
publicly-traded companies, Orthodontic Centers of America,  Inc.,
Apple   Orthodontix,  Inc.  and  OrthAlliance,   Inc.,   actively
competing in the orthodontic practice management market and  that
there  are  several other companies participating in the  market.
These three competitors and the other companies are significantly
larger  and have greater financial, marketing and other resources
than  the  Company.  The Company will compete  with  these  three
companies  and  other  companies  both  for  expansion  into  new
affiliate  practices  and  for  patients.   Management,  however,
believes  the Company appeals to that segment of the  orthodontic
market  that relies primarily on traditional patient and  general
dentist  referrals  to generate new business  while  these  three
competitors  and other companies appeal to that  segment  of  the
orthodontic market that relies primarily on advertising  and  low
fees to attract patients who would not otherwise seek orthodontic
treatment.

     In addition, there are several companies pursuing strategies
similar  to  the  Company in other segments of  the  health  care
industry  and  additional companies with similar  objectives  may
enter the Company's markets and compete with the Company.   If  a
great  number  of  competitors  enter  the  orthodontic  practice
management  market,  it  could drive up  the  purchase  price  of
orthodontic   practices  adversely  and  affect   the   Company's
expansion  strategy.  There can be no assurance that the  Company
will be able to compete effectively.

Government Regulation

      The fields of orthodontics and other dental specialties are
highly  regulated,  and  there  can  be  no  assurance  that  the
regulatory  environment in which the Company  operates  will  not
change  significantly in the future.  In general,  regulation  of
health care companies is increasing.

      Every state imposes licensing requirements on orthodontists
and  other  dental  specialists and on  facilities  and  services
operated  by them.  In addition, federal and state laws  regulate
health   maintenance   organizations  and  other   managed   care
organizations   for   which  orthodontists   and   other   dental
specialists may be providers.  In connection with the entry  into
new  markets,  the  Company and its Affiliated Practitioners  may
become subject to compliance with additional regulations.

      The  operations  of  the  Affiliated  Practices  must  meet
federal,  state and local regulatory standards in  the  areas  of
safety  and health.  Based on its familiarity with the operations
of   its  current Affiliated Practices and the activities of  the
Affiliated Practitioners, management believes that its Affiliated
Practices  are  in compliance in all material respects  with  all
applicable federal, state and local laws and regulations.

      The  laws  of many states prohibit orthodontists and  other
dental   specialists   from  splitting   fees   with   non-dental
specialists  and  prohibit  non-dental  entities  (such  as   the
Company)  from practicing dentistry, including orthodontics,  and
from  employing  orthodontists, other dental specialists  or,  in
certain  circumstances,  orthodontic and other  dental  specialty
assistants.   The  laws  of some states prohibit  advertising  of
orthodontic and other dental specialty services under a trade  or
corporate name and require that all advertising be in the name of
the  orthodontist or dental specialist.  A number of states  also
regulate  the content of advertisement of orthodontic  and  other
dental  specialty services and the use of promotional gift items.
A number of states limit the ability of a non-licensed dentist to
own  equipment or offices used in an orthodontic or other  dental
specialty  practice.   Some  of these  states  allow  leasing  of
equipment  and  office space to an orthodontic  or  other  dental
specialty practice, under a bona-fide lease, if the equipment and
office   remain  in  the  complete  care  and  custody   of   the
orthodontist  or  other dental specialist.  Management  believes,
based  on  its  familiarity with the operations of   its  current
Affiliated  Practices, the activities of the Company's Affiliated
Practitioners and the applicable regulations, that the  Company's
current  and planned activities do not constitute the  prohibited
practices contemplated by these statutes and regulations.   There
can be no assurance, however, that future interpretations of such
laws,  or the enactment of more stringent laws, will not  require
structural  and  organizational modifications  of  the  Company's
existing relationships with its Affiliated Practitioners  or  the
operation of the Affiliated Practices.  In addition, statutes  in
some  states  could restrict expansion of Company  operations  in
those jurisdictions.

      The  Company regularly monitors developments  in  laws  and
regulations  relating to dentistry.  The Company may be  required
to  modify its agreements, operations and marketing from time  to
time  in  response  to  changes in the  business  and  regulatory
environment.   The  Company  plans  to  structure  all   of   its
agreements,   operations  and  marketing   in   accordance   with
applicable  law,  although there can be  no  assurance  that  its
arrangements will not be successfully challenged or that required
changes may not affect operations or profitability.

Employees

      At   December  31,  1997, the Company had approximately  74
employees and utilized a number independent contractors to assist
with  certain  corporate  functions  and  to  provide  consulting
services  to  the  Affiliated Practices.  None of  the  Company's
employees  are represented by a collective bargaining  agreement.
The  Company considers its relationship with its employees to  be
satisfactory.

Insurance

      The  provision  of orthodontic and other  dental  specialty
services entails an inherent risk of professional malpractice and
other similar claims.  Although the Company does not influence or
control the practice of dentistry by the Affiliated Practitioners
or have responsibility for compliance with certain regulatory and
other   requirements  directly  applicable  to   the   Affiliated
Practices,  the contractual relationship between the Company  and
the  Affiliated  Practices may subject  the  Company  to  medical
malpractice  actions.   There can be no  assurance  that  claims,
suits or complaints relating to services and products provided by
Affiliated Practices will not be asserted against the Company  in
the  future.  The availability and cost of professional liability
insurance has been affected by various factors, many of which are
beyond the control of the Company.  The cost of such insurance to
the  Affiliated  Practices  may have an  adverse  effect  on  the
Company's operations.

      The  Management Services Agreements require the  Affiliated
Practices  to maintain, at their expense, professional  liability
insurance  for themselves and each orthodontist or  other  dental
specialist   employed  by  or  otherwise  providing  professional
services  for  the Affiliated Practice in the minimum  amount  of
$500,000  per  occurrence and $1,000,000 in  the  aggregate.   In
addition, each Affiliated Practice will undertake to comply  with
all applicable regulations and requirements, and the Company will
be  indemnified  under  the Management  Services  Agreements  for
claims against the Company arising in connection with actions  by
the  Affiliated  Practices.  The Company has   general  liability
insurance  for  itself  and  requires that  it  be  named  as  an
additional insured party on the professional liability  insurance
policies  of the Affiliated Practices pursuant to the  Management
Services  Agreement.  The Company does not maintain  professional
liability insurance for itself.

      The  Company maintains other insurance coverage's including
property,  workers'  compensation  and  directors  and   officers
liability insurance which management considers to be adequate for
the size of the Company and the nature of its business.

Item 2.  Description of Property

    The Company leases facilities, under various operating leases
which  expire  through  October 2017, for  each  of  its  current
Affiliated  Practices.  The Company subleases  office  space  and
maintain its financial records in Massachusetts.

Item 3.  Legal Proceedings

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

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

   None

                             PART II

Item 5.  Market for Common Equity and Related Stockholder Matters

(a)    Market Information

  The Company's Common Stock and Redeemable Common Stock Purchase
Warrants are traded on The Nasdaq Stock Market  ("Nasdaq")  under
the symbols ''ORTH'' and "ORTHW," respectively.  Prior to October
1,  1997, there was no public market for the Common Stock or  the
Redeemable  Common Stock Purchase Warrants.  The following  table
sets  forth the high and low bid quotation information by quarter
for  each  of  the Common Stock and the Redeemable  Common  Stock
Purchase  Warrants.,  as  reported  on  Nasdaq.   The  quotations
reflect inter-dealer prices, without retail mark-up, mark-down or
commission, and may not represent actual transactions.

                                High        Low
Fourth Quarter, 1997                    
  Common Stock                          
                              $6.25       $2.87
  Warrants                     1.75         .50


(b)    Holders

    As  of February 27, 1998, there were approximately 39 holders
of  record of the Common Stock and two holders of record  of  the
Redeemable Common Stock Purchase Warrants.   The Company believes
that  the number of beneficial owners of the Common Stock and  of
the  Common  Stock Purchase Warrants, respectively, is,  in  each
case, substantially in excess of the number of record holders.

(c)    Dividends

   The Company has never declared or paid dividends on its Common
Stock.  The Company expects that future earnings, if any, will be
retained for the growth and development of the Company's business
and,  accordingly,  the  Company does  not  anticipate  that  any
dividends  will be declared or paid on the Common Stock  for  the
foreseeable  future.   The declaration,  payment  and  amount  of
future  dividends, if any, will depend upon the future  earnings,
results   of   operations,   financial   position   and   capital
requirements of the Company, among other factors.

(d)    Recent Sales of Unregistered Securities

    During  the  year ended December 31, 1997, the  Company  sold
equity   securities   in   the  following  transactions   without
registration  under  the  Securities Act  in  reliance  upon  the
exemption  from  registration set forth in Section  4(2)  of  the
Securities   Act  and  the  rules  and  regulations   promulgated
thereunder:

    During February and April 1997, the Company privately  placed
$300,000  of  its 15% Senior Notes due September  30,  1997  (the
"Bridge Notes") along with 60,000 shares of its Common Stock with
a  group  of  "accredited investors," as that term is defined  in
Rule  501  promulgated  under  the  Securities  Act.   The  total
consideration  received by the Company for these  securities  was
$300,000.   The Company relied on Section 4(2) of the  Securities
Act  and  the  rules  and regulations promulgated  thereunder  in
issuing   these   securities  without  registration   under   the
Securities Act.

    Pursuant  to  an  agreement among the Company,  Dr.  C.  Joel
Glovsky, the Chairman of the Board, and The Mayflower Group, Ltd.
("Mayflower"), a private banking firm and a holder of  in  excess
of  five  percent  of  the membership points of  The  Orthodontic
Management  Effectiveness Group of America, LLC  ("OMEGA,  LLC"),
the principal stockholder of the Company, as amended and restated
in  April  1997, the Company issued 225,000 shares of its  Common
Stock   to   each  of  Dr.  Glovsky  and  Mayflower  in   partial
consideration  of  certain consulting services  rendered  by  Dr.
Glovsky  and Mayflower to the Company.  Such consulting  services
had  a  deemed value of approximately $2.0 million.  Dr. Glovsky,
as the Chairman of the Board of the Company, and Mayflower, as  a
principal  point holder of OMEGA, LLC, the principal  stockholder
of  the  Company,  had  access  to  information  on  the  Company
necessary  to make an informed investment decision.  The  Company
relied  on  Section 4(2) of the Securities Act and the rules  and
regulations  promulgated thereunder in issuing  these  securities
without registration under the Securities Act.

    In April 1997, the Company issued 10,000 shares of its Common
Stock  to  Leonard, Mulherin & Greene, P.C., a public  accounting
firm  ("LMG"),  in  partial consideration for  $50,000  worth  of
consulting  services  provided by LMG to  the  Company.   Omega's
Chief  Financial  Officer  is  a principal  stockholder  of  LMG.
Accordingly, LMG, through one of its principal stockholders,  had
access  to  information  on  the Company  necessary  to  make  an
informed investment decision.  The Company relied on Section 4(2)
of  the  Securities Act and the rules and regulations promulgated
thereunder in issuing these securities without registration under
the Securities Act.

    In  October 1997, simultaneously with the closing of its IPO,
the  Company issued an aggregate of 465,314 shares of its  Common
Stock  to  six  of the seven initial Affiliated Practitioners  as
partial  consideration  for  their  affiliation  with  those  six
Affiliated  Practitioners and granted an option  to  the  seventh
Affiliated Practitioner to acquire 83,333 shares of the Company's
Common  Stock an at exercise price of $6.00 per share as  partial
consideration  for  such  affiliation.   The  Company  relied  on
Section  4(2) of the Securities Act and the rules and regulations
promulgated  thereunder  in  issuing  these  securities   without
registration under the Securities Act.

    In  December 1997, the Company issued an aggregate of 118,509
shares  of  its  Common Stock to two Affiliated Practitioners  as
partial   consideration  for  the  affiliation  with  those   two
Affiliated Practitioners.  The Company relied on Section 4(2)  of
the  Securities  Act  and  the rules and regulations  promulgated
thereunder in issuing these securities without registration under
the Securities Act.

(e)    Use of Proceeds from Registered Securities

     The   Company's   Registration  Statement   on   Form   SB-2
(Registration  No. 333-27179), as amended, with  respect  to  the
offering  of  shares  of the Common Stock and  Redeemable  Common
Stock  Purchase  Warrants  in  the  Company's  IPO  was  declared
effective on September 30, 1997.  The IPO commenced on October 1,
1997  and has since terminated, resulting in (i) the sale by  the
Company  of 2,070,000 shares of Common Stock on October  6,  1997
(including  270,000 shares of Common Stock sold pursuant  to  the
exercise  of the underwriters' over-allotment option on the  same
date)  and  (ii) the sale by the Company of 2,070,000  Redeemable
Common  Stock  Purchase Warrants on October  6,  1997  (including
270,000  Redeemable Common Stock Purchase Warrants sold  pursuant
to the exercise of the underwriters' over-allotment option on the
same date).  The shares of Common Stock and the Redeemable Common
Stock Purchase Warrants sold constituted all the shares of Common
Stock  and  all  the  Redeemable Common Stock  Purchase  Warrants
covered  by the Registration Statement and available for sale  to
the  public in the IPO.  The managing underwriter for the IPO was
National  Securities  Corporation.  The aggregate  price  to  the
public  for the shares of Common Stock and the Redeemable  Common
Stock  Purchase Warrants sold in the IPO was $12.6 million.   The
Company  incurred total expenses of $3.1 million, including  $1.3
million  in  underwriting discount and commissions  paid  by  the
Company and $1.8 million in other expenses.  The amount of  other
expenses is a reasonable estimate of such amount.  None  of  such
payments  was  a  direct  or indirect  payment  to  directors  or
officers  of  the Company or their associates, to persons  owning
10%  or more of any class of equity securities of the Company  or
to affiliates of the Company.

  The net proceeds to the Company from the IPO were $9.5 million.
The  Company used such net proceeds as follows: (i) $1.1  million
for  the  repayment of debt; (ii) $2.1 million to consummate  the
affiliations  with  the seven initial Affiliated  Practices  (the
"Initial  Affiliated  Practices"); (iii) $433,000  to  consummate
affiliations  with  additional  Affiliated  Practices;  and  (iv)
$450,000 for working capital and other corporate purposes.   None
of such payments was a direct or indirect payment to directors or
officers  of  the Company or their associates, to persons  owning
10%  or more of any class of equity securities of the Company  or
to  affiliates  of  the  Company, except  (a)  $115,000  of  debt
repayments were paid to Dr. Glovsky, the Chairman of the Board of
the Company; (b) $50,000 of debt repayments were paid to Dr. Dean
C.  Bellavia,  a  director of the Company; (c)  $50,000  of  debt
repayments  were  paid to Dr. David T. Grove, a director  of  the
Company,   and  $333,567  was  paid  to  Dr.  Grove  as   partial
consideration  for acquiring certain assets of  his  practice  in
connection  with  the  consummation of the affiliation  with  his
Affiliated  Practice; and (d) $100,000 was loaned  to  Robert  J.
Schulhof,  the  President  and Chief  Executive  Officer  of  the
Company,  to  assist him in repaying certain personal obligations
which he incurred during the start up of the Company.

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

General

     Omega was incorporated in Delaware in August 1996. Following
its IPO on October 6, 1997,  the Company  began to offer its
services primarily under an affiliate relationship whereby it
purchases the equity interests in an orthodontic practice's MSO
pursuant to an Affiliation Agreement and enters into a long term
Management Services Agreement with the Affiliated Practitioner's
Affiliated Practice.  Pursuant to the Management Services
Agreement, the Company  receives a monthly management fee for
providing all of the Affiliated Practice's practice needs,
including facilities, support staff and supplies, as well as a
program of systems, methods and procedures designed to enhance
the growth, efficiency and profitability of the Affiliated
Practice.

     Pursuant to the Affiliation Agreement, the Affiliated
Practitioner typically converts his existing professional
corporation into a general corporation that will function as the
MSO and creates a new professional corporation (the Affiliated
Practice) through which the Affiliated Practitioner will continue
to provide orthodontic care.  The MSO  retains certain assets and
liabilities which typically include the lease for the Affiliated
Practice's office space, clinical supplies and equipment and
office furniture, supplies and equipment.  The Affiliated
Practice will retain certain other assets and liabilities (if
any) which  typically include all cash and cash equivalents, real
property, automobiles, patient records, related patient
information and notes payable unrelated to assets purchased.  The
Company  generally acquires all of the equity interests of the
MSO from the Affiliated Practitioner, the purchase price for
which is determined through an assessment of immediate and future
return on investment.  The MSO typically is acquired for a
combination of cash,  notes and unregistered Common Stock or
stock options.  The average MSO purchase price is  approximately
$600,000, of which the cash portion is  approximately $200,000.

       The  Management  Services  Agreement  provides  that   the
Affiliated  Practice will utilize the facility and the  Company's
services  for a period of 20 years, with two ten year extensions.
While  each Management Services Agreement is negotiated based  on
specific  circumstances, the management  fees  charged  typically
range  between  be 65% to 75% of the Affiliated Practice's  gross
income,  which  is expected to be sufficient to pay  all  of  the
MSO's  expenses and provide a return on the Company's investment.
If the Affiliated Practice's expenses payable by the MSO are less
than  an agreed target amount of expenses, the difference between
the  target  amount  and the actual expenses  will  typically  be
shared  equally by the MSO and the Affiliated Practice.   At  the
retirement,  disability or death of the Affiliated  Practitioner,
the  Company  will identify a replacement Affiliated Practitioner
to  purchase  the Affiliated Practice and assume  the  Management
Services Agreement.

      Concurrent  with the IPO, the Company executed  Affiliation
Agreements with seven  Initial Affiliated Practices. In addition,
between  October  and December 31,1997 the Company  entered  into
Affiliation Agreements with two additional Affiliated  Practices.
Pursuant  to  those collective agreements, the Company   acquired
the   equity  interests  in  the  MSOs  of  all  nine  Affiliated
Practices. Each of the Affiliated Practices is operated with  one
practitioner,  who is typically supported by  a  staff  of  three
dental assistants and three office personnel. Gross revenues  for
each  Affiliated  Practice for the year ended December  31,  1996
ranged  from  a  low  of  approximately $390,000  to  a  high  of
approximately $975,000.

      In  consideration for acquiring the MSOs, the Company  paid
the  aggregate of approximately $2.2 million in cash,  issued  an
aggregate of approximately $441,000 in notes bearing interest  at
8.5%,  assumed  $973,973 of liabilities, issued an  aggregate  of
583,823  shares  of  Common   and  granted   options  to  acquire
83,333 shares of Common Stock.

      The  Company expects that its future growth will come  from
implementing  its  Model with Affiliated Practices  and  entering
into  Affiliation Agreements with new Affiliated Practices.   The
ability of the Company to achieve its expansion will depend  upon
a  number  of  factors,  including (i) the Company's  ability  to
attract  orthodontic  and other dental specialists  to  affiliate
with  the Company, (ii) the availability of suitable markets  and
the  Company's ability to obtain suitable locations within  those
markets; (iii) the Company's ability to locate existing practices
for affiliation, affiliate with such practices on favorable terms
and  successfully  integrate the affiliated operations  into  the
Company's  existing  operations; and  (iv)  the  availability  of
adequate  financing  to  fund affiliations with  orthodontic  and
other  dental  specialty  practices.   A  shortage  of  available
orthodontists  and other dental specialists with the  skills  and
experience required by the Company would have a material  adverse
effect  on  the  Company's expansion  plans.   There  can  be  no
assurance   that  the  Company's  expansion  strategy   will   be
successful, that modifications to the Company's strategy will not
be   required  or  that  the  Company  will  be  able  to  manage
effectively  and  enhance  the profitability  of  its  Affiliated
Practices.

     The value assigned to the Management Services Agreement with
the  acquisition of the assets and liabilities  of  the  MSO  and
concurrent  Management  Services Agreement  with  the  Affiliated
Practices   has  been accounted for by the Company in  accordance
with   the  Emerging  Issues  Task  Force  ("EITF")  Issue  97-2.
Substantially  all  of the  intangible assets  on  the  Company's
consolidated balance sheet as of December 31, 1997 are related to
the  affiliation  with  the Affiliated  Practices.   The  Company
evaluates   each  affiliation  and  establishes  an   appropriate
amortization   period   based  on  the   underlying   facts   and
circumstances.   Currently,  the  Company  uses  an  amortization
period  ranging from 25 to 40 years, consistent with the extended
terms of the Management Services Agreements.  Subsequent to  each
acquisition, the Company reevaluates such facts and circumstances
to  determine  if the related intangible assets  continue  to  be
realizable  and  if  the  amortization  period  continues  to  be
appropriate.

      Amortization  of  the intangible assets  on  the  Company's
consolidated balance sheet as of December 31, 1997   produced  an
amortization expense of approximately $35,000.  Affiliations with
additional Affiliated Practices will result in the recognition of
additional  intangible assets and will cause amortization expense
to  increase  further.  Although the net unamortized  balance  of
intangible assets on the Company's  consolidated balance sheet as
of  December  31,  1997 was not considered to  be  impaired,  any
future  determination that a significant impairment has  occurred
would   require  the  write-off  of  the  impaired   portion   of
unamortized  intangible  assets , which  would  have  a  material
adverse effect on the Company's business, financial condition and
results of operations.

 Results of Operations

      For  the  year ended December 31, 1997 and the period  from
inception (August 30, 1996) through December 31, 1996.

Revenues

     Prior  to the Company's IPO, on October 6, 1997, the Company
provided  management consulting services to Orthodontic practices
on  a  fee  for service basis.  Management consulting  fees  were
approximately $43,000 for the period from inception  (August  30,
1996) through December 31, 1996 and approximately $58,000 for the
year ended December 31, 1997 and are reflected as consulting  fee
revenue  in the accompanying statements of operations.  Following
the  completion  of  the  IPO on October  6,  1997,  the  Company
completed   its affiliations with seven Affiliated Practices  and
generated service fee revenue of approximately $918,000  for  the
year  ended December 31, 1997.  In addition,  between October  1,
1997  and  December  31, 1997,  the Company affiliated  with  two
additional  practices on an interim management  agreement  basis.
Under the terms of the interim management agreements, the Company
receives  service  fee revenue for providing management  services
which  are essentially the same as management service fees earned
upon  consummation  of  a formal Management  Services  Agreement.
Accordingly,  service fee revenue reflects only three  months  of
operations  during the year ended December 31, 1997.  There  were
no service fee revenues for the period from inception (August 30,
1996) to December 31, 1996.
          
Cost and Expenses

     The  Company  incurred  operating  costs  and  expenses   of
approximately $4.5 million for the year ended December 31,  1997.
The  Company's costs and expenses consist primarily  of  salaries
and   benefits,  orthodontic  supplies,  rent,  advertising   and
marketing,  general  and  administrative  and  depreciation   and
amortization. The Company incurred operating costs  and  expenses
of  approximately  $248,000 for 1996 which represented  corporate
office  expense  and  the cost  of providing  certain  management
consulting  services  for the period from inception  (August  30,
1996)  through December 31, 1996.  Of the $4.5 million  of  costs
and  expenses for the year ended December 31, 1997, approximately
$2.3  million  relates to the value ascribed to stock  and  stock
options  issued  to advisors of the Company in  April  1997,  and
$305,000  relates  to  cash  payments  to  be  made  in  1998  in
connection  with those stock grants.  The Company  also  incurred
various legal, accounting, travel, personnel and marketing  costs
during  the  period  from  inception (August  30,  1996)  through
December 31, 1996 in connection with the IPO and the affiliations
with the  Affiliated Practices.  The Company's costs and expenses
include:
     
     Employee  Costs.  Includes all salaries, payroll  taxes  and
     fringe  benefits of the dental assistants, office staff  and
     corporate office personnel.
     
     Other  Direct  Costs.  Includes dental and office  supplies,
     laboratory   costs,   facilities  and  equipment   for   the
     Affiliated Practices and corporate office.
     
     General  and  Administrative.  Includes all other  operating
     expenses,  including advertising, repairs  and  maintenance,
     computer  support, telephone, utilities, taxes and  licenses
     for  the Affiliated Practices and corporate office, as  well
     as  the  cost of consultants, professional fees  and  travel
     related to providing support to the Affiliated Practices and
     corporate office.
     
     Depreciation  and  Amortization.  Includes  depreciation  of
     equipment  and  leasehold  improvements  of  the  Affiliated
     Practices  and amortization of intangible assets related  to
     the Management Services Agreements.
     
     Non-recurring  Consulting Expense.  Relates to approximately
     $2.3  million  value  ascribed to stock  and  stock  options
     issued to advisors of the Company in April 1997 and $305,000
     relates  to  cash payments to be made in 1998 in  connection
     with those stock grants.

Interest Expense

     Interest  expense  of approximately $149,000  for  the  year
ended  December  31, 1997 reflected the cost of borrowings  under
interim  and  bridge  financing  used  to  finance  the  cost  of
operations and IPO costs.  These notes were paid in full  with  a
portion  of  the  proceeds  of the IPO.   In  addition,  interest
expense includes notes payable to Affiliated Practices issued  as
part  of the purchase price of those practices.  Interest expense
of  approximately  $30,000 for the period from inception  (August
30,  1996)  to  December 31, 1996 reflects the cost of  borrowing
under bridge financing outstanding at that time.



Interest Income

     Interest income of approximately $79,000 for the year  ended
December 31, 1997 reflected interest earned on the Company's  net
proceeds from the IPO.  Interest income of $2,000 for the  period
from  inception (August 30 ,1996) to December 31, 1996  reflected
interest  earned on the net proceeds of the bridge  notes  issued
during 1996.

Net Loss

     As  a result of the foregoing factors, the Company generated
a net loss of approximately $3.6 million, or $1.59 per share, for
the  year  ended  December  31,  1997,  versus  a  net  loss   of
approximately $232,000, or $0.14 per share, for 1996.

Liquidity and Capital Resources

Financing Activities

      The  Company has financed its capital requirements to  date
with borrowings from bridge and interim notes and the issuance of
equity securities.

      Omega  has experienced net losses, negative cash  flows,  a
deficit  in working capital and an accumulated deficit since  its
inception.   The  Company's accumulated a deficit from  inception
(August  30,  1996)  to October 1, 1997 (the Company's  IPO)  was
approximately  $3.3 million.  The Company reported a  significant
loss  from  operations for the year ended December 31,  1997  due
primarily  to  the  value ascribed to certain stock  compensation
earned  by  consultants in April 1997.  At December 31,1997,  the
Company   had   an   accumulated  deficit  since   inception   of
approximately $3.9 million.

      The  Company  makes routine cash advances from time to time
to   its  Affiliated  Practices  under  its  Management  Services
Agreements  to  fund any deficits in monthly cash  flows  of  the
Affiliated Practices.  Such advances will generally be repaid  by
the  Affiliated  Practices  to the Company  without  interest  as
adequate funds are generated by the Affiliated Practices.

       The  Company's  expansion  strategy  requires  substantial
capital   resources.   Capital  is  needed  not  only   for   the
affiliation  with future Affiliate Practices, but  also  for  the
effective  integration, operation and expansion of  the  existing
and  future  Affiliated Practices.  In addition,  the  Affiliated
Practices  may  from time to time require capital for  renovation
and  expansion and for the addition of equipment and  technology.
The  extent to which the Company is able or willing to use shares
of  Common  Stock  to enter into future affiliations  or  provide
future  financing will depend on the market value of  the  Common
Stock  from  time  to time and, in the case of affiliations,  the
willingness of owners of potential Affiliated Practices to accept
Common  Stock  as  full or partial payment of  consideration  for
their  affiliations.   Using shares of  Common  Stock  for  these
purposes   may  result  in  significant  dilution   to   existing
stockholders.  The Company will require additional  capital  from
outside  financing  sources in order to  continue  its  expansion
program.  There can be no assurance that the Company will be able
to  obtain additional funds when  needed on satisfactory terms or
at  all.   Any  limitation  on the Company's  ability  to  obtain
additional financing could have a material adverse effect on  the
Company's   business,   financial  condition   and   results   of
operations.

Business Development

      The  Company's business development program  also  requires
significant  amounts of capital.  The amount of  cash  needed  to
attract new Affiliated Practices, particularly the amount  to  be
used in any given period, depends on a number of factors, many of
which  are beyond the Company's control.  The Company anticipates
the  use of a combination of cash, notes and shares of its Common
Stock to fund such additional affiliations, the Company will  use
cash  flows from operations, net proceeds from its IPO  and  will
seek  to  raise  capital through bank borrowings  and  public  or
private  debt  or  equity issuances.  The availability  of  these
capital  sources  will  depend on prevailing  market  conditions,
interest  rates  and  the  financial condition  of  the  Company.
During  the  year  ended  December 31, 1997,  the  Company  spent
approximately  $2.2  million of cash, issued  583,823  shares  of
Common  Stock  and  granted options to acquire 83,333  shares  of
Common  Stock  in  connection with affiliations  with  Affiliated
Practices.

Working Capital Management

      The Company had $4.7 million of working capital at December
31,  1997,  consisting primarily of cash and cash equivalents  of
approximately  $5.4  million  as a result  of  the  net  proceeds
remaining from the IPO.

Safe Harbor Statement under the Private Securities Litigation
Reform Act of 1995

     Forward-looking statements in this report, including without
limitation, statements relating to the Company's plans,
strategies, objectives, expectations, intentions and adequacy of
resources, are made pursuant to the safe harbor provisions of the
Private Securities Litigation Reform Act of 1995.

     The forward-looking statements included herein are based on
current expectations that involve numerous risks and
uncertainties.  The Company's plans and objectives are based on a
successful execution of the Company's expansion strategy and
assumptions that the Affiliated Practices will be profitable,
that the orthodontic industry will not change materially or
adversely, and that there will be no unanticipated material
adverse change in the Company's operations or business.
Assumptions relating to the foregoing involve judgments with
respect to, among other things, future economic, competitive and
market conditions and future business decisions, all of which are
difficult or impossible to predict accurately and many of which
are beyond the control of the Company.  Although the Company
believes that its assumptions underlying the forward-looking
statements are reasonable, any of the assumptions could prove
inaccurate and, therefore, there can be no assurance that the
forward-looking statements included in this Report will prove to
be accurate.  In light of the significant uncertainties inherent
in the forward-looking statements included herein, particularly
in view of the Company's early stage of operations, the inclusion
of such information should not be regarded as a representation by
the Company or any other person that the objectives and plans of
the Company will be achieved.

Item 7.  Financial Statements


                    Omega Orthodontics, Inc.
               Consolidated Financial Statements

                             Index


Consolidated Financial Statements:

     Reports of Independent Auditors                         F-1

     Consolidated Balance Sheets                             F-3

     Consolidated Statements of Operations                   F-5

     Consolidated Statements of Stockholders' Equity (Deficit)F-6

     Consolidated Statements of Cash Flows                   F-7

     Notes to Consolidated Financial Statements              F-9









            REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To Omega Orthodontics, Inc.:

We  have  audited the accompanying consolidated balance sheet  of
Omega   Orthodontics,   Inc.   (a   Delaware   corporation)   and
subsidiaries   as   of  December  31,  1997,  and   the   related
consolidated  statements  of  operations,  stockholders'   equity
(deficit)  and  cash  flows  for  the  year  then  ended.   These
consolidated financial statements are the responsibility  of  the
Company's  management.   Our  responsibility  is  to  express  an
opinion on these financial statements based on our audit.

We  conducted  our  audit in accordance with  generally  accepted
auditing  standards.  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 audit provides a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to
above  present  fairly, in all material respects,  the  financial
position  of  Omega  Orthodontics, Inc. and  subsidiaries  as  of
December 31, 1997, and the results of their operations and  their
cash  flows for the year then ended, in conformity with generally
accepted accounting principles.



Boston, Massachusetts                        /s/ Arthur Andersen LLP
March 19, 1998







            REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To Omega Orthodontics, Inc.:

We   have  audited  the  accompanying  balance  sheet  of   Omega
Orthodontics, Inc. (the Company) as of December 31, 1996 and  the
related statements of operations, stockholders deficit, and  cash
flows for the period from August 30, 1996 (inception) to December
31,  1996.  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 audit.

We  conducted  our  audit in accordance with  generally  accepted
auditing  standards.  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 audit provides 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  Omega  Orthodontics, Inc. as of December 31,  1996,  and  the
results  of  its  operations and its cash flows for  the  initial
period   then   ended  in  conformity  with  generally   accepted
accounting principles.

The accompanying financial statements have been prepared assuming
that  the Company will continue as a going concern.  As discussed
in  Note  1, the Company has an accumulated deficit of  $232,112,
and  a  working  capital deficiency of $368,032 at  December  31,
1996.   These  conditions  raise  substantial  doubt  about   the
Company's  ability to continue as a going concern.   Management's
plans  in regard to these matters are also described in  Note  1.
The  financial  statements  do not  include  any  adjustments  to
reflect  the  possible future effects on the  recoverability  and
classification  of  assets or the amounts and  classification  of
liabilities that may result from the outcome of this uncertainty.



Boston,  Massachusetts                      /s/ Ernst & Young LLP
March 7, 1997

                    Omega Orthodontics, Inc.
                  Consolidated Balance Sheets

                                                        December 31,
                                                     1997            1996
ASSETS

Current assets:
  Cash  and  cash equivalents                        $  5,421,721  $ 321,057
  Receivable from affiliated practices, net of
     allowance  of $5,700 in  1996                        926,271     18,296
  Notes  receivable from affiliated  practice              50,000          -
  Notes  and  interest receivable from related  parties   120,859          -
  Prepaid expenses                                         55,791      4,000
     Total  current assets                              6,574,642    343,353

Property  and equipment, at cost, net                     503,339     10,096
Due  from  affiliated  practices                           53,194          -
Intangible assets, net of accumulated amortization of
  $35,145 in 1997                                       5,099,043          -
Other assets                                               80,303    137,474

     Total  assets                                    $12,310,521  $ 490,923

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

                    Omega Orthodontics, Inc.
                  Consolidated Balance Sheets
                          (Continued)
                                                             December 31,
                                                          1997            1996

LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)

Current liabilities:
  Accounts  payable                                  $    155,671     $ 21,234
  Accrued   expenses                                      354,513       88,115
  Patient   prepayments                                   775,699            -
  Current portion of long-term  debt                       76,130      575,000
  Due  to  affiliated  practices                          147,955            -
  Due  to related parties                                 305,000       27,036

     Total  current liabilities                         1,814,968      711,385

Long-term  debt,  less current  portion                   468,551            -

     Total  liabilities                                 2,283,519      711,385

Commitments and contingencies (Note 12)

Stockholders' equity (deficit):
  Preferred stock, $.01 par value per share; 500,000
   shares  authorized;  no  shares  issued                      -            -
  Common stock, $.01 par value per share; 9,500,000
   shares authorized; 4,338,823 and 1,615,000 shares
   outstanding at December 31, 1997 and 1996,
   respectively                                            43,388       16,150
Additional paid-in capital                             13,858,851            -
Accumulated deficit                                  (  3,875,237)   ( 232,112)
Deferred compensation                                          -        (4,500)
     Total stockholders' equity (deficit)              10,027,002    ( 220,462)

  Total liabilities and stockholders'
  equity (deficit)                                  $  12,310,521   $  490,923
  



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

                    Omega Orthodontics, Inc.
             Consolidated Statements of Operations

                                                           Period From
                                                            Inception
                                                        (August  30, 1996)
                                           Year Ended           to
                                      December 31, 1997  December 31, 1996

Revenues:
  Service   fees                      $     918,312       $           -
  Consulting   fees                          57,606              43,078
     Total revenues                         975,918              43,078

Costs and expenses:
     Employee  costs                        744,731              90,554
  Other   direct  costs                     173,538              11,678
  General   and  administrative             979,247             144,670
  Depreciation  and  amortization           116,203               1,116
  Non-recurring  consulting expense       2,592,500                   -
     Total  costs and expenses            4,606,219             248,018

Loss  from operations                    (3,630,301)        (   204,940)
  
Interest expense                         (   91,489)        (    29,635)
Interest   income                            78,665               2,463

     Net  loss                          $(3,643,125)       $(   232,112)

Basic and diluted net loss per share    $(     1.59)       $(     0.014)

Weighted average number of common shares
   outstanding                            2,289,623           1,685,000
                                       
The accompanying notes are an integral part of these consolidated
financial statements.
<TABLE>
<CAPTION>
                                        Omega Orthodontics, Inc.
                       Consolidated Statements of Stockholders' Equity (Deficit)

<S>                         <C>             <C>       <C>          <C>           <C>            <C>        
                                  Common Stock          Additional                                    Total
                             Number of   $.01 Par       Paid-in       Accumulated   Deferred       Stockholders'
                             Shares       Value         Capital         Deficit    Compensation  Equity (Deficit)

Issuance of common stock in
connection with asset
acquisition                 1,050,000       $ 10,500  $        -    $         -   $         -  $       10,500
Issuance of common stock in
connection with debt
offering                      115,000          1,150           -              -             -           1,150
Issuance of common stock in
connection with the
advisors' agreement           450,000          4,500           -              -        (4,500)              -
Net loss                            -              -           -     (  232,112)            -        (232,112)
Balance, December 31,
1996                        1,615,000         16,150           -     (  232,112)       (4,500)       (220,462)
Issuance of common stock in
connection with debt
offering                       60,000            600           -              -             -              600
Release from escrow of
common stock previously
issued to advisors                  -              -   2,020,500              -         4,500        2,025,000
Issuance of common stock to
consultants                    10,000            100           -              -             -              100
Initial public offering of
common stock and warrants,
net of issuance costs of
    $3,101,831              2,070,000         20,700   9,504,487              -             -        9,525,187
Issuance of common stock
and stock options to new
affiliated  practices         583,823          5,838   2,071,364              -             -        2,077,202
Issuance of stock options to
non-employee                        -              -     262,500              -             -          262,500
Net  loss                           -              -           -    ( 3,643,125)            -       (3,643,125)
Balance, December 31,
1997                        4,338,823       $ 43,388 $13,858,851   $( 3,875,237)     $      -     $ 10,027,002

</TABLE>
The  accompanying  notes are an integral part  of  these  consolidated
financial statements.


                     Omega Orthodontics, Inc.
              Consolidated Statements of Cash Flows
                                                            Period from
                                                             Inception
                                                          (August 30,1996)
                                          Year Ended             to
                                       December 31, 1997  December 31, 1996
Cash flows from operating activities:
Net loss                               $(    3,643,125)   $(      232,112)
Adjustments to reconcile net loss to 
net cash used in operating activities:
   Provision for bad debts                           -              5,700
   Depreciation  and amortization              116,203              9,500 
   Stock compensation                        2,288,200              2,430
   Changes in operating assets and 
   liabilities, excluding the 
   effects of acquisitions:
    Receivable from affiliated practices    (  809,080)       (    23,996)
    Prepaid expenses and other assets       (   51,791)       (     4,000)
    Accounts payable                           134,437             21,234
    Accrued expenses                        (  260,890)            88,115
    Patient prepayments                        436,782                  -
    Due to affiliated practices                147,955                  -
    Due to related parties                     277,964             27,036
 Net cash used in operating activities      (1,363,345)       (   106,093)

Cash flows from investing activities:
 Purchases of property and equipment        (   93,716)       (     7,284)
 Increase in other assets                   (   80,648)       (     1,644)
 Acquisition of management services 
  agreements and related assets             (2,216,134)                 -
 Notes receivable                           (  170,859)                 -
 Net  cash used in investing activities     (2,561,357)       (     8,928)

Cash flows from financing activities:
 Deferred offering costs                             -        (   101,228)
 Debt financing costs                       (   22,049)       (    37,694)
 Repayment of borrowings                    (1,089,000)                 -
 Proceeds from issuance of notes payable       510,000            575,000
 Net proceeds from issuance of common stock and
       warrants                              9,626,415                  -
Net cash provided by financing activities    9,025,366            436,078

Net increase in cash and cash equivalents    5,100,664            321,057
Cash and cash equivalents, beginning 
 of period                                     321,057                  -
Cash and cash equivalents, end of period  $  5,421,721     $      321,057

Supplemental disclosure of cash flow information:
 Cash paid during the year for  interest  $     97,607     $       20,135

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


                     Omega Orthodontics, Inc.
       Consolidated Statements of Cash Flows - (Continued)


                                                       Period from
                                                         Inception
                                                      (August 30,1996)
                                       Year Ended            to
                                    December 31, 1997  December 31,1996

Supplemental disclosure of cash 
 flows related to acquisitions:
 Fair  value of assets acquired, 
  excluding   cash                    $  5,708,177      $         -
 Issuance  of common stock             ( 2,077,202)               -
 Issuance  of notes payable            (   440,868)               -
 Payments in connection with 
  acquisitions, net of cash acquired   ( 2,216,134)               -

     Liabilities assumed              $    973,973      $         -

Supplemental disclosure of non cash
 items from investing activities:
 Issuance of common stock in connection
   with  acquisitions                 $  2,077,202      $         -

 Issuance of debt in connection with
   acquisitions                       $    440,868      $         -

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

Note 1 - Organization and Basis of Presentation

Omega  Orthodontics,  Inc.  (the  Company)  was  incorporated   in
Delaware  in August 1996 and subsequently acquired the assets  and
certain  consulting  contracts held by The Orthodontic  Management
Effectiveness  Group of America, LLC (Omega, LLC),  a  California-
based  orthodontic  practice management and  consulting  firm,  in
exchange for 1,050,000 shares of the Company's common stock.

The   Company  provides  management  and  marketing  services   to
orthodontic  and other dental specialty practices  in  the  United
States.   The  Company  offers  its services  primarily  under  an
"affiliate"   relationship  whereby  it   purchases   the   equity
interests  of  the  management services  organization  (MSO)  that
holds  certain assets of and is associated with an orthodontic  or
other  dental specialty practice (Affiliated Practice) and  enters
into   a   long-term  management  services  agreement  (Management
Services  Agreement) with the Affiliated Practice of  the  selling
orthodontist    or    other    dental    specialist    (Affiliated
Practitioner).   Pursuant to that agreement, the Company  receives
a  monthly  management fee, based on the revenue of the Affiliated
Practice,  for  providing all of the Affiliated Practice's  needs,
including  facility,  staff, supplies, as well  as  a  program  of
systems,  methods and procedures designed to enhance  the  growth,
efficiency and profitability of the Affiliated Practices.

On  October  6,  1997,  the  Company  closed  its  initial  public
offering  of  securities  pursuant  to  which  the  Company   sold
2,070,000  shares  of  common  stock and  2,070,000  common  stock
purchase  warrants.   The  Company  received  proceeds  from   the
offering,  net  of the underwriter's discount, fees and  expenses,
of  approximately  $9.5  million.   From  the  net  proceeds,  the
Company  paid in full the notes payable used to finance operations
prior   to  the  offering  and  paid  the  cash  portion  of   the
affiliations  with seven orthodontists (see Note 3), resulting  in
cash  available  after  the  offering  and  related  expenses   of
approximately $6.3 million.

The  Company  is  subject  to a number of  risks  associated  with
emerging,  growth companies.  Principal among these are the  risks
associated with managing growth, marketing the Company's  services
and  the  need  to  obtain adequate additional financing  to  fund
future operations and acquisitions.  Management's financial  plans
indicate  that  additional financing will be  required  in  future
periods  to meet the Company's strategic business plan; therefore,
management is exploring various financing alternatives.

The  Company  has  incurred  losses of $3,875,237  from  inception
through  December  31, 1997 and has funded those losses  primarily
through  the  sale of common stock.  The Company is  dependent  on
the  proceeds  of  additional financing to  achieve  its  business
plan.

Note 2 - Summary of Significant Accounting Policies

Principles of Consolidation

The  consolidated financial statements include the accounts of the
Company   and   its  wholly-owned  subsidiaries.    All   material
intercompany  accounts and transactions have  been  eliminated  in
consolidation.

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  amount  of  revenues and expenses during  the  reporting
period.  Actual results could differ from those estimates.

Cash and Cash Equivalents

The  Company considers all highly liquid investments with original
maturities of three months or less when purchased to be  cash  and
cash   equivalents.    Cash  equivalents  consist   primarily   of
commercial  paper  at December 31, 1997 and are carried  at  cost,
which approximates market value.

Property and Equipment

Property  and  equipment  is  stated  at  cost.   Equipment  under
capital  lease  is stated at the net present value of  the  future
minimum  lease  payments at the inception of the  related  leases.
Depreciation  expense  is provided using the straight-line  method
over  the  estimated  useful lives of the assets,  five  to  seven
years.   Leasehold improvements are amortized using the  straight-
line  method  over  the  shorter of the lease  term  or  estimated
useful  life  of the assets.  Routine maintenance and repairs  are
charged  to  expense as incurred, while costs of  betterments  and
renewals are capitalized.

Intangible Assets

Intangible  assets  consist primarily of  the  value  ascribed  to
Management Services Agreements which are amortized over  the  life
of  the  Management Services Agreements (ranging  from  25  to  40
years)  with  the respective Affiliated Practices.  The  Company's
management  periodically  evaluates  the  realizability   of   the
intangible  assets  on  a practice by practice  basis  considering
such  factors  as  profitability and net cash flow.   Should  this
evaluation  result  in  an  assessment  that  the  value  of   the
intangible asset is overstated, an adjustment will be made in  the
period  that  the adjustment is identified.  If it  is  determined
that  the  estimated  remaining service period requires  revision,
that  revision will be made on a prospective basis.  Based on  its
most  recent  analysis, management believes that no impairment  of
intangible assets exists.

Reclassifications

Certain  amounts  in  the  prior year have  been  reclassified  to
conform    with    the    current   year   presentation.     These
reclassifications had no effect on change in accumulated deficit.

Revenue Recognition

The  Company's  services  are provided under  Management  Services
Agreements  and  interim  management  agreements  with  Affiliated
Practices  (management  agreements).  Net revenue  earned  by  the
Company  under the management agreements is equal to approximately
25%  of  new patient contract balances in the first month  of  new
patient  contracts  plus a portion of existing contract  balances,
less  amounts retained by the Affiliated Practices.   The  Company
provides  practice  management and marketing services,  facilities
and  non-professional personnel and receives 65%  to  75%  of  the
Affiliated   Practices'  gross  patient  fee  collections   as   a
management  fee.  The Affiliated Practices retain all revenue  not
paid  to  the Company as the management fee.  The amounts retained
by  the  Affiliated  Practices are dependent  on  their  financial
performance, based in significant part on their cash receipts  and
disbursements.   If total expenses of an Affiliated  Practice  are
below  prescribed percentages, the Affiliate Practice is  entitled
to  retain  50%  of  the  difference.   Under  the  terms  of  the
management   agreements,  the Affiliated  Practices  assign  their
receivables  to  the Company in payment of their management  fees.
The  Company  is  responsible for collections.  The  Company  also
assumes   its  portion  of  patient  prepayments,  deposits   from
patients for dental care to be performed in future periods.

Loss Per Share

In  March  1997, the Financial Accounting Standards  Board  (FASB)
issued  Statement  of  Financial Accounting Standards  (SFAS)  No.
128,  Earnings  per  Share.  This statement established  standards
for  computing  and presenting earnings per share and  applies  to
entities  with  publicly traded common stock or  potential  common
stock.  This statement is effective for fiscal years ending  after
December  15, 1997.  In February 1998, the Securities and Exchange
Commission  (SEC)  issued Staff Accounting Bulletin  No.  98  (SAB
98).   This  bulletin revises the SEC's guidance  for  calculating
earnings  per  share  for fiscal years ending after  December  15,
1997.

Basic  loss per share was determined by dividing net loss  by  the
weighted  average  common shares outstanding  during  the  period.
Diluted loss per share is the same as basic loss per share as  the
effects  of  the  Company's  potential common  stock  (options  to
purchase 233,333 shares of common stock and 2,070,000 warrants  in
1997)   are   antidilutive.   During  the  period  preceding   the
Company's  initial  public offering, the  Company  issued  185,000
shares  of  common  stock  that  have  been  treated  as  "nominal
issuances"  in  accordance with SAB 98 in the calculation  of  net
loss per share.

Concentration of Credit Risk

SFAS   No.   105,   Disclosure  of  Information  About   Financial
Instruments  with Off-Balance-Sheet Risk and Financial Instruments
with  Concentrations of Credit Risk, requires disclosures  of  any
significant  off-balance-sheet  and  credit  risk  concentrations.
The Company has no significant off-balance-sheet concentration  of
credit  risk such as foreign exchange contracts, option  contracts
or  other foreign hedging arrangements.  The Company maintains the
majority  of  its  cash  balances with one financial  institution.
The  Company's  accounts receivable credit  risk  is  concentrated
within   the   United  States,  and  no  customer  represented   a
significant credit risk to the Company.

Financial Instruments

SFAS   No.   107,  Disclosures  About  Fair  Value  of   Financial
Instruments,  requires disclosure about fair  value  of  financial
instruments.   The  Company's  financial  instruments  consist  of
cash,  cash  equivalents, receivables, accounts  payable,  patient
prepayments  and debt instruments.  The estimated  fair  value  of
these financial instruments approximate their carrying value.

New Accounting Standards

In   June   1997,   the  FASB  issued  SFAS  No.  130,   Reporting
Comprehensive  Income.  SFAS No. 130 requires  disclosure  of  all
components  of  comprehensive income  on  an  annual  and  interim
basis.   Comprehensive income is defined as the change  in  equity
of  a  business  enterprise during a period from transactions  and
other  events and circumstances from nonowner sources.   SFAS  No.
130  is  effective for the fiscal years beginning  after  December
15, 1997.

In  July  1997,  the  FASB issued SFAS No. 131, Disclosures  About
Segments of an Enterprise and Related Information.  SFAS  No.  131
requires  certain  financial and supplementary information  to  be
disclosed  on  an  annual and interim basis  for  each  reportable
segment  of  an enterprise.  SFAS No. 131 is effective for  fiscal
years  beginning  after December 15, 1997.  Unless  impracticable,
companies  would  be required to restate prior period  information
upon adoption.

During  1997, the Emerging Issues Task Force (EITF)  of  the  FASB
issued EITF 97-02, Application of FASB Statement No.  94  and  APB
Opinion  No.  16  to  Physician Practice Management  Entities  and
Certain  Other  Entities with Contractual Management Arrangements,
which  provides  guidance  regarding the accounting  treatment  of
contractual   management  relationships.   The  EITF   established
specific   criteria   to   be  met  for  consolidating   physician
practices.   The criteria include the existence by  the  Physician
Practice Management Entity of a controlling financial interest  in
the  physician's practice based on term of the agreement,  control
of  the  non-medical operating decisions, and financial  interest.
Based  on  its  most  recent  analysis,  management  believes  the
Company  does  not have a controlling financial  interest  in  the
physician practices with which it contracts.

Note 3 - Initial Orthodontic Affiliations

On  October 6, 1997, the Company entered into Management  Services
Agreements  with  seven Affiliated Practices  (Initial  Affiliated
Practices)  in the United States, simultaneously with the  closing
of  its  initial  public offering (see Note 1).  These  agreements
provide  for  the purchase by the Company of the equity  interests
in  the  MSOs  formed by the selling orthodontists (Initial  MSOs)
for  consideration  ranging from $297,000  to  $952,000  for  each
Initial  MSO.   Total  consideration related to  the  affiliations
with the Initial MSO is summarized as follows:

     Value of common stock and options issued          $1,865,202
     Cash paid                                          1,782,801
     Notes payable                                        142,535
          Total                                        $3,790,538

The  cost  of each of the Initial MSOs has been allocated  on  the
basis  of  the  estimated fair value of the  assets  acquired  and
liabilities  assumed,  resulting in  management  service  contract
intangibles of approximately $4.1 million.  These allocations  may
be  adjusted  to  the  extent  that management  becomes  aware  of
additional   information  within  one  reporting   year   of   the
affiliation  date,  which  results in a  material  change  in  the
amount  of any contingency or changes in the estimated fair  value
of assets acquired and liabilities assumed.

The  allocation  of  the  purchase  price  of  the  Initial  MSOs,
including  acquisition  costs  of  approximately  $39,000,  is  as
follows:

     Receivables                             $         152,090
     Property and equipment                            305,091
     Management service contract intangibles         4,094,126
     Patient prepayments                           (   219,514)
     Assumed liabilities                           (   541,255)

                                                    $3,790,538

Concurrent  with  the  affiliation  with  the  Initial  MSOs,  the
Company  and  each  Initial MSO entered into a 20-year  Management
Services  Agreement, renewable for two additional 10-year periods,
with  each  Initial Affiliated Practice.  The agreement stipulates
that  the  Initial MSO provide practice management  and  marketing
services,  facilities and non-clinical personnel  to  the  Initial
Affiliated Practices for a monthly fee, generally equal to 65%  to
75%  of  the  Initial  Affiliated  Practice's  gross  patient  fee
collections.   If  the total expenses of each  Initial  Affiliated
Practice  are below prescribed percentages, the Initial Affiliated
Practice  is  entitled  to  receive 50%  of  the  difference.  The
Initial  Affiliated  Practice has sole  authority  to  direct  the
business,  professional and ethical aspects of the practice,  make
all  professional hiring decisions, render patient care, and  keep
all  patient records.  Each Initial Affiliated Practice  has  also
entered  into  an  employment agreement, including non-competition
provisions, with each orthodontist employed and has agreed to  pay
all  salaries for dental professionals, professional licensure and
board  certification  fees  and professional  liability  insurance
premiums.

Each  Affiliated  Practitioner has certain rights and  obligations
to  repurchase, and each Initial MSO has the right to require  the
Affiliated  Practitioner to repurchase, the non-clinical  practice
assets  held by such Initial MSO in the event that the  Management
Services  Agreement is terminated.  Such purchases will  generally
require  payment  of  the book value of  the  net  assets  of  the
Initial  MSO.   The  Initial  MSO  also  has  certain  rights   to
designate a successor orthodontist to acquire the practice of  the
Affiliated  Practitioner when the Affiliated  Practitioner  ceases
practice.

Financial  data  for the year ended December 31, 1996  related  to
the Initial Affiliated Practices are summarized as follows:
                                                      Unaudited
       Patient revenues                     $         4,615,677
       Cash collections                               4,486,113
       Practice expenses                              4,076,863

Practice    expenses   included   $1,014,584   in   orthodontists'
compensation.

Note 4 - New Affiliated Practices

During  the  period from the initial public offering,  October  6,
1997   through   December   31,  1997,   the   Company   completed
affiliations with two new Affiliated Practices.

Total  consideration  related to the new Affiliated  Practices  is
summarized as follows:

       Value of common stock issued      $            212,000
       Cash paid                                      433,333
       Notes payable                                  298,333

          Total                          $            943,666

The  cost  of each of the above new Affiliated Practices has  been
allocated  on the basis of the estimated fair value of the  assets
acquired   and   liabilities  assumed,  resulting  in   management
contract   intangibles   of   approximately   $1,040,000.    These
allocations may be adjusted to the extent that management  becomes
aware  of additional information within one reporting year of  the
affiliation date which results in a material change in the  amount
of  any  contingency  or changes in the estimated  fair  value  of
assets acquired and liabilities assumed.

The  allocation  of  the  purchase price  of  the  new  Affiliated
Practices,  including acquisition costs of approximately  $28,000,
is as follows:

     Property and equipment                      $     116,809
     Management service contract intangibles         1,040,061
     Patient prepayments                           (   119,402)
     Assumed liabilities                           (    93,802)

                                                     $ 943,666

In  addition,  during 1997, the Company entered  into  an  interim
management  agreement  with  two separate  orthodontic  practices,
pursuant  to which the Company provides management services  under
essentially  the same terms as its Management Services  Agreement,
prior  to  the  completion of the affiliation agreements.   During
1998,  both  of these practices completed their affiliations  with
the Company.

Note 5 - Property and Equipment

Property and equipment consist of the following at December 31:

                                      1997              1996

   Office  equipment         $       45,072       $   11,212
   Dental equipment                 272,486                -
   Furniture and fixtures            46,132                -
   Leasehold   improvements         163,138                -
                                    526,828           11,212
   Less: accumulated depreciation
     and    amortization             23,489            1,116

                                   $503,339          $10,096

Depreciation and amortization expense was $22,373 and  $1,116  for
the  year  ended  December  31,  1997  and  for  the  period  from
inception (August 30, 1996) to December 31, 1996, respectively.



Note 6 - Other Assets

Other assets consist of the following at December 31:

                                      1997             1996

   Deferred  acquisition costs     $ 71,828      $         -
   Deferred   offering   costs            -          101,228
   Debt     financing    costs            -           38,844
   Organization    costs              7,820            8,216
   Deposits                           1,000                -
                                     80,648          148,288
   Less:  accumulated  amortization     345           10,814
   Other  assets,  net             $ 80,303      $   137,474

Deferred  acquisition costs include professional fees incurred  in
advance  of  the  acquisition of additional Affiliated  Practices.
Deferred  offering  costs include all expenses incurred  prior  to
December  31,  1996  in  connection with the  preparation  of  the
initial  public  offering.   Debt  financing  costs  incurred   in
connection  with  the  issuance of  notes  payable  in  1996  were
amortized over the term of the debt.

Note 7 - Long-Term Debt

Long-term debt consisted of the following at December 31:
                                                        1997           1996
Note payable of an affiliate practice assumed by the
   Company, due in monthly installments ranging from
   $100 to $1,213 through December, 2003, with
   interest at 13.2% and secured by the personal
   guarantee  of  the affiliated orthodontist.     $  51,948        $      -

Unsecured notes payable to affiliate practices,
   issued in connection with affiliation agreement
     (see Note 3 and Note 4) due in monthly installments
   ranging from $630 to $4,860 through January, 2003,
   with  interest  at  8.5%.                        436,868                -

Capitalized lease obligations, due in monthly
   installments ranging from $652 to $1,646 through
   July, 2002, with interest ranging from 13% to
   23%  and  secured  by certain equipment.          55,865                -


Unsecured bridge notes, payable with interest
   at 15% and paid in full with proceeds from the
   Company's initial public offering (see Note 1).        -           575,000
                                                    544,681           575,000
Less:  current  portion                              76,130           575,000

                                                   $468,551         $       -

Maturities of long-term debt at December 31, 1997 are as follows:

               1998                  $  76,130
               1999                    137,961
               2000                    105,746
               2001                    104,896
               2002                    101,512
               Thereafter               18,436

                                      $544,681

The  Company issued two series of notes in the aggregate principal
amount  of  $510,000 and $575,000 in 1997 and 1996,  respectively.
The  interest on the notes was 16% and 15% per annum and  was  due
on  the earlier of September 30, 1997 or upon consummation  of  an
initial  public offering.  The notes were paid in  full  with  the
proceeds  of  the  initial  public offering   (see  Note  1).   In
consideration  for the purchase of the notes, the  Company  issued
to  the  noteholders for nominal value, 60,000 and 115,000  shares
of  common stock in 1997 and 1996, respectively, for no additional
payment.

Notes 8 - Stock Option Plan

The  Company adopted an Incentive Stock Plan (the Plan)  effective
January  31,  1997.   Plan awards in the form  of  stock  options,
stock  appreciation rights, restricted stock and stock grants  may
be  issued  to employees, consultants and advisors of the  Company
at  prices  to  be  determined by a  committee  of  the  Board  of
Directors.   On April 28, 1997, the Plan was amended  to  increase
the  number  of  shares  of common stock authorized  for  issuance
under  the  Plan to 450,000.  The Plan will terminate  on  January
31, 2007.

The  Plan  is  administered by the Compensation Committee  of  the
Board   of   Directors,  which  has  the  authority  to  designate
participants,  determine the number and  type  of  options  to  be
granted, the time at which options are exercisable, the method  of
payment  and  any  other  terms  or  conditions  of  the  options.
Options  generally  vest  annually over a  three-year  period  and
generally expire 10 years from the date of grant.


While  the  Compensation Committee determines the price  at  which
options may be exercised under the Plan, the exercise price of  an
incentive  stock option shall be at least 100% (110% for incentive
stock  options granted to a 10% stockholder) of the fair value  of
the Company's common stock on the date of grant.

The following table summarizes option activity under the Plan:
                                   
                                                                    Weighted
                                                                     Average
                                           Number      Exercise      Exercise
                                           Of Shares     Price        Price
   Outstanding,  December  31,  1996              -   $         -    $    -
     Granted                                370,000     3.00 - 6.00     5.84

   Outstanding,  December 31,  1997         370,000   $ 3.00 - 6.00  $  5.84
   
   Exercisable,   December   31,   1997     150,000           $6.00  $  6.00

The  following  table summarizes information about  stock  options
outstanding at December 31, 1997:
                                   Number                 Weighted     Weighted
                                   Outstanding             Average     Average
                                   At                    Remaining      Excise
                                   December 31,         Contractual     Price
                                   1997                     Life       Per Share

Exercise prices
$  3.00                                20,000               9.98       $  3.00
$  6.00                               350,000               9.33          6.00
                                      370,000                          $  5.84

The   weighted  average  remaining  contractual  life  of  options
outstanding  at  December  31,  1997  was  9.37  years.    Options
available for future grant under the Plan as of December 31,  1997
were 80,000.

In  October  1995,  the FASB issued SFAS No. 123,  Accounting  for
Stock-Based  Compensation.  SFAS No. 123 requires the  measurement
of  the fair value of stock options or warrants to be included  in
the  statement  of  operations  or  disclosed  in  the  notes   to
financial  statements.  The Company has determined  that  it  will
continue  to  account for stock-based compensation  for  employees
under  Accounting Principles Board Opinion No. 25 and  will  elect
the  disclosure-only  alternative  under  SFAS  No.  123.   As  of
December 31, 1997, none of the options granted to employees  under
the  plan  have  vested and therefore no pro forma  disclosure  of
compensation expense is necessary.

The  Company has computed the compensation expense required  under
SFAS  No.  123 for options granted in 1997 to non-employees  using
the  Black-Scholes  option pricing model prescribed  by  SFAS  No.
123, using the following assumptions:

                                              December 31, 1997

     Risk-free interest rate                            6.61%
     Expected dividend yield                                -
     Expected lives                                     7 years
     Expected volatility                                  48%

As  of December 31, 1997, the Company granted 150,000 nonqualified
stock options exercisable at $6.00, which are fully vested,  to  a
consultant  as  payment  for  services  performed.   The   Company
recorded  $262,500  of  non-recurring consulting  expense  in  the
accompanying  consolidated statements of operations for  the  year
ended  December  31,  1997  related  to  this  transaction,  which
represents  the  estimated fair value of  the  services  received.
The  options are fully exercisable and expire ten years  from  the
date of grant.

Note 9 - Stockholders' Equity (Deficit)

(a)  Preferred Stock

   The   Company  is  authorized  to  issue  500,000   shares   of
   preferred stock.  The preferred stock will be issuable  in  one
   or  more  series,  each  such series to have  such  rights  and
   preferences,   including   voting  rights,   dividend   rights,
   conversion   rights,  redemption  privileges  and   liquidation
   preferences,   as  shall  be  determined  by   the   Board   of
   Directors.

(b)  Initial Public Offering

   Pursuant  to  the Company's initial public offering  (see  Note
   1),  the  Company  issued  2,070,000  warrants.   Each  warrant
   entitles  the registered holder thereof to purchase  one  share
   of  common  stock  at an initial exercise price  of  $6.60  per
   share,  at any time during the period commencing April 1,  1998
   and  terminating  September  30, 2002.   The  warrant  exercise
   price  is  subject  to adjustment under certain  circumstances.
   Commencing   April  1,  1999,  the  Company  may   redeem   the
   warrants,  in  whole  but not in part,  at  $.10  per  warrant,
   provided  the  average closing bid price of  the  common  stock
   equals or exceeds $12.00 per share for a period of time.

   In  addition,  the  Company  issued  180,000  warrants  to  its
   underwriter.   These  warrants entitle the holder  to  purchase
   up  to  180,000 shares of common stock and/or 180,000  warrants
   at  an  initial  exercise price of $9.90 per  share  of  common
   stock  and  $0.165  per warrant, commencing  after  October  1,
   1998 and expiring October 1, 2001.

(c)  Reserved Common Stock

   The Company has reserved common stock for the following:

       Options to purchase common stock      533,333
       Warrants to purchase common stock   2,070,000
       Underwriter's warrants                360,000
                                           2,963,333

Note 10 - Income Taxes

The  Company accounts for income taxes in accordance with SFAS No.
109,  Accounting for Income Taxes.  Under SFAS No.  109,  deferred
tax  assets  or  liabilities are computed based on the  difference
between  the  financial statement and income tax basis  of  assets
and  liabilities using the enacted tax rates.  Deferred income tax
expense  or credits are based on changes in the asset or liability
from period to period.

As  of  December 31, 1997, the Company had available net operating
loss  carryforwards  of  approximately  $2,300,000  available   to
reduce  future  federal income taxes, if any.  These carryforwards
expire  through  2012  and  are subject  to  review  and  possible
adjustment  by the Internal Revenue Service.  The Tax  Reform  Act
of  1986  limits  a corporation's ability to utilize  certain  net
operating  loss carryforwards in the event of a cumulative  change
in ownership in excess of 50%, as defined.

The  approximate  income  tax effect of  each  type  of  temporary
difference  and carryforward and valuation allowance is summarized
as follows:

                                           1997       1996

   Net operating losses                  $   828,970  $92,845
   Other temporary differences                (2,707)       -
   Less: valuation allowance                 826,263   92,845
                                         $         -  $     -

Due  to  the  uncertainty relating to the timing of realizing  the
benefits  of  its  favorable tax attributes in future  income  tax
returns,  the  Company  has  placed  a  full  valuation  allowance
against its otherwise recognizable net deferred tax asset.

Note 11 - Related Party Transactions

The  Company has an agreement with a private bank and the Chairman
of   the  Board  of  Directors  (the  Consultants),  whereby   the
Consultants have agreed to provide certain consulting services  to
the   Company.    In  August  1996,  as  consideration  for   such
services,  the  Company  contingently  issued  450,000  shares  of
common  stock  to  the Consultants at no cost  and  simultaneously
placed  such  shares  in  escrow.  As of December  31,  1996,  the
450,000 shares were included in outstanding common stock at  their
nominal  fair  value at the date of issuance with a  corresponding
deferred charge.

In   April  1997,  following  the  completion  of  the  consulting
services,  all  of  the shares were released  from  escrow  at  an
imputed  aggregate value of $2,025,000.  In addition, the  Company
agreed  to  make  cash  payments to  the  Consultants  aggregating
$305,000 in 1998.

Total   expense   of  $2,330,000  was  recorded  as  non-recurring
consulting expense in the accompanying consolidated statements  of
operations  and  the  $305,000 was  recorded  as  due  to  related
parties in the accompanying consolidated balance sheets.

During  1997  and 1996, three directors of the Company  loaned  an
aggregate  of $140,000 and $75,000, respectively, to  the  Company
and  received 6,000 shares and 15,000 shares, respectively, of the
Company's common stock in connection therewith (see Note  7).   In
addition,  three directors performed consulting services  for  the
Company, prior to the Company's initial public offering for  which
they  were paid an aggregate of approximately $166,000 and $73,273
in   1997  and  1996,  respectively.   The  Company  entered  into
employment  contracts with two directors and  consulting  contract
with  one director, which became effective upon the completion  of
the  Company's initial public offering.  The Company paid  $75,000
in  connection with these employment and consulting contracts.  In
addition,  during  1997,  the Company  granted  two  directors  an
aggregate of 200,000 stock options exercisable at $6.00 per  share
(see  Note  8).   In  December  1997,  the  Company  granted   two
directors  non-qualified stock options under the  Incentive  Stock
Option  Plan to each acquire 10,000 shares of the Company's common
stock at an exercise price of $3.00 per share.

During 1997, the Company entered into a consulting agreement  with
an  accounting firm for services relating to the Company's initial
public  offering  and  for the services  of  the  Company's  Chief
Financial  Officer  who  is also a principal  stockholder  of  the
accounting firm.  The Company paid consulting fees of $203,565  in
1997  in  connection with the above services.   The  Company  also
granted the accounting firm 10,000 shares of common stock and non-
qualified stock options under the Stock Incentive Option  Plan  to
acquire  150,000  shares  of  the Company's  common  stock  at  an
exercise price of $6.00 per share (see Note 8).

The   Company  entered  into  an  affiliation  agreement  with   a
director, which became effective concurrently with the closing  of
the   Company's   initial  public  offering.   Pursuant   to   the
affiliation  agreement, the Company acquired  certain  assets  of
the  Director's  orthodontic  practice  in  exchange  for  a  cash
payment of $333,567, 129,721 shares of the Company's common  stock
and the assumption of certain liabilities.

During  1997,  the Company loaned the President and  CEO  $100,000
and  a  director $20,000 in exchange for demand promissory  notes,
which  bear interest at the prime rate (8.5% at December 31, 1997)
plus  2%.   Principal and interest are due upon  demand,  but  not
later than  December, 2000.

Note 12 - Commitments and Contingencies

(a)Operating Leases

   The  Company  leases facilities under various operating  leases
   which  expire  through  October  2017.   Future  minimum  lease
   payments as of December 31, 1997 are as follows:

               1998                $    392,000
               1999                     245,000
               2000                     218,000
               2001                     218,000
               2002                     195,000
               Thereafter               902,000

                                   $  2,170,000

   Rent   expense  for  all  operating  leases  was  approximately
   $86,100  and  $1,900 for the year ended December 31,  1997  and
   for  the  period from inception (August 30, 1996)  to  December
   31, 1996, respectively.

(b)Litigation

   The  Company is not currently a party to any claims,  suits  or
   complaints  relating to services and products provided  by  the
   Company  or  the existing Affiliated Practices, although  there
   can  be  no  assurance that such claims will  not  be  asserted
   against the Company in the future.

Note 13 - Subsequent Events

In  January  1998, the Company completed  affiliations  with  five
additional  Affiliated  Practices  (two  of   which  merged   with 
existing Affiliated  Practices)  which had  generated   historical
patient  revenue  over  the prior twelve months  of  approximately
$3.4   million.    Prior  patient  revenue  is   not   necessarily
indicative   of  the  level  of  revenue  that  these   Affiliated
Practices  may  be  expected to generate  in  the  future.   Total
consideration  for  these new Affiliated  Practices  consisted  of
approximately  $863,000  of  common stock  (approximately  462,000
shares)  and approximately $2.4 million of cash, assumed debt  and
notes   payable,   resulting   in  management   service   contract
intangibles of approximately $3.0 million.


Item 8.Changes   in   and   Disagreements  With  Accountants   on
       Accounting and Financial Disclosure

   The information required by this Item 8 is hereby incorporated
by  reference to the Company's Current Report on Form  8-K  dated
January 14, 1998.

                            PART III

Item  9.     Directors, Executive Officers, Promoters and Control
Persons; Compliance With Section 16(a) of the Exchange Act

   The information required by this Item 9 is hereby incorporated
by  reference to the Company's definitive proxy statement  to  be
filed  by  the  Company within 120 days after the  close  of  its
fiscal year.

Item 10.   Executive Compensation

     The   information  required  by  this  Item  10  is   hereby
incorporated  by  reference  to the  Company's  definitive  proxy
statement  to be filed by the Company within 120 days  after  the
close of its fiscal year.

Item 11.    Security  Ownership of Certain Beneficial Owners  and
       Management

     The   information  required  by  this  Item  11  is   hereby
incorporated  by  reference  to the  Company's  definitive  proxy
statement  to be filed by the Company within 120 days  after  the
close of its fiscal year.

Item 12.  Certain Relationships and Related Transactions

     The   information  required  by  this  Item  12  is   hereby
incorporated  by  reference  to the  Company's  definitive  proxy
statement  to be filed by the Company within 120 days  after  the
close of its fiscal year.

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

(a)            Exhibits

Exhibit                                            
No.    Exhibit Description                        Reference
                                                  
2.1    Asset Purchase Agreement dated as of          A
       August 31, 1996 by and between Omega
       Orthodontics, Inc. and The Orthodontic
       Management Effectiveness Group of
       America, LLC
2.2    Form of Affiliation Agreement and             A
       Agreement and Plan of Merger by and among
       Omega Orthodontics, Inc., Robert R.
       Schmisseur, D.D.S. and Robert R.
       Schmisseur, D.D.S., M.S., P.C., as
       amended
2.3    Affiliation Agreement and Agreement and       A
       Plan of Merger by and among Omega
       Orthodontics, Inc., Theodore G. Saydyk,
       Jr., D.D.S. and Theodore G. Saydyk, Jr.,
       D.D.S., P.C., as amended
2.4    Form of Affiliation Agreement and Asset       A
       Purchase Agreement by and among Omega
       Orthodontics, Inc. and Scott E. Feldman,
       D.D.S.
2.5    Form of Affiliation Agreement and Stock       A
       Purchase Agreement by and between Omega
       Orthodontics, Inc. and David T. Grove,
       D.M.D.
2.6    Form of Affiliation Agreement and Asset       A
       Purchase Agreement by and between Omega
       Orthodontics, Inc. and David T. Grove,
       D.M.D.
2.7    Affiliation Agreement and Agreement and       A
       Plan of Merger by and among Omega
       Orthodontics, Inc., Michael G. Churosh,
       D.D.S. and Michael G. Churosh, D.D.S.,
       M.S., LTD., as amended
2.8    Affiliation Agreement and Agreement and       A
       Plan of Merger by and among Omega
       Orthodontics, Inc., Clark E. Schneekluth,
       D.D.S. and Clark E. Schneekluth, D.D.S.,
       P.C., as amended
2.9    Affiliation Agreement and Asset Purchase   Filed
       Agreement by and between Omega             Herewith
       Orthodontics, Inc. and Leon J. Leonard,    
       D.D.S.
2.10   Affiliation Agreement and Asset Purchase   Filed
       Agreement by and between Omega             Herewith
       Orthodontics, Inc. and David Longworth,    
       D.D.S.                                     
2.11   Affiliation Agreement and Asset Purchase   Filed
       Agreement by and between Omega             Herewith
       Orthodontics, Inc. and Rodney A. Gray,     
       D.D.S.
2.12   Agreement for the Purchase and Sale of     Filed
       Assets by and between Sharon M. Crowder,   Herewith
       D.D.S., Inc. and Omega Orthodontics of     
       Reseda, Inc.
2.13   Affiliation Agreement and Agreement and    Filed
       Plan of Merger by and among Omega          Herewith
       Orthodontics of Woodland Hills, Inc.,      
       Omega Orthodontics, Inc., Sharon M.
       Crowder, D.D.S., Scott E. Feldman, D.D.S.
       and Omega Orthodontics of Reseda, Inc.
2.14   Affiliation Agreement and Asset Purchase   Filed
       Agreement by and among Omega               Herewith
       Orthodontics, Inc., Richard H. Villa,      
       D.D.S. and Richard H. Villa, D.D.S., Inc.
2.15   Affiliation Agreement and Agreement and    Filed
       Plan of Merger by and among Omega          Herewith
       Orthodontics of Woodland Hills, Inc.,      
       Omega Orthodontics, Inc., Azani Dental
       Services, Inc., Daniel Azani, D.D.S. and
       Daniel Azani, D.D.S., Inc.
2.15a  Amendment to Affiliation Agreement and     Filed
       Plan of Merger by and among Omega          Herewith
       Orthodontics of Woodland Hills, Inc.,      
       Omega Orthodontics, Inc., Azani Dental
       Services, Inc., Daniel Azani, D.D.S. and
       Daniel Azani, D.D.S., Inc.
2.16   Affiliation Agreement and Asset Purchase   Filed
       Agreement by and among Omega               Herewith
       Orthodontics, Inc., William W. Beazley,    
       D.D.S. and William W. Beazley, D.D.S.,
       Inc.
3.1    Certificate of Incorporation of Omega         A
       Orthodontics, Inc.
3.2    Certificate of Amendment of Certificate       A
       of Incorporation of Omega Orthodontics,
       Inc. filed February 12, 1997
3.3    By-Laws of Omega Orthodontics, Inc., as       A
       amended
4.1    Specimen Certificate for Common Stock         A
4.2    Form of Subscription Agreement for            A
       private placement of 15% Senior Notes due
       September 30, 1997 (including rights to
       receive shares of Common Stock
4.3    Form of 15% Senior Notes due September        A
       30, 1997, as amended
4.4    Warrant Agreement by and between Omega        A
       Orthodontics, Inc. and Continental Stock
       Transfer & Trust Company, including form
       of Warrant
4.5    Representative's Warrant Agreement by and     A
       between National Securities Corporation
       and Omega Orthodontics, Inc., including
       form of Representative's Warrant
4.6    Form of 16% Promissory Notes due June 30,     A
       1998
10.1   Form of Management Services Agreement by      A
       and among a professional corporation to
       be formed by Dr. Schmisseur, Omega
       Orthodontics of Champaign, Inc. and Omega
       Orthodontics, Inc.
10.2   Form of Management Services Agreement by      A
       and among a professional corporation to
       be formed by Dr. Saydyk, Omega
       Orthodontics of Colorado Springs, Inc.
       and Omega Orthodontics, Inc.
10.3   Amended and Restated Management Services   Filed
       Agreement by and among Scott E. Feldman,   Herewith
       D.D.S., M.S., Inc., Omega Orthodontics of  
       Woodland Hills, Inc. and Omega
       Orthodontics, Inc.
10.4   Form of Management Services Agreement by      A
       and among a professional corporation to
       be formed by Dr. Zapalac, Omega
       Orthodontics of Austin, Inc. and Omega
       Orthodontics, Inc.
10.5   Form of Management Services Agreement by      A
       and among a professional corporation to
       be formed by Dr. Grove, Omega
       Orthodontics of Elko, Inc. and Omega
       Orthodontics, Inc.
10.6   Form of Management Services Agreement by      A
       and among a professional corporation to
       be formed by Dr. Churosh, Omega
       Orthodontics of Goodyear, Inc. and Omega
       Orthodontics, Inc.
10.7   Form of Management Services Agreement by      A
       and among a professional corporation to
       be formed by Dr. Schneekluth, Omega
       Orthodontics of Huntington Beach, Inc.
       and Omega Orthodontics, Inc.
10.8   Form of Stock Put/Call Option and             A
       Successor Designation Agreement by and
       among a professional corporation to be
       formed by Dr. Schmisseur, Robert R.
       Schmisseur, D.D.S., Omega Orthodontics,
       Inc. and Omega Orthodontics of Champaign,
       Inc.
10.9   Form of Stock Put/Call Option and             A
       Successor Designation Agreement by and
       among a professional corporation to be
       formed by Dr. Saydyk, Theodore G. Saydyk,
       Jr., D.D.S., Omega Orthodontics, Inc. and
       Omega Orthodontics of Colorado Springs,
       Inc.
10.10  Form of Stock Put/Call Option and             A
       Successor Designation Agreement by and
       among a professional corporation to be
       formed by Dr. Feldman, Scott E. Feldman,
       D.D.S., Omega Orthodontics, Inc. and
       Omega Orthodontics of Woodland Hills,
       Inc.
10.11  Form of Stock Put/Call Option and             A
       Successor Designation Agreement by and
       among a professional corporation to be
       formed by Dr. Zapalac, Jeff S. Zapalac,
       D.D.S., Inc., Omega Orthodontics, Inc.
       and Omega Orthodontics of Austin, Inc.
10.12  Form of Stock Put/Call Option and             A
       Successor Designation Agreement by and
       among a professional corporation to be
       formed by Dr. Grove, David T. Grove,
       D.M.D., Omega Orthodontics, Inc. and
       Omega Orthodontics of Elko, Inc.
10.13  Form of Stock Put/Call Option and             A
       Successor Designation Agreement by and
       among a professional corporation to be
       formed by Dr. Churosh, Michael G.
       Churosh, D.D.S., Omega Orthodontics, Inc.
       and Omega Orthodontics of Goodyear, Inc.
10.14  Form of Stock Put/Call Option and             A
       Successor Designation Agreement by and
       among a professional corporation to be
       formed by Dr. Schneekluth, Clark E.
       Schneekluth, D.D.S., Omega Orthodontics,
       Inc. and Omega Orthodontics of Huntington
       Beach, Inc.
10.15  Form of Non-negotiable Promissory Note        A
       from Omega Orthodontics, Inc. payable to
       Robert R. Schmisseur
10.16  Form of Non-negotiable Promissory Note        A
       from Omega Orthodontics, Inc. payable to
       Theodore G. Saydyk, Jr.
10.17  Form of Non-negotiable Promissory Note        A
       from Omega Orthodontics, Inc. payable to
       Scott E. Feldman
10.18  Form of Non-negotiable Promissory Note        A
       from Omega Orthodontics, Inc. payable to
       David T. Grove
10.19  Form of Non-negotiable Promissory Note        A
       from Omega Orthodontics, Inc. payable to
       Clark E. Schneekluth
10.20  General Assignment and Assumption             A
       Agreement dated as of August 31, 1997 by
       and between The Orthodontic Management
       Effectiveness Group of America, LLC and
       Omega Orthodontics, Inc.
10.21* Employment Agreement by and between           A
       Robert J. Schulhof and Omega
       Orthodontics, Inc.
10.22  INTENTIONALLY OMITTED                          
10.23* Employment Agreement by and between F.V.      A
       Elliott and Omega Orthodontics, Inc.
10.24* Omega Orthodontics Incentive Stock Plan,      A
       as amended
10.25  Subscription Agreement dated as of            A
       September 9, 1996 and April 28, 1997 by
       and between Omega Orthodontics, Inc. and
       C. Joel Glovsky Rollover IRA
10.26  Subscription Agreement dated as of            A
       September 25, 1996 by and between Omega
       Orthodontics, Inc. and Dean C. Bellavia.
10.27* Amended and Restated Consulting Agreement     A
       by and among Omega Orthodontics, Inc.,
       The Mayflower Group, Ltd., and C. Joel
       Glovsky, as amended
10.27a Amendment dated [March __, 1998] to the    Filed
*      Amended and Restated Consulting Agreement  Herewith
       by and among Omega Orthodontics, Inc.,     
       The Mayflower Group, Ltd., and C. Joel
       Glovsky, as amended
10.28* Agreement dated as of October 23, 1996 by     A
       and between Leonard, Mulherin & Greene,
       P.C. and Omega Orthodontics, Inc.
10.29* Consulting Agreement by and between C.        A
       Joel Glovsky and Omega Orthodontics, Inc.
10.30* Consulting Agreement by and between           A
       Leonard, Mulherin & Greene, P.C. and
       Omega Orthodontics, Inc.
10.31  Subscription Agreement dated as of April      A
       28, 1997 by and between Omega
       Orthodontics, Inc. and David T. Grove
10.32  Management Services Agreement by and       Filed
       among Leon J. Leonard, D.M.D., P.C.,       Herewith
       Omega Orthodontics of Conyers, Inc. and    
       Omega Orthodontics, Inc.
10.33  Stock Put/Call Option and Successor        Filed
       Designation Agreement by and among Leon    Herewith
       J. Leonard, D.M.D., P.C., Leon J.          
       Leonard, D.D.S., Omega Orthodontics, Inc.
       and Omega Orthodontics of Conyers, Inc.
10.34  Non-negotiable Promissory Note from Omega  Filed
       Orthodontics, Inc. payable to Leon         Herewith
       Leonard                                    
10.35  Management Services Agreement by and       Filed
       among David W. Longworth, P.C., Omega      Herewith
       Orthodontics of Watertown, Inc. and Omega  
       Orthodontics, Inc.
10.36  Stock Put/Call Option and Successor        Filed
       Designation Agreement by and among David   Herewith
       W. Longworth, P.C., David Longworth,       
       D.D.S., Omega Orthodontics, Inc. and
       Omega Orthodontics of Watertown, Inc.
10.37  Non-negotiable Promissory Note from Omega  Filed
       Orthodontics, Inc. payable to David W.     Herewith
       Longworth Trust and Jacquelyn L.           
       Longworth Trust
10.38  Management Services Agreement by and       Filed
       among Rodney A. Gray, D.D.S., M.S., Ltd.,  Herewith
       Omega Orthodontics of Reno, Inc. and       
       Omega Orthodontics, Inc.
10.39  Stock Put/Call Option and Successor        Filed
       Designation Agreement by and among Rodney  Herewith
       A. Gray, D.D.S., M.S., Ltd., Rodney A.     
       Gray, D.D.S., Omega Orthodontics, Inc.
       and Omega Orthodontics of Reno, Inc.
10.40  Non-negotiable Promissory Note from Omega  Filed
       Orthodontics, Inc. payable to Rodney A.    Herewith
       Gray                                       
10.41  Management Services Agreement by and       Filed
       among Scott E. Feldman, D.D.S., M.S.,      Herewith
       Inc., Omega Orthodontics of Reseda, Inc.   
       and Omega Orthodontics, Inc.
10.42  Management Services Agreement by and       Filed
       among Richard H. Villa, D.M.D., P.C.,      Herewith
       Omega Orthodontics of Virginia, Inc. and   
       Omega Orthodontics, Inc.
10.43  Stock Put/Call Option and Successor        Filed
       Designation Agreement by and among         Herewith
       Richard H. Villa, D.M.D., P.C., Richard    
       H. Villa, D.M.D., Omega Orthodontics,
       Inc. and Omega Orthodontics of Virginia,
       Inc.
10.44  Non-negotiable Promissory Note from Omega  Filed
       Orthodontics, Inc. payable to Richard H.   Herewith
       Villa, D.M.D.                              
10.45* Consulting Agreement by and between Dean   Filed
       C. Bellavia and Omega Orthodontics, Inc.   Herewith
                                                  
10.46  Demand Note dated December 3, 1997 made    Filed
       by Robert J. Schulhof in favor of Omega    Herewith
       Orthodontics, Inc.                         
10.47  Management Services Agreement by and       Filed
       among Daniel Azani, D.D.S., Inc., Azani    Herewith
       Dental Services, Inc. and Omega            
       Orthodontics, Inc.
10.47a Amendment to Management Services           Filed
       Agreement by and among Daniel Azani,       Herewith
       D.D.S., Inc., Azani Dental Services, Inc.  
       and Omega Orthodontics, Inc.
10.48  Stock Put/Call Option and Successor        Filed
       Designation Agreement by and among Daniel  Herewith
       Azani, D.D.S., Inc., Daniel Azani,         
       D.D.S., Azani Dental Services, Inc. and
       Omega Orthodontics, Inc.
10.48a Amendment to Stock Put/Call Option and     Filed
       Successor Designation Agreement by and     Herewith
       among Daniel Azani, D.D.S., Inc., Daniel   
       Azani, D.D.S., Azani Dental Services,
       Inc. and Omega Orthodontics, Inc.
10.49* Consulting Agreement by and between Peter  Filed
       I. Wexler and Omega Orthodontics, Inc.     Herewith
                                                  
10.50  Non-negotiable Promissory Note from Omega  Filed
       Orthodontics, Inc. payable to Daniel       Herewith
       Azani, D.D.S.                              
16.1   Letter addressed to the Securities and        B
       Exchange Commission dated January 15,
       1998, from the Company's former auditors,
       Ernst & Young LLP, relative to their
       agreement with the statements made in
       Item 4 of the Company's Current Report on
       Form 8-K
21.1   List of Subsidiaries of Omega              Filed
       Orthodontics, Inc.                         Herewith
                                                  
27.1   Financial Data Schedule                    Filed
                                                  Herewith
                                                  
____________________
A  Incorporated   by  reference  to  the  Company's  registration
   statement  on  Form  SB-2, as amended (Registration  No.  333-
   27179).   The  number set forth herein is the  number  of  the
   Exhibit in said registration statement, as amended.

B  Incorporated  by  reference to Exhibit 16.1 to  the  Company's
   Current Report on Form 8-K dated January 14, 1998.

*  Management contract or compensatory plan or arrangement.

**  In accordance with Rule 12b-32 under the Securities Exchange Act
of  1934,  as amended, reference is made to the documents previously
filed  with the Securities and Exchange Commission, which  documents
are hereby incorporated by reference.

(b)    Reports on Form 8-K

   None.
                                
                           SIGNATURES

    In  accordance with Section 13 or 15(d) of the Exchange  Act,
the  registrant caused this report to be signed on its behalf  by
the undersigned, thereunto duly authorized.


                            OMEGA ORTHODONTICS, INC.

                            By  /s/ Robert J. Schulhof
                                Robert J. Schulhof,
                                Chief Executive Officer


In  accordance with the Securities Exchange Act, this report  has
been  signed  below by the following persons  on  behalf  of  the
registrant and in the capacities and on the dates indicated.

     Signature               Title                  Date
                                            
/s/ Robert J.Schulhof Director, President      April 14, 1998
 Robert J. Schulhof   and Chief Executive
                      Officer (Principal
                      Executive Officer
                                            
                                            
/s/Edward M. Mulherin Chief Financial          April 14, 1998
 Edward M. Mulherin   Officer (Principal
                      Financial and
                      Accounting Officer
                                            
                                            
/s/ Dean C. Bellavia        Director           April 14, 1998
  Dean C. Bellavia                                    
                                                      
                                            
/s/John J. Clarke, Jr.      Director           April 14, 1998
John J. Clarke, Jr.                                   

/s/ Floyd V. Elliott        Director           April 14, 1998
  Floyd V. Elliott                                    
                                            
/s/ C. Joel Glovsky         Director           April 14, 1998
  C. Joel Glovsky                                     
                                                      
/s/ David T. Grove          Director           April 14, 1998
   David T. Grove                                     
                                                      
                          EXHIBIT INDEX

Exhibit
 No.  Exhibit Description                        Reference
                                                  
2.1    Asset Purchase Agreement dated as of          A
       August 31, 1996 by and between Omega
       Orthodontics, Inc. and The Orthodontic
       Management Effectiveness Group of
       America, LLC
2.2    Form of Affiliation Agreement and             A
       Agreement and Plan of Merger by and among
       Omega Orthodontics, Inc., Robert R.
       Schmisseur, D.D.S. and Robert R.
       Schmisseur, D.D.S., M.S., P.C., as
       amended
2.3    Affiliation Agreement and Agreement and       A
       Plan of Merger by and among Omega
       Orthodontics, Inc., Theodore G. Saydyk,
       Jr., D.D.S. and Theodore G. Saydyk, Jr.,
       D.D.S., P.C., as amended
2.4    Form of Affiliation Agreement and Asset       A
       Purchase Agreement by and among Omega
       Orthodontics, Inc. and Scott E. Feldman,
       D.D.S.
2.5    Form of Affiliation Agreement and Stock       A
       Purchase Agreement by and between Omega
       Orthodontics, Inc. and David T. Grove,
       D.M.D.
2.6    Form of Affiliation Agreement and Asset       A
       Purchase Agreement by and between Omega
       Orthodontics, Inc. and David T. Grove,
       D.M.D.
2.7    Affiliation Agreement and Agreement and       A
       Plan of Merger by and among Omega
       Orthodontics, Inc., Michael G. Churosh,
       D.D.S. and Michael G. Churosh, D.D.S.,
       M.S., LTD., as amended
2.8    Affiliation Agreement and Agreement and       A
       Plan of Merger by and among Omega
       Orthodontics, Inc., Clark E. Schneekluth,
       D.D.S. and Clark E. Schneekluth, D.D.S.,
       P.C., as amended
2.9    Affiliation Agreement and Asset Purchase   Filed
       Agreement by and between Omega             Herewith
       Orthodontics, Inc. and Leon J. Leonard,    
       D.D.S.
2.10   Affiliation Agreement and Asset Purchase   Filed
       Agreement by and between Omega             Herewith
       Orthodontics, Inc. and David Longworth,    
       D.D.S.                                     
2.11   Affiliation Agreement and Asset Purchase   Filed
       Agreement by and between Omega             Herewith
       Orthodontics, Inc. and Rodney A. Gray,     
       D.D.S.
2.12   Agreement for the Purchase and Sale of     Filed
       Assets by and between Sharon M. Crowder,   Herewith
       D.D.S., Inc. and Omega Orthodontics of     
       Reseda, Inc.
2.13   Affiliation Agreement and Agreement and    Filed
       Plan of Merger by and among Omega          Herewith
       Orthodontics of Woodland Hills, Inc.,      
       Omega Orthodontics, Inc., Sharon M.
       Crowder, D.D.S., Scott E. Feldman, D.D.S.
       and Omega Orthodontics of Reseda, Inc.
2.14   Affiliation Agreement and Asset Purchase   Filed
       Agreement by and among Omega               Herewith
       Orthodontics, Inc., Richard H. Villa,      
       D.D.S. and Richard H. Villa, D.D.S., Inc.
2.15   Affiliation Agreement and Agreement and    Filed
       Plan of Merger by and among Omega          Herewith
       Orthodontics of Woodland Hills, Inc.,      
       Omega Orthodontics, Inc., Azani Dental
       Services, Inc., Daniel Azani, D.D.S. and
       Daniel Azani, D.D.S., Inc.
2.15a  Amendment to Affiliation Agreement and     Filed
       Plan of Merger by and among Omega          Herewith
       Orthodontics of Woodland Hills, Inc.,      
       Omega Orthodontics, Inc., Azani Dental
       Services, Inc., Daniel Azani, D.D.S. and
       Daniel Azani, D.D.S., Inc.
2.16   Affiliation Agreement and Asset Purchase   Filed
       Agreement by and among Omega               Herewith
       Orthodontics, Inc., William W. Beazley,    
       D.D.S. and William W. Beazley, D.D.S.,
       Inc.
3.1    Certificate of Incorporation of Omega         A
       Orthodontics, Inc.
3.2    Certificate of Amendment of Certificate       A
       of Incorporation of Omega Orthodontics,
       Inc. filed February 12, 1997
3.3    By-Laws of Omega Orthodontics, Inc., as       A
       amended
4.1    Specimen Certificate for Common Stock         A
4.2    Form of Subscription Agreement for            A
       private placement of 15% Senior Notes due
       September 30, 1997 (including rights to
       receive shares of Common Stock
4.3    Form of 15% Senior Notes due September        A
       30, 1997, as amended
4.4    Warrant Agreement by and between Omega        A
       Orthodontics, Inc. and Continental Stock
       Transfer & Trust Company, including form
       of Warrant
4.5    Representative's Warrant Agreement by and     A
       between National Securities Corporation
       and Omega Orthodontics, Inc., including
       form of Representative's Warrant
4.6    Form of 16% Promissory Notes due June 30,     A
       1998
10.1   Form of Management Services Agreement by      A
       and among a professional corporation to
       be formed by Dr. Schmisseur, Omega
       Orthodontics of Champaign, Inc. and Omega
       Orthodontics, Inc.
10.2   Form of Management Services Agreement by      A
       and among a professional corporation to
       be formed by Dr. Saydyk, Omega
       Orthodontics of Colorado Springs, Inc.
       and Omega Orthodontics, Inc.
10.3   Amended and Restated Management Services   Filed
       Agreement by and among Scott E. Feldman,   Herewith
       D.D.S., M.S., Inc., Omega Orthodontics of  
       Woodland Hills, Inc. and Omega
       Orthodontics, Inc.
10.4   Form of Management Services Agreement by      A
       and among a professional corporation to
       be formed by Dr. Zapalac, Omega
       Orthodontics of Austin, Inc. and Omega
       Orthodontics, Inc.
10.5   Form of Management Services Agreement by      A
       and among a professional corporation to
       be formed by Dr. Grove, Omega
       Orthodontics of Elko, Inc. and Omega
       Orthodontics, Inc.
10.6   Form of Management Services Agreement by      A
       and among a professional corporation to
       be formed by Dr. Churosh, Omega
       Orthodontics of Goodyear, Inc. and Omega
       Orthodontics, Inc.
10.7   Form of Management Services Agreement by      A
       and among a professional corporation to
       be formed by Dr. Schneekluth, Omega
       Orthodontics of Huntington Beach, Inc.
       and Omega Orthodontics, Inc.
10.8   Form of Stock Put/Call Option and             A
       Successor Designation Agreement by and
       among a professional corporation to be
       formed by Dr. Schmisseur, Robert R.
       Schmisseur, D.D.S., Omega Orthodontics,
       Inc. and Omega Orthodontics of Champaign,
       Inc.
10.9   Form of Stock Put/Call Option and             A
       Successor Designation Agreement by and
       among a professional corporation to be
       formed by Dr. Saydyk, Theodore G. Saydyk,
       Jr., D.D.S., Omega Orthodontics, Inc. and
       Omega Orthodontics of Colorado Springs,
       Inc.
10.10  Form of Stock Put/Call Option and             A
       Successor Designation Agreement by and
       among a professional corporation to be
       formed by Dr. Feldman, Scott E. Feldman,
       D.D.S., Omega Orthodontics, Inc. and
       Omega Orthodontics of Woodland Hills,
       Inc.
10.11  Form of Stock Put/Call Option and             A
       Successor Designation Agreement by and
       among a professional corporation to be
       formed by Dr. Zapalac, Jeff S. Zapalac,
       D.D.S., Inc., Omega Orthodontics, Inc.
       and Omega Orthodontics of Austin, Inc.
10.12  Form of Stock Put/Call Option and             A
       Successor Designation Agreement by and
       among a professional corporation to be
       formed by Dr. Grove, David T. Grove,
       D.M.D., Omega Orthodontics, Inc. and
       Omega Orthodontics of Elko, Inc.
10.13  Form of Stock Put/Call Option and             A
       Successor Designation Agreement by and
       among a professional corporation to be
       formed by Dr. Churosh, Michael G.
       Churosh, D.D.S., Omega Orthodontics, Inc.
       and Omega Orthodontics of Goodyear, Inc.
10.14  Form of Stock Put/Call Option and             A
       Successor Designation Agreement by and
       among a professional corporation to be
       formed by Dr. Schneekluth, Clark E.
       Schneekluth, D.D.S., Omega Orthodontics,
       Inc. and Omega Orthodontics of Huntington
       Beach, Inc.
10.15  Form of Non-negotiable Promissory Note        A
       from Omega Orthodontics, Inc. payable to
       Robert R. Schmisseur
10.16  Form of Non-negotiable Promissory Note        A
       from Omega Orthodontics, Inc. payable to
       Theodore G. Saydyk, Jr.
10.17  Form of Non-negotiable Promissory Note        A
       from Omega Orthodontics, Inc. payable to
       Scott E. Feldman
10.18  Form of Non-negotiable Promissory Note        A
       from Omega Orthodontics, Inc. payable to
       David T. Grove
10.19  Form of Non-negotiable Promissory Note        A
       from Omega Orthodontics, Inc. payable to
       Clark E. Schneekluth
10.20  General Assignment and Assumption             A
       Agreement dated as of August 31, 1997 by
       and between The Orthodontic Management
       Effectiveness Group of America, LLC and
       Omega Orthodontics, Inc.
10.21* Employment Agreement by and between           A
       Robert J. Schulhof and Omega
       Orthodontics, Inc.
10.22  INTENTIONALLY OMITTED                          
10.23* Employment Agreement by and between F.V.      A
       Elliott and Omega Orthodontics, Inc.
10.24* Omega Orthodontics Incentive Stock Plan,      A
       as amended
10.25  Subscription Agreement dated as of            A
       September 9, 1996 and April 28, 1997 by
       and between Omega Orthodontics, Inc. and
       C. Joel Glovsky Rollover IRA
10.26  Subscription Agreement dated as of            A
       September 25, 1996 by and between Omega
       Orthodontics, Inc. and Dean C. Bellavia.
10.27* Amended and Restated Consulting Agreement     A
       by and among Omega Orthodontics, Inc.,
       The Mayflower Group, Ltd., and C. Joel
       Glovsky, as amended
10.27a Amendment dated [March __, 1998] to the    Filed
*      Amended and Restated Consulting Agreement  Herewith
       by and among Omega Orthodontics, Inc.,     
       The Mayflower Group, Ltd., and C. Joel
       Glovsky, as amended
10.28* Agreement dated as of October 23, 1996 by     A
       and between Leonard, Mulherin & Greene,
       P.C. and Omega Orthodontics, Inc.
10.29* Consulting Agreement by and between C.        A
       Joel Glovsky and Omega Orthodontics, Inc.
10.30* Consulting Agreement by and between           A
       Leonard, Mulherin & Greene, P.C. and
       Omega Orthodontics, Inc.
10.31  Subscription Agreement dated as of April      A
       28, 1997 by and between Omega
       Orthodontics, Inc. and David T. Grove
10.32  Management Services Agreement by and       Filed
       among Leon J. Leonard, D.M.D., P.C.,       Herewith
       Omega Orthodontics of Conyers, Inc. and    
       Omega Orthodontics, Inc.
10.33  Stock Put/Call Option and Successor        Filed
       Designation Agreement by and among Leon    Herewith
       J. Leonard, D.M.D., P.C., Leon J.          
       Leonard, D.D.S., Omega Orthodontics, Inc.
       and Omega Orthodontics of Conyers, Inc.
10.34  Non-negotiable Promissory Note from Omega  Filed
       Orthodontics, Inc. payable to Leon         Herewith
       Leonard                                    
10.35  Management Services Agreement by and       Filed
       among David W. Longworth, P.C., Omega      Herewith
       Orthodontics of Watertown, Inc. and Omega  
       Orthodontics, Inc.
10.36  Stock Put/Call Option and Successor        Filed
       Designation Agreement by and among David   Herewith
       W. Longworth, P.C., David Longworth,       
       D.D.S., Omega Orthodontics, Inc. and
       Omega Orthodontics of Watertown, Inc.
10.37  Non-negotiable Promissory Note from Omega  Filed
       Orthodontics, Inc. payable to David W.     Herewith
       Longworth Trust and Jacquelyn L.           
       Longworth Trust
10.38  Management Services Agreement by and       Filed
       among Rodney A. Gray, D.D.S., M.S., Ltd.,  Herewith
       Omega Orthodontics of Reno, Inc. and       
       Omega Orthodontics, Inc.
10.39  Stock Put/Call Option and Successor        Filed
       Designation Agreement by and among Rodney  Herewith
       A. Gray, D.D.S., M.S., Ltd., Rodney A.     
       Gray, D.D.S., Omega Orthodontics, Inc.
       and Omega Orthodontics of Reno, Inc.
10.40  Non-negotiable Promissory Note from Omega  Filed
       Orthodontics, Inc. payable to Rodney A.    Herewith
       Gray                                       
10.41  Management Services Agreement by and       Filed
       among Scott E. Feldman, D.D.S., M.S.,      Herewith
       Inc., Omega Orthodontics of Reseda, Inc.   
       and Omega Orthodontics, Inc.
10.42  Management Services Agreement by and       Filed
       among Richard H. Villa, D.M.D., P.C.,      Herewith
       Omega Orthodontics of Virginia, Inc. and   
       Omega Orthodontics, Inc.
10.43  Stock Put/Call Option and Successor        Filed
       Designation Agreement by and among         Herewith
       Richard H. Villa, D.M.D., P.C., Richard    
       H. Villa, D.M.D., Omega Orthodontics,
       Inc. and Omega Orthodontics of Virginia,
       Inc.
10.44  Non-negotiable Promissory Note from Omega  Filed
       Orthodontics, Inc. payable to Richard H.   Herewith
       Villa, D.M.D.                              
10.45* Consulting Agreement by and between Dean   Filed
       C. Bellavia and Omega Orthodontics, Inc.   Herewith
                                                  
10.46  Demand Note dated December 3, 1997 made    Filed
       by Robert J. Schulhof in favor of Omega    Herewith
       Orthodontics, Inc.                         
10.47  Management Services Agreement by and       Filed
       among Daniel Azani, D.D.S., Inc., Azani    Herewith
       Dental Services, Inc. and Omega            
       Orthodontics, Inc.
10.47a Amendment to Management Services           Filed
       Agreement by and among Daniel Azani,       Herewith
       D.D.S., Inc., Azani Dental Services, Inc.  
       and Omega Orthodontics, Inc.
10.48  Stock Put/Call Option and Successor        Filed
       Designation Agreement by and among Daniel  Herewith
       Azani, D.D.S., Inc., Daniel Azani,         
       D.D.S., Azani Dental Services, Inc. and
       Omega Orthodontics, Inc.
10.48a Amendment to Stock Put/Call Option and     Filed
       Successor Designation Agreement by and     Herewith
       among Daniel Azani, D.D.S., Inc., Daniel   
       Azani, D.D.S., Azani Dental Services,
       Inc. and Omega Orthodontics, Inc.
10.49* Consulting Agreement by and between Peter  Filed
       I. Wexler and Omega Orthodontics, Inc.     Herewith
                                                  
10.50  Non-negotiable Promissory Note from Omega  Filed
       Orthodontics, Inc. payable to Daniel       Herewith
       Azani, D.D.S.                              
16.1   Letter addressed to the Securities and        B
       Exchange Commission dated January 15,
       1998, from the Company's former auditors,
       Ernst & Young LLP, relative to their
       agreement with the statements made in
       Item 4 of the Company's Current Report on
       Form 8-K
21.1   List of Subsidiaries of Omega              Filed
       Orthodontics, Inc.                         Herewith
                                                  
27.1   Financial Data Schedule                    Filed
                                                  Herewith
                                                  
____________________
A  Incorporated   by  reference  to  the  Company's  registration
   statement  on  Form  SB-2, as amended (Registration  No.  333-
   27179).   The  number set forth herein is the  number  of  the
   Exhibit in said registration statement, as amended.

B  Incorporated  by  reference to Exhibit 16.1 to  the  Company's
   Current Report on Form 8-K dated January 14, 1998.

*  Management contract or compensatory plan or arrangement.

**  In accordance with Rule 12b-32 under the Securities Exchange Act
of  1934,  as amended, reference is made to the documents previously
filed  with the Securities and Exchange Commission, which  documents
are hereby incorporated by reference.