OSTEOTECH INC
4, 1996-10-10
MISC HEALTH & ALLIED SERVICES, NEC
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<PAGE>

FORM 4 (CONTINUED)


                                    U.S. SECURITIES AND EXCHANGE COMMISSION
                                             WASHINGTON, D.C. 20549

                              STATEMENT OF CHANGES IN BENEFICIAL OWNERSHIP

<square>Check this box if no longer
   subject to Section 16. Form 4      
   or Form 5 obligations may continue.
   SEE Instruction 1(B)
 
 Filed pursuant to Section 16(a) of the Securities Act of 1934,
 Section 17(a) of the Public Utility or Form 5 obligations Holding
 Company Act of 1935 or Section 30(f) of the Investment Company Act of 1940
  


<TABLE>
<CAPTION>
1. Name and Address of Reporting Person        2. Issuer Name and Ticker or Trading Symbol   6.  Relationship of Reporting Person
                                                                                             to Issuer
Jeffries,           Michael          J.                     OSTEOTECH, INC. (OSTE)                  (Check all applicable)

                                                                                                   X     Director______ 10% Owner
<S>                                            <C>        <C>   <C> <C>      <C>    <C>      <C>            <C>         <C>
(Last)              (First)           (Middle) 3. IRS or Social     4. Statement for            ___X____ Officer     ______ Other
                                                  Security Number      Month/Year               (give title below)
C/O OSTEOTECH, INC.                               of Reporting                               (specify below)
51 JAMES WAY                                      Person                 September 1996
                                                  (Voluntary)                                      Executive Vice President
                                                                                                    Chief Operating Officer
                                                   ###-##-####                                      Chief Financial Officer
                   (Street)                                         5. If Amendment, Date of
                                                                    Original (Month/Year)
EATONTOWN, NEW JERSEY
07724
(City)              (State)              (Zip)
                                               TABLE I - NON-DERIVATIVE SECURITIES ACQUIRED, DISPOSED OF, OR BENEFICIALLY OWNED
1. Title of Security                           2. Trans-  3. Trans- 4. Securities Acquired   5. Amount of   6. Owner-   7. Nature
   (Instr. 3)                                     action     action    (A) or Disposed of       Securities     ship        of In-
                                                  Date       Code      (D)                      Beneficially   Form:       direct
                                                  (Month/  (Instr.     (Instr. 3, 4 and 5)      Owned at       (D) or      Bene-
                                               Day/       8)                                    End of         Indirect    ficial
                                               Year)                                            Month          (I)         Owner-
                                                                                                (Instr. 3      (Instr.     ship
                                                                                             and 4)         4)             (Instr.
                                                                                                                        4)
                                                          Code   V   Amount  (A) or Price
                                                                               (D)

COMMON STOCK A                                 09/30/96     P    v    186      A    $4.8875        32,014          D          --

</TABLE>

Reminder: Report on a separate line for each class of securities beneficially
owned directly or indirectly.
                                               (Over)













<PAGE>

FORM 4 (CONTINUED)


  TABLE II - DERIVATIVE SECURITIES ACQUIRED, DISPOSED OF, OR BENEFICIALLY OWNED
  (E.G., puts, calls, warrants, options, convertible securities)

<TABLE>
<CAPTION>
1. Title of Derivative 2.Conver-3.Trans-4.Transac-5.Number of6.Date    7.Title and Amount 8.Price9.Number 10.  Owner-  11.  Na-
Security                 sion     action tion  Deriv-       Exercisableof Under-lying       of    of        ship         ture
   (Instr. 3)            or       Date   Code  ative        and        Securities (Instr.   Deriv-Deriv-     Form         of In-
                         Exercise (Month/Day/(Instr.SecuritiesExpiration3 and 4)            ative ative      of De-       direct
                         Price    Year)8)      Ac-          Date                            Secur-Secur-     rivative     Bene-
                         of                    quired (A)   (Month/Day/                     ity   ities      Secur-       ficial
                         Deriv-                or Dis-      Year)                           (Instr.Bene-     ity:         Own-
                         ative                 posed of                                     5)    ficially   (D) or         ership
                       Security                (D)                                                Owned      Indi-       (Instr. 4)
                                               (Instr. 3,                                         at End     rect (I)
                                             4, and 5)                                            of        (Instr. 4)
                                                                                                  Month
                                                                                                  (Instr.
                                                                                                4)
<S>                    <C>      <C>    <C><C><C>    <C>   <C>   <C>    <C>         <C>    <C>   <C>       <C>          <C>
                                       CodeV    (A) (D)   Date  Expira-    Title   Amount
                                                          Exer- tion               or
                                                          cisableDate              Number
                                                                                   of
                                                                                   Shares
</TABLE>

  Explanation of Responses:

  a    Purchased under the Company's Stock Purchase Plan, a Rule 16b-3 plan.






** Intentional misstatements or omissions of facts constitute Federal Criminal
   Violations .
                          /s/ MICHAEL J. JEFFRIES              10/7/96
                          **Signature of Reporting Person         Date
                          Michael J. Jeffries



See 18 U.S.C. 1001 and 15 U.S.C. 78ff(a).

Note:  File three copies of this Form, one of which must be manually signed.
   If space provided is insufficient, SEE Instruction 6 for procedure.
                                                      SEC 1474 (8-92)



















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