<SUBMISSION>
<ACCESSION-NUMBER>0000950148-00-001664
<TYPE>10-Q
<PUBLIC-DOCUMENT-COUNT>3
<PERIOD>20000630
<FILING-DATE>20000810
<FILER>
<COMPANY-DATA>
<CONFORMED-NAME>ACCUMED INTERNATIONAL INC
<CIK>0000888335
<ASSIGNED-SIC>2835
<IRS-NUMBER>364054899
<STATE-OF-INCORPORATION>DE
<FISCAL-YEAR-END>1231
</COMPANY-DATA>
<FILING-VALUES>
<FORM-TYPE>10-Q
<ACT>34
<FILE-NUMBER>000-20652
<FILM-NUMBER>690929
</FILING-VALUES>
<BUSINESS-ADDRESS>
<STREET1>900 N FRANKLIN ST
<STREET2>STE 401
<CITY>CHICAGO
<STATE>IL
<ZIP>60610
<PHONE>3126429200
</BUSINESS-ADDRESS>
<MAIL-ADDRESS>
<STREET1>920 N FRANKLIN STREET
<STREET2>SUITE 402
<CITY>CHICAGO
<STATE>IL
<ZIP>60610
</MAIL-ADDRESS>
<FORMER-COMPANY>
<FORMER-CONFORMED-NAME>ALAMAR BIOSCIENCES INC
<DATE-CHANGED>19950504
</FORMER-COMPANY>
</FILER>
<DOCUMENT>
<TYPE>10-Q
<SEQUENCE>1
<FILENAME>e10-q.txt
<DESCRIPTION>FORM 10-Q (6/30/00)
<TEXT>

<PAGE>   1

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549


                                    FORM 10-Q


[X]   Quarterly report pursuant to Section 13 or 15(d) of the Securities
      Exchange Act of 1934

                  For the quarterly period ended June 30, 2000.

                                       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 number: 0-20652


                            ACCUMED INTERNATIONAL, INC.
              -----------------------------------------------------
             (Exact name of registrant as specified in its charter)


            Delaware                                        36-4054899
-------------------------------                         ----------------
  (State or other jurisdiction                            (IRS Employer
of incorporation or organization)                      Identification No.)


                920 N. Franklin St., Suite 402, Chicago, IL 60610
                -------------------------------------------------
                    (Address of principal executive offices)


                                 (312) 642-9200
                             ---------------------
               (Registrant's telephone number including area code)


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 [ ]

     The registrant had 5,696,542 shares of common stock outstanding as of
August 7, 2000.


<PAGE>   2



                   ACCUMED INTERNATIONAL, INC. AND SUBSIDIARY

                                      INDEX
<TABLE>
<CAPTION>
                                                                                                     Page
                                                                                                    Number
                                                                                                    ------
<S>                                                                                                 <C>
  PART I.      FINANCIAL INFORMATION

  Item 1.      Condensed Consolidated Financial Statements

               Condensed Consolidated Balance Sheets
                    as of June 30, 2000 and December 31, 1999.......................................   1

               Condensed Consolidated Statements of Operations
                    for the Three Months Ended June 30, 2000 and 1999
                    and for the Six Months Ended June 30, 2000 and 1999 ............................   2

               Condensed Consolidated Statements of Cash Flows
                    for the Six Months Ended June 30, 2000 and 1999.................................   3

               Notes to Condensed Consolidated Financial Statements.................................   4

  Item 2.      Management's Discussion and Analysis of Financial
                    Condition and Results of Operations.............................................   7

  Item 3.      Quantitative and Qualitative Disclosures About Market Risk...........................  11

PART II.OTHER INFORMATION

  Item 4       Submission of Matters to a Vote of Security Holders..................................  13
  Item 6.      Exhibits and Reports on Form 8-K.....................................................  13

SIGNATURES .........................................................................................  14

</TABLE>


<PAGE>   3

                         PART I - FINANCIAL INFORMATION
                   ACCUMED INTERNATIONAL, INC. AND SUBSIDIARY
                      CONDENSED CONSOLIDATED BALANCE SHEETS



<TABLE>
<CAPTION>
                                                         Unaudited
                                               ----------------------------------
            ASSETS                             June 30, 2000    December 31, 1999
                                               -------------    -----------------
<S>                                            <C>              <C>
Current Assets
Cash and cash equivalents                      $    656,234       $    196,303
Prepaid expenses and other current assets            40,319              7,944
Available-for-sale security                         237,412            121,301
Note receivable                                        --              400,000
Inventories                                         691,706            700,919
                                               ------------       ------------
Total current assets                              1,625,671          1,426,467
                                               ------------       ------------

Fixed assets, net                                   561,442            705,273

Purchased technology, net                         3,854,868          4,185,868
Patents, net                                        815,091            842,484
Note receivable, officer                             41,712             62,237
                                               ------------       ------------

                                               $  6,898,784       $  7,222,329
                                               ============       ============

          LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities
Long term debt, current portion                $    237,550       $    362,550
Accounts payable                                    220,664            223,822
Accrued interest                                     17,729             15,415
Income taxes                                         35,000             35,000
Deferred revenues                                   550,008               --
Other current liabilities                           553,457            750,183
                                               ------------       ------------
Total current liabilities                         1,614,408          1,386,970
                                               ------------       ------------

Long term debt                                      167,000            167,000
Deferred revenues                                 1,040,149               --

Stockholders' equity
Preferred stock, Series A convertible             2,868,419          4,249,735
Common stock, $0.01 par value                        56,966             54,919
Additional paid-in capital                       60,998,531         59,619,262
Accumulated other comprehensive income              115,181             (4,960)
Accumulated deficit                             (59,745,133)       (58,033,860)
Treasury stock                                     (216,737)          (216,737)
                                               ------------       ------------
Total stockholders' equity                        4,077,227          5,668,359
                                               ------------       ------------

                                               $  6,898,784       $  7,222,329
                                               ============       ============
</TABLE>

          See accompanying notes to consolidated financial statements.


                                      -1-
<PAGE>   4


                   ACCUMED INTERNATIONAL, INC. AND SUBSIDIARY
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (Unaudited)

<TABLE>
<CAPTION>

                                                               THREE MONTHS ENDED JUNE 30,      SIX MONTHS ENDED JUNE 30,
                                                               ---------------------------     ---------------------------
                                                                  2000             1999           2000            1999
                                                               ------------    -----------     -----------     -----------
<S>                                                            <C>             <C>             <C>             <C>
Net sales                                                      $    13,500            --       $   168,463     $    11,435
Licensing fees                                                      48,984            --            48,984            --
Royalties                                                           21,644            --            21,644            --
                                                               -----------     -----------     -----------     -----------
        Total net revenues                                          84,128            --           239,091          11,435
                                                               -----------     -----------     -----------     -----------
Operating expenses:
        Cost of sales                                                6,149            --            49,830           3,413
        General and administrative                                 781,513         593,928       1,569,681       1,615,585
        Research and development                                   230,512         514,105         582,880         969,144
        Sales and marketing                                         15,555          73,920          88,144         145,148
                                                               -----------     -----------     -----------     -----------
           Total operating expenses                              1,033,729       1,181,953       2,290,535       2,733,290
                                                               -----------     -----------     -----------     -----------
Operating loss                                                    (949,601)     (1,181,953)     (2,051,444)     (2,721,855)
                                                               -----------     -----------     -----------     -----------
Other income (expense):
        Interest expense                                            (7,500)         (7,668)        (15,000)       (477,694)
        Realized gain on available-for-sale security                  --              --           326,844            --
        Other income (expense), net                                 12,992          69,429          28,327           2,667
                                                               -----------     -----------     -----------     -----------
           Total other income (expense)                              5,492          61,761         340,171        (475,027)
                                                               -----------     -----------     -----------     -----------
Loss from continuing operations                                   (944,109)     (1,120,192)     (1,711,273)     (3,196,882)
                                                               -----------     -----------     -----------     -----------
Discontinued operations:
    Loss from discontinued operations                                 --              --              --          (158,250)
    Gain on disposal                                                  --              --              --         8,357,449
                                                               -----------     -----------     -----------     -----------
Income from discontinued operations                                   --              --              --         8,199,199
                                                               -----------     -----------     -----------     -----------
           Net (loss) income                                   $  (944,109)    $(1,120,192)    $(1,711,273)    $ 5,002,317
                                                               ===========     ===========     ===========     ===========

Basic and diluted loss per share from continuing operations    $     (0.17)    $     (0.20)    $     (0.31)    $     (0.58)

Income per share from discontinued operations                         --              --              --              1.49
                                                               -----------     -----------     -----------     -----------

Basic and diluted net (loss) income per share                  $     (0.17)    $     (0.20)    $     (0.31)    $      0.91
                                                               ===========     ===========     ===========     ===========

Weighted average common shares outstanding                       5,663,657       5,491,901       5,600,360       5,489,878
                                                               ===========     ===========     ===========     ===========
</TABLE>



           See accompanying notes to consolidated financial statements


                                      -2-
<PAGE>   5

                   ACCUMED INTERNATIONAL, INC. AND SUBSIDIARY
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

                        FOR THE SIX MONTHS ENDED JUNE 30,

<TABLE>
<CAPTION>

                                                                                     UNAUDITED
                                                                           -----------------------------
                                                                               2000            1999
                                                                           -------------    ------------
<S>                                                                        <C>              <C>
OPERATING ACTIVITIES:

         Net (loss) income                                                 $ (1,711,273)    $  5,002,317
         Adjustments to reconcile net (loss) income to net cash
         used in operating activities:
            Income from discontinued operations                                    --         (8,199,199)
            Non-cash expenses of asset disposal                                    --            492,500
            Depreciation and amortization                                       529,978          452,244
            Increase in deferred revenues                                     1,590,157             --
            Changes in other operating assets and liabilities                  (527,051)        (553,306)
                                                                           ------------     ------------
CASH USED IN OPERATING ACTIVITIES                                              (118,189)      (2,805,444)
                                                                           ------------     ------------

INVESTING ACTIVITIES:

         Proceeds from note receivable                                          400,000             --
         Proceeds from sale of available-for-sale security                      326,844             --
         Capital expenditures                                                   (27,755)            --
         Proceeds from sale of Microbiology division                               --         15,150,000
         Expenses related to sale of Microbiology division                         --           (750,000)
                                                                           ------------     ------------
CASH PROVIDED BY INVESTING ACTIVITIES                                           699,089       14,400,000
                                                                           ------------     ------------

FINANCING ACTIVITIES:

         Payment of notes payable                                              (125,000)      (8,497,551)
                                                                           ------------     ------------
CASH USED IN FINANCING ACTIVITIES                                              (125,000)      (8,497,551)
                                                                           ------------     ------------
CASH TRANSFER TO DISCONTINUED OPERATIONS                                           --           (313,979)
                                                                           ------------     ------------
EFFECT OF EXCHANGE RATES ON CASH                                                  4,031             --
                                                                           ------------     ------------
NET INCREASE IN CASH AND CASH EQUIVALENTS                                       459,931        2,783,026
                                                                           ------------     ------------
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD                                196,303          213,386
                                                                           ------------     ------------
CASH AND CASH EQUIVALENTS AT END OF PERIOD                                 $    656,234     $  2,996,412
                                                                           ============     ============

</TABLE>


          See accompanying notes to consolidated financial statements.


                                      -3-
<PAGE>   6


                   ACCUMED INTERNATIONAL, INC. AND SUBSIDIARY

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1.   PREPARATION OF INTERIM FINANCIAL STATEMENTS

     In the opinion of the management of AccuMed International, Inc. and its
wholly-owned subsidiary, the accompanying unaudited condensed consolidated
financial statements include all normal adjustments considered necessary to
present fairly AccuMed's financial position as of June 30, 2000, and its results
of operations for the three-month and six-month periods ended June 30, 2000 and
1999 and cash flows for the six-month periods ended June 30, 2000 and 1999.
Interim results are not necessarily indicative of results for a full year.

     The condensed consolidated financial statements and notes are presented as
permitted by Form 10-Q, and do not contain certain information included in
AccuMed's audited consolidated financial statements and notes there to for the
fiscal year ended December 31, 1999 as filed with the Securities and Exchange
Commission on Form 10-K.

2.   BASIS OF PRESENTATION

     The condensed consolidated financial statements include the accounts of
AccuMed and its wholly-owned subsidiary. All significant intercompany balances,
transactions and stockholdings have been eliminated.

     On December 22, 1998, (the measurement date), AccuMed received shareholder
approval to sell its microbiology division under a sales agreement negotiated by
management under the approval of the Board of Directors. On January 29, 1999,
AccuMed closed the sale of the microbiology division for proceeds of $15,150,000
in cash. AccuMed recognized a gain of $8,357,000, net of income taxes of
$140,000 and after working capital adjustments, on the disposal of the
microbiology division. Accordingly, the microbiology division is accounted for
as a discontinued operation in the accompanying condensed consolidated balance
sheets, statements of operations and statements of cash flows.



                                      -4-
<PAGE>   7



3.   OTHER COMPREHENSIVE INCOME (LOSS)

<TABLE>
<CAPTION>

                                                      Three Months Ended                 Six Months Ended
                                                           June 30,                          June 30,
                                               ----------------------------    ---------------------------
                                                   2000             1999           2000           1999
                                               ------------    ------------    ------------    -----------
<S>                                            <C>             <C>             <C>             <C>
Net (loss) income                              $  (944,109)    $(1,120,192)    $(1,711,273)    $ 5,002,317
Other comprehensive income (loss)
  Reclassification of realized gain
     included in net income                           --              --          (326,844)           --
  Change fair value of available-for-sale
     security                                      (28,565)           --           442,955            --
   Foreign currency translation adjustments
                                                     4,738         (31,046)          4,031         (84,748)
                                               -----------     -----------     -----------     -----------
Comprehensive (loss) income                    $  (967,936)    $(1,151,238)    $(1,591,131)    $ 4,917,569
                                               ===========     ===========     ===========     ===========
</TABLE>


4.   INVENTORIES

     Inventories are summarized as follows:

<TABLE>
<CAPTION>

                                             June 30,          December 31,
                                               2000                1999
                                             --------            --------
<S>                                          <C>                 <C>
Raw material and packaging                   $570,536            $529,919
Work in process                                  --                  --
Finished goods                                121,170             171,000
                                             --------            --------
Total inventories                            $691,706            $700,919
                                             ========            ========

</TABLE>

5.   SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION

<TABLE>
<CAPTION>

                                                            Six Months Ended June 30,
                                                            --------------------------
                                                               2000            1999
                                                            -----------   -------------
<S>                                                         <C>           <C>
OPERATING ACTIVITIES:

    Interest paid                                           $   12,686    $  295,170

NON-CASH INVESTING AND FINANCING ACTIVITIES:

    Preferred stock converted to common stock               $1,381,316    $   79,731
</TABLE>


6.   SALE OF AVAILABLE-FOR-SALE SECURITY

     In February 2000, AccuMed sold 85,776 of the shares it holds in Ampersand
Medical Corporation on the open market for proceeds of $326,844. AccuMed
recorded a realized gain on the sale of these shares of $326,844 for the six
months ended June 30, 2000.



                                      -5-
<PAGE>   8



7.   NOTE RECEIVABLE

     On March 31, 2000, AccuMed received $417,747, including interest, in full
satisfaction of the amounts advanced to Microsulis Corporation (Microsulis)
under a line of credit. AccuMed has no obligation to make further advances to
Microsulis.

8.   LICENSE AGREEMENTS

     On March 24, 2000, AccuMed entered into a license and development agreement
with Ventana Medical Systems, Inc. (Ventana), whereby AccuMed agreed to license
its patents and proprietary information and rights to Ventana for certain
medical applications. Under the terms of the agreement, AccuMed has received and
deferred an up-front licensing fee, advance royalty payment, and development
funds. Additional development funds will be received over the next nine months
for contract research. The agreement also provides for the sale of AcCell(TM)
Systems to Ventana and royalties to be received in the future on the sale of
covered products by Ventana. The deferred up-front licensing fee is being
recognized as revenue systematically over the 36-month term of the agreement.
The advance royalty payment will be recognized as revenue during the period that
the royalties are earned on the sale of covered products. AccuMed is required
under the agreement to complete certain development obligations. Qualifying
development costs incurred during the development process will be charged
against the deferred development funds received. The excess amount of
development funds, if any, over the amount of qualifying costs incurred will be
recognized in income upon the completion of the development process. AccuMed
does not anticipate that any excess development funds will be material.

     On March 29, 2000, the Company entered into a patent and technology license
agreement with BCAM International, Inc., renamed CellMetrix, Inc. (CellMetrix),
whereby AccuMed agreed to license its patents and proprietary information and
rights to CellMetrix for certain medical applications. Under the terms of the
agreement, AccuMed received a guaranteed license fee upon signing of the
agreement. Over the next nine months AccuMed will receive additional guaranteed
license fees, shares of CellMetrix common stock, and an advance royalty payment
in the form of cash or shares of CellMetrix common stock. Royalties are to be
received in the future on the sale of covered products by CellMetrix. AccuMed
has deferred the amount of the license fee it received. This fee is being
recognized as revenue systematically over the 60-month term of the agreement.

     On March 29, 2000, AccuMed entered into a letter agreement to reinstate and
amend its September 4, 1998 patent and technology license agreement with
Ampersand. Upon signing of the letter agreement, AccuMed received an up-front
license fee. On June 9, 2000, AccuMed signed a formal amendment to the agreement
and received an advance royalty in the form of cash. AccuMed will also receive a
$100,000 convertible note and 128,571 shares of Ampersand common stock as an
additional advance royalty. AccuMed has deferred the amount of the up-front
license fee it received. This fee is being recognized as revenue systematically
over the remaining 41-month term of the agreement. The advance royalties are
being recognized as revenue during the period that the royalties are earned on
the sale of covered products.


                                      -6-
<PAGE>   9

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS

GENERAL

     AccuMed is engaged in marketing and developing cost effective screening
instruments and systems for clinical diagnostic laboratories, hospitals and
others. AccuMed's integrated systems use reliable, accurate and innovative
products and methods to provide laboratories with comprehensive solutions that
are intended to improve efficiency and reduce costs while achieving significant
improvements in disease detection. AccuMed currently is developing cytology
computer-aided image cytometry instruments and systems that support early
detection and diagnosis programs for screening high-risk individuals for
cellular diseases, such as lung cancer.

     During 1998, AccuMed received shareholder approval to sell its microbiology
business. Accordingly, the results of the microbiology business are reported as
a discontinued operation in the accompanying condensed consolidated financial
statements. On January 29, 1999, AccuMed closed the sale of the microbiology
business for net proceeds of $14,400,000.

     The following management discussion and analysis of financial condition and
results of operations relate only to the cytopathology business, AccuMed's only
business line. Also, AccuMed is committed to a substantial research and
development program. Accordingly, AccuMed expects to incur additional operating
losses over at least the next twelve months due to continued spending for
product development, prototype construction and testing and regulatory
activities.

OVERVIEW

     On March 24, 2000, AccuMed entered into a license and development agreement
with Ventana Medical Systems, Inc. (Ventana), whereby AccuMed agreed to license
its patents and proprietary information and rights to Ventana for certain
medical applications. Under the terms of the agreement, AccuMed received an
up-front licensing fee, advance royalty payment, and development funds.
Additional funds will be received over the next nine months for contract
research. The agreement also provides for the sale of AcCell(TM) Systems to
Ventana and royalties to be received in the future on the sale of covered
products by Ventana.

     On March 29, 2000, the Company entered into a patent and technology license
agreement with BCAM International, Inc., renamed CellMetrix, Inc. (CellMetrix),
whereby AccuMed agreed to license its patents and proprietary information and
rights to CellMetrix for certain medical applications. Under the terms of the
agreement, AccuMed received a guaranteed license fee upon signing of the
agreement. Over the next nine months, AccuMed will receive additional guaranteed
license fees, shares of CellMetrix common stock and advance royalties in the
form of cash or shares of CellMetrix common stock. Royalties are to be received
in the future on the sale of covered products by CellMetrix.

                                      -7-
<PAGE>   10


      On March 29, 2000, AccuMed entered into a letter agreement to reinstate
and amend its September 4, 1998 patent and technology license agreement with
Ampersand Medical Corporation (Ampersand). The Company received an up-front
license fee upon signing the letter agreement. On June 9, 2000, AccuMed signed a
formal amendment to the agreement and received an advance royalty in the form of
cash. AccuMed will also receive a convertible note and shares of Ampersand
common stock as an additional advance royalty.

RESULTS OF OPERATIONS

THREE MONTHS ENDED JUNE 30, 2000 COMPARED TO THREE MONTHS ENDED JUNE 30, 1999

     REVENUES AND COST OF SALES

     AccuMed's net revenues were $84,000 for the three months ended June 30,
2000 compared to zero for the three months ended June 30, 1999. Net revenues for
the 2000 period reflect the sale of one AcCell(TM) unit and licensing fees and
royalties earned on our license agreements with Ampersand, CellMetrix, and
Ventana, which were signed late in the 2000 1st quarter. There were no units of
product sold or any licensing fees or royalties earned during the 1999 period.
Cost of sales represents the cost of products sold. We anticipate our future
product sales will be made on a build to order or contract manufacturing basis.

     OPERATING EXPENSES

     General and administrative expenses increased by $188,000, or 31.6%, from
$594,000 in the 1999 period to $781,000 in the 2000 period. The 2000 period
includes a payment to settle certain benefits owed to the Company's previous
chief executive officer that resulted from the amended patent and technology
license agreement with Ampersand. The 1999 period also includes the favorable
effect of the settlement of certain litigation for less than previously
estimated. The increase in expenses is offset to a certain degree by cost
savings resulting from the consolidation of our operations.

     Research and development expenses decreased by $284,000, or 55.2%, from
$514,000 in 1999 to $231,000 in 2000. The decrease in these expenses is a result
of the application of qualifying costs under our development obligation with
Ventana to development funds received and benefits achieved from the
consolidation of our research and development activities along with the
consolidation of our operations. Current research and development expenses
represent ongoing efforts to develop the Savant(TM) medical technologies' next
generation products.

     Sales and marketing expenses decreased to $16,000 for the three months
ended June 30, 2000 compared to $74,000 for the 1999 period. The decrease is
primarily a result of personnel reductions and a decrease in travel costs.
AccuMed continues to market its products on a limited basis in certain
laboratory market segments. AccuMed anticipates that its third party licensees
will assume a large portion of the marketing effort.



                                      -8-
<PAGE>   11


SIX MONTHS ENDED JUNE 30, 2000 COMPARED TO SIX MONTHS ENDED JUNE 30, 1999

     REVENUES AND COST OF SALES

     AccuMed's net revenues were $239,000 for the six months ended June 30, 2000
compared to $11,000 for the six months ended June 30, 1999. Net revenues for the
2000 period reflect the sale of AcCell(TM) and AcCell-Savant(TM) units and
licensing fees and royalties earned on our license agreements with Ampersand,
CellMetrix, and Ventana, which were signed in 2000. Net revenues for the 1999
period represent sales of consumables and computer support equipment. Cost of
sales represents the cost of products sold.

     OPERATING EXPENSES

     General and administrative expenses decreased by $46,000, or 2.8%, from
$1,616,000 in the 1999 period to $1,570,000 in the 2000 period. The decrease in
these expenses is a result of reduced corporate level activity due to the sale
of the microbiology business, and less administrative cost following the
consolidation of AccuMed's operations.

     Research and development expenses decreased by $386,000, or 39.9%, from
$969,000 in 1999 to $583,000 in 2000. The decrease in these expenses is a result
of the application of qualifying costs under our development obligation with
Ventana to development funds received and benefits achieved from the
consolidation of our research and development activities along with the
consolidation of our operations.

     Sales and marketing expenses were $88,000 for the six months ended June 30,
2000 compared to $145,000 for the 1999 period. The decrease in these expenses is
primarily a result of personnel reductions and reduced spending on consultants.

     Interest expense for the period ended June 30, 2000 was $15,000 compared to
$478,000 for the 1999 period. The decline in interest expense is a result of the
repayment in January 1999 of AccuMed's 14.5% secured note payable and 12.0%
unsecured convertible notes with proceeds from our sale of the microbiology
division. Interest expense for the 1999 period also includes $370,000 from a
non-cash write-off of deferred financing costs and debt discounts related to the
repayment of these notes.

     DISCONTINUED OPERATIONS

     AccuMed's loss of $158,000 in 1999 from discontinued operations reflects
the results of operations of AccuMed's microbiology business before its sale in
January 1999. In 1999, we recorded a gain of $8,357,000, net of income taxes of
$140,000, on the disposal of the microbiology business.



                                      -9-
<PAGE>   12


LIQUIDITY AND CAPITAL RESOURCES

     AccuMed's primary cash requirements are for research and development,
general corporate and marketing expenses, including salaries, materials and
consulting support, to develop and market AccuMed's cytopathology products and
technology. We anticipate that the receipt of funds under our agreements with
Ventana, CellMetrix, and Ampersand, our available cash, and our marketable
securities on hand will provide the necessary liquidity to finance AccuMed's
projected operations and financing obligations through the next twelve months.

     At June 30, 2000, AccuMed has long-term debt, including the current
portion, of $405,000. The long-term debt consists of a $322,000 Canadian dollar
note and a non-interest bearing repayable contribution of $187,000 (U.S.
dollars). The Canadian dollar note is payable in monthly installments of $25,000
U.S. dollars, plus interest at a rate of 6.0% over the Canadian prime rate
through July 15, 2000, with the remainder due on demand, or in the event not
called, the principal payments will continue at a rate of $25,000 U.S. dollars
per month, plus interest. The demand portion of the Canadian note is convertible
into shares of AccuMed's common stock at a price of $1.43 per share. The
repayable contribution was received under a Canadian government program and
calls for semi-annual installments based on future sales of product and
available funds, as defined.

OPERATING ACTIVITIES

     For the six months ended June 30, 2000 and 1999, AccuMed used $118,000 and
$2,805,000, respectively, of cash in operations. The decrease in the use of cash
in operations in 2000 compared to 1999 is primarily a result of a decrease in
operating expenses of $443,000, the receipt of $1,850,000 under AccuMed's
agreements with Ventana, CellMetrix, and Ampersand, and other working capital
changes.

INVESTING ACTIVITIES

     Investing activities generated $699,000 in cash for the six months ended
June 30, 2000 compared to $14,400,000 provided by investing activities for the
1999 period. In 2000, AccuMed received $327,000 from the sale of shares it held
in Ampersand and collected $400,000 from the repayment by Microsulis of loans
made by AccuMed under outstanding notes receivable. In 1999, AccuMed received
$14,400,000 in proceeds, net of expenses incurred, from the sale of AccuMed's
microbiology business. To date in 2000, we have spent $28,000 on capital
expenditures. We do not anticipate material capital expenditures during the
remainder of 2000.

FINANCING ACTIVITIES

     AccuMed used $125,000 of cash in financing activities during the six months
ended June 30, 2000 compared to the use of $8,498,000 in cash during the 1999
period. Cash used in 2000 was for repayment of AccuMed's Canadian dollar note
payable. In 1999, we repaid all of our outstanding 14.5% secured notes and 12%
unsecured convertible notes with proceeds from the sale of AccuMed's
microbiology division.


                                      -10-
<PAGE>   13

     AccuMed currently has no commitments with respect to sources of additional
financing other than with respect to funds to be received under our agreements
with Ventana, CellMetrix, and Ampersand.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

     AccuMed holds shares of common stock of Ampersand Medical Corporation, a
publicly traded company. As a result, AccuMed's financial results could be
significantly affected by changes in the traded market price of this security.
AccuMed also has debt instruments that are denominated in Canadian dollars. The
interest rate for one of these debt instruments varies based on changes in the
Canadian prime rate of interest. As a result, AccuMed's financial results could
be significantly affected by changes in the exchange rate for Canadian dollars
and to changes in the Canadian prime rate of interest. Management does not
actively employ strategies to minimize AccuMed's risks to these exposures.

     The following table presents information about the shares AccuMed holds in
Ampersand as of June 30, 2000.
<TABLE>
<CAPTION>

                                                           SHARES                     FAIR
                                                            HELD                      VALUE
                                                           ------                   --------
<S>                                                        <C>                      <C>
     Ampersand Medical Corporation                         65,493                   $237,412
</TABLE>

     The following tables present information about AccuMed's debt instruments
that are subject to foreign currency and interest rate risk. The table presents
principal cash flows, related weighted-average interest rate by expected
maturity, and the applicable average Canadian to U.S. dollar exchange rate.

<TABLE>
<CAPTION>

                                                                                               FAIR
                                          2000              2001              TOTAL            VALUE
                                          ----              ----              -----            -----
<S>                                      <C>              <C>               <C>              <C>
     Foreign currency risk:
       Principal                         $237,550         $167,000          $404,550         $404,550
       Average interest rate                12.4%               0%
       Exchange rate                       1.4780           1.4780
</TABLE>


                                      -11-
<PAGE>   14

<TABLE>
<CAPTION>

                                                                                               FAIR
                                          2000              2001              TOTAL            VALUE
                                          ----              ----              -----            -----
<S>                                      <C>              <C>               <C>              <C>
     Interest rate risk:
       Principal                         $217,550         $   -             $217,550         $217,550
       Average interest rate                13.5%

</TABLE>


                           FORWARD-LOOKING STATEMENTS

     This report contains forward-looking statements that are based on our
current expectations, assumptions, estimates and projections about us and our
industry. When used in this Report, the words "may," "will," "expects,"
"anticipates," "believe," "estimates," "intends" and similar expressions are
intended to identify forward-looking statements. These statements describe our
beliefs concerning the future based on currently available information. Our
actual results could differ materially from those contained in the
forward-looking statements due to a number of risks and uncertainties. We assume
no obligation to publicly update or revise these forward-looking statements for
any reason, or to update the reasons actual results could differ materially from
those anticipated in these forward-looking statements, even if new information
becomes available in the future.



                                      -12-
<PAGE>   15


                                    PART II.

                                OTHER INFORMATION

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

On May 16, 2000 AccuMed held its annual meeting of stockholders. The only matter
voted upon was the election of directors. The following nominees were elected as
directors by the votes indicated.

<TABLE>
<CAPTION>

Director                   Votes For            Votes Withheld
--------                   ---------            --------------
<S>                        <C>                  <C>
Mark Banister              2,892,937                 27,238

Jack H. Halperin           2,893,287                 26,888

Paul F. Lavallee           2,893,870                 26,305

Robert L. Priddy           2,893,687                 26,488

Leonard M. Schiller        2,893,687                 26,505

</TABLE>


ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.

     (a) Exhibits. The following exhibits are filed herewith:


          10.1      Amendment to Patent and Technology License Agreement dated
                    June 9, 2000 between AccuMed and Ampersand Medical
                    Corporation

          27.1      Financial Data Schedule

     (b) No reports on Form 8-K were filed during the three-month period ended
June 30, 2000.



                                      -13-
<PAGE>   16


                                   SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this Report to be signed on its behalf by the
undersigned thereunto duly authorized.


                                         ACCUMED INTERNATIONAL, INC.

                                         /s/ PAUL F. LAVALLEE
                                         -------------------------------------
                                         Paul F. Lavallee
                                         Chairman of the Board and
                                         Chief Executive Officer
                                         (Principal Accounting Officer)



Date:  August 10, 2000



                                      -14-
<PAGE>   17


                                Index to Exhibits


Exhibit No.     Description of Exhibit
-----------     ----------------------

  10.1          Amendment to Patent and Technology License Agreement dated
                June 9, 2000 between AccuMed and Ampersand Medical Corporation

  27.1          Financial Data Schedule


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.1
<SEQUENCE>2
<FILENAME>ex10-1.txt
<DESCRIPTION>EXHIBIT 10.1
<TEXT>

<PAGE>   1
                                                                    EXHIBIT 10.1

              AMENDMENT TO PATENT AND TECHNOLOGY LICENSE AGREEMENT



     This This AMENDMENT TO PATENT AND TECHNOLOGY LICENSE AGREEMENT
("Amendment") is made and entered into as of this 9th day of June, 2000 by and
between ACCUMED INTERNATIONAL, INC., a Delaware corporation ("AccuMed") and
AMPERSAND MEDICAL CORPORATION ("Ampersand" or "Licensee"), a Delaware
corporation, as Assignee of INPATH, LLC. ("Inpath"), a wholly owned subsidiary
of Ampersand.

     WHEREAS, as of September 4, 1998 AccuMed and Inpath entered into that
certain Patent and Technology Licence Agreement (the "License Agreement").

     WHEREAS, on November 19, 1999 Inpath purported to terminate the License
Agreement.

     WHEREAS, AccuMed challenged the validity of the November 19, 1999
termination of the License Agreement by Inpath.

     WHEREAS, on March 29, 2000 the parties hereto entered into a Letter
Agreement ("Letter Agreement") pursuant to which the parties agreed to resolve
all differences among them as set forth in the Letter Agreement and in this
Amendment, the Assignment and the related Additional License and Purchase
Agreement described therein.

     WHEREAS, in conjunction with this Amendment, Inpath has assigned all of its
rights, title, interest and obligations under the License Agreement and this
Amendment to Ampersand.

     WHEREAS, pursuant to the Letter Agreement, AccuMed agreed to the Assignment
of the License Agreement by Inpath to Ampersand.

     NOW, THEREFORE, for valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, AccuMed and Ampersand hereby agree as follows:

     1. Definitions. The capitalized terms used in this Amendment shall have the
respective meanings ascribed to them in the License Agreement unless otherwise
expressly defined in this Amendment.

     2. Reinstatement of License Agreement. AccuMed and Ampersand agree to
reinstate and modify the September 4, 1998 License Agreement as set forth
herein.

     3. The following definitions outlined in the License Agreement are hereby
replaced with the following:

     "Foreign Patents" means, collectively (i) the letters patent corresponding
     to the U.S. Patents, issued or applied for in a country other than the
     United States; (ii) the continuations, continuations-in-part, or divisions
     thereof; and (iii) any and all improvements,




<PAGE>   2


     modifications, extensions, renewals, or reissues of such Patent, subject to
     the provisions of Section 5.1 governing the prosecution thereof.

     "Sales" means all recorded booked revenues for actual sales upon which
     payment has been collected by Licensee or an Affiliated Person of Licensee
     (whether in cash or by way of other benefit, advantage, or concession (in
     which case the applicable revenue will be the monetary equivalent or value
     of same).

     "U.S. Patents" means (i) AccuMed's Patent entitled "A Method and Apparatus
     For Imaging and Sampling Diseased Tissue Using Autofluorescence" U.S.
     patent number 5,999,844 dated 12/07/99; (ii) the continuations,
     continuations-in-part or divisions thereof, if any; and (iii) any and all
     improvements, modifications, extensions, renewals or reissues of such
     Patent, if any.

     4. Section 2.1 of the License Agreement is replaced with the following:

     2.1 Grant of License in Patents. AccuMed hereby grants to Licensee, and
     Licensee accepts from AccuMed, an exclusive, non-transferable (except as
     provided in Section 10.8 herein), non-divisible license to make, have made,
     use, offer to sell and sell Licensed Products covered by the U.S. Patents
     and Foreign Patents for use in cervical and ovarian gynecological
     applications for Point of Care and concurrent with a patient's medical
     office visit in a physician's office and the non-exclusive license to make,
     have made, use, offer to sell and sell Licensed Products covered by the
     U.S. Patents and Foreign Patents for use in cervical and ovarian
     gynecological applications for Point of Care in labs outside of the
     physician's office.

     5. Section 2.2 of the License Agreement is replaced with the following:

     2.2 Grant of License in Technology. AccuMed hereby grants to Licensee, and
     Licensee accepts from AccuMed, and exclusive, non-transferable (except as
     provided in Section 10.8 herein), non-divisible license to make, have made,
     use, offer to sell and sell Licensed Products utilizing the Technology for
     use in cervical and ovarian gynecological applications for Point of Care
     and concurrent with a patient's medical office visit in a physician's
     office and the non-exclusive license to make, have made, use, offer to sell
     and sell Licensed Products utilizing the Technology for use in cervical and
     ovarian gynecological applications for Point of Care in labs outside of the
     physician's office.

     6. The following sentence is added to the end of Section 2.5:

          "The parties acknowledge and agree that AccuMed has no obligation,
          express or implied, to (i) develop any improvements to the U.S.
          Patents, the Foreign Patents, the Technology on the Copyrighted Works
          or (ii) to file any patent applications for any further developments,
          inventions or discoveries known to AccuMed.




                                       2
<PAGE>   3


     7. Section 2.6 of the License Agreement is stricken in its entirety.

     8. Section 3.1 of the License Agreement is modified to add the following
sentence:

     As of the date of the Amendment hereto, all of the Guaranteed License Issue
Fees due to be paid hereunder have been paid and no further amounts are
outstanding.

     9. Section 3.2 of the License Agreement is replaced with the following:

     3.2  Required Royalty; Minimum Guaranteed Payments; Advanced Required
          Royalty Payments.

          (a) For the rights and privileges granted to Licensee under this
          Agreement, Licensee (subject to paragraph (b) of Section 5.1, Section
          5.2, and Section 5.3) shall pay to AccuMed from and after January 1,
          2000 until the licenses hereunder are terminated in accordance with
          this Agreement, a royalty rate equal to 4% of all Sales ("Required
          Royalty").

          (b) Notwithstanding the amount of any sales or Required Royalty,
          Licensee shall pay AccuMed, a minimum guaranteed payment of $5,000,000
          ("Minimum Guaranteed Payment") payable by Licensee only out of the
          booked revenues for Sales at the Royalty Rate outlined in (a) herein
          as Required Royalty Payments for the term of the Agreement. In the
          event that the Minimum Guaranteed Payment of $5,000,000 is not paid in
          full at the time of the termination of this Agreement, then the
          difference between the amounts actually paid by Licensee to AccuMed as
          Required Royalty Payments and $5,000,000 shall be immediately due and
          payable by Licensee to AccuMed.

          (c) Upon the signing by all parties of the Amendment, and related
          documents, Licensee shall pay or provide to AccuMed the following:

          (i) $500,000 in cash, which cash payment shall represent an advanced,
          non-refundable Required Royalty Payment hereunder;

          (ii) a $100,000 convertible promissory note payable to AccuMed (with
          conversion rights at $3.50/share into registered shares of Ampersand)
          bearing interest of 11% and due or convertible on March 29, 2001. The
          principal amount of the note shall represent an additional advanced,
          non-refundable Required Royalty Payment hereunder; and

          (iii) 128,571 shares of Ampersand common stock which stock Ampersand
          will price protect to a share price of not less than $3.50/share to a
          measurement date sixty days following the date on which the shares
          being issued become registered and are freely




                                       3
<PAGE>   4


          tradable. If the market price at the measurement date is less than
          $3.50 per share, Ampersand shall at its option (x) make a cash payment
          to AccuMed in an amount representing the difference in market price
          and $3.50 per share multiplied by 128,571 shares or (y) issue an
          additional number of Ampersand shares to AccuMed which number shall be
          arrived at by multiplying the difference in the then market price per
          share and $3.50 and dividing the resultant sum by the then market
          price per share. The issuance of common stock by Ampersand to AccuMed
          as outlined herein, to a value of $450,000, shall represent an
          additional advanced, non-refundable Required Royalty Payment
          hereunder.

          (d) The cash payments and issuance of stock outlined in (c)(i) - (iii)
          herein represent the payment by Licensee of advanced Required Royalty
          Payments to AccuMed. Ampersand shall not be required to make any
          additional payments to AccuMed for Required Royalty Payments until the
          total of the Required Royalty Payments called for hereunder from
          Ampersand, exceeds the amount of advanced Required Royalty Payments
          actually made by Ampersand to AccuMed pursuant to paragraphs
          c(i)-(iii) herein.

          (e) The shares of Ampersand stock to be issued to AccuMed herein shall
          be registered with an appropriate Registration Statement (excluding
          the S-8 underlying the Employee Equity Incentive Plan) which is
          presently being prepared by Ampersand. AccuMed will not be subject to
          any restrictions in the disposal of shares it holds, other than those
          regarding unregistered shares prior to the effective date of the
          Registration Statement outlined herein and those imposed by applicable
          securities laws.

     10. Paragraph 5.1 of the License Agreement is replaced with the following:

          5.1 Prosecution and Protection.

               (a) AccuMed shall have the authority, in its discretion, but no
          duty to prosecute the application for the issuance of Foreign Patents.
          If AccuMed shall elect to prosecute a Foreign Patent under this
          Section, it shall be at the sole cost and expense of AccuMed.


               (b) Licensee shall notify AccuMed in writing of Licensee's sale
          of Licensed Products in any Foreign Country upon or prior to the date
          on which Licensee first sells Licensed Products in such Foreign
          Country. If a Foreign Patent shall not already be pending or issued in
          such Foreign County, AccuMed shall have twenty-one (21) days from such
          written notice to notify Licensee in writing whether or not AccuMed
          will commence the prosecution thereof. If AccuMed elects, in such
          notice, not to prosecute a Foreign Patent in such Foreign Country or
          if AccuMed fails to make a timely election, then Licensee may elect to
          prosecute such Foreign Patent, at Licensee's sole cost and expense,
          for and on behalf of and in the name of AccuMed. Licensee may deduct
          all reasonable out-of-pocket costs and expenses,




                                       4
<PAGE>   5


          including without limitation, attorneys' fees and filing costs,
          incurred by Licensee for its prosecution (in accordance its election
          under with this paragraph) of Foreign Patents in any Foreign Country
          from the Required Royalties (but not the Minimum Guaranteed Payments)
          applicable to that Foreign Country under Section 3.2. AccuMed will
          provide to Licensee all information, papers, instruments or affidavits
          required to apply for and obtain Foreign Patents in AccuMed's name and
          will provide reasonable assistance to Licensee in Licensee's efforts
          to prosecute any Foreign Patents in accordance with its election under
          this paragraph. Any such Foreign Patents prosecuted by Licensee for
          and on behalf of AccuMed shall be the sole and exclusive property of
          AccuMed, but Licensee shall be granted a license thereunder coincident
          with the grant under Section 2.1 for all Foreign Patents.

               (c) Nothing in this Section shall (i) require either AccuMed or
          Licensee to prosecute patents in any Foreign Country or (ii) as
          between the parties, restrict Licensee from exercising its exclusive
          license rights under this Agreement in any Foreign Country or
          throughout the Territory, regardless of whether Licensee or AccuMed
          elects to prosecute any application for Foreign Patents therein.

     11. Paragraph 5.2 of the License Agreement is replaced with the following:


          5.2 Infringement by Third Parties. Each party shall inform the other
          party of any infringement or suspected infringement of the Patents or
          infringement (including any misappropriation) of the Technology of
          which such party becomes aware within ten (10) business days after
          such party becomes aware of any such infringement or suspected
          infringement. For a period of thirty (30) days after receipt by
          AccuMed of, or AccuMed's sending of, such notice of infringement,
          AccuMed will have the exclusive right to commence an action and
          otherwise assert rights in the Patents and the Technology against any
          such infringers or suspected infringers and will have the right at its
          sole discretion to make any settlement or compromise with the
          third-party infringer, provided that the terms of any such settlement
          may not modify the exclusivity of the licenses granted to LICENSEE in
          this Agreement or otherwise diminish LICENSEE'S economic rights or
          expectations hereunder. If AccuMed shall elect to prosecute any such
          infringer, LICENSEE shall take such steps as are reasonably requested
          by AccuMed to enable it to protect its rights under the Patents and
          under the Technology against any such infringement or suspected
          infringement. If (i) AccuMed fails to commence an action or otherwise
          assert its rights in the Patents and the Technology against any such
          infringers or suspected infringers within such thirty (30) day period
          and (ii) LICENSEE provides AccuMed with the opinion of patent counsel
          mutually acceptable to the parties stating that there is a likelihood
          of infringement or misappropriation by such suspected infringers (an
          "Infringement Opinion"), then LICENSEE may bring an action or
          proceeding




                                       5
<PAGE>   6


          (including any alternative dispute resolution process) to enjoin the
          infringement, to recover damages for it, or both and AccuMed grants
          LICENSEE the right to use AccuMed's name in connection therewith and
          will have the right at LICENSEE'S sole discretion to make any
          settlement or compromise with the third-party infringer, in accordance
          with and subject to the provisions set forth below. If an Infringement
          Opinion is delivered to AccuMed and, accordingly, LICENSEE is
          permitted to bring such action, then LICENSEE may elect to deduct a
          percentage of its out-of-pocket costs and expenses (but otherwise will
          bear all other costs and expenses), which includes without limitation
          court costs and attorneys' fees for such action up to a maximum
          deduction of fifty percent (the "Fee Percentage") and shall notify
          AccuMed of such election and the applicable Fee Percentage when the
          Infringement Opinion is delivered by LICENSEE to AccuMed. LICENSEE
          shall be permitted to deduct from future Minimum Guaranteed Payments
          and Required Royalties, as they become due under this Agreement, that
          portion of its out-of-pocket expenses in an amount equal to the Fee
          Percentage thereof. All proceeds of any action or proceeding brought
          by LICENSEE or AccuMed (if any) shall be shared between AccuMed and
          LICENSEE pro rata in accordance with the Fee Percentage (i.e. AccuMed
          shall receive the Fee Percentage of such proceeds and LICENSEE shall
          receive the remainder). If LICENSEE shall be permitted to bring an
          action pursuant to this Section, AccuMed shall take such steps as are
          reasonably requested by LICENSEE at LICENSEE'S expense to enable it to
          protect its licensee rights under the Patents and under the Technology
          against any such infringement or suspected infringement.

     12. Section 6.3(a) of the License Agreement is replaced by the following:

               (a) Licensee Covenant. Licensee shall not, directly or
          indirectly, whether through an Affiliated Person or otherwise, until
          the termination of this Agreement, and for a period of one year
          thereafter, without the prior written approval of AccuMed, employ,
          engage, or seek to employ or engage, directly or indirectly, any
          employee of AccuMed or its subsidiaries.

     13. Paragraph 9.2 of the License Agreement is replaced by the following:

     9.2 Effect of Patent Invalidation. If any Patents shall issue and,
     thereafter, if all claims of all of the Patents should be finally
     determined to be invalid by a decision of a court of competent jurisdiction
     that is final and to which no right of appeal exists, then the rate of the
     Required Royalty shall be reduced from four percent (4%) to three and
     three-quarters percent (3.75%). Licensee acknowledges that the licenses
     hereunder in the Technology independent of any issued and valid Patent are
     valuable and reasonable consideration for the Required Royalty and Minimum
     Guaranteed Payments. Licensee shall pay (subject to paragraph (b)




                                       6

<PAGE>   7


     of Section 5.1, Section 5.2, and Section 5.3) all Required Royalties (at
     the four percent (4%) rate) due and payable before any such final
     determination of invalidity and during the pendency of any validly
     challenge, and Licensee is not entitled to any refund or credit for any
     past due Minimum Guaranteed Payments, Required Royalties, or the Guaranteed
     License Issue Fee payments. Licensee shall pay all Royalty Payments
     accruing during the pendency of any challenge to the validity of any of the
     Patents.

     14. Paragraph 9.3 of the License Agreement shall be replaced by the
following:

     9.3 Termination by Licensee. Licensee shall not be entitled to terminate
     its obligations under this Agreement until AccuMed's receipt of the Minimum
     Guaranteed Payment of $5,000,000. Thereafter, Licensee, at its election may
     (x) terminate the exclusivity of the licenses granted hereunder upon thirty
     (30) days written notice to AccuMed that in Licensee's reasonable
     determination the commercial exploitation of the Licensed Product is not
     commercially viable; or (y) terminate this Agreement in its entirety. In
     the event that Licensee terminates the exclusivity in accordance with (x)
     herein, Licensee shall continue to be obligated to make Required Royalty
     Payments. In the event that Licensee seeks to terminate this Agreement in
     its entirety, Licensee is still required to pay the Minimum Guaranteed
     Royalty Payment of $5,000,000 called for in section 3.2 of this Agreement
     and such amount shall be due and payable before any such termination shall
     be deemed effective. In the event that Licensee seeks to terminate this
     Agreement or its exclusivity, Licensee shall not be entitled to the refund
     of any Minimum Guaranteed Payments (including those advanced pursuant to
     Section 3.2 herein, Required Royalty Payments or the Guaranteed License
     Issue Fee that have been paid to date.

     15. In Section 9.4 of the License Agreement, delete "(or, at AccuMed's
discretion, destroy and certify to AccuMed the destruction of)".

     16. With reference to Section 10.4 of the License Agreement, the parties
acknowledge and agree that, upon execution of this Agreement and payment of the
amounts owing to Peter P. Gombrich as outlined in paragraph 5 of the Letter
Agreement, the Letter Agreement will be superseded.

     17. Paragraph 10.5 of the License Agreement shall be modified to reflect
the new addresses listed below:

     AccuMed International, Inc.
     920 North Franklin Street, Suite 402
     Chicago, Illinois 60610
     Attention: Paul F. Lavallee
                Chairman and CEO
     Telephone No.: (312) 642-9200
     Fax No.: (312) 642-3101




                                       7
<PAGE>   8


     Ampersand Medical Corporation
     414 N. Orleans
     Suite 305
     Chicago, IL 60610
     Attention: Peter P. Gombrich, Chairman and CEO
     Telephone Number: (312) 222-9550
     Fax Number: (312) 222- 9580

with a copy to its counsel:

     Janet S. Baer
     Schwartz, Cooper, Greenberger & Krauss
     180 N. LaSalle Street
     Suite 2700
     Chicago, IL 60601
     (312) 346-1300

     18. Section 10.8 is replaced with the following:

     10.8 Succession and Transferability. This Agreement and the License granted
     hereunder shall be binding upon and inure to the benefit of Licensee and
     its successors and assignees permitted hereunder and AccuMed and its
     successors and assignees. Licensee shall not assign this Agreement or the
     License granted hereunder, except to an Affiliated Person, in a sale of
     substantially all of the assets or equity shares of Licensee, or through a
     merger of Licensee into another entity wherein such Affiliated Person,
     purchaser or entity agrees in writing to be bound by this Agreement.

     19. A new paragraph 10.11 is added to the License Agreement which provides
as follows:

     10.11 Mutual Release. The parties hereto mutually release and forever
     discharge each other and their respective agents, officers, directors,
     shareholders, partners, employees, successors, representatives, attorneys
     and assigns, of and from, all actions, agreements, bills, bonds, causes of
     action, claims, controversies, counterclaims, covenants, cross-claims,
     damages, debts, demands, executions, indemnities, judgments, liens,
     promises, suits, third-party actions, filed or unfiled, and sums of money
     whatsoever, in law or in equity, arising out of the disputes which they now
     have or have had to date with respect to the License Agreement, the
     Patents, the Technology and the Copyrighted Works.


                      (Signature Page Immediately Follows)




                                       8
<PAGE>   9


    (Signature Page to Amendment to Patent and Technology License Agreement)




     IN WITNESS WHEREOF, the parties hereto have caused this Amendment to Patent
and Technology License Agreement to be executed as of the day and year first
above written.

         AMPERSAND MEDICAL CORPORATION



         By:   /s/ PETER P. GOMBRICH
               ---------------------
                  Peter P. Gombrich
                  Chairman and CEO

         INPATH, LLC



         By:   /s/ PETER P. GOMBRICH
               ---------------------
                  Peter P. Gombrich
                  Chairman and CEO

         ACCUMED INTERNATIONAL, INC.



         By:  /s/ PAUL F. LAVALLEE
              --------------------
                  Paul F. Lavallee
                  Chairman and CEO




                                       9
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-27.1
<SEQUENCE>3
<FILENAME>ex27-1.txt
<DESCRIPTION>FINANCIAL DATA SCHEDULE
<TEXT>

<TABLE> <S> <C>

<ARTICLE> 5
<MULTIPLIER> 1,000

<S>                             <C>
<PERIOD-TYPE>                   6-MOS
<FISCAL-YEAR-END>                          DEC-31-2000
<PERIOD-START>                             JAN-01-2000
<PERIOD-END>                               JUN-30-2000
<CASH>                                             656
<SECURITIES>                                       237
<RECEIVABLES>                                        0
<ALLOWANCES>                                         0
<INVENTORY>                                        692
<CURRENT-ASSETS>                                 1,626
<PP&E>                                           2,068
<DEPRECIATION>                                   1,507
<TOTAL-ASSETS>                                   6,899
<CURRENT-LIABILITIES>                            1,614
<BONDS>                                            405
<PREFERRED-MANDATORY>                               57
<PREFERRED>                                          0
<COMMON>                                         2,868
<OTHER-SE>                                       1,152
<TOTAL-LIABILITY-AND-EQUITY>                     6,899
<SALES>                                            168
<TOTAL-REVENUES>                                   239
<CGS>                                               50
<TOTAL-COSTS>                                       50
<OTHER-EXPENSES>                                 2,241
<LOSS-PROVISION>                                     0
<INTEREST-EXPENSE>                                  15
<INCOME-PRETAX>                                (1,711)
<INCOME-TAX>                                         0
<INCOME-CONTINUING>                            (1,711)
<DISCONTINUED>                                       0
<EXTRAORDINARY>                                      0
<CHANGES>                                            0
<NET-INCOME>                                   (1,711)
<EPS-BASIC>                                      (.31)
<EPS-DILUTED>                                    (.31)


</TABLE>
</TEXT>
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</SUBMISSION>
