10-K405

 
		     SECURITIES AND EXCHANGE COMMISSION  
			     Washington, D.C.  20549  
		      ___________________________________  
  
				   FORM 10-K  
(Mark one)  
  
[X] Annual report pursuant to Section 13 or 15(d) of the Securities Exchange   
Act of 1934 for the fiscal year ended March 31, 1997 
  
				      OR  
  
[ ] Transition report pursuant to Section 13 or 15(d) of the Securities   
Exchange Act of 1934 for the transition period from __________ to ________  
  
			 Commission File No. 0-15360  
  
		       BIOJECT MEDICAL TECHNOLOGIES INC.  
	  (Exact name of registrant as specified in its charter)  
  
	   Oregon                                       93-1099680  
(State of other jurisdiction of                (I.R.S. identification no.)  
 employer incorporation or organization)  
  
       7620 SW Bridgeport Road  
	   Portland, Oregon                                 97224  
(Address of principal executive offices)                 (Zip code)  
  
			     (503) 639-7221  
	   (Registrant's telephone number, including areas code)  
  
      Securities registered pursuant to Section 12(b) of the Act:  
  
    Title of each class           Name of each exchange on which registered  
	   None                                       None  
  
	Securities registered pursuant to Section 12(g) of the Act:  
  
			       Title of Class  
			 Common Stock, no par value  
  
     Indicate by check mark whether the registrant (1) has filed all reports   
required to be filed by Section 13 or 15(d) of the Securities Exchange Act   
of 1934 during the preceding 12 months (or for such shorter period that the   
registrant was required to file such reports), and (2) has been subject to   
such filing requirements for the past 90 days.  Yes [X]   No [ ]  
  
     Indicate by check mark if disclosure of delinquent filers pursuant to   
Item 405 of Regulation S-K is not contained herein, and will not be   
contained, to the best of registrants knowledge, in definitive proxy or 
information  statements incorporated by reference in Part III of this Form 
10-K or any  amendment to this Form 10-K. [ ]   
  

     State the aggregate market value of voting stock held by non-affiliates   
of the registrant, as of May 31, 1997: $17,660,800  
  
     Indicate the number of shares outstanding of each of the registrant's   
classes of common stock, as of May 31, 1997:  Common Stock, no par value,   
19,540,413 shares.  

		      Documents Incorporated by Reference:  
  
Portions of the registrant's definitive Proxy Statement for the 1997 
Annual  Shareholders' Meeting are incorporated by reference into 
Part III  
  
  
  
  
			     Table of Contents  
  
				  PART I  
  
  
  
Item 1.       Business  
  
Item 2.       Properties  
  
Item 3.       Legal Proceedings  
  
Item 4.       Submission of Matters to a Vote of Security Holders  
  
				   PART II  
  
Item 5.       Market for the Registrant's Common Equity and Related  
	       Stockholder Matters  
  
Item 6.       Selected Consolidated Financial Data  
  
Item 7.       Management's Discussion and Analysis of Financial  
	       Condition and Results of Operations  
  
Item 8.       Consolidated Financial Statements and Supplementary Data  
  
Item 9.       Changes in and Disagreements with Accountants on  
	       Accounting and Financial Disclosure  
  
				   PART III  
  
Item 10.      Directors and Executive Officers of the Registrant  
  
Item 11.      Executive Compensation  
  
Item 12.      Security Ownership of Certain Beneficial Owners and  
	       Management  
  
Item 13.      Certain Relationships and Related Transactions  
  
				   PART IV  
  
Item 14.      Exhibits, Financial Statement Schedules and Reports  
	       on Form 8-K  
  


				   PART I  
  
ITEM 1.     BUSINESS  
  
FORWARD-LOOKING STATEMENTS  
  
Certain statements in this Report constitute "forward-looking   
statements" within the meaning of the Private Securities Litigation 
Reform  Act of 1995.  Such forward-looking statements involve known 
and unknown  risks, uncertainties and other factors which may cause the 
actual results,   performance or achievements of the Company, or industry 
results, to be  materially different from any future results, performance, 
or achievements  expressed or implied by such forward-looking statements.  
Such risks,  uncertainties and factors include, among others, those described 
under  "Business -- Risk Factors."  
  

GENERAL  

Bioject Medical Technologies Inc. ("Bioject" or the "Company")   
develops, manufactures and markets a jet injection system for needle-free   
drug delivery. Using this technology for injections virtually eliminates the   
associated risk of contaminated needlestick injuries and resulting blood-  
borne pathogen transmission, a major concern throughout the healthcare   
industry.  The Company manufactures and markets a professional jet injection   
system, the Biojector (registered trademark) 2000, which allows healthcare   
professionals to inject medications through the skin, both intramuscularly   
in the deltoid muscle and subcutaneously, without a needle.  The Biojector   
2000 system consists of two components: a hand-held, reusable jet-injector  
(the "Biojector 2000"); and a sterile, single-use disposable syringe   
("Biojector syringe"). The system is capable of delivering variable dose   
needle-free injections up to 1 ml. Additionally, the Company has developed 
a  self-injection system for delivery of various medications up to 1 ml. for 
use by non-professionals, and the Company is also developing systems for 
Hoffmann-La Roche to use with certain of their products pursuant to an 
agreement signed January 10, 1995.  See "Research and Product Development."  
  
Currently, medications are administered using various methods, each of   
which has advantages and limitations.  The leading drug delivery techniques   
include oral ingestion, intravenous infusion, subcutaneous and intramuscular   
injection, inhalation and transdermal diffusion "patch."  Many drugs are  
effective only when administered by injection.  Studies indicate that there   
are more than four billion needle-syringes sold annually in the U.S.  The   
Company believes that approximately 80% of these syringes are used for   
subcutaneous or intramuscular injections up to 1 ml.
 
Injections using traditional needle-syringes suffer from many   
shortcomings including (i) the risk of needlestick injuries, (ii) the risk   
of penetrating a patient's vein and (iii) patients' aversion to needles and   
discomfort.  The most important of these, the contaminated needlestick   
injury, occurs when a needle that has been exposed to a patient's blood   
accidentally penetrates a healthcare worker's skin.  Contaminated needles   
can transmit deadly blood-borne pathogens including such viruses as HIV 
and hepatitis B.  Published data indicate that the total number of reported   
needlestick injuries in the U.S. exceeds 800,000 annually.  

In recent years, with the growing awareness of blood-borne pathogen   
transmission, safety has become a critical concern for hospitals and   
healthcare professionals as well as patients.  As a result, pressures on the   
healthcare industry to eliminate the risk of contaminated needlestick   
injuries have  increased.  For example, the U.S. Occupational Safety and   
Health Administration ("OSHA") issued regulations, effective in 1992, which   
require healthcare institutions to treat all blood and other body fluids  
as infectious.  These regulations require the implementation of "engineering   
and work practice controls" to "isolate or remove the blood-borne pathogens   
hazard from the workplace."  Among the required controls are special   
handling and disposal of contaminated "sharps" in biohazardous "sharps"   
containers and follow-up testing for victims of needlestick injuries.  These  
regulations have significantly increased the cost of using needle-syringes.  
  
The costs resulting from needlestick injuries vary widely.   
Uncontaminated needlesticks involve relatively little cost, while   
investigating and following up contaminated needlestick injuries are much   
more expensive.  Investigation typically includes identifying the source of   
contamination, testing the source for blood-borne pathogens and repeatedly   
testing the needlestick victim over an extended period.  Some healthcare   
providers are requiring additional measures, including presuming that all  
needlestick injuries involve contaminated needles unless proven otherwise   
and, under certain circumstances,  administering prophylactic treatment such   
as zidovudine (AZT) or other drugs. The costs associated with treating   
needlestick injuries that result in infection by life-threatening pathogens,   
such as HIV or hepatitis B, are dramatically higher. In an effort to protect  
healthcare workers from needlestick injuries, many healthcare facilities have   
adopted more expensive, alternative technologies.  One such   
technology is an intravenous ("IV") port that permits the injection of   
medication directly into the IV line without requiring the use of a sharp   
needle for each administration.  Another is the "safety syringe," generally   
a disposable needle-syringe with a plastic sheath mechanism intended to   
cover the needle after use.  Despite many efforts to reduce the risk of   
needlestick injuries, such injuries remain a major health concern.  
  
The Company's long-term goal is to establish its jet injection   
technology as the preferred drug delivery method for all medications   
administered by intramuscular or subcutaneous injection.  The Company   
currently markets the Biojector 2000 system to public health and flu 
immunization clinics, and physician offices, has developed a self-injection
device for the delivery of various medications to be delivered by 
non-professionals in the home and is developing application specific devices
to be marketed by Hoffmann-La Roche.  The Company is also seeking 
relationships with pharmaceutical and biotechnology companies to market its 
existing Biojector 2000 and self injector products for specific applications
and to develop other application specific devices and companion syringes.  

THE COMPANY  
  
The Company's operations are conducted by Bioject Inc., an Oregon    
corporation, which is a wholly owned subsidiary of Bioject Medical   
Technologies Inc., an Oregon corporation (the "Company").  
  
Although Bioject Inc. commenced operations in 1985, the Company was   
formed in December 1992 for the sole purpose of acquiring all the capital   
stock of Bioject Medical Systems Ltd., a Company organized under the laws 
of British Columbia, Canada, in a stock-for-stock exchange in order   
to establish a U.S. domestic corporation as the publicly traded parent   
company for Bioject Inc. and Bioject Medical Systems Ltd.  Bioject Medical 
Systems Ltd. was terminated in fiscal 1997.  All references to the Company 
herein are to Bioject Medical Technologies Inc. and its   
subsidiary, unless the context requires otherwise.  The Company's   
executive offices and operations are located at 7620 SW Bridgeport Road,   
Portland, Oregon 97224, and its telephone number is (503) 639-7221.  
  
     "Biojector" and "Bioject" are trademarks of the Company.  
  
DESCRIPTION OF THE COMPANY'S PRODUCTS  
  
The Company's current product, the Biojector 2000 system, is a   
refinement of jet injection technology that enables healthcare professionals   
to reliably deliver measured variable doses of medication through the skin,   
either intramuscularly or subcutaneously, without a needle.  Giving an 
injection with a Biojector 2000 system is easy and straightforward. The 
healthcare worker checks the CO2 pressure on the easy-to-read gauge at the 
rear of the injector, draws up medication into the plastic syringe 
discarding the fill needle in a sharps container, inserts  the syringe 
into the power  injector, presses the syringe tip against the appropriate 
disinfected surface on the patient's skin, and then presses an   
actuator thereby injecting the  medication.  Medication is expelled rapidly   
through a precision molded, small diameter orifice in a thin stream at a   
velocity sufficient to penetrate the skin and force the medication into the   
tissue at the desired level.  The Biojector 2000 system consists of two   
components:  a hand-held, reusable jet injector; and a sterile, single-use   
disposable plastic syringe capable of delivering variable doses of   
medication up to 1 ml.  
  
The first component, the Biojector 2000, is a portable hand-held unit   
(about the size of a flashlight) which is designed to be easy to use by   
healthcare professionals, as well as attractive and non-threatening to   
patients.  As described in the June 7, 1993 issue of BUSINESSWEEK, the   
Biojector 2000 won the 1993 Gold Industrial Design Excellence Award given by   
Industrial Designers Society of America for its aesthetically pleasing and   
ergonomic design.  In July 1994, the Biojector 2000 also received the   
Alliance of Children's Hospitals Seal of Approval.  The Biojector 2000   
injector uses disposable CO2 cartridges as a power source. The CO2   
cartridges, which are purchased by the Company from an outside supplier,   
give an average of ten injections before requiring replacement.  The CO2 gas   
provides consistent, reliable pressure in order to push the syringe plunger   
and thereby propel the medication.  The CO2 does not come into contact with   
the patient or medication.  

The second component, the Biojector single-use disposable syringe, is   
provided in a sterile, peel-open package and consists of a plastic, needle-  
free, variable dose syringe containing a plunger, accompanied by a needle   
used only for filling.  The body of the syringe is transparent and has   
graduated markings to aid filling by healthcare workers in the same way as   
traditional needle-syringes are filled.  However, unlike the traditional  
needle-syringe, the Biojector fill needle is designed to be immediately   
discarded in a "sharps" container as soon as the syringe is filled, so that   
a needle need never come near a patient when an injection is being given.    
More importantly, since no needle penetrates the patient's skin, the risk of  
contaminated needlestick injury is virtually eliminated.  Under OSHA   
regulations, used Biojector syringes need not be disposed of in a special   
biohazardous "sharps" container.  
  
There are five different Biojector syringes, each of which is intended   
for a different injection depth or body type.  The syringes are molded using   
the Company's patented manufacturing process.  The healthcare worker selects   
the syringe appropriate for the intended type of injection.  One syringe   
size is for subcutaneous injections, while the others are designed for  
intramuscular injections, depending on the patient's body   
characteristics.  
  
The current suggested retail list price for the Biojector 2000   
professional jet injector is $995, and the suggested retail list price for   
syringes is $1.00 a piece.  CO2 cartridges are sold for a suggested retail   
price of $0.50 per cartridge and average ten injections per cartridge.    
Discounts are offered for volume purchases.  
  
The Company has other products in development which are intended to   
address other markets or to enhance the Biojector 2000 system.  See   
"Research and Product Development."  
  
INDUSTRY BACKGROUND  
  
In 1836, LaForgue developed the concept of placing medicine under the   
skin by means of a needle lance trochar.  In 1853, Wood developed the   
hollow-needle hypodermic which was later improved by Hunter, Pravaz and 
many others.  The basic needle-syringe in use across the healthcare market 
today is a direct derivation from the original Wood design and involves a 
hollow steel needle of various diameters and lengths attached to a plastic 
syringe body and plunger.  The entire unit requires special handling and 
disposal.  
  
The next fundamental improvement in injection technique for parenteral   
administration was made approximately 100 years following Wood's 
development  of the hollow-needle hypodermic. This improvement was the 
development of a pneumatically powered hypodermic device which was capable 
of injecting medication through the skin without a needle.  These early 
needle-free injection devices were large and bulky devices which lent 
themselves to mass inoculations but were inappropriate for single-shot 
administrations of medication in the physician's office, hospital or in the 
home setting.  
  
During the last 20 years, there have been many attempts to develop   
portable one-shot needle-free hypodermic devices.  Some of the problems   
which arose in these attempts to develop such devices include:  (a)   
inadequate injection power; (b) little or no control of pressure and depth   
of penetration; (c) complexity of design with related difficulties in cost   
and performance; (d) difficulties in use, including filling and cleaning;   
and (e) the necessity for sterilization between patients.  
  

In recent years, several spring-driven needle-free injectors have been   
developed and marketed primarily for the injection of insulin.  Each of   
these devices requires regular cleaning as well as filling from a separate   
medication bottle or vial.  Current prices for such injectors range from   
approximately $400 to $600 per injector.  The Company believes that due to   
the cost combined with the difficulties of use, market acceptance of these   
devices has been limited. 
  
Also in recent years, various versions of a "safety syringe" have been   
designed and marketed.  These syringes generally involve as their basic   
design a standard or modified needle-syringe with a plastic guard or   
sheathing surrounding the needle. Such covering is usually retracted or   
removed in order to give the injection.  Although the intent of the safety   
syringes is to reduce or eliminate needlestick injuries, the syringes   
require manipulation after injection and, therefore, still pose the risk  
of needlestick injury.  They are also bulky and add to contaminated waste   
disposal problems.  
  
  
MARKETING AND COMPETITION  
  
The Company is currently focusing on gaining acceptance of the   
Biojector system in the U.S. public health clinic and flu immunization 
markets. The Company is also working on arrangements to market the Biojector
2000 system to the U.S. physician office market and the home healthcare 
market.  The Company plans eventually to expand into international markets. 
Different marketing and distribution approaches are required in each of 
these markets. As new products are developed, the Company intends to 
establish additional channels of distribution.  For example, the Company 
is developing an injection system for specific applications which is 
anticipated to be marketed by Hoffmann-La Roche.  Pre-filled Biojector 
syringes, if developed, would be filled and marketed by the pharmaceutical
or biotechnology companies involved.  
  
The Company currently employs five sales representatives to be a dedicated   
sales force to sell the Company's Biojector 2000 system directly to the   
public health clinic and flu immunization markets in key metropolitan areas.  
These sales representatives are led by a vice president of sales and 
marketing and are supported by a product manager, customer service staff, 
three full time nurse trainers and 10-20 per diem nurse trainers.  Bioject's
direct sales efforts have resulted in the signing of public health 
agreements for the state of North Carolina, the New York City Middle Schools,
and the health departments in the states of New Mexico and Oklahoma.  
The Company expects to sign additional agreements with other public health 
agencies.  The Company has a national agreement with the Visiting Nurses 
Associations for use of the Biojector 2000 system for flu immunization.  In 
addition, through the VNA member organizations, it was recently announced 
that the Company will participate in a new flu immunization program to be 
sponsored by Wal-Mart this fall.  It is the Company's intention to leverage 
its success in these immunization programs to attract pharmaceutical company
strategic partners to assist it in gaining access to the physician office 
and other specialized markets where the benefits of needle-free drug 
delivery will enhance the distribution of their injectible medications.

In August 1994, Bioject signed an agreement with Homecare Management,   
Inc. (HMI), granting HMI exclusive rights to purchase Bioject's Needle-Free   
Injection Management System, the Biojector 2000, for use in the home   
healthcare market. Sales to HMI commenced in August 1994.  In return for   
HMI's commitment to purchase a minimum of 8,000 Biojector units over the   
ensuing two years, the Company granted volume pricing discounts to HMI.  
Throughout the term of the contract the selling price of Biojectors to HMI   
exceeded their standard cost.  During fiscal 1995 and 1996, the Company sold   
approximately 2,100 and 4,300 Biojectors to HMI for total sales revenue   
including syringes of $1.1 million and $2.2 million, respectively. HMI 
had not placed the great majority of these Biojectors with patients pending  
completion of negotiations with pharmaceutical companies for certain pricing   
concessions for medication to be administered with the Biojectors.  In   
January 1996, HMI requested that further shipments under the contract be   
suspended.  In February 1996, the Company learned from HMI's press releases   
that HMI expected to default under its loan, to take significant write-offs   
for accounts receivable and inventories, planned operational consolidations,   
and would restate certain prior period financial statements.  In fiscal 1997,
the Company agreed to repurchase certain of the Biojector inventories 
(including up to 6,000 devices) which HMI had on hand for a   
total of $660,000 including $322,000 of forgiveness of accounts receivable   
and payment of $338,000 in two installments, one-half of which was paid in 
July 1996 and with the balance remaining outstanding.  The Company was under 
no obligation to repurchase these inventories, and the repurchase was at a 
substantial discount to the original selling price to HMI.  

The sale of new technologies to hospitals and large clinics can be a   
lengthy process.  Introduction of new technologies to a hospital or large   
clinic typically involves screening by many individuals and committees   
within the institution, including new product evaluation committees,   
infection control officers, medical staff and business office personnel.  
Therefore, in order to shorten the sales cycle, the Company has adopted a 
strategy that focuses instead on the public health and flu immunization 
markets where there are fewer and more concentrated decision makers. 

The medical equipment market is highly competitive, and competition is likely
to intensify.  Many of the Company's existing and potential competitors have 
been in business longer than the Company and have substantially greater 
technical, financial, marketing, sales and customer support resources.  The 
Company believes the primary competition for the Biojector 2000 system and 
other jet injectors it may develop is the traditional disposable needle-
syringe and the "safety syringe."  Leading suppliers of needle-syringes 
include:  Becton-Dickinson & Co., Sherwood Medical Co., a subsidiary of 
American Home Products Corp., and Terumo Corp. of Japan.  Manufacturers of 
traditional needle-syringes compete primarily on   
price, which generally ranges from approximately $0.10 to $0.20 per unit.    
Manufacturers of "safety syringes" compete on features, quality and price.  
"Safety syringes" generally are priced in a range of $0.25 to $0.45 per   
unit.  
  
The Company expects to compete with traditional needle-syringes and   
"safety syringes" based on healthcare worker safety, ease of use, reduced   
cost of disposal, patient comfort, and compliance with OSHA regulations, but   
not on purchase price.  However, the Company believes that when all indirect   
costs (including disposal of syringes and testing, treatment and workers'   
compensation expense related to needlestick injuries) are considered, the   
Biojector 2000 system will compete effectively.  See "Forward Looking   
Statements" and "Risk Factors."  
  
The Company is not aware of any competing products with features and   
benefits comparable to the Biojector 2000 system. The Company is aware of 
other portable needle-free injectors on the market today but these are 
generally focused on subcutaneous self-injection applications of 0.5 ml. or 
less whereas the Company's products are suitable for both intramuscular and 
subcutaneous of up to 1 ml. in the professional and home injection markets.  
Manufacturers of needle-syringes, as well as other companies, may develop 
new products that compete directly or indirectly with the Company's products.
There can be no assurance that the Company will be able to 
compete successfully in this market.  See "Risk Factors - Competition," "- 
Dependence on Single Technology."  A variety of new technologies (for 
example, transdermal patches) are being developed as alternatives to 
injection for drug delivery.  While the Company does not believe such 
technologies have significantly affected the use of injection for drug 
delivery to date, there can be no assurance that they will not do so in 
the future.  

PATENTS AND PROPRIETARY RIGHTS  
  
The Company believes that technology incorporated in its injection   
device, single-dose disposable plastic syringes and products under   
development gives it significant advantages over the manufacturers of other   
jet injection systems and over prospective competitors seeking to develop   
similar systems.  The Company attempts to protect its technology through a   
combination of trade secrets, confidentiality agreements and procedures and  
patent prosecution.  
  
The Company has three U.S. patents which were issued with respect to jet   
injection technology incorporated in earlier versions of its jet injection   
systems and which expire from July 2007 to November 2008. Seven additional   
U.S. patents have been issued which protect developments incorporated in the   
Biojector 2000 system.  These patents incorporate a number of claims   
including claims regarding the jet injection system's design, method of   
operation, certain aspects of the syringe design and the method of   
manufacturing the syringe orifice.  The Company has also been granted   
patents relating to an electronic self-injection device and a drug mixing   
vial, newer technologies not yet incorporated in any product.  The Company   
has made additional patent filings regarding pre-filled syringe technologies   
and adapters for drug vial access.  The Company also generally files patent   
applications in Canada, Europe and Japan at the times and under the   
circumstances it deems filing to be appropriate under the procedures in   
place in each jurisdiction. There can be no assurance that any patents   
applied for will be granted or that patents held by the Company will be   
valid or sufficiently broad to protect the Company's technology or provide a   
significant competitive advantage.  See "Risk Factors."  
  
The Company also relies on trade secrets and proprietary know-how that   
it seeks to protect through confidentiality agreements with its employees,   
consultants, suppliers and others. There can be no assurance that these   
agreements will not be breached, that the Company would have adequate   
remedies for any breach, or that the Company's trade secrets will not   
otherwise become known to or be developed independently by competitors.  In  
addition, the laws of foreign countries may not protect the Company's   
proprietary rights to its technology, including patent rights, to the same   
extent as the laws of the U.S.  
  
Although the Company believes that it has independently developed its   
technology and attempts to assure that its products do not infringe the   
proprietary rights of others, if infringement were alleged and proved, there   
can be no assurance that the Company could obtain necessary licenses on   
terms and conditions that would not have an adverse affect on the Company.    
The Company is not aware of any asserted claim that the Biojector 2000 or   
any product under development violates the proprietary rights of any person.  
  
If a dispute arises concerning the Company's technology, litigation   
that could result in substantial cost to and diversion of effort by the   
Company might be necessary to enforce the Company's patents, to protect the   
Company's trade secrets or know-how or to determine the scope of the    
proprietary rights of others.  Adverse findings in any proceeding could   
subject the Company to significant liabilities to third parties, require the  
Company to seek licenses from third parties or otherwise adversely affect   
the Company's ability to manufacture and sell its products.  


GOVERNMENTAL REGULATION  
  
The Company's products and manufacturing operations are subject to   
extensive government regulations, both in the U.S. and abroad.  In the U.S.,   
the Food and Drug Administration ("FDA") administers the Federal Food, Drug   
and Cosmetic Act (the "FFDCA") and has adopted regulations, including those   
governing the introduction of new medical devices, the observation of   
certain standards and practices with respect to the manufacturing and   
labeling of medical devices, the maintenance of certain records and the   
reporting of device-related deaths, serious injuries, and certain   
malfunctions to the FDA. Manufacturing facilities and certain Company   
records are also subject to FDA inspections. The FDA has broad discretion in   
enforcing the FFDCA and the regulations thereunder, and noncompliance can   
result in a variety of regulatory steps ranging from warning letters,    
product detentions, device alerts or field corrections to mandatory recalls,   
seizures, injunctive actions and civil or criminal penalties.  
  
The FFDCA provides that, unless exempted by regulation, medical devices   
may not be commercially distributed in the U.S. unless they have been    
cleared or approved by the FDA.  The FFDCA provides two basic review   
procedures for pre-market clearance or approval of medical devices.  Certain   
products qualify for a submission authorized by Section 510(k) of the FFDCA,   
wherein the manufacturer provides the FDA with a premarket notification   
("510(k) notification") of the manufacturer's intention to commence   
marketing the product.  The manufacturer must, among other things, establish   
in the 510(k) notification that the product to be marketed is substantially   
equivalent to another legally marketed product, (i.e., that it has the same   
intended use and that it as safe and effective as a legally marketed device   
and does not raise questions of safety and effectiveness that are different   
from those associated with the legally marketed device).  Marketing may   
commence when the FDA issues a letter finding substantial equivalence to   
such a legally marketed device.  The FDA may require, in connection with the   
510(k) submission, that it be provided with animal and/or human test   
results.  If a medical device does not qualify for the 510(k) procedure, the   
manufacturer must file a premarket approval ("PMA") application.  A PMA must   
show that the device is safe and effective and is generally a much more   
complex submission than a 510(k) notification typically requiring more   
extensive prefilling testing and a longer FDA review process.  
  
A 510(k) notification is required when a device is being introduced   
into the market for the first time.  A 510(k) notification is also required   
when the manufacturer makes a change or modification to an already marketed   
device that could significantly affect safety or effectiveness, or where   
there is a major change or modification in the intended use of the device.  
When any change or modification is made in a device or its intended use, the   
manufacturer is expected to make the initial determination as to whether the   
change or modification is of a kind that would necessitate the filing of a   
new 510(k) notification.  The FDA's regulations provide only limited   
guidance in making this determination.  

In April 1987, the Company received 510(k) marketing clearance from the   
FDA allowing the Company to market a hand-held CO2-powered jet injection   
system.  Although the Biojector 2000 system incorporates changes from the   
system with respect to which the Company's 1987 510(k) marketing clearance   
was received and expands its intended use, the Company made the   
determination that these were not major changes or modifications in intended    
use or changes in the device that could significantly affect the safety  
or effectiveness of the device and that, accordingly, the 1987 510(k)   
clearance permitted the Company to market the Biojector 2000 system in the   
U.S.  In  June 1994, the Company received clearance from the FDA under   
510(k) to market a version of its Biojector 2000 system in a configuration   
targeted at high volume injection applications. In October 1996, the Company 
received 510(k) clearance for a non-needle disposable vial access device. 
In March 1997, the Company received additional 510(k) clearance for certain 
enhancements to its Biojector 2000 system. The Company expects that the 
self-injection and other systems under development would require new 510(k) 
submissions.  See "Research and Product Development" and "Forward Looking 
Statements".  However, there can be no assurance that the FDA will concur 
with the Company's determination that the product can be cleared via a 
510(k) submission.  
  
The Company continues to seek arrangements with pharmaceutical companies to 
develop pre-filled Biojector syringe applications to permit the pharmaceutical 
companies to market their products packaged in Biojector prefilled 
containers.  See "Research and Product Development."  Before pre-filled 
Biojector syringes may be distributed for use in the U.S., certain FDA-
mandated stability tests may be required of those pharmaceutical companies.
Pre-filled syringes involve drugs packaged as a component of a medical 
device. It is current FDA policy that such pre-filled syringes,   
which are considered to be combination products, are evaluated by the FDA as   
drugs rather than medical devices.  Marketing of pre-filled syringes by   
pharmaceutical companies will require prior approval via a New or amended   
Drug Application ("NDA") or an Abbreviated New Drug Application ("ANDA").    
An NDA is a complex submission required to establish that a drug will be   
safe and effective for its intended uses.  An ANDA is a less detailed   
process which does not require, among other things, that the applicant   
provide complete reports of preclinical and clinical studies of safety and   
efficacy as are required for NDAs.  Assuming that the drugs used in the pre-  
filled syringes have previously been approved by the FDA for injection, the   
FDA will likely require that ANDAs, rather than NDAs, be submitted.  The   
Company believes that if a drug to be used in the Company's pre-filled   
syringe were already the subject of an approved NDA or ANDA for   
intramuscular or subcutaneous injection, the main issue affecting approval   
for use in the pre-filled syringe would be the adequacy of the syringe to   
store the drug, to assure its stability until used and to safely deliver  
the proper dose.  See "Forward Looking Statements" and "Risk Factors -   
Government Regulation."  
  
The FDA also regulates the Company's quality control and manufacturing   
procedures by requiring the Company and its contract manufacturers to   
demonstrate compliance with current Good Manufacturing Practice ("GMP")   
Regulations.  These regulations require, among other things, that (i) the  
manufacturing process must be regulated and controlled by the use of written   
procedures and (ii) the ability to produce devices which meet the   
manufacturer's specifications must be validated by extensive and detailed   
testing of every aspect of the process. They also require investigation of   
any deficiencies in the manufacturing process or in the products produced   
and detailed record-keeping.  Further, the FDA's interpretation and   
enforcement of these requirements has been increasingly strict in recent   
years and seems likely to be even more stringent in the future.  Failure to   
adhere to GMP requirements would cause the products produced to be   
considered in violation of the Act and subject to enforcement action.  The   
FDA monitors compliance with these requirements by requiring manufacturers   
to register with the FDA, and subjecting them to periodic FDA inspections of  
manufacturing facilities.  If the inspector observes conditions that might   
be violated, the manufacturer must correct those conditions or explain them   
satisfactorily, or face potential regulatory action that might include   
physical removal of the product from the marketplace.  


The FDA's Medical Device Reporting Regulation requires that the Company   
provide information to the FDA on the occurrence of any death or serious   
injuries alleged to have been associated with the use of the Company's   
products, as well as any product malfunction that would likely cause or   
contribute to a death or serious injury if the malfunction were to recur.    
In addition, FDA regulations prohibit a device from being marketed for  
unapproved or uncleared indications.  If the FDA believes that the company   
is not in compliance with these regulations, it can institute proceedings to   
detain or seize products, issue a recall, seek injunctive relief or assess   
civil and criminal penalties against such company.  
  
The use and manufacture of the Company's products are subject to OSHA   
and other federal, state and local laws and regulations relating to such   
matters as safe working conditions for healthcare workers and Company   
employees, manufacturing practices, environmental protection and disposal of   
hazardous or potentially hazardous substances and the policies of hospitals  
and clinics relating to compliance therewith.  There can be no assurance   
that the Company will not be required to incur significant costs to comply   
with such laws, regulations or policies in the future, or that such laws,   
regulations or policies will not increase the costs or restrictions related   
to the use of the Company's products or otherwise have a materially adverse   
effect upon the Company's ability to do business.  See "Risk Factors."  
  
Laws and regulations regarding the manufacture, sale and use of medical   
devices are subject to change and depend heavily on administrative    
interpretations.  There can be no assurance that future changes in   
regulations or interpretations made by the FDA, OSHA or other regulatory   
bodies, will not adversely affect the Company.  
  
Sales of medical devices outside of the United States are subject to foreign 
regulatory requirements.  The requirements for obtaining premarket clearance 
or approval by a foreign country may differ from those required for FDA 
clearance or approval. Devices having an effective 510(k) clearance or PMA
may be exported without further FDA authorization.  FDA authorization is 
generally required in order to export other medical devices.  
  

RESEARCH AND PRODUCT DEVELOPMENT  
  
Research and development efforts are focused on enhancing the Company's   
current product offerings and developing both new jet injection technology   
and new products.  The Company continues to use clinical, magnetic resonance   
imaging and tissue studies to determine the reliability and performance of   
new and existing products.  As of March 31, 1997, the Company's research and  
product development staff consisted of 5 employees.  During fiscal 1995,   
1996 and 1997, the Company spent $1.4 million, $1.5 million, and $1.3   
million, respectively, on research and development.  
  
In March 1994, the Company entered into an agreement with Schering AG,   
Germany, for the development of a self-injection device for delivery of   
Betaseron to multiple sclerosis patients. During fiscal 1995 through 1997, 
the Company developed prototypes to Schering specifications which were 
accepted by Schering. During fiscal 1997, the Company entered into a supply 
agreement with Schering AG and commenced activities related to full 
production of the self injector.  Schering loaned the Company a total of 
$1.6 million to purchase molds and tooling for production of the product.  
In January 1997, the Company received notice that its contract with Schering
AG would be cancelled.  Under provisions of the contract, Schering AG had 
the option of canceling the agreement if the FDA required extensive 
clinical studies beyond an originally planned safety study.  Schering AG 
received a review letter from the FDA which would have required Schering 
to conduct additional material clinical studies in order to use non-
traditional delivery mechanisms with its Betaseron (r) product. Under 
terms of the contract, Schering was required to convert its 
$1.6 million note due from Bioject into approximately 460,000 shares of 
Bioject common stock at a conversion price of $3.50 per share. In addition, 
$106,000 of accrued interest was converted into approximately 27,000 shares 
of Bioject common stock at a conversion price of $3.50 per share. Schering 
is obligated to pay Bioject for the cost of product ordered through the date
of cancellation of the contract. Under terms of the agreement, in April 1994,
Schering paid a one-time $500,000 licensing fee for access to the Company's 
technology and paid   $600,000 as its contribution toward Phase I of the 
development.  In October  1995 Schering paid $600,000 as its contribution 
toward Phase II development and $60,000 of additional costs associated with 
completion of Phase I.   During fiscal 1997, Schering paid $300,000 for 
Phase III development costs.   


In January 1995, the Company signed a joint development agreement with   
Hoffmann-La Roche to develop proprietary drug delivery systems for Roche   
products.  The agreement provides for Bioject to develop, manufacture and   
sell Biojector needle-free drug delivery systems designed to Roche   
specifications.  In return, Bioject has granted Roche exclusive worldwide   
rights to distribute these systems and their components for use with  
certain Roche products.  Hoffmann-La Roche Inc. is the United States   
affiliate of the multinational group of companies headed by Roche Holding of   
Basel, Switzerland, one of the world's leading research-intensive healthcare   
companies.  As of 1995 fiscal year end, the Company had commenced design of   
a prototype device and had agreed with Roche on product specifications.  
During fiscal 1996, the Company developed and delivered to Roche   
preproduction prototypes for testing and developed the clinical   
preproduction prototypes which were delivered to Roche in April 1996.  
As of March 31, 1997, the Company and Hoffmann-LaRoche were finalizing 
their submission to obtain regulatory approval to market the product.  
Hoffmann-LaRoche was also gathering marketing information in order to sign a 
supply agreement.  In  February 1995, Hoffmann-La Roche paid a one-time 
licensing fee totalling  $500,000, and the agreement provides that it will 
pay specified product development fees on an agreed upon schedule of which
$900,000 was paid in fiscal 1996 and $250,000 was paid in fiscal 1997.  
  
In addition to activities described above, the Company is seeking   
arrangements with pharmaceutical and biotechnology companies for the use of   
pre-filled syringes to eliminate the filling and measuring procedures   
associated with traditional injection of medications.  Before pre-filled   
Biojector syringes may be distributed for use in the U.S., these companies   
must commit to the packaging and distribution of their products in this   
manner and to the time and financial resources necessary for FDA review and   
approval. This process could be lengthy.  See "Business -- Government   
Regulation."  There can be no assurance that such companies will commit   
efforts to develop pre-filled packaging and pursue regulatory approval or   
that regulatory approval of pre-filled Biojector syringes will be obtained.  
  
The Company intends to continue research and development efforts   
designed to further its understanding of the physics and physiology of jet   
injection.  These efforts will include further clinical studies to   
demonstrate efficacy of jet injection and to evaluate new products and   
enhancements to the Company's existing products.  To advance these studies,   
in April 1994 the Company formed a Department of Clinical Affairs research   
group, which initiates and coordinates these studies.  
  
MANUFACTURING  
  
The Company assembles the Biojector 2000 and related syringes from   
components purchased from outside suppliers.  Prior to introduction of the   
Biojector 2000 system in 1993, the Company had not engaged in manufacturing   
on a commercial scale.  However, in connection with that introduction, the   
Company increased its manufacturing capabilities and built inventories to   
support anticipated product sales.  
  
Throughout fiscal 1994 and 1995, the Company's manufacturing processes   
were primarily manual.  These processes did not permit the Company to   
produce its products at costs which would allow it to operate profitably.    
During fiscal 1996, the Company implemented a plan to increase manufacturing   
capacity and refine production methods to meet anticipated future demand and   
to reduce product costs.  For the Biojector 2000, cost reduction efforts   
included converting from a two piece to a one piece housing, converting to   
continuous process manufacturing and implementing volume purchasing programs   
from suppliers.  For the Biojector syringes, these efforts included   
increasing supplier mold capacity and automating final assembly and   
packaging.  See "Risk Factors - Limited Manufacturing Experience, Need to   
Reduce Unit Cost."  

During fiscal 1997, the Company's manufacturing activities focused on 
retesting the devices repurchased from HMI to ensure their continuing 
compliance with new product standards and selective upgrade of certain of 
these units to current version configuration. Manufacturing also focused on
finalizing product engineering and bringing up the new self injector device 
and syringe manufacturing lines in advance of product launch.  
  
In order to succeed in expanding manufacturing capacity and reducing   
unit production cost, the Company must attract and retain qualified assembly   
workers and must establish and maintain relationships with suppliers that   
can deliver large numbers of components meeting applicable quality standards   
in a timely and reliable manner at acceptable prices.  
  
EMPLOYEES  
  
As of March 31, 1997, the Company had 39 full-time employees with 5   
employees engaged in research and product development, 10 in sales and   
marketing, 15 in manufacturing and 9 in administration. The Company engages   
a limited number of part-time consultants who participate in research   
activities.  The Company also employs temporary contract workers primarily   
for assembly operations, the number of which varies, depending upon   
production requirements.  As of March 31, 1997, there was one consultant, 8 
to 12 per diem nurses and one contract/temporary worker employed by the 
Company.  None of the Company's employees is represented by a labor union.  
  
PRODUCT LIABILITY  
  
The Company believes that its products reliably inject medications both   
subcutaneously and intramuscularly when used in accordance with product   
guidelines.  The Company's current insurance policies provide coverage at   
least equal to an aggregate limit of $6 million with respect to certain   
product liability claims.  The Company has not experienced any product  
liability claims to date.  There can be no assurance, however, that the   
Company will not become subject to such claims, that the Company's current   
insurance would cover such claims, or that insurance will continue to be   
available to the Company in the future.  The Company's business may be   
adversely affected by product liability claims.  
  
RISK FACTORS  
  
Investment in securities of the Company involves a high degree of risk.    
The following factors, among others, should be considered by investors.  

NEED FOR ADDITIONAL FINANCING. The Company believes that its current 
cash position and cash received from a private placement of common stock and 
warrants in June 1997, combined with revenues and other cash receipts will 
not be adequate to fund the Company's operations through the end of fiscal 
1998. The Company has identified a number of potential financing sources and 
is pursuing them aggressively. See "Forward Looking Statements". Even if the 
Company is successful in raising additional financing, unforeseen costs and 
expenses or lower than anticipated cash receipts from product sales or 
research and development activities could accelerate or increase the 
financing requirements. The Company has been successful in raising 
additional financing in the past and believes that sufficient funds will 
be available to fund future operations. See "Forward Looking Statements." 
However, there can be no assurance that the Company's efforts will be 
successful, and there can be no assurance that such financing will be 
available on terms which are not significantly dilutive to existing 
shareholders. Failure to obtain needed additional capital on terms 
acceptable to the Company, or at all, would significantly restrict the 
Company's operations and ability to continue product development and 
growth and materially adversely affect the Company's business. The Company 
has no banking line of credit or other established source of borrowing.  
The Company's independent accountants have qualified their opinion with 
respect to their audit of the Company's 1997 consolidated financial
statements as the result of doubts concerning the Company's ability to 
continueas a going concern in the absence of additional financing.

  
UNCERTAINTY OF MARKET ACCEPTANCE.   The Company's success will 
depend upon   market acceptance of its jet injection drug delivery system, 
the Biojector  2000 system, and, to other products under development. 
Currently, the dominant technology used for intramuscular and subcutaneous 
injections is the hollow-needle syringe.  Needle-syringes, while low in 
cost, have limitations, particularly relating to contaminated needlestick 
injuries.   Use of the Biojector 2000 system for intramuscular and 
subcutaneous injections virtually eliminates the associated risk of these 
injuries; however, the cost per injection is significantly higher.  As with 
any new technology, there can be no assurance that the Biojector 2000 system 
will compete successfully.  A previous jet injection system manufactured by 
the Company did not achieve market acceptance and is no longer being 
marketed.   The Biojector 2000 was introduced in January 1993.  To date 
the major portion of sales have been sales to HMI that were not placed in 
service and which the Company agreed to repurchase at a substantial discount
to the original selling price.  Failure of the Biojector 2000 system to 
gain market acceptance would have a material adverse effect on the 
Company's financial condition and results of operations.   

HISTORY OF LOSSES; UNCERTAIN PROFITABILITY.  Since its formation in 
1985,  the Company has incurred significant annual operating losses and 
negative cash flow.  At March 31, 1997 the Company had an accumulated deficit 
of $34.2 million.  The Company's revenues to date have been derived primarily   
from licensing and technology fees, and from product sales, which were   
principally sales to dealers for the stocking of inventories and to HMI.    
There can be no assurance that the Company will be able to generate   
significant revenues or achieve profitability.  See "Management's Discussion   
and Analysis of Financial Condition and Results of Operations."  
  

LIMITED MANUFACTURING EXPERIENCE; NEED TO REDUCE UNIT COST.  
The Company has  limited experience manufacturing its products in commercial 
quantities.  The  Company has increased its production capacity for the 
Biojector 2000 system  through automation of, and changes in, production 
methods.  The current cost  per injection of the Biojector 2000 system is 
substantially higher than that  of traditional needle-syringes, its principal
competition.  A key element of the Company's business strategy is to reduce 
the overall system cost through automating production and packaging. The 
Company has experienced and may continue to experience setbacks and delays
in its cost reduction efforts including failure to deliver reduced cost parts 
to specifications.  There can be no assurance that the Company will be able 
to develop and implement effective high volume production or achieve necessary 
unit cost reductions. Failure to do either would adversely affect the 
Company's financial condition and results of operations.  See "Management's 
Discussion and Analysis of Financial Condition and Results of Operation" and  
"Manufacturing."  
  
GOVERNMENTAL REGULATION.  The Company's products and manufacturing  
operations are subject to extensive government regulation,
both in the U.S.  and abroad.  In the U.S., the development, manufacture,
marketing and promotion of medical devices are regulated by the Food and 
Drug Administration ("FDA") under the Federal Food, Drug, and Cosmetic Act   
("FFDCA").  In 1987, the Company received clearance from the FDA under   
Section 510(k) of the FFDCA to market a hand-held CO2-powered jet injection   
system.  The FFDCA provides that new premarket notifications under Section   
510(k) of the FFDCA are required to be filed when, among other things, there   
is a major change or modification in the intended use of a device or a   
change or modification to a legally marketed device that could significantly   
affect its safety or effectiveness. Although the Biojector 2000 system 
incorporates changes from the system with respect to which the Company's 
1987 510(k) marketing  clearance was received and expands its intended use, 
the Company made the  determination that these were not major changes or 
modifications in intended use or changes in the device that could 
significantly affect the safety or effectiveness of the device and that, 
accordingly, the 1987 510(k) clearance permitted the Company to market the 
Biojector 2000 system in the U.S.  In June 1994, the Company received 
clearance from the FDA under 510(k) to market a version of its Biojector 2000 
system in a configuration targeted at high volume injection applications. 
In October 1996, the Company received 510(k) clearance for a non-needle 
disposable vial access device. In March 1997, the Company received FDA 
510(k) clearance to market the Biojector 2000 incorporating certain 
enhancements to the product.

Future changes to manufacturing procedures could necessitate the filing of a   
new 510(k) notification.  Also, future products, product enhancements or   
changes, or changes in product use may require clearance under Section   
510(k), or they may require FDA premarket approval ("PMA") or other   
regulatory approvals.  PMAs and these other regulatory approvals generally   
involve more extensive prefilling testing that a 510(k) clearance and a   
longer FDA review process.  Under current FDA policy, applications involving   
prefilled syringes would he evaluated by the FDA as drugs rather than   
devices, requiring NDAs or ANDAs.  See "Governmental Regulation."  
Depending on the circumstances, drug regulation can be more bureaucratic and 
time consuming than device regulation.  
  
FDA regulatory processes are time consuming and expensive, and there can be   
no assurance that product applications submitted by the Company will be   
cleared or approved by the FDA.  In addition, the Company's products must be   
manufactured in compliance with Good Manufacturing Practices ("GMP")   
specified in regulations under the FDA Act.  The FDA has broad discretion in   
enforcing the FDA Act, and noncompliance with the Act could result in a   
variety of regulatory actions ranging product detentions, device alerts  
or field corrections, to mandatory recalls, seizures, injunctive actions,   
and civil or criminal penalties.  
  
Distribution of the Company's products in countries other than the U.S. may   
be subject to regulation in those countries.  An application was made to the   
Japan Ministry of Health and Welfare to obtain necessary approvals to market   
the Biojector 2000 system in Japan which was not carried to completion by   
the Company's then Japanese distributor.  See "Governmental Regulation."  
  
UNCERTAINTY IN HEALTHCARE INDUSTRY; GOVERNMENT HEALTHCARE REFORM.  
The healthcare industry is subject to changing political, economic and 
regulatory influences that may affect the procurement practices and 
operations of healthcare facilities. During the past several years, the   
healthcare industry has been subject to increased government regulation of   
reimbursement rates and capital expenditures.  Among other things, third   
party payers are increasingly attempting to contain healthcare costs by  
limiting both coverage and reimbursement levels for healthcare products and   
procedures.  Because the price of the Biojector 2000 system exceeds the   
price of needle injection systems, cost control policies of third party   
payers, including government agencies, may adversely affect use of the   
Biojector 2000 system.  
  
DEPENDENCE ON THIRD-PARTY RELATIONSHIPS.  The Company is dependent on third  
parties for distribution of the Biojector 2000 system to certain market 
segments, for the manufacture of component parts, and for assistance 
with the development and distribution of its future Betaseron self-injection 
and application specific systems.  
  
The Company intends to seek relationships to distribute to the physician   
office market in the future. Past dealer relationships have not been   
successful. There can be no assurance that the Company's  future dealers   
will provide sufficient sales support to establish the Company's current   
product.  See "Marketing and Competition."  
  
The Company's current manufacturing processes for the Biojector 2000 jet   
injector and disposable syringes consist primarily of assembly of component   
parts supplied by outside suppliers. Certain of these components are   
currently obtained from single sources, with some components requiring   
significant production lead times.  In the past, the Company has experienced   
delays in the delivery of certain components, although to date no such   
delays have had a material adverse effect on the Company's operations.    
There can be no assurance that the Company will not experience delays in the   
future, or that such delays would not have a material adverse effect on the   
Company's financial condition and result of operations.  See    
"Manufacturing."  

The Company has entered into agreements with certain major pharmaceutical   
companies for development and distribution of its jet injection systems.    
These companies have the right to terminate these agreements at certain   
phases as defined in the agreements.  There can be no assurance these   
companies interest and participation in the projects will continue.  Failure   
to receive additional funding from these companies could adversely affect   
the development and production of the products involved and,   
correspondingly, the Company's financial condition and results of   
operations.  See "Research and Product Development."  
  
ABILITY TO MANAGE GROWTH.  If the Company's products achieve 
market acceptance, the Company expects to achieve rapid growth. This growth   
strategy will require expanded customer services and support, increased   
personnel throughout the Company, expanded operational and financial   
systems, and the implementation of new control procedures.  There can be no   
assurance that the Company will be able to attract qualified personnel or   
successfully manage expanded operations.  As the Company expands, it may   
from time to time experience constraints that would adversely affect its   
ability to satisfy customer demand in a timely fashion. Failure to manage   
growth effectively could adversely affect the Company's financial condition   
and results of operations.  
  
COMPETITION.  The medical equipment market is highly competitive and   
competition is likely to intensify.  The Company's products compete   
primarily with traditional needle-syringes, "safety syringes" and also with   
other alternative drug delivery systems. In recent years, some needle-free 
self injectors have also gained some market prominence including signing of 
certain corporate partnerships.  While the Company believes its products 
provide a superior drug delivery method, there can be no assurance that the 
Company will be able to compete successfully with existing drug delivery 
products.  Many of the Company's competitors have longer operating histories 
as well as substantially greater financial, technical, marketing and customer 
support resources than the Company.  There can be no assurance  that one or 
more of these competitors will not develop an alternative drug  delivery system 
that competes more directly with the Company's products, or that the Company's 
products would be able to compete successfully with such a product.  
See "Marketing and Competition."  
  
DEPENDENCE ON SINGLE TECHNOLOGY.  The Company's strategy has been to 
focus its development and marketing efforts on its jet injection technology.  
This focus renders the Company particularly sensitive to competing products 
and alternative drug delivery systems.  The Company believes that healthcare   
providers' desire to minimize the use of the traditional needle-syringe has   
stimulated development of a variety of alternative drug delivery system such   
as "safety syringes," jet injection systems and transdermal diffusion   
"patches."  In addition, pharmaceutical companies frequently attempt to   
develop drugs for oral delivery instead of injection.  
  
While the Company believes that for the foreseeable future there will   
continue to be a significant need for injections, there can be no assurance   
that alternative drug delivery methods will not be developed which are   
preferable to injection.  See "Marketing and Competition."  
  
PATENTS AND PROPRIETARY RIGHTS.  The Company relies on a combination
of trade secrets, confidentiality agreements and procedures, and patent   
prosecution to protect its proprietary technologies.  The Company has been   
granted seven patents in the United States and two patents in certain other   
countries covering certain technology embodied in its current jet injection   
system and certain manufacturing processes.  Additional patent applications   
are pending in the U.S and certain foreign countries.  There can be no   
assurance that the claims contained in any patent application will be   
allowed, or that any patent will provide adequate protection for the   
Company's products and technology.  In the absence of patent protection, the   
Company may be vulnerable to competitors who attempt to copy the Company's  
products or gain access to its trade secrets and know-how. In addition, the   
laws of foreign countries may not protect the Company's proprietary rights   
to this technology to the same extent as the laws of the U.S.  The Company   
believes that it has independently developed its technology and attempts to   
ensure that its products do not infringe the proprietary rights of others,   
and the Company knows of no infringement claims. However, any such claims   
could have a material adverse affect on the Company's financial condition   
and results of operations.  See "Patents and Proprietary Rights."  
  
PRODUCT LIABILITY.  Producers of medical devices may face substantial   
liability for damages in the event of product failure or if it is alleged   
the product caused harm.  The Company currently maintains product liability   
insurance and has not experienced any product liability claims to date.    
There can be no assurance, however, that the Company will not be subject to  
such claims, that the Company's current insurance would cover such claims   
and that adequate insurance will continue to be available on acceptable   
terms to the Company in the future.  The Company's business could be   
adversely affected by product liability claims.  See "Product Liability."  
  
DEPENDENCE UPON KEY EMPLOYEES.  The Company's success is dependent 
upon the retention of its executive officers and other key employees.  
Competition exists for qualified personnel, and the Company's success will 
depend in part upon attracting and retaining such personnel.  Failure in 
these efforts ould have a material adverse effect on the Company's business, 
financial condition or results of operations.  
  
SHARES ELIGIBLE FOR FUTURE SALE. In November and December of 1995,
the Company completed a private placement of 2,303,009 units (each unit 
representing one share of common stock and a warrant to purchase one share of 
common stock).  The Company also granted a warrant to its placement agent 
in the private placement to purchase 137,086 shares of common stock.  
The shares issued in the 1995 private placement were registered for resale 
on a Registration Statement on Form S-3. The Company also granted 
registration rights with respect to the shares issuable upon exercise of the 
warrants.  In December 1996, the Company completed a private placement of 
3,434,493 units (each unit representing one share of common stock and a 
warrant to purchase one share of common stock).  The Company also granted a 
warrant to its placement agent in the private placement to purchase 156,000 
shares of common stock. The shares issued in the 1996 private placement and 
the underlying shares issuable upon exercise of the warrants were registered 
for resale on a Form S-3 Registration Statement.  In June 1997, the Company 
completed a private placement of 1,744,186 units (each unit representing one 
share of common stock and a warrant to purchase one-half share of common 
stock). The Company has an obligation to seek registration on Form S-3 for 
the 1997 private placement shares and, if possible, the common shares 
underlying the warrants.  Sales of substantial numbers of shares of 
common stock in the public market, or the availability of such shares for 
sale, could adversely affect the market price for the common stock and make 
it more difficult for the Company to raise funds through equity offerings in 
the future.  
  
POSSIBLE ADVERSE EFFECTS ON TRADING MARKET. The Common Stock is 
quoted on the NASDAQ National Market.  There are a number of continuing 
requirements that must be met in order for the Common Stock offered hereby 
to remain eligible for quotation on the NASDAQ National Market or the NASDAQ 
Small Cap Market. In November 1996, NASDAQ approved changes to its 
quantitative and qualitative standards for issuers listing on NASDAQ, 
subject to public comment and approval by the Securities and Exchange 
Commission.  Among the proposed changes are the elimination of the alternative 
test for issuers failing to meet the minimum bid price of $1.00 and an 
increase in the quantitative standards for both the NASDAQ National Market 
and the NASDAQ SmallCap Market. The failure to meet these maintenance criteria 
in the future could result in the delisting of the Company's Common Stock 
from NASDAQ.  In such event, trading, if any, in the Common Stock may then 
continue to be conducted in the non-NASDAQ over-the-counter market.  As a 
result, an investor may find it more difficult to dispose of, or to obtain 
accurate quotations as to the market value of, the Company's Common Stock.  
In addition, if the Common Stock were delisted from trading on NASDAQ and the   
trading price of the Common Stock were less than $5.00 per share, trading in  
the Common Stock would be subject to the requirements of certain rules   
promulgated under the Exchange Act, which require broker-dealers to make   
additional disclosures and to implement additional procedures in connection   
with any trades involving a stock defined as a penny stock. The additional   
burdens imposed upon broker-dealers may discourage broker-dealers from   
effecting transactions in penny stocks, which could reduce the liquidity of  
the shares of Common Stock and thereby have a material adverse effect on the   
trading market for the securities.  
  
POSSIBLE VOLATILITY OF STOCK PRICE.  The market for the Company's 
common  stock and for the securities of other early stage, small market-  
capitalization companies is highly volatile.  The Company believes that   
factors such as quarter-to-quarter fluctuations in financial results, new   
product introductions by the Company or its competition, public   
announcements, changing regulatory environments, sales of Common Stock by   
certain existing shareholders and substantial product orders could   
contribute to the volatility of the price of the Company's Common Stock,  
causing it to fluctuate dramatically.  General economic trends such as   
recessionary cycles and changing interest rates may also adversely affect   
the market price of the Company's Common Stock. See  "Market for the   
Registrant's Common Equity and Related Stockholder Matters."  
  
Item 2.     PROPERTIES  
  
The Company's principal offices are located in Portland, Oregon in    
approximately 24,000 square feet of leased office and manufacturing space   
under a lease which expires in September 2002.  The monthly minimum lease   
obligation for this facility is approximately $15,000.  These facilities   
include the Company's sales and administration offices and equipment,   
research and engineering facilities, a clean room assembly area, assembly  
line, testing facilities and a warehouse area.  
  
The Company leases additional warehouse space totalling approximately 
5,000 square feet for finished goods storage and shipments to customers.  
This lease, which also expires in September 2002, has minimum monthly lease 
obligations totalling $1,900.  
  
The Company believes its current facilities will be sufficient to   
support its operations for the next 2-3 fiscal years.  As the Company 
requires additional space to accommodate growth in its sales and 
manufacturing activities, it is the Company's intention to lease additional 
facilities adjacent to or near its present operations.  The Company believes 
that, if necessary, it will be able to obtain facilities at rates and under 
terms comparable to those under the current leases.  
  
Item 3.     LEGAL PROCEEDINGS  
  
     None  
  
Item 4.     SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS  
  
     None.  
  
  
				  PART II  
  
Item 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY AND 
RELATED STOCKHOLDER MATTERS  
  
The Company's Common Stock is traded on the NASDAQ National Market   
under the Symbol "BJCT."  The following table sets forth the high and low 
closing sale prices of the Company's Common Stock on the NASDAQ National 
Market.
  
  
						 High       Low  
						 _____     _____  
                                                       

Fiscal year Ended March 31, 1995:  
  
   First Quarter                                 $3.00     $2.00  
   Second Quarter                                 4.13      3.25  
   Third Quarter                                  3.63      2.81  
   Fourth Quarter                                 2.50      1.50  
  
Fiscal Year Ended March 31, 1996:  
  
   First Quarter                                  3.00      1.44  
   Second Quarter                                 2.97      1.19  
   Third Quarter                                  2.81      1.81  
   Fourth Quarter                                 1.94      1.25  

Fiscal Year Ended March 31, 1997:  
  
   First Quarter                                  1.41      1.28
   Second Quarter                                 1.03      0.97
   Third Quarter                                  0.78      0.75
   Fourth Quarter                                 0.78      0.63

  
  
The closing sale price on May 30, 1997, as reported on the NASDAQ National   
Market, was $0.91 per share.  
  
The Company has declared no dividends during its history and has no   
intention of declaring a dividend in the foreseeable future. As of 
May 30, 1997 the number of shareholders of record of the Company's 
Common Stock was 19,540,413.  

Item 6.     SELECTED CONSOLIDATED FINANCIAL DATA  
  
FINANCIAL DATA  
  
The statement of operations and balance sheet data set forth below for   
the five fiscal years in the period ended March 31, 1997 have been derived   
from the consolidated financial statements of the Company.  The selected   
consolidated financial data set forth below should be read in conjunction   
with "Management's Discussion and Analysis of Financial Condition and   
Results of Operations" and with the detailed consolidated financial   
statements and notes thereto included elsewhere in this Report.  
  
SUMMARY FINANCIAL INFORMATION  
(in thousands, except per share data)  
  
  
					    YEAR ENDED MARCH 31,  
				   1997     1996     1995     1994    1993    
				  ______   ______   ______   ______   ______  
                                                         
Statement of Operations Data:  
  
   Revenues                     $2,235    $4,209   $2,924   $1,463   $1,146   
   Operating expenses            6,531     9,640    8,580    5,858    4,449   
   Net loss                     (4,296)   (5,431)  (5,656)  (4,395)  (3,303)    
   Net loss per share            (0.26)    (0.39)   (0.43)   (0.39)   (0.34)    
   Shares used in per  
   share calculation            16,705    14,074   13,167   11,230    9,686     
  
  
  
					       AS OF MARCH 31,  
				  1997      1996     1995     1994    1993     
				 ______   ______   ______   ______   ______  
                                                         
  
Balance Sheet Data:  
  
   Working capital               $2,858    $4,327   $6,404   $12,593  $4,264     
   Total assets                   7,088     7,519    9,498    13,836   5,727     
   Long-term debt                     -         -        -         -       -   
   Shareholders' equity           5,766     6,027    7,964    13,377   4,752     
  
  
The Company has declared no dividends during its history and has no   
intention of declaring a dividend in the foreseeable future.  
  

Item 7.     MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL  
	    CONDITION AND RESULTS OF OPERATIONS  
  
OVERVIEW  
  
Operating losses have resulted in an accumulated deficit of approximately $34.3 
million as of March 31, 1997.  In fiscal 1995 and 1996, the Company incurred 
significantly increased costs associated with the production and sale of the 
Biojector 2000 system, including sales and marketing efforts, manufacturing 
ramp-up and inventory build-up.  The Company has been working on a product 
cost reduction program which commenced phase-in during fiscal 1996 and results 
from the initial phase of which were reflected in fiscal 1997 operating 
performance. The Company's ability to achieve and sustain profitability will 
depend in part upon customer acceptance of the Biojector 2000 system, sustained 
product performance, implementing additional product cost reductions and 
attaining revenues sufficient to support profitable operations.  
  
In August 1994, Bioject signed an agreement with Health Management,   
Inc. (HMI), granting HMI exclusive rights to purchase Bioject's Needle-Free   
Injection Management System (trademark), the Biojector 2000, for use in the   
home healthcare market. In return for HMI's commitment to purchase a minimum   
of 8,000 Biojector units over the ensuing two years, the Company granted   
volume pricing discounts to HMI.  During the term of the contract, the   
selling price of Biojectors to HMI exceeded their standard cost.  During   
fiscal 1995 and 1996, the Company sold approximately 2,100 and 4,300   
Biojectors to HMI for total sales revenue including syringes of $1.1 million   
and $2.2 million, respectively. HMI did not place the great majority of   
these Biojectors with patients pending completion of negotiations with   
pharmaceutical companies for certain pricing concessions for medication to   
be administered with the Biojectors.  In January 1996 HMI requested that   
Bioject suspend shipments to HMI.  In February 1996, the Company learned   
from HMI's press releases that HMI expected to default under its loans, to   
take significant write-offs for accounts receivable and inventories, planned   
operational consolidations, and would restate certain prior period financial  
statements.  In fiscal 1997, although not obligated to do so, the   
Company agreed to repurchase certain of the HMI inventories, including up to   
6,000 Biojector units, for cash and forgiveness of accounts receivable   
totalling $660,000.  The repurchase of these inventories was at a   
substantial discount to the original selling price to HMI.  
  
In March 1994, the Company entered into an agreement with Schering AG,   
Germany, for the development of a self-injection device for delivery of   
Betaseron(R) to multiple sclerosis patients. During fiscal 1995, the Company   
developed a proof-of-concept prototype and demonstrated this prototype to   
Schering.  The Company and Schering finalized product specifications.  The  
Company also commenced development of the preproduction clinical prototype.    
During fiscal 1996, the Company delivered the preproduction clinical   
prototypes to Schering and worked on finalizing the production prototype   
design. During fiscal 1997, the Company entered into a supply agreement with 
Schering AG and commenced activities related to full production of the self 
injector.  Schering loaned the Company a total of $1.6 million to purchase 
molds and tooling for production of the product.  In January 1997, the Company 
received notice that its contract with Schering AG would be cancelled.  Under 
provisions of the contract, Schering AG had the option of canceling the 
agreement if the FDA required extensive clinical studies beyond an originally 
planned safety study.  Schering AG received a review letter from the FDA which 
would have required Schering to conduct additional material clinical studies 
in order to use non-traditional delivery mechanisms with its Betaseron(R) 
product. Under terms of the contract, Schering was required to convert its 
$1.6 million note due from Bioject into approximately 460,000 shares of 
Bioject common stock at a conversion price of $3.50 per share.  In addition, 
$106,000 of accrued interest was converted into approximately 27,000 shares 
of Bioject common stock at a conversion price of $3.50 per share.  
Approximately 487,000 shares of Bioject stock are held by Schering AG.  In 
addition, Schering is obligated to pay Bioject for the cost of product ordered 
through the date of cancellation of the contract.
 
In January 1995, the Company signed a joint development agreement with   
Hoffmann-La Roche to develop proprietary drug delivery systems for Roche   
products.  The agreement provides for Bioject to develop, manufacture and   
sell Biojector needle-free drug delivery systems designed to Roche   
specifications.  In return, Bioject has granted Roche exclusive worldwide   
rights to distribute these systems and their components for use with certain   
Roche products.  Hoffmann-La Roche Inc. is the United States affiliate of   
the multinational group of companies headed by Roche Holding of Basel,   
Switzerland, one of the world's leading research-intensive healthcare   
companies.  As of 1995 fiscal year end, the Company had commenced design of   
a prototype device and had agreed with Roche on product specifications.   
During fiscal 1996, the Company developed and delivered to Roche   
preproduction prototypes for testing and developed the clinical   
preproduction prototypes which were delivered to Roche in April 1996.  As of 
March 31, 1997, the Company and Hoffmann-LaRoche were finalizing their 
submission to obtain regulatory approval to market the product.  Hoffmann-
LaRoche was also gathering marketing information in order to sign a supply 
agreement.  In February 1995, Hoffmann-La Roche paid a one-time licensing 
fee totalling $500,000 and the agreement provides that it will pay specified 
product development fees on an agreed upon schedule of which $900,000 was 
paid in fiscal 1996 and $250,000 was paid in fiscal 1997.  

Throughout fiscal 1994 and 1995, the Company's manufacturing processes   
were primarily manual.  These processes did not permit the Company to   
produce its products at costs which would allow it to operate profitably.    
During fiscal 1996, the Company implemented a plan to increase manufacturing   
capacity and refine production methods to meet anticipated future demand and   
to reduce product costs.  For the Biojector 2000, cost reduction efforts   
included converting from a two piece to a one piece housing, converting to   
continuous process manufacturing and implementing volume purchasing programs   
from suppliers.  For the Biojector syringes, these efforts included    
increasing supplier mold capacity and automating final assembly and   
packaging. During fiscal 1997, the Company's manufacturing activities  
focused on retesting the devices repurchased from HMI to ensure their   
continuing compliance with new product standards and elective upgrade of   
certain of these units to current version configuration.  Manufacturing    
also focused on finalizing product engineering and on planning   
for, designing and bringing up the new self injector device and syringe   
manufacturing lines in advance of product launch.  
  
The Company's revenues to date have not been sufficient to cover   
operating expenses.  However, the Company believes that if its products   
achieve market acceptance and the volume of sales increases, and its product   
costs are reduced, its costs of goods as a percentage of sales will decrease   
and eventually the Company will generate net income.  See "Forward Looking   
Statements" and "Business - Risk Factors." The level of sales required to   
generate net income will be affected by a number of factors including the   
pricing of the Company's products, its ability to attain efficiencies that   
can be attained through volume and automated manufacturing, and the impact   
of inflation on the Company's manufacturing and other operating costs.    
There can be no assurance that the Company will be able to successfully  
implement its manufacturing cost reduction program or sell its products at   
prices or in volumes sufficient to achieve profitability or offset increases   
in its costs should they occur.  

Revenues and results of operations have fluctuated and can be expected   
to continue to fluctuate significantly from quarter to quarter and from year   
to year.  Various factors may affect quarterly and yearly operating results   
including (i) length of time to close product sales, (ii) customer budget   
cycles, (iii) implementation of cost reduction measures, (iv) uncertainties   
and changes in purchasing due to third party payor policies and proposals   
relating to national healthcare reform, (v) timing and amount of payments   
under technology development agreements and (vi) timing of new product   
introductions by the Company and its competition.  
  
In the future, the Company may incur a non-cash charge to compensation   
expense in connection with the issuance of 100,000 shares of Common Stock to   
the Company's Chief Executive Officer. Under terms of his employment   
agreement, the Company's Chairman will receive 100,000 shares of common   
stock when the Company first achieves two consecutive quarters of positive   
earnings per share.  Upon issuance of such shares the Company will record a  
non-cash charge to compensation at the fair market value of the stock on the   
last day of the quarter in which the shares are earned.  
  
During the next fiscal year, the Company will continue to focus its   
efforts on expanding sales, reducing the cost of its products, developing   
a 1.5 ml. injector for Hoffmann-La Roche, pursuing additional alliances with 
pharmaceutical companies and conserving its fiscal resources.  The Company 
does not expect to report net income from operations in fiscal 1998. 
See "Forward Looking Statements" and "Risk Factors."  
  
RESULTS OF OPERATIONS  
  
Product sales increased from $1.5 million in fiscal 1995 to $3.1 million 
in fiscal 1996 and declined to $1.3 in fiscal 1997.  Sales in fiscal 1995 
consisted of $1.1 million of sales to Health Management Inc., and the 
remainder to hospitals, large clinics, individual physician offices and 
certain selected distributors.  Sales in fiscal 1996 consisted of $2.3 million 
of sales to HMI with the remainder primarily to public health and flu 
immunization clinics.  Sales in fiscal 1997, consisted of $1.1 
million of sales to public health and flu immunization clinics with the 
balance to a strategic partner.
  
License and technology fees varied from $1.4 million in fiscal 1995 to $1.2 
million in fiscal 1996 and $966,000 in fiscal 1997. The fiscal 1995 fees 
included a one-time $500,000 licensing fee for access to the Company's 
technology received from Schering and a similar one-time $500,000 licensing 
fee received from Hoffmann-La Roche with the balance of the fiscal 1995 fees 
consisting of product development revenues recognized in connection with the 
Schering agreement.  The fiscal 1996 and 1997 fees consisted principally of 
product development  revenues recognized for work performed under the Schering 
and Hoffmann-La Roche agreements.  
  
Manufacturing expense consists of the costs of product sold and manufacturing 
overhead expense related to excess manufacturing capacity.  The total of these 
costs varied from $3.4 million in fiscal 1995 to $5.2 million in fiscal 1996 
and $2.2 million in fiscal 1997 due in part to changes in sales and, 
therefore, to changes in the total costs of product sold.  The increase from 
1995 to 1996 also reflects increased regulatory and quality assurance staff 
to support the higher level of manufacturing and increased depreciation 
expense associated with automated assembly equipment installed during fiscal 
1996.  The decrease in expense from fiscal 1996 to 1997 reflects reductions in 
materials and labor for injectors and syringes and reductions in fixed and 
variable manufacturing overhead expense. Fixed manufacturing overhead 
totalled $1.3 million, $1.9 million and $1.5 million in fiscal 1995, 1996 
and 1997, respectively.

Research and development expense increased slightly from to $1.4 million in 
fiscal 1995 to $1.5 million in fiscal 1996 and then decreased to $1.3 million 
in fiscal 1997.  Fiscal 1995 expenditures related to work associated with 
development of the Schering device and to initial work on the Hoffmann-La 
Roche device.  Fiscal 1996 expenditures related entirely to work performed 
under the Schering and Hoffmann-La Roche agreements.  Fiscal 1997 expenditures 
related to final design and transfer to manufacturing of the Schering device 
and additional development work on the Hoffmann-LaRoche system.  Costs vary 
from year to year depending on product activity.  
  
Selling, general and administrative expense totalled $4.2 million, $3.2 
million and $3.2 million in fiscal 1995, 1996 and 1997, respectively. Fiscal 
1995 included expenses incurred in connection with the chief executive 
officer transition totalling approximately $780,000 (or $0.06 per share) and 
to higher levels of legal, insurance, bad debt and certain 
promotional expenses.  The decrease in fiscal 1996 resulted from planned 
reductions in overhead personnel.  Sales and marketing expenses comprise 
slightly more than 50% of selling, general and administrative expenses in 
fiscal 1996 and 1997.
  
Other income consists of earnings on available cash balances. Other income 
varied as a result of changes in cash balances and interest rates from year 
to year.  
  
LIQUIDITY AND CAPITAL RESOURCES  
  
Since its inception in 1985, the Company has financed its operations, working
capital needs and capital expenditures primarily from private placements of 
securities, exercises of stock options, proceeds received from its initial 
public offering in 1986, proceeds received from a public offering of Common 
Stock in November 1993, licensing and technology revenues and more recently 
from sales of products.  Net proceeds received upon issuance of securities 
from inception through March 31, 1997 totalled approximately $40.0 million.  
The Company has no long-term debt.  

Cash, cash equivalents and marketable securities totalled $4.1 million at 
March 31, 1996 and $2.1 million at March 31, 1997, which represented a 
decrease of $2.0 million from 1996 to 1997.  The decrease resulted from 
operating losses and capital expenditures offset in part by net proceeds 
from a private placement of common stock and warrants in December 1996 and 
of long-term debt borrowing from Schering including accrued interest 
which was converted into 487,390 shares of common stock in February 1997.  
In June 1997, the Company completed private placement of its common stock 
and warrants totalling $750,000.

Inventories increased from $1.3 million at March 31, 1996 to $1.7 million at 
March 31, 1997 due to the build-up of inventories to support anticipated future 
product sales and the repurchase of inventories from HMI.

The Company has fixed commitments for facilities rent and equipment leases 
which total approximately $260,000 for fiscal 1998.

The Company expended approximately $1.6 million for capital equipment in 
fiscal 1997.  Substantially all of these expenditures related to ramp-up of 
manufacturing for the Schering product launch. These assets continue to be 
carried at their cost on the Company's balance sheet because the product is 
suitable for other home injection applications which the Company is pursuing. 
The Company expects to expend approximately $50,000 on non-manufacturing 
capital equipment additions in fiscal 1998.

The Company believes that its current cash position and cash received from a 
private placement of common stock and warrants in June 1997, combined with 
revenues and other cash receipts will not be adequate to fund the Company's 
operations through the end of fiscal 1998. The Company has identified a 
number of potential financing sources and is pursuing them aggressively. 
See "Forward Looking Statements." Even if the Company is successful in 
raising additional financing unforeseen costs and expenses or lower than 
anticipated cash receipts from product sales or research and development 
activities could accelerate or increase the financing requirements. The 
Company has been successful in raising additional financing in the past and 
believes that sufficient funds will be available to fund future operations. 
See "Forward Looking Statements."  However, there can be no assurance that 
the Company's efforts will be successful, and there can be no assurance that 
such financing will be available on terms which are not significantly dilutive 
to existing shareholders. Failure to obtain needed additional capital on 
terms acceptable to the Company, or at all, would significantly restrict the 
Company's operations and ability to continue product development and growth 
and materially adversely affect the Company's business.  The Company has no 
banking line of credit or other established source of borrowing.  The Company's 
independent accountants have qualified their opinion with respect to their 
audit of the Company's 1997 consolidated financial statements as the result 
of doubts concerning the Company's ability to continue as a going concern in 
the absence of additional financing.
  
  

Item 8.  CONSOLIDATED FINANCIAL STATEMENTS AND SUPPLEMENTARY 
DATA

		  TABLE OF CONTENTS TO FINANCIAL STATEMENTS  

Report of Independent Public Accountants

Consolidated Balance Sheets at March 31, 1997 and 1996

Consolidated Statements of Operations for the years ended
  March 31, 1997, 1996 and 1995

Consolidated Statements of Shareholders' Equity for the years
  ended March 31, 1997, 1996 and 1995


Consolidated Statements of Cash Flows for the years ended 
  March 31, 1997, 1996 and 1995

Notes to Consolidated Financial Statements

Supplementary Data (none required)

  

		 REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS  
  
To the Board of Directors and Shareholders of Bioject Medical 
Technologies Inc:  
  
We have audited the accompanying consolidated balance sheets of Bioject   
Medical Technologies Inc. (an Oregon corporation) and subsidiaries as of   
March 31, 1997 and 1996, and the related consolidated statements of   
operations, shareholders' equity and cash flows for each of the three years   
in the period ended March 31, 1997.  These financial statements are the   
responsibility of the Company's management. Our responsibility is to   
express an opinion on these financial statements based on our 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 Bioject Medical   
Technologies Inc. and subsidiaries, as of March 31, 1997 and 1996, and the   
results of their operations and their cash flows for each of the three years   
in the period ended March 31, 1997, 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, at March 31, 1997, has an accumulated deficit of $34.3 
million that raises substantial doubt about the Company's ability to 
continue as a going concern. Management's plan in regards to these matters 
is also described in Note 1.  The financial statements do not include any 
adjustments relating to recoverability and classification of asset
carrying amounts that might result should the Company be unable to continue 
as a going concern.
  
/S/ ARTHUR ANDERSEN LLP  
  
Portland, Oregon  
  
May 2, 1997 (except with respect to the matter discussed in Note 7 for 
	     which the date is June 18, 1997)  

  
  
	       BIOJECT MEDICAL TECHNOLOGIES INC. AND SUBSIDIARIES  
			  CONSOLIDATED BALANCE SHEETS  
  
  
							   March 31,  
						      1997           1996  
						  ____________    __________  
                                                              
		   ASSETS  
CURRENT ASSETS:  
   Cash and cash equivalents                      $  2,116,478    $ 3,098,251  
   Securities available for sale                            -         993,056
   Accounts receivable, net of allowance for  
     doubtful accounts of $27,500 and $55,000,  
     respectively                                      311,856        424,859 
   Inventories                                       1,706,456      1,255,945  
   Other current assets                                 45,222         45,714  
						  ____________    ___________  
       Total current assets                          4,180,012      5,817,825  
						  ____________    ___________  
  
PROPERTY AND EQUIPMENT, at cost:  
   Machinery and equipment                           1,897,174      1,428,001 
   Production molds                                  1,798,630        777,353  
   Furniture and fixtures                              176,897        163,116  
   Leasehold improvements                               80,447         73,854  
   Capitalized Interest                           _____106,228    __________-  
						     4,059,376      2,442,324  
   Less - accumulated depreciation                  (1,462,338)    (1,048,638)
						  ____________    ___________  
						     2,597,038      1,393,686  
						  ____________    ___________  
OTHER ASSETS                                           310,981        307,105  
						  ____________    ___________  
						  $  7,088,031    $ 7,518,616  
						  ============    ===========  
	 LIABILITIES AND SHAREHOLDERS' EQUITY  
CURRENT LIABILITIES:  
   Accounts payable                               $    659,973    $   550,174  
   Accrued payroll                                     213,130        158,225  
   Other accrued liabilities                           199,384        216,924  
   Deferred revenue                                    250,000        566,000  
						  ____________    ___________  
	Total current liabilities                    1,322,487      1,491,323  
						  ____________    ___________  
COMMITMENTS (Note 5)                                         -              -
  
SHAREHOLDERS' EQUITY:  
   Preferred stock, no par, 10,000,000 shares  
     authorized; no shares issued and outstanding            -              -  
   Common stock, no par, 100,000,000 shares  
     authorized; issued and outstanding 19,540,413  
     and 15,585,232 shares at March 31, 1997 and  
     1996, respectively                             40,035,736     36,001,158  
   Accumulated deficit                             (34,270,192)   (29,973,865)  
						  ____________    ___________  
     Total shareholders' equity                      5,765,544      6,027,293  
						  ____________    ___________  
						  $  7,088,031    $ 7,518,616  
						  ============    ===========  
  
		  The accompanying notes are an integral part  
		  of these consolidated financial statements.  
  
 
   
  
	       BIOJECT MEDICAL TECHNOLOGIES INC. AND SUBSIDIARIES  
		     CONSOLIDATED STATEMENTS OF OPERATIONS  
  
  
					   For the Year Ended March 31,  
				       1997           1996         1995  
				       _______________________________________  
                                                            
REVENUES:  
  
  Net sales of products             $ 1,269,882    $ 3,059,018    $1,479,948                
  Licensing/technology fees             965,500      1,150,000     1,444,000                
				      ___________    __________    __________  
				      2,235,382      4,209,018     2,923,948                
				      ___________    __________    __________  
 
EXPENSES:  
  
   Manufacturing                       2,184,050      5,195,914     3,394,089                
   Research and development            1,275,580      1,486,607     1,427,861                
   Selling, general and administrative 3,177,228      3,168,618     4,186,549                
  Other (income) expense               (105,149)      (211,049)     (428,402)                
				      ___________   ___________    __________  
				       6,531,709      9,640,090     8,580,097                
				      ___________   ___________    __________  
  
LOSS BEFORE TAXES                    (4,296,327)    (5,431,072)   (5,656,149)                
  
PROVISION FOR INCOME TAXES                     -              -             -                
				      ___________   ___________   ___________  
  
NET LOSS                            $(4,296,327)   $(5,431,072)  $(5,656,149)                
				      ===========   ===========   ===========  
  
NET LOSS PER SHARE                  $     (0.26)   $     (0.39)  $     (0.43)                
				      ============  ===========   ===========  
  
SHARES USED IN PER SHARE CALCULATION   16,705,274     14,074,349   
13,167,301                
				      ============  ===========   ===========  
  
		      The accompanying notes are an integral part  
		      of these consolidated financial statements  
  
   
  
	      BIOJECT MEDICAL TECHNOLOGIES INC. AND SUBSIDIARIES  
		CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY  
  
  
					      COMMON STOCK  
					________________________  Accumulated  
					Shares       Amount       Deficit       Total  
				       __________   ___________  ____________  ___________  
                                                                      
  
BALANCES, MARCH 31, 1994                13,158,074   $32,263,783  $(18,886,644) 
$13,377,139  
  
  Issuance of common stock in  
    exchange for services                  101,000       243,312             -      243,312  
  
  Net loss                                     -             -    (5,656,149)  (5,656,149)  
				       __________    __________  ____________  ___________  
  
BALANCES, MARCH 31, 1995              13,259,074    32,507,095   (24,542,793)   
7,964,302  
  
  Issuance of common stock in  
    exchange for services                   23,149        39,962             -       39,962  
  
  Issuance of common stock under  
    a private placement in     
    November and December 1995           2,303,009     3,454,101             -    3,454,101  
  
  Net loss                                       -             -    (5,431,072)  (5,431,072)  
					__________   ___________  ____________  ___________  
  
BALANCES, MARCH 31, 1996                15,585,232     36,001,158  (29,973,865)    
6,027,293  
			       
  Issuance of common stock in                                   
    exchange for services                   33,298        159,350            -       159,350
  
  Issuance of common stock under         
    a private placement in     
    December 1996                        3,434,493      2,163,000            -     2,163,000
  
  Issuance of stock to Schering AG         
    in exchange for debt                   487,390      1,712,228            -     1,712,228

  Net loss                                       -              -  (4,296,327)    (4,296,327)   
					__________   ___________  _____________  ___________  
  
BALANCES, MARCH 31, 1997                19,540,413    $40,035,736  $(34,270,192) 
$5,765,544 
				=========  ========= ==========  ========     
  
  
		      The accompanying notes are an integral part  
		      of these consolidated financial statements.  
   
  
	       BIOJECT MEDICAL TECHNOLOGIES INC. AND SUBSIDIARIES  
		      CONSOLIDATED STATEMENTS OF CASH FLOWS  
  
  
  
						    For the Year Ended March 31,  
					      1997             1996             1995  
					      ____________________________________________  
                                                                         
CASH FLOWS FROM  
   OPERATING ACTIVITIES:  
   Net loss                               $(4,296,327)         $(5,431,072)    $(5,656,149)                
   Adjustments to net loss:  
      Depreciation and amortization           443,700              520,714         247,183          
      Contributed capital for services        159,350               39,962         243,312                  
   Net changes in assets  
    and liabilities:  
       Accounts receivable                    113,003              305,864        (561,616)         
       Inventories                           (450,511)            (147,237)       (144,982)                  
       Other current assets                       492                6,435          (6,773)          
       Accounts payable                       109,799             (257,704)        593,498                   
       Accrued payroll                         54,905              (92,512)         52,436           
       Other accrued liabilities              (17,540)            (102,080)        273,305                   
       Deferred revenue                      (316,000)             410,000         156,000           
					    __________          ___________     ___________  
Net Cash Used in Operating Activities      (4,199,129)          (4,747,630)     (4,803,786)                   
					    __________          ___________     ___________  
  
CASH FLOWS FROM INVESTING ACTIVITIES:  
   Securities purchased                             -           (1,977,856)     (6,951,390)        
   Securities sold                            993,056            4,974,268       9,795,130                   
   Property and equipment                  (1,617,052)            (597,100)       (956,487)          
   Other assets                               (33,876)             (64,916)        (65,723)                   
					    __________          ___________     ___________  
Net Cash Provided By (Used In)  
   Investing Activities                      (657,872)           2,334,396       1,821,530         
					    __________          ___________     ___________  
  
CASH FLOWS FROM FINANCING ACTIVITIES:   
   Cash proceeds from common stock          2,163,000            3,454,101               -                   
   Borrowing from long-term debt                                             
   subsequently converted to common stock   1,712,228                    -               -
					    __________          ___________     ___________  
   Net Cash Provided by Financing  
    Activities                              3,875,228            3,454,101               -         
					    __________         ___________      ___________  
  
CASH AND CASH EQUIVALENTS:  
   Net increase (decrease) in cash  
     and cash equivalents                    (981,773)           1,040,867      (2,982,256)                  
   Cash and cash equivalents at   
     beginning of year                      3,098,251            2,057,384       5,039,640          
					    __________         ___________      ___________  
  
   Cash and cash equivalents at  
     end of year                           $2,116,478           $3,098,251      $2,057,384                   
					    ==========         ===========      ===========  
  
		  The accompanying notes are an integral part  
		  of these consolidated financial statements.  
  
  
   
	       BIOJECT MEDICAL TECHNOLOGIES INC. AND SUBSIDIARIES  
		   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  
  
1.     THE COMPANY:  
  
The consolidated financial statements of Bioject Medical Technologies Inc.   
and its subsidiaries (the "Company"), include the accounts of Bioject   
Medical Technologies Inc. ("BMT") and its wholly owned subsidiary, 
Bioject Inc. ("BI"). All significant intercompany transactions have been 
eliminated. BMT was incorporated on December 17, 1992 under the laws of the 
State of Oregon for the purpose of acquiring all of the outstanding common 
shares of Bioject Medical Systems, Ltd. ("BMSL") in exchange for an   
equivalent number of common shares of BMT stock under a plan of U.S.   
reincorporation approved by the Company's shareholders on November 20, 1992.   
BMSL was incorporated on February 14, 1985, under the laws of British   
Columbia, and terminated in July 1996. BI was incorporated on February 8, 
1985, under the laws of the State of Oregon.  
  
The Company commenced operations in 1985 for the purpose of developing,   
manufacturing and distributing a new drug delivery system. Since its   
formation, the Company has been engaged principally in organizational,   
financing, research and development, and marketing activities. In the last   
quarter of fiscal 1993, the Company launched U.S. distribution of its  
Biojector 2000 system primarily to the hospital and large clinic market.  
  
The Company's products and manufacturing operations are subject to extensive   
government regulation, both in the U.S. and abroad. In the U.S., the   
development, manufacture, marketing and promotion of medical devices is   
regulated by the Food and Drug Administration ("FDA") under the Federal   
Food, Drug, and Cosmetic Act ("FFDCA"). In 1987, the Company received   
clearance from the FDA under Section 510(k) of the FFDCA to market a hand-  
held CO2-powered jet injection system. In June 1994, the Company received  
clearance from the FDA under 510(k) to market a version of its Biojector   
2000 system in a configuration targeted at high volume injection   
applications.  In March 1997, the Company received a 510(k) clearance from 
the FDA to market a version of its Biojector 2000 with certain additional 
features.
  
Since its inception the Company has incurred operating losses and at March 31, 
1997 has an accumulated deficit of approximately $34.3 million.  The Company's 
revenues to date have been derived primarily from licensing and technology 
fees and more recently from sales of the Biojector 2000 system and Biojector 
syringes to public health clinics and flu immunization programs.  Future 
revenues will depend upon acceptance and use by healthcare providers of the 
Company's jet injection technology. Uncertainties over government regulation 
and competition in the healthcare industry may impact healthcare provider 
expenditures and third party payer reimbursements and, accordingly, the 
Company cannot predict what impact, if any, subsequent healthcare reforms 
might have on its business.  The Company's ability to achieve and sustain 
profitability will depend in part upon the customer acceptance of the 
Biojector 2000 system, sustained product performance, implementing additional 
product cost reductions and attaining revenues sufficient to support 
profitable operations.

The Company's revenues to date have not been sufficient to cover operating 
expenses.  However, the Company believes that if its products achieve market 
acceptance and the volume of sales increase, and its product costs are reduced, 
its cost of goods as a percentage of sales will decrease and eventually the 
Company will generate net income.  The level of sales required to generate 
net income will be affected by a number of factors including the pricing of 
the Company's products, its ability to attain efficiencies that  can 
be attained through volume and automated manufacturing, and the impact of 
inflation on the Company's manufacturing and other operating costs.  There 
can be no assurance that the Company will be able to successfully implement its 
manufacturing cost reduction program or sell its products at prices or in 
volumes sufficient to achieve profitability or offset increase in its costs 
should they occur.

The Company believes that its current cash position and cash received from a 
private placement of common stock and warrants on June 1997 (see note 7), 
combined with revenues and other cash receipts will not be adequate to fund 
the Company's operations through the end of fiscal 1998. The Company has 
identified a number of potential financing sources and is pursuing them 
aggressively. Even if the Company is successful in raising additional financing 
unforeseen costs and expenses or lower than anticipated cash receipts from 
product sales or research and development activities could accelerate or 
increase the financing requirements. The Company has been successful in 
raising additional financing in the past and believes that sufficient funds 
will be available to fund future operations. However, there can be no assurance 
that the Company's efforts will be successful, and there can be no assurance 
that such financing will be available on terms which are not significantly 
dilutive to existing shareholders. Failure to obtain needed additional capital 
on terms acceptable to the Company, or at all, would significantly restrict the 
Company's operations and ability to continue product development and growth 
and materially adversely affect the Company's business.

The financial statements do not include any adjustments relating to the 
recoverability and classification of asset carrying amounts that might result 
should the Company be unable to continue as a going concern.
  
2.     ACCOUNTING POLICIES:  
  
CASH EQUIVALENTS  
The Company considers cash equivalents to consist of short-term, highly   
liquid investments with an original maturity of less than three months.  
  
SECURITIES AVAILABLE FOR SALE  
The Company accounts for its investments in marketable securities in 
accordance with Financial Accounting Standards Board Statement No. 115, 
Accounting for Certain Investments in Debt and Equity Securities (SFAS 115). 
Under provisions of SFAS 115, the Company is required to classify and account 
for its security investments as trading securities, securities available 
for sale or securities held to maturity depending on the Company's intent to 
hold or trade the securities at time of purchase. As of March 31, 1997 and 
1996, all securities held by the Company consisting entirely of short-term 
debt instruments were available for sale and, accordingly, are stated on the 
balance sheet at their fair market values which approximate cost. Realized 
gains or losses are determined on the specific identification method and are 
reflected in the accompanying financial statements. There were no significant 
realized gains or losses for fiscal 1997, 1996 and 1995.  
  
INVENTORIES  
Inventories are stated at the lower of cost or market. Cost is determined in   
a manner which approximates the first-in, first out (FIFO) method. Costs   
utilized for inventory valuation purposes include labor, materials and   
manufacturing overhead. Net inventories consist of the following:  
  
  
					       March 31,  
				     1997                  1996  
				     __________            __________  
                                                       
	 Raw Materials               $  815,868            $  697,694  
	 Work in Process                  9,763                12,467  
	 Finished Goods                 880,825               545,784  
				     __________            __________  
				     $1,706,456            $1,255,945  
				     ==========            ==========  
  
  
PROPERTY AND EQUIPMENT  
For financial statement purposes, depreciation expense on property and   
equipment is computed on the straight-line method using the following lives:  
  
	  Furniture and Fixtures............................5 years  
	  Machinery and Equipment...........................7 years  
	  Computer Equipment................................3 years  
	  Production Molds..................................5 years  
  
Leasehold improvements are amortized on the straight-line method over the    
shorter of the remaining terms of the lease or the estimated useful lives of   
the assets.  
  
OTHER ASSETS  
Other assets include costs incurred for the application of patents, net of   
amortization on a straight-line basis over 17 years. Accumulated   
amortization totalled $144,713 and $114,713 at March 31, 1997 and 1996,   
respectively. Amortization expense for the years ended March 31, 1997, 1996   
and 1995 totalled $30,000, $20,000 and $31,000 respectively.  
  
ACCOUNTING FOR LONG-LIVED ASSETS  
In March 1995, the Financial Accounting Standards Board issued Statement No.   
121, "Accounting for the Impairment of Long-Lived Assets and for Long-Lived   
Assets To Be Disposed Of"(SFAS 121), which requires the Company to review   
for impairment of its long-lived assets and certain identifiable intangibles   
whenever events or changes in circumstances indicate that the carrying   
amount of an asset might not be recoverable. In certain situations, an  
impairment loss would be recognized. SFAS 121 became effective for the   
Company's year ended March 31, 1997.  The Company has studied the   
implications of SFAS 121 and, based on its evaluation, does not believe
that an adjustment to the carrying value of its long-lived assets is 
necessary.  

REVENUE RECOGNITION FOR PRODUCT SALES  
The Company records revenue from sales of its products upon shipment. In   
fiscal 1997, 1996 and 1995, sales to one customer accounted for 17%, 75% and
74% of net sales of products, respectively. At March 31, 1997, 62% of accounts 
receivable were accounted for by one customer.  
  
RESEARCH AND DEVELOPMENT AND LICENSING/TECHNOLOGY REVENUES  
Licensing fees are recognized as revenue when due and payable. Product   
development revenue is deferred upon receipt and is recognized as revenue as   
qualifying expenditures are incurred. Expenditures for research and   
development are charged to expense as incurred.  
  
In March 1994, the Company entered into a joint development agreement with   
Schering AG, a major pharmaceutical manufacturer, for the development of an   
application specific self injection system. Under terms of the agreement, 
the Company received a $500,000 licensing fee in April 1994 and has received 
partial funding of product development expenses on an agreed schedule. In 
fiscal 1995, the Company received a total of $1.1 million from the 
pharmaceutical company, composed of $500,000 in licensing fees which were 
recognized as revenue during fiscal 1995 and $600,000 of Phase I product 
development revenues, $444,000 of which were recognized as revenue in fiscal 
1995. In fiscal 1996, the Company received an additional $660,000 and a total 
of $751,000 was recognized as revenue. In fiscal 1997, the Company received 
a final product development payments totalling $349,500 and recognized revenue 
of $414,500.  During fiscal 1997, the Company entered into a supply agreement 
with Schering AG and commenced activities related to full production of the 
self injector.  Schering loaned the Company a total of $1.6 million to purchase 
molds and tooling for production of the product. In January 1997, the Company 
received notice that its contract with Schering AG would be cancelled.  Under 
provisions of the contract, Schering AG had the option of canceling the 
agreement if the FDA required extensive clinical studies beyond an 
originally planned safety study.  Schering AG received a review letter from 
the FDA which would have required Schering to conduct additional material 
clinical studies in order to use non-traditional delivery mechanisms with its 
Betaseron(R) product. Under terms of the contract, Schering was required to 
convert its $1.6 million note due from Bioject into approximately 460,000 
shares of Bioject common stock at a conversion price of $3.50 per share. 
In addition, $106,000 of accrued interest was converted into approximately 
27,000 shares of Bioject common stock at a conversion price of $3.50 per 
share. Schering is obligated to pay Bioject for the cost of product ordered 
through the date of cancellation of the contract.  
  
In January 1995, the Company entered into a joint development agreement with   
Hoffmann-La Roche, a major pharmaceutical manufacturer, for the development   
of application specific products. The Company received a licensing fee   
totalling $500,000 which was recognized as revenue in fiscal 1995. The   
Company is also receiving specified product development fees on an agreed   
upon schedule. In fiscal 1996, the Company received $900,000, of which  
$399,000 was recognized as revenue.  In fiscal 1997, the Company received 
$250,000 in product development fees and recognized revenue of $501,000.

INCOME TAXES  
The Company accounts for income taxes in accordance with Statement of   
Financial Accounting Standards No. 109, Accounting For Income Taxes (SFAS   
109). Under the liability method specified by SFAS 109, the deferred tax   
assets and liabilities are determined based on the temporary differences   
between the financial statement and tax bases of assets and liabilities as  
measured by the enacted tax rates for the years in which the taxes are   
expected to be paid. At March 31, 1997, the Company had total deferred tax   
assets of approximately $13.0 million, consisting principally of available 
net operating loss carryforwards. No benefit for these operating losses has 
been reflected in the accompanying financial statements as they do not 
satisfy the recognition criteria set forth in SFAS 109. Total deferred tax    
liabilities were insignificant as of March 31, 1997.  
  
As of March 31, 1997, BMT has net operating loss carryforwards of   
approximately $799,000 available to reduce future federal taxable income,   
which expire in 2008 through 2012. BI has net operating loss carryforwards of   
approximately $34 million available to reduce future federal taxable income,   
which expire in 2001 through 2012. Approximately $3.0 million of BI's   
carryforwards were generated as a result of deductions related to exercises   
of stock options. When utilized, this portion of BI's carryforwards, as tax  
effected, will be accounted for as a direct increase to contributed capital   
rather than as a reduction of that year's provision for income taxes. 
The principal differences between net operating loss carryforwards for 
tax purposes and the accumulated deficit result from capitalization of 
certain start-up costs and deductions related to the exercise of stock options 
for income tax purposes.  
  
USE OF ESTIMATES  
The preparation of financial statements in conformity with generally   
accepted accounting principles requires management to make estimates and   
assumptions that affect the reported amounts of assets and liabilities 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.  
  
NET LOSS PER SHARE  
Net loss per share is computed based on the weighted average number of   
common shares outstanding during the period. The effects of common stock   
equivalents have not been included in the calculation as they would be anti-  
dilutive.

3.     401(K) RETIREMENT BENEFIT PLAN:  
  
The Company has a 401(k) Retirement Benefit Plan for its employees. All   
employees subject to certain age and length of service requirements are   
eligible to participate. The plan permits certain voluntary employee   
contributions to be excluded from the employees' current taxable income   
under provisions of the Internal Revenue Code Section 401(k) and regulations  
thereunder. Effective January 1, 1996, the Company amended the plan to   
provide for voluntary employer matches of employee contributions up to 6% of   
salary and for discretionary profit sharing contributions to all employees.   
Such employer matches and contributions may be in either cash or Company   
common stock. For calendar 1996, the Company agreed to match 25% of   
employee contributions up to 6% of salary with Company stock. For calendar 
1997, the Company has agreed to match 37.5% of employee contributions up to 
6% of salary with Company stock.  In fiscal 1997 and 1996, the Company 
recorded an expense of $25,000 and $4,800, respectively, related to voluntary 
employer matches under the 401(k) Plan. The Board of Directors has reserved 
up to 100,000 shares of  common stock for these voluntary employer matches of 
which 31,630 shares have been committed through March 31, 1997.  
  
4.     SHAREHOLDERS' EQUITY:  
  
PREFERRED STOCK  
The Company has authorized 10 million shares of preferred stock, without par   
value, to be issued from time to time with such designations and preferences   
and other special rights and qualifications, limitations and restrictions   
thereon, as permitted by law and as fixed from time to time by resolution of  
the Board of Directors.  As of March 31, 1997, no preferred shares had been 
issued by the Company.
  
COMMON STOCK  
Holders of common stock are entitled to one vote for each share held of   
record on all matters to be voted on by shareholders. No shares have been   
issued subject to assessment, and there are no preemptive or conversion   
rights and no provision for redemption, purchase or cancellation, surrender   
or sinking or purchase funds. Holders of common stock are not entitled to   
cumulate their shares in the election of directors.  A total of 100,000 shares 
of common stock have been reserved by the Board of Directors for issuance to 
401(k) plan participants (see note 3) of which 31,630 shares have been issued 
through March 31, 1997.
  
ESCROWED SHARES  
As a result of the Company's initial public offering on the Vancouver Stock   
Exchange, 1.5 million shares of the Company had been held in escrow pursuant 
to an Escrow Agreement dated May 30, 1986, among the Company, WAM Partnership   
and the escrow agent, Montreal Trust Company. WAM Partnership was owned by   
Carl E. Wilcox, former Chairman and C.E.O., and J. Thomas Morrow, former  
Director, and managed by Mr. Wilcox. Both Mr. Wilcox and Mr. Morrow are   
founders of the Company. The Escrow Agreement provided that these escrowed   
shares would be released from escrow based on a cash flow formula or, 
alternatively, the shares could be released by making application and 
obtaining consent of the Superintendent of Brokers of British Columbia based 
on demonstrating company value.  Under the escrow agreement, any shares not 
released by July 14, 1996 would be cancelled.
  
In connection with Mr. Wilcox's resignation as chairman and chief executive 
officer of the Company (see Note 6), the Board of Directors granted Mr. Wilcox 
a special power of attorney to exclusively perform all acts necessary to obtain 
extension of the escrow and/or release of the WAM Partnership escrow shares. 

On June 3, 1996, the British Columbia Securities Commission informed the   
Company that its Executive Director (formerly the Superintendent of Brokers)   
consented to the release of all shares originally held in escrow.  This   
means that the 1.5 million shares of common stock which had been held under   
this escrow arrangement are now held by the owners of the shares without   
risk of cancellation and may be sold.  Upon release, approximately 150,000   
of these shares were considered to have been contributed back to the Company   
and reissued to certain former employees in consideration for past services   
rendered on behalf of the Company. The Company recorded the shares as   
contributed capital with a corresponding non-cash charge to compensation  
expense at the fair market value of the stock on the date of issuance.    
Accordingly, a non-cash charge of $120,000 was recorded in the financial   
statements in the first quarter of fiscal 1997.  
  
STOCK OPTIONS  
Options may be granted to directors, officers and employees of the Company   
by the Board of Directors under terms of the Bioject Medical Technologies   
Inc. 1992 Stock Incentive Plan (the "Plan"), which was approved by the   
Company's shareholders on November 20, 1992 and adopted by the Board   
effective December 17, 1992. Under the terms of the Plan, eligible employees   
may receive statutory and nonstatutory stock options, stock bonuses and   
stock appreciation rights for purchase of shares of the Company's common   
stock at prices and vesting as determined by a committee of the Board.   
Except for options whose terms were extended, options granted under a prior   
plan maintain their previous option price, vesting and expiration dates. As   
amended in fiscal 1995, a total of up to 3,000,000 shares of the Company's   
common stock including options outstanding at the date of initial   
shareholder approval of the Plan may be granted under the Plan. Options 
outstanding at March 31, 1997 expire through March 31, 2005.  
  
In October 1995, the Financial Accounting Standards Board issued Statement   
No. 123, Accounting for Stock-Based Compensation (SFAS 123), which   
establishes a fair value-based method of accounting for stock-based   
compensation plans and requires additional disclosures for those companies   
that elect not to adopt the new method of accounting. The Company has elected 
to continue to account for stock options under APB Opinion No. 25, Accounting   
for Stock Issued to Employees. However, as prescribed by SFAS 123 the Company 
has computed, for pro forma disclosure purposes, the value of all options 
granted during fiscal year 1997 and 1996 using the Black-Scholes option-pricing 
model, using the following weighted average assumptions for grants in 1997 and 
1996:

	 Risk-free interest rate            6%
	 Expected dividend yield            0%
	 Expected life                      1.5 years
	 Expected volatility                47%

The total value of options granted during 1997 and 1996 would be amortized on 
a pro forma basis over the vesting period of the options.  Options generally 
vest equally over three years.  If the Company had accounted for these plans in 
accordance with SFAS 123, the Company's net loss and net loss per share would 
have increased as reflected in the following pro forma amounts 
(in thousands of $):

				 Year ended March 31,                
				    1997    1996
				   ______   ______
Net loss:
  As reported                     $(4,296) $(5,431)
  Pro forma                        (4,480)  (5,541) 
Net loss per share:
  As reported                       (0.26)  (0.39)
  Pro forma                         (0.27)  (0.39)
 
The above determination of proforma expense has been calculated consistent 
with SFAS 123 which does not take into consideration limitations on 
exercisability and transferability imposed by the Company's Stock Incentive 
Plan.  Further, the valuation model is heavily weighted to stock price 
volatility, even with a declining stock price, which tends to increase 
calculated value.  The actual value, if any, and, therefore, imputed 
proforma expense will vary based on the exercise date and the market price 
of  the related common stock when sold.

Stock option activity is summarized as follows:  
  
  
						   Exercise  
				      Shares       Price          Amount  
				     _________     ____________   __________  
                                                           
Balances March 31, 1994              1,068,625     $3.20 - 5.00   $4,424,252  
Options granted                      1,427,250      2.60 - 4.75    5,387,632  
Options exercised                            -                -            -  
Options canceled or expired           (952,225)     3.00 - 5.00   (3,904,917)  
				     _________     ____________  ___________  
Balances March 31, 1995              1,543,650      2.60 - 5.00    5,906,967  
Options granted                      1,316,439      1.25 - 4.50    3,129,177  
Options exercised                            -                -            -  
Options canceled or expired         (1,161,150)     2.34 - 5.00   (4,302,332)  
				    __________     ____________  ___________  
Balances March 31, 1996              1,698,939      1.25 - 4.50    4,733,812  
Options granted                        705,525      1.00 - 1.30      830,006                                      
Options exercised                            -                                      
Options canceled or expired           (472,906)     1.00 - 4.00     (809,880)               
				    __________     ____________  ___________  
Balances March 31, 1997              1,931,558     $1.00 - 4.50   $4,753,938   
				    ==========     ============  ===========  

  
  
The following table sets forth as of March 31, 1997 the number of shares 
outstanding, exercise price, weighted average remaining contractual life, 
weighted average exercise price, number of exercisable shares and weighted 
average exercise price of exercisable options by groups of similar price and 
grant date:



		OPTIONS OUTSTANDING                      OPTIONS EXERCISABLE

Exercise   Outstanding   Weighted Average   Weighted  Exercisable   Weighted
Price      shares        Remaining          Average   Options       Average  
	   at 3/31/97    Contractual        Exercise                Exercise   
	   Life(Years)   Price              Price     
- - ------    -----------    -----------        --------  ----------    --------
                                                     

$1.00- 1.25   690,125       4.37           $1.17       476,688        $1.23 
1.26 - 2.50   338,933       5.01            1.57       181,999         1.75
2.51 - 3.75   380,000       6.60            3.07       305,000         2.97 
3.76 - 4.88   522,500       4.29            4.08       322,500         4.16



As of March 31, 1997, current officers and employees of the Company held 
approximately 1.0 million stock options, under the original terms of their 
issuance included above. Subsequent to year end, the Stock Option Committee of 
the Board of Directors approved a plan whereby employees may elect to reprice 
their outstanding options to an exercise price of $.75 per share subject to 
a 25% reduction in outstanding option shares and a deferral of exercisability 
until April 3, 1998.           
			

WARRANTS  
Warrant activity is summarized as follows:  
  
  
						 Exercise  
				    Shares       Price         Amount  
				    _________    ____________  __________  
                                                        
Balances March 31, 1994                60,000     $      4.50   $ 270,000  
Warrants exercised                          -               -           -  
Warrants canceled or expired          (60,000)           4.50    (270,000)  
				    _________    ____________  __________  
Balances March 31, 1995                     -               -           -  
Warrants issued expiring Nov. 2000  1,864,343     1.97 - 2.00   3,724,401  
Warrants issued expiring Feb. 1998    575,752            2.00   1,151,505
Warrants exercised                          -               -           -  
Warrants canceled or expired                -               -           -  
				    _________    ____________  __________  
Balances March 31, 1996             2,440,095     1.97 - 2.00   4,875,906  
Warrants issued expiring Dec. 2001  3,590,490      .82 - 1.00   3,562,413  
Warrants exercised                          -               -           -                              
Warrants canceled or expired                -               -           - 
				    _________    ____________  __________  
Balances March 31, 1997             6,030,585    $ .82 - 2.00  $8,438,319  
				    ==========  ============  ==========  

  

5.     COMMITMENTS:  
  
BI has operating leases for its manufacturing, sales and administrative   
facilities and warehouse facilities with options to renew for an additional   
five-year term upon expiration. BI also leases office equipment under   
operating leases for periods up to five years. At March 31, 1997, future   
minimum payments under noncancellable operating leases with terms in 
excess of one year are as follows:  
  
  
  
Year Ending March 31,                    Facilities        Equipment  
					 __________        _________  
                                                       
       1998                              $212,000          $45,000  
       1999                               219,000           24,000  
       2000                               220,000            4,000
       2001                               235,000            3,000
       2002                               236,000                -
					  118,000                -
       Thereafter
                                                        
  
Lease expense for the years ended March 31, 1997, 1996 and 1995 totalled 
$283,000,$221,000, and $214,000, respectively.  
  
6.     RELATED PARTY TRANSACTIONS:  
  
On January 12, 1995, the Board of Directors announced the resignation of the   
Company's Chairman and Chief Executive Officer, Carl E. Wilcox. In   
consideration for Mr. Wilcox's long service to the Company, the Board   
granted Mr. Wilcox 100,000 shares of common stock valued at $241,000 and   
cash compensation totalling $247,000. The Board agreed to pay Mr. Wilcox 
$20,000 per year for two years under a covenant not-to-compete. The Board also 
vested 200,000 previously granted option shares at $4.00 per share and extended 
the expiration date to January 14, 1998. The Board granted Mr. Wilcox  
a special power of attorney to exclusively perform all acts necessary to   
obtain extension and/or release of the WAM Partnership escrow shares.  
In addition, the Board agreed to pay up to $10,000 of costs associated with 
such extension and/or release. On June 3, 1996, the British Columbia Securities 
Commission informed the Company that release of the escrow shares had been 
granted (see Note 4). The value of the severance agreement totalling $488,000 
was recorded as general and administrative expense in the accompanying 
financial statements in fiscal 1995.  
  
7.    SUBSEQUENT EVENT:

On June 18, 1997, the Company completed a private placement of units (one unit 
consisting of one share of common stock and one-half warrant for purchase of 
common stock at $.71 per share)for total proceeds of $750,000.  The Company 
has committed to register the $1.7 million shares and, if possible, the common 
shares underlying the 872,000 warrants issued in the private placement on a 
Form S-3 registration statement within 20 days of close of the transaction.



Item 9.    CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON  
	   ACCOUNTING AND FINANCIAL DISCLOSURE  
  
None.  

  
			    PART III  
  
     The Company has omitted from Part III the information that will appear   
in the Company's definitive proxy statement for its annual meeting of   
shareholders to be held on September 11, 1997 (the "Proxy Statement"), which   
will be filed within 120 days after the end of the Company's fiscal year   
pursuant to Regulation 14A.  
  
Item 10.   DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT  
  
     The information required by this Item is incorporated by reference to   
the information under the caption "DIRECTORS AND EXECUTIVE OFFICERS OF THE   
REGISTRANT" in the Proxy Statement.  
  
Item 11.    EXECUTIVE COMPENSATION  
  
     The information required by this Item is incorporated by reference to   
the information under the caption "EXECUTIVE COMPENSATION AND OTHER   
TRANSACTIONS" in the Proxy Statement.  
  
Item 12.    SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND 
MANAGEMENT  
  
The information required by this Item is incorporated by reference to the   
information under the caption "SECURITY OWNERSHIP OF CERTAIN BENEFICIAL   
OWNERS AND MANAGEMENT" in the Proxy Statement.  
  
Item 13.    CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS  
  
The information required by this Item is incorporated by reference to the   
information under the caption "CERTAIN RELATIONSHIPS AND RELATED   
TRANSACTIONS" in the Proxy Statement.  
  
				  PART IV  
  
Item 14.    EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND
REPORTS ON FORM 8-K  
  
(a)   The following documents are filed as a part of this report:  
  
      (1)   Consolidated Financial Statements and Report of  
	    Independent Public Accountants are included under  
	    Item 8, in Part II.  
  
      (2)   Consolidated Financial Statement Schedules and Report  
	    of Independent Public Accountants on those schedules:  

				None required  
  
  
      (3)   Exhibits:  The following exhibits are filed as part  
	    of this report.  An asterisk (*) beside the exhibit number  
	    indicates the subset of the exhibits containing each  
	    management contract, compensatory plan, or arrangement  
	    required to be identified separately in this report.  
  
  
  
  
Exhibit  
Number     Exhibit Description  
_______    
_________________________________________________________________  
          
 3.1       Articles of Incorporation of Bioject Medical Technologies Inc.  
	   incorporated by reference to the same exhibit number of the  
	   Company's Form 10-K for the year ended January 31, 1993.  
  
3.2        Amended and Restated By-laws of Bioject Medical Technologies Inc.  
	   Incorporated by reference to the same exhibit number of the  
	   Company's Form 10-Q for the quarter ended September 30, 1994.  
  
4.3*       Bioject Medical Technologies Inc. 1992 Stock Incentive Plan, as  
	   amended through July 25, 1996.
  
10.4       Lease Agreement dated March 21, 1989 between Spieker-Hosford-  
	   Eddy-Souther #174, Limited Partnership and Bioject Inc. for the  
	   Portland, Oregon facility incorporated by reference to the same  
	   exhibit number of Company's Form 10-K for the year ended January  
	   31, 1989.  
  
10.4.1     Amended Lease Agreement dated June 18, 1992 between Bridgeport  
	   Woods Investors (successors in interest to Spieker-Hosford-Eddy-  
	   Souther #174 Limited Partnership) and Bioject Inc. for the  
	   Portland, Oregon facility incorporated by reference to the same  
	   exhibit number of the Company's Form 10-K for the year ended  
	   January 31, 1993.  
  
10.4.2    Lease Agreement dated September 10, 1996 between Bridgeport Woods 
	  Business park and Bioject Inc. for the Portland, Oregon facility.  
	  Incorporated by reference to the same exhibit number of the Company's 
	  Form 10-Q for the period ended September 30, 1996.

10.5      Lease Extension Agreement dated October 4, 1994, between Earl J. Itel 
	  and Loris Itel Trust and Bioject, Inc., for the 6000 sq. ft. 
	  Tualatin, Oregon warehouse.   Incorporated by reference to the 
	  same exhibit number of the Company's Form 10-Q/A for the period ended 
	  December 31, 1996.

10.7*      Executive Employment Contract with Peggy J. Miller, dated  
	   January 18, 1993 incorporated by reference to the same exhibit  
	   number of the Company's Form 10-K for the year ended  
	   January 31, 1993.  
  
10.8*      Executive Employment Contract with J. Michael Redmond, dated  
	   February 8, 1996. Incorporated by reference to the same exhibit 
	   number of the Company's Form 10-K for the year ended March 31, 1996.
  
10.14      Common Stock Purchase Agreement between Eli Lilly and Company  
	   and Bioject Medical Systems Ltd. dated April 29, 1992  
	   incorporated by reference to the same exhibit number of Company's  
	   Form 8, dated May 28, 1992, amending Company's Form 10-K for the  
	   year ended January 31, 1992.  
  
10.17      Development and Licensing Agreement between Eli Lilly & Company  
	   and Bioject Inc., dated April 29, 1992 incorporated by reference  
	   to the same exhibit number of Company's Form 8, dated October 9,  
	   1992, amending Company's Form 10-Q for the quarter ended   
	   April 30, 1992. Confidential treatment has been granted with  
	   respect to certain portions of this exhibit pursuant to an   
	   Application for Confidential Treatment filed with the Commission   
	   under Rule 24b-2 under the Securities Exchange Act of 1934, as  
	   amended.  
  
10.17.1    Amendment to Development and Licensing Agreement between Eli   
	   Lilly and Company and Bioject Inc., effective May 5, 1993   
	   incorporated by reference to the same exhibit number of Company's   
	   Form S-1, No. 33-68846, dated November 1, 1993.  Confidential  
	   treatment has been granted with respect to certain portions of   
	   this exhibit pursuant to an Application for Confidential   
	   Treatment filed with the Commission under Rule 406 under the  
	   Securities Act of 1933, as amended. Confidential treatment has been 
	   granted with respect to certain portions of this exhibit pursuant 
	   to an Application for Confidential Treatment filed with the 
	   Commission under Rule 24b-2 under the Securities Exchange Act of 
	   1934, as amended.  

10.23      Development and Licensing Agreement between Schering, AG, Bioject  
	   Inc. and Bioject Medical Technologies Inc. dated March 28, 1994  
	   incorporated by reference to the same exhibit number of the  
	   Company's Form 10-K for the year ended March 31, 1994. Confidential 
	   treatment has been granted with respect to certain portions of this 
	   exhibit pursuant to an Application for Confidential Treatment filed 
	   with the Commission under Rule 24b-2 under the Securities exchange 
	   Act of 1934, as amended.
  
10.26      Heads of Agreement between Hoffmann-La Roche Inc. and Bioject   
	   Inc. dated January 10, 1995. Confidential treatment has been   
	   granted with respect to certain portions of this exhibit pursuant   
	   to an Application for Confidential Treatment filed with the   
	   Commission under Rule 24b-2 under the Securities Exchange Act of 
	   1934 as amended.  
  
10.27*     Employment Agreement with James C. O'Shea dated October 3, 1995  
	   incorporated by reference to the same exhibit number of the  
	   Company's Form 10-Q for the quarter ended September 30, 1995.  
  
10.28      Form of Amended and Restated Registration Rights Agreement   
	   between Bioject Medical Technologies Inc. and the participants in  
	   the 1995 private placement incorporated by reference to exhibit   
	   4.2 of the Company's Registration Statement on Form S-3   
	   (No. 33-80679).  
  
10.29      Form of Amended and Restated Series "A" Common Stock Purchase  
	   Warrant incorporated by reference to exhibit 4.3 of the Company's  
	   Registration Statement on Form S-3 (No. 33-80679).  
  
10.30      Form of Series "B" Common Stock Purchase Warrant incorporated by  
	   reference to exhibit 4.4. of the Company's Registration Statement  
	   on Form S-3 (No. 33-80679).  
  
10.31      Form of Amended and Restated Series "C" Common Stock Purchase  
	   Warrant incorporated by reference to exhibit 4.5 of the Company's  
	   Registration Statement on Form S-3 (No. 33-80679). Confidential 
	   treatment has been granted with respect to certain portions of 
	   this exhibit pursuant to an Application for Confidential Treatment 
	   filed with the Commission under Rule 24b-2 under the Securities 
	   Exchange Act of 1934, as amended.
  
10.32     Supply Agreement dated June 26, 1996 between Bioject Inc. and Schering
	  Aktiengesellschaft. Incorporated by reference to the same exhibit 
	  number of the Company's Form 8-K/A dated June 26, 1996. Confidential 
	  treatment has been granted with respect to certain portions of this 
	  exhibit pursuant to an Application for Confidential Treatment filed 
	  with the Commission under Rule 24b-2 under the Securities exchange Act 
	  of 1934, as amended.

10.32.1   Security Agreement dated June 26, 1996 between Bioject Inc. and 
	  Schering Aktiengesellschaft. Incorporated by reference to the same 
	  exhibit number of the Company's Form 10-Q for the period ended 
	  June 30, 1996.

10.33     Form of Series "D" Common Stock Purchase Warrant.  Incorporated by 
	  reference to exhibit 4.6 of the Company's form 8-K dated December 
	  11, 1996.

10.34     Form of Series "E" Common Stock Purchase Warrant.  Incorporated by 
	  reference to exhibit 4.7 of the Company's Form 8-K dated 
	  December 11, 1996.

10.35     Form of Registration Rights Agreement between Bioject Medical 
	  Technologies Inc. and the participants in the 1996 private 
	  placement.  Incorporated by reference to exhibit 4.8 of the Company's 
	  Form 8-K dated December 11, 1996.

10.36     Form of Series "F" Common Stock Purchase Warrant.

10.37     Form of Series "G" Common Stock Purchase Warrant.

10.38     Form of Registration Rights Agreement between Bioject Medical 
	  Technologies Inc. and the participants in the 1997 private 
	  placement.

21.1      List of Subsidiaries incorporated by reference to Exhibit No.   
	  22.1 of Company's Form 10-K for the year ended January 31, 1993.  
  
23.2      Consent of Independent Public Accountants  
  
27.1      Financial Data Schedule  
  
  
  
(b)    Forms 8K filed since last report:  
  
       Form 8-K January 14, 1997 reporting unaudited proforma results 
       of operations and financial position as of November 30,1996 
       reflecting results of the private placement completed in 
       December 1996.

       Form 8-K January 28, 1997 reporting cancellation of the 
       Schering contract.  
  
  

				    SIGNATURES  
  
Pursuant to the requirements of Section 13 or 15(d) of the  
Securities Exchange Act of 1934, Bioject Medical Technologies  
Inc. has duly caused this report to be signed on its behalf by  
the undersigned, thereunto duly authorized:  
  
				    BIOJECT MEDICAL TECHNOLOGIES INC.  
				    (Registrant)  
  
  
				    By: /S/ JAMES C. O'SHEA  
				    James C. O'Shea  
				    Chairman of the Board, President  
				    and Chief Executive Officer  
  
Pursuant to the request of the Securities Exchange Act of 1934,  
this report has been signed below on behalf of the Registrant and  
in the capacities indicated on the dates shown.  
  
SIGNATURE                              TITLE  
  
/S/ JAMES C. O'SHEA                    Chairman of the Board, President  
James C. O'Shea                        and Chief Executive  
Officer  
  
/S/ PEGGY J. MILLER                    Vice President, Chief Financial  
Peggy J. Miller                        Officer and Secretary/Treasurer  
  
/s/ DAVID H. DE WEESE                  Director
David H. de Weese 

/S/ GRACE K. FEY                       Director  
Grace K. Fey  

/S/ WILLIAM A. GOUVEIA                 Director  
William A. Gouveia  
  
/S/ ERIC T. HERFINDAL                  Director  
Eric T. Herfindal

/S/ RICHARD PLESTINA                   Director  
Richard Plestina

/S/ JOHN RUEDY, M.D.                   Director  
John Ruedy, M.D.  
  
 
  

		   
		  INDEX TO EXHIBITS  
  
  
  
Exhibit  
Number     Exhibit Description  
_______    __________________________________________________________  
          

4.3        Bioject Medical Technologies, Inc. 1992 Stock Incentive Plan, 
	   as amended through July 25, 1996.
  
10.36      Form of Series "F" Common Stock Purchase Warrant.

10.37      Form of Series "G" Common Stock Purchase Warrant.

10.38      Form of Registration Rights Agreement between Bioject Medical 
	   Technologies Inc. and the participants in the 1997 private 
	   placement.

23.2       Consent of Independent Public Accountants  
  
27.1       Financial Data Schedule  
  
  
 

						      
						     EXHIBIT 23.2   
								    
								 
								    
	    CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS   
				   
				   
As independent public accountants, we hereby consent to the incorporation   
of our report included in this Form 10-K into the Company's previously filed   
Registration Statements on Form S-3, File No. 33-80679 and File No. 333-18933,
and Registration Statements on Form S-8, File Nos. 33-94400, 33-56454 and 
33-42156.   
   
   
				       /S/ ARTHUR ANDERSEN LLP   
   
Portland, Oregon   
  June 27, 1997


[ARTICLE] 5  

EX-27.1

WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.

 

<LEGEND>  

						EXHIBIT  27.1  
   
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE   
CONSOLIDATED BALANCE SHEETS AND THE CONSOLIDATED STATEMENTS OF  
OPERATIONS FILED AS PART OF THE ANNUAL REPORT ON FORM 10-K AND IS 
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH ANNUAL REPORT ON FORM 10-K.   
   
<MULTIPLIER> 1   
	  
						 
<PERIOD-TYPE>                              YEAR   
<FISCAL-YEAR-END>                          MAR-31-1997   
<PERIOD-START>                             APR-01-1996   
<PERIOD-END>                               MAR-31-1997   
<CASH>                                       2,116,478   
<SECURITIES>                                         0   
<RECEIVABLES>                                  311,856   
<ALLOWANCES>                                    27,500   
<INVENTORY>                                  1,706,456   
<CURRENT-ASSETS>                             4,180,012   
<PP&E>                                       4,059,376   
<DEPRECIATION>                               1,462,338   
<TOTAL-ASSETS>                               7,088,031   
<CURRENT-LIABILITIES>                        1,322,487   
<BONDS>                                              0   
<PREFERRED-MANDATORY>                                0   
<PREFERRED>                                          0   
<COMMON>                                    40,035,376   
<OTHER-SE>                                           0   
<TOTAL-LIABILITY-AND-EQUITY>                 7,088,031   
<SALES>                                      1,269,882   
<TOTAL-REVENUES>                             2,235,382   
<CGS>                                        2,184,050   
<TOTAL-COSTS>                                2,184,050   
<OTHER-EXPENSES>                             4,347,659   
<LOSS-PROVISION>                                     0   
<INTEREST-EXPENSE>                                   0   
<INCOME-PRETAX>                            (4,296,327)   
<INCOME-TAX>                                         0   
<INCOME-CONTINUING>                        (4,296,327)   
<DISCONTINUED>                                       0   
<EXTRAORDINARY>                                      0   
<CHANGES>                                            0   
<NET-INCOME>                               (4,296,327) 
<EPS-PRIMARY>                                   (0.26)   
<EPS-DILUTED>                                   (0.26)  

					 

 

EX-10.36

							       Exhibit 10.36

THIS WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY APPLICABLE 
STATE LAWS, AND NO INTEREST THEREIN MAY BE SOLD, DISTRIBUTED, ASSIGNED, 
oFFERED, PLEDGED OR OTHERWISE TRANSFERRED UNLESS THERE IS AN EFFECTIVE 
REGISTRATION STATEMENT UNDER SUCH ACT AND APPLICABLE STATE SECURITIES 
LAWS COVERING ANY SUCH TRANSACTION OR SUCH TRANSACTION IS EXEMPT FROM 
THE REGISTRATION REQUIREMENTS OF SUCH ACT AND LAWS, SUCH COMPLIANCE, AT 
THE OPTION OF THE CORPORATION, TO BE EVIDENCED BY AN OPINION OF 
WARRANTHOLDER'S COUNSEL, IN FORM ACCEPTABLE TO THE CORPORATION, THAT NO 
VIOLATION OF SUCH REGISTRATION PROVISIONS WOULD RESULT FROM ANY PROPOSED 
TRANSFER OR ASSIGNMENT.


		  SERIES "F" COMMON STOCK PURCHASE WARRANT

		       Bioject Medical Technologies Inc.


THIS CERTIFIES that for good and valuable consideration received, _________, 
a(n) individual or registered assigns, is entitled, upon the terms and subject 
to the conditions hereinafter set forth, to acquire from Bioject Medical 
Technologies Inc., an Oregon corporation (the "Corporation") up to _______ 
fully paid and nonassessable shares of common stock, without par value, of the 
Corporation ("Warrant Stock") at a purchase price per share (the "Exercise 
Price") of $0.50.

1. Term of Warrant

Subject to the terms and conditions set forth herein, this Warrant shall be 
exercisable, in whole or from time to time part, at any time on or after the 
date hereof and at or prior to 11:59 p.m., Pacific Standard Time, on May 15, 
2002 (the "Expiration Time").  Notwithstanding the foregoing, at any time from 
the date of this Warrant, the Corporation shall have the right, except as may 
be limited by law, other agreements or herein, to call this Warrant for 
exercise, in whole or in part, by mailing written notice by United States mail 
to the registered holder hereof if the average closing bid price for the 
Corporation's common stock, as quoted by the Nasdaq National Market or any 
other established over-the-counter quotation service, is equal to or greater 
than $5.00 per share, as adjusted pursuant to Section 11 hereof, for any 
consecutive period of twenty trading days ending five business days prior to 
the date of notice of redemption.  In such event, this Warrant shall expire 
and cease to be exercisable at 11:59 p.m. Pacific Standard Time, of the  
thirtieth day after the date of mailing of the notice.

2. Exercise of Warrant

The purchase rights represented by this Warrant are exercisable by the 
registered holder hereof, in whole or in part, at any time and from time to 
time at or prior to the Expiration Time by the surrender of this Warrant and 
the Notice of Exercise form attached hereto duly executed to the office of the 
Corporation at 7620 S.W. Bridgeport Road, Portland, Oregon  97224 (or such 
other office or agency of the Corporation as it may designate by notice in 
writing to the registered holder hereof at the address of such holder 
appearing on the books of the Corporation), and upon payment of the Exercise 
Price for the shares thereby purchased (by cash or by check or bank draft 
payable to the order of the Corporation or by cancellation of indebtedness of 
the Corporation to the holder hereof, if any, at the time of exercise in an 
amount equal to the purchase price of the shares thereby purchased); whereupon 
the holder of this Warrant shall be entitled to receive from the Corporation a 
stock certificate in proper form representing the number of shares of Warrant 
Stock so purchased.

3. Issuance of Shares; No Fractional Shares of Scrip

Certificates for shares purchased hereunder shall be delivered to the holder 
hereof by the Corporation's transfer agent at the Corporation's expense within 
a reasonable time after the date on which this Warrant shall have been 
exercised in accordance with the terms hereof.  Each certificate so delivered 
shall be in such denominations as may be requested by the holder hereof and 
shall be registered in the name of such holder or, subject to applicable laws, 
other name as shall be requested by such holder.  If, upon exercise of this 
Warrant, fewer than all of the shares of Warrant Stock evidenced by this 
Warrant are purchased prior to the Expiration Time, one or more new warrants 
substantially in the form of, and on the terms in, this Warrant will be issued 
for the remaining number of shares of Warrant Stock not purchased upon 
exercise of this Warrant.  The Corporation hereby represents and warrants that 
all shares of Warrant Stock which may be issued upon the exercise of this 
Warrant will, upon such exercise, be duly and validly authorized and issued, 
fully paid and nonassessable and free from all taxes, liens and charges in 
respect of the issuance thereof (other than liens or charges created by or 
imposed upon the holder of the Warrant Stock).  The Corporation agrees that 
the shares so issued shall be and be deemed to be issued to such holder as the 
record owner of such shares as of the close of business on the date on which 
this Warrant shall have been surrendered for exercise in accordance with the 
terms hereof.  No fractional shares or scrip representing fractional shares 
shall be issued upon the exercise of this Warrant.  With respect to any 
fraction of a share called for upon the exercise of this Warrant, an amount 
equal to such fraction multiplied by the then current price at which each 
share may be purchased hereunder shall be paid in cash to the holder of this 
Warrant.

4. Charges, Taxes and Expenses

Issuance of certificates for shares of Warrant Stock upon the exercise of this 
Warrant shall be made without charge to the holder hereof for any issue or 
transfer tax or other incidental expense in respect of the issuance of such 
certificate, all of which taxes and expenses shall be paid by the Corporation, 
and such certificates shall be issued in the name of the holder of this 
Warrant or in such name or names as may be directed by the holder of this 
Warrant; provided, however, that in the event certificates for shares of 
Warrant Stock are to be issued in a name other than the name of the holder of 
this Warrant, this Warrant when surrendered for exercise shall be accompanied 
by the Assignment Form attached hereto duly executed by the holder hereof.

5. No Rights as Shareholders

This Warrant does not entitle the holder hereof to any voting rights or other 
rights as a shareholder of the Corporation prior to the exercise hereof.

6. Registration Rights

The Warrant Stock purchasable upon exercise of this Warrant has not been 
registered under the Securities Act of 1933 or any state securities law.  The 
Corporation shall have no obligation to register such Warrant Stock for resale 
unless the Offering as contemplated by the Agreement between , ("   "), and 
the Corporation dated May 15, 1997 is completed and only on the same terms as 
any registration rights for shares issuable upon exercise of warrants are 
included in such Offering.  The foregoing notwithstanding, any obligation 
undertaken by the Corporation to register the Warrant Stock shall be limited 
to the Corporation's use of its best efforts to do so, and in no event shall 
the Corporation be required to file or maintain the effectiveness of a 
registration statement on Form S-1 unless a Form S-1 is filed and maintained 
effective with respect to shares issuable upon exercise of warrants issued in 
such Offering.  

7. Exchange and Registry of Warrant

This Warrant is exchangeable, upon the surrender hereof by the registered 
holder at the above-mentioned office or agency of the Corporation, for a new 
Warrant of like tenor and dated as of such exchange.  The Corporation shall 
maintain at the above-mentioned office or agency a registry showing the name 
and address of the registered holder of this Warrant.  This Warrant may be 
surrendered for exchange, transfer or exercise, in accordance with its terms, 
at such office or agency of the Corporation, and the Corporation shall be 
entitled to rely in all respects, prior to written notice to the contrary, 
upon such registry.

8. Loss, Theft, Destruction or Mutilation of Warrant 

Upon receipt by the Corporation of evidence reasonably satisfactory to it of 
the loss, theft, destruction or mutilation of this Warrant, and in case of 
loss, theft or destruction of indemnity or security reasonably satisfactory to 
it, and upon reimbursement to the Corporation of all reasonable expenses 
incidental thereto, and upon surrender and cancellation of this Warrant, if 
mutilated, the Corporation will make and deliver a new Warrant of like tenor 
and dated as of such cancellation, in lieu of this Warrant.

9. Saturdays, Sundays and Holidays

If the last or appointed day for the taking of any action or the expiration of 
any right required or granted herein shall be a Saturday or a Sunday or shall 
be a legal holiday, then such action may be taken or such right may be 
exercised on the next succeeding day not a Saturday, Sunday or legal holiday.

10. Merger, Sale of Assets, Etc.

If at any time the Corporation proposes to merge or consolidate with or into 
any other corporation, effect any reorganization, or sell or convey all or 
substantially all of its assets to any other entity, then, as a condition of 
such reorganization, consolidation, merger, sale or conveyance, the 
Corporation or its successor, as the case may be, shall enter into a 
supplemental agreement to make lawful and adequate provision whereby the 
holder shall have the right to receive, upon exercise of the Warrant, the kind 
and amount of equity securities which would have been received upon such 
reorganization, consolidation, merger, sale or conveyance by a holder of a 
number of shares of common stock equal to the number of shares issuable upon 
exercise of the Warrant immediately prior to such reorganization, 
consolidation, merger, sale or conveyance.  If the property to be received 
upon such reorganization, consolidation, merger, sale or conveyance is not 
equity securities, the Corporation shall give the holder of this Warrant 
fifteen (15) business days prior written notice of the proposed effective date 
of such transaction, and if this Warrant has not been exercised by or on the 
effective date of such transaction, it shall terminate. 

11. Subdivision, Combination, Reclassification, Conversion, Etc. 

If the Corporation at any time shall, by subdivision, combination, 
reclassification of securities or otherwise, change the Warrant Stock into the 
same or a different number of securities of any class or classes, this Warrant 
shall thereafter entitle the holder to acquire such number and kind of 
securities as would have been issuable in respect of the Warrant Stock (or 
other securities which were subject to the purchase rights under this Warrant 
immediately prior to such subdivision, combination, reclassification or other 
change) as the result of such change if this Warrant had been exercised in 
full for cash immediately prior to such change.  The Exercise Price hereunder 
shall be adjusted if and to the extent necessary to reflect such change.  If 
the Warrant Stock or other securities issuable upon exercise hereof are 
subdivided or combined into a greater or smaller number of shares of such 
security, the number of shares issuable hereunder shall be proportionately 
increased or decreased, as the case may be, and the Exercise Price shall be 
proportionately reduced or increased, as the case may be, in both cases 
according to the ratio which the total number of shares of such security to be 
outstanding immediately after such even bears to the total number of shares of 
such security outstanding immediately prior to such event.  The Corporation 
shall give the holder prompt written notice of any change in the type of 
securities issuable hereunder, any adjustment of the Exercise Price for the 
securities issuable hereunder, and any increase or decrease in the number of 
shares issuable hereunder.

12. Transferability; Compliance with Securities Laws

(a) This Warrant may not be transferred or assigned in whole or in part 
without compliance with all applicable federal and state securities laws by 
the transferor and transferee (including the delivery of investment 
representation letters and legal opinions reasonably satisfactory to the 
Corporation, if requested by the Corporation).  Subject such restrictions, 
prior to the Expiration Time, this Warrant and all rights hereunder are 
transferable by the holder hereof, in whole or in part, at the office or 
agency of the Corporation referred to in Section 1 hereof.  Any such transfer 
shall be made in person or by the holder's duly authorized attorney, upon 
surrender of this Warrant together with the Assignment Form attached hereto 
properly endorsed.

(b) The Holder of this Warrant, by acceptance hereof, acknowledges that this 
Warrant and the Warrant Stock issuable upon exercise hereof are being acquired 
solely for the holder's own account and not as a nominee for any other party, 
and for investment, and that the holder will not offer, sell or otherwise 
dispose of this Warrant or any shares of Warrant Stock to be issued upon 
exercise hereof except under circumstances that will not result in a violation 
of the Securities Act of 1933, as amended, or any state securities laws.  Upon 
exercise of this Warrant, the holder shall, if requested by the Corporation, 
confirm in writing, in a form satisfactory to the Corporation, that the shares 
of Warrant Stock so purchased are being acquired solely for holder's own 
account and not as a nominee for any other party, for investment, and not with 
a view toward distribution or resale.

(c) Except as contemplated in the Registration Rights Agreement, the Warrant 
Stock has not been and will not be registered under the Securities Act of 
1933, as amended, and this Warrant may not be exercised except by (i) the 
original purchaser of this Warrant from the Corporation or (ii) an "accredited 
investor" as defined in Rule 501(a) under the Securities Act of 1933, as 
amended.  Each certificate representing the Warrant Stock or other securities 
issued in respect of the Warrant Stock upon any stock split, stock dividend, 
recapitalization, merger, consolidation or similar event, shall be stamped or 
otherwise imprinted with a legend substantially in the following form (in 
addition to any legend required under applicable securities laws):

THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED 
UNDER UNITED STATES FEDERAL OR STATE SECURITIES LAWS AND MAY 
NOT BE OFFERED FOR SALE, SOLD OR OTHERWISE TRANSFERRED OR 
ASSIGNED FOR VALUE, DIRECTLY OR INDIRECTLY, NOR MAY 
THE SECURITIES BE TRANSFERRED ON THE BOOKS OF THE CORPORATION, 
WITHOUT REGISTRATION OF SUCH SECURITIES UNDER ALL APPLICABLE UNITED 
STATES FEDERAL OR STATE SECURITIES LAWS OR COMPLIANCE WITH AN 
APPLICABLE EXEMPTION THEREFROM, SUCH COMPLIANCE, AT THE OPTION OF 
THE CORPORATION, TO BE EVIDENCED BY AN OPINION OF SHAREHOLDER'S 
COUNSEL, IN FORM ACCEPTABLE TO THE CORPORATION, THAT 
NO VIOLATION OF SUCH REGISTRATION PROVISIONS WOULD RESULT FROM 
ANY PROPOSED TRANSFER OR ASSIGNMENT.

13. Representations and Warranties

The Corporation hereby represents and warrants to the holder hereof that:

(a) during the period this Warrant is outstanding, the Corporation will 
reserve from its authorized and unissued common stock a sufficient number of 
shares to provide for the issuance of Warrant Stock upon the exercise of this 
Warrant;
 
b) the issuance of this Warrant shall constitute full authority to the 
Corporation's officers who are charged with the duty of executing stock 
certificates to execute and issue the necessary certificates for the shares of 
Warrant Stock issuable upon exercise of this Warrant;

(c) the Corporation has all requisite legal and corporate power to execute and 
deliver this Warrant, to sell and issue the Warrant Stock hereunder, to issue 
the common stock issuable upon exercise of the Warrant Stock and to carry out 
and perform its obligations under the terms of this Warrant; and

(d) all corporate action on the part of the Corporation, its directors and 
shareholders necessary for the authorization, execution, delivery and 
performance of this Warrant by the Corporation, the authorization, sale, 
issuance and delivery of the Warrant Stock, the grant of registration rights 
as provided herein and the performance of the Corporation's obligations 
hereunder has been taken;

(e) the Warrant Stock, when issued in compliance with the provisions of this 
Warrant and the Corporation's Articles of Incorporation (as they may be 
amended from time to time (the "Articles")), will be validly issued, fully 
paid and nonassessable, and free of all taxes, liens or encumbrances with 
respect to the issue thereof, and will be issued in compliance with all 
applicable federal and state securities laws; and

(f) the issuance of the Warrant Stock will not be subject to any preemptive 
rights, rights of first refusal or similar rights.

14. Corporation

The Corporation will not, by amendment of its Articles or through any 
reorganization, recapitalization, transfer of assets, consolidation, merger, 
dissolution, issue or sale of securities or any other action, avoid or seek to 
avoid the observance or performance of any of the terms to be observed or 
performed hereunder by the Corporation, but will at all times in good faith 
assist in the carrying out of all the provisions of this Warrant and in the 
taking of all such action as may be necessary or appropriate in order to 
protect the rights of the holder of the Warrant against impairment.

15. Governing Law

This Warrant shall be governed by and construed in accordance with the laws of 
the State of Oregon.


IN WITNESS WHEREOF, the Corporation has caused this Warrant to be executed by 
its duly authorized officers.

Dated:_____________, 1997
BIOJECT MEDICAL TECHNOLOGIES INC.


By:      
Name: Peggy J. Miller   
Title: Vice President, Chief Financial Officer & Secretary      

NOTICE OF EXERCISE

To: Bioject Medical Technologies Inc.

(1) The undersigned hereby elects to purchase _________ shares of common stock 
of Bioject Medical Technologies Inc. pursuant to the terms of the attached 
Warrant, and tenders herewith payment of the purchase price in full, together 
with all applicable transfer taxes, if any.   or

(2) In exercising this Warrant, the undersigned hereby confirms and 
acknowledges that the shares of common stock to be issued upon exercise hereof 
are being acquired solely for the account of the undersigned and not as a 
nominee for any other party, and for investment, and that the undersigned will 
not offer, sell or otherwise dispose of any such shares of common stock except 
under circumstances that will not result in a violation of the Securities Act 
of 1933, as amended, or any state securities laws.

(3) Please issue a certificate or certificates representing said shares of 
common stock in the name of the undersigned or in such other name as is 
specified below:


(Name)_______________________________________


(Address)______________________________________


(3) The undersigned represents that (a) he, she or it is the original 
purchaser from the Corporation of the attached Warrant or an "accredited 
investor" within the meaning of Rule 501(a) under the Securities Act of 1933, 
as amended and (b) the aforesaid shares of common stock are being acquired for 
the account of the undersigned for investment and not with a view to, or for 
resale in connection with, the distribution thereof and that the undersigned 
has no present intention of distributing or reselling such shares.


(Date)_________________             (Signature)________________________


			   ASSIGNMENT FORM

(To assign the foregoing Warrant, execute this form and supply required 
information.  Do not use this form to purchase shares.)


FOR VALUE RECEIVED, the undersigned registered owner of this Warrant hereby 
sells, assigns and transfers unto the Assignee named below all of the rights 
of the undersigned under the within Warrant, with respect to the number of 
shares of common stock of Bioject Medical Technologies Inc. set forth below:

Name of Assignee         Address          No. of Shares
_______________       ______________    _________________ 



and does hereby irrevocably constitute and appoint Attorney ____________ to 
make such transfer on the books of Bioject Medical Technologies Inc., 
maintained for the purpose, with full power of substitution in the premises.

The undersigned also represents that, by assignment hereof, the Assignee 
acknowledges that this Warrant and the shares of stock to be issued upon 
exercise hereof are being acquired for investment and that the Assignee will 
not offer, sell or otherwise dispose of this Warrant or any shares of stock to 
be issued upon exercise hereof except under circumstances which will not 
result in a violation of the Securities Act of 1933, as amended, or any state 
securities laws.  Further, the Assignee shall, if requested by the 
Corporation, confirm in writing, in a form satisfactory to the Corporation, 
that the shares of stock so purchased are being acquired for investment and 
not with a view toward distribution or resale.

Dated: ___________________________
Holder's Signature: _______________________

Holder's Address: ___________________________   
	

Guaranteed Signature:________________________

NOTE:  The signature to this Assignment Form must correspond with the name as 
it appears on the face of the Warrant, without alteration or enlargement or 
any change whatever, and must be guaranteed by a bank or trust company.  
Officers of corporations and those action in a fiduciary or other 
representative capacity should file proper evidence of authority to assign the 
foregoing Warrant.





 



 

 

EX-10.37

							   Exhibit 10.37    


THIS WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF HAVE NOT BEEN 
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY APPLICABLE 
STATE LAWS, AND NO INTEREST THEREIN MAY BE SOLD, DISTRIBUTED, ASSIGNED, 
OFFERED, PLEDGED OR OTHERWISE TRANSFERRED UNLESS THERE IS AN EFFECTIVE 
REGISTRATION STATEMENT UNDER SUCH ACT AND APPLICABLE STATE SECURITIES LAWS 
COVERING ANY SUCH TRANSACTION OR SUCH TRANSACTION IS EXEMPT FROM THE 
REGISTRATION REQUIREMENTS OF SUCH ACT AND LAWS, SUCH COMPLIANCE, AT THE 
OPTION OF THE CORPORATION, TO BE EVIDENCED BY AN OPINION OF WARRANTHOLDER'S 
COUNSEL, IN FORM ACCEPTABLE TO THE CORPORATION, THAT NO VIOLATION OF SUCH 
REGISTRATION PROVISIONS WOULD RESULT FROM ANY PROPOSED TRANSFER OR ASSIGNMENT.

  
		       SERIES "G" COMMON STOCK PURCHASE WARRANT

			  Bioject Medical Technologies Inc.


THIS CERTIFIES that for good and valuable consideration received, _________
a(n)______________or registered assigns, is entitled, upon the terms and 
subject to the conditions hereinafter set forth, to acquire from Bioject 
Medical Technologies Inc., an Oregon corporation (the "Corporation") up 
to __________fully paid and nonassessable shares of common stock, without 
par value, of the Corporation ("Warrant Stock") at a purchase price per 
share (the "Exercise Price") of $0.71.

1. Term of Warrant

Subject to the terms and conditions set forth herein, this Warrant shall be 
exercisable, in whole or from time to time part, at any time on or after the 
date hereof and at or prior to 11:59 p.m., Pacific Standard Time, on June 16, 
2002 (the "Expiration Time").  Notwithstanding the foregoing, at any time the 
Corporation shall have the right, except as may be limited by law, other 
agreements or herein, to call this Warrant for exercise, in whole or in part, 
by mailing written notice by United States mail to the registered holder 
hereof if the average closing bid price for the Corporation's common stock, as 
quoted by the Nasdaq National Market or any other established over-the-counter 
quotation service, is equal to or greater than $1.71 per share, as adjusted 
pursuant to Section 11 hereof, for any consecutive period of twenty trading 
days.  In such event, this Warrant shall expire and cease to be exercisable at 
11:59 p.m. Pacific Standard Time, of the twenty-first day after the date of 
mailing of the notice.

2. Exercise of Warrant

The purchase rights represented by this Warrant are exercisable by the 
registered holder hereof, in whole or in part, at any time and from time to 
time at or prior to the Expiration Time by the surrender of this Warrant and 
the Notice of Exercise form attached hereto duly executed to the office of the 
Corporation at 7620 S.W. Bridgeport Road, Portland, Oregon  97224 (or such 
other office or agency of the Corporation as it may designate by notice in 
writing to the registered holder hereof at the address of such holder 
appearing on the books of the Corporation), and upon payment of the Exercise 
Price for the shares thereby purchased (by cash or by check or bank draft 
payable to the order of the Corporation or by cancellation of indebtedness of 
the Corporation to the holder hereof, if any, at the time of exercise in an 
amount equal to the purchase price of the shares thereby purchased); whereupon 
the holder of this Warrant shall be entitled to receive from the Corporation a 
stock certificate in proper form representing the number of shares of Warrant 
Stock so purchased.

3. Issuance of Shares; No Fractional Shares of Scrip

Certificates for shares purchased hereunder shall be delivered to the holder 
hereof by the Corporation's transfer agent at the Corporation's expense within 
a reasonable time after the date on which this Warrant shall have been 
exercised in accordance with the terms hereof.  Each certificate so delivered 
shall be in such denominations as may be requested by the holder hereof and 
shall be registered in the name of such holder or, subject to applicable laws, 
other name as shall be requested by such holder.  If, upon exercise of this 
Warrant, fewer than all of the shares of Warrant Stock evidenced by this 
Warrant are purchased prior to the Expiration Time, one or more new warrants 
substantially in the form of, and on the terms in, this Warrant will be issued 
for the remaining number of shares of Warrant Stock not purchased upon 
exercise of this Warrant.  The Corporation hereby represents and warrants that 
all shares of Warrant Stock which may be issued upon the exercise of this 
Warrant will, upon such exercise, be duly and validly authorized and issued, 
fully paid and nonassessable and free from all taxes, liens and charges in 
respect of the issuance thereof (other than liens or charges created by or 
imposed upon the holder of the Warrant Stock).  The Corporation agrees that 
the shares so issued shall be and be deemed to be issued to such holder as the 
record owner of such shares as of the close of business on the date on which 
this Warrant shall have been surrendered for exercise in accordance with the 
terms hereof.  No fractional shares or scrip representing fractional shares 
shall be issued upon the exercise of this Warrant.  With respect to any 
fraction of a share called for upon the exercise of this Warrant, an amount 
equal to such fraction multiplied by the then current price at which each 
share may be purchased hereunder shall be paid in cash to the holder of this 
Warrant.

4. Charges, Taxes and Expenses

Issuance of certificates for shares of Warrant Stock upon the exercise of this 
Warrant shall be made without charge to the holder hereof for any issue or 
transfer tax or other incidental expense in respect of the issuance of such 
certificate, all of which taxes and expenses shall be paid by the Corporation, 
and such certificates shall be issued in the name of the holder of this 
Warrant or in such name or names as may be directed by the holder of this 
Warrant; provided, however, that in the event certificates for shares of 
Warrant Stock are to be issued in a name other than the name of the holder of 
this Warrant, this Warrant when surrendered for exercise shall be accompanied 
by the Assignment Form attached hereto duly executed by the holder hereof.

5. No Rights as Shareholders

This Warrant does not entitle the holder hereof to any voting rights or other 
rights as a shareholder of the Corporation prior to the exercise hereof.

6. Registration Rights

This Warrant is a Series "G" Warrant identified in the Registration Rights 
Agreement dated as of June, 1997 between the Corporation and the parties 
listed on the signature pages thereto.  A transferee of this Warrant may 
become a "Holder" as defined in such agreement upon compliance with the 
requirements of such agreement.

7. Exchange and Registry of Warrant

This Warrant is exchangeable, upon the surrender hereof by the registered 
holder at the above-mentioned office or agency of the Corporation, for a new 
Warrant of like tenor and dated as of such exchange.  The Corporation shall 
maintain at the above-mentioned office or agency a registry showing the name 
and address of the registered holder of this Warrant.  This Warrant may be 
surrendered for exchange, transfer or exercise, in accordance with its terms, 
at such office or agency of the Corporation, and the Corporation shall be 
entitled to rely in all respects, prior to written notice to the contrary, 
upon such registry.

8. Loss, Theft, Destruction or Mutilation of Warrant 

Upon receipt by the Corporation of evidence reasonably satisfactory to it of 
the loss, theft, destruction or mutilation of this Warrant, and in case of 
loss, theft or destruction of indemnity or security reasonably satisfactory to 
it, and upon reimbursement to the Corporation of all reasonable expenses 
incidental thereto, and upon surrender and cancellation of this Warrant, if 
mutilated, the Corporation will make and deliver a new Warrant of like tenor 
and dated as of such cancellation, in lieu of this Warrant.

9. Saturdays, Sundays and Holidays

If the last or appointed day for the taking of any action or the expiration of 
any right required or granted herein shall be a Saturday or a Sunday or shall 
be a legal holiday, then such action may be taken or such right may be 
exercised on the next succeeding day not a Saturday, Sunday or legal holiday.

10. Merger, Sale of Assets, Etc.

If at any time the Corporation proposes to merge or consolidate with or into 
any other corporation, effect any reorganization, or sell or convey all or 
substantially all of its assets to any other entity, then, as a condition of 
such reorganization, consolidation, merger, sale or conveyance, the 
Corporation or its successor, as the case may be, shall enter into a 
supplemental agreement to make lawful and adequate provision whereby the 
holder shall have the right to receive, upon exercise of the Warrant, the kind 
and amount of equity securities which would have been received upon such 
reorganization, consolidation, merger, sale or conveyance by a holder of a 
number of shares of common stock equal to the number of shares issuable upon 
exercise of the Warrant immediately prior to such reorganization, 
consolidation, merger, sale or conveyance.  If the property to be received 
upon such reorganization, consolidation, merger, sale or conveyance is not 
equity securities, the Corporation shall give the holder of this Warrant ten 
(10) business days prior written notice of the proposed effective date of such 
transaction, and if this Warrant has not been exercised by or on the effective 
date of such transaction, it shall terminate.

11. Subdivision, Combination, Reclassification, Conversion, Etc.

If the Corporation at any time shall, by subdivision, combination, 
reclassification of securities or otherwise, change the Warrant Stock into the 
same or a different number of securities of any class or classes, this Warrant 
shall thereafter entitle the holder to acquire such number and kind of 
securities as would have been issuable in respect of the Warrant Stock (or 
other securities which were subject to the purchase rights under this Warrant 
immediately prior to such subdivision, combination, reclassification or other 
change) as the result of such change if this Warrant had been exercised in 
full for cash immediately prior to such change.  The Exercise Price hereunder 
shall be adjusted if and to the extent necessary to reflect such change.  If 
the Warrant Stock or other securities issuable upon exercise hereof are 
subdivided or combined into a greater or smaller number of shares of such 
security, the number of shares issuable hereunder shall be proportionately 
increased or decreased, as the case may be, and the Exercise Price shall be 
proportionately reduced or increased, as the case may be, in both cases 
according to the ratio which the total number of shares of such security to be 
outstanding immediately after such even bears to the total number of shares of 
such security outstanding immediately prior to such event.  The Corporation 
shall give the holder prompt written notice of any change in the type of 
securities issuable hereunder, any adjustment of the Exercise Price for the 
securities issuable hereunder, and any increase or decrease in the number of 
shares issuable hereunder.

12. Transferability; Compliance with Securities Laws

(a) This Warrant may not be transferred or assigned in whole or in part 
without compliance with all applicable federal and state securities laws by 
the transferor and transferee (including the delivery of investment 
representation letters and legal opinions reasonably satisfactory to the 
Corporation, if requested by the Corporation).  Subject such restrictions, 
prior to the Expiration Time, this Warrant and all rights hereunder are 
transferable by the holder hereof, in whole or in part, at the office or 
agency of the Corporation referred to in Section 1 hereof.  Any such transfer 
shall be made in person or by the holder's duly authorized attorney, upon 
surrender of this Warrant together with the Assignment Form attached hereto 
properly endorsed.

(b) The Holder of this Warrant, by acceptance hereof, acknowledges that this 
Warrant and the Warrant Stock issuable upon exercise hereof are being acquired 
solely for the holder's own account and not as a nominee for any other party, 
and for investment, and that the holder will not offer, sell or otherwise 
dispose of this Warrant or any shares of Warrant Stock to be issued upon 
exercise hereof except under circumstances that will not result in a violation 
of the Securities Act of 1933, as amended, or any state securities laws.  Upon 
exercise of this Warrant, the holder shall, if requested by the Corporation, 
confirm in writing, in a form satisfactory to the Corporation, that the shares 
of Warrant Stock so purchased are being acquired solely for holder's own 
account and not as a nominee for any other party, for investment, and not with 
a view toward distribution or resale.

(c) The Warrant Stock has not been and will not be registered under the 
Securities Act of 1933, as amended, and this Warrant may not be exercised 
except by (i) the original purchaser of this Warrant from the Corporation or 
(ii) an "accredited investor" as defined in Rule 501(a) under the Securities 
Act of 1933, as amended.  Each certificate representing the Warrant Stock or 
other securities issued in respect of the Warrant Stock upon any stock split, 
stock dividend, recapitalization, merger, consolidation or similar event, 
shall be stamped or otherwise imprinted with a legend substantially in the 
following form (in addition to any legend required under applicable securities 
laws):

THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER UNITED STATES 
FEDERAL OR STATE SECURITIES LAWS AND MAY NOT BE OFFERED FOR SALE, SOLD OR 
OTHERWISE TRANSFERRED OR ASSIGNED FOR VALUE, DIRECTLY OR INDIRECTLY, NOR MAY 
THE SECURITIES BE TRANSFERRED ON THE BOOKS OF THE CORPORATION, WITHOUT 
REGISTRATION OF SUCH SECURITIES UNDER ALL APPLICABLE UNITED STATES FEDERAL OR 
STATE SECURITIES LAWS OR COMPLIANCE WITH AN APPLICABLE EXEMPTION THEREFROM, 
SUCH COMPLIANCE, AT THE OPTION OF THE CORPORATION, TO BE EVIDENCED BY AN 
OPINION OF SHAREHOLDER'S COUNSEL, IN FORM ACCEPTABLE TO THE CORPORATION, 
THAT NO VIOLATION OF SUCH REGISTRATION PROVISIONS WOULD RESULT FROM ANY 
PROPOSED TRANSFER OR ASSIGNMENT.

13. Representations and Warranties

The Corporation hereby represents and warrants to the holder hereof that:

(a) during the period this Warrant is outstanding, the Corporation will 
reserve from its authorized and unissued common stock a sufficient number of 
shares to provide for the issuance of Warrant Stock upon the exercise of this 
Warrant;

(b) the issuance of this Warrant shall constitute full authority to the 
Corporation's officers who are charged with the duty of executing stock 
certificates to execute and issue the necessary certificates for the shares of 
Warrant Stock issuable upon exercise of this Warrant;

(c) the Corporation has all requisite legal and corporate power to execute and 
deliver this Warrant, to sell and issue the Warrant Stock hereunder, to issue 
the common stock issuable upon exercise of the Warrant Stock and to carry out 
and perform its obligations under the terms of this Warrant; 

(d) all corporate action on the part of the Corporation, its directors and 
shareholders necessary for the authorization, execution, delivery and 
performance of this Warrant by the Corporation, the authorization, sale, 
issuance and delivery of the Warrant Stock, the grant of registration rights 
as provided herein and the performance of the Corporation's obligations 
hereunder has been taken;

(e) the Warrant Stock, when issued in compliance with the provisions of this 
Warrant and the Corporation's Articles of Incorporation (as they may be 
amended from time to time (the "Articles")), will be validly issued, fully 
paid and nonassessable, and free of all taxes, liens or encumbrances with 
respect to the issue thereof, and will be issued in compliance with all 
applicable federal and state securities laws; and

(f) the issuance of the Warrant Stock will not be subject to any preemptive 
rights, rights of first refusal or similar rights.

14. Corporation

The Corporation will not, by amendment of its Articles or through any 
reorganization, recapitalization, transfer of assets, consolidation, merger, 
dissolution, issue or sale of securities or any other action, avoid or seek to 
avoid the observance or performance of any of the terms to be observed or 
performed hereunder by the Corporation, but will at all times in good faith 
assist in the carrying out of all the provisions of this Warrant and in the 
taking of all such action as may be necessary or appropriate in order to 
protect the rights of the holder of the Warrant against impairment.

15. Governing Law

This Warrant shall be governed by and construed in accordance with the laws of 
the State of Oregon.

IN WITNESS WHEREOF, the Corporation has caused this Warrant to be executed by 
its duly authorized officers.

Dated: ___________ , 1997

BIOJECT MEDICAL TECHNOLOGIES INC.

By:____________________________________
Name: Peggy J. Miller
Title: Vice President, Chief Financial Officer & Secretary 

		     NOTICE OF EXERCISE

To: Bioject Medical Technologies Inc.

(1) [Please check one]

___The undersigned hereby elects to purchase ____shares of common stock of 
Bioject Medical Technologies Inc. pursuant to the terms of the attached 
Warrant, and tenders herewith payment of the purchase price in full, 
together with all applicable transfer taxes, if any.

   or

___ The undersigned hereby irrevocably commits to purchase ___ shares of      
common stock of Bioject Medical Technologies Inc. pursuant to the terms of 
the attached Warrant, and commits to tender payment of the purchase price 
in full, together with all applicable transfer taxes, if any, subject only 
to the conditions that (i) a Form S-3 registration statement pursuant to  
which the shares of common stock will be registered for resale is filed   
and becomes effective and (ii) the average of the bid and asked prices for 
shares of the common stock as quoted by the Nasdaq National Market for the 
day before the date of effectiveness is greater than $1.71.

(2) In exercising this Warrant, the undersigned hereby confirms and 
acknowledges that the shares of common stock to be issued upon exercise hereof 
are being acquired solely for the account of the undersigned and not as a 
nominee for any other party, and for investment, and that the undersigned will 
not offer, sell or otherwise dispose of any such shares of common stock except 
under circumstances that will not result in a violation of the Securities Act 
of 1933, as amended, or any state securities laws.

(3) Please issue a certificate or certificates representing said shares of 
common stock in the name of the undersigned or in such other name as is 
specified below:

(Name)___________________________________________

(Address)__________________________________________

(3) The undersigned represents that (a) he, she or it is the original 
purchaser from the Corporation of the attached Warrant or an "accredited 
investor" within the meaning of Rule 501(a) under the Securities Act of 1933, 
as amended and (b) the aforesaid shares of common stock are being acquired for 
the account of the undersigned for investment and not with a view to, or for 
resale in connection with, the distribution thereof and that the undersigned 
has no present intention of distributing or reselling such shares.


(Date)_________________________(Signature)__________________________

			    ASSIGNMENT FORM

(To assign the foregoing Warrant, execute this form and supply required 
information.  Do not use this form to purchase shares.)


FOR VALUE RECEIVED, the undersigned registered owner of this Warrant hereby 
sells, assigns and transfers unto the Assignee named below all of the rights 
of the undersigned under the within Warrant, with respect to the number of 
shares of common stock of Bioject Medical Technologies Inc. set forth below:

Name of Assignee               Address                 No. of Shares
_________________             _____________           _______________ 


and does hereby irrevocably constitute and appoint Attorney ____________
to make such transfer on the books of Bioject Medical Technologies Inc., 
maintained for the purpose, with full power of substitution in the premises.

The undersigned also represents that, by assignment hereof, the Assignee 
acknowledges that this Warrant and the shares of stock to be issued upon 
exercise hereof are being acquired for investment and that the Assignee will 
not offer, sell or otherwise dispose of this Warrant or any shares of stock to 
be issued upon exercise hereof except under circumstances which will not 
result in a violation of the Securities Act of 1933, as amended, or any state 
securities laws.  Further, the Assignee shall, if requested by the 
Corporation, confirm in writing, in a form satisfactory to the Corporation, 
that the shares of stock so purchased are being acquired for investment and 
not with a view toward distribution or resale.

Dated:_____________________________

Holder's Signature:___________________________

Holder's Address: ____________________________  

Guaranteed Signature:_________________________

NOTE: The signature to this Assignment Form must correspond with the name as 
it appears on the face of the Warrant, without alteration or enlargement or 
any change whatever, and must be guaranteed by a bank or trust company.  
Officers of corporations and those action in a fiduciary or other 
representative capacity should file proper evidence of authority to assign the 
foregoing Warrant.

EX-10.38

							  Exhibit 10.38

			    REGISTRATION RIGHTS AGREEMENT

This Agreement is made as of June ___ , 1997 by and among BIOJECT MEDICAL 
TECHNOLOGIES INC., an Oregon corporation (the "Corporation"), and the 
investors listed on Schedule A hereto (the "Investors").

						  RECITALS

A. Simultaneously herewith, the Corporation is selling to the Investors and 
the Investors are purchasing from the Corporation an aggregate of _________ 
shares of the Corporation's Common Stock and warrants to purchase up to an 
aggregate of  _____  shares of the Corporation's Common Stock (the "Warrants") 
pursuant to the Stock Subscription Agreement dated June___ , 1997 (the 
"Subscription Agreement").

B. It is a condition precedent to the Subscription Agreement that the parties 
enter into this Agreement.

				  AGREEMENT

NOW, THEREFORE, it is hereby agreed as follows:

1. Certain Definitions

As used in this Agreement, the following terms shall have the following 
respective meanings:

"Binding Commitment" shall mean an executed Notice of Exercise of a Warrant by 
a Holder constituting an irrevocable and binding commitment to purchase the 
common stock issuable upon exercise of the Warrant, subject only to the 
conditions that (i) a Form S-3 registration statement pursuant to which the 
Warrant Shares will be registered for resale is filed and becomes effective 
and (ii) the average of the bid and asked prices for shares of the 
Corporation's common stock as quoted by the Nasdaq National Market for the day 
before the date of effectiveness is greater than $0.71.

"Common Stock" shall mean shares of common stock, without par value, of the 
Corporation.

"Commission" shall mean the Securities and Exchange Commission.

"Holder" shall mean the holders of Registrable Securities and any person 
holding such securities to whom the rights under this Agreement have been 
transferred in accordance with Section 2.8 hereof.

"Initiating Holders" shall mean any Holder or Holders of the Registrable 
Securities initiating a registration request pursuant to Sections 2.2(b) and 
2.2(c).

"Registrable Securities" means (i) all shares of the Corporation's Common 
Stock acquired pursuant to the Subscription Agreement ("Subscription Shares"), 
or acquired upon exercise of the Series "G" Warrants ("Warrant 
Shares")(collectively, the "Shares"), (ii) any Common Stock or other 
securities of the Corporation issued or issuable with respect to, or in 
exchange for or in replacement of the Shares or such additional shares upon 
any stock split, stock dividend, recapitalization, or similar event; provided, 
however, that shares of Common Stock or other securities shall only be treated 
as Registrable Securities for the purposes of Section 2 hereof if and so long 
as they have not been sold pursuant to Rule 144 under the Securities Act or 
pursuant to an effective Registration Statement under the Securities Act, or 
otherwise to or through a broker or dealer or underwriter in a public 
distribution or a public securities transaction.

The terms "register," "registered" and "registration" refer to a registration 
effected by preparing and filing a registration statement in compliance with 
the Securities Act, and the declaration or ordering of the effectiveness of 
such registration statement.

"Registration Expenses" shall mean all expenses, except as otherwise stated 
below, incurred by the Corporation in complying with Section 2 hereof, 
including, without limitation, all registration, qualification and filing 
fees, printing expenses, escrow fees, fees and disbursements of counsel for 
the Corporation and one special counsel to the selling Holders, blue sky fees 
and expenses, fees to Nasdaq to list the Shares or American Stock Transfer and 
Trust Company to issue the Shares, and the expense of any special audits 
incident to or required by any such registration.

"Securities Act" shall mean the Securities Act of 1933, as amended, or any 
similar federal statute and the rules and regulations of the Commission 
thereunder, all as the same shall be in effect at the time.

"Selling Expenses" shall mean all underwriting discounts, selling commissions 
and stock transfer taxes applicable to the securities registered by the 
selling Holders and any other expenses that are not Registration Expenses and 
that are incurred by the selling Holders.

"Subscription Shares" are defined under "Registrable Securities."

"Warrant Shares" are defined under "Registrable Securities."

2. Registration Rights

2.1 Company Registration

a) Notice of Registration.  If at any time or from time to time the 
Corporation shall determine to register any of its securities, either for its 
own account or the account of a security holder or holders, other than a 
registration relating solely to employee benefit plans or a registration 
relating solely to a Commission Rule 145 transaction, the Corporation will:

(i) promptly give to each Holder written notice thereof; and

(ii) subject to Section 2.1(b), include in such registration (and any related 
qualification under blue sky laws or other compliance), and in any 
underwriting involved therein, all the Registrable Securities specified in a 
written request or requests made within 20 days after receipt of such written 
notice from the Corporation, by any Holder.
(b) Underwriting.  If the registration of which the Corporation gives notice 
is for a registered public offering involving an underwriting, the Corporation 
shall so advise the Holders as a part of the written notice given pursuant to 
Section 2.1(a) hereof.  In such event the right of any Holder to registration 
pursuant to this Section 2.1 shall be conditioned upon such Holder's 
participation in such underwriting and the inclusion of Registrable Securities 
in the underwriting to the extent provided herein.  All Holders proposing to 
distribute their securities through such underwriting shall (together with the 
Corporation) enter into an underwriting agreement in customary form with the 
managing underwriter selected for such underwriting by the Corporation.  
Notwithstanding any other provision of this Section 2.1, if the managing 
underwriter determines that marketing factors require a limitation of the 
number of shares to be underwritten, the managing underwriter may limit the 
Registrable Securities and other securities to be distributed through such 
underwriting, for the account of the requesting Holders to 20% of the total 
number of shares to be distributed.  The Corporation shall so advise all 
Holders distributing their securities through such underwriting of such 
limitations and, subject to the foregoing rights of the Investors, the number 
of shares of Registrable Securities, if any, that may be included in the 
registration (and underwriting, if any) shall be allocated among all Holders 
in proportion, as nearly as practicable, to the respective amounts of 
Registrable Securities requested by such Holders to be included in such 
Registration Statement.  To facilitate the allocation of shares in accordance 
with the above provisions, the Corporation may round the number of shares 
allocated to any Holder or holder to the nearest 100 shares.

(c) Right to Terminate Registration.  The Corporation shall have the right to 
terminate or withdraw any registration initiated by it under this Section 2.1 
prior to the effectiveness of such registration whether or not any Holder has 
elected to include securities in such registration.  The Registration Expenses 
of such withdrawn registration shall be borne by the Corporation in accordance 
with Section 2.3 hereof.

2.2 Demand Registration
	
(a) The Corporation shall use its best efforts to file within thirty (30) days 
of the date of this Agreement a registration statement on Form S-3 for the 
resale of the Subscription Shares and shall use its best efforts to cause such 
registration statement to become effective as expeditiously as reasonably 
practical.  The Corporation shall be obligated to prepare, file and cause to 
be effective only one registration statement pursuant to this Section 2.2(a). 
Further, the Corporation shall use all reasonable efforts to cause such 
registration to be a non-underwritten shelf registration pursuant to Rule 415 
under the Securities Act and to cause such shelf registration to be maintained 
effective for at least two (2) years.

(b) Any Initiating Holder or Holders of an aggregate of at least a majority of 
the Warrant Shares for which Binding Commitments have been received by the 
Corporation, may request registration of such Holder(s)' Warrant Shares when 
Binding Commitments to exercise _____ Warrants (representing approximately 51% 
of the original number of Warrants) have been received by the Corporation.   
Upon receipt of such request (specifying that it is being made pursuant to 
this Section 2.2(b)), the Corporation shall promptly prepare and file a 
registration statement on Form S-3 under the Securities Act covering the 
Warrant Shares that are the subject of such request and shall use its best 
efforts to cause such registration statement to become effective as 
expeditiously as reasonably practical.  The Corporation shall be obligated to 
prepare, file and cause to be effective only one registration statement 
pursuant to this Section 2.2(b).

Upon the receipt of such request, the Corporation shall:

(i) promptly give to each remaining Holder written notice that a registration 
is to be effected; and

(ii) include in such registration (and any related qualification under blue 
sky laws or other compliance) all the Warrant Shares specified in a written 
request or requests made within 10 days after such written notice was sent by 
the Corporation, by any Holder.  However, no Warrant Shares shall be included 
in such registration if a Binding Commitment has not been received by the 
Corporation for such Warrant Shares.

Further, the Corporation shall use all reasonable efforts to cause such 
registration to be a non-underwritten shelf registration pursuant to Rule 415 
under the Securities Act and to cause such shelf registration to be maintained 
effective for at least two (2) years.

(c) Any Initiating Holder or Holders of an aggregate of at least a majority of 
the Warrant Shares, may request registration of such Holder(s)' Warrant Shares 
when the Corporation has called the Warrants for exercise, in whole or in 
part, in accordance with Section 1 of the Series "G" Warrants.  Upon receipt 
of such request (specifying that it is being made pursuant to this Section 
2.2(c)), the Corporation shall promptly prepare and file a registration 
statement on Form S-3 under the Securities Act covering the Warrant Shares 
that are the subject of such request and shall use its best efforts to cause 
such registration statement to become effective as expeditiously as reasonably 
practical.  

Upon the receipt of such request, the Corporation shall:

(i) promptly give to each remaining Holder written notice that a registration 
is to be effected; and

(ii) include in such registration (and any related qualification under blue 
sky laws or other compliance) all the Warrant Shares specified in a written 
request or requests made within 10 days after such written notice was sent by 
the Corporation, by any Holder.

Further, the Corporation shall use all reasonable efforts to cause such 
registration to be a non-underwritten shelf registration pursuant to Rule 415 
under the Securities Act and to cause such shelf registration to be maintained 
effective for at least two (2) years.

(d) Notwithstanding the foregoing, the Corporation shall not be obligated to 
take any action pursuant to this Section 2.2: (i) in any particular 
jurisdiction in which the Corporation would be required to execute a general 
consent to service of process in effecting such registration, qualification or 
compliance unless the Corporation is already subject to service in such 
jurisdiction and except as may be required by the Securities Act; or (ii) if 
the Corporation shall furnish to the Holders a certificate signed by the 
Chairman or President of the Corporation stating that the Corporation has 
reasonably determined that it should postpone for a specified period of time 
not to exceed 120 days in the case of clause (A) below, or 45 days in the case 
of clause (B) below (each, a "Blackout Period"), any action pursuant to this 
Section, including, without limitation, the preparation and/or filing of a 
registration statement or prospectus or any amendments or supplements to any 
registration statement or prospectus, because any such filing would (A) 
materially impede, delay or otherwise interfere with an offer or sale of 
securities, acquisition, corporate reorganization or other significant 
transaction involving the Corporation, or (B) require disclosure of material 
information (other than an event described in clause (A) above) which, if 
disclosed at that time, would be materially harmful to the interests of the 
Corporation and its shareholders.  Upon delivery of such a certificate to the 
Holders by the Corporation, each of the Holders covenants that he shall (X) 
keep the fact of the notice strictly confidential, (Y) promptly halt any 
offer, sale, trading or transfer by him and his affiliates of any Common Stock 
for the duration of the Blackout Period set forth in the certificate or until 
the Blackout Period is earlier terminated by the Corporation and (Z) promptly 
halt any use or distribution of the registration statement and prospectus by 
him and his affiliates for the duration of the Blackout Period or until such 
Blackout Period is earlier terminated by the Corporation.  The Corporation 
shall not be entitled to deliver a certificate and impose a Blackout Period 
pursuant to Clause A more than once in any twelve month period.

2.3 Expenses of Registration

All Registration Expenses incurred in connection with registration pursuant to 
Sections 2.1 and 2.2 shall be borne by the Corporation.  All Selling Expenses 
relating to securities registered on behalf of the Holders shall be borne by 
the Holders of securities included in such registration pro rata, severally 
and not jointly, among each other on the basis of the number of shares so 
registered.

2.4 Registration Procedures

In the case of each registration effected by the Corporation pursuant to this 
Section 2, the Corporation will keep each Holder advised in writing as to the 
initiation of each registration and as to the completion thereof.  At its 
expense the Corporation will:

(a) Prepare and file with the Commission a registration statement with respect 
to such securities and use its best efforts to cause such registration 
statement to become and remain effective for at least two (2) years or, if 
earlier, until the distribution described in the registration statement has 
been completed;

(b) Prepare and file with the Commission during the period specified in 
Section 2.4(a) such amendments and supplements to such registration statement 
and the prospectus used in connection with such registration statement as may 
be necessary to comply with the provisions of the Securities Act with respect 
to the disposition of all securities covered by such registration statement;

(c) Furnish to the Holders participating in such registration and to the 
underwriters of the securities being registered such reasonable number of 
copies of the registration statement, preliminary prospectus, final prospectus 
and such other documents as the Holders and such underwriters may reasonably 
request in order to facilitate the public offering of such securities;

(d) Furnish, at the request of any Holder requesting registration of 
Registrable Securities at the time such securities are delivered to the 
underwriters (if any) for sale in connection with a registration pursuant to 
this Section 2, (i) an opinion, dated such date, of the counsel representing 
the Corporation for the purposes of such registration, in form and substance 
as is customarily given to underwriters in an underwritten public offering, 
addressed to the underwriters and to the Holders requesting registration of 
Registrable Securities and (ii) a letter dated the date of commencement of the 
offering and a "bring-down" letter dated as of the closing date of such 
offering, from the independent accountants of the Corporation, in form and 
substance as is customarily given by independent accountants to underwriters 
in an underwritten public offering, addressed to the underwriters, if any, and 
to the Holders requesting registration of Registrable Securities.

2.5 Indemnification

(a) The Corporation will indemnify each Holder and each person controlling 
such Holder within the meaning of Section 15 of the Securities Act, with 
respect to which registration has been effected pursuant to this Section 2, 
and each underwriter, if any, and each person who controls any underwriter 
within the meaning of Section 15 of the Securities Act, against all expenses, 
claims, losses, damages or liabilities (or actions in respect thereof), 
including any of the foregoing incurred in settlement of any litigation, 
commenced or threatened, arising out of or based on any untrue statement (or 
alleged untrue statement) of a material fact contained in any registration 
statement, prospectus, offering circular or other document, or any amendment 
or supplement thereto, incident to any such registration, qualification or 
compliance, or based on any omission (or alleged omission) to state therein a 
material fact required to be stated therein or necessary to make the 
statements therein, in light of the circumstances in which they were made, not 
misleading, or any violation by the Corporation of the Securities Act or any 
other applicable federal and state securities laws or any rules or regulations 
promulgated thereunder in connection with any such registration, qualification 
or compliance, and the Corporation will reimburse each such Holder, each of 
its officers, directors, partners, and legal counsel and each person 
controlling such Holder, each such underwriter and each person who controls 
any such underwriter, for any legal and any other expenses reasonably incurred 
in connection with investigating, preparing or defending any such claim, loss, 
damage, liability or action, provided that the Corporation will not be liable 
in any such case to the extent that any such claim, loss, damage, liability or 
expense arises out of or is based on any untrue statement or omission or 
alleged untrue statement or omission, made in reliance upon and in conformity 
with written information furnished to the Corporation by such Holder, 
controlling person or underwriter and stated to be specifically for use 
therein.

(b) Each Holder will, if Registrable Securities held by such Holder are 
included in the securities as to which such registration, qualification or 
compliance is being effected, indemnify the Corporation, each of its directors 
and officers, each underwriter, if any, of the Corporation's securities 
covered by such a registration statement, each person who controls the 
Corporation or such underwriter within the meaning of Section 15 of the 
Securities Act, and each other Holder, each of its officers and directors, and 
each person controlling such Holder within the meaning of Section 15 of the 
Securities Act, against all claims, losses, damages and liabilities (or 
actions in respect thereof) arising out of or based on any untrue statement 
(or alleged untrue statement) of a material fact contained in any such 
registration statement, prospectus, offering circular or other document, or 
any omission (or alleged omission) to state therein a material fact required 
to be stated therein or necessary to make the statements therein not 
misleading, and will reimburse the Corporation, such Holders, and such 
directors, officers, underwriters or control persons for any legal or any 
other expenses reasonably incurred in connection with investigating or 
defending any such claim, loss, damage, liability or action, in each case to 
the extent, but only to the extent, that such untrue statement (or alleged 
untrue statement) or omission (or alleged omission) is made in such 
registration statement, prospectus, offering circular or other document in 
reliance upon and in conformity with written information furnished to the 
Corporation by such Holder and stated to be specifically for use therein 
Notwithstanding the foregoing, the liability of each Holder under this 
subsection (b) shall be limited to the proportion of any such loss, claim, 
damage, liability or expense which is equal to the proportion that the public 
offering price of the shares sold by such Holder under such registration 
statement bears to the total public offering price of all securities sold 
thereunder, but not to exceed the proceeds received by such Holder from the 
sale of Registrable Securities covered by such registration statement.

(c) Each party entitled to indemnification under this Section 2.5 (the 
"Indemnified Party") shall give notice to the party required to provide 
indemnification (the "Indemnifying Party") promptly after such Indemnified 
Party has actual knowledge of any claim as to which indemnity may be sought, 
and shall permit the Indemnifying Party to assume the defense of any such 
claim or any litigation resulting therefrom, provided that counsel for the 
Indemnifying Party, who shall conduct the defense of such claim or litigation 
resulting therefrom, shall be approved by the Indemnified Party (whose 
approval shall not unreasonably be withheld), and the Indemnified Party may 
participate in such defense at such party's expense, and provided further that 
the failure of any Indemnified Party to give notice as provided herein shall 
not relieve the Indemnifying Party of its obligations under this Section 2 
unless the failure to give such notice is materially prejudicial to an 
Indemnifying Party's ability to defend such action and provided further, that 
the Indemnifying Party shall not assume the defense for matters as to which 
there is a conflict of interest or separate and different defenses but shall 
bear the expense of such defense nevertheless.  Each Indemnified Party shall 
furnish such information regarding itself or the claim in question as an 
Indemnifying Party may reasonably request in writing and as shall be 
reasonably required in connection with the defense of such claim and 
litigation resulting therefrom.  No Indemnifying Party, in the defense of any 
such claim or litigation, shall, except with the consent of each Indemnified 
Party, consent to entry of any judgment or enter into any settlement which 
does not include as an unconditional term thereof the giving by the claimant 
or plaintiff to such Indemnified Party of a release from all liability in 
respect to such claim or litigation.  Notwithstanding the other provisions of 
this Agreement, no Indemnifying Party shall be obligated to indemnify any 
Indemnified Party for amounts paid by the Indemnified Party in settlement of 
any loss, claim, damage, liability or action if such settlement is effected 
without the consent of the Indemnifying Party (which consent has not been 
unreasonably withheld).

(d) If the indemnification provided for paragraphs (a) through (c) of this 
Section 2.5 is unavailable or insufficient to hold harmless an Indemnified 
Party under such paragraphs in respect of any losses, claims, damages, 
liabilities, expenses or actions in respect thereof referred to therein, then 
each Indemnifying Party shall in lieu of indemnifying such Indemnified Party 
contribute to the amount paid or payable by such Indemnified Party as a result 
of such losses, claims, damages, liabilities or actions in such proportion as 
appropriate to reflect the relative fault of the Corporation, the 
underwriters, and the Holder of such Registrable Securities, respectively, in 
connection with the statements or omissions which resulted in such losses, 
claims, damage, liabilities, expenses or actions in respect thereof as well as 
any other relevant equitable considerations, including the failure to give any 
notice under paragraph (c).  The relative fault shall be determined by 
reference to, among other things, whether the untrue or alleged untrue 
statement of a material fact relates to information supplied by the 
Corporation, on the one hand, or the underwriters or the Holders of such 
Registrable Securities, on the other, and to the parties' relative intent, 
knowledge, access to information and opportunity to correct or prevent such 
statement or omission.  The Corporation and each of the Holders agrees that it 
would not be just and equitable if contributions pursuant to this paragraph 
were determined by pro rata allocation (even if all of the Holders of such 
Registrable Securities were treated as one entity for such purpose) or by any 
other method of allocation which did not take account of the equitable 
considerations referred to above in this paragraph.  The amount paid or 
payable by an indemnified party as a result of the losses, claims, damages, 
liabilities or action in respect thereof, referred to above in this paragraph, 
shall be deemed to include any legal or other expenses reasonably incurred by 
such indemnified party in connection with investigating or defending any such 
action or claim.  Notwithstanding the provisions of this paragraph, no Holder 
shall be required to contribute any amount in excess of the lesser of (i) the 
proportion that the public offering price of shares sold by such Holder under 
such registration statement bears to the total public offering price of all 
securities sold thereunder, but not to exceed the proceeds received by such 
Holder for the sale of Registrable Securities covered by such registration 
statement and (ii) the amount of any damages which they would have otherwise 
been required to pay by reason of such untrue or alleged untrue statement or 
omission.  No person guilty of fraudulent misrepresentations (within the 
meaning of Section 11(f) of the Securities Act), shall be entitled to 
contribution from any person who is not guilty of such fraudulent 
misrepresentation

(e) Notwithstanding the foregoing, to the extent that the provisions on 
indemnification and contribution contained in the underwriting agreement (if 
any) entered into in connection with an underwritten public offering of the 
Registrable Securities are in conflict with the foregoing provisions, the 
provisions in such underwriting agreement shall control.

2.6 Information by Holder

The Holder or Holders of Registrable Securities included in any registration 
shall furnish to the Corporation such information regarding such Holder or 
Holders, the Registrable Securities held by them and the distribution proposed 
by such Holder or Holders as the Corporation may reasonably request in writing 
and as shall be required in connection with any registration, qualification or 
compliance referred to in this Section 2.

2.7 Rule 144 Reporting

With a view to making available the benefits of certain rules and regulations 
of the Commission which may at any time permit the sale of the Registrable 
Securities to the public without registration, the Corporation agrees to use 
its best efforts to:

(a) At all times make and keep public information available, as those terms 
are understood and defined in Rule 144 under the Securities Act;

(b) File with the Commission in a timely manner all reports and other 
documents required of the Corporation under the Securities Act and the 
Securities Exchange Act of 1934, as amended;

(c) So long as a Holder owns any Registrable Securities to furnish to the 
Holder forthwith upon request a written statement by the Corporation as to its 
compliance with the reporting requirements of said Rule 144, and of the 
Securities Act and the Securities Exchange Act of 1934, a copy of the most 
recent annual or quarterly report of the Corporation, and such other reports 
and documents of the Corporation and other information in the possession of or 
reasonably obtainable by the Corporation as a Holder may reasonably request in 
availing itself of any rule or regulation of the Commission allowing a Holder 
to sell any such securities without registration.

2.8 Transfer of Registration Rights

The rights to cause the Corporation to register securities granted Holders 
under this Section 2 may be assigned (a) to a transferee or assignee in 
connection with any transfer or assignment of Registrable Securities by a 
Holder of not less than 25,000 shares of Registrable Securities (as presently 
constituted and subject to subsequent adjustments for stock splits, stock 
dividends, reverse stock splits, and the like), or (b) to the estate of a 
Holder, provided in each case that such transfer may otherwise be effected in 
accordance with applicable securities laws and written notice of the transfer 
is given to the Corporation at the time of or within a reasonable time after 
such transfer or assignment, stating the name and address of the transferee or 
assignee and identifying the Registrable Securities with respect to which such 
registration rights are being transferred or assigned, and provided, further, 
that the transferee or assignee of such rights agrees in writing to be bound 
by the terms of this Agreement as if such transferee were a party hereto.

2.9 Standoff Agreement

Each Holder agrees, in connection with registered public offerings of the 
Corporation's securities for the account of the Corporation, upon request of 
the Corporation or the underwriters managing any underwritten offering of the 
Corporation's securities, not to sell, make any short sale of or otherwise 
dispose of any Registrable Securities (other than those included in the 
registration) without the prior written consent of the Corporation or such 
underwriters, as the case may be, for such period of time (not to exceed 120 
days in the case of other public offerings) from the effective date of such 
registration as may be requested by the underwriters, provided, that the 
officers and directors of the Corporation who own stock of the Corporation 
also agree to such restrictions.

2.10 Termination of Registration Rights

The rights granted under this Section 2 shall terminate on the earlier of June 
___, 2002 or such time as the aggregate number of Registrable Securities held 
by all Holders represents less than one percent of the outstanding shares of 
the Corporation's Common Stock.

2.11 Delay of Registration

No Holder or Holders shall have any right to take any action to restrain, 
enjoin, or otherwise delay any registration as a result of any controversy 
that might arise with respect to the interpretation or implementation of this 
Section 2.

2.12 Use of Form S-3

With a view to maintaining its eligibility to use Form S-3, the Corporation 
agrees to use its best efforts to file with the Commission in a timely manner 
(i) all the material required to be filed pursuant to Sections 13, 14 or 15(d) 
of the Securities Exchange Act of 1934, as amended, and (ii) all reports and 
other documents required to be filed by the Corporation under the Securities 
Act and the Securities Exchange Act of 1934, as amended; provided, however, 
that there can be no assurance that the Corporation will remain eligible for 
use of Form S-3 or that any Form S-3 filed by the Corporation with respect to 
the Registrable Securities will be declared effective.

3. Miscellaneous

3.1 Waivers and Amendments

With the written consent of both the Corporation and Holders of a majority of 
outstanding Registrable Securities originally acquired by the Investors then 
held by Holders (voting together as a class), the obligations of the 
Corporation and the rights of such Holders of Registrable Securities under 
this Agreement may be waived (either generally or in a particular instance, 
and either for a specified period of time or indefinitely), and with the same 
consent the Corporation, when authorized by resolution of its Board of 
Directors, may enter into a supplementary agreement for the purpose of adding 
any provisions to or changing in any manner or eliminating any of the 
provisions of this Agreement.  Neither this Agreement nor any provisions 
hereof may be changed, waived, discharged or terminated orally, but only by a 
signed statement in writing.

3.2 Governing Law

This Agreement shall be governed in all respects by the laws of the State of 
Oregon as such laws are applied to agreements between Oregon residents entered 
into and to be performed entirely within Oregon.

3.3 Successors and Assigns

Except as otherwise expressly provided herein, the Provisions hereof shall 
inure to the benefit of, and be binding upon, the successors, assigns, heirs, 
executors and administrators of the parties hereto.

3.4 Entire Agreement

This Agreement constitutes the full and entire understanding and agreement 
between the parties with regard to the subjects hereof.

3.5 Notices

All notices and other communications required or permitted hereunder shall be 
effective upon receipt and shall be in writing and may be delivered in person, 
by telecopy, electronic mail, overnight delivery service or U.S. mail, in 
which event it may be mailed by first class, postage prepaid, addressed (a) if 
to one of the Investors, at the address set forth on the signature page(s) to 
the Subscription Agreement, or at such other address as the Holder shall have 
furnished to the Corporation, or (b) if to the Corporation, at 7620 SW 
Bridgeport Road, Portland, Oregon 97224, Attention:  President, or at such 
other address as shall have furnished to the Holders in writing.  
Notwithstanding the foregoing, all notices and communications to addresses 
outside the United States shall be given by telecopier and confirmed in 
writing sent by overnight or two-day courier service.

3.6 Titles and Subtitles

The titles of the paragraphs and subparagraphs of this Agreement are for 
convenience of reference only and are not to be considered in construing this 
Agreement.

3.7 Litigation; Prevailing Party

In the event of any litigation between the Corporation and the Investors with 
regard to this Agreement, the prevailing party shall be entitled to 
reimbursement from the nonprevailing party for all reasonable fees and 
expenses of counsel for the prevailing party.

3.8 Nominees

Securities registered in the name of a nominee for a Holder shall, for 
purposes of this Agreement, be treated as being owned by such Holder.

3.9 Counterparts

This Agreement may be executed in any number of counterparts, each of which 
shall be an original, but all of which together shall constitute one 
instrument.  Delivery of a signed counterpart by and between telephone 
facsimile transmission shall between effective as delivery of a manually 
signed counterpart of this Agreement.

IN WITNESS WHEREOF, the parties have executed this Registration Rights 
Agreement as of the date set forth above.

				   BIOJECT MEDICAL TECHNOLOGIES INC.


				    By:________________________________
				    Name:  Peggy J. Miller
				    Title:   Vice President, Chief Financial 
						  Officer & Secretary 

				    INVESTOR

				    Signature_____________________________
				    Print Name___________________________
				    Print Title____________________________

EX-4.3

							   Exhibit 4.3       

			BIOJECT MEDICAL TECHNOLOGIES INC.
			  1992 STOCK INCENTIVE PLAN
			(as amended through July 25, 1996)

1. Purpose. The purpose of this 1992 Stock Incentive Plan (the "Plan") is to 
enable Bioject Medical Technologies Inc., an Oregon corporation (the 
"Company"), to attract and retain the services of (a) selected employees, 
officers and directors of the Company or of any parent or subsidiary 
corporation of the Company, and (b) selected nonemployee agents, consultants, 
advisers and independent contractors of the Company or any parent or 
subsidiary.

2. Shares Subject to the Plan.  Subject to adjustment as provided below and in 
paragraph 11, up to 3,000,000 shares of Common Stock of the Company (the 
"Shares") shall be offered and issued under the Plan.  If an option or a stock 
appreciation right granted under the Plan expires, terminates or is cancelled, 
the unissued Shares subject to such option or stock appreciation right shall 
again be available under the Plan.  If Shares sold or awarded as a bonus under 
the Plan are forfeited to the Company or repurchased by the Company, the 
number of Shares forfeited or repurchased shall again be available under the 
Plan.  

3. Effective Date and Duration of Plan.

(a) Effective Date.  The Plan shall become effective when adopted by the Board 
of Directors of the Company (the "Board").  However, no option granted under 
the Plan shall become exercisable until the Plan is approved by the 
affirmative vote of the holders of a majority of the Common Stock of the 
Company represented at a shareholder meeting at which a quorum is present, and 
any such awards under the Plan prior to such approval shall be conditioned on 
and subject to such approval.  Subject to this limitation, options and stock 
appreciation rights may be granted and Shares may be awarded as bonuses or 
sold under the Plan at any time after the effective date and before 
termination of the Plan.

(b) Duration.  No options or stock appreciation rights may be granted under 
the Plan, no stock bonuses may be awarded under the Plan, and no Shares may be 
sold pursuant to paragraph 8 of the Plan on or after July 30, 2002.  However, 
the Plan shall continue in effect until all Shares available for issuance 
under the Plan have been issued and all restrictions on such Shares have 
lapsed.  The Board may suspend or terminate the Plan at any time, except with 
respect to options, stock appreciation rights and Shares subject to 
restrictions then outstanding under the Plan.  Termination shall not affect 
any outstanding options, stock appreciation rights, any right of the Company 
to repurchase Shares or the forfeitability of Shares issued under the Plan.  

4. Administration.  

(a) The Plan shall be administered by a committee appointed by the Board 
consisting of not less than two directors (the "Committee").  The Committee 
shall determine and designate from time to time the individuals to whom awards 
shall be made, the amount of the awards, and the other terms and conditions of 
the awards; provided, however, that only the Board may amend or terminate the 
Plan as provided in paragraphs 3 and 14.  At any time when the officers and 
directors of the Company are subject to Section 16(b) of the Securities 
Exchange Act of 1934 (the "Exchange Act"), the Committee shall consist solely 
of "disinterested" directors as such term is defined from time to time in 
Rule 16b-3 under the Exchange Act.  No member of the Committee shall be 
eligible to receive any award under the Plan while such person serves as a 
Committee member, except pursuant to paragraph 10.  

(b) Subject to the provisions of the Plan, the Committee may from time to time 
adopt and amend rules and regulations relating to administration of the Plan, 
advance the lapse of any waiting period, accelerate any exercise date, waive 
or modify any restriction applicable to Shares (except those restrictions 
imposed by law) and make all other determinations in the judgment of the 
Committee necessary or desirable for the administration of the Plan.  The 
interpretation and construction of the provisions of the Plan and related 
agreements by the Committee shall be final and conclusive.  The Committee may 
correct any defect or supply any omission or reconcile any inconsistency in 
the Plan or in any related agreement in the manner and to the extent it shall 
deem expedient to carry the Plan into effect, and it shall be the sole and 
final judge of such expediency.  

5. Types of Awards; Eligibility.  The Committee may, from time to time, take 
the following actions under the Plan:  (i) grant Incentive Stock Options, as 
defined in Section 422 of the Internal Revenue Code of 1986, as amended (the 
"Code"), as provided in paragraph 6(b); (ii) grant options other than 
Incentive Stock Options ("Nonstatutory Stock Options") as provided in 
paragraph 6(c); (iii) award stock bonuses as provided in paragraph 7; 
(iv) sell Shares  as provided in paragraph 8; and (v) grant stock appreciation 
rights as provided in paragraph 9.  Any such awards may be made to employees 
(including employees who are officers or directors) of the Company or of any 
parent or subsidiary corporation of the Company, and to other individuals 
described in  paragraph 1 who the Committee believes have made or will make an 
important contribution to the Company or its parent or subsidiaries; provided, 
however, that only employees of the Company or a parent or subsidiary shall be 
eligible to receive Incentive Stock Options under the Plan, and, provided 
further, that directors who are not employees shall receive awards only 
pursuant to paragraph 10.  The Committee shall select the individuals to whom 
awards shall be made and shall specify the action taken with respect to each 
individual to whom an award is made under the Plan.  At the discretion of the 
Committee, an individual may be given an election to surrender an award in 
exchange for the grant of a new award.  

6. Option Grants

(a) Grant.  Each option granted under the Plan shall be evidenced by a stock 
option agreement in such form as the Committee shall prescribe from time to 
time in accordance with the Plan.  With respect to each option grant, the 
Committee shall determine the number of Shares subject to the option, the 
option price, the period of the option, and the time or times at which the 
option may be exercised and whether the option is an Incentive Stock Option or 
a Nonstatutory Stock Option.  

(b) Incentive Stock Options.  Incentive Stock Options granted under the Plan 
shall be subject to the following terms and conditions:

(i) No employee may be granted Incentive Stock Options under the Plan such 
that the aggregate fair market value, on the date of grant, of the Shares with 
respect to which Incentive Stock Options are exercisable for the first time by 
that employee during any calendar year under the Plan and under any other 
incentive stock option plan (within the meaning of Section 422 of the Code) of 
the Company or of any parent or subsidiary corporation of the Company exceeds 
$100,000.

(ii) An Incentive Stock Option may be granted under the Plan to an employee 
possessing more than 10 percent of the total combined voting power of all 
classes of stock of the Company or of any parent or subsidiary corporation of 
the Company only if the option price is at least 110 percent of the fair 
market value, as described in paragraph 6(b)(iv), of the Shares subject to the 
option on the date it is granted, and the option by its terms is not 
exercisable more than five years from the date of grant.

(iii)  Subject to paragraphs 6(b)(ii) and 6(d), Incentive Stock Options 
granted under the Plan shall continue in effect for the period fixed by the 
Committee, except that no Incentive Stock Option shall be exercisable more 
than 10 years from the date of grant.

(iv) the option price per Share shall be determined by the Committee at the 
time of grant.  Subject to paragraph 6(b)(ii), the option price shall not be 
less than 100 percent of the fair market value of the Shares covered by the 
Incentive Stock Option at the date the option is granted.  The fair market 
value shall be deemed to be the average of the closing bid and asked prices 
for the Common Stock of the Company as reported on the National Association of 
Securities Dealers, Inc. Automated Quotation System on the day preceding the 
day the option is granted, or if there has been no sale on that date, on the 
last preceding date on which a sale occurred, or such other reported value of 
the Common Stock of the Company as shall be specified by the Committee.

(v) The Committee may at any time without the consent of the optionee convert 
an Incentive Stock Option into a Nonstatutory Stock Option.  

(c) Nonstatutory Stock Options.  Nonstatutory Stock Options shall be subject 
to the following additional terms and conditions:

(i)  The option price for Nonstatutory Stock Options shall be determined by 
the Committee at the time of grant.  The option price may not be less than 
75 percent of the fair market value of the Shares covered by the Nonstatutory 
Stock Option on the date of grant.  The fair market value of the Shares 
covered by a Nonstatutory Stock Option shall be determined pursuant to 
paragraph 6(b)(iv).  

(ii)  Nonstatutory Stock Options granted under the Plan shall continue in 
effect for the period fixed by the Committee.  

(d) Exercise of Options.  Except as provided in paragraph 6(f) or as 
determined by the Committee, no option granted under the Plan may be exercised 
unless at the time of such exercise the optionee is employed by or in the 
service of the Company or any parent or subsidiary corporation of the Company 
and shall have been so employed or have provided such service continuously 
since the date such option was granted.  Absence on leave or on account of 
illness or disability under rules established by the Committee shall not, 
however, be deemed an interruption of employment for purposes of the Plan.  
Unless otherwise determined by the Committee, vesting of options shall not 
continue during an absence on leave (including an extended illness) or on 
account of disability.  No option may be exercised by an officer or director 
of the Company within six months of the date of grant.  Except as provided in 
paragraphs 6(f), 11 and 12, options granted under the Plan may be exercised 
from time to time over the period stated in each option in such amounts and at 
such times as shall be prescribed by the Committee, provided that options 
shall not be exercised for fractional shares.  Unless otherwise determined by 
the Committee, if the optionee does not exercise an option in any one year 
with respect to the full number of Shares to which the optionee is entitled in 
that year, the optionee's rights shall be cumulative and the optionee may 
purchase those Shares in any subsequent year during the term of the option.

(e) Nontransferability.  Each option granted under the Plan by its terms shall 
be nonassignable and nontransferable by the optionee, either voluntarily or by 
operation of law, except by will or by the laws of descent and distribution of 
the state or country of the optionee's domicile at the time of death, and each 
option by its terms shall be exercisable during the optionee's lifetime only 
by the optionee.

(f) Termination of Employment or Service.

(I) In the event the employment or service of the optionee by the Company or a 
parent or subsidiary corporation of the Company terminates for any reason 
other than because of death or physical disability, the option may be 
exercised at any time prior to the expiration date of the option or the 
expiration of three months after the date of such termination, whichever is 
the shorter period, but only if and to the extent the optionee was entitled to 
exercise the option at the date of such termination.

(ii) In the event of the termination of the optionee's employment or service 
with the Company or a parent or subsidiary corporation of the Company because 
the optionee becomes disabled (within the meaning of Section 22(e)(3) of the 
Code), the option may be exercised at any time prior to the expiration date of 
the option or the expiration of one year after the date of such termination, 
whichever is the shorter period, but only if and to the extent the optionee 
was entitled to exercise the option at the date of such termination. 

(iii) In the event of the death of an optionee while employed by or providing 
service to the Company or a parent or subsidiary corporation of the Company, 
the option may be exercised at any time prior to the expiration date of the 
option or the expiration of one year after the date of such death, whichever 
is the shorter period, but only if and to the extent the optionee was entitled 
to exercise the option on the date of death, and only by the person or persons 
to whom such optionee's rights under the option shall pass by the optionee's 
will or by the laws of descent and distribution of the state or country of 
domicile at the time of death.  

(iv) The Committee, at the time of grant or at any time thereafter, may extend 
the three-month and one-year expiration periods any length of time not later 
than the original expiration date of the option, and may increase the portion 
of an option that is exercisable, subject to such terms and conditions as the 
Committee may determine.

(v) To the extent that the option of any deceased optionee or of any optionee 
whose employment or service terminates is not exercised within the applicable 
period, all further rights to purchase Shares pursuant to such option shall 
cease and terminate.

(g) Purchase of Shares.  Unless the Committee determines otherwise, Shares may 
be acquired pursuant to an option only upon receipt by the Company of notice 
in writing from the optionee of the optionee's intention to exercise, 
specifying the number of Shares as to which the optionee desires to exercise 
the option and the date on which the optionee desires to complete the 
transaction, and, if required to comply with the Securities Act of 1933, as 
amended, or state securities laws, the notice shall include a representation 
that it is the optionee's present intention to acquire the Shares for 
investment and not with a view to distribution.  The certificates representing 
the Shares shall bear any legends required by the Committee.  Unless the 
Committee determines otherwise, on or before the date specified for completion 
of the purchase of Shares pursuant to an option, the optionee must have paid 
the Company the full purchase price of such Shares in cash (including, with 
the consent of the Committee, cash that may be the proceeds of a loan from the 
Company), or, with the consent of the Committee, in whole or in part, in 
Shares valued at fair market value, as determined pursuant to paragraph 
6(b)(iv).  Unless the Committee determines otherwise, all payments made to the 
Company in connection with the exercise of an option must be made by a 
certified or cashier's bank check or by the transfer of immediately available 
federal funds.  No Shares shall be issued until full payment therefor has been 
made.  With the consent of the Committee, an optionee may request the Company 
to apply automatically the Shares to be received upon the exercise of a 
portion of a stock option (even though stock certificates have not yet been 
issued) to satisfy the purchase price for additional portions of the option.  
Each optionee who has exercised an option shall immediately upon notification 
of the amount due, if any, pay to the Company in cash amounts necessary to 
satisfy any applicable federal, state and local tax withholding requirements.  
If additional withholding is or becomes required beyond any amount deposited 
before delivery of the certificates, the optionee shall pay such amount to the 
Company on demand.  If the optionee fails to pay the amount demanded, the 
Company or any parent or subsidiary corporation of the Company may withhold 
that amount from other amounts payable to the optionee by the Company or the 
parent or subsidiary corporation, including salary, subject to applicable law.  
With the consent of the Committee, an optionee may deliver Shares to the 
Company to satisfy the withholding obligation.  

7. Stock Bonuses.  The Committee may award Shares under the Plan as stock 
bonuses.  Shares awarded as a stock bonus shall be subject to such terms, 
conditions, and restrictions as shall be determined by the Committee, all of 
which shall be evidenced in a writing signed by the recipient prior to 
receiving the bonus Shares.  The Committee may not require the recipient to 
pay any monetary consideration other than amounts necessary to satisfy tax 
withholding requirements.  The certificates representing the Shares awarded 
shall bear any legends required by the Committee.  The Company may require any 
recipient of a stock bonus to pay to the Company in cash upon demand amounts 
necessary to satisfy any applicable federal, state or local tax withholding 
requirements.  If the recipient fails to pay the amount demanded, the Company 
or any parent or subsidiary corporation of the Company may withhold that 
amount from other amounts payable to the recipient by the Company or the 
parent or subsidiary corporation, including salary, subject to applicable law.  
With the consent of the Committee, a recipient may deliver Shares to the 
Company to satisfy the withholding obligation.  

8. Stock Sales.  The Committee may issue Shares under the Plan for such 
consideration (including promissory notes and services) as determined by the 
Committee, provided that in no event shall the consideration be less than 75 
percent of the fair market value of the Shares at the time of issuance, 
determined pursuant to paragraph 6(b)(iv).  Shares issued under this 
paragraph 8 shall be subject to the terms, conditions and restrictions 
determined by the Committee.  The restrictions may include restrictions 
concerning transferability, repurchase by the Company and forfeiture of the 
Shares issued, together with such other restrictions as may be determined by 
the Committee.  The certificates representing the Shares shall bear any 
legends required by the Committee.  The Company may require any purchaser of  
stock issued under this paragraph 8 to pay to the Company in cash upon demand 
amounts necessary to satisfy any applicable federal, state or local tax 
withholding requirements.  If the purchaser fails to pay the amount demanded, 
the Company or any parent or subsidiary corporation of the Company may 
withhold that amount from other amounts payable to the purchaser by the 
Company or any parent or subsidiary corporation, including salary, subject to 
applicable law.  With the consent of the Committee, a purchaser may deliver 
Shares to the Company to satisfy the withholding obligation.  

9. Stock Appreciation Rights.

(a) Grant.  Stock appreciation rights may be granted under the Plan by the 
Committee, subject to such rules, terms, and conditions as the Committee 
prescribes.  

(b) Exercise.

(I) A stock appreciation right shall be exercisable only at the time or times 
established by the Committee.  If a stock appreciation right is granted in 
connection with an option, the stock appreciation right shall be exercisable 
only to the extent and on the same conditions that the related option could be 
exercised.  Upon exercise of a stock appreciation right, any option or portion 
thereof to which the stock appreciation right relates terminates.  If a stock 
appreciation right is granted in connection with an option, upon exercise of 
the option, the stock appreciation right or portion thereof to which the 
option relates terminates.  No stock appreciation right granted to an officer 
or director may be exercised during the first six months following the date of 
grant.  

(ii) The Committee may withdraw any stock appreciation right granted under the 
Plan at any time and may impose any conditions upon the exercise of a stock 
appreciation right or adopt rules and regulations from time to time affecting 
the rights of holders of stock appreciation rights.  Such rules and 
regulations may govern the right to exercise stock appreciation rights granted 
before adoption or amendment of such rules and regulations as well as stock 
appreciation rights granted thereafter.  

(iii) Each stock appreciation right shall entitle the holder, upon exercise, 
to receive from the Company in exchange therefor an amount equal in value to 
the excess of the fair market value on the date of exercise of one Share over 
its fair market value on the date of grant (or, in the case of a stock 
appreciation right granted in connection with an option, the option price per 
Share under the option to which the stock appreciation right relates), 
multiplied by the number of Shares covered by the stock appreciation right or 
the option, or portion thereof, that is surrendered.  No stock appreciation 
right shall be exercisable at a time that the amount determined under this 
subparagraph is negative.  Payment by the Company upon exercise of a stock 
appreciation right may be made in Shares valued at fair market value, in cash, 
or partly in Shares and partly in cash, all as determined by the Committee.  

(iv) For purposes of this paragraph 9, the fair market value of the Shares 
shall be determined pursuant to paragraph 6(b)(iv), on the trading day 
preceding the date the stock appreciation right is exercised.  

(v) No fractional Shares shall be issued upon exercise of a stock appreciation 
right.  In lieu thereof, cash may be paid in an amount equal to the value of 
the fraction or, if the Committee shall determine, the number of Shares may be 
rounded downward to the next whole Share.  

(vi) Each participant who has exercised a stock appreciation right shall, upon 
notification of the amount due, pay to the Company in cash amounts necessary 
to satisfy any applicable federal, state or local tax withholding 
requirements.  If the participant fails to pay the amount demanded, the 
Company or any parent or subsidiary corporation of the Company may withhold 
that amount from other amounts payable to the participant by the Company or 
any parent or subsidiary corporation, including salary, subject to applicable 
law.  With the consent of the Committee, a participant may satisfy this 
obligation, in whole or in part, by having the Company withhold from any 
Shares to be issued upon the exercise that number of Shares that would satisfy 
the withholding amount due or by delivering Shares to the Company to satisfy 
the withholding amount.

(vii) Upon the exercise of a stock appreciation right for Shares, the number 
of Shares reserved for issuance under the Plan shall be reduced by the number 
of Shares issued.  Cash payments of stock appreciation rights shall not reduce 
the number of Shares reserved for issuance under the Plan.  

10. Option Grants to Non-Employee Directors.

(a) Automatic Grants.  Immediately after the close of each annual shareholder 
meeting (commencing with the 1993 annual meeting), each person then serving as 
a Non-Employee Director, including any such person who is elected at such 
meeting, shall automatically be granted a Nonstatutory Stock Option to 
purchase 17,500 Shares.  A "Non-Employee Director" is a director of the 
Company who is not an employee of the Company or of any parent or subsidiary 
corporation of the Company on the date the option is granted.

(b) Terms of Options.  The exercise price for options granted under this 
paragraph 10 shall be the fair market value of the Shares on the date of 
grant, determined pursuant to paragraph 6(b)(iv).  Each such option shall have 
an eight-year term from the date of grant, unless earlier terminated as 
provided in paragraph 6(f), and shall become exercisable with respect to 8,750 
shares six months after the date of grant, with the remaining 8,750 shares 
becoming exercisable on the first anniversary of the date of grant.

11. Changes in Capital Structure. If the outstanding shares of Common Stock of 
the Company are hereafter increased or decreased or changed into or exchanged 
for a different number or kind of shares or other securities of the Company or 
of another corporation by reason of any recapitalization, reclassification, 
stock split, combination of shares or dividend payable in shares, the 
Committee shall make appropriate adjustments (i) in the number and kind of 
shares available for awards under the Plan; and (ii) in the number and kind of 
shares as to which outstanding options and stock appreciation rights, or 
portions thereof then unexercised, shall be exercisable, so that the 
participant's proportionate interest before and after the occurrence of the 
event is maintained, provided that this paragraph 11 shall not apply with 
respect to transactions referred to in paragraph 12.  The Committee may also 
require that any securities issued in respect of or exchanged for Shares 
issued hereunder that are subject to restrictions be subject to similar 
restrictions.  Notwithstanding the foregoing, the Committee shall have no 
obligation to effect any adjustment that would or might result in the issuance 
of fractional shares, and any fractional shares resulting from any adjustment 
may be disregarded or provided for in any manner determined by the Committee.  
Any such adjustment made by the Committee shall be conclusive.  

12. Effect of Reorganization or Liquidation.

(a) Cash, Stock or Other Property for Stock.  Except as provided in 
paragraph 12(b), upon a merger, consolidation, reorganization, plan of 
exchange or liquidation involving the Company, as a result of which the 
shareholders of the Company receive cash, stock or other property in exchange 
for or in connection with their Common Stock (any such transaction to be 
referred to in this paragraph 12 as an "Accelerating Event"), any option or 
stock appreciation right granted hereunder shall terminate, except as 
specified in the following sentence, but the optionee shall have the right 
during a 30-day period immediately prior to any such Accelerating Event to 
exercise his or her option or stock appreciation right, in whole or in part, 
without any limitation on exercisability.  With respect to an option or stock 
appreciation right granted to an officer or director less than six months 
prior to any Accelerating Event, such officer or director shall have the right 
to require the Company to purchase such option or stock appreciation right at 
a purchase price computed pursuant to paragraph 12(c) during the 30-day period 
following the expiration of six months following the date of such grant, and 
this right shall apply even if the option or stock appreciation right has 
otherwise terminated pursuant to paragraph 6(f) following such Accelerating 
Event.

(b) Stock for Stock.  If the shareholders of the Company receive capital stock 
of another corporation ("Exchange Stock") in exchange for their Common Stock 
in any transaction involving a merger, consolidation, reorganization, or plan 
of exchange, all options granted hereunder shall be converted into options to 
purchase shares of Exchange Stock and all stock appreciation rights granted 
hereunder shall be converted into stock appreciation rights measured by the 
Exchange Stock, unless the Committee, in its sole discretion, determines that 
any or all such options or stock appreciation rights granted hereunder shall 
not be converted, but instead shall terminate in accordance with the 
provisions of paragraph 12(a).  The amount and price of converted options and 
stock appreciation rights shall be determined by adjusting the amount and 
price of the options or stock appreciation rights granted hereunder to take 
into account the relative values of the Exchange Stock and the Common Stock in 
the transaction.  

(c) Purchase Price.  With respect to an option granted to an officer or 
director less than six months prior to an Accelerating Event, the purchase 
price payable pursuant to paragraph 12(a) shall be computed as follows:

(i) With respect to a Nonstatutory Stock Option and a stock appreciation right 
as to which no Incentive Stock Option has been granted, the purchase price 
shall be the product of (A) the excess, if any, of the higher of (1) the 
purchase price paid for each Share in the Accelerating Event, or (2) the 
highest fair market value of a Share (determined pursuant to 
paragraph 6(b)(iv)) during the 30-day period ending on the day the 
Accelerating Event occurs, over the option price, and (B) the number of Shares 
covered by the option or stock appreciation right.

(ii) With respect to an Incentive Stock Option and a stock appreciation right 
as to which an Incentive Stock Option has been granted, the purchase price 
shall be the product of (A) the excess, if any, of the fair market value of 
each Share on the date of exercise over the option price, and (B) the number 
of Shares covered by the option or stock appreciation right.  

(iii) No option or stock appreciation right may be exercised in connection 
with an Accelerating Event if the purchase price determined under this 
paragraph 12(c)is negative.  

(d) The rights set forth in this paragraph 12 shall be transferable only to 
the extent the related option or stock appreciation right is transferable.  

13. Corporate Mergers, Acquisitions, Etc.  The Committee may also grant 
options, grant stock appreciation rights, award stock bonuses and sell  stock 
under the Plan having terms, conditions and provisions that vary from those 
specified in the Plan; provided that any such awards are granted in 
substitution for, or in connection with the assumption of, existing options, 
stock appreciation rights, stock bonuses and stock sold or awarded by another 
corporation and assumed or otherwise agreed to be provided for by the Company 
pursuant to or by reason of a transaction involving a corporate merger, 
consolidation, acquisition of property or stock, separation, reorganization or 
liquidation to which the Company or a parent or subsidiary corporation of the 
Company is a party.

14. Amendment of Plan.  

(a) The Board may at any time, and from time to time, modify or amend the Plan 
in such respects as it shall deem advisable because of changes in the law 
while the Plan is in effect or for any other reason.  Except as provided in 
paragraphs 6(b)(v), 11, 12 and 13, however, no change in an award already 
granted shall be made without the written consent of the holder of such award.  

(b) Notwithstanding any other provision in the Plan, paragraph 10 may be 
amended or modified by the Board or the shareholders of the Company only once 
in any six-month period, except as may be required to comport with changes in 
the Code, or the Employee Retirement Income Security Act, or the rules 
promulgated thereunder.  

15. Approvals.  The obligations of the Company under the Plan are subject to 
the approval of state and federal authorities or agencies with jurisdiction in 
the matter.  The Company shall not be obligated to issue or deliver Shares 
under the Plan if such issuance or delivery would violate applicable state or 
federal securities laws, or if compliance with such laws would, in the opinion 
of the Company, be unduly burdensome or require the disclosure of information 
which would not be in the Company's best interests.

16. Employment and Service Rights.  Nothing in the Plan or any award pursuant 
to the Plan shall (i) confer upon any employee any right to be continued in 
the employment of the Company or any parent or subsidiary corporation of the 
Company or shall interfere in any way with the right of the Company or any 
parent or subsidiary corporation of the Company by whom such employee is 
employed to terminate such employee's employment at any time, for any reason, 
with or without cause, or to increase or decrease such employee's compensation 
or benefits; or (ii) confer upon any person engaged by the Company or any 
parent or subsidiary corporation of the Company any right to be retained or 
employed by the Company or the parent or subsidiary or to the continuation, 
extension, renewal, or modification of any compensation, contract, or 
arrangement with or by the Company or the parent or subsidiary.

17. Rights as a Shareholder.  The recipient of any award under the Plan shall 
have no rights as a shareholder with respect to any Shares until the date of 
issue to the recipient of a stock certificate for such Shares.  Except as 
otherwise expressly provided in the Plan, no adjustment shall be made for 
dividends or other rights for which the record date is prior to the date such 
stock certificate is issued.