OMNICARE INC, S-4, 1997-03-04

OMNICARE INC
S-4, 1997-03-04
DRUG STORES AND PROPRIETARY STORES

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<PAGE> 1

AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MARCH 4, 1997

Registration No. 333-___

================================================================================

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
____________________

FORM S-4

REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
_____________________

OMNICARE, INC.
(Exact name of registrant as specified in its charter)

DELAWARE (Primary Standard 31-1001351
(State of Incorporation) Industrial (I.R.S. Employer
Classification Code Number) Identification No.)

50 East Rivercenter Blvd. - Suite 1530
Covington, Kentucky 41011
(606) 655-1180
(Address, including zip code, and telephone number,
including area code, of registrant's principal executive offices)
_____________________

Cheryl D. Hodges
c/o Omnicare Management Company
2800 Chemed Center
255 East Fifth Street
Cincinnati, Ohio 45202-4728
(513) 762-6666
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
_____________________

Copies to:
<PAGE> 2
Morton A. Pierce John F. Bales, III
Dewey Ballantine Morgan, Lewis & Bockius
1301 Avenue of the Americas 2000 One Logan Square
New York, New York 10019 Philadelphia, Pennsylvania 19103
(212) 259-8000 (215) 963-5000
_____________________

Approximate date of commencement of proposed sale of the securities to the
public: Upon consummation of the Merger described herein.

If the securities being registered on this form are being offered in
connection with the formation of a holding company and there is compliance with
General Restriction G, check the following box. [ ]
<PAGE> 3
CALCULATION OF REGISTRATION FEE

<TABLE>
<CAPTION>
=============================================================================================================================
Title of each class of Proposed maximum Proposed maximum
securities to be Amount to be offering price per aggregate offering Amount of
registered registered(1) share(2) price(2) fee(2) registration
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock 1,894,810 N/A $1,840,019.80 $557.58
$1.00 par value shares
=============================================================================================================================
</TABLE>

(1) Represents the maximum number of shares of common stock of Omnicare, Inc.,
par value $1.00 per share, that the Registrant would issue in exchange for the
common stock of Coromed, Inc., par value $.01 per share and in respect of
options to acquire the common stock of Coromed, Inc.

(2) Calculated pursuant to Rule 457(f) under the Securities Act of 1933. The
proposed maximum aggregate offering price represents the book value of the
securities to be received by the Registrant or cancelled in the merger plus the
exercise price of the options to be cancelled in the merger.

_____________________

THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE TIME UNTIL THE REGISTRANT
SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
<PAGE> 4
PROXY STATEMENT OF
COROMED, INC.
FOR SPECIAL MEETING OF STOCKHOLDERS

TO BE HELD ________ , 1997

________________________________

PROSPECTUS

OMNICARE, INC.

Relating to the Offering of up to ____________ Shares of Common
Stock, Par Value $1.00 Per Share of Omnicare.

This Proxy Statement of Coromed, Inc., a Delaware
corporation ("Coromed"), and Prospectus of Omnicare, Inc., a Delaware
corporation ("Omnicare") (the "Proxy Statement/ Prospectus") is being furnished
to the holders of common stock of Coromed, par value $.01 per share ("Coromed
Common Stock"), in connection with the solicitation of proxies by the Board of
Directors of Coromed (the "Coromed Board") for use at the special meeting of
stockholders of Coromed to be held at on __________, 1997, and any
adjournments or postponements thereof (the "Special Meeting").

At the Special Meeting, stockholders of Coromed will
consider and vote on the proposed merger described herein, by which Coromed
Acquisition Corporation ("Merger Sub"), a Delaware corporation and wholly-owned
subsidiary of Omnicare, will merge (the "Merger") with and into Coromed and
Coromed will become a wholly-owned subsidiary of Omnicare, pursuant to the
terms of an Agreement and Plan of Merger, dated as of January 27, 1997, by and
among Omnicare, Merger Sub, Coromed and certain stockholders of Coromed (the
"Merger Agreement"). If the Merger is consummated, all holders of Coromed
Common Stock and of options to acquire Coromed Common Stock ("Coromed Options")
will receive shares of the common stock, par value $1.00 per share, of Omnicare
("Omnicare Common Stock"), with an aggregate total value equivalent to
$40,000,000.

FOR A MORE COMPLETE DESCRIPTION OF THE TERMS OF THE MERGER,
INCLUDING A DESCRIPTION OF THE CONSIDERATION TO BE RECEIVED BY COROMED
STOCKHOLDERS, SEE "THE MERGER."

Shares of Omnicare Common Stock are quoted on the New York
Stock Exchange (the "NYSE") under the symbol "OCR." There is no public trading
market for Coromed Common Stock.
<PAGE> 5
This Proxy Statement also constitutes a Prospectus relating
to the shares of Omnicare Common Stock to be issued in connection with the
proposed Merger.

The information contained in this Proxy Statement/Prospectus
relating to Omnicare has been furnished by Omnicare for inclusion herein.
Omnicare is engaged directly and through subsidiaries, in providing
professional pharmacy and related consulting services for long-term care
institutions such as nursing homes, retirement centers and other institutional
health care facilities. The principal executive offices of Omnicare are
located at 50 East Rivercenter Blvd. - Suite 1530, Covington, Kentucky 41011,
telephone number (606) 655-1180.

The information contained in this Proxy Statement/
Prospectus relating to Coromed has been furnished by Coromed for inclusion
herein. Coromed's operations consist principally of providing contract
research services to pharmaceutical, biotechnology and medical product
companies. The principal executive offices of Coromed are located at
Rensselaer Technology Park, 185 Jordan Road, Troy, New York 12180-7615,
telephone number (518) 283-4000.

This Proxy Statement/Prospectus and the accompanying proxy
cards are first being mailed to Coromed stockholders on or about __________,
1997.

FOR A DISCUSSION OF CERTAIN RISK FACTORS THAT STOCKHOLDERS
SHOULD CONSIDER BEFORE VOTING FOR OR AGAINST THE MERGER, SEE "RISK FACTORS"
BEGINNING ON PAGE ___.

____________________

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION, NOR HAS THE SECURITIES AND EXCHANGE COMMISSION
OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROXY STATEMENT/
PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.

The date of this Proxy Statement/Prospectus is , 1997.
<PAGE> 6
AVAILABLE INFORMATION

Omnicare is subject to the informational requirements of the
Securities and Exchange Act of 1934, as amended (the "Exchange Act") and in
accordance therewith files reports and other information with the Securities
and Exchange Commission (the "Commission"). Reports, proxy statements and
other information filed by Omnicare with the Commission can be inspected and
copied at the public reference facilities maintained by the Commission at Room
1024, 450 Fifth Street, N.W., Washington, D.C. 20549, and at the Commission's
Regional Offices at 7 World Trade Center, 13th Floor, New York, New York 10048
and Northwestern Atrium Center, 500 West Madison Street, Suite 1400, Chicago,
Illinois 60661. Copies of such material can be obtained from the Public
Reference Section of the Commission, 450 Fifth Street, N.W., Washington, D.C.
20549, at prescribed rates. The SEC also maintains a site on the World Wide
Web at http://www.sec.gov. that contains reports, proxy and information
statements and other information regarding registrants that file electronically
with the SEC.

Omnicare has filed with the Commission a Registration
Statement on Form S-4 (together with any amendments thereto, the "Registration
Statement") under the Securities Act of 1933, as amended (the "Securities
Act"), with respect to the shares of Omnicare Common Stock to be issued
pursuant to the proposed Merger. This Proxy Statement/Prospectus does not
contain all the information set forth in the Registration Statement, certain
portions of which have been omitted as permitted by the rules and regulations
of the Commission. Such additional information may be obtained from the
Commission's principal office in Washington, D.C. Statements contained in this
Proxy Statement/Prospectus (or in any document incorporated in this Proxy
Statement/ Prospectus by reference) as to the contents of any contract or other
document referred to herein or therein are not necessarily complete, and in
each instance reference is made to the copy of such contract or other document
filed as an exhibit to the Registration Statement or such other document, each
such statement being qualified in all respects by such reference.

Omnicare Common Stock is listed and traded on the NYSE.
Reports, proxy statements and other information concerning Omnicare can be
inspected at the NYSE, 20 Broad Street, New York, New York 10005.

No person is authorized to give any information or to make
any representation other than those contained in this Proxy
Statement/Prospectus and, if given or made, such information or representation
must not be relied upon as having been authorized by Omnicare or Coromed.
Neither the delivery of this Proxy

i
<PAGE> 7
Statement/Prospectus nor any distribution of securities registered hereunder
shall, under any circumstances, create any implication that there has been no
change in the affairs of Omnicare or Coromed since the date hereof.

INCORPORATION OF DOCUMENTS BY REFERENCE

The following documents previously filed by Omnicare with
the Commission pursuant to the Exchange Act are hereby incorporated by
reference in this Proxy Statement/Prospectus:

1. Omnicare's Annual Report on Form 10-K for the fiscal
year ended December 31, 1995 (which incorporates by reference certain
information from Omnicare's Proxy Statement relating to its 1996 Annual Meeting
of Stockholders).

2. Omnicare's Quarterly Reports on Form 10-Q for the
quarters ended March 31, 1996, June 30, 1996 and September 30, 1996.

3. Omnicare's Current Reports on Form 8-K filed February
26, 1996, May 10, 1996, September 10, 1996, February 6, 1997 and February 21,
1997; and

4. The description of Omnicare Common Stock in
Omnicare's Registration Statement on Form 8-A under the Exchange Act (File No.
1-08269) filed September 14, 1993, including all amendments and reports filed
for the purpose of updating such description.

All documents subsequently filed by Omnicare pursuant to
Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act prior to the Special
Meeting shall be deemed to be incorporated by reference herein and to be a part
hereof from the date of filing thereof. Any statement contained in a document
incorporated or deemed to be incorporated by reference herein shall be deemed
to be modified or superseded for purposes of this Proxy Statement/Prospectus to
the extent that a statement contained herein, or in any other subsequently
filed document that also is or is deemed to be incorporated by reference
herein, modifies or supersedes such statement. Any such statement so modified
or superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Proxy Statement/Prospectus.

ii
<PAGE> 8
THIS PROXY STATEMENT/PROSPECTUS INCORPORATES DOCUMENTS BY
REFERENCE WHICH ARE NOT PRESENTED HEREIN OR DELIVERED HEREWITH. THESE
DOCUMENTS ARE AVAILABLE UPON REQUEST FROM OMNICARE, INC., ATTENTION, CHERYL D.
HODGES, C/O OMNICARE MANAGEMENT COMPANY, 2800 CHEMED CENTER, 255 EAST FIFTH
STREET, CINCINNATI, OHIO 45202-4728, TELEPHONE NUMBER (513) 762-6666. IN
ORDER TO ENSURE TIMELY DELIVERY OF THE DOCUMENTS, ANY REQUEST SHOULD BE MADE BY
____________, 1997.

iii
<PAGE> 9
TABLE OF CONTENTS

<TABLE>
<CAPTION>
Page
----
<S> <C>
AVAILABLE INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . i

INCORPORATION OF DOCUMENTS BY REFERENCE . . . . . . . . . . . . . . . . . . . . . . . . ii

SUMMARY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
The Companies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
The Special Meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
The Merger . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Comparative Per Share Data (Unaudited) . . . . . . . . . . . . . . . . . . . . 9

OMNICARE AND SUBSIDIARIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
SELECTED FINANCIAL DATA . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

COROMED AND SUBSIDIARIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
SELECTED FINANCIAL DATA . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

MARKET PRICES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

DIVIDEND POLICY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

RISK FACTORS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

COROMED SPECIAL MEETING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
The Special Meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Record Date; Securities Entitled to Vote . . . . . . . . . . . . . . . . . . . 17
Quorum . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Required Vote . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Proxies and Revocation . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18

THE MERGER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Background of the Merger . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Reasons for the Merger . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Fairness Opinion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Terms of the Merger . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Exchange . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Dividends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Interests of Certain Persons in the Merger . . . . . . . . . . . . . . . . . . 25
Support Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Exclusivity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Resales of Omnicare Common Stock . . . . . . . . . . . . . . . . . . . . . . . 29
Conditions to the Merger . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Termination of the Merger Agreement . . . . . . . . . . . . . . . . . . . . . 31
Termination Fees; Expenses of the Merger . . . . . . . . . . . . . . . . . . . 32
Representations and Warranties . . . . . . . . . . . . . . . . . . . . . . . . 32
Survival of Representations and Warranties; Indemnification . . . . . . . . . 33
Governmental and Regulatory Approvals . . . . . . . . . . . . . . . . . . . . 34
Appraisal Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
Accounting Treatment of the Merger . . . . . . . . . . . . . . . . . . . . . . 37
Comparison of Stockholder Rights . . . . . . . . . . . . . . . . . . . . . . . 38

CERTAIN FEDERAL INCOME TAX CONSEQUENCES OF THE MERGER . . . . . . . . . . . . . . . . . 43
</TABLE>
<PAGE> 10
<TABLE>
<S> <C>
BUSINESS OF COROMED . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS OF COROMED . . . . . . . . . . . . . . . . . . . . . 53

BENEFICIAL OWNERSHIP OF COROMED COMMON STOCK . . . . . . . . . . . . . . . . . . . . . . . 59

EXPERTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60

LEGAL OPINIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS . . . . . . . . . . . . . . . . . . . . . . . . F-1

Appendices
- ----------

Appendix A - Agreement and Plan of Merger, dated as of A-1
January 27, 1997, by and among Omnicare,
Inc., Coromed Acquisition Corporation,
Coromed, Inc. and Certain
Stockholders of Coromed, Inc.

Appendix B - Support Agreement, dated as of January 27, B-1
1997, by and among Omnicare, Inc. ,
Coromed, Inc. and Certain Stockholders
of Coromed, Inc.

Appendix C - Section 262 of the Delaware General C-1
Corporation Law - Appraisal Rights

Appendix D - Fairness Opinion of Wessels, Arnold & D-1
Henderson, L.L.C.
</TABLE>
<PAGE> 11
SUMMARY

The following is a brief summary of certain information
contained elsewhere in this Proxy Statement/Prospectus. This summary is
qualified in its entirety by the more detailed information contained in this
Proxy Statement/Prospectus, in its Appendices and in the documents referred to
herein, to which reference is made for a more complete statement of the matters
discussed below.

THE COMPANIES

Omnicare

Omnicare is a leading independent provider of pharmacy and
related services to long-term care institutions such as nursing homes,
retirement centers and other institutional health care facilities. Omnicare
purchases, repackages and dispenses pharmaceuticals, both prescription and
non-prescription, and provides computerized medical recordkeeping and
third-party billing for patients in such facilities. Omnicare also provides
consultant pharmacist services, including evaluating monthly patient drug
therapy, monitoring the control, distribution and administration of drugs
within the nursing facility and assisting in compliance with state and federal
regulations. In addition, Omnicare provides ancillary services, such as
infusion therapy, distributes medical supplies and offers clinical care plan
and financial software information systems to its client nursing facilities.
Omnicare currently provides these services to approximately 329,000 residents
in approximately 3,900 nursing homes and other long-term care facilities
principally in the states of Alabama, Connecticut, Georgia, Illinois, Indiana,
Kansas, Kentucky, Maine, Massachusetts, Michigan, Missouri, New Jersey, New
York, North Carolina, Ohio, Oklahoma, Oregon, Pennsylvania, Virginia,
Washington, West Virginia and Wisconsin.

Omnicare's executive offices are located at 50 East
Rivercenter Blvd. - Suite 1530, Covington, Kentucky 41011, and its telephone
number is (606) 655-1180.

Coromed

Coromed is an international full-service contract research
organization ("CRO") serving multinational pharmaceutical firms and
biotechnology and medical device companies. Coromed provides support for the
preclinical and clinical development of therapeutics by offering comprehensive
and fully integrated biological, pharmacological, and chemical research
services, as well as clinical, quality assurance, data management, medical
writing, and regulatory support for its clients' clinical development programs.
In addition to North America, Coromed conducts business in South America and
Europe.
<PAGE> 12
Coromed's principal executive offices are located at Rensselaer
Technology Park, 185 Jordan Road, Troy, New York 12180-7615 and its telephone
number is (518) 283-4000.

THE SPECIAL MEETING

Time, Date and Place

The Special Meeting of the Coromed stockholders will be held
on ___________, 1997, at _________ local time, at the __________
________________ located at ____________________.

Purpose of the Meeting

At the Special Meeting, the Coromed stockholders will be
asked to consider and vote upon the proposed Merger of Merger Sub, a
wholly-owned subsidiary of Omnicare, with and into Coromed. The Merger will
result in Coromed becoming a wholly-owned subsidiary of Omnicare.

Record Date; Securities Entitled to Vote

Holders of record (the "Record Holders") of Coromed Common
Stock at the close of business on ___________, 1997 (the "Record Date"), will
be entitled to vote at the Special Meeting. On the Record Date, there were
_________ shares of Coromed Common Stock issued and outstanding. Each issued
and outstanding share of Coromed Common Stock is entitled to one vote per share
with respect to the Merger.

Quorum

The presence, in person or by proxy, of the holders of a
majority of the outstanding Coromed Common Stock entitled to vote shall
constitute a quorum. If a meeting cannot be organized because of the absence
of a quorum, those present may, except as otherwise provided by law, adjourn
the meeting to such time and place as they may determine.

Required Vote

The approval of a majority of the outstanding shares of
Coromed Common Stock is required to approve the Merger.

As of the Record Date, the following officers of Coromed:
Dr. Dale B. Evans, Chairman, President and Chief Executive Officer; Alice G.
Fedory, Executive Vice President, Chief Operations Officer and Secretary;
Thomas J. Massey, Senior Vice President, Drug Development, and Dr. Ronald E.
Weishaar, Senior Vice President, Drug Research (each, a "Principal
Stockholder") owned an aggregate of 385,047 shares of Coromed Common Stock,
representing approximately 60% of Coromed Common Stock entitled to vote on the
Merger. The Principal Stockholders and Coromed have entered into an agreement
with Omnicare (the

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<PAGE> 13
"Support Agreement") pursuant to which the Principal Stockholders have agreed,
among other things, to vote the shares of Coromed Common Stock owned by them in
favor of the Merger. Thus, in the absence of breach of the Support Agreement,
approval of the Merger is assured. Attached as Appendix B is the full text of
the Support Agreement.

THE MERGER

Pursuant to the Merger Agreement, Merger Sub will be merged
with and into Coromed and Coromed will become a wholly owned subsidiary of
Omnicare. See "THE MERGER-Terms of the Merger."

Closing Date; Effective Time

The closing date shall be the first business day immediately
following the day on which the last to be fulfilled or waived of the conditions
(see "THE MERGER-Conditions to the Merger") to the Merger Agreement are
fulfilled or waived in accordance with the Merger Agreement or such other time,
date or place as Omnicare and Coromed may agree (the "Closing Date").

Subject to the terms and conditions of the Merger Agreement,
the Merger will be effective at the time of filing of the Certificate of Merger
with the Secretary of State of the State of Delaware in accordance with the
Delaware General Corporation Law ("DGCL") or at such later time as Omnicare and
Coromed will have agreed upon and designated in such filing as the effective
time of the Merger (the "Effective Time").

Terms of the Merger

At the Effective Time, each share of Coromed Common Stock
issued and outstanding immediately prior to the Effective Time (other than
Restricted Shares (as defined in "THE MERGER-Terms of the Merger"), treasury
shares and any Dissenting Shares (as defined in "THE MERGER-Terms of the
Merger")), shall, by virtue of the Merger and without any action on the part of
the holder thereof, be converted into the right to receive such number of
shares of Omnicare Common Stock that equals the result obtained by calculation
pursuant to the following formula:

40,000,000
----------
X = Y
--------------
Z

where X is the number of shares of Omnicare Common Stock to be issued in
exchange for each share of Coromed Common Stock (the "Exchange Ratio"); Y is
the average of the closing price per share of Omnicare Common Stock on the NYSE
Composite Tape (as reported in The Wall Street Journal) on each of the five
consecutive trading days immediately preceding the second trading day prior to
the Closing Date (the "Average Closing Price"); and Z is the total number of
shares of Coromed Common Stock to be

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<PAGE> 14
exchanged in the Merger for shares of Omnicare Common Stock, including the
total number of shares of Coromed Common Stock deemed to be outstanding
immediately prior to the Effective Time in respect of and in lieu of all
Coromed Options and Restricted Shares, in each case outstanding immediately
prior to the Effective Time. Notwithstanding the foregoing, in the event that
the Average Closing Price per share of Omnicare Common Stock is $21-1/8 or
lower, or $37-1/8 or higher, then for purposes of calculating the Exchange
Ratio, the Average Closing Price will be deemed to be $21-1/8 or $37-1/8,
respectively.

At the Effective Time, each Coromed Option and each share of
Coromed Common Stock that is an "Unvested Share," as such term is defined in
the shareholders' agreement to which such share is subject (each such share, a
"Restricted Share") outstanding immediately prior to the Effective Time, by
virtue of the Merger, will be converted into the right to receive a number of
shares of Omnicare Common Stock equal to the Exchange Ratio multiplied by the
number of shares of Coromed Common Stock deemed to be outstanding with respect
to and in lieu of each such Company Option or Restricted Share, based upon the
applicable current value discount determined by Wessels, Arnold & Henderson,
L.L.C. ("Wessels") and agreed to by the independent public accountants for
Omnicare and Coromed. Notwithstanding the foregoing, no discount will be
applied with respect to the Restricted Shares if the shares of Omnicare Common
Stock pursuant to the Merger given in exchange for the Restricted Shares are
subject to the same restrictions as those restrictions imposed upon the
Restricted Shares.

Support Agreement

As a condition to Omnicare's willingness to enter into the
Merger Agreement, the Principal Stockholders executed the Support Agreement,
dated as of January 27, 1997, pursuant to which the Principal Stockholders have
agreed, among other things, (i) to vote the shares of Coromed Common Stock held
by them (the "Principal Stockholder Shares") in favor of the Merger and against
any action that would interfere with the Merger; (ii) not to sell any Principal
Stockholder Shares or engage in discussions concerning any such sale; and (iii)
to grant to Omnicare an option (the "Principal Stockholder Option") to purchase
the Principal Stockholder Shares at a purchase price per share equal to the
Exchange Ratio (calculated using the exercise date of the Principal Stockholder
Option as the deemed date of the Effective Time for purposes of calculating the
Average Closing Price). The Principal Stockholder Option is exercisable for a
one-month period following (i) the termination of the Merger Agreement under
circumstances entitling Omnicare to the termination fee described below under
"THE MERGER Termination Fees; Expenses of the Merger" or (ii) Coromed having
entered into an agreement to engage in an Acquisition Transaction (as defined
below). See "THE MERGER--Support Agreement."

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<PAGE> 15
Fairness Opinion

Wessels has acted as financial advisor to Coromed in
connection with the Merger and has assisted the Coromed Board in its
examination of the fairness, from a financial point of view, of the Merger
consideration to be received by the Coromed stockholders.

On February 19, 1997, Wessels delivered its written opinion
to the Coromed Board to the effect that, as of the date of such opinion and
based upon and subject to certain matters stated therein, the consideration to
be received by the Coromed stockholders in the Merger is fair to such
stockholders from a financial point of view. A copy of Wessels' written
opinion dated February 19, 1997, which sets forth the assumptions made,
procedures followed, matters considered, limitations on and scope of the review
by Wessels, is attached as Appendix D to this Proxy Statement/Prospectus.
Coromed stockholders are encouraged to read such opinion in its entirety. See
"THE MERGER-Fairness Opinion."

Exclusivity

Pursuant to the Merger Agreement, Coromed and its
Subsidiaries have agreed prior to the Effective Time, not to initiate, solicit
or encourage an Alternative Proposal (as defined below in "THE
MERGER-Exclusivity") or, subject to the fiduciary duties of the Coromed Board
to the Coromed stockholders, engage in any negotiations concerning, or provide
any non-public information or data, or have any discussions with any person
relating to an Alternative Proposal. See "THE MERGER--Exclusivity."

Conditions to the Merger

In addition to the required approval of the Coromed
stockholders, the Merger is subject to the satisfaction or waiver of certain
other conditions, including, without limitation: the absence of an order or
injunction of a court of competent jurisdiction which prohibits the
consummation of the Merger; the receipt of requisite governmental consents and
approvals to consummate the Merger; the accuracy of the representations and
warranties of each of the parties to the Merger Agreement; the performance of
specified obligations of each party to the Merger Agreement; the receipt of
letters from the independent public accountants of each of Coromed and Omnicare
regarding the treatment of the Merger as a "pooling of interests"; holders of
no more than 5% of the outstanding shares of Coromed Common Stock having
exercised appraisal rights; and certain other conditions. See "THE
MERGER-Conditions to the Merger."

5
<PAGE> 16
Termination

The Merger Agreement is subject to termination: (a) by
mutual consent of Omnicare and Coromed; (b) by either Omnicare or Coromed if
(i) the Merger is not consummated by September 30, 1997, (ii) the approval of
Coromed stockholders is not obtained, or (iii) upon the existence of an order,
decree or ruling by a court or governmental agency prohibiting the Merger; (c)
by the Coromed Board (i) upon exercise of its good faith judgment as to its
fiduciary duties to its stockholders if required by reason of an Alternative
Proposal or (ii) upon breach by Omnicare or Merger Sub of their representations
and warranties or agreements in the Merger Agreement; (d) by the board of
directors of Omnicare ("Omnicare Board") if (i) Coromed modifies or withdraws
its approval or recommendation of the Merger in a manner materially adverse to
Omnicare or (ii) upon breach by Coromed or the Principal Stockholders of their
representations and warranties or agreements contained in the Merger Agreement.
See "THE MERGER-Termination of the Merger Agreement."

Termination Fees; Expenses of the Merger

Under certain circumstances upon termination of the Merger
Agreement following the existence of an Alternative Proposal, Coromed would be
required to pay Omnicare a fee of $2,000,000.

All expenses incurred in connection with the Merger
Agreement will be paid by the party incurring such expenses; provided, that if
the Merger is consummated, the surviving corporation in the Merger will pay the
reasonable fees and expenses incurred by Coromed and the Principal Stockholders
in an amount up to $1,100,000 in the aggregate. See "THE MERGER-Termination
Fees; Expenses of the Merger."

Interests of Certain Persons in the Merger

The Principal Stockholders (i) have entered into the Support
Agreement with Omnicare pursuant to which they have agreed, among other things,
to vote their shares of Coromed Common Stock in favor of the Merger and have
granted to Omnicare the Principal Stockholder Option; (ii) will enter into
employment agreements with Omnicare providing that the Principal Stockholders
will maintain their current positions with Coromed, and, in the case of Dr.
Evans, providing that Omnicare will use reasonable best efforts to nominate and
elect Dr. Evans to the Coromed Board for one term following the Merger, and
providing that, as a portion of their employment compensation, the Principal
Stockholders will receive warrants to purchase an aggregate of 280,000 shares
of Omnicare Common Stock; and (iii) will enter into non-competition agreements
with Omnicare. See "THE MERGER-Interests of Certain Persons in the Merger."

6
<PAGE> 17
Governmental and Regulatory Approvals

Omnicare and Coromed do not believe that any governmental
filings in the United States are required with respect to the Merger, other
than the filing of the Certificate of Merger required to be filed with the
Secretary of State of the State of Delaware in accordance with the DGCL and the
filing of the Registration Statement of which this Proxy Statement/Prospectus
is a part with the Commission.

Appraisal Rights

If the Merger is approved by the required vote of the
Coromed stockholders and is not abandoned or otherwise terminated, holders of
Coromed Common Stock on the Record Date who did not vote for the Merger may, by
complying with the procedures prescribed in the DGCL, be entitled to appraisal
rights as described therein. Failure to comply precisely with the requirements
of the applicable provision will result in the loss of appraisal rights. See
"THE MERGER-Appraisal Rights." The obligations of Omnicare and Merger Sub to
effect the Merger are conditioned upon, among other things, holders of no more
than 5% of the outstanding shares of Coromed Common Stock having taken the
actions required to exercise appraisal rights.

Accounting Treatment of the Merger

Omnicare and Coromed believe that the Merger will qualify as
a "pooling of interests" for accounting and financial reporting purposes, and
have been so advised by their respective independent public accountants. The
consummation of the Merger is subject to receipt of (i) an opinion from Price
Waterhouse LLP, independent public accountants for Omnicare, to the effect that
the Merger will be accounted for as a "pooling of interests" for purposes of
generally accepted accounting principles and the applicable accounting rules of
the Commission and (ii) a letter from Coopers & Lybrand, L.L.P., independent
public accountants for Coromed, stating their concurrence with the conclusion
of Coromed's management that no conditions exist with respect to Coromed that
would preclude the Merger from being treated as a "pooling of interests" under
applicable United States accounting standards. Coromed's historical financial
condition and results of operations are not material to Omnicare's historical
consolidated financial statements. Accordingly, (i) Coromed's results of
operations will be included in the consolidated financial statements of
Omnicare from the date of consummation of the Merger and (ii) pro forma
financial statements are not included herein.

Certain Federal Income Tax Consequences of the Merger

The Merger is intended to qualify for federal income tax
purposes as a reorganization within the meaning of section 368(a) of the
Internal Revenue Code of 1986, as amended (the "Code"). Assuming the Merger so
qualifies, in general, no gain

7
<PAGE> 18
or loss will be recognized for federal income tax purposes by holders of
Coromed Common Stock who exchange their Coromed Common Stock for Omnicare
Common Stock pursuant to the Merger, except that gain or loss may be recognized
to the extent of cash received in lieu of fractional shares of Omnicare Common
Stock. It is a condition to the obligations of each party to consummate the
Merger that Coromed receive opinions from Morgan, Lewis & Bockius LLP, dated as
of (i) the date of this Proxy Statement/Prospectus and (ii) the Closing Date,
that, on the basis of facts, representations and assumptions set forth in such
opinions, the Merger will qualify for federal income tax purposes as a
reorganization within the meaning of section 368(a) of the Code and that
Coromed, Omnicare and Merger Sub each will be a party to such reorganization
within the meaning of section 368(b) of the Code. Holders of Coromed Common
Stock are urged to consult their own tax advisors to determine the particular
consequences of the Merger to them under federal, state, local and foreign tax
laws. For a further discussion of certain federal income tax consequences of
the Merger, see "CERTAIN FEDERAL INCOME TAX CONSEQUENCES OF THE MERGER."

8
<PAGE> 19
COMPARATIVE PER SHARE DATA (Unaudited)

The following table presents historical and pro forma per
share data for Omnicare and historical and equivalent pro forma per share data
for Coromed.

<TABLE>
<CAPTION>
Year Ended
December 31,
-------------------------------------------
1996 1995 1994
---- ---- ----
<S> <C> <C> <C>
Omnicare

Net Income:

Historical - Fully Diluted $0.61 $0.43 $0.30
Pro Forma - Fully Diluted 0.61 0.43 0.28

Dividends:
Historical 0.06 0.05 0.045
</TABLE>

<TABLE>
<CAPTION>
Six Months Ended Year Ended
December 31 June 30,
---------------- -------------------------------
1996 1996 1995 1994
------ ----- ----- ------
<S> <C> <C> <C> <C>
Coromed

Net Income:
Historical - Fully Diluted ($0.09) $1.60 $1.21 ($0.59)
Pro Forma - Fully Diluted(1) 0.55 1.01 0.71 0.47

Dividends:
Historical - - - -

Equivalent of 1.66 times cash dividend paid on each 0.05 0.10 0.08 0.07
share of Omnicare common stock (1)
</TABLE>

Book Value Per Share

On December 31, 1996, the book value of Omnicare Common
Stock was $8.24 per share. The pro forma book value per share for Omnicare
Common Stock as of such date after giving effect to the Merger would be $8.08
per share. The book value of Coromed Common Stock on December 31, 1996 was
$1.38 per share. The pro forma book value of Coromed Common Stock at such date
after giving effect to the Merger would be $13.42 per share based upon the
issuance of 1.66 shares of Omnicare Common Stock for each share of Coromed
Common Stock.(1)

____________________

(1) Pro forma amounts for Omnicare have been multiplied by 1.66 (the assumed
Exchange Ratio). The assumed Exchange Ratio has been estimated based on an
assumed Average Closing Price of the Omnicare Common Stock of $29.60 per share,

9
<PAGE> 20
which represents the average of the closing price per share of Omnicare Common
Stock on each of the five consecutive trading days ending on February 18, 1997.
The actual Average Closing Price may vary, which would result in a different
actual Exchange Ratio.

10
<PAGE> 21
OMNICARE AND SUBSIDIARIES

SELECTED FINANCIAL DATA

FIVE YEAR SUMMARY OF SELECTED FINANCIAL DATA
(in thousands, except per share data)

<TABLE>
<CAPTION>
For the years ended and at December 31,
1996 1995 1994 1993 1992
-----------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
INCOME STATEMENT DATA: (a)(b)
Sales $536,604 $399,636 $307,655 $223,129 $157,406
======== ======== ======== ======== ========
Income from continuing
operations $ 43,450(C) $ 24,760(d) $ 13,531(e) $ 10,970(f) $ 5,873
Discontinued operations (a) - - - - 8,710(g)
Cumulative effect of
accounting change - - - 280(h) -
-------- -------- -------- -------- --------
Net income $ 43,450(C) $ 24,760(d) $ 13,531(e) $ 11,250(f) $ 14,583
======== ======== ======== ======== ========

Earnings per share data
Primary:
Income from continuing
operations $ .64(C) $ .47(d) $ .30(e) $ .26(f) $ .14
Discontinued operations (a) - - - - .21(g)
Cumulative effect of
accounting change - - - - -
-------- -------- -------- -------- --------
Net income $ .64(C) $ .47(d) $ .30(e) $ .26(f) $ .35
======== ======== ======== ======== ========
Fully diluted:
Continuing operations .61(C) $ .43(d) $ .30(e) $ .26(f) $ .14
Discontinued operations (a) - - - - .21(g)
Cumulative effect of
accounting change - - - - -
-------- -------- -------- -------- --------
Net income $ .61(C) $ .43(d) $ .30(e) $ .26(f) $ .35
======== ======== ======== ======== ========
Dividends per share $ .06 $ .05 $ .045 $ .04 $ .035
======== ======== ======== ======== ========

BALANCE SHEET DATA:
Working capital $329,002 $106,384 $125,550 $ 80,570 $ 25,792
Total assets 721,697 360,836 317,205 241,318 151,403
Long-term debt (i) 1,992 82,692 85,323 86,477 7,087
Stockholders' equity (j)(k) 634,378 214,761 180,104 102,750 94,333
</TABLE>

(a) As a result of the December 1992 sale of the Veratex Group of businesses
and the divestiture of Labtronics, Inc. which was completed in 1993, results
have been restated to include these entities' results of operations as well as
any gain or loss on dispositions as "discontinued operations."
(b) Omnicare has had an active acquisition program in effect since 1989. See
Note 2 of the Notes to Consolidated Financial Statements for information
concerning these acquisitions.
(c) Includes acquisition expenses related to the 1996 "pooling of interests"
transaction of $690,000. Such expenses, on an after tax basis, were $534,000,
or $.01 per primary and fully diluted share. Net income, excluding these
expenses, was $43,984,000, or $.65 per primary share ($.61 fully diluted).
(d) Includes acquisition expenses related to the Specialized "pooling of
interests" transaction of $1,292,000. Such expenses, on an after tax basis,
were $989,000, or $.02 per primary share ($.01 fully diluted). Net income,
excluding these expenses, was $25,749,000, or $.49 per primary share ($.44 fully
diluted).
(e) Includes acquisition expenses related to the Evergreen pooling of interests
transaction of $2,380,000. Such expenses, on an after tax basis, were
$1,860,000, or $.04 per primary share ($.03 fully diluted). Net income,
excluding these expenses, was $15,391,000, or $.34 per primary share ($.33 fully
diluted).
(f) Includes a one-time cumulative tax benefit of $450,000, or $.01 per share,
arising from a change in tax laws enacted in August of 1993 relating to
amortization of intangibles.
(g) Includes after tax gain of $5,198,000, or $.12 per share, related to the
sale of the Veratex Group and the divestiture of Labtronics.
(h) After tax gain representing the cumulative effect of a change in accounting
for income taxes.
(i) In 1993, Omnicare issued $80.5 million of Convertible Subordinated Notes
due 2003. ("Notes") In 1996, all of the remaining Notes were converted into
common stock. (See Note 6 of the Notes to Consolidated Financial Statements).
(j) In 1994, Omnicare sold 6,494,964 shares of common stock, in a public
offering, resulting in net proceeds of $59,211,000.
(k) In 1996, Omnicare sold 5,750,000 (pre-1996 stock split) shares of its
common stock in a public offering, resulting in net proceeds of $279,159,000.
(See Note 7 of the Notes to Consolidated Financial Statements.)

11
<PAGE> 22
COROMED AND SUBSIDIARIES

SELECTED FINANCIAL DATA

<TABLE>
<CAPTION>
For the Six
Months Ended
December 31, For the Years Ended June 30,
------------ ----------------------------
1996 1995 1996 1995 1994 1993 1992
---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C>
INCOME STATEMENT DATA
Net Revenue $4,554,474 $4,316,467 $9,466,224 $5,655,887 $3,734,011 $3,119,141 $1,935,478
Costs and expenses:
Direct costs 3,356,083 2,429,166 5,668,041 3,199,317 2,407,862 * *

Selling, general and 1,206,523 909,960 2,240,965 1,504,810 1,397,410 * *
administrative
Depreciation and amortization 89,953 76,790 162,118 136,506 127,759 * *
Total Operating Expenses 4,652,559 3,415,916 8,071,124 4,840,633 3,933,031 * *
---------- ---------- ---------- ---------- ----------

Income (Loss) from Operations (98,085) 900,551 1,395,100 815,254 (199,020) (437,166) (93,179)
Net Income (Loss) (57,371) 692,540 1,084,265 708,695 (296,870) (477,550) (164,940)

EARNINGS PER SHARE DATA
Primary $(0.09) $1.08 $1.60 $1.21 $ (0.59) $ (1.03) $ (0.41)
Shares used in Computing 617,370 642,107 675,673 594,000 502,254 464,500 400,982
Fully Diluted $(0.09) $1.08 $1.60 $1.21 $ (0.59) $ (1.03) $ (0.41)
Shares used in Computing (617,370) 642,107 675,673 594,000 502,254 464,500 400,982

BALANCE SHEET DATA
Working Capital (Deficit) $36,921 $16,548 $234,536 $(664,091) $(1,441,553) $(1,149,580) $(565,368)
Total Assets 3,091,932 4,397,200 3,626,367 2,323,075 1,134,203 1,393,354 1,107,820
Noncurrent Liabilities 25,928 123,078 54,781 155,616 272,005 372,787 499,908
Stockholders Equity
(Deficiency) 880,866 504,194 910,693 (259,778) (1,146,417) (907,548) (518,307)
</TABLE>
__________________________

* Not available

12
<PAGE> 23
MARKET PRICES

The shares of Omnicare Common Stock are listed and
principally traded on the NYSE. The shares of Coromed Common Stock are not
traded in any established market. The following table sets forth, as of the
indicated dates, (i) the last sale price of Omnicare Common Stock and (ii) the
equivalent per share price (as explained below) of Coromed Common Stock. The
indicated dates of January 28, 1997, and __________, 1997, represent,
respectively, the last trading day immediately preceding public announcement of
the proposed acquisition by Omnicare of Coromed and the latest practicable date
prior to the mailing of this Proxy Statement/Prospectus.

<TABLE>
<CAPTION>
Omnicare Equivalent Per Share
Market Price Per Share At: Common Stock Basis of Coromed Common Stock
- -------------------------- ------------ -----------------------------
<S> <C> <C>
January 28, 1997 $28.00 $49.97
__________, 1997 $__________ $__________
</TABLE>

The equivalent per share price of Coromed Common Stock at each
specified date represents the last sale price of a share of Omnicare Common
Stock on such date multiplied by the Exchange Ratio, determined using the dates
listed above as the deemed date of the Effective Time for purposes of
calculating the Average Closing Price.

The following table sets forth the high and low closing sales
prices per share of Omnicare Common Stock as reported on the NYSE for the
quarterly periods presented below, which periods correspond to Omnicare's
quarterly fiscal periods for financial reporting purposes.

<TABLE>
<CAPTION> DIVIDEND
HIGH LOW DECLARED
---- --- --------
<S> <C> <C> <C>
FISCAL YEAR ENDED DECEMBER 31, 1996 . . . . . . . . .
First Quarter . . . . . . . . . . . . . . . . . . $27.13 $19.69 $.015
Second Quarter . . . . . . . . . . . . . . . . . 30.00 25.00 .015
Third Quarter . . . . . . . . . . . . . . . . . . 30.50 22.00 .015
Fourth Quarter . . . . . . . . . . . . . . . . . 32.13 26.13 .015

FISCAL YEAR ENDED DECEMBER 31, 1995 . . . . . . . . .
First Quarter . . . . . . . . . . . . . . . . . . $13.38 $10.31 $.0125
Second Quarter . . . . . . . . . . . . . . . . . 14.06 10.88 .0125
Third Quarter . . . . . . . . . . . . . . . . . . 19.50 13.44 .0125
Fourth Quarter . . . . . . . . . . . . . . . . . 22.38 17.06 .0125
</TABLE>

DIVIDEND POLICY

On February 7, 1996, the Omnicare Board elected to increase
the quarterly cash dividend to $.015 per share for an indicated annual rate of
$.06. On February 5, 1997, the quarterly cash dividend was increased to $.0175
per share, for an indicated annual rate of $.07 per share in 1997. It is
presently intended that cash dividends will continue to be paid on a quarterly
basis; however, future dividends are necessarily

13
<PAGE> 24
dependent upon Omnicare's earnings and financial condition and other factors
not currently determinable.

Coromed has never paid a cash dividend and currently intends
prior to the Merger to use all of its earnings in its business to finance
future growth.

14
<PAGE> 25
RISK FACTORS

Prospective investors should carefully consider the
following matters, together with the other information contained elsewhere in
this Proxy Statement/Prospectus, before making a decision with respect to the
Merger.

Acquisition Program. In accordance with its strategy for growth,
which is to build its institutional pharmacy business into a national
organization dedicated to serving the long-term care market, Omnicare is
presently engaged in a geographic expansion program which incorporates an
active acquisition program in the long-term care pharmacy industry. The
success of Omnicare's acquisition program and of its underlying growth strategy
will depend, among other things, on the continued availability of suitable
acquisition candidates. Although there presently are numerous acquisition
candidates nationwide and Omnicare to date has not had difficulty in
identifying suitable acquisition candidates, there can be no assurance that
Omnicare will consummate any additional acquisitions due to the potential for
increased competition for acquisitions from other firms seeking to enter this
market or to enhance their institutional pharmacy businesses.

Omnicare's strategy also contemplates the continued internal
growth of the acquired businesses. Any business acquisition, however, involves
inherent uncertainties, such as the effect on the acquired businesses of
integration into a larger organization and the availability of management
resources to oversee the operations of acquired businesses. Even though an
acquired business may have enjoyed excellent growth as an independent company
prior to an acquisition, there can be no assurance that such growth would
continue after an acquisition.

Regulation and Reimbursement. Omnicare's pharmacy business
is subject to federal, state and local regulations, and its pharmacies are
required to be licensed in the states in which they are located. The failure
to obtain or renew any required regulatory approvals or licenses could
adversely affect the continued operation of Omnicare's business. In addition,
the long-term care facilities that contract for Omnicare's services are also
subject to federal, state and local regulations and are required to be licensed
in the states in which they are located. The failure by these institutions to
comply with such regulations or to obtain or renew any required licenses could
result in the loss of Omnicare's ability to provide pharmacy services to their
residents. Omnicare is also subject to federal and state laws that prohibit
certain direct and indirect payments between health care providers that are
intended, among other things, to induce or encourage the referral of patients
to, or the recommendation of, a particular provider of items or services.
Violation of these laws can result in loss of licensure, civil and criminal
penalties and exclusion from the Medicare and Medicaid programs.

15
<PAGE> 26
Approximately one-half of Omnicare's pharmacy services
billings are reimbursed by government sponsored programs, largely Medicaid and
to a lesser extent Medicare, and the remainder is paid or reimbursed by
individual patients, long-term care facilities and other third party payers,
including private insurers. Medicaid and Medicare are highly regulated. The
failure, even if inadvertent, of Omnicare and/or its client institutions to
comply with applicable reimbursement regulations could adversely affect
Omnicare's business. Additionally, changes in such reimbursement programs or
in regulations related thereto, such as reductions in the allowable
reimbursement levels, modifications in the timing or processing of payments and
other changes intended to limit or decrease the growth of Medicaid and Medicare
expenditures, could adversely affect Omnicare's business.

Health Care Reform and Federal Budget Legislation. In
recent years, a number of legislative proposals have been introduced in
Congress that would effect major changes in the health care system, either
nationally or at the state level. Currently, Congress and the Clinton
Administration are considering various initiatives to establish a framework for
balancing the federal budget. These budget reduction proposals could result in
significant reductions in payments to providers under the Medicare and Medicaid
programs. With respect to Medicare, proposals include establishment of a
prospective payment system for skilled nursing facilities ("SNFs"); limits on
annual updates in payments to Medicare SNFs for routine services; consolidated
billing by a SNF for all Part A and B claims for SNF residents; and other cost
savings proposals affecting Medicare SNF services.

Federal budget proposals would also limit federal funds to
state Medicaid programs. Proposals include repealing the "Boren Amendment"
federal payment standard for Medicaid payments to Medicaid nursing facilities,
and granting greater flexibility to states to establish Medicaid managed care
projects without the need to obtain a federal waiver. Although these waiver
projects generally exempt institutional care, including nursing facility and
institutional pharmacy services, no assurances can be given that these projects
ultimately will not change the reimbursement system for long-term care,
including pharmacy services, from fee-for-service to managed care negotiated or
capitated rates. The Company anticipates that federal and state governments
will continue to review and assess alternative health care delivery systems and
payment methodologies. Due to the uncertainties regarding the final details of
reform initiatives, it is not possible to predict the effect of recent reforms
of the health care system on Omnicare's business or the prospects for or
effects of additional reforms.

16
<PAGE> 27
COROMED SPECIAL MEETING

THE SPECIAL MEETING

Time, Date and Place

The Special Meeting of Coromed stockholders will be held on
___________, 1997, at _________ local time, at the ______________ ____________
located at _______________________.

Purpose of the Special Meeting

The purpose of the Special Meeting is to consider and vote
upon the approval and adoption of the Merger Agreement pursuant to which Merger
Sub will be merged with and into Coromed and Coromed will become a wholly-owned
subsidiary of Omnicare and to transact such other business as may properly come
before the Special Meeting or any adjournments thereof.

RECORD DATE; SECURITIES ENTITLED TO VOTE

Record Holders of Coromed Common Stock at the close of
business on _________, 1997, will be entitled to vote at the Special Meeting.
On the Record Date, there were approximately ____ holders of _________ shares
of Coromed Common Stock issued and outstanding. Each issued and outstanding
share of Coromed Common Stock is entitled to one vote per share with respect to
the Merger.

QUORUM

The presence, in person or by proxy, of the holders of a
majority of the outstanding shares of Coromed Common Stock entitled to vote
shall constitute a quorum. If a meeting cannot be organized because of the
absence of a quorum, those present may, except as otherwise provided by law,
adjourn the meeting to such time and place as they may determine.

REQUIRED VOTE

The approval of a majority of the outstanding shares of
Coromed Common Stock is required to approve the Merger.

As of the Record Date, the Principal Stockholders owned an
aggregate of 385,047 shares of Coromed Common Stock, representing approximately
60% of Coromed Common Stock entitled to vote on the Merger. The Principal
Stockholders and Coromed have entered into the Support Agreement with Omnicare
pursuant to which, among other things, the Principal Stockholders have agreed
to vote the shares of Coromed Common Stock owned by them in favor of the
Merger. Thus, in the absence of breach of the Support Agreement, approval of
the Merger is assured. Attached as Appendix B is the full text of the Support
Agreement.

17
<PAGE> 28
PROXIES AND REVOCATION

All shares of Coromed Common Stock represented by properly
executed proxies received prior to or at the Special Meeting, and not revoked,
will be voted in accordance with the instructions indicated in such proxies.
If no instructions are indicated, such proxies will be voted FOR the Merger.
Shares of a Coromed stockholder who abstains from voting or whose shares are
not voted by reason of a broker non-vote (where a nominee holding shares for a
beneficial owner has not received voting instructions from the beneficial owner
with respect to a particular matter and such nominee does not possess or choose
to exercise discretionary authority with respect thereto) will be counted for
purposes of determining whether a quorum is present at the meeting so long as
the stockholder is present in person or represented by a proxy. An abstention
from voting or a broker non-vote on the Merger by a Coromed stockholder present
in person or represented by proxy at the meeting has the same legal effect as a
vote "against" the Merger. If any other business is properly brought before
the Special Meeting for consideration, the persons named in the enclosed proxy
and acting thereunder will have discretion to vote on such business in
accordance with their best judgment.

A holder of shares of Coromed Common Stock who executes and
returns the enclosed proxy may revoke his or her proxy at any time prior to its
use by (i) delivering to the Secretary of Coromed a signed notice of revocation
or a later dated signed proxy, (ii) attending the Special Meeting and voting in
person, or (iii) giving notice of revocation of the proxy at the Special
Meeting. Attendance at the Special Meeting will not in itself constitute the
revocation of a proxy. Prior to the Special Meeting, any written notice of
revocation or subsequent proxy should be sent in a manner to be received by
Coromed at or before the taking of the vote at the Special Meeting at:
Rensselaer Technology Park, 185 Jordan Road, Troy, New York 12180-7615,
Attention: Secretary, or hand delivered to the Secretary of Coromed at such
address.

In addition to solicitation by use of the mails, proxies may
be solicited by directors, officers and employees of Coromed in person or by
telephone, telegram or other means of communication. Such directors, officers
and employees will not be additionally compensated, but may be reimbursed for
reasonable out-of-pocket expenses in connection with such solicitation.

COROMED STOCKHOLDERS SHOULD NOT FORWARD STOCK CERTIFICATES
TO THE EXCHANGE AGENT UNTIL THEY HAVE RECEIVED TRANSMITTAL LETTERS. COROMED
STOCKHOLDERS SHOULD NOT RETURN STOCK CERTIFICATES WITH THE ENCLOSED PROXY.

18
<PAGE> 29
THE MERGER

This Proxy Statement/Prospectus contains a brief summary of
certain provisions of the Merger Agreement. Such summary is qualified in its
entirety by the copy of the Merger Agreement attached hereto as Appendix A,
which is incorporated herein by reference and to which reference is hereby made
for the terms thereof.

BACKGROUND OF THE MERGER

Beginning in July 1996, Coromed carefully evaluated its
long-term strategic plan for further growth in the contract research industry.
Coromed believed that it had succeeded in establishing a positive reputation in
the industry; however, as an independent, privately-held company, Coromed was
faced with the challenge of competing in an industry in which several large
publicly-traded companies were beginning to rapidly consolidate within the
industry increasing their share of the market. The outcome of Coromed's
evaluation was to seek an alliance with another company that would offer
additional resources and growth opportunities through complementary operations
to build upon Coromed's strengths.

Coromed hired Wessels, Arnold & Henderson, L.L.C., an
investment banking firm, in November 1996 in order to evaluate Coromed's
strategic alternatives to maximize shareholder value, including a potential
sale of Coromed. In late November 1996, during its examination and analysis of
various potential candidates with whom Coromed could enter into a business
combination, Wessels initiated contact with Omnicare to discuss the possibility
of a potential transaction.

Although Omnicare is primarily a provider of institutional
pharmacy services for residents of long-term care facilities, it has pursued a
strategy of seeking additional growth opportunities by leveraging its
capabilities and advancing its clinical expertise in the management of
pharmaceutical care. To meet this objective, Omnicare identified the CRO
market as an industry which could advance Omnicare's clinical pharmaceutical
capabilities as well as leverage its existing assets, including its geriatric
formulary, its extensive database on the institutionalized geriatric
population, its substantial customer base and its relationships with the major
pharmaceutical companies.

Following initial discussions with Wessels as to the
possible acquisition of Coromed, Omnicare expressed preliminary interest in
pursuing a potential transaction. On November 29, 1996, Omnicare and Wessels,
on behalf of Coromed, entered into a Confidentiality Agreement. On December
11, 1996, Joel F. Gemunder, President of Omnicare, and several other Omnicare
representatives, met with the executive officers of Coromed and with a
representative of Wessels in Albany, New York, to discuss the possibility of a
merger, and determined to continue

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discussions. The parties continued to discuss the terms of a potential
transaction, and on December 20, 1996, a Letter of Intent was signed between
Omnicare, Coromed and the Principal Stockholders (the "Letter of Intent") which
provided for, among other things, the structure of, and consideration payable
in, the Merger, the execution of employment and non-competition agreements with
the Principal Stockholders, and the agreement of the Principal Stockholders to
vote in favor of the proposed transaction. Following execution of the Letter
of Intent, Omnicare retained Montgomery Securities to act as its financial
advisor in connection with the Merger. Shortly thereafter, Omnicare and its
financial and legal advisors began a due diligence investigation of Coromed.
During the next several weeks, the parties, together with their respective
legal counsel, negotiated the Merger Agreement and the Support Agreement, as
well as the forms of employment agreement and non-competition agreement to be
executed by the Principal Stockholders. The Merger Agreement and the Support
Agreement were executed on January 27, 1997. On January 27, 1997, the Coromed
Board unanimously approved the adoption of the Merger Agreement and the Support
Agreement. On January 28, 1997, the Omnicare Board unanimously approved the
adoption of the Merger Agreement and the Support Agreement.

REASONS FOR THE MERGER

The Coromed Board believes that the Merger is fair to and in
the best interests of Coromed and its stockholders. The Coromed Board has
approved and recommends that all Coromed stockholders vote for the proposed
Merger. In approving the Merger Agreement and the transactions contemplated
thereby, the Coromed Board considered a number of factors, including:

(i) the business, results of operations, properties and
financial condition of Coromed and Omnicare and the
competitive nature of the CRO industry. The CRO industry
consists of several hundred small, limited service
providers, several medium-sized CROs, and a few full-service
global drug development companies. The CRO industry is
consolidating and, in recent years, several large,
full-service competitors have emerged. Following the
Merger, Coromed will benefit from being part of a large
organization with greater resources, which the Coromed Board
believes will improve Coromed's competitive position;

(ii) the terms and conditions of the Merger, including the fact
that Coromed stockholders will receive shares of Omnicare
Common Stock which are listed on the NYSE, thereby providing
liquidity for their investment;

(iii) the expectation that the Merger will qualify as a tax-free
reorganization for federal income tax purposes, thereby not
requiring the Coromed stockholders to

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recognize upon consummation of the Merger any gain on their
investment;

(iv) the nature of expressions of interest in a potential
transaction received by Coromed prior to the execution of
the Letter of Intent with Omnicare in connection with
Wessels' exploration of Coromed's strategic alternatives;

(v) the oral advice of Wessels with respect to the value and
fairness of the Merger delivered to certain members of the
Coromed Board prior to Coromed's execution of the Merger
Agreement; and

(vi) the terms of the Support Agreement and the fact that
Omnicare required the Support Agreement as a condition to
Omnicare's entering into the Merger Agreement.

In view of the variety of factors considered in connection
with its evaluation of the Merger, the Coromed Board found it impractical to,
and did not, quantify or attempt to assign relative weight to the specific
factors considered in reaching its determination.

The Omnicare Board believes that the acquisition of Coromed
is fair to and in the best interest of Omnicare and its stockholders. In
reaching such determination, the Omnicare Board considered a number of factors,
including the following:

(i) Omnicare's due diligence review of Coromed, including its
business, operations, management, earnings and financial
condition on a historical and prospective basis;

(ii) the leveraging, through the Merger with Coromed, of
Omnicare's existing assets, including its geriatric
pharmaceutical drug formulary, its large geriatric patient
base and its ability to capture data for disease and
outcomes management analysis;

(iii) the terms and conditions of the Merger Agreement and the
Support Agreement and the views of Omnicare's financial
advisor with respect to the Merger;

(iv) the business reputation and experience of Coromed's
management and the fact that such management will remain in
place following the Merger; and

(v) the expectation that the Merger will be tax-free for federal
income tax purposes to Omnicare.

In view of the variety of factors considered in connection
with its evaluation of the Merger, the Omnicare Board found it impractical to,
and did not, quantify or attempt to

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assign relative weight to the specific factors considered in reaching its
determination.

FAIRNESS OPINION

On February 19, 1997, Wessels delivered its written opinion
to the Coromed Board to the effect that, as of the date of such opinion and
based upon and subject to certain matters stated therein, the consideration to
be received by the stockholders of Coromed in the Merger is fair to such
stockholders from a financial point of view. The written opinion confirms
Wessels' oral advice delivered to certain members of the Coromed Board prior to
Coromed's execution of the Merger Agreement. A copy of Wessels' written
opinion dated February 19, 1997, which sets forth the assumptions made,
procedures followed, matters considered and limitations on and scope of the
review by Wessels is attached as Appendix D to this Proxy Statement/Prospectus.
Coromed stockholders are encouraged to read such opinion in its entirety.

In connection with its review of the Merger, and in arriving
at its opinion, Wessels: (i) reviewed and analyzed the financial terms of the
Merger Agreement; (ii) reviewed and analyzed certain publicly available
financial statements and other information of Omnicare; (iii) reviewed and
analyzed certain internal financial statements and other financial and
operating data concerning Coromed prepared by the management of Coromed; (iv)
reviewed and analyzed certain financial projections concerning Coromed prepared
by the management of Coromed; (v) reviewed and analyzed certain financial
projections concerning Omnicare prepared by institutional equity research
analysts; (vi) conducted discussions with members of the senior management of
Coromed with respect to the business and prospects of Coromed; (vii) reviewed
the historical and projected financial performance and market valuation of
certain comparable publicly traded companies; and (viii) reviewed the financial
terms, to the extent publicly available, of certain comparable transactions. In
addition, Wessels conducted such other analyses and examinations and considered
such other financial, economic and market criteria as it deemed necessary or
appropriate in arriving at its opinion.

As set forth in its fairness opinion, in rendering its
opinion, Wessels assumed and relied upon the accuracy and completeness of the
financial, legal, tax and other information provided to it by Coromed and
Omnicare, and has not independently verified such information. Wessels has not
performed an independent evaluation or appraisal of any of the respective
assets or liabilities of Coromed or Omnicare and it has not been

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furnished with any such valuations or appraisals. With respect to Coromed's
financial forecasts, Wessels assumed that they have been reasonably prepared on
the bases reflecting the best currently available estimates and judgments of
the management of Coromed as to the future financial performance of Coromed.
Wessels further assumed that the financial forecasts prepared by institutional
equity research analysts about Omnicare were reasonably prepared on the bases
reflecting the best currently available estimates and judgments of such
analysts as to the future financial performance of Omnicare. Wessels also
assumed that the Merger would qualify for "pooling of interests" accounting
treatment and as a tax-free transaction for the stockholders of Coromed.

The opinion of Wessels is necessarily based upon market,
economic and other conditions as they existed on, and can be evaluated as of,
the date hereof.

Wessels, as part of its investment banking services, is
regularly engaged in the valuation of businesses and their securities in
connection with mergers, corporate restructurings, negotiated underwriting,
secondary distributions of listed and unlisted securities, private placements
and valuations for corporate and other purposes. Wessels acted as financial
advisor to the Coromed Board of Directors in connection with the Merger and
will receive fees for its services, including the rendering of this opinion,
equal to 2% of the aggregate transaction value paid to the stockholders of
Coromed.

TERMS OF THE MERGER

At the Effective Time, each share of Coromed Common Stock
issued and outstanding immediately prior to the Effective Time (other than
Restricted Shares, treasury shares and any Dissenting Shares (as defined
below)), shall, by virtue of the Merger and without any action on the part of
the holder thereof, be converted into the right to receive such number of
shares of Omnicare Common Stock that equals the result obtained by calculation
pursuant to the following formula:

40,000,000
----------
X = Y
--------------
Z

where X constitutes the Exchange Ratio and represents the number of shares of
Omnicare Common Stock to be issued in exchange for each share of Coromed Common
Stock; Y is the Average Closing Price per share of Omnicare Common Stock on the
NYSE Composite Tape (as reported in The Wall Street Journal) on each of the
five consecutive trading days immediately preceding the second trading day
prior to the Closing Date; and Z is the total number of shares of Coromed
Common Stock to be exchanged in the Merger for shares of Omnicare Common Stock,
including the total number of shares of Coromed Common Stock deemed to be
outstanding immediately prior to the Effective Time in respect of and in lieu

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<PAGE> 34
of all Coromed Options and Restricted Shares, in each case outstanding
immediately prior to the Effective Time. Notwithstanding the foregoing, in the
event that the Average Closing Price per share of Omnicare Common Stock is
$21-1/8 or lower, or $37-1/8 or higher, then for purposes of calculating the
Exchange Ratio, the Average Closing Price will be deemed to be $21-1/8 or
$37-1/8, as the case may be, respectively.

At the Effective Time, each Coromed Option and each
Restricted Share outstanding immediately prior to the Effective Time shall, by
virtue of the Merger and without any action on the part of the holder thereof,
be converted into the right to receive such number of shares of Omnicare Common
Stock that equals the Exchange Ratio multiplied by the number of shares of
Coromed Common Stock deemed to be outstanding with respect to and in lieu of
each such Coromed Option and each such Restricted Share outstanding immediately
prior to the Effective Time based upon the applicable current value discount
determined by Wessels and agreed to by Coopers & Lybrand L.L.P., independent
public accountants for Coromed, and Price Waterhouse LLP, independent public
accountants for Omnicare. Notwithstanding the foregoing, no discount will be
applied with respect to the Restricted Shares if the shares of Omnicare Common
Stock pursuant to the Merger given in exchange for the Restricted Shares are
subject to the same restrictions as those restrictions imposed upon the
Restricted Shares.

Each share of Coromed Common Stock issued and held in
Coromed's treasury at the Effective Time shall, by virtue of the Merger, cease
to be outstanding and shall be cancelled and retired without payment of any
consideration thereof.

As of the Effective Time, Omnicare shall deposit with the
Exchange Agent, for the benefit of holders of shares of Coromed Common Stock
and/or Coromed Options, certificates representing the shares of Omnicare Common
Stock and cash in lieu of fractional shares.

EXCHANGE

Promptly after the Effective Time, Omnicare shall cause the
Exchange Agent to mail to each Record Holder of Coromed Common Stock or Coromed
Options (i) a letter of transmittal for delivery of the certificates
representing such shares of Coromed Common Stock and/or for the delivery of
forms of unexercised Coromed Option grants (each, a "Certificate") for
certificates of Omnicare Common Stock and (ii) instructions pertaining to the
above-referenced letter of transmittal.

Upon proper completion of such letter of transmittal, and
upon delivery of both the letter of transmittal and the Certificates to the
Exchange Agent, such holder shall be entitled to receive (i) a certificate
representing that number of whole shares of Omnicare Common Stock and (ii) a
check representing the

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<PAGE> 35
amount of cash in lieu of fractional shares, if any, that the holder has the
right to receive.

DIVIDENDS

No dividends or other distributions declared after the
Effective Time on Omnicare Common Stock shall be paid with respect to any
shares of Coromed Common Stock represented by a Certificate until such
Certificate is surrendered for exchange as provided herein. Subject to the
effect of applicable law, following surrender of any such Certificate, there
shall be paid to the holder, without interest, the amount of dividends or other
distributions payable to holders of Omnicare Common Stock of record as of any
date after the Effective Time with respect to the number of whole shares of
Omnicare Common Stock for which such Certificate is exchanged. Dividends or
other distributions with a payment date after the Effective Time but prior to
surrender of the Certificate will be paid at the time of surrender, and
dividends or other distributions with a payment date subsequent to surrender
will be payable on the applicable payment date, in each case less the amount of
any withholding taxes which may be required thereon.

INTERESTS OF CERTAIN PERSONS IN THE MERGER

In connection with the Merger Agreement, the Principal
Stockholders will enter into employment agreements (the "Employment
Agreements") with Omnicare effective upon consummation of the Merger. The
Employment Agreements provide for the continued employment of the Principal
Stockholders in their current positions at Coromed for a period of five years,
subject to renewals thereafter for one-year periods, at initial annual salaries
of $185,709, $135,870, $141,486, and $125,045 for Dr. Dale B. Evans, Alice G.
Fedory, Thomas J. Massey and Dr. Ronald E. Weishaar, respectively. These
initial annual salaries are equal to the current annual salaries of these
executives. Dr. Evans' Employment Agreement also provides that Omnicare will
use reasonable best efforts to elect Dr. Evans to the Coromed Board for a one
year term. The Employment Agreements provide that the employee will be
entitled to such employee benefits as are given to other similarly situated
employees of Coromed. In addition, the Employment Agreements provide that if
the employee is terminated without cause, he or she will be entitled to receive
base compensation for the remainder of the Employment Agreement term.

Pursuant to the Employment Agreements, the employees have
agreed (i) during the term of employment and for five years thereafter, not to
disclose any confidential information of Coromed, (ii) for five years after
termination of employment, not to solicit customers or employees of Coromed and
(iii) during the term of employment and for five years thereafter, not to
develop, operate or participate in any business which competes with

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Coromed in North America, South America and Europe, subject to certain limited
exceptions.

In addition, pursuant to the Employment Agreements, the
Principal Stockholders will receive warrants to purchase 100,000 shares (in the
case of Dr. Evans) and 60,000 shares (in the case of each other Principal
Stockholder) of Omnicare Common Stock as a portion of his or her employment
compensation. The warrants are exercisable at any time up to and including the
third day following the date on which the holder ceases to be employed by
Coromed, unless such holder is terminated for "Cause" (as defined in the
Employment Agreements), in which case the warrants are exercisable at any time
up to and including the date of employment termination. The warrant exercise
price per share of Omnicare Common Stock is the Average Closing Price
calculated in accordance with the Merger Agreement.

The Principal Stockholders will also enter into
non-competition agreements with Coromed upon consummation of the Merger which
restrict the rights of such persons to engage in businesses competitive with
Coromed on terms substantially similar to the non-competition provisions of
the Employment Agreements, for a period of fifteen years from the Effective
Time.

The Principal Stockholders as a group beneficially owned, as
of the Record Date, 385,047 shares of Coromed Common Stock, representing
approximately 60% of the Coromed Common Stock entitled to vote on the Merger,
plus vested Coromed Options to acquire shares of Coromed Common Stock at
purchase prices ranging from $2.20 to $16.50 per share. Such Coromed Options
will be treated in the Merger in the same manner as Coromed Options held by
other holders. See "THE MERGER--Terms of the Merger."

Each Principal Stockholder has entered into the Support
Agreement pursuant to which such Principal Stockholder has agreed, among other
things, (i) to vote his or her Principal Stockholder Shares in favor of the
Merger and against any action that would interfere with the Merger, (ii) not to
sell any Principal Stockholder Shares or engage in discussions concerning any
such sale, and (iii) to grant to Omnicare the Principal Stockholder Option to
purchase the Principal Stockholder Shares in exchange for shares of Omnicare
Common Stock equal to the Exchange Ratio (calculated using the exercise date of
the Principal Stockholder Option as the deemed date of the Effective Time for
purposes of calculating the Average Closing Price). Each Principal Stockholder
would also have the right to payment in cash for the shares of Omnicare Common
Stock issuable under the Principal Stockholder Option having a value equal to
such Average Closing Price. The Principal Stockholder Option is exercisable
for a one-month period following (i) the termination of the Merger Agreement
under circumstances entitling Omnicare to the termination fee described below
under "THE MERGER-Termination Fees; Expenses of the Merger" or (ii) Coromed
having entered into

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<PAGE> 37
an agreement to engage in an Acquisition Transaction (as defined below). See
"THE MERGER--Support Agreement."

Pursuant to the Merger Agreement, all expenses incurred in
connection with the Merger Agreement will be paid by the party incurring such
expenses; provided, that if the Merger is consummated, the surviving
corporation in the Merger will pay the reasonable fees and expenses incurred by
Coromed and the Principal Stockholders in an amount up to $1,100,000 in the
aggregate. See "THE MERGER-Termination Fees; Expenses of the Merger."

Omnicare has agreed with the Principal Stockholders to use
reasonable best efforts to register under the Securities Act any shares of
Omnicare Common Stock received by the Principal Stockholders pursuant to the
Merger that have not otherwise been so registered, and to keep such
registration in effect until the earlier of two years from the Effective Time
and the date on which all such shares are sold.

Pursuant to the Merger Agreement, the Principal Stockholders
have agreed to indemnify Omnicare and its subsidiaries and their officers,
directors and employees from certain liabilities arising from the breach by
Coromed or the Principal Stockholders of their representations, warranties and
agreements in the Merger Agreement. See "THE MERGER--Survival of
Representations and Warranties; Indemnification."

SUPPORT AGREEMENT

As a condition to Omnicare's willingness to enter into the
Merger Agreement, Coromed and the Principal Stockholders have entered into a
Support Agreement, dated as of January 27, 1997, with Omnicare.

Pursuant to the Support Agreement, each Principal
Stockholder has granted to Omnicare the Principal Stockholder Option to
purchase, in whole but not in part, at the election of Omnicare, all of the
Principal Stockholder Shares in exchange for the number of shares of Omnicare
Common Stock equal to the number of the Principal Stockholder Shares to be
purchased by Omnicare multiplied by the Exchange Ratio (calculated using the
date the Stockholder Option is exercised as the deemed date of the Effective
Time for purposes of calculating the Average Closing Price) (the "Purchase
Price"). Each Stockholder may elect to cause Omnicare to pay all or a portion
of the Purchase Price in cash. If Omnicare decides to exercise the Stockholder
Option with respect to one Principal Stockholder, Omnicare must exercise the
Principal Stockholder Option with respect to all Stockholders.

The Stockholder Option may only be exercised by Omnicare
following the occurrence of a Purchase Event (as defined below); provided,
however, that the Stockholder Option terminates upon the earlier of (i) the
Effective Time, (ii) the termination

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<PAGE> 38
of the Merger Agreement in accordance with its terms (other than upon or during
the continuance of a Purchase Event) or (iii) one month following any
termination of the Merger Agreement upon or during the continuance of a
Purchase Event (or, if, at the expiration of such one month period the
Stockholder Option cannot be exercised by reason of any applicable, judgment,
decree or order, 20 business days after such impediment to exercise shall have
been removed or shall become final and not subject to appeal).

The term "Purchase Event" is defined in the Support
Agreement as (i) Coromed entering into an agreement to engage in an Acquisition
Transaction (as defined below) or (ii) the Merger Agreement being terminated by
Omnicare or Coromed under circumstances which would entitle Omnicare to a
termination fee under the Merger Agreement.

Pursuant to the Support Agreement, each Principal
Stockholder has also agreed that during the period from the signing of the
Support Agreement and continuing until the termination of the Principal
Stockholder Option ("Principal Stockholder Option Period"), he or she will vote
all of the Stockholder Shares which such Principal Stockholder is entitled to
vote as follows: (i) in favor of approval and adoption of the Merger Agreement;
and (ii) against any actions or agreement other than the Merger Agreement that
would impede, interfere with, delay, postpone or attempt to discourage the
Merger, including, without limitation: (a) any extraordinary corporate
transactions, such as a merger, acquisition, consolidation, reorganization,
share exchange, tender offer, exchange offer or similar transaction involving
Coromed or any of its Subsidiaries; or (b) a sale or transfer of a substantial
equity interest in or a substantial portion of the assets of Coromed or any of
its Subsidiaries (each an "Acquisition Transaction").

Each Principal Stockholder also has agreed that during the
Stockholder Option Period, such Principal Stockholder will not without the
prior written consent of Omnicare (i) sell, transfer, assign, pledge,
hypothecate, cause to be redeemed or otherwise dispose of any of the Principal
Stockholder Shares beneficially owned by him or her, (ii) grant any proxy or
interest in the Principal Stockholder Shares or deposit the Principal
Stockholder Shares into a voting trust or enter into a voting agreement or any
arrangement with respect to the Principal Stockholder Shares, or (iii) take any
action that would make any representation or warranty of the Principal
Stockholder regarding the ownership of his or her Principal Stockholder Shares
made in the Support Agreement untrue or incorrect or have the effect of
preventing or disabling the Principal Stockholder from performing his or her
obligations under the Support Agreement. In addition, each Principal
Stockholder has agreed during the Principal Stockholder Option Period not to
initiate, solicit or engage in any negotiations regarding an Acquisition
Transaction and has agreed collectively to remain the beneficial and record
owners of

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<PAGE> 39
a majority of the outstanding shares of Coromed Common Stock during the
Principal Stockholder Option Period.

EXCLUSIVITY

The Merger Agreement provides that prior to the Effective
Time, neither Coromed nor its Subsidiaries nor any of its officers, directors,
employees, agents or representatives will initiate, solicit or encourage any
inquiries or the making or implementation of any proposal or offer with respect
to an Alternative Proposal (as defined below) or engage in any negotiations
concerning, or provide any non-public information or data to, or have any
discussions with, any person relating to an Alternative Proposal, or otherwise
facilitate any effort or attempt to make or implement an Alternative Proposal;
provided, that the Coromed Board may furnish information or enter into
discussions or negotiations with any person related to an Alternative Proposal
if, and only to the extent, that the Coromed Board (i) determines in good faith
based upon the written opinion of outside counsel that such action is required
in order for the Coromed Board to comply with its fiduciary duties to its
stockholders, (ii) provides written notice to Omnicare of the identity of the
person inquiring and Coromed's intent to provide information to such person,
(iii) provides information to Omnicare on a timely basis as to the progress of
the inquiries and copies of any written inquiries and proposals thereto; and
(iv) in the event that Coromed decides to accept the Alternative Proposal,
Coromed provides Omnicare with at least five business days' prior written
notice thereof, during which time Omnicare may make a counteroffer and Coromed
will in good faith consider such counteroffer. The term "Alternative Proposal"
as defined in the Merger Agreement means any merger, acquisition,
consolidation, reorganization, share exchange, tender offer, exchange offer or
similar transaction involving Coromed or any of its Subsidiaries, or any
proposal or offer to acquire in any manner, directly or indirectly, a
substantial equity interest in or a substantial portion of the assets of
Coromed or any Subsidiary thereof.

RESALES OF OMNICARE COMMON STOCK

All shares of Omnicare Common Stock received by Coromed
stockholders in the Merger will be freely transferable pursuant to the
Securities Act, except that shares of Omnicare Common Stock received by persons
who are deemed to be "affiliates" (as such term is defined under the Securities
Act) of Coromed prior to the Merger may be resold by them only in transactions
permitted by the resale provisions of Rule 145 promulgated under the Securities
Act or as otherwise permitted under the Securities Act. Persons who may be
deemed to be affiliates of Omnicare or Coromed generally include individuals or
entities that control, are controlled by, or are under common control with,
such party and may include certain officers and directors of such party as well
as principal stockholders of such party. The Merger Agreement requires Coromed
to cause each of

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<PAGE> 40
its affiliates to execute a written agreement (the "Affiliate Letter") to the
effect that, among other things, such person will not offer to sell, sell or
otherwise dispose of Omnicare Common Stock except (i) pursuant to an effective
registration statement, (ii) pursuant to the provisions of Rule 145 under the
Securities Act or (iii) pursuant to another exemption from registration under
the Securities Act, which in the opinion of counsel reasonably acceptable in
form and substance to Omnicare is available. Coromed has identified the
Principal Stockholders as the current affiliates of Coromed.

The Affiliate Letters provide that such affiliate not
dispose of any shares of Omnicare Common Stock (excluding an amount up to 10%
of Omnicare Common Stock received as a result of the Merger) until the
financial results of at least 30 days of post-Merger combined operations of
Coromed and Omnicare have been made publicly available. In addition, in order
for the Merger to be treated as a "pooling of interests" under applicable
United States accounting standards, during such period, aggregate sales by all
affiliates may not exceed 1% of all shares of Omnicare Common Stock received by
Coromed stockholders in the Merger.

CONDITIONS TO THE MERGER

Pursuant to the Merger Agreement, the respective obligations
of Omnicare, Merger Sub, Coromed and the Principal Stockholders to effect the
Merger are subject to the fulfillment at or prior to the Closing Date of the
following conditions, among others: i) the Merger Agreement having been
approved by the Coromed stockholders, ii) no order or injunction being in
effect which prohibits the consummation of the transactions contemplated by the
Merger Agreement, iii) all consents and approvals of governmental bodies
required in connection with the Merger Agreement having been obtained, iv)
approval of the Omnicare Common Stock to be issued to Coromed stockholders in
connection with the Merger for listing on the NYSE, and v) Coromed having
received opinions of Morgan, Lewis & Bockius LLP, special counsel to Coromed,
on the date of the Proxy Statement/Prospectus and on the Closing Date, stating
that the Merger will be treated for federal income tax purposes as a
reorganization within the meaning of Section 368(a) of the Code, and that
Coromed, Omnicare and Merger Sub will each be a party to that reorganization
within the meaning of Section 368(b) of the Code.

The obligations of Coromed and the Principal Stockholders to
effect the Merger are subject to the fulfillment at or prior to the Closing
Date of the following conditions, among others: (a) Omnicare having performed
in all material respects its agreements contained in the Merger Agreement and
the representations and warranties of Omnicare and Merger Sub in the Merger
Agreement being true and correct as of the Closing Date, if the failure of any
of the representations or warranties to be so true and correct would be
reasonably likely to have a material adverse effect on Omnicare, (b) Coromed
having received from

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<PAGE> 41
Coopers & Lybrand L.L.P. a letter stating their concurrence with the conclusion
of Coromed's management that no conditions exist with respect to Coromed that
would preclude the Merger from being treated as a "pooling of interests" under
applicable United States accounting standards, and (c) Omnicare having entered
into an Employment Agreement with each Principal Stockholder.

The obligations of Omnicare and Merger Sub to effect the
Merger is subject to the fulfillment at or prior to the Closing Date of the
following conditions, among others: (a) Coromed having performed in all
material respects its agreements contained in the Merger Agreement and the
representations and warranties of Coromed in the Merger Agreement being true
and correct as of the Closing Date, if the failure of any of the
representations or warranties to be so true and correct would be reasonably
likely to have a material adverse effect on Coromed, (b) Omnicare having
received from Price Waterhouse LLP an opinion that the Merger will be treated
as a "pooling of interests" under applicable accounting standards, (c) from
November 30, 1996 through the Effective Time, there having not occurred any
change in the business, earnings, assets, liabilities, financial or other
condition or results of operations of Coromed and its Subsidiaries, taken as a
whole, that could have a material adverse effect on Coromed, (d) each of the
Principal Stockholders having entered into an Employment Agreement and a Non-
Competition Agreement with Omnicare, and (e) no more than 5% of the outstanding
shares of Coromed Common Stock being Dissenting Shares pursuant to Section 262
of the DGCL.

TERMINATION OF THE MERGER AGREEMENT

The Merger may be abandoned at any time prior to the
Effective Time as follows:

(a) By mutual consent of Omnicare and Coromed.

(b) By either the Omnicare Board or Coromed Board, if,
(i) the Merger shall not have been consummated by September 30, 1997,
(ii) the approval of Coromed stockholders is not obtained, or (iii)
upon the existence of an order, decree or ruling by a court or
governmental, regulatory or administrative agency or commission
prohibiting the Merger.

(c) By the Coromed Board (i) if upon exercise of its good
faith judgment as to fiduciary duties to its stockholders based on the
written opinion of outside counsel, the Coromed Board determines that
termination is required due to the existence of an Alternative
Proposal; provided, that Coromed must give Omnicare at least five
business days' prior notice of its intention to recommend such
Alternative Proposal, (ii) if there has been a breach by Omnicare or
Merger Sub of any representation or warranty in the Merger Agreement
that would be reasonably likely to have a material adverse effect on
Omnicare or the Merger, or (iii) if there has been a material breach
by Omnicare of any

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covenant or agreement in the Merger Agreement that is non-curable or,
if curable, is not cured within 30 days after written notice of such
breach.

(d) By the Omnicare Board (i) if Coromed modifies or
withdraws in a manner materially adverse to Omnicare its approval or
recommendation of the Merger or recommends an Alternative Proposal to
its stockholders, (ii) if there has been a breach by Coromed of any
representation or warranty in the Merger Agreement that would be
reasonably likely to have a material adverse effect on Coromed or the
Merger, or (iii) if there has been a material breach by Coromed of any
covenant or agreement in the Merger Agreement that is non-curable or,
if curable, is not cured within 30 days after written notice of such
breach.

TERMINATION FEES; EXPENSES OF THE MERGER

If any person or entity makes an Alternative Proposal more
favorable to Coromed stockholders than the Merger and thereafter the Merger
Agreement is terminated pursuant to clauses (b)(ii), (c)(i) or (d) under the
heading "THE MERGER--Termination of the Merger Agreement" above, then, Coromed
will on the day of such termination, pay Omnicare a fee of $2,000,000 which
amount will be payable by wire transfer of same day funds.

All costs and expenses incurred in connection with the
Merger Agreement and the transactions contemplated thereby shall be paid by the
party incurring such expenses; provided, however, that if the Merger is
consummated, Coromed, the surviving corporation in the Merger, shall pay the
reasonable fees and expenses incurred by Coromed and the Principal Stockholders
in connection with the transactions contemplated by the Merger Agreement in an
amount not to exceed $1,100,000 in the aggregate.

REPRESENTATIONS AND WARRANTIES

The Merger Agreement contains representations and warranties
of Coromed regarding, among other things, Coromed's organization,
capitalization, authority to enter into the Merger Agreement, compliance with
laws, litigation and liabilities, absence of changes since November 30, 1996,
tax matters, employee benefit matters and environmental matters. In addition,
the Merger Agreement contains representations and warranties of the Principal
Stockholders regarding, among other things, his or her ownership of shares of
Coromed Common Stock and authority to enter into the Merger Agreement.

The Merger Agreement contains representations and warranties
of Omnicare and Merger Sub regarding, among other things, its capitalization,
authority and the lack of material misstatements or omissions in certain
Omnicare filings with the Commission.

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SURVIVAL OF REPRESENTATIONS AND WARRANTIES; INDEMNIFICATION

The representations and warranties made by each of the
parties in the Merger Agreement will survive the Effective Time for a period
ending at the earlier of (i) one year from the Effective Time or (ii) the date
upon which the first Annual Report on Form 10-K reflecting the combined
operations of Omnicare and Coromed is filed with the Commission.

Pursuant to the Merger Agreement, the Principal Stockholders
will jointly and severally indemnify Omnicare and its subsidiaries and their
officers, directors and employees from and against any liabilities and expenses
arising out of or resulting from any breach of Coromed's representations and
warranties in the Merger Agreement and any material breach by Coromed or the
Principal Stockholders of the covenants and agreements in the Merger Agreement;
provided, that (i) the Principal Stockholders will not be liable for breaches
of certain environmental representations and warranties relating solely to the
activities of third parties unless and until all Omnicare losses (of any
nature) on a cumulative basis exceed $350,000, in which case the Principal
Stockholders will be liable only for losses in excess of $350,000, and (ii) the
Principal Stockholders will not be liable for any other breach by Coromed of
its representations and warranties unless and until all Omnicare losses (of any
nature) on a cumulative basis exceed $200,000, in which case the Principal
Stockholders will be liable only for losses in excess of $200,000. In
addition, each Principal Stockholder will severally and not jointly indemnify
Omnicare and its subsidiaries and their officers, directors and employees from
and against any liabilities and expenses arising out of or resulting from any
breach of such Principal Stockholder's representations and warranties in the
Merger Agreement; provided, that such Principal Stockholder will not be liable
for any such breach unless and until all Omnicare losses arising therefrom
exceed $50,000, in which case such Principal Stockholder will be liable only
for losses in excess of $50,000. Notwithstanding the foregoing, the Principal
Stockholders' aggregate liability pursuant to this paragraph (over and above
any threshold amounts described above) will not exceed $2,000,000.

GOVERNMENTAL AND REGULATORY APPROVALS

Omnicare and Coromed do not believe that any governmental
filings in the United States are required with respect to the Merger, other
than the filing of the Certificate of Merger required to be filed with the
Secretary of State of the State of Delaware in accordance with the DGCL and the
filing of the registration statement of which this Proxy Statement/Prospectus
is a part with the Commission.

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APPRAISAL RIGHTS

If the Merger is consummated, dissenting holders of Coromed
Common Stock who follow the procedures specified in Section 262 of the DGCL are
entitled to have their shares of Coromed Common Stock appraised by the Delaware
Court of Chancery (the "Court") and to receive the "fair value" of such shares
("Dissenting Shares") in cash, as determined by the Court, in lieu of the
consideration that such stockholder would otherwise be entitled to receive
pursuant to the Merger Agreement.

The following is a brief summary of Section 262, which sets
forth the procedures for dissenting from the Merger and demanding statutory
appraisal rights, if such rights are available. This summary does not purport
to be a complete statement of the provisions of the DGCL relating to the rights
of Coromed stockholders to an appraisal of the value of their shares and is
qualified in its entirety by reference to Section 262, the full text of which
is attached as Appendix C hereto. Failure to follow these procedures exactly
could result in the loss of appraisal rights. This Proxy Statement/Prospectus
constitutes notice to holders of Coromed Common Stock concerning the
availability of appraisal rights under Section 262. Under Section 262, a
stockholder of record wishing to assert appraisal rights must hold his or her
Coromed Common Stock on the date of making a demand for appraisal rights with
respect to such stock and must continuously hold such stock through the
Effective Time of the Merger.

STOCKHOLDERS WHO DESIRE TO EXERCISE THEIR APPRAISAL RIGHTS
MUST SATISFY ALL OF THE CONDITIONS OF SECTION 262. A WRITTEN DEMAND FOR
APPRAISAL OF SHARES MUST BE FILED WITH COROMED BEFORE THE TAKING OF THE VOTE ON
THE MERGER. THIS WRITTEN DEMAND FOR APPRAISAL OF SHARES MUST BE IN ADDITION TO
AND SEPARATE FROM ANY PROXY VOTE ABSTAINING FROM OR VOTING AGAINST THE MERGER.
ANY SUCH ABSTENTION OR VOTE AGAINST THE MERGER WILL NOT CONSTITUTE A DEMAND FOR
APPRAISAL WITHIN THE MEANING OF SECTION 262.

STOCKHOLDERS ELECTING TO EXERCISE THEIR APPRAISAL RIGHTS
UNDER SECTION 262 MUST NOT VOTE FOR APPROVAL OF THE MERGER. IF A STOCKHOLDER
RETURNS A SIGNED PROXY BUT DOES NOT SPECIFY A VOTE AGAINST APPROVAL OF THE
MERGER OR A DIRECTION TO ABSTAIN, THE PROXY WILL BE VOTED FOR APPROVAL OF THE
MERGER, WHICH WILL HAVE THE EFFECT OF WAIVING THAT STOCKHOLDER'S APPRAISAL
RIGHTS.

A demand for appraisal must be executed by or for the
stockholder of record, fully and correctly, as such stockholder's name appears
on the certificates representing shares of Coromed Common Stock. If the stock
is owned of record in a fiduciary capacity, such as by a trustee, guardian or
custodian, such demand must be executed by or for the fiduciary. If the stock
is owned of record by or for more than one person, as in a joint tenancy or
tenancy in common, such demand must be executed by or for all joint owners. An
authorized agent, including an agent

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for two or more joint owners, may execute the demand for appraisal for a
stockholder of record; however, the agent must identify the record owner and
expressly disclose that, in exercising the demand, he is acting as agent for
the record owner. A person having a beneficial interest in Coromed Common
Stock held of record in the name of another person, such as a broker or
nominee, must act promptly to cause the record holder to follow the steps
summarized below and in a timely manner to perfect whatever appraisal rights
the beneficial owners may have.

A record owner, such as a broker, who holds stock as a
nominee for others, may exercise appraisal rights with respect to the stock
held for all or less than all beneficial owners of stock as to which the holder
is the record owner. In such case the written demand must set forth the number
of stock covered by such demand. Where the number of stock is not expressly
stated, the demand will be presumed to cover all stock outstanding in the name
of such record owner.

A Coromed stockholder who elects to exercise appraisal
rights will be required to mail or deliver his or her written demand to:
Coromed, Inc., Rensselaer Technology Park, 185 Jordan Road, Troy, New York
12180-7615, Attention: Secretary. The written demand for appraisal should
specify the stockholder's name and mailing address, the number of shares owned,
and that the stockholder is thereby demanding appraisal of his or her stock.
Within ten days after the Effective Time of the Merger, Coromed must provide
notice of the Effective Time of the Merger to all of its stockholders who have
complied with Section 262 and have not voted for approval of the Merger.

Within 120 days after the Effective Time of the Merger, any
stockholder who has satisfied the requirements of Section 262 will be entitled,
upon written request, to receive from Coromed a statement setting forth the
aggregate number of shares not voted in favor of the Merger and with respect to
which demands for appraisal have been received and the aggregate number of
holders of such shares.

Within 120 days after the Effective Time of the Merger (but
not thereafter), either Coromed or any stockholder who has complied with the
required conditions of Section 262 may file a petition in the Delaware Court of
Chancery demanding a determination of the fair value of the Dissenting Shares.

Upon the filing of any petition by a stockholder in
accordance with Section 262, service of a copy must be made upon Coromed, which
must, within 20 days after service, file in the office of the Register of
Chancery in which the petition was filed, a duly verified list containing the
names and addresses of all stockholders who have demanded payment for their
shares and with whom agreements as to the value of their shares have not been
reached by Coromed. If a petition is filed by Coromed, the petition must be
accompanied by the verified list. The Register of Chancery, if so ordered by
the Court, will give notice of the

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<PAGE> 46
time and place fixed for the hearing of such petition by registered or
certified mail to Coromed and to the stockholders shown on the list at the
addresses therein stated, and notice will also be given by publishing a notice
at least one week before the day of the hearing in a newspaper of general
circulation published in the City of Wilmington, Delaware, or such publication
as the Court deems advisable. The forms of notices by mail and by publication
must be approved by the Court, and the costs thereof shall be borne by Coromed.

If a petition for an appraisal is timely filed, after a
hearing on such petition, the Court will determine which stockholders are
entitled to appraisal rights and thereafter will appraise the stock owned by
such stockholders, determining the fair value of such stock, exclusive of any
element of value arising from the accomplishment or expectation of the Merger,
together with a fair rate of interest to be paid, if any, upon the amount
determined to be the fair value. In determining fair value, the Court is to
take into account all relevant factors.

Coromed stockholders considering seeking appraisal should
bear in mind that the fair value of their stock determined under Section 262
could be more than, the same as, or less than the applicable consideration they
are entitled to receive pursuant to the Merger Agreement if they do not seek
appraisal of their stock. The cost of the appraisal proceeding may be
determined by the Court and taxed upon the parties as the Court deems equitable
in the circumstances. Upon application of a stockholder seeking appraisal
rights, the Court may order that all or a portion of the expenses incurred by
such stockholder in connection with the appraisal proceeding, including,
without limitation, reasonable attorneys' fees and the fees and expenses of
experts, be charged pro rata against the value of all stock entitled to
appraisal. In the absence of such a determination or assessment, each party
bears its own expenses.

Any stockholder who has duly demanded an appraisal in
compliance with Section 262 will not, after the Effective Time of the Merger,
be entitled to vote the shares subject to such demand for any purpose or be
entitled to the payment of dividends or other distributions on those shares
(except dividends or other distributions payable to stockholders of record at a
date prior to the Effective Time of the Merger).

At any time within 60-days after the Effective Time of the
Merger, any stockholder shall have the right to withdraw his or her demand for
appraisal and to accept the terms offered in the Merger Agreement. After this
period, a stockholder may withdraw his or her demand for appraisal only with
the consent of Coromed. If no petition for appraisal is filed with the Court
within 120 days after the Effective Time of the Merger, stockholders' rights to
appraisal (if available) shall cease and all stockholders shall be entitled to
receive the consideration as provided for in the Merger Agreement. Inasmuch as
Coromed has no obligation to file such a petition, and has no present

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intention to do so, any stockholder who desires such a petition to be filed is
advised to file it on a timely basis. However, no petition timely filed in the
Court demanding appraisal shall be dismissed as to any stockholder without the
approval of the Court, and such approval may be conditioned upon such terms as
the Court deems just.

Pursuant to the Merger Agreement, the obligations of
Omnicare and Merger Sub to effect the Merger are conditioned upon, among other
things, holders of no more than 5% of the outstanding shares of Coromed Common
Stock having taken the actions required to exercise appraisal rights pursuant
to Section 262 of the DGCL. See "THE MERGER--Conditions to the Merger."

ACCOUNTING TREATMENT OF THE MERGER

Omnicare and Coromed believe that the Merger will qualify as
a "pooling of interests" for accounting and financial reporting purposes, and
have been so advised by their respective independent public accountants.
Coromed's historical financial condition and results of operations are not
material to Omnicare's historical consolidated financial statements.
Accordingly, (i) Coromed's results of operations will be included in the
consolidated financial statements of Omnicare from the date of consummation of
the Merger and (ii) pro forma financial statements are not included herein.

The obligations of Coromed to consummate the Merger are
conditioned upon receipt by Coromed of a letter from Coopers & Lybrand L.L.P.
which states their concurrence with the conclusion of Coromed's management that
no conditions exist with respect to Coromed that would preclude the Merger from
being treated as a "pooling of interests" under applicable United States
accounting standards, and the obligations of Omnicare and Merger Sub to
consummate the Merger are conditioned upon receipt by Omnicare of an opinion
from Price Waterhouse LLP, to the effect that the Merger will be accounted for
as a "pooling of interests" for the purposes of generally accepted accounting
principles and applicable accounting rules of the Commission.

COMPARISON OF STOCKHOLDER RIGHTS

Omnicare and Coromed are each incorporated under the laws of
the State of Delaware. Holders of shares of Coromed Common Stock, whose rights
as stockholders are currently governed by the DGCL, the Certificate of
Incorporation of Coromed ("Coromed Certificate") and the Bylaws of Coromed, as
amended ("Coromed Bylaws"), will, upon the exchange of their shares pursuant to
the Merger, become holders of shares of Omnicare Common Stock, and their rights
as such will be governed by the DGCL, the Restated Certificate of Incorporation
of Omnicare ("Omnicare Certificate"), and the Amended Bylaws of Omnicare
("Omnicare Bylaws"). The material differences between the rights of holders of
shares of Coromed Common Stock and of the rights of holders of shares of
Omnicare Common Stock result from

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differences in their governing corporate documents and are summarized below.
This summary is qualified in its entirety by reference to the full text of the
respective Certificates of Incorporation and Bylaws of Omnicare and Coromed.

Authorized Capital

The Omnicare Certificate provides that Omnicare has
authority to issue 110,000,000 Omnicare Common Stock, par value $1.00 per
share, of which approximately 77,123,601 were outstanding as of January 31,
1997, and 1,000,000 shares of Preferred Stock, without par value, of which no
shares are currently outstanding. The Coromed Certificate provides that
Coromed has authority to issue 2,000,000 Coromed Common Stock, par value $.01
per share, of which ____ were outstanding as of the Record Date.

Board Approved Preferred Stock

The Omnicare Certificate allows the Omnicare Board to issue
one or more series of Preferred Stock and to designate the number of shares to
be included in such series; the dividend rate; the redemption price or prices
if any; the terms and conditions of the redemption of or purchase of the shares
of such series; the terms and conditions on which such shares are convertible
into common stock or any other securities, if they are convertible; and any and
all other designations, preferences and relative participating, option, voting
or other special rights and qualifications, limitations or restrictions
thereof, of such series. Pursuant to the Coromed Certificate, Coromed has no
shares of preferred stock authorized for issuance.

Although it has no present intention to do so, the Omnicare
Board has the ability to issue one or more series of Omnicare Preferred Stock
that could, depending on the terms of such series, impede the completion of a
merger, tender offer or other takeover attempt. The Omnicare Board will make
any determination to issue such shares based on its judgment as to the best
interests of Omnicare and its stockholders.

Directors

Number. The Omnicare Bylaws provide for no fewer than three
and no more than thirty directors with the number of directors to be determined
by board resolution, or in the absence thereof, the number of directors shall
be the number of directors elected at the preceding annual meeting of
stockholders. Currently, the Omnicare Board has fixed the number of directors
at sixteen.

The Coromed Bylaws has fixed the number of directors at
four.

Election of Directors. The Omnicare Bylaws provide for the
election of directors at the annual meeting of

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stockholders or in the event of a vacancy, by the directors (see "Vacancy"
below). Directors are elected by a plurality of the votes cast. No person may
be nominated for election as a director unless written notice of intention to
nominate such person shall have been given to the Chairman, the President or
the Secretary of Omnicare by a stockholder entitled to notice of and to attend
a meeting of stockholders at which directors are to be elected no later than 15
business days before the date of such meeting.

The Coromed Bylaws provide for the election of directors at
the annual meeting by the stockholders.

Removal. The Omnicare Certificate provides that the
directors may be removed without cause only by two-thirds of the shares then
entitled to vote at an election of directors.

The Coromed Bylaws provide for the entire board or any
individual director to be removed from office without cause by a majority vote
of the holders of the outstanding shares entitled to vote.

Vacancies. The Omnicare Bylaws state that vacancies in the
Omnicare Board, whether caused by resignation, removal, death or any other
reason, and newly created directorships resulting from any increase in the
authorized number of directors, may be filled either by majority vote of the
directors then remaining in office (whether or not sufficient in number to
constitute a quorum), or by a sole remaining director, or by a plurality of the
votes cast at the meeting of stockholders held for that purpose. In addition,
the Omnicare Bylaws state that in the event that one or more directors shall
resign from the Omnicare Board, effective at a future date, a majority of the
directors then in office, including those who have so resigned effective at a
future date, shall have power to fill the vacancy or vacancies which will
result when such resignation(s) become effective, the vote thereon to take
effect when such resignation(s) become effective.

The Coromed Bylaws state that any vacancies and newly
created directorships resulting from any increase in the authorized number of
directors elected by all of the stockholders having the right to vote as a
single class may be filled by a majority of the directors then in office,
although less than a quorum, or by a sole remaining director, and that each
person so elected as director will remain as director until his successor is
elected and qualified or until his earlier resignation and removal.

Stockholders' Meetings

Special Meeting of Stockholders. The Omnicare Bylaws state
that special stockholders' meetings may be called at any time by the Chairman,
the President or the Secretary and must be called by the aforementioned upon
the written request of the

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majority of the Omnicare Board or of the holders of record of a majority of the
stock then entitled to vote for the election of directors.

The Coromed Bylaws state that special stockholders' meetings
may be called by the Coromed Board, by the President or by the holders of
record of not less than a majority of the shares outstanding and entitled to
vote.

Stockholder Action by Written Consent. The Omnicare Bylaws
allow any action required or permitted to be taken at a meeting of stockholders
to be taken without a meeting, without prior notice and without a vote, if
consents in writing, setting forth the action so taken, are signed by the
holders of record of shares having not less than the minimum voting power that
would have been necessary to take such action at a meeting at which all common
stock entitled to vote thereon were present and voted.

The Coromed Bylaws allow for stockholder action by written
consent on substantially the same terms as the Omnicare ByLaws.

Quorum. The Omnicare Bylaws provide that a quorum at any
meeting is constituted when holders of record of shares having a majority of
the voting power of the stock entitled to vote at any such meeting are present.

Pursuant to the Coromed Bylaws, the presence of holders of a
majority of the outstanding shares entitled to vote constitutes a quorum. The
stockholders present at a duly organized meeting may continue to do business
until adjournment, notwithstanding the withdrawal of enough stockholders to
leave less than a quorum. In the case of any meeting for the election of
directors, those stockholders who attend the second of such adjourned meetings,
although less than a quorum, will, nonetheless, constitute a quorum for the
purpose of electing directors.

Notice and Waiver of Notice of Meetings. The Omnicare
Bylaws require, unless otherwise provided by law, that notice of an annual or
special stockholders' meeting (specifying the time, place and purpose thereof)
be given not less than 10 nor more than 50 days before the meeting date and
does not, unless otherwise provided by law, require notice of any adjourned
meeting of stockholders.

The Coromed Bylaws follow the DGCL in requiring that notice
of an annual or special stockholders' meeting be given not less than 10 nor
more than 60 days before the day of the meeting and requiring that a notice of
adjournment be given if the adjournment is for more than 30 days or a new
record date is fixed for the adjourned meeting. The notice is to specify the
place, day and hour of the meeting and, in the case of a special meeting or
where otherwise required by law, the general nature of the business to be
transacted at such meeting.

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Business Combinations.

Pursuant to the Omnicare Certificate, a merger or
consolidation of Omnicare with, a disposition of a substantial part of
Omnicare's assets to or with, the transfer of Omnicare securities in exchange
for assets or securities with a fair market value of $5 million or more to, or
the transfer of Omnicare securities for cash to, a person or entity
beneficially owning 10% or more of the outstanding shares of Omnicare capital
stock entitled to vote in the election of directors, requires the approval of
the holders of a majority of the outstanding shares of Omnicare capital stock
not beneficially owned by such person or entity. No such approval is required
for a transaction: (i) with another corporation of which Omnicare is the
majority stockholder, (ii) with another person or entity, if the Omnicare Board
approved a memorandum of understanding with such person or entity before such
person or entity became a 10% stockholder of Omnicare, or (iii) approved
unanimously by the Omnicare Board prior to the consummation thereof.

The Coromed Certificate contains no similar provision.

Amendment of Certificate of Incorporation.

The Omnicare Certificate provides that the provisions of the
Omnicare Certificate may be amended or repealed in the manner provided by law,
except that the approval of two-thirds of each class entitled to vote thereon
is required to amend or repeal the provisions of the Omnicare Certificate
relating to (i) the power of the Omnicare Board to amend or repeal the Omnicare
Bylaws, (ii) business combinations with interested stockholders described in
"Business Combinations" above, (iii) removal of directors without cause, (iv)
directors' liability; and (v) indemnification of directors, officers and
employees.

The Coromed Certificate may be amended, altered or repealed
in any manner provided by law.

Amendment of Bylaws.

The Omnicare Certificate permits the Omnicare Board to make,
alter or repeal the Omnicare Bylaws. The Omnicare Bylaws permit the bylaws to
be altered, amended or repealed and new bylaws to be made and adopted by action
of a majority of the whole Omnicare Board or by the stockholders.

The Coromed Certificate allows the Coromed Board to make,
alter or repeal the Coromed Bylaws. The Coromed Bylaws also provide for the
stockholders to adopt, amend or repeal the Coromed Bylaws.

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Limitation on Directors' Liability.

The Omnicare Certificate provides that a director will not
be liable to Omnicare or its stockholders for monetary damages for breach of
fiduciary duty as a director to the full extent permitted by the DGCL.

Similarly, the Coromed Certificate provides that a director
shall not be personally liable to the corporation or its stockholders for
monetary damages for breach of fiduciary duty as a director to the full extent
permitted by the DGCL.

Indemnification of Directors.

The Omnicare Certificate provides for indemnification of
directors, officers, employees and agents to the full extent permitted by the
DGCL.

Similarly, the Coromed Bylaws provide for the
indemnification of any director, officer, employee or agent to the full extent
permitted by the DGCL.

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CERTAIN FEDERAL INCOME TAX CONSEQUENCES OF THE MERGER

The following general discussion summarizes the material
federal income tax consequences of the Merger to certain holders of Coromed
Common Stock and is based upon the Code, the applicable Treasury Department
regulations thereunder, judicial authority and current administrative rulings
and practice, all as in effect as of the date hereof. Future legislation,
regulations, administrative rulings or court decisions could significantly
change such authorities either prospectively or retroactively. The following
discussion does not address the consequences of the Merger under state, local
or foreign law nor does the discussion address all aspects of federal income
taxation that may be important to a stockholder in light of such stockholder's
particular circumstances or to stockholders subject to special rules,
including, without limitation, financial institutions, insurance companies,
foreign individuals and entities, tax-exempt entities, dealers in securities,
persons who acquired Coromed Common Stock pursuant to the exercise of an
employee option (or otherwise as compensation) or persons holding Coromed
Common Stock as part of an integrated investment (including a "straddle")
comprised of shares of Coromed Common Stock and one or more other positions.
This discussion assumes that Coromed stockholders hold their respective shares
of Coromed Common Stock as capital assets within the meaning of section 1221 of
the Code.

It is a condition to the obligations of each party to
consummate the Merger that Coromed receive opinions from Morgan, Lewis &
Bockius, dated as of (i) the date of this Proxy Statement/Prospectus and (ii)
the Closing Date, that, on the bases of facts, representations and assumptions
set forth in such opinions, the Merger will qualify for federal income tax
purposes as a reorganization within the meaning of section 368(a) of the Code,
and that Coromed, Omnicare and Merger Sub will each be a party to that
reorganization within the meaning of section 368(b) of the Code.

THE FOLLOWING SUMMARY OF CERTAIN MATERIAL FEDERAL INCOME TAX
CONSEQUENCES OF THE MERGER IS WITHOUT REFERENCE TO THE FACTS AND CIRCUMSTANCES
OF ANY PARTICULAR STOCKHOLDER. THIS DISCUSSION DOES NOT ADDRESS ANY NON-INCOME
TAX OR ANY FOREIGN, STATE OR LOCAL TAX CONSEQUENCES OF THE MERGER. MOREOVER,
THIS DISCUSSION DOES NOT ADDRESS THE TAX CONSEQUENCES OF ANY TRANSACTION OTHER
THAN THE MERGER. ACCORDINGLY, EACH STOCKHOLDER IS STRONGLY URGED TO CONSULT
WITH SUCH STOCKHOLDER'S TAX ADVISOR TO DETERMINE THE PARTICULAR UNITED STATES
FEDERAL, STATE, LOCAL OR FOREIGN INCOME OR OTHER TAX CONSEQUENCES OF THE MERGER
TO SUCH STOCKHOLDER.

Exchange of Coromed Common Stock Solely for Omnicare Common
Stock. Except as discussed below under "Cash Received in Lieu of Fractional
Shares", no gain or loss will be recognized for federal income tax purposes by
holders of Coromed Common

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Stock who exchange their Coromed Common Stock for Omnicare Common Stock
pursuant to the Merger. The aggregate tax basis of Omnicare Common Stock
received as a result of the Merger will be the same as the stockholder's
aggregate tax basis in the Coromed Common Stock surrendered in the exchange
(reduced by any tax basis allocable to fractional shares exchanged for cash)
and the holding period of the Omnicare Common Stock received will include the
holding period of the Coromed Common Stock surrendered therefor.

Cash Received in Lieu of Fractional Shares. No fractional
shares of Omnicare Common Stock will be issued in the Merger. Cash received by
a Coromed stockholder in the Merger in lieu of a fractional share of Omnicare
Common Stock will result in the recognition of capital gain or loss for federal
income tax purposes, measured by the difference between the amount of cash
received and the portion of the tax basis of the share of Coromed Common Stock
allocable to such fractional share interest. Such capital gain or loss will be
long-term capital gain or loss if such share of Coromed Common Stock has been
held for more than one year at the Effective Time.

Expenses of the Merger. Any Coromed stockholder whose
expenses relating to the Merger are paid on his or her behalf by Coromed will
be deemed to receive from Coromed ordinary income equal to the amount of such
expenses.

Dissenters. The tax consequences to a Coromed stockholder
who exercises dissenters' rights with respect to a share of Coromed Common
Stock and receives payment for such share in cash will generally not depend on
the qualification of the Merger as a reorganization for federal income tax
purposes. Such stockholder will generally recognize capital gain or loss for
federal income tax purposes, measured by the difference between the holder's
basis in such share and the amount of cash received. Such capital gain or loss
will be long-term capital gain or loss if such share has been held for more
than one year at the Effective Time.

Backup Withholding. Unless an exemption applies under the
applicable law and regulations, the Exchange Agent is required to withhold, and
will withhold, 31% of any cash payments to a stockholder in the Merger unless
the stockholder provides the appropriate form as described below. Each Coromed
stockholder should complete and sign the Substitute Form W-9 included as part
of the letter of transmittal to be sent to each Coromed stockholder, so as to
provide the information (including the stockholder's taxpayer identification
number) and certification necessary to avoid backup withholding, unless an
applicable exemption exists and is proved in a manner satisfactory to Omnicare
and the Exchange Agent.

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BUSINESS OF COROMED

Coromed, founded in 1989 and headquartered in Albany, New
York, is an international CRO, providing preclinical research and clinical
development services worldwide to the pharmaceutical, biotechnology and, to a
lesser extent, medical device industries. Coromed complements the research and
development departments of pharmaceutical and biotechnology companies by
offering preclinical and clinical services to its clients and reducing their
drug development time and cost. In addition, Coromed's integrated services and
information technology capabilities, coupled with its broad experience and
expertise in global drug development, provide clients with a variable cost
alternative to the fixed costs associated with internal drug development.
Coromed offers a full range of preclinical research and clinical development
services, including chemical synthesis, preclinical safety and efficacy
studies, designing, initiating and monitoring clinical trials, managing and
analyzing clinical data, medical writing, quality assurance services and
consulting on regulatory affairs.

Coromed has built its business through strategic internal
expansion. In 1993, Coromed established a satellite office in San Diego,
California, to provide more effectively clinical trials monitoring and
management services in the west coast region. Coromed also initiated its
international expansion in 1993, with the incorporation in Quebec, Canada of
Coromed Canada, a wholly-owned subsidiary that provides comprehensive clinical
development services throughout Canada. The expansion of Coromed's
international capabilities and operations continued with the incorporation of
Coromed S.A. in Buenos Aires, Argentina in 1995. Coromed also opened an office
in Ghent, Belgium in 1995 as a step toward establishing a presence in Europe.

In January 1997, Coromed signed a joint venture agreement
with a leading group of cardiologists in the New England area. The joint
venture provides Coromed access to a network of clinical cardiology
investigative sites for clinical trials. The joint venture represents
Coromed's initial entry into site management. Initially, the network will
consist of approximately 25 sites.

The size of contracts awarded to Coromed has increased over
time as a result of Coromed's ability to provide a full range of services to
its clients. This is exemplified by the commencement in October of 1996 of a
clinical trials management project which is expected to generate approximately
$2.5 million of revenue in the current fiscal year. Coromed seeks to secure
even larger contracts as a result of its continued development of capabilities
in key areas of clinical trials management and data management. There can be
no assurance that Coromed will be able to secure such contracts and even if
such contracts are secured that they will be profitable.

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In November of 1996, Coromed executed a letter of intent
with a European contract research organization. The proposed operating
alliance will enable Coromed to utilize the infrastructure of this European
organization in Coromed's international trials. The alliance will also enable
Coromed to provide pharmacoeconomic and quality of life studies to its clients.
No assurance can be given that the proposed alliance will be consummated or, if
consummated will be profitable.

SERVICES

General

Coromed offers a full range of services that encompass the
preclinical drug research and clinical drug development processes. Coromed
believes that its knowledge and experience in all stages of pharmaceutical
research enhance its credibility with prospective clients. Coromed's full
range of services and global experience complement the research and development
departments of pharmaceutical and biotechnology companies.

Drug Research

To assist clients in the identification and preclinical
development of novel therapeutics, the Biological Research Division provides a
full range of pharmacological testing systems, with particular expertise in
cardiovascular and respiratory/pulmonary pharmacology. Coromed works closely
with clients to identify the most appropriate design and procedures to serve
the study objective. Results are analyzed and summarized in comprehensive
scientific reports suitable for publication or regulatory submission.
Complementing Coromed's Chemistry Division, the Biological Research Division
can assess synthesized compounds for activity in a full range of
pharmacological testing systems.

Coromed's Chemistry Division offers extensive chemical
synthesis and analytical services to the pharmaceutical, biotechnology, and
chemical industries. Organic chemists employed by Coromed, who are experienced
in medicinal chemistry and drug development, are available to serve clients'
chemical research needs. Synthesized substances are prepared in a
confidential, economical and timely manner. All products are accompanied by
complete documentation which carefully details chemical processes and
analytical results.

Drug Development

Coromed provides a full range of drug development services,
including clinical trials management, clinical data management, biostatistical
analysis, study design, medical writing, quality assurance and regulatory
affairs services. Coromed provides these services individually or as an
integrated package of services.

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Coromed offers complete services for the design, initiation
and management of clinical trial programs, a critical element in obtaining
regulatory approval for drugs. Although Coromed specializes in cardiovascular,
oncology/AIDS, and pulmonary/respiratory areas, Coromed has also performed
services in connection with trials in most therapeutic areas, including central
nervous system, infectious disease, metabolic disorders, obstetrics and
gynecology, genitourinary, and rheumatology. Coromed's multi-disciplinary
clinical trials group can examine a product's existing preclinical and clinical
data to design clinical trials to establish the product's safety and efficacy
profile.

Clinical trials are monitored to ensure strict adherence to
Good Clinical Practice guidelines and regulations. The design of efficient
Case Report Forms ("CRFs"), detailed operations manuals and site visits by
Coromed's clinical research associates ensure that clinical investigators and
their staffs follow the established protocols of the studies. Coromed has
adopted standard operating procedures which are intended to satisfy regulatory
requirements and serve as a tool to promote the high quality of Coromed's
clinical services worldwide.

Clinical trials represent one of the most expensive and
time-consuming parts of the overall drug development process. The information
generated during these trials is critical for gaining marketing approval from
the United States Food and Drug Administration (the "FDA") or other regulatory
agencies. Coromed's Clinical Affairs Division assists clients with one or more
of the following steps:

. Study Protocol Design. The protocol defines
the medical issues the study seeks to examine and the
statistical tests that will be conducted. Accordingly, the
protocol defines the frequency and type of laboratory and
clinical measures that are to be tracked and analyzed. The
protocol also defines the number of patients required to
produce a statistically valid result, the period of time
over which they must be tracked and the frequency and
dosage of drug administration. The study's success depends,
in part, on the protocol's ability to predict correctly the
requirements of the regulatory authority.

. Case Report Forms Design. Once the study
protocol has been finalized, CRFs must be developed. The CRF
may change at different stages of a trial. The CRFs for one
patient in a given study may consist of 100 or more pages.

. Site and Investigator Recruitment. The drug
is administered to patients by physicians, referred to as
investigators, at hospitals, clinics or other locations,
referred to as sites. Potential

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investigators may be identified by the drug sponsor or by Coromed.
Coromed generally solicits the investigators' participation in the
study. The trial's success depends on the successful identification
and recruitment of investigators with an adequate base of patients who
satisfy the requirements of the study protocol. Coromed has access to
and experience with several thousand investigators who have conducted
clinical trials.

. Patient Enrollment. The investigators find and enroll
patients suitable for the study. The speed with which trials can be
completed is significantly affected by the rate at which patients are
enrolled. Prospective patients are required to review information
about the drug and its possible side effects, and sign an informed
consent form to record their knowledge and acceptance of potential side
effects. Patients also undergo a medical examination to determine
whether they meet the requirements of the study protocol. Patients then
receive the drug and are examined by the investigator as specified by
the study protocol.

. Study Monitoring and Data Collection. As patients are
examined and tests are conducted in accordance with the study protocol,
data are recorded on CRFs and laboratory reports. The data are
collected from study sites by specially trained persons known as
monitors. Monitors visit sites regularly to ensure that the CRFs are
completed correctly and that all data specified in the protocol are
collected. The monitors take completed CRFs to the study coordinating
site, where the CRFs are reviewed for consistency and accuracy before
their data is entered into an electronic database. Coromed's study
monitoring and data collection services comply with the FDA's adverse
events reporting guidelines.

. Medical Services. Throughout the course of a clinical
trial, Coromed's physicians can provide a range of medical research and
consulting services, including medical monitoring of clinical trials.

Coromed's data management personnel assist in the design of
CRFs, as well as training manuals for investigators, to ensure that data are
collected in an organized and consistent format. Databases are designed
according to the analytical specifications of the project and the particular
needs of the client. Prior to data entry, Coromed personnel screen the data to
detect errors, omissions and other deficiencies in completed CRFs. Coromed
provides clients with data abstraction, data review and coding, data entry,
database verification and editing and problem data query resolution.

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Coromed has extensive experience in the creation of
scientific databases for all phases of the drug development process, including
the creation of customized databases to meet client-specific formats,
integrated databases to support New Drug Application ("NDA") submissions and
databases in strict accordance with regulatory specifications. For example,
Coromed is currently preparing the design of a single database which will
incorporate the safety data for all clinical studies (including those developed
by Coromed, as well as those developed by other contractors) in order to
perform the overall safety analysis, listings, and tables required for NDA
documentation.

Coromed's biostatistics personnel assist clients with all
phases of drug development, including biostatistical consulting, database
design, data analysis and statistical reporting. These individuals develop and
review protocols, design appropriate analysis plans and design report formats
to address the objectives of the study protocol as well as the client's
individual objectives. Working with the programming staff, biostatisticians
perform appropriate analyses and produce tables, graphs, listings and other
applicable displays of results according to the analysis plan.

Working closely with clinical, statistical, regulatory, and
quality assurance experts, Coromed's medical writers develop documents in
accordance with regulatory guidelines and industry standards. Such documents
include clinical/statistical study reports, U.S. and international regulatory
submissions, safety and efficacy summaries, clinical investigator brochures,
protocols, and manuscripts and abstracts for publication.

Coromed provides complete inspection and auditing services
to assure the overall quality of research, as well as to ensure full compliance
with U.S. and international regulations and guidelines. These services support
clients' preclinical safety and efficacy studies, including those subject to
Good Laboratory Practice regulations and clinical studies under Good Clinical
Practice guidelines and regulations. Additionally, Coromed provides inspection
and auditing of facilities for compliance with Good Manufacturing Practice
regulations. Coromed's Quality Assurance and Compliance experts can audit
studies conducted by Coromed, the client or another organization.

Further supporting clients' clinical development projects,
Coromed prepares the specialized documents required for conducting clinical
trials and submitting regulatory applications, and also assists with U.S. and
international regulatory matters. Regulatory affairs services include
compilation, filing and maintenance of U.S. and international regulatory
submissions for new drugs, medical devices, and diagnostics, as well as
development of regulatory strategies and consultation on regulatory issues.
Coromed's regulatory specialists interact directly with regulatory authorities
on the client's behalf.

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INFORMATION SYSTEMS

Coromed has invested in information technology designed to
help it provide high quality services in a cost effective manner to clients and
to manage its internal resources. Coromed's wide area network and electronic
communications systems connect approximately 100 computers worldwide, exclusive
of secure and direct links to clients for communications and data-transfer
activities. Coromed's data management and biostatistics functions are
performed with SAS(TM) in an Axiant(TM)/Oracle client/server environment.
Proprietary ClinTrace(TM) and internally-developed Oracle(R) serious adverse
event systems and computerized project tracking/scheduling applications are
used to effectively manage clients' large-scale domestic and multinational
clinical research projects. Coromed's information systems are designed to work
in support of and reinforce Coromed's standard operating procedures. Coromed's
information technology system is open and flexible, thus allowing it to be
adapted to the multiple needs of clients. Coromed's experience with additional
information systems and technologies, such as remote data entry, fax
technology, and cost-accounting systems, also provide efficient and effective
support to clients' clinical development and regulatory activities. SAS(TM),
Axiant(TM), ClinTrace(TM), and Oracle(TM) are service marks or trade marks
owned by The SAS Institute Incorporated, Cognos Incorporated, Domain Solutions
Corporation, and Oracle Corporation, respectively.

CLIENTS

Since its founding in 1989, Coromed has served over 100
clients in the pharmaceutical and biotechnology industries including 15 of the
top 20 pharmaceutical companies in North America and 10 of the top 15
pharmaceutical companies worldwide. Coromed has provided research and
development services to major North American, European and Japanese
pharmaceutical and biotechnology companies. Coromed has expanded
geographically primarily through internal growth, supplemented by strategic
business relationships, with a goal of serving all major client markets
worldwide and positioning Coromed to serve developing markets. Among CROs,
Coromed is distinctive in having recognized operations in South America.
Approximately 60% of Coromed's clients are pharmaceutical companies and
approximately 40% are biotechnology companies. To date, the number of clients
in the medical device industry has not been significant.

COMPETITION

Coromed primarily competes against in-house departments of
pharmaceutical companies, full service CROs, and, to a lesser extent,
universities and teaching hospitals. Some of these competitors have
substantially greater capital, technical and other resources than Coromed.
CROs generally compete on the basis of previous experience, medical and
scientific expertise in specific therapeutic areas, the quality of contract
research, the ability to organize and manage large-scale trials on a global

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basis, the ability to manage large and complex medical databases, the ability
to provide statistical and regulatory services, the ability to recruit
investigators, the ability to integrate information technology with systems to
improve the efficiency of contract research, an international presence with
strategically located facilities, financial viability and price. Coromed
believes that it competes favorably in these areas.

The CRO industry is highly fragmented, with participants
ranging from several hundred small, limited service providers to several large,
full-service CROs with global operations. Large CROs include ClinTrials
Research, Inc., Covance Inc., Pharmaceutical Product Development, Inc. and
Quintiles Transnational Corporation. The trend toward CRO industry
consolidation has resulted in heightened competition among the larger CROs for
clients and acquisition candidates. In addition, consolidation within the
pharmaceutical industry as well as a trend toward the concentration by
pharmaceutical companies of outsourcing among fewer CROs has led to heightened
competition for CRO contracts. Coromed believes its specialization in
particular therapeutic areas, its complementary drug research (preclinical) and
drug development (clinical) services, and its international presence are
significant competitive strengths.

EMPLOYEES

As of December 31, 1996, Coromed had approximately 155
employees, of which 11 hold Ph.D. or M.D. degrees. Approximately 77% of the
full-time employees are located at the corporate headquarters and 23% are
located in Coromed's other domestic or foreign offices. In addition, Coromed
has consulting agreements with 8 M.D.s from different therapeutic areas which
Coromed utilizes on an as-needed basis to enhance its drug development
services.

FACILITIES

Coromed generally leases all of its facilities. Coromed's
corporate offices are located in Albany, New York, where it leases
approximately 23,500 square feet under a lease that expires in 1999. Coromed
also maintains U.S. offices in San Diego, California; Harrison, Arkansas; and
Shreveport, Louisiana. Coromed's Canadian subsidiary is located in Montreal,
Canada. Coromed's South American subsidiary is located in Buenos Aires,
Argentina. Coromed's European office is in Ghent, Belgium.

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MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS OF COROMED

RESULTS OF OPERATIONS

The following table sets forth for the periods indicated
certain financial data as a percentage of net revenue and the percentage change
in these items compared to the prior comparable period. The trends illustrated
in the following table may not be indicative of future results.

<TABLE>
<CAPTION>
Percentage of Net Revenue Percentage Increase
------------------------- (Decrease)
----------
Six Months
Ended Fiscal Year Six Fiscal Fiscal
December 31, Ended June 30, Months 1995 1994
------------ -------------- 1995 to to to
1996 1995 1996 1995 1994 1996 1996 1995
---- ---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net revenue . . . . . 100% 100% 100% 100% 100% 5.5% 66.7% 51.5%
----- ---- ---- ---- -----

Costs and expenses:

Direct costs . . . 73.6 56.3 59.9 56.6 64.5 38.2 77.2 32.9

Selling,
general and
administrative . . . 26.5 21.1 23.7 26.6 37.4 32.6 49.0 7.8

Depreciation and
amortization . . . 2.0 1.8 1.7 2.4 3.4 17.1 18.8 5.9
----- ---- ---- ---- -----

Total operating
expenses . . . . . . 102.1 79.2 85.3 85.6 105.3 36.2 66.7 23.1
----- ---- ---- ---- -----

Income (loss) from
operations . . . . . (2.1)% 20.8% 14.7% 14.4% (5.3)% (110.9)% 71.1% 509.6%
===== ==== ==== ==== =====
</TABLE>

Direct costs consist of compensation and related fringe benefits for
employees engaged on client projects, other project-related costs not
reimbursed and information systems costs. Selling, general and administrative
expenses consist of compensation and related fringe benefits for selling and
administrative employees, professional services (e.g., accounting and legal)
and advertising costs, as well as leasing and other costs related to
facilities.

Net revenue from Coromed's foreign Subsidiaries for fiscal years 1996,
1995, 1994 and six months ended December 31, 1996 constituted 9.85%, 6.45%,
7.22% and 8.92% of Coromed's net revenues, respectively. (See footnote 11,
Foreign Operations of the consolidated financial statements).

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Six Months Ended December 31, 1996 Compared to Six Months Ended December 31,
1995

Net revenue increased by $238,000, or 5.5%, to $4.5 million for the six
months ended December 31, 1996 from $4.3 million for the six months ended
December 31, 1995. This net revenue growth was primarily attributable to an
increase in the volume of drug research projects serviced by Coromed. Net
revenue, however, was unfavorably impacted by the completion of a large study
in June 1996. Although Coromed commenced a larger drug development study in
October 1996, the timing of the completion and the commencement of these two
studies unfavorably impacted Coromed's net revenues.

Direct costs increased by $927,000, or 38.2%, to $3.3 million for the
six months ended December 31, 1996 from $2.4 million for the six months ended
December 31, 1995. This increase is primarily attributable to the increase in
clinical study personnel associated with the growth in the business that
occurred in fiscal year 1996. In addition, the staff of the data management
division increased by 54% to increase Coromed's data management capacity and
capabilities. Direct costs as a percentage of net revenue increased to 73.6%
for the six months ended December 31, 1996 from 56.3% for the six months ended
December 31, 1995. This increase is primarily due to the inability to allocate
labor and overhead costs to client projects, primarily clinical study and data
management personnel, due to the completion of a particularly large study in
June 1996. With the commencement of another large study in October 1996 and
the potential for additional large studies in the near future, project and data
management personnel were not reduced during the six months ended December 31,
1996.

Selling, general and administrative expenses increased by $297,000, or
32.6% to $1.2 million for the six months ended December 31, 1996 from $910,000
for the six months ended December 31, 1995. This increase was primarily due to
increased administrative personnel, hiring and facilities costs, in line with
management's objective of increasing infrastructure to accommodate Coromed's
anticipated growth. Selling, general and administrative expenses as a
percentage of net revenue increased to 26.5% for the six months ended December
31, 1996 from 21.1% for the six months ended December 31, 1995 primarily due to
increased marketing efforts.

Depreciation and amortization expense increased by $13,000, or 17.1%, to
$90,000 for the six months ended December 31, 1996 from $77,000 for the six
months ended December 31, 1995. The increase was primarily due to increased
capital spending on computer equipment to support the increase in project
related personnel. Depreciation and amortization as a percentage of net
revenue increased to 2.0% for the six months ended December 31, 1996 from 1.8%
for the six months ended December 31, 1995.

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Income (loss) from operations decreased by $1.0 million, or 110.9%, to a
loss of $98,100 for the six months ended December 31, 1996 from income of
$900,500 for the six months ended December 31, 1995. This decrease was the
result of underabsorption of labor and overhead costs during the period from
June 1996 to October 1996 as a result of the completion of a large clinical
study in June and the commencement of another large clinical study in October
1996.

Other income (expenses) improved by $11,000, or 158% to a net income of
$4,000 for the six months ended December 31, 1996 from a net expense of $7,000
for the six months ended December 31, 1995. This improvement resulted from an
increase in interest income achieved from higher average balances of cash and a
reduction in interest expense as a result of debt repayment.

Coromed's effective income tax rate was 39% for the six months ended
December 31, 1996 as compared to 22.5% for the six months ended December 31,
1995. The lower effective rate for the six months ended December 31, 1995 was
primarily attributable to the use of net operating loss carryovers.

Fiscal Year Ended June 30, 1996 Compared To Fiscal Year June 30, 1995

Net revenue increased by $3.8 million, or 66.7%, to $9.4 million for
fiscal 1996 from $5.6 million for fiscal 1995. This net revenue growth was
primarily attributable to an increase in the number and average contract value
of clinical research projects serviced by Coromed.

Direct costs increased by $2.5 million, or 77.2%, to $5.7 million for
fiscal 1996 from $3.2 million for fiscal 1995. This increase in direct costs
was due to the increase in the number of project-related personnel, expansion
of facilities, and information system costs necessary to support the increased
level of operations. Direct costs as a percentage of net revenue increased to
59.9% for fiscal 1996 from 56.6% for fiscal 1995, primarily due to less than
maximal personnel utilization in the period of transition from completed
projects to the initiation of new projects.

Selling, general and administrative expenses increased by $736,000, or
49.0%, to $2.2 million for fiscal 1996 from $1.5 million for fiscal 1995. This
increase was primarily due to increased costs associated with additional
administrative personnel, greater hiring and selling costs, facilities
expansion to support Coromed's growth, principally in the U.S. and in South
America. Selling, general and administrative expenses as a percentage of net
revenue decreased to 23.7% for fiscal 1996 from 26.6% for fiscal 1995,
primarily due to Coromed's expanded revenue base.

Depreciation and amortization expense increased by $25,600, or 18.8%, to
$162,000 for fiscal 1996 from $136,500 for fiscal

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1995. The increase resulted from an increase in depreciation associated with
increased capital expenditures. Depreciation and amortization as a percentage
of net revenue decreased to 1.7% for fiscal 1996 from 2.4% for fiscal 1995.

Income from operations increased by $580,000, or 71.1%, to $1.4 million
for fiscal 1996 from $815,000 for fiscal 1995. This increase was primarily
attributable to an increase in the number and average contract value of
clinical research projects with modest growth in operating expenses.

Other income (expenses) improved by $36,000, or 112.6%, to a net income
of $4,000 for fiscal 1996 from a net expense of $32,000 for fiscal 1995. This
improvement was primarily due to interest income as a result of higher average
balances of cash.

Coromed's effective income tax rate was 22.5% for fiscal 1996 as
compared to 9.6% for fiscal 1995. The lower effective rate for fiscal 1995 was
primarily attributable to US taxable income being fully offset by net operating
loss carryovers in fiscal 1995 but only partially offset in fiscal 1996.

Fiscal Year Ended June 30, 1995 Compared to Fiscal Year Ended June 30, 1994

Net revenue increased by $1.9 million, or 51.5%, to $5.6 million for
fiscal 1995 from $3.7 million for fiscal 1994. This increase was primarily due
to an increase in fiscal 1995 (over 1994) of the volume of clinical research
projects of $1.6 million, or 84%, and an increase in the volume of drug
research projects of $304,000, or 16%.

Direct costs increased by $800,000, or 32.9%, to $3.2 million for fiscal
1995 from $2.4 million for fiscal 1994. Substantially all of the increase in
direct costs was due to increased expenses associated with hiring of additional
project-related personnel and the expansion of facilities. Direct costs as a
percentage of net revenue decreased to 56.6% in fiscal 1995 from 64.5% in
fiscal 1994. This decrease was primarily due to the increased work force
utilization.

Selling, general and administrative expenses increased by $107,000, or
7.8%, to $1.5 million in fiscal 1995 from $1.4 million in fiscal 1994. The
increase in selling, general and administrative expenses was due to continued
development of infrastructure to support expanded operations. Due to the
comparative increase in the volume of projects and related revenue,
administrative expenses as a percentage of net revenue decreased to 26.6% in
fiscal 1995 from 37.4% for fiscal 1994.

Depreciation and amortization expenses increased by $8,000, or 5.9%, to
$135,000 in fiscal 1995 from $128,000 in fiscal 1994. This increase was
primarily due to increased capital spending in computer systems to support the
increase in projects.

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Depreciation and amortization as a percentage of net revenue decreased to 2.4%
fiscal 1995 from 3.4% for fiscal 1994.

Income from operations increased by $1.0 million, or 509.6%, to income
of $815,000 for fiscal 1995 from a loss of $199,000 for fiscal 1994. This
increase was primarily attributable to an increase in the volume of clinical
and drug research projects with modest growth in operating expenses.

Other income (expenses) increased by $6,000, or 24.8%, to $32,000 in
fiscal 1995 from a net expense of $26,000 in fiscal 1994. The change was
primarily due to the discontinuance of a state sponsored job incentive program
in fiscal 1994 which reduced other income.

The effective tax rate in fiscal 1995 was 9.6% as compared to (32.3)% in
fiscal 1994. The higher effective tax rate for fiscal 1994 as compared with
fiscal 1995 was primarily attributable to a higher proportion of taxable income
from foreign operations in fiscal 1994 and the use of net operating loss
carryovers in fiscal 1995.

Liquidity and Capital Resources

Since its inception, Coromed has primarily financed its operations and
growth from cash flow from operations and from the sale of company stock
primarily through its employee stock purchase plan and through private
investment. These funds have been used for working capital and capital
expenditures primarily for information systems improvements and facilities
expansion.

Coromed requires working capital to meet expenses which may not be then
currently covered from project revenues. Coromed's drug development contracts
are generally fixed price with some variable components, and range in duration
from a few months to several years. Its drug research contracts are also fixed
price and range in duration from a few days to a few months. The cash flows
from contracts typically consists of a down payment required to be paid at the
time the contract is entered into and the balance in installments over the
contract's duration. Revenue from contracts is generally recognized on a
percentage of completion basis as the work is performed. Accordingly, cash
receipts do not necessarily correspond to costs incurred and revenue recognized
on contracts. Coromed's cash flow is influenced by the changes in levels of
billed and unbilled accounts receivable, net of amounts advance billed
representing unearned revenue. As a result, the number of days outstanding in
accounts receivable, net of advance billings, and the related dollar values of
these accounts can vary due to the achievement of contractual milestones and
the timing and size of cash receipts. The number of days revenue outstanding,
net of advance billings, averages generally 30 to 45 days.

During fiscal years 1996 and 1995 Coromed progressively recovered from
the losses experienced in the initial phases of

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its business development, and has continued to pay down debt. Although Coromed
has made no firm commitment to acquire additional fixed assets, Coromed is
evaluating additional information systems that would allow more efficient
processing of large volumes of clinical data. Coromed believes that additional
resources for such expansion could be sourced from Omnicare following the
Merger.

Coromed does not have nor has it applied for a line of credit. However,
Coromed believes that as a result of its performance during the most recent two
fiscal years, that it would be favorably positioned to establish a line of
credit to support variations in cash flow caused by the transition from
completed projects to the initiation of new projects.

The foregoing statements include forward-looking statements which
involve risks and uncertainties. Coromed's actual experience may differ
materially from that discussed above. Factors that might cause such a
difference include, but are not limited to those discussed elsewhere in this
document, as well as future events that may have the effect of reducing
Coromed's available cash balances.

57
<PAGE> 68
BENEFICIAL OWNERSHIP OF COROMED COMMON STOCK

The following table sets forth, as of the date of this Proxy
Statement/Prospectus, the number of shares of Coromed Common Stock beneficially
owned by: (i) each person who is known by Coromed to beneficially own five
percent (5%) or more of the outstanding shares of Coromed Common Stock, (ii)
each director and executive officer of Coromed, and (iii) all of Coromed's
directors and executive officers as a group.

<TABLE>
<CAPTION>
AMOUNT AND
NATURE OF PERCENTAGE OF OUTSTANDING
NAME AND ADDRESS OF BENEFICIAL OWNER(1) BENEFICIAL OWNERSHIP(5) SHARES OWNED
- --------------------------------------- ----------------------- -------------------------
<S> <C> <C>
Dale B. Evans(2) 150,628 22.86%
Alice G. Fedory(3) 148,886 22.70
Thomas J. Massey(4) 130,347 20.03
Ronald E. Weishaar(5) 56,995 8.37
Joan R. Dembinski6 53,623 8.36
All executive officers and directors as 486,856 65.98%
a group(4 persons)(2)(3)(4)(5) ------- -----
</TABLE>

__________________________________

(1) Unless otherwise noted, Coromed believes that all persons named in the
table have sole voting and investment power with respect to all shares
beneficially owned by them. Each beneficial owner s percentage ownership is
determined by assuming that options that are held by such person (but not those
held by any other person) and which are exercisable within 60 days of the date
of this Proxy Statement/ Prospectus have been exercised. The address for Dale
B. Evans, Alice G. Fedory, Thomas J. Massey, Ronald E. Weishaar and Joan R.
Dembinski is Coromed, Inc., Rensselaer Technology Park, 185 Jordan Road, Troy,
New York 12180-7615.

(2) Includes (a) 9,243 shares of common stock issuable upon the exercise of
options at a price of $2.20 per share, (b) 12,000 shares of common stock
issuable upon the exercise of options at a price of $3.30 and (c) 1,500 shares
of common stock issuable upon the exercise of options at a price of $5.50.

(3) Includes (a) 7,655 shares of common stock issuable upon the exercise of
options at a price of $2.20 per share, (b) 10,750 shares of common stock
issuable upon the exercise of options at a price of $3.30 per share and (c)
1,250 shares of common stock issuable upon the exercise of options at a price
of $5.50 per share.

(4) Includes (a) 4,166 shares of common stock issuable upon the exercise of
options at a price of $2.20 per share, (b) 9,500 shares of common stock
issuable upon the exercise of options at a price of $3.30 per share and (c)
1,000 shares of common stock issuable upon the exercise of options at a price of
$5.50 per share.

(5) The amount shown for Dr. Weishaar includes (a) 1,250 shares jointly
owned by Dr. Weishaar and his spouse, (b) 25,495 shares of common stock
issuable upon the exercise of options at a price of $2.00 per share, (c) 14,250
shares of common stock issuable upon the exercise of options at a price of
$3.00 per share and (d) 5,000 shares of common stock issuable upon the exercise
of options at a price of $5.00 per share.

(6) Includes (a) 3,685 shares of common stock issuable upon the exercise of
options at a price of $2.00 per share and (b) 1,000 shares of common stock
issuable upon the exercise of options at a price of $3.00 per share.

58
<PAGE> 69
EXPERTS

The consolidated balance sheets of Coromed, Inc. and Subsidiaries
as of June 30, 1996 and 1995 and the related consolidated statements of
operations, stockholders equity (deficiency), and cash flows for each of the
three years in the period ended June 30, 1996, included in this Proxy
Statement/Prospectus and the related Registration Statement have been included
herein in reliance on the report of Coopers & Lybrand L.L.P., independent
accountants, given on the authority of that firm as experts in accounting and
auditing.

The consolidated financial statements of Omnicare incorporated in
this Proxy Statement/Prospectus by reference to the Annual Report on Form 10-K
of Omnicare for the year ended December 31, 1995 and the Current Report on Form
8-K of Omnicare filed February 6, 1997, have been so incorporated in reliance
on the reports of Price Waterhouse LLP, independent accountants, given on the
authority of said firm as experts in auditing and accounting.

LEGAL OPINIONS

The validity of the Omnicare Common Stock to be issued by
Omnicare in connection with the Merger will be passed upon by Dewey Ballantine,
New York, New York.

Certain tax matters relating to the Merger will be passed upon
for Coromed by Morgan, Lewis & Bockius LLP, Philadelphia, Pennsylvania.

59
<PAGE> 70
COROMED, INC. AND SUBSIDIARIES

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

<TABLE>
<S> <C>
Report of Independent Accountants F-2

Consolidated Statements of Operations for the years ended June 30, 1996, 1995 and 1994 and
unaudited for the six months ended December 31, 1996 and 1995
F-3
Consolidated Balance Sheets at June 30, 1996 and 1995 and unaudited at December 31, 1996
F-4

Consolidated Statements of Stockholders' Equity (Deficiency) for the years ended June 30, 1996,
1995 and 1994 and unaudited for the six months ended December 31, 1996

F-5

Consolidated Statements of Cash Flows for the years ended June 30, 1996, 1995 and 1994 and
unaudited for the six months ended December 31, 1996 and 1995
F-6
Notes to Consolidated Financial Statements F-7
</TABLE>

F-1
<PAGE> 71
REPORT OF INDEPENDENT ACCOUNTANTS

To the Board of Directors
and Stockholders of
Coromed, Inc. and Subsidiaries

We have audited the accompanying consolidated balance sheets of Coromed, Inc.
and Subsidiaries as of June 30, 1996 and 1995 and the related consolidated
statements of operations, stockholders' equity (deficiency) and cash flows for
each of the years in the three-year period ended June 30, 1996. These
financial statements are the responsibility of Coromed's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.

We conducted our audits 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 audits provide a reasonable basis
for our opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the consolidated financial position of Coromed, Inc. and
Subsidiaries as of June 30, 1996 and 1995 and the consolidated results of their
operations and their cash flows for each of the years in the three-year period
ended June 30, 1996, in conformity with generally accepted accounting
principles.

COOPERS & LYBRAND L.L.P.

Albany, New York
August 16, 1996
(except with respect
to the matters discussed
in Note 14, as to which
the date is January 27, 1997.)

F-2
<PAGE> 72
COROMED, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>
Six months ended For the year ended
December 31, June 30,
-------------------------- --------------------------------------
1996 1995 1996 1995 1994
---- ---- ---- ---- ----
(Unaudited)
<S> <C> <C> <C> <C> <C>
Drug development (Clinical,
Program Management and
Quality Assurance) $3,834,051 $3,800,661 $8,250,874 $4,367,615 $2,965,911

Drug research (Chemistry and
Biology) 720,423 515,806 1,215,350 1,288,272 768,100
---------- ---------- ---------- ---------- ----------

Net Revenue 4,554,474 4,316,467 9,466,224 5,655,887 3,734,011
---------- ---------- ---------- ---------- ----------

Operating Expenses
Direct costs 3,356,083 2,429,166 5,668,041 3,199,317 2,407,862
Selling, general and
administrative 1,206,523 909,960 2,240,965 1,504,810 1,397,410
Depreciation and
amortization 89,953 76,790 162,118 136,506 127,759
---------- ---------- ---------- ---------- ----------

Total Operating expenses 4,652,559 3,415,916 8,071,124 4,840,633 3,933,031
---------- ---------- ---------- ---------- ----------

Income (loss) from
operations (98,085) 900,551 1,395,100 815,254 (199,020)

Other income 13,802 8,342 30,560 6,612 16,712

Interest expense (9,768) (15,293) (26,571) (38,337) (42,137)
---------- ---------- ---------- ---------- ----------

Income (loss) before
provision for income
taxes (94,051) 893,600 1,399,089 783,529 (224,445)

Provision (benefit) for income
taxes (36,680) 201,060 314,824 74,834 72,425
---------- ---------- ---------- ---------- ----------

Net income (loss) (57,371) 692,540 $1,084,265 $ 708,695 $ (296,870)
========== ========== ========== ========== ==========

Earnings (loss) per share
Primary $(0.09) $1.08 $1.60 $1.21 $(0.59)
Fully Diluted $(0.09) $1.08 $1.60 $1.21 $(0.59)

Weighted average shares
outstanding
Primary 617,370 642,107 675,673 594,000 502,254
Fully Diluted 617,370 642,107 675,673 594,000 502,254
</TABLE>

The accompanying notes are an integral part of these
Consolidated Financial Statements

F-3
<PAGE> 73
COROMED, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

<TABLE>
ASSETS December 31, 1996 June 30,
----------------- --------
(Unaudited)
1996 1995
---------- ----------
<S> <C> <C> <C>
Current assets:
Cash and cash equivalents $ 421,025 $1,714,137 $ 537,077
Accounts receivable, net of allowance for bad debts
of $33,000 and $0 at June 30, 1996 and 1995 and
$41,000 at December 31, 1996 1,675,626 1,119,380 1,148,354
Prepaid expenses and other current assets 85,481 39,662 67,965

Officer and employee loans and advances 39,927 22,250 9,750
---------- ---------- ----------
Total current assets 2,222,059 2,895,429 1,763,146

Fixed assets, net 716,934 620,149 545,699
Deferred tax asset 141,419 104,739
Other assets 11,520 6,050 14,230
-------- ---------- ----------
$3,091,932 $3,626,367 $2,323,075
========== ========== ==========

LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIENCY)

Current liabilities:
Current maturities of long-term debt $ 92,234 $ 102,198 $ 138,134
Current obligations under capitalized leases 32,258 22,986 17,357
Accounts payable 69,397 77,290 165,801
Accrued expenses 307,713 469,062 345,177
Deferred revenue 575,886 730,489 1,242,269
Clinical investigation advances 1,107,650 965,679 445,774
Income taxes payable 293,189 72,725
---------- ---------- ----------
Total current liabilities 2,185,138 2,660,893 2,427,237
---------- ---------- ----------

Noncurrent liabilities:
Long-term debt, less current maturities 41,995 137,263
Obligation under capitalized leases, less current
obligations 25,928 12,786 18,353
---------- ---------- ----------
Total Noncurrent liabilities 25,928 54,781 155,616
---------- ---------- ----------

Total Liabilities 2,211,066 2,715,674 2,582,853
---------- ---------- ----------

Commitments

Stockholders' equity (deficiency):
Common stock; par value $.01; 2,000,000 shares
authorized; June 1996 - 752,054 shares issued,
609,442 outstanding, June 1995 - 697,672 shares
issued, 572,215 outstanding; December 1996 -
780,339 issued, 636,122 outstanding, 7,805 7,521 6,977
Additional paid-in capital 918,861 813,431 641,994
Retained earnings (accumulated deficit) 167,020 224,391 (859,874)
---------- ---------- ----------
1,093,686 1,045,343 (210,903)
Common Stock Notes Receivable (54,096)
Treasury stock, at cost (June 1996 - 142,612 shares;
June 1995 - 125,457 shares;and December 1996 -
144,217) (158,724) (134,650) (48,875)
----------- ---------- ----------
Total Stockholders' equity
(deficiency) 880,866 910,693 (259,778)
---------- ----------
$3,091,932 $3,626,367 $2,323,075
========== ========== ==========
</TABLE>

The accompanying notes are an integral part of these
Consolidated Financial Statements

F-4
<PAGE> 74
COROMED, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF
STOCKHOLDERS' EQUITY (DEFICIENCY)

<TABLE>
<CAPTION>
Retained
Common Additional Earnings Common
Common Stock Paid-in (Accumulated Treasury Stock Notes
Stock Subscribed Capital Deficit) Stock Receivable Total
----- ---------- ------- -------- ----- ---------- -----
<S> <C> <C> <C> <C> <C> <C> <C>
BALANCE, JUNE 30, 1993 $6,004 $17,787 $359,735 $(1,271,699) $ (19,375) $ -0- $ (907,548)
Treasury stock purchased (6,636) (6,636)
Issuance of committed stock 59 (17,787) 17,728
Stock issued for consulting services 22 6,599 6,621
Stock issued under employee stock purchase
plan 60 15,438 15,498
Stock issued to employees in lieu of cash
compensation 67 19,973 20,040
Net proceeds from sale of common stock 40 11,960 12,000
Stock committed but unissued for stock
subscribed under employee stock
purchase plan 2,183 2,183
Stock committed but unissued for consulting
services 8,295 8,295
Net loss (296,870) (296,870)
------ ------- -------- ----------- --------- -------- ----------

BALANCE, JUNE 30, 1994 6,252 10,478 431,433 (1,568,569) (26,011) -0- (1,146,417)
Treasury stock purchased (22,864) (22,864)
Issuance of committed stock 36 (10,478) 10,442
Stock issued for consulting services 70 20,825 20,895
Stock issued under employee stock purchase
plan 159 41,747 41,906
Net proceeds from sale of common stock 150 44,902 45,052
Stock issued for repayment of related party
debt 70 20,930 21,000
Stock issued to employees in lieu of cash
compensation 240 71,715 71,955
Net income 708,695 708,695
------ ------- -------- ----------- --------- -------- ----------

BALANCE, JUNE 30, 1995 6,977 -0- 641,994 (859,874) (48,875) -0- (259,778)
Treasury stock purchased (85,775) (85,775)
Stock issued under employee stock purchase
plan 196 68,945 69,141
Net proceeds from sale of common stock 335 98,755 99,090
Stock issued to employees in lieu of cash
compensation 13 3,737 3,750
Net income 1,084,265 1,084,265
------ ------- -------- ----------- --------- -------- ----------
BALANCE, JUNE 30, 1996 7,521 -0- 813,431 224,391 (134,650) -0- 910,693

Options Exercised 241 52,753 (54,096) (1,102)
Treasury stock purchased (24,074) (24,074)
Stock issued under employee stock purchase
plan 38 45,933 45,971
Stock issued to employees in lieu of cash
compensation 5 6,744 6,749
Net (Loss) (57,371) (57,371)
------ ------- -------- ----------- --------- -------- ----------
BALANCE, DECEMBER 31, 1996
(UNAUDITED) $7,805 $ -0- $918,861 $167,020 $(158,724) $(54,096) $880,866
====== ======= ======== =========== ========= ======== ==========
</TABLE>

The accompanying notes are an integral part of these
Consolidated Financial Statements

F-5
<PAGE> 75
COROMED, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
INCREASE (DECREASE) IN CASH AND CASH Six months
EQUIVALENTS ended December 31, For the year ended June 30,
-------------------------- ---------------------------------------
1996 1995 1996 1995 1994
---------- ---------- ---------- -------- ---------
(Unaudited)
<S> <C> <C> <C> <C> <C>
Cash flows from operating activities:
Net income (loss) $(57,371) $692,540 $1,084,265 $708,695 $(296,870)
Adjustments to reconcile (loss) net income
to net cash provided by operating
activities:
Depreciation and amortization of fixed
assets 89,953 76,790 162,118 133,091 122,424
Amortization of deferred costs 3,415 5,335
Provision for bad debts 8,000 33,000
Gain on sale of fixed assets (1,931)
Services provided in exchange for common
stock 6,750 3,750 92,850 34,956
Deferred tax asset (36,680) (104,739) (104,739)
Changes in operating assets and
liabilities:
Prepaid taxes (35,978)
Accounts receivable (564,246) (1,194,338) (4,026) (652,208) 181,284
Prepaid expenses and other current
assets (9,841) 11,118 28,303 (26,454) (4,673)
Officer and employee loans and
advances (17,677) (40,950) (12,500) 19,655 34,862
Accounts payable (7,893) 60,920 (88,511) (171,785) 92,458
Accrued expenses (161,349) (141,838) 123,885 (293,106) (49,618)
Deferred revenue (154,603) 443,685 (511,780) 851,502 (3,864)
Income taxes payable (293,189) 207,445 220,464 300 72,425
Other assets (5,470) 11,303 8,180 (14,230)
---------- ---------- ---------- -------- ---------
Net cash provided by operating
activities (1,239,594) 21,936 940,478 651,725 188,719
---------- ---------- ---------- -------- ---------

Cash flows from investing activities:
Proceeds from sale of fixed assets 2,020
Purchase of fixed assets (186,738) (94,149) (216,357) (115,064) (80,081)
---------- ---------- ---------- -------- ---------
Net cash used in investing activities (186,738) (94,149) (214,337) (115,064) (80,081)
---------- ---------- ---------- -------- ---------

Cash flows from financing activities:
Proceeds from borrowings 38,000 13,800
Clinical investigation advances, net 141,971 758,427 519,905 72,372 (56,330)
Proceeds from sales of common stock 44,869 131,432 168,231 86,958 29,681
Proceeds from issuance of debt 47,770
Principal payments on debt (51,959) (81,569) (131,204) (121,286) (109,486)
Principal payments on obligations under
capital leases (15,587) (10,717) (20,238) (14,764) (13,637)
Purchase of treasury stock (24,074) (85,775) (22,864) (6,636)
---------- ---------- ----------- -------- ---------
Net cash provided by (used in) financing
activities 133,220 811,373 450,919 416 (108,638)
---------- ---------- ---------- -------- ----------

Net increase in cash (1,293,112) 739,160 1,177,060 537,077 -0-

Cash and cash equivalents, beginning
of year 1,714,137 537,077 537,077 -0- -0-
---------- ---------- ---------- -------- ---------

Cash and cash equivalents, end of year $ 421,025 $1,276,237 $1,714,137 $537,077 $ -0-
========== ========== ========== ======== =========
</TABLE>

The accompanying notes are an integral part of these
Consolidated Financial Statements

F-6
<PAGE> 76
COROMED, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Data as of and for the six months
ended December 31, 1996 and 1995 are unaudited)

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Organization: Coromed, a Delaware corporation, was
incorporated in June 1989 and initiated business on October 9, 1989. On
December 15, 1993, Coromed formed 3103-3798 Quebec, Inc. (Coromed Canada), a
wholly owned Canadian-based subsidiary. As part of its strategy to become an
international Contract Research Organization (CRO), Coromed in June of 1994
proceeded to establish a presence in Europe and in South America, with the
opening of branch offices in Ghent, Belgium, and Buenos Aires, Argentina. On
July 15, 1995, Coromed formed Coromed S.A. (Coromed South America), a
majority-owned Argentina-based Subsidiary, which was established from Coromed's
branch office in Buenos Aires, Argentina. These actions enhanced Coromed's
opportunities for involvement in worldwide drug development programs with its
clients. With bases of operation in the U.S. (east and west coasts), Canada,
Argentina, and Belgium, Coromed offers clients the requisite resources for
executing and managing international clinical trials and programs in multiple
therapeutic areas with special emphasis in cardiovascular, oncology and AIDS.
In addition, Coromed provides support to its clients in the pre-clinical areas
of chemistry and biology.

Principles of consolidation: The consolidated financial
statements include the accounts of Coromed, Coromed Canada and Coromed S. A.
Significant intercompany accounts and transactions have been eliminated in the
consolidation.

Unaudited interim financial information: The accompanying
consolidated balance sheet as of December 31, 1996, and the related
consolidated statements of operations and cash flows for the six months ended
December 31, 1996 and 1995, and the statement of stockholders' equity for the
six months ended December 31, 1996, are unaudited, but in the opinion of
management, include all adjustments, consisting of normal recurring
adjustments, necessary for a fair presentation of results for these interim
periods. Certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally accepted accounting
principles have been omitted, although Coromed believes that the disclosures
included are adequate to make the information presented not misleading. The
results of operations for the six months ended December 31, 1996 are not
necessarily indicative of the results to be expected for the entire fiscal
year.

Use of estimates: The preparation of financial statements in
conformity with generally accepted accounting

The accompanying notes are an integral part of these
Consolidated Financial Statements

F-7
<PAGE> 77
principles requires management to make estimates and assumptions that affect
the reported amounts of assets and liabilities and disclosure of contingent
assets and liabilities at the date of the financial statements and the reported
amounts of revenues and expenses during the reporting period. Management
estimates and assumptions include allowance for bad debts, revenue recognized
on the percentage of completion method and recoverability periods of long-lived
assets. Actual results could differ from those estimates.

Concentration of credit risk: Coromed maintains cash balances
at one U.S. bank with a bank balance of $1,603,907 at June 30, 1996. This
balance is insured by the Federal Deposit Insurance Corporation up to $100,000.
In addition, at June 30, 1996, Coromed has $327,534 of uninsured cash in
foreign bank accounts.

In each of the periods, the fiscal year ended June 30, 1996
and the six months ended December 31, 1996, Coromed derived approximately 59%
of its revenue from contracts with two clients.

Cash and Cash Equivalents: For the purpose of the Cash Flows
Statement, Coromed defines cash and cash equivalents as cash and investments
with original maturities of three months or less.

Fixed assets: Fixed assets are recorded at cost at the date
of acquisition. Renewals and betterments are capitalized. Repairs and
maintenance are charged to earnings as incurred. Upon retirement or disposal
of assets, the applicable costs and accumulated depreciation will be eliminated
from the accounts and the resulting gain or loss included in income.

Capitalized leased assets and leasehold improvements are
amortized over the shorter of their estimated useful life or lease term.

Depreciation is computed by the straight-line method for
financial reporting purposes over the following estimated useful lives:

<TABLE>
<CAPTION>
YEARS
-----
<S> <C>
Laboratory equipment 3-15
Furniture, fixtures and office equipment 3-10
Capital leases 3-10
Leasehold improvements 3-15
</TABLE>

Revenue recognition: Coromed records revenue as services are
provided. Income from long-term contracts is recognized on the percentage of
completion method.

Deferred revenue: Deferred revenue represents advances
received from clients to be applied to future services.

The accompanying notes are an integral part of these
Consolidated Financial Statements

F-8
<PAGE> 78
Income taxes: In accordance with Statement of Financial
Accounting Standards No. 109, Accounting for Income Taxes (SFAS 109), deferred
tax assets and liabilities are recognized for the future tax consequences
attributable to differences between the financial statement carrying amounts of
existing assets and liabilities and their respective tax basis. Deferred tax
assets and liabilities are measured using enacted tax rates expected to apply
to taxable income in the years in which those temporary differences are
expected to be recovered or settled. The effect of changes in tax rates is
recognized in income in the period that includes the date of enactment. A
valuation allowance is established to reduce deferred tax assets if it is more
likely than not that all, or some portion, of such deferred tax asset will not
be realized.

Foreign currency translation: All balance sheet amounts have
been translated using the exchange rates in effect at the balance sheet dates.
All income statement amounts have been translated using the average rates in
effect for each year. Gains and losses on foreign currency transactions have
been included in income.

Computation of Earnings Per Share: Earnings per share is
computed using the weighted average number of common and dilutive common
equivalent shares outstanding during the period. Dilutive common equivalent
shares consist of stock options using the modified treasury stock method.

2. ACCOUNTS RECEIVABLE

Accounts receivable consist of the following:

<TABLE>
<CAPTION>
December 31, June 30,
------------ --------------------------
1996 1996 1995
---- ---- ----
(unaudited)
<S> <C> <C> <C>
Billed receivables 1,100,846 $ 826,550 $ 617,416
Unbilled receivables 505,942 284,543 448,159
Unbilled reimbursable expenses 109,838 41,287 82,779
--------- ---------- ----------

1,716,626 1,152,380 1,148,354
Allowance for bad debts (41,000) (33,000)
--------- ---------- ----------
1,675,626 $1,119,380 $1,148,354
========= ========== ==========
</TABLE>

Bad debt expense amounted to $33,000, $0 and $0 for the years ended
June 30, 1996, 1995 and 1994, respectively ($8,000 for the six months ended
December 31, 1996).

The accompanying notes are an integral part of these
Consolidated Financial Statements

F-9
<PAGE> 79
3. FIXED ASSETS

Fixed assets consist of the following:

<TABLE>
<CAPTION>
December 31, June 30,
------------ --------------------------
1996 1996 1995
---- ---- ----
(unaudited)
<S> <C> <C> <C>
Laboratory equipment 460,843 $ 452,410 $ 422,760
Office equipment 362,423 283,964 178,582
Furniture and fixtures 172,312 136,301 85,503

Leasehold improvements 293,057 286,230 205,959
Capital leases - equipment -
12/31/96 auto 232,505 193,505 173,205
Assets not placed in service 38,792
--------- ---------- ----------
1,521,140 1,352,410 1,104,801
Accumulated depreciation (668,275) (609,805) (456,778)
Accumulated amortization
under capital leases (135,931) (122,456) (102,324)
--------- ---------- ----------
$ 716,934 $ 620,149 $ 545,699
========= ========== ==========
</TABLE>

Depreciation expense for the years ended June 30, 1996, 1995
and 1994 was $141,986, $110,043, and $99,627, respectively, and for the six
months ended December 31, 1996 was $76,478. Amortization expense on capital
leases for the years ended June 30, 1996, 1995 and 1994 was $20,132, $23,048,
and $22,797, respectively, and for the six months ended December 31, 1996 was
$13,475.

4. ACCRUED EXPENSES

Accrued expenses consist of the following:

<TABLE>
<CAPTION>
December 31, June 30,
------------ -------------------------
1996 1996 1995
---- ---- ----
(unaudited)
<S> <C> <C> <C>
Accrued liabilities $ 224,089 $ 140,001 $ 55,579
Accrued vacation 29,837 57,438 56,819
Accrued bonus 245,161
Accrued payroll taxes 53,787 26,462 201,301
Accrued payroll tax penalties and interest 31,478
--------- --------- ---------
$ 307,713 $ 469,062 $ 345,177
========= ========= =========
</TABLE>

5. CLINICAL INVESTIGATION ADVANCES

Coromed has entered into agreements with third parties whereby
Coromed is retained for the purposes of identifying and recruiting clinical
investigators to conduct clinical studies under Coromed's supervision. Under
the terms of these agreements, the expenses associated with paying the clinical
investigators are to be borne by the third party.

As of June 30, 1996 and 1995, Coromed was holding client funds
in the amounts of $965,679, and $445,774, respectively, to be used for the
payment of clinical investigators. As of December 31, 1996, Coromed was
holding funds amounting to $1,107,650.

The accompanying notes are an integral part of these
Consolidated Financial Statements

F-10
<PAGE> 80
6. DEBT

Long-term debt consists of the following:

<TABLE>
<CAPTION>
December 31, June 30,
---------------- ---------------------------
1996 1996 1995
---- ---- ----
(unaudited)
<S> <C> <C> <C>
Bank loans (1) 92,234 $144,193 $241,009
Other (2) 34,388
---------- -------- --------
92,234 144,193 275,397
Less current maturities 92,234 102,198 138,134
---------- -------- --------
Long-term portion -0- $ 41,995 $137,263
========== ======== ========
</TABLE>

____________________

(1) Small Business Administration loan with a maximum authorized
borrowing limit of $500,000 bearing interest at prime plus 2%
(10.25% at June 30, 1996 and December 31, 1996), payable in
equal monthly installments of $8,826, including interest,
maturing in 1997 and collateralized by accounts receivable and
fixed assets and personally guaranteed by certain of Coromed's
officers/stockholders. At June 30, 1996 and 1995, the balance
outstanding under this agreement was $116,812 and $199,343,
respectively. At December 31, 1996, the balance was $71,996.

Installment loan agreement with a bank, bearing interest at
prime plus 2% (10.25% at June 30, 1996 and December 31, 1996).
The loan, which matures in April 1998, is to be repaid in
equal monthly installment principal payments of approximately
$1,190 plus interest. At June 30, 1996 and 1995, the balance
outstanding under this agreement was $27,381 and $41,666,
respectively. At December 31, 1996, the balance was
$20,237.84.

(2) Note payable to an officer/stockholder of Coromed with
interest payable at 5% per annum. The note was paid prior to
June 30, 1996. Interest expense was approximately $700 and
$2,300 for the years ended June 30, 1996 and 1995,
respectively.

Annual principal requirements on long-term debt at June 30,
1996 are as follows:

<TABLE>
<S> <C>
Fiscal 1997 $102,198
Fiscal 1998 41,995
--------
$144,193
========
</TABLE>

7. LEASES

Coromed leases certain laboratory and office equipment under
capital lease obligations which expire in 2000. Future minimum lease payments
at June 30, 1996 are as follows:

<TABLE>
<S> <C>
Fiscal 1997 $26,865
Fiscal 1998 7,128
Fiscal 1999 6,879
Fiscal 2000 1,170
-------
Total minimum lease payments 42,042
Amounts representing interest (6,270)
--------
Present value of net minimum lease payments 35,772
Current obligations 22,986
-------
Long-term portion $12,786
=======

</TABLE>

Coromed leases office and laboratory space and office equipment under various
noncancelable operating leases. The following is a schedule of future minimum
rental payments required under the above operating leases as of June 30, 1996:

<TABLE>
<CAPTION>
Year Ending
June 30,
---------------------------------
<S> <C>
1997 $287,566
1998 285,312
1999 288,132
2000 102,626
--------
$963,636
========
</TABLE>

Total rental expense incurred under noncancelable operating leases was
$258,250, $172,049 and $186,028 for the years ended June 30, 1996, 1995 and
1994, respectively. For December 31, 1996 and 1995, the amounts were $202,002
and $152,350, respectively.

8. COMMON STOCK

Coromed issued shares of common stock at board-approved prices
of $3 to $5 per share in fiscal 1996 and $3 per share in fiscal 1995 and 1994.
Net proceeds from such issuances were $99,090, $45,052 and $12,000 for the
years ended June 30, 1996, 1995 and 1994, respectively.

In 1994, Coromed entered into a consulting agreement with a
non-affiliated party to provide technical consulting services to Coromed.
During the year ended June 30, 1994, Coromed issued 2,207 shares and was
committed to issue an additional 2,765 shares of its common stock at $3 per
share (fair value as determined by the Board of Directors) in lieu of $14,916
of cash compensation for services provided. During the year ended June 30,
1995, Coromed issued 6,965 shares of its common stock at $3 per share (fair
value as determined by the Board of Directors) in lieu of $20,895 of cash
compensation for services provided.

The accompanying notes are an integral part of these
Consolidated Financial Statements

F-11
<PAGE> 81
In lieu of $3,750, $71,955 and $20,040 compensation for
services performed by employees during the years ended June 30, 1996, 1995 and
1994, respectively, Coromed issued 1,250, 23,985 and 6,680 shares of its common
stock at $3 per share (fair value as determined by the Board of Directors).

During the year ended June 30, 1995, Coromed issued 7,000
shares of common stock at a board-approved price of $3 per share in lieu of a
$21,000 payment to an officer towards the repayment of a note payable.

The accompanying notes are an integral part of these
Consolidated Financial Statements

F-12
<PAGE> 82
9. INCOME TAXES

The provision for income taxes for the years ended June 30,
1996, 1995 and 1994 consists of:

<TABLE>
<CAPTION>
1996 1995 1994
---- ---- ----
<S> <C> <C> <C>
Current:
Federal $269,291 $ 3,600 $
State 71,076 21,771
Foreign 79,196 49,463 72,425
-------- ------- ------
419,563 74,834 72,425
-------- ------- ------
Deferred:
Federal (84,668)
State (20,071)
--------- ------- -------
(104,739)
--------- ------- -------
Income tax expense $314,824 $74,834 $72,425
======== ======= =======
</TABLE>

A reconciliation of the federal statutory rate to Coromed's
effective tax rate is as follows:

<TABLE>
<CAPTION>
1996 1995 1994
---- ---- ----
<S> <C> <C> <C>
Statutory tax rate 34.0% 34.0% 34.0%
State taxes, net 5.4 1.8 6.0
Change in valuation allowance (30.0) (30.0) (38.8)
Foreign taxes 3.0 (2.0) (22.2)
Nondeductible expenses 1.1 1.8 (11.3)
--- --- ------
Effective tax rate 22.5% 9.6% (32.3%)
----- ---- ------
</TABLE>

The sources of deferred income tax and the related tax effect
for the years ended June 30, 1996 and 1995 are as follows:

<TABLE>
<CAPTION>
1996 1995
---- ----
<S> <C> <C>
Allowance for doubtful accounts $ 13,246 $
Accrued expenses 28,695 10,364
Deferred revenue 68,030
Valuation allowance (64,877)
-------- --------
Total current deferred income taxes $109,971 $ 0
======== ========

Fixed asset depreciation $(5,232) $
Net operating loss carryforwards 229,146
Valuation allowance (229,146)
-------- --------
Total long-term deferred income taxes $ (5,232) $ 0
======== ========
</TABLE>

The valuation allowance for deferred tax assets at June 30,
1996 and 1995 was $0 and $294,023 respectively. The valuation allowance
decreased by $234,696 from June 30, 1994 to June 30, 1995 and was eliminated at
June 30, 1996. Taxable income in the carry back period is sufficient to
realize the benefit of deferred tax assets at June 30, 1996.

10. EMPLOYEE BENEFIT PLANS

Stock Plans: Over the years, the board of directors has
approved the adoption of various stock option plans. Under these option plans,
substantially all employees are eligible to receive options to purchase up to
an aggregate of 300,000 shares at an exercise price which cannot be less than
the fair value of the shares on the date the options are granted. Activity
with respect to these plans is as follows:

The accompanying notes are an integral part of these
Consolidated Financial Statements

F-13
<PAGE> 83
<TABLE>
<CAPTION> Options Exercise Price
------- --------------
<S> <C> <C>
Options outstanding and exercisable at June 1, 1993 161,544

Options granted 6,533 $3.00
Options exercised 0
Options expired (2,476) 2.00
-------
Options outstanding and exercisable at June 30, 1994 165,601

Options granted 15,227 3.00-3.30
Options exercised (722) 2.00
Options expired (947) 2.00
--------

Options outstanding and exercisable at June 30, 1995 179,159

Options granted 23,760 3.00 - 5.50
Options exercised (1,545) 2.00
Options expired ( 250) 3.00
---------

Options outstanding and exercisable at June 30, 1996 201,124

Options granted 65 15.00
Options exercised (24,088) 2.20
Options expired 0
-------

Options outstanding and exercisable at December 31,
1996 177,101
</TABLE>

Effective October 1, 1990, the board of directors approved the
adoption of the employee stock purchase plan. The stock purchase plan expires
September 30, 2001. Under the stock purchase plan, substantially all employees
are eligible to purchase annually up to an aggregate of 50,000 shares of
Company common stock (1,000,000 shares in the aggregate over the life of the
plan) at a price equal to the lesser of 85% of the fair value of a share on the
date of grant or purchase date. During the years ended June 30, 1996, 1995 and
1994, Coromed issued 19,587 shares at purchase prices ranging from $2.55 to
$5.00, 15,873 shares at purchase prices ranging from $2.55 to $3.00, and 13,004
shares at purchase prices ranging from $2.55 to $3.00 (3,547 shares at purchase
prices ranging from $12.75 to $15.00 for the six months ended December 31,
1996). As of June 30, 1996, 941,250 shares remain available to be issued under
this plan (937,703 shares as of December 31, 1996).

Defined Contribution Plan: Effective January 1, 1993,
Coromed implemented a defined contribution 401(k) Savings Plan which covers
substantially all employees who have met certain minimum age and service
requirements. Employees may contribute up to 15% of their annual salary (up to
the maximum established by the IRS each year) to the Plan. Coromed may, at its
option, make a discretionary contribution. No employer contributions were made
to the Plan during the years ended June 30, 1996, 1995 and 1994, and for the
six months ended December 31, 1996.

The accompanying notes are an integral part of these
Consolidated Financial Statements

F-14
<PAGE> 84
11. FOREIGN OPERATIONS

Summarized financial data of Coromed Canada as of and for the
years ended June 30, 1996, 1995 and 1994 and Coromed S.A. as of and for the
year ended June 30, 1996 is as follows:

<TABLE>
<CAPTION> 1996 1995 1994
---- ---- ----
<S> <C> <C> <C>
Net revenue
United States $8,533,366 $5,291,139 $3,464,467
Canada 500,103 364,948 269,544
South America 432,755
-------- ----------- ----------

9,466,224 5,655,887 3,734,011
--------- ----------- ----------

Net Income (Loss)
United States 1,057,228 630,309 (409,027)
Canada 110,739 78,386 112,157
South America (83,702)
---------- ----------- ----------
1,084,265 708,695 (296,870)
---------- ----------- ----------

Assets

United States 3,249,740 1,973,894 920,631
Canada 314,025 349,181 213,572
South America 62,602
--------- -------- --------
3,626,367 2,323,075 1,134,203
--------- --------- ---------
</TABLE>

12. SUPPLEMENTAL CASH FLOW DISCLOSURES

During fiscal 1996, 1995 and 1994, Coromed entered into the
following noncash transactions:

<TABLE>
<CAPTION> 1996 1995 1994
---- ---- ----
<S> <C> <C> <C>
Acquired equipment under capital leases $20,300 $2,149 $
Converted common stock subscribed to common stock
and additional paid-in capital 10,478 17,787
Common stock issued to pay debt 21,000
</TABLE>

Also, Coromed paid $26,569, $46,857 and $38,367 in interest during the years
ended June 30, 1996, 1995 and 1994, respectively. In addition, Coromed paid
$156,179, $70,316, and $0 in income taxes for the years ended June 30, 1996,
1995 and 1994, respectively.

13. FAIR VALUE OF FINANCIAL INSTRUMENTS

The following methods and assumptions were used to estimate
the fair value of each class of financial instruments for which it is
practicable to estimate that value:

Cash and cash equivalents: The carrying amount of cash and
cash equivalents ($1,714,137 at June 30, 1996) approximates fair value because
of the short maturity of those instruments.

Debt: The carrying amount of Coromed's long-term debt
($144,193 at June 30, 1996) approximates fair value. Fair values were
estimated based on current interest rates offered to Coromed for debt with
similar terms and maturities.

The accompanying notes are an integral part of these
Consolidated Financial Statements

F-15
<PAGE> 85
Obligations under capital leases: The carrying amount of
Coromed's obligations under capital leases ($35,772 at June 30, 1996)
approximates fair value. Fair value is based on current interest rates offered
to Coromed for obligations under capital leases with similar terms and
maturities.

14. SUBSEQUENT EVENT

On January 27, 1997, Coromed and certain stockholders of
Coromed entered into the Merger Agreement. Pursuant to the agreement,
Omnicare, Inc. will acquire all of the equity of Coromed for $40 million in
Omnicare common stock. The merger is intended to be accounted for as a pooling
of interests upon satisfaction of the conditions for such accounting treatment,
and is subject to the approval of the stockholders of Coromed.

15. ACCOUNTING STANDARDS

Statement of Financial Accounting Standards No. 121
(Accounting For The Impairment Of Long-lived Assets And For Long-lived Assets
To Be Disposed Of) is effective for fiscal years beginning after December 15,
1995. Coromed adopted this statement on July 1, 1996. The adoption of this
statement is not expected to have a material effect on Coromed's financial
condition or results of operation. Statement of Financial Accounting Standards
No. 123 (Accounting For Stock-Based Compensation) is effective for fiscal years
beginning after December 15, 1995. Coromed adopted this statement on July 1,
1996. Coromed has elected to continue to apply APB Opinion No. 25 in
accounting for its stock-based compensation arrangements. The information for
pro-forma disclosure is presently not known.

The accompanying notes are an integral part of these
Consolidated Financial Statements

F-16
<PAGE> 86
APPENDIX A

AGREEMENT AND PLAN OF MERGER

AGREEMENT AND PLAN OF MERGER (this "Agreement"), dated as of
January 27, 1997, by and among Omnicare, Inc., a Delaware corporation
("Omnicare"), Coromed Acquisition Corporation, a Delaware corporation and a
wholly-owned subsidiary of Omnicare ("Merger Sub"), COROMED, Inc., a Delaware
corporation ("Company"), and each of the stockholders of Company appearing as
signatories hereto (each a "Stockholder" and collectively, the "Stockholders").

RECITALS

A. The Boards of Directors of Omnicare and Company each have
determined that a business combination between Omnicare and Company is in the
best interests of their respective companies and stockholders and presents an
opportunity for their respective companies to achieve long-term strategic and
financial benefits, and accordingly have agreed to effect the merger provided
for herein upon the terms and subject to the conditions set forth herein.

B. Concurrently with the execution of this Agreement, in order
to induce Omnicare and Merger Sub to enter into this Agreement, Company and the
Stockholders are entering into a support agreement (the "Support Agreement")
with Omnicare providing for certain arrangements with respect to the shares of
Company Common Stock (as defined in Section 4.2 below) beneficially owned by the
Stockholders upon the terms and conditions specified therein.

C. For federal income tax purposes, it is intended that the
merger provided for herein shall qualify as a reorganization within the meaning
of Section 368 of the Internal Revenue Code of 1986, as amended (the "Code"),
and for financial accounting purposes shall be accounted for as a pooling of
interests.

D. Merger Sub is a wholly owned subsidiary of Omnicare created
for purposes of effecting the acquisition contemplated herein and will be merged
with and into Company.

E. Omnicare, Merger Sub, Company and the Stockholders desire
to make certain representations, warranties and agreements in connection with
the merger.

NOW, THEREFORE, in consideration of the foregoing, and of the
representations, warranties, covenants and agreements contained herein, the
parties hereto hereby agree as follows:

ARTICLE 1

THE MERGER

1.1. The Merger. Subject to the terms and conditions of this
Agreement, at the Effective Time (as defined in Section 1.3), Merger Sub shall
be merged with and into Company in accordance with this Agreement, and the
separate corporate existence of Merger Sub shall thereupon cease (the "Merger").
Company shall be the surviving corporation in the Merger (sometimes hereinafter
referred to as the "Surviving Corporation"). The Merger shall have the effects
specified in the Delaware General Corporation Law (the "DGCL").

A-1

<PAGE> 87
1.2. The Closing. Subject to the terms and conditions of this
Agreement, the closing of the Merger (the "Closing") shall take place (a) at the
offices of Dewey Ballantine, 1301 Avenue of the Americas, New York, New York, at
10:00 a.m., local time, on the first business day immediately following the day
on which the last to be fulfilled or waived of the conditions set forth in
Article 9 shall be fulfilled or waived in accordance herewith or (b) at such
other time, date or place as Omnicare and Company may agree. The date on which
the Closing occurs is hereinafter referred to as the "Closing Date."

1.3. Effective Time. If all the conditions to the Merger set
forth in Article 9 shall have been fulfilled or waived in accordance herewith
and this Agreement shall not have been terminated as provided in Article 11, the
parties hereto shall cause a Certificate of Merger meeting the requirements of
Section 251 of the DGCL to be properly executed and filed in accordance with
such Section on the Closing Date. The Merger shall become effective at the time
of filing of the Certificate of Merger with the Secretary of State of the State
of Delaware in accordance with the DGCL or at such later time which the parties
hereto shall have agreed upon and designated in such filing as the effective
time of the Merger (the "Effective Time").

ARTICLE 2

CERTIFICATE OF INCORPORATION AND
BYLAWS OF THE SURVIVING CORPORATION

2.1. Certificate of Incorporation. The Certificate of
Incorporation of Merger Sub in effect immediately prior to the Effective Time
shall be the Certificate of Incorporation of the Surviving Corporation, until
duly amended in accordance with applicable law.

2.2. Bylaws. The Bylaws of Merger Sub in effect immediately
prior to the Effective Time shall be the Bylaws of the Surviving Corporation,
until duly amended in accordance with applicable law.

ARTICLE 3

DIRECTORS AND OFFICERS OF THE
SURVIVING CORPORATION

3.1. Directors. The directors of Merger Sub immediately prior
to the Effective Time shall be the directors of the Surviving Corporation as of
the Effective Time and until their successors are duly appointed or elected in
accordance with applicable law.

3.2. Officers. The officers of Merger Sub immediately prior to
the Effective Time shall be the officers of the Surviving Corporation as of the
Effective Time and until their successors are duly appointed or elected in
accordance with applicable law.

ARTICLE 4

EFFECT OF THE MERGER ON SECURITIES OF
MERGER SUB AND COMPANY

4.1. Merger Sub Stock. At the Effective Time, each share of
common stock, par value $.01 per share, of Merger Sub outstanding immediately
prior to the Effective Time shall be converted into and exchanged for one
validly issued, fully paid and non-assessable share of common stock, par value
$.01 per share, of the Surviving Corporation.

A-2

<PAGE> 88
4.2. Company Securities. (a) At the Effective Time, each share
of common stock, par value $.01 per share (the "Company Common Stock"), of
Company issued and outstanding immediately prior to the Effective Time (other
than Restricted Shares (as defined in Section 4.2(b), shares of Company Common
Stock to be cancelled pursuant to Section 4.2(d) and any Dissenting Shares, as
defined below) shall, by virtue of the Merger and without any action on the part
of the holder thereof, be converted into the right to receive such number of
shares of common stock, par value $1.00 per share (the "Omnicare Common Stock"),
of Omnicare that equals the result obtained by calculation pursuant to the
following formula:

40,000,000
----------------
Y
X = ----------------
Z

where X is the number of shares of Omnicare Common Stock to be issued in
exchange for each share of Company Common Stock (the "Exchange Ratio"); Y is the
average of the closing price per share of Omnicare Common Stock on the New York
Stock Exchange Composite Tape (as reported in the Wall Street Journal) on each
of the five consecutive trading days immediately preceding the second trading
day prior to the Closing Date (the "Average Closing Price"); and Z is the total
number of shares of Company Common Stock to be exchanged in the Merger for
shares of Omnicare Common Stock, including the total number of shares of Company
Common Stock deemed to be outstanding immediately prior to the Effective Time
pursuant to Section 4.2(b) in respect of and in lieu of all options to acquire
Company Common Stock and Restricted Shares, in each case outstanding immediately
prior to the Effective Time.

(b) At the Effective Time, each option to acquire Company
Common Stock outstanding immediately prior to the Effective Time (each a
"Company Option") and each share of Company Common Stock that is an "Unvested
Share," as such term is defined in the shareholders agreement to which such
share is subject (each such share, a "Restricted Share") outstanding immediately
prior to the Effective Time shall, by virtue of the Merger and without any
action on the part of the holder thereof, be converted into the right to receive
such number of shares of Omnicare Common Stock that equals the Exchange Ratio
multiplied by the Deemed Shares with respect to such Company Option or
Restricted Share; "Deemed Shares" shall mean the number of shares of Company
Common Stock deemed to be outstanding with respect to and in lieu of all Company
Options and Restricted Shares outstanding immediately prior to the Effective
Time, calculated as follows:

(i) with respect to each Company Option that is a vested
option, the number of shares subject to such option multiplied by the
applicable current value discount determined by Wessels, Arnold &
Henderson, L.L.C. ("WAH") (or such other financial advisory firm
mutually agreed upon by the Company and Omnicare) and agreed to by
Coopers & Lybrand L.L.P. and Price Waterhouse LLP;

(ii) with respect to each Company Option that is a non-vested
option, the number of shares subject to such option multiplied by the
applicable current value discount determined by WAH (or such other
financial advisory firm mutually agreed upon by the Company and
Omnicare) and agreed to by Coopers & Lybrand L.L.P. and Price
Waterhouse LLP; and

(iii) with respect to Restricted Shares, the number of such
Restricted Shares multiplied by the applicable current value discount
determined by WAH (or such other financial advisory firm mutually
agreed upon by the Company and Omnicare) and agreed to by Coopers &
Lybrand L.L.P. and Price Waterhouse LLP; provided, however, that no
such discount need be applied if the shares of Omnicare Common Stock
received pursuant to the Merger in exchange for the

A-3

<PAGE> 89
Restricted Shares are subject to the same restrictions as those
restrictions imposed upon the Restricted Shares.

(c) As a result of the Merger and without any action on the
part of the holder thereof, at the Effective Time all shares of Company Common
Stock and all Company Options shall cease to be outstanding and shall be
cancelled and retired and shall cease to exist, and each holder of shares of
Company Common Stock (other than shares of Company Common Stock to be cancelled
pursuant to Section 4.2(d) and any Dissenting Shares) or Company Options shall
thereafter cease to have any rights with respect to such shares of Company
Common Stock or Company Options, except the right to receive, without interest,
the Omnicare Common Stock and cash for fractional shares of Omnicare Common
Stock in accordance with Sections 4.3(b) and 4.3(e) upon the surrender of a
certificate or form of unexercised option grant (each, a "Certificate")
representing such shares of Company Common Stock or Company Options.

(d) Each share of Company Common Stock issued and held in
Company's treasury at the Effective Time shall, by virtue of the Merger, cease
to be outstanding and shall be cancelled and retired without payment of any
consideration therefor.

(e) Notwithstanding anything to the contrary contained herein,
in the event that the Average Closing Price per share of Omnicare Common Stock
is $21-1/8 (the "Minimum Price") or lower, then solely for purposes of
calculating the Exchange Ratio, the Average Closing Price per share of Omnicare
Common Stock will be deemed to be the Minimum Price, and in the event that the
Average Closing Price per share of Omnicare Common Stock is $37-1/8 (the
"Maximum Price") or higher, then solely for purposes of calculating the Exchange
Ratio, the Average Closing Price per share of Omnicare Common Stock will be
deemed to be the Maximum Price.

4.3. Exchange of Certificates Representing Company Common
Stock. (a) As of the Effective Time, Omnicare shall deposit, or shall cause to
be deposited, with an exchange agent selected by Omnicare, which shall be
Omnicare's Transfer Agent or such other party reasonably satisfactory to Company
(the "Exchange Agent"), for the benefit of the holders of shares of Company
Common Stock (other than shares of Company Common Stock to be cancelled pursuant
to Section 4.2(c) and any Dissenting Shares) and Company Options, for exchange
in accordance with this Article 4, certificates representing the shares of
Omnicare Common Stock and the cash in lieu of fractional shares (such cash and
certificates for shares of Omnicare Common Stock, together with any dividends or
distributions with respect thereto (relating to record dates for such dividends
or distributions after the Effective Time), being hereinafter referred to as the
"Exchange Fund") to be issued pursuant to Section 4.2 and paid pursuant to this
Section 4.3 in exchange for outstanding shares of Company Common Stock and
Company Options.

(b) Promptly after the Effective Time, Omnicare shall cause
the Exchange Agent to mail to each holder of record of shares of Company Common
Stock (other than shares of Company Common Stock to be cancelled pursuant to
Section 4.2(c) and any Dissenting Shares) and each holder of a Company Option
(i) a letter of transmittal which shall specify that delivery shall be effected,
and risk of loss and title to such shares of Company Common Stock or Company
Options shall pass, only upon delivery of the Certificates representing such
shares or Company Options to the Exchange Agent and which shall be in such form
and have such other provisions as Omnicare may reasonably specify and (ii)
instructions for use in effecting the surrender of such Certificates in exchange
for certificates representing shares of Omnicare Common Stock and cash in lieu
of fractional shares. Upon surrender of a Certificate for cancellation to the
Exchange Agent together with such letter of transmittal, duly executed and
completed in accordance with the instructions thereto, the holder of the shares
or Company Options represented by such Certificate shall be entitled to receive
in exchange therefor (x) a certificate representing that number of whole shares
of Omnicare Common Stock and (y) a check representing the amount of cash in lieu
of fractional shares, if any, which such holder has the right

A-4

<PAGE> 90
to receive in respect of the Certificate surrendered pursuant to the provisions
of this Article 4, after giving effect to any required withholding tax, and the
shares represented by the Certificate so surrendered shall forthwith be
cancelled. No interest will be paid or accrued on the cash in lieu of fractional
shares, if any, payable to holders of shares of Company Common Stock. In the
event of a transfer of ownership of Company Common Stock which is not registered
in the transfer records of Company, a certificate representing the proper number
of shares of Omnicare Common Stock, together with a check for the cash to be
paid in lieu of fractional shares, may be issued to such a transferee if the
Certificate representing such Company Common Stock is presented to the Exchange
Agent, accompanied by all documents required to evidence and effect such
transfer and to evidence that any applicable stock transfer taxes have been
paid.

(c) Notwithstanding any other provisions of this Agreement, no
dividends or other distributions declared after the Effective Time on Omnicare
Common Stock shall be paid with respect to any shares of Company Common Stock
represented by a Certificate until such Certificate is surrendered for exchange
as provided herein. Subject to the effect of applicable laws, following
surrender of any such Certificate, there shall be paid to the holder of the
certificates representing whole shares of Omnicare Common Stock issued in
exchange therefor, without interest, (i) at the time of such surrender, the
amount of dividends or other distributions with a record date after the
Effective Time theretofore payable with respect to such whole shares of Omnicare
Common Stock and not paid, less the amount of any withholding taxes which may be
required thereon, and (ii) at the appropriate payment date, the amount of
dividends or other distributions with a record date after the Effective Time but
prior to surrender and a payment date subsequent to surrender payable with
respect to such whole shares of Omnicare Common Stock, less the amount of any
withholding taxes which may be required thereon.

(d) At or after the Effective Time, there shall be no
transfers on the stock transfer books of Company of the shares of Company Common
Stock which were outstanding immediately prior to the Effective Time. If, after
the Effective Time, Certificates are presented to the Surviving Corporation,
they shall be cancelled and exchanged for certificates for shares of Omnicare
Common Stock and cash in lieu of fractional shares, if any, deliverable in
respect thereof pursuant to this Agreement in accordance with the procedures set
forth in this Article 4. Certificates surrendered for exchange by any person
constituting an "affiliate" of Company for purposes of Rule 145(c) under the
Securities Act of 1933, as amended (the "Securities Act"), shall not be
exchanged until Omnicare has received a written agreement from such person as
provided in Section 8.11.

(e) No fractional shares of Omnicare Common Stock shall be
issued pursuant hereto. In lieu of the issuance of any fractional share of
Omnicare Common Stock pursuant to Section 4.2(b), cash adjustments will be paid
to holders in respect of any fractional share of Omnicare Common Stock that
would otherwise be issuable, and the amount of such cash adjustment shall be
equal to such fractional proportion of the "Average Closing Price" of a share of
Omnicare Common Stock.

(f) Any portion of the Exchange Fund (including the proceeds
of any investments thereof and any shares of Omnicare Common Stock) that remains
unclaimed by the former stockholders or option holders of Company six months
after the Effective Time shall be delivered to Omnicare. Any former stockholder
or option holder of Company who have not theretofore complied with this Article
4 shall thereafter look only to Omnicare for payment of their shares of Omnicare
Common Stock, cash in lieu of fractional shares and unpaid dividends and
distributions on the Omnicare Common Stock deliverable in respect of each share
of Company Common Stock or Company Option such holder holds as determined
pursuant to this Agreement, in each case, without any interest thereon.

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(g) None of Omnicare, Company, the Surviving Corporation, the
Exchange Agent or any other person shall be liable to any former holder of
shares of Company Common Stock or Company Options for any amount properly
delivered to a public official pursuant to applicable abandoned property,
escheat or similar laws.

(h) In the event any Certificate shall have been lost, stolen
or destroyed, upon the making of an affidavit of that fact by the person
claiming such Certificate to be lost, stolen or destroyed and, if required by
the Surviving Corporation, the execution by such person of an agreement to
indemnify the Surviving Corporation against any claim that may be made against
it with respect to such Certificate or such other bond, security or indemnity as
the Exchange Agent may reasonably request, the Exchange Agent will issue in
exchange for such lost, stolen or destroyed Certificate the shares of Omnicare
Common Stock and cash in lieu of fractional shares, and unpaid dividends and
distributions on shares of Omnicare Common Stock as provided in Section 4.3(c),
deliverable in respect thereof pursuant to this Agreement.

4.4. Dissenting Shares. Notwithstanding anything in this
Agreement to the contrary, shares of Company Common Stock that are outstanding
immediately prior to the Effective Time and which are held by stockholders who
shall have perfected dissenters' rights in accordance with Section 262 of the
DGCL (the "Dissenting Shares") shall not be converted into or represent the
right to receive the Exchange Ratio, unless and until such holder shall have
failed to perfect or shall have effectively withdrawn or lost such holder's
rights to appraisal under the DGCL. Any payments to any holder who has exercised
dissenter's rights shall be made by Company out of its own funds. If any such
holder shall have failed to perfect or shall have effectively withdrawn or lost
such holder's rights to appraisal of such shares of Company Common Stock under
the DGCL, such holder's shares shall thereupon be deemed to have been converted
into and to have become exchangeable for, at the Effective Time, the right to
receive, upon surrender as provided above, the Exchange Ratio for the
certificate or certificates that formerly evidenced such shares of Company
Common Stock.

ARTICLE 5

REPRESENTATIONS AND WARRANTIES OF COMPANY

Except as disclosed by Company to Omnicare in writing in the
disclosure schedules being delivered to Omnicare by Company upon or before the
execution hereof (the "Company Schedules") and which Company Schedules shall
identify the specific Sections or subsections in this Agreement to which each
such disclosure relates, Company hereby represents and warrants to Omnicare and
Merger Sub as follows:

5.1. Corporate Organization and Disclosure. (a) Company is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Delaware with all requisite power and authority to own, lease
and operate its properties and to carry on its business as now being conducted.
Company is qualified to do business and is in good standing in each jurisdiction
(domestic, foreign or otherwise) in which the property owned, leased or operated
by it or the nature of the business conducted by it makes such qualification
necessary (except for jurisdictions in which such failure to be so qualified
would not be reasonably likely to have a Material Adverse Effect (as defined in
Section 12.14 below)). Schedule 5.1(a) contains a list of all jurisdictions
where Company is qualified to do business. Neither Company nor any Subsidiary
(as defined in Section 12.13 below) has received any written notice or assertion
from the Secretary of State or comparable official of any jurisdiction to the
effect that Company or any Subsidiary is required to be qualified or otherwise
authorized to do business therein, in which Company has not qualified or
obtained such authorization.

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(b) Complete copies of the charter and all amendments thereto
to the date hereof and the Bylaws (or equivalent organizational documents) as
presently in effect of Company and each Subsidiary have been furnished to
Omnicare. Neither Company nor any Subsidiary is in default in the performance,
observation or fulfillment of its charter or Bylaws (or equivalent
organizational documents).

(c) True and complete copies of the minute books of each of
Company and its Subsidiaries, which contain a complete and correct record in all
material respects of all meetings of the Board of Directors of each of Company
and its Subsidiaries and committees thereof and all meetings of its stockholders
and all actions by written consent without a meeting by such Boards of Directors
and committees thereof and its stockholders since the date of incorporation,
have been furnished to Omnicare. The stock certificate books and records of
Company accurately reflect on the date hereof the ownership of the shares of
Company Common Stock by the persons and in the amounts set forth therein.

5.2. Capitalization. The authorized capital stock of Company
consists solely of 2,000,000 shares of Company Common Stock, of which 636,122
are issued and outstanding, 176,581 shares are reserved for issuance pursuant to
outstanding Company options issued pursuant to the Company's stock option plan
(the "Company Stock Option Plan") and 144,217 are treasury shares. All
outstanding shares of Company Common Stock have been validly issued and are
fully paid, non-assessable and are not subject to any of preemptive rights. The
issuance and sale of all of such shares of Company Common Stock have been in
full compliance with all applicable federal and state securities laws. Except
for the Company options described in the first sentence of this Section 5.2 and
except as set forth on Schedule 5.2 and as contemplated by the Support
Agreement, there are no subscriptions, options, warrants, calls, rights,
contracts, commitments, understandings, restrictions or arrangements relating to
the issuance, sale, transfer or voting of any shares of Company Common Stock or
any other equity security of Company, including any rights of conversion or
exchange under any outstanding securities or other instruments. Except as set
forth on Schedule 5.2 and as contemplated by the Support Agreement, there are no
voting rights or other agreements or understandings with respect to the shares
of Company Common Stock.

5.3. Subsidiaries, Affiliates, Affiliated Companies and Joint
Ventures. Except as set forth in Schedule 5.3, Company does not own any capital
stock or other equity securities of any corporation, has no direct or indirect
equity or ownership interest in, by way of stock ownership or otherwise, any
corporation, partnership, joint venture, association or business enterprise and
is not contemplating acquiring any such interest. Except as set forth on
Schedule 5.3, all entities listed on Schedule 5.3 are wholly owned Subsidiaries
of Company. Schedule 5.3 sets forth the authorized capital stock or other
interests of each such entity, the number of shares of such capital stock or
other interests validly issued and outstanding, the number of such shares or
other interests owned by Company and, in the case any such entity is not a
wholly owned Subsidiary, to the best knowledge of the Company, the names and
numbers of shares or other interests held by any third party in such entity.
Except as set forth on Schedule 5.3, each of the entities listed in Schedule 5.3
is a corporation duly organized, validly existing and in good standing under the
laws of its jurisdiction of incorporation, as listed in Schedule 5.3, has full
corporate power to own, lease and operate its properties and assets and to carry
on its business as and where it is now conducted, is duly qualified to do
business and is in good standing in each jurisdiction in which the character of
the properties owned or leased by it or the nature of the business transacted by
it make such qualification necessary (except for jurisdictions in which such
failure to be so qualified would not be reasonably likely to have a Material
Adverse Effect), and is qualified to do business in the jurisdictions listed in
Schedule 5.3. Company owns beneficially and of record all shares of capital
stock or other interests of any Subsidiary or entity and which shall be set
forth as owned by it in Schedule 5.3, free and clear of any mortgage, claim,
lien, pledge, option, security interest or other similar interest, encumbrance,
easement, judgment or imperfection of title of any nature whatsoever (each an
"Encumbrance"), and,

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except as set forth on Schedule 5.3, none of such shares or interests is subject
to any covenant or other contractual restriction preventing or limiting the
right to transfer such shares. Except as set forth on Schedule 5.3, there are
not any agreements or understandings to which Company or any Subsidiary is a
party with respect to the voting of shares of capital stock of any Subsidiary;
and no Subsidiary has outstanding any options, calls, rights of conversion or
other commitments to purchase or sell any authorized or issued shares of capital
stock of any Subsidiary. There are no contracts, commitments, agreements,
undertakings or restrictions which require Company to issue, sell or deliver any
shares of the capital stock of any Subsidiary.

5.4. Authority. (a) The execution, delivery and performance of
this Agreement and the consummation of the transactions contemplated hereby by
Company have been duly authorized by all requisite corporate action, and no
other acts or proceedings on the part of Company (other than the approval and
adoption of this Agreement and the Merger by the affirmative vote of holders of
a majority of the outstanding shares of Company Common Stock in accordance with
the DGCL and Company's Certificate of Incorporation and Bylaws) are necessary to
authorize this Agreement or the transactions contemplated hereby. This Agreement
has been duly and validly executed and delivered by Company and (assuming due
authorization, execution and delivery by the Stockholders, Omnicare and Merger
Sub) is the legal, valid and binding obligation of Company enforceable against
Company in accordance with its terms, except as enforcement thereof may be
limited by bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting the enforcement of creditors' rights in general, or by general
principles of equity.

(b) Except as set forth in Schedule 5.4, neither the execution
and delivery by Company of this Agreement nor the consummation of the
transactions contemplated hereby nor compliance with any of the provisions
hereof will (i) conflict with or result in a breach of any provision of the
charter or Bylaws (or equivalent organizational documents) of Company or any
Subsidiary, (ii) violate, conflict with, or result in a breach of any provision
of, or constitute a default (or an event which, with notice or lapse of time or
both, would constitute a default) under, or result in the termination or in a
right of termination or cancellation of, or accelerate the performance required
by, or result in the creation of any Encumbrance upon any of the properties of
Company or any Subsidiary or result in being declared void, voidable, without
further binding effect or subject to amendment or modification any of the terms,
conditions or provision of, any note, bond, mortgage, indenture, deed of trust,
any license, franchise, permit, lease, contract, agreement or other instrument
or commitment or obligation to which Company, any Subsidiary or any of their
respective properties may be bound or affected, (iii) violate any order, writ,
injunction, decree, judgment, ruling, law, rule or regulation of any court or
governmental authority, federal, state or foreign, applicable to Company, any
Subsidiary, or to any Stockholder or any of their respective properties, or (iv)
except for (A) applicable requirements of the Hart-Scott-Rodino Antitrust
Improvements Act of 1976 (the "HSR Act"), (B) obtaining the requisite approval
and adoption of this Agreement by the holders of Company Common Stock in
accordance with the DGCL and Company's Certificate of Incorporation and Bylaws,
(C) obtaining the consents approvals authorizations and permits of, and making
filings or notifications to, any governmental authority pursuant to the
applicable requirements, if any, of the Securities Act of 1933, as amended, and
the rules and regulations promulgated thereunder (the "Securities Act"), the
Securities Exchange Act of 1934, as amended, and the rules and regulations
promulgated thereunder (the "Exchange Act"), state securities laws and the rules
and regulations promulgated thereunder (the "Blue Sky Laws"), the National
Association of Securities Dealers, Inc. (the "NASD") and the New York Stock
Exchange, Inc. (the "NYSE") and (D) the filing and recordation of the
Certificate of Merger as required by the DGCL, require any consent, approval or
authorization of, or notice to, or declaration, filing or registration with, any
person or entity except, in the case of clauses (ii), (iii) and (iv) above, as
could not have a Material Adverse Effect or as would not be reasonably likely to
have a material adverse effect on the Company's ability to consummate the
transactions contemplated hereby.

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5.5. Compliance with Laws. (a) Each of Company and its
Subsidiaries and, to the best knowledge of Company, all of their respective
officers, directors, employees, consultants and agents (collectively, the
"Personnel") have complied in all material respects with all applicable
statutes, regulations, rules, orders, ordinances, judgments, decrees, permits,
franchises, licenses and other laws of the United States of America, all state,
local and foreign governments and other governmental bodies and authorities, and
agencies of any of the foregoing ("Governmental Authority") to which it is
subject with respect to drug or medical device investigation or development
regulation or other healthcare regulatory matters (including, without
limitation, the Federal Food, Drug and Cosmetic Act, 21 U.S.C. Section 301 et
seq.; the Animal Welfare Act, 7 U.S.C. Section 2131 et seq.; the Controlled
Substances Act, 21 U.S.C. Section 801 et seq.; Section 1128B(b) and 1877 of the
Social Security Act, 42 U.S.C. Sections 1320a-7(b) and 1395nn (commonly
referred to as the "Federal Anti-Kickback Statute" and the "Stark Statute"
respectively); and implementing regulations related thereto ("Healthcare Laws").
Company and each Subsidiary has maintained all records required to be maintained
by the U.S. Food and Drug Administration (the "FDA"), the Drug Enforcement
Agency, the USDA, the ATF and the State Board of Pharmacy and the Medicare and
Medicaid programs as required by applicable Healthcare Laws and there are no
presently existing circumstances which could result or could be likely to result
in violations of any such Healthcare Laws. Neither Company nor any Subsidiary
has received any notice or other communication to the effect that, or otherwise
been advised or become aware that, it or any activity conducted or monitored by
it is not in compliance with any Healthcare Laws.

(b) Except with respect to Healthcare Laws, Company is and, to
the best knowledge of Company, all Personnel are, in compliance with all
applicable statutes, laws, ordinances, rules, orders and regulations of any
Governmental Authority (including without limitation, Environmental Laws (as
such term is hereinafter defined in Section 5.18) applicable to Company or any
Subsidiary), except to the extent noncompliance could not have a Material
Adverse Effect. Except as set forth on Schedule 5.5(b), neither Company nor any
Subsidiary has received any notice or other communication to the effect that, or
otherwise been advised that, it is not in compliance with any of such statutes,
regulations and orders, ordinances, other laws or undertakings, and Company has
no reason to anticipate that any presently existing circumstances are likely to
result in violations of any such regulations which could have a Material Adverse
Effect.

(c) There are no pharmaceutical or other products now being
investigated by Company or any Subsidiary which at the date hereof would require
any approval or clearance of any governmental or administrative body, whether
federal, state, local or foreign, prior to such investigation for which such
clearance or approval has not been obtained. The business of Company and its
Subsidiaries does not involve the sale, shipment or other distribution of
pharmaceutical or other products including, without limitation, investigational
pharmaceuticals.

(d) Neither Company nor any Subsidiary participates in the
Medicare and Medicaid programs.

(e) Neither Company nor any Subsidiary has made, and, to the
best knowledge of Company, no Personnel or representative of Company or any
Subsidiary or any person acting on behalf of Company or any Subsidiary have
made, directly or indirectly, any bribes, kickbacks, or other illegal payments
or illegal political contributions, illegal payments from corporate funds to
governmental officials in their individual capacities, or illegal payments from
corporate funds to obtain or retain business either within the United States or
abroad. Neither Company nor any Subsidiary has, and, to the best knowledge of
Company, no Personnel have, been convicted of, or pled guilty or nolo contendere
to any, Medicare or Medicaid program related offense, and Company and its
Subsidiaries have not, and to the best knowledge of Company no Personnel have,
committed any offense which may reasonably serve as the basis for suspension or
exclusion from the Medicare and Medicaid programs.

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(f) Neither Company nor any Subsidiary nor, to the best of
Company's knowledge, any of their Personnel have been debarred by the FDA or by
an analogous foreign governmental entity pursuant to the Generic Drug
Enforcement Act ("Drug Enforcement Act") or an analogous foreign law or
regulation; and to the best of Company's knowledge, neither Company nor any
Subsidiary or any of their Personnel are under investigation by the FDA or by an
analogous foreign governmental entity for debarment action pursuant to the Drug
Enforcement Act or an analogous foreign law or regulation.

(g) To the best of Company's knowledge, no subcontractor
utilized by Company or any Subsidiary, no investigator selected by Company or
any Subsidiary and no person employed by any such investigator selected by
Company or any Subsidiary to perform any study, project or other assignment is
under investigation by the FDA or by an analogous foreign governmental entity
for debarment action or has been debarred pursuant to the Drug Enforcement Act
or an analogous foreign law or regulation.

(h) No study or investigation or data generated, supervised or
monitored by Company or any Subsidiary has been determined to be unreliable by
the FDA or other foreign or domestic regulatory agency for any reason, including
failure to comply with Good Manufacturing Practice, Good Clinical Practice or
Good Laboratory Practice regulations or guidance or an analogous foreign law or
regulation. No clinical investigator used by Company or any Subsidiary has, to
the best of Company's knowledge, been disqualified from conducting clinical
investigations by the FDA or other foreign or domestic regulatory agency.

5.6. Licenses. (a) Company and its Subsidiaries have all
material consents, permits, franchises, licenses, concessions, rights,
authorizations and approvals (collectively, "Licenses") of federal, state, local
and foreign governmental authorities and other persons or entities required in
connection with the operation of their respective businesses as now being
conducted, all of which are in full force and effect, not subject to any default
and no suspension or cancellation of any of which is threatened.

(b) No Personnel of Company or its Subsidiaries are engaged as
practicing physicians, nurses or pharmacists on behalf of Company or any
Subsidiary. Schedule 5.6(b) identifies the names of all physicians currently
engaged by or associated with the Company or any Subsidiary and the capacities
in which those physicians are engaged by or associated with the Company or any
Subsidiary. To the best of Company's knowledge, none of the physicians listed on
Schedule 5.6(b) is or has been subject to any claim in connection with service
in capacities similar to the capacities in which such physicians serve or are
associated with the Company or any Subsidiary.

5.7. Financial Statements. Set forth on Schedule 5.7 are true,
correct and complete copies of the following: (i) the audited consolidated
balance sheet of Company and its Subsidiaries as of June 30, 1996, 1995, and
1994, including the notes thereto, accompanied by the report of Coopers &
Lybrand L.L.P. with respect thereto; (ii) the audited statement of income of
Company and its Subsidiaries for the years ended June 30, 1996, 1995, and 1994,
including the notes thereto, accompanied by the report of Coopers & Lybrand
L.L.P. with respect thereto; (iii) the unaudited balance sheet of Company and
its Subsidiaries as of November 30, 1996 (the "Balance Sheet Date") and (iv) the
unaudited statement of income of Company and its Subsidiaries for the period
July 1, 1996 to November 30, 1996. (All of the financial statements referred to
above in this Section 5.7 are hereinafter collectively referred to as the
"Company Financial Statements"). The Company Financial Statements have been
prepared from and are in accordance with the books and records of Company which
are complete and accurate, and the Company Financial Statements fairly present
the financial position, results of operations and changes in financial position
of Company as of the dates and for the periods indicated, in each case in
accordance with United States generally accepted accounting principles ("GAAP").
Company's unaudited financial statements contained in the

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Company Financial Statements were prepared on a basis consistent with Company's
audited financial statements contained in the Company Financial Statements,
subject to normal, recurring year-end adjustments.

5.8. Absence of Undisclosed Liabilities. Except (i) as and to
the extent specifically reserved against (which reserves are adequate in amount)
in Company's audited balance sheet as of June 30, 1996, and in the notes to such
balance sheet for the period then ended, (ii) liabilities which have been
incurred since June 30, 1996 in the ordinary course of business consistent with
past practice as a result of arm's length negotiations, which liabilities would
not be reasonably likely to have a Material Adverse Effect and (iii) liabilities
and obligations specifically disclosed on Schedule 5.8, neither Company nor any
Subsidiary has any material liabilities or obligations of any nature (whether
accrued, absolute, contingent or otherwise and whether due or to become due).

5.9. Absence of Certain Changes. Since November 30, 1996,
there has not been any change in or effect on the business, earnings, assets,
liabilities, financial or other condition or results of operations of Company or
any Subsidiary that has or would be reasonably likely to have a Material Adverse
Effect and no fact or condition exists or is reasonably contemplated or
threatened which Company believes has a reasonable probability of resulting in
any change in or effect on the business, earnings, assets, liabilities,
financial or other condition, results of operations of Company or any Subsidiary
that has or could have a Material Adverse Effect. Without limiting the
generality of the foregoing, since November 30, 1996, and except as set forth on
Schedule 5.9, there has not been, occurred or arisen with respect to Company or
any Subsidiary any:

(a) any amendment of its charter or Bylaws (or equivalent
organizational documents);

(b) change in the number of shares of capital stock issued and
outstanding or issuance of any warrants, options or other securities
convertible or exercisable into shares of capital stock;

(c) declaration, setting aside, payment or distribution with
respect to, or any split, combination or reclassification of, shares of
capital stock declared or made by Company or any Subsidiary;

(d) increase in the compensation or severance pay payable or
to become payable by Company or any Subsidiary to any Personnel or any
increase of general applicability in the compensation or severance pay
payable to Personnel (in each case, other than pursuant to existing
corporate policies, practices and procedures described in Schedule
5.9(d) hereto and as in effect on the Balance Sheet Date), or employee
welfare, pension, retirement, profit-sharing or similar payment or
arrangement made or agreed to by Company or any Subsidiary for any
present or former Personnel (except pursuant to the existing plans and
arrangements described in Schedule 5.9(d) hereto and as in effect on
the Balance Sheet Date or as may be required by applicable law) ;

(e) significant labor trouble or any material controversy or
unsettled grievance pending or, to the best of Company's knowledge,
threatened between Company or any Subsidiary and any Personnel or a
collective bargaining organization representing or seeking to represent
Personnel;

(f) Encumbrance of any asset, tangible or intangible, except a
Permitted Lien (as defined in Section 5.11);

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(g) transfer, lease, guarantee, mortgage, pledge, disposal,
sale, assignment or transfer of any asset, tangible or intangible, or
any conducting of business, in each case, other than in the ordinary
course of business consistent with past practice;

(h) settlement or compromise of any material claims or
litigations or waiver, release or assignment of any material rights
with respect to the business of Company or any Subsidiary whether or
not in the ordinary course of business;

(i) cancellation, termination or entering into of, or material
modification to, any Contract (as defined in Section 5.14);

(j) material liability or loss incurred with respect to any of
the assets or the operations of the business of Company or any
Subsidiary, except liabilities incurred in the ordinary course of
business consistent with past practice;

(k) any capital expenditure or authorization of any capital
expenditure, acquisition of assets or execution of any lease, or any
incurring of liability therefor, requiring any payment or payments in
excess of $50,000 in the aggregate;

(l) borrowing or lending of money, issuing of debt securities
or pledging the credit of the business of Company or any Subsidiary or
guaranteeing of any indebtedness of others by Company or any Subsidiary
other than obligations under Section 3-415 of the Uniform Commercial
Code for indorsements of negotiable instruments in the ordinary course
of business consistent with past practice;

(m) failure to operate the business of Company or any
Subsidiary in the ordinary course so as to preserve the business of
Company or any Subsidiary intact, to keep available to Omnicare and its
affiliates the services of the Personnel, and to preserve for Omnicare
and its affiliates the goodwill of Company's and its Subsidiaries'
suppliers, customers and others having business relations with them;

(n) loss of service of any Personnel that is or are material,
individually or in the aggregate, to the conduct of the business of
Company or any Subsidiary;

(o) change in accounting practice of Company or any
Subsidiary, except as required by GAAP;

(p) material cancellations by any supplier, customer or
contractor;

(q) any material election with respect to Taxes; or

(r) any agreement, arrangement or understanding to do any of
the foregoing.

5.10. Legal Proceedings, etc. Except as disclosed on Schedule
5.10, there is neither (a) any civil, criminal, arbitral or administrative
action, suit, claim, hearing, investigation or proceeding pending or, to the
best of Company's knowledge, threatened against, relating to or affecting (i)
Company or any Subsidiary, (ii) Personnel in reference to actions taken by them
in such capacities or (iii) the transactions contemplated by this Agreement, nor
(b) any valid basis known to Company for any such litigation, proceeding or
investigation, which if adversely determined could have a Material Adverse
Effect or adversely affect the ability of Company to consummate the transactions
contemplated hereby. There are no judgements, decrees, injunctions, rules or
orders of any court or governmental department or agency outstanding against
Company or any Subsidiary.

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5.11. Title to Properties and Related Matters. (a) An asset
register of Company and its Subsidiaries as of a recent date along with a list
of all leases of real property and all other leased interests in real property
(the "Leasehold Interests") is set forth on Schedule 5.11 hereto. Company and
its Subsidiaries own no real property. The asset register identifies the
laboratory equipment, office equipment, furniture and fixtures, and leasehold
improvements (in the aggregate, the "Fixed Assets") of Company and its
Subsidiaries, which Fixed Assets constitute all material assets presently used
in the conduct of the business of Company and its Subsidiaries. Each of the
Company and its Subsidiaries, as the case may be, has good and marketable title
to the Leasehold Interests and Fixed Assets, free and clear of Encumbrances,
except for (i) the lien of current real and personal property taxes which are
not yet due and payable, (ii) such covenants, restrictions, encroachments,
easements and Encumbrances, if any, as do not materially detract from the value,
or materially interfere with the present occupancy or use, of any of the
Leasehold Interests or Fixed Assets or otherwise materially impair the
operations of the business of Company or any Subsidiary, (iii) encumbrances
specifically disclosed in the notes to the consolidated financial statements of
Company and its Subsidiaries for the years ended June 30, 1996 and 1995 and (iv)
the items set forth on Schedule 5.11 (collectively, "Permitted Liens"). Each of
Company and its Subsidiaries, as the case may be, possesses and quietly enjoys
all premises leased by it, and such premises are not subject to any
Encumbrances, including easements, rights-of-way, building use or occupancy
restrictions, exceptions, reservations or limitations that in any material
respect interfere with or impair the present and continued use thereof in the
usual and normal conduct of the business of Company or any Subsidiary. Neither
Company nor any Subsidiary has received notice of any pending or threatened
condemnation proceedings relating to Company's or any Subsidiary's leased
properties and, to the best knowledge of Company, there are no such pending or
threatened proceedings.

(b) Except as set forth on Schedule 5.11, the Fixed Assets
owned, operated or leased by Company or any Subsidiary are in good operating
condition and repair (ordinary wear and tear, excepted), and are in conformity
in all material respects with all applicable laws, ordinances, orders,
regulations and other requirements (including applicable zoning, environmental,
occupational safety and health laws and regulations) presently in effect or, to
the best of Company's knowledge, presently scheduled to take effect.

5.12. Employee Benefit Plans. (a) All employee profit-sharing,
incentive, deferred compensation, welfare, pension, retirement, group insurance,
bonus, severance and other employee benefit plans (oral or written) and
agreements maintained or contributed to by Company or any Subsidiary for the
benefit of current or former Personnel or with respect to which the Company or
any Subsidiary has liability, which constitutes an "employee benefit plan"
within the meaning of Section 3(3) of the Employee Retirement Income Security
Act of 1974, as amended ("ERISA") identifying which plans or arrangements (if
any) provide benefits after termination of employment ("Plans") are set forth on
Schedule 5.12(a).

(b) There are no current or former Personnel who are entitled
to (i) any pension benefit that is unfunded or (ii) any pension or other benefit
to be paid after termination of employment other than required by Section 4980B
of the Code (COBRA) or pursuant to plans intending to be qualified under Section
401(a) of the Code and listed on Schedule 5.12(a), and no other benefits
whatsoever are payable to any Personnel after termination of employment
(including retiree medical and death benefits).

(c) Each Plan that is an employee welfare benefit plan under
Section 3(1) of ERISA is either (i) funded through an insurance company contract
and is not a "welfare benefit fund" within the meaning of Section 419 of the
Code or (ii) is unfunded. There is no liability in the nature of a retroactive
rate adjustment or loss-sharing or similar arrangement, with respect to any Plan
which is an employee welfare benefit plan.

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(d) All contributions or payments owed with respect to any
periods prior to the Closing under any Plan have been made, or appropriate
charges, to the extent required, will be made on the Closing Date, and all other
amounts which relate to such periods have been accrued on the Company Financial
Statements. Each Plan by its terms and operation is in material compliance with
all applicable laws (including, but not limited to, ERISA, the Code and the Age
Discrimination in Employment Act of 1967, as amended).

(e) There are no actions, suits or claims pending or
threatened (other than routine noncontested claims for benefits) or, to the best
of Company's knowledge, no set of circumstances exist which may reasonably give
rise to such a claim against any Plan or administrator or fiduciary of any such
Plan. As to each Plan for which an annual report is required to be filed under
ERISA or the Code, all such filings, including schedules, have been made on a
timely basis except as disclosed on Schedule 5.12(e).

(f) Neither Company nor any Subsidiary (nor any entity that is
or was at any time treated as a single employer with Company or any Subsidiary
under Section 414(b), (c), (m) or (o) of the Code) has at any time (i)
maintained, contributed to or been required to contribute to any plan under
which more than one employer makes contributions (within the meaning of Section
4064(a) of ERISA) or any plan that is a multiemployer plan (within the meaning
of Section 3(37) of ERISA), (ii) incurred or expects to incur any liability to
the Pension Benefit Guaranty Corporation or otherwise under Title IV of ERISA or
(iii) incurred or expects to incur liability in connection with an "accumulated
funding deficiency" within the meaning of Section 412 of the Code whether or not
waived.

(g) Company has received a favorable determination letter from
the Internal Revenue Service, dated February 18, 1996, with respect to the
Coromed, Inc. 401(k) Employee Retirement Savings Plan (the "401(k) Plan") to the
effect that the 401(k) Plan is qualified under Sections 401(a) and 401(k) of the
Code and the related trust is exempt from tax under Section 501(a) and, to the
best of Company's knowledge, nothing has occurred since the date of such letter
to cause the letter to be no longer valid or effective.

(h) Neither Company nor any Subsidiary nor any other person,
including any fiduciary, has engaged in any "prohibited transaction" (as defined
in Section 4975 of the Code or Section 406 of ERISA), which could subject any of
the Plans (or their trusts), Company, any Subsidiary, or any person who Company
or any Subsidiary has an obligation to indemnify, to any tax or penalty imposed
under Section 4975 of the Code or Section 502 of ERISA.

(i) None of the assets of the Plans is invested in any
property constituting employer real property or an employer security within the
meaning of Section 407(d) of ERISA.

(j) Except as disclosed on Schedule 5.12(j), the events
contemplated by this Agreement, in and of themselves or together with a
termination of employment, will not (i) entitle any current or former Personnel
to severance pay, unemployment compensation, or other similar payments under any
Plan or law, (ii) accelerate the time of payment or vesting or increase the
amount of benefits due under any Plan or compensation to any current or former
Personnel, (iii) result in any payments (including parachute payments) under any
Plan or law becoming due to any current or former Personnel, or (iv) terminate
or modify or give a third party a right to terminate or modify the provisions or
terms of any Plan.

(k) Company has complied with the Worker Adjustment and
Retraining Notification Act.

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(l) The names and current annual rates of compensation of all
Personnel whose current aggregate annual rates of compensation are $50,000 or
more, together with a summary (containing estimates to the extent necessary) of
existing bonuses, additional incentive compensation (whether current or
deferred), if any, paid or payable to such persons as of November 30, 1996, are
set forth on Schedule 5.12(l).

(m) With respect to each Plan, the Company has delivered to
Omnicare true and complete copies of the following documents (1) current plan
documents, subsequent plan amendments, or any and all other documents that
establish or describe the existence of the plan, trust, arrangement, contract,
policy or commitment; (2) current summary plan descriptions and summaries of
material modifications; (3) the most recent tax qualified determination letters,
if any, received from or applications pending with the IRS; (4) the three most
recent Form 5500 Annual Reports, including related schedules and, if required,
audited financial statements and opinions of independent certified public
accountants and (5) with respect to each Section 401(k) Plan, nondiscrimination
testing results and the most recent annual and quarterly or monthly valuations.

5.13. Taxes and Tax Returns. (a) For purposes of this
Agreement, the term "Taxes" shall mean all taxes, charges, fees, levies or other
assessments, including, without limitation, income, gross receipts, employment,
excise, withholding, property, sales, use, transfer, license, payroll and
franchise taxes, together with any interest and any penalties, additions to tax
or additional amounts with respect thereto, imposed by the United States, or any
state, local or foreign government or subdivision or agency thereof. For
purposes of this Agreement, the term "Tax Return" shall mean any report, return
or other information required to be supplied to a taxing authority in connection
with Taxes. For purposes of this Agreement, the term "Code" shall mean the
Internal Revenue Code of 1986, as amended. All citations to provisions of the
Code, or to the Treasury Regulations promulgated thereunder, shall include any
amendments thereto and any substitute or successor provisions thereto.

(b) Company and its Subsidiaries have duly filed all Tax
Returns required to be filed as of the date hereof (and will file all Tax
Returns required to be filed on or before the Closing Date). All such Tax
Returns are (and, as to Tax Returns not filed as of the date hereof but filed on
or before the Closing Date, will be) true, correct and complete in all material
respects and were (and, as to Tax Returns not filed as of the date hereof but
filed on or before the Closing Date, will be) filed on a timely basis. Except as
disclosed in Schedule 5.13(b), neither Company nor any Subsidiary has requested
any extension of time within which to file any Tax Return, which Tax Return has
not since been filed. True and complete copies of the federal, state and local
income Tax Returns of Company and its Subsidiaries for the last three years have
been provided to Omnicare prior to the date hereof. The reserves for Taxes
reflected in the Company Financial Statements are sufficient for the payment of
all unpaid Taxes (whether or not currently disputed) which are incurred or may
be incurred with respect to the period (or portion thereof) ended on the date of
Company Financial Statements and for all years and periods ended prior thereto,
and the reserve for Taxes that will be reflected in the Final Balance Sheet will
be sufficient for the payment of all unpaid Taxes (whether or not currently
disputed) which are incurred or may be incurred with respect to the period (or
portion thereof) ended on the Closing Date and for all years and periods ended
prior thereto. Since the date of Company Financial Statements, neither Company
nor any Subsidiary has incurred any liability for Taxes other than in the
ordinary course of business, which Taxes would result in a material decrease in
the net worth of Company or its Subsidiaries. No waiver or extension of any
statute of limitations relating to Taxes has been given to, or requested by, the
Internal Revenue Service, or any state or local taxing authority. No claim is
currently being made by any authority in a jurisdiction where neither Company
nor any Subsidiary files Tax Returns that they are or may be subject to Taxes in
that jurisdiction.

(c) Except as set forth on Schedule 5.13(c), Company and its
Subsidiaries have complied (and until the Closing Date will comply) in all
material respects with the provisions of the Code relating to the withholding
and payment of Taxes, including, without limitation, the withholding

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and reporting requirements under Code sections 1441 through 1464, 3401 through
3406, and 6041 through 6049, as well as similar provisions under any other laws,
and have, within the time and in the manner prescribed by law, withheld from
employee wages and paid over to the proper governmental authorities all amounts
required. Company and each of its Subsidiaries have undertaken in good faith to
appropriately classify all service providers as either employees or independent
contractors for all Tax purposes.

(d) Neither the consolidated federal income Tax Returns nor
the state or local income Tax Returns of Company and its Subsidiaries have been
examined by the Internal Revenue Service or relevant state taxing authorities,
except as set forth on Schedule 5.13(d). All deficiencies asserted as a result
of the examinations referred to on Schedule 5.13(d) have been paid, and no issue
has been raised by any federal, state, local or foreign income tax authority in
any such examination which, by application of the same or similar principles to
similar transactions, could reasonably be expected to result in a proposed
deficiency for any subsequent period which could have a Material Adverse Effect.
Further, to the best of Company's knowledge, no state of facts exists or has
existed which would constitute grounds for the assessment of any material
liability for Taxes with respect to the periods which have not been audited by
the Internal Revenue Service or other taxing authority. Except as described on
Schedule 5.13(d), there are no examinations or other administrative or court
proceedings relating to Taxes in progress or pending nor has Company or any
Subsidiary received a revenue agent's report asserting a tax deficiency. To the
best of Company's knowledge, there are no threatened actions, suits,
proceedings, investigations or claims relating to or asserted for Taxes of
Company or any Subsidiary and there is no basis for any such claim.

(e) All material elections with respect to Taxes affecting
Company and its Subsidiaries as of the date hereof are set forth on Schedule
5.13(e).

(f) Neither Company nor any Subsidiary has received a Tax
Ruling (as defined below) or entered into a Closing Agreement (as defined below)
that would have any continuing effect after the Closing Date. "Tax Ruling" shall
mean a written ruling of a taxing authority relating to Taxes. "Closing
Agreement" shall mean a written and legally binding agreement with a taxing
authority relating to Taxes.

(g) Neither Company nor any Subsidiary is a party to a
contract or agreement that, individually or in the aggregate, or when taken
together with any payment that may be made under this Agreement or any
agreements contemplated hereby including, without limitation, the Employment
Agreements and Non-Competition Agreements, could give rise to the payment of any
"excess parachute payment" within the meaning of Section 280G of the Code.

(h) Except for the group of which Company is presently the
parent, Company has never been a member of an affiliated group of corporations,
within the meaning of section 1504 of the Code, and no Subsidiary has ever been
a member of an affiliated group of corporations, within the meaning of section
1504 of the Code, except where Company was the common parent corporation of such
affiliated group. Each Subsidiary has, since the date of its formation, been a
member (and, through the Closing Date, will continue to be a member) of an
affiliated group of corporations, within the meaning of section 1504 of the
Code, in which Company is the parent.

(i) Company is not, and has not been within the last five
years, a "United States real property holding corporation" within the meaning of
Section 897(c)(2) of the Code.

(j) None of the assets of Company or any Subsidiary is
property which is required to be treated as being owned by any other person
pursuant to the so-called "safe harbor lease" provisions of former section
168(f)(8) of the Code.

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(k) None of the assets of Company or any Subsidiary directly
or indirectly secures any debt the interest on which is tax exempt under section
103(a) of the Code.

(l) None of the assets of Company or any Subsidiary is "tax
exempt use property" within the meaning of Section 168(h) of the Code.

(m) Neither Company nor any Subsidiary has agreed to make, or
is required to make, any adjustment under section 481(a) of the Code by reason
of a change in accounting method or otherwise.

(n) Except as set forth on Schedule 5.13(n), neither Company
nor any Subsidiary is a party to any joint venture, partnership, or other
arrangement or contract that could be treated as a partnership for federal
income tax purposes.

(o) There are no liens with respect to Taxes (except for liens
with respect to real property taxes not yet due) upon any of the properties or
assets, real, personal or mixed, tangible or intangible, of Company or any
Subsidiary.

(p) Neither Company nor any Subsidiary has filed (or will file
prior to the Closing) a consent pursuant to Section 341(f) of the Code or has
agreed to have Section 341(f)(2) of the Code apply to any disposition of a
subsection (f) asset (as that term is defined in Section 341(f)(4) of the Code)
owned by Company or any Subsidiary.

(q) All transactions that could give rise to an understatement
of federal income tax (within the meaning of Section 6661 of the Code for Tax
Returns due (without regard to extensions) on or before December 31, 1989, and
within the meaning of Section 6662 of the Code for Tax Returns due (without
regard to extensions) after December 31, 1989) have been adequately disclosed
(or, with respect to Tax Returns not yet filed, will be adequately disclosed) on
the Tax Returns of Company and its Subsidiaries in accordance with Section
6661(b)(2)(B) of the Code for Tax Returns due (without regard to extensions) on
or prior to December 31, 1989, and in accordance with Section 6662(d)(2)(B) of
the Code for Tax Returns due (without regard to extensions) after December 31,
1989.

5.14. Agreements and Commitments. (a) Schedule 5.14 contains
an accurate list of all commitments, contracts, leases and agreements to which
Company or any Subsidiary is a party or by which any of them is bound which
involves a commitment or obligation in excess of $50,000 in the aggregate for
each such commitment, contract, lease or agreement or is otherwise material to
the business of Company or any Subsidiary (including, without limitation, joint
venture or partnership agreements, employment agreements, contracts, tenant
leases, equipment leases, equipment maintenance agreements, agreements with
municipalities and labor organizations, loan agreements, bonds, mortgages, liens
or other security agreements (the "Contracts"). Company has delivered true,
correct and complete copies of such agreements to Omnicare. Except as set forth
on Schedule 5.14, there are not:

(i) any contracts or commitments which involve a commitment or
obligation in excess of $50,000 in the aggregate for each such
contract or commitment which affect Company or any Subsidiary,
the assets or the operation thereof;

(ii) any contracts or commitments affecting ownership of,
title to, use of, or any interest in the real property of
Company or any Subsidiary;

(iii) any patent licensing agreements or any other agreements,
licenses or commitments with respect to patents, patent
applications, trademarks, trade names,

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service marks, technical assistance, copyrights or other like
terms affecting Company or any Subsidiary (other than computer
software licenses obtained in the ordinary course of
business);

(iv) any contracts, licenses or commitments which involve a
commitment or obligation in excess of $50,000 in the aggregate
for each such contract, license or commitment relating to data
processing programs, software or source codes utilized in
connection with the business of Company or any Subsidiary;

(v) any collective bargaining agreements or other contracts or
commitments to or with any labor unions or other employee
representatives or groups of employees;

(vi) any employment contracts or any other contracts,
agreements or commitments to or with individual employees or
agents of Company or any Subsidiary which involves a
commitment or obligation in excess of $50,000 in the aggregate
for each such contract, agreement or commitment and any
contracts, agreements or commitments with consultants or other
independent contractors;

(vii) any contracts or commitments providing for payments
based in any manner on the revenues or profits of Company or
any Subsidiary;

(viii) any contracts or commitments limiting the freedom of
Company or any Subsidiary to engage in any line of business or
operate in any geographic area, or to compete with any person
or entity;

(ix) any instruments relating to indebtedness for borrowed
money, including any note, bond, deed of trust, mortgage,
indenture or agreement to borrow money or any agreement of
guarantee or indemnification, whether written or oral, in
favor of any person or entity; or

(x) any other contract or commitment, whether in the ordinary
course of business or not, which involves future payments,
performance of services or delivery of goods or materials, to
or by Company or any Subsidiary of any amount or value in
excess of $50,000 in the aggregate for each such contract or
commitment.

(b) The Contracts constitute valid and legally binding
obligations of the parties thereto and are enforceable in accordance with their
terms, assuming due authorization, execution and delivery by parties other than
Company and its Subsidiaries and except (i) as may be affected by bankruptcy,
insolvency, reorganization, moratorium or similar laws or by equitable
principles relating to or limiting creditors rights generally and (ii) the
remedy of specific performance and injunctive and other forms of equitable
relief is subject to the discretion of the court before which any proceeding
therefor may be brought.

(c) Each Contract constitutes the entire agreement by and
between the respective parties thereto with respect to the subject matter
thereof.

(d) To the best of Company's knowledge, all obligations
required to be performed under the terms of the Contracts have been performed,
no act or omission has occurred or failed to occur which, with the giving of
notice, the lapse of time or both would constitute a default by Company or any
Subsidiary under the Contracts.

(e) Except as expressly set forth on Schedule 5.14(e), none of
the Contracts requires the consent of the other parties thereto in order for it
to be in full force and effect with

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respect to Company or a Subsidiary as controlled by Omnicare after the Closing
or would give rise to the other party's right to terminate any Contract as a
result of the Merger; and Company and its Subsidiaries will used their best
efforts to obtain any required consents prior to the Closing.

5.15. Employee Relations. Except as set forth on Schedule 5.15
(i) there are no pending claims by any current or former Personnel of Company or
any Subsidiary against Company or any Subsidiary other than for compensation and
benefits due in the ordinary course of employment; (ii) there are no pending
claims against Company or any Subsidiary arising out of any statute, ordinance
or regulation relating to employment practices or occupational or safety and
health standards; (iii) there are no pending or, to the best knowledge of
Company, threatened labor disputes, strikes or work stoppages against Company or
any Subsidiary; and (iv) to the best knowledge of Company, there are no union
organizing activities in process or contemplated with respect to the Company or
any Subsidiary. No collective bargaining units have been certified or recognized
by Company or any Subsidiary. Schedule 5.15 also identifies all employees on
leave of absence and all current or former employees and their dependents
receiving health benefits, or eligible to receive health benefits, as required
by COBRA. Notice of the availability of COBRA Coverage has been provided to all
persons entitled thereto since June 30, 1996, and all persons electing such
coverage are being (or have been, if applicable) provided such coverage.

5.16. Insurance. All policies of insurance in force with
respect to Company or any Subsidiary including policy numbers and names and
addresses of the issuers are set forth on Schedule 5.16 and are outstanding and
duly in force on the date hereof. Copies of all such policies of insurance have
been furnished to Omnicare. To the best knowledge of the Company, such policies,
taking into account the deductibles and exceptions set forth therein, insure in
all material respects against losses and risks that are typically covered by
insurance in accordance with customary industry practice in the industry in
which the Company and its Subsidiaries operate. Neither Company nor any
Subsidiary has received notice from any insurer or agent of such insurer that
substantial capital improvements or other expenditures will have to be made in
order to continue such insurance and, to the best knowledge of Company, no such
improvements or expenditures are required.

5.17. Intellectual Property. Each of Company and its
Subsidiaries, directly or indirectly, possesses or has adequate rights to all
licenses, permits and all other franchises, trademarks, trade names, service
marks, inventions, patents, copyrights, and any applications therefor, trade
secrets, research and development, know-how, technical data, computer software
programs or applications and technology systems necessary to operate their
respective businesses and required by applicable law (the "Intellectual
Property"). Except as set forth on Schedule 5.17, all right, title and interest
in and to each item of Intellectual Property is owned by Company or a
Subsidiary, is not subject to any license, royalty arrangement or pending or
threatened claim or dispute and is valid and in full force and effect. None of
the Intellectual Property owned or, to the best of Company's knowledge, none of
the Intellectual Property used by Company or any Subsidiary, infringes any
Intellectual Property right of any other entity and no Intellectual Property
owned by Company or any Subsidiary is infringed upon by any other entity.

5.18. Environmental Matters. Except as disclosed on Schedule
5.18:

(a) Each of Company and its Subsidiaries has been and is in
full compliance with all Environmental Laws (as defined below) applicable to the
operations of, and the property owned, operated, occupied or otherwise used by,
Company and its Subsidiaries. To the best knowledge of Company, there are no
circumstances that may prevent or interfere with such full compliance in the
future.

(b) Company and its Subsidiaries have obtained all Permits (as
defined below) necessary for the operation of their businesses and the
ownership, operation, occupation or other use

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of their properties, all such Permits are in good standing and Company and its
Subsidiaries are in compliance with all terms and conditions of such Permits.
There has been no material change in the facts or circumstances reported or
assumed in the applications for or the granting of such Permits.

(c) There is no lawsuit, claim, action, cause of action,
judicial or administrative proceeding, investigation, summons, or written notice
by any person pending, or to Company's knowledge, threatened, against Company or
any Subsidiary alleging potential liability (including, without limitation,
potential liability for investigatory costs, cleanup costs, governmental
response costs, natural resource damages, property damages, personal injuries or
penalties) arising out of or resulting from (i) the violation of any
Environmental Law or (ii) the presence or Release of any Hazardous Substance (as
defined below) at any location, whether or not owned, operated, occupied or
otherwise used by Company or any Subsidiary.

(d) Neither Company nor any Subsidiary is subject to any writ,
injunction, order, decree or settlement addressing (i) any alleged violation of
any Environmental Law or (ii) the alleged presence, or Release into the
environment, of any Hazardous Substance at any location, whether or not owned,
operated, occupied or otherwise used by Company or any Subsidiary.

(e) No Environmental Lien (as defined below) has attached to
any of the property owned, operated, occupied or otherwise used by Company or
any Subsidiary.

(f) There has been no Release of any Hazardous Substance at,
to or from any of the properties owned, operated, occupied or otherwise used by
Company or any Subsidiary.

(g) Neither Company nor any Subsidiary has transported or
arranged for the transport of any Hazardous Substance to any facility or site
for the purpose of treatment, storage, disposal or recycling which (i) is
included on the National Priorities List or the Comprehensive Environmental
Response, Compensation and Liability Information System under the Comprehensive
Environmental Response, Compensation and Liability Act, 42 U.S.C.
Sections 9601 et. seq. ("CERCLA"), or any similar state list which is required
by any state Environmental Law to be kept, or (ii) is presently subject to a
governmental enforcement action under CERCLA or the Solid Waste Disposal Act,
42 U.S.C. Sections 6901 et. seq., or any similar state Environmental Law.

(h) All of the third parties with which Company and its
Subsidiaries presently have arrangements, engagements or contracts to accept,
treat, transport, store, dispose, remove or recycle any Hazardous Substances
generated or present at any of the properties owned, operated, occupied or
otherwise used by Company or its Subsidiaries are properly permitted under
Environmental Laws to perform the foregoing activities or conduct.

(i) Neither Company nor any Subsidiary has any liability for
the violation of any Environmental Law or the Release of any Hazardous Substance
in connection with any business or property previously owned, operated, occupied
or otherwise used by Company or any Subsidiary or any of the predecessors of
Company or any Subsidiary.

(j) There are no past or present actions, activities,
circumstances, conditions, event or incidents, including, without limitation,
the generation, handling, transportation, treatment, storage, Release, presence,
disposal or arranging for disposal of any Hazardous Substance, that could form
the basis of any claim against Company or any Subsidiary under any Environmental
Law.

(k) Without in any way limiting the generality of the
foregoing, (i) all underground storage tanks, and the capacity and contents of
such tanks, located on the real property owned or operated by Company or any
Subsidiary are identified in Schedule 5.18, (ii) except as identified in
Schedule 5.18, there is no asbestos contained in or forming part of any
building, building

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component, structure or office space owned or operated by Company or any
Subsidiary, and (iii) no polychlorinated biphenyls (PCBs) are used or stored at
any part of the property owned or operated by Company or any Subsidiary.

(l) The following terms shall have the following meanings:

(i) "Environmental Laws" means all federal, state, local and
foreign laws, statutes, codes, ordinances, rules, regulations, orders,
directives, binding policies, common law, or Permits as amended and in
effect on the date hereof and on the Closing Date relating to or
addressing the environment, health or safety, including, but not
limited to, any law, statute, code, ordinance, rule, regulation, order,
directive, binding policy, common law or Permit relating to the
generation, use, handling, treatment, removal, storage, production,
manufacture, transportation, remediation, disposal, arranging for
disposal, or Release of Hazardous Substances.

(ii) "Environmental Lien" means a lien in favor of any
governmental authority for any (a) liability under any Environmental
Law or (b) damages arising from, or costs incurred by, such
governmental authority in response to a release or threatened release
of a Hazardous Substance into the environment.

(iii) "Hazardous Substances" means any toxic or hazardous
substances (including, without limitation, wastes), pollutants,
explosives, radioactive materials or substances (including, without
limitation, wastes), or Medical Waste (as defined below), including,
without limitation, asbestos, PCBs, petroleum products and byproducts,
and substances (including, without limitation, wastes) defined in or
regulated under Environmental Law.

(iv) "Medical Waste" means any substance, pollutant, material,
or contaminant listed or regulated under the Medical Waste Tracking Act
of 1988, 42 U.S.C. Section 6992, et seq. and implementing regulations
and similar applicable state law and regulations.

(v) "Permit" means any permit, license, consent or other
approval or authorization required under any Environmental Law.

(vi) "Release" means the release, spill, emission, leaking,
pumping, injection, deposit, disposal, discharge, dispersal, leaching or
migrating of any Hazardous Substance through or in the air, soil, surface water,
or groundwater.

5.19. No Conflict of Interest. Except as described on Schedule
5.19, no present or former officer or director, no affiliate of Company or any
Subsidiary and no Stockholder has (i) any interest in the property, real or
personal, tangible or intangible, including without limitation, Intangibles,
Licenses, inventions, technology, processes, designs, computer programs,
know-how and formulae used in or pertaining to the business of Company, or (ii)
any contract, commitment, arrangement or understanding, including, without
limitation, loan arrangement, with Company or any Subsidiary. To the best
knowledge of Company, no present officer or director of Company or any
Subsidiary, no affiliate thereof and no Stockholder, has any ownership or stock
interest in any other enterprise, firm, corporation, trust or any other entity
which is engaged in any line or lines of business which are the same as, or
similar to, or competitive with, the line or lines of business of Company. For
purposes of this representation, ownership of not more than three percent of the
voting stock of any publicly held company whose stock is listed on any
recognized securities exchange or traded over the counter shall be disregarded.

5.20. Accounts Receivable; Equipment. (a) All accounts
receivable of Company or any Subsidiary as of the Balance Sheet Date represent
transactions actually made in the ordinary

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course of business, represent monies due or goods sold and delivered or services
performed. Such accounts receivable are collectible, without setoff or similar
right, except to the extent of reserves on the Company Financial Statements,
which reserves are adequate. To the best knowledge of Company, such accounts
receivable are free and clear of any Encumbrance except as specifically
disclosed in the notes to the consolidated financial statements of Company and
its Subsidiaries for the years ended June 30, 1996 and 1995 or as set forth on
Schedule 5.20(a).

(b) The assets of Company and its Subsidiaries include, and as
of the Closing will include, all the equipment, inventory and other assets
presently used in the conduct of or related to the businesses of Company and its
Subsidiaries except those sold or otherwise consumed after the date hereof in
the ordinary course of business. All assets of Company and its Subsidiaries
consisting of equipment, whether reflected in the Company Financial Statements
or otherwise, are well maintained and in good operating condition, except for
reasonable wear and tear and except for items which have been written down in
the Company Financial Statements to a realizable market value or for which
adequate reserves have been provided in the Company Financial Statements. The
present quantity of all such equipment of Company and its Subsidiaries is
reasonable in the present course of the business conducted by Company and its
Subsidiaries. All of such equipment (except for leased equipment for which the
lessors have valid security interest) is free and clear of any Encumbrance
except as specifically disclosed in the notes to the consolidated financial
statements of Company and its Subsidiaries for the years ended June 30, 1996 and
1995 and as set forth on Schedule 5.20(b).

5.21. Independent Contractor Status. Schedule 5.21 sets forth
a complete list of all persons, including without limitation, all investigators
and monitors or clinical research associates and other study personnel, engaged
by Company or any Subsidiary at any time since June 30, 1995 to render
management, consulting, research, investigative or similar services to Company
or any Subsidiary as an independent contractor (collectively, the "Company
Contractors"). Company has provided to Omnicare true and complete copies of all
agreements entered into between Company or any Subsidiary and any Company
Contractor requested by Omnicare. To the best knowledge of the Company, each
Company Contractor is, and each person who at any prior time would have been
required to be included in a schedule listing the types of persons set forth on
Schedule 5.21 was, an independent contractor to, and not an employee of, Company
or the applicable Subsidiary for purposes of all applicable federal and state
income tax withholding requirements or otherwise.

5.22. Client Relations. Set forth on Schedule 5.22 is a list
of clients of Company and its Subsidiaries which accounted for 10% or more of
the net revenue of Company and its Subsidiaries, taken as a whole, for the
fiscal year ended June 30, 1996. None of the clients listed on Schedule 5.22 has
registered any material complaint regarding the services rendered by Company or
any Subsidiary, indicated any desire or intention to reduce the level of
services under any contract with Company or any Subsidiary, or stated verbally
or in writing any intention to terminate any contract with Company or any
Subsidiary.

5.23. Change in Control Payments. Except as set forth on
Schedule 5.23, neither Company nor any Subsidiary have any plans, programs,
commitments or arrangements to which they are parties, or to which they are
subject, pursuant to which payments may be required or acceleration of benefits
may be required upon change of control of Company.

5.24. Brokers and Finders. Other than WAH, whose fees are set
forth in the Engagement Letter, dated November 18, 1996, between Company and WAH
attached hereto as Exhibit 5.24 (the "WAH Engagement Letter"), Company and its
officers, directors or employees, and the Stockholders have not employed any
broker or finder or incurred any liability for any brokerage fees, commissions,
finders' fees or similar fees or expenses and no broker or finder has acted
directly or indirectly for Company or any Stockholder in connection with this
Agreement or the transactions contemplated hereby and no investment banking,
financial advisory or similar fees have been incurred

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or are or will be payable by Company or any Stockholder in connection with this
Agreement or the transactions contemplated hereby.

5.25. Omnicare Stock Ownership. Neither Company nor any
Subsidiary owns any shares of Omnicare Common Stock or other securities
convertible into Omnicare Common Stock.

5.26. Pooling of Interests. Neither Company nor any Subsidiary
nor any Stockholder has taken or failed to take any action or has knowledge of
any fact or circumstance that would, or would be reasonably likely to, prevent
the accounting for the Merger as a pooling of interests in accordance with GAAP
and the pronouncements of the Commission.

5.27. Tax Reorganization. Neither Company nor any Subsidiary
nor any Stockholder has taken or failed to take any action, or has knowledge of
any fact or circumstance, that would, or would be reasonably likely to,
adversely affect the status of the Merger as a reorganization under Section
368(a) of the Code.

ARTICLE 6

REPRESENTATIONS AND WARRANTIES OF THE STOCKHOLDERS

Except as disclosed by the Stockholders to Omnicare in writing
in the disclosure schedules being delivered to Omnicare by the Stockholders upon
or before the execution hereof (the "Stockholders Schedules") and which
Stockholder Schedules shall identify the specific Sections or subsections in
this Agreement to which each such disclosure relates, the Stockholders hereby
severally and not jointly with any other Stockholder represent and warrant to
Omnicare as follows:

6.1. Ownership; Authority. (a) Such Stockholder owns
beneficially and of record the number of shares set forth opposite his or her
name on Schedule 6.1, free and clear of all Encumbrances (other than as imposed
under this Agreement or the Support Agreement) and such Stockholder has the
authority to execute and deliver this Agreement, and no other acts or other
proceedings on the part of the Stockholders are necessary to authorize this
Agreement, the Support Agreement or the transactions contemplated hereby or
thereby, other than obtaining the requisite approval and adoption by the holders
of Company Common Stock in accordance with the DGCL and Company's Certificate of
Incorporation and Bylaws. This Agreement and the Support Agreement have been
duly and validly executed and delivered by such Stockholder and (assuming the
due authorization, execution and delivery by Company, Omnicare and Merger Sub,
in the case of this Agreement, and Omnicare and Merger Sub, in the case of the
Support Agreement) constitute the legal, valid and binding obligation of such
Stockholder, enforceable against each Stockholder in accordance with their
respective terms, except as enforcement thereof may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting the
enforcement of creditors' rights in general, or by general principles or equity.

(b) Neither the execution and delivery by such Stockholder of
this Agreement nor the Support Agreement nor the consummation of the
transactions contemplated hereby or thereby nor compliance by such Stockholder
with any of the provisions hereof or thereof will (i) violate or conflict with,
or result in a breach of any provision of, or constitute a default (or an event
which, with notice or lapse of time or both, would constitute a default) under,
or result in the termination of, or accelerate the performance required by, or
result in the creation of any Encumbrance upon any of the Company Common Stock
owned by such Stockholder under, any of the terms, conditions or provisions of
any note, bond, mortgage, indenture, deed of trust, license, lease, sublease,
option (other than options granted under the Company Stock Option Plan),
agreement or other instrument or obligation to which such Stockholder is a
party, or by which he or she or the Company Common Stock owned by such
Stockholder may be bound or affected, (ii) violate any order, writ, injunction,

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decree, statute, rule or regulation applicable to such Stockholder or the
Company Common Stock owned by such Stockholder or (iii) require any consent,
approval or authorization of, or notice to, or declaration, filing or
registration with, any person or entity applicable to such Stockholder except,
in the case of such clauses (i), (ii) and (iii), as would not be reasonably
likely to have a material adverse effect on such Stockholder's ability to
consummate the transactions contemplated hereby or by the Support Agreement.

6.2. Brokers or Finders. Such Stockholder has not entered into
and will not enter into any agreement, arrangement or understanding with any
broker, finder or investment banker pertaining to the Merger.

6.3. No Other Agreements to Sell Shares. Except as disclosed
on Schedule 6.3 and other than pursuant to this Agreement, no Stockholder has
any legal obligation, absolute or contingent, to any other person or firm to
sell any of the Company Common Stock or to enter into any agreement with respect
thereto.

6.4. Preemptive Rights. Except as disclosed on Schedule 6.4,
such Stockholder has no preemptive or other right to acquire shares of Company
Common Stock, except pursuant to options granted under the Company Stock Option
Plan.

ARTICLE 7

REPRESENTATIONS AND WARRANTIES OF
OMNICARE AND MERGER SUB

Except as disclosed by Omnicare and Merger Sub to Company and
the Stockholders in writing in the disclosure schedules being delivered to
Company and the Stockholders upon or before the execution hereof (the "Omnicare
Schedules") and which Omnicare Schedules shall identify the specific Sections or
subsections in this Agreement to which each such disclosure relates, Omnicare
and Merger Sub hereby jointly and severally represent and warrant to Company and
the Stockholders as follows:

7.1. Organization of Omnicare and its Subsidiaries. Each of
Omnicare and its subsidiaries is a corporation duly organized, validly existing
and in good standing under the laws of its jurisdiction of incorporation. Each
of Omnicare and its subsidiaries has full corporate power and authority to own,
lease and operate its properties and to carry on its business as now being
conducted therein, and each such entity is qualified to do business and is in
good standing in each jurisdiction (domestic, foreign or otherwise) in which
property owned, leased or operated by it or the nature of the business conducted
by it makes such qualification necessary (except for jurisdictions in which such
failure to be so qualified could not be reasonably likely to have a material
adverse effect on the business, earnings, assets, liabilities, financial or
other condition or results of operations of Omnicare and its subsidiaries taken
as a whole). Omnicare Schedule 7.1 contains a list of all jurisdictions where
either Omnicare or its subsidiaries are qualified to do business.

7.2. Authority. (a) The execution, delivery and performance of
this Agreement and the consummation of the transactions contemplated hereby by
Omnicare and Merger Sub have been duly authorized by all requisite corporate
action, and no other acts or other proceedings on the part of Omnicare or Merger
Sub are necessary to authorize this Agreement or the transactions contemplated
hereby. This Agreement has been duly and validly executed by Omnicare and Merger
Sub and (assuming the due authorization, execution and delivery hereof and
thereof by Company and the Stockholders) constitutes the legal, valid and
binding obligation of Omnicare and Merger Sub, enforceable against Omnicare and
Merger Sub in accordance with its terms, except as enforcement

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thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or
other similar laws affecting the enforcement of creditors' rights in general, or
by general principles of equity.

(b) Except as set forth in Omnicare Schedule 7.2(b), neither
the execution and delivery by Omnicare or Merger Sub of this Agreement nor the
consummation of the transactions contemplated hereby nor compliance with any of
the provisions hereof will (a) conflict with or result in a breach of any
provision of the charter or Bylaws of Omnicare or any of its subsidiaries, (b)
violate, conflict with, or result in a breach of any provision of, or constitute
a default (or an event which, with notice or lapse of time or both, would
constitute a default) under, or result in the termination or in a right of
termination or cancellation of, or accelerate the performance required by, or
result in the creation of any Encumbrance upon any of the properties of Omnicare
or any of its subsidiaries or result in being declared void, voidable, without
further binding effect or subject to amendment or modification any of the terms,
conditions or provision of, any note, bond, mortgage, indenture, deed of trust,
any license, franchise, permit, lease, contract, agreement or other instrument
or commitment or obligation to which Omnicare, any of its subsidiaries or any of
their respective properties may be bound or affected, (c) violate any order,
writ, injunction, decree, judgment, ruling, law, rule or regulation of any court
or governmental authority, federal, state or foreign, applicable to Omnicare or
any of its subsidiaries or any of their respective properties, or (d) except for
(i) applicable requirements of the HSR Act, (ii) obtaining the consents
approvals authorizations and permits of, and making filings or notifications to,
any governmental authority pursuant to the applicable requirements, if any, of
the Securities Act, the Exchange Act, Blue Sky Laws, the NASD and the NYSE and
(iii) the filing and recordation of the appropriate transaction documents as
required by the DGCL, require any consent, approval or authorization of, or
notice to, or declaration, filing or registration with, any person or entity
except, in the case of clauses (ii), (iii) and (iv) as would not be reasonably
likely to have a material adverse effect on the business, earnings, assets,
liabilities, financial or other condition or results of operations of Omnicare
and its subsidiaries taken as a whole or on the ability of Omnicare or Merger
Sub to consummate the transactions contemplated hereby.

7.3. Capitalization. As of September 30, 1996, the authorized,
issued and outstanding capital stock of Omnicare is as set forth in the
Quarterly Report of Omnicare on Form 10- Q for the nine months ended September
30, 1996. All of the outstanding shares of capital stock of Omnicare and Merger
Sub have been duly authorized and are validly issued, fully paid and
non-assessable and have not been issued in violation of the preemptive or
similar rights of any stockholder of Omnicare or Merger Sub arising by operation
of securities laws or the Certificate of Incorporation or Bylaws of Omnicare or
Merger Sub.

7.4. SEC Reports and Financial Statements. Omnicare has
furnished to Company copies of the Annual Report of Omnicare on Form 10-K for
the fiscal year ended December 31, 1995, any proxy statements and other reports
(including Quarterly Reports on Form 10-Q) under the Exchange Act, filed by
Omnicare after such date (collectively, the "SEC Reports"), each as filed with
the Securities and Exchange Commission (the "Commission"), and Omnicare's 1995
Annual Report to Stockholders (the "1995 Annual Report"). As of their respective
dates, each SEC Report and any proxy statements and other reports filed by
Omnicare with the Commission after the date of this Agreement (i) complied, or
will comply with on the date of such filing, as to form in all material respects
with the applicable requirements of the Securities Act and the Exchange Act, and
(ii) did not, or will not, on the date of filing or the date as of which
information is set forth therein, contain any untrue statement of a material
fact or omit to state a material fact required to be stated therein or necessary
to make the statements therein, in the light of the circumstances under which
they were made, not misleading. The representation in clause (ii) of the
immediately preceding sentence shall not apply to any misstatement or omission
in any SEC Report filed prior to the date hereof which was superseded by a
subsequent SEC Report filed prior to the date hereof. The financial statements
(including any related schedules and/or notes) included in the SEC Reports and
the 1995 Annual Report have been prepared in accordance with GAAP consistently
applied (except as may be indicated

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in the notes thereto) throughout the periods involved and fairly present the
financial position, results of operations and cash flows as of the dates and for
the periods indicated therein.

7.5. Absence of Undisclosed Liabilities. Except (i) as
disclosed in, or reflected in the financial statements included in, the SEC
Reports, (ii) liabilities which have been incurred since September 30, 1996 in
the ordinary course of business consistent with past practice as a result of
arm's length negotiations, which liabilities would not be reasonably likely to
have a material adverse effect on the business, earnings, assets, liabilities,
financial or other condition or results of operations of Omnicare and its
subsidiaries taken as a whole and (iii) liabilities and obligations specifically
disclosed on Omnicare Schedule 7.5, neither Omnicare nor any of its subsidiaries
has any material liabilities or obligations of any nature (whether accrued,
absolute, contingent or otherwise and whether due or to become due).

7.6. Omnicare Common Stock. The issuance and delivery by
Omnicare of shares of Omnicare Common Stock in connection with the Merger and
this Agreement have been duly and validly authorized by all necessary corporate
action on the part of Omnicare. The shares of Omnicare Common Stock to be issued
in connection with the Merger and this Agreement, when issued in accordance with
the terms of this Agreement, will be validly issued, fully paid and
nonassessable.

7.7. Pooling of Interests. Neither Omnicare nor any of its
subsidiaries has taken or failed to take any action or has knowledge of any fact
or circumstance that would, or would be reasonably likely to, prevent the
accounting for the Merger as a pooling of interests in accordance with GAAP and
the pronouncements of the Commission.

7.8. Tax Reorganization. Neither Omnicare nor any of its
subsidiaries has taken or failed to take any action, or has knowledge of any
fact or circumstance, that would, or would be reasonably likely to, adversely
affect the status of the Merger as a reorganization under Section 368(a) of the
Code.

7.9. Ownership of Merger Sub; No Prior Activities. Merger Sub
is a wholly owned subsidiary of Omnicare created solely for the purpose of
effecting the Merger. As of the date hereof and the Effective Time, except for
obligations or liabilities incurred in connection with its incorporation or
organization and the transactions contemplated by this Agreement and except for
this Agreement and any other agreements or arrangements contemplated by this
Agreement, Merger Sub has not and will not have incurred, directly or
indirectly, through any subsidiary or affiliate, any material obligations or
liabilities or engaged in any material business activities of any type or kind
whatsoever or entered into any agreements or arrangements with any person.

ARTICLE 8

COVENANTS

8.1. Alternative Proposals. Prior to the Effective Time,
Company agrees (a) that neither it nor any Subsidiary shall, and it shall direct
and use best efforts to cause its officers, directors, employees, agents and
representatives (including, without limitation, any investment banker, attorney
or accountant retained by it or any Subsidiary or any of the foregoing) not to
initiate, solicit or encourage, directly or indirectly, any inquiries or the
making or implementation of any proposal or offer (including, without
limitation, any proposal or offer to its stockholders) with respect to a
Alternative Proposal (as defined below) or engage in any negotiations
concerning, or provide any non-public information or data to, or have any
discussions with, any person relating to an Alternative Proposal, or otherwise
facilitate any effort or attempt to make or implement an Alternative Proposal;
(b) that it will immediately cease and cause to be terminated any existing
activities, discussions or negotiations with any parties conducted heretofore
with respect to any of the foregoing, and it will

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take the necessary steps to inform the individuals or entities referred to above
of the obligations undertaken in this Section 8.1; (c) that it will promptly
request each person which has executed a confidentiality agreement in connection
with its consideration of acquiring Company pursuant to the December 1996
Confidential Memorandum prepared by Company and WAH to return all confidential
information heretofore furnished to such person by or on behalf of Company and
(d) that it will notify Omnicare immediately if any such inquiries or proposals
are received by, any such information is requested from, or any such
negotiations or discussions are sought to be initiated or continued with, it;
provided, however, that nothing contained in this Section 8.1 shall prohibit the
Board of Directors of Company from (i) furnishing information (pursuant to a
confidentiality letter deemed appropriate by the Board of Directors of Company)
to or entering into discussions or negotiations with, any person or entity that
makes an unsolicited bona fide proposal or offer to the stockholders of Company,
to acquire Company pursuant to a merger, consolidation, share purchase, share
exchange, purchase of a substantial portion of assets, business combination or
other similar transaction, if, and only to the extent that, (A) the Board of
Directors of Company determines in good faith based upon the written opinion of
outside counsel that such action is required for the Board of Directors to
comply with its fiduciary duties to stockholders imposed by law, (B) prior to
furnishing such information to, or entering into discussions or negotiations
with, such person or entity, Company provides written notice to Omnicare of the
identity of the person or entity making the Alternative Proposal and that it
intends to furnish information to, or intends to enter into discussions or
negotiations with, such person or entity, and (C) Company keeps Omnicare
informed on a timely basis of the status of any such discussions or negotiations
and all terms and conditions thereof and promptly provides Omnicare with copies
of any written inquiries or proposals relating thereto, and (D) in the event
that the Board of Directors of Company determines to accept any such Alternative
Proposal (in accordance with subclause (A) above), Company provides Omnicare
with at least five business days' prior written notice thereof, during which
time Omnicare may make, and in such event, Company shall in good faith consider,
a counterproposal to such Alternative Proposal; and (ii) to the extent
applicable, complying with Rule 14e-2 promulgated under the Exchange Act with
regard to an Alternative Proposal. Nothing in this Section 8.1 shall (x) permit
Company to terminate this Agreement (except as specifically provided in Article
11 hereof), (y) permit Company to enter into any agreement with respect to an
Alternative Proposal during the term of this Agreement (it being agreed that
during the term of this Agreement, Company shall not enter into any agreement
with any person that provides for, or in any way facilitates, an Alternative
Proposal (other than a confidentiality agreement deemed appropriate by the Board
of Directors of Company)), or (z) affect any other obligation of Company under
this Agreement. "Alternative Proposal" shall mean any merger, acquisition,
consolidation, reorganization, share exchange, tender offer, exchange offer or
similar transaction involving Company or any Subsidiary, or any proposal or
offer to acquire in any manner, directly or indirectly, a substantial equity
interest in or a substantial portion of the assets of Company or any Subsidiary.

8.2. Interim Operations. Company shall, and shall cause its
Subsidiaries to, from the date hereof up to and including the Effective Time,
use reasonable best efforts to conduct their respective businesses only in the
ordinary course, consistent with past practice, and will not do, or cause to be
done, anything which is represented and warranted not to have been done in this
Agreement, except as otherwise expressly contemplated hereby. In addition,
Company will, and will cause its Subsidiaries to, from and after the date hereof
up to and including the Closing Date: (a) maintain in full force and effect the
insurance policies set forth on Schedule 5.16 (or policies providing
substantially the same coverage, copies of which will be made available to
Omnicare); (b) take such action as may reasonably be necessary to preserve the
assets and properties wherever located, which are material to the business of
Company and its Subsidiaries; (c) maintain their books and records in accordance
with accounting principles and in the manner consistent with past practices and
promptly advise Omnicare in writing of any material change in the business,
earnings, assets, liabilities, financial or other condition or results of
operations of Company or any Subsidiary; (d) maintain the assets of Company and
its Subsidiaries in the same state of repair, order and condition as on the date
hereof, reasonable wear and tear or loss by insured casualty excepted; (e)
maintain in

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full force and effect all material Licenses and perform in all material respects
all obligations under any Contracts; (f) not permit to occur any of those events
or occurrences described in Section 5.9 (Absence of Certain Changes) of this
Agreement which are subject to the control of Company and its Subsidiaries, and
will use its best efforts not to permit to occur any of those events or
occurrences described in Section 5.9 (Absence of Certain Changes) of this
Agreement which are not subject to the control of Company and its Subsidiaries,
except in each case as expressly permitted or provided by this Agreement; or (g)
not take any action that would prevent Company from consummating the
transactions contemplated by this Agreement. The parties hereto acknowledge and
agree that all outstanding options to acquire Company Common Stock shall be
treated in the Merger as provided in Article 4.

8.3. Meeting of Stockholders. Company will take all action
necessary in accordance with applicable law and its Certificate of Incorporation
and Bylaws to convene a meeting of its stockholders as promptly as practicable
to consider and vote upon the approval of this Agreement and the transactions
contemplated hereby. The Board of Directors of Company shall recommend such
approval and Company shall take all lawful action to solicit such approval,
including, without limitation, timely mailing the Proxy Statement/Prospectus (as
defined in Section 8.8); provided, however, that such recommendation or
solicitation is subject to any action (including any withdrawal or change of its
recommendation) taken by, or upon authority of, the Board of Directors of
Company in the exercise of its good faith judgment based upon the written
opinion of outside counsel as to its fiduciary duties to its stockholder imposed
by law.

8.4. Filings, Other Action. Subject to the terms and
conditions herein provided, Company and Omnicare shall: (a) promptly make their
respective filings and thereafter make any other required submissions under the
HSR Act with respect to the Merger; (b) use all reasonable efforts to cooperate
with one another in (i) determining which filings are required to be made prior
to the Effective Time with, and which consents, approvals, permits or
authorizations are required to be obtained prior to the Effective Time from,
governmental or regulatory authorities of the United States, the several states
and foreign jurisdictions in connection with the execution and delivery of this
Agreement and the consummation of the transactions contemplated hereby and (ii)
timely making all such filings and timely seeking all such consents, approvals,
permits or authorizations; and (c) use all reasonable efforts to take, or cause
to be taken, all other action and do, or cause to be done, all other things
necessary, proper or appropriate to consummate and make effective the
transactions contemplated by this Agreement.

8.5. Inspection of Records. From the date hereof to the
Effective Time, each of Company and Omnicare shall (i) allow all designated
officers, attorneys, accountants and other representatives of the other
reasonable access at all reasonable times to the offices, records and files,
correspondence, audits and properties, as well as to all information relating to
commitments, contracts, titles and financial position, or otherwise pertaining
to the business and affairs, of Company and Omnicare and their respective
subsidiaries, as the case may be, (ii) furnish to the other, the other's
counsel, financial advisors, auditors and other authorized representatives such
financial and operating data and other information as such persons may
reasonably request and (iii) instruct the employees, counsel and financial
advisors of Company or Omnicare, as the case may be, to cooperate with the other
in the other's investigation of the business of it and its subsidiaries.

8.6. Publicity. The initial press release relating to this
Agreement shall be a joint press release and thereafter Company and Omnicare
shall, subject to their respective legal obligations (including requirements of
stock exchanges and other similar regulatory bodies), consult with each other,
and use reasonable efforts to agree upon the text of any press release, before
issuing any such press release or otherwise making public statements with
respect to the transactions contemplated hereby and in making any filings with
any federal or state governmental or regulatory agency.

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8.7. Confidentiality Agreement. Notwithstanding the execution
of this Agreement, the confidentiality agreement, dated November 29, 1996,
between WAH and Omnicare (the "Confidentiality Agreement") shall remain in full
force and effect through the Effective Time, at which time the Confidentiality
Agreement shall terminate and be of no further force and effect. Each party
further acknowledges that the Confidentiality Agreement shall survive any
termination of this Agreement pursuant to Article 11 hereof. Company and its
representatives agree to maintain the confidentiality of the information
provided by Omnicare or its representatives pursuant to this Agreement in the
same manner and to the same extent that Omnicare is obligated to maintain the
confidentiality of information provided by Company or any of its representatives
pursuant to the Confidentiality Agreement.

8.8. Registration Statement. Omnicare and Company shall
cooperate and promptly prepare and Omnicare shall file with the Commission as
soon as practicable a Registration Statement on Form S-4 (the "Form S-4") under
the Securities Act, with respect to the Omnicare Common Stock issuable in the
Merger, a portion of which Registration Statement shall also serve as the proxy
statement with respect to the meeting of the stockholders of Company in
connection with the Merger (the "Proxy Statement/Prospectus"). The respective
parties will cause the Proxy Statement/Prospectus and the Form S-4 to comply as
to form in all material respects with the applicable provisions of the
Securities Act, the Exchange Act and the rules and regulations thereunder.
Omnicare shall use all reasonable efforts, and Company will cooperate with
Omnicare, to have the Form S-4 declared effective by the Commission as promptly
as practicable. Omnicare shall use its best efforts to obtain, prior to the
effective date of the Form S-4, all necessary state securities law or "Blue Sky"
permits or approvals required to carry out the transactions contemplated by this
Agreement and will pay all expenses incident thereto. Omnicare agrees that the
Form S-4 and each amendment or supplement thereto, at the time it is filed or
becomes effective, will not include an untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances under which they were
made, not misleading; provided, however, that the foregoing shall not apply to
the extent that any such untrue statement of a material fact or omission to
state a material fact was made by Omnicare in reliance upon and in conformity
with information concerning Company furnished to Omnicare or its agents by
Company or its agents for use in the Form S-4. Company agrees that the Proxy
Statement/Prospectus and each amendment or supplement thereto, at the time of
mailing thereof and at the time of the meeting of the stockholders of Company,
will not include an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading; provided, however, that the foregoing shall not apply to the extent
that any such untrue statement of a material fact or omission to state a
material fact was made by Company in reliance upon and in conformity with
information concerning Omnicare furnished to Company or its agents by Omnicare
or its agents for use in the Proxy Statement/Prospectus. Company agrees that the
information concerning Company provided by it for inclusion in the Form S-4 or
any amendment or supplement thereto, at the time it is filed or becomes
effective, will not include an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading. No amendment or supplement to the Proxy Statement/Prospectus
will be made by Omnicare or Company without the approval of the other party,
which approval shall not be unreasonably withheld. Omnicare and Company will
advise each other promptly after either party receives notice thereof, of the
time when the Form S-4 has become effective or any supplement or amendment has
been filed, the issuance of any stop order, the suspension of the qualification
of the Omnicare Common Stock issuable in connection with the Merger for offering
or sale in any jurisdiction, or any request by the Commission for amendment of
the Proxy Statement/Prospectus or the Form S-4 or comments thereon and responses
thereto or requests by the Commission for additional information.

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8.9. Listing Application. Omnicare shall promptly prepare and
submit to the NYSE a listing application covering the shares of Omnicare Common
Stock issuable in the Merger, and shall use its best efforts to obtain, prior to
the Effective Time, approval for the listing of such Omnicare Common Stock,
subject to official notice of issuance.

8.10. Further Action. Each party hereto shall, subject to the
fulfillment at or before the Effective Time of each of the conditions of
performance set forth herein or the waiver thereof, perform such further acts
and execute such documents as may be reasonably required to effect the Merger.

8.11. Affiliate Letters. (a) In the reasonable judgment of
Company, the Stockholders constitute all the "affiliates" of the Company (each
such person an "Affiliate") within the meaning of Rule 145 of the rules and
regulations promulgated under the Securities Act. At least 30 days prior to the
Closing Date, Company shall deliver to Omnicare a list of names and addresses of
any other persons who were, in Company's reasonable judgment, at the record date
for its stockholders' meeting to approve the Merger, Affiliates. Company shall
provide Omnicare such information and documents as Omnicare shall reasonably
request for purposes of reviewing such list. Company shall deliver or cause to
be delivered to Omnicare, prior to the Effective Time, from each of the
Affiliates of Company identified in the foregoing list, an Affiliate Letter in
the form attached hereto as Exhibit 8.11(a). Omnicare shall be entitled to place
legends as specified in such Affiliate Letters on the certificates evidencing
any Omnicare Common Stock to be received by such Affiliates pursuant to the
terms of this Agreement, and to issue appropriate stop transfer instructions to
the transfer agent for the Omnicare Common Stock, consistent with the terms of
such Affiliate Letters.

8.12. Taxes. Without the consent of Omnicare, Company shall
not, and shall cause its Subsidiaries not to, (i) make or rescind any express or
deemed election relating to Taxes, (ii) make a request for a Tax Ruling or enter
into a Closing Agreement with respect to any Tax matter or (iii) change any of
its methods of reporting income or deductions for federal income tax purposes
from those employed in the preparation of its federal income Tax Return for the
taxable year ending June 30, 1995, except as may be required by applicable law.

8.13. Expenses. All costs and expenses incurred in connection
with this Agreement and the transactions contemplated hereby shall be paid by
the party incurring such expenses; provided, however, that if the Merger is
consummated, the Surviving Corporation shall pay the reasonable fees and
expenses incurred by the Company and the Stockholders in connection with the
transactions contemplated hereby including (a) the reasonable fees and expenses
of Coopers & Lybrand LLC and of not more than one counsel for all such parties
(which counsel may be Morgan, Lewis & Bockius LLC), (b) the filing fee in
connection with the HSR Act filing, (c) the expenses incurred in connection with
printing and mailing the Form S-4 and the Proxy Statement/Prospectus and (d) the
fees of WAH provided in the WAH Engagement Letter; provided, that the maximum
amount to be paid by the Surviving Corporation pursuant to this Section 8.13
shall be no more than $1,100,000 in the aggregate.

8.14. Pooling; Reorganization. From and after the date hereof
and until the Effective Time, neither Omnicare nor Company nor any of their
respective subsidiaries or other affiliates nor any Stockholder shall (i)
knowingly take any action, or knowingly fail to take any action, that could
jeopardize the treatment of the Merger as a "pooling of interests" for
accounting purposes; (ii) knowingly take any action, or knowingly fail to take
any action, that could jeopardize qualification of the Merger as a
reorganization under Section 368(a) of the Code; or (iii) enter into any
contract, agreement, commitment or arrangement with respect to either of the
foregoing.

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8.15. Support Agreement. On or prior to the date of this
Agreement, Omnicare, Company and the Stockholders shall execute and deliver a
Support Agreement in substantially the form attached as Exhibit 8.15 hereto.

8.16. Company Office. The parties hereto agree that after
consummation of the Merger, Company will continue to be based in the greater
Albany, New York area.

8.17. Stock Purchase Plan. Company shall terminate the
Employee Stock Purchase Plan effective as of the end of the Offering Period (as
defined in the Plan) immediately preceding or coincident with the Effective
Time.

8.18. SEC Reports. Omnicare will use all reasonable efforts to
deliver copies of all SEC Reports to Company as promptly as practicable after
the filing of such SEC Reports with the Commission.

8.19. Release of Guarantees. The parties hereto shall take all
actions reasonably necessary to release the Stockholders and the other
individual guarantors identified on Schedule 8.19 from their guarantee
obligations with respect to those obligations of the Company or its Subsidiaries
set forth on Schedule 8.19.

8.20. Stockholder Tax Basis. The parties hereto will cooperate
with each other and will use all reasonable efforts to obtain prior to Closing
the tax basis of each stockholder of Company in shares of Company Common Stock.

8.21. Waiver of Rights. Company and each Stockholder hereby
waive any and all rights which any of them may have in connection with the
transactions contemplated by this Agreement pursuant to any Shareholders
Agreement entered into by the Company and any Stockholder.

8.22. Coromed, S.A. Each Stockholder owning shares of the
capital stock of Coromed, S.A. (Buenos Aires, Argentina) ("Coromed S.A.") shall,
prior to Closing, contribute all such capital stock to Company. Company and the
Stockholders shall use reasonable best efforts, in accordance with applicable
law, to cause each of the other persons or entities (other than Company) owning
shares of the capital stock of Coromed S.A. to contribute, prior to Closing, all
such capital stock to Company.

8.23. Loans. Company and the Stockholders will take all
actions reasonably necessary prior to Closing to cause each outstanding loan by
the Company to a Stockholder to be evidenced by written notes (copies of which
will be delivered to Omnicare prior to Closing) providing that (i) such loans
shall bear interest at a rate of 8.25% and (ii) all principal and interest on
such loans shall be due and payable on October 1, 1997.

ARTICLE 9

CONDITIONS

9.1. Conditions to Each Party's Obligation to Effect the
Merger. The respective obligation of each party to effect the Merger shall be
subject to the fulfillment at or prior to the Closing Date of the following
conditions:

(a) This Agreement and the transactions contemplated hereby
shall have been approved in the manner required by applicable law by
the holders of the issued and outstanding shares of capital stock of
Company.

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(b) The waiting period applicable to the consummation of the
Merger under the HSR Act shall have expired or been terminated.

(c) No party hereto shall be subject to any order or
injunction of a court of competent jurisdiction which prohibits the
consummation of the transactions contemplated by this Agreement. In the
event any such order or injunction shall have been issued, each party
agrees to use its reasonable efforts to have any such injunction
lifted.

(d) The Form S-4 shall have become effective and shall be
effective at the Effective Time, and no stop order suspending
effectiveness of the Form S-4 shall have been issued, no action, suit,
proceeding or investigation by the Commission to suspend the
effectiveness thereof shall have been initiated and be continuing, and
all necessary approvals under state securities laws relating to the
issuance or trading of the Omnicare Common Stock to be issued to
Company stockholders in connection with the Merger shall have been
received.

(e) All consents, authorizations, orders and approvals of (or
filings or registrations with) any governmental commission, board or
other regulatory body required in connection with the execution,
delivery and performance of this Agreement shall have been obtained or
made, except for filings in connection with the Merger and any other
documents required to be filed after the Effective Time and except
where the failure to have obtained or made any such consent,
authorization, order, approval, filing or registration would not have a
material adverse effect on the business, earnings, assets, liabilities,
financial or other condition or results of operations of Omnicare and
Company (and their respective subsidiaries), taken as a whole,
following the Effective Time.

(f) The Omnicare Common Stock to be issued to Company
stockholders in connection with the Merger shall have been approved for
listing on the NYSE, subject only to official notice of issuance.

(g) Company shall have received opinions of Morgan, Lewis &
Bockius, special counsel to Company, on the date of the Proxy
Statement/Prospectus and on the Closing Date, in each case dated as of
such respective dates and based upon reasonably requested
representation letters, stating that the Merger will be treated for
Federal income tax purposes as a reorganization within the meaning of
Section 368(a) of the Code, and that Company, Omnicare and Merger Sub
will each be a party to that reorganization within the meaning of
Section 368(b) of the Code.

9.2. Conditions to Obligation of Company and the Stockholders
to Effect the Merger. The obligation of Company and the Stockholders to effect
the Merger shall be subject to the fulfillment at or prior to the Closing Date
of the following conditions:

(a) Omnicare shall have performed in all material respects its
agreements contained in this Agreement required to be performed on or
prior to the Closing Date, the representations and warranties of
Omnicare and Merger Sub contained in this Agreement and in any document
delivered in connection herewith shall be true and correct as of the
Closing Date, and Company shall have received a certificate of the
President or a Vice President of Omnicare, dated the Closing Date,
certifying to such effect; provided, however, that notwithstanding
anything herein to the contrary, this Section 9.2(a) shall be deemed to
have been satisfied even if such representations or warranties are not
true and correct, unless the failure of any of the representations or
warranties to be so true and correct would or would be reasonably
likely to have a material adverse effect on the business, earnings,
assets,

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liabilities, financial or other condition or results of operations of
Omnicare and its Subsidiaries taken as a whole.

(b) Company shall have received from Coopers & Lybrand L.L.P.
a letter stating their concurrence with the conclusion of Company's
management that no conditions exist with respect to Company that would
preclude the Merger from being treated as a "pooling of interests"
under applicable United States accounting standards.

(c) Omnicare shall have entered into an employment agreement
with each Stockholder substantially in the form attached hereto as
Exhibit 9.2(c) (the "Employment Agreement").

9.3. Conditions to Obligation of Omnicare and Merger Sub to
Effect the Merger. The obligations of Omnicare and Merger Sub to effect the
Merger shall be subject to the fulfillment at or prior to the Closing Date of
the following conditions:

(a) Company shall have performed in all material respects its
agreements contained in this Agreement required to be performed on or
prior to the Closing Date, the representations and warranties of
Company contained in this Agreement and in any document delivered in
connection herewith shall be true and correct as of the Closing Date,
and Omnicare shall have received a certificate of the President or a
Vice President of Company, dated the Closing Date, certifying to such
effect; provided, however, that notwithstanding anything herein to the
contrary, this Section 9.3(a) shall be deemed to have been satisfied
even if such representations or warranties are not true and correct,
unless the failure of any of the representations or warranties to be so
true and correct would or would be reasonably likely to have a Material
Adverse Effect.

(b) Omnicare shall have received from Price Waterhouse LLP an
opinion that the Merger will be treated as a "pooling of interests"
under applicable accounting standards.

(c) From November 30, 1996 through the Effective Time, there
shall not have occurred any change in the business, earnings, assets,
liabilities, financial or other condition or results of operations of
Company and its Subsidiaries, taken as a whole, that could have a
Material Adverse Effect.

(d) Each of the Stockholders shall have entered into an
Employment Agreement with Omnicare and a non-competition agreement with
Omnicare substantially in the form attached hereto as Exhibit 9.3(d)
(the "Non-Competition Agreement"), each such agreement shall be in full
force and effect as of the Effective Time, and each Stockholder shall
be in the employ of Company immediately prior to the Effective Time.

(e) Dissenting stockholders of Company shall have taken
actions required to exercise appraisal rights pursuant to Section 262
of the DGCL with respect to no more than 5% of the outstanding shares
of Company Common Stock.

(f) Company shall have provided Omnicare with a certified
statement, pursuant to Section 1.1445-2(c)(3) of the Treasury
Regulations, that it is not, and has not been within the last five
years, a "United States real property holding corporation."

ARTICLE 10

NATURE AND SURVIVAL OF REPRESENTATIONS
AND WARRANTIES; INDEMNIFICATION, ETC.

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Section 10.1. Survival of Representations and Warranties;
Indemnities. (a) All covenants and agreements of the parties made in this
Agreement or provided herein shall survive the Closing Date to the extent
expressly provided herein. All representations and warranties of the parties
made in this Agreement or as provided herein shall be made as of the date hereof
and shall survive the Effective Time for a period ending at the earlier of (i)
one year from the Effective Time and (ii) the date upon which the first Annual
Report on Form 10-K reflecting the combined operations of Omnicare and Company
is filed with the Commission (the "Survival Period").

(b) The Stockholders, jointly and severally, hereby agree to
defend, indemnify and hold Omnicare and its subsidiaries and their officers,
directors and employees (collectively, the "Omnicare Indemnitees") harmless from
and against any and all claims, liabilities, losses, damages, deficiencies,
penalties, fines, costs or expenses (including, without limitation, the fees and
expenses of investigation and counsel) (collectively, "Losses"), arising out of
or resulting from (i) any breach of the representations and warranties contained
in Article 5; (ii) any breach in any material respect by the Stockholder or
Company of any covenant or agreement of the Stockholder or Company contained in
or arising out of this Agreement or (iii) any and all actions, suits,
proceedings, claims, demands, assessments and judgments incidental to the
foregoing to the enforcement of such indemnification; provided, that (A) the
Stockholders shall not be liable to the Omnicare Indemnitees for breach of the
representations and warranties set forth at Section 5.18(g), Section 5.18(h), or
Section 5.18(j) of this Agreement to the extent that such breach relates solely
to (i) the activities or conduct of any third party engaged by the Company to
accept, treat, transport, store, dispose, recycle or remove Hazardous Substances
(other than activities or conduct occurring at properties owned, operated,
occupied, or otherwise used (other than solely by such third party as agent for
the Company or such Subsidiary) by Company or any Subsidiary) or (ii) the
facilities or sites selected by any such persons for the treatment or disposal
of any Hazardous Substances (other than facilities or sites owned, operated,
occupied or otherwise used (other than solely by such third party as agent for
the Company or such Subsidiary) by the Company or any Subsidiary), unless and
until any and all of the Omnicare Indemnitee Losses (of any nature) on a
cumulative basis exceed $350,000 in the aggregate (in which case the
Stockholders shall only be liable for the amount of such Losses in excess of
$350,000); provided further, however, that this Section 10.1(b)(A) shall not
limit or condition in any way the Stockholders' liability under this Agreement
arising from or related to any violation of Environmental Laws by the Company or
any Subsidiary; and (B) the Stockholders shall not be liable to the Omnicare
Indemnitees for breach of any other representation or warranty contained in
Article 5 not covered by the immediately preceding clause (A) unless and until
any and all of the Omnicare Indemnitee Losses (of any nature) on a cumulative
basis exceed $200,000 in the aggregate (in which case the Stockholders shall
only be liable for the full amount of such Losses in excess of $200,000). Each
Stockholder, severally and not jointly, hereby agrees to defend, indemnify and
hold the Omnicare Indemnitees harmless from and against any and all Losses
arising out of or resulting from any breach of any representation or warranty by
such Stockholder contained in Article 6; provided; that such Stockholder shall
not be liable to the Omnicare Indemnitees for any such breach unless and until
the Losses of such Omnicare Indemnitees on a cumulative basis arising out of
such breach exceed $50,000 in the aggregate (in which case such Stockholder
shall only be liable for the full amount of such Losses in excess of $50,000).
Notwithstanding the foregoing, in no event shall the Stockholders' aggregate
liability pursuant to this Article 10 (over and above any threshold amounts
described above) exceed two million dollars.

(c) Promptly after the receipt by the Omnicare Indemnitees of
a notice of any claim, action, suit or proceeding of any third party which is
subject to indemnification hereunder, such party or parties (the "Indemnified
Party") shall give written notice of such claim (a "Notice of Claim") to the
party or parties obligated to provide indemnification hereunder (collectively,
the "Indemnifying Party"), stating the nature and basis of such claim and the
amount thereof, to the extent known. The failure of the Indemnified Party to so
notify the Indemnifying Party shall not impair the Indemnified Party's ability
to seek indemnification from the Indemnifying Party, except to the extent that
the

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Indemnifying Party is materially prejudiced. The Indemnifying Party shall be
entitled to participate in the defense or settlement of such matter and the
parties agree to cooperate in any such defense or settlement and to give each
other full access to all information relevant thereto. The Indemnifying Party
shall not be obligated to indemnify an Indemnified Party hereunder for any
settlement entered into without the Indemnifying Party's prior written consent,
which consent shall not be unreasonably withheld, conditioned or delayed. If any
Notice of Claim relates to a claim by a person or persons other than any
federal, state, local or foreign Tax authority, and the amount of such claim is
acknowledged by the Indemnifying Party to be fully covered by the foregoing
indemnity, as limited herein, the Indemnifying Party may elect to defend against
such claim at its own expense, in lieu of the Indemnified Party assuming such
defense; provided, that the Indemnified Party shall be entitled to participate
in or monitor such defense at its own expense and the Indemnifying Party will
fully cooperate with the Indemnified Party and its counsel with respect thereto.
If the Indemnifying Party elects to assume such defense, the Indemnifying Party
shall retain counsel reasonably satisfactory to the Indemnified Party. No
compromise or settlement of such claim may be effected by the Indemnifying Party
without the consent of the Indemnified Party (which shall not be unreasonably
withheld) unless (i) there is no finding or admission of any violation of law
and no effect on any other claims that may be made against such Indemnified
Party and (ii) the sole relief provided is monetary damages that are paid in
full by the Indemnifying Party. If a Notice of Claim relates to a claim by a
federal, state, local or foreign Tax authority and the Indemnifying Party
requests that the Indemnified Party accept a settlement offer (other than an
offer conditioned upon the Indemnified Party's agreement with respect to any
other issue not deemed a Loss hereunder) and agrees to pay the indemnity with
respect thereto, then the Indemnified Party shall either (i) accept such
settlement offer or (ii) not accept such settlement offer, in which case the
Indemnifying Party shall only be liable to the Indemnified Party for the amount
the Indemnifying Party would have been required to pay the Indemnified Party had
the Indemnified Party accepted the settlement offer.

(d) Notwithstanding any provision in this Article 10 to the
contrary, any claim for indemnification in respect of which notice is given in
accordance with the provisions of Section 10.1(a) hereof prior to the expiration
of the Survival Period shall survive with respect to such claim until final
resolution thereof.

ARTICLE 11

TERMINATION

11.1. Termination by Mutual Consent. This Agreement may be
terminated and the Merger may be abandoned at any time prior to the Effective
Time, before or after the approval of this Agreement by the stockholders of
Company, by the mutual consent of Omnicare and Company.

11.2. Termination by Either Omnicare or Company. This
Agreement may be terminated and the Merger may be abandoned by action of the
Board of Directors of either Omnicare or Company if (a) the Board of Directors
of Omnicare shall not have approved the Merger pursuant to this Agreement on or
before January 28, 1997, or (b) the Merger shall not have been consummated by
September 30, 1997, or (c) the approval of Company's stockholders required by
Section 9.1(a) shall not have been obtained at a meeting duly convened therefor
or at any adjournment thereof or (d) a United States federal or state court of
competent jurisdiction or United States federal or state governmental,
regulatory or administrative agency or commission shall have issued an order,
decree or ruling or taken any other action permanently restraining, enjoining or
otherwise prohibiting the transactions contemplated by this Agreement and such
order, decree, ruling or other action shall have become final and
non-appealable; provided, that the party seeking to terminate this Agreement
pursuant to this clause (d) shall have used all reasonable efforts to remove
such injunction, order or decree; and provided, in the case of a termination
pursuant to clause (a) above, that the terminating party shall not have breached
in any material respect its obligations under this Agreement in any

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manner that shall have proximately contributed to the failure to consummate the
Merger by the date specified in that clause.

11.3. Termination by Company. This Agreement may be terminated
and the Merger may be abandoned at any time prior to the Effective Time, if (a)
before the date on which approval by the stockholders of Company referred to in
Section 9.1(a) is obtained, by action of the Board of Directors of Company in
the exercise of its good faith judgment as to fiduciary duties to its
stockholders imposed by law, based upon the written opinion of outside counsel,
the Board of Directors of Company determines that such termination is required
by reason of an Alternative Proposal being made; provided, however, that Company
shall (i) notify Omnicare promptly of such receipt of such Alternative Proposal
and (ii) notify Omnicare promptly of its intention to recommend such Alternative
Proposal to Company stockholders, but in no event shall the notice referred to
in clause (ii) be given less than five business days prior to the earlier of the
public announcement of such recommendation or Company's termination of this
Agreement, (b) there has been a breach by Omnicare or Merger Sub of any
representation or warranty contained in this Agreement which would have or would
be reasonably likely to have a material adverse effect on the transactions
contemplated by this Agreement or on the business, earnings, assets,
liabilities, financial or other condition or results of operations of Omnicare,
or (c) there has been a material breach of any of the covenants or agreements
set forth in this Agreement on the part of Omnicare, which breach is not curable
or, if curable, is not cured within 30 days after written notice of such breach
is given by Company to Omnicare.

11.4. Termination by Omnicare. This Agreement may be
terminated and the Merger may be abandoned at any time prior to the Effective
Time by action of the Board of Directors of Omnicare, if (a) the Board of
Directors of Company shall have withdrawn or modified in a manner materially
adverse to Omnicare its approval or recommendation of this Agreement or the
Merger or shall have recommended an Alternative Proposal to Company
stockholders, or (b) there has been a breach by Company or the Stockholders of
any representation or warranty contained in this Agreement which would have or
would be reasonably likely to have a material adverse effect on the transactions
contemplated by this Agreement or a Material Adverse Effect, or (c) there has
been a material breach of any of the covenants or agreements set forth in this
Agreement on the part of Company or the Stockholders, which breach is not
curable or, if curable, is not cured within 30 days after written notice of such
breach is given by Omnicare to Company or the Stockholders, as the case may be.

11.5. Effect of Termination and Abandonment. (a) In the event
that any person or entity shall have made an Alternative Proposal more favorable
to the stockholders of Company than the Merger and thereafter this Agreement is
terminated pursuant to Sections 11.2(c), 11.3(a) or 11.4, then Company shall, on
the day of such termination, pay Omnicare a fee of $2,000,000, which amount
shall be payable by wire transfer of same day funds. Company acknowledges that
the agreement contained in this Section 11.5(a) is an integral part of the
transactions contemplated in this Agreement, and that, without this agreement,
Omnicare and Merger Sub would not enter into this Agreement.

(b) In the event of termination of this Agreement and the
abandonment of the Merger pursuant to this Article 11, all obligations of the
parties hereto shall terminate, except the obligations of the parties pursuant
to this Section 11.5 and Sections 8.7 and 8.13. Moreover, in the event of
termination of this Agreement pursuant to clauses (b) or (c) of Section 11.3 or
11.4 (other than termination pursuant to Section 11.4 which has resulted in
payment of the amount described in Section 11.5), nothing herein shall prejudice
the ability of the non-breaching party from seeking damages from any other party
for any breach of this Agreement, including without limitation, attorneys' fees
and the right to pursue any remedy at law or in equity.

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11.6. Extension, Waiver. At any time prior to the Effective
Time, any party hereto may, to the extent legally allowed, (a) extend the time
for the performance of any of the obligations or other acts of the other parties
hereto, (b) waive any inaccuracies in the representations and warranties made to
such party contained herein or in any document delivered pursuant hereto and (c)
waive compliance with any of the agreements or conditions for the benefit of
such party contained herein. Any agreement on the part of a party hereto to any
such extension or waiver shall be valid only if set forth in an instrument in
writing signed on behalf of such party.

ARTICLE 12

GENERAL PROVISIONS

12.1. Notices. Any notice required to be given hereunder shall
be sufficient if in writing, and sent by facsimile transmission and by courier
service (with proof of service), hand delivery or certified or registered mail
(return receipt requested and first-class postage prepaid), addressed as
follows:

If to Omnicare or Merger Sub: If to Company or the Stockholders:

Joel F. Gemunder Dr. Dale Evans, Ph.D.
President President and Chief Stockholder Officer
Omnicare, Inc. COROMED, Inc.
2800 Chemed Center Rensselaer Technology Park
255 East Fifth Street 185 Jordan Road
Cincinnati, Ohio 45202 Troy, New York 12180-8343
Facsimile: (513) 762-6905 Facsimile: (518) 283-1807

With copies to: With copies to:

Morton A. Pierce Stephen M. Goodman
Dewey Ballantine Morgan, Lewis & Bockius
1301 Avenue of the Americas 2000 One Logan Square
New York, New York 10019 Philadelphia, Pennsylvania 19103
Facsimile: (212) 259-6333 Facsimile: (215) 963-4663

or to such other address as any party shall specify by written notice so given,
and such notice shall be deemed to have been delivered as of the date so
telecommunicated, personally delivered or mailed.

12.2. Assignment; Binding Effect. Neither this Agreement nor
any of the rights, interests or obligations hereunder shall be assigned by any
of the parties hereto (whether by operation of law or otherwise) without the
prior written consent of the other parties. Subject to the preceding sentence,
this Agreement shall be binding upon and shall inure to the benefit of the
parties hereto and their respective successors and assigns. Notwithstanding
anything contained in this Agreement to the contrary, except for the provisions
of Article 10 nothing in this Agreement, expressed or implied, is intended to
confer on any person other than the parties hereto or their respective heirs,
successors, executors, administrators and assigns any rights, remedies,
obligations or liabilities under or by reason of this Agreement.

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12.3. Entire Agreement. This Agreement, the Exhibits, the
Company Schedules, the Stockholder Schedules, the Omnicare Schedules, the
Support Agreement and the Confidentiality Agreement and any documents delivered
by the parties in connection herewith constitute the entire agreement among the
parties with respect to the subject matter hereof and supersede all prior
agreements and understandings among the parties with respect thereto. No
addition to or modification of any provision of this Agreement shall be binding
upon any party hereto unless made in writing and signed by all parties hereto.

12.4. Amendment. This Agreement may be amended by the parties
hereto, by action for the corporate parties taken by their respective Boards of
Directors, at any time before or after approval of matters presented in
connection with the Merger by the stockholders of Company, but after any such
stockholder approval, no amendment shall be made which by law requires the
further approval of stockholders without obtaining such further approval. This
Agreement may not be amended except by an instrument in writing signed on behalf
of each of the parties hereto.

12.5. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware without regard to
its rules of conflict of laws.

12.6. Counterparts. This Agreement may be executed by the
parties hereto in separate counterparts, each of which when so executed and
delivered shall be an original, but all such counterparts shall together
constitute one and the same instrument. Each counterpart may consist of a number
of copies hereof each signed by less than all, but together signed by all of the
parties hereto.

12.7. Headings. Headings of the Articles and Sections of this
Agreement are for the convenience of the parties only, and shall be given no
substantive or interpretive effect whatsoever.

12.8. Interpretation. In this Agreement, unless the context
otherwise requires, words describing the singular number shall include the
plural and vice versa, and words denoting any gender shall include all genders
and words denoting natural persons shall include corporations and partnerships
and vice versa.

12.9. Waivers. Except as provided in this Agreement, no action
taken pursuant to this Agreement, including, without limitation, any
investigation by or on behalf of any party, shall be deemed to constitute a
waiver by the party taking such action of compliance with any representations,
warranties, covenants or agreements contained in this Agreement. The waiver by
any party hereto of a breach of any provision hereunder shall not operate or be
construed as a waiver of any prior or subsequent breach of the same or any other
provision hereunder.

12.10. Incorporation of Schedules and Exhibits. The Company
Disclosure Schedules, the Stockholder Schedules, the Omnicare Disclosure
Schedules and all other Schedules and Exhibits attached hereto and referred to
herein are hereby incorporated herein and made a part hereof for all purposes as
if fully set forth herein.

12.11. Severability. Any term or provision of this Agreement
which is invalid or unenforceable in any jurisdiction shall, as to that
jurisdiction, be ineffective to the extent of such invalidity or
unenforceability without rendering invalid or unenforceable the remaining terms
and provisions of this Agreement or affecting the validity or enforceability of
any of the terms or provisions of this Agreement in any other jurisdiction. If
any provision of this Agreement is so broad as to be unenforceable, the
provision shall be interpreted to be only so broad as is enforceable.

12.12. Enforcement of Agreement. The parties hereto agree that
irreparable damage would occur in the event that any of the provisions of this
Agreement was not performed in accordance with its specific terms or was
otherwise breached. It is accordingly agreed that the parties

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shall be entitled to an injunction or injunctions to prevent breaches of this
Agreement and to enforce specifically the terms and provisions hereof in any
Delaware Court, this being in addition to any other remedy to which they are
entitled at law or in equity.

12.13. Subsidiaries. As used in this Agreement, the word
"Subsidiary" or "Subsidiaries" means any corporation or other organization,
whether incorporated or unincorporated, of which Company directly or indirectly
owns or controls at least a majority of the securities or other interests having
by their terms ordinary voting power to elect a majority of the board of
directors or others performing similar functions with respect to such
corporation or other organization, or any organization of which Company is a
general partner.

12.14. Material Adverse Effect. As used in this Agreement, the
words "Material Adverse Effect" means any event, circumstance or set of facts
that has or is reasonably likely to have a material adverse effect on the
business, earnings, assets, liabilities, financial or other condition or results
of operations of Company and its Subsidiaries taken as a whole.

12.15. Knowledge. As used in this Agreement, the words
"knowledge of Company" or "best of Company's knowledge" or "known to Company" or
similar phrases shall mean the actual knowledge of the Stockholders and the
executive officers of Company and its Subsidiaries and the knowledge reasonably
imputed to such persons assuming prudent performance of their respective duties
as officers and directors of the Company.

A-39

<PAGE> 125
IN WITNESS WHEREOF, the parties have executed this Agreement
and caused the same to be duly delivered on their behalf on the day and year
first written above.

OMNICARE, INC. STOCKHOLDERS:

By:/s/ JOEL F. GEMUNDER By:/s/ DALE B. EVANS, Ph.D.
--------------------------------- ---------------------------------
Name: Joel F. Gemunder Dale B. Evans, PH.D.
Title: President

By:/s/ ALICE G. FEDORY
---------------------------------
COROMED ACQUISITION CORPORATION Alice G. Fedory

By:/s/ JOEL F. GEMUNDER By:/s/ THOMAS J. MASSEY
--------------------------------- ---------------------------------
Name: Joel F. Gemunder Thomas J. Massey
Title: President

By:/s/ RONALD E. WEISHAAR, Ph.D.
---------------------------------
COROMED, INC. Ronald E. Weishaar, PH.D.

By:/s/ DALE B. EVANS
---------------------------------
Name: Dale B. Evans
Title: President and Chief Executive Officer

A-40
<PAGE> 126
EXHIBIT A
TO MERGER
AGREEMENT

FORM OF AFFILIATE LETTER

Omnicare, Inc.
2800 Chemed Center
255 East Fifth Street
Cincinnati, Ohio 45202

Ladies and Gentlemen:

I have been advised that as of the date of this letter I may
be deemed to be an "affiliate" of COROMED, Inc., a Delaware corporation
("Company"), as the term "affiliate" is (i) defined for purposes of paragraphs
(c) and (d) of Rule 145 of the rules and regulations (the "Rules and
Regulations") of the Securities and Exchange Commission (the "Commission") under
the Securities Act of 1933, as amended (the "Act"), or (ii) used in and for
purposes of Accounting Series, Releases 130 and 135, as amended, of the
Commission. Pursuant to the terms of the Agreement and Plan of Merger dated as
of _____________, 1997 (the "Agreement"), by and among Omnicare, Inc., a
Delaware corporation ("Omnicare"), Coromed Acquisition Corporation, a Delaware
corporation and a wholly owned subsidiary of Omnicare ("Merger Sub"), Company
and the Stockholders who are signatories thereto, Merger Sub will be merged with
and into Company (the "Merger").

As a result of the Merger, I may receive shares of common
stock, par value $1.00 per share, of Omnicare (the "Omnicare Securities") in
exchange for shares owned by me of common stock, par value $.01 per share, of
Company.

I represent, warrant and covenant to Omnicare that in the
event I receive any Omnicare Securities as a result of the Merger:

A. I shall not make any sale, transfer or other disposition of
the Omnicare Securities in violation of the Act or the Rules and Regulations.

B. I have carefully read this letter and the Agreement and
discussed the requirements of such documents and other applicable limitations
upon my ability to sell, transfer or otherwise dispose of the Omnicare
Securities to the extent I felt necessary, with my counsel or counsel for
Company.

C. I have been advised that the issuance of Omnicare
Securities to me pursuant to the Merger has been registered with the Commission
under the Act on a Registration Statement on Form S-4. However, I have also been
advised that, since at the time the Merger was submitted for a vote of the
stockholders of Company, I may be deemed to have been an affiliate of Company
and the distribution by me of the Omnicare Securities has not been registered
under the Act, I may not sell, transfer or otherwise dispose of the Omnicare
Securities issued to me in the Merger unless (i) such sale, transfer or other
disposition has been registered under the Act, (ii) such sale, transfer or other
disposition is made in conformity with Rule 145 promulgated by the Commission
under the Act, or (iii) in the opinion of counsel reasonably acceptable to
Omnicare, or pursuant to a "no action" letter obtained by the undersigned from
the staff of the Commission, such sale, transfer or other disposition is
otherwise exempt from registration under the Act.

D. I understand that Omnicare is under no obligation to
register the sale, transfer or other disposition of the Omnicare Securities by
me or on my behalf under the Act or to take any

A-A-1

<PAGE> 127
other action necessary in order to make compliance with an exemption from such
registration available.

E. I also understand that stop transfer instructions will be
given to Omnicare's transfer agents with respect to the Omnicare Securities and
that there will be placed on the certificates for the Omnicare Securities issued
to me, or any substitutions therefor, a legend stating in substance:

"THE SHARES REPRESENTED BY THIS CERTIFICATE WERE ISSUED IN A
TRANSACTION TO WHICH RULE 145 PROMULGATED UNDER THE
SECURITIES ACT OF 1933 APPLIES. THE SHARES REPRESENTED BY
THIS CERTIFICATE MAY ONLY BE TRANSFERRED IN ACCORDANCE WITH
THE TERMS OF AN AGREEMENT DATED ____________, BETWEEN THE
REGISTERED HOLDER HEREOF AND OMNICARE, INC., A COPY OF WHICH
AGREEMENT IS ON FILE AT THE PRINCIPAL OFFICES OF OMNICARE,
INC."

F. I also understand that unless the transfer by me of my
Omnicare Securities has been registered under the Act or is a sale made in
conformity with the provisions of Rule 145, Omnicare reserves the right to put
the following legend on the certificates issued to my transferee:

"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 AND WERE ACQUIRED
FROM A PERSON WHO RECEIVED SUCH SHARES IN A TRANSACTION TO
WHICH RULE 145 PROMULGATED UNDER THE SECURITIES ACT OF 1933
APPLIES. THE SHARES HAVE BEEN ACQUIRED BY THE HOLDER NOT WITH
A VIEW TO, OR FOR RESALE IN CONNECTION WITH, ANY DISTRIBUTION
THEREOF WITHIN THE MEANING OF THE SECURITIES ACT OF 1933 AND
MAY NOT BE SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT IN
ACCORDANCE WITH AN EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT OF 1933."

It is understood and agreed that the legends set forth in
paragraphs E and F above shall be removed by delivery of substitute certificates
without such legend if such legend is not required for purposes of the Act or
this Agreement. It is understood and agreed that such legends and the stop
orders referred to above will be removed if (i) two years shall have elapsed
from the date the undersigned acquired the Omnicare Securities received in the
Merger and the provisions of Rule 145(d)(2) are then available to the
undersigned, (ii) three years shall have elapsed from the date the undersigned
acquired the Omnicare Securities received in the Merger and the provisions of
Rule 145(d)(3) are then available to the undersigned, or (iii) Omnicare has
received either an opinion of counsel, which opinion and counsel shall be
reasonably satisfactory to Omnicare, or a "no action" letter obtained by the
undersigned from the staff of the Commission, to the effect that the
restrictions imposed by Rule 145 under the Act no longer apply to the
undersigned.

I further represent to and covenant with Omnicare that I will
not sell, transfer or otherwise dispose of any Omnicare Securities received by
me in the Merger or any other shares of the capital stock of Omnicare until
after such time as financial results covering at least 30 days of combined
operations of Company and Omnicare have been published by Omnicare, in the form
of a quarterly earnings report, an effective registration statement registered
with the Commission, a report to the Commission on Form 10-K, 10-Q or 8-K, or
any other public filing or announcement which includes such combined results of
operations. Omnicare shall notify the "affiliates" of the publication of such
results. Notwithstanding the foregoing, I understand that I will not be
prohibited from selling up to 10% of the Omnicare Securities received by me in
the Merger during the aforementioned period.

A-A-2

<PAGE> 128
Execution of this letter should not be considered an admission
on my part that I am an "affiliate" of Company as described in the first
paragraph of this letter or as a waiver of any rights I may have to object to
any claim that I am such an affiliate on or after the date of this letter.

With a view to making available to me the benefits of Rule
145(d)(1) or any successor rule thereto, Omnicare agrees to use its reasonable
efforts to file with the Commission in a timely manner all reports required to
be filed by Omnicare under Sections 13 and 15(d) of the Exchange Act of 1934, as
amended (the "Exchange Act") for as long as the Omnicare Securities are
registered pursuant to Section 12 of the Exchange Act or until such earlier time
as any other rule or regulation of the Commission is available which permits me
to sell Omnicare Securities to the public without registration under the Act.

If, upon consummation of the Merger, the Omnicare Securities
which I receive pursuant to the Merger have not been registered under the Act,
Omnicare agrees to use its reasonable best efforts to file with the Commission,
as promptly as practicable, a Registration Statement on Form S-3 for an offering
to be made on a continuous basis pursuant to Rule 415 of the Act registering the
resale by me of such Omnicare Securities. Omnicare agrees to use its reasonable
best efforts to keep such Registration Statement effective under the Act until
the earlier of two years from the effective date of the Merger and the date on
which all such Omnicare Securities are sold. Notwithstanding the foregoing, the
Company may, at its discretion in good faith and for business reasons, suspend
use of such Registration Statement, in which case the two year period referenced
in the previous sentence shall be extended for the length of all such
suspensions. I will cooperate with Omnicare in connection with such registration
and will provide to Omnicare such information in connection therewith as it may
reasonably request.

Very truly yours,

---------------------------------
Name:

Agreed and Accepted this
day of , 1997

OMNICARE, INC.

By:
---------------------------------
Name:
Title:

A-A-3

<PAGE> 129
APPENDIX B

SUPPORT AGREEMENT

THIS SUPPORT AGREEMENT is made and entered into as of January
27, 1997, by and among Omnicare, Inc., a Delaware corporation ("Omnicare"),
COROMED, Inc., a Delaware corporation (the "Company") and Dale B. Evans, Ph.D.,
Alice G. Fedory, Thomas J. Massey and Ronald E. Weishaar, Ph.D., each being a
stockholder (each, a "Stockholder," and collectively, the "Stockholders") of the
Company.

WHEREAS, concurrently with the execution and delivery of this
Agreement, Omnicare, Coromed Acquisition Corporation, a Delaware corporation and
a wholly-owned subsidiary of Omnicare ("Merger Sub"), the Company and the
Stockholders are entering into an Agreement and Plan of Merger (the "Merger
Agreement"), providing for, among other things, the merger (the "Merger") of
Merger Sub with and into the Company, as a result of which the outstanding
shares of common stock, par value $.01 per share, of the Company (the "Company
Common Stock") will be converted into the right to receive shares of common
stock, par value $1.00 per share, of Omnicare (the "Omnicare Common Stock"), and
the Company will become a wholly-owned subsidiary of Omnicare;

WHEREAS, the Stockholders are collectively the owners
beneficially and of record of the number of shares of the Company Common Stock
set forth on Schedule A (collectively, the "Existing Shares," together with any
shares of Company Common Stock acquired after the date hereof, hereinafter
collectively referred to as the "Shares"); and

WHEREAS, as a condition to its willingness to enter into the
Merger Agreement, Omnicare has requested that the Stockholders agree, and the
Stockholders have agreed, to support the Merger as provided herein. All
capitalized terms used but not otherwise defined herein shall have the meanings
ascribed to them in the Merger Agreement.

NOW, THEREFORE, to induce Omnicare to enter into the Merger
Agreement and in consideration of the aforesaid and the mutual representations,
warranties, covenants and agreements set forth herein and in the Merger
Agreement, the parties hereto agree as follows:

1. Option. (a) Grant of Option. Subject to the terms of this
Section 1, each Stockholder hereby grants to Omnicare an irrevocable option (the
options granted by the Stockholders being collectively referred to herein as the
"Option") to purchase, in whole but not in part, at the election of Omnicare,
all of such Stockholder's Shares in exchange for the number of shares of
Omnicare Common Stock equal to the number of Shares to be purchased by Omnicare
multiplied by the Exchange Ratio (calculated using the date the Option is
exercised as the deemed date of the Effective Time for purposes of calculating
the Average Closing Price) (the "Purchase Price"). Each Stockholder may elect,
in his or her sole discretion, to cause Omnicare to pay all or a portion of the
Purchase Price in cash, with each share of Omnicare Common Stock that would have
been issued hereunder being deemed to have a value equal to the Average Closing
Price calculated as set forth above. If Omnicare elects to exercise the Option
with respect to one Stockholder, then Omnicare must elect to exercise the Option
with respect to all Stockholders.

(b) Closing. Subject to the terms and conditions of this
Agreement, if Omnicare elects to exercise the Option in accordance with Section
1(c) hereof, each Stockholder will, at the Closing (as defined in Section 1(c)),
sell, transfer, assign and deliver such Stockholder's Shares to Omnicare, and
Omnicare will acquire, accept, purchase and pay for such Stockholder's Shares.

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<PAGE> 130
(c) Exercise of Option. The Option may only be exercised by
Omnicare, in whole but not in part, following the occurrence of a Purchase Event
(as defined below); provided, that the Option shall terminate upon the earlier
of (i) the Effective Time, (ii) the termination of the Merger Agreement in
accordance with its terms (other than upon or during the continuance of a
Purchase Event) or (iii) one month following any termination of the Merger
Agreement upon or during the continuance of a Purchase Event (or, if, at the
expiration of such one month period the Option cannot be exercised by reason of
any applicable judgment, decree or order, 20 business days after such impediment
to exercise shall have been removed or shall become final and not subject to
appeal).

The term "Purchase Event" shall mean any of the following
events or transactions occurring after the date hereof: (i) Coromed shall have
entered into an agreement to engage in an Acquisition Transaction (as defined
below) or (ii) the Merger Agreement shall have been terminated by Omnicare or
the Company under circumstances which would entitle Omnicare to termination fees
under Section 11.5 of the Merger Agreement.

The Stockholders shall notify Omnicare promptly in writing of
the occurrence of any Acquisition Transaction; provided, however, that the
giving of such notice by the Stockholders shall not be a condition to the right
of Omnicare to exercise the Option.

In the event Omnicare wishes to exercise the Option, Omnicare
shall send a written notice (a "Closing Notice") to the Stockholders specifying
a place and time (the "Closing Date") between one and ten business days
inclusive from the date of the Closing Notice for the closing of such purchase
(the "Closing").

(d) Payment for Shares; Delivery of Shares. Subject to the
terms and conditions of this Agreement, in reliance on the representations,
warranties and covenants of each Stockholder contained herein and in full
payment for the Shares, at the Closing, Omnicare will deliver, or cause to be
delivered, to each Stockholder, certificates representing the shares of Omnicare
Common Stock to be paid pursuant to this Section 1 duly issued to each
Stockholder, together with any necessary stock transfer stamps properly affixed,
or, at the election of each Stockholder, cash in the amount of the Purchase
Price. At the Closing, each Stockholder will deliver, or cause to be delivered,
to Omnicare certificates representing such Stockholder's Shares duly endorsed to
Omnicare or accompanied by stock powers duly executed by such Stockholder in
blank, together with any necessary stock transfer stamps properly affixed.

(e) Adjustments. In the event of any change in the Company
Common Stock by reason of stock dividends, split-ups, mergers,
recapitalizations, combinations, conversions, exchanges of shares or the like,
(i) the number and kind of Shares subject to this Agreement and the purchase
price per Share pursuant to the Option shall be appropriately adjusted to
reflect changes made in the Company Common Stock so that Omnicare shall receive,
upon exercise of the Option and payment of the Purchase Price, the number and
class of shares, other securities, property or cash that Omnicare would have
received in respect of the Shares if the Option had been exercised and the
Shares had been issued to Omnicare immediately prior to such event or the record
date therefor, as applicable, and (ii) the term "Shares" shall be deemed to
refer to and include the Shares as well as all such stock dividends and
distributions and any securities into which or for which any or all of the
Shares may be changed or exchanged and such dividends, distributions and shares,
as the case may be, shall be paid to Omnicare at the Closing or promptly
following the receipt of such dividend or distribution, if the Closing
theretofore shall have occurred.

2. Agreement to Vote Shares. Each Stockholder agrees that,
during the period commencing on the date hereof and continuing until the
termination of the Option,, he or she will vote (or cause to be voted) all of
the Shares which such Stockholder is entitled to vote (or to provide his or her
written consent thereto) at any annual, special or other meeting of the
stockholders of the

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<PAGE> 131
Company, and at any adjournment or adjournments thereof, or by written consent
without a meeting with respect to all Shares as follows: (i) in favor of
approval and adoption of the Merger Agreement, the terms thereof and each of the
other transactions contemplated by the Merger Agreement; and (ii) against any
action or agreement other than the Merger Agreement or the transactions
contemplated thereby that would impede, interfere with, delay, postpone or
attempt to discourage the Merger, including without limitation: (a) any
extraordinary corporate transaction, such as a merger, acquisition,
consolidation, reorganization, share exchange, tender offer, exchange offer or
similar transaction involving the Company or any Subsidiary; or (b) a sale or
transfer, directly or indirectly, of a substantial equity interest in or a
substantial portion of the assets of the Company or any Subsidiary (each an
"Acquisition Transaction").

3. Agreement to Retain Shares. Each Stockholder hereby
covenants and agrees that during the period commencing on the date hereof and
continuing until the termination of the Option, such Stockholder will not, and
will not agree to, directly or indirectly, without the prior written consent of
Omnicare (i) sell, transfer, assign, pledge, hypothecate, cause to be redeemed
or otherwise dispose of any of the Shares beneficially owned by him or her; (ii)
grant any proxy or interest in or with respect to such Shares or deposit such
Shares into a voting trust or enter into a voting agreement or any arrangement
with respect to such Shares; or (iii) take any action that would make any
representation or warranty of the Stockholder contained herein untrue or
incorrect or have the effect of preventing or disabling the Stockholder from
performing his or her obligations under this Agreement. In addition, during the
period commencing on the date hereof and continuing until the termination of the
Option, each Stockholder covenants and agrees that such Stockholder will not
initiate or solicit, directly or indirectly, any inquiries or the making of any
proposal with respect to, or engage in negotiations concerning, provide any
confidential information or data to, or have any discussions with, any
individual, corporation, partnership or other person, entity or group relating
to, an Acquisition Transaction. The Stockholders further covenant and agree that
during the period commencing on the date hereof and continuing until the
termination of the Option, the Stockholders will collectively be the beneficial
and record owners of a majority of the outstanding shares of Company Common
Stock on a fully diluted basis (assuming all options to purchase shares of
Company Common Stock are exercised in full).

4. Representation and Warranties of the Stockholders. Each
Stockholder represents and warrants to Omnicare that (a) on the date hereof he
or she is the beneficial and record owner of the number of Existing Shares set
forth opposite his or her name on Schedule A hereto, which Existing Shares
collectively represent 60.33386% of all outstanding shares of Company Common
Stock 59.75196% of all outstanding shares of Company Common Stock on a fully
diluted basis assuming the exercise of all outstanding options); (b) such
Existing Shares are all of the securities of the Company owned of record or
beneficially by such Stockholder on the date hereof (other than shares
representing less than 1.0% of the outstanding shares of Company Common Stock
held jointly with a spouse); (c) each Stockholder has, and Omnicare will receive
at the Closing, good and marketable title to all of such Stockholder's Shares
free and clear of all claims, liens, pledges, options, charges, security
interests or other similar interests, encumbrances, judgments or imperfections
of title of any nature whatsoever (collectively, "Encumbrances") and with no
restriction on the voting rights pertaining thereto; (d) each Stockholder has
not granted any proxy with respect to Shares or deposited such Shares into a
voting trust; (e) each Stockholder is not a party to any agreement, contract,
commitment or understanding (other than this Agreement) which affects or relates
to the voting or giving of written consents with respect to the Shares or any
Stockholder's beneficial ownership of the Shares other than the Shareholders
Agreement referred to in Section 5 below; and (f) each Stockholder does not have
any rights to acquire additional shares of Company Common Stock except pursuant
to stock options granted under the Company Stock Option Plan.

5. Waiver of Rights. The Company and each Stockholder hereby
waive any and all rights which any of them may have in connection with the
transactions contemplated by this

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Agreement pursuant to any Shareholders Agreement entered into by the Company and
any Stockholder.

6. Legends. (i) Promptly after the execution of this
Agreement, and upon the acquisition of any additional Shares during the term of
this Agreement, each Stockholder agrees to cause the following legend to be set
forth on all certificates representing his or her Shares:

"THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO
CERTAIN RESTRICTIONS ON TRANSFER AND RIGHTS OF OMNICARE, INC.
AND COROMED ACQUISITION CORPORATION AS SET FORTH IN THAT
CERTAIN SUPPORT AGREEMENT, DATED AS OF JANUARY 27, 1997, A
COPY OF WHICH WILL BE PROVIDED TO THE HOLDER OF THIS
CERTIFICATE WITHOUT CHARGE UPON THE RECEIPT BY OMNICARE OF A
WRITTEN REQUEST THEREFOR, AND MAY NOT BE SOLD, TRANSFERRED,
ASSIGNED, PLEDGED, HYPOTHECATED, CAUSED TO BE REDEEMED OR
OTHERWISE DISPOSED OF OR ENCUMBERED EXCEPT IN COMPLIANCE WITH
SAID SUPPORT AGREEMENT."

(ii) Upon exercise of the Option, all certificates
representing shares of Company Common Stock issued to Omnicare shall be endorsed
with a legend to reflect the restrictions imposed by the Securities Act of 1933,
as amended (the "Securities Act").

(iii) Upon exercise of the Option, all certificates
representing shares of Omnicare Common Stock issued to such Stockholder, if any,
shall be endorsed with a legend to reflect the restrictions imposed by the
Securities Act.

7. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware without giving
effect to the provisions thereof relating to conflicts of law.

8. Binding Effect and Assignment. This Agreement shall be
binding upon, inure to the benefit of, and be enforceable by the successors and
permitted assigns of the parties hereto. This Agreement and the rights hereunder
may not be assigned or transferred by Omnicare, except that Omnicare may assign
its rights hereunder to any direct or indirect subsidiary.

9. Certain Events. Each Stockholder agrees that this Agreement
and the obligations hereunder shall attach to such Stockholder's Shares and
shall be binding upon any individual, corporation, partnership or other person,
entity or group to which legal or beneficial ownership of such Shares shall
pass, whether by operation of law or otherwise, including, without limitation,
such Stockholder's heirs, guardians, administrators or successors.
Notwithstanding any transfer of Shares, the transferor shall remain liable for
the performance of all obligations under this Agreement of the transferor.

10. Specific Performance; Injunctive Relief; Revocation of
Proxies. The parties acknowledge and agree that performance of their respective
obligations hereunder will confer a unique benefit on the other and that a
failure of performance will not be compensable by money damages. The parties
therefore agree that this Agreement shall be specifically enforceable and that
specific enforcement and injunctive relief shall be available to Omnicare and
the Stockholders for any breach of any agreement, covenant or representation
hereunder. This Agreement shall revoke all prior proxies given by each
Stockholder at any time with respect to the Shares.

11. Additional Documents. Each Stockholder will, upon request,
execute and deliver any additional documents and take such actions as may
reasonably be deemed by Omnicare to be necessary to complete the Agreement
granted herein or to carry out the provisions hereof.

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<PAGE> 133
12. Notices. Any notice required to be given hereunder shall
be sufficient if in writing, and sent by facsimile transmission and by courier
service (with proof of service), hand delivery or certified or registered mail
(return receipt requested and first-class postage prepaid), addressed as
follows:

If to Omnicare:

Joel F. Gemunder
President
Omnicare, Inc.
2800 Chemed Center
255 East Fifth Street
Cincinnati, Ohio 45202
Facsimile: (513) 762-6905

with a copy to:

Morton A. Pierce
Dewey Ballantine
1301 Avenue of the Americas
New York, New York 10019
Facsimile: (212) 259-6333

If to the Stockholders:

At the addresses set forth on
Schedule A hereto

with a copy to:

Stephen M. Goodman
Morgan, Lewis & Bockius
2000 One Logan Square
Philadelphia, Pennsylvania 19103
Facsimile: (215) 963-4663

13. Severability. If any term, provision, covenants, or
restriction of this Agreement is held by a court of competent jurisdiction to be
invalid, void or unenforceable, the remainder of the terms, provisions,
covenants and restrictions of this Agreement shall remain in full force and
effect and shall not in any way be affected, impaired or invalidated.

14. Counterparts. This Agreement may be executed in two or
more counterparts, each of which shall be deemed to be an original for all
purposes, but such counterparts taken together shall constitute one and the same
document.

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<PAGE> 134
IN WITNESS WHEREOF, Omnicare, the Company and the Stockholders
have caused this Agreement to be duly executed on the date first written above.

OMNICARE, INC.

By: /s/ JOEL F. GEMUNDER
-------------------------
Name: Joel F. Gemunder
Title: President

COROMED, INC.

By: /s/ DALE B. EVANS
---------------------------------
Name: Dale B. Evans
Title: President and Chief Executive Officer

THE STOCKHOLDERS:

By: /s/ DALE B. EVANS, Ph.D.
---------------------------------
Dale B. Evans, Ph.D.

By: /s/ ALICE G. FEDORY
---------------------------------
Alice G. Fedory

By: /s/ THOMAS J. MASSEY
---------------------------------
Thomas J. Massey

By: /s/ RONALD E. WEISHAAR, Ph.D.
---------------------------------
Ronald E. Weishaar, Ph.D.

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<PAGE> 135
SCHEDULE A

Name: Number of Shares
- ----- ----------------

Dale B. Evans, Ph.D. 127,885
16 Amity Pointe
Clifton Park, NY 12065

Alice G. Fedory 129,231
78 Manix Road
East Greenbush, NY 12061

Thomas J. Massey 115,681
50 Galmoral Court
Valatie, NY 12184

Ronald E. Weishaar, Ph.D. 11,000
6 Algonquin Road
Clifton Park, NY 12065

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<PAGE> 136
APPENDIX C

Section 262 of the
Delaware General Corporation Law

262 APPRAISAL RIGHTS.- (a) Any stockholder of a corporation of this
State who holds shares of stock on the date of the making of a demand pursuant
to subsection (d) of this section with respect to such shares, who continuously
holds such shares through the effective date of the merger or consolidation, who
has otherwise complied with subsection (d) of this section and who has neither
voted in favor of the merger or consolidation nor consented thereto in writing
pursuant to Section 228 of this title shall be entitled to an appraisal by the
Court of Chancery of the fair value of his shares of stock under the
circumstances described in subsections (b) and (c) of this section. As used in
this section, the word "stockholder" means a holder of record of stock in a
stock corporation and also a member of record of a nonstock corporation; the
words "stock" and "share" mean and include what is ordinarily meant by those
words and also membership or membership interest of a member of a nonstock
corporation; and the words "depository receipt" mean a receipt or other
instrument issued by a depository representing an interest in one or more
shares, or fractions thereof, solely of stock of a corporation, which stock is
deposited with the depository.

(b) Appraisal rights shall be available for the shares of any class or
series of stock of a constituent corporation in a merger or consolidation to be
effected pursuant to Section 251 (other than a merger effected pursuant to
subsection (g) of Section 251), 252, 254, 257, 258, 263 or 264 of this title:

(1) Provided, however, that no appraisal rights under this section
shall be available for the shares of any class or series of stock, which stock,
or depository receipts in respect thereof, at the record date fixed to determine
the stockholders entitled to receive notice of and to vote at the meeting of
stockholders to act upon the agreement of merger or consolidation, were either
(i) listed on a national securities exchange or designated as a national market
system security on an interdealer quotation system by the National Association
of Securities Dealers, Inc. or (ii) held of record by more than 2,000 holders;
and further provided that no appraisal rights shall be available for any shares
of stock of the constituent corporation surviving a merger if the merger did not
require for its approval the vote of the holders of the surviving corporation as
provided in subsection (f) of Section 251 of this title.

(2) Notwithstanding paragraph (1) of this subsection, appraisal rights
under this section shall be available for the

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shares of any class or series of stock of a constituent corporation if the
holders thereof are required by the terms of an agreement of merger or
consolidation pursuant to Sections 251, 252, 254, 257, 258, 263 and 264 of this
title to accept for such stock anything except:

a. Shares of stock of the corporation surviving or resulting from such
merger or consolidation, or depository receipts in respect thereof;

b. Shares of stock of any other corporation, or depository receipts in
respect thereof, which shares of stock or depository receipts at the effective
date of the merger or consolidation will be either listed on a national
securities exchange or designated as a national market system security on an
interdealer quotation system by the National Association of Securities Dealers,
Inc. or held of record by more than 2,000 holders;

c. Cash in lieu of fractional shares or fractional depository receipts
described in the foregoing subparagraphs a. and b. of this paragraph; or

d. Any combination of the shares of stock, depository receipts and cash
in lieu of fractional shares or fractional depository receipts described in the
foregoing subparagraphs a., b. and c. of this paragraph.

(3) In the event all of the stock of a subsidiary Delaware corporation
party to a merger effected under Section 253 of this title is not owned by the
parent corporation immediately prior to the merger, appraisal rights shall be
available for the shares of the subsidiary Delaware corporation.

(c) Any corporation may provide in its certificate of incorporation
that appraisal rights under this section shall be available for the shares of
any class or series of its stock as a result of an amendment to its certificate
of incorporation, any merger or consolidation in which the corporation is a
constituent corporation or the sale of all or substantially all of the assets of
the corporation. If the certificate of incorporation contains such a provision,
the procedures of this section, including those set forth in subsections (d) and
(e) of this section, shall apply as nearly as is practicable.

(d) Appraisal rights shall be perfected as follows:

(1) If a proposed merger or consolidation for which appraisal rights
are provided under this section is to be submitted for approval at a meeting of
stockholders, the corporation, not less than 20 days prior to the meeting, shall
notify each of its stockholders who was such on the record

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date for such meeting with respect to shares for which appraisal rights are
available pursuant to subsections (b) or (c) hereof that appraisal rights are
available for any or all of the shares of the constituent corporations, and
shall include in such notice a copy of this section. Each stockholder electing
to demand the appraisal of his shares shall deliver to the corporation, before
the taking of the vote on the merger or consolidation, a written demand for
appraisal of his shares. Such demand will be sufficient if it reasonably informs
the corporation of the identity of the stockholder and that the stockholder
intends thereby to demand the appraisal of his shares. A proxy or vote against
the merger or consolidation shall not constitute such a demand. A stockholder
electing to take such action must do so by a separate written demand as herein
provided. Within 10 days after the effective date of such merger or
consolidation, the surviving or resulting corporation shall notify each
stockholder of each constituent corporation who has complied with this
subsection and has not voted in favor of or consented to the merger or
consolidation of the date that the merger or consolidation has become effective;
or

(2) If the merger or consolidation was approved pursuant to Section
228 or Section 253 of this title, each constituent corporation, either before
the effective date of the merger or consolidation or within ten days thereafter,
shall notify each of the holders of any class or series of stock of such
constituent corporation who are entitled to appraisal rights of the approval of
the merger or consolidation and that appraisal rights are available for any or
all shares of such class or series of stock of such constituent corporation, and
shall include in such notice a copy of this section; provided that, if the
notice is given on or after the effective date of the merger or consolidation,
such notice shall be given by the surviving or resulting corporation to all such
holders of any class or series of stock of a constituent corporation that are
entitled to appraisal rights. Such notice may, and, if given on or after the
effective date of the merger or consolidation, shall, also notify such
stockholders of the effective date of the merger or consolidation. Any
stockholder entitled to appraisal rights may, within twenty days after the date
of mailing of such notice, demand in writing from the surviving or resulting
corporation the appraisal of such holder's shares. Such demand will be
sufficient if it reasonably informs the corporation of the identity of the
stockholder and that the stockholder intends thereby to demand the appraisal of
such holder's shares. If such notice did not notify stockholders of the
effective date of the merger or consolidation, either (i) each such constituent
corporation shall send a second notice before the effective date of the merger
or consolidation notifying each of the holders of any class or series of stock
of such constituent corporation that are entitled to appraisal rights of the
effective date of the

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merger or consolidation or (ii) the surviving or resulting corporation shall
send such a second notice to all such holders on or within 10 days after such
effective date; provided, however, that if such second notice is sent more than
20 days following the sending of the first such second notice need only be sent
to each stockholder who is entitled to appraisal rights and who has demanded
appraisal of such holder's shares in accordance with this subsection. An
affidavit of the secretary or assistant secretary or of the transfer agent of
the corporation that is required to give either notice that such notice has been
given shall, in the absence of fraud, be prima facie evidence of the facts
stated therein. For purposes of determining the stockholders entitled to receive
either notice, each constituent corporation may fix, in advance, a record date
that shall be not more than 10 days prior to the date the notice is given;
provided that, if the notice is given on or after the effective date of the
merger or consolidation, the record date shall be such effective date. If no
record date is fixed and the notice is given prior to the effective date, the
record date shall be the close of business on the day next preceding the day on
which the notice is given.

(e) Within 120 days after the effective date of the merger or
consolidation, the surviving or resulting corporation or any stockholder who has
complied with subsections (a) and (d) hereof and who is otherwise entitled to
appraisal rights, may file a petition in the Court of Chancery demanding a
determination of the value of the stock of all such stockholders.
Notwithstanding the foregoing, at any time within 60 days after the effective
date of the merger or consolidation, any stockholder shall have the right to
withdraw his demand for appraisal and to accept the terms offered upon the
merger or consolidation. Within 120 days after the effective date of the merger
or consolidation, any stockholder who has complied with the requirements of
subsections (a) and (d) hereof, upon written request, shall be entitled to
receive from the corporation surviving the merger or resulting from the
consolidation a statement setting forth the aggregate number of shares not voted
in favor of the merger or consolidation and with respect to which demands for
appraisal have been received and the aggregate number of holders of such shares.
Such written statement shall be mailed to the stockholder within 10 days after
his written request for such a statement is received by the surviving or
resulting corporation or within 10 days after expiration of the period for
delivery of demands for appraisal under subsection (d) hereof, whichever is
later.

(f) Upon the filing of any such petition by a stockholder, service of a
copy thereof shall be made upon the surviving or resulting corporation, which
shall within 20 days after such service file in the office of the Register in

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Chancery in which the petition was filed a duly verified list containing the
names and addresses of all stockholders who have demanded payment for their
shares and with whom agreements as to the value of their shares have not been
reached by the surviving or resulting corporation. If the petition shall be
filed by the surviving or resulting corporation, the petition shall be
accompanied by such a duly verified list. The Register in Chancery, if so
ordered by the Court, shall give notice of the time and place fixed for the
hearing of such petition by registered or certified mail to the surviving or
resulting corporation and to the stockholders shown on the list at the addresses
therein stated. Such notice shall also be given by 1 or more publications at
least 1 week before the day of the hearing, in a newspaper of general
circulation published in the City of Wilmington, Delaware or such publication as
the Court deems advisable. The forms of the notices by mail and by publication
shall be approved by the Court, and the costs thereof shall be home the
surviving or resulting corporation.

(g) At the hearing on such petition, the Court shall determine the
stockholders who have complied with this section and who have become entitled to
appraisal rights. The Court may require the stockholders who have demanded an
appraisal for their shares and who hold stock represented by certificates to
submit their certificates of stock to the Register in Chancery for notation
thereon of the pendency of the appraisal proceedings; and if any stockholder
fails to comply with such direction, the Court may dismiss the proceedings as to
such stockholder.

(h) After determining the stockholders entitled to an appraisal, the
Court shall appraise the shares, determining their fair value exclusive of any
element of value arising from the accomplishment or expectation of the merger or
consolidation, together with a fair rate of interest, if any, to be paid upon
the amount determined to be the fair value. In determining such fair value, the
Court shall take into account all relevant factors. In determining the fair rate
of interest, the Court may consider all relevant factors, including the rate of
interest which the surviving or resulting corporation would have had to pay to
borrow money during the pendency of the proceeding. Upon application by the
surviving or resulting corporation or by any stockholder entitled to participate
in the appraisal proceeding, the Court may, in its discretion, permit discovery
or other pretrial proceedings and may proceed to trial upon the appraisal prior
to the final determination of the stockholder entitled to an appraisal. Any
stockholder whose name appears on the list filed by the surviving or resulting
corporation pursuant to subsection (f) of this section and who has submitted his
certificates of stock to the Register in Chancery, if such is required, may
participate fully in all proceedings until it is

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finally determined that he is not entitled to appraisal rights under this
section.

(i) The Court shall direct the payment of the fair value of the shares,
together with interest, if any, by the surviving or resulting corporation to the
stockholders entitled thereto. Interest may be simple or compound, as the Court
may direct. Payment shall be so made to each such stockholder, in the case of
holders of uncertificated stock forthwith, and the case of holders of shares
represented by certificates upon the surrender to the corporation of the
certificates representing such stock. The Court's decree may be enforced as
other decrees in the Court of Chancery may be enforced, whether such surviving
or resulting corporation be a corporation of this State or of any state.

(j) The costs of the proceeding may be determined by the Court and
taxed upon the parties as the Court deems equitable in the circumstances. Upon
application of a stockholder, the Court may order all or a portion of the
expenses incurred by any stockholder in connection with the appraisal
proceeding, including, without limitation, reasonable attorney's fees and the
fees and expenses of experts, to be charged pro rata against the value of all
the shares entitled to an appraisal.

(k) From and after the effective date of the merger or consolidation,
no stockholder who has demanded his appraisal rights as provided in subsection
(d) of this section shall be entitled to vote such stock for any purpose or to
receive payment of dividends or other distributions on the stock (except
dividends or other distributions payable to stockholders of record at a date
which is prior to the effective date of the merger or consolidation); provided,
however, that if no petition for an appraisal shall be filed within the time
provided in subsection (e) of this section, or if such stockholder shall deliver
to the surviving or resulting corporation a written withdrawal of his demand for
an appraisal and an acceptance of the merger or consolidation, either within 60
days after the effective date of the merger or consolidation as provided in
subsection (e) of this section or thereafter with the written approval of the
corporation, then the right of such stockholder to an appraisal shall cease.
Notwithstanding the foregoing, no appraisal proceeding in the Court of Chancery
shall be dismissed as to any stockholder without the approval of the Court, and
such approval may be conditioned upon such terms as the Court deems just.

(1) The shares of the surviving or resulting corporation to which the
shares of such objecting stockholders would have been converted had they
assented to the merger or consolidation shall have the status of authorized and
unissued

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shares of the surviving resulting corporation.

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APPENDIX D

WESSELS, ARNOLD & HENDERSON, L.L.C.

February 19, 1997

The Board of Directors
COROMED, Inc.
Rensselear Technology Park
185 Jordan Road
Troy, NY 12180

Ladies and Gentlemen:

You have requested us to render an opinion as to the fairness, from a financial
point of view, to the stockholders of COROMED, Inc. ("COROMED" or the
"Company"), of the consideration to be received by COROMED's stockholders in the
proposed merger of COROMED (the "Merger") with COROMED Acquisition Corporation,
a wholly owned subsidiary of Omnicare, Inc. ("Omnicare"), pursuant to the terms
of the Agreement and Plan of Merger dated January 27, 1997 by and among COROMED,
COROMED Acquisition Corporation and Omnicare ("the Agreement"). Capitalized
terms used herein shall have the meaning used in the Agreement unless otherwise
defined herein.

Pursuant to the Agreement, Omnicare will acquire all of the outstanding stock of
COROMED in exchange for shares of Omnicare Common Stock having an aggregate
value of $40,000,000, as determined in accordance with, and subject to the
adjustments contemplated by, the exchange ratio formula set forth in Section 4.2
of the Agreement. Following the Merger, COROMED will be a wholly owned
subsidiary of Omnicare.

Wessels, Arnold & Henderson, L.L.C. ("Wessels, Arnold & Henderson"), as part of
its investment banking services, is regularly engaged in the valuation of
businesses and their securities in connection with mergers and acquisitions,
corporate restructurings, negotiated underwritings, secondary distributions of
listed and unlisted securities, private placements and valuations for corporate
and other purposes. We have acted as financial advisor to the COROMED Board of
Directors in connection with the Merger and will receive fees for our services,
including the rendering of this opinion.

In connection with our review of the Merger, and in arriving at our opinion, we
have: (i) reviewed and analyzed the financial terms of the Agreement; (ii)
reviewed and analyzed certain publicly available financial statements and other
information of Omnicare; (iii) reviewed and analyzed certain internal financial
statements and other financial and operating data concerning the Company
prepared by the management of the Company; (iv) reviewed and analyzed certain
financial projections concerning the Company prepared by the management of the
Company; (v) reviewed and analyzed certain financial projections concerning
Omnicare prepared by institutional equity research analysts; (vi) conducted

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The Board of Directors, COROMED, Inc.
February 19, 1997
Page 2

discussions with members of the senior management of the Company with respect to
the business and prospects of the Company; (vii) reviewed the historical and
projected financial performance and market valuations of certain comparable,
publicly traded companies; and (viii) reviewed the financial terms, to the
extent publicly available, of certain comparable transactions. In addition, we
have conducted such other analyses and examinations and considered such other
financial, economic and market criteria as we have deemed necessary in arriving
at our opinion.

In rendering our opinion, we have assumed and relied upon the accuracy and
completeness of the financial, legal, tax and other information provided to us
by the Company and Omnicare, and have not independently verified such
information. We have not performed an independent evaluation or appraisal of any
of the respective assets or liabilities of the Company or Omnicare and we have
not been furnished with any such valuations or appraisals. With respect to the
Company's financial forecasts, we have assumed that they have been reasonably
prepared on the bases reflecting the best currently available estimates and
judgments of the management of the Company as to the future financial
performance of the Company. With respect to the financial forecasts prepared by
institutional equity research analysts about Omnicare, we have assumed that they
have been reasonably prepared on the bases reflecting the best currently
available estimates and judgments of such analysts as to the future financial
performance of Omnicare. We have also assumed that the Merger will qualify for
pooling-of-interests accounting treatment and be a tax-free transaction for the
stockholders of COROMED.

This letter is provided solely for the information of the Board of Directors of
the Company and is not on behalf of, and shall not confer rights or remedies
upon, any stockholder of the Company, or any other person other than the
Company's Board of Directors. This letter may not be published or otherwise used
and no public references to Wessels, Arnold & Henderson, L.L.C. may be made
without our prior consent. Further, our opinion speaks only as of the date
hereof and is based on conditions as they exist and information which we have
been supplied as of the date hereof. We specifically disclaim any obligation to
update our opinion after the date hereof.

Based on our experience as investment bankers and subject to the foregoing,
including the various assumptions and limitations set forth herein, it is our
opinion that, as of the date hereof, the consideration to be received by
COROMED's stockholders in the proposed Merger, as described in the Agreement, is
fair, from a financial point of view, to such stockholders.

Our opinion set forth herein confirms the oral advice that we delivered to
certain members of the Board of Directors prior to COROMED's execution of the
Agreement.

Very truly yours,

Wessels, Arnold & Henderson, L.L.C.

By: /s/ BRYSON D. HOLLIMON
----------------------
Bryson D. Hollimon
Managing Director and
Head of Investment Banking

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PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 20. INDEMNIFICATION OF DIRECTORS AND OFFICERS

The Omnicare Certificate provides that a director of Omnicare
will not be liable to Omnicare or its stockholders for monetary damages for
breach of fiduciary duty as a director, to the full extent permitted by the
DGCL, as amended or interpreted from time to time.

DGCL Section 102(b)(7) allows a company to limit the personal
liability of the directors of the company for violations of their fiduciary
duties. In effect, a director will not be personally liable for monetary
damages for actions involving a breach of his fiduciary duty of care, including
any such actions involving gross negligence. However, a director's liability
to the company or its stockholders for monetary damages may not be eliminated
or limited (i) for any breach of the director's duty of loyalty to the company
or its stockholders, (ii) for acts or omissions not in good faith or which
involve intentional misconduct or a knowing violation of the law, (iii) for
unlawful payment of dividends or unlawful stock purchases or redemptions, or
(iv) for any transaction from which the director derived an improper personal
benefit.

In addition, the Omnicare Certificate states that Omnicare
shall, to the full extent permitted by the DGCL, as amended or interpreted from
time to time, indemnify all directors, officers and employees whom it may
indemnify pursuant thereto and in addition, Omnicare may, to the extent
permitted by the DGCL, indemnify agents of Omnicare or other persons.

DGCL Section 145 gives a corporation broad powers to
indemnify officers, directors and employees who were, are or are threatened to
be made party to a suit due to their roles as such or were serving at the
request of the corporation as a director, officer, or employee or agent of
another entity at the request of the corporation, against expenses (including
attorneys' fees), judgments, fines and settlement fees, if such person acted in
good faith and in a manner the person reasonably believed to be in or not
opposed to the best interest of the corporation. The indemnification allowed
under DGCL Section 145 is not deemed exclusive of any other rights that such
person may be entitled to under any bylaw, agreement, vote of stockholders or
disinterested directors.

DGCL Section 145 also allows a corporation to purchase and
maintain insurance on behalf of any person who is or was a director, officer,
employee or agent of the corporation, or is or was serving at the request of
the corporation as a director, officer, employee or agent of another entity
against any liability asserted against such person whether or not the
corporation would have the power to indemnify him against such liability under
this section.
<PAGE> 146
Omnicare carries Liability Insurance for its directors and officers.

ITEM 21. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

(a) EXHIBITS

<TABLE>
<S> <C>
2.1 - Agreement and Plan of Merger, dated as of January 27, 1997, by and among
Omnicare, Merger Sub, Coromed and certain Principal Stockholders of Coromed.
Attached as Appendix A to the Proxy Statement/Prospectus included in this
Registration Statement.

2.2 - Support Agreement, dated as of January 27, 1997, by and among Omnicare and
certain Principal Stockholders of Coromed. Attached as Appendix B to the
Proxy Statement/Prospectus included in this Registration Statement.

3.1 - Restated Certificate of Incorporation of Omnicare.(1)

3.2 - Amended Bylaws of Omnicare.(2)

4.1 - Indenture, dated as of October 1, 1993, between Omnicare and NBD Bank, N.A.,
Trustee, as amended October 20, 1993, for the 5-3/4% Convertible Subordinated
Notes due 2003. Incorporated by reference from Registrant's Form 8-K, filed
October 20, 1993.

5.1 - Opinion of Dewey Ballantine.

8.1 - Form of Opinion of Morgan, Lewis & Bockius LLP as to certain federal income
tax matters.
10.1 - Executive Salary Protection Plan, as amended, May 22, 1981.(3)

10.2 - 1981 Stock Incentive Plan, as amended. Incorporated by reference from
Registrant's Form 10-K, filed March 25, 1988.

10.3 - 1989 Stock Incentive Plan. Incorporated by reference from Registrant's Proxy
Statement for 1989 Annual Meeting of Principal Stockholders dated April 10,
1989.

10.4 - 1992 Long-Term Stock Incentive Plan. Incorporated by reference from
Registrant's Proxy Statement for 1992 Annual Meeting of Principal Stockholders
dated April 6, 1992.

10.5 - 1995 Premium-Priced Stock Option Plan. Incorporated by reference from
Registrant's Proxy Statement for 1995 Annual Meeting of Principal Stockholders
dated April 10, 1995.

10.6 - Excess Benefits Plan. Incorporated by reference from Registrant's Form 10-K,
filed March 25, 1988.

10.7 - Asset Purchase Agreement, dated as of March 18, 1993, between Omnicare and
Clar-Ron, Inc. Incorporated by reference from Registrant's Form 8-K, filed
April 7, 1993.

10.8 - Asset Purchase Agreement, dated as of September 2, 1994, between Omnicare and
Evergreen Pharmaceutical, Inc. Incorporated by reference from Registrant's
Form 8-K, filed September 2, 1994.

10.9 - Form of Indemnification Agreement with Directors and Officers. Incorporated
by reference from Registrant's Proxy Statement for 1987 Annual Meeting of
Principal Stockholders dated April 14, 1987.

10.10 - Employment Agreements with J.F. Gemunder and C.D. Hodges dated August 4, 1988.
Incorporated by reference from Registrant's Form 10-K, filed March 29, 1989.

10.11 - Amendment to Employment Agreements with J.F. Gemunder and C.D. Hodges dated
May 17, 1993. Incorporated by reference from Registrant's Form 10-K, filed
March 25, 1994.

10.12 - Employment Agreement with T.R. Marsh dated August 4, 1988 and Amendment dated
May 17, 1993. Incorporated by reference from Registrant's Form 10-K, filed
March 25, 1994.

10.13 - Employment Agreement with P.E. Keefe dated March 4, 1993. Incorporated by
reference from Registrant's Form 10-K, filed March 25, 1994.

10.14 - Employment Agreement with K.W. Chesterman dated May 17, 1993. Incorporated by
reference from Registrant's Form 10-K, filed March 25, 1994.

10.15 - Amendment to Employment Agreements with J.F. Gemunder, K.W. Chesterman, P.E.
Keefe, C.D. Hodges and T.R. Marsh dated May 16, 1994. Incorporated by
reference from Registrant's Form 10-K, filed March 25, 1995.

10.16 - Amendment to Employment Agreements with J.F. Gemunder, K.W. Chesterman, P.E.
Keefe and C.D. Hodges dated May 15, 1995.(3)

10.17 - Split Dollar Agreement with E.L. Hutton dated June 1, 1995 (Agreement in the
same Form exists with J.F. Gemunder).(3)

10.18 - Split Dollar Agreement with K.W. Chesterman dated June 1, 1995 (Agreements in
the same Form exists with the following Executive Officers: C.D. Hodges and
P.E. Keefe).(3)

11.1 - Statement re computation of per share earnings of Omnicare.

11.2 - Statement re computation of per share earnings of Coromed.

21.1 - Subsidiaries of the Registrant.(3)

23.1 - Consent of Dewey Ballantine (included as part of its opinion filed as Exhibit
5.1 hereto).
</TABLE>

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<TABLE>
<S> <C>
23.2 - Consent of Morgan, Lewis & Bockius LLP (included as part of its opinion filed
as Exhibit 8.1 hereto).

23.3 - Consent of Coopers & Lybrand L.L.P.

23.4 - Consent of Price Waterhouse LLP.

24.1 - Power of Attorney, included as part of the Signature page in this Registration
Statement.

99.1 - Form of Proxy for holders of Coromed Common Stock.

99.2 - Form of Letter to Coromed stockholders.

99.3 - Form of Notice to Coromed stockholders.

99.4 - Fairness Opinion of Wessels, Arnold & Henderson, L.L.C. Attached as Appendix
D to the Proxy Statement/Prospectus included in this Registration Statement.
</TABLE>

(b) FINANCIAL STATEMENT SCHEDULES

Schedule II - Valuation & Qualifying Accounts

____________________

(1) Incorporated by reference from Registrant's Registration Statement on
Form S-3, Registration No. 33-59689.

(2) Incorporated by reference from Registrant's Annual Report on Form 10-K
for the fiscal year ended December 31, 1992.

(3) Incorporated by reference from Registrant's Annual Report on Form 10-K
for the fiscal year ended December 31, 1995.

ITEM 22. UNDERTAKINGS.

The undersigned registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act of 1933, each
filing of the registrant's annual report pursuant to section 13(a) or section
15(d) of the Securities Exchange Act of 1934 (and, where applicable, each
filing of an employee benefit plan's annual report pursuant to section 15(d) of
the Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.

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The undersigned registrant hereby undertakes as follows: that
prior to any public reoffering of the securities registered hereunder through
use of a prospectus which is a part of this registration statement, by any
person or party who is deemed to be an underwriter within the meaning of Rule
145(c), the issuer undertakes that such reoffering prospectus will contain the
information called for by the applicable registration form with respect to
reofferings by persons who may be deemed underwriters, in addition to the
information called for by the other Items of the applicable form.

The registrant undertakes that every prospectus (i) that is
filed pursuant to the immediately preceding paragraph or (ii) that purports to
meet the requirements of section 10(a)(3) of the Act and is used in connection
with an offering of securities subject to Rule 415, will be filed as a part of
an amendment to the registration statement and will not be used until such
amendment is effective, and that, for purposes of determining any liability
under the Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.

Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the registrant pursuant to the foregoing provisions, or otherwise,
the registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expense incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will, unless in
the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the act and
will be governed by the final adjudication of such issue.

The undersigned registrant hereby undertakes to respond to requests
for information that is incorporated by reference into the prospectus pursuant
to Items 4, 10(b), 11 or 13 of this Form, within one business day of receipt of
such request, and to send the incorporated documents by first class mail or
other equally prompt means. This includes information contained in documents
filed subsequent to the effective date of the registration statement through
the date of responding to the request.

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The undersigned registrant hereby undertakes to supply by
means of post-effective amendment all information concerning a transaction, and
the company being acquired involved therein, that was not the subject of and
included in the registration statement when it became effective.

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SIGNATURES

Pursuant to the requirements of the Securities Act, the
Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of
Cincinnati, State of Ohio, on this 4th day of March, 1997.

March 4, 1997 OMNICARE, INC.

/s/ JOEL F. GEMUNDER
---------------------
Joel F. Gemunder, President

POWER OF ATTORNEY

KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Edward L. Hutton, Joel F.
Gemunder and Cheryl D. Hodges his or her true and lawful attorneys-in-fact and
agents, with full power of substitution, and each with power to act alone, to
sign and execute on behalf of the undersigned any amendment or amendments to
this Registration Statement on Form S-4, and to perform any acts necessary to
be done in order to file such amendment with exhibits thereto and other
documents in connection therewith with the Securities and Exchange Commission,
and each of the undersigned does hereby ratify and confirm all that said
attorneys-in-fact and agents, or their substitutes, shall do or cause to be
done by virtue hereof.

Pursuant to the requirements of the Securities Act, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.

<TABLE>
<CAPTION>
Signature Title Date
<S> <C> <C>

/s/EDWARD L. HUTTON Chairman and Director March 4, 1997
- ------------------------
Edward L. Hutton (Principal Executive Director) March 4, 1997

/s/JOEL F. GEMUNDER President and Director March 4, 1997
- ------------------------
Joel F. Gemunder (Principal Executive Officer) March 4, 1997

/s/DAVID W. FROESEL, JR. Senior Vice President and March 4, 1997
- ------------------------ Chief Financial Officer
David W. Froesel, Jr. (Principal Financial Officer and
Principal Accounting Officer)

/S/RONALD K. BAUER Director March 4, 1997
- ------------------------
Ronald K. Bauer

/s/KENNETH W. CHESTERMAN Director March 4, 1997
- ------------------------
Kenneth W. Chesterman

/s/CHARLES H. ERHART, JR. Director March 4, 1997
- -------------------------
Charles H. Erhart, Jr.

/s/MARY LOU FOX Director March 4, 1997
- -------------------------
Mary Lou Fox

/s/CHERYL D. HODGES Director March 4, 1997
- -------------------------
Cheryl D. Hodges
</TABLE>

II-6
<PAGE> 151
<TABLE>
<S> <C> <C>

/s/ THOMAS C. HUTTON Director March 4, 1997
- --------------------------
Thomas C. Hutton

/s/ PATRICK E. KEEFE Director March 4, 1997
- --------------------------
Patrick E. Keefe

/s/ SANDRA E. LANEY Director March 4, 1997
- --------------------------
Sandra E. Laney

/s/ ANDREA R. LINDELL Director March 4, 1997
- --------------------------
Andrea R. Lindell

/s/ SHELDON MARGEN, M.D. Director March 4, 1997
- --------------------------
Sheldon Margen, M.D.

/s/ KEVIN J. MCNAMARA Director March 4, 1997
- --------------------------
Kevin J. Mcnamara

/s/ JOHN M. MOUNT Director March 4, 1997
- --------------------------
John M. Mount

/s/ TIMOTHY S. O'TOOLE Director March 4, 1997
- --------------------------
Timothy S. O'Toole

/s/ D. WALTER ROBBINS, JR. Director March 4, 1997
- --------------------------
D. Walter Robbins, Jr.
</TABLE>

II-7
<PAGE> 152

EXHIBIT INDEX

(a) EXHIBITS

3.1 - Restated Certificate of Incorporation of Omnicare.(1)

3.2 - Amended Bylaws of Omnicare.(2)

5.1 - Opinion of Dewey Ballantine.

8.1 - Form of Opinion of Morgan, Lewis & Bockius LLP as to certain federal income
tax matters.

10.1 - Executive Salary Protection Plan, as amended, May 22, 1981.(3)

10.2 - 1981 Stock Incentive Plan, as amended. Incorporated by reference from
Registrant's Form 10-K, filed March 25, 1988.

10.3 - 1989 Stock Incentive Plan. Incorporated by reference from Registrant's Proxy
Statement for 1989 Annual Meeting of Principal Stockholders dated April 10,
1989.

10.4 - 1992 Long-Term Stock Incentive Plan. Incorporated by reference from
Registrant's Proxy Statement for 1992 Annual Meeting of Principal Stockholders
dated April 6, 1992.

10.5 - 1995 Premium-Priced Stock Option Plan. Incorporated by reference from
Registrant's Proxy Statement for 1995 Annual Meeting of Principal Stockholders
dated April 10, 1995.

10.6 - Excess Benefits Plan. Incorporated by reference from Registrant's Form 10-K,
filed March 25, 1988.

10.7 - Asset Purchase Agreement, dated as of March 18, 1993, between Omnicare and
Clar-Ron, Inc. Incorporated by reference from Registrant's Form 8-K, filed
April 7, 1993.

10.8 - Asset Purchase Agreement, dated as of September 2, 1994, between Omnicare and
Evergreen Pharmaceutical, Inc. Incorporated by reference from Registrant's
Form 8-K, filed September 2, 1994.

10.10 - Employment Agreements with J.F. Gemunder and C.D. Hodges dated August 4, 1988.
Incorporated by reference from Registrant's Form 10-K, filed March 29, 1989.
</TABLE>
<PAGE> 153
<TABLE>
<S> <C>
10.11 - Amendment to Employment Agreements with J.F. Gemunder and C.D. Hodges dated
May 17, 1993. Incorporated by reference from Registrant's Form 10-K, filed
March 25, 1994.