10KSB/A

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

	FORM 10-KSB

(Mark One)
 X 	ANNUAL REPORT PURSUANT TO SECTION 13 or 15(d) OF THE 
SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED]

For the fiscal year ended June 30, 1997

   	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE 
SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]

For the transition period from ______ to ______

	Commission File No. 0-16341

	               ADVANCED MEDICAL PRODUCTS INC.         
	(Name of Small Business Issuer in its Charter)

              Delaware           		        16-1284228       
  (State or other Jurisdiction		  (I.R.S. Employer
of Incorporation or Organization)		 Identification No.)

	6 Woodcross Drive, Columbia, South Carolina		  29212 
 
	 (Address of Principal Executive Offices)		(Zip Code)

	                 (803) 407-3044               
	Issuer's Telephone Number, Including Area Code)

	Securities Registered Under Section 12(b) of the Exchange Act

							Name of Each Exchange on
   Title of Each Class			      Which Registered        

        None          			          None                 
 
	Securities Registered Under Section 12(g) of the Exchange Act

	Common Stock, $.01 par value
	(Title of class)

Check whether the Issuer (1) filed all reports required to be filed 
by Section 13 or  15(d) of the Exchange Act during the past 12 
months (or for such shorter period that the Issuer was required to 
file such reports) and (2) has been subject to such filing 
requirements for the past 90 days.
Yes [   ]	  No [ x ]

Check here if disclosure of delinquent filers in response to Item 
405 of Regulation S-B is not contained in this form, and no 
disclosure will be contained, to the best of the Issuer's knowledge, 
in definitive proxy or information statements incorporated by 
reference in Part III of this Form 10-KSB or any amendment to this 
Form 10-KSB. [   ]

The Issuer's total revenues for its most recent fiscal year were 
$2,976,847.

The aggregate market value, as of December 31, 1997, of voting stock 
held by non-affiliates was approximately $820,524.97/
 
The number of outstanding shares of common equity on December 31, 
1997 was 5,962,495

Transitional Small Business Disclosure format (check one):
Yes [    ]	  No [ X ]

Total pages =   .   	Exhibit Index Appears on Page   .

	ADVANCED MEDICAL PRODUCTS INC.


	INDEX


		Item									Page

PART I	
  1.   Description of Business				                            3
		
		2.   Description of Property				                           15 

		3.   Legal Proceedings					                                16 

		4.   Submission of Matters to a Vote of
    			Security Holders					                                 17  

PART II	
  5.   Market for Common Equity
		    	and Related Stockholder Matters		                     17

		6.   Management's Discussion and Analysis	                 20

		7.   Financial Statements					                             25  

		8.   Changes in and Disagreements with
    			Accountants on Accounting
			    and Financial Disclosure				                          25  

PART III	
  9.   Directors, Executive Officers, Promoters
		    	and Control Persons; Compliance with
			    Section 16(a) of the Exchange Act		                   26  

		10.  Executive Compensation				                            28

		11.  Security Ownership of Certain Beneficial
    			Owners and Management				                             34  

		12.  Certain Relationships and Related Transactions					 	 35  

PART IV	
  13.  Exhibits, List and Reports on Form 8-K	               36  


Item 1.	Description of Business

	Advanced Medical Products Inc. (the "Registrant" or the "Company") 
develops, manufactures, assembles and markets medical diagnostic equipment and 
software primarily for use in physicians' offices.  Holter monitors (24 hour 
electrocardiogram (ECG) monitors) and ambulatory blood pressure (ABP) 
instruments have provided most of the Company's past sales. A portable 
ultrasound imager developed by the Company has not produced sales, but is 
expected to contribute to future sales.

	The Company has demonstrated it's ability to develop, produce and market 
miniaturized electronic devices for medical applications that are generally 
smaller, lighter and take less power than similar products offered by 
competitors; it's mission is to provide to the medical profession leading edge 
hardware and software technology that will save physicians time, reduce cost of 
health care and improve patient outcomes.  Most of the Company's revenues in 
the past have resulted from sales to office based family practice physicians, 
internists and cardiologists.  Because of changes taking place in health care, 
the Company is in the process of redirecting much of it's marketing efforts 
towards managed care organizations, including Health Maintenance Organizations 
(HMO's), Group Purchasing Organizations (GPO's), Integrated Health Networks 
(IHN's) and hospitals where many of the purchasing decisions are now being 
made.  In addition, much of the engineering development efforts are being 
directed toward enhancements and features such as personal computer (PC) 
interfaces, "Windows" based software and digital storage and electronic 
transfer of medical records (telemedicine) that make the Company's products 
more attractive to the markets available in the current health care 
environment.  The Company intends that all future products will be PC based, 
and will include telemedicine features.

	The Registrant was incorporated under the laws of the State of Delaware 
on September 3, 1986, and in June 1987, successfully concluded an initial 
public offering of its Common Stock, providing net proceeds to the Registrant 
of approximately $2,034,000.  Effective September 13, 1989, the Registrant 
reverse split its outstanding Common Stock at the rate of 1:100, and 
recapitalized so as to authorize the issuance of a total of 5,000,000 shares of 
Common Stock, $.01 par value.  All references to shares and per share data in 
this Annual Report give retroactive effect to such reverse split and re-
capitalization.  In September 1992, the Company amended its Certificate of 
Incorporation so as to create a class of stock consisting of 4,000 shares of 
redeemable Class A Preferred Stock, and sold 2,000 of such shares, for 
$2,000,000, to Nishimoto Sangyo Company, Ltd., (Nishimoto) a distributor of the 
Company's products (see "Distributor/OEM Arrangements", and "Market for Common 
Equity and Related Stockholder Matters").  In 1996, Nishimoto assigned all 
rights of redemption on the preferred stock to the Company and purchased 113 
additional shares of preferred stock, and subscribed for 300,000 shares of 
common stock, paid in satisfaction of $215,000 in unpaid dividends and 
interest.  In 1996, the Company amended its certificate of incorporation 
increasing the authorized common stock to 7,000,000 shares.

	During the Registrant's third quarter of fiscal 1996, Carolina Medical 
Inc. purchased from the Company a total of 2,150,000 shares, or 42.1%, of the 
Company's then currently issued and outstanding common stock for $430,000.  In 
November 1997, Carolina Medical purchased an additional 850,000 common shares, 
which increased that Companys ownership in the registrants common stock to 
3,000,000 shares or 50.3% of the total outstanding.

	For the two fiscal years ended June 30, 1996 and June 30, 1997, the 
Registrant generated revenues of $4,232,428, and $2,976,847, respectively, and 
incurred net losses of $(1,040,418), and $(680,912), respectively.  In 1996, 
equity investments of $430,000, the conversion of the $2,000,000 in redeemable 
preferred stock into non-redeemable preferred stock, the conversion of $215,000 
in unpaid dividends into equity, the conversion of $160,000 in past due rent 
into long term liability (which was subsequently converted to equity in 
September 1996), the cancellation of certain future long term lease payment 
obligations and the implementation of operating cost reductions totaling more 
than $60,000 per month, the Company's financial position was substantially 
improved.  In December 1996, Nishimoto converted $104,000 of their December 31, 
1996 preferred stock dividend into 104 shares of $1,000 face value Preferred 
Stock to bring their total Preferred Stock ownership to 2,217 shares out of 
2,377 shares of Class A Preferred Stock outstanding.

PRODUCTS

	The Company's products include various solid state electronic medical 
diagnostic devices supported by several proprietary "D.O.S." and "Windows" 
based software programs that run on personal computers.  Current products 
consist of a family of ambulatory electrocardiogram ("ECG") monitors, and 
ambulatory blood pressure ("ABP") monitors. The Company's products are 
assembled at and shipped from the Company's facilities in Columbia, South 
Carolina (see "Assembly and Shipping", below) and are marketed by the Company 
and by several private label distributors (see "Distributor/OEM", below).  
Manufacturing of circuit assemblies is out sourced to contract manufacturers.  
The Company markets its products through in-house marketing personnel, with 
extensive use of direct mail and telemarketing in conjunction with independent 
manufacturers representatives (see "Sales and Marketing", below).  During 
fiscal 1997, product revenue was derived from sales of ambulatory ECG monitors 
and blood pressure monitors and a unique combination unit that monitors both 
ECG and blood pressure.  The Company's first marketable software product, the 
MICRO ANALYST I was introduced during the year and had some sales; however, the 
MICRO ANALYST I is expected to contribute more to 1998 revenues.

	Marketing of the Company's existing and proposed products are and will be 
subject to the jurisdiction of the Federal Food and Drug Administration 
("FDA").  In addition, the ability of the Company to successfully market its 
products is materially dependent upon the extent to which medical procedures 
utilizing the Company's products are reimbursable under insurance programs.  
While most procedures utilizing the Company's existing products are currently 
reimbursable, there is no assurance that current reimbursement policies will 
continue.  Further, changes in the national health care system brought about by 
changes in governmental regulation, and in the insurance industry have had and 
will continue to have substantial affect on the Company and its operations.  
(See "Government Regulation" and "Insurance Reimbursement", below.)

Ambulatory ECG (Holter) Monitor

	An electrocardiogram ("ECG") is a primary source of diagnostic 
information for the physician as it has the capability to non-invasively 
(without puncture or incision of the skin or insertion of an instrument into 
the body) record and detect electrical events of the heart, including 
arrhythmia's (disorders of the cardiac rhythm) and/or symptomatic or 
asymptomatic (without symptoms) ischemia (the interruption of blood supply and 
oxygen to the heart, caused by the blockage of coronary arteries).  An 
ambulatory (a diagnostic technique where the patient is monitored while 
engaging in normal activities) ECG monitor consists of electrodes which are 
taped to the patient's chest and connected by cables to a monitor which records 
up to 24 hours of ECG information transmitted from the electrodes. The ECG 
monitor stores the information received, and, when connected to a computer 
and/or external printer, can be stored for future use, displayed on a viewing 
monitor and/or printed, or transmitted electronically to a remote site for 
interpretation by a specialist.

	The various ECG monitoring systems produced and marketed by the Company 
are designed to produce a concise printout of the recorded information. Each 
system consists of a monitor, weighing approximately six ounces and powered by 
two "triple A" 1.5 volt batteries, a printer, which is a standard computer 
printer with certain modifications, computer software, connecting cables and, 
in certain models, a personal computer and laser printer (if desired by the 
customer).

	The Company's proprietary MICRO FD? ECG Monitor has the ability to 
continuously record, and subsequently print out, up to 24 hours of ECG 
waveforms in a compressed format known as "full disclosure".  In addition, this 
system prints full size, diagnostic quality ECG strips of clinically 
significant events, such as arrhythmias and ischemia.

	The Company's proprietary MICRO SI? was introduced in 1988.  The MICRO 
SI? utilizes the same basic technology as the MICRO FD?, and, in addition, by 
interfacing the monitor with a computer, the operator is provided with a 
variety of analysis, editing, display, reporting and/or storage options, 
including comprehensive printout capabilities. Included is an option for high 
speed, superimposition scanning.

	The Company's proprietary "New Age" ambulatory ECG monitoring system 
introduced in 1992 is an advancement over the MICRO FD? and MICRO SI? systems 
due to its smaller size and lighter weight.  The "New Age" system is used with 
a direct operator interface or by interfacing with a monitor and computer, 
using proprietary "New Age" software developed by the Company, which runs on 
the "D.O.S." operating system.  The Company recently introduced a new software 
product called "MICRO ANALYST I" for use with the New Age which operates on a 
PC under the "Windows" or "Windows 95" operating systems.  Numerous features 
and enhancements were added to the MICRO ANALYST I during fiscal 1997.

	The Company has received FDA pre-marketing authorization to market its 
family of ambulatory ECG (Holter) monitoring systems.  Procedures utilizing 
technology of the type incorporated in its family of ambulatory ECG systems are 
currently reimbursable under guidelines recommended by the Health Care 
Financing Administration ("HCFA"), and under most private third-party 
reimbursement programs.  (See "Government Regulation", below.)


Ambulatory Blood Pressure Monitor

	The Company also markets a family of diagnostic devices incorporating an 
ambulatory blood pressure monitor (the "ABP Monitor").  The ABP Monitor records 
up to 24 hours of blood pressure data, including systolic, diastolic and mean 
arterial pressures and pulse rate in a solid state recorder.  Management 
believes that the ABP Monitor is smaller, lighter and quieter than similar 
units available from other manufacturers, and is designed to be more 
comfortable for the patient.  Results recorded by the ABP Monitor are capable 
of being printed out in a tabular format on a printer or displayed on a viewing 
monitor.

	The Company currently offers both a stand-alone ABP monitor and combined 
ECG Holter and ABP Monitor.  The Company has received FDA pre-marketing 
clearance to market the ABP Monitor.  The stand-alone blood pressure monitoring 
procedure is not generally reimbursable under many existing government-
sponsored reimbursement programs; however, private, third-party insurers are 
increasingly approving reimbursement for the blood pressure procedure.  
Management believes that this trend is due to lower long-term costs to carriers 
when hypertension is diagnosed early.  The ECG Holter procedure performed 
simultaneously with the blood pressure procedure, utilizing the Company's 
combined ECG Holter and ABP Monitor, is currently reimbursable under existing 
reimbursement guidelines recommended by HCFA.  Due to current reimbursement 
guidelines, Management anticipates that domestic sales of ABP Monitors will 
continue to be predominantly for the combined ECG Holter and ABP Monitor 
version of the product.  This product is unique in the market as the Company 
believes it is currently the only manufacturer producing a combination system.

Twelve Lead Electrocardiograph

	During fiscal 1993, the Company commenced marketing a twelve lead 
electrocardiograph (the "SPECTRA ECG?") for use in the physicians' office.  The 
SPECTRA ECG? is designed to operate in conventional "12 lead" or "rhythm" 
modes, thus allowing the physician to perform in-office ECG analysis.  To 
assist the physician in this analysis, the SPECTRA ECG? performs an 
"interpretive" analysis.  The SPECTRA ECG? incorporates computer software that 
is proprietary to an unaffiliated third party.  The Company has licensed the 
non-exclusive right to use such software in the SPECTRA ECG?, and incurred 
annual license fees for such right.  The Company pays royalties based upon 
products actually sold, subject to minimum annual guaranteed royalties payable 
to the licensor.  Management determined in 1996 that the Company had not been 
successful at selling the SPECTRA ECG product against aggressively priced 
competitive products at prices and in sufficient quantity that would cover 
manufacturing, royalty and selling expenses.  Therefore, the Company has phased 
out the SPECTRA ECG product.  Reserves were booked in 1996 to cover the costs 
of such phase out. Effective April 1, 1996 the minimum annual guaranteed 
royalty was terminated by agreement with the Licensor.  

Ultrasound Imager

	The Company has developed the first model of a miniaturized, hand-held, 
ultrasound imager (the "MICROS QV?" previously known as the "Ultra PCI").  
Market introduction of this product at the American College of Emergency 
Physicians show in September 1996 gave indicators of strong market interest.  
The MICROS QV? displays real time, ultrasound images of internal organs on a 
small flat panel television screen (3" diagonal).  The unit permits the 
physician to "freeze" any image on the television screen and store up to ten 
images internally in digital memory.  The image may be reproduced to a hard 
copy through an accompanying printer or transmitted to a personal computer for 
storage on a hard disk or floppy disk for subsequent image storage, archiving, 
processing or for electronic transfer to a remote location for interpretation 
or "second opinion" by a specialist.  The MICROS QV? weighs approximately 33 
ounces and its size is approximately 5"x2"x9".  The unit is powered by a 
rechargeable battery pack that provides up to two hours of continuous scanning.

	Management believes that the MICROS QV? is a unique product which 
provides two major advantages over other currently available ultrasound 
technology: first, the ease of use of a small unit, and; second, the lower cost 
of the device.  Management is not aware of another hand held ultrasound imager 
currently available in the marketplace.  Management believes that the market 
for the MICROS QV? includes various hospital departments such as emergency 
departments and radiology and a wide range of physicians, including 
gynecologists, obstetricians, cardiologists, internists, family practitioners 
and general practitioners. In emergency room, ambulance of emergency helicopter 
situations, life saving answers may sometimes be found using the portable 
MICROS QV? Ultrasound system for immediate abdominal or pelvic exams.  Findings 
may include (but not limited to) pericardial effusion, left ventricle 
hypertrophy, ectopic pregnancy, ovarian cyst, fluid in the abdomen, abdominal 
aortic aneurysm, gall stones and kidney stones.
	
	The Company has received FDA pre-marketing authorization for the MICROS 
QV?, and has built prototype units, but does not presently have the financial, 
technical or marketing resources needed to release the product.  While 
Management believes that procedures utilizing the MICROS QV? will be 
reimbursable on a basis equivalent to procedures utilizing other ultrasound 
imagers, there is no assurance that such reimbursement will continue at its 
present rate.  (See "Government Regulation", below.)

	Other Products - The Company intends to identify, develop, license or 
purchase technology consistent with its objective of marketing medical 
diagnostic equipment and software for use in the physicians' office and for 
selective niche hospital applications.  While Management is currently 
considering several technologies for development by the Company, no material 
contractual and/or capital commitments have yet been made with respect to any 
such technology.

The Company has purchased most of the parts and materials needed to manufacture 
twenty five pre-production units and has completed production of fifteen units 
of the MICROS QV product.  Approximately $135,000 of the Companys inventory is 
devoted to this product line, which could be considered at risk if the 
product is not successfully marketed.

INTERNATIONAL DISTRIBUTION/OEM ARRANGEMENTS

	The Company sells its products internationally through foreign 
distributors, some of whom resell the products under their own private label.  
In addition, the Company derives a portion of its revenues from domestic and 
international arrangements pursuant to which the Company manufactures products 
intended to conform to specifications provided by customers, for resale by such 
customers under their own respective product designations.  In some cases, the 
Company grants the Distributor/OEM an exclusive geographic territory in which 
the Company agrees not to authorize any other Distributor/OEM to sell products 
bearing the product name and/or product configuration manufactured for any 
other Distributor/OEM.  The Company intends to continue to pursue 
Distributor/OEM business on a purchase order basis, and is currently a party to 
Distribution/OEM Agreements with customers including Nishimoto Sangyo Company, 
Ltd. ("Nishimoto"), Kontron Instruments Ltd., and Delmar Avionics.

	Pursuant to the Company's distributor agreement with Nishimoto, Nishimoto 
has agreed to purchase products from the Company for resale under its product 
name and design in Japan and Taiwan.  In addition, at the time of execution of 
the initial Distribution/OEM Agreement, Nishimoto purchased $2,000,000 of the 
Company's redeemable Class A Preferred Stock.  The Distribution/OEM Agreement, 
which expired in October 1997, was extended to October 1998.  The Company 
believes that the Distribution Agreement will be extended year to year.  On 
March 31, 1996 the preferred stock agreement was renegotiated and Nishimoto 
assigned all redemption rights to the Company.  See "Market for Common Equity 
and Related Stockholder Matters", below.

	Nishimoto accounted for 11% of the Company's total revenues in fiscal 
1997 and 13% in fiscal 1996; Kontron accounted for 7% in revenues in 1997 and 
16% in 1996.

GOVERNMENT REGULATION

	Regulations applicable to the marketing of medical devices, including 
claims as to product capability and performance, are generally administered by 
the Federal Food and Drug Administration ("FDA").  In addition, policies 
concerning insurance reimbursement for procedures performed by physicians using 
the Company's products are influenced by determinations of the United States 
Health Care Financing Administration ("HCFA").  The Company has, from time to 
time, consulted with professional advisors experienced in FDA and HCFA matters, 
however no written legal or other opinions have been obtained from such 
advisors in connection with their consulting activities or the Company's FDA 
filings.  The Company relies upon the expertise of Management in formulating 
Company policy affected by FDA and HCFA regulations and guidelines.  Further, 
changes in national health care policy and other changes in governmental 
regulations, have affected and will continue to affect the Company and its 
operations.

FDA Review

	The proprietary non-invasive diagnostic medical products currently 
marketed and under development by the Company are subject to regulatory 
approvals by various government agencies.  The FDA regulates diagnostic devices 
such as those sold and under development by the Company.  If a diagnostic 
product is "substantially equivalent" to one or more pre-existing defined 
products or test procedures, the FDA may not conduct a detailed review.  When 
there is no "substantial equivalent" to one or more pre-existing defined 
products or test procedures, however, the review process may be lengthy.  While 
the Company does not believe that review of its diagnostic devices currently 
under development will be required, there can be no assurance that FDA 
clearance may not be required and if required will be obtained, or that the FDA 
will, in fact, determine that they are "substantially equivalent" devices, or 
that additional testing or modifications will not be necessary to obtain FDA 
clearance, all of which would result in additional expense to the Company and 
would delay marketing and sales of the products affected.  The Company cannot 
proceed with sales of such products until it receives clearance notification 
from the FDA.  In the event that the FDA requests additional information, there 
could be multiple cycles of submissions, each involving a 90 day waiting 
period, until clearance is obtained.  If the FDA grants pre-marketing clearance 
of a product, its regulations will apply to manufacturing and marketing of the 
product, including product labeling.  In the event that FDA clearance is not 
obtained for a product, the Company may be unable to market such product.  FDA 
marketing clearance does not evidence any endorsement or product recommendation 
on its part.

	The Company has received FDA pre-marketing clearance for its family of 
Holter and ECG monitors, its ABP monitors, as well as for the ULTRA PVD? and 
the MICROS QV? ultrasound imagers.

Insurance Reimbursement

	Suppliers of health care products and services are greatly affected by 
Medicare and other government reimbursement programs, which reimbursement rates 
Management believes generally parallel government reimbursement rates.  
Physicians are currently reimbursed specified amounts for diagnostic procedures 
performed with the Company's products.  Reimbursement programs, including those 
applicable to Federal, State and private insurance carriers, are greatly 
influenced by determinations and rate recommendations made by HCFA.  Regional 
Medicare and Medicaid administrators, as well as private carriers, often 
establish their reimbursement rates and policies, based upon HCFA 
recommendations.

	The ability of physicians to perform procedures that are reimbursable 
under insurance programs has a significant impact upon the ability of the 
Company to successfully market its products.  In the event that HCFA 
reclassifies procedures and/or recommends new or different reimbursement rates, 
or should other regulatory changes make it uneconomic to perform diagnostic 
tests in a physician's office, the Company's business could be adversely 
affected.

	Procedures utilizing the Company's existing family of products are 
reimbursable under existing reimbursement codes recommended by HCFA.  However, 
there is no assurance that procedures utilizing such products will continue to 
be reimbursable or that reimbursement will continue at current rates.  
Management believes that blood pressure diagnostic procedures are currently 
reimbursable under insurance guidelines in certain regions and that procedures 
utilizing the ABP Monitor are reimbursable by some private carriers.  
Management expects that such reimbursement will increasingly be approved by 
private carriers as the long-term cost saving benefits of early diagnosis of 
hypertension are shown.

Changes in Legislation

	The current political and social climate in the United States includes 
the continuing pursuit of health care reforms designed to provide health care 
benefits to all Americans.  An emphasis of most health care reform proposals 
was on preventative care, i.e., early diagnostic testing and early intervention 
and treatment, rather than high cost, critical care at a later date.  
Management believes that proposed change in legislation will have a favorable 
impact upon the Company's future operations because they address the need for 
primary care physicians to undertake responsibility for diagnostic testing in 
their office practices.

	While management continues to believe that additional health care reforms 
will be adopted, the current political environment makes it impracticable to 
predict the precise direction and nature that health care reform may take.  The 
extent of governmental regulation of medical diagnostic devices which might 
arise from future legislative or administrative action, and the consequences 
thereof to the Company, cannot accurately be predicted at this time.


SALES AND MARKETING

	The Company markets its products through an in-house network consisting 
of marketing persons, regional sales managers and territorial sales assistants. 
 Marketing personnel utilize on-going direct mail campaigns and selected trade 
shows to create awareness and generate leads for its sales force.  Territory 
sales assistants qualify leads, and the regional sales managers then follow-up 
leads and pursue sales.  Sales personnel are compensated primarily on a 
commission basis (and, in certain cases, by salary plus commission).  The 
Company also markets its products in the U.S. through independent 
manufacturers' representatives.

	The Company has focused its marketing efforts toward office-based, 
primary care physicians, and has found that, due to their large number, direct 
mail and telemarketing are efficient tools to create awareness and generate 
interest in the Company's products. 

	The Company sells its products internationally through foreign 
distributors.  Currently the Company has distribution agreements with Nishimoto 
Sangyo Company Ltd. for distribution in Japan and Taiwan and with Kontron 
Instruments for distribution throughout Europe.


RESEARCH AND DEVELOPMENT

	The Company currently conducts research and development activities in 
order to enhance existing products and develop proposed products.  For the two 
fiscal years ended June 30, 1997 and June 30, 1996, the Company incurred 
research and development expenditures of $205,264, and $363,100, respectively. 
 Additional direct costs of development of the Windows 95 based Analyst I 
software were capitalized during both fiscal years. Most of research and 
development expenses during the most recent fiscal year were incurred in 
connection with enhancements to the Holter and Ambulatory Blood Pressure 
devices; in fiscal 1996, much of the expense was incurred on the Micros QV and 
on write-offs of previously capitalized costs.

	The Company intends to rely upon trade secret protection and 
confidentiality agreements, as well as restrictions on disclosure of 
information contained in design documentation, to safeguard its proprietary 
product designs and technology.  Nevertheless, competitors may be able to learn 
certain of the Company's trade secrets or copy its product designs or develop 
similar products.  Should the Company be unable to safeguard its trade secrets, 
it could materially impact on the Company's business.  (See "Patents and 
Trademarks", below.)


ASSEMBLY AND SHIPPING

	The Company's ECG monitors, its ABP Monitors and MICROS QV Ultrasound 
products consist of solid state electronic components and circuit boards, 
electrical cables and computer software programs.  Some components are standard 
items, while others will be manufactured to the Company's specifications.  The 
components are generally available from multiple sources and the Company does 
not believe it will be dependent upon specific suppliers as the sole source of 
components for its existing and proposed products. The Company currently has no 
binding arrangements with any subcontractors.  Molded plastic parts for the 
various products manufactured by the Company are subcontracted for manufacture 
to the Company's specifications by unaffiliated parties using tooling owned by 
the Company.  Component parts are assembled at and systems are shipped from the 
Company's facilities.  The Company intends to out source more of its 
manufacturing in the future in order to further reduce in-house fixed costs.

	Operations at the Company's facilities include assembly, quality control, 
servicing, and shipping.  The Company performs test and inspection procedures 
in order to minimize errors and enhance operating reliability.  The Company 
believes that its procedures are consistent with regulations established by the 
FDA with respect to manufacturing practices for medical devices.  The FDA 
periodically reviews the Company's facilities and procedures, having recently 
completed a review in October 1997.
 
	There is a risk that the Company may have to repair or replace products 
which it markets or reimburse persons for products in use that prove to be 
defective, and the Company books warranty reserve to cover an estimate of these 
expenses.  In addition, the Company could be subject to claims for personal 
injuries or property damage resulting from the use of its products. To date, 
Management is not aware of any product liability claim against the Company.  
The Company does not currently maintain product liability insurance, and a 
successful product liability claim could have a materially adverse impact on 
the Company's financial condition.

BACKLOG

	As of June 30, 1997 and June 30, 1996, the Company's backlog of orders 
was not significant.  Generally, the Company builds product to forecast and 
ships from stock and does not have a significant backlog.

COMPETITION

	The Company's current and proposed products face competition from a 
variety of professionally accepted and recognized diagnostic systems.  
Competition is based on product characteristics (including reliability and 
performance efficiency), price, warranty terms and service.  Numerous companies 
produce medical electronic equipment, many of which have substantially greater 
financial resources and personnel than the Company.  The Company also competes 
with commercial services, which provide ambulatory ECG and ABP monitoring, and 
ultrasound imaging services to individual physicians, physicians' group 
practices and hospitals.

	The Company believes that its principal competitors in the office 
ambulatory ECG market are Rozin, Burdick, Biosensor and Q-Med, Inc.; and in the 
ambulatory blood pressure market are Spacelabs, Inc., and Welch Allyn.  The 
Company believes there is currently limited competition in the portable 
ultrasound market as Management knows of no hand held ultrasound imager 
currently being produced or manufactured; however, larger, less portable 
ultrasound imagers are currently being marketed for use in hospitals, labs, 
clinics and in the physicians' office.  The efficacy of the Company's products 
has not been verified by independent sources.

PATENTS AND TRADEMARKS

	Management does not believe that the technology incorporated into its ECG 
monitors, ABP Monitors and other current products, or to be incorporated in the 
Company's proposed products, is amenable to patent protection because such 
technology is not new, but rather represents innovative uses for existing 
technology.  The Company intends to rely upon trade secret protection and 
confidentiality agreements, as well as restrictions on disclosure of 
information contained in design documentation, to safeguard its proprietary 
product designs and technology.  Nevertheless, competitors may "reverse 
engineer" the Company's products and thereby learn certain of the Company's 
trade secrets or copy its product designs or develop similar products.  Should 
the Company be unable to safeguard its trade secrets, it could materially 
impact on the Company's business.  While the Company intends to rely on common 
law ownership and un-patented proprietary processes to protect its trade 
secrets, there is no assurance that others will not independently develop such 
processes or independently develop substantially similar processes and even 
obtain patents thereon.  (See "Research and Development", above.)

	The Company claims common law trademark ownership of the identifying 
names of its products (e.g., MICRO SI?, ULTRA PVD?, SPECTRA ECG?, MICROS QV?, 
MICRO ANALYST I, etc.), and evidences such ownership claims through the use of 
symbol "TM".  The Company intends to claim trademark ownership with respect to 
identifying names of proposed products, as and when such proposed products are 
shipped or sold.  The Company has not sought and does not currently intend to 
seek formal Federal trademark registration for its product names.  Such common 
law trademark ownership provides trademark protection only in jurisdictions in 
which the trademark is actually used and, therefore, it is possible that third 
parties may claim trademark ownership in the Company's marks in jurisdictions 
where the Company is not actually using the trademark.  While Management 
believes that Federal registration is not required in order to obtain trademark 
protection, such registration would provide certain protection in addition to 
those afforded by the use of the symbol "TM" (e.g., the right to sue in Federal 
court for trademark infringement; constructive notice of a claim of ownership, 
which eliminates a good faith defense for a party adopting the trademark 
subsequent to the date of registration; and prima facie evidence of the 
validity of the registration, Registrant's ownership of the mark and of 
Registrant's exclusive right to use the mark in commerce in connection with the 
goods specified in the registration certificate).  In the event a third party 
were to successfully challenge any trademarks used by the Company, significant 
expense in adopting new trademarks could be incurred.

EMPLOYEES

	The Company currently employs 15 full-time persons consisting of its 
Chief Executive Officer, its President, 1 Vice President, a sales and marketing 
staff of 4, a manufacturing staff of 4 persons,  1 service person and 1 quality 
control person, a product development engineer, and 1 administrative person.  
The Company also employs part-time persons, 4 in sales, 1 in administration and 
utilizes the services of outside consultants from time to time.  The Company is 
not a party to any collective bargaining agreement and believes it enjoys 
harmonious employee relations.


Item 2.	Description of Property

	The Company is a party to a lease agreement (the "Lease") with T & L A 
Partnership (the "Landlord"), pursuant to which the Company has leased a 10,080 
square foot building located at 6 Woodcross Drive, Columbia, South Carolina 
29212.  This Lease is for a term of five years, which commenced on November 1, 
1996.  The Lease provides for the Company's payment of rent in the amount of 
$6,720 per month for year one, $7,056 per month for year two, $7,392 per month 
for year three, $7,728 per month for year four, and $8,064 per month for year 
five of the Lease term.  The Company is required to maintain the property at 
its expense, and to pay the costs of electricity, lights, water, sewer, heat, 
janitor service and all other utility services consumed in connection with the 
Company's tenancy. 	The Company will have the option of renewing the lease 
for an additional five (5) years at the prevailing rate in effect at the end of 
the initial five year lease period, with all terms and conditions of the 
original lease applicable throughout the second or optional five years.  The 
Company also had an eighteen (18) month purchase option with the right to buy 
the property or assign this option to an affiliated party, which expired on 
April 30, 1998.

	Prior to November 1, 1996, the Company had a lease agreement (the 
"Lease") with South Carolina Real Estate Development Company, Inc. (the 
"Landlord"), pursuant to which the Company leased approximately four acres of 
land and a building consisting of approximately 20,800 square feet situated 
thereon.  The land and building (the "Premises") are located at the Carolina 
Research Park, in Columbia, South Carolina.  The Lease was originally for a 
term of fifteen years, which commenced on or about January 20, 1993. On 
September 20, 1996, the Company  terminated it's lease effective October 31, 
1996 and satisfied all past due amounts with the issuance of 160 shares of 
$1,000 per share face value Class A Preferred Stock.  The Class A Preferred 
Stock carries an annual dividend of five percent (5%) payable in January of 
each year.  The lease was terminated with no further obligations on future 
periods of the lease.

	
Item 3.	Legal Proceedings

	There are no material pending legal proceedings to which the Registrant 
is a party or of which any of its property is subject, nor is the Company aware 
of any material proceedings to which any officer, director or affiliate of the 
Registrant or beneficial owner of more than 5% of Registrant's outstanding 
securities, or any associate of any such persons, is a party adverse to the 
Registrant or has a material interest adverse to the Registrant, except as 
follows:

	The Company was a third party defendant in a lawsuit commenced on or 
about July 28, 1993 under the caption Joseph W. Grefer v. Paul Anderson, 
individually, and d/b/a Crossroads Commons (New York Supreme Court, County of 
Onondaga). On February 20, 1997, a Decision by the Supreme Court dismissing the 
Paul Anderson third-party action against Advanced Medical Products was made.  
Since then, a Notice of Appeal has been filed, but no preliminary filings have 
been received.


	The Company was a defendant in a lawsuit commenced on August 12, 1994 in 
Court of Common Pleas, State of South Carolina, under the caption Keshlear 
Associates, Inc. v. Advanced Medical Products. On November 7, 1996, both 
parties agreed to resolve the controversy for a total of $18,200.  The Company 
paid the Plaintiff $9,200 at that time and agreed to pay monthly installments 
of $750.  The last payment was made November 7, 1997.

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

	No matter was submitted to a vote of security holders, through the 
solicitation of proxies or otherwise, during the fourth quarter of the fiscal 
year covered by this report.

	PART II


Item 5.	Market for Common Equity and Related Stockholder Matters

	The Registrant's Common Stock, $.01 par value, is traded in the over-the-
counter market and, through February 1, 1995 was quoted on the NASDAQ automated 
quotation system under the symbol "ADVA".  The Company's Common Stock was de-
listed from NASDAQ trading commencing February 2, 1995, due to the Company's 
inability to meet NASDAQ capital and surplus requirements.

	Set forth below is the range of high and low bid information for the 
Registrant's Common Stock for the two preceding fiscal years.  Quotations 
through February 1, 1995 are reported by NASDAQ and reflect closing bid prices. 
 Quotations subsequent to February 1, 1995 are reported from the Pink Sheets 
and reflect daily bid prices.  These quotations represent prices between 
dealers, do not reflect retail mark-up, mark-down or commissions, and may not 
represent actual market transactions.



								High Bid	Low Bid

	Third Calendar Quarter, 1995	       7/16        3/16	

	Fourth Calendar Quarter, 1995	    	  1/2        3/16

	First Calendar Quarter, 1996	    	  7/16         1/4

	Second Calendar Quarter, 1996	   	   1/2         1/4

	Third Calendar Quarter, 1996	        1/2         1/4 

	Fourth Calendar Quarter, 1996        3/4        3/16

	First Calendar Quarter, 1997	       7/16        3/16

	Second Calendar Quarter, 1997	      6/16        2/16


	As of December 31, 1997, there were approximately 1,883 record holders of 
the Registrant's outstanding Common Stock.

	The Registrant has never paid any cash dividends on its Common Stock and 
does not anticipate paying cash dividends on its common stock in the 
foreseeable future, but rather intends to retain earnings, if any, for future 
growth and expansion opportunities.  Payment of cash dividends in the future 
will be dependent upon the Registrant's earnings, financial condition, capital 
requirements and other factors determined to be relevant by the Board of 
Directors.

	Registrant has 4,000 shares of authorized Class A Preferred Stock, no par 
value, of which 2,377 shares are currently issued and outstanding.  Nishimoto 
Sangyo Company, Ltd. ("Nishimoto") owns 2,217 shares, and 160 shares are owned 
by SCANA Corporation.  The Class A Preferred Stock provided that a majority of 
the holders of such shares may require Registrant to redeem all or any portion 
of such shares at any time following the expiration or termination of that 
certain Distribution Agreement between Registrant and Nishimoto, dated 
September 8, 1992, as amended, or in the event of a change of control of 
Registrant of a nature which would be required to be reported in response to 
Item 6(e) of Schedule 14A of the Securities Exchange Act of 1934, as amended.  
Further, Registrant was required to redeem all outstanding shares of the Class 
A Preferred Stock on October 15, 2002.  

	Pursuant to that certain First Amendment to Preferred Stock Purchase 
Agreement between Registrant and Nishimoto, effective as of March 31, 1996 (the 
"Amendment"), Nishimoto assigned to Registrant all rights of redemption, 
mandatory or otherwise, to which Nishimoto was entitled with respect to all or 
any part of the Class A Preferred Stock.  The rights of redemption which were 
assigned, included all demand redemption rights upon the expiration or 
termination of the Distribution Agreement or as of October 15, 2002.          

	Nishimoto further agreed that any transaction which has or may result in 
a change of control of Registrant which is sufficient to entitle it to demand 
redemption rights were waived and are not applicable in the event Carolina 
Medical, Inc. or any of its affiliates, including BIOTEL International, Inc., 
is the party or
parties acquiring control of Registrant.  In any other transaction involving a 
change of control sufficient to result in demand redemption rights to 
Nishimoto, if Nishimoto does not consent to any such change of control, 
Nishimoto will continue to enjoy demand redemption rights with respect to such 
transaction.

	Additionally, Registrant and Nishimoto modified the definition of "change 
of control" for this purpose.  A "change of control" will constitute the 
occurrence of a change in the power to direct the voting rights of greater than 
fifty percent (50%) of each class of outstanding voting shares of capital stock 
of Registrant or the transfer of substantially all of Registrant's assets.  
These modifications were effected solely by contract between Nishimoto and 
Registrant, and have not been incorporated in Registrant's certificate of 
incorporation.

	The terms of the Class A Preferred Stock entitled the holder thereof to 
cash dividends at the rate of $50.00 per annum per share.  Dividends on such 
shares are cumulative.  Such dividends are payable annually in arrears.  The 
dividends payable upon the Class A Preferred Stock for December 31, 1994 and 
December 31, 1995 were not paid to the holder of such shares.  As of March 31, 
1996, the total arrearage was $215,000.  Pursuant to the Amendment with 
Nishimoto, Registrant satisfied the accrued, but unpaid, December 31, 1994 
dividend and interest thereon by the issuance of an additional 113 shares of no 
par preferred stock as an offset to $113,000 of their accrued dividend and 
accumulated interest.  The balance of $102,000 of their accrued dividend and 
interest due December 31, 1995 was converted into 300,000 shares of $0.01 par 
common stock at $0.34 per share as of March 31, 1996 and were issued by 
December 31, 1996.  Nishimoto waived and released any and all claims and causes 
of action against Registrant arising on account of the nonpayment of the 
December 31, 1995 dividend.

	On January 12, 1996 Carolina Medical, Inc., a privately held medical 
device manufacturing company located in King, North Carolina, purchased 750,000 
shares of Advanced Medical Products, Inc.'s authorized but un-issued common 
stock for $150,000. BIOTEL International, Inc., a holding company (which was 
subsequently acquired by Carolina Medical) purchased an additional 1,400,000 
shares of Advanced Medical's common stock on March 29, 1996 for $280,000.  As a 
result of these stock purchases, Carolina Medical beneficially owned an 
aggregate of 2,150,000 shares, or 42.1%, of the Company's common stock. 

	In December 1996, Nishimoto converted $104,000 of their December 31, 1996 
preferred stock dividend into 104 shares of $1,000 face value Preferred Stock 
to bring their total Preferred Stock ownership to 2,217 shares out of 2,377 
shares of Class A Preferred Stock outstanding

	On October 20, 1997 the Company entered into a Stock Purchase Agreement 
with Carolina Medical, Inc., selling an additional 850,000 shares of common 
stock of Advanced Medical Products, Inc. to Carolina Medical, Inc. for 
$263,500.  Of this amount, $183,500 was paid to the Company in November and the 
balance was structured as a note, which was paid by April 30, 1998. This stock 
purchase increased Carolina Medicals ownership in the Company to 3,000,000 
shares or 50.3 percent of the 5,962,496 issued and outstanding common stock 
shares.

	Since December 31, 1997 the Company has been in violation of its 
preferred stock agreements with Nishimoto-Sangyo Company, Ltd. and SCANA 
Corporation, the Company's two preferred stockholders. These two preferred 
stock agreements require that an annual dividend of $50 per $1,000 of the face 
value of the preferred stock be declared and paid at the end of each calendar 
year.  However, the Company had deficits in both retained earnings and 
stockholders equity at December 31, 1997 and therefore under Delaware law 
cannot legally declare a stock dividend. Nishimoto-Sangyo has been unwilling to 
convert unpaid dividends into additional common or preferred shares of Advanced 
Medical, as they have done in prior years, but has indicated a willingness to 
sell their common and preferred stock in the Company in exchange for shares of 
Carolina Medical, Inc.  If that transaction were to be consummated, then 
Carolina Medical would own 55.3% of the common stock and 93.3% of the preferred 
stock of the Company issued and outstanding.   

	The Company believes that internally generated funds, the revolving 
credit agreement with Emergent Financial Group, the loan agreement with 
Carolina Medical, and the cash received from Carolina Medical for the purchase 
of an additional 850,000 shares of common stock, should provide sufficient 
working capital to meet immediate needs, but not sufficient to meet longer term 
working capital requirements. The Company is actively seeking additional 
capital sources to provide long term debt or equity funding. The Company has 
had discussions with Carolina Medical and others regarding possible additional 
investments in the Company, or a possible share exchange.  However there is no 
assurance that existing shareholders will provide the Company with any 
additional funding, or that other sources of funding will be available if and 
when needed.
        
Item 6.  	Management's Discussion and Analysis

	"Management's Discussion and Analysis" of the financial condition and 
results of operations, and other sections of this report contain various 
"forward-looking statements" which represent the Company's expectations 
concerning future events including the following: the Company's future cash 
flows, results of operations and overall financial performance, the expected 
continuing availability of the credit line, the Company's continuing ability to 
sell its Holter and ambulatory blood pressure products to office practices, and 
the Company's belief regarding future recovery from declining revenues in the 
medical device industry.

	Because of the forgoing factors, the actual results achieved by the 
Company in the future may differ materially from the expected results described 
in the forward-looking statements.  The following discussion should be read in 
conjunction with the accompanying Consolidated Financial Statements, including 
the notes thereto, appearing elsewhere herein.      

	
RESULTS OF OPERATIONS

Fiscal 1997 Compared to Fiscal 1996

	Net sales declined 30% to $2,976,847 in fiscal 1997 from $4,232,428 in 
fiscal 1996.  Sales of medical devices to office based physicians in the 
Companys major markets, the U.S., Europe and Japan, have continued to be 
adversely impacted by changes taking place in the health care industry, 
particularly the continuing moves toward managed care and capitation of 
costs.  Many physician practices have been sold to hospitals or managed care 
groups and capital equipment expenditures by health care providers have been 
reduced substantially over the past few years.

	The Companys international sales were down more than domestic sales with 
sales to Nishimoto Sangyo, the Companys distributor in Japan, off more than 
40%. Sales in Germany were also considerably lower due to general economic 
conditions in Germany and reductions in medical procedure reimbursement rates 
implemented in Germany during 1996.  Lower international sales impacted profits 
to a greater degree than lower domestic sales because of the substantially 
lower sales and marketing costs to the Company on international sales.

	Despite lower sales, gross margins were increased from 42% in fiscal 1996 
to 45% in 1997 so that gross profits of $1,333,887 in fiscal 1997 were off by 
$430,565 even though sales were off by $1,255,581.  This was the result of a 
combination of lower inventory write-offs in 1997 and by continuing cost 
reduction measures that reduced fixed overhead expenses.  Emphasis on selling 
products with higher profit margins also contributed positively. 

	Selling, general and administrative expenses of $1,782,301 or 59.9% of 
sales were lower by $869,327 in fiscal 1997, partly due to lower commissions on 
the lower level of sales and partly due to reduced expenditures on marketing, 
lead generation, and salaries.  Selling, general and administrative expenses in 
1996 were 62.7% of a much higher sales level.  Some of the marketing and sales 
cost reductions implemented in fiscal 1997 undoubtedly contributed to lower 
sales in 1997.

	Research and development costs for fiscal 1997 of $205,264 were 7% of 
sales and were lower than in 1996 by $157,836; additional direct costs of 
development of the Windows 95 based Analyst I software product were capitalized 
during both fiscal years. This product is expected to contribute to sales in 
fiscal 1998; the capitalized costs of $90,078 will be expensed over a three 
year expected useful life of the product.

	Interest expense increased from $22,314 in fiscal 1996 to $65,168 in 
fiscal 1997 as a direct result of borrowing against the revolving credit line 
established with Emergent Financial Group during the second quarter of fiscal 
1997.

	The net loss for fiscal 1997 was ($680,912) compared to losses of 
($1,040,418) in fiscal 1996.  Although net losses have been substantially 
reduced in each of the last two fiscal years, cost cutting measures have not 
produced cost savings fast enough to return the Company to profitability in 
light of the steadily declining sales.  Of the $680,912 loss in 1997, $311,729 
of it was reported in the second quarter when the Company wrote off a remaining 
inventory from an unprofitable product line, and incurred expenses in 
connection with relocating to lower cost facilities.  The Company believes that 
fixed costs have now been reduced sufficiently to enable the business to 
operate near break-even at the current level of sales. However, there can be no 
assurance that sales will not continue to decline or that additional cost 
reductions will not be required in order to attain profitability.

	Cash was higher at the end of fiscal 1997 by $36,307.  Inventory was 
reduced during the year by $236,958 to $512,812 by a combination of write-offs 
for discontinued product lines, and continuing efforts to reduce required 
stocking levels. Current assets were lower at June 30, 1997 by $253,467; total 
assets were lower by $297,503.

	Current liabilities were higher at the end of fiscal 1997 by $373,380; 
long term liabilities were lower by $138,066.


Fiscal 1996 Compared to Fiscal 1995

	Net sales decreased 10% to $4,232,428 in fiscal 1996 from $4,684,664 in 
fiscal 1995 following a 29% decline in sales from 1994 to 1995.  These 
decreases were primarily the result of unsettled market conditions in the 
medical device market, and in the health care industry in general, caused by 
governmental and insurance company driven health care reform.  Many of the 
Company's customers, primarily office based physicians, have sold their 
practices to hospitals or managed care groups, or have seen their incomes 
capped, which caused them to delay investing in capital equipment to enhance 
their practices.

	Gross margin decreased from 45% in fiscal 1995 to 42% in fiscal 1996, due 
to the write-offs and reserves totaling $406,000 for obsolete and discontinued 
inventory.  Without these write-offs and reserves, the 1996 gross margin would 
have improved to 51%.

	Selling, general and administrative expense included wages and salaries 
of approximately $748,043 in fiscal 1996 (including the severance package of 
$85,040 for the previous President), and $762,000 in fiscal 1995 with the 
fiscal 1996 decrease attributable primarily to the January 1996 layoffs. The 
overall decrease in selling, general and administrative from $3,561,249 in 
fiscal 1995 to $2,651,628 in fiscal 1996 is primarily due to January layoffs 
and continued efforts to reduce and control costs. 

	The net loss for fiscal 1996 was $(1,040,418), compared to $(1,988,816) 
for fiscal 1995.  Management attributes $800,000 of the 1996 loss to the write-
off of and reserves against manufacturing inventory of $406,000, write-offs of 
$115,332 of previously capitalized engineering prototype inventory, $194,933 of 
bad debts from prior periods, and the severance package of $85,040 for the 
Company's previous President. The remaining loss of $240,000 was the result of 
disproportionate operating expenses during the first half of the fiscal year 
which were substantially reduced during the third and fourth quarters.  The 
Company generated $43,000 in profit from operations, prior to write-offs and 
reserves, during the fourth quarter of fiscal 1996.

	Accounts receivable decreased from $643,153 in June 30, 1995 to $547,441 
at June 30, 1996.  The decrease resulted from decreased revenues and efforts to 
expedite collections.

	Inventory decreased from $1,208,358 at June 30, 1995 to $749,770 at June 
30, 1996.  The decrease resulted from efforts to reduce purchases and from 
write-offs of certain obsolete inventory and reserves for discontinued product 
lines.

	Other current assets decreased from $256,678 in fiscal 1995 to $117,095 
in fiscal 1996.  The decrease is primarily due to the expensing of an un-
collectible note receivable and the elimination of lease deposits as a result 
of debt restructuring.

	Accrued wages and commissions increased from $93,287 in fiscal 1995 to 
$121,014 in fiscal 1996.  The increase results from a change to semi-monthly 
from bi-weekly payroll.

	Research and development costs for fiscal 1996 were approximately 
$363,000 compared to approximately $451,000 in fiscal 1995.  The fiscal 1996 
expenses include $115,000 resulting from write-offs of prototype inventory 
charged to engineering development.  The decrease is due to the reassignment of 
certain engineering personnel.  

LIQUIDITY AND CAPITAL RESOURCES

	Operating activities used $405,790 of cash during fiscal 1997 compared 
with $309,453 used during fiscal 1996.  In fiscal 1997, 
$103,910 was used for capital expenditures compared with $90,459 in fiscal 
1996.  Cash increased by $36,307 in 1997 and decreased by $17,480 in 1996.

	On October 21, 1996, the Company entered into an asset based credit 
agreement with Emergent Financial Corporation of Greenville, South Carolina.  
Under this agreement, the Company may borrow 80 percent of eligible accounts 
receivable (as defined in the agreement) and 30 percent of eligible inventory 
(as defined in the agreement) up to a total loan balance of $750,000.  Interest 
is calculated at an annual percentage rate of Prime plus 2% as defined by 
NationsBank of Georgia, N.A., plus additional monthly fees of .75% of the 
average daily balance outstanding.

	As of October 31, 1996, the Company was released from a fifteen-year 
lease with SCANA that represented a future long-term lease liability of 
$1,676,272.  The payments under the lease annualized were $156,000 and were 
scheduled to escalate over the remaining term of the lease.  SCANA received 160 
shares of the Companys Class A Preferred Stock as payment in full of the 
delinquent lease payments of approximately $160,000.
	
	On June 1, 1996, the Company restructured five operating leases with 
Syracuse Supply Company of Syracuse, New York into one short-term note.  The 
note was repaid in 12 monthly installments of $913, accrued interest at 11 
percent and was secured by equipment, furniture and fixtures.

	On March 12, 1996 the Company restructured eight operating leases and 
it's short-term note with Onbank of Syracuse, New York into one long-term note. 
 The note will be repaid in 48 monthly installments of $2,000, accrued interest 
at 11 percent, and is secured by furniture, fixtures, and equipment.  The 
balance as of  June 30, 1997 was $58,731.

	During fiscal 1996 the Company was released from a factoring agreement 
with Cambridge Capital Management, Inc. of Boca Raton, Florida and entered into 
a new factoring agreement with Global Acceptance Corporation of Detroit, 
Michigan ("Global") pursuant to which Global has agreed to advance 75% (less 
$100) of the Company's eligible accounts receivable.  However, in October of 
1996 the Company was released from the factoring agreement with Global and 
entered into an asset based credit agreement with Emergent Financial (see 
above).

	In January 1996 the Company sold to Carolina Medical, Inc.,
750,000 shares of Advanced Medical's authorized but un-issued common stock for 
$150,000 cash.  On March 29, 1996 BioTel International, Inc., a holding company 
that owned a majority interest in Carolina Medical's common stock purchased an 
additional 1,400,000 shares of Advanced Medical's common stock for $280,000.  
These transactions provided $430,000 of cash for working capital purposes.  

	On July 1, 1996, the Company entered into a loan agreement with Carolina 
Medical, the Companys largest shareholder, under which the Company borrowed 
$150,000 at 12 percent annual rate of interest.  The balance on this note as of 
June 30, 1997, including interest due, was $159,482.

	During the years ended June 30, 1997 and 1996 the Companys net losses 
were approximately $681,000 and $1,040,000.  As of June 30, 1997, the 
Companys accumulated deficit in earnings was approximately $4,772,000.  In 
addition, the Company was in violation of loan covenants on its credit line 
with Emergent Financial, and a number of vendors have placed the Company on 
cash on delivery terms.  The Company's independent auditors have provided a 
"going concern" opinion regarding the future operations of the Company.  
Management is aggressively addressing these matters by reviewing the current 
operations of the Company and reducing operating costs wherever possible, 
while developing new products to meet the demands of the changing medical 
device market. In January 1996, in an effort to cut and control operating 
costs, the Company laid off 20 of its non-key personnel and terminated certain 
programs such as its performance bonus plan, guaranteed commission to new 
sales personnel, and auto allowances.  During 1997, the number of employees 
was further reduced from 32 to 16.  The Company has been under a general wage 
and hiring freeze.  Manufacturing of the Companys products has been 
contracted out wherever possible to reduce manufacturing overhead and improve 
cash.  Management continues to closely monitor sales, gross margins and 
operating expenses, making adjustments where necessary to become profitable.  

	The Company has continued to invest in technology development, 
specifically the development of "Windows 95" software for processing Holter 
and blood pressure data, and for the transmission of cardiac data as FTP files 
over the Internet. Management believes these developments enhance the 
Company's future business opportunities. 

	On October 20, 1997, the Company entered into a Stock Purchase Agreement 
with Carolina Medical to sell an additional 850,000 shares of its common stock 
for $263,500.  Cash of $183,500 was paid to the Company by November 10, 1997, 
and the balance was paid by April 30, 1998.  This stock purchase increased 
Carolina Medicals ownership in the Company to 50.3% of the issued and 
outstanding common stock.  	The Company believes that internally generated 
funds, the revolving credit agreement with Emergent Financial Group, the loan 
agreement with Carolina Medical, and the cash received from Carolina Medical 
for the purchase of an additional 850,000 shares of common stock, should 
provide sufficient working capital to meet immediate needs but not sufficient 
to meet longer term working capital requirements. The Company is actively 
seeking additional capital sources to provide long term debt or equity funding. 
The Company has had discussions with Carolina Medical and others regarding 
possible additional investments in the Company, or a possible share exchange.  
However there is no assurance that existing shareholders will provide the 
Company with any additional funding, or that other sources of funding will be 
available if and when needed.  The Company does not have any current plans for 
major capital expenditures in fiscal 1998. 

	The ability of automated systems to recognize the date change from 
December 31, 1999 to January 1, 2000 is commonly referred to as the Year 2000 
matter.  Similar to most other organizations, the Company has assessed the 
potential impact of the Year 2000 matter on its operations based on current and 
foreseeable computer and other automated system applications.  The Company 
believes and future costs associated with modifying its computer software and 
other automated systems for the year 2000 matter will not be material.


Item 7.  Financial Statements

	Financial information required by this Item is attached to this Report 
beginning on page F-1.  See also Item 13.

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

	Information with respect to changes in accountants during the 
Registrant's two most recent fiscal years or in any subsequent interim period 
has been "previously reported" (within the meaning of Rule 12b-2) and, 
accordingly, is not disclosed hereunder.





	PART III


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

	The current directors and executive officers of the Registrant are as 
follows:

		     Name			          Age    Position and Term of Service

	L. John Ankney          68	    Director since January 1996
 
	James H. Brown 		       49	    Director since September 1986, 

	George L. Down		        57	    President since October 1997. 
						                          Vice President since April 1996.
						                          Director since September 1986

	David A. Heiden         49	    Director since January 1996
 
	C. Roger Jones          57	    Director since January 1996

	Ronald G. Moyer         62	    Chief Executive Officer, Treas-
                 					          User and Chairman of the Board
                                Since January 1996; President
                                From January 1996-October 1997.

 Deborah Riente		        42	    Vice President since December 
                                1993 and Secretary since August 1992

	L. John Ankney served as President and Director from 1970 to 1993 for 
Transnational Electronic and Funding Corporation, an investment, venture 
capital, and management consulting company.  From 1968 to 1970 he was Senior 
Vice President at Computer Leasing Company, and prior to that time he was 
President and Director for Holland Associates.  Mr. Ankney served as a director 
of Digilog, Inc. from 1974 to 1989.

	James H. Brown is a technology and strategy consultant to the Company, 
and a Director of the Company and currently supervises the Company's product 
development activities, and provides technical support to the Companys 
international dealers and OEM customers.  Mr. Brown received his Master of 
Science degree in electrical engineering from Polytechnic Institute of New York 
in 1975 and a Bachelor of Science degree in physics from Georgia Tech in 1970. 
 Mr. Brown devotes his full-time to the business of the Company.

	George L. Down is President and a Director of the Company and currently 
oversees the Company's operations.  Prior to his appointment to the position as 
President in October 1997, Mr. Down was Vice President of Sales and Marketing 
for the Company.  Until December 1992, and for more than the preceding five 
years, he served as the president of Design Realizations, Ltd. ("DRL"), a 
closely held corporation founded by Mr. Down, where he performed design and 
packaging services for a variety of companies, including the Company.  Mr. Down 
received a Bachelor of Science in Industrial Design degree from Syracuse 
University in 1964.  Mr. Down devotes his full time to the affairs of the 
Company.

	David A. Heiden, is President and CEO of Urological Care America, Inc., a 
company focused on enhancing the practice of urology in the managed care 
environment.  He served as President and CEO of Lithotripter Technologies of 
the Americas from 1985 to 1988.  Prior to that he was Vice President of 
Marketing and Sales for Dornier Medical Systems.

	C. Roger Jones, has served as President and Chief Operating Officer of 
Carolina Medical since 1985.  From 1970 to 1985, he was Vice President of Sales 
& Marketing.  He has been with Carolina Medical since 1961.  He has served as 
Chairman for Eagle Golf Ball Company, Inc. since 1988.

	Ronald G. Moyer is the Chief Executive Officer, Treasurer and Chairman of 
the Board of the Company, and from January 1996 until October 1997, he served 
as President of the Company.  Since 1992 he has been the Chief Executive 
Officer and Chairman of Carolina Medical Inc., a manufacturer of medical 
instruments.  From 1991 to 1992 he served as Director of Mergers and 
Acquisitions for Dominion Holdings Group, a Merchant Bank.  From 1989 to 1991 
he served as Executive Vice President and Chief Operating Officer of CXR 
Corporation, an AMEX listed company.  Prior to that time since 1969 he was the 
President, Chief Executive Officer and Chairman of the Board of Digilog, Inc., 
a NASDAQ listed public company.  He received an MS in Aerospace Engineering 
from Drexel University in 1963 and completed the Harvard Business School Small 
Corporation Management Program in 1981.

	Deborah Riente serves as Vice President of Corporate Administration.  
From July 1991 until July 1992, Ms. Riente was employed as the Company's Human 
Resources Manager, and from 1987 to July 1991, served as an administrative 
assistant for the Company.  Ms. Riente devotes her full-time to the business of 
the Company.

	The Company's Board of Directors is comprised of Messrs. Moyer, Ankney, 
Brown, Down, Heiden and Jones.  The term of office of each Director commences 
on the date of the Company's Annual Meeting of Stockholders, and continues for 
one year thereafter, or until his successor is duly elected and qualified.  The 
Company does not compensate its Directors for serving as such, but are and will 
be reimbursed for their reasonable out-of-pocket expenses incurred in their 
capacities as members of the Board of Directors.

Item 10.  Executive Compensation

	The following table discloses certain summary information concerning the 
compensation paid for services rendered in all capacities to the Company for 
the two fiscal years in the period ended June 30, 1997, to the Company's Chief 
Executive Officer and its four most highly compensated executive officers other 
than the Chief Executive Officer, whose total annual salary and bonus were in 
excess of $100,000 (each, a "Named Executive Officer"):

	SUMMARY COMPENSATION TABLE


														   Long-Term
										      			   Compensation
                        Annual Compensation                       Awards    

								
Name				Fiscal						   Other			   			All Other
and				Year							   Annual 				   		Compensa-
Principal			Ended			Salary	Bonus		Compensation	  	Options	    	   tion
Position 			June 30		  ($)  	 ($)  	   ($)      	   	  (#)   	 	   ($)   

Clarence P. Groff(1)   1996      72,810     -0-      -0-      -0-   150,579(A)
 Former Chief    	       
 Executive Officer	
 
Ronald G. Moyer        1997         84,000     -0-       -0-       -0-    -0- 
  Chief Executive      1996         39,367     -0-       -0-       -0-    -0-  
  Officer
______________________

(A)	Amounts reported reflect the dollar value of the following:



						Employer
						Contributions	    
Named Executive		Under Profit	Severance	Car		Performance  Interest Fre	  Debt  
   Officer    		Year		Sharing Plan 	Package  	Allowance	Plan            Loan   
Forgiveness

Clarence P. Groff		1996         -0-       85,040       539       -0-    65,000

				
				


(1)  Resigned as Chief Executive Officer effective January 12, 1996
(2)  Elected Chief Executive Officer effective January 25, 1996

There were no grants of stock options during the fiscal year ended June 30, 
1997 to the Named Executive Officer.

The following table sets forth information concerning each exercise of stock 
options during the fiscal year ended June 30, 1997 by the Named Executive 
Officer and the value of unexercised options held by the Named Executive Officer
as of June 30, 1997:



	Aggregated Option Exercises in Fiscal 1997 and Fiscal Year-End Option Values


																	Value of
												Number of				Unexercised
												Unexercised				In-the-Money
												Options				Options
												at FY-End (#)			at FY-End ($)

				Shares Acquired		Value Real-			Exercisable/			Exercisable/
Name				on Exercise (#)		ized (A) ($)		Unexercisable (C)			Unexercisable(B)

Ronald G. Moyer             -0-            -0-               -0-         -0-  
 Chief Executive
 Officer
_____________________
(A)	Market value of securities underlying options on the exercise date, less 
the exercise price of such options.

(B)	Market value of securities underlying "in the money" options at June 30, 
1997, less the exercise price of such 
options.

Employment Agreements

	Effective July 1, 1992, the Company entered into executive employment 
agreements with Clarence P. Groff and James H. Brown.  Effective January 1, 
1993, the Company entered into an employment agreement with George L. Down.

	As of the year ended June 30, 1995 and continuing until January 26, 1996, 
these employment agreements were in effect.  However, coincident with the 
investment by Carolina Medical, and the resulting changes in ownership, all 
employment agreements have been terminated.  There were no employment 
agreements in effect on June 30, 1996 or June 30, 1997.

Performance Plan

	The Company instituted a Quarterly Performance and Salary Adjustment Plan 
(the "Performance Plan") for key management and administrative personnel.  
Pursuant to the Performance Plan, each eligible employee's salary was reviewed 
on a quarterly basis and could be increased, up to a maximum of 25% of base 
salary, in accordance with a formula based upon achieving certain objectives 
and goals previously agreed to by the Company and the employee.  For fiscal 
year ended June 30, 1996, the Company paid an aggregate of $32,117 to non-
officer employees and an aggregate of $23,235 to officers of the Company 
pursuant to the Performance Plan.   Effective January 19, 1996, this plan was 
terminated.

Section 401(k) Plan

	During fiscal 1993, the Company's Board of Directors established a 
defined contribution profit sharing plan pursuant to Section 401(k) of the Code 
[the "401(k) Plan"].  The 401(k) Plan is administered by F.P. Kessler, Jr. and 
Associates, of East Syracuse, New York, in conjunction with The New England of 
Boston, Massachusetts.  The 401(k) Plan permits eligible employees to make 
voluntary contributions to the 401(k) Plan up to an annual maximum dollar 
amount of $9,500 for the calendar year 1997.  The Company may contribute a 
discretionary matching contribution on the basis of a $.25 contribution by the 
Company for each $1.00 contribution by the employee, up to a maximum of 4% of 
the aggregate employee contribution.  Benefits under the 401(k) Plan are to be 
distributed upon retirement, disability, death or termination of employment.  
Each participant's share of the Company's contribution vests beginning after 
three full years of service, at the rate of 20% after each of the third through 
seventh years of service, at which time the participant becomes fully vested.  
During the fiscal year the Company made no matching contributions pursuant to 
the 401(k) Plan.  Amounts to be contributed by the Company under the 401(k) 
Plan are discretionary, and, accordingly, 

it is not possible to estimate the amount of benefits that will be payable to 
participants upon retirement.

Limitation on Liability of Directors; Indemnification

	The Company's Certificate of Incorporation provides that a director of 
the Company will not be personally liable to the Company or its shareholders 
for monetary damages for breach of the fiduciary duty of care as a director, 
including breaches which constitute gross negligence.  However, this provision 
does not eliminate or limit the liability of a director of the Company (i) for 
breach of the director's duty of loyalty to the Company or its shareholders, 
(ii) for acts or omissions not in good faith or which involve intentional 
misconduct or a knowing violation of law, (iii) under Section 174 of the 
Delaware General Corporation Law (relating to unlawful payment of dividends or 
unlawful stock repurchases or redemptions), (iv) for gaining a financial profit 
of other personal advantage to which he  or she was not entitled, or (v) for 
breaches of a director's responsibilities under the Federal securities laws.  

	The Company's by-laws provide that the Company shall indemnify its 
officers, directors, employees and agents, to the extent permitted by the 
General Corporation Law of Delaware.

Stock Option Plan

	On January 26, 1987, the Board of Directors of the Company adopted a 
Stock Option Plan pursuant to Section 422A (now renumbered Section 422) of the 
Internal Revenue Code of 1986 (the "Code").  The Stock Option Plan was amended 
on April 10, 1987, and was amended and restated on November 6, 1992.  The 
amended and restated Stock Option Plan (the "Plan") was approved by the 
Stockholders on December 16, 1992.

	A description of the Plan is set forth below.  Such description is 
qualified in its entirety by reference to the full text of the Plan, a copy of 
which is available upon written request to the Company.

	The Plan has two administration groups, one for non-qualified and one for 
qualified stock options.  Non-qualified Stock Option Committee members are Mr. 
Moyer, Mr. Brown and Mr. Down.  Qualified Stock Option Committee members are 
Mr. Moyer, Mr. Ankney and Mr. Heiden.  Unless otherwise approved by the 
Company's stockholders, members of the Committee are eligible to receive 
options only pursuant to Section 5(b) of the Plan, which establishes a formula 
for the exercise of such options.  Options granted under the Plan may be 
qualified (incentive options within the meaning of Section 422 of the Code) or 
non-qualified.  Stock purchased pursuant to the exercise of an incentive option 
is subject to repurchase by the Company at the option price thereof in the 
event of the termination of employment for any reason of such option-
ee/purchaser within one year of the exercise of such option.  Pursuant to Stock 
Option Agreements between the Company and optionees of incentive options 
granted under the Plan, the Company has a right of first refusal to purchase 
shares issued upon the exercise of options during the five year period 
commencing on the date of exercise.  The maximum term of any option under the 
Plan is ten years and the per share option price of incentive options may not 
be less than 100% of the fair market value of the Company's Common Stock on the 
date the incentive option is granted.  However, incentive stock options granted 
to persons owning more than 10% of the voting Common Stock of the Company may 
not have a term in excess of five years or an option price per share less than 
110% of the fair market value of the Common Stock on the date of the grant.

	Subject to the foregoing, each Committee determines who shall have 
options under the Plan, the number of shares of Common Stock that may be 
purchased under each option, the option exercise price and the term of each 
option.  The Committee may impose additional restrictions and limitations on 
the rights of optionees, consistent with the Plan.  In the event the Company's 
Common Stock is not publicly traded at the time of grant of the option, the 
Committee shall make a good faith determination of fair market value.  Options 
shall be exercisable at such times and in such amounts as the Committee 
determines upon the granting thereof.  Except as otherwise set forth, 
information set forth herein concerning options refers to both qualified and 
non-qualified options.  Decisions of the Committee are final.

	Options granted under the Plan are not transferable other than by will or 
by the laws of descent and distribution.  A total of 750,000 shares may be 
issued upon exercise of options granted under the Plan.  The Plan will 
terminate on November 5, 2002, or on such earlier date as the Board of 
Directors may determine.  Any option outstanding at the termination date will 
remain outstanding until it expires or is exercised in full, whichever first 
occurs.

	As of June 30, 1997, options to purchase 335,500 shares of Common Stock 
under the Plan were outstanding.  These options are exercisable at prices 
ranging from $.25 to $1.63 per share and expire at various dates through April 
2000.  During fiscal 1997, options to purchase 275,000 shares were granted, no 
options were exercised, and options to purchase an aggregate of 54,850 shares 
were terminated in accordance with the terms of the options.    

	Compensation Committee

		During the fiscal year ended June 30, 1996, the Company initiated 
a Compensation Committee of outside directors.  Mr. Ankney is Chairman and 
Mr. Heiden is a member.  The Compensation Committee administers the Company's 
salary, cash bonus, qualified stock option plan and other compensation plans 
for the Company's employees and officers.  

	Item 11.	Security Ownership of Certain Beneficial Owners and Management

	The following table sets forth, as of December 31, 1997 certain information 
concerning beneficial ownership of the Company's Common Stock by (i) each 
person known to the Company to own 5% or more of the Company's Common Stock, 
(ii) each director of the Company and (iii) all directors and officers of the 
Company as a group.

 				        	              Amount and Nature	        	    Percent of
	Name and Address	   	   of Beneficial Ownership (1) 	     Class (2)


	Ronald G. Moyer                   3,000,000 (3)                   50.31
	6 Woodcross Drive
	Columbia, SC 29212

	Carolina Medical Inc.		           3,000,000 (3)		                 50.31
	157 Industrial Drive
	King, NC 27021

	Clarence P. Groff                   576,666                        9.67
	231 N. Woodlake Dr.
	Columbia, SC 29223

	Nishimoto Sangyo Co., Ltd.          300,000                        5.03
	2-17-4 Yushima, Bunkyo-Ku
	Tokyo, Japan

	George L. Down                      216,766 (4)                    3.64
	6 Woodcross Drive
	Columbia, SC 29212

	James H. Brown			                   182,058 (5)                    3.05
	6 Woodcross Drive
	Columbia, SC 29212

	Officers and Directors as         3,577,248 (3),(4)               60.00
 	a Group (of 4 persons)        	(5),(6),(7)

                           
(1)  As used herein, the term beneficial ownership with respect to a security 
is defined by Rule 13d-3 under the Securities Exchange Act of 1934 as 
consisting of sole or shared voting power (including the power to vote or 
direct the vote) and/or sole or shared investment power (including the power to 
dispose or direct the disposition of) with respect to the security through any 
contract, arrangement, understanding, relationship or otherwise, including a 
right to acquire such power(s) during the next 60 days.

(2)  Does not give effect to the issuance of up to 115,000 shares in the event 
of exercise of outstanding qualified and non-qualified stock options (except to 
the extent Securities and Exchange Commission rules require the table to give 
effect to the issuance of such shares).

(3)  Ronald G. Moyer as Chairman and controlling shareholder of Carolina 
Medical may be deemed to be beneficial owner of shares owned by both Carolina 
Medical by virtue of his control over the voting power of those shares.  Also, 
C. Roger Jones as President and Director of Carolina Medical, may be deemed to 
be beneficial owner of the shares owned by Carolina Medical Inc. by virtue of 
his control over the voting power of those shares.  (See "Description of 
Business".

(4)  Includes (i) 14,976 shares owned of record by the Helen L. Down Trust 
(Helen Down is the mother of Mr. Down), for which Mr. Down serves as trustee 
and (ii) 19,576 shares owned of record by members of Mr. Down's family, which 
shares are subject to voting proxies held by Mr. Down and (iii) includes 20,000 
shares issuable in the event of exercise of currently exercisable stock 
options.

(5)  Includes 21,000 shares issuable in the event of exercise of currently 
exercisable stock options.  Also includes (i) 2,342 shares owned of record by 
the spouse of Mr. Brown and (ii) 11,900 shares owned of record by Mr. Brown's 
sister-in-law, which shares are subject to a voting proxy held by Mr. Brown.

(6)  Includes 52,924 shares beneficially owned by the Secretary of the Company 
and 80,500 shares issuable in the event of exercise of currently exercisable 
stock options granted to such officer.

(7)  Includes 45,000 shares issuable in the event of exercise of currently 
exercisable stock options granted to directors.

Item 12.  Certain Relationships and Related Transactions

	Effective September 13, 1989, the Company reverse split its outstanding 
Common Stock at the rate of 1:100 and amended its Certificate of Incorporation 
so as to (i) reduce the number of shares of Common Stock the Company is 
authorized to issue from 500,000,000 to 5,000,000 and (ii) increase the par 
value of each such share from $.0001 to $.01.  All references to shares and per 
share date in this Report give retroactive effect to such reverse split and re-
capitalization.  In October 1992, the Company amended its Certificate of 
Incorporation so as to authorize 4,000 shares of redeemable Class A Preferred 
Stock, and in 1996 the Company increased its authorized common stock to 
7,000,000 shares.

	Pursuant to a Voting Trust Agreement, Clarence P. Groff was granted the 
right to vote 357,200 shares of the Company's Common Stock owned by Dr. Steven 
Berkowitz (a parent and promoter of the Company) or his transferees, until the 
earlier of (i) October 24, 1996 or (ii) Mr. Groff's sale of all of his shares 
in the Company. During the 1993 fiscal year, 7,500 shares issued to the 
Company's Secretary were made subject to the provisions of the Voting Trust 
Agreement.  The Voting Trust was terminated on September 27, 1996.


	On January 12, 1996, Clarence P. Groff, the Company's former largest 
stockholder resigned as President, Chief Executive Officer, Principal 
Accounting Officer, Chief Financial Officer, and Chairman of the Board.  At 
that time Mr. Groff entered into a termination arrangement with the Company 
whereby he agreed to waive his rights and terminate a prior employment 
agreement and the Company agreed to pay Mr. Groff $4,368.86 every two (2) weeks 
beginning February 2, 1996 and ending December 20, 1996 for the following:

     Severance Pay                 $75,000
     Back Pay                       11,649
     50% of Accrued Car Allowance    4,125
     Vacation Pay                   10,040
     Un-reimbursed Expenses          4,039

	On March 31, 1996 the Company repaid a loan from Mr. Groff
in the principal amount of $9,375 plus interest at 9% APR of $751 as stipulated 
in the above mentioned termination agreement.

	Also as part the agreement, the Company agreed to indemnify
Mr. Groff for actions as an officer, director, employee, and agent of the 
Company to the fullest extent permitted under the General Corporation Law of 
Delaware.  In consideration of the above, Mr. Groff agreed to a Confidentiality 
and Non-Disclosure; Non-Compete; No Recruiting Covenant.                 

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

(a)	The following Exhibits are filed as part of this Report:

    3.1	Articles of Incorporation, as amended(1)

    3.2	By-Laws(2)

    4.1	Specimen Common Stock Certificate(3)

    9.1	Voting Trust Agreement(7)

   10.1	Employment Agreement with Clarence P. Groff(4)*

   10.2	Employment Agreement with James H. Brown(5)*
        
   10.3  	Employment Agreement with George L. Down(6)*

   10.5	Advanced Medical Products Stock Option Plan(8)
 
   10.6	Preferred Stock Purchase Agreement with Nishimoto Sangyo Company, 
Ltd.(9)

   10.7	Lease with South Carolina Real Estate Development Company, Inc.(10)

10.8 License Agreement with HealthWatch Technologies,
Inc. (11)

   10.9	Distribution Agreement with Nishimoto Sangyo Company, Ltd.(12)

   10.10	Agreement for Manufacture of ULTRA PVD?(13)

   10.11	Advanced Medical Products 401(k) Plan(14)

   10.12	OEM/Distribution Agreement with Kontron Instruments Ltd.(15)

   10.13	Distribution Agreement with AMP International, Inc.

10.14 OEM/Distribution Agreement with Multispiro Inc.

   10.15 	Intellectual Property License Agreement with Carolina Medical, Inc. 
(16)

   10.16  Subscription Agreement with Carolina Medical, Inc. (17)

   10.17	First Amendment to Subscription Agreement with Carolina Medical, 
Inc. (18)

   10.18  Termination Agreement with Clarence P. Groff (19)

   10.19  Termination Agreement with James H. Brown (20)

   10.20  Termination Agreement with George L. Down (21)

   10.21  First Amendment to Preferred Stock Purchase 
	     Agreement with Nishimoto Sangyo Company, Ltd. (22)

   10.22  Amendment to Distribution Agreement with Nishimoto 
	     Sangyo Company, Ltd. (23)

   10.23  Preferred Stock Purchase Agreement with Scana 
	     Development Corporation. (24)

10.24   Lease with T & L A Partnership. (25)

   10.25  Subscription Agreement with BIOTEL International Inc.

                   
(1)	Reference is made to Exhibit 7(a) to the Registrant's Report on Form 8-K 
dated October 14, 1992, which is hereby incorporated by reference.

(2)	Reference is made to Exhibit 3.1 to the Registrant's Report on Form 10-Q 
for the quarter ended December 31, 1988, which is hereby incorporated by 
reference.

(3)	Reference is made to Exhibit 4.1 to the Registrant's Report on Form 10-K 
for the year ended June 30, 1989, which is hereby incorporated by reference.

(4)	Reference is made to Exhibit 10.1 to the Registrant's Report on Form 10-K 
for the year ended June 30, 1992, which is hereby incorporated by reference.

(5)	Reference is made to Exhibit 10.2 to the Registrant's Report on Form 10-K 
for the year ended June 30, 1992, which is hereby incorporated by reference.

(6)	Reference is made to Exhibit 10.3 to the Registrant's Report on Form 10-K 
for the year ended July 2, 1993, which is hereby incorporated by reference.

(7)	Reference is made to Exhibit 10.4 to the Registrant's Form S-18 
Registration Statement (File No. 33-12559-NY) as filed on March 10, 1987, which 
is hereby incorporated by reference.

(8)	Reference is made to Exhibit 10.5 to the Registrant's Report on Form 10-K 
for the year ended July 2, 1993, which is hereby incorporated by reference.

(9)	Reference is made to Exhibit 7(a) to the Registrant's Report on Form 8-K 
dated September 18, 1992, which is hereby incorporated by reference.

(10)	Reference is made to Exhibit 7(a) to the Registrant's Report on Form 8-K 
dated October 7, 1992, which is hereby incorporated by reference.

(11)	Reference is made to Exhibit 10.9 to the Registrant's Report on Form 10-K 
for the year ended June 30, 1992, which is hereby incorporated by reference.

(12)	Reference is made to Exhibit 7(c) to the Registrant's Report on Form 8-K 
dated September 18, 1992, which is hereby incorporated by reference.

(13)	Reference is made to Exhibit 10.13 to the Registrant's Report on Form 10-
K for the year ended June 30, 1991, which is hereby incorporated by reference.

(14)	Reference is made to Exhibit 10.12 to the Registrant's Report on Form 10-
K for the year ended July 2, 1993, which is hereby incorporated by reference.

(15)	Reference is made to Exhibit 10.13 to the Registrant's Report on Form 10-
K for the year ended July 1, 1994, which is hereby incorporated by reference.

(16) Reference is made to Exhibit 10.15 to the Registrant's Report on Form 8-K 
dated January 12, 1996, which is hereby incorporated by reference.

(17) Reference is made to Exhibit 10.16 to the Registrant's Report on Form 8-K 
dated January 12, 1996, which is hereby incorporated by reference.

(18) Reference is made to Exhibit 10.17 to the Registrant's Report on Form 10-
KSB for the year ended June 30, 1996, which is hereby incorporated by 
reference.

(19) Reference is made to Exhibit 10.18 to the Registrant's Report on Form 10-
KSB for the year ended June 30, 1996, which is hereby incorporated by 
reference.

(20) Reference is made to Exhibit 10.19 to the Registrant's Report on Form 10-
KSB for the year ended June 30, 1996, which is hereby incorporated by 
reference.

(21) Reference is made to Exhibit 10.20 to the Registrant's Report on Form 10-
KSB for the year ended June 30, 1996, which is hereby incorporated by 
reference.

(22) Reference is made to Exhibit 10.21 to the Registrant's Report on Form 10-
KSB for the year ended June 30, 1996, which is hereby incorporated by 
reference.

(23) Reference is made to Exhibit 10.22 to the Registrant's Report on Form 10-
KSB for the year ended June 30, 1996, which is hereby incorporated by 
reference.

(24) Reference is made to Exhibit 10.23 to the Registrant's Report on Form 10-
KSB for the year ended June 30, 1996, which is hereby incorporated by 
reference.

(25) Reference is made to Exhibit 10.24 to the Registrant's Report on Form 10-
KSB for the year ended June 30, 1996, which is hereby incorporated by 
reference.

(26) Reference is made to Exhibit 10.25 to the Registrants Report on Form 10-
KSB for the year ended June 30, 1997, which is hereby incorporated by 
reference.

*	Management contract/compensatory plan.



(b)	Reports on Form 8-K:

	No Reports on Form 8-K were filed during the last quarter of the period 
covered by this Report.




	SIGNATURES


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

							ADVANCED MEDICAL PRODUCTS INC.



							By:/s/ Ronald G. Moyer         	
							    Ronald G. Moyer, CEO

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


	  Name				 Title				    Date

/s/Ronald G. Moyer    CEO, Treasurer, and 	            5/18/98
Ronald G. Moyer       Chairman of the Board 
                 				 (Principle Executive Officer
				                  and Principle Financial Officer)

/s/James H. Brown	    Director					                    5/18/98
James H. Brown 	 	 

/s/George L. Down	    President and Director		         5/18/98
George L. Down

/s/C. Roger Jones	    Director                         5/18/98
C. Roger Jones

/s/L. John Ankney	    Director                         5/18/98
L. John Ankney

/s/David Heiden       Director                         5/18/98
David Heiden


	The Registrant has not furnished its 1997 annual report or proxy materials to 
securities holders.  The Registrant intends to furnish such information to 
security holders, and to furnish copies thereof to the Commission, in accordance
with applicable rules and regulations.


	SIGNATURES



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

							ADVANCED MEDICAL PRODUCTS INC.



				By:                        		
				     Ronald G. Moyer, CEO


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


	  Name				                    Title				                   Date

                       CEO, Treasurer and  
Ronald G. Moyer  	     Chairman of the Board
				                   (Principle Executive Officer and
				                   Principle Financial Officer)

                 	     Director
James H. Brown 	       

                 	     President and Director
George L. Down

                 	     Director	
C. Roger Jones

                 	     Director
L. John Ankney

                 	     Director
David Heiden


	The Registrant has not furnished its 1997 annual report or proxy 
materials to securities holders.  The Registrant intends to furnish such 
information to security holders, and to furnish copies thereof to the 
Commission, in accordance with applicable rules and regulations.






	
	Advanced Medical Products Inc.
	







Financial Statements
Years Ended June 30, 1997 and 1996












	
	Advanced Medical Products Inc.
	







Financial Statements
Years Ended June 30, 1997 and 1996




Report of Independent Certified Public Accountants	F-3


Financial Statements

   Balance Sheets	F-4F-5

   Statements of Loss 	F-6

   Statements of Changes in Stockholders Equity (Deficit)	F-7

   Statements of Cash Flows	F-8F-9

   Summary of Significant Accounting Policies	F-10F-13

   Notes to Financial Statements	F-14F-24







Report of Independent Certified Public Accountants



To the Board of Directors and Stockholders
Advanced Medical Products Inc.
Columbia, South Carolina


We have audited the accompanying balance sheets of Advanced Medical 
Products Inc. as of June 30, 1997 and 1996, and the related statements 
of loss, changes in stockholders equity (deficit), and cash flows for 
the years then ended.  These financial statements are the responsibility 
of the Companys 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 financial position of Advanced 
Medical Products Inc. at June 30, 1997 and 1996, and the results of its 
operations and its cash flows for the years then ended in conformity 
with generally accepted accounting principles.

The accompanying financial statements have been prepared assuming that 
the Company will continue as a going concern.  As discussed in Note 1 to 
the financial statements, the Company has suffered recurring losses from 
operations and has a net capital deficiency that raises substantial 
doubt about its ability to continue as a going concern.  Managements 
plans in regard to these matters are also described in Note 1.  The 
financial statements do not include any adjustments that might result 
from the outcome of this uncertainty.





Charlotte, North Carolina	BDO Seidman, LLP
December 11, 1997, except
for Note 18 which is 
dated as of April 28, 1998


June 30,                                     		          1997        		1996

Assets

Current:

  Cash                                               	$	50,938     	$	14,631
  Accounts receivable, net (Notes 2, 6, and 7)         554,552       547,441
  Inventories (Notes 3 and 7)                          512,812       749,770
  Other current assets                                  57,168       117,095

Total current assets                                 1,175,470     1,428,937

Furniture and equipment, net (Notes 4 and 8)           282,384       345,993

Product software costs, net of accumulated 
 amortization of $271,422 and $238,950                  90,078        77,225

Other assets                                             8,512         1,792

Total assets                                      	$	1,556,444	  $	1,853,947

See accompanying summary of significant accounting policies and notes to 
financial statements.


June 30,                                            		     1997      		1996

Liabilities and Stockholders Equity (Deficit)

Current liabilities:

  Notes payable (Note 7)                              	$	603,407  	$ 	   -     
  Accounts payable and accrued expenses                  510,324     561,753
  Accrued wages and commissions                           89,949     121,014
  Other current liabilities                              254,961     390,857
  Current portion of long-term debt (Note 8)              24,000      35,637

Total current liabilities                              1,482,641   1,109,261

Long-term debt, less current maturities (Note 8)          34,732     251,107

Other liabilities                                         67,449         -     

Dividends payable                                         61,860      51,000

Total liabilities                                      1,646,682   1,411,368

Commitments and contingencies (Notes 6, 12, and 16)

Stockholders equity (deficit) (Notes 1, 5, 6, 7, 
11, 12, 14, and 18):

  Class A preferred stock, no par value; authorized 
4,000 shares; issued and outstanding 2,377 and 2,113 
shares in 1997 and 1996, respectively                  2,289,410   2,026,247
  Common stock, $.01 par value; authorized 
7,000,000 shares and 5,112,495 outstanding in 
1997 and authorized 5,000,000 shares and 4,837,875 
shares in 1996, respectively                              51,125      48,379
  Common stock subscribed                                     -      102,000
  Additional paid-in capital                           2,340,915   2,356,729
  Accumulated deficit                                 (4,771,688) (4,090,776)

Total stockholders equity (deficit)                      (90,238)    442,579

Total liabilities and stockholders equity 
(deficit)
                                                    	$	1,556,444 $	1,853,947


See accompanying summary of significant accounting policies and notes to 
financial statements.


Year Ended June 30,                                   	1997           	1996

Net sales (Notes 6 and 13)                         $ 2,976,847 	 $	4,232,428

Cost of sales                                        1,642,960     2,467,976

Gross profit                                         1,333,887     1,764,452

Costs and expenses:

  Selling, general and administrative                1,782,301     2,651,628
  Research and development                             205,264       363,100
  Other expense (income) net, including interest
   expense of $65,168 in 1997 and $22,314 in 1996       27,234       (46,139)

Loss from operations before extraordinary 
gain on debt restructuring                            (680,912)   (1,204,137)

Extraordinary gain on debt restructuring (Notes 8 
and 9)                                                     -         163,719

Net loss                                           	$	(680,912) $	(1,040,418)

Net loss applicable to common shares               	$	(795,162)	$	(1,201,141)


Loss per common share before extraordinary gain    	$     	-   	$    (.36)

Net loss per common share                          	$	(.16)     $	   (.32)

Weighted average common shares outstanding         		4,968,841  		3,741,658

See accompanying summary of significant accounting policies and notes to 
financial statements.



Class A        Issued   		  Common   	Additional  	
Preferred   Common Stock 		  Stock    		Paid-in    Accumulated    Notes
Stock      Shares    Total   Subsc.     Capital      Deficit      Receiv.
	
	  Treasury  
   	Stock            		Total

Balance, July 1, 1995
$ -       2,704,190	 $27,042  $ 	-    	$2,194,415  	(3,040,635)  	$(67,598)
	   $(27,751)        $(914,527)

Accretion of preferred stock
		-          -         		-     		-        		-        		(9,723)       		-    
		     -            		(9,723)

Issuance of common stock
	-       2,149,300   21,493    		-      		408,507       		-          		-    
		     -           		430,000

Dividends on preferred stock
	-          -          		-     		-       (151,000)      		-          		-    
		     -           	(151,000)

Reclassification 
1,913,247   -          		-     		-        		-           		-          		-    
		     -           	1,913,247

Issuance of preferred stock
113,000     -          		-     		-        		-           		-          		-    
		     -            		113,000

Subscription of common stock
 -          -          		-    	102,000    		-           		-          		-    
		     -            		102,000

Retirement of treasury stock
	-      (15,615)      		(156)  		-      	(27,595)       		-          		-    
		  27,751             		-    

Notes receivable cancellation
	-         -           		-     		-      	(67,598)       		-       		67,598
		     -               		-    

Net loss
	-         -           		-     		-         		-       	(1,040,418)    		-    
		     -            	(1,040,418)

Balance, June 30, 1996
	
$2,026,247   4,837,875   	48,379  	102,000  	2,356,729 	(4,090,776)    -    
		     -            		442,579

Issuance of common stock
- -            300,000       3,000  (102,000)     99,000        -        -     
       -                -     

Retirement of common stock
- -           (25,380)     (254)        -          254          -        -     
       -                -     

Dividends on preferred stock
- -              -           -          -        (115,068)      -        -     
       -             (115,068)

Issuance of preferred stock in settlement of accrued dividends
104,000        -           -          -            -          -        -     
       -              104,000

Issuance of preferred stock in settlement of accrued liability
159,163        -           -          -            -          -        -     
       -              159,163

Net loss
- -              -           -          -            -     (680,912)     -     
       -             (680,912)

Balance, June 30, 1997
$	2,289,410  5,112,495 	$	51,125  	$ 	-  	$	2,340,915	 $(4,771,688)	 $	-    
    	$	-    	       $	(90,238)

See accompanying summary of significant accounting policies and notes to 
financial statements.


Year Ended June 30,                             		      1997     		  1996

Cash flows from operating activities:

  Net loss                                          $	(680,912) 	$(1,040,418)
  Adjustments to reconcile net loss to net cash
   used in operating activities:

    Depreciation and amortization                      143,613       100,498
    Provision for doubtful accounts                     64,507       194,933
    Provision for loss on disposition of inventory          -         91,438
    Gain on debt refinancing                                -         (1,037)
    Loss on disposal of fixed assets                    11,053        34,749
    (Increase) decrease in:
     Accounts receivable                               (71,618)      (99,220)
     Inventories                                       236,958       367,150
     Other assets                                       53,207       144,717
    Increase (decrease) in:
     Accounts payable                                  (51,429)     (492,591)
     Accrued wages and commissions                     (31,065)       27,727
     Other liabilities                                 (68,655)      362,601

Net cash used in operating activities                 (394,341)     (309,453)

Cash flows from investing activities:

  Purchase of furniture and equipment                  (58,585)      (76,379)
  Capitalization of product software costs             (45,325)      (14,080)

Net cash used in investing activities                 (103,910)      (90,459)

See accompanying summary of significant accounting policies and notes to 
financial statements.


Year Ended June 30,                          		           1997       		1996

Cash flows from financing activities:

  Net short-term borrowings                              603,407        -     
  Payments on loan from stockholder                          -        (9,375)
  Payments on long-term debt                             (68,849)    (38,193)
  Issuance of preferred and common stock                     -       430,000


Net cash provided by financing activities                534,558     382,432

Net increase (decrease) in cash and equivalents           36,307     (17,480)

Cash, beginning of year                                   14,631      32,111

Cash, end of year                                      	$	50,938   	$	14,631

See accompanying summary of significant accounting policies and notes to 
financial statements.


Business
The Company develops, manufactures (through 
subcontractors), assembles and markets diagnostic 
equipment primarily for use in physicians offices.


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


Concentration of Credit Risk
Financial instruments which potentially subject the 
Company to concentrations of credit risk consist 
principally of temporary cash investments and trade 
accounts receivable.  The Company places its 
temporary cash investments with high quality credit 
financial institutions.  No losses have been 
experienced on such investments.  The Company 
reviews a customers credit history before 
extending credit.  An allowance for doubtful 
accounts is established based upon factors 
surrounding the credit risk of specific customers, 
historical trends and other information.


Inventories
Inventory is stated at the lower-of-cost determined 
by the first-in, first-out (FIFO) method or market.


Furniture, Equipment,and Depreciation
Furniture and equipment are stated at cost.  
Depreciation is provided using the straight-line 
method for financial reporting purposes and 
accelerated methods for income tax purposes over 
the estimated useful lives of the related assets 
ranging from 5 to 8 years.


Revenue Recognition
Product is shipped directly to the Companys 
customers.  Revenue on these sales is recognized 
when the product is shipped.


Service Contracts
Amounts billed to customers for service contracts 
are recognized as income over the term of the 
agreements and the associated costs are recognized 
as they are incurred.  Other current liabilities 
include service contract revenue deferrals of 
approximately $125,000 in 1997 and $122,000 in 
1996.



Product Development Costs
Costs associated with the development of new 
products and changes to existing products are 
charged to operations as incurred (except Product 
Software Costs).


Product Software Costs
The Company capitalizes certain costs related to 
the development of computer software once 
technological feasibility of the software has been 
established.  These costs, which are reported at 
the lower-of-unamortized cost or net realizable 
value, are amortized principally using the 
straight-line method, over the estimated useful 
economic life of the software, generally 36 months. 
 Amortization expense amounted to approximately 
$32,000 and $31,000 in 1997 and 1996, respectively.


Long-Lived Assets
In March 1995, Statement of Financial Accounting 
Standards (SFAS) No. 121, Accounting for the 
Impairment of Long-Lived Assets and for Long-Lived 
Assets to be Disposed Of, was issued.  SFAS No. 
121 requires that long-lived assets and certain 
identifiable intangibles to be held and used or 
disposed of by an entity be reviewed for impairment 
whenever events or changes in circumstances 
indicate that the carrying amount of an asset may 
not be recoverable.  As of June 30, 1997, the 
Company has determined that no impairment loss need 
be recognized for applicable assets of continuing 
operations.


Income Taxes
The Company accounts for income taxes under the 
liability method.  Deferred tax assets and 
liabilities are based on the difference between the 
financial statement and tax bases of assets and 
liabilities as measured by the enacted tax rates 
which are anticipated to be in effect when these 
differences reverse.  The deferred tax provision is 
the result of the net change in the deferred tax 
assets and liabilities.  A valuation allowance is 
established when it is necessary to reduce deferred 
tax assets to amounts expected to be realized.



New Accounting Pronouncements
In February 1997, the Financial Accounting 
Standards Board issued SFAS 128, Earnings Per 
Share, which established new standards for 
computations of earnings per share.  SFAS 128 will 
be effective for periods ending after December 15, 
1997, and will require presentation of:

1. Basic Earnings per Share, computed by dividing 
income available to common stockholders by the 
weighted average number of common shares 
outstanding during the period and 

2. Diluted Earnings per Share, which gives effect 
to all dilutive potential common shares that 
were outstanding during the period, by 
increasing the denominator to include the number 
of additional common shares that would have been 
outstanding if the dilutive potential common 
shares had been issued.

Had SFAS 128 been effective for the years ended 
June 30, 1997 and 1996, basic and diluted earnings 
per share would have been as follows:


June 30,                              		1997        		1996

Basic earnings per share              		$.16        		$.32

Diluted earnings per share            		$.16        		$.32


In June 1997, the Financial Accounting Standards 
Board issued SFAS No. 130, Reporting Comprehensive 
Income, which establishes standards for reporting 
and display of comprehensive income, its components 
and accumulated balances.  Comprehensive income is 
defined to include all changes in equity except 
those resulting from investments by owners and 
distributions to owners.  Among other disclosures, 
SFAS 130 requires that all items that are required 
to be recognized under current accounting standards 
as components of comprehensive income be reported 
in a financial statement that is displayed with the 
same prominence as other financial statements.


SFAS 130 is effective for financial statements for 
periods beginning after December 15, 1997, and 
requires comparative information for earlier years 
to be restated.  Because of the recent issuance of 
this standard, management has been unable to fully 
evaluate the impact, if any, the standard may have 
on future financial disclosures.  Results of 
operations and financial position, however, will be 
unaffected by implementations of this standard.


Reclassifications
Certain 1996 amounts have been reclassified to 
conform with the 1997 presentation.




1.	Going Concern
During the years ended June 30, 1997 and 1996, the 
Companys net losses were $681,000 and $1,040,000. 
 As of June 30, 1997, the Companys accumulated 
deficit was approximately $4,772,000.  In addition, 
the Company was in violation of bank loan 
covenants, and a number of vendors have placed the 
Company on cash on delivery terms.

Management is aggressively addressing these matters 
by reviewing the current operations of the Company 
and reducing operating costs wherever possible 
while developing new products to meet the demands 
of the changing medical device market.  In January 
1996, in an effort to cut and control operating 
costs, the Company laid off 20 of its non-key 
personnel and terminated certain programs such as 
its performance bonus plan, guaranteed commission 
to new sales personnel, and auto allowances.  
During 1997, the number of employees was further 
reduced from 32 to 16.  The Company has been under 
a general wage and hiring freeze.  Manufacturing of 
the Companys products has been contracted out 
wherever possible to reduce manufacturing overhead 
and improve cash flow.  Management continues to 
closely monitor sales, gross margins, and operating 
expenses making adjustments where necessary to 
become profitable.

The Company has continued to invest in technology 
development, specifically the development of 
Windows 95 software for processing Holter and 
blood pressure data and for the transmission of 
cardiac data as FTP files over the Internet.  
Management believes these developments enhance the 
Companys future business opportunities.

To improve its liquidity, subsequent to June 30, 
1997, the Company sold 850,000 shares of common 
stock to its largest stockholder, Carolina Medical, 
Inc. (Carolina Medical) for $263,500.  In addition, 
the Company is actively seeking investment capital 
from the sale of common or preferred stock, from 
other present stockholders, and from potential new 
investors.  However, no assurance can be given that 
the Company will be successful in raising 
additional capital.



2.	Accounts Receivable
Accounts receivable are summarized as follows:


June 30,	                                           	  1997		        1996

Trade receivables                                  	$	545,908    	$ 552,527

Other receivables                                      39,598        36,960

                                                      585,506       589,487

Less allowance for doubtful accounts                   30,954        42,046


Net accounts receivable                            	$	554,552    	$	547,441


3.	Inventories
Inventories are summarized as follows:

June 30,		                                              1997		       1996

Raw materials                                      	$ 	248,254   	$	400,995

Work-in-process                                         56,934       52,854

Finished goods                                         207,624      295,921

                                                    	$	512,812   	$	749,770


4.	Furniture and Equipment
Major classes of furniture and equipment consist of 
the following:


June 30,		                                              1997	       	1996

Equipment                                           	$ 248,002   	$	253,055

Furniture and fixtures                                 177,373      228,978

Tooling                                                614,972      607,765

Leasehold improvements                                  15,782        3,100

                                                     1,056,129    1,092,898

Less accumulated depreciation and amortization         773,745      746,905

                                                    	$	282,384   	$	345,993


Depreciation expense amounted to approximately 
$112,000 and $78,000 in 1997 and 1996, 
respectively.


5.	Leases
In fiscal 1996, the Company leased its principal 
place of business at an annual rental of $156,100. 
 In September 1996, the landlord, SCANA, agreed to 
terminate the remainder of the Companys 15-year 
lease as of October 31, 1996, in exchange for 160 
shares of the Companys Class A preferred stock as 
payment in full of the accrued rent in arrears of 
approximately $160,000.  The Company entered into 
an agreement to lease another facility beginning 
November 1, 1996, for a period of five years.

The Company also leases equipment in varying 
monthly amounts.  The terms of the leases range 
from 36 to 58 months.

Annual minimum rental payments under operating 
leases are as follows:


Years Ending June 30,

1998         	$	99,976
1999            89,327
2000            91,392
2001            95,424
2002            32,256
            	$	408,375


Rent expense amounted to approximately $91,000 and 
$172,000 in 1997 and 1996, respectively.



6.	Related Parties
The Company had sales of approximately $320,000 and 
$537,000 in 1997 and 1996, respectively, to 
Nishimoto Sangyo Company, Ltd., a stockholder.  At 
June 30, 1997 and 1996, outstanding receivables of 
approximately $148,000 and $125,000, respectively, 
related to these sales.

Carolina Medical, a stockholder of the Company, 
entered into a Licensing Agreement to utilize the 
technology embodied in the Companys Ultra PCI 
portable hand-held ultrasound product line for 
other applications that will not be directly 
competitive with the Companys current portable 
applications for a fee.  Royalties will be paid to 
the Company by Carolina Medical on any future sales 
of Carolina Medical products utilizing the Ultra 
PCI technology.

During 1996, Clarence P. Groff, formerly the 
Companys largest stockholder, resigned.  At that 
time Mr. Groff entered into a termination 
arrangement with the Company whereby he agreed to 
waive his rights and terminate a prior employment 
agreement, and the Company agreed to pay Mr. Groff 
a severance package.  As part of the agreement, the 
Company agreed to indemnify Mr. Groff for actions 
as an officer, director, employee, and agent of the 
Company to the fullest extent permitted under the 
General Corporation Law of Delaware.  In 
consideration of the above, Mr. Groff agreed to a 
confidentiality and nondisclosure, noncompete, no 
recruiting covenant.  The outstanding balance of 
approximately $57,000 as of June 30, 1996, was paid 
in fiscal 1997.



7.	Notes Payable
As of June 30, 1997, the Company had $453,407 
outstanding under a line-of-credit arrangement.  
The line-of-credit is limited to the lesser of 
$750,000 or the sum of 80 percent of eligible 
receivables and 100 percent of eligible inventories 
(capped at $130,000).  The line bears interest at 2 
percent plus the greater of the prime rate or 7 
percent, is renewable December 31, 1997, and is 
secured by accounts receivable and inventory.  The 
line was extended to December 31, 1998.  However, 
the Company is in violation of certain covenants, 
including the minimum net working capital and 
minimum tangible net worth requirements. 

As of June 30, 1997, the Company had $150,000 
outstanding on a loan agreement with BIOTEL, a 
stockholder.  The loan bears interest at a 12 
percent annual rate and is payable on or before 
January 1, 1998.  Interest expense for the year 
ended June 30, 1997, approximated $17,000.  The 
note has been extended to January 1, 1999.


8.	Long-Term Debt
On March 2, 1996, the Company restructured the past 
due rent under eight operating leases and its 
short-term note with Onbank of Syracuse, New York 
into one long-term note.  As part of the agreement, 
approximately $92,000 in delinquent lease payments 
were forgiven and have been recorded as an 
extraordinary item.  The note will be repaid in 48 
monthly principal installments of $2,000 plus 
interest at 11 percent and is secured by furniture, 
fixtures, and equipment.  The balance of the note 
was $58,732 and $74,964 as of June 30, 1997 and 
1996, respectively.

In addition, the Company has $51,041 outstanding as 
of June 30, 1997 and 1996, in miscellaneous notes 
outstanding related to royalty agreements.  The 
notes are payable in monthly principal only 
installments of $2,981.

On June 1, 1996, the Company restructured the past 
due rent under five operating leases with Syracuse 
Supply Company in Syracuse, New York into one 
short-term note.  As part of the agreement, 
approximately $8,500 in delinquent lease payments 
were forgiven and have been recorded as an 
extraordinary item.  The outstanding balance of the 
note was $0 and $11,637 as of June 30, 1997 and 
1996, respectively.



9.	Extraordinary Gain on 
Debt Restructuring
In addition to the Companys restructuring of its 
debt discussed in Note 8, certain trade payable 
account balances were settled for amounts less than 
reflected in the accounting records in 1996.  The 
net amount forgiven of approximately $63,500 has 
been reflected as an extraordinary item.


10.	Income Taxes
The components of the net deferred tax asset were 
as follows:


June 30,		                                               1997		       1996

Temporary differences relating to:

  Inventory                                           	$	81,954   	$	97,776

  Accounts receivable                                    11,750      14,296

  Furniture and equipment                               (41,871)    (51,792)

  Accruals                                               24,280      16,827

  General business tax credits                          170,115     188,195

  Software costs                                        (34,193)     26,257

  Operating loss carryforwards                        1,440,797     690,611

                                                      1,652,832     982,170

Less valuation allowance                             (1,652,832)   (982,170)

                                                    	$    	-      	$	   -     


The Company had total net operating loss 
carryforwards of approximately $3.8 million 
available at June 30, 1997, which may be offset 
against future taxable income through 2012.  As a 
result of uncertainties regarding the Companys 
ability to realize its deferred tax assets, 
valuation allowances equal to the entire amount of 
such assets have been recorded at June 30, 1997 and 
1996.



11.	Stock Options
The Company has reserved 750,000 shares of 
authorized common stock for issuance pursuant to 
the terms of an Incentive Stock Option Plan.

Stock options are granted at prices not less than 
100 percent of the fair market value of common 
shares at the date of the grant and expire five 
years from the date of grant.  Stock option 
activity during 1997 and 1996 is as follows:



                             Number                       Option Price
                             Shares             	Per Share         		Total

Outstanding at
 June 30, 1996              115,350             	$.31$1.63       	$	100,011

Granted                     275,000             	$.25              		68,750

Canceled                    (55,350)            	$.31$1.63        		(46,566)

Outstanding at
 June 30, 1997              335,000             	$.25 $1.63      	$	111,150


The Company has adopted the disclosure only 
provisions of Statement of Financial Accounting 
Standards No. 123, Accounting for Stock-Based 
Compensation.  Accordingly, no compensation cost 
has been recognized for the stock option plans.  
Had compensation cost for the Companys stock 
option plan been determined based on the fair value 
at the grant date for awards consistent with the 
provisions of SFAS No. 123, the Companys net loss 
and loss per share would have been reduced to the 
pro forma amounts indicated below:


June 30,                                                       		1997

Net loss as reported                                         	$	(680,912)

Net loss pro forma	                                           $	(693,121)

Loss per share as reported                                   	$	(.16)

Loss per share pro forma                                     	$	(.16)


The fair value of each option grant is estimated on 
the date of grant using the Black-Scholes option 
pricing model with the following weighted-average 
assumptions used for grants:

- - Dividend yield of 0 percent
- - Expected volatility of 106.14 percent
- - Risk free interest rate of 6.94 percent
- - An expected life of 2 years


12.	Commitments and Contingencies
The Company has not obtained product liability 
insurance to date due to the prohibitive cost.  The 
nature and extent of liability for product defect 
is uncertain.  There are no known product liability 
claims and management presently believes that there 
is no material risk of loss to the Company from 
product liability claims against the Company.

During 1993, the Securities and Exchange Commission 
(SEC) commenced a private investigation of the 
Companys accounting and recordkeeping practices to 
determine if violations of Federal securities laws 
have occurred.  On September 5, 1996, the SEC 
accepted an offer of settlement whereby the 
Company, James H. Brown, the Companys Vice 
President, and Clarence P. Groff, the Companys 
former President, without admitting or denying any 
wrongdoing, signed a consent decree to cease and 
desist from committing or causing any violations 
and any future violations of certain sections of 
the Securities and Exchange Act.  The cease and 
desist order provided for in the Order took effect 
on the date of the entry of the Commissions Order.


13.	Significant Customers and Export Sales
The percentages of the Companys sales to certain 
major customers are as follows:

                                         	           1997        	1996
Kontron Instruments, Inc.                            	7%          	16%

Nishimoto Sangyo Company, Ltd. (Note 6)             	11%          	13%


Export sales, primarily to Japan and the United 
Kingdom, totaled approximately $536,000 and 
$1,311,000 in 1997 and 1996, respectively.


14.	Capital Stock 
	Transactions
During 1993, the Company authorized 4,000 shares of 
Class A Preferred Stock, no par value, of which 
2,000 shares were issued to Nishimoto Sangyo 
Company, Ltd. (Nishimoto).  The Class A Preferred 
Stock calls for cumulative dividends of $50 per 
share per year and has a liquidation preference of 
$1,000 per share.  In addition, interest is accrued 
on all unpaid dividends at a rate of 10 percent per 
annum.  The Company is required to pay all 
dividends on the preferred stock prior to declaring 
or paying a dividend to common stockholders.

Prior to March 31, 1996, the Company could redeem 
all but no less than all of the Class A Preferred 
Stock at any time with a mandatory redemption date 
of October 2002, at a price of $1,000 per share.  
Additionally, the Class A preferred stock could be 
redeemed at the option of the holder upon 
termination of a distribution agreement with the 
Company, with the redemption price payable in three 
equal annual installments.

Effective March 31, 1996, Nishimoto relinquished 
control of all redemption rights on its 2,000 
shares of preferred stock and received an 
additional 113 shares of preferred stock in lieu of 
$113,000 of accrued but unpaid dividends and 
accumulated interest.  Redemption rights for these 
additional shares has also been assigned to the 
Company.

The Class A Preferred Stock is recorded at fair 
value at the date of issuance.  Prior to the 
relinquishing of redemption rights, the difference 
between the recorded value and the redemption value 
was accreted using the interest method over the 
life of the issue by charges to retained earnings.

On January 12, 1996, Carolina Medical purchased 
750,000 shares of the Companys authorized but 
previously unissued common stock for $150,000.  
BIOTEL, a holding company that owns a majority 
interest in Carolina Medicals stock, purchased an 
additional 1,400,000 shares of the Companys common 
stock on March 29, 1996, for $280,000.  As 
discussed in Note 18 subsequent to year-end, BIOTEL 
purchased additional shares of the Company.  In 
addition BIOTEL was merged into Carolina Medical.


Effective March 31, 1996, Nishimoto entered into an 
agreement to convert $102,000 of its accrued 
dividend and interest into 300,000 shares of $0.01 
par common stock at $0.34 per share to be issued by 
December 31, 1996.  As stockholders representing a 
majority of the stock outstanding had signed 
agreements to authorize the issuance of these 
shares, the amount was classified as common stock 
subscribed in the June 30, 1996, financial 
statements.  Effective December 1996, the Company 
increased the number of authorized shares from 
5,000,000 to 7,000,000, and the $102,000 
subscription was converted to 300,000 common 
shares.  

On September 20, 1996, the Company issued 160 
shares of Class A preferred stock to SCANA as 
payment in full of the lease payments in arrears of 
approximately $160,000.

On December 31, 1996, the Company issued 104 shares 
of Class A preferred stock to Nishimoto in 
settlement of dividends earned for calendar 1996.


15.	Estimated Fair Value of Financial Instruments
The estimated fair value of financial instruments 
have been determined based on available market 
information and appropriate valuation 
methodologies.  However, considerable judgment is 
necessarily required in interpreting market data to 
develop the estimates of fair value.  Accordingly, 
the estimates presented herein are not necessarily 
indicative of the amounts that the Company might 
realize in a current market exchange.  The use of 
different market assumptions and/or estimation 
methodologies may have a material effect on the 
estimated fair value.

The carrying amounts of cash and cash equivalents, 
accounts receivable, short-term notes payable, 
accounts payable, and other accrued liabilities are 
reasonable estimates of their fair value. 

At June 30, 1997, the carrying value of long-term 
debt of approximately $70,000 did not differ 
materially from its estimated fair value.  At June 
30, 1996, the carrying value of long-term debt was 
approximately $287,000, while the estimated fair 
value was $258,000, based upon interest rates 
available to the Company for issuance of similar 
debt with similar terms and remaining maturities.  
The excess of carrying value over fair value in 
1996 of $29,000 represents the future interest on 
restructured debt, which is required under 
generally accepted accounting principles to be 
recognized currently as a reduction of the 
extraordinary items discussed in Note 8.  

The fair value estimates were based on pertinent 
information available to management as of June 30, 
1997 and 1996.  Such amounts have not been 
comprehensively revalued for purposes of these 
financial statements since those dates, and current 
estimates of fair value may differ significantly 
from the amounts presented herein.


16.	Employee Benefits
The Company has a defined contribution 401(k) plan 
covering substantially all employees.  Participants 
may contribute up to 15 percent of their annual 
compensation to the plan.  The Company matches 25 
percent of a participants contribution up to 4 
percent of salary.  Contributions for the years 
ended June 30, 1997 and 1996, amounted to 
approximately $0 and $7,800, respectively.


17.	Supplemental Cash 
Flow Information
Cash paid for interest consisted of:


Year Ended June 30,		                                    1997       		1996

Interest                                              		$51,439   		$22,314


18.	Subsequent Events
In October 1997, the Company entered into a stock 
purchase agreement with BIOTEL to sell an 
additional 850,000 shares of its common stock to 
BIOTEL for $138,500 in cash and an $80,000 note 
which was paid in April 1998.  Effective with the 
issuance of the additional shares, BIOTEL and 
Carolina Medical collectively owned 50.3 percent of 
the outstanding common stock of the Company.  In 
December 1997, BIOTEL was merged into Carolina 
Medical.

In March 1998, Carolina Medical signed a letter-of-
intent, subject to stockholder approval to merge 
with Biosensor Corporation, a publicly traded 
company, through a reverse stock merger in which 
the stockholders of Carolina Medical would obtain 
an 80 percent interest in Biosensor.  Carolina 
Medical is negotiating with Nishimoto to acquire 
its preferred and common stock ownership in the 
Company for stock in Carolina Medical.




 

 
 











F-1

Advanced Medical Products Inc.

Contents






F-2



F-3

Advanced Medical Products Inc.

Balance Sheets






F-4

Advanced Medical Products Inc.

Balance Sheets






F-5

Advanced Medical Products Inc.

Statements of Loss






F-7

Advanced Medical Products Inc.

Statements of Changes in Stockholders Equity (Deficit)







Advanced Medical Products Inc.

Statements of Cash Flows






F-10

Advanced Medical Products Inc.

Summary of Significant Accounting Policies







Advanced Medical Products Inc.

Notes to Financial Statements

EX-27

 

<ARTICLE> 5
       
                             
<PERIOD-TYPE>                   YEAR
<FISCAL-YEAR-END>                          JUN-30-1997
<PERIOD-END>                               JUN-30-1997
<CASH>                                          50,938
<SECURITIES>                                         0
<RECEIVABLES>                                  585,506
<ALLOWANCES>                                  (30,954)
<INVENTORY>                                    512,812
<CURRENT-ASSETS>                             1,175,470
<PP&E>                                         372,462
<DEPRECIATION>                                 143,613
<TOTAL-ASSETS>                               1,556,444
<CURRENT-LIABILITIES>                        1,482,641
<BONDS>                                              0
<PREFERRED-MANDATORY>                                0
<PREFERRED>                                  2,289,410
<COMMON>                                        51,125
<OTHER-SE>                                   2,340,915
<TOTAL-LIABILITY-AND-EQUITY>                 1,556,444
<SALES>                                      2,976,847
<TOTAL-REVENUES>                             2,976,847
<CGS>                                        1,642,960
<TOTAL-COSTS>                                1,642,960
<OTHER-EXPENSES>                             1,987,565
<LOSS-PROVISION>                                     0
<INTEREST-EXPENSE>                              27,234
<INCOME-PRETAX>                              (680,912)
<INCOME-TAX>                                         0
<INCOME-CONTINUING>                                  0
<DISCONTINUED>                                       0
<EXTRAORDINARY>                                      0
<CHANGES>                                            0
<NET-INCOME>                                 (680,912)
<EPS-PRIMARY>                                    (.16)
<EPS-DILUTED>                                    (.16)