CAPSTONE PHARMACY SERVICES ANNOUNCES THIRD QUARTER & NINE MONTH RESULTS; Sales Increase 54.6% -- Substantial Turn-Around.

BALTIMORE, Md.--(HealthWire)--January 16, 1996--Capstone Pharmacy Services, Inc. (Nasdaq National Market: DOSE (common stock), DOSEW (warrants) ("Capstone") today announced results for the third quarter and nine month periods ended November 30, 1995 (see attached table).

Net sales for the three months ended November 30, 1995 increased 54.6% to $16,422,000 from $10,621,000 in the prior year period. Net income for the period increased to $294,000, or $0.02 per share, from a net loss of $2,851,000, or $0.47 per share, for the same period last year.

Net sales for the nine months ended November 30, 1995 increased 31.9% to $43,381,000 from $32,897,000 for the same period last year. The net income for the nine month period was $148,000, or $0.01 per share, compared to a net loss of $6,911,000, or $1.13 per share, for the same period last year.

Dirk Allison, President and CEO, said, "This is the first time that we have posted positive operating income in a number of quarters. Our program to improve operations is progressing most satisfactorily and sales in both our long term care and correctional pharmacy divisions are increasing dramatically."

Morris Perlis, Vice Chairman, said, "In 1996, we plan to accelerate Capstone's acquisition program in the long-term care market. Recently, we completed the acquisition of Geri-Care Systems, Inc. in New York City. It will add over $7 million in annual revenues."

"On the correctional facilities side, we have added a number of states including the provision of services to 10,500 inmates in the state of Massachusetts. We now provide pharmacy services to over 120,000 inmates in more than 120 prisons."

Capstone Pharmacy Services, Inc. is a leading provider of extended care institutional pharmacy services to nursing homes, correctional facilities and HMOs. Capstone services accounts throughout the United States. -0-

                        CAPSTONE PHARMACY SERVICES
               CONSOLIDATED CONDENSED STATEMENTS OF EARNINGS
                                (Unaudited)

                        Three Months Ended          Nine Months Ended
                      11/30/95       11/30/94     11/30/95     11/30/94

Net sales           $16,421,664   $10,621,124   $43,381,334   $32,896,879
Cost of sales       $10,126,783    $7,445,836   $27,185,754   $21,446,014
   Gross profit       6,294,881     3,175,288    16,195,580    11,450,865
Operating expenses:
   Selling and
    administrative
    expenses          6,770,667     4,835,588    15,706,036    12,923,919
   Depreciation         231,952       137,170       603,610       410,172
   Amortization of
    intangibles         120,116        92,827       368,822       278,482
  Costs in connection
    with claims and
    litigation                0       971,638             0     4,389,163
   Total operating
     expenses         6,122,735     6,037,223    16,678,468    18,001,736
   Operating income
     (loss) from
     continuing
     operation before
     income taxes,
     discontinued
     operations and
     extraordinary
     item               172,146    (2,861,935)     (482,888)   (6,550,871)
Non-operating expense
 (income):
  Interest expense, net  71,348       229,675       616,207       695,214
Other income            (11,038)     (139,315)     (304,322)     (191,718)
  Total non-operating
   expense, net          60,310        90,360       311,885       503,496
  Income (loss) from
   continuing
   operations
   before income
   taxes, discontinued
   operations and
   extraordinary item   111,836    (2,952,295)     (794,773)   (7,054,367)
Income tax benefit     (182,205)      (15,180)     (181,905)      (22,119)
  Income (loss) from
   continuing operations
   before discontinued
   operations and
   extraordinary item   294,041    (2,937,115)     (612,868)   (7,032,248)
Discontinued Operations:
Gain on sale of assets
  of discontinued
  business segments, net      0             0       477,840             0
Income from operations of
  discontinued business
  segments, net               0        86,000             0       121,208
Net income (loss)
 before extraordinary
 item                   294,041    (2,851,115)     (135,028)   (6,911,040)
Extraordinary item:
 Discount on repayment
  of vendor debt              0             0       283,364             0
   Net income (loss)   $294,041   $(2,851,115)     $148,336   $(6,911,040)

Earnings per share data:
Primary:
   Continuing operations  $0.02        $(0.48)       $(0.06)       $(1.15)
   Discontinued
    operations             0.00          0.01          0.04          0.02
   Extraordinary item      0.00          0.00          0.03          0.00
     Net income (loss)    $0.02        $(0.47)        $0.01        $(1.13)
Fully Diluted:
   Continuing operations  $0.02        $(0.48)       $(0.05)       $(1.15)
   Discontinued operations 0.00          0.01          0.04          0.02
   Extraordinary item      0.00          0.00          0.02          0.00
     Net income (loss)    $0.02        $(0.47)        $0.01        $(1.13)

Weighted average number
 of shares outstanding:
Primary              14,237,976     6,091,206    10,859,759     6,091,206
Fully Diluted        14,270,630     6,091,206    11,219,356     6,091,206

The accompanying notes are an integral part of these financial statements.

CONTACT: Capstone Pharmacy Services

Dirk Allison

President and CEO

[phone]

or

Counsel Corporation

Ivan Shaffer 

Senior Vice President

[phone]

or

Lippert/Heilshorn

Julie Vicelja

[phone]