U.S. SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

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

                                   FORM 10-QSB

               QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF

                       THE SECURITIES EXCHANGE ACT OF 1934

                  For the quarterly period ended June 30, 1998

                           Commission File No. 1-11182

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

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

      830 Bear Tavern Road, West Trenton, New Jersey                  08628-1020
      --------------------------------------------------------------------------
                    (Address of Principal Executive Offices)

                                 (609) 883-2000
                           ---------------------------
                           (Issuer's Telephone Number,
                              Including Area Code)

           Check whether the Issuer:  (1) filed all reports required to be filed
by Section 13 or 15(d) of the Securities Exchange Act of 1934 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: 
                              ---                    ---

           State  the  number  of  shares  outstanding  of each of the  Issuer's
classes of common stock, as of June 30, 1998:

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

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

           Transitional Small Business Disclosure Format (check one):

                         Yes:                    No:  X
                              ---                    ---

<PAGE>

                 BIO-IMAGING TECHNOLOGIES, INC. AND SUBSIDIARIES
                 -----------------------------------------------

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

PART I     FINANCIAL INFORMATION

     Item 1.  Financial Statements.............................................1

            CONSOLIDATED BALANCE SHEETS
            as of June 30, 1998 (unaudited) and
            September 30, 1997.................................................2

            CONSOLIDATED  STATEMENTS  OF  OPERATIONS  For the Nine  Months
            Ended June 30, 1998 and 1997
            (unaudited)........................................................3

            CONSOLIDATED  STATEMENTS  OF  OPERATIONS  For the Three Months
            Ended June 30, 1998 and 1997
            (unaudited)........................................................4

            CONSOLIDATED  STATEMENTS  OF CASH  FLOWS  For the Nine  Months
            Ended June 30, 1998 and 1997
            (unaudited)........................................................5

            NOTES TO CONSOLIDATED FINANCIAL
            STATEMENTS (unaudited).............................................6

     Item 2.  Management's Discussion and Analysis of Financial
              Condition and Results of Operations ............................10

            Results of Operations.............................................10

            Liquidity and Capital Resources...................................16

PART II    OTHER INFORMATION

     Item 1.  Legal Proceedings...............................................18

     Item 5.  Other Information...............................................19

     Item 6.  Exhibits and Reports on Form 8-K................................20

SIGNATURES ...................................................................21

                                      -i-
<PAGE>

                         PART I. FINANCIAL INFORMATION.
                         -----------------------------

ITEM 1.              FINANCIAL STATEMENTS.

           Certain information and footnote disclosures required under generally
accepted accounting principles have been condensed or omitted from the following
consolidated  financial  statements pursuant to the rules and regulations of the
Securities and Exchange Commission, although Bio-Imaging Technologies, Inc. (the
"Company") believes that such financial  disclosures are adequate to assure that
the  information  presented  is not  misleading  in any  material  respect.  The
following  consolidated  financial statements should be read in conjunction with
the year-end consolidated financial statements and notes thereto included in the
Company's  Annual Report on Form 10-KSB for the fiscal year ended  September 30,
1997.

           The results of operations for the interim  periods  presented  herein
are not  necessarily  indicative  of the results to be  expected  for the entire
fiscal year.

                                      -1-
<PAGE>


                 BIO-IMAGING TECHNOLOGIES, INC. AND SUBSIDIARIES
                 -----------------------------------------------
                           CONSOLIDATED BALANCE SHEETS
                           ---------------------------

                                                    June 30,      September 30,
                                                     1998             1997
                                                  -----------   ----------------
                                                  (unaudited)

                                     ASSETS

Current assets:

   Cash and cash equivalents.....................  $ 1,800,798    $ 2,367,658
   Accounts receivable, net......................      850,254      1,214,052
   Prepaid expenses and other current assets.....       86,761         88,518
                                                    ----------      ---------
      Total current assets.......................    2,737,813      3,670,228

Property and equipment, net......................    1,520,518      1,669,678

Other assets ....................................       32,235         67,076
                                                    ----------      ---------

      Total assets...............................  $ 4,290,566    $ 5,406,982
                                                    ==========     ==========

                      LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:

   Deferred revenue..............................  $   254,485    $   414,360
   Accounts payable..............................       79,644         81,832
   Accrued expenses and other current
     liabilities ................................      496,925        239,351
   Current maturities of long-term debt..........       64,793         87,084
                                                      --------       --------
      Total current liabilities..................      895,847        822,627
Long-term debt...................................       36,430         12,794
                                                      --------       --------
      Total liabilities..........................      932,277        835,421
                                                      --------       --------

Stockholders' equity:
 Preferred stock - $.00025 par value; authorized
  3,000,000 shares, 416,667 issued and
  outstanding ($500,000 liquidation preference)..          104            104
 Common stock - $.00025 par value; authorized
  18,000,000 shares, 7,773,878 and 7,753,878
  shares issued and  outstanding at June 30, 1998
  and September 30, 1997, respectively...........        1,944          1,939
 Additional paid-in capital......................    9,231,497      9,215,603
 Accumulated deficit.............................   (5,875,256)    (4,646,085)
                                                    -----------    -----------
  Stockholders' equity...........................    3,358,289      4,571,561
                                                    -----------    -----------

  Total liabilities and stockholders' equity.....  $ 4,290,566    $ 5,406,982
                                                   ============   ============


                 See Notes to Consolidated Financial Statements

                                      -2-
<PAGE>


                 BIO-IMAGING TECHNOLOGIES, INC. AND SUBSIDIARIES
                 -----------------------------------------------
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                      -------------------------------------
                                   (unaudited)

                                                       For the Nine Months Ended
                                                               June 30,
                                                    ----------------------------
                                                        1998          1997
                                                        ----          ----

Project revenue ................................     $ 2,930,463  $ 3,935,789

Project costs ..................................       1,478,528    1,427,218
                                                     -----------  -----------

Gross profit ...................................       1,451,935    2,508,571

General and administrative expenses ............       1,120,269    1,284,634

Sales and marketing expenses ...................         800,257      586,278

Research and development expenses ..............         194,729      170,695

Proxy and litigation expenses ..................         320,000            -

Restructuring and severance expenses ...........         277,000            -
                                                     -----------   ----------

(Loss) income from operations ..................      (1,260,320)     466,964

Interest income - net ..........................          71,434       26,912
                                                    ------------   ----------

Net (loss) income ..............................      (1,188,886)     493,876

Dividends on preferred stock ...................          30,000       30,000
                                                    -------------  ----------

Net (loss) income applicable to common stock ...   $  (1,218,886)  $  463,876
                                                    ============    =========

Basic (loss) earnings per common share..........   $      (0.16)   $     0.08
                                                   =============   ==========

Weighted average number of common
  shares........................................       7,771,672    6,152,340
                                                   =============   ==========

Diluted (loss) earnings per common share........   $      (0.16)   $     0.06
                                                   =============   ==========

Weighted average number of common and dilutive
  common equivalent shares......................       7,771,672    7,966,246
                                                   =============   ==========

                 See Notes to Consolidated Financial Statements


                                      -3-


<PAGE>


                 BIO-IMAGING TECHNOLOGIES, INC. AND SUBSIDIARIES
                 -----------------------------------------------
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                      -------------------------------------
                                   (unaudited)

                                                      For the Three Months Ended
                                                                June 30,
                                                      --------------------------
                                                           1998          1997
                                                           ----          ----

Project revenue ...................................   $   866,552    $ 1,309,388

Project costs .....................................       515,807        472,231
                                                      -----------    -----------

Gross profit ......................................       350,745        837,157

General and administrative expenses ...............       356,173        444,817

Sales and marketing expenses ......................       274,160        198,828

Research and development expenses .................        55,420         76,512

Proxy and litigation expenses .....................        38,864           --
                                                      -----------    -----------

(Loss) income from operations .....................      (373,872)       117,000

Interest income - net .............................        21,803          7,635
                                                      -----------    -----------

Net (loss) income .................................      (352,069)       124,635

Dividends on preferred stock ......................        10,000         10,000
                                                      -----------    -----------

Net (loss) income applicable to common stock ......   $  (362,069)   $   114,635
                                                      ===========    ===========

Basic (loss) earnings per common share ............   $     (0.05)   $      0.02
                                                      ===========    ===========

Weighted average number of common
  shares ..........................................     7,773,878      6,288,880
                                                      ===========    ===========

Diluted (loss) earnings per common share ..........   $     (0.05)   $      0.02
                                                      ===========    ===========

Weighted average number of common and dilutive
  common equivalent shares ........................     7,773,878      7,902,736
                                                      ===========    ===========


                 See Notes to Consolidated Financial Statements


                                      -4-
<PAGE>
<TABLE>
<CAPTION>


                            BIO-IMAGING TECHNOLOGIES, INC. AND SUBSIDIARIES
                            -----------------------------------------------
                                 CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 -------------------------------------
                                              (unaudited)
                                                                               For the Nine Months Ended
                                                                                         June 30,
                                                                               -------------------------
                                                                                   1998           1997
                                                                                   ----           ----
<S>                                                                           <C>            <C>        
Cash flows from operating activities:
 Net (loss) income ........................................................   $(1,188,886)   $   493,876
   Adjustments to reconcile net (loss) income to net cash
    (used in) provided by operating activities:
      Depreciation and amortization .......................................       423,339        508,717
      Changes in operating assets and liabilities:
        Decrease in accounts receivable ...................................       363,798        110,609
        Decrease (increase) in prepaid expenses and other current assets ..         1,757        (98,373)
        Decrease (increase) in other assets ...............................        34,841        (42,636)
        Decrease in deferred revenue ......................................      (159,875)      (199,062)
        (Decrease) increase in accounts payable ...........................        (2,188)        86,106
        Increase in accrued expenses and other current
          liabilities .....................................................       257,574         12,877
                                                                              -----------    -----------
        Net cash (used in) provided by operating activities ...............      (269,640)       872,114
                                                                              -----------    -----------

Cash flows from investing activities:
   Purchases of property and equipment ....................................      (198,585)      (865,917)
                                                                              -----------    -----------
        Net cash used in investing activities .............................      (198,585)      (865,917)
                                                                              -----------    -----------

Cash flows from financing activities:
   Payments under equipment lease obligations .............................       (74,249)       (67,677)
   Dividends paid on preferred stock ......................................       (40,285)       (41,222)
   Net proceeds from exercise of options to purchase common stock .........        15,899        283,160
   Net proceeds from exercise of warrants to purchase common stock ........          --          600,000
                                                                              -----------    -----------
        Net cash (used in) provided by financing activities ...............       (98,635)       774,261
                                                                              -----------    -----------

Net (decrease) increase in cash and cash equivalents ......................      (566,860)       780,458

Cash and cash equivalents at beginning of period ..........................     2,367,658      1,377,633
                                                                              -----------    -----------

Cash and cash equivalents at end of period ................................   $ 1,800,798    $ 2,158,091
                                                                              ===========    ===========

Supplemental disclosures of cash flow information:

   Cash paid during the period for interest ...............................   $     1,619    $     3,428
                                                                              ===========    ===========
   Equipment purchased under capital lease obligation .....................   $    75,595    $      --
                                                                              ===========    ===========
</TABLE>



                 See Notes to Consolidated Financial Statements


                                      -5-
<PAGE>



                 BIO-IMAGING TECHNOLOGIES, INC. AND SUBSIDIARIES
                 -----------------------------------------------
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                   ------------------------------------------
                                   (unaudited)


Note 1 - Basis of Presentation:

           The financial  statements  included  herein have been prepared by the
Company,  without audit, pursuant to the rules and regulations of the Securities
and Exchange  Commission.  Certain information and footnote disclosures normally
included in financial  statements prepared in accordance with generally accepted
accounting  principles have been condensed or omitted pursuant to such rules and
regulations.   These  consolidated   financial  statements  should  be  read  in
conjunction  with  the  consolidated  financial  statements  and  notes  thereto
included  in the  Company's  Annual  Report on Form  10-KSB  for the year  ended
September 30, 1997.

           In the opinion of the Company's management the accompanying unaudited
consolidated financial statements contain all adjustments,  consisting solely of
those which are of a normal  recurring  nature,  necessary to present fairly its
financial  position as of June 30, 1998,  the results of its  operations for the
three-month  and  nine-month  periods  ended June 30, 1998 and 1997 and its cash
flows for the nine-month periods ended June 30, 1998 and June 30, 1997.

           Interim  results are not  necessarily  indicative  of results for the
full fiscal year.

           Basic (loss) earnings per common share was calculated  based upon the
net (loss)  income  available  to common  stockholders  divided by the  weighted
average number of shares of Common Stock outstanding during the period.  Diluted
loss per common share for the three-month and nine-month  periods ended June 30,
1998  excludes  the impact of options  and  warrants  as they are  antidilutive.
Diluted  earnings per common share for the  three-month  and nine-month  periods
ended June 30,  1997 were  calculated  based upon the net  income  available  to
common stockholders, after giving effect to the assumed conversions of preferred
stock divided by the weighted  average number of shares of Common Stock adjusted
for the  incremental  dilution of  outstanding  options,  warrants and preferred
stock during such periods.


                                   -6-
<PAGE>

<TABLE>
<CAPTION>


                BIO-IMAGING TECHNOLOGIES, INC. AND SUBSIDIARIES
                -----------------------------------------------
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                   ------------------------------------------
                                  (unaudited)

Note 1 - Basis of Presentation: (continued)

           The computation of basic (loss) earnings per common share and diluted
(loss) earnings per common share were as follows:

                                                     Nine Months Ended           Three Months Ended
                                                         June 30,                     June 30,
                                               --------------------------    -------------------------
                                                    1998          1997           1998          1997
                                               -------------  ----------    -----------    -----------

<S>                                            <C>            <C>           <C>            <C>        
Net (loss) income ..........................   $(1,188,886)   $   493,876   $  (352,069)   $   124,635

Dividends on preferred stock ...............        30,000         30,000        10,000         10,000
                                               -----------    -----------   -----------    -----------

Net (loss) income applicable
   to common stock - basic .................   $(1,218,886)   $   463,876   $  (362,069)   $   114,635

Dilutive dividends on preferred stock ......          --           30,000          --           10,000
                                               -----------    -----------   -----------    -----------

Net (loss) income applicable
  to common stock - diluted ................    (1,218,886)       493,876      (362,069)       124,635
                                               -----------    -----------   -----------    -----------
Denominator:

  Weighted average number of
    common shares ..........................     7,771,672      6,152,340     7,773,878      6,288,880
                                               ===========    ===========   ===========    ===========
  Basic (loss) earnings per
    common share ...........................   $     (0.16)   $      0.08   $     (0.05)   $      0.02
                                               ===========    ===========   ===========    ===========

Denominator:

Weighted average number of
  common shares ............................     7,771,672      6,152,340     7,773,878      6,288,880

Common share equivalents of outstanding
  stock options and warrants ...............          --        1,397,239          --        1,197,189

Common share equivalents of dilutive
  outstanding preferred stock ..............          --          416,667          --          416,667
                                               -----------    -----------   -----------    -----------

Total shares ...............................     7,771,672      7,966,246     7,773,878      7,902,736
                                               ===========    ===========   ===========    ===========

Diluted (loss) earnings per
  common share .............................   $     (0.16)   $      0.06   $     (0.05)   $      0.02
                                               ===========    ===========   ===========    ===========


</TABLE>


                                      -7-
<PAGE>

                BIO-IMAGING TECHNOLOGIES, INC. AND SUBSIDIARIES
                -----------------------------------------------
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                   ------------------------------------------
                                  (unaudited)


Note 2 - Stockholders' Equity:

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

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

Note 3 - Litigation

           On  February  23,  1998,  five   stockholders  of  the  Company  (the
"Committee  Members")  describing  themselves  as The  Bio-Imaging  Technologies
Independent  Shareholders' Committee (the "Committee"),  as plaintiffs,  filed a
verified  complaint  and  motion in the  United  States  District  Court for the
District of New Jersey (the "New Jersey  District  Court") seeking to enjoin the
Company and each of the Company's  then current  directors,  Jeffrey S. Hurwitz,
Esq.,  Jeffrey H. Berg,  Ph.D.  and James A. Taylor,  Ph.D.  (collectively,  the
"Incumbent Directors"),  from holding the election of the Board of Directors, at
the Annual Meeting of Stockholders,  on February 27, 1998. The Committee Members
alleged,  among other things,  use of a false and  misleading  proxy  statement,
manipulation of the proxy process and manipulation of the stockholder  democracy
process in connection  with the pending  election on February 27, 1998.  The New
Jersey  District  Court,  on February 26, 1998,  denied the  Committee  Members'
application for a temporary  restraining order and denied the Committee Members'
application  for  a  preliminary  injunction.  The  New  Jersey  District  Court
determined, among other things, that the proxy statement furnished in connection
with the solicitation by the Incumbent Directors was not misleading.  Subsequent
to the  end of the  quarter,  on July  22,  1998,  the  Company  entered  into a
settlement agreement relating to such litigation. For further discussion of this
settlement  agreement,  see -- "Part  II.  Other  Information  -- Item 1.  Legal
Proceedings."


                                      -8-
<PAGE>


                BIO-IMAGING TECHNOLOGIES, INC. AND SUBSIDIARIES
                -----------------------------------------------
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                   ------------------------------------------
                                  (unaudited)


Note 3 - Litigation: (continued)

           On July 22,  1998 the  Company  and Dr.  James J.  Conklin,  a former
director  and  executive  officer of the  Company  and  member of the  Committee
("Conklin"),  executed a separation  agreement,  which contains  severance terms
(the "Separation Agreement"),  whereby the parties exchanged mutual releases and
entered  covenants not to sue. The Separation  Agreement  also  contains,  among
other things,  certain  confidentiality,  non-competition,  non-solicitation and
non-disparagement provisions. Pursuant to the terms of the Separation Agreement,
the Company will pay Conklin  $127,000.  The Company  previously  recorded  this
severance expense during the quarter ended March 31, 1998.




                                      -9-
<PAGE>



Item 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS.

RESULTS OF OPERATIONS

           The Company is a biomedical information services company that derives
its revenue primarily from medical image processing and digital image management
services to the pharmaceutical, biotechnology and medical device industries. The
Company  experienced  a loss for the three months and nine months ended June 30,
1998,  as  a  result  of  (i)  insufficient   project  revenue  to  support  the
infrastructure of the Company, (ii) a proxy contest and related litigation,  and
(iii)  restructuring  and severance  expenses  related to the elimination of two
former  business  divisions  and the  resignation  in December  1997 of a former
executive  officer.  The Company's sales cycle (the period from the presentation
by the Company to a potential  client to the  engagement  of the Company by such
client) is approximately nine months. In addition, the contracts under which the
Company is engaged to perform services  typically cover a period of 12-24 months
and the volume and type of services  performed  by the  Company  vary during the
course of a project.  In an effort to obtain  additional  contracts and generate
additional  revenue,  the Company has increased its sales and marketing  efforts
during the past year. As of June 30, 1998, the results of these efforts have not
yet been fully  realized given the lengthy sales cycle and the nature and timing
of the  services  to be  provided  by the  Company  on current  and  prospective
contracts.  No assurance  can be made that the  Company's  project  revenue will
increase to levels required to achieve and maintain profitability.  Although the
Company's  client base  increased  from 21 clients in the nine months ended June
30,  1997 to 24 clients in the nine  months  ended June 30,  1998,  the  revenue
generated  from such  client  base  remains  highly  concentrated.  Two  clients
represented  approximately  50% of the  Company's  project  revenue for the nine
months  ended  June  30,  1998,  of  which  one  European   client   represented
approximately 27% of project revenue.

           In February 1998 the Committee and management of the Company  engaged
in a proxy contest in an effort to, among other things, elect the members of the
Company's  Board of  Directors  at the Annual  Meeting of  Stockholders  held on
February  27,  1998.  In  connection  with such proxy  contest  and the  related
litigation,  the Company  expended  $320,000  in the nine months  ended June 30,
1998. For a discussion of the settlement of this  litigation see "Part II. Other
Information -- Item 1. Legal Proceedings."

           During the nine  months  ended  June 30,  1998 the  Company  recorded
restructuring  and  severance  expenses of  $277,000.  This  amount  consists of
restructuring expenses of $105,000 and severance expenses of $172,000.

           In December 1997, the Company terminated two business divisions,  the
Marketing Information Services Division (the "MISD") and the Data Management and
Information  Systems  Division (the "DMISD"),  which were established in October
1996.  These divisions did not meet the Company's  expectations  and the Company
believed that its  resources  were better  focused on its core  clinical  trials
service business.  The Company incurred  restructuring  charges of


                                      -10-
<PAGE>


approximately $105,000 which consisted of (i) $38,000 of severance costs paid to
the  former  Senior  Vice  President  and  General  Manager of the MISD and (ii)
$67,000  related  to the  write-off  of  assets  and costs  associated  with the
termination of the MISD and the DMISD.  Each of these charges has been reflected
in restructuring and severance expenses for the nine months ended June 30, 1998.
The  Company  believes  that the  restructuring  will not have an  impact on the
Company's  future  results of  operations,  liquidity  and  sources  and uses of
capital resources.

           In a separate matter,  two executive officers of the Company resigned
in December  1997. The Company  entered into the  Separation  Agreement with one
such  former  executive  officer.  The Company  will pay such  former  executive
officer  $127,000 in connection with the Separation  Agreement.  The Company has
not  entered,  and does not expect to enter,  into an  agreement  with the other
executive  officer  who  resigned  in  December  1997.  As  a  result  of  these
resignations, the Company recorded severance expenses of approximately $172,000.
Such expenses have been reflected in  restructuring  and severance  expenses for
the nine months ended June 30, 1998.

           Despite  lower  project  revenue  for the first nine months of Fiscal
1998, the Company  believes that demand for its services and  technologies  will
grow  during  the  longer  term  as the use of  digital  technologies  for  data
acquisition  and  management  increases in the  radiology  and drug  development
communities.  The  Company  also  believes  that there is a growing  recognition
within  the  bio-pharmaceutical  industry  regarding  the use of an  independent
centralized core laboratory for analysis of medical imaging data that is derived
from   clinical   trials.   In  addition,   the  United  States  Food  and  Drug
Administration  is  gaining  experience  with  electronic   submissions  and  is
continuing to develop guidelines for computerized  submission of data, including
medical  images.  Furthermore,  the increased use of digital  medical  images in
clinical  trials,  especially  for important drug classes such as neurologic and
oncologic  therapeutics and diagnostic  image agents,  generate large amounts of
image  data  that  will  require  processing,   analysis,  data  management  and
submission services. Due to several factors,  including,  without limitation, an
increase in competition, there can be no assurance that demand for the Company's
services and  technologies  will grow,  or sustain  growth,  or that  additional
revenue generating opportunities will be realized by the Company.

           Certain statements  included in the Form 10-QSB,  including,  without
limitation,  statements  regarding the anticipated growth in the markets for the
Company's  services,  the  continuation  of the trends  favoring  outsourcing of
biomedical  information  technology services by pharmaceutical and biotechnology
companies and trends  favoring the use of such  information  technologies by the
United States Food and Drug  Administration,  the anticipated longer term growth
of the Company's business, the information concerning existing client contracts,
the timing of the  projects  and  trends in future  operating  performance,  are
forward-looking  statements  within the meaning of Section 21E of the Securities
Exchange Act of 1934,  as amended.  The factors  discussed  herein,  such as the
Company's client concentration and lengthy sales cycle, the Company's ability to
obtain new  business and  accurately  estimate the timing of projects due to the
variability in size, scope and duration of projects, regulatory delays, clinical
study results which lead to  reductions or  cancellations  of projects and other
factors not within the Company's


                                      -11-
<PAGE>


control,  and others  expressed from time to time in the Company's  filings with
the  Securities  and  Exchange   Commission   could  cause  actual  results  and
developments  to be materially  different from those  expressed in or implied by
such statements.


           NINE MONTHS ENDED JUNE 30, 1998 AND 1997
           ----------------------------------------

           Project revenue for the nine months ended June 30, 1998 and 1997 were
approximately   $2,930,000   and   $3,936,000,   respectively,   a  decrease  of
approximately $1,006,000 or 25.6%. Project revenue in the nine months ended June
30, 1998 and 1997 were  derived  from 24 and 21 clients,  respectively.  Revenue
generated  from the  Company's  client base  remains  highly  concentrated.  Two
clients  represented  approximately 50% of the Company's project revenue for the
nine  months  ended  June 30,  1998 of which  one  European  client  represented
approximately 27% or $796,000 of project revenue. For the comparable period last
year,  four  clients  represented  approximately  66% of the  Company's  project
revenue of which one European  client  represented  34% or $1,338,000 of project
revenue.  The decrease in project revenue is primarily a result of a decrease in
the work performed by the Company on existing contracts  including work for such
European  client  during the nine months  ended June 30, 1998 as compared to the
same period in Fiscal  1997.  There can be no  assurance  that the Company  will
generate  revenues from such European client at historic  levels.  The Company's
scope of work in both periods included medical imaging core laboratory  services
and image-based  information management services. The Company entered into three
new  projects  with its  European  client in April  1998,  which it  expects  to
complete by the end of calendar 1999. The revenues  generated from such projects
in the nine  months  ended  June 30,  1998  were not  material.  There can be no
assurance  that  project  revenues  from such  projects  will be material in the
future.

           Project  costs for the nine months  ended June 30, 1998 and 1997 were
comprised of professional salaries and benefits and allocated overhead.  Project
costs  for the nine  months  ended  June 30,  1998 and 1997  were  approximately
$1,479,000 and $1,427,000, respectively, an increase of approximately $52,000 or
3.6%. Project costs increased slightly,  despite a decrease in project revenues,
as the  cost of  professional  salaries  and  benefits  and  allocated  overhead
expenses increased in the nine months ended June 30, 1998 and 1997.

           The gross  margin  percentage  during the nine months  ended June 30,
1998  decreased  to 49.5% from 63.7% for the  corresponding  Fiscal 1997 period.
Such decrease is attributable  primarily to constant staffing levels and the mix
of services  for which the  Company  was  engaged to  provide,  and, to a lesser
extent,  a decrease  in prices the Company  charged  for  certain  services as a
result of increased competition.

           General and administrative  expenses in each of the nine months ended
June  30,  1998  and 1997  consisted  primarily  of  professional  salaries  and
benefits,  depreciation and amortization,  professional and consulting services,
office rent and corporate  insurance.  General and administrative  expenses were
approximately   $1,120,000   in  the  nine  months   ended  June  30,  1998  and
approximately  $1,285,000  in the nine months ended June 30, 1997.  The decrease
during the nine months ended June 30, 1998 of  approximately  $165,000 or 12.8%,
from  the  corresponding


                                      -12-
<PAGE>


Fiscal 1997 period,  resulted  primarily from the elimination of expenditures in
support of the former MISD and DMISD  divisions and personnel  costs  associated
with former  executive  officers who resigned in December  1997.  Such personnel
costs are  independent  of the  expenditures  that supported the former MISD and
DMISD divisions.  The decrease in general and administrative  expenses reflects,
and is partially  offset by, a full nine months of expenses  incurred during the
Fiscal 1998 period by the Company's European facility which commenced operations
during the second quarter of Fiscal 1997.

           Sales and  marketing  expenses in each of the nine months  ended June
30,  1998  and  1997  were  comprised  of  direct  sales  and  marketing  costs,
professional  salaries and benefits and allocated overhead.  Sales and marketing
expenses were approximately  $800,000 in the nine months ended June 30, 1998 and
approximately  $586,000 in the  corresponding  Fiscal 1997 period.  The increase
during the nine months ended June 30, 1998 of approximately  $214,000, or 36.5%,
from the corresponding Fiscal 1997 period,  resulted primarily from the increase
in personnel  and resources  dedicated to sales and marketing  activities in the
United States and in Europe.

           Research  and  development  expenses in each of the nine months ended
June 30, 1998 and 1997  consisted  of  professional  salaries  and  benefits and
overhead charged to research and development projects.  Research and development
expenses during the nine months ended June 30, 1998 and 1997 were  approximately
$195,000 and $171,000,  respectively.  The increase during the nine months ended
June 30, 1998 of approximately  $24,000, or 14.0%, from the corresponding Fiscal
1997  period,  resulted  primarily  from an increase in  resources  dedicated to
research and development projects.  Research and development expenses in each of
the  nine  months  ended  June  30,  1998  and  1997  primarily  focused  on the
formulation  and  design of  product  and  process  alternatives.  There were no
capitalized  computer software development costs in either the nine months ended
June 30, 1998 or 1997. However, the Company has in the past capitalized,  and in
the future may capitalize, certain computer development costs in accordance with
the Statement of Financial Accounting Standards Board No. 86.

           Total  operating  expenses in each of the nine months  ended June 30,
1998 and 1997 consisted  primarily of project costs,  general and administrative
expenses,  sales and marketing  expenses and research and development  expenses.
The Company's total operating expenses were approximately $3,594,000 in the nine
months ended June 30, 1998 (excluding  restructuring  expenses of  approximately
$105,000,  severance expenses of approximately $172,000 and proxy and litigation
expenses  of  approximately  $320,000)  and  approximately   $3,469,000  in  the
corresponding period in Fiscal 1997. Such increase of approximately  $125,000 or
3.6% is primarily  attributable to expenses  incurred by the Company's  European
facility which commenced  operations in the second quarter of Fiscal 1997 and an
increase in the Company's sales and marketing  expenses offset,  in part, by the
elimination of  expenditures  in support of the former MISD and DMISD  divisions
and lower personnel costs due to the resignation of former executive officers in
December 1997.  Such personnel costs are  independent of the  expenditures  that
supported the former MISD and DMISD divisions.


                                      -13-
<PAGE>


           Net interest income of  approximately  $71,000 during the nine months
ended June 30, 1998, resulted from interest earned on cash balances,  offset, in
part,  by  interest   expense  incurred  in  conjunction  with  equipment  lease
obligations. The Company earned greater interest income in the nine months ended
June 30, 1998 than in the corresponding period of Fiscal 1997 due to higher cash
balances  maintained  during the Fiscal 1998  period.  Net  interest  income was
approximately $27,000 in the nine months ended June 30, 1997.

           The  Company's  net loss for the nine months  ended June 30, 1998 was
approximately  $1,189,000,  while the  Company  had net income of  approximately
$494,000 in the nine months ended June 30, 1997.  The Company's net loss for the
nine  months  ended June 30, 1998 was  attributable  primarily  to  insufficient
project  revenue to support the  infrastructure  of the  Company,  coupled  with
expenses associated with a proxy contest and related  litigation,  restructuring
expenses  related to the  elimination of the former MISD and DMISD divisions and
severance expenses  associated with the resignation in December 1997 of a former
executive officer.

           THREE MONTHS ENDED JUNE 30, 1998 AND 1997
           -----------------------------------------

           Project  revenue for the quarters ended June 30, 1998 ("Third Quarter
of Fiscal 1998") and 1997 ("Third  Quarter of Fiscal  1997") were  approximately
$867,000 and $1,309,000,  respectively,  a decrease of approximately $442,000 or
33.8%. Project revenues in the Third Quarter of Fiscal 1998 and Fiscal 1997 were
derived  from  20 and 16  clients,  respectively.  Revenue  generated  from  the
Company's  client base  remains  highly  concentrated.  Two clients  represented
approximately  58% of the Company's  project  revenue for the three months ended
June 30, 1998. For the comparable  period last year,  three clients  represented
approximately  65% of the Company's project revenue of which one European client
represented 39% or $513,000 of project revenue.  The decrease in project revenue
is  primarily  a result of a decrease  in the work  performed  by the Company on
existing  contracts for such European  client during the Third Quarter of Fiscal
1998 as compared to the Third Quarter of Fiscal 1997.  There can be no assurance
that the Company will generate  revenues  from such European  client at historic
levels.  The Company's  scope of work in both periods  included  medical imaging
core laboratory services and image-based  information  management services.  The
Company  entered into three new projects with its European client in April 1998,
which it expects to complete by the end of calendar 1999. The revenues generated
from such  projects in the three months  ended June 30, 1998 were not  material.
There can be no  assurance  that project  revenues  from such  projects  will be
material in the future.

           Project  costs in each of the Third Quarter of Fiscal 1998 and Fiscal
1997  were  comprised  of  professional  salaries  and  benefits  and  allocated
overhead.  Project  costs for the Third  Quarter of Fiscal  1998 and Fiscal 1997
were  approximately  $516,000  and  $472,000,   respectively,   an  increase  of
approximately  $44,000 or 9.3%.  This increase is primarily  attributable  to an
increase  in the  cost of  professional  salaries  and  benefits  and  allocated
overhead  expenses in the Third  Quarter of Fiscal 1998 as compared to the Third
Quarter of Fiscal 1997.


                                      -14-
<PAGE>


           The gross margin  percentage  during the Third Quarter of Fiscal 1998
decreased  to 40.5%  from  63.9%  for the  corresponding  period  in 1997.  Such
decrease is attributable to constant staffing levels and the mix of services for
which the Company was engaged to provide, and, to a lesser extent, a decrease in
prices  the  Company  charged  for  certain  services  as a result of  increased
competition.

           General and  administrative  expenses in each of the Third Quarter of
Fiscal 1998 and Fiscal 1997  consisted  primarily of  professional  salaries and
benefits,  depreciation and amortization,  professional and consulting services,
office rent and corporate  insurance.  General and administrative  expenses were
approximately  $356,000 in the Third  Quarter of Fiscal  1998 and  approximately
$445,000 in the Third  Quarter of Fiscal  1997.  The  decrease  during the Third
Quarter of Fiscal 1998 of approximately $89,000 or 20.0%, from the corresponding
Fiscal 1997 quarter,  resulted primarily from the elimination of expenditures in
support of the former MISD and DMISD  divisions and personnel  costs  associated
with former  executive  officers who resigned in December  1997.  Such personnel
costs are  independent  of the  expenditures  that supported the former MISD and
DMISD divisions.

           Sales and  marketing  expenses in each of the Third Quarter of Fiscal
1998 and  Fiscal  1997 were  comprised  of direct  sales  and  marketing  costs,
professional  salaries and benefits and allocated overhead.  Sales and marketing
expenses  were  approximately  $274,000 in the Third  Quarter of Fiscal 1998 and
approximately  $199,000 in the Third Quarter of Fiscal 1997. The increase during
the Third Quarter of Fiscal 1998 of approximately  $75,000,  or 37.7%,  from the
corresponding  Fiscal 1997  quarter,  resulted  primarily  from the  increase in
personnel  and  resources  dedicated to sales and  marketing  activities  in the
United States and in Europe.

           Research  and  development  expenses in each of the Third  Quarter of
Fiscal 1998 and Fiscal 1997 consisted of professional  salaries and benefits and
overhead charged to research and development projects.  Research and development
expenses  during the Third  Quarter of Fiscal  1998 and 1997 were  approximately
$55,000 and  $77,000,  respectively.  The decrease  during the Third  Quarter of
Fiscal 1998 of approximately  $22,000,  or 28.6%, from the corresponding  Fiscal
1997  quarter,  resulted  primarily  from a decrease in  resources  dedicated to
research and development projects.  Research and development projects during the
quarter ended June 30, 1997 also included developmental work on the product line
for the MISD  business  unit.  The  Company  terminated  such  business  unit in
December 1997. Research and development expenses in each of the Third Quarter of
Fiscal 1998 and Fiscal 1997 primarily  focused on the  formulation and design of
product and process alternatives.

           Total operating  expenses in each of the Third Quarter of Fiscal 1998
and Fiscal 1997 consisted primarily of project costs, general and administrative
expenses,  sales and marketing  expenses and research and development  expenses.
The Company's  total  operating  expenses were  approximately  $1,202,000 in the
Third  Quarter  of Fiscal  1998  (excluding  proxy and  litigation  expenses  of
approximately  $39,000, all of which in the Third Quarter of Fiscal 1998 involve
litigation expenses) and approximately  $1,192,000 in the corresponding  quarter
in Fiscal 1997.


                                      -15-
<PAGE>


Such slight  increase of  approximately  $10,000 or 0.8% is due  primarily to an
increase in the Company's sales and marketing efforts offset, for the most part,
by the  elimination  of  expenditures  in support  of the former  MISD and DMISD
divisions and personnel  costs  associated  with former  executive  officers who
resigned  in  December  1997.  Such  personnel  costs  are  independent  of  the
expenditures that supported the former MISD and DMISD divisions.

           Net interest income of approximately $22,000 during the Third Quarter
of 1998,  resulted from interest  earned on cash balances,  offset,  in part, by
interest expense incurred in conjunction with equipment lease  obligations.  The
Company earned greater  interest income in the Third Quarter of 1998 than in the
Third Quarter of Fiscal 1997 due to higher cash balances  maintained  during the
Fiscal 1998 period.  Net interest income was  approximately  $8,000 in the Third
Quarter of Fiscal 1997.

           The   Company's   net  loss  for  the  Third   Quarter  of  1998  was
approximately  $352,000,  while the  Company  had net  income  of  approximately
$125,000  in the Third  Quarter of 1997.  The  Company's  net loss for the Third
Quarter of 1998 was  attributable  primarily to insufficient  project revenue to
support the infrastructure of the Company.

LIQUIDITY AND CAPITAL RESOURCES

           At June 30,  1998,  the  Company  had cash  and cash  equivalents  of
approximately  $1,801,000.  Working  capital at June 30, 1998 was  approximately
$1,842,000.

           Net cash used in operating  activities for the nine months ended June
30, 1998 was approximately  $270,000. Such use of cash reflects the net loss for
the nine  months  ended June 30,  1998 and  changes in certain of the  Company's
operating assets and liabilities. Accounts receivable decreased by approximately
$364,000 during the nine months ended June 30, 1998 as a result of the reduction
in project  revenue  during such  period.  Deferred  revenue  also  decreased by
approximately  $160,000  as a result of a decline in advance  payments  that the
Company received on signed contracts during the nine months ended June 30, 1998.
In  addition,  accrued  expenses  and other  current  liabilities  increased  by
approximately  $258,000 due primarily to the litigation  and severance  expenses
that the Company  incurred during the nine months ended June 30, 1998. There can
be no  assurance  that such trends  will not  continue in the future or that the
continuation  of such  trends will not  adversely  affect the  Company's  future
liquidity.

           For the  nine  months  ended  June 30,  1998,  the  Company  invested
approximately  $199,000  in capital  and  leasehold  improvements.  The  Company
currently  anticipates that capital  expenditures for the balance of Fiscal 1998
will approximate $100,000.  These expenditures  represent additional upgrades in
the Company's  networking,  data storage and core laboratory  capabilities along
with similar capital requirements for its European operations.

           In June 1998, the Company paid to the holders of its Preferred  Stock
an aggregate  amount of $20,000,  which amount  represented  accrued  cumulative
dividends  for the period from  January 1, 1998 through and  including  June 30,
1998. For future dividend obligations, see "Note 2 -


                                      -16-
<PAGE>


Notes to Consolidated Financial Statements."


           The Company anticipates that its cash and cash equivalents as at June
30, 1998, together with cash from operations, will be sufficient to fund current
working  capital  needs and  capital  requirements  for at least the next twelve
months.

YEAR 2000 COMPLIANCE

           Historically,  certain computer  programs have been written using two
digits rather than four to define the applicable year, which could result in the
computer  recognizing  a date using "00" as the year 1900  rather  than the year
2000. This, in turn,  could result in major system failures or  miscalculations,
and  is  generally  referred  to as  the  "Year  2000  Problem."  The  Company's
management  information systems department has reviewed and tested the Company's
internal  business systems for Year 2000 compliance.  The Company believes that,
based on the results of such review and testing, the Company's internal business
systems,  including its computer systems, are Year 2000 compliant.  There can be
no assurance,  however, that the Year 2000 Problem will not adversely affect the
Company's business, financial condition, results of operations or cash flows.

           In  addition,  the Company  receives  imaging  data  derived from the
computer  systems of its clients,  which data or software may or may not be Year
2000  compliant.  Although the Company is currently  taking steps to address the
impact,  if any, of the Year 2000 Problem relating to the data received from its
clients,  failure of such  computer  systems to  properly  address the Year 2000
Problem  may  adversely  affect the  Company's  business,  financial  condition,
results of operations or cash flows.




                                      -17-
<PAGE>



                           PART II. OTHER INFORMATION.
                           ---------------------------

ITEM 1.    LEGAL PROCEEDINGS.

           On February 23, 1998, each of the Committee  Members,  as plaintiffs,
filed a verified  complaint and motion in the New Jersey  District Court seeking
to enjoin the Company and the Incumbent  Directors  from holding the election of
the Board of Directors,  at the Annual Meeting of Stockholders,  on February 27,
1998.  The Committee  Members  alleged,  among other things,  use of a false and
misleading proxy  statement,  manipulation of the proxy process and manipulation
of the stockholder  democracy process in connection with the pending election on
February 27, 1998. The New Jersey District  Court, on February 26, 1998,  denied
the Committee Members' application for a temporary  restraining order and denied
the Committee Members' application for a preliminary injunction.  The New Jersey
District  Court  determined,  among  other  things,  that  the  proxy  statement
furnished in connection with the solicitation by the Incumbent Directors was not
misleading.

           Subsequent to the end of the quarter,  on July 22, 1998,  the Company
and each of Jeffrey S. Hurwitz,  Esq.,  Jeffrey H. Berg, Ph.D., James A. Taylor,
Ph.D.  and Mark L.  Weinstein  (collectively,  the "Company  Group")  executed a
settlement  agreement  (the  "Settlement")  with  the  Committee,  each  of  the
Committee Members and Investment Partners of America,  L.P.  (collectively,  the
"Stockholders  Group").  The  Settlement  relates to all legal matters that have
been ongoing  since  February  1998 between the Company  Group and  Stockholders
Group.  The Settlement  calls for, among other things,  (i) mutual releases from
all parties,  (ii) an expansion of the  Company's  Board of Directors to include
two nominees of the Committee acceptable to the Company, and (iii) the execution
of the  Separation  Agreement.  The  Company  Group will  immediately  begin the
interview  process for  potential  Board  members  that will be nominated by the
Committee.   The   Settlement   also   contains   certain   non-disclosure   and
non-disparagement  provisions.  In connection with the  Settlement,  each of the
Committee  Members,  each of the Incumbent  Directors and the Company  agreed to
dismiss all claims and counterclaims asserted in their consolidated action, with
prejudice,  except for any claims  made by the Company  against  Donald W. Lohin
("Lohin").  The Company's claims against Lohin were previously dismissed without
prejudice on April 16, 1998.

           On July 22,  1998 the Company and  Conklin  executed  the  Separation
Agreement,  whereby the parties  exchanged mutual releases and entered covenants
not to sue. The Separation Agreement also contains,  among other things, certain
confidentiality,   non-competition,   non-solicitation   and   non-disparagement
provisions.  Pursuant to the terms of the Separation Agreement, the Company will
pay Conklin  $127,000.  The Company  previously  recorded this severance expense
during the quarter ended March 31, 1998.


                                      -18-
<PAGE>


ITEM 5.    OTHER INFORMATION.

           ADDITION TO THE BOARD OF DIRECTORS

           On July 22, 1998,  the Board of Directors  increased  the size of the
Board to five (5) members and elected David E. Nowicki, DMD, to fill the vacancy
created and to serve on the Company's  Board of Directors  until the next annual
meeting  of  stockholders  and until his  successor  has been duly  elected  and
qualified.  Dr. Nowicki has conducted a full time practice of  Periodontics  for
approximately   twenty  years,  and  has  been  Assistant   Clinical   Professor
(1980-1994)  and  Director  of  Postgraduate   Research  and  Literature  Review
(1984-1992) at the New Jersey Dental School, Department of Periodontics.

           NOTIFICATION FROM NASDAQ

           On March 2, 1998, the Company  received  notice from the Nasdaq Stock
Market, Inc.  ("Nasdaq"),  that the Company's Common Stock was trading below the
new minimum bid price requirement of $1.00 required for continued listing on the
Nasdaq SmallCap Market. As a result,  the Company had until May 28, 1998 for its
Common  Stock  to  trade  at or  above  the  minimum  requirement  for at  least
10-consecutive  trade days. On May 29, 1998,  the Company was notified by Nasdaq
that  based on a review of the  Company's  Common  Stock  trading  history  with
respect to the  closing  bid,  the Company  was in  compliance  with the new bid
requirement for continued  listing on Nasdaq.  The  notification  was based on a
review of the Company's Common Stock trading history with respect to the closing
bid since  February  27,  1998.  There can be no  assurance,  however,  that the
Company  will be able to  continue  to meet the Nasdaq  criteria  for  continued
listing. In the event the Company fails to meet such continued listing criteria,
the  Company's  Common  Stock  could  cease to be listed on the Nasdaq  SmallCap
Market. In such event, the Company believes that its Common Stock would continue
to  be  quoted  and  traded  on  either  the  OTC  Bulletin   Board  or  on  the
over-the-counter market. However, the Company believes that the marketability of
its  Common  Stock  would be  negatively  impacted  if moved to  either  the OTC
Bulletin Board or the  over-the-counter  market. A decrease in the marketability
of the Company's Common Stock may cause a decline in the Company's stock price.

           LEASE RENEWAL

           On June 22, 1998, the Company entered into a lease renewal  beginning
on December 1, 1998 and ending November 30, 1999 for approximately  9,100 square
feet of office space at the Company's  headquarters in West Trenton, New Jersey.
Such lease  renewal  provides  for base rent of  approximately  $9,800 per month
through  November 30, 1999. The Company  believes that these  facilities will be
adequate for its needs for the foreseeable  future,  but continuously  evaluates
its property needs.




                                      


                                      -19-
<PAGE>





           PRESIDENT AND CHIEF EXECUTIVE OFFICER

           On April 15, 1998, the Company  entered into an employment  agreement
with Mark L.  Weinstein  in  connection  with his  election  to the  offices  of
President  and Chief  Executive  Officer of the Company.  Such  agreement has an
initial term of two years with an initial annual base salary of $180,000.

ITEM 6.     EXHIBITS AND REPORTS ON FORM 8-K.

     (a)       Exhibits.

                      10.1        Employment  Agreement  dated April 15, 1998
                                  between the Company and Mark L. Weinstein.

                      27.1        Financial Data Schedule for the period ended
                                  June 30, 1998.

                      27.2        Restated  Financial Data Schedule for the
                                  period ended December 31, 1997.

                      27.3        Restated  Financial Data Schedule for the year
                                  ended  September 30, 1997.

                      27.4        Restated  Financial  Data  Schedule  for the 
                                  period  ended June 30, 1997.

                      27.5        Restated  Financial Data Schedule for the 
                                  period ended December 31, 1996.

                      27.6        Restated  Financial Data Schedule for the year
                                  ended  September 30, 1996.

                      27.7        Restated  Financial  Data  Schedule  for the 
                                  period  ended June 30, 1996.


     (b)       Reports on Form 8-K.

               None.




                                      -20-
<PAGE>






                                                              
                                   SIGNATURES

           In accordance with the requirements of the Securities Exchange Act of
1934,  the  registrant  caused  this  report to be  signed on its  behalf by the
undersigned, thereunto duly authorized.

                               BIO-IMAGING TECHNOLOGIES, INC.

DATE:   August 10, 1998        By: /S/ MARK L. WEINSTEIN
                                  ---------------------
                                  Mark L. Weinstein, President and
                                  Chief Executive Officer
                                  (Principal Executive Officer)

DATE:   August 10, 1998        By: /S/ ROBERT J. PHILLIPS
                                  ----------------------
                                  Robert J. Phillips, Vice President
                                  and Chief Financial Officer
                                  (Principal Financial and
                                  Accounting Officer)




                                      -21-
<PAGE>