<PAGE>
   AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON FEBRUARY __, 1998
                                                      REGISTRATION NO. 333-_____
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
 
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                          ---------------------------
 
                                    FORM S-1
                             REGISTRATION STATEMENT
                                     UNDER
                           THE SECURITIES ACT OF 1933
                          ---------------------------
 
                          PROFESSIONAL DETAILING, INC.
             (Exact name of Registrant as specified in its charter)
 
<TABLE>
<S>                                        <C>                                        <C>
                DELAWARE                                     7389                                    22-3562897
     (State or Other Jurisdiction of             (Primary Standard Industrial                     (I.R.S. Employer
     Incorporation or Organization)               Classification Code Number)                    Identification No.)
                                                    599 MacArthur Boulevard
                                                 Mahwah, New Jersey 07430-2326
                                                        (201) 818-8450
                                                   (201) 818-8445 Facsimile
</TABLE>
 
  (Address, including zip code, and telephone number, including area code, of
                        Registrant's executive offices)
 
                              CHARLES T. SALDARINI
                     PRESIDENT AND CHIEF EXECUTIVE OFFICER
                          PROFESSIONAL DETAILING, INC.
                            599 MACARTHUR BOULEVARD
                         MAHWAH, NEW JERSEY 07430-2326
                                 (201) 818-8450
                            (201) 818-8445 FACSIMILE
 (Name, address, including zip code, and telephone number, including area code,
                             of agent for service)
 
                          ---------------------------
 
                                   Copies to:
 
<TABLE>
<S>                                                              <C>
                     KENNETH S. ROSE, ESQ.                                           KEITH F. HIGGINS, ESQ.
                   JOEL J. GOLDSCHMIDT, ESQ.                                              ROPES & GRAY
              MORSE, ZELNICK, ROSE & LANDER, LLP                                     ONE INTERNATIONAL PLACE
                        450 PARK AVENUE                                            BOSTON, MASSACHUSETTS 02110
                   NEW YORK, NEW YORK 10022                                              (617) 951-7000
                        (212) 838-5030                                              (617) 951-7050 FACSIMILE
                   (212) 838-9190 FACSIMILE
</TABLE>
 
                          ---------------------------
 
    APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: AS SOON AS
PRACTICABLE AFTER THIS REGISTRATION STATEMENT BECOMES EFFECTIVE.
 
    If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, as amended (the 'Securities Act'), check the following box. / /
 
    If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, check the following box and
list the Securities Act registration statement number of the earlier effective
registration statement for the same offering. / /
 
    If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / /
 
    If this Form is a post-effective amendment filed pursuant to Rule 462(d)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / /
 
    If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. / /
 
                          ---------------------------
 
                        CALCULATION OF REGISTRATION FEE
 
<TABLE>
<CAPTION>
                    TITLE OF EACH CLASS OF                             PROPOSED MAXIMUM                     AMOUNT OF
                 SECURITIES TO BE REGISTERED                     AGGREGATE OFFERING PRICE (1)           REGISTRATION FEE
<S>                                                             <C>                              <C>
Common Stock, $.01 par value..................................            $46,000,000                      $13,570.00
</TABLE>
 
(1) Estimated solely for purposes of calculating the amount of the registration
    fee paid pursuant to Rule 457(o) under the Securities Act.
 
    THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE SECURITIES AND EXCHANGE COMMISSION, ACTING
PURSUANT TO SAID SECTION 8(A), MAY DETERMINE.
 
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------

<PAGE>

INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT.  A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION  OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.

PROSPECTUS (SUBJECT TO COMPLETION)
ISSUED _____________ ___, 1998

                         ________________________SHARES
                          PROFESSIONAL DETAILING, INC.
                                  COMMON STOCK
 
                            ------------------------
 
ALL OF THE SHARES OF COMMON STOCK BEING OFFERED HEREBY ARE BEING SOLD BY THE
COMPANY. PRIOR TO THE OFFERING, THERE HAS BEEN NO PUBLIC MARKET FOR THE
   COMMON STOCK OF THE COMPANY. IT IS CURRENTLY ESTIMATED THAT THE INITIAL
   PUBLIC OFFERING PRICE PER SHARE WILL BE BETWEEN $______ AND $______. SEE
     'UNDERWRITERS' FOR A DISCUSSION OF THE FACTORS TO BE CONSIDERED IN
                 DETERMINING THE INITIAL PUBLIC OFFERING PRICE.
 
                            ------------------------
 
      APPLICATION HAS BEEN MADE TO LIST THE COMMON STOCK FOR QUOTATION ON
              THE NASDAQ NATIONAL MARKET UNDER THE SYMBOL 'PDII.'
 
                            ------------------------
 
        THIS OFFERING INVOLVES A HIGH DEGREE OF RISK. SEE 'RISK FACTORS'
                    BEGINNING ON PAGE 7 OF THIS PROSPECTUS.
 
                            ------------------------
 
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
      EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
    SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
         PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
            REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
 
                            ------------------------
 
                             PRICE $       A SHARE
 
                            ------------------------
 
<TABLE>
<CAPTION>
                                                                       UNDERWRITING
                                                PRICE TO               DISCOUNTS AND             PROCEEDS TO
                                                 PUBLIC               COMMISSIONS (1)            COMPANY (2)
                                            ----------------          ---------------          ----------------
<S>                                         <C>                       <C>                      <C>
Per Share..............................            $                         $                        $
Total (3)..............................            $                         $                        $
</TABLE>
 
------------------
(1) The Company has agreed to indemnify the Underwriters against certain
    liabilities, including liabilities under the Securities Act of 1933, as
    amended.
 
(2) Before deducting expenses payable by the Company estimated at $______.
 
(3) The Company has granted to the Underwriters an option, exercisable within 30
    days of the date hereof, to purchase up to an aggregate of ______ additional
    Shares at the price to public less underwriting discounts and commissions
    for the purpose of covering over-allotments, if any. If the Underwriters
    exercise such Shares in full, the total price to public, underwriting
    discounts and commissions and proceeds to Company will be $______, $______
    and $______, respectively. See 'Underwriters.'
                            ------------------------
 
     The Shares are offered, subject to prior sale, when, as and if accepted by
the Underwriters named herein and subject to approval of certain legal matters
by Ropes & Gray, counsel for the Underwriters. It is expected that delivery of
the Shares will be made on or about           , 1998 at the office of Morgan
Stanley & Co. Incorporated, New York, N.Y., against payment therefor in
immediately available funds.
                            ------------------------
 
MORGAN STANLEY DEAN WITTER
                            WILLIAM BLAIR & COMPANY
                                                               HAMBRECHT & QUIST
 
            , 1998

<PAGE>
     NO PERSON IS AUTHORIZED IN CONNECTION WITH ANY OFFERING MADE HEREBY TO GIVE
ANY INFORMATION OR TO MAKE ANY REPRESENTATION NOT CONTAINED IN THIS PROSPECTUS,
AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION MUST NOT BE RELIED
UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY OR BY ANY UNDERWRITER. THIS
PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO
BUY ANY SECURITY OTHER THAN THE SHARES OF COMMON STOCK OFFERED HEREBY, NOR DOES
IT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY OF THE
SECURITIES OFFERED HEREBY TO ANY PERSON IN ANY JURISDICTION IN WHICH IT IS
UNLAWFUL TO MAKE SUCH AN OFFER OR SOLICITATION TO SUCH PERSON. NEITHER THE
DELIVERY OF THIS PROSPECTUS NOR ANY OFFER OR SALE MADE HEREBY SHALL UNDER ANY
CIRCUMSTANCE IMPLY THAT THE INFORMATION CONTAINED HEREIN IS CORRECT AS OF ANY
DATE SUBSEQUENT TO THE DATE HEREOF.
                            ------------------------
 
     UNTIL         , 1998 (25 DAYS AFTER THE COMMENCEMENT OF THE OFFERING) ALL
DEALERS EFFECTING TRANSACTIONS IN THE COMMON STOCK, WHETHER OR NOT PARTICIPATING
IN THIS DISTRIBUTION, MAY BE REQUIRED TO DELIVER A PROSPECTUS. THIS IS IN
ADDITION TO THE OBLIGATION OF DEALERS TO DELIVER A PROSPECTUS WHEN ACTING AS
UNDERWRITERS AND WITH RESPECT TO THEIR UNSOLD ALLOTMENTS OR SUBSCRIPTIONS.
                            ------------------------
 
                               TABLE OF CONTENTS
 
<TABLE>
<CAPTION>
                                                                                                              PAGE
                                                                                                              ----
<S>                                                                                                           <C>
Prospectus Summary........................................................................................      3
Summary Financial Data....................................................................................      5
Risk Factors..............................................................................................      7
Use of Proceeds...........................................................................................     13
Dividend Policy...........................................................................................     13
S Corporation Termination.................................................................................     13
Capitalization............................................................................................     14
Dilution..................................................................................................     15
Selected Financial Data...................................................................................     16
Management's Discussion and Analysis of Financial Condition and Results of Operations.....................     18
Business..................................................................................................     24
Management................................................................................................     37
Certain Transactions......................................................................................     42
Principal Shareholders....................................................................................     43
Description of Capital Stock..............................................................................     44
Shares Eligible for Future Sale...........................................................................     46
Underwriters..............................................................................................     47
Legal Matters.............................................................................................     48
Experts...................................................................................................     49
Additional Information....................................................................................     49
Index to Financial Statements.............................................................................    F-1
</TABLE>
 
                            ------------------------
 
     The Company intends to furnish to its stockholders annual reports
containing audited financial statements and an opinion thereon expressed by
independent accountants and quarterly reports for the first three quarters of
each fiscal year containing interim financial information.
                            ------------------------
 
     CERTAIN PERSONS PARTICIPATING IN THIS OFFERING MAY ENGAGE IN TRANSACTIONS
THAT STABILIZE, MAINTAIN, OR OTHERWISE AFFECT THE PRICE OF THE COMMON STOCK.
SPECIFICALLY, THE UNDERWRITERS MAY OVERALLOT IN CONNECTION WITH THE OFFERING,
AND MAY BID FOR, AND PURCHASE, SHARES OF THE COMMON STOCK IN THE OPEN MARKET.
FOR A DESCRIPTION OF THESE ACTIVITIES, SEE 'UNDERWRITERS.'
                            ------------------------
 
     In this Prospectus, the term the 'Company' or 'PDI' includes Professional
Detailing, Inc., a Delaware corporation, and its predecessors. The Company's
corporate headquarters are located at 599 MacArthur Boulevard, Mahwah, New
Jersey 07430, and its telephone number is (201) 818-8450.

<PAGE>
                               PROSPECTUS SUMMARY
 
     The following summary is qualified in its entirety by the more detailed
information and the Financial Statements and the notes thereto appearing
elsewhere in this Prospectus. Unless otherwise indicated, the information in
this Prospectus has been adjusted to reflect a merger (the 'Merger') of
Professional Detailing, Inc., a New Jersey corporation, with and into
Professional Detailing, Inc., a Delaware corporation, immediately prior to the
effective date of the registration statement of which this Prospectus is a part.
Upon completion of the Merger, the shareholders of the New Jersey corporation
will own an aggregate of _______ shares of the Delaware corporation and all
outstanding options to purchase shares of the New Jersey corporation will be
converted into options to purchase shares of the Delaware corporation. All
references herein to industry financial and statistical information are based on
trade articles, industry reports and other sources that the Company believes to
be reliable, although there can be no assurance to that effect. Unless specified
to the contrary or the context clearly implies otherwise, all references herein
to the 'Company' or 'PDI' shall be deemed to include Professional Detailing,
Inc., a Delaware corporation, and its predecessors. Unless otherwise indicated,
the information in this Prospectus assumes no exercise of the Underwriters'
over-allotment option.
 
                                  THE COMPANY
 
     The Company is a leading provider of comprehensive customized sales
solutions on an outsourced basis to the United States pharmaceutical industry.
The Company believes it has achieved this leadership position based on its 10
years of industry experience and its relationships with many of the
pharmaceutical industry's largest companies. Since inception, the Company has
designed customized product detailing programs for approximately 25 clients,
including Pfizer, Inc., Astra Merck Inc., Glaxo Wellcome Inc. and Johnson &
Johnson, Inc. These programs have been designed to promote more than 70
different products, including such leading prescription medications as
Prilosec(Registered), Wellbutrin(Registered) and Cardura(Registered), as well as
a number of over-the-counter ('OTC') products such as Bayer(Registered) Aspirin,
Pepcid AC(Registered) and Monistat 5(Registered), to hospitals, pharmacies and
physicians in approximately 20 different specialties. The Company's primary
objective is to enhance its leadership position in the growing contract sales
organization ('CSO') industry and to become the premier supplier of
comprehensive sales solutions to the pharmaceutical industry and other segments
of the healthcare market.
 
     The Company has demonstrated strong internal growth, generated by securing
new business from leading pharmaceutical companies and by renewing and expanding
programs with existing clients. The Company believes that it is one of the
largest CSOs operating in the United States measured both by revenue and total
number of sales representatives used in programs. Revenue and gross profit grew
at compound rates of 87.7% and 58.0%, respectively, between 1994 and 1997. The
number of sales representatives (both full-time and part-time) employed by the
Company has increased from approximately 100 as of December 31, 1993 to
approximately 1,000 as of December 31, 1997. Over that same period, the
Company's mix between part-time and full-time representatives shifted from 100%
part-time to 45% part-time. The Company has also experienced a consistently high
renewal rate among its clients. For example, for the year ended December 31,
1997, approximately 86% of the Company's revenue was generated from clients that
had contributed to its 1996 revenue.
 
     According to PMSI Scott-Levin Inc., a healthcare marketing information
company ('Scott-Levin'), United States pharmaceutical companies spent
approximately $4.5 billion on product detailing in 1996. The Company estimates
that product detailing, on average, represents approximately 60% of a
pharmaceutical company's total promotional spending. Product detailing involves
a face-to-face meeting between a sales representative and a targeted prescriber,
usually a physician identified because of his or her specialty or prescribing
patterns. Detailing generally occurs in physician offices and hospitals,
although conventions and trade association meetings may also provide an
appropriate forum. The sales representative is required to possess a high level
of product knowledge, as well as other technical and therapeutic expertise.
Product detailing involves a technical review of the product's legally
authorized indications and usage, role in disease treatment, mechanism of
action, side effects, dosing, drug interactions, cost and availability (i.e.,
the 'details').
 
     The CSO industry provides outsourced physician detailing programs to
pharmaceutical, medical device and diagnostic companies. CSOs have evolved from
providing detailing support for OTC products into a full-service industry
handling some of the leading prescription pharmaceutical compounds. Since the
early 1990s, the United States pharmaceutical industry has increasingly used
CSOs to provide the detailing service required to introduce new products,
reintroduce older products, supplement existing sales efforts, raise promotional
barriers to entry for competitors and demonstrate the incremental sales impact
of detailing a particular product. While there is little available data
regarding the CSO industry, the Company believes that there are approximately
eight CSOs currently operating in the United States. The Company also believes
that 17 of the 50 largest pharmaceutical 
 
                                       3

<Page
companies in the United States, measured by healthcare revenue, currently use
CSOs. Finally, the Company estimates that revenues for the CSO industry in the
United States increased from approximately $80 million in 1995 to $185 million
in 1996 and $325 million in 1997.
 
     The Company is engaged by its clients to design and implement product
detailing programs for both prescription and OTC pharmaceutical products. Such
programs typically include three phases: design, execution and assessment. In
the program design phase, the Company works with the client to understand needs,
define objectives, select targets and determine appropriate staffing. Program
execution involves recruiting, hiring, training and managing a sales force,
which performs detail calls promoting the particular client's pharmaceutical
products. Assessment, the last phase of the program, involves measurement of
sales force performance and program success relative to the goals and objectives
outlined in the program design phase.
 
     The Company believes that because of the benefits of outsourcing,
pharmaceutical companies have made a strategic decision to continue to outsource
a significant portion of their sales and marketing activities. The Company
believes that the trend toward the increased use of CSOs by pharmaceutical
companies will continue due to the following industry dynamics: (i)
pharmaceutical companies will continue to expand their product portfolios and,
as a result, will need to add sales force capacity, (ii) pharmaceutical
companies will continue to face margin pressures and will seek to maintain
flexibility by converting fixed costs to variable costs, and (iii) the
availability of qualified CSOs will provide an incentive to pharmaceutical
companies to continue to outsource this function.
 
     The Company believes that it is well positioned to benefit from these
growth opportunities. Through its 10 years of providing service to the United
States pharmaceutical industry, the Company has demonstrated that it is a
high-quality, results-oriented provider of detailing services. In addition, the
Company maintains a highly qualified sales force as a result of a rigorous
recruiting process and training programs that are comparable to those of the
pharmaceutical companies. The Company believes that one of its biggest
competitive advantages is its ability to provide customized solutions to its
clients. Finally, as one of the largest CSOs, the Company has achieved the size
and demonstrated the ability to perform large detailing programs and execute
multiple programs simultaneously.
 
     In order to leverage its competitive advantages, PDI's growth strategy
emphasizes: (i) enhancing its leadership position in the growing CSO market by
maintaining its historic focus on high-quality contract sales services and by
continuing to build and invest in the Company's core competencies and
operations; (ii) expanding both its relationship with existing clients and its
selling efforts to capture new clients; (iii) offering additional promotional,
marketing and educational services and further developing its existing detailing
services; (iv) entering new geographic markets; and (v) investigating and
pursuing appropriate acquisitions of detailing or detailing-related companies.
 
     The Company was incorporated under the laws of the state of Delaware on
February 10, 1998. The Company's predecessor was incorporated under the laws of
New Jersey on March 10, 1988. The Company's principal executive offices are
located at 599 MacArthur Boulevard, Mahwah, New Jersey 07430 and its telephone
number is (201) 818-8450.
 
                                  THE OFFERING
 
<TABLE>
<S>                                                                   <C>
Common Stock to be Offered..........................................  ____________Shares
Common Stock to be Outstanding after the Offering...................  ____________Shares (1)
Use of Proceeds.....................................................  Working capital for business
                                                                      expansion purposes, investment
                                                                      in infrastructure and other
                                                                      general corporate purposes,
                                                                      including potential
                                                                      acquisitions. See 'Use of
                                                                      Proceeds.'
Proposed Nasdaq National Market Symbol..............................  PDII
</TABLE>
 
------------------
(1) Excludes (i) ___________ shares of Common Stock issuable upon the exercise
    of stock options outstanding on December 31, 1997, at a weighted average
    exercise price of $___________ per share and (ii) ___________ additional
    shares of Common Stock reserved for future grants under the Company's 1998
    Stock Option Plan. See 'Management -- 1998 Stock Option Plan.'
 
                                       4

<PAGE>
                               SUMMARY FINANCIAL DATA
 
STATEMENT OF OPERATIONS DATA:
 
<TABLE>
<CAPTION>
                                                                          YEAR ENDED DECEMBER 31,
                                                           -----------------------------------------------------
                                                            1993       1994       1995        1996        1997
                                                           ------     ------     -------     -------     -------
                                                           (IN THOUSANDS, EXCEPT PER SHARE AND STATISTICAL DATA)
 
<S>                                                        <C>        <C>        <C>         <C>         <C>
Revenue................................................    $8,226     $8,250     $18,398     $33,015     $54,542
Program expenses.......................................     4,886      5,339      15,427      26,886      43,057
                                                           ------     ------     -------     -------     -------
Gross profit...........................................     3,340      2,911       2,971       6,129      11,485
Compensation expense...................................     1,945      1,673       2,124       3,191       5,121(1)
Bonus to majority shareholder(2).......................       440        200         425       1,500       2,243
Stock grant expense(3).................................        --         --          --          --       4,470
Other general, selling and administrative expenses.....       844        826       1,159       1,650       2,755
                                                           ------     ------     -------     -------     -------
Total general, selling and administrative expenses.....     3,229      2,699       3,708       6,341      14,589
                                                           ------     ------     -------     -------     -------
Operating income (loss)................................       111        212        (737)       (212)     (3,104)
Other income, net......................................        17         16          70          98         155
                                                           ------     ------     -------     -------     -------
Income (loss) before provision for taxes...............       128        228        (667)       (114)     (2,949)
Pro forma provision for (benefit from) income
  taxes(4).............................................        51         91        (121)         --          --
                                                           ------     ------     -------     -------     -------
Pro forma net income (loss)(4).........................    $   77     $  137     $  (546)    $  (114)    $(2,949)
                                                           ------     ------     -------     -------     -------
                                                           ------     ------     -------     -------     -------
Pro forma net income (loss) per share(4)...............                                                  $
                                                                                                         -------
                                                                                                         -------
Pro forma weighted average number of shares
  outstanding..........................................
                                                                                                         -------
                                                                                                         -------
 
OTHER FINANCIAL DATA:
 
Adjusted operating income (loss)(5)....................    $  551     $  412     $  (312)    $ 1,288     $ 3,609
Adjusted net income (loss)(4)(5).......................       341        257        (145)        832       2,258
 
OTHER OPERATING DATA:
 
Number of detail programs..............................         8          9          10          13          15
Number of clients......................................         6          7           7           8          12
Average size of detail program.........................    $1,028     $  917     $ 1,840     $ 2,540     $ 3,636
Number of sales representatives at end of period:
  Full-time............................................        --         --          --          29         633
  Part-time............................................       107        107         393         709         362
                                                           ------     ------     -------     -------     -------
  Total................................................       107        107         393         738         995
                                                           ------     ------     -------     -------     -------
                                                           ------     ------     -------     -------     -------
</TABLE>
 
                                                 See footnotes on following page
 
                                       5

<PAGE>
 
<TABLE>
<CAPTION>
BALANCE SHEET DATA:
                                                                                         AS OF DECEMBER 31, 1997
                                                                                        --------------------------
                                                                                                      PRO FORMA
                                                                                        ACTUAL      AS ADJUSTED(6)
                                                                                        -------     --------------
                                                                                             (IN THOUSANDS)
 
<S>                                                                                     <C>         <C>
Cash and cash equivalents...........................................................    $ 5,760        $
Working capital.....................................................................        129
Total assets........................................................................     13,691
Total long-term debt................................................................         --
Shareholders' equity (deficit)......................................................        676
</TABLE>
 
------------------
 
(1) Includes bonus compensation of $237,000 paid to Charles T. Saldarini, the
    Company's President, Chief Executive Officer and a minority shareholder. It
    is expected that, in addition to his base salary, Mr. Saldarini may receive
    cash bonuses in future periods as determined by the Compensation Committee.
    See 'Management -- Executive Compensation.'
 
(2) The Company has been treated as an S Corporation under subchapter S of the
    Internal Revenue Code of 1986, as amended (the 'Code') since January 1, 1991
    and under the corresponding provisions of the tax laws of the State of New
    Jersey since January 1, 1994. Historically, as an S Corporation, the Company
    made annual bonus payments to its majority shareholder based on the
    Company's estimated profitability and working capital requirements. With the
    exception of the distribution to be declared immediatley prior to the
    Offering, the Company does not expect to pay such bonuses in future periods.
    See 'Dividend Policy.'
 
(3) On January 1, 1997, the Company issued shares of its Common Stock to Charles
    T. Saldarini, its current President and Chief Executive Officer. As a
    result, prior to the Offering, Mr. Saldarini owns 15.0% of the Common Stock
    outstanding. For financial accounting purposes, a non-recurring, non-cash
    compensation expense was charged in the first quarter of 1997. See
    'Principal Shareholders,' 'Management,' 'Certain Transactions' and note 12
    to the Company's Financial Statements.
 
(4) As an S Corporation, the Company has not been subject to Federal or New
    Jersey corporate income taxes, other than a New Jersey state corporate
    income tax of approximately 2%. Rather, the income of the Company has been
    taxed at the shareholder level. Upon consummation of this Offering, the
    Company will no longer be treated as an S Corporation, and, accordingly,
    will be subject to Federal and state corporate income taxes. Pro forma
    provision for income taxes, net income, net income per share and adjusted
    net income for all periods presented reflect a provision for income taxes as
    if the Company had been taxed as a C Corporation for all periods.
 
(5) Adjusted to eliminate bonus to majority shareholder and stock grant expense.
    This presentation illustrates the Company's results of operations on an
    adjusted basis to reflect that the Company does not intend to pay bonuses to
    its majority shareholder or incur stock grant expense in future periods.
    These presentations should not be construed as an alternative to operating
    income or net income/(loss) (as determined in accordance with generally
    accepted accounting principles) as presented herein.
 
(6) Adjusted to reflect the receipt of the estimated net proceeds of this
    Offering and the pro forma effect of the estimated final distribution to the
    Company's existing shareholders immediately prior to this Offering of
    approximately $_____ million reflecting shareholders' equity as of the date
    of such distribution. See 'Dividend Policy,' 'S Corporation Termination' and
    'Management's Discussion and Analysis of Financial Condition and Results of
    Operations.'
 
                                       6

<PAGE>
                                  RISK FACTORS
 
     An investment in the shares of Common Stock offered hereby involves a high
degree of risk. Prospective investors should consider carefully the following
risk factors, in addition to the other information contained in this Prospectus,
in evaluating an investment in the shares of Common Stock offered hereby.
 
DEPENDENCE ON OUTSOURCING BY PHARMACEUTICAL COMPANIES
 
     The Company's revenue is highly dependent on sales and marketing
expenditures by pharmaceutical companies for the sale and distribution of
pharmaceutical products. The Company has benefited to date from the growing
trend of pharmaceutical companies to outsource sales and marketing programs to
CSOs. There can be no assurance that this trend in outsourcing will continue as
pharmaceutical companies may elect to perform such services internally. In
particular, the trend in the pharmaceutical industry toward consolidation, by
merger or otherwise, may result in a reduction in the use of CSOs. A significant
change in the direction of the outsourcing trend generally, or a trend in the
pharmaceutical industry not to use, or to reduce the use of, outsourced
marketing services, such as those provided by the Company, would have a material
adverse effect on the Company. See 'Business -- The CSO Industry.'
 
CUSTOMER CONCENTRATION
 
     The Company's revenue and profitability are highly dependent on its
relationships with several large pharmaceutical companies. In 1995, the
Company's four largest clients accounted for approximately 42%, 17%, 15% and
10%, respectively, or 84%, of its revenue. In 1996, the Company's four largest
clients accounted for approximately 30%, 21%, 17% and 16%, respectively, or 84%,
of its revenue. In 1997, the Company's four largest clients, Pfizer, Glaxo
Wellcome, Astra Merck and Novartis, accounted for approximately 25%, 22%, 19%
and 10%, respectively, or 76%, of its revenue. The Company is likely to continue
to experience a high degree of concentration of business. Such concentration may
become greater as a result of consolidation within the pharmaceutical industry.
The loss or significant reduction of business from any significant customer,
including as a result of further consolidation in the pharmaceutical industry,
could have a material adverse effect on the Company's business and results of
operations. See 'Business -- Clients and Contracts.'
 
DEPENDENCE ON THE PHARMACEUTICAL INDUSTRY
 
     Substantially all of the Company's revenue to date has been generated from
providing product detailing services to pharmaceutical companies. The Company
could be materially and adversely affected by unfavorable developments in the
pharmaceutical industry generally or any reduction in expenditures for, or
future outsourcing of, promotional, marketing and sales activities by
pharmaceutical companies or a shift in marketing focus away from detailing.
Promotional, marketing and sales expenditures by pharmaceutical companies have
in the past been, and could in the future be, negatively impacted by, among
other things, governmental reform or private market initiatives intended to
reduce the cost of pharmaceutical products or by governmental, medical
association or pharmaceutical industry initiatives designed to regulate the
manner in which pharmaceutical companies promote their products. See
'Business -- The CSO Industry.'
 
LACK OF PROFITABILITY
 
     For the years ended 1995, 1996 and 1997, the Company had net losses of
$667,000, $114,000 and $2,949,000, respectively. At December 31, 1997, the
Company had negative retained earnings of $3,416,000. While the Company's net
losses in 1995 and 1996 were primarily due to expenses incurred in connection
with the expansion of the Company's business and bonus payments to its majority
shareholder and the Company's negative retained earnings and net loss for 1997
were due to a non-cash, non-recurring compensation expense relating to stock
granted to the Company's President and Chief Executive Officer, Charles T.
Saldarini, in the first quarter of 1997, the Company must nonetheless continue
to replace and/or expand existing programs and obtain new clients in order to
achieve sustained profitability. There can be no assurance that the Company will
be able to continue to generate increased revenue or achieve profitable
operations. See 'Management's Discussion and Analysis of Financial Condition and
Results of Operations.'
 
RISKS ASSOCIATED WITH THE NATURE OF CONTRACTS
 
     The Company's contracts are generally for terms of six months to one year
and are subject to renewal upon expiration. In addition, a single contract may
account for a significant portion of the Company's total revenue. The Company's
contracts may be terminated by the client at any time for any reason. Also,
contracts typically contain significant penalties if the Company fails to meet
state performance benchmarks. While the cancellation
 
                                       7

<PAGE>
of certain of the Company's contracts by a client without cause may result in
the imposition of penalties on such client, such penalties may not act as an
adequate deterrent to the termination of such contracts. In addition, there can
be no assurance that such penalties will offset the lost revenue or the costs
incurred by the Company as a result of any such termination. Furthermore, all of
the Company's sales representatives are employees rather than independent
contractors. Accordingly, upon the termination of a particular contract, unless
the Company can immediately transfer the sales force to a new program, it either
must continue to compensate those employees, without realizing any related
revenue, or terminate their employment. If the Company terminates their
employment, it may incur significant expenses relating to such termination,
including the cost of recruiting and hiring replacement sales personnel.
Finally, substantially all of the Company's contracts are 'fixed fee'
arrangements. Accordingly, if the Company underestimates the costs associated
with the services to be provided pursuant to a particular contract, or if there
are unanticipated increases in the Company's operating or administrative
expenses, the overall profitability of the Company and the margins on a
particular contract may be adversely affected. The failure to obtain new
contracts to replace expiring contracts, the cancellation or delay of an
existing contract, the failure to satisfy the minimum performance standards set
forth in a contract, the inability of the Company to transfer a sales force to a
new program upon the termination of program, or the underestimation of costs
associated with a particular contract could have a material adverse effect on
the Company's business and results of operations. See 'Business -- Clients and
Contracts.'
 
VARIABILITY OF QUARTERLY OPERATING RESULTS
 
     The Company's results of operations have been subject to quarterly
fluctuations. In the future, quarterly operating results may fluctuate as a
result of a number of factors, including the commencement, delay, cancellation
or completion of programs; the mix of services provided; the timing of start-up
expenses for new services; the accuracy of estimates of resources required for
ongoing programs; the timing and integration of acquisitions; changes in
regulations related to pharmaceutical companies; and general economic
conditions. The Company believes that quarterly comparisons of its financial
results are not necessarily meaningful and should not be relied upon as an
indication of future performance. In addition, fluctuations in quarterly results
could affect the market price of the Common Stock in a manner unrelated to the
long term operating performance of the Company. See 'Management's Discussion and
Analysis of Financial Condition and Results of Operations -- Quarterly Results.'
 
MANAGEMENT OF GROWTH
 
     The Company has recently experienced rapid growth in the number of its
employees, the size of its programs and the scope of its operations. This growth
has placed and will continue to place a strain on operational, human and
financial resources. The Company's ability to manage such growth effectively
will depend upon its ability to enhance its management team and its ability to
attract and retain skilled employees. The Company's success will also depend on
the ability of its officers and key employees to continue to implement and
improve its operational, management information and financial control systems,
and to expand, train and manage its workforce. There can be no assurance that
the Company will be able to manage its growth effectively. Failure to manage
growth effectively could have a material adverse effect on the Company's
business and results of operations. See 'Management's Discussion and Analysis of
Financial Condition and Results of Operations' and 'Business.'
 
POSSIBLE HEALTHCARE REFORM; IMPACT OF MANAGED HEALTHCARE PROGRAMS
 
     Healthcare reform measures have been considered by Congress and other
Federal and state bodies during recent years. The intent of the proposals
generally has been to reduce healthcare costs and the growth of total healthcare
expenditures and expand healthcare coverage for the uninsured. Although
comprehensive healthcare reform has been considered, only limited proposals have
been enacted. Comprehensive healthcare reform may be considered again and
efforts to enact reform bills are likely to continue. Implementation of
government healthcare reform may adversely affect promotional and marketing
expenditures by pharmaceutical companies, which could decrease the business
opportunities available to the Company. The Company is unable to predict the
likelihood of such legislation or similar legislation being enacted into law or
the effects that any such legislation would have on its business, results of
operations and financial condition.
 
     The primary trend in the United States healthcare industry is toward cost
containment. In recent years, managed care providers have been able to exercise
greater influence through managed treatment and hospitalization patterns, a
shift from reimbursement on a cost basis to per capita limits for patient
treatment and
 
                                       8

<PAGE>
the use of formularies (lists of preapproved products that a physician may
prescribe). The increasing use of managed care, centralized purchasing
decisions, consolidations among and integration of healthcare providers are
continuing to affect purchasing and usage patterns in the healthcare system.
Decisions regarding the use of pharmaceutical products are increasingly being
consolidated into group purchasing organizations, regional integrated delivery
systems and similar organizations and are becoming more economically focused,
with decision makers taking into account the cost of the product and whether a
product reduces the cost of treatment. There can be no assurance the Company
will not be adversely affected by cost containment measures. Government or
private initiatives to further contain pharmaceutical pricing could have a
material adverse effect on the pharmaceutical industry, and thus on the Company.
See 'Business -- The CSO Industry.'
 
GOVERNMENT REGULATION
 
     The healthcare industry is subject to extensive regulation. Various laws,
regulations and guidelines promulgated by government, industry and professional
bodies affect, among other matters, the provision, licensing, labeling,
marketing, promotion, sale and distribution of healthcare services and products,
including pharmaceutical products. In addition, the Company is subject to the
rules and regulations promulgated by the Equal Employment Opportunity Commission
and similar state entities, which govern its recruiting and hiring practices and
its relationship with its employees. It is possible that additional laws,
regulations and guidelines or changes in current laws, regulations or guidelines
may be adopted in the future. The failure of the Company or its clients to
comply with such laws, regulations and guidelines, or any change in applicable
laws, regulations and guidelines could, among other things, limit or prohibit
certain business activities of the Company or its clients, subject the Company
or its clients to adverse publicity, increase the cost of regulatory compliance
or subject the Company or its clients to monetary fines or other penalties. Such
actions could have a material adverse effect on the Company's business, results
of operations, and financial condition. See 'Business -- Government and Industry
Regulation.'
 
FRAUD AND ABUSE LAWS
 
     The healthcare industry is subject to various Federal and state laws
pertaining to healthcare fraud and abuse including prohibitions on the payment
or acceptance of kickbacks or other remuneration in return for the purchase or
lease of products which are paid for by Medicare or Medicaid. Sanctions for
violating these laws include criminal penalties and civil sanctions, including
fines and penalties, and possible exclusion from Medicare, Medicaid and other
Federal healthcare programs. Although the Company believes its business
arrangements are outside the scope of such Federal and state fraud and abuse
laws, there can be no assurance that the Company's practices will not be
challenged under these laws in the future or that such a challenge would not
have a material adverse effect on the Company's business, financial condition
and results of operations. See 'Business -- Government Regulation.'
 
ABILITY TO ATTRACT AND RETAIN EXPERIENCED SALES REPRESENTATIVES
 
     The success and growth of the Company's business depends upon its ability
to attract and retain qualified and experienced sales representatives. There is
intense competition for experienced pharmaceutical sales representatives and
there can be no assurance the Company will be able to continue to attract and
retain such qualified personnel. The Company's inability to attract and retain
qualified sales representatives would have a material adverse effect on the
Company's business and results of operations. See 'Business -- Program
Description.'
 
COMPETITION; INDUSTRY CONSOLIDATION
 
     The Company primarily competes with in-house sales and marketing
departments of pharmaceutical companies, other CSOs and other third party
providers to the pharmaceutical industry, many of which possess substantially
greater capital, personnel and other resources than the Company. In addition to
the in-house sales forces of pharmaceutical companies, the Company's current
major competitors include CSOs such as Innovex Limited, a subsidiary of
Quintiles Transnational Corp., and the various sales and marketing affiliates of
Snyder Communications, Inc. As a result of competitive pressures, various sales
and marketing organizations providing services to the pharmaceutical industry
are consolidating and are becoming targets of global organizations. This trend
is likely to produce increased competition among CSOs for both clients and
acquisition candidates and increased competitive pressures on smaller providers.
If the trend in the pharmaceutical industry towards consolidation continues,
pharmaceutical companies may have excess in-house sales force capacity and may,
as a result, reduce or eliminate their use of CSOs. There are relatively few
barriers to entry into the CSO industry and
 
                                       9

<PAGE>
there can be no assurance that, as the CSO industry continues to evolve,
additional competitors with greater resources than the Company will not enter
the industry or that the Company's customers will not choose to conduct more of
their sales services internally, with other CSOs or with organizations that can
provide a broader range of sales and marketing services. Although the Company
intends to monitor industry trends and respond accordingly, there can be no
assurance that the Company will be able to anticipate and successfully respond
to such trends. Increased competition may lead to price and other forms of
competition that may have a material adverse effect on the Company's business
and results of operations. See 'Business -- Competition.'
 
POTENTIAL LIABILITY
 
     The Company is engaged in the business of detailing pharmaceutical
products. Such activities could expose the Company to risk of liability for
personal injury or death to persons using such products, although the Company
does not commercially market or sell the products to end-users. While the
Company has not been subject to any claims or incurred any liabilities due to
such claims, there can be no assurance that substantial claims or liabilities
will not arise in the future. The Company seeks to reduce its potential
liability through measures such as contractual indemnification provisions with
clients (the scope of which may vary from client to client, and the performances
of which are not secured) and reliance on insurance maintained by clients. The
Company, however, could also be held liable for errors and omissions of its
employees in connection with the services it performs that are outside the scope
of any indemnity. The Company could be materially and adversely affected if it
were required to pay damages or incur defense costs in connection with a claim
that is outside the scope of the indemnification agreements; if the indemnity,
although applicable, is not performed in accordance with its terms; or if the
Company's liability exceeds the amount of applicable insurance or indemnity. The
Company currently does not carry product liability insurance and is not insured
against the errors and omissions of its employees. See 'Business--Liability and
Insurance.'
 
POTENTIAL EMPLOYEE CLAIMS
 
      The success of the Company's business is dependent on its ability to field
a high-quality sales force relatively quickly. As part of its recruiting and
hiring process, the Company conducts a thorough screening process, drug testing
and rigorous interviews. In addition, the Company must continually evaluate its
personnel and, when necessary, terminate some of its employees with or without
cause. Accordingly, the Company is subject to lawsuits relating to wrongful
termination, discrimination and harassment. The Company maintains employment
practice liability insurance, which insures it against claims made by its
employees with respect to matters relating to their employment. There can be no
assurance, however, that the Company will continue to maintain such policy or
that the scope or limits of such policy will cover asserted claims. The Company
could be materially and adversely affected if it were required to pay damages or
incur defense costs in connection with a claim by an employee that is outside
the scope of coverage of such policy. See 'Business -- Liability and Insurance.'
 
DEPENDENCE ON KEY PERSONNEL
 
     The Company depends on a number of key executives, including Charles T.
Saldarini, its President and Chief Executive Officer, and Steven K. Budd, its
Chief Operating Officer. The loss of the services of any of the Company's key
executives could have a material adverse effect on the Company's business,
financial condition and results of operations. The Company does not maintain
'key man' life insurance policies on any of its executives although it intends
to obtain a $5 million policy on the life of Charles T. Saldarini. There can be
no assurance that the Company will be able to obtain such insurance on terms
acceptable to the Company, if at all. See 'Management.'
 
CONTROL BY EXISTING SHAREHOLDER
 
     Following completion of this Offering, assuming the Underwriters'
over-allotment option is not exercised, John P. Dugan, Chairman of the Board of
Directors of the Company, will beneficially own approximately ___% (or ___% if
the over-allotment option is exercised in full) of the Company's outstanding
Common Stock (excluding shares issuable upon the exercise of options). As a
result, Mr. Dugan will have the ability to determine the election of all of the
Company's directors, and to determine the outcome of most corporate actions
requiring shareholder approval, including the merger of the Company with or into
another company, the sale of all or substantially all of the Company's assets
and amendments to the Company's Certificate of Incorporation (the 'Certificate
of Incorporation'). In addition, Mr. Dugan will have the power to delay, defer
or prevent a change in control of the Company. See 'Principal Shareholders.'
 
                                       10

<PAGE>
ACQUISITION RISKS
 
     As part of its business strategy, the Company will evaluate new acquisition
opportunities. Acquisitions involve numerous risks, including difficulties in
the assimilation of the operations and products or services of the acquired
companies, the expenses incurred in connection with the acquisition and
subsequent assimilation of operations and products or services, the diversion of
management's attention from other business concerns and the potential loss of
key employees of the acquired company. Acquisitions of companies outside the
United States also may involve the additional risks of assimilating differences
in international business practices and overcoming language differences as well
as the risks inherent in conducting international business, including exposure
to currency fluctuations, difficulties in complying with a variety of foreign
laws, unexpected changes in regulatory requirements, difficulties in staffing
and managing foreign operations and potentially adverse tax consequences. There
can be no assurance that the Company will successfully identify, complete or
integrate any future acquisitions, or that acquisitions, if completed, will
contribute favorably to the Company's operations and future financial condition.
The Company may also face increased competition for acquisition opportunities,
which may inhibit the Company's ability to consummate suitable acquisitions on
terms favorable to the Company. See 'Use of Proceeds' and 'Business -- Growth
Strategy.'
 
UNSPECIFIED USE OF PROCEEDS
 
     None of the net proceeds that the Company will receive from this Offering
have been designated for any specific purpose. As a consequence, the Company's
management will have broad discretion with respect to the use of such proceeds.
The principal purposes of the Offering are to obtain additional working capital
for business expansion purposes, investment in infrastructure, to facilitate the
Company's access to public equity markets and to enhance the Company's ability
to use its Common Stock as consideration for possible acquisitions and as a
means of attracting and retaining key employees. Net proceeds from this Offering
will also be available for general corporate purposes, including replenishment
of working capital used to make the final distribution to the Company's existing
shareholders. A portion of the net proceeds may also be used to acquire or
invest in complementary businesses, products or services; however, there are no
commitments or agreements with respect to any such transaction at the present
time. See 'Use of Proceeds,' 'Dividend Policy' and 'S Corporation Termination.'
 
NO PRIOR TRADING MARKET; POTENTIAL VOLATILITY OF STOCK PRICE
 
     Prior to the Offering, there has been no public market for the Common
Stock, and there can be no assurance that an active trading market for the
Common Stock will develop or, if one does develop, that it will be maintained.
The initial public offering price, which will be established by negotiations
between the Company and representatives of the Underwriters, may not be
indicative of prices that will prevail in the trading market for the Common
Stock. The market price of the Common Stock could be subject to wide
fluctuations in response to variations in operating results from quarter to
quarter, changes in earnings estimates by analysts, market conditions in the
industry and general economic conditions. Furthermore, the stock market has
experienced significant price and volume fluctuations unrelated to the operating
performance of particular companies. These market fluctuations may have an
adverse effect on the market price of the Common Stock. See 'Underwriters.'
 
SHARES ELIGIBLE FOR FUTURE SALE
 
     Sales of substantial amounts of the Common Stock of the Company in the
public market, or the prospect of such sales, could have a material adverse
effect on the market price of the Common Stock. Immediately following the
Offering, the Company will have outstanding _______ shares of Common Stock
(excluding ______ shares reserved for issuance upon the exercise of outstanding
stock options). The _______ shares of Common Stock offered hereby (________ if
the Underwriters' over-allotment option is exercised in full) will be eligible
for public sale without restriction under the Securities Act of 1933, as amended
(the 'Securities Act') by persons other than 'affiliates' (as that term is
defined in Rule 144 under the Securities Act) of the Company. All of the
remaining ________ shares of Common Stock outstanding will be 'restricted
securities' within the meaning of Rule 144 and may not be resold in the absence
of registration under the Securities Act or pursuant to exemptions from such
registration including, among others, the exemption provided by Rule 144 under
the Securities Act. Taking into consideration the effect of the 180-day
'lock-up' agreements covering all of the restricted shares and options to
purchase an additional _______shares held by executive officers, such restricted
shares will be eligible for sale upon the expiration of the lock-up agreements,
subject to the provisions of Rule 144 or Rule 701 under the Securities Act.
 
                                       11

<PAGE>
     The Company intends to register on Form S-8 under the Securities Act as
soon as practicable after the effective date of the Offering, ______ shares of
Common Stock issued or reserved for issuance under the Company's 1998 Stock
Option Plan. This registration will be effective upon filing. As of December 31,
1997, there were outstanding options for the purchase of ______ shares of Common
Stock. Shares registered and issued pursuant to such registration statement will
be freely tradable except to the extent that the holders thereof are deemed to
be 'affiliates' of the Company, in which case the transferability of such shares
will be subject to the volume limitations set forth in Rule 144 under the
Securities Act. See 'Management -- 1998 Stock Option Plan,' 'Description of
Capital Stock,' 'Shares Eligible for Future Sale' and 'Underwriting.'
 
IMMEDIATE AND SUBSTANTIAL DILUTION
 
     The purchasers of shares of Common Stock pursuant to the Offering will
experience immediate and substantial dilution of the net tangible book value per
share of Common Stock from the initial public offering price. At the initial
public offering price of $____ per share, purchasers in the Offering will incur
dilution of $____ per share. Additional dilution is also likely to occur upon
exercise of options granted by the Company. See 'Dilution.'
 
NO DIVIDENDS
 
     Except for a final distribution to its shareholders immediately prior to
the Offering, the Company does not expect to declare or pay any dividends in the
foreseeable future. Instead, the Company intends to retain all earnings, if any,
in order to expand its operations. The payment of dividends, if any, in the
future is within the discretion of the Company's Board of Directors and will
depend upon the Company's earnings, if any, its capital requirements and
financial condition and other relevant factors. See 'Dividend Policy' and 'S
Corporation Termination.'
 
ANTI-TAKEOVER EFFECTS OF CERTAIN CHARTER, BYLAW AND OTHER PROVISIONS
 
     The Company's Board of Directors is authorized to issue up to 5,000,000
shares of Preferred Stock and to determine the price, rights, preferences and
privileges of those shares without any further vote or action by the Company's
shareholders. The rights of the holders of Common Stock will be subject to, and
may be adversely affected by, the rights of the holders of any shares of
Preferred Stock that may be issued in the future. While the Company has no
present intention to issue shares of Preferred Stock, such issuance, while
providing desirable flexibility in connection with possible acquisitions and
other corporate purposes, could have the effect of making it more difficult for
a third party to acquire a majority of the outstanding voting stock of the
Company. In addition, such Preferred Stock may have other rights, including
economic rights senior to the Common Stock, and, as a result, the issuance
thereof could have a material adverse effect on the market value of the Common
Stock. The Certificate of Incorporation provides for a classified Board of
Directors and members of the Board of Directors may be removed only for cause
upon the affirmative vote of holders of at least a majority of the shares of
capital stock of the Company entitled to vote. Furthermore, the Company is
subject to the anti-takeover provisions of Section 203 of the Delaware General
Corporation Law (the 'DGCL'), which prohibits the Company from engaging in a
'business combination' with an 'interested stockholder' for a period of three
years after the date of the transaction in which such person first becomes an
'interested stockholder,' unless the business combination is approved in a
prescribed manner. The application of these provisions could have the effect of
delaying or preventing a change of control of the Company. Certain other
provisions of the Certificate of Incorporation could also have the effect of
delaying or preventing changes of control or management of the Company, which
could adversely affect the market price of the Company's Common Stock. See
'Description of Capital Stock. '
 
                                       12

<PAGE>
                                USE OF PROCEEDS
 
     The net proceeds to the Company from the sale of the ______ shares of
Common Stock being offered by the Company hereby are estimated to be $___
million ($____ million if the Underwriters' over-allotment option is exercised
in full), after deducting the underwriting discount and commissions and
estimated offering expenses payable by the Company. The principal purposes of
the offering of shares by the Company are to obtain additional working capital
for business expansion purposes investment in infrastructure, to facilitate the
Company's access to the public equity markets and to enhance the Company's
ability to use its Common Stock as consideration for possible acquisitions and
as a means of attracting and retaining key employees. Net proceeds from this
Offering will also be available for general corporate purposes, including
replenishment of working capital used to make the final distribution to the
Company's existing shareholders immediately prior to this Offering. A portion of
the net proceeds may also be used to acquire or invest in complementary
businesses, products or services; however, there are no commitments or
agreements with respect to any such transaction at the present time. Pending use
of the net proceeds for the above purposes, the Company intends to invest such
funds in short-term, interest-bearing, investment-grade obligations. See
'Dividend Policy.'
 
                                DIVIDEND POLICY
 
     The Company does not expect to declare or pay any cash or stock dividends
on its Common Stock in the foreseeable future and intends to retain future
earnings for the expansion of its business. Any future determination to pay cash
dividends will be at the discretion of the Company's Board of Directors and will
depend upon, among other things, the Company's results of operations, financial
condition, contractual restrictions and such other factors deemed relevant by
the Board.
 
     Historically, as an S Corporation, the Company has made special bonus
compensation payments to its shareholders based on its estimated profitability
and working capital requirements. Immediately prior to this Offering, the
Company will declare a final distribution estimated to be $___________ million
to its existing shareholders reflecting the aggregate shareholders' equity as of
the date of such distribution. Investors purchasing Common Stock in this
Offering will not receive any portion of such distribution and the Company will
not make any additional distributions of this kind in the future. See 'Use of
Proceeds' and 'S Corporation Termination.'
 
                           S CORPORATION TERMINATION
 
     The Company has been treated as an S Corporation for Federal income tax
purposes since January 1, 1991 and for purposes of the tax laws of the State of
New Jersey since January 1, 1994. As a result, the income of the Company has
been taxed at the shareholder level. Concurrent with the completion of this
Offering, the Company's S Corporation election will be terminated and the
Company will be subject to Federal and state corporate income taxation as a C
Corporation.
 
                                       13

<PAGE>
                                 CAPITALIZATION
 
     The following table sets forth the capitalization of the Company at
December 31, 1997 and as adjusted to reflect (i) the sale by the Company of
_______ shares of Common Stock in the Offering at the initial public offering
price of $__________ per share, after deducting underwriting discounts and
commissions and estimated expenses, and application of the estimated net
proceeds thereof and (ii) the final distribution to the Company's shareholders
immediately prior to the Offering. This table should be read in conjunction with
the Company's audited Financial Statements, including the notes thereto, which
appear elsewhere in this Prospectus.
 
<TABLE>
<CAPTION>
                                                                                                  AS OF
                                                                                            DECEMBER 31, 1997
                                                                                         ------------------------
                                                                                          ACTUAL      AS ADJUSTED
                                                                                         --------     -----------
                                                                                              (IN THOUSANDS)
<S>                                                                                      <C>          <C>
Long-term obligations, less current portion..........................................    $     --      $      --
Shareholders' equity.................................................................
  Preferred shares, $.01 par value, 5,000,000 shares authorized;
     no shares issued and outstanding................................................          --             --
  Common shares, $.01 par value, 30,000,000 shares authorized;
     _________ issued and outstanding actual; ________ issued and
     outstanding, as adjusted(1).....................................................
  Additional paid-in capital.........................................................       4,194
  Retained earnings..................................................................      (3,416)
  Deferred Compensation..............................................................        (102)
                                                                                         --------     -----------
  Total shareholders' equity.........................................................
Total capitalization.................................................................    $             $
                                                                                         --------     -----------
                                                                                         --------     -----------
</TABLE>
 
------------------
 
(1) Excludes (i) _____ shares of Common Stock issuable upon exercise of stock
    options outstanding on December 31, 1997 at a weighted average exercise
    price of $_______ per share and (ii) ______ additional shares of Common
    Stock reserved for future grants under the Company's 1998 Stock Option Plan.
    See 'Management -- 1998 Stock Option Plan.'
 
                                       14

<PAGE>
                                    DILUTION
 
     At December 31, 1997, the net tangible book value of the Company was $__
million, and the pro forma net tangible book value per share of Common Stock was
$________ (after giving effect to the final distribution estimated to be $______
million and the estimated $______ of deferred income tax benefits arising upon
termination of the Company's S Corporation status). See 'Dividend Policy' and 'S
Corporation Termination' and note 14 to the Company's Financial Statements.
After giving effect to the sale by the Company of _______ shares of Common Stock
in the Offering at the initial public offering price of $_______ per share and
after deducting underwriting discounts and commissions and estimated offering
expenses payable by the Company, the pro forma net tangible book value of the
Company at December 31, 1997 would have been $___ million or $____ per share.
This represents an immediate increase in net tangible book value of $____ per
share to existing shareholders of the Company and an immediate dilution of
$______ per share to new investors purchasing shares in this Offering.
 
     The following table illustrates such per share dilution:
 
<TABLE>
<S>                                                                              <C>         <C>
The initial public offering price per share..............................................     $
Pro forma net tangible book value per share before the Offering (1)...........   $
Increase per share attributable to new investors..............................   $
Pro forma net tangible book value per share after the Offering...........................     $
Dilution per share to new investors (2)..................................................     $
</TABLE>
 
------------------
 
(1) Pro forma net tangible book value per share of Common Stock is determined by
    dividing the Company's net tangible book value at December 31, 1997 of
    $_____ million by the pro forma number of shares of Common Stock
    outstanding.
 
(2) Dilution per share to new investors is determined by subtracting pro forma
    net tangible book value per share after the Offering from the initial public
    offering price per share.
 
     The computations in the table above exclude: (i) ______ shares of Common
Stock issuable upon the exercise of stock options outstanding at December 31,
1997 at a weighted average exercise price of $________ per share and (ii) _____
additional shares of Common Stock reserved for future grants under the Company's
1998 Stock Option Plan. See 'Management -- 1998 Stock Option Plan.'
 
                                       15

<PAGE>
                            SELECTED FINANCIAL DATA
 
     The selected financial data set forth below for the five years ended
December 31, 1993, 1994, 1995, 1996 and 1997 have been derived from the
Company's Financial Statements and the notes thereto. Balance sheets at December
31, 1996 and 1997 and the statements of income, of shareholders' equity and of
cash flows for the three years ended December 31, 1995, 1996 and 1997 and notes
thereto appear elsewhere in this Prospectus and have been audited by Coopers &
Lybrand L.L.P., independent accountants. The selected financial data for the
years ended December 31, 1993 and 1994 have been derived from the Company's
unaudited Financial Statements which have been prepared by the Company in
accordance with generally accepted accounting principles and includes all
adjustments that management considers necessary for a fair presentation of the
data for such periods. The Company's unaudited Financial Statements for the
years ended December 31, 1993 and 1994 have not been included in this
Prospectus. The selected financial data set forth below should be read in
conjunction with, and are qualified by reference to 'Management's Discussion and
Analysis of Financial Condition and Results of Operations' and the Company's
audited Financial Statements and related notes appearing elsewhere in this
Prospectus.
 
STATEMENT OF OPERATIONS DATA:
 
<TABLE>
<CAPTION>
                                                                          YEAR ENDED DECEMBER 31,
                                                           -----------------------------------------------------
                                                            1993       1994       1995        1996        1997
                                                           ------     ------     -------     -------     -------
                                                           (IN THOUSANDS, EXCEPT PER SHARE AND STATISTICAL DATA)
 
<S>                                                        <C>        <C>        <C>         <C>         <C>
Revenue................................................    $8,226     $8,250     $18,398     $33,015     $54,542
Program expenses.......................................     4,886      5,339      15,427      26,886      43,057
                                                           ------     ------     -------     -------     -------
Gross profit...........................................     3,340      2,911       2,971       6,129      11,485
Compensation expense...................................     1,945      1,673       2,124       3,191       5,121(1)
Bonus to majority shareholder(2).......................       440        200         425       1,500       2,243
Stock grant expense(3).................................        --         --          --          --       4,470
Other general, selling and administrative expenses.....       844        826       1,159       1,650       2,755
                                                           ------     ------     -------     -------     -------
Total general, selling and administrative expenses.....     3,229      2,699       3,708       6,341      14,589
                                                           ------     ------     -------     -------     -------
Operating income (loss)................................       111        212        (737)       (212)     (3,104)
Other income, net......................................        17         16          70          98         155
                                                           ------     ------     -------     -------     -------
Income (loss) before provision for taxes...............       128        228        (667)       (114)     (2,949)
Pro forma provision for (benefit from) income
  taxes(4).............................................        51         91        (121)         --          --
                                                           ------     ------     -------     -------     -------
Pro forma net income (loss)(4).........................    $   77     $  137     $  (546)    $  (114)    $(2,949)
                                                           ------     ------     -------     -------     -------
                                                           ------     ------     -------     -------     -------
Pro forma net income (loss) per share(4)...............
                                                                                                         -------
                                                                                                         -------
Pro forma weighted average number of shares
  outstanding..........................................
                                                                                                         -------
                                                                                                         -------
</TABLE>
 
OTHER FINANCIAL DATA:
 
<TABLE>
<S>                                                        <C>        <C>        <C>         <C>         <C>
Adjusted operating income (loss)(5)....................    $  551     $  412     $  (312)    $ 1,288     $ 3,609
Adjusted net income (loss)(4)(5).......................       341        257        (145)        832       2,258
</TABLE>
 
OTHER OPERATING DATA:
 
<TABLE>
<S>                                                        <C>        <C>        <C>         <C>         <C>
Number of detail programs..............................         8          9          10          13          15
Number of clients......................................         6          7           7           8          12
Average size of detail program.........................    $1,028     $  917     $ 1,840     $ 2,540     $ 3,636
Number of sales representatives at end of period:
  Full-time............................................        --         --          --          29         633
  Part-time............................................       107        107         393         709         362
                                                           ------     ------     -------     -------     -------
  Total................................................       107        107         393         738         995
                                                           ------     ------     -------     -------     -------
                                                           ------     ------     -------     -------     -------
</TABLE>
 
                                                 See footnotes on following page
 
                                       16

<PAGE>
BALANCE SHEET DATA:
 
<TABLE>
<CAPTION>
                                                                                    AS OF DECEMBER 31,
                                                                      -----------------------------------------------
                                                                       1993      1994      1995      1996      1997
                                                                      ------    ------    ------    ------    -------
                                                                                      (IN THOUSANDS)
<S>                                                                   <C>       <C>       <C>       <C>       <C>
Cash and cash equivalents..........................................   $1,701    $  611    $  240    $2,403    $ 5,760
Working capital....................................................      (63)      130      (591)     (873)       129
Total assets.......................................................    2,243     6,975     5,881     8,322     13,691
Total long-term debt...............................................       --        --        --        --         --
Shareholders' equity (deficit).....................................       76       304      (363)     (478)       676
</TABLE>
 
------------------
 
(1) Includes bonus compensation of $237,000 paid to Charles T. Saldarini, the
    Company's President, Chief Executive Officer and a minority shareholder. It
    is expected that, in addition to his base salary, Mr. Saldarini may receive
    cash bonuses in future periods as determined by the Compensation Committee.
    See 'Management -- Executive Compensation.'
 
(2) The Company has been treated as an S Corporation under subchapter S of the
    Code since January 1, 1991 and under the corresponding provisions of the tax
    laws of the State of New Jersey since January 1, 1994. Historically, as an S
    Corporation, the Company made annual bonus payments to its majority
    shareholder based on the Company's estimated profitability and working
    capital requirements. With the exception of the distribution to be declared
    immediately prior to the Offering, the Company does not expect to pay such
    bonuses in future periods. See 'Dividend Policy.'
 
(3) On January 1, 1997, the Company issued shares of its Common Stock to Charles
    T. Saldarini, its current President and Chief Executive Officer. As a
    result, prior to the Offering, Mr. Saldarini owns 15.0% of the Common Stock
    outstanding. For financial accounting purposes, a non-recurring, non-cash
    compensation expense was charged in the first quarter of 1997. See
    'Principal Shareholders,' 'Management,' 'Certain Transactions' and note 12
    to the Company's Financial Statements.
 
(4) As an S Corporation, the Company has not been subject to Federal or New
    Jersey corporate income taxes, other than a New Jersey state corporate
    income tax of approximately 2%. Rather, the income of the Company has been
    taxed at the shareholder level. Upon consummation of this Offering, the
    Company will no longer be treated as an S Corporation, and, accordingly,
    will be subject to Federal and state corporate income taxes. Pro forma
    provision for income taxes, net income, net income per share and adjusted
    net income for all periods presented reflect a provision for income taxes as
    if the Company had been taxed as a C Corporation for all periods.
 
(5) Adjusted to eliminate bonus to majority shareholder and stock grant expense.
    This presentation illustrates the Company's results of operations on an
    adjusted basis to reflect that the Company does not intend to pay bonuses to
    its majority shareholder or incur stock grant expense in future periods.
    These presentations should not be construed as an alternative to operating
    income or net income/(loss) (as determined in accordance with generally
    accepted accounting principles) as presented herein.
 
                                       17

<PAGE>
                    MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                 FINANCIAL CONDITION AND RESULTS OF OPERATIONS
 
     The following Management's Discussion and Analysis of Financial Condition
and Results of Operations should be read in conjunction with the Company's
Financial Statements and the notes thereto appearing elsewhere in this
Prospectus and contains trend analysis and other forward-looking statements that
involve substantial risks and uncertainties. The Company's actual results could
differ materially from those expressed or implied in the forward-looking
statements as a result of certain factors, including those set forth under 'Risk
Factors' and elsewhere in this Prospectus.
 
OVERVIEW
 
     The Company is a leading provider of comprehensive customized solutions on
an outsourced basis to the United States pharmaceutical industry. The Company
believes it has achieved this leadership position based on its 10 years of
industry experience and its relationships with many of the pharmaceutical
industry's largest companies. Since inception, the Company has designed
customized product detailing programs for approximately 25 clients, including
Pfizer, Inc., Astra Merck Inc., Glaxo Wellcome Inc. and Johnson & Johnson, Inc.
Such programs have been designed to promote more than 70 different products,
including such leading prescription medications as Prilosec(Registered),
Wellbutrin(Registered) and Cardura(Registered), as well as a number of
well-known OTC products such as Bayer(Registered) Aspirin, Pepcid AC(Registered)
and Monistat 5(Registered), to hospitals, pharmacies and physicians in
approximately 20 different specialties. The Company's primary objective is to
enhance its leadership position in the growing CSO industry and to become the
premier supplier of comprehensive sales solutions to the pharmaceutical industry
and other segments of the healthcare market.
 
     The Company has demonstrated strong internal growth generated by securing
new business from leading pharmaceutical companies and by renewing and expanding
programs with existing clients. The Company believes that it is one of the
largest CSOs operating in the United States measured both by revenue and number
of sales representatives used in programs. Revenue increased from $8.3 million
in 1994 to $54.5 million in 1997, a compounded annual growth rate of
approximately 87.7%. Gross profit increased from $2.9 million in 1994 to $11.5
million in 1997, a compounded annual growth rate of 58.0%. In addition, the
number of sales representatives (part-time and full-time) employed by the
Company has increased from approximately 100, as of December 31, 1993 to
approximately 1,000 as of December 31, 1997. Over that same period, the
Company's mix between part-time and full-time representatives shifted from 100%
part-time to 45% part-time. At December 31, 1997 the Company was in the process
of hiring in excess of 150 new sales representatives to meet its obligations
under new and existing programs.
 
     Historically, the Company has derived a significant portion of program
revenue from a limited number of major clients. In 1995, the Company's four
largest clients accounted for approximately 42%, 17%, 15% and 10%, respectively,
or a total 84%, of its revenue. In 1996, the Company's four largest clients
accounted for approximately 30%, 21%, 17% and 16%, respectively, or a total 84%,
of its revenue. In 1997, the Company's four largest clients accounted for
approximately 25%, 22%, 19% and 10%, respectively, or a total 76%, of its
revenue. Concentrations of business in the CSO industry are not uncommon and the
Company believes that pharmaceutical companies will continue to outsource larger
projects as the CSO industry grows and continues to demonstrate an ability to
successfully implement large programs. Accordingly, the Company is likely to
continue to experience significant client concentration in future periods.
 
     The Company is engaged by its clients to design and implement product
detailing programs for both prescription and OTC pharmaceutical products. Given
the customized nature of the Company's business, it utilizes a variety of
contract structures with its clients. Generally, contracts provide for a fee to
be paid based on the Company delivering a specified package of services.
Contracts typically include performance benchmarks, such as a minimum number of
sales representatives or a minimum number of calls. Under certain contracts, the
Company may be entitled to additional compensation based upon the success of the
program and/or subject to penalties for failing to meet stated performance
benchmarks. The Company typically receives a portion of its fee upon
commencement of the program to reflect the costs of implementing such program.
In addition, contracts typically provide that the Company is entitled to a fee
for each sales representative hired by the client during or at the conclusion of
a program.
 
     The Company's contracts generally are for terms of six months to one year
and are subject to renewal upon expiration. These contracts are terminable by
the client for any reason upon 30 to 90 days notice. The Company's contracts
typically provide for termination payments by the client upon a termination
without cause. While the 
 
                                       18

<PAGE>
cancellation of certain of the Company's contracts by a client without cause may
result in the imposition of penalties on such client, such penalties may not act
as an adequate deterrent to the termination of any such contracts. In addition,
there can be no assurance that such penalties will offset the lost revenue or
the costs incurred by the Company as a result of the termination of such
contracts. Despite such payments, the loss or termination of one or more
contracts could adversely affect the Company's future revenue and profitability.
Contracts may also be terminated for cause based on, among other things, the
Company's failure to meet stated performance benchmarks. In such event, the
Company may be obligated to pay penalties. To date, no programs have been
terminated for cause.
 
     Generally, the Company recognizes revenue under the percentage of
completion method pursuant to which revenue is recorded as costs are incurred.
Revenue includes estimated earned fees or profits and is calculated based on the
relationship between direct program costs actually incurred, other than initial
direct program costs (as described below), and the estimated total of such
costs. Program costs consist of costs associated with the execution of a
detailing program. There are two significant categories of program costs:
personnel costs and initial direct program costs. Personnel costs, which
consititute the largest portion of program expenses, include all labor related
costs, such as salaries, bonuses, fringe benefits and payroll taxes for the
sales representatives and managers who are directly responsible for the
rendering of services in connection with a particular program. Initial direct
program costs are those costs associated with the recruitment and training of
the sales representatives in connection with a particular program, and are
deferred and recognized over the life of such program.
 
     Estimated revenue and program costs are reviewed and revised periodically
throughout the life of each program. Any adjustment to a program's revenue
resulting from such revisions is recorded on a cumulative basis in the period in
which the revisions are made. In the period in which it is determined that a
loss will result from the performance of a program, or that the Company will
incur a penalty in connection with such program, the entire amount of the
estimated ultimate loss or penalty is charged against such program's revenue.
The Company manages program expenses by carefully establishing and monitoring
program budgets and timetables and by closely tracking staffing requirements for
programs in progress and anticipated programs. The status of each program in
progress is reviewed regularly by program managers and senior management to
ensure client satisfaction and to monitor performance relative to internal
financial and operating expectations. The number of sales representatives
assigned to a program varies according to the size, complexity, duration and
demands of the program.
 
     General, selling and administrative expense include compensation expense,
bonus to majority shareholder, stock grant expense and other general, selling
and administrative expenses. Compensation expense consists primarily of salaries
and related fringe benefits for senior management and other administrative,
marketing, finance, information technology and human resources personnel who are
not directly involved with the execution of a particular program. Bonus to
majority shareholder reflects the cash bonus paid to the Company's majority
shareholder and Chairman of the Board, John P. Dugan. With the exception of the
final distribution declared immediately prior to the Offering, it is not
expected that the Company will pay bonuses to Mr. Dugan in any future periods.
See 'Dividend Policy.' Stock grant expense reflects the non-cash, non-recurring
charges related to the grant of _____ shares of Common Stock to the Company's
President and Chief Executive Officer, Charles T. Saldarini. As a result, prior
to the Offering, Mr. Saldarini owns 15.0% of the issued and outstanding Common
Stock of the Company. Finally, other general, selling and administrative
expenses include corporate overhead such as facilities costs, depreciation and
amortization expenses and professional services fees. The Company plans to
relocate to a new leased facility by the end of the second quarter of 1998 to
accommodate its growth. The Company anticipates increased rent and certain
one-time costs associated with such relocation. General, selling and
administrative expenses (excluding bonus to majority shareholder and stock grant
expense) as a percentage of revenue have generally declined as the Company has
spread its overhead expenses across its expanding revenue base. The Company
anticipates that general, selling and administrative expenses will continue to
decline as a percentage of revenue as its business grows, although such expenses
are expected to increase on an absolute basis.
 
     Prior to 1995, no single program implemented by the Company required more
than 60 sales representatives. At the end of 1994, the Company entered into an
agreement for a program that required in excess of 150 sales representatives.
The Company believes that this represented the beginning of a trend in the
industry towards larger programs. In order to meet the demands of this program
and future programs, both in terms of increased number of sales representatives
and the additional administrative requirements attendant thereto, the Company 
 
                                       19

<PAGE>
made a significant investment in hiring additional administrative and management
personnel for recruiting, hiring and improving its management information
systems. As a result of these additional expenditures, the Company recorded an
operating loss in 1995. However, the additional investment in infrastructure and
information technology has enabled the Company to continue to pursue larger
contracts, which has accounted for a substantial portion of the Company's growth
beginning in 1995. The Company will continue to make such investments in future
years to maintain its high standards of quality and operating efficiency.
 
     The Company has been treated as an S Corporation for Federal income tax
purposes since January 1, 1991 and for New Jersey state income tax purposes
since January 1, 1994. Accordingly, the Company's income has been taxed directly
at the shareholder level rather than at the corporate level. Concurrent with the
completion of this Offering, the Company's S Corporation election will terminate
and the Company will be subject to corporate income taxation as a C Corporation.
For each of the periods in which the Company was an S Corporation, the statement
of income data in the 'Selected Financial Data' table reflects a provision for
income taxes on a pro forma basis as if the Company had been taxed as a C
Corporation during such periods.
 
RESULTS OF OPERATIONS
 
     The following table sets forth for the periods indicated, certain statement
of operations data as a percentage of revenue. The trends illustrated in this
table may not be indicative of future results.
 
<TABLE>
<CAPTION>
                                                                                YEAR ENDED DECEMBER 31,
                                                                         --------------------------------------
                                                                         1994       1995       1996       1997
                                                                         -----      -----      -----      -----
<S>                                                                      <C>        <C>        <C>        <C>     <C>
Revenue...............................................................   100.0%     100.0%     100.0%     100.0%
Program expenses......................................................    64.7       83.9       81.4       78.9
                                                                         -----      -----      -----      -----
Gross profit..........................................................    35.3       16.1       18.6       21.1
Compensation expense..................................................    20.3       11.5        9.7        9.4
Bonus to majority shareholder.........................................     2.4        2.3        4.5        4.1
Stock grant expense...................................................     0.0        0.0        0.0        8.2
Other general, selling and administrative expenses....................    10.0        6.3        5.0        5.0
                                                                         -----      -----      -----      -----
Total general, selling and administrative expenses....................    32.7       20.1       19.2       26.7
                                                                         -----      -----      -----      -----
Operating income (loss)...............................................     2.6       (4.0)      (0.6)      (5.6)
Other income, net.....................................................     0.2        0.4        0.3        0.3
                                                                         -----      -----      -----      -----
Income (loss) before provision for taxes..............................     2.8       (3.6)      (0.3)      (5.3)
Pro forma provision for (benefit from) income taxes...................     1.1       (0.6)       0.0        0.0
                                                                         -----      -----      -----      -----
Pro forma net income (loss)...........................................     1.7%      (3.0)%     (0.3)%     (5.3)%
                                                                         -----      -----      -----      -----
                                                                         -----      -----      -----      -----
</TABLE>
 
YEARS ENDED DECEMBER 31, 1997 AND 1996
 
     Revenue.  Revenue for 1997 was $54.5 million, an increase of 65.2% over
1996 revenue of $33.0 million. Revenue in 1997 was generated from 15 programs
for 12 clients while 1996 revenue was generated from 13 programs for eight
clients. Average program size increased to $3.6 in 1997 from $2.5 in 1996.
Approximately $46.9 million, or 85.9% of 1997 revenue, was derived from seven
clients; those seven clients generated $31.0 million, or approximately 93.8% of
1996 revenue.
 
     Program expenses.  Program expenses for 1997 were $43.1 million, an
increase of 60.1% over program expenses of $26.9 million for 1996. As a
percentage of revenue, program expenses decreased to 78.9% for 1997 from 81.4%
for 1996. This decrease was primarily attributable to the Company continuing to
realize efficiencies as a result of the investments in infrastructure and
process improvements which were implemented in 1995 and 1996.
 
     Compensation expense.  Compensation expense for 1997 was $5.1 million
compared to $3.2 million for 1996. This increase was due to an increase in the
number of management and administrative personnel in 1997 over the 1996 number
necessitated by the expansion of the Company's business. As a percentage of
revenue, compensation expense was 9.4% for 1997 compared to 9.7% for 1996.

     Bonus to majority shareholder.  Bonus to majority shareholder for 1997 was
$2.2 million compared to $1.5 million for 1996.
 
                                       20

<PAGE> 
     Stock grant expense.  In the first quarter of 1997, the Company incurred
non-recurring, non-cash charges of $4.5 million related to stock issued to
Charles T. Saldarini, the Company's President and Chief Executive Officer.
 
     Other general, selling and administrative expenses.  Other general, selling
and administrative expenses were $2.8 million for 1997, an increase of 67.0%
over other general, selling and administrative expenses of $1.7 million for
1996. As a percentage of revenue, other general, selling and administrative
expenses were 5.0% for 1997 and 1996.
 
     Operating loss.  Loss from operations for 1997 was $3.1 million compared to
$212,000 for 1996. Before bonus to majority shareholder and stock grant expense,
operating income for 1997 was $3.6 million or 6.6% of revenue, compared to $1.3
million, or 3.9% of revenue, for 1996.
 
     Other income, net.  Other income, primarily net interest income, for 1997
was $155,000, an increase of 58.2% over net other income of $98,000 for 1996,
due to the greater availability of funds for investment.
 
     Pro forma net loss.  Pro forma net loss for 1997 was $2.9 million compared
to a pro forma net loss of $114,000 for 1996. Pro forma net loss for both
periods assumes the Company was taxed for Federal and state income tax purposes
as a C Corporation, with no tax benefits assumed for the net operating losses in
1997 and 1996.
 
YEARS ENDED DECEMBER 31, 1996 AND 1995
 
     Revenue.  Revenue for 1996 was $33.0 million, an increase of 79.4% over
1995 revenue of $18.4 million. Revenue in 1996 was generated from 13 programs
for eight clients while 1995 revenue was generated from 10 programs for seven
clients. Average program size increased to $2.5 million in 1996 from $1.8
million in 1995. Substantially all of 1996 revenue, or 99.3%, was derived from
clients that accounted for $17.8 million, or 97.0%, of 1995 revenue.
 
     Program expenses.  Program expenses for 1996 were $26.9 million, an
increase of 74.3% over program expenses of $15.4 million for 1995. As a
percentage of revenue, however, program expenses decreased to 81.4% in 1996 from
83.9% in 1995. This decrease was primarily attributable to the Company beginning
to realize operating efficiencies as a result of the investments in
infrastructure and process improvement begun in 1995.
 
     Compensation expense.  Compensation expense in 1996 was $3.2 million
compared to $2.1 million in 1995. This increase was attributable to an increase
in the number of management and administrative personnel employed by the Company
in 1996 as compared to 1995 necessitated by the expansion of the Company's
business. As a percentage of revenue, compensation expense was 9.7% for 1996
compared to 11.5% for 1995.
 
     Bonus to majority shareholder.  Bonus to majority shareholder for 1996 was
$1.5 million compared to $425,000 for 1995.
 
     Stock grant expense.  There were no compensatory stock grants in either
period.
 
     Other general, selling and administrative expenses.  Other general, selling
and administrative expenses were $1.7 million in 1996 compared to $1.2 million
in 1995, an increase of 42.4%. As a percentage of revenue, other general,
selling and administrative expenses were 5.0% in 1996 compared to 6.3% in 1995.
 
     Operating loss.  Operating loss decreased to $212,000 in 1996 from $737,000
in 1995. Before bonus to majority shareholder, operating income in 1996 was $1.3
million compared to an operating loss of $312,000 in 1995.
 
     Other income, net.  Other income, primarily net interest income, was
$98,000 in 1996, an increase of 40.1% over other income of $70,000 in 1995, due
to the greater availability of funds for investment.
 
     Pro forma net loss.  Pro forma net loss for the year ended December 31,
1996 was $114,000 compared to $546,000 for the prior year. Pro forma net loss
for both periods assumes the Company was taxed for Federal and state income tax
purposes as a C Corporation, with no tax benefits assumed for the net operating
loss in 1996.
 
LIQUIDITY AND CAPITAL RESOURCES
 
     The Company's principal source of funds has been cash flow from operations.
Contracts generally provide for advance payments which typically fund the
initial costs of a program. To date, the Company's cash flow has been sufficient
to provide funds for working capital and capital expenditures.

     The Company has a $500,000 line of credit (the 'Credit Line') from a
commercial bank under which interest only is payable monthly on the outstanding
balance at a floating rate equal to 1% above the prime rate of 
 
                                       21

<PAGE>
interest as published from time to time by The Wall Street Journal. In addition,
the Company has obtained a commitment from the bank for a $1 million line of
credit, the proceeds of which are to be used exclusively for capital
expenditures (the 'CAPEX Line'). The CAPEX Line would be for a term of nine
months and would bear interest payable monthly at a floating rate of interest
equal to 0.75% above the prime rate of interest. At the end of the nine months,
any outstanding balance is payable in 60 equal monthly installments of principal
and interest computed at the rate of 0.75% above the prime rate on the date of
conversion. The Credit Line and the CAPEX Line will be secured by a lien on all
of the assets of the Company and will be personally guaranteed by John P. Dugan,
the Company's majority shareholder and Chairman of the Board. The notes
evidencing the Credit Line and the CAPEX Line and the related security
agreements will contain covenants, representations and other provisions
customarily found in commercial loan documentation.
 
     As of December 31, 1997, the Company had cash and cash equivalents of $5.8
million and working capital of $129,000. In addition, the Company paid a cash
bonus aggregating $2.2 million to its majority shareholder John P. Dugan in
1997. Immediately prior to this Offering, the Company anticipates that it will
distribute approximately $____ million to its existing shareholders. See
'Dividend Policy.'
 
     For the year ended December 31, 1997, the Company generated $3.4 million of
net cash from operating activities as compared to $2.8 million of net cash
generated during the prior year. The increase in cash flow occurred despite the
loss generated from operations due to the positive effect of non-cash expenses
for depreciation and the stock grant to Charles T. Saldarini. In January 1997,
the Company issued shares of its Common Stock to its President and Chief
Executive Officer, Charles T. Saldarini. As a result, prior to the Offering, Mr.
Saldarini owns 15% of the outstanding shares of Common Stock. Such issuance
resulted in non-recurring, non-cash charges for the first quarter of 1997 in the
amount of $4.5 million.
 
     For the years ended December 31, 1997 and 1996, net cash used in investing
activities was $94,000 and $641,000, respectively. The primary use of cash in
both years was for investment in computer equipment in connection with the
expansion of the Company's business and in connection with advances to Boomer &
Son, Inc., a corporation that prior to 1998 was wholly-owned by John P. Dugan,
the Company's Chairman of the Board. See 'Certain Transactions.'
 
     Net cash provided by financing activities was $79,000 in 1997 as a result
of a $100,000 equipment loan provided by a commercial financial institution, net
of repayments. The Company expects to repay the balance of this loan in 1998.
There were no financing activities in 1996 or 1995.
 
     The Company has budgeted approximately $1.2 million for capital
expenditures in 1998, to be funded through cash generated from operations and
the CAPEX Line. During 1997, the Company's capital expenditures were $290,000.
 
     Where the Company bills clients for services before they have been
completed, billed amounts are recorded as billings in excess of costs, or
deferred revenue, and are recorded as income when earned. When services are
performed in advance of billing, the value of such services is recorded as
unbilled costs and accrued profits. As of December 31, 1997 and 1996, the
Company had $6.1 million and $3.9 million, respectively, of deferred revenue and
$5.0 million and $2.4 million, respectively, of unbilled costs and accrued
profits. Substantially all deferred and unbilled costs and accrued profits are
earned or billed, as the case may be, within 12 months of the end of the
respective period.
 
     The Company believes that the net proceeds from the sale of the Common
Stock offered hereby, together with cash flows from operations and existing cash
balances will be sufficient to meet its working capital and capital expenditure
requirements for the foreseeable future.
 
QUARTERLY RESULTS
 
     The Company's results of operations have been and are expected to be
subject to quarterly revenue fluctuations. Such fluctuations result from a
number of factors including, among other things, the timing of commencement,
completion or cancellation of major programs. In the future, revenue may
fluctuate as a result of such factors and a number of additional factors,
including delays or costs associated with acquisitions, government regulatory
initiatives and conditions in the healthcare industry generally. The Company
believes that because of such fluctuations, quarterly comparisons of its
financial results cannot be relied upon as an indication of future performance.

     The following table sets forth unaudited quarterly operating results for
the eight quarters ended December 31, 1997. The Company believes that this
unaudited information has been prepared on the same basis 
 
                                       22

<PAGE>
as the annual Financial Statements and includes all adjustments consisting only
of normal, recurring adjustments, necessary for a fair presentation of the
information for the quarters presented, when read in conjunction with the
Company's Financial Statements and notes thereto included elsewhere in this
Prospectus.
 
QUARTERLY STATEMENT OF OPERATIONS DATA:
<TABLE>
<CAPTION>
                                                                       QUARTER ENDED
                                 ------------------------------------------------------------------------------------------
                                 MARCH 31,   JUNE 30,   SEPTEMBER 30,   DECEMBER 31,   MARCH 31,   JUNE 30,   SEPTEMBER 30,
                                   1996        1996         1996            1996         1997        1997         1997
                                 ---------   --------   -------------   ------------   ---------   --------   -------------
                                 (IN THOUSANDS)
<S>                              <C>         <C>        <C>             <C>            <C>         <C>        <C>
Revenue........................   $ 5,370     $7,289       $ 9,351        $ 11,005      $10,775    $ 12,501      $14,703
Program expenses...............     4,316      5,963         7,539           9,068        8,612      10,053       11,651
                                 ---------   --------       ------      ------------   ---------   --------   -------------
Gross profit...................     1,054      1,326         1,812           1,937        2,163       2,448        3,052
Compensation expense(1)........       700        762           872             857        1,303       1,218        1,261
Bonus to majority
  shareholder(2)...............       375        375           375             375          561         561          561
Stock grant expense(3).........        --         --            --              --        4,470          --           --
Other general, selling and
  administrative expenses......       328        317           365             640          681         638          743
                                 ---------   --------       ------      ------------   ---------   --------   -------------
Total general, selling and
  administrative expenses......     1,403      1,454         1,612           1,872        7,015       2,417        2,565
                                 ---------   --------       ------      ------------   ---------   --------   -------------
Operating income (loss)........      (349)      (128)          200              65       (4,852)         31          487
Other income...................        --          9            16              73           11          38           61
                                 ---------   --------       ------      ------------   ---------   --------   -------------
Net income (loss)..............   $  (349)    $ (119)      $   216        $    138      $(4,841)   $     69      $   548
                                 ---------   --------       ------      ------------   ---------   --------   -------------
                                 ---------   --------       ------      ------------   ---------   --------   -------------
 
<CAPTION>
 
                                 DECEMBER 31,
                                     1997
                                 ------------
 
<S>                              <C>
Revenue........................    $ 16,563
Program expenses...............      12,741
                                 ------------
Gross profit...................       3,822
Compensation expense(1)........       1,339
Bonus to majority
  shareholder(2)...............         560
Stock grant expense(3).........          --
Other general, selling and
  administrative expenses......         693
                                 ------------
Total general, selling and
  administrative expenses......       2,592
                                 ------------
Operating income (loss)........       1,230
Other income...................          45
                                 ------------
Net income (loss)..............    $  1,275
                                 ------------
                                 ------------
</TABLE>
 
------------------
(1) Compensation expense for 1997 includes bonus compensation of $237,000 paid
    to Charles T. Saldarini, the Company's President, Chief Executive Officer
    and a minority shareholder. It is expected that, in addition to his base
    salary, Mr. Saldarini may receive cash bonuses in future periods as
    determined by the Compensation Committee. See 'Management -- Executive
    Compensation.'
 
(2) Historically, as an S Corporation, the Company has made annual bonus
    payments to its majority shareholder based on its estimated profitability
    and working capital requirements. With the exception of the distribution to
    be declared immediately prior to the Offering, the Company does not expect
    to pay such bonuses in future periods. See 'Dividend Policy.'
 
(3) On January 1, 1997, the Company issued shares of its Common Stock to Charles
    T. Saldarini, its current President and Chief Executive Officer. As a
    result, prior to the Offering, Mr. Saldarini owns 15.0% of the Common Stock
    outstanding. For financial accounting purposes, a non-recurring, non-cash
    compensation expense was charged in the first quarter of 1997. See
    'Principal Shareholders,' 'Management,' 'Certain Transactions' and note 12
    to the Company's Financial Statements.
 
EFFECT OF NEW ACCOUNTING PRONOUNCEMENTS
 
     Statement of Financial Accounting Standards No. 130, Reporting
Comprehensive Income, was issued in June 1997 and is effective for fiscal years
beginning after December 15, 1997. This pronouncement establishes standards for
reporting and display of comprehensive income and its components in a full set
of general-purpose financial statements. The Company will adopt this
pronouncement in 1998 and does not expect its implementation will have a
material effect on the Company's Financial Statements as currently presented.
 
     Statement of Financial Accounting Standards No. 131, Disclosures About
Segments of an Enterprise and Related Information, was also issued in June 1997
and is effective for fiscal periods beginning after December 15, 1997. This
pronouncement establishes the way in which publicly held business enterprises
report information about operating segments in annual financial statements and
interim reports to shareholders. As the Company operates in a single business
segment the implementation of this standard is not expected to significantly
impact the Company's Financial Statements as currently presented.
 
                                       23

<PAGE>
                                    BUSINESS
 
INTRODUCTION
 
     The Company is a leading provider of comprehensive customized sales
solutions on an outsourced basis to the United States pharmaceutical industry.
The Company believes it has achieved this leadership position based on its 10
years of industry experience and its relationships with many of the
pharmaceutical industry's largest companies. Since inception, the Company has
designed customized product detailing programs for approximately 25 clients,
including Pfizer, Inc., Astra Merck Inc., Glaxo Wellcome Inc. and Johnson &
Johnson, Inc. These programs have been designed to promote more than 70
different products, including such leading prescription medications as
Prilosec(Registered), Wellbutrin(Registered) and Cardura(Registered), as well as
a number of OTC products such as Bayer(Registered) Aspirin, Pepcid
AC(Registered) and Monistat 5(Registered), to hospitals, pharmacies and
physicians in approximately 20 different specialties. The Company's primary
objective is to enhance its leadership position in the growing CSO industry and
to become the premier supplier of comprehensive sales solutions to the
pharmaceutical industry and other segments of the healthcare market.
 
     The Company is engaged by its clients on a contractual basis to design and
implement product detailing programs for both prescription and OTC
pharmaceutical products. Such programs typically include three phases: design,
execution and assessment. In the program design phase, the Company works with
the client to understand needs, define objectives, select targets and determine
appropriate staffing. Program execution involves recruiting, hiring, training
and managing a sales force, which performs detail calls promoting the particular
client's pharmaceutical products. Assessment, the last phase of the program,
involves measurement of sales force performance and program success relative to
the goals and objectives outlined in the program design phase.
 
     The Company has demonstrated strong internal growth generated by securing
new business from leading pharmaceutical companies and renewing and expanding
programs with existing clients. The Company believes that it is one of the
largest CSOs operating in the United States measured both by revenue and total
number of sales representatives used in programs. Revenue and gross profit grew
at compound annual rates of 87.7% and 58.0% respectively, between 1994 and 1997.
The number of sales representatives (both full-time and part-time) employed by
the Company has increased from approximately 100 as of December 31, 1993 to
approximately 1,000 as of December 31, 1997. Over that same period, the
Company's mix between part-time and full-time representatives shifted from 100%
part-time to 45% part-time. The Company has also experienced a consistently high
renewal rate among its clients. For example, for 1997, approximately 86% of the
Company's revenue was generated from clients that had contributed to the
Company's 1996 revenue.
 
     The Company believes that because of the benefits of outsourcing,
pharmaceutical companies have made a strategic decision to continue to outsource
a significant portion of their sales and marketing activities. The Company
believes that the trend toward the increased use of CSOs by pharmaceutical
companies will continue due to the following industry dynamics: (i)
pharmaceutical companies will continue to expand their product portfolios and as
a result will need to add sales force capacity, (ii) pharmaceutical companies
will continue to face margin pressures and will seek to maintain flexibility by
converting fixed costs to variable costs, and (iii) the availability of
qualified CSOs will provide an incentive to pharmaceutical companies to continue
to outsource this function.
 
     The Company believes that it is well positioned to benefit from these
growth opportunities. Through its 10 years of providing service to the United
States pharmaceutical industry, the Company has demonstrated that it is a
high-quality, results-oriented provider of detailing services. In addition, the
Company maintains a highly qualified sales force as a result of a rigorous
recruiting process and training programs that are comparable to those of the
pharmaceutical companies. The Company believes that one of its biggest
competitive advantages is its ability to provide customized solutions to its
clients. Finally, as one of the largest CSOs, the Company has achieved the size
and demonstrated the ability to perform large detailing programs and execute
several programs simultaneously.
 
     In order to leverage its competitive advantages, PDI's growth strategy
emphasizes: (i) enhancing its leadership position in the growing CSO market by
maintaining its historic focus on high-quality contract sales services and by
continuing to build and invest in the Company's core competencies and
operations; (ii) expanding both its relationship with existing clients and its
selling efforts to capture new clients; (iii) offering
 
                                       24

<PAGE>
additional promotional, marketing and educational services and further
developing its existing detailing services; (iv) entering new geographic
markets; and (v) investigating and pursuing appropriate acquisitions of
detailing or detailing-related companies.
 
PRODUCT DETAILING
 
     Pharmaceutical companies incur substantial expenses in connection with
their sales and marketing activities. The Company estimates, based on industry
data, that in 1996 pharmaceutical companies in the United States expended
approximately $6.7 billion on promotional spending, including product detailing,
event spending, journal advertising, and, more recently, direct-to-consumer
advertising. The primary targets of this promotional activity are persons making
product selection decisions, including physicians and others legally authorized
to prescribe or dispense drug therapies. The Company estimates that, on average,
product detailing represents approximately 60% of a pharmaceutical company's
total promotional spending. According to Scott-Levin, pharmaceutical companies
in the United States spent approximately $4.5 billion on product detailing in
1996.
 
     The Company believes that product detailing is a highly effective means of
influencing the prescribing patterns of the targeted prescribers and, therefore,
it is the most commonly employed strategy to promote pharmaceutical products.
Product detailing involves face-to-face meetings between a sales representative
and a targeted prescriber. The target of a product detail is usually a physician
identified because of his or her specialty or prescribing patterns. However,
other legally authorized prescribers -- such as nurse practitioners, physician
assistants or pharmacists -- may also be targets for detailing. Detailing
generally occurs in physician offices and hospitals, although conventions and
trade association meetings may also provide an appropriate forum. The sales
representative is required to possess a high level of product knowledge, as well
as other technical and therapeutic expertise. The interaction itself involves a
technical review of the product's legally authorized indications and usage, role
in disease treatment, mechanism of action, side effects, dosing, drug
interactions, cost and availability (i.e., the 'details'). The sales
representative and the targeted prescriber will also typically discuss the types
of patients best suited for the particular product and how and when such
patients will best benefit from the product's use. Competitive products and
their relative strengths and weaknesses in contrast to the product being
detailed may also be discussed.
 
     Product detailing takes place in the context of a personal sales call
during which a sales representative typically will detail one to three products.
The amount of time devoted to each product detailed during a call depends upon
that product's detail position ('slot') within the call. A call may last as long
as eight to ten minutes or may be as short as one to two minutes, depending upon
a number of factors, principally the target prescriber's availability. Product
detailing typically takes place in selling cycles of four to eight weeks, during
which period the sales representative will attempt to call each targeted
prescriber in his or her geographic territory at least once. A single program
may have three to 12 cycles. The repeat interactions between the sales
representative and the targeted prescriber are intended to establish trust
between the sales representative and the targeted prescriber, influence the
prescribing pattern of the physician, obtain market share for new products,
maintain market share for existing products and build barriers to entry against
competing products.
 
THE CSO INDUSTRY
 
  OVERVIEW
 
     The CSO industry provides outsourced physician detailing programs to
pharmaceutical, medical device and diagnostic companies. CSOs have evolved from
providing detailing support for OTC products into a full-service industry
handling some of the leading ethical pharmaceutical compounds. Since the early
1990's, the pharmaceutical industry in the United States has increasingly used
CSOs to provide the detailing service required to introduce new products,
reintroduce older products, supplement existing sales efforts, raise promotional
barriers to entry for competitors and demonstrate the incremental sales impact
of detailing a particular product. While there is little available data
regarding the CSO industry, the Company believes that there are approximately
eight CSOs currently operating in the United States. The Company also believes
that only 17 of the 50 largest pharmaceutical companies in the United States,
measured by healthcare revenue, currently use CSOs. Finally, the Company
estimates that contract revenues for the CSO industry in the United States
increased from approximately $80 million in 1995 to $185 million in 1996 and
$325 million in 1997.
 
                                       25

<PAGE>
     The CSO industry emerged in the 1980's in the United Kingdom, where
regulatory and cost containment pressure, the Company believes, led
pharmaceutical companies to search for a more efficient method of promoting new
and existing products. Pharmaceutical companies discovered that CSOs were an
effective tool for shifting high fixed costs to variable costs by enabling them
to outsource their sales and marketing activities as a supplement to their own
internal sales efforts. The Company believes that similar regulatory and cost
containment dynamics have, and will continue, to shape the demand for contract
sales services in the United States. In response to cost and margin pressures
brought on by managed care in the early 1990's, the pharmaceutical companies in
the United States reduced the size of their internal sales forces. According to
Med Ad News, a leading medical advertising and communications trade publication,
since 1994 pharmaceutical companies have expanded their internal sales forces.
The Company estimates that at the end of 1997, the largest 50 pharmaceutical
companies in the United States employed approximately 50,000 full-time sales
representatives, a 19% increase since 1994. During this period the number of
sales representatives utilized by CSOs in the United States has also increased
from approximately 1,100 as of December 31, 1994 to approximately 6,300 at the
end of 1997. At the end of 1994, 1995, 1996 and 1997 the Company estimates that
the number of sales representatives utilized by the CSO industry in the United
States represented approximately 2.6%, 4.3%, 7.6% and 11.2%, respectively, of
the combined number of CSO and in-house pharmaceutical sales representatives
utilized by such pharmaceutical companies in those years. In addition, during
this period, the Company believes that the portion of full-time sales
representatives employed or used by the CSO industry has increased.
 
  TRENDS AFFECTING GROWTH
 
     The Company believes that because of the benefits of outsourcing,
pharmaceutical companies have made a strategic decision to continue to outsource
a significant portion of their sales and marketing activities. The Company
believes that the trend toward the increased use of CSOs by pharmaceutical
companies will continue because of the following industry dynamics:
 
     Expanding product portfolios.  The Company believes that the ability of
pharmaceutical companies to remain competitive and profitable depends upon their
ability to introduce new drugs. According to Pharmaceutical Research and
Manufacturers of America, an industry trade group ('PhRMA'), the pharmaceutical
industry spent $18.9 billion on research and development in 1997, an increase of
11.8% over 1996 research and development expenditure of $16.9 billion. In
addition, in 1996, the United States Food and Drug Administration (the 'FDA')
approved for sale 131 new drugs and drug indications. In 1994, 1995, 1996 and
1997, the FDA approved 22, 28, 53 and 39 new molecular entities, respectively,
as a result of its expedited review and approval procedures. As a result, the
pharmaceutical industry will require additional sales force capacity that, the
Company believes, will increase the demand for CSO services.
 
     Margin pressures.  The potential for implementation of national healthcare
reform in the early 1990s and the growing influence of managed care and
healthcare cost containment initiatives throughout the 1990s has created
pressure to reduce the rate of price increases for pharmaceutical products.
According to IMS America, a healthcare marketing information company ('IMS'),
prices for prescription products rose, on average, only 1.6% in 1996, and 1.9%
in 1995. These pressures have forced the pharmaceutical industry to focus on
increasing unit growth while reducing fixed operating costs. CSOs provide the
support necessary to increase unit growth while converting high fixed costs to
variable costs.
 
     Increased use of drug therapies.  The amount spent on prescription drugs
and the number of prescriptions filled has been steadily increasing. According
to IMS, in 1996 over $85.3 billion was spent on prescription drugs compared to
$77.4 billion in 1995. In addition, according to IMS, approximately 2.4 billion
prescriptions were filled in 1996 compared to 2.3 billion prescriptions in 1995.
The Company believes that this trend toward increased use of drug therapies will
continue as it is attributable to a number of factors that are not expected to
change over the near term, including the expedited FDA review process, an aging
population, an expanded portfolio of pharmaceutical products, the efficacy of
drug therapy and the lower cost of drug therapy relative to hospitalization and
medical procedures. As managed care programs have proliferated, an increasing
number of consumers benefit from low co-pay arrangements with respect to
prescription drugs. As a result, consumers consider prescription medication a
less expensive, relatively non-invasive alternative for treating illness and are
 
                                       26

<PAGE>
increasingly likely to comply with their drug therapies. As the use of drug
therapies increases, so does the importance of product detailing.
 
     Importance of flexibility.  Pharmaceutical companies are outsourcing a
variety of their activities in order to maximize flexibility and reduce fixed
costs. The desire to maximize flexibility and reduce fixed costs is a major
factor in the increasing utilization of CSOs. Flexibility and adaptability in
sales and marketing are crucial for balancing cost containment pressures against
pricing pressure and expanded research and development expenditures. CSOs
enhance flexibility by maximizing the ability of pharmaceutical companies to
deploy their human resources more efficiently. Similarly, by using CSOs, it is
possible to convert the high fixed cost of building, training, deploying and
maintaining a sales force (i.e., salaries and other employee-related costs) into
a variable cost.
 
     Availability of qualified CSOs; ability to demonstrate success.  The
Company believes that the pharmaceutical industry will continue to utilize CSOs
as the CSO industry further demonstrates its ability to quickly mobilize trained
professional sales forces capable of supplementing the work and replicating the
results of the internal sales forces of the pharmaceutical companies. In
addition, the recent development of sophisticated prescription tracking systems
and advances in information technology have enabled pharmaceutical companies to
measure the impact of product detailing on sales and to assess the efficacy of
both internal and third party sales forces in ways that were not possible a few
years ago. Consequently, the Company believes that CSOs are becoming an
increasingly important resource advantage in the overall marketing and sales
efforts of pharmaceutical companies.
 
     Need to maximize return on investment.  The pharmaceutical industry is
characterized by intense competition, due, in part, to an increasing number of
products. In addition, as a result of managed care, government initiatives to
reduce healthcare costs and market forces, the pharmaceutical industry is
experiencing lower margins and increased pressure to contain price increases. To
maximize and deliver acceptable returns on investment (mostly in the form of
research and development expenditures), pharmaceutical companies must ensure
that their products are fully supported by sales and marketing efforts during
their entire life cycles. As the effective lives of drugs are threatened by
patent expirations and competition from new compounds, pharmaceutical companies
employ various strategies, including outsourcing sales efforts, to enable
products to achieve their maximum sales potential.
 
     In addition, the Company believes that other sectors of the healthcare
industry will contribute to the growth of CSOs. For example, the United States
biotechnology industry has grown rapidly in the last decade and is developing
significant numbers of new therapies that are now entering clinical trials.
Generally, these companies do not have the internal resources to market and sell
their products. Accordingly, the Company believes that, as biotechnology
products receive the necessary regulatory approvals, this industry will be
looking to outsource various functions, particularly sales and marketing.
 
COMPANY'S COMPETITIVE ADVANTAGES
 
     The Company believes that a significant market opportunity exists for CSOs
that can provide high-quality sales solutions across a variety of sales,
marketing and therapeutic applications and that have demonstrated a willingness
and ability to respond to the particular needs of clients.
 
     Reputation for quality.  Virtually every program designed by the Company
has met or exceeded the goals established at the beginning of the program. The
Company believes that these results have earned it a reputation in the industry
as a high-quality, results-oriented provider of detailing services. The
Company's success is illustrated by its long-standing relationship with such
'blue chip' clients as Pfizer, Astra Merck, Glaxo Wellcome and Johnson &
Johnson.
 
     High-quality sales force.  The Company's overall commitment to quality is
evidenced by its recruiting, hiring and training processes. The Company believes
that its recruiting and hiring process is one of the most comprehensive,
challenging, rigorous, selective and professional processes in the industry and
that its training programs are comparable to those designed by pharmaceutical
companies to train their internal sales forces. The Company offers its sales
representatives a compensation package that it believes is competitive with
compensation packages that the major pharmaceutical companies offer to their own
sales forces. Many of the Company's competitors use independent contractors as
sales representatives who are compensated based on the
 
                                       27

<PAGE>
number of calls or on an hourly basis. All of the Company's personnel, including
sales representatives, managers and recruiting coordinators, are employees
rather than independent contractors. The Company believes that its treatment of
its sales representatives as employees and its compensation system are important
factors in its ability to attract and retain talented sales personnel. The
Company has found that a base salary and incentive bonus compensation package is
best suited for a results-oriented program and for achieving program objectives,
while a per call or hourly compensation structure emphasizes the number of
details rather than the quality of the detailing effort.
 
     Ability to design customized solutions.  The Company believes that its
ability to innovate and to provide a dedicated, vertically integrated sales
force custom-designed to meet the specific needs of a client is a principal
competitive advantage. Such customization includes the size, profile (i.e.,
part-time versus full-time), experience, training, geographic deployment and
allocation of the sales force against the targeted prescribers and the number of
calls for each targeted prescriber, the particular compensation package for the
sales force and field and database management support, such as in-house
territory mapping, physician satisfaction surveys, call reporting services and
regulatory compliance services. In particular, the Company believes that its
ability to provide full-time, part-time or a combination of full-time and
part-time sales representatives, constitutes a competitive advantage. Finally,
the Company's management and data information systems enable it to provide its
clients with information and services most of its competitors cannot, and thus
reduces the time and expense its clients would otherwise have to devote to a
product detailing program.
 
     Size and infrastructure.  The Company believes that its size,
organizational structure and overall resources enable it to implement multiple
programs simultaneously and to implement large programs that smaller CSOs may be
precluded from executing. The Company has made substantial investments in all of
its personnel and management information systems in order to be able to
successfully implement a variety of large and small programs simultaneously.
 
GROWTH STRATEGY
 
     The Company's objective is to enhance its leadership position in the
growing CSO industry and to become the premier supplier of comprehensive
customized sales solutions to the pharmaceutical industry and other segments of
the healthcare market. The following are the principal elements of the Company's
growth strategy:
 
      Enhance leadership position in growing CSO industry.  The Company believes
that its leadership position in the growing CSO industry is a result of its
competitive advantages. The Company is committed to maintaining its position as
a leader and innovator in the growing CSO industry by further developing its
core competencies -- recruiting, hiring and training, sales management,
information and data management, human resources and financial management. As
the CSO market expands, the Company is well positioned to sustain its growth.
 
     Strengthen relationships with existing clients.  Leveraging the past
success of its programs, the Company will actively seek to expand and renew
existing programs with existing clients and seek to capture new programs from
its existing clients by identifying new opportunities with such clients.
 
     Expand client base.  The Company believes that a significant opportunity
exists among pharmaceutical companies that do not currently utilize CSOs. The
Company has provided services to 11 of the 50 largest pharmaceutical companies
in the United States, measured by healthcare revenues. The Company believes that
33 of such companies do not currently use any CSOs. The Company will seek to
expand its client base by targeting pharmaceutical companies that are not
currently clients and which have attractive product portfolios. In addition,
future initiatives may focus on other sectors of the healthcare market that
could benefit from the Company's services, such as biotechnology companies and
medical device manufacturers.
 
     Provide additional services.  As a leading provider of physician detailing
programs, the Company believes that it has an established platform from which to
offer complementary promotional and marketing services to its clients. The
Company will leverage its core competencies to further develop its specialized
sales forces to meet the needs of its clients.
 
                                       28

<PAGE>
     Enter new geographic markets.  The Company will look for opportunities to
provide promotional services in markets outside the United States. This
expansion may be in the form of strategic joint ventures or acquisitions or by
building a presence using the Company's own internal resources.
 
     Pursue strategic acquisitions.  The Company intends to explore strategic
acquisitions in complementary and existing business areas. The Company believes
that by acquiring other CSOs and/or sales and marketing companies it may be able
to accelerate the development of a broader array of services or expand existing
services more efficiently and rapidly than developing these service capabilities
internally. In addition, the Company may pursue acquisitions in order to enter
new markets, where it currently has no presence.
 
PROGRAM DESCRIPTION
 
     The Company's customized detailing programs typically contain three basic
elements: design, execution and assessment. In the program design phase, the
Company undertakes to understand the needs and objectives of the client,
identifies, defines and ranks the proposed target audience and determines
appropriate staffing. In the program execution phase, the Company recruits,
hires, trains and manages the sales force. Finally, in the program assessment
phase, the Company measures the performance of the sales force and the success
of the program relative to the goals and objectives of the program. While each
program relies on the same basic core competencies, programs are custom-designed
to provide significant strategic advantages to the client by taking into account
the geographic, marketing and scheduling needs of the client, the product itself
and the profile of the target audience.
 
  PROGRAM DESIGN
 
     Prior to entering into a contract and usually in response to a request for
a proposal, the Company sets forth the details of a program in a comprehensive
proposal. The purpose of the proposal is to create an overall approach to the
program, which helps the Company establish a 'plan of action' for launch and
subsequent implementation. Among other things, the Company will use the proposal
to clarify the goals of the program and to analyze any data supplied by the
client in connection with its request. For example, as part of its pre-program
assessment, the Company will analyze the target physician list provided by the
client, which can include the names of 100,000 or more physicians, for the
purpose of targeting the most productive physicians in the most efficient
manner. The Company ranks the targeted prescribers based on statistical data
such as number of prescriptions written, prior coverage for the product and for
the general pharmaceutical class to which such product belongs, as well as the
product and class history among the proposed audience. The proposal incorporates
the Company's recommendations regarding territory mapping and the allocation of
sales representatives and sales managers within such territories. This results
in more efficient use of sales representatives, better target audience
penetration, reduced sales force turnover and, ultimately, maximum impact on
sales. This process is also instrumental in structuring compensatory
arrangements and payment terms.
 
     Staffing requirements.  In the program design phase, the Company identifies
the assets to be committed to the program (i.e., divisional managers, district
managers, field managers and sales representatives), the profile of the sales
representatives (i.e., part-time and full-time), training requirements, the
deployment of the sales force in terms of geography, the number of details per
call and the number of times each target will be called over a defined period of
time ('call-back frequency'). In determining staffing requirements, the Company
takes into account a number of considerations, including the preferences of the
client, the size of the individual territories, the number of targeted
physicians in a given territory, the call-back frequency and the cost
effectiveness of a full-time or part-time representative. The Company believes
that its ability to provide both full-time and part-time sales representatives
is important to providing its clients with a customized sales force able to meet
the goals of the sales program in a cost effective manner.
 
     Deployment strategy.  In the program design phase, the Company performs
'territory mapping'-- i.e., a plan to deploy the sales force over the geographic
region in which the targeted prescribers are located. The Company analyzes the
physician target list for the purpose of grouping the targets according to
selected criteria. The Company believes that its mapping and territory
deployment analysis gives it a competitive advantage over other CSOs in pricing
contracts and ensuring the success of the program.
 
                                       29

<PAGE>
     Return on investment models.  The goal of any program is to maximize
results from the promotional dollars spent by the client. Accordingly, in
connection with its pre-program assessment and analysis, the Company develops a
Return on Investment ('ROI') model for the program. The model can be used to
establish goals for the program and enables clients to clearly quantify the
value of the services provided by the Company. The ROI model has the ability to
project program effectiveness in incremental net sales, and may ultimately be a
key factor in demonstrating why a program should be renewed or expanded. The ROI
model is based on a confidential set of data and is considered proprietary by
the Company.
 
  PROGRAM EXECUTION
 
     The Company believes that its ability to recruit quickly on a national
basis, the quality of its training programs, the experience of its management
and its data and management information systems provide clients with a highly
effective sales force designed to meet a program's needs.
 
     Recruiting and hiring.  Recruiting and hiring the best qualified sales
personnel quickly is vital to ensure positive program results and minimize
turnover. The Company maintains a disciplined and efficient recruiting process
that is managed by a National Manager of Recruiting overseeing a staff of 10,
including five regional Recruiting Managers. This structure facilitates
recruiting on a region by region basis, thus saving time and money.
 
     The Company has developed a multi-step recruiting and hiring process that
it believes is comprehensive, rigorous, selective and professional. The Company
maintains a database of resumes of qualified, potential sales representatives.
The Company has also developed a relationship with a national recruiting firm in
the healthcare field and maintains an extensive referral system. Placing
advertisements in local publications through the services of a single source
provides cost and process control over the Company's recruitment efforts. The
recruiting and hiring process includes preliminary screening procedures,
background checks where required by the client, reference checks, drug testing
and a rigorous interview process during which candidates are required to sit for
multiple interviews with different sales managers. Typically, one to three
percent of the initial applicants screened in connection with a program are
hired. The result is an experienced, highly-qualified and motivated sales force.
 
     All of the Company's field sales personnel, including sales
representatives, managers and recruiting coordinators, are employees rather than
independent contractors. In addition, the Company offers its sales
representatives a compensation package that it believes is competitive with
compensation packages offered by the major pharmaceutical companies. The
compensation package offered by the Company includes a base salary and
performance-based incentives that relate to the specific goals of the program,
as well as fringe benefits, including a car allowance and, for full-time sales
representatives, health insurance coverage. The Company believes that its
treatment of its sales representatives as employees and its compensation system
are important factors in its ability to attract and retain talented sales
personnel. The Company has found that a base salary and incentive bonus
compensation package is best suited for a results-oriented program and for
achieving program objectives, while a per call or hourly compensation structure
emphasizes the number of details rather than the quality of the detailing
effort. In addition, treating its sales representatives as employees enhances
the Company's ability to direct and manage the daily activities of its field
force and integrate with its clients' sales teams. It also allows the Company to
provide career advancement opportunities -- a powerful motivational tool.
 
     Training.  The Company's Training and Development Department consists of a
National Training and Development Manager, a Director of Sales, Training and
Development and six dedicated Training Managers. In connection with each
program, the Company undertakes the training of the district managers and the
sales representatives with respect to the products being detailed. The training
programs are designed jointly by the Company and the client and are comparable
to the training programs employed by the client for its own internal sales
force. The client will either participate with the Company in the training, or
train the Company's managers who will then implement the training program. Each
sales representative is required to complete one to two weeks of home study and
attend a three day to three week training seminar. Typically, training involves
written material as well as seminars and other presentations which all sales
representatives are required to attend. All training programs dedicate time to
workshops and interactive role playing. The Company's sales representatives use
the same manuals and materials and must pass the same product knowledge tests as
the client's in-house sales
 
                                       30

<PAGE>
representatives. In-field training continues at the local level as determined by
the National Sales Manager of the program.
 
     Sales management.  The Company's sales programs are supervised by two Vice
Presidents who report to the Chief Operating Officer. Each Vice President
manages four to six programs and is responsible for the overall execution of
each program, including the performance of the entire sales force
(representatives and managers), monitoring the product sales generated and
client satisfaction. Each program has a dedicated National Sales Manager, field
managers (Division and District Managers) and sales representatives. A National
Sales Manager may also have several Regional Managers reporting to him. Programs
may also have one or more dedicated program trainers. Division Managers
(full-time) and District Managers (part-time) are responsible for the direct
supervision of the field sales representatives. A Division Manager normally
manages ten to twelve representatives, while a District Manager usually manages
six to eight.
 
  PROGRAM ASSESSMENT
 
     Data and information management and reporting.  The Company's database
management group and call reporting center monitor each program. The operations
area handles hundreds of thousands of detail call reports per year, producing
all related reports for the sales teams, management and the client. This
comprehensive operations support frees up client and management resources that
would otherwise be burdened. Each sales representative is required to file call
activity reports on a daily basis. The reports reflect the sales
representative's activities since his last report including the number of calls,
the number of details as well as a confirmation signature from the target
prescriber. To date, the Company's call reporting system has been a paper based
system. However, the Company has recently instituted a program whereby certain
sales representatives will be given palm top computers. This program will
facilitate the submission of call activity reports and reduce the time required
to produce management reports.
 
     The Company has developed several management tools to maximize the
effectiveness of its sales forces. These management tools can be used to track
the overall effectiveness of the program as well as the performance of
individual sales representatives. One such tool is the Integrated Sales and
Activity Report ('ISA'), which allows the sales representatives to tailor
strategies and to evaluate the effectiveness of their sales efforts. The ISA is
generally produced bi-monthly and compares the current period to the prior
period. The report can be customized to reflect progress made toward a specific
goal or target for purposes of evaluating a program.
 
     Physician satisfaction surveys.  In connection with each program, the
Company develops a program-specific physician satisfaction survey ('PSS'). The
PSS is periodically sent out to selected members of the target audience,
depending on the size of the program. The PSS solicits comments on a variety of
topics relating to the call, including the professionalism of the sales
representative and current prescribing patterns. Finally, the survey asks the
physician to confirm his signature. These surveys are an indispensable tool,
both for determining the effectiveness of the program designed by the Company
and assessing the performance of the Company's sales force.
 
     Product sample tracking.  Federal laws and regulations require that
detailed records be kept concerning the distribution of pharmaceutical product
samples. These record keeping requirements are the responsibility of the
manufacturer. The Company has developed a sample tracking system that it
believes complies with such laws and regulations. As part of its services, the
Company performs this function on the client's behalf.
 
     Quantitative analysis.  At the conclusion of each program the Company
prepares a case study for the client that documents the results of the program
relative to the goals established at the outset of the program as well as the
ROI.
 
SPECIALIZED DETAILING FORCES AND SERVICES
 
     In addition to the traditional, custom-designed, client-dedicated,
long-term (one year or longer) detailing sales force program, the Company has
developed specialized detailing forces and services, described below, to address
varying needs of the pharmaceutical industry. While these services do not
currently represent a material portion of the Company's business, they are
considered important to the Company's future growth.
 
                                       31

<PAGE>
     Strike Force.  Strike Force is a sales force designed for fast roll-out and
short time frames (six months or less). Strike Force is generally used in
situations where the client requires short-term detailing support and faster
penetration of the target audience. Examples of applications for Strike Force
include seasonal brands, new product launches, conversion from prescription to
OTC and gaps in product coverage. For example, Strike Force was used by one
client to launch a new formulation of its children's cough and cold product. The
main objective was to increase pediatrician awareness and recommendations during
the cough and cold season.
 
     Share Force.  Share Force is a sales force designed to detail up to three
products from the same or different manufacturers to the same target audience.
The Share Force program offers clients flexibility in terms of pricing
(depending on the slotting) and program length, as well as access to
pre-targeted high volume prescribers. The Company assembles a sales team
targeted at a fixed list of physicians within a specialty that it believes to
represent a high volume prescribing audience. These physicians are selected and
profiled through the use of prescription data to ensure that they represent the
most productive physicians (in terms of prescriptions written) within multiple
therapeutic categories. Fees are determined by the detail position, or priority,
given to a particular product (known as 'slotting'). The Company has commenced
marketing Share Force but has not yet deployed any such force.
 
     Staffing Services.  The Company acts as a recruiting and placement agency,
using its skills in recruiting and hiring to help a client build its own
internal sales force. The Company performs all screening, checking, testing and
interviewing functions and then refers the most qualified candidates to the
client for final approval. The Company typically receives a fee for each sales
representative hired by the client.
 
     Sales Force Build.  Sales Force Build is a variation on Staffing Services.
The Company assembles a customized, client-dedicated sales force, designed at
the outset of a program with the specific intent that the client will hire the
sales representatives either at the conclusion of the program or at a
pre-determined time. In addition to the program fees, the Company receives a
placement fee for those sales representatives hired by the client.
 
     Convention Plus.  The Company provides custom-designed teams for trade show
and convention management support. Instead of staffing conventions with its own
sales representatives, which results in lost sales calls, the client engages the
Company to manage every aspect of the convention including registration, set-up,
staffing and reporting. The team can be built exclusively for one client or
shared by several clients.
 
CLIENTS AND CONTRACTS
 
  CLIENTS
 
     The Company believes that its relationships with its clients, which include
many of the largest pharmaceutical companies in the United States, are among its
most important strategic assets and competitive advantages. The Company has
enjoyed long-standing relationships with many of these clients, and a high
percentage of its clients either renew their programs or enter into new
contracts with the Company for new programs. The Company believes that the
quality and stability of its client base promotes the consistency of its core
business and that the scope and complexity of its clients' marketing needs
present opportunities for expansion into new areas. There can be no assurance,
however, that the Company's clients will continue to renew or expand their
relationship with the Company.
 
     During 1997, the Company executed 15 detailing programs for 12 clients. In
1997, Pfizer, Glaxo Wellcome, Astra Merck and Novartis accounted for 25%, 22%,
19% and 10%, respectively, of the Company's revenue. Collectively, these four
clients accounted for approximately 76% of the Company's revenue. The loss of
any one of the foregoing clients could have a material adverse impact on the
Company's business. In 1996, Pfizer, Astra Merck, Novartis and Johnson & Johnson
each accounted for 10% or more of the Company's revenue. Collectively, these
clients accounted for approximately 84% of the Company's revenue. In 1995, one
program accounted for more than 42% of the Company's revenue and three other
programs each accounted for 10% or more of the Company's revenue. Collectively,
these four programs represented approximately 84% of the Company's revenue. In
1994, two programs each accounted for more than 30% of the Company's revenue and
another program accounted for 10% or more of the Company's revenue. Together,
the three programs represented approximately 83% of the Company's revenue.
 
                                       32

<PAGE>
  CONTRACTS
 
     Given the customized nature of the Company's business, it utilizes a
variety of contract structures with its clients. Generally, contracts provide
for a fee to be paid based on the Company delivering a specified package of
services. Contracts typically include performance benchmarks, such as a minimum
number of sales representatives or a minimum number of calls. In certain
instances, the Company may be entitled to additional compensation based upon the
success of the program and/or subject to penalties for failing to meet stated
performance benchmarks. The Company typically receives a portion of its fee upon
commencement of the program to reflect the costs of implementing such program.
In addition, contracts typically provide that the Company is entitled to a fee
for each sales representative hired by the client during or at the conclusion of
a program.
 
     The Company's contracts generally are for terms of six months to one year
and are subject to renewal upon expiration. However, the Company's contracts are
terminable by the client for any reason upon 30 to 90 days notice. The Company's
contracts typically provide for termination payments by the client upon a
termination without cause. While the cancellation of certain of the Company's
contracts by a client without cause may result in the imposition of penalties on
such client, such penalties may not act as an adequate deterrent to the
termination of any such contracts. In addition, there can be no assurance that
such penalties will offset the lost revenue or the costs incurred by the Company
as a result of such termination. The loss or termination of a large contract or
the loss of multiple contracts could adversely affect the Company's future
revenue and profitability. Contracts may also be terminated for cause if the
Company fails to meet stated performance benchmarks. To date, no programs have
been terminated for cause.
 
     The Company's contracts typically contain cross-indemnification provisions
between the Company and its client. Typically, the client will indemnify the
Company against product liability and related claims arising from the sale of
the product and the Company indemnifies the clients with respect to the errors
and omissions of the Company's sales representatives in the course of their
detailing activities. To date, the Company has not asserted, nor has there been
asserted against the Company, any claim for indemnification pursuant to a
contract.
 
MARKETING AND BUSINESS DEVELOPMENT
 
     Most of the Company's revenue is derived from renewals and extensions of
existing programs and new programs with existing clients. The Company derives
new business from responses to 'requests for proposals' from pharmaceutical
companies that the Company believes are the result of its promotional and
advertising efforts. Recently, the Company has increasingly engaged in proactive
efforts to generate more business from new and prospective clients. The Company
has implemented a sales process that is designed to leverage its results-
oriented image through case studies, references, ROI models and comprehensive
proposals. The Company also has implemented an enhanced marketing and new
business development process for the purpose of improving its ability to secure
more contracts both within the pharmaceutical industry and in other healthcare
markets. This new business development process relies on the use of a dedicated
sales and marketing team.
 
     The Company seeks to promote awareness of its capabilities to senior level
executives, product managers and sales managers of both its existing and
potential clients so that when situations arise where additional product
detailing services are needed, those prospects are already aware of the Company
and its image as a high-quality, results-oriented firm. In order to build and
sustain awareness of its services, a combination of trade journal advertising,
mailings, and a public relations campaign are utilized. The Company advertises
in publications such as Pharmaceutical Executive and Med Ad News. The marketing
department maintains a proprietary mailing list of over 3,000 pharmaceutical
industry personnel including CEOs, vice presidents and marketing, sales and
product managers. In addition to its ongoing monthly mailings, the Company also
conducts specialized mailings in response to contacts received from specific
companies or about specific developments within the industry. The public
relations campaign also involves interviews in trade journals and other
publications and speaking engagements for the Company's executives.
 
                                       33

<PAGE>
COMPETITION
 
     The primary competitive factor affecting contract sales services is the
ability to quickly hire, train, deploy and manage qualified sales
representatives to implement simultaneously several large product detailing
programs. The Company also competes with other CSOs on the basis of such factors
as its reputation, quality of its services, experience of management,
performance record, customer satisfaction, ability to respond to specific client
needs, integration skills and price. The Company believes it competes favorably
with respect to each of these factors.
 
     The Company primarily competes with in-house sales and marketing
departments of pharmaceutical companies, other CSOs and other third party
providers to the pharmaceutical industry, many of which possess substantially
greater capital, personnel and other resources than the Company. In addition to
the in-house sales forces of pharmaceutical companies, the Company's current
major competitors include CSOs such as Innovex Limited, a subsidiary of
Quintiles Transnational Corp., and the various sales and marketing affiliates of
Snyder Communications, Inc. As a result of competitive pressures, various sales
and marketing organizations providing services to the pharmaceutical industry
are consolidating and are becoming targets of global organizations. This trend
is likely to produce increased competition among CSOs for both clients and
acquisition candidates and increased competitive pressures on smaller providers.
If the trend in the pharmaceutical industry towards consolidation continues,
pharmaceutical companies may have excess in-house sales force capacity and may,
as a result, reduce or eliminate their use of CSOs. There are relatively few
barriers to entry into the CSO industry and there can be no assurance that, as
the CSO industry continues to evolve, additional competitors with greater
resources than the Company will not enter the industry or that the Company's
customers will not choose to conduct more of their sales services internally,
with other CSOs or with organizations that can provide a broader range of sales
and marketing services. Although the Company intends to monitor industry trends
and respond accordingly, there can be no assurance that the Company will be able
to anticipate and successfully respond to such trends. Increased competition may
lead to price and other forms of competition that may have a material adverse
effect on the Company's business and results of operations.
 
GOVERNMENT AND INDUSTRY REGULATION
 
     The healthcare industry is subject to extensive regulation. Various laws,
regulations and guidelines promulgated by government, industry and professional
bodies affect, among other matters, the provision, licensing, labeling,
marketing, promotion, sale and reimbursement of healthcare services and
products, including pharmaceutical products. It is also possible that additional
or amended laws, regulations or guidelines could be adopted in the future.
 
     The pharmaceutical industry is subject to extensive federal regulation and
oversight by the FDA. For instance, the Federal Food, Drug and Cosmetic Act, as
supplemented by various other statutes, regulates, among other matters, the
approval, labeling, advertising, promotion, sale and distribution of drugs,
including the practice of providing product samples to physicians. Under this
statute, the FDA asserts its authority to regulate all promotional activities
involving prescription drugs. In addition, the sale or distribution of
pharmaceuticals may also be subject to the Federal Trade Commission Act
('FTCA'). Finally, the Prescription Drug Marketing Act ('PDMA') regulates the
ability of pharmaceutical companies to provide physicians with free samples of
their products. Essentially, the PDMA requires extensive record keeping and
labeling of such samples for tracing purposes. Accordingly, the business of the
Company and its clients, to the extent such business involves promotion and
marketing of pharmaceutical products, are subject to the extensive regulation
governing the pharmaceutical industry, and there can be no assurance that the
Company will not be subject to increased regulatory scrutiny in the future.
 
     In addition, some of the services that the Company may provide in the
future are affected by various guidelines promulgated by industry and
professional organizations. For example, certain ethical guidelines promulgated
by the American Medical Association ('AMA') govern, among other matters, the
receipt by physicians of gifts from health-related entities. These guidelines
govern the honoraria, and other items of pecuniary value, which AMA member
physicians may receive, directly or indirectly, from pharmaceutical companies.
Similar guidelines and policies have been adopted by other professional and
industry organizations, such as PhRMA.
 
                                       34

<PAGE>
     The healthcare industry is subject to federal and state laws pertaining to
healthcare fraud and abuse. In particular, certain federal and state laws
prohibit manufacturers, suppliers and providers from offering or giving or
receiving kickbacks or other remuneration in connection with ordering or
recommending purchase or rental of healthcare items and services. The federal
anti-kickback statute provides both civil and criminal penalties for, among
other things, offering or paying any remuneration to induce someone to refer
patients to, or to purchase, lease, or order (or arrange for or recommend the
purchase, lease, or order of), any item or service for which payment may be made
by Medicare or certain federally-funded state healthcare programs (e.g.,
Medicaid). This statute also prohibits soliciting or receiving any remuneration
in exchange for engaging in any of these activities. The prohibition applies
whether the remuneration is provided directly or indirectly, overtly or
covertly, in cash or in kind. Violations of the law can result in numerous
sanctions, including criminal fines, imprisonment, and exclusion from
participation in the Medicare and Medicaid programs.
 
     Several states also have referral, fee splitting and other similar laws
that may restrict the payment or receipt of remuneration in connection with the
purchase or rental of medical equipment and supplies. State laws vary in scope
and have been infrequently interpreted by courts and regulatory agencies, but
may apply to all healthcare items or services, regardless of whether Medicare or
Medicaid funds are involved.
 
     The failure of the Company or its clients to comply with, or any change in,
the applicable regulatory requirements or professional organization or industry
guidelines could, among other things, limit or prohibit the Company or its
clients from conducting certain business activities, subject the Company or its
clients to adverse publicity, increase the costs of regulatory compliance or
subject the Company or its clients to monetary fines or other penalties. Any
such actions could have a material adverse affect on the Company.
 
LIABILITY AND INSURANCE
 
     Liability Insurance.  Participants in the healthcare industry are subject
to lawsuits alleging malpractice, product liability and other legal theories,
many of which can involve large claims and significant legal costs. As a
provider of product detailing services to the pharmaceutical industry, the
Company is subject to the risk of being named as a party in such lawsuits. As a
result of its contract sales services, the Company believes that it may become
involved in litigation regarding the products distributed by its personnel, with
the attendant risks of significant legal costs, substantial damage awards and
adverse publicity. Even if such claims ultimately prove to be without merit,
defending against them can result in adverse publicity, diversion of
management's time and attention and substantial expenses, which could have a
material adverse effect on the Company.
 
     The Company maintains general liability insurance, which it believes to be
adequate in amount and coverage for the current size and scope of its operations
although there can be no assurance of that fact. However, the policies
maintained by the Company do not insure it against the errors and omissions of
its employees. The Company may seek increased insurance coverage as well as
insurance for the errors and omissions of its employees in connection with
expanding its service offerings, although the Company has not experienced
difficulty in obtaining insurance coverage in the past, there can be no
assurance that the Company will obtain increased or additional insurance
coverage on acceptable terms or at all. In addition, although the Company's
clients may indemnify the Company for the client's negligent conduct, such
indemnification may not be adequate in light of all of the potential litigation
risks facing the Company. In addition, the Company is often required to
indemnify its clients in the event of the Company's negligence. The Company,
therefore, could be held responsible for losses incurred in connection with the
performance of its services or otherwise and could incur substantial costs in
connection with legal proceedings associated with the performance of its
services or the pharmaceutical products with respect to which it provides
services.
 
     Employment Practice Liability Insurance.  Because the nature of the
Company's business is heavily dependent on its sales force, the Company has
obtained employment practice liability insurance, which insures the Company
against claims made by employees or former employees relating to their
employment, i.e., wrongful termination, sexual harassment, etc. To date, the
Company has not made any claims under this policy. There can be no assurance,
however, that the coverage maintained by the Company will be sufficient to cover
all future claims or will continue to be available in adequate amounts or at a
reasonable cost.
 
                                       35

<PAGE>
LEGAL PROCEEDINGS
 
     From time to time the Company is involved in litigation incidental to its
business. The Company is not currently a party to any pending litigation which,
if decided adversely to the Company, would have a material adverse effect on the
business, financial condition or results of operations of the Company and the
Company is not aware of any material threatened litigation.
 
FACILITIES AND EMPLOYEES
 
     The Company's corporate headquarters are currently located in Mahwah, New
Jersey, in approximately 11,000 square feet of space occupied under a lease
which expires on April 29, 1998. The Company has entered into a new lease for
approximately 27,000 square feet in Upper Saddle River, New Jersey. The new
lease is to take effect on May 1, 1998 and is for a term of 66 months with an
option to extend for an additional five years. In addition, the Company has a
right of first offer with respect to additional space as it becomes available.
Total base rent payable during the term of the new lease is approximately $3.0
million. Additional rent is payable with respect to increases in certain
operating costs over base year amounts.
 
     As of December 31, 1997, the Company had approximately 1,165 employees. The
Company has approximately 70 people working at its headquarters in Mahwah, New
Jersey, 995 sales representatives, and 100 field sales managers. The Company is
not party to a collective bargaining agreement with a labor union and considers
its relations with its employees to be good.
 
                                       36

<PAGE>
                                   MANAGEMENT
 
DIRECTORS AND EXECUTIVE OFFICERS
 
     The following table sets forth the names, ages and principal position, of
the Directors, Director Nominees, executive officers and key employees of the
Company:
 
<TABLE>
<CAPTION>
NAME                                   AGE                                 POSITION
------------------------------------   ---   ---------------------------------------------------------------------
<S>                                    <C>   <C>
John P. Dugan(1)(2).................   62    Chairman of the Board of Directors and Director of Strategic Planning
Charles T. Saldarini................   34    President, Chief Executive Officer and Director
Bernard C. Boyle....................   53    Chief Financial Officer, Executive Vice President, Secretary and
                                             Treasurer
Steven K. Budd......................   41    Chief Operating Officer and Executive Vice President
Robert Wynne........................   47    Vice President -- Account Sales
Cherie Aldana.......................   50    Vice President -- Human Resources
John M. Pietruski ( )...............   64    Director Nominee
Jan Martens Vecsi( )................   53    Director Nominee
Gerald J. Mossinghoff( )............   62    Director Nominee
</TABLE>
 
------------------
(1) Member of Audit Committee
 
(2) Member of Compensation Committee
 
     John P. Dugan is the founder and Chairman of the Board of Directors of the
Company and Director of Strategic Planning. He served as its President from
inception until January 1995 and as its Chief Executive Officer from inception
until November 1997. In 1972, Mr. Dugan founded Dugan Communications, a medical
advertising agency that later became known as Dugan Farley Communications
Associates Inc. ('DFC') and served as its President until 1990. In 1990 Mr.
Dugan acquired sole control of the Company, which was then a wholly-owned
subsidiary of DFC. Mr. Dugan was a founder and served as the President of the
Medical Advertising Agency Association from 1983 to 1984. Mr. Dugan also served
on the Board of Directors of the Pharmaceutical Advertising Council (now known
as the Healthcare Marketing Communications Council, Inc.) and was its President
from 1985 to 1986. Mr. Dugan received an M.B.A. from Boston University in 1964.
 
     Charles T. Saldarini is the President and Chief Executive Officer of the
Company and a Director. Mr. Saldarini became President in January 1995 and Chief
Executive Officer in November 1997. Prior to January 1995 Mr. Saldarini was
Chief Operating Officer of the Company. Mr. Saldarini joined the Company in 1987
as a sales manager. Mr. Saldarini received an A.B. in political science from
Syracuse University in 1985.
 
     Bernard C. Boyle has served as the Company's Executive Vice President and
Chief Financial Officer since March 1997 when he joined the Company. In 1990,
Mr. Boyle founded BCB Awareness, Inc., a firm that provided management advisory
services to the Company, among others, and served as its President until March
1997. During that period he was also a partner in Boyle & Palazzolo, Partners,
an accounting firm that also provided services to the Company. From 1982 through
1990 he served as Controller and then Chief Financial Officer and Treasurer of
William Douglas McAdams, Inc., an advertising agency. From 1966 through 1971,
Mr. Boyle was employed by the national accounting firm of Coopers & Lybrand
L.L.P. as supervisor/senior audit staff. Mr. Boyle received a B.B.A. in
Accounting from Manhattan College in 1965 and an M.B.A. in Corporate Finance
from New York University in 1972.
 
     Steven K. Budd served the Company as a consultant from December 1995 to
April 1996 when he joined as Vice President -- Account Group Sales. He became
Executive Vice-President in July 1997 and Chief Operating Officer in January
1998. Prior to joining the Company, from April through December 1995, Mr. Budd
was an independent consultant. From January 1994 through April 1995, Mr. Budd
was employed by Innovex, Inc., a competing CSO, as a Director of New Business
Development. From 1989 through December 1993, Mr. Budd was employed by
Professional Detailing Network ('PDN'), a competing CSO, as a Vice President
with responsibility for building sales teams and developing marketing
strategies. Mr. Budd received a B.A. in History and Education from Susquehanna
University in 1978.
 
                                       37

<PAGE>
     Robert Wynne joined the Company in August 1990 as a Regional Sales Manager
based in Chicago, Illinois. He currently serves as Vice President -- Account
Sales, a position he has held since December 1994. From 1984 through 1990, Mr.
Wynne was employed by Carnation Nutritional Products Co. and the McNeil Consumer
Products Company, Professional Division, an affiliate of Johnson & Johnson, as a
sales representative and trainer. Mr. Wynne received a B.S. in Secondary
Education from the University of Minnesota in 1972 and an M.S. in Management of
Human Resources from National College of Education in 1985.
 
     Cherie Aldana joined the Company in 1988. Initially, she was employed as
Accounting Manager responsible for financial, payroll, benefits and personnel.
In 1990 she was promoted to Director of Human Resources and in January 1996 to
Vice President -- Human Resources. Ms. Aldana received a B.S. in Accounting from
York College in 1972 and has received certification as a Professional of Human
Resources from the Human Resources Certification Institute, a division of the
Society of Human Resource Management.
 
     Gerald J. Mossinghoff has been nominated to become a director of the
Company immediately upon consummation of this Offering. Mr. Mossinghoff is a
former Assistant Secretary of Commerce and Commissioner of Patents and
Trademarks of the Department of Commerce (1981 to 1985) and served as President
of Pharmaceutical Research and Manufacturers of America from 1985 to 1996. Since
1997 he has been Senior Counsel to the law firm of Oblon, Spivak, McClelland,
Maier and Newstadt of Arlington, Virginia. Mr. Mossinghoff has been a visiting
professor of Intellectual Property Law at the George Washington University Law
School since 1997 and Adjunct Professor of Law at George Mason University School
of Law since 1997. Mr. Mossinghoff served as United States Ambassador to the
Diplomatic Conference on the Revision of the Paris Convention from 1982 to 1985
and as Chairman of the General Assembly of the United Nations World Intellectual
Property Organization from 1983 to 1985. He is also a former Deputy General
Counsel of the National Aeronautics and Space Administration (1976 to 1981). Mr.
Mossinghoff received an Electrical Engineering degree from St. Louis University
in 1957 and a Juris Doctor degree with Honors from the George Washington
University Law School in 1961. He is a member of the Order of the Coif and is a
Fellow in the National Academy of Public Administration. He is the recipient of
many honors, including NASA's Distinguished Service Medal and the Secretary of
Commerce Award for Distinguished Public Service.
 
     John M. Pietruski has been nominated to become a director of the Company
immediately upon consummation of this Offering. Since 1990 Mr. Pietruski has
been the Chairman of the Board of Texas Biotechnology Corp., a pharmaceutical
research and development company. He is a retired Chairman of the Board and
Chief Executive Officer of Sterling Drug Inc. With Sterling Drug Inc. from 1977
to his retirement in 1988, he also held the positions of Executive Vice
President, President and Chief Operating Officer. Mr. Pietruski is a member of
the Boards of Directors of Hershey Foods Corporation, GPU, Inc., Lincoln
National Corporation and McKesson Corporation. Mr. Pietruski graduated Phi Beta
Kappa with a B.S. in Business Administration with honors from Rutgers University
in 1954 and currently serves as a regent of Concordia College.
 
     Jan Martens Vecsi has been nominated to become a director of the Company
immediately upon consummation of this Offering. Ms. Vecsi is the sister-in-law
of John P. Dugan, the Chairman of the Board of the Company. Ms. Vecsi was
employed by Citibank, N.A. from 1967 through 1996 when she retired. Starting in
1986 she served as the Senior Human Resources Officer and Vice President of the
Citibank Private Bank. Ms. Vecsi received a B.A. in Psychology and Elementary
Education from Immaculata College in 1965.
 
     The Board of Directors of the Company is divided into three classes as
nearly equal in number as possible. Each year the shareholders will elect the
members of one of the three classes to a three-year term of office. Ms. Vecsi
serves in the class whose term expires in 1999; Messrs. Saldarini and Pietruski
serve in the class whose term expires in 2000; and Messrs. Dugan and Mossinghoff
serve in the class whose term expires in 2001.
 
     The Board of Directors has an Audit Committee and a Compensation Committee.
The Audit Committee reviews the scope and results of the audit and other
services provided by the Company's independent accountants and internal controls
of the Company. The Compensation Committee is responsible for the approval of
compensation arrangements for officers of the Company and the review of the
Company's compensation plans and policies.
 
                                       38

<PAGE>
EXECUTIVE COMPENSATION
 
     Summary Compensation. The following table presents certain information
concerning compensation paid or accrued for services rendered to the Company in
all capacities during the year ended December 31, 1997, for the Chief Executive
Officer and the other four executive officers of the Company whose aggregate
annual base salary and bonus for 1997 exceeded $100,000 (collectively, the
'Named Executive Officers').
 
<TABLE>
<CAPTION>
                                                                                          LONG-TERM
                                                                                         COMPENSATION
                                                                                         ------------
                                                         ANNUAL COMPENSATION              SHARES OF
                                                 ------------------------------------       COMMON
                                                                            OTHER           STOCK
                                                                            ANNUAL        UNDERLYING      ALL OTHER
         NAME AND PRINCIPAL POSITION              SALARY      BONUS      COMPENSATION      OPTIONS       COMPENSATION
----------------------------------------------   --------    --------    ------------    ------------    ------------
<S>                                              <C>         <C>         <C>             <C>             <C>
John P. Dugan
  Chairman of the Board and Former Chief
  Executive Officer(1)........................   $125,000          --      $ 26,441          --           $2,243,000(1)
Charles T. Saldarini
  President and Chief Executive Officer.......   $120,000    $237,000(2)   $  9,724          --           $4,050,000(3)
Steven K. Budd
  Chief Operating Officer and
  Executive Vice President....................   $112,613    $ 48,000      $  8,396                          --
Bernard C. Boyle
  Chief Financial Officer,
  Executive Vice President,
  Secretary and Treasurer.....................   $105,000(4) $ 18,000      $  1,155                          --
Robert Wynne
  Vice President--Account Sales...............   $102,000    $ 18,000      $  1,155          --              --
</TABLE>
 
------------------
(1) Mr. Dugan was the Chief Executive Officer of the Company until November
    1997. All other compensation represents the bonus payment to Mr. Dugan as
    the majority shareholder of the Company. Such compensation was based on the
    Company's estimated profitability and working capital requirements. As the
    Company will no longer qualify as an S Corporation after the Offering, it is
    not expected that Mr. Dugan will receive bonus payments after the Offering
    in future periods.
(2) Reflects a bonus paid to Mr. Saldarini, President and Chief Executive
    Officer and a minority shareholder of the Company. In addition to the final
    distribution in connection with the termination of the Company's S
    Corporation status, in the future Mr. Saldarini, as President and Chief
    Executive Officer, may receive cash bonuses as determined by the
    Compensation Committee.
(3) Represents the value of Common Stock issued to Mr. Saldarini in January 1997
    as reported by the Company for financial accounting purposes.
(4) Mr. Boyle joined the Company in March 1997. $15,000 of his salary represents
    amounts paid to Mr. Boyle's consulting company prior to the commencement of
    his employment.
 
     Option Grants. The following table sets forth certain information regarding
options granted by the Company to the Named Executive Officers during 1997.
 
                       OPTION GRANTS IN LAST FISCAL YEAR
 
<TABLE>
<CAPTION>
                                                              INDIVIDUAL GRANTS
                                           --------------------------------------------------------        POTENTIAL
                                                            PERCENT OF                                  REALIZABLE VALUE
                                                              TOTAL                                    AT ASSUMED ANNUAL
                                             NUMBER OF       OPTIONS                                     RATES OF STOCK
                                              SHARES        GRANTED TO                                 PRICE APPRECIATION
                                            UNDERLYING      EMPLOYEES      EXERCISE                     FOR OPTION TERM
                                              OPTIONS       IN FISCAL        PRICE       EXPIRATION    ------------------
                  NAME                      GRANTED (#)        YEAR        ($/SHARE)        DATE       5% ($)     10% ($)
----------------------------------------   -------------    ----------    -----------    ----------    -------    -------
<S>                                        <C>              <C>           <C>            <C>           <C>        <C>
John P. Dugan...........................       --             --             --             --           --         --
Charles T. Saldarini....................       --             --             --             --           --         --
Steven K. Budd..........................                       58.3%        $             12/31/05     $          $
Bernard C. Boyle........................                       41.7%        $             12/31/05     $          $
Robert Wynne............................       --             --             --             --           --         --
</TABLE>
 
                                       39

<PAGE>
     Option Exercises and Year-End Option Values. The following table provides
information with respect to options exercised by the Named Executive Officers
during 1997 and the number and value of unexercised options held by the Named
Executive Officers as of December 31, 1997.
 
   AGGREGATED OPTION EXERCISE IN LAST FISCAL YEAR AND YEAR-END OPTION VALUES
 
<TABLE>
<CAPTION>
                                                                   NUMBER OF SHARES UNDERLYING      VALUE OF UNEXERCISED IN-THE-
                                                                  UNEXERCISED OPTIONS AT FISCAL       MONEY OPTIONS AT FISCAL
                                                                          YEAR-END (#)                    YEAR-END ($)(1)
                            SHARES ACQUIRED   VALUE REALIZED    ---------------------------------   ----------------------------
NAME                        ON EXERCISE (#)       ($)(1)          EXERCISABLE      UNEXERCISABLE    EXERCISABLE    UNEXERCISABLE
--------------------------  ---------------   ---------------   ---------------   ---------------   -----------    -------------
<S>                         <C>               <C>               <C>               <C>               <C>            <C>
John P. Dugan.............      --                --                --                --               --              --
Charles T. Saldarini......      --                --                --                --               --              --
Steven K. Budd............      --                --
Bernard C. Boyle..........      --                --
Robert Wynne..............      --                --                --                --               --              --
</TABLE>
 
------------------------
(1) For the purposes of this calculation, value is based upon the difference
    between the exercise price and $_____ per share, the fair market value of
    the Common Stock as determined by the Board of Directors.
 
EMPLOYMENT CONTRACTS
 
     In January 1998, the Company entered into an employment agreement with John
P. Dugan providing for his employment as Chairman of the Board and Director of
Strategic Planning. The Agreement provides for an annual salary of $125,000 and
no cash bonuses and for participation in all executive benefit plans.
 
     In _________ 199__, the Company entered into an employment agreement with
Charles T. Saldarini providing for his employment, effective upon the closing of
this Offering, as President and Chief Executive Officer for a term expiring on
___________ _____, 200_. The Agreement provides for an annual base salary of
$_________ and for participation in all executive benefit plans. The agreement
also provides, among other things, that, if his employment is terminated without
cause (as defined in the agreement), the Company will pay him an amount equal to
the salary which would have been payable to him over the unexpired term of his
employment agreement.
 
     The Company has also entered into employment agreements with each of
Messrs. Boyle and Budd, providing for their respective employment, effective
upon the closing of this Offering, as Chief Financial Officer and Chief
Operating Officer, for terms expiring on ______ __, 200_. The agreements provide
for an annual base salary of $_____ for Mr. Boyle and $__________ for Mr. Budd
and for their participation in all executive benefit plans. Each agreement also
provides, among other things, that, if employment is terminated by the Company
without cause (as defined), the Company will pay the employee an amount equal to
the salary which would have been payable over the unexpired term of the
employment agreement.
 
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION IN COMPENSATION
DECISIONS
 
     Prior to this Offering, the Company has had no separate Compensation
Committee or other committee performing equivalent functions. As a result,
compensation matters were performed by the Board of Directors or senior
management. None of the Directors expected to serve on the Compensation
Committee is an employee of the Company, and neither the Chief Executive Officer
nor any other executive officer will serve on the Compensation Committee. No
Director or executive officer of the company is a Director or executive officer
of any other corporation that has a director or executive officer who is also a
Director of the Company.
 
1998 STOCK OPTION PLAN
 
     In __________, 1998, in order to attract and retain persons necessary for
the success of the Company, the Company adopted its 1998 Stock Option Plan (the
'Plan') covering up to __________ of its Common Shares, pursuant to which
officers, directors and key employees of the Company and consultants to the
Company are eligible to receive incentive and/or non-qualified stock options.
The Plan, which expires in October 2008, will be administered by the Board of
Directors or a committee designated by the Board of Directors. The selection of
participants, allotment of shares, determination of price and other conditions
relating to the purchase of options will be determined by the Board of
Directors, or a committee thereof, in its sole discretion. Incentive stock
options granted under the Plan are exercisable for a period of up to 10 years
from the date of grant at an exercise price which is not less than the fair
market value of the Common Stock on the date of the grant, except that the term
of an incentive stock option granted under the Plan to a shareholder owning more
than 10% of the
 
                                       40

<PAGE>
outstanding Common Stock may not exceed five years and its exercise price may
not be less than 110% of the fair market value of the Common Stock on the date
of the grant. At February 1, 1998 options for an aggregate of ________ shares,
exercisable at a price of $______ per share during a ten-year period had been
granted to Bernard C. Boyle and Steven K. Budd, and were outstanding under the
Plan. These options are exercisable for one-third of the shares covered thereby
as of the earlier of June 30, 1998 or the completion of this Offering and for an
additional one-third of the shares covered thereby each year thereafter. No
other options have been granted or exercised under the Plan. However,
immediately after the consummation of the Offering, the Company intends to grant
approximately __________ incentive stock options to approximately __________
employees. Such options will, generally, vest over three years and will be
exercisable at the public offering price. Options for ________ shares will be
granted to each of the Company's three outside directors upon their taking
office immediately following the closing of the Offering.
 
COMPENSATION OF DIRECTORS
 
     Each non-employee member of the Board of Directors will receive an annual
director's fee of $_____ plus $______ for each meeting attended and
reimbursement for travel costs and other out-of-pocket expenses incurred in
attending each Directors' meeting. In addition, committee members will receive
$__________ for each committee meeting attended. Additionally, pursuant to the
1998 Stock Option Plan each non-employee Director upon election to the Board
will receive options to purchase _____ shares of Common Stock exercisable at the
fair market value on the date of grant and additionally will receive automatic
grants of options to purchase ______ shares of Common Stock at the beginning of
each calendar year. See '-- 1998 Stock Option Plan.'
 
401(K) PLAN
 
     The Company maintains a retirement plan (the '401(k) Plan') intended to
qualify under Sections 401(a) and 401(k) of the Code. The 401(k) Plan is a
defined contribution plan that covers employees of the Company at least 21 years
of age, who have been employed by the Company for at least one year. Employees
may contribute up to 15% of their annual wages (subject to an annual limit
prescribed by the Code) as pre-tax salary deferral contributions. Effective
January 1, 1997, the Company committed to make mandatory contributions to the
401(k) Plan to match employee contributions up to a maximum of 2% of each
participating employee's annual wages. The Company's contribution to the 401(k)
Plan for 1997 was approximately $172,000.
 
LIMITATION OF DIRECTORS' LIABILITY AND INDEMNIFICATION
 
     The DGCL authorizes corporations to limit or eliminate the personal
liability of directors to corporations and their shareholders for monetary
damages for breach of directors' fiduciary duty of care. The Company's
Certificate of Incorporation limits the liability of directors of the Company to
the Company or its shareholders to the fullest extent permitted by Delaware law.
See 'Description of Capital Stock -- Certain Provisions of the Company's
Certificate of Incorporation and Bylaws.'
 
     The Company's Certificate of Incorporation provides mandatory
indemnification rights to any officer or Director of the Company who, by reason
of the fact that he or she is an officer or Director of the Company, is involved
in a legal proceeding of any nature. Such indemnification rights include
reimbursement for expenses incurred by such officer or Director in advance of
the final disposition of such proceeding in accordance with the applicable
provisions of the DGCL. Insofar as indemnification for liabilities under the
Securities Act may be provided to officers and Directors or persons controlling
the Company, the Company has been informed that in the opinion of the Securities
and Exchange Commission (the 'Commission'), such indemnification is against
public policy as expressed in the Securities Act and is, therefore,
unenforceable.
 
     There is no pending litigation or proceeding involving a Director, officer,
employee or agent of the Company in which indemnification by the Company will be
required or permitted. The Company is not aware of any threatened litigation or
proceeding that may result in a claim for such indemnification.
 
                                       41

<PAGE>
                              CERTAIN TRANSACTIONS
 
     During 1997, Boomer & Son, Inc. ('B&S'), a corporation which prior to 1998
was wholly-owned by John P. Dugan, the Company's Chairman of the Board, provided
advertisement production and placement services to the Company. Mr. Dugan is not
actively involved in B&S's business. The Company purchased advertising in the
amount of $1.6 million through B&S at stated advertising rates set by the
periodicals and publications in which advertisements were placed. B&S received a
commission from the publications for its placement services. In addition, in
1997 B&S repaid approximately $196,000 of advances made to it by the Company in
1996. At December 31, 1997 the net amount due from B&S was approximately
$27,000. See note 8 to the Company's Financial Statements. The Company
anticipates that this amount will be repaid prior to the Offering.
 
     At the end of 1997 Mr. Dugan transferred his interest in B&S to his son and
daughter-in-law. The Company and B&S propose to enter into an agreement pursuant
to which B&S will continue to place advertising on behalf of the Company with
various media. As of February 1, 1998 the total amount of advertising placed by
B&S on behalf of the Company in 1998 was approximately $180,000. The Company
believes that the amounts paid to B&S were no less favorable than would be
available in an arms-length negotiated transaction with an unaffiliated entity.
See note 8 to the Company's Financial Statements.
 
     The Company and Charles T. Saldarini entered into an employment agreement
as of January 1, 1997, which provided for, among other things, an outright grant
of shares of Common Stock to Mr. Saldarini. As a result of such grant, Mr.
Saldarini owns 15.0% of the outstanding shares of Common Stock immediately prior
to the Offering. In connection with such grant, the Company incurred a non-cash,
non-recurring expense of $4.5 million for financial reporting purposes.
 
     The Company has been subject to taxation under Subchapter S of the Code
since January 1, 1991 and under the corresponding provisions of the tax laws of
the State of New Jersey since January 1, 1994. As a result, the net income of
the Company, for Federal and New Jersey state income tax purposes, has been
reported by and taxable directly to the Company's shareholders rather than to
the Company. In 1996, the Company paid approximately $1.5 million to Mr. Dugan,
its Chief Executive Officer and sole shareholder as bonus compensation. In 1997,
the Company paid an aggregate of approximately $2.48 million of bonus
compensation to its shareholder-employees, Mr. Dugan and Charles T. Saldarini,
its President. The Company's S Corporation tax status will terminate upon the
consummation of this Offering. Immediately prior to this Offering, the Company
will make a final distribution (consisting of an aggregate of approximately
$______ million in cash payments) to its shareholders. This payment represents
the shareholders' equity in the Company prior to the conversion date.
 
                                       42

<PAGE>
                             PRINCIPAL SHAREHOLDERS
 
     The following table sets forth certain information known to the Company
regarding the beneficial ownership of Common Stock as of December 31, 1997 and
as adjusted to reflect the sale of the shares offered hereby, by (i) each person
known to the Company to be the beneficial owner of more than 5% of its
outstanding shares of Common Stock, (ii) each Director and Director Nominee of
the Company, (iii) each Named Executive Officer and (iv) all Directors, Director
Nominees and Named Executive Officers of the Company as a group. Except as
otherwise indicated, the persons or entities listed below have sole voting and
investment power with respect to all shares of Common Stock owned by them.
 
<TABLE>
<CAPTION>
                                                                                              PERCENTAGE OF SHARES
                                                                                              BENEFICIALLY OWNED(2)
                                                                 NUMBER OF SHARES       ---------------------------------
NAME AND ADDRESS(1)                                            BENEFICIALLY OWNED(2)    BEFORE OFFERING    AFTER OFFERING
------------------------------------------------------------   ---------------------    ---------------    --------------
<S>                                                            <C>                      <C>                <C>
John P. Dugan...............................................                                   85.0%
Charles T. Saldarini........................................                                   15.0%
Steven K. Budd..............................................                (3)                 *               *
Bernard C. Boyle............................................                (4)                 *               *
John M. Pietruski...........................................                (5)                   --            *
Jan Martens Vecsi...........................................                (5)                   --            *
Gerald J. Mossinghoff.......................................                (5)                   --            *
All Officers, Directors and Director Nominees as a group (9
  persons)..................................................                (6)               100.0%
                                                               ---------------------    ---------------    --------------
</TABLE>
 
------------------
 
<TABLE>
<S>   <C>
*     Less than 1%.
(1)   The addresses of Messrs. Dugan and Saldarini are c/o the Company, 599 MacArthur Boulevard, Mahwah, New Jersey
      07430-2326.
(2)   Pursuant to the rules of the Commission, shares of the Company's Common Stock that a person has the right to
      acquire within 60 days of the date hereof pursuant to the exercise of stock options are deemed to be
      outstanding for the purpose of computing the percentage ownership of such person but are not deemed
      outstanding for the purpose of computing the percentage ownership of any other person.
(3)   Represents ____ shares issuable pursuant to options exercisable within 60 days of the date hereof.
(4)   Represents ____ shares issuable pursuant to options exercisable within 60 days of the date hereof.
(5)   Represents ____ shares issuable pursuant to options exercisable within 60 days of the date hereof.
(6)   Includes ____ shares issuable pursuant to options exercisable within 60 days of the date hereof.
</TABLE>
 
     All of the shares of Common Stock set forth in the above table are subject
to agreements prohibiting the sale, assignment or transfer for 180 days from the
date of this Prospectus without the prior written consent of Morgan Stanley &
Co. Incorporated. See 'Underwriting.'
 
                                       43

<PAGE>
                          DESCRIPTION OF CAPITAL STOCK
 
     The Company's authorized capital stock consists of 30,000,000 shares of
Common Stock, par value of $.01 per share ('Common Stock'), and 5,000,000 shares
of Preferred Stock, par value of $.01 per share ('Preferred Stock'). Upon
completion of the Offering, there will be ________ shares of Common Stock
outstanding and no shares of Preferred Stock outstanding. As of December 31,
1997, there were outstanding ________ shares of Common Stock held of record by
two stockholders. In addition, at December 31, 1997, there were outstanding
options to purchase ______ shares of Common Stock.
 
COMMON STOCK
 
     The holders of Common Stock are entitled to one vote for each share held of
record on all matters submitted to a vote of stockholders. Subject to the
preferences that may be applicable to any outstanding Preferred Stock, the
holders of Common Stock are entitled to receive dividends as and when declared
by the Board of Directors out of funds legally available for dividends, and, in
the event of liquidation, dissolution or winding up of the Company, to share
ratably in all assets remaining after the payment of liabilities. The Common
Stock has no preemptive, conversion or other subscription rights. All
outstanding shares of Common Stock are fully paid and nonassessable.
 
PREFERRED STOCK
 
     The Board of Directors is authorized to issue the undesignated Preferred
Stock in one or more series, to determine the powers, preferences and rights,
and the qualifications, limitations or restrictions, granted to or imposed upon
any wholly unissued series of undesignated Preferred Stock, and to fix the
number of shares constituting any series and the designation of such series,
without any further vote or action by the shareholders. The issuance of
Preferred Stock may have the effect of delaying, deferring or preventing a
change in control of the Company and may adversely affect the voting and other
rights of the holders of Common Stock.
 
CERTAIN PROVISIONS OF THE COMPANY'S CERTIFICATE OF INCORPORATION AND BYLAWS
 
     The Company's Certificate of Incorporation limits the liability of
directors of the Company to the fullest extent permitted under Section 102(b)(7)
of the DGCL. To this end, no director of the Company will be liable to the
Company or to its shareholders for monetary damages for breach of fiduciary duty
as a director, except for liability for (i) any breach of the director's duty of
loyalty to the Company or its shareholders, (ii) acts or omissions not in good
faith or which involve intentional misconduct or a knowing violation of the law,
(iii) any willful or negligent payment of an unlawful dividend, stock purchase,
or redemption or (iv) any transaction from which the director derived an
improper personal benefit.
 
     The Certificate of Incorporation provides that the Board of Directors
consist of three classes of directors serving for staggered three-year terms. As
a result, one-third of the Company's Board of Directors will be elected each
year. In accordance with the DGCL, directors serving on classified boards of
directors may only be removed from office for cause. The Certificate of
Incorporation provides that shareholders may take such action only by the
affirmative vote of at least 66 2/3% of the voting stock outstanding.
 
     The Company's Bylaws provide that only the Board of Directors may call a
special meeting of shareholders and that shareholders must follow an advance
notification procedure for certain shareholder nominations of candidates and for
certain other shareholder business to be conducted at the annual meeting. These
provisions could, under certain circumstances, operate to delay, defer or
prevent a change in control of the Company.
 
     These provisions could delay or frustrate the removal of incumbent
directors or a change in control of the Company. The provisions also could
discourage, impede or prevent a merger, tender offer or proxy contest, even if
such event would be favorable to the interests of shareholders.
 
SECTION 203 OF THE DGCL
 
     As a corporation organized under the laws of the State of Delaware, the
Company is subject to Section 203 of the DGCL which restricts certain business
combinations between the Company and an 'interested stockholder' (in general, a
shareholder owning 15% or more of the Company's outstanding voting stock) or its
 
                                       44

<PAGE>
affiliates or associates for a period of three years following the date on which
the shareholder becomes an 'interested stockholder.' The restrictions do not
apply if (i) the corporation has elected in its certificate of incorporation not
to be governed by the Delaware anti-takeover law (the Company has not made such
an election), (ii) prior to a person qualifying as an 'interested stockholder,'
the Board of Directors approves either the business combination or the
transaction which would cause such individual to become an 'interested
stockholder,' (iii) upon consummation of the transaction in which any person
becomes an 'interested stockholder,' such person owns at least 85% of the voting
stock of the Company outstanding at the time the transaction commences
(excluding shares owned by certain employee stock ownership plans and persons
who are both directors and officers of the Company) or (iv) on or subsequent to
the date on which a person becomes an 'interested stockholder,' the business
combination is both approved by the Board of Directors and authorized at an
annual or special meeting of the Company's shareholders, without written
consent, by the affirmative vote of at least 66 2/3% of the outstanding voting
stock not owned by the 'interested stockholder.'
 
TRANSFER AGENT AND REGISTRAR
 
     The Transfer Agent and Registrar for the Company's Common Stock is American
Stock Transfer & Trust Company.
 
                                       45

<PAGE>
                        SHARES ELIGIBLE FOR FUTURE SALE
 
     Prior to the offering there has been no market for the Common Stock of the
Company. The Company can make no prediction as to the effect, if any, that sales
of shares or the availability of shares for sale will have on the market price
prevailing from time to time. Nevertheless, sales of significant amounts of the
Common Stock in the public market, or the perception that such sales may occur,
could adversely affect prevailing market prices. See 'Risk Factors -- Shares
Eligible for Future Sale.'
 
     Upon completion of the Offering, the Company will have __________ shares of
Common Stock outstanding (excluding _________ shares reserved for issuance upon
the exercise of outstanding stock options) (________ shares of Common Stock
outstanding if the Underwriters' over-allotment option is exercised in full). Of
these shares, the _________ shares offered hereby will be freely tradable
without restrictions or further registration under the Securities Act, except
for any shares purchased by 'affiliates' of the Company, as that term is defined
in Rule 144 under the Securities Act ('Affiliates'), which will be subject to
the resale limitations imposed by Rule 144, as described below. The remaining
__________ shares of Common Stock held by existing shareholders are 'restricted
securities' within the meaning of Rule 144 and may not be resold in the absence
of registration under the Securities Act or pursuant to exemptions from such
registration including, among others, the exemption provided by Rule 144 under
the Securities Act ('Restricted Shares'). Restricted Shares may be sold in the
public market only if registered or if they qualify for an exemption from
registration under Rule 144 or 701 promulgated under the Securities Act, which
rules are summarized below. All officers, directors, shareholders and option
holders of the Company have agreed not to offer, pledge, sell, contract to sell,
sell any option or contract to purchase, purchase any option or contract to
sell, grant any option, right or warrant to purchase, or otherwise transfer or
dispose of, directly or indirectly (or enter into any swap or other arrangement
that transfers to another, in whole or in part, any of the economic consequences
of ownership of), any shares of Common Stock or any securities convertible into
or exercisable or exchangeable for shares of Common Stock, for a period of 180
days after the date of this Prospectus, without the prior written consent of
Morgan Stanley & Co. Incorporated. Morgan Stanley & Co. Incorporated may in its
sole discretion choose to release a certain number of these shares from such
restrictions prior to the expiration of such 180 day period. As a result of such
contractual restrictions and the provisions of Rule 144 and 701, the Restricted
Shares will be available for sale in the public market as follows: (i) no such
shares will be eligible for immediate sale on the date of this Prospectus; and
(ii) all of such shares will be eligible for sale upon expiration of the lock-up
agreements 180 days after the date of this Prospectus, subject to the volume
limitations and other conditions of Rule 144 described below.
 
     In general, under Rule 144 as currently in effect, beginning 90 days after
the date of this Prospectus, a person (or persons whose shares are required to
be aggregated) whose restricted securities have been outstanding for at least
one year, including a person who may be deemed an 'affiliate' of the Company,
may only sell a number of shares within any three-month period which does not
exceed the greater of (i) one percent of the then outstanding shares of the
Company's Common Stock (approximately ________ shares after the Offering,
_________ if the over-allotment option is exercised in full) or (ii) the average
weekly trading volume in the Company's Common Stock in the four calendar weeks
immediately preceding such sale. Sales under Rule 144 are also subject to
certain requirements as to the manner of sale, notice and the availability of
current public information about the Company. A person who is not an affiliate
of the issuer, has not been an affiliate within three months prior to the sale
and has owned the restricted securities for at least two years is entitled to
sell such shares under Rule 144(k) without regard to any of the limitations
described above.
 
     Beginning 90 days after the date of this Prospectus, certain shares issued
or issuable upon the exercise of options granted by the Company prior to the
date of this Prospectus will also be eligible for sale in the public market
pursuant to Rule 701 under the Act. In general, Rule 701 permits resales of
shares issued pursuant to certain compensatory benefit plans and contracts
commencing 90 days after the issuer becomes subject to the reporting
requirements of the Securities Exchange Act of 1934, as amended, in reliance
upon Rule 144, but without compliance with certain restrictions of Rule 144,
including the holding period requirements. As of December 31, 1997, the Company
has granted options covering _______ shares of Common Stock which have not been
exercised and which become exercisable at various times in the future. Any
shares of Common Stock issued upon the exercise of these options will be
eligible for sale pursuant to Rule 701.
 
                                       46

<PAGE>
     The Company intends to file a registration statement under the Securities
Act covering _______ shares of Common Stock reserved for issuance under the 1998
Stock Option Plan. Such registration statement is expected to be filed and
become effective as soon as practicable after the effective date of this
Offering. Accordingly, shares registered under such registration statement will,
subject to Rule 144 volume limitations applicable to Affiliates, be available
for sale in the open market unless such shares are subject to vesting
restrictions with the Company.
 
                                  UNDERWRITERS
 
     Under the terms and subject to the conditions in the Underwriting Agreement
dated the date hereof (the 'Underwriting Agreement'), the Underwriters named
below (the 'Underwriters'), for whom Morgan Stanley & Co. Incorporated, William
Blair & Company, L.L.C. and Hambrecht & Quist LLC are serving as Representatives
(the 'Representatives'), have severally agreed to purchase, and the Company has
agreed to sell to the Underwriters, severally, the respective number of shares
of Common Stock set forth opposite the names of such Underwriters below:
 
<TABLE>
<CAPTION>
                                                                                              NUMBER
NAME                                                                                        OF SHARES
---------------------------------------------------------------------------------------     ----------
<S>                                                                                         <C>
Morgan Stanley & Co. Incorporated......................................................
William Blair & Company, L.L.C.........................................................
Hambrecht & Quist LLC..................................................................
                                                                                            ----------
 
     Total.............................................................................
                                                                                            ----------
                                                                                            ----------
</TABLE>
 
     The Underwriting Agreement provides that the obligations of the several
Underwriters to pay for and accept delivery of the shares of Common Stock
offered hereby are subject to the approval of certain legal matters by their
counsel and to certain other conditions. The Underwriters are obligated to take
and pay for all the shares of Common Stock offered hereby (other than those
covered by the over-allotment option described below) if any such shares are
taken.
 
     The Underwriters initially propose to offer part of the shares of Common
Stock directly to the public at the public offering price set forth on the cover
page hereof and part to certain dealers at a price which represents a concession
not in excess of $  a share under the public offering price. Any Underwriter may
allow, and such dealers may reallow, a concession not in excess of $  a share to
other Underwriters or to certain other dealers. After the initial offering of
the shares of Common Stock, the offering price and other selling terms may from
time to time be varied by the Underwriters.
 
     The Company has granted the Underwriters an option, exercisable for 30 days
from the date of the Prospectus, to purchase up to _________ additional shares
of Common Stock at the public offering price set forth on the cover page hereof,
less underwriting discounts and commissions. The Underwriters may exercise such
option to purchase solely for the purpose of covering over-allotments, if any,
made in connection with the offering of the shares of Common Stock offered
hereby. To the extent such option is exercised, each Underwriter will become
obligated, subject to certain conditions, to purchase approximately the same
percentage of such additional shares as the number set forth next to such
Underwriter's name in the preceding table bears to the total number of shares of
Common Stock offered by the Underwriters hereby.
 
                                       47

<PAGE>
     See 'Shares Eligible for Future Sale' for a description of certain
arrangements by which all of the Company's executive officers and directors and
certain other existing shareholders have agreed not to sell or otherwise dispose
of Common Stock or convertible securities of the Company for up to 180 days
after the date of this Prospectus without the prior written consent of Morgan
Stanley & Co. Incorporated. The Company has agreed in the Underwriting Agreement
that it will not, directly or indirectly, without the prior written consent of
Morgan Stanley & Co. Incorporated, contract to sell, sell any option or contract
to purchase, purchase any option or contract to sell, grant any option, right or
warrant to purchase, lend or otherwise transfer or dispose of any shares of
Common Stock or any securities convertible into or exchangeable for Common
Stock, for a period of 180 days after the date of this Prospectus, except under
certain circumstances.
 
     At the request of the Company, the Underwriters have reserved for sale at
the initial public offering price up to _________ shares offered hereby for
officers, directors, employees and certain other persons associated with the
Company. The number of shares available for sale to the general public will be
reduced to the extent such persons purchase such reserved shares. Any reserved
shares not so purchased will be offered by the Underwriters to the general
public on the same basis as the other shares offered hereby.
 
     The Representatives have informed the Company that the Underwriters do not
intend to confirm sales in excess of five percent of the total number of shares
of Common Stock offered hereby to accounts over which they exercise
discretionary authority.
 
     The Company and the Underwriters have agreed to indemnify each other
against certain liabilities, including liabilities under the Securities Act.
 
     Application has been made to list the Common Stock for quotation on the
Nasdaq National Market under the symbol 'PDII.'
 
     In order to facilitate the offering of the Common Stock, the Underwriters
may engage in transactions that stabilize, maintain or otherwise affect the
price of the Common Stock. Specifically, the Underwriters may overallot in
connection with the Offering, creating a short position in the Common Stock for
their own account. In addition, to cover over-allotments or to stabilize the
price of the Common Stock, the Underwriters may bid for, and purchase, shares of
Common Stock in the open market. Finally, the underwriting syndicate may reclaim
selling concessions allowed to an underwriter or a dealer for distributing the
Common Stock in the offering, if the syndicate repurchases previously
distributed Common Stock in transactions to cover syndicate short positions, in
stabilization transactions or otherwise. Any of these activities may stabilize
or maintain the market price of the Common Stock above independent market
levels. The Underwriters are not required to engage in these activities, and may
cease any of these activities at any time.
 
PRICE OF THE OFFERING
 
     Prior to the Offering, there has been no public market for the Common
Stock. The initial public offering price for the Common Stock will be determined
by negotiations between the Company and the Representatives. Among the factors
considered in determining the initial public offering price will be the future
prospects of the Company and its industry in general; revenue, earnings and
certain other financial and operating information of the Company in recent
periods; and certain ratios, market prices of securities and certain financial
operating information of companies engaged in activities similar to those of the
Company. The estimated initial public offering price range set forth on the
cover page of this Prospectus is subject to change as a result of market
conditions or other factors.
 
                                 LEGAL MATTERS
 
     The validity of the Common Stock offered hereby will be passed upon for the
Company by Morse, Zelnick, Rose & Lander, LLP, 450 Park Avenue, New York, New
York 10022 and for the Underwriters by Ropes & Gray, One International Place,
Boston, Massachusetts 02110. Certain matters relating to rules and regulations
promulgated by the FDA and other regulatory matters will be passed upon for the
Company by Farkas & Manelli, P.L.L.C., 1233 20th Street, N.W. Suite 700,
Washington, D.C. 20036-2396.
 
                                       48

<PAGE>
                                    EXPERTS
 
     The balance sheets as of December 31, 1997 and 1996 and the statements of
operations, cash flows and shareholders' equity for each of the three years in
the period ended December 31, 1997 included in this Prospectus, have been
included herein in reliance on the report of Coopers & Lybrand L.L.P.,
independent accountants, given on the authority of that firm as experts in
accounting and auditing.
 
                             ADDITIONAL INFORMATION
 
     The Company has filed with the Securities and Exchange Commission (the
'Commission') a Registration Statement on Form S-1 under the Securities Act,
with respect to the Common Stock offered hereby. As permitted by the rules and
regulations of the Commission, this Prospectus, which is part of the
Registration Statement, omits certain information, exhibits, schedules and
undertakings set forth in the Registration Statement. For further information
pertaining to the Company and the Common Stock, reference is made to such
Registration Statement and the exhibits and schedules thereto. Statements
contained in this Prospectus as to the contents or provisions of any documents
referred to herein are not necessarily complete, and in each instance where a
copy of the document has been filed as an exhibit to the Registration Statement,
reference is made to the exhibit so filed. The Registration Statement may be
inspected without charge at the office of the Commission at 450 Fifth Street,
N.W., Washington, D.C. 20549. Copies of the Registration Statement may be
obtained from the Commission at prescribed rates from the Public Reference
Section of the Commission at such address, and at the Commission's regional
offices located at 7 World Trade Center, 13th Floor, New York, New York 10048,
and at Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois
60661. In addition, registration statements and certain other filings made with
the Commission through its Electronic Data Gathering, Analysis and Retrieval
('EDGAR') system are publicly available through the Commission's site on the
Internet's World Wide Web, located at http://www.sec.gov. The Registration
Statement, including all exhibits thereto and amendments thereof, has been filed
with the Commission through EDGAR.
 
                                       49

<PAGE>
                         INDEX TO FINANCIAL STATEMENTS
 
<TABLE>
<CAPTION>
                                                                                                              PAGE
                                                                                                              ----
 
<S>                                                                                                           <C>
PROFESSIONAL DETAILING, INC.:
 
     Report of Independent Accountants.....................................................................    F-2
 
     Balance Sheets........................................................................................    F-3
 
     Statements of Operations..............................................................................    F-4
 
     Statements of Cash Flows..............................................................................    F-5
 
     Statements of Shareholders' Equity....................................................................    F-6
 
     Notes to Financial Statements.........................................................................    F-7
</TABLE>
 
                                      F-1

<PAGE>
After the merger discussed in Note 2 to the Financial Statements is effected, we
will be in a position to render the following report.
 
                                          /s/ Coopers & Lybrand L.L.P.
 
Parsippany, New Jersey
February 3, 1998
 
                       REPORT OF INDEPENDENT ACCOUNTANTS
                            ------------------------
 
To the Stockholders and
Board of Directors of Professional Detailing, Inc.:
 
     We have audited the accompanying balance sheets of Professional Detailing,
Inc. as of December 31, 1997 and 1996, and the related statements of operations,
cash flows and shareholders' equity for each of the three years in the period
ended December 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 finanicial 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 Professional Detailing, Inc.
as of December 31, 1997 and 1996, and the results of their operations and their
cash flows for the three years in the period ended December 31, 1997, in
conformity with generally accepted accounting principles.
 
Parsippany, New Jersey
February 3, 1998, except as
to the information presented
in Note 2, for which the date
is                   .
 
                                      F-2

<PAGE>
                          PROFESSIONAL DETAILING, INC.
                                 BALANCE SHEETS
 
<TABLE>
<CAPTION>
                                                                                      DECEMBER 31,
                                                                        ----------------------------------------
                                                                                                     PRO FORMA
                                                                           1996          1997           1997
                                                                        ----------    -----------    -----------
                                                                                                     (UNAUDITED)
<S>                                                                     <C>           <C>            <C>
ASSETS
Current Assets:
Cash and Cash Equivalents............................................   $2,403,011    $ 5,759,918    $ 5,084,197
Contract Payments Receivable.........................................    3,037,566      2,073,356      2,073,356
Unbilled Costs and Accrued Profits on Contracts in Progress..........    2,372,518      4,986,454      4,986,454
Receivable from Affiliates, net......................................       84,327         27,161         27,161
Other Current Assets.................................................       30,000        297,032        297,032
                                                                        ----------    -----------    -----------
     Total Current Assets............................................    7,927,422     13,143,921     12,468,200
  Net Property, Plant & Equipment:...................................      395,062        547,377        547,377
                                                                        ----------    -----------    -----------
Total Assets.........................................................   $8,322,484    $13,691,298    $13,015,577
                                                                        ----------    -----------    -----------
                                                                        ----------    -----------    -----------
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts Payable.....................................................   $  608,895    $   473,832    $   473,832
Notes Payable........................................................           --         68,365         68,365
Accrued Incentives...................................................    2,905,506      2,806,839      2,806,839
Accrued Salaries and Wages...........................................      896,202      1,417,789      1,417,789
Unearned Contract Revenue............................................    3,925,853      6,131,322      6,131,322
Other Accrued Expenses...............................................      463,754      2,117,330      2,117,330
                                                                        ----------    -----------    -----------
     Total Current Liabilities.......................................    8,800,210     13,015,477     13,015,477
                                                                        ----------    -----------    -----------
Commitments and Contingencies
Shareholders' Equity:
Capital Stock, no par value;
  2,500 shares authorized; shares issued and outstanding,
  1996 -- 100; 1997 -- 100...........................................          100            100            100
Additional Paid-In Capital...........................................           --      4,193,852        101,822
Retained Deficit.....................................................     (467,486)    (3,416,309)            --
Deferred Compensation................................................           --       (101,822)      (101,822)
Shareholder Loan.....................................................      (10,340)            --             --
                                                                        ----------    -----------    -----------
     Total Shareholders' Equity......................................     (477,726)       675,821            100
                                                                        ----------    -----------    -----------
Total Liabilities & Equity...........................................   $8,322,484    $13,691,298    $13,015,577
                                                                        ----------    -----------    -----------
                                                                        ----------    -----------    -----------
</TABLE>
 
   The accompanying notes are an integral part of these financial statements

                                      F-3

<PAGE>
                          PROFESSIONAL DETAILING, INC.

                            STATEMENTS OF OPERATIONS
 
<TABLE>
<CAPTION>
                                                                            FOR THE YEAR ENDED DECEMBER 31,
                                                                       -----------------------------------------
                                                                          1995           1996           1997
                                                                       -----------    -----------    -----------
<S>                                                                    <C>            <C>            <C>
Revenue.............................................................   $18,398,554    $33,014,960    $54,541,818
Less: Program Expenses, including related party amounts of $0,
  $671,810 and $1,564,606 for the periods ended December 31, 1995,
  1996 and 1997, respectively.......................................    15,427,428     26,886,445     43,057,196
                                                                       -----------    -----------    -----------
Gross Profit........................................................     2,971,126      6,128,515     11,484,622
Compensation Expense................................................     2,124,470      3,190,984      5,120,969
Bonus to Majority Shareholder.......................................       425,000      1,500,000      2,243,000
Stock Grant Expense.................................................            --             --      4,470,000
Other General, Selling & Administrative Expenses....................     1,158,475      1,650,049      2,754,522
                                                                       -----------    -----------    -----------
Total General, Selling & Administrative Expenses....................     3,707,945      6,341,033     14,588,491
                                                                       -----------    -----------    -----------
Operating Loss......................................................      (736,819)      (212,518)    (3,103,869)
Other Income, Net...................................................        69,981         98,072        155,046
                                                                       -----------    -----------    -----------
Net Loss............................................................   $  (666,838)   $  (114,446)   $(2,948,823)
                                                                       -----------    -----------    -----------
                                                                       -----------    -----------    -----------
Pro Forma Data (unaudited) (see note 3)
  Net Loss, as reported.............................................      (666,838)      (114,446)    (2,948,823)
Pro Forma Income Tax Benefit........................................       120,969             --             --
                                                                       -----------    -----------    -----------
Pro Forma Net Loss..................................................   $  (545,869)   $  (114,446)   $(2,948,823)
                                                                       -----------    -----------    -----------
                                                                       -----------    -----------    -----------
Pro Forma Net Income (Loss) Per Share...............................
                                                                                                     -----------
                                                                                                     -----------
Pro Forma Weighted Average Shares Outstanding.......................
                                                                                                     -----------
                                                                                                     -----------
</TABLE>
 
   The accompanying notes are an integral part of these financial statements

                                      F-4

<PAGE>
                          PROFESSIONAL DETAILING, INC.

                            STATEMENTS OF CASH FLOWS
 
<TABLE>
<CAPTION>
                                                                             FOR THE YEAR ENDED DECEMBER 31,
                                                                         ----------------------------------------
                                                                            1995           1996          1997
                                                                         -----------    ----------    -----------
<S>                                                                      <C>            <C>           <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net Loss From Operations..............................................   $  (666,838)   $ (114,446)   $(2,948,823)
     Adjustments to reconcile net loss to net cash provided by/(used
       in) operating activities:
       Depreciation...................................................        85,040       104,531        137,852
       Non-Cash Compensation Expense -- Stock Grant to Officer........            --            --      4,050,000
       Non-Cash Compensation Expense -- Stock Options.................            --            --         42,030
     Other changes in assets and liabilities:
       (Increase) decrease in contract payments receivable............     2,779,325      (188,033)       964,210
       (Increase) decrease in unbilled costs..........................    (2,138,421)      138,271     (2,613,936)
       (Increase) decrease in other current assets....................       136,354        22,253       (267,032)
       Increase (decrease) in trade accounts payable..................       538,152        55,743       (135,063)
       Increase in accrued liabilities................................       825,228     2,522,659        422,920
       Increase (decrease) in unearned contract revenue...............    (1,721,519)     (382,536)     2,205,469
       Increase (decrease) in payable to affiliate....................            --       284,877       (138,859)
       Increase (decrease) in other current liabilities...............       (68,947)      360,107      1,653,576
                                                                         -----------    ----------    -----------
Net Cash Provided By/(Used In) Operating Activities...................      (231,626)    2,803,426      3,372,344
                                                                         -----------    ----------    -----------
 
CASH FLOWS PROVIDED BY/(USED IN) INVESTING ACTIVITIES
       Purchase of equipment..........................................      (139,415)     (271,503)      (290,167)
       Advances to affiliate..........................................            --      (369,204)            --
       Repayments of advances from affiliate..........................            --            --        196,025
                                                                         -----------    ----------    -----------
Net Cash Provided By/(Used In) Investing Activities...................      (139,415)     (640,707)       (94,142)
                                                                         -----------    ----------    -----------
 
CASH FLOWS PROVIDED BY/(USED IN) FINANCING ACTIVITIES
  Proceeds from issuance of note payable..............................            --            --        100,000
  Payments on note payable............................................            --            --        (31,635)
  Repayment of shareholder loan.......................................            --            --         10,340
                                                                         -----------    ----------    -----------
Net Cash Provided By/(Used In) Financing Activities...................            --            --         78,705
                                                                         -----------    ----------    -----------
Net Increase/(Decrease) In Cash And Cash Equivalents..................      (371,041)    2,162,719      3,356,907
Cash And Cash Equivalents -- Beginning                                       611,333       240,292      2,403,011
                                                                         -----------    ----------    -----------
Cash And Cash Equivalents -- Ending                                      $   240,292    $2,403,011    $ 5,759,918
                                                                         -----------    ----------    -----------
                                                                         -----------    ----------    -----------
Cash Paid for Interest................................................            --            --    $     7,179
                                                                         -----------    ----------    -----------
                                                                         -----------    ----------    -----------
</TABLE>
 
   The accompanying notes are an integral part of these financial statements

                                      F-5

<PAGE>
                          PROFESSIONAL DETAILING, INC.

                       STATEMENT OF SHAREHOLDERS' EQUITY
 
<TABLE>
<CAPTION>
                                          COMMON STOCK
                                      --------------------                                ADDITIONAL
                                      OUTSTANDING              DEFERRED     SHAREHOLDER    PAID IN          RETAINED
                                        SHARES      AMOUNT   COMPENSATION      LOAN        CAPITAL     EARNINGS/(DEFICIT)
                                      -----------   ------   ------------   -----------   ----------   ------------------
<S>                                   <C>           <C>      <C>            <C>           <C>          <C>
Balance -- December 31, 1994........         100     $100             --       (10,340)           --           313,798
Net loss for the year ended December
  31, 1995..........................          --       --             --            --            --          (666,838)
                                      -----------   ------   ------------   -----------   ----------   ------------------
Balance -- December 31, 1995........         100     $100     $       --     $ (10,340)   $       --      $   (353,040)
Net loss for the year ended December
  31, 1996..........................          --       --             --            --            --          (114,446)
                                      -----------   ------   ------------   -----------   ----------   ------------------
Balance -- December 31, 1996........         100      100             --       (10,340)           --          (467,486)
Stock Grant.........................          --       --             --            --     4,050,000                --
Deferred Compensation-Stock
  Options...........................          --       --       (101,822)           --       143,852                --
Repayment of shareholder loan.......          --       --             --        10,340            --                --
Net income for the year ended
  December 31, 1997.................          --       --             --            --            --        (2,948,823)
                                      -----------   ------   ------------   -----------   ----------   ------------------
Balance -- December 31, 1997........         100     $100     $ (101,822)    $       0    $4,193,852      $ (3,416,309)
                                      -----------   ------   ------------   -----------   ----------   ------------------
                                      -----------   ------   ------------   -----------   ----------   ------------------
</TABLE>
 
   The accompanying notes are an integral part of these financial statements

                                      F-6

<PAGE>
                          PROFESSIONAL DETAILING, INC.

                         NOTES TO FINANCIAL STATEMENTS
 
1. NATURE OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES
 
  Nature of Business
 
     Professional Detailing, Inc. (the 'Company') is a leading provider of
comprehensive customized sales solutions on an outsourced basis to the United
States pharmaceutical industry.
 
  Use of Estimates
 
     The preparation of financial statements in conformity with generally
accepted accounting principles requires the Company to make estimates and
assumptions that affect the amounts reported in the financial statements. Actual
results could differ from those estimates. Significant estimates include
revenues and costs associated with the contracts, which are used for purposes of
applying the percentage-of-completion method.
 
  Revenue Recognition
 
     Revenue is earned primarily by performing services under contracts with
clients and is recognized under the percentage of completion method. Revenue
includes estimated fees or profits to be earned pursuant to contracts calculated
on the basis of the relationship between program costs, excluding initial direct
program costs, and total estimated program costs, excluding initial direct
program costs. There are two significant categories of program costs: (i)
initial direct program costs, which are associated with the recruitment and
formal training of the sales representatives and managers so that they are
qualified to properly render the services specified in the contracts and (ii)
personnel costs, which are salaries and related fringe benefits for the
representatives and managers who are responsible for the direct performance of
the activities specified in the contracts. Initial direct costs associated with
the recruitment and training of representatives are deferred and recognized over
the life of the corresponding contracts.
 
     Estimated revenue and costs are reviewed and revised periodically
throughout the lives of the contracts, with adjustment to profits resulting from
such revisions being recorded on a cumulative basis in the period in which the
revisions are made. In the period in which it is determined that a loss results
from the performance of a contract, the entire amount of the estimated ultimate
loss is charged against income.
 
     The Company must continually replace its contracts with new contracts to
sustain its revenue. In addition, many of the Company's contracts may be
canceled or delayed by clients upon notice. Contracts generally may be
terminated for a variety of reasons, including failure to meet certain
performance standards. Finally, the Company's contracts typically contain
onerous penalties if the Company fails to meet certain performance standards.
The failure to obtain new contracts or the cancellation or delay of existing
contracts or the failure to satisfy the minimum performance standards set forth
in contracts could have a material adverse effect on the Company's business and
results of operations.
 
  Fair Value of Financial Instruments
 
     The book values of cash and cash equivalents, contract payments receivable,
accounts payable and other financial instruments approximate their fair values
principally because of the short-term maturities of these instruments. The fair
value of the Company's note payable is estimated based on the current rates
offered to the Company for debt of similar terms and maturities. Under this
method, the fair value of the Company's note payable was not significantly
different than the book value of December 31, 1997.
 
  Unbilled Costs and Accrued Profits and Unearned Contract Revenue
 
     In general, contractual provisions including predetermined payment
schedules, the achievement of contract milestones or submission of appropriate
billing detail establish prerequisites for billings. Unbilled costs and accrued
profits arise when services have been rendered but clients have not been billed.
These amounts are classified as a current asset. Normally, the clients agree to
pay the Company a portion of the fee due under a
 
                                      F-7

<PAGE>
                          PROFESSIONAL DETAILING, INC.

                   NOTES TO FINANCIAL STATEMENTS--(CONTINUED)
 
1. NATURE OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES--(CONTINUED)
contract in advance of performance of services because of large recruiting and
employee development costs associated with the beginning of a contract. The
excess of amounts billed over revenue recognized represents unearned contract
revenue, which is classified as a current liability.
 
  Cash and Cash Equivalents
 
     Cash and cash equivalents consist of unrestricted cash accounts and
Certificates of Deposit with a maturity of three months or less at the date of
purchase.
 
  Property, Plant and Equipment
 
     Property, plant and equipment are stated at cost. The estimated useful
lives of asset classifications are seven years for furniture and fixtures and
five years for office equipment and computer equipment. Depreciation is computed
using the straight-line method, and the cost of leasehold improvements is
amortized over the shorter of the estimated service lives or the terms of the
related leases. Repairs and maintenance are charged to expense as incurred. Upon
disposition, the asset and related accumulated depreciation are relieved and any
gains or losses are reflected in operations.
 
  Stock Based Compensation
 
     Statement of Financial Accounting Standard No. 123, 'Accounting for
Stock-Based Compensation' allows companies a choice of measuring employee
stock-based compensation expense based on the fair value method of accounting or
based upon the intrinsic value approach under APB Opinion No. 25. The Company
has elected to measure compensation expense based upon the intrinsic value
approach under APB Opinion No. 25.
 
  Advertising
 
     The Company recognizes advertising costs as incurred. The total amounts
charged to advertising expense were $242,408, $87,104 and $159,206 for the years
ended December 31, 1995, 1996 and 1997, respectively.
 
  Income Taxes
 
     The Company elected to be taxed under Subchapter S of the Internal Revenue
Code of 1986, as amended effective January 1, 1991 and under the corresponding
provisions of the laws of the State of New Jersey effective January 1, 1994.
Consequently, the Company has not been subject to Federal or New Jersey state
income taxes, other than a New Jersey corporate income tax of approximately 2%.
 
2. ANTICIPATED MERGER (UNAUDITED)
 
     In connection with a contemplated initial public offering, Professional
Detailing, Inc., a New Jersey corporation (the 'New Jersey Entity') will merge
with and into Professional Detailing, Inc., a Delaware corporation (the
'Delaware Entity'). As a result of the merger, each outstanding share of the New
Jersey Entity's Common Stock will convert into   shares of the Delaware Entity's
Common Stock. In addition, each outstanding option to purchase Common Stock of
the New Jersey Entity will convert into an option to purchase Common Stock of
the Delaware Entity at a      for      ratio.
 
3. PRO FORMA NET INCOME (LOSS) PER SHARE (UNAUDITED)
 
     Pro forma net income (loss) per share was calculated using the pro forma
weighted average number of shares of common stock and dilutive common stock
equivalent shares ('CSEs') from stock options using the treasury stock method
assuming a price of $__ per share. Pursuant to the Securities and Exchange
Commission SAB Topic 4-D, common stock and CSEs issued at prices below the
expected public offering price during the
 
                                      F-8

<PAGE>
                          PROFESSIONAL DETAILING, INC.

                   NOTES TO FINANCIAL STATEMENTS--(CONTINUED)
 
3. PRO FORMA NET INCOME (LOSS) PER SHARE (UNAUDITED)--(CONTINUED)
period prior to the Company's planned offering have been included in the
computation of pro forma weighted average number of shares regardless of whether
they are dilutive and as if they were outstanding from the beginning of the
period.
 
     The following unaudited table shows the calculation of pro forma weighted
average shares outstanding as of December 31, 1997:
 
<TABLE>
<CAPTION>
                                                                                             # OF SHARES
                                                                                             -----------
<S>                                                                                          <C>
Common Stock..............................................................................
Stock Options.............................................................................
                                                                                             -----------
Pro Forma Weighted Average Shares Outstanding.............................................
                                                                                             -----------
                                                                                             -----------
</TABLE>
 
     Under the requirements of Statement of Financial Accounting Standards
('SFAS') No. 128, 'Earnings Per Share', basic net income (loss) per share is
computed using the weighted average number of shares of common stock outstanding
during the period and diluted net income (loss) per share is computed in a
manner similar to which pro forma weighted average shares outstanding as of
December 31, 1997 is calculated above with the exception that common stock
equivalents would be included from the date of issuance and, in any event, only
if they were dilutive.
 
     Had the Company calculated basic and diluted earnings per share pursuant to
the requirements of SFAS No. 128, basic and diluted earnings per share would
have been the following for the period ended December 31, 1997:
 
<TABLE>
<CAPTION>
                                                                                        DECEMBER 31, 1997
                                                                                        -----------------
<S>                                                                                     <C>
Basic earnings per share.............................................................
Diluted earnings per share...........................................................
</TABLE>
 
4. PROPERTY, PLANT AND EQUIPMENT
 
     Property, Plant and Equipment consists of the following:
 
<TABLE>
<CAPTION>
                                                                                      DECEMBER 31,
                                                                                 ----------------------
                                                                                   1996         1997
                                                                                 --------    ----------
<S>                                                                              <C>         <C>
Furniture and fixtures........................................................   $ 38,175    $   81,759
Office equipment..............................................................    176,366       217,796
Computer equipment............................................................    600,200       805,353
Leasehold improvements........................................................     18,693        18,693
                                                                                 --------    ----------
Total Property, Plant and Equipment...........................................    833,434     1,123,601
 
Less accumulated depreciation and amortization................................    438,372       576,224
                                                                                 --------    ----------
Property, Plant and Equipment, net............................................   $395,062    $  547,377
                                                                                 --------    ----------
                                                                                 --------    ----------
</TABLE>
 
5. OPERATING LEASES
 
     The Company leases facilities and certain equipment under agreements
classified as operating leases. Lease expense under these agreements for the
twelve months ended December 31, 1995, 1996 and 1997 were $139,070, $165,020 and
$182,353, respectively. The Company's facilities lease expires on April 29,
1998. The Company has entered into a new lease to take effect May 1, 1998 for a
term of 66 months with an option to extend for an additional five years.
 
                                      F-9

<PAGE>
                          PROFESSIONAL DETAILING, INC.

                   NOTES TO FINANCIAL STATEMENTS--(CONTINUED)
 
5. OPERATING LEASES--(CONTINUED)
     The following is a schedule by year of the future minimum lease payments as
of December 31, 1997 required under these agreements:
 
<TABLE>
<S>                                                                                         <C>
1998......................................................................................  $    368,506
1999......................................................................................       581,954
2000......................................................................................       558,075
2001......................................................................................       550,688
2002......................................................................................       550,687
Thereafter................................................................................       525,656
                                                                                            ------------
Total.....................................................................................  $  3,135,566
                                                                                            ------------
                                                                                            ------------
</TABLE>
 
6. SIGNIFICANT CUSTOMERS
 
     During 1995, 1996 and 1997, the Company had several significant customers
for which it provided services under specific contractual arrangements. The
following sets forth the revenue generated by customers who accounted for more
than 10% of the Company's revenue during each of the periods presented.
 
<TABLE>
<CAPTION>
                      YEARS ENDED DECEMBER 31,
              -----------------------------------------
CUSTOMERS        1995           1996           1997
----------    ----------     ----------     -----------
<S>           <C>            <C>            <C>
    A         $7,736,949     $9,878,375     $13,501,927
    B             *              *           12,253,147
    C          3,073,356      5,456,868      10,543,052
    D          1,861,630      5,389,530          *
    E             *           6,925,230          *
    F          2,758,620         *               *
</TABLE>
 
------------------
* Less than 10% of revenue.
 
     At December 31, 1996 and 1997, these customers represented 98.3% and 79.5%,
respectively, of outstanding receivables and unbilled services. The loss of any
one of the foregoing customers could have a material adverse effect on the
Company's financial position, results of operations or cash flows.
 
7. BORROWINGS
 
     On January 7, 1997, the Company entered into a $100,000 note payable
agreement with a commercial bank with an interest rate of 8.25% maturing on
January 7, 2000. The note is collateralized by all present and future assets of
the Company and a personal guarantee by the majority shareholder. Payments of
$3,145, including principal and interest, are payable monthly. In addition the
Company has a $500,000 line of credit from the bank under which interest would
be payable monthly on the outstanding balance at a floating rate equal to 1%
above the prime rate. The Company has also obtained a commitment from the bank
for a $1 million line of credit, the proceeds of which are to be used
exclusively for capital expenditures. This line would be for a term of nine
months and would bear interest payable monthly at a floating rate equal to 0.75%
above the prime rate. At the end of the nine months, any outstanding balance
would be payable in 60 equal monthly installments of principal and interest
computed at a rate of 0.75% above the prime rate on the date of conversion.
 
     As of December 31, 1997, the Company has not drawn on either line. Both
lines are secured collateralized by a lien on all of the assets of the Company
and the personal guaranty of the Company's majority shareholder. In addition, if
the Company were to draw on such lines, it could be subject to certain
restrictive financial covenants and other customary provisions found in
commercial loan documentation. Committment fees associated with the lines are
immaterial.
 
                                      F-10

<PAGE>
                          PROFESSIONAL DETAILING, INC.

                   NOTES TO FINANCIAL STATEMENTS--(CONTINUED)
 
8. RELATED PARTY TRANSACTIONS
 
     In 1996 and 1997, the Company purchased certain print advertising for
initial recruitment of representatives through a company that was wholly owned
by the Company's majority shareholder. Additionally, the Company also provided
administrative services to this affiliate. The net amounts charged to the
Company for these purchases amounted to $671,810 and $1,564,606 for the years
ended December 31, 1996 and 1997. As of December 31, 1996 and 1997, the amounts
payable to affiliate totaled $284,877 and $146,018, respectively. The Company
also made advances to this affiliate in 1996. As of December 31, 1996 and 1997,
the amounts due the Company as a result of these advances were $369,204 and
$173,179, respectively.
 
9. LOAN TO SHAREHOLDER
 
     As of December 31, 1996 and 1995, the Company had loans of $10,340 to its
then sole shareholder. Such loans were repaid in 1997.
 
10. RETIREMENT PLANS
 
     In 1995, 1996 and 1997, the Company provided its employees with a qualified
profit sharing plan with 401(k) features. The Company made contributions of
$58,667, $99,917 and $172,310 to this plan for the years ended December 31,
1995, 1996 and 1997, respectively.
 
     Effective January 1, 1997, the Company has committed to make mandatory
contributions to the 401(k) plan. This commitment requires contributions from
the Company each year equal to 100% of the amount contributed by each employee
up to 2% of the employee's wages. Any additional contribution to the plan is at
the discretion of the Company.
 
11. COMMITTMENTS AND CONTINGENCIES
 
     The Company is engaged in the business of detailing pharmaceutical
products. Such activities could expose the Company to risk of liability for
personal injury or death to persons using such products, although the Company
does not commercially market or sell the products to end users. While the
Company has not been subject to any claims or incurred any liabilities due to
such claims, there can be no assurance that substantial claims or liabilities
will not arise in the future. The Company seeks to reduce its potential
liability through measures such as contractual indemnification provisions with
clients (the scope of which may vary from client to client, and the performances
of which are not secured) and reliance on insurance maintained by clients. The
Company could, however, also be held liable for errors and omissions of its
employees in connection with the services it performs that are outside the scope
of any indemnity. The Company could be materially and adversely affected if it
were required to pay damages or incur defense costs in connection with a claim
that is outside the scope of the indemnification agreements; if the indemnity,
although applicable, is not performed in accordance with its terms; or if the
Company's liability exceeds the amount of applicable insurance or indemnity. The
Company currently does not carry product liability insurance and is not insured
against the errors and omissions of its employees.
 
     From time to time the Company is involved in litigation incidental to its
business. The Company is not currently a party to any pending litigation which,
if decided adversely to the Company, would have a material adverse effect on the
business, financial condition or results of operations of the Company and the
Company is not aware of any material threatened litigation.
 
12. STOCK GRANT
 
     In January of 1997, the Company issued 15 shares of its Common Stock to its
President and Chief Operating Officer. As a result, he owned 15.0% of the
Company's outstanding shares of common stock at that time (taking into account
the issuance of such shares).
 
                                      F-11

<PAGE>
                          PROFESSIONAL DETAILING, INC.

                   NOTES TO FINANCIAL STATEMENTS--(CONTINUED)
 
12. STOCK GRANT--(CONTINUED)
     This grant of stock was in consideration of services performed on behalf of
the Company. The value of the shares was determined by an independent appraiser
to be $4,050,000 utilizing standard valuation techniques used to value
businesses including discounted cash flow and comparable transactions. The
Company has recognized $4,470,000 in compensation and related expenses in the
first quarter of 1997.
 
13. STOCK OPTION PLAN
 
     Effective in January of 1997, the Company adopted its 1997 Stock Option
Plan (the 'Plan'). A total of 1 share of common stock has been reserved for
issuance under the Plan. Pursuant to the Plan, the Company may grant incentive
stock options and nonqualified options to eligible officers, directors and key
employees and consultants of the Company. The selection of participants,
allotment of shares, determination of price and other conditions relating to the
granting of options is currently determined by the Company's shareholders. As of
December 31, 1997 there were .1 shares remaining in the Plan which were
available for future grant.
 
     Options granted under the Plan, once vested, are exercisable for a period
of up to 10 years from the date of grant at an exercise price which is not less
than 100% of the fair market value of the Common Stock on the date of grant,
unless otherwise determined by the Company's shareholders.
 
     During 1997, there were two grants of stock options to officers of the
Company, one in January for .525 shares at an exercise price of $63,000 and one
in March for .375 shares at an exercise price of $45,000. Both grants expire on
December 31, 2005. In connection with the grant of such options, the Company
will amortize $143,852 of compensation expense over the expected vesting period.
The options are expected to vest as follows: one-third shall be exercisable on
the earlier of June 30, 1998 or the date of the initial public offering (the
'Initial Exercise Date'), another third shall become exercisable on the first
anniversary of the Initial Exercise Date and the final third become exercisable
on the second anniversary of the Initial Exercise Date. As of December 31, 1997,
none of the options were exercisable as the public offering had not yet taken
place and $42,030 of compensation expense has been recognized. The
weighted-average remaining contractual life of the outstanding options was 6.9
years. There were no options granted for any period prior to December 31, 1996.
 
     Had compensation cost for the Company's stock option grants been determined
for awards consistent with the fair value approach of Statement of Financial
Accounting Standard No. 123, 'Accounting for Stock Based Compensation,' which
requires recognition of compensation cost ratably over the vesting period of the
underlying instruments, the Company's net loss would have been increased to the
pro forma amounts indicated below:
 
<TABLE>
<CAPTION>
                                                                                               1997
                                                                                           ------------
<S>                                                                                        <C>
Net loss--As reported...................................................................     (2,948,823)
Net loss--Pro forma.....................................................................     (2,957,075)
Basic Earnings Per Share--as reported...................................................
Basic Earnings Per Share--Pro forma.....................................................
Diluted Earnings per share--as reported.................................................
Diluted Earnings per share--Pro forma...................................................
</TABLE>
 
     Compensation cost for the determination of Net income--Pro forma and
related per share amounts were estimated using a minimum value approach with an
option pricing model and the following assumptions (i) risk free interest rate
6.27%, (ii) expected life 5 years, (iii) expected dividends--0. The fair value
of options granted during 1997 was $172,169.
 
                                      F-12

<PAGE>
                          PROFESSIONAL DETAILING, INC.

                   NOTES TO FINANCIAL STATEMENTS--(CONTINUED)
 
14. PRO FORMA INFORMATION (UNAUDITED)
 
  Pro Forma Provision For (Benefit From) Income Tax
 
     The accompanying financial statements reflect a provision/benefit for
income taxes on a pro forma basis as if the Company were subject to Federal and
New Jersey state income taxes as a taxable corporate entity throughout the years
presented. The pro forma income tax provision is based upon the statutory rates
in effect for C Corporations during the periods presented.
 
     Certain events, including the public offering of the Company's common
stock, will automatically terminate the Company's S Corporation status, thereby
subjecting future income to Federal and New Jersey state income taxes. Due to
temporary differences in the recognition of revenue and expenses, income for
financial reporting purposes has exceeded income for income tax purposes.
Accordingly, the application of the provisions of SFAS No. 109, 'Accounting for
Income Taxes' will result in the recognition of a net deferred tax liability
(and a corresponding one-time charge to expense) in the period in which the
initial public offering occurs. If the S Corporation status had been terminated
as of December 31, 1997, this amount would have been immaterial.
 
  Pro Forma Balance Sheet
 
     The December 31, 1997 pro forma balance sheet as set forth herein reflects
the estimated distribution as of December 31, 1997 of $675,721 to the Company's
shareholders immediately prior to the public offering. Such distribution is
assumed to be funded by the Company's cash on hand as if distribution was made
on December 31, 1997.
 
15. NEW ACCOUNTING PRONOUNCEMENTS
 
     Statement of Financial Accounting Standards No. 130, Reporting
Comprehensive Income, was issued in June 1997 and is effective for fiscal years
beginning after December 15, 1997. This pronouncement establishes standards for
reporting and display of comprehensive income and its components in a full set
of general-purpose financial statements. The Company will adopt this
pronouncement in 1998 and does not expect its implementation will have a
material effect on the Company's financial statements as currently presented.
 
     Statement of Financial Accounting Standards No. 131, Disclosures About
Segments of an Enterprise and Related Information, was also issued in June 1997
and is effective for fiscal periods beginning after December 15, 1997. This
pronouncement establishes the way in which publicly held business enterprises
report information about operating segments in annual financial statements and
interim reports to stockholders. As the Company operates in a single business
segment the implementation of this standard is not expected to significantly
impact the Company's financial statements as currently presented.
 
                                      F-13

<PAGE>

                                     [LOGO]
 
                          PROFESSIONAL DETAILING, INC.


<PAGE>
                                    PART II
 
                     INFORMATION NOT REQUIRED IN PROSPECTUS
 
ITEM 13.  OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
 
     Expenses in connection with the issuance and distribution of the Securities
being registered hereunder, other than underwriting discounts and commissions,
are estimated below.
 
<TABLE>
<S>                                                                                             <C>
SEC registration fee.........................................................................   $13,570
NASD filing fee..............................................................................      *
Nasdaq National Market listing fee...........................................................      *
Printing and engraving costs.................................................................      *
Accounting fees and expenses.................................................................      *
Legal fees and expenses......................................................................      *
State securities law fees and expenses including fees of counsel.............................      *
Transfer Agent and Registrar fees and expenses...............................................     3,500
Miscellaneous................................................................................      *
     Total...................................................................................   $  *
                                                                                                -------
                                                                                                -------
</TABLE>
 
------------------
 
* To be provided by amendment.
 
ITEM 14.  INDEMNIFICATION OF DIRECTORS AND OFFICERS
 
     The Underwriting Agreement provides for reciprocal indemnification between
the Company and its controlling persons, on the one hand, and the Underwriters
and their respective controlling persons, on the other hand, against certain
liabilities in connection with this Offering, including liabilities under the
Securities Act of 1933, as amended (the 'Securities Act').
 
     The Registrant's Certificate of Incorporation and By-Laws provide that the
Registrant shall indemnify its directors to the full extent permitted by the
General corporation Law of the State of Delaware (the 'DGCL') and may indemnify
its officers and employees to such extent, except that the Registrant shall not
be obligated to indemnify any such person with respect to proceedings, claims or
actions initiated or brought voluntarily by any such person and not by way of
defense, or for any amounts paid in settlement of an action indemnified against
by the Registrant without the prior written consent of the Registrant. The
Registrant intends to enter into indemnity agreements with each of its
directors. These agreements may require the Registrant, among other things, to
indemnify such directors against certain liabilities that may arise by reason of
their status or service as directors, and to advance expenses to them as they
are incurred, provided that they undertake to repay the amount advanced if it is
ultimately determined by a court that they are not entitled to indemnification,
and to obtain directors' liability insurance if available on reasonable terms.
 
     In addition, the Registrant's Certificate of Incorporation provides that a
director of the Registrant shall not be personally liable to the Registrant or
its stockholders for monetary damages for breach of his or her fiduciary duty as
director, except for liability (i) for any breach of the directors' duty or
loyalty to the Registrant or its stockholders, (ii) for acts or omissions not in
good faith or which are intentional misconduct or a knowing violation of law,
(iii) for willful or negligent conduct in paying dividends or repurchasing stock
out of any other lawfully available funds or (iv) for any transaction from which
the director derives an improper personal benefit.
 
ITEM 15.  RECENT SALES OF UNREGISTERED SECURITIES
 
     During the past three years the Company issued the following unregistered
securities:
 
          On January 1, 1997 the Company issued shares of its Common Stock
     representing 15% of the total number of shares then outstanding to its then
     President and Chief Operating Officer, Charles T. Saldarini. The
     transaction described above did not involve a public offering of the
     Registrant's securities and was exempt from the registration requirements
     of the Securities Act pursuant to Section 4(2) thereof and by reason of
     Regulation D under the Securities Act.
 
                                      II-1

<PAGE>
ITEM 16.  EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
 
     (a) Exhibits:
 
<TABLE>
<CAPTION>
 EXHIBIT
   NO.                                                 DESCRIPTION
---------  ----------------------------------------------------------------------------------------------------
 
<S>        <C>
 1.1       Form of Underwriting Agreement
 
 2.1       Merger Agreement between Professional Detailing, Inc., a New Jersey corporation, and Professional
           Detailing Inc., a Delaware corporation*
 
 3.1       Certificate of Incorporation of Professional Detailing, Inc.
 
 3.2       By-Laws of Professional Detailing, Inc.
 
 4.1       Specimen Certificate Representing the Common Stock*
 
 5.1       Form of Opinion of Morse, Zelnick, Rose & Lander, LLP*
 
10.1       1998 Stock Option Plan*
 
10.2       Office Lease between IB Brell, L.P. (Landlord) and Professional Detailing, Inc. (Tenant) and
           amendment thereto
 
10.3       Employment Agreement between the Company and Charles T. Saldarini*
 
10.4       Employment Agreement between the Company and John P. Dugan*
 
10.5       Employment Agreement between the Company and Steven K. Budd*
 
10.6.      Employment Agreement between the Company and Bernard C. Boyle*
 
23.1       Consent of Coopers & Lybrand L.L.P.
 
23.2       Consent of Morse, Zelnick, Rose & Lander, LLP (included in Exhibit 5.1)*
 
23.3       Consent of Farkas & Manelli, P.L.L.C.
 
24         Power of Attorney (included in signature page)
 
27         Financial Data Schedule
 
99.1       Consent of Director Nominee (John M. Pietruski)
 
99.2       Consent of Director Nominee (Jan Martens Vecsi)
 
99.3       Consent of Director Nominee (Gerald J. Mossinghoff)
</TABLE>
 
------------------
* To be filed by amendment
 
                                      II-2

<PAGE>
ITEM 17.  CERTAIN UNDERTAKINGS
 
     A. The undersigned Registrant hereby undertakes to provide to the
Underwriters at the closing specified in the Underwriting Agreement,
certificates in such denominations and registered in such names as required by
the Underwriters to permit prompt delivery to each purchaser.
 
     B. The undersigned Registrant hereby undertakes that:
 
          (1) For purposes of determining any liability under the Securities Act
     of 1933, the information omitted from the form of prospectus filed as part
     of this registration statement in reliance upon Rule 430A and contained in
     a form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or
     (4) or 497(h) under the Securities Act shall be deemed to be part of this
     registration statement as of the time it was declared effective.
 
          (2) For the purpose of determining any liability under the Securities
     Act of 1933, each post-effective amendment that contains a form of
     prospectus shall be deemed to be a new registration statement relating to
     the securities offered therein, and the Offering of such securities at that
     time shall be deemed to be the initial bona fide offering thereof.
 
     C. Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Securities Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a director, officer or controlling person of the Registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
 
                                      II-3

<PAGE>
                                   SIGNATURES
 
     Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized in the City of Mahwah,
State of New Jersey, on the 13th day of February, 1998.
 
                                          PROFESSIONAL DETAILING, INC.
 
                                          By: /s/ Charles T. Saldarini
                                            ------------------------------------
                                              Charles T. Saldarini,
                                              President and Chief Executive
                                              Officer
 
     KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Charles T. Saldarini, and Kenneth S. Rose, or any
one of them, his true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for him and in his name, place and stead, in
any and all capacities, to sign any and all pre- or post- effective amendments
to this Registration Statement, and to file the same with all exhibits thereto,
and other documents in connection therewith, with the Securities and Exchange
Commission, granting unto said attorneys-in-fact and agents, and each of them,
full power and authority to do and perform each and every act and thing
requisite or necessary to be done in and about the premises, as fully to all
intents and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or any one of them, or
their or his substitutes, may lawfully do or cause to be done by virtue hereof.
 
     Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed by the following persons in the
capacities indicated and on the 13th day of February, 1998.
 
<TABLE>
<CAPTION>
           SIGNATURE                                      TITLE
--------------------------------    --------------------------------------------------
 
<S>                                 <C>                                              
/s/ JOHN P. DUGAN                   Chairman of the Board of Directors
-------------------------------
John P. Dugan
 
/s/ CHARLES T. SALDARINI            President, Chief Executive Officer and Director
-------------------------------
Charles T. Saldarini
 
/s/ BERNARD C. BOYLE                Chief Financial Officer (Principal Accounting
-------------------------------     Officer)
Bernard C. Boyle
</TABLE>
 
                                      II-4

<PAGE>

                                EXHIBIT INDEX

<TABLE>
<CAPTION>
 EXHIBIT
   NO.                                                 DESCRIPTION
---------  ----------------------------------------------------------------------------------------------------
 
<S>        <C>
 1.1       Form of Underwriting Agreement
 
 2.1       Merger Agreement between Professional Detailing, Inc., a New Jersey corporation, and Professional
           Detailing Inc., a Delaware corporation*
 
 3.1       Certificate of Incorporation of Professional Detailing, Inc.
 
 3.2       By-Laws of Professional Detailing, Inc.
 
 4.1       Specimen Certificate Representing the Common Stock*
 
 5.1       Form of Opinion of Morse, Zelnick, Rose & Lander, LLP*
 
10.1       1998 Stock Option Plan*
 
10.2       Office Lease between IB Brell, L.P. (Landlord) and Professional Detailing, Inc. (Tenant) and
           amendment thereto
 
10.3       Employment Agreement between the Company and Charles T. Saldarini*
 
10.4       Employment Agreement between the Company and John P. Dugan*
 
10.5       Employment Agreement between the Company and Steven K. Budd*
 
10.6.      Employment Agreement between the Company and Bernard C. Boyle*
 
23.1       Consent of Coopers & Lybrand L.L.P.
 
23.2       Consent of Morse, Zelnick, Rose & Lander, LLP (included in Exhibit 5.1)*
 
23.3       Consent of Farkas & Manelli, P.L.L.C.
 
24         Power of Attorney (included in signature page)
 
27         Financial Data Schedule
 
99.1       Consent of Director Nominee (John M. Pietruski)
 
99.2       Consent of Director Nominee (Jan Martens Vecsi)
 
99.3       Consent of Director Nominee (Gerald J. Mossinghoff)
</TABLE>
 
------------------
* To be filed by amendment
[{"type": "S-1", "sequence": "1", "description": "REGISTRATION STATEMENT", "secsgml_size_bytes": 298249}]
{"company-data": {"conformed-name": "PROFESSIONAL DETAILING INC", "cik": "0001054102", "assigned-sic": ""}, "filing-values": {"form-type": "S-1", "act": "33", "file-number": "333-46321", "film-number": "98539663"}, "business-address": {"street1": "599 MACARTHUR BLVD", "city": "MAHWAH", "state": "NJ", "zip": "07430-2326", "phone": "2018188450"}, "mail-address": {"street1": "599 MACARTHUR BLVD", "city": "MAHWAH", "state": "NJ", "zip": "07430-2326"}}
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON FEBRUARY __, 1998
                                                      REGISTRATION NO. 333-_____
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
 
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                          ---------------------------
 
                                    FORM S-1
                             REGISTRATION STATEMENT
                                     UNDER
                           THE SECURITIES ACT OF 1933
                          ---------------------------
 
                          PROFESSIONAL DETAILING, INC.
             (Exact name of Registrant as specified in its charter)
DELAWARE                                     7389                                    22-3562897
     (State or Other Jurisdiction of             (Primary Standard Industrial                     (I.R.S. Employer
     Incorporation or Organization)               Classification Code Number)                    Identification No.)
                                                    599 MacArthur Boulevard
                                                 Mahwah, New Jersey 07430-2326
                                                        (201) 818-8450
                                                   (201) 818-8445 Facsimile
(Address, including zip code, and telephone number, including area code, of
                        Registrant's executive offices)
 
                              CHARLES T. SALDARINI
                     PRESIDENT AND CHIEF EXECUTIVE OFFICER
                          PROFESSIONAL DETAILING, INC.
                            599 MACARTHUR BOULEVARD
                         MAHWAH, NEW JERSEY 07430-2326
                                 (201) 818-8450
                            (201) 818-8445 FACSIMILE
 (Name, address, including zip code, and telephone number, including area code,
                             of agent for service)
 
                          ---------------------------
 
                                   Copies to:
KENNETH S. ROSE, ESQ.                                           KEITH F. HIGGINS, ESQ.
                   JOEL J. GOLDSCHMIDT, ESQ.                                              ROPES & GRAY
              MORSE, ZELNICK, ROSE & LANDER, LLP                                     ONE INTERNATIONAL PLACE
                        450 PARK AVENUE                                            BOSTON, MASSACHUSETTS 02110
                   NEW YORK, NEW YORK 10022                                              (617) 951-7000
                        (212) 838-5030                                              (617) 951-7050 FACSIMILE
                   (212) 838-9190 FACSIMILE
---------------------------
 
    APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: AS SOON AS
PRACTICABLE AFTER THIS REGISTRATION STATEMENT BECOMES EFFECTIVE.
 
    If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, as amended (the 'Securities Act'), check the following box. / /
 
    If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, check the following box and
list the Securities Act registration statement number of the earlier effective
registration statement for the same offering. / /
 
    If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / /
 
    If this Form is a post-effective amendment filed pursuant to Rule 462(d)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / /
 
    If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. / /
 
                          ---------------------------
 
                        CALCULATION OF REGISTRATION FEE
TITLE OF EACH CLASS OF                             PROPOSED MAXIMUM                     AMOUNT OF
                 SECURITIES TO BE REGISTERED                     AGGREGATE OFFERING PRICE (1)           REGISTRATION FEE
Common Stock, $.01 par value..................................            $46,000,000                      $13,570.00
(1) Estimated solely for purposes of calculating the amount of the registration
    fee paid pursuant to Rule 457(o) under the Securities Act.
 
    THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE SECURITIES AND EXCHANGE COMMISSION, ACTING
PURSUANT TO SAID SECTION 8(A), MAY DETERMINE.
 
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT.  A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION  OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.

PROSPECTUS (SUBJECT TO COMPLETION)
ISSUED _____________ ___, 1998

                         ________________________SHARES
                          PROFESSIONAL DETAILING, INC.
                                  COMMON STOCK
 
                            ------------------------
 
ALL OF THE SHARES OF COMMON STOCK BEING OFFERED HEREBY ARE BEING SOLD BY THE
COMPANY. PRIOR TO THE OFFERING, THERE HAS BEEN NO PUBLIC MARKET FOR THE
   COMMON STOCK OF THE COMPANY. IT IS CURRENTLY ESTIMATED THAT THE INITIAL
   PUBLIC OFFERING PRICE PER SHARE WILL BE BETWEEN $______ AND $______. SEE
     'UNDERWRITERS' FOR A DISCUSSION OF THE FACTORS TO BE CONSIDERED IN
                 DETERMINING THE INITIAL PUBLIC OFFERING PRICE.
 
                            ------------------------
 
      APPLICATION HAS BEEN MADE TO LIST THE COMMON STOCK FOR QUOTATION ON
              THE NASDAQ NATIONAL MARKET UNDER THE SYMBOL 'PDII.'
 
                            ------------------------
 
        THIS OFFERING INVOLVES A HIGH DEGREE OF RISK. SEE 'RISK FACTORS'
                    BEGINNING ON PAGE 7 OF THIS PROSPECTUS.
 
                            ------------------------
 
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
      EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
    SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
         PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
            REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
 
                            ------------------------
 
                             PRICE $       A SHARE
 
                            ------------------------
UNDERWRITING
                                                PRICE TO               DISCOUNTS AND             PROCEEDS TO
                                                 PUBLIC               COMMISSIONS (1)            COMPANY (2)
                                            ----------------          ---------------          ----------------
Per Share..............................            $                         $                        $
Total (3)..............................            $                         $                        $
------------------
(1) The Company has agreed to indemnify the Underwriters against certain
    liabilities, including liabilities under the Securities Act of 1933, as
    amended.
 
(2) Before deducting expenses payable by the Company estimated at $______.
 
(3) The Company has granted to the Underwriters an option, exercisable within 30
    days of the date hereof, to purchase up to an aggregate of ______ additional
    Shares at the price to public less underwriting discounts and commissions
    for the purpose of covering over-allotments, if any. If the Underwriters
    exercise such Shares in full, the total price to public, underwriting
    discounts and commissions and proceeds to Company will be $______, $______
    and $______, respectively. See 'Underwriters.'
                            ------------------------
 
     The Shares are offered, subject to prior sale, when, as and if accepted by
the Underwriters named herein and subject to approval of certain legal matters
by Ropes & Gray, counsel for the Underwriters. It is expected that delivery of
the Shares will be made on or about           , 1998 at the office of Morgan
Stanley & Co. Incorporated, New York, N.Y., against payment therefor in
immediately available funds.
                            ------------------------
 
MORGAN STANLEY DEAN WITTER
                            WILLIAM BLAIR & COMPANY
                                                               HAMBRECHT & QUIST
 
            , 1998
NO PERSON IS AUTHORIZED IN CONNECTION WITH ANY OFFERING MADE HEREBY TO GIVE
ANY INFORMATION OR TO MAKE ANY REPRESENTATION NOT CONTAINED IN THIS PROSPECTUS,
AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION MUST NOT BE RELIED
UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY OR BY ANY UNDERWRITER. THIS
PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO
BUY ANY SECURITY OTHER THAN THE SHARES OF COMMON STOCK OFFERED HEREBY, NOR DOES
IT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY OF THE
SECURITIES OFFERED HEREBY TO ANY PERSON IN ANY JURISDICTION IN WHICH IT IS
UNLAWFUL TO MAKE SUCH AN OFFER OR SOLICITATION TO SUCH PERSON. NEITHER THE
DELIVERY OF THIS PROSPECTUS NOR ANY OFFER OR SALE MADE HEREBY SHALL UNDER ANY
CIRCUMSTANCE IMPLY THAT THE INFORMATION CONTAINED HEREIN IS CORRECT AS OF ANY
DATE SUBSEQUENT TO THE DATE HEREOF.
                            ------------------------
 
     UNTIL         , 1998 (25 DAYS AFTER THE COMMENCEMENT OF THE OFFERING) ALL
DEALERS EFFECTING TRANSACTIONS IN THE COMMON STOCK, WHETHER OR NOT PARTICIPATING
IN THIS DISTRIBUTION, MAY BE REQUIRED TO DELIVER A PROSPECTUS. THIS IS IN
ADDITION TO THE OBLIGATION OF DEALERS TO DELIVER A PROSPECTUS WHEN ACTING AS
UNDERWRITERS AND WITH RESPECT TO THEIR UNSOLD ALLOTMENTS OR SUBSCRIPTIONS.
                            ------------------------
 
                               TABLE OF CONTENTS
PAGE
                                                                                                              ----
Prospectus Summary........................................................................................      3
Summary Financial Data....................................................................................      5
Risk Factors..............................................................................................      7
Use of Proceeds...........................................................................................     13
Dividend Policy...........................................................................................     13
S Corporation Termination.................................................................................     13
Capitalization............................................................................................     14
Dilution..................................................................................................     15
Selected Financial Data...................................................................................     16
Management's Discussion and Analysis of Financial Condition and Results of Operations.....................     18
Business..................................................................................................     24
Management................................................................................................     37
Certain Transactions......................................................................................     42
Principal Shareholders....................................................................................     43
Description of Capital Stock..............................................................................     44
Shares Eligible for Future Sale...........................................................................     46
Underwriters..............................................................................................     47
Legal Matters.............................................................................................     48
Experts...................................................................................................     49
Additional Information....................................................................................     49
Index to Financial Statements.............................................................................    F-1
------------------------
 
     The Company intends to furnish to its stockholders annual reports
containing audited financial statements and an opinion thereon expressed by
independent accountants and quarterly reports for the first three quarters of
each fiscal year containing interim financial information.
                            ------------------------
 
     CERTAIN PERSONS PARTICIPATING IN THIS OFFERING MAY ENGAGE IN TRANSACTIONS
THAT STABILIZE, MAINTAIN, OR OTHERWISE AFFECT THE PRICE OF THE COMMON STOCK.
SPECIFICALLY, THE UNDERWRITERS MAY OVERALLOT IN CONNECTION WITH THE OFFERING,
AND MAY BID FOR, AND PURCHASE, SHARES OF THE COMMON STOCK IN THE OPEN MARKET.
FOR A DESCRIPTION OF THESE ACTIVITIES, SEE 'UNDERWRITERS.'
                            ------------------------
 
     In this Prospectus, the term the 'Company' or 'PDI' includes Professional
Detailing, Inc., a Delaware corporation, and its predecessors. The Company's
corporate headquarters are located at 599 MacArthur Boulevard, Mahwah, New
Jersey 07430, and its telephone number is (201) 818-8450.
PROSPECTUS SUMMARY
 
     The following summary is qualified in its entirety by the more detailed
information and the Financial Statements and the notes thereto appearing
elsewhere in this Prospectus. Unless otherwise indicated, the information in
this Prospectus has been adjusted to reflect a merger (the 'Merger') of
Professional Detailing, Inc., a New Jersey corporation, with and into
Professional Detailing, Inc., a Delaware corporation, immediately prior to the
effective date of the registration statement of which this Prospectus is a part.
Upon completion of the Merger, the shareholders of the New Jersey corporation
will own an aggregate of _______ shares of the Delaware corporation and all
outstanding options to purchase shares of the New Jersey corporation will be
converted into options to purchase shares of the Delaware corporation. All
references herein to industry financial and statistical information are based on
trade articles, industry reports and other sources that the Company believes to
be reliable, although there can be no assurance to that effect. Unless specified
to the contrary or the context clearly implies otherwise, all references herein
to the 'Company' or 'PDI' shall be deemed to include Professional Detailing,
Inc., a Delaware corporation, and its predecessors. Unless otherwise indicated,
the information in this Prospectus assumes no exercise of the Underwriters'
over-allotment option.
 
                                  THE COMPANY
 
     The Company is a leading provider of comprehensive customized sales
solutions on an outsourced basis to the United States pharmaceutical industry.
The Company believes it has achieved this leadership position based on its 10
years of industry experience and its relationships with many of the
pharmaceutical industry's largest companies. Since inception, the Company has
designed customized product detailing programs for approximately 25 clients,
including Pfizer, Inc., Astra Merck Inc., Glaxo Wellcome Inc. and Johnson &
Johnson, Inc. These programs have been designed to promote more than 70
different products, including such leading prescription medications as
Prilosec(Registered), Wellbutrin(Registered) and Cardura(Registered), as well as
a number of over-the-counter ('OTC') products such as Bayer(Registered) Aspirin,
Pepcid AC(Registered) and Monistat 5(Registered), to hospitals, pharmacies and
physicians in approximately 20 different specialties. The Company's primary
objective is to enhance its leadership position in the growing contract sales
organization ('CSO') industry and to become the premier supplier of
comprehensive sales solutions to the pharmaceutical industry and other segments
of the healthcare market.
 
     The Company has demonstrated strong internal growth, generated by securing
new business from leading pharmaceutical companies and by renewing and expanding
programs with existing clients. The Company believes that it is one of the
largest CSOs operating in the United States measured both by revenue and total
number of sales representatives used in programs. Revenue and gross profit grew
at compound rates of 87.7% and 58.0%, respectively, between 1994 and 1997. The
number of sales representatives (both full-time and part-time) employed by the
Company has increased from approximately 100 as of December 31, 1993 to
approximately 1,000 as of December 31, 1997. Over that same period, the
Company's mix between part-time and full-time representatives shifted from 100%
part-time to 45% part-time. The Company has also experienced a consistently high
renewal rate among its clients. For example, for the year ended December 31,
1997, approximately 86% of the Company's revenue was generated from clients that
had contributed to its 1996 revenue.
 
     According to PMSI Scott-Levin Inc., a healthcare marketing information
company ('Scott-Levin'), United States pharmaceutical companies spent
approximately $4.5 billion on product detailing in 1996. The Company estimates
that product detailing, on average, represents approximately 60% of a
pharmaceutical company's total promotional spending. Product detailing involves
a face-to-face meeting between a sales representative and a targeted prescriber,
usually a physician identified because of his or her specialty or prescribing
patterns. Detailing generally occurs in physician offices and hospitals,
although conventions and trade association meetings may also provide an
appropriate forum. The sales representative is required to possess a high level
of product knowledge, as well as other technical and therapeutic expertise.
Product detailing involves a technical review of the product's legally
authorized indications and usage, role in disease treatment, mechanism of
action, side effects, dosing, drug interactions, cost and availability (i.e.,
the 'details').
 
     The CSO industry provides outsourced physician detailing programs to
pharmaceutical, medical device and diagnostic companies. CSOs have evolved from
providing detailing support for OTC products into a full-service industry
handling some of the leading prescription pharmaceutical compounds. Since the
early 1990s, the United States pharmaceutical industry has increasingly used
CSOs to provide the detailing service required to introduce new products,
reintroduce older products, supplement existing sales efforts, raise promotional
barriers to entry for competitors and demonstrate the incremental sales impact
of detailing a particular product. While there is little available data
regarding the CSO industry, the Company believes that there are approximately
eight CSOs currently operating in the United States. The Company also believes
that 17 of the 50 largest pharmaceutical 
 
                                       3
Common Stock to be Offered..........................................  ____________Shares
Common Stock to be Outstanding after the Offering...................  ____________Shares (1)
Use of Proceeds.....................................................  Working capital for business
                                                                      expansion purposes, investment
                                                                      in infrastructure and other
                                                                      general corporate purposes,
                                                                      including potential
                                                                      acquisitions. See 'Use of
                                                                      Proceeds.'
Proposed Nasdaq National Market Symbol..............................  PDII

 
------------------
(1) Excludes (i) ___________ shares of Common Stock issuable upon the exercise
    of stock options outstanding on December 31, 1997, at a weighted average
    exercise price of $___________ per share and (ii) ___________ additional
    shares of Common Stock reserved for future grants under the Company's 1998
    Stock Option Plan. See 'Management -- 1998 Stock Option Plan.'
 
                                       4
SUMMARY FINANCIAL DATA
 
STATEMENT OF OPERATIONS DATA:
YEAR ENDED DECEMBER 31,
                                                           -----------------------------------------------------
                                                            1993       1994       1995        1996        1997
                                                           ------     ------     -------     -------     -------
                                                           (IN THOUSANDS, EXCEPT PER SHARE AND STATISTICAL DATA)
Revenue................................................    $8,226     $8,250     $18,398     $33,015     $54,542
Program expenses.......................................     4,886      5,339      15,427      26,886      43,057
                                                           ------     ------     -------     -------     -------
Gross profit...........................................     3,340      2,911       2,971       6,129      11,485
Compensation expense...................................     1,945      1,673       2,124       3,191       5,121(1)
Bonus to majority shareholder(2).......................       440        200         425       1,500       2,243
Stock grant expense(3).................................        --         --          --          --       4,470
Other general, selling and administrative expenses.....       844        826       1,159       1,650       2,755
                                                           ------     ------     -------     -------     -------
Total general, selling and administrative expenses.....     3,229      2,699       3,708       6,341      14,589
                                                           ------     ------     -------     -------     -------
Operating income (loss)................................       111        212        (737)       (212)     (3,104)
Other income, net......................................        17         16          70          98         155
                                                           ------     ------     -------     -------     -------
Income (loss) before provision for taxes...............       128        228        (667)       (114)     (2,949)
Pro forma provision for (benefit from) income
  taxes(4).............................................        51         91        (121)         --          --
                                                           ------     ------     -------     -------     -------
Pro forma net income (loss)(4).........................    $   77     $  137     $  (546)    $  (114)    $(2,949)
                                                           ------     ------     -------     -------     -------
                                                           ------     ------     -------     -------     -------
Pro forma net income (loss) per share(4)...............                                                  $
                                                                                                         -------
                                                                                                         -------
Pro forma weighted average number of shares
  outstanding..........................................
                                                                                                         -------
                                                                                                         -------
 
OTHER FINANCIAL DATA:
 
Adjusted operating income (loss)(5)....................    $  551     $  412     $  (312)    $ 1,288     $ 3,609
Adjusted net income (loss)(4)(5).......................       341        257        (145)        832       2,258
 
OTHER OPERATING DATA:
 
Number of detail programs..............................         8          9          10          13          15
Number of clients......................................         6          7           7           8          12
Average size of detail program.........................    $1,028     $  917     $ 1,840     $ 2,540     $ 3,636
Number of sales representatives at end of period:
  Full-time............................................        --         --          --          29         633
  Part-time............................................       107        107         393         709         362
                                                           ------     ------     -------     -------     -------
  Total................................................       107        107         393         738         995
                                                           ------     ------     -------     -------     -------
                                                           ------     ------     -------     -------     -------
See footnotes on following page
 
                                       5
BALANCE SHEET DATA:
                                                                                         AS OF DECEMBER 31, 1997
                                                                                        --------------------------
                                                                                                      PRO FORMA
                                                                                        ACTUAL      AS ADJUSTED(6)
                                                                                        -------     --------------
                                                                                             (IN THOUSANDS)
Cash and cash equivalents...........................................................    $ 5,760        $
Working capital.....................................................................        129
Total assets........................................................................     13,691
Total long-term debt................................................................         --
Shareholders' equity (deficit)......................................................        676
------------------
 
(1) Includes bonus compensation of $237,000 paid to Charles T. Saldarini, the
    Company's President, Chief Executive Officer and a minority shareholder. It
    is expected that, in addition to his base salary, Mr. Saldarini may receive
    cash bonuses in future periods as determined by the Compensation Committee.
    See 'Management -- Executive Compensation.'
 
(2) The Company has been treated as an S Corporation under subchapter S of the
    Internal Revenue Code of 1986, as amended (the 'Code') since January 1, 1991
    and under the corresponding provisions of the tax laws of the State of New
    Jersey since January 1, 1994. Historically, as an S Corporation, the Company
    made annual bonus payments to its majority shareholder based on the
    Company's estimated profitability and working capital requirements. With the
    exception of the distribution to be declared immediatley prior to the
    Offering, the Company does not expect to pay such bonuses in future periods.
    See 'Dividend Policy.'
 
(3) On January 1, 1997, the Company issued shares of its Common Stock to Charles
    T. Saldarini, its current President and Chief Executive Officer. As a
    result, prior to the Offering, Mr. Saldarini owns 15.0% of the Common Stock
    outstanding. For financial accounting purposes, a non-recurring, non-cash
    compensation expense was charged in the first quarter of 1997. See
    'Principal Shareholders,' 'Management,' 'Certain Transactions' and note 12
    to the Company's Financial Statements.
 
(4) As an S Corporation, the Company has not been subject to Federal or New
    Jersey corporate income taxes, other than a New Jersey state corporate
    income tax of approximately 2%. Rather, the income of the Company has been
    taxed at the shareholder level. Upon consummation of this Offering, the
    Company will no longer be treated as an S Corporation, and, accordingly,
    will be subject to Federal and state corporate income taxes. Pro forma
    provision for income taxes, net income, net income per share and adjusted
    net income for all periods presented reflect a provision for income taxes as
    if the Company had been taxed as a C Corporation for all periods.
 
(5) Adjusted to eliminate bonus to majority shareholder and stock grant expense.
    This presentation illustrates the Company's results of operations on an
    adjusted basis to reflect that the Company does not intend to pay bonuses to
    its majority shareholder or incur stock grant expense in future periods.
    These presentations should not be construed as an alternative to operating
    income or net income/(loss) (as determined in accordance with generally
    accepted accounting principles) as presented herein.
 
(6) Adjusted to reflect the receipt of the estimated net proceeds of this
    Offering and the pro forma effect of the estimated final distribution to the
    Company's existing shareholders immediately prior to this Offering of
    approximately $_____ million reflecting shareholders' equity as of the date
    of such distribution. See 'Dividend Policy,' 'S Corporation Termination' and
    'Management's Discussion and Analysis of Financial Condition and Results of
    Operations.'
 
                                       6
RISK FACTORS
 
     An investment in the shares of Common Stock offered hereby involves a high
degree of risk. Prospective investors should consider carefully the following
risk factors, in addition to the other information contained in this Prospectus,
in evaluating an investment in the shares of Common Stock offered hereby.
 
DEPENDENCE ON OUTSOURCING BY PHARMACEUTICAL COMPANIES
 
     The Company's revenue is highly dependent on sales and marketing
expenditures by pharmaceutical companies for the sale and distribution of
pharmaceutical products. The Company has benefited to date from the growing
trend of pharmaceutical companies to outsource sales and marketing programs to
CSOs. There can be no assurance that this trend in outsourcing will continue as
pharmaceutical companies may elect to perform such services internally. In
particular, the trend in the pharmaceutical industry toward consolidation, by
merger or otherwise, may result in a reduction in the use of CSOs. A significant
change in the direction of the outsourcing trend generally, or a trend in the
pharmaceutical industry not to use, or to reduce the use of, outsourced
marketing services, such as those provided by the Company, would have a material
adverse effect on the Company. See 'Business -- The CSO Industry.'
 
CUSTOMER CONCENTRATION
 
     The Company's revenue and profitability are highly dependent on its
relationships with several large pharmaceutical companies. In 1995, the
Company's four largest clients accounted for approximately 42%, 17%, 15% and
10%, respectively, or 84%, of its revenue. In 1996, the Company's four largest
clients accounted for approximately 30%, 21%, 17% and 16%, respectively, or 84%,
of its revenue. In 1997, the Company's four largest clients, Pfizer, Glaxo
Wellcome, Astra Merck and Novartis, accounted for approximately 25%, 22%, 19%
and 10%, respectively, or 76%, of its revenue. The Company is likely to continue
to experience a high degree of concentration of business. Such concentration may
become greater as a result of consolidation within the pharmaceutical industry.
The loss or significant reduction of business from any significant customer,
including as a result of further consolidation in the pharmaceutical industry,
could have a material adverse effect on the Company's business and results of
operations. See 'Business -- Clients and Contracts.'
 
DEPENDENCE ON THE PHARMACEUTICAL INDUSTRY
 
     Substantially all of the Company's revenue to date has been generated from
providing product detailing services to pharmaceutical companies. The Company
could be materially and adversely affected by unfavorable developments in the
pharmaceutical industry generally or any reduction in expenditures for, or
future outsourcing of, promotional, marketing and sales activities by
pharmaceutical companies or a shift in marketing focus away from detailing.
Promotional, marketing and sales expenditures by pharmaceutical companies have
in the past been, and could in the future be, negatively impacted by, among
other things, governmental reform or private market initiatives intended to
reduce the cost of pharmaceutical products or by governmental, medical
association or pharmaceutical industry initiatives designed to regulate the
manner in which pharmaceutical companies promote their products. See
'Business -- The CSO Industry.'
 
LACK OF PROFITABILITY
 
     For the years ended 1995, 1996 and 1997, the Company had net losses of
$667,000, $114,000 and $2,949,000, respectively. At December 31, 1997, the
Company had negative retained earnings of $3,416,000. While the Company's net
losses in 1995 and 1996 were primarily due to expenses incurred in connection
with the expansion of the Company's business and bonus payments to its majority
shareholder and the Company's negative retained earnings and net loss for 1997
were due to a non-cash, non-recurring compensation expense relating to stock
granted to the Company's President and Chief Executive Officer, Charles T.
Saldarini, in the first quarter of 1997, the Company must nonetheless continue
to replace and/or expand existing programs and obtain new clients in order to
achieve sustained profitability. There can be no assurance that the Company will
be able to continue to generate increased revenue or achieve profitable
operations. See 'Management's Discussion and Analysis of Financial Condition and
Results of Operations.'
 
RISKS ASSOCIATED WITH THE NATURE OF CONTRACTS
 
     The Company's contracts are generally for terms of six months to one year
and are subject to renewal upon expiration. In addition, a single contract may
account for a significant portion of the Company's total revenue. The Company's
contracts may be terminated by the client at any time for any reason. Also,
contracts typically contain significant penalties if the Company fails to meet
state performance benchmarks. While the cancellation
 
                                       7
of certain of the Company's contracts by a client without cause may result in
the imposition of penalties on such client, such penalties may not act as an
adequate deterrent to the termination of such contracts. In addition, there can
be no assurance that such penalties will offset the lost revenue or the costs
incurred by the Company as a result of any such termination. Furthermore, all of
the Company's sales representatives are employees rather than independent
contractors. Accordingly, upon the termination of a particular contract, unless
the Company can immediately transfer the sales force to a new program, it either
must continue to compensate those employees, without realizing any related
revenue, or terminate their employment. If the Company terminates their
employment, it may incur significant expenses relating to such termination,
including the cost of recruiting and hiring replacement sales personnel.
Finally, substantially all of the Company's contracts are 'fixed fee'
arrangements. Accordingly, if the Company underestimates the costs associated
with the services to be provided pursuant to a particular contract, or if there
are unanticipated increases in the Company's operating or administrative
expenses, the overall profitability of the Company and the margins on a
particular contract may be adversely affected. The failure to obtain new
contracts to replace expiring contracts, the cancellation or delay of an
existing contract, the failure to satisfy the minimum performance standards set
forth in a contract, the inability of the Company to transfer a sales force to a
new program upon the termination of program, or the underestimation of costs
associated with a particular contract could have a material adverse effect on
the Company's business and results of operations. See 'Business -- Clients and
Contracts.'
 
VARIABILITY OF QUARTERLY OPERATING RESULTS
 
     The Company's results of operations have been subject to quarterly
fluctuations. In the future, quarterly operating results may fluctuate as a
result of a number of factors, including the commencement, delay, cancellation
or completion of programs; the mix of services provided; the timing of start-up
expenses for new services; the accuracy of estimates of resources required for
ongoing programs; the timing and integration of acquisitions; changes in
regulations related to pharmaceutical companies; and general economic
conditions. The Company believes that quarterly comparisons of its financial
results are not necessarily meaningful and should not be relied upon as an
indication of future performance. In addition, fluctuations in quarterly results
could affect the market price of the Common Stock in a manner unrelated to the
long term operating performance of the Company. See 'Management's Discussion and
Analysis of Financial Condition and Results of Operations -- Quarterly Results.'
 
MANAGEMENT OF GROWTH
 
     The Company has recently experienced rapid growth in the number of its
employees, the size of its programs and the scope of its operations. This growth
has placed and will continue to place a strain on operational, human and
financial resources. The Company's ability to manage such growth effectively
will depend upon its ability to enhance its management team and its ability to
attract and retain skilled employees. The Company's success will also depend on
the ability of its officers and key employees to continue to implement and
improve its operational, management information and financial control systems,
and to expand, train and manage its workforce. There can be no assurance that
the Company will be able to manage its growth effectively. Failure to manage
growth effectively could have a material adverse effect on the Company's
business and results of operations. See 'Management's Discussion and Analysis of
Financial Condition and Results of Operations' and 'Business.'
 
POSSIBLE HEALTHCARE REFORM; IMPACT OF MANAGED HEALTHCARE PROGRAMS
 
     Healthcare reform measures have been considered by Congress and other
Federal and state bodies during recent years. The intent of the proposals
generally has been to reduce healthcare costs and the growth of total healthcare
expenditures and expand healthcare coverage for the uninsured. Although
comprehensive healthcare reform has been considered, only limited proposals have
been enacted. Comprehensive healthcare reform may be considered again and
efforts to enact reform bills are likely to continue. Implementation of
government healthcare reform may adversely affect promotional and marketing
expenditures by pharmaceutical companies, which could decrease the business
opportunities available to the Company. The Company is unable to predict the
likelihood of such legislation or similar legislation being enacted into law or
the effects that any such legislation would have on its business, results of
operations and financial condition.
 
     The primary trend in the United States healthcare industry is toward cost
containment. In recent years, managed care providers have been able to exercise
greater influence through managed treatment and hospitalization patterns, a
shift from reimbursement on a cost basis to per capita limits for patient
treatment and
 
                                       8
the use of formularies (lists of preapproved products that a physician may
prescribe). The increasing use of managed care, centralized purchasing
decisions, consolidations among and integration of healthcare providers are
continuing to affect purchasing and usage patterns in the healthcare system.
Decisions regarding the use of pharmaceutical products are increasingly being
consolidated into group purchasing organizations, regional integrated delivery
systems and similar organizations and are becoming more economically focused,
with decision makers taking into account the cost of the product and whether a
product reduces the cost of treatment. There can be no assurance the Company
will not be adversely affected by cost containment measures. Government or
private initiatives to further contain pharmaceutical pricing could have a
material adverse effect on the pharmaceutical industry, and thus on the Company.
See 'Business -- The CSO Industry.'
 
GOVERNMENT REGULATION
 
     The healthcare industry is subject to extensive regulation. Various laws,
regulations and guidelines promulgated by government, industry and professional
bodies affect, among other matters, the provision, licensing, labeling,
marketing, promotion, sale and distribution of healthcare services and products,
including pharmaceutical products. In addition, the Company is subject to the
rules and regulations promulgated by the Equal Employment Opportunity Commission
and similar state entities, which govern its recruiting and hiring practices and
its relationship with its employees. It is possible that additional laws,
regulations and guidelines or changes in current laws, regulations or guidelines
may be adopted in the future. The failure of the Company or its clients to
comply with such laws, regulations and guidelines, or any change in applicable
laws, regulations and guidelines could, among other things, limit or prohibit
certain business activities of the Company or its clients, subject the Company
or its clients to adverse publicity, increase the cost of regulatory compliance
or subject the Company or its clients to monetary fines or other penalties. Such
actions could have a material adverse effect on the Company's business, results
of operations, and financial condition. See 'Business -- Government and Industry
Regulation.'
 
FRAUD AND ABUSE LAWS
 
     The healthcare industry is subject to various Federal and state laws
pertaining to healthcare fraud and abuse including prohibitions on the payment
or acceptance of kickbacks or other remuneration in return for the purchase or
lease of products which are paid for by Medicare or Medicaid. Sanctions for
violating these laws include criminal penalties and civil sanctions, including
fines and penalties, and possible exclusion from Medicare, Medicaid and other
Federal healthcare programs. Although the Company believes its business
arrangements are outside the scope of such Federal and state fraud and abuse
laws, there can be no assurance that the Company's practices will not be
challenged under these laws in the future or that such a challenge would not
have a material adverse effect on the Company's business, financial condition
and results of operations. See 'Business -- Government Regulation.'
 
ABILITY TO ATTRACT AND RETAIN EXPERIENCED SALES REPRESENTATIVES
 
     The success and growth of the Company's business depends upon its ability
to attract and retain qualified and experienced sales representatives. There is
intense competition for experienced pharmaceutical sales representatives and
there can be no assurance the Company will be able to continue to attract and
retain such qualified personnel. The Company's inability to attract and retain
qualified sales representatives would have a material adverse effect on the
Company's business and results of operations. See 'Business -- Program
Description.'
 
COMPETITION; INDUSTRY CONSOLIDATION
 
     The Company primarily competes with in-house sales and marketing
departments of pharmaceutical companies, other CSOs and other third party
providers to the pharmaceutical industry, many of which possess substantially
greater capital, personnel and other resources than the Company. In addition to
the in-house sales forces of pharmaceutical companies, the Company's current
major competitors include CSOs such as Innovex Limited, a subsidiary of
Quintiles Transnational Corp., and the various sales and marketing affiliates of
Snyder Communications, Inc. As a result of competitive pressures, various sales
and marketing organizations providing services to the pharmaceutical industry
are consolidating and are becoming targets of global organizations. This trend
is likely to produce increased competition among CSOs for both clients and
acquisition candidates and increased competitive pressures on smaller providers.
If the trend in the pharmaceutical industry towards consolidation continues,
pharmaceutical companies may have excess in-house sales force capacity and may,
as a result, reduce or eliminate their use of CSOs. There are relatively few
barriers to entry into the CSO industry and
 
                                       9
there can be no assurance that, as the CSO industry continues to evolve,
additional competitors with greater resources than the Company will not enter
the industry or that the Company's customers will not choose to conduct more of
their sales services internally, with other CSOs or with organizations that can
provide a broader range of sales and marketing services. Although the Company
intends to monitor industry trends and respond accordingly, there can be no
assurance that the Company will be able to anticipate and successfully respond
to such trends. Increased competition may lead to price and other forms of
competition that may have a material adverse effect on the Company's business
and results of operations. See 'Business -- Competition.'
 
POTENTIAL LIABILITY
 
     The Company is engaged in the business of detailing pharmaceutical
products. Such activities could expose the Company to risk of liability for
personal injury or death to persons using such products, although the Company
does not commercially market or sell the products to end-users. While the
Company has not been subject to any claims or incurred any liabilities due to
such claims, there can be no assurance that substantial claims or liabilities
will not arise in the future. The Company seeks to reduce its potential
liability through measures such as contractual indemnification provisions with
clients (the scope of which may vary from client to client, and the performances
of which are not secured) and reliance on insurance maintained by clients. The
Company, however, could also be held liable for errors and omissions of its
employees in connection with the services it performs that are outside the scope
of any indemnity. The Company could be materially and adversely affected if it
were required to pay damages or incur defense costs in connection with a claim
that is outside the scope of the indemnification agreements; if the indemnity,
although applicable, is not performed in accordance with its terms; or if the
Company's liability exceeds the amount of applicable insurance or indemnity. The
Company currently does not carry product liability insurance and is not insured
against the errors and omissions of its employees. See 'Business--Liability and
Insurance.'
 
POTENTIAL EMPLOYEE CLAIMS
 
      The success of the Company's business is dependent on its ability to field
a high-quality sales force relatively quickly. As part of its recruiting and
hiring process, the Company conducts a thorough screening process, drug testing
and rigorous interviews. In addition, the Company must continually evaluate its
personnel and, when necessary, terminate some of its employees with or without
cause. Accordingly, the Company is subject to lawsuits relating to wrongful
termination, discrimination and harassment. The Company maintains employment
practice liability insurance, which insures it against claims made by its
employees with respect to matters relating to their employment. There can be no
assurance, however, that the Company will continue to maintain such policy or
that the scope or limits of such policy will cover asserted claims. The Company
could be materially and adversely affected if it were required to pay damages or
incur defense costs in connection with a claim by an employee that is outside
the scope of coverage of such policy. See 'Business -- Liability and Insurance.'
 
DEPENDENCE ON KEY PERSONNEL
 
     The Company depends on a number of key executives, including Charles T.
Saldarini, its President and Chief Executive Officer, and Steven K. Budd, its
Chief Operating Officer. The loss of the services of any of the Company's key
executives could have a material adverse effect on the Company's business,
financial condition and results of operations. The Company does not maintain
'key man' life insurance policies on any of its executives although it intends
to obtain a $5 million policy on the life of Charles T. Saldarini. There can be
no assurance that the Company will be able to obtain such insurance on terms
acceptable to the Company, if at all. See 'Management.'
 
CONTROL BY EXISTING SHAREHOLDER
 
     Following completion of this Offering, assuming the Underwriters'
over-allotment option is not exercised, John P. Dugan, Chairman of the Board of
Directors of the Company, will beneficially own approximately ___% (or ___% if
the over-allotment option is exercised in full) of the Company's outstanding
Common Stock (excluding shares issuable upon the exercise of options). As a
result, Mr. Dugan will have the ability to determine the election of all of the
Company's directors, and to determine the outcome of most corporate actions
requiring shareholder approval, including the merger of the Company with or into
another company, the sale of all or substantially all of the Company's assets
and amendments to the Company's Certificate of Incorporation (the 'Certificate
of Incorporation'). In addition, Mr. Dugan will have the power to delay, defer
or prevent a change in control of the Company. See 'Principal Shareholders.'
 
                                       10
ACQUISITION RISKS
 
     As part of its business strategy, the Company will evaluate new acquisition
opportunities. Acquisitions involve numerous risks, including difficulties in
the assimilation of the operations and products or services of the acquired
companies, the expenses incurred in connection with the acquisition and
subsequent assimilation of operations and products or services, the diversion of
management's attention from other business concerns and the potential loss of
key employees of the acquired company. Acquisitions of companies outside the
United States also may involve the additional risks of assimilating differences
in international business practices and overcoming language differences as well
as the risks inherent in conducting international business, including exposure
to currency fluctuations, difficulties in complying with a variety of foreign
laws, unexpected changes in regulatory requirements, difficulties in staffing
and managing foreign operations and potentially adverse tax consequences. There
can be no assurance that the Company will successfully identify, complete or
integrate any future acquisitions, or that acquisitions, if completed, will
contribute favorably to the Company's operations and future financial condition.
The Company may also face increased competition for acquisition opportunities,
which may inhibit the Company's ability to consummate suitable acquisitions on
terms favorable to the Company. See 'Use of Proceeds' and 'Business -- Growth
Strategy.'
 
UNSPECIFIED USE OF PROCEEDS
 
     None of the net proceeds that the Company will receive from this Offering
have been designated for any specific purpose. As a consequence, the Company's
management will have broad discretion with respect to the use of such proceeds.
The principal purposes of the Offering are to obtain additional working capital
for business expansion purposes, investment in infrastructure, to facilitate the
Company's access to public equity markets and to enhance the Company's ability
to use its Common Stock as consideration for possible acquisitions and as a
means of attracting and retaining key employees. Net proceeds from this Offering
will also be available for general corporate purposes, including replenishment
of working capital used to make the final distribution to the Company's existing
shareholders. A portion of the net proceeds may also be used to acquire or
invest in complementary businesses, products or services; however, there are no
commitments or agreements with respect to any such transaction at the present
time. See 'Use of Proceeds,' 'Dividend Policy' and 'S Corporation Termination.'
 
NO PRIOR TRADING MARKET; POTENTIAL VOLATILITY OF STOCK PRICE
 
     Prior to the Offering, there has been no public market for the Common
Stock, and there can be no assurance that an active trading market for the
Common Stock will develop or, if one does develop, that it will be maintained.
The initial public offering price, which will be established by negotiations
between the Company and representatives of the Underwriters, may not be
indicative of prices that will prevail in the trading market for the Common
Stock. The market price of the Common Stock could be subject to wide
fluctuations in response to variations in operating results from quarter to
quarter, changes in earnings estimates by analysts, market conditions in the
industry and general economic conditions. Furthermore, the stock market has
experienced significant price and volume fluctuations unrelated to the operating
performance of particular companies. These market fluctuations may have an
adverse effect on the market price of the Common Stock. See 'Underwriters.'
 
SHARES ELIGIBLE FOR FUTURE SALE
 
     Sales of substantial amounts of the Common Stock of the Company in the
public market, or the prospect of such sales, could have a material adverse
effect on the market price of the Common Stock. Immediately following the
Offering, the Company will have outstanding _______ shares of Common Stock
(excluding ______ shares reserved for issuance upon the exercise of outstanding
stock options). The _______ shares of Common Stock offered hereby (________ if
the Underwriters' over-allotment option is exercised in full) will be eligible
for public sale without restriction under the Securities Act of 1933, as amended
(the 'Securities Act') by persons other than 'affiliates' (as that term is
defined in Rule 144 under the Securities Act) of the Company. All of the
remaining ________ shares of Common Stock outstanding will be 'restricted
securities' within the meaning of Rule 144 and may not be resold in the absence
of registration under the Securities Act or pursuant to exemptions from such
registration including, among others, the exemption provided by Rule 144 under
the Securities Act. Taking into consideration the effect of the 180-day
'lock-up' agreements covering all of the restricted shares and options to
purchase an additional _______shares held by executive officers, such restricted
shares will be eligible for sale upon the expiration of the lock-up agreements,
subject to the provisions of Rule 144 or Rule 701 under the Securities Act.
 
                                       11
The Company intends to register on Form S-8 under the Securities Act as
soon as practicable after the effective date of the Offering, ______ shares of
Common Stock issued or reserved for issuance under the Company's 1998 Stock
Option Plan. This registration will be effective upon filing. As of December 31,
1997, there were outstanding options for the purchase of ______ shares of Common
Stock. Shares registered and issued pursuant to such registration statement will
be freely tradable except to the extent that the holders thereof are deemed to
be 'affiliates' of the Company, in which case the transferability of such shares
will be subject to the volume limitations set forth in Rule 144 under the
Securities Act. See 'Management -- 1998 Stock Option Plan,' 'Description of
Capital Stock,' 'Shares Eligible for Future Sale' and 'Underwriting.'
 
IMMEDIATE AND SUBSTANTIAL DILUTION
 
     The purchasers of shares of Common Stock pursuant to the Offering will
experience immediate and substantial dilution of the net tangible book value per
share of Common Stock from the initial public offering price. At the initial
public offering price of $____ per share, purchasers in the Offering will incur
dilution of $____ per share. Additional dilution is also likely to occur upon
exercise of options granted by the Company. See 'Dilution.'
 
NO DIVIDENDS
 
     Except for a final distribution to its shareholders immediately prior to
the Offering, the Company does not expect to declare or pay any dividends in the
foreseeable future. Instead, the Company intends to retain all earnings, if any,
in order to expand its operations. The payment of dividends, if any, in the
future is within the discretion of the Company's Board of Directors and will
depend upon the Company's earnings, if any, its capital requirements and
financial condition and other relevant factors. See 'Dividend Policy' and 'S
Corporation Termination.'
 
ANTI-TAKEOVER EFFECTS OF CERTAIN CHARTER, BYLAW AND OTHER PROVISIONS
 
     The Company's Board of Directors is authorized to issue up to 5,000,000
shares of Preferred Stock and to determine the price, rights, preferences and
privileges of those shares without any further vote or action by the Company's
shareholders. The rights of the holders of Common Stock will be subject to, and
may be adversely affected by, the rights of the holders of any shares of
Preferred Stock that may be issued in the future. While the Company has no
present intention to issue shares of Preferred Stock, such issuance, while
providing desirable flexibility in connection with possible acquisitions and
other corporate purposes, could have the effect of making it more difficult for
a third party to acquire a majority of the outstanding voting stock of the
Company. In addition, such Preferred Stock may have other rights, including
economic rights senior to the Common Stock, and, as a result, the issuance
thereof could have a material adverse effect on the market value of the Common
Stock. The Certificate of Incorporation provides for a classified Board of
Directors and members of the Board of Directors may be removed only for cause
upon the affirmative vote of holders of at least a majority of the shares of
capital stock of the Company entitled to vote. Furthermore, the Company is
subject to the anti-takeover provisions of Section 203 of the Delaware General
Corporation Law (the 'DGCL'), which prohibits the Company from engaging in a
'business combination' with an 'interested stockholder' for a period of three
years after the date of the transaction in which such person first becomes an
'interested stockholder,' unless the business combination is approved in a
prescribed manner. The application of these provisions could have the effect of
delaying or preventing a change of control of the Company. Certain other
provisions of the Certificate of Incorporation could also have the effect of
delaying or preventing changes of control or management of the Company, which
could adversely affect the market price of the Company's Common Stock. See
'Description of Capital Stock. '
 
                                       12
USE OF PROCEEDS
 
     The net proceeds to the Company from the sale of the ______ shares of
Common Stock being offered by the Company hereby are estimated to be $___
million ($____ million if the Underwriters' over-allotment option is exercised
in full), after deducting the underwriting discount and commissions and
estimated offering expenses payable by the Company. The principal purposes of
the offering of shares by the Company are to obtain additional working capital
for business expansion purposes investment in infrastructure, to facilitate the
Company's access to the public equity markets and to enhance the Company's
ability to use its Common Stock as consideration for possible acquisitions and
as a means of attracting and retaining key employees. Net proceeds from this
Offering will also be available for general corporate purposes, including
replenishment of working capital used to make the final distribution to the
Company's existing shareholders immediately prior to this Offering. A portion of
the net proceeds may also be used to acquire or invest in complementary
businesses, products or services; however, there are no commitments or
agreements with respect to any such transaction at the present time. Pending use
of the net proceeds for the above purposes, the Company intends to invest such
funds in short-term, interest-bearing, investment-grade obligations. See
'Dividend Policy.'
 
                                DIVIDEND POLICY
 
     The Company does not expect to declare or pay any cash or stock dividends
on its Common Stock in the foreseeable future and intends to retain future
earnings for the expansion of its business. Any future determination to pay cash
dividends will be at the discretion of the Company's Board of Directors and will
depend upon, among other things, the Company's results of operations, financial
condition, contractual restrictions and such other factors deemed relevant by
the Board.
 
     Historically, as an S Corporation, the Company has made special bonus
compensation payments to its shareholders based on its estimated profitability
and working capital requirements. Immediately prior to this Offering, the
Company will declare a final distribution estimated to be $___________ million
to its existing shareholders reflecting the aggregate shareholders' equity as of
the date of such distribution. Investors purchasing Common Stock in this
Offering will not receive any portion of such distribution and the Company will
not make any additional distributions of this kind in the future. See 'Use of
Proceeds' and 'S Corporation Termination.'
 
                           S CORPORATION TERMINATION
 
     The Company has been treated as an S Corporation for Federal income tax
purposes since January 1, 1991 and for purposes of the tax laws of the State of
New Jersey since January 1, 1994. As a result, the income of the Company has
been taxed at the shareholder level. Concurrent with the completion of this
Offering, the Company's S Corporation election will be terminated and the
Company will be subject to Federal and state corporate income taxation as a C
Corporation.
 
                                       13
CAPITALIZATION
 
     The following table sets forth the capitalization of the Company at
December 31, 1997 and as adjusted to reflect (i) the sale by the Company of
_______ shares of Common Stock in the Offering at the initial public offering
price of $__________ per share, after deducting underwriting discounts and
commissions and estimated expenses, and application of the estimated net
proceeds thereof and (ii) the final distribution to the Company's shareholders
immediately prior to the Offering. This table should be read in conjunction with
the Company's audited Financial Statements, including the notes thereto, which
appear elsewhere in this Prospectus.
AS OF
                                                                                            DECEMBER 31, 1997
                                                                                         ------------------------
                                                                                          ACTUAL      AS ADJUSTED
                                                                                         --------     -----------
                                                                                              (IN THOUSANDS)
Long-term obligations, less current portion..........................................    $     --      $      --
Shareholders' equity.................................................................
  Preferred shares, $.01 par value, 5,000,000 shares authorized;
     no shares issued and outstanding................................................          --             --
  Common shares, $.01 par value, 30,000,000 shares authorized;
     _________ issued and outstanding actual; ________ issued and
     outstanding, as adjusted(1).....................................................
  Additional paid-in capital.........................................................       4,194
  Retained earnings..................................................................      (3,416)
  Deferred Compensation..............................................................        (102)
                                                                                         --------     -----------
  Total shareholders' equity.........................................................
Total capitalization.................................................................    $             $
                                                                                         --------     -----------
                                                                                         --------     -----------
------------------
 
(1) Excludes (i) _____ shares of Common Stock issuable upon exercise of stock
    options outstanding on December 31, 1997 at a weighted average exercise
    price of $_______ per share and (ii) ______ additional shares of Common
    Stock reserved for future grants under the Company's 1998 Stock Option Plan.
    See 'Management -- 1998 Stock Option Plan.'
 
                                       14
DILUTION
 
     At December 31, 1997, the net tangible book value of the Company was $__
million, and the pro forma net tangible book value per share of Common Stock was
$________ (after giving effect to the final distribution estimated to be $______
million and the estimated $______ of deferred income tax benefits arising upon
termination of the Company's S Corporation status). See 'Dividend Policy' and 'S
Corporation Termination' and note 14 to the Company's Financial Statements.
After giving effect to the sale by the Company of _______ shares of Common Stock
in the Offering at the initial public offering price of $_______ per share and
after deducting underwriting discounts and commissions and estimated offering
expenses payable by the Company, the pro forma net tangible book value of the
Company at December 31, 1997 would have been $___ million or $____ per share.
This represents an immediate increase in net tangible book value of $____ per
share to existing shareholders of the Company and an immediate dilution of
$______ per share to new investors purchasing shares in this Offering.
 
     The following table illustrates such per share dilution:
The initial public offering price per share..............................................     $
Pro forma net tangible book value per share before the Offering (1)...........   $
Increase per share attributable to new investors..............................   $
Pro forma net tangible book value per share after the Offering...........................     $
Dilution per share to new investors (2)..................................................     $
------------------
 
(1) Pro forma net tangible book value per share of Common Stock is determined by
    dividing the Company's net tangible book value at December 31, 1997 of
    $_____ million by the pro forma number of shares of Common Stock
    outstanding.
 
(2) Dilution per share to new investors is determined by subtracting pro forma
    net tangible book value per share after the Offering from the initial public
    offering price per share.
 
     The computations in the table above exclude: (i) ______ shares of Common
Stock issuable upon the exercise of stock options outstanding at December 31,
1997 at a weighted average exercise price of $________ per share and (ii) _____
additional shares of Common Stock reserved for future grants under the Company's
1998 Stock Option Plan. See 'Management -- 1998 Stock Option Plan.'
 
                                       15
SELECTED FINANCIAL DATA
 
     The selected financial data set forth below for the five years ended
December 31, 1993, 1994, 1995, 1996 and 1997 have been derived from the
Company's Financial Statements and the notes thereto. Balance sheets at December
31, 1996 and 1997 and the statements of income, of shareholders' equity and of
cash flows for the three years ended December 31, 1995, 1996 and 1997 and notes
thereto appear elsewhere in this Prospectus and have been audited by Coopers &
Lybrand L.L.P., independent accountants. The selected financial data for the
years ended December 31, 1993 and 1994 have been derived from the Company's
unaudited Financial Statements which have been prepared by the Company in
accordance with generally accepted accounting principles and includes all
adjustments that management considers necessary for a fair presentation of the
data for such periods. The Company's unaudited Financial Statements for the
years ended December 31, 1993 and 1994 have not been included in this
Prospectus. The selected financial data set forth below should be read in
conjunction with, and are qualified by reference to 'Management's Discussion and
Analysis of Financial Condition and Results of Operations' and the Company's
audited Financial Statements and related notes appearing elsewhere in this
Prospectus.
 
STATEMENT OF OPERATIONS DATA:
YEAR ENDED DECEMBER 31,
                                                           -----------------------------------------------------
                                                            1993       1994       1995        1996        1997
                                                           ------     ------     -------     -------     -------
                                                           (IN THOUSANDS, EXCEPT PER SHARE AND STATISTICAL DATA)
Revenue................................................    $8,226     $8,250     $18,398     $33,015     $54,542
Program expenses.......................................     4,886      5,339      15,427      26,886      43,057
                                                           ------     ------     -------     -------     -------
Gross profit...........................................     3,340      2,911       2,971       6,129      11,485
Compensation expense...................................     1,945      1,673       2,124       3,191       5,121(1)
Bonus to majority shareholder(2).......................       440        200         425       1,500       2,243
Stock grant expense(3).................................        --         --          --          --       4,470
Other general, selling and administrative expenses.....       844        826       1,159       1,650       2,755
                                                           ------     ------     -------     -------     -------
Total general, selling and administrative expenses.....     3,229      2,699       3,708       6,341      14,589
                                                           ------     ------     -------     -------     -------
Operating income (loss)................................       111        212        (737)       (212)     (3,104)
Other income, net......................................        17         16          70          98         155
                                                           ------     ------     -------     -------     -------
Income (loss) before provision for taxes...............       128        228        (667)       (114)     (2,949)
Pro forma provision for (benefit from) income
  taxes(4).............................................        51         91        (121)         --          --
                                                           ------     ------     -------     -------     -------
Pro forma net income (loss)(4).........................    $   77     $  137     $  (546)    $  (114)    $(2,949)
                                                           ------     ------     -------     -------     -------
                                                           ------     ------     -------     -------     -------
Pro forma net income (loss) per share(4)...............
                                                                                                         -------
                                                                                                         -------
Pro forma weighted average number of shares
  outstanding..........................................
                                                                                                         -------
                                                                                                         -------
OTHER FINANCIAL DATA:
Adjusted operating income (loss)(5)....................    $  551     $  412     $  (312)    $ 1,288     $ 3,609
Adjusted net income (loss)(4)(5).......................       341        257        (145)        832       2,258
OTHER OPERATING DATA:
Number of detail programs..............................         8          9          10          13          15
Number of clients......................................         6          7           7           8          12
Average size of detail program.........................    $1,028     $  917     $ 1,840     $ 2,540     $ 3,636
Number of sales representatives at end of period:
  Full-time............................................        --         --          --          29         633
  Part-time............................................       107        107         393         709         362
                                                           ------     ------     -------     -------     -------
  Total................................................       107        107         393         738         995
                                                           ------     ------     -------     -------     -------
                                                           ------     ------     -------     -------     -------
See footnotes on following page
 
                                       16
BALANCE SHEET DATA:
AS OF DECEMBER 31,
                                                                      -----------------------------------------------
                                                                       1993      1994      1995      1996      1997
                                                                      ------    ------    ------    ------    -------
                                                                                      (IN THOUSANDS)
Cash and cash equivalents..........................................   $1,701    $  611    $  240    $2,403    $ 5,760
Working capital....................................................      (63)      130      (591)     (873)       129
Total assets.......................................................    2,243     6,975     5,881     8,322     13,691
Total long-term debt...............................................       --        --        --        --         --
Shareholders' equity (deficit).....................................       76       304      (363)     (478)       676
------------------
 
(1) Includes bonus compensation of $237,000 paid to Charles T. Saldarini, the
    Company's President, Chief Executive Officer and a minority shareholder. It
    is expected that, in addition to his base salary, Mr. Saldarini may receive
    cash bonuses in future periods as determined by the Compensation Committee.
    See 'Management -- Executive Compensation.'
 
(2) The Company has been treated as an S Corporation under subchapter S of the
    Code since January 1, 1991 and under the corresponding provisions of the tax
    laws of the State of New Jersey since January 1, 1994. Historically, as an S
    Corporation, the Company made annual bonus payments to its majority
    shareholder based on the Company's estimated profitability and working
    capital requirements. With the exception of the distribution to be declared
    immediately prior to the Offering, the Company does not expect to pay such
    bonuses in future periods. See 'Dividend Policy.'
 
(3) On January 1, 1997, the Company issued shares of its Common Stock to Charles
    T. Saldarini, its current President and Chief Executive Officer. As a
    result, prior to the Offering, Mr. Saldarini owns 15.0% of the Common Stock
    outstanding. For financial accounting purposes, a non-recurring, non-cash
    compensation expense was charged in the first quarter of 1997. See
    'Principal Shareholders,' 'Management,' 'Certain Transactions' and note 12
    to the Company's Financial Statements.
 
(4) As an S Corporation, the Company has not been subject to Federal or New
    Jersey corporate income taxes, other than a New Jersey state corporate
    income tax of approximately 2%. Rather, the income of the Company has been
    taxed at the shareholder level. Upon consummation of this Offering, the
    Company will no longer be treated as an S Corporation, and, accordingly,
    will be subject to Federal and state corporate income taxes. Pro forma
    provision for income taxes, net income, net income per share and adjusted
    net income for all periods presented reflect a provision for income taxes as
    if the Company had been taxed as a C Corporation for all periods.
 
(5) Adjusted to eliminate bonus to majority shareholder and stock grant expense.
    This presentation illustrates the Company's results of operations on an
    adjusted basis to reflect that the Company does not intend to pay bonuses to
    its majority shareholder or incur stock grant expense in future periods.
    These presentations should not be construed as an alternative to operating
    income or net income/(loss) (as determined in accordance with generally
    accepted accounting principles) as presented herein.
 
                                       17
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                 FINANCIAL CONDITION AND RESULTS OF OPERATIONS
 
     The following Management's Discussion and Analysis of Financial Condition
and Results of Operations should be read in conjunction with the Company's
Financial Statements and the notes thereto appearing elsewhere in this
Prospectus and contains trend analysis and other forward-looking statements that
involve substantial risks and uncertainties. The Company's actual results could
differ materially from those expressed or implied in the forward-looking
statements as a result of certain factors, including those set forth under 'Risk
Factors' and elsewhere in this Prospectus.
 
OVERVIEW
 
     The Company is a leading provider of comprehensive customized solutions on
an outsourced basis to the United States pharmaceutical industry. The Company
believes it has achieved this leadership position based on its 10 years of
industry experience and its relationships with many of the pharmaceutical
industry's largest companies. Since inception, the Company has designed
customized product detailing programs for approximately 25 clients, including
Pfizer, Inc., Astra Merck Inc., Glaxo Wellcome Inc. and Johnson & Johnson, Inc.
Such programs have been designed to promote more than 70 different products,
including such leading prescription medications as Prilosec(Registered),
Wellbutrin(Registered) and Cardura(Registered), as well as a number of
well-known OTC products such as Bayer(Registered) Aspirin, Pepcid AC(Registered)
and Monistat 5(Registered), to hospitals, pharmacies and physicians in
approximately 20 different specialties. The Company's primary objective is to
enhance its leadership position in the growing CSO industry and to become the
premier supplier of comprehensive sales solutions to the pharmaceutical industry
and other segments of the healthcare market.
 
     The Company has demonstrated strong internal growth generated by securing
new business from leading pharmaceutical companies and by renewing and expanding
programs with existing clients. The Company believes that it is one of the
largest CSOs operating in the United States measured both by revenue and number
of sales representatives used in programs. Revenue increased from $8.3 million
in 1994 to $54.5 million in 1997, a compounded annual growth rate of
approximately 87.7%. Gross profit increased from $2.9 million in 1994 to $11.5
million in 1997, a compounded annual growth rate of 58.0%. In addition, the
number of sales representatives (part-time and full-time) employed by the
Company has increased from approximately 100, as of December 31, 1993 to
approximately 1,000 as of December 31, 1997. Over that same period, the
Company's mix between part-time and full-time representatives shifted from 100%
part-time to 45% part-time. At December 31, 1997 the Company was in the process
of hiring in excess of 150 new sales representatives to meet its obligations
under new and existing programs.
 
     Historically, the Company has derived a significant portion of program
revenue from a limited number of major clients. In 1995, the Company's four
largest clients accounted for approximately 42%, 17%, 15% and 10%, respectively,
or a total 84%, of its revenue. In 1996, the Company's four largest clients
accounted for approximately 30%, 21%, 17% and 16%, respectively, or a total 84%,
of its revenue. In 1997, the Company's four largest clients accounted for
approximately 25%, 22%, 19% and 10%, respectively, or a total 76%, of its
revenue. Concentrations of business in the CSO industry are not uncommon and the
Company believes that pharmaceutical companies will continue to outsource larger
projects as the CSO industry grows and continues to demonstrate an ability to
successfully implement large programs. Accordingly, the Company is likely to
continue to experience significant client concentration in future periods.
 
     The Company is engaged by its clients to design and implement product
detailing programs for both prescription and OTC pharmaceutical products. Given
the customized nature of the Company's business, it utilizes a variety of
contract structures with its clients. Generally, contracts provide for a fee to
be paid based on the Company delivering a specified package of services.
Contracts typically include performance benchmarks, such as a minimum number of
sales representatives or a minimum number of calls. Under certain contracts, the
Company may be entitled to additional compensation based upon the success of the
program and/or subject to penalties for failing to meet stated performance
benchmarks. The Company typically receives a portion of its fee upon
commencement of the program to reflect the costs of implementing such program.
In addition, contracts typically provide that the Company is entitled to a fee
for each sales representative hired by the client during or at the conclusion of
a program.
 
     The Company's contracts generally are for terms of six months to one year
and are subject to renewal upon expiration. These contracts are terminable by
the client for any reason upon 30 to 90 days notice. The Company's contracts
typically provide for termination payments by the client upon a termination
without cause. While the 
 
                                       18
cancellation of certain of the Company's contracts by a client without cause may
result in the imposition of penalties on such client, such penalties may not act
as an adequate deterrent to the termination of any such contracts. In addition,
there can be no assurance that such penalties will offset the lost revenue or
the costs incurred by the Company as a result of the termination of such
contracts. Despite such payments, the loss or termination of one or more
contracts could adversely affect the Company's future revenue and profitability.
Contracts may also be terminated for cause based on, among other things, the
Company's failure to meet stated performance benchmarks. In such event, the
Company may be obligated to pay penalties. To date, no programs have been
terminated for cause.
 
     Generally, the Company recognizes revenue under the percentage of
completion method pursuant to which revenue is recorded as costs are incurred.
Revenue includes estimated earned fees or profits and is calculated based on the
relationship between direct program costs actually incurred, other than initial
direct program costs (as described below), and the estimated total of such
costs. Program costs consist of costs associated with the execution of a
detailing program. There are two significant categories of program costs:
personnel costs and initial direct program costs. Personnel costs, which
consititute the largest portion of program expenses, include all labor related
costs, such as salaries, bonuses, fringe benefits and payroll taxes for the
sales representatives and managers who are directly responsible for the
rendering of services in connection with a particular program. Initial direct
program costs are those costs associated with the recruitment and training of
the sales representatives in connection with a particular program, and are
deferred and recognized over the life of such program.
 
     Estimated revenue and program costs are reviewed and revised periodically
throughout the life of each program. Any adjustment to a program's revenue
resulting from such revisions is recorded on a cumulative basis in the period in
which the revisions are made. In the period in which it is determined that a
loss will result from the performance of a program, or that the Company will
incur a penalty in connection with such program, the entire amount of the
estimated ultimate loss or penalty is charged against such program's revenue.
The Company manages program expenses by carefully establishing and monitoring
program budgets and timetables and by closely tracking staffing requirements for
programs in progress and anticipated programs. The status of each program in
progress is reviewed regularly by program managers and senior management to
ensure client satisfaction and to monitor performance relative to internal
financial and operating expectations. The number of sales representatives
assigned to a program varies according to the size, complexity, duration and
demands of the program.
 
     General, selling and administrative expense include compensation expense,
bonus to majority shareholder, stock grant expense and other general, selling
and administrative expenses. Compensation expense consists primarily of salaries
and related fringe benefits for senior management and other administrative,
marketing, finance, information technology and human resources personnel who are
not directly involved with the execution of a particular program. Bonus to
majority shareholder reflects the cash bonus paid to the Company's majority
shareholder and Chairman of the Board, John P. Dugan. With the exception of the
final distribution declared immediately prior to the Offering, it is not
expected that the Company will pay bonuses to Mr. Dugan in any future periods.
See 'Dividend Policy.' Stock grant expense reflects the non-cash, non-recurring
charges related to the grant of _____ shares of Common Stock to the Company's
President and Chief Executive Officer, Charles T. Saldarini. As a result, prior
to the Offering, Mr. Saldarini owns 15.0% of the issued and outstanding Common
Stock of the Company. Finally, other general, selling and administrative
expenses include corporate overhead such as facilities costs, depreciation and
amortization expenses and professional services fees. The Company plans to
relocate to a new leased facility by the end of the second quarter of 1998 to
accommodate its growth. The Company anticipates increased rent and certain
one-time costs associated with such relocation. General, selling and
administrative expenses (excluding bonus to majority shareholder and stock grant
expense) as a percentage of revenue have generally declined as the Company has
spread its overhead expenses across its expanding revenue base. The Company
anticipates that general, selling and administrative expenses will continue to
decline as a percentage of revenue as its business grows, although such expenses
are expected to increase on an absolute basis.
 
     Prior to 1995, no single program implemented by the Company required more
than 60 sales representatives. At the end of 1994, the Company entered into an
agreement for a program that required in excess of 150 sales representatives.
The Company believes that this represented the beginning of a trend in the
industry towards larger programs. In order to meet the demands of this program
and future programs, both in terms of increased number of sales representatives
and the additional administrative requirements attendant thereto, the Company 
 
                                       19
made a significant investment in hiring additional administrative and management
personnel for recruiting, hiring and improving its management information
systems. As a result of these additional expenditures, the Company recorded an
operating loss in 1995. However, the additional investment in infrastructure and
information technology has enabled the Company to continue to pursue larger
contracts, which has accounted for a substantial portion of the Company's growth
beginning in 1995. The Company will continue to make such investments in future
years to maintain its high standards of quality and operating efficiency.
 
     The Company has been treated as an S Corporation for Federal income tax
purposes since January 1, 1991 and for New Jersey state income tax purposes
since January 1, 1994. Accordingly, the Company's income has been taxed directly
at the shareholder level rather than at the corporate level. Concurrent with the
completion of this Offering, the Company's S Corporation election will terminate
and the Company will be subject to corporate income taxation as a C Corporation.
For each of the periods in which the Company was an S Corporation, the statement
of income data in the 'Selected Financial Data' table reflects a provision for
income taxes on a pro forma basis as if the Company had been taxed as a C
Corporation during such periods.
 
RESULTS OF OPERATIONS
 
     The following table sets forth for the periods indicated, certain statement
of operations data as a percentage of revenue. The trends illustrated in this
table may not be indicative of future results.
YEAR ENDED DECEMBER 31,
                                                                         --------------------------------------
                                                                         1994       1995       1996       1997
                                                                         -----      -----      -----      -----
Revenue...............................................................   100.0%     100.0%     100.0%     100.0%
Program expenses......................................................    64.7       83.9       81.4       78.9
                                                                         -----      -----      -----      -----
Gross profit..........................................................    35.3       16.1       18.6       21.1
Compensation expense..................................................    20.3       11.5        9.7        9.4
Bonus to majority shareholder.........................................     2.4        2.3        4.5        4.1
Stock grant expense...................................................     0.0        0.0        0.0        8.2
Other general, selling and administrative expenses....................    10.0        6.3        5.0        5.0
                                                                         -----      -----      -----      -----
Total general, selling and administrative expenses....................    32.7       20.1       19.2       26.7
                                                                         -----      -----      -----      -----
Operating income (loss)...............................................     2.6       (4.0)      (0.6)      (5.6)
Other income, net.....................................................     0.2        0.4        0.3        0.3
                                                                         -----      -----      -----      -----
Income (loss) before provision for taxes..............................     2.8       (3.6)      (0.3)      (5.3)
Pro forma provision for (benefit from) income taxes...................     1.1       (0.6)       0.0        0.0
                                                                         -----      -----      -----      -----
Pro forma net income (loss)...........................................     1.7%      (3.0)%     (0.3)%     (5.3)%
                                                                         -----      -----      -----      -----
                                                                         -----      -----      -----      -----
YEARS ENDED DECEMBER 31, 1997 AND 1996
 
     Revenue.  Revenue for 1997 was $54.5 million, an increase of 65.2% over
1996 revenue of $33.0 million. Revenue in 1997 was generated from 15 programs
for 12 clients while 1996 revenue was generated from 13 programs for eight
clients. Average program size increased to $3.6 in 1997 from $2.5 in 1996.
Approximately $46.9 million, or 85.9% of 1997 revenue, was derived from seven
clients; those seven clients generated $31.0 million, or approximately 93.8% of
1996 revenue.
 
     Program expenses.  Program expenses for 1997 were $43.1 million, an
increase of 60.1% over program expenses of $26.9 million for 1996. As a
percentage of revenue, program expenses decreased to 78.9% for 1997 from 81.4%
for 1996. This decrease was primarily attributable to the Company continuing to
realize efficiencies as a result of the investments in infrastructure and
process improvements which were implemented in 1995 and 1996.
 
     Compensation expense.  Compensation expense for 1997 was $5.1 million
compared to $3.2 million for 1996. This increase was due to an increase in the
number of management and administrative personnel in 1997 over the 1996 number
necessitated by the expansion of the Company's business. As a percentage of
revenue, compensation expense was 9.4% for 1997 compared to 9.7% for 1996.

     Bonus to majority shareholder.  Bonus to majority shareholder for 1997 was
$2.2 million compared to $1.5 million for 1996.
 
                                       20
Stock grant expense.  In the first quarter of 1997, the Company incurred
non-recurring, non-cash charges of $4.5 million related to stock issued to
Charles T. Saldarini, the Company's President and Chief Executive Officer.
 
     Other general, selling and administrative expenses.  Other general, selling
and administrative expenses were $2.8 million for 1997, an increase of 67.0%
over other general, selling and administrative expenses of $1.7 million for
1996. As a percentage of revenue, other general, selling and administrative
expenses were 5.0% for 1997 and 1996.
 
     Operating loss.  Loss from operations for 1997 was $3.1 million compared to
$212,000 for 1996. Before bonus to majority shareholder and stock grant expense,
operating income for 1997 was $3.6 million or 6.6% of revenue, compared to $1.3
million, or 3.9% of revenue, for 1996.
 
     Other income, net.  Other income, primarily net interest income, for 1997
was $155,000, an increase of 58.2% over net other income of $98,000 for 1996,
due to the greater availability of funds for investment.
 
     Pro forma net loss.  Pro forma net loss for 1997 was $2.9 million compared
to a pro forma net loss of $114,000 for 1996. Pro forma net loss for both
periods assumes the Company was taxed for Federal and state income tax purposes
as a C Corporation, with no tax benefits assumed for the net operating losses in
1997 and 1996.
 
YEARS ENDED DECEMBER 31, 1996 AND 1995
 
     Revenue.  Revenue for 1996 was $33.0 million, an increase of 79.4% over
1995 revenue of $18.4 million. Revenue in 1996 was generated from 13 programs
for eight clients while 1995 revenue was generated from 10 programs for seven
clients. Average program size increased to $2.5 million in 1996 from $1.8
million in 1995. Substantially all of 1996 revenue, or 99.3%, was derived from
clients that accounted for $17.8 million, or 97.0%, of 1995 revenue.
 
     Program expenses.  Program expenses for 1996 were $26.9 million, an
increase of 74.3% over program expenses of $15.4 million for 1995. As a
percentage of revenue, however, program expenses decreased to 81.4% in 1996 from
83.9% in 1995. This decrease was primarily attributable to the Company beginning
to realize operating efficiencies as a result of the investments in
infrastructure and process improvement begun in 1995.
 
     Compensation expense.  Compensation expense in 1996 was $3.2 million
compared to $2.1 million in 1995. This increase was attributable to an increase
in the number of management and administrative personnel employed by the Company
in 1996 as compared to 1995 necessitated by the expansion of the Company's
business. As a percentage of revenue, compensation expense was 9.7% for 1996
compared to 11.5% for 1995.
 
     Bonus to majority shareholder.  Bonus to majority shareholder for 1996 was
$1.5 million compared to $425,000 for 1995.
 
     Stock grant expense.  There were no compensatory stock grants in either
period.
 
     Other general, selling and administrative expenses.  Other general, selling
and administrative expenses were $1.7 million in 1996 compared to $1.2 million
in 1995, an increase of 42.4%. As a percentage of revenue, other general,
selling and administrative expenses were 5.0% in 1996 compared to 6.3% in 1995.
 
     Operating loss.  Operating loss decreased to $212,000 in 1996 from $737,000
in 1995. Before bonus to majority shareholder, operating income in 1996 was $1.3
million compared to an operating loss of $312,000 in 1995.
 
     Other income, net.  Other income, primarily net interest income, was
$98,000 in 1996, an increase of 40.1% over other income of $70,000 in 1995, due
to the greater availability of funds for investment.
 
     Pro forma net loss.  Pro forma net loss for the year ended December 31,
1996 was $114,000 compared to $546,000 for the prior year. Pro forma net loss
for both periods assumes the Company was taxed for Federal and state income tax
purposes as a C Corporation, with no tax benefits assumed for the net operating
loss in 1996.
 
LIQUIDITY AND CAPITAL RESOURCES
 
     The Company's principal source of funds has been cash flow from operations.
Contracts generally provide for advance payments which typically fund the
initial costs of a program. To date, the Company's cash flow has been sufficient
to provide funds for working capital and capital expenditures.

     The Company has a $500,000 line of credit (the 'Credit Line') from a
commercial bank under which interest only is payable monthly on the outstanding
balance at a floating rate equal to 1% above the prime rate of 
 
                                       21
interest as published from time to time by The Wall Street Journal. In addition,
the Company has obtained a commitment from the bank for a $1 million line of
credit, the proceeds of which are to be used exclusively for capital
expenditures (the 'CAPEX Line'). The CAPEX Line would be for a term of nine
months and would bear interest payable monthly at a floating rate of interest
equal to 0.75% above the prime rate of interest. At the end of the nine months,
any outstanding balance is payable in 60 equal monthly installments of principal
and interest computed at the rate of 0.75% above the prime rate on the date of
conversion. The Credit Line and the CAPEX Line will be secured by a lien on all
of the assets of the Company and will be personally guaranteed by John P. Dugan,
the Company's majority shareholder and Chairman of the Board. The notes
evidencing the Credit Line and the CAPEX Line and the related security
agreements will contain covenants, representations and other provisions
customarily found in commercial loan documentation.
 
     As of December 31, 1997, the Company had cash and cash equivalents of $5.8
million and working capital of $129,000. In addition, the Company paid a cash
bonus aggregating $2.2 million to its majority shareholder John P. Dugan in
1997. Immediately prior to this Offering, the Company anticipates that it will
distribute approximately $____ million to its existing shareholders. See
'Dividend Policy.'
 
     For the year ended December 31, 1997, the Company generated $3.4 million of
net cash from operating activities as compared to $2.8 million of net cash
generated during the prior year. The increase in cash flow occurred despite the
loss generated from operations due to the positive effect of non-cash expenses
for depreciation and the stock grant to Charles T. Saldarini. In January 1997,
the Company issued shares of its Common Stock to its President and Chief
Executive Officer, Charles T. Saldarini. As a result, prior to the Offering, Mr.
Saldarini owns 15% of the outstanding shares of Common Stock. Such issuance
resulted in non-recurring, non-cash charges for the first quarter of 1997 in the
amount of $4.5 million.
 
     For the years ended December 31, 1997 and 1996, net cash used in investing
activities was $94,000 and $641,000, respectively. The primary use of cash in
both years was for investment in computer equipment in connection with the
expansion of the Company's business and in connection with advances to Boomer &
Son, Inc., a corporation that prior to 1998 was wholly-owned by John P. Dugan,
the Company's Chairman of the Board. See 'Certain Transactions.'
 
     Net cash provided by financing activities was $79,000 in 1997 as a result
of a $100,000 equipment loan provided by a commercial financial institution, net
of repayments. The Company expects to repay the balance of this loan in 1998.
There were no financing activities in 1996 or 1995.
 
     The Company has budgeted approximately $1.2 million for capital
expenditures in 1998, to be funded through cash generated from operations and
the CAPEX Line. During 1997, the Company's capital expenditures were $290,000.
 
     Where the Company bills clients for services before they have been
completed, billed amounts are recorded as billings in excess of costs, or
deferred revenue, and are recorded as income when earned. When services are
performed in advance of billing, the value of such services is recorded as
unbilled costs and accrued profits. As of December 31, 1997 and 1996, the
Company had $6.1 million and $3.9 million, respectively, of deferred revenue and
$5.0 million and $2.4 million, respectively, of unbilled costs and accrued
profits. Substantially all deferred and unbilled costs and accrued profits are
earned or billed, as the case may be, within 12 months of the end of the
respective period.
 
     The Company believes that the net proceeds from the sale of the Common
Stock offered hereby, together with cash flows from operations and existing cash
balances will be sufficient to meet its working capital and capital expenditure
requirements for the foreseeable future.
 
QUARTERLY RESULTS
 
     The Company's results of operations have been and are expected to be
subject to quarterly revenue fluctuations. Such fluctuations result from a
number of factors including, among other things, the timing of commencement,
completion or cancellation of major programs. In the future, revenue may
fluctuate as a result of such factors and a number of additional factors,
including delays or costs associated with acquisitions, government regulatory
initiatives and conditions in the healthcare industry generally. The Company
believes that because of such fluctuations, quarterly comparisons of its
financial results cannot be relied upon as an indication of future performance.

     The following table sets forth unaudited quarterly operating results for
the eight quarters ended December 31, 1997. The Company believes that this
unaudited information has been prepared on the same basis 
 
                                       22
as the annual Financial Statements and includes all adjustments consisting only
of normal, recurring adjustments, necessary for a fair presentation of the
information for the quarters presented, when read in conjunction with the
Company's Financial Statements and notes thereto included elsewhere in this
Prospectus.
 
QUARTERLY STATEMENT OF OPERATIONS DATA:
QUARTER ENDED
                                 ------------------------------------------------------------------------------------------
                                 MARCH 31,   JUNE 30,   SEPTEMBER 30,   DECEMBER 31,   MARCH 31,   JUNE 30,   SEPTEMBER 30,
                                   1996        1996         1996            1996         1997        1997         1997
                                 ---------   --------   -------------   ------------   ---------   --------   -------------
                                 (IN THOUSANDS)
Revenue........................   $ 5,370     $7,289       $ 9,351        $ 11,005      $10,775    $ 12,501      $14,703
Program expenses...............     4,316      5,963         7,539           9,068        8,612      10,053       11,651
                                 ---------   --------       ------      ------------   ---------   --------   -------------
Gross profit...................     1,054      1,326         1,812           1,937        2,163       2,448        3,052
Compensation expense(1)........       700        762           872             857        1,303       1,218        1,261
Bonus to majority
  shareholder(2)...............       375        375           375             375          561         561          561
Stock grant expense(3).........        --         --            --              --        4,470          --           --
Other general, selling and
  administrative expenses......       328        317           365             640          681         638          743
                                 ---------   --------       ------      ------------   ---------   --------   -------------
Total general, selling and
  administrative expenses......     1,403      1,454         1,612           1,872        7,015       2,417        2,565
                                 ---------   --------       ------      ------------   ---------   --------   -------------
Operating income (loss)........      (349)      (128)          200              65       (4,852)         31          487
Other income...................        --          9            16              73           11          38           61
                                 ---------   --------       ------      ------------   ---------   --------   -------------
Net income (loss)..............   $  (349)    $ (119)      $   216        $    138      $(4,841)   $     69      $   548
                                 ---------   --------       ------      ------------   ---------   --------   -------------
                                 ---------   --------       ------      ------------   ---------   --------   -------------
DECEMBER 31,
                                     1997
                                 ------------
Revenue........................    $ 16,563
Program expenses...............      12,741
                                 ------------
Gross profit...................       3,822
Compensation expense(1)........       1,339
Bonus to majority
  shareholder(2)...............         560
Stock grant expense(3).........          --
Other general, selling and
  administrative expenses......         693
                                 ------------
Total general, selling and
  administrative expenses......       2,592
                                 ------------
Operating income (loss)........       1,230
Other income...................          45
                                 ------------
Net income (loss)..............    $  1,275
                                 ------------
                                 ------------
------------------
(1) Compensation expense for 1997 includes bonus compensation of $237,000 paid
    to Charles T. Saldarini, the Company's President, Chief Executive Officer
    and a minority shareholder. It is expected that, in addition to his base
    salary, Mr. Saldarini may receive cash bonuses in future periods as
    determined by the Compensation Committee. See 'Management -- Executive
    Compensation.'
 
(2) Historically, as an S Corporation, the Company has made annual bonus
    payments to its majority shareholder based on its estimated profitability
    and working capital requirements. With the exception of the distribution to
    be declared immediately prior to the Offering, the Company does not expect
    to pay such bonuses in future periods. See 'Dividend Policy.'
 
(3) On January 1, 1997, the Company issued shares of its Common Stock to Charles
    T. Saldarini, its current President and Chief Executive Officer. As a
    result, prior to the Offering, Mr. Saldarini owns 15.0% of the Common Stock
    outstanding. For financial accounting purposes, a non-recurring, non-cash
    compensation expense was charged in the first quarter of 1997. See
    'Principal Shareholders,' 'Management,' 'Certain Transactions' and note 12
    to the Company's Financial Statements.
 
EFFECT OF NEW ACCOUNTING PRONOUNCEMENTS
 
     Statement of Financial Accounting Standards No. 130, Reporting
Comprehensive Income, was issued in June 1997 and is effective for fiscal years
beginning after December 15, 1997. This pronouncement establishes standards for
reporting and display of comprehensive income and its components in a full set
of general-purpose financial statements. The Company will adopt this
pronouncement in 1998 and does not expect its implementation will have a
material effect on the Company's Financial Statements as currently presented.
 
     Statement of Financial Accounting Standards No. 131, Disclosures About
Segments of an Enterprise and Related Information, was also issued in June 1997
and is effective for fiscal periods beginning after December 15, 1997. This
pronouncement establishes the way in which publicly held business enterprises
report information about operating segments in annual financial statements and
interim reports to shareholders. As the Company operates in a single business
segment the implementation of this standard is not expected to significantly
impact the Company's Financial Statements as currently presented.
 
                                       23
BUSINESS
 
INTRODUCTION
 
     The Company is a leading provider of comprehensive customized sales
solutions on an outsourced basis to the United States pharmaceutical industry.
The Company believes it has achieved this leadership position based on its 10
years of industry experience and its relationships with many of the
pharmaceutical industry's largest companies. Since inception, the Company has
designed customized product detailing programs for approximately 25 clients,
including Pfizer, Inc., Astra Merck Inc., Glaxo Wellcome Inc. and Johnson &
Johnson, Inc. These programs have been designed to promote more than 70
different products, including such leading prescription medications as
Prilosec(Registered), Wellbutrin(Registered) and Cardura(Registered), as well as
a number of OTC products such as Bayer(Registered) Aspirin, Pepcid
AC(Registered) and Monistat 5(Registered), to hospitals, pharmacies and
physicians in approximately 20 different specialties. The Company's primary
objective is to enhance its leadership position in the growing CSO industry and
to become the premier supplier of comprehensive sales solutions to the
pharmaceutical industry and other segments of the healthcare market.
 
     The Company is engaged by its clients on a contractual basis to design and
implement product detailing programs for both prescription and OTC
pharmaceutical products. Such programs typically include three phases: design,
execution and assessment. In the program design phase, the Company works with
the client to understand needs, define objectives, select targets and determine
appropriate staffing. Program execution involves recruiting, hiring, training
and managing a sales force, which performs detail calls promoting the particular
client's pharmaceutical products. Assessment, the last phase of the program,
involves measurement of sales force performance and program success relative to
the goals and objectives outlined in the program design phase.
 
     The Company has demonstrated strong internal growth generated by securing
new business from leading pharmaceutical companies and renewing and expanding
programs with existing clients. The Company believes that it is one of the
largest CSOs operating in the United States measured both by revenue and total
number of sales representatives used in programs. Revenue and gross profit grew
at compound annual rates of 87.7% and 58.0% respectively, between 1994 and 1997.
The number of sales representatives (both full-time and part-time) employed by
the Company has increased from approximately 100 as of December 31, 1993 to
approximately 1,000 as of December 31, 1997. Over that same period, the
Company's mix between part-time and full-time representatives shifted from 100%
part-time to 45% part-time. The Company has also experienced a consistently high
renewal rate among its clients. For example, for 1997, approximately 86% of the
Company's revenue was generated from clients that had contributed to the
Company's 1996 revenue.
 
     The Company believes that because of the benefits of outsourcing,
pharmaceutical companies have made a strategic decision to continue to outsource
a significant portion of their sales and marketing activities. The Company
believes that the trend toward the increased use of CSOs by pharmaceutical
companies will continue due to the following industry dynamics: (i)
pharmaceutical companies will continue to expand their product portfolios and as
a result will need to add sales force capacity, (ii) pharmaceutical companies
will continue to face margin pressures and will seek to maintain flexibility by
converting fixed costs to variable costs, and (iii) the availability of
qualified CSOs will provide an incentive to pharmaceutical companies to continue
to outsource this function.
 
     The Company believes that it is well positioned to benefit from these
growth opportunities. Through its 10 years of providing service to the United
States pharmaceutical industry, the Company has demonstrated that it is a
high-quality, results-oriented provider of detailing services. In addition, the
Company maintains a highly qualified sales force as a result of a rigorous
recruiting process and training programs that are comparable to those of the
pharmaceutical companies. The Company believes that one of its biggest
competitive advantages is its ability to provide customized solutions to its
clients. Finally, as one of the largest CSOs, the Company has achieved the size
and demonstrated the ability to perform large detailing programs and execute
several programs simultaneously.
 
     In order to leverage its competitive advantages, PDI's growth strategy
emphasizes: (i) enhancing its leadership position in the growing CSO market by
maintaining its historic focus on high-quality contract sales services and by
continuing to build and invest in the Company's core competencies and
operations; (ii) expanding both its relationship with existing clients and its
selling efforts to capture new clients; (iii) offering
 
                                       24
additional promotional, marketing and educational services and further
developing its existing detailing services; (iv) entering new geographic
markets; and (v) investigating and pursuing appropriate acquisitions of
detailing or detailing-related companies.
 
PRODUCT DETAILING
 
     Pharmaceutical companies incur substantial expenses in connection with
their sales and marketing activities. The Company estimates, based on industry
data, that in 1996 pharmaceutical companies in the United States expended
approximately $6.7 billion on promotional spending, including product detailing,
event spending, journal advertising, and, more recently, direct-to-consumer
advertising. The primary targets of this promotional activity are persons making
product selection decisions, including physicians and others legally authorized
to prescribe or dispense drug therapies. The Company estimates that, on average,
product detailing represents approximately 60% of a pharmaceutical company's
total promotional spending. According to Scott-Levin, pharmaceutical companies
in the United States spent approximately $4.5 billion on product detailing in
1996.
 
     The Company believes that product detailing is a highly effective means of
influencing the prescribing patterns of the targeted prescribers and, therefore,
it is the most commonly employed strategy to promote pharmaceutical products.
Product detailing involves face-to-face meetings between a sales representative
and a targeted prescriber. The target of a product detail is usually a physician
identified because of his or her specialty or prescribing patterns. However,
other legally authorized prescribers -- such as nurse practitioners, physician
assistants or pharmacists -- may also be targets for detailing. Detailing
generally occurs in physician offices and hospitals, although conventions and
trade association meetings may also provide an appropriate forum. The sales
representative is required to possess a high level of product knowledge, as well
as other technical and therapeutic expertise. The interaction itself involves a
technical review of the product's legally authorized indications and usage, role
in disease treatment, mechanism of action, side effects, dosing, drug
interactions, cost and availability (i.e., the 'details'). The sales
representative and the targeted prescriber will also typically discuss the types
of patients best suited for the particular product and how and when such
patients will best benefit from the product's use. Competitive products and
their relative strengths and weaknesses in contrast to the product being
detailed may also be discussed.
 
     Product detailing takes place in the context of a personal sales call
during which a sales representative typically will detail one to three products.
The amount of time devoted to each product detailed during a call depends upon
that product's detail position ('slot') within the call. A call may last as long
as eight to ten minutes or may be as short as one to two minutes, depending upon
a number of factors, principally the target prescriber's availability. Product
detailing typically takes place in selling cycles of four to eight weeks, during
which period the sales representative will attempt to call each targeted
prescriber in his or her geographic territory at least once. A single program
may have three to 12 cycles. The repeat interactions between the sales
representative and the targeted prescriber are intended to establish trust
between the sales representative and the targeted prescriber, influence the
prescribing pattern of the physician, obtain market share for new products,
maintain market share for existing products and build barriers to entry against
competing products.
 
THE CSO INDUSTRY
 
  OVERVIEW
 
     The CSO industry provides outsourced physician detailing programs to
pharmaceutical, medical device and diagnostic companies. CSOs have evolved from
providing detailing support for OTC products into a full-service industry
handling some of the leading ethical pharmaceutical compounds. Since the early
1990's, the pharmaceutical industry in the United States has increasingly used
CSOs to provide the detailing service required to introduce new products,
reintroduce older products, supplement existing sales efforts, raise promotional
barriers to entry for competitors and demonstrate the incremental sales impact
of detailing a particular product. While there is little available data
regarding the CSO industry, the Company believes that there are approximately
eight CSOs currently operating in the United States. The Company also believes
that only 17 of the 50 largest pharmaceutical companies in the United States,
measured by healthcare revenue, currently use CSOs. Finally, the Company
estimates that contract revenues for the CSO industry in the United States
increased from approximately $80 million in 1995 to $185 million in 1996 and
$325 million in 1997.
 
                                       25
The CSO industry emerged in the 1980's in the United Kingdom, where
regulatory and cost containment pressure, the Company believes, led
pharmaceutical companies to search for a more efficient method of promoting new
and existing products. Pharmaceutical companies discovered that CSOs were an
effective tool for shifting high fixed costs to variable costs by enabling them
to outsource their sales and marketing activities as a supplement to their own
internal sales efforts. The Company believes that similar regulatory and cost
containment dynamics have, and will continue, to shape the demand for contract
sales services in the United States. In response to cost and margin pressures
brought on by managed care in the early 1990's, the pharmaceutical companies in
the United States reduced the size of their internal sales forces. According to
Med Ad News, a leading medical advertising and communications trade publication,
since 1994 pharmaceutical companies have expanded their internal sales forces.
The Company estimates that at the end of 1997, the largest 50 pharmaceutical
companies in the United States employed approximately 50,000 full-time sales
representatives, a 19% increase since 1994. During this period the number of
sales representatives utilized by CSOs in the United States has also increased
from approximately 1,100 as of December 31, 1994 to approximately 6,300 at the
end of 1997. At the end of 1994, 1995, 1996 and 1997 the Company estimates that
the number of sales representatives utilized by the CSO industry in the United
States represented approximately 2.6%, 4.3%, 7.6% and 11.2%, respectively, of
the combined number of CSO and in-house pharmaceutical sales representatives
utilized by such pharmaceutical companies in those years. In addition, during
this period, the Company believes that the portion of full-time sales
representatives employed or used by the CSO industry has increased.
 
  TRENDS AFFECTING GROWTH
 
     The Company believes that because of the benefits of outsourcing,
pharmaceutical companies have made a strategic decision to continue to outsource
a significant portion of their sales and marketing activities. The Company
believes that the trend toward the increased use of CSOs by pharmaceutical
companies will continue because of the following industry dynamics:
 
     Expanding product portfolios.  The Company believes that the ability of
pharmaceutical companies to remain competitive and profitable depends upon their
ability to introduce new drugs. According to Pharmaceutical Research and
Manufacturers of America, an industry trade group ('PhRMA'), the pharmaceutical
industry spent $18.9 billion on research and development in 1997, an increase of
11.8% over 1996 research and development expenditure of $16.9 billion. In
addition, in 1996, the United States Food and Drug Administration (the 'FDA')
approved for sale 131 new drugs and drug indications. In 1994, 1995, 1996 and
1997, the FDA approved 22, 28, 53 and 39 new molecular entities, respectively,
as a result of its expedited review and approval procedures. As a result, the
pharmaceutical industry will require additional sales force capacity that, the
Company believes, will increase the demand for CSO services.
 
     Margin pressures.  The potential for implementation of national healthcare
reform in the early 1990s and the growing influence of managed care and
healthcare cost containment initiatives throughout the 1990s has created
pressure to reduce the rate of price increases for pharmaceutical products.
According to IMS America, a healthcare marketing information company ('IMS'),
prices for prescription products rose, on average, only 1.6% in 1996, and 1.9%
in 1995. These pressures have forced the pharmaceutical industry to focus on
increasing unit growth while reducing fixed operating costs. CSOs provide the
support necessary to increase unit growth while converting high fixed costs to
variable costs.
 
     Increased use of drug therapies.  The amount spent on prescription drugs
and the number of prescriptions filled has been steadily increasing. According
to IMS, in 1996 over $85.3 billion was spent on prescription drugs compared to
$77.4 billion in 1995. In addition, according to IMS, approximately 2.4 billion
prescriptions were filled in 1996 compared to 2.3 billion prescriptions in 1995.
The Company believes that this trend toward increased use of drug therapies will
continue as it is attributable to a number of factors that are not expected to
change over the near term, including the expedited FDA review process, an aging
population, an expanded portfolio of pharmaceutical products, the efficacy of
drug therapy and the lower cost of drug therapy relative to hospitalization and
medical procedures. As managed care programs have proliferated, an increasing
number of consumers benefit from low co-pay arrangements with respect to
prescription drugs. As a result, consumers consider prescription medication a
less expensive, relatively non-invasive alternative for treating illness and are
 
                                       26
increasingly likely to comply with their drug therapies. As the use of drug
therapies increases, so does the importance of product detailing.
 
     Importance of flexibility.  Pharmaceutical companies are outsourcing a
variety of their activities in order to maximize flexibility and reduce fixed
costs. The desire to maximize flexibility and reduce fixed costs is a major
factor in the increasing utilization of CSOs. Flexibility and adaptability in
sales and marketing are crucial for balancing cost containment pressures against
pricing pressure and expanded research and development expenditures. CSOs
enhance flexibility by maximizing the ability of pharmaceutical companies to
deploy their human resources more efficiently. Similarly, by using CSOs, it is
possible to convert the high fixed cost of building, training, deploying and
maintaining a sales force (i.e., salaries and other employee-related costs) into
a variable cost.
 
     Availability of qualified CSOs; ability to demonstrate success.  The
Company believes that the pharmaceutical industry will continue to utilize CSOs
as the CSO industry further demonstrates its ability to quickly mobilize trained
professional sales forces capable of supplementing the work and replicating the
results of the internal sales forces of the pharmaceutical companies. In
addition, the recent development of sophisticated prescription tracking systems
and advances in information technology have enabled pharmaceutical companies to
measure the impact of product detailing on sales and to assess the efficacy of
both internal and third party sales forces in ways that were not possible a few
years ago. Consequently, the Company believes that CSOs are becoming an
increasingly important resource advantage in the overall marketing and sales
efforts of pharmaceutical companies.
 
     Need to maximize return on investment.  The pharmaceutical industry is
characterized by intense competition, due, in part, to an increasing number of
products. In addition, as a result of managed care, government initiatives to
reduce healthcare costs and market forces, the pharmaceutical industry is
experiencing lower margins and increased pressure to contain price increases. To
maximize and deliver acceptable returns on investment (mostly in the form of
research and development expenditures), pharmaceutical companies must ensure
that their products are fully supported by sales and marketing efforts during
their entire life cycles. As the effective lives of drugs are threatened by
patent expirations and competition from new compounds, pharmaceutical companies
employ various strategies, including outsourcing sales efforts, to enable
products to achieve their maximum sales potential.
 
     In addition, the Company believes that other sectors of the healthcare
industry will contribute to the growth of CSOs. For example, the United States
biotechnology industry has grown rapidly in the last decade and is developing
significant numbers of new therapies that are now entering clinical trials.
Generally, these companies do not have the internal resources to market and sell
their products. Accordingly, the Company believes that, as biotechnology
products receive the necessary regulatory approvals, this industry will be
looking to outsource various functions, particularly sales and marketing.
 
COMPANY'S COMPETITIVE ADVANTAGES
 
     The Company believes that a significant market opportunity exists for CSOs
that can provide high-quality sales solutions across a variety of sales,
marketing and therapeutic applications and that have demonstrated a willingness
and ability to respond to the particular needs of clients.
 
     Reputation for quality.  Virtually every program designed by the Company
has met or exceeded the goals established at the beginning of the program. The
Company believes that these results have earned it a reputation in the industry
as a high-quality, results-oriented provider of detailing services. The
Company's success is illustrated by its long-standing relationship with such
'blue chip' clients as Pfizer, Astra Merck, Glaxo Wellcome and Johnson &
Johnson.
 
     High-quality sales force.  The Company's overall commitment to quality is
evidenced by its recruiting, hiring and training processes. The Company believes
that its recruiting and hiring process is one of the most comprehensive,
challenging, rigorous, selective and professional processes in the industry and
that its training programs are comparable to those designed by pharmaceutical
companies to train their internal sales forces. The Company offers its sales
representatives a compensation package that it believes is competitive with
compensation packages that the major pharmaceutical companies offer to their own
sales forces. Many of the Company's competitors use independent contractors as
sales representatives who are compensated based on the
 
                                       27
number of calls or on an hourly basis. All of the Company's personnel, including
sales representatives, managers and recruiting coordinators, are employees
rather than independent contractors. The Company believes that its treatment of
its sales representatives as employees and its compensation system are important
factors in its ability to attract and retain talented sales personnel. The
Company has found that a base salary and incentive bonus compensation package is
best suited for a results-oriented program and for achieving program objectives,
while a per call or hourly compensation structure emphasizes the number of
details rather than the quality of the detailing effort.
 
     Ability to design customized solutions.  The Company believes that its
ability to innovate and to provide a dedicated, vertically integrated sales
force custom-designed to meet the specific needs of a client is a principal
competitive advantage. Such customization includes the size, profile (i.e.,
part-time versus full-time), experience, training, geographic deployment and
allocation of the sales force against the targeted prescribers and the number of
calls for each targeted prescriber, the particular compensation package for the
sales force and field and database management support, such as in-house
territory mapping, physician satisfaction surveys, call reporting services and
regulatory compliance services. In particular, the Company believes that its
ability to provide full-time, part-time or a combination of full-time and
part-time sales representatives, constitutes a competitive advantage. Finally,
the Company's management and data information systems enable it to provide its
clients with information and services most of its competitors cannot, and thus
reduces the time and expense its clients would otherwise have to devote to a
product detailing program.
 
     Size and infrastructure.  The Company believes that its size,
organizational structure and overall resources enable it to implement multiple
programs simultaneously and to implement large programs that smaller CSOs may be
precluded from executing. The Company has made substantial investments in all of
its personnel and management information systems in order to be able to
successfully implement a variety of large and small programs simultaneously.
 
GROWTH STRATEGY
 
     The Company's objective is to enhance its leadership position in the
growing CSO industry and to become the premier supplier of comprehensive
customized sales solutions to the pharmaceutical industry and other segments of
the healthcare market. The following are the principal elements of the Company's
growth strategy:
 
      Enhance leadership position in growing CSO industry.  The Company believes
that its leadership position in the growing CSO industry is a result of its
competitive advantages. The Company is committed to maintaining its position as
a leader and innovator in the growing CSO industry by further developing its
core competencies -- recruiting, hiring and training, sales management,
information and data management, human resources and financial management. As
the CSO market expands, the Company is well positioned to sustain its growth.
 
     Strengthen relationships with existing clients.  Leveraging the past
success of its programs, the Company will actively seek to expand and renew
existing programs with existing clients and seek to capture new programs from
its existing clients by identifying new opportunities with such clients.
 
     Expand client base.  The Company believes that a significant opportunity
exists among pharmaceutical companies that do not currently utilize CSOs. The
Company has provided services to 11 of the 50 largest pharmaceutical companies
in the United States, measured by healthcare revenues. The Company believes that
33 of such companies do not currently use any CSOs. The Company will seek to
expand its client base by targeting pharmaceutical companies that are not
currently clients and which have attractive product portfolios. In addition,
future initiatives may focus on other sectors of the healthcare market that
could benefit from the Company's services, such as biotechnology companies and
medical device manufacturers.
 
     Provide additional services.  As a leading provider of physician detailing
programs, the Company believes that it has an established platform from which to
offer complementary promotional and marketing services to its clients. The
Company will leverage its core competencies to further develop its specialized
sales forces to meet the needs of its clients.
 
                                       28
Enter new geographic markets.  The Company will look for opportunities to
provide promotional services in markets outside the United States. This
expansion may be in the form of strategic joint ventures or acquisitions or by
building a presence using the Company's own internal resources.
 
     Pursue strategic acquisitions.  The Company intends to explore strategic
acquisitions in complementary and existing business areas. The Company believes
that by acquiring other CSOs and/or sales and marketing companies it may be able
to accelerate the development of a broader array of services or expand existing
services more efficiently and rapidly than developing these service capabilities
internally. In addition, the Company may pursue acquisitions in order to enter
new markets, where it currently has no presence.
 
PROGRAM DESCRIPTION
 
     The Company's customized detailing programs typically contain three basic
elements: design, execution and assessment. In the program design phase, the
Company undertakes to understand the needs and objectives of the client,
identifies, defines and ranks the proposed target audience and determines
appropriate staffing. In the program execution phase, the Company recruits,
hires, trains and manages the sales force. Finally, in the program assessment
phase, the Company measures the performance of the sales force and the success
of the program relative to the goals and objectives of the program. While each
program relies on the same basic core competencies, programs are custom-designed
to provide significant strategic advantages to the client by taking into account
the geographic, marketing and scheduling needs of the client, the product itself
and the profile of the target audience.
 
  PROGRAM DESIGN
 
     Prior to entering into a contract and usually in response to a request for
a proposal, the Company sets forth the details of a program in a comprehensive
proposal. The purpose of the proposal is to create an overall approach to the
program, which helps the Company establish a 'plan of action' for launch and
subsequent implementation. Among other things, the Company will use the proposal
to clarify the goals of the program and to analyze any data supplied by the
client in connection with its request. For example, as part of its pre-program
assessment, the Company will analyze the target physician list provided by the
client, which can include the names of 100,000 or more physicians, for the
purpose of targeting the most productive physicians in the most efficient
manner. The Company ranks the targeted prescribers based on statistical data
such as number of prescriptions written, prior coverage for the product and for
the general pharmaceutical class to which such product belongs, as well as the
product and class history among the proposed audience. The proposal incorporates
the Company's recommendations regarding territory mapping and the allocation of
sales representatives and sales managers within such territories. This results
in more efficient use of sales representatives, better target audience
penetration, reduced sales force turnover and, ultimately, maximum impact on
sales. This process is also instrumental in structuring compensatory
arrangements and payment terms.
 
     Staffing requirements.  In the program design phase, the Company identifies
the assets to be committed to the program (i.e., divisional managers, district
managers, field managers and sales representatives), the profile of the sales
representatives (i.e., part-time and full-time), training requirements, the
deployment of the sales force in terms of geography, the number of details per
call and the number of times each target will be called over a defined period of
time ('call-back frequency'). In determining staffing requirements, the Company
takes into account a number of considerations, including the preferences of the
client, the size of the individual territories, the number of targeted
physicians in a given territory, the call-back frequency and the cost
effectiveness of a full-time or part-time representative. The Company believes
that its ability to provide both full-time and part-time sales representatives
is important to providing its clients with a customized sales force able to meet
the goals of the sales program in a cost effective manner.
 
     Deployment strategy.  In the program design phase, the Company performs
'territory mapping'-- i.e., a plan to deploy the sales force over the geographic
region in which the targeted prescribers are located. The Company analyzes the
physician target list for the purpose of grouping the targets according to
selected criteria. The Company believes that its mapping and territory
deployment analysis gives it a competitive advantage over other CSOs in pricing
contracts and ensuring the success of the program.
 
                                       29
Return on investment models.  The goal of any program is to maximize
results from the promotional dollars spent by the client. Accordingly, in
connection with its pre-program assessment and analysis, the Company develops a
Return on Investment ('ROI') model for the program. The model can be used to
establish goals for the program and enables clients to clearly quantify the
value of the services provided by the Company. The ROI model has the ability to
project program effectiveness in incremental net sales, and may ultimately be a
key factor in demonstrating why a program should be renewed or expanded. The ROI
model is based on a confidential set of data and is considered proprietary by
the Company.
 
  PROGRAM EXECUTION
 
     The Company believes that its ability to recruit quickly on a national
basis, the quality of its training programs, the experience of its management
and its data and management information systems provide clients with a highly
effective sales force designed to meet a program's needs.
 
     Recruiting and hiring.  Recruiting and hiring the best qualified sales
personnel quickly is vital to ensure positive program results and minimize
turnover. The Company maintains a disciplined and efficient recruiting process
that is managed by a National Manager of Recruiting overseeing a staff of 10,
including five regional Recruiting Managers. This structure facilitates
recruiting on a region by region basis, thus saving time and money.
 
     The Company has developed a multi-step recruiting and hiring process that
it believes is comprehensive, rigorous, selective and professional. The Company
maintains a database of resumes of qualified, potential sales representatives.
The Company has also developed a relationship with a national recruiting firm in
the healthcare field and maintains an extensive referral system. Placing
advertisements in local publications through the services of a single source
provides cost and process control over the Company's recruitment efforts. The
recruiting and hiring process includes preliminary screening procedures,
background checks where required by the client, reference checks, drug testing
and a rigorous interview process during which candidates are required to sit for
multiple interviews with different sales managers. Typically, one to three
percent of the initial applicants screened in connection with a program are
hired. The result is an experienced, highly-qualified and motivated sales force.
 
     All of the Company's field sales personnel, including sales
representatives, managers and recruiting coordinators, are employees rather than
independent contractors. In addition, the Company offers its sales
representatives a compensation package that it believes is competitive with
compensation packages offered by the major pharmaceutical companies. The
compensation package offered by the Company includes a base salary and
performance-based incentives that relate to the specific goals of the program,
as well as fringe benefits, including a car allowance and, for full-time sales
representatives, health insurance coverage. The Company believes that its
treatment of its sales representatives as employees and its compensation system
are important factors in its ability to attract and retain talented sales
personnel. The Company has found that a base salary and incentive bonus
compensation package is best suited for a results-oriented program and for
achieving program objectives, while a per call or hourly compensation structure
emphasizes the number of details rather than the quality of the detailing
effort. In addition, treating its sales representatives as employees enhances
the Company's ability to direct and manage the daily activities of its field
force and integrate with its clients' sales teams. It also allows the Company to
provide career advancement opportunities -- a powerful motivational tool.
 
     Training.  The Company's Training and Development Department consists of a
National Training and Development Manager, a Director of Sales, Training and
Development and six dedicated Training Managers. In connection with each
program, the Company undertakes the training of the district managers and the
sales representatives with respect to the products being detailed. The training
programs are designed jointly by the Company and the client and are comparable
to the training programs employed by the client for its own internal sales
force. The client will either participate with the Company in the training, or
train the Company's managers who will then implement the training program. Each
sales representative is required to complete one to two weeks of home study and
attend a three day to three week training seminar. Typically, training involves
written material as well as seminars and other presentations which all sales
representatives are required to attend. All training programs dedicate time to
workshops and interactive role playing. The Company's sales representatives use
the same manuals and materials and must pass the same product knowledge tests as
the client's in-house sales
 
                                       30
representatives. In-field training continues at the local level as determined by
the National Sales Manager of the program.
 
     Sales management.  The Company's sales programs are supervised by two Vice
Presidents who report to the Chief Operating Officer. Each Vice President
manages four to six programs and is responsible for the overall execution of
each program, including the performance of the entire sales force
(representatives and managers), monitoring the product sales generated and
client satisfaction. Each program has a dedicated National Sales Manager, field
managers (Division and District Managers) and sales representatives. A National
Sales Manager may also have several Regional Managers reporting to him. Programs
may also have one or more dedicated program trainers. Division Managers
(full-time) and District Managers (part-time) are responsible for the direct
supervision of the field sales representatives. A Division Manager normally
manages ten to twelve representatives, while a District Manager usually manages
six to eight.
 
  PROGRAM ASSESSMENT
 
     Data and information management and reporting.  The Company's database
management group and call reporting center monitor each program. The operations
area handles hundreds of thousands of detail call reports per year, producing
all related reports for the sales teams, management and the client. This
comprehensive operations support frees up client and management resources that
would otherwise be burdened. Each sales representative is required to file call
activity reports on a daily basis. The reports reflect the sales
representative's activities since his last report including the number of calls,
the number of details as well as a confirmation signature from the target
prescriber. To date, the Company's call reporting system has been a paper based
system. However, the Company has recently instituted a program whereby certain
sales representatives will be given palm top computers. This program will
facilitate the submission of call activity reports and reduce the time required
to produce management reports.
 
     The Company has developed several management tools to maximize the
effectiveness of its sales forces. These management tools can be used to track
the overall effectiveness of the program as well as the performance of
individual sales representatives. One such tool is the Integrated Sales and
Activity Report ('ISA'), which allows the sales representatives to tailor
strategies and to evaluate the effectiveness of their sales efforts. The ISA is
generally produced bi-monthly and compares the current period to the prior
period. The report can be customized to reflect progress made toward a specific
goal or target for purposes of evaluating a program.
 
     Physician satisfaction surveys.  In connection with each program, the
Company develops a program-specific physician satisfaction survey ('PSS'). The
PSS is periodically sent out to selected members of the target audience,
depending on the size of the program. The PSS solicits comments on a variety of
topics relating to the call, including the professionalism of the sales
representative and current prescribing patterns. Finally, the survey asks the
physician to confirm his signature. These surveys are an indispensable tool,
both for determining the effectiveness of the program designed by the Company
and assessing the performance of the Company's sales force.
 
     Product sample tracking.  Federal laws and regulations require that
detailed records be kept concerning the distribution of pharmaceutical product
samples. These record keeping requirements are the responsibility of the
manufacturer. The Company has developed a sample tracking system that it
believes complies with such laws and regulations. As part of its services, the
Company performs this function on the client's behalf.
 
     Quantitative analysis.  At the conclusion of each program the Company
prepares a case study for the client that documents the results of the program
relative to the goals established at the outset of the program as well as the
ROI.
 
SPECIALIZED DETAILING FORCES AND SERVICES
 
     In addition to the traditional, custom-designed, client-dedicated,
long-term (one year or longer) detailing sales force program, the Company has
developed specialized detailing forces and services, described below, to address
varying needs of the pharmaceutical industry. While these services do not
currently represent a material portion of the Company's business, they are
considered important to the Company's future growth.
 
                                       31
Strike Force.  Strike Force is a sales force designed for fast roll-out and
short time frames (six months or less). Strike Force is generally used in
situations where the client requires short-term detailing support and faster
penetration of the target audience. Examples of applications for Strike Force
include seasonal brands, new product launches, conversion from prescription to
OTC and gaps in product coverage. For example, Strike Force was used by one
client to launch a new formulation of its children's cough and cold product. The
main objective was to increase pediatrician awareness and recommendations during
the cough and cold season.
 
     Share Force.  Share Force is a sales force designed to detail up to three
products from the same or different manufacturers to the same target audience.
The Share Force program offers clients flexibility in terms of pricing
(depending on the slotting) and program length, as well as access to
pre-targeted high volume prescribers. The Company assembles a sales team
targeted at a fixed list of physicians within a specialty that it believes to
represent a high volume prescribing audience. These physicians are selected and
profiled through the use of prescription data to ensure that they represent the
most productive physicians (in terms of prescriptions written) within multiple
therapeutic categories. Fees are determined by the detail position, or priority,
given to a particular product (known as 'slotting'). The Company has commenced
marketing Share Force but has not yet deployed any such force.
 
     Staffing Services.  The Company acts as a recruiting and placement agency,
using its skills in recruiting and hiring to help a client build its own
internal sales force. The Company performs all screening, checking, testing and
interviewing functions and then refers the most qualified candidates to the
client for final approval. The Company typically receives a fee for each sales
representative hired by the client.
 
     Sales Force Build.  Sales Force Build is a variation on Staffing Services.
The Company assembles a customized, client-dedicated sales force, designed at
the outset of a program with the specific intent that the client will hire the
sales representatives either at the conclusion of the program or at a
pre-determined time. In addition to the program fees, the Company receives a
placement fee for those sales representatives hired by the client.
 
     Convention Plus.  The Company provides custom-designed teams for trade show
and convention management support. Instead of staffing conventions with its own
sales representatives, which results in lost sales calls, the client engages the
Company to manage every aspect of the convention including registration, set-up,
staffing and reporting. The team can be built exclusively for one client or
shared by several clients.
 
CLIENTS AND CONTRACTS
 
  CLIENTS
 
     The Company believes that its relationships with its clients, which include
many of the largest pharmaceutical companies in the United States, are among its
most important strategic assets and competitive advantages. The Company has
enjoyed long-standing relationships with many of these clients, and a high
percentage of its clients either renew their programs or enter into new
contracts with the Company for new programs. The Company believes that the
quality and stability of its client base promotes the consistency of its core
business and that the scope and complexity of its clients' marketing needs
present opportunities for expansion into new areas. There can be no assurance,
however, that the Company's clients will continue to renew or expand their
relationship with the Company.
 
     During 1997, the Company executed 15 detailing programs for 12 clients. In
1997, Pfizer, Glaxo Wellcome, Astra Merck and Novartis accounted for 25%, 22%,
19% and 10%, respectively, of the Company's revenue. Collectively, these four
clients accounted for approximately 76% of the Company's revenue. The loss of
any one of the foregoing clients could have a material adverse impact on the
Company's business. In 1996, Pfizer, Astra Merck, Novartis and Johnson & Johnson
each accounted for 10% or more of the Company's revenue. Collectively, these
clients accounted for approximately 84% of the Company's revenue. In 1995, one
program accounted for more than 42% of the Company's revenue and three other
programs each accounted for 10% or more of the Company's revenue. Collectively,
these four programs represented approximately 84% of the Company's revenue. In
1994, two programs each accounted for more than 30% of the Company's revenue and
another program accounted for 10% or more of the Company's revenue. Together,
the three programs represented approximately 83% of the Company's revenue.
 
                                       32
CONTRACTS
 
     Given the customized nature of the Company's business, it utilizes a
variety of contract structures with its clients. Generally, contracts provide
for a fee to be paid based on the Company delivering a specified package of
services. Contracts typically include performance benchmarks, such as a minimum
number of sales representatives or a minimum number of calls. In certain
instances, the Company may be entitled to additional compensation based upon the
success of the program and/or subject to penalties for failing to meet stated
performance benchmarks. The Company typically receives a portion of its fee upon
commencement of the program to reflect the costs of implementing such program.
In addition, contracts typically provide that the Company is entitled to a fee
for each sales representative hired by the client during or at the conclusion of
a program.
 
     The Company's contracts generally are for terms of six months to one year
and are subject to renewal upon expiration. However, the Company's contracts are
terminable by the client for any reason upon 30 to 90 days notice. The Company's
contracts typically provide for termination payments by the client upon a
termination without cause. While the cancellation of certain of the Company's
contracts by a client without cause may result in the imposition of penalties on
such client, such penalties may not act as an adequate deterrent to the
termination of any such contracts. In addition, there can be no assurance that
such penalties will offset the lost revenue or the costs incurred by the Company
as a result of such termination. The loss or termination of a large contract or
the loss of multiple contracts could adversely affect the Company's future
revenue and profitability. Contracts may also be terminated for cause if the
Company fails to meet stated performance benchmarks. To date, no programs have
been terminated for cause.
 
     The Company's contracts typically contain cross-indemnification provisions
between the Company and its client. Typically, the client will indemnify the
Company against product liability and related claims arising from the sale of
the product and the Company indemnifies the clients with respect to the errors
and omissions of the Company's sales representatives in the course of their
detailing activities. To date, the Company has not asserted, nor has there been
asserted against the Company, any claim for indemnification pursuant to a
contract.
 
MARKETING AND BUSINESS DEVELOPMENT
 
     Most of the Company's revenue is derived from renewals and extensions of
existing programs and new programs with existing clients. The Company derives
new business from responses to 'requests for proposals' from pharmaceutical
companies that the Company believes are the result of its promotional and
advertising efforts. Recently, the Company has increasingly engaged in proactive
efforts to generate more business from new and prospective clients. The Company
has implemented a sales process that is designed to leverage its results-
oriented image through case studies, references, ROI models and comprehensive
proposals. The Company also has implemented an enhanced marketing and new
business development process for the purpose of improving its ability to secure
more contracts both within the pharmaceutical industry and in other healthcare
markets. This new business development process relies on the use of a dedicated
sales and marketing team.
 
     The Company seeks to promote awareness of its capabilities to senior level
executives, product managers and sales managers of both its existing and
potential clients so that when situations arise where additional product
detailing services are needed, those prospects are already aware of the Company
and its image as a high-quality, results-oriented firm. In order to build and
sustain awareness of its services, a combination of trade journal advertising,
mailings, and a public relations campaign are utilized. The Company advertises
in publications such as Pharmaceutical Executive and Med Ad News. The marketing
department maintains a proprietary mailing list of over 3,000 pharmaceutical
industry personnel including CEOs, vice presidents and marketing, sales and
product managers. In addition to its ongoing monthly mailings, the Company also
conducts specialized mailings in response to contacts received from specific
companies or about specific developments within the industry. The public
relations campaign also involves interviews in trade journals and other
publications and speaking engagements for the Company's executives.
 
                                       33
COMPETITION
 
     The primary competitive factor affecting contract sales services is the
ability to quickly hire, train, deploy and manage qualified sales
representatives to implement simultaneously several large product detailing
programs. The Company also competes with other CSOs on the basis of such factors
as its reputation, quality of its services, experience of management,
performance record, customer satisfaction, ability to respond to specific client
needs, integration skills and price. The Company believes it competes favorably
with respect to each of these factors.
 
     The Company primarily competes with in-house sales and marketing
departments of pharmaceutical companies, other CSOs and other third party
providers to the pharmaceutical industry, many of which possess substantially
greater capital, personnel and other resources than the Company. In addition to
the in-house sales forces of pharmaceutical companies, the Company's current
major competitors include CSOs such as Innovex Limited, a subsidiary of
Quintiles Transnational Corp., and the various sales and marketing affiliates of
Snyder Communications, Inc. As a result of competitive pressures, various sales
and marketing organizations providing services to the pharmaceutical industry
are consolidating and are becoming targets of global organizations. This trend
is likely to produce increased competition among CSOs for both clients and
acquisition candidates and increased competitive pressures on smaller providers.
If the trend in the pharmaceutical industry towards consolidation continues,
pharmaceutical companies may have excess in-house sales force capacity and may,
as a result, reduce or eliminate their use of CSOs. There are relatively few
barriers to entry into the CSO industry and there can be no assurance that, as
the CSO industry continues to evolve, additional competitors with greater
resources than the Company will not enter the industry or that the Company's
customers will not choose to conduct more of their sales services internally,
with other CSOs or with organizations that can provide a broader range of sales
and marketing services. Although the Company intends to monitor industry trends
and respond accordingly, there can be no assurance that the Company will be able
to anticipate and successfully respond to such trends. Increased competition may
lead to price and other forms of competition that may have a material adverse
effect on the Company's business and results of operations.
 
GOVERNMENT AND INDUSTRY REGULATION
 
     The healthcare industry is subject to extensive regulation. Various laws,
regulations and guidelines promulgated by government, industry and professional
bodies affect, among other matters, the provision, licensing, labeling,
marketing, promotion, sale and reimbursement of healthcare services and
products, including pharmaceutical products. It is also possible that additional
or amended laws, regulations or guidelines could be adopted in the future.
 
     The pharmaceutical industry is subject to extensive federal regulation and
oversight by the FDA. For instance, the Federal Food, Drug and Cosmetic Act, as
supplemented by various other statutes, regulates, among other matters, the
approval, labeling, advertising, promotion, sale and distribution of drugs,
including the practice of providing product samples to physicians. Under this
statute, the FDA asserts its authority to regulate all promotional activities
involving prescription drugs. In addition, the sale or distribution of
pharmaceuticals may also be subject to the Federal Trade Commission Act
('FTCA'). Finally, the Prescription Drug Marketing Act ('PDMA') regulates the
ability of pharmaceutical companies to provide physicians with free samples of
their products. Essentially, the PDMA requires extensive record keeping and
labeling of such samples for tracing purposes. Accordingly, the business of the
Company and its clients, to the extent such business involves promotion and
marketing of pharmaceutical products, are subject to the extensive regulation
governing the pharmaceutical industry, and there can be no assurance that the
Company will not be subject to increased regulatory scrutiny in the future.
 
     In addition, some of the services that the Company may provide in the
future are affected by various guidelines promulgated by industry and
professional organizations. For example, certain ethical guidelines promulgated
by the American Medical Association ('AMA') govern, among other matters, the
receipt by physicians of gifts from health-related entities. These guidelines
govern the honoraria, and other items of pecuniary value, which AMA member
physicians may receive, directly or indirectly, from pharmaceutical companies.
Similar guidelines and policies have been adopted by other professional and
industry organizations, such as PhRMA.
 
                                       34
The healthcare industry is subject to federal and state laws pertaining to
healthcare fraud and abuse. In particular, certain federal and state laws
prohibit manufacturers, suppliers and providers from offering or giving or
receiving kickbacks or other remuneration in connection with ordering or
recommending purchase or rental of healthcare items and services. The federal
anti-kickback statute provides both civil and criminal penalties for, among
other things, offering or paying any remuneration to induce someone to refer
patients to, or to purchase, lease, or order (or arrange for or recommend the
purchase, lease, or order of), any item or service for which payment may be made
by Medicare or certain federally-funded state healthcare programs (e.g.,
Medicaid). This statute also prohibits soliciting or receiving any remuneration
in exchange for engaging in any of these activities. The prohibition applies
whether the remuneration is provided directly or indirectly, overtly or
covertly, in cash or in kind. Violations of the law can result in numerous
sanctions, including criminal fines, imprisonment, and exclusion from
participation in the Medicare and Medicaid programs.
 
     Several states also have referral, fee splitting and other similar laws
that may restrict the payment or receipt of remuneration in connection with the
purchase or rental of medical equipment and supplies. State laws vary in scope
and have been infrequently interpreted by courts and regulatory agencies, but
may apply to all healthcare items or services, regardless of whether Medicare or
Medicaid funds are involved.
 
     The failure of the Company or its clients to comply with, or any change in,
the applicable regulatory requirements or professional organization or industry
guidelines could, among other things, limit or prohibit the Company or its
clients from conducting certain business activities, subject the Company or its
clients to adverse publicity, increase the costs of regulatory compliance or
subject the Company or its clients to monetary fines or other penalties. Any
such actions could have a material adverse affect on the Company.
 
LIABILITY AND INSURANCE
 
     Liability Insurance.  Participants in the healthcare industry are subject
to lawsuits alleging malpractice, product liability and other legal theories,
many of which can involve large claims and significant legal costs. As a
provider of product detailing services to the pharmaceutical industry, the
Company is subject to the risk of being named as a party in such lawsuits. As a
result of its contract sales services, the Company believes that it may become
involved in litigation regarding the products distributed by its personnel, with
the attendant risks of significant legal costs, substantial damage awards and
adverse publicity. Even if such claims ultimately prove to be without merit,
defending against them can result in adverse publicity, diversion of
management's time and attention and substantial expenses, which could have a
material adverse effect on the Company.
 
     The Company maintains general liability insurance, which it believes to be
adequate in amount and coverage for the current size and scope of its operations
although there can be no assurance of that fact. However, the policies
maintained by the Company do not insure it against the errors and omissions of
its employees. The Company may seek increased insurance coverage as well as
insurance for the errors and omissions of its employees in connection with
expanding its service offerings, although the Company has not experienced
difficulty in obtaining insurance coverage in the past, there can be no
assurance that the Company will obtain increased or additional insurance
coverage on acceptable terms or at all. In addition, although the Company's
clients may indemnify the Company for the client's negligent conduct, such
indemnification may not be adequate in light of all of the potential litigation
risks facing the Company. In addition, the Company is often required to
indemnify its clients in the event of the Company's negligence. The Company,
therefore, could be held responsible for losses incurred in connection with the
performance of its services or otherwise and could incur substantial costs in
connection with legal proceedings associated with the performance of its
services or the pharmaceutical products with respect to which it provides
services.
 
     Employment Practice Liability Insurance.  Because the nature of the
Company's business is heavily dependent on its sales force, the Company has
obtained employment practice liability insurance, which insures the Company
against claims made by employees or former employees relating to their
employment, i.e., wrongful termination, sexual harassment, etc. To date, the
Company has not made any claims under this policy. There can be no assurance,
however, that the coverage maintained by the Company will be sufficient to cover
all future claims or will continue to be available in adequate amounts or at a
reasonable cost.
 
                                       35
LEGAL PROCEEDINGS
 
     From time to time the Company is involved in litigation incidental to its
business. The Company is not currently a party to any pending litigation which,
if decided adversely to the Company, would have a material adverse effect on the
business, financial condition or results of operations of the Company and the
Company is not aware of any material threatened litigation.
 
FACILITIES AND EMPLOYEES
 
     The Company's corporate headquarters are currently located in Mahwah, New
Jersey, in approximately 11,000 square feet of space occupied under a lease
which expires on April 29, 1998. The Company has entered into a new lease for
approximately 27,000 square feet in Upper Saddle River, New Jersey. The new
lease is to take effect on May 1, 1998 and is for a term of 66 months with an
option to extend for an additional five years. In addition, the Company has a
right of first offer with respect to additional space as it becomes available.
Total base rent payable during the term of the new lease is approximately $3.0
million. Additional rent is payable with respect to increases in certain
operating costs over base year amounts.
 
     As of December 31, 1997, the Company had approximately 1,165 employees. The
Company has approximately 70 people working at its headquarters in Mahwah, New
Jersey, 995 sales representatives, and 100 field sales managers. The Company is
not party to a collective bargaining agreement with a labor union and considers
its relations with its employees to be good.
 
                                       36
MANAGEMENT
 
DIRECTORS AND EXECUTIVE OFFICERS
 
     The following table sets forth the names, ages and principal position, of
the Directors, Director Nominees, executive officers and key employees of the
Company:
NAME                                   AGE                                 POSITION
------------------------------------   ---   ---------------------------------------------------------------------
John P. Dugan(1)(2).................   62    Chairman of the Board of Directors and Director of Strategic Planning
Charles T. Saldarini................   34    President, Chief Executive Officer and Director
Bernard C. Boyle....................   53    Chief Financial Officer, Executive Vice President, Secretary and
                                             Treasurer
Steven K. Budd......................   41    Chief Operating Officer and Executive Vice President
Robert Wynne........................   47    Vice President -- Account Sales
Cherie Aldana.......................   50    Vice President -- Human Resources
John M. Pietruski ( )...............   64    Director Nominee
Jan Martens Vecsi( )................   53    Director Nominee
Gerald J. Mossinghoff( )............   62    Director Nominee
------------------
(1) Member of Audit Committee
 
(2) Member of Compensation Committee
 
     John P. Dugan is the founder and Chairman of the Board of Directors of the
Company and Director of Strategic Planning. He served as its President from
inception until January 1995 and as its Chief Executive Officer from inception
until November 1997. In 1972, Mr. Dugan founded Dugan Communications, a medical
advertising agency that later became known as Dugan Farley Communications
Associates Inc. ('DFC') and served as its President until 1990. In 1990 Mr.
Dugan acquired sole control of the Company, which was then a wholly-owned
subsidiary of DFC. Mr. Dugan was a founder and served as the President of the
Medical Advertising Agency Association from 1983 to 1984. Mr. Dugan also served
on the Board of Directors of the Pharmaceutical Advertising Council (now known
as the Healthcare Marketing Communications Council, Inc.) and was its President
from 1985 to 1986. Mr. Dugan received an M.B.A. from Boston University in 1964.
 
     Charles T. Saldarini is the President and Chief Executive Officer of the
Company and a Director. Mr. Saldarini became President in January 1995 and Chief
Executive Officer in November 1997. Prior to January 1995 Mr. Saldarini was
Chief Operating Officer of the Company. Mr. Saldarini joined the Company in 1987
as a sales manager. Mr. Saldarini received an A.B. in political science from
Syracuse University in 1985.
 
     Bernard C. Boyle has served as the Company's Executive Vice President and
Chief Financial Officer since March 1997 when he joined the Company. In 1990,
Mr. Boyle founded BCB Awareness, Inc., a firm that provided management advisory
services to the Company, among others, and served as its President until March
1997. During that period he was also a partner in Boyle & Palazzolo, Partners,
an accounting firm that also provided services to the Company. From 1982 through
1990 he served as Controller and then Chief Financial Officer and Treasurer of
William Douglas McAdams, Inc., an advertising agency. From 1966 through 1971,
Mr. Boyle was employed by the national accounting firm of Coopers & Lybrand
L.L.P. as supervisor/senior audit staff. Mr. Boyle received a B.B.A. in
Accounting from Manhattan College in 1965 and an M.B.A. in Corporate Finance
from New York University in 1972.
 
     Steven K. Budd served the Company as a consultant from December 1995 to
April 1996 when he joined as Vice President -- Account Group Sales. He became
Executive Vice-President in July 1997 and Chief Operating Officer in January
1998. Prior to joining the Company, from April through December 1995, Mr. Budd
was an independent consultant. From January 1994 through April 1995, Mr. Budd
was employed by Innovex, Inc., a competing CSO, as a Director of New Business
Development. From 1989 through December 1993, Mr. Budd was employed by
Professional Detailing Network ('PDN'), a competing CSO, as a Vice President
with responsibility for building sales teams and developing marketing
strategies. Mr. Budd received a B.A. in History and Education from Susquehanna
University in 1978.
 
                                       37
Robert Wynne joined the Company in August 1990 as a Regional Sales Manager
based in Chicago, Illinois. He currently serves as Vice President -- Account
Sales, a position he has held since December 1994. From 1984 through 1990, Mr.
Wynne was employed by Carnation Nutritional Products Co. and the McNeil Consumer
Products Company, Professional Division, an affiliate of Johnson & Johnson, as a
sales representative and trainer. Mr. Wynne received a B.S. in Secondary
Education from the University of Minnesota in 1972 and an M.S. in Management of
Human Resources from National College of Education in 1985.
 
     Cherie Aldana joined the Company in 1988. Initially, she was employed as
Accounting Manager responsible for financial, payroll, benefits and personnel.
In 1990 she was promoted to Director of Human Resources and in January 1996 to
Vice President -- Human Resources. Ms. Aldana received a B.S. in Accounting from
York College in 1972 and has received certification as a Professional of Human
Resources from the Human Resources Certification Institute, a division of the
Society of Human Resource Management.
 
     Gerald J. Mossinghoff has been nominated to become a director of the
Company immediately upon consummation of this Offering. Mr. Mossinghoff is a
former Assistant Secretary of Commerce and Commissioner of Patents and
Trademarks of the Department of Commerce (1981 to 1985) and served as President
of Pharmaceutical Research and Manufacturers of America from 1985 to 1996. Since
1997 he has been Senior Counsel to the law firm of Oblon, Spivak, McClelland,
Maier and Newstadt of Arlington, Virginia. Mr. Mossinghoff has been a visiting
professor of Intellectual Property Law at the George Washington University Law
School since 1997 and Adjunct Professor of Law at George Mason University School
of Law since 1997. Mr. Mossinghoff served as United States Ambassador to the
Diplomatic Conference on the Revision of the Paris Convention from 1982 to 1985
and as Chairman of the General Assembly of the United Nations World Intellectual
Property Organization from 1983 to 1985. He is also a former Deputy General
Counsel of the National Aeronautics and Space Administration (1976 to 1981). Mr.
Mossinghoff received an Electrical Engineering degree from St. Louis University
in 1957 and a Juris Doctor degree with Honors from the George Washington
University Law School in 1961. He is a member of the Order of the Coif and is a
Fellow in the National Academy of Public Administration. He is the recipient of
many honors, including NASA's Distinguished Service Medal and the Secretary of
Commerce Award for Distinguished Public Service.
 
     John M. Pietruski has been nominated to become a director of the Company
immediately upon consummation of this Offering. Since 1990 Mr. Pietruski has
been the Chairman of the Board of Texas Biotechnology Corp., a pharmaceutical
research and development company. He is a retired Chairman of the Board and
Chief Executive Officer of Sterling Drug Inc. With Sterling Drug Inc. from 1977
to his retirement in 1988, he also held the positions of Executive Vice
President, President and Chief Operating Officer. Mr. Pietruski is a member of
the Boards of Directors of Hershey Foods Corporation, GPU, Inc., Lincoln
National Corporation and McKesson Corporation. Mr. Pietruski graduated Phi Beta
Kappa with a B.S. in Business Administration with honors from Rutgers University
in 1954 and currently serves as a regent of Concordia College.
 
     Jan Martens Vecsi has been nominated to become a director of the Company
immediately upon consummation of this Offering. Ms. Vecsi is the sister-in-law
of John P. Dugan, the Chairman of the Board of the Company. Ms. Vecsi was
employed by Citibank, N.A. from 1967 through 1996 when she retired. Starting in
1986 she served as the Senior Human Resources Officer and Vice President of the
Citibank Private Bank. Ms. Vecsi received a B.A. in Psychology and Elementary
Education from Immaculata College in 1965.
 
     The Board of Directors of the Company is divided into three classes as
nearly equal in number as possible. Each year the shareholders will elect the
members of one of the three classes to a three-year term of office. Ms. Vecsi
serves in the class whose term expires in 1999; Messrs. Saldarini and Pietruski
serve in the class whose term expires in 2000; and Messrs. Dugan and Mossinghoff
serve in the class whose term expires in 2001.
 
     The Board of Directors has an Audit Committee and a Compensation Committee.
The Audit Committee reviews the scope and results of the audit and other
services provided by the Company's independent accountants and internal controls
of the Company. The Compensation Committee is responsible for the approval of
compensation arrangements for officers of the Company and the review of the
Company's compensation plans and policies.
 
                                       38
EXECUTIVE COMPENSATION
 
     Summary Compensation. The following table presents certain information
concerning compensation paid or accrued for services rendered to the Company in
all capacities during the year ended December 31, 1997, for the Chief Executive
Officer and the other four executive officers of the Company whose aggregate
annual base salary and bonus for 1997 exceeded $100,000 (collectively, the
'Named Executive Officers').
LONG-TERM
                                                                                         COMPENSATION
                                                                                         ------------
                                                         ANNUAL COMPENSATION              SHARES OF
                                                 ------------------------------------       COMMON
                                                                            OTHER           STOCK
                                                                            ANNUAL        UNDERLYING      ALL OTHER
         NAME AND PRINCIPAL POSITION              SALARY      BONUS      COMPENSATION      OPTIONS       COMPENSATION
----------------------------------------------   --------    --------    ------------    ------------    ------------
John P. Dugan
  Chairman of the Board and Former Chief
  Executive Officer(1)........................   $125,000          --      $ 26,441          --           $2,243,000(1)
Charles T. Saldarini
  President and Chief Executive Officer.......   $120,000    $237,000(2)   $  9,724          --           $4,050,000(3)
Steven K. Budd
  Chief Operating Officer and
  Executive Vice President....................   $112,613    $ 48,000      $  8,396                          --
Bernard C. Boyle
  Chief Financial Officer,
  Executive Vice President,
  Secretary and Treasurer.....................   $105,000(4) $ 18,000      $  1,155                          --
Robert Wynne
  Vice President--Account Sales...............   $102,000    $ 18,000      $  1,155          --              --
------------------
(1) Mr. Dugan was the Chief Executive Officer of the Company until November
    1997. All other compensation represents the bonus payment to Mr. Dugan as
    the majority shareholder of the Company. Such compensation was based on the
    Company's estimated profitability and working capital requirements. As the
    Company will no longer qualify as an S Corporation after the Offering, it is
    not expected that Mr. Dugan will receive bonus payments after the Offering
    in future periods.
(2) Reflects a bonus paid to Mr. Saldarini, President and Chief Executive
    Officer and a minority shareholder of the Company. In addition to the final
    distribution in connection with the termination of the Company's S
    Corporation status, in the future Mr. Saldarini, as President and Chief
    Executive Officer, may receive cash bonuses as determined by the
    Compensation Committee.
(3) Represents the value of Common Stock issued to Mr. Saldarini in January 1997
    as reported by the Company for financial accounting purposes.
(4) Mr. Boyle joined the Company in March 1997. $15,000 of his salary represents
    amounts paid to Mr. Boyle's consulting company prior to the commencement of
    his employment.
 
     Option Grants. The following table sets forth certain information regarding
options granted by the Company to the Named Executive Officers during 1997.
 
                       OPTION GRANTS IN LAST FISCAL YEAR
INDIVIDUAL GRANTS
                                           --------------------------------------------------------        POTENTIAL
                                                            PERCENT OF                                  REALIZABLE VALUE
                                                              TOTAL                                    AT ASSUMED ANNUAL
                                             NUMBER OF       OPTIONS                                     RATES OF STOCK
                                              SHARES        GRANTED TO                                 PRICE APPRECIATION
                                            UNDERLYING      EMPLOYEES      EXERCISE                     FOR OPTION TERM
                                              OPTIONS       IN FISCAL        PRICE       EXPIRATION    ------------------
                  NAME                      GRANTED (#)        YEAR        ($/SHARE)        DATE       5% ($)     10% ($)
----------------------------------------   -------------    ----------    -----------    ----------    -------    -------
John P. Dugan...........................       --             --             --             --           --         --
Charles T. Saldarini....................       --             --             --             --           --         --
Steven K. Budd..........................                       58.3%        $             12/31/05     $          $
Bernard C. Boyle........................                       41.7%        $             12/31/05     $          $
Robert Wynne............................       --             --             --             --           --         --
39
Option Exercises and Year-End Option Values. The following table provides
information with respect to options exercised by the Named Executive Officers
during 1997 and the number and value of unexercised options held by the Named
Executive Officers as of December 31, 1997.
 
   AGGREGATED OPTION EXERCISE IN LAST FISCAL YEAR AND YEAR-END OPTION VALUES
NUMBER OF SHARES UNDERLYING      VALUE OF UNEXERCISED IN-THE-
                                                                  UNEXERCISED OPTIONS AT FISCAL       MONEY OPTIONS AT FISCAL
                                                                          YEAR-END (#)                    YEAR-END ($)(1)
                            SHARES ACQUIRED   VALUE REALIZED    ---------------------------------   ----------------------------
NAME                        ON EXERCISE (#)       ($)(1)          EXERCISABLE      UNEXERCISABLE    EXERCISABLE    UNEXERCISABLE
--------------------------  ---------------   ---------------   ---------------   ---------------   -----------    -------------
John P. Dugan.............      --                --                --                --               --              --
Charles T. Saldarini......      --                --                --                --               --              --
Steven K. Budd............      --                --
Bernard C. Boyle..........      --                --
Robert Wynne..............      --                --                --                --               --              --
------------------------
(1) For the purposes of this calculation, value is based upon the difference
    between the exercise price and $_____ per share, the fair market value of
    the Common Stock as determined by the Board of Directors.
 
EMPLOYMENT CONTRACTS
 
     In January 1998, the Company entered into an employment agreement with John
P. Dugan providing for his employment as Chairman of the Board and Director of
Strategic Planning. The Agreement provides for an annual salary of $125,000 and
no cash bonuses and for participation in all executive benefit plans.
 
     In _________ 199__, the Company entered into an employment agreement with
Charles T. Saldarini providing for his employment, effective upon the closing of
this Offering, as President and Chief Executive Officer for a term expiring on
___________ _____, 200_. The Agreement provides for an annual base salary of
$_________ and for participation in all executive benefit plans. The agreement
also provides, among other things, that, if his employment is terminated without
cause (as defined in the agreement), the Company will pay him an amount equal to
the salary which would have been payable to him over the unexpired term of his
employment agreement.
 
     The Company has also entered into employment agreements with each of
Messrs. Boyle and Budd, providing for their respective employment, effective
upon the closing of this Offering, as Chief Financial Officer and Chief
Operating Officer, for terms expiring on ______ __, 200_. The agreements provide
for an annual base salary of $_____ for Mr. Boyle and $__________ for Mr. Budd
and for their participation in all executive benefit plans. Each agreement also
provides, among other things, that, if employment is terminated by the Company
without cause (as defined), the Company will pay the employee an amount equal to
the salary which would have been payable over the unexpired term of the
employment agreement.
 
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION IN COMPENSATION
DECISIONS
 
     Prior to this Offering, the Company has had no separate Compensation
Committee or other committee performing equivalent functions. As a result,
compensation matters were performed by the Board of Directors or senior
management. None of the Directors expected to serve on the Compensation
Committee is an employee of the Company, and neither the Chief Executive Officer
nor any other executive officer will serve on the Compensation Committee. No
Director or executive officer of the company is a Director or executive officer
of any other corporation that has a director or executive officer who is also a
Director of the Company.
 
1998 STOCK OPTION PLAN
 
     In __________, 1998, in order to attract and retain persons necessary for
the success of the Company, the Company adopted its 1998 Stock Option Plan (the
'Plan') covering up to __________ of its Common Shares, pursuant to which
officers, directors and key employees of the Company and consultants to the
Company are eligible to receive incentive and/or non-qualified stock options.
The Plan, which expires in October 2008, will be administered by the Board of
Directors or a committee designated by the Board of Directors. The selection of
participants, allotment of shares, determination of price and other conditions
relating to the purchase of options will be determined by the Board of
Directors, or a committee thereof, in its sole discretion. Incentive stock
options granted under the Plan are exercisable for a period of up to 10 years
from the date of grant at an exercise price which is not less than the fair
market value of the Common Stock on the date of the grant, except that the term
of an incentive stock option granted under the Plan to a shareholder owning more
than 10% of the
 
                                       40
outstanding Common Stock may not exceed five years and its exercise price may
not be less than 110% of the fair market value of the Common Stock on the date
of the grant. At February 1, 1998 options for an aggregate of ________ shares,
exercisable at a price of $______ per share during a ten-year period had been
granted to Bernard C. Boyle and Steven K. Budd, and were outstanding under the
Plan. These options are exercisable for one-third of the shares covered thereby
as of the earlier of June 30, 1998 or the completion of this Offering and for an
additional one-third of the shares covered thereby each year thereafter. No
other options have been granted or exercised under the Plan. However,
immediately after the consummation of the Offering, the Company intends to grant
approximately __________ incentive stock options to approximately __________
employees. Such options will, generally, vest over three years and will be
exercisable at the public offering price. Options for ________ shares will be
granted to each of the Company's three outside directors upon their taking
office immediately following the closing of the Offering.
 
COMPENSATION OF DIRECTORS
 
     Each non-employee member of the Board of Directors will receive an annual
director's fee of $_____ plus $______ for each meeting attended and
reimbursement for travel costs and other out-of-pocket expenses incurred in
attending each Directors' meeting. In addition, committee members will receive
$__________ for each committee meeting attended. Additionally, pursuant to the
1998 Stock Option Plan each non-employee Director upon election to the Board
will receive options to purchase _____ shares of Common Stock exercisable at the
fair market value on the date of grant and additionally will receive automatic
grants of options to purchase ______ shares of Common Stock at the beginning of
each calendar year. See '-- 1998 Stock Option Plan.'
 
401(K) PLAN
 
     The Company maintains a retirement plan (the '401(k) Plan') intended to
qualify under Sections 401(a) and 401(k) of the Code. The 401(k) Plan is a
defined contribution plan that covers employees of the Company at least 21 years
of age, who have been employed by the Company for at least one year. Employees
may contribute up to 15% of their annual wages (subject to an annual limit
prescribed by the Code) as pre-tax salary deferral contributions. Effective
January 1, 1997, the Company committed to make mandatory contributions to the
401(k) Plan to match employee contributions up to a maximum of 2% of each
participating employee's annual wages. The Company's contribution to the 401(k)
Plan for 1997 was approximately $172,000.
 
LIMITATION OF DIRECTORS' LIABILITY AND INDEMNIFICATION
 
     The DGCL authorizes corporations to limit or eliminate the personal
liability of directors to corporations and their shareholders for monetary
damages for breach of directors' fiduciary duty of care. The Company's
Certificate of Incorporation limits the liability of directors of the Company to
the Company or its shareholders to the fullest extent permitted by Delaware law.
See 'Description of Capital Stock -- Certain Provisions of the Company's
Certificate of Incorporation and Bylaws.'
 
     The Company's Certificate of Incorporation provides mandatory
indemnification rights to any officer or Director of the Company who, by reason
of the fact that he or she is an officer or Director of the Company, is involved
in a legal proceeding of any nature. Such indemnification rights include
reimbursement for expenses incurred by such officer or Director in advance of
the final disposition of such proceeding in accordance with the applicable
provisions of the DGCL. Insofar as indemnification for liabilities under the
Securities Act may be provided to officers and Directors or persons controlling
the Company, the Company has been informed that in the opinion of the Securities
and Exchange Commission (the 'Commission'), such indemnification is against
public policy as expressed in the Securities Act and is, therefore,
unenforceable.
 
     There is no pending litigation or proceeding involving a Director, officer,
employee or agent of the Company in which indemnification by the Company will be
required or permitted. The Company is not aware of any threatened litigation or
proceeding that may result in a claim for such indemnification.
 
                                       41
CERTAIN TRANSACTIONS
 
     During 1997, Boomer & Son, Inc. ('B&S'), a corporation which prior to 1998
was wholly-owned by John P. Dugan, the Company's Chairman of the Board, provided
advertisement production and placement services to the Company. Mr. Dugan is not
actively involved in B&S's business. The Company purchased advertising in the
amount of $1.6 million through B&S at stated advertising rates set by the
periodicals and publications in which advertisements were placed. B&S received a
commission from the publications for its placement services. In addition, in
1997 B&S repaid approximately $196,000 of advances made to it by the Company in
1996. At December 31, 1997 the net amount due from B&S was approximately
$27,000. See note 8 to the Company's Financial Statements. The Company
anticipates that this amount will be repaid prior to the Offering.
 
     At the end of 1997 Mr. Dugan transferred his interest in B&S to his son and
daughter-in-law. The Company and B&S propose to enter into an agreement pursuant
to which B&S will continue to place advertising on behalf of the Company with
various media. As of February 1, 1998 the total amount of advertising placed by
B&S on behalf of the Company in 1998 was approximately $180,000. The Company
believes that the amounts paid to B&S were no less favorable than would be
available in an arms-length negotiated transaction with an unaffiliated entity.
See note 8 to the Company's Financial Statements.
 
     The Company and Charles T. Saldarini entered into an employment agreement
as of January 1, 1997, which provided for, among other things, an outright grant
of shares of Common Stock to Mr. Saldarini. As a result of such grant, Mr.
Saldarini owns 15.0% of the outstanding shares of Common Stock immediately prior
to the Offering. In connection with such grant, the Company incurred a non-cash,
non-recurring expense of $4.5 million for financial reporting purposes.
 
     The Company has been subject to taxation under Subchapter S of the Code
since January 1, 1991 and under the corresponding provisions of the tax laws of
the State of New Jersey since January 1, 1994. As a result, the net income of
the Company, for Federal and New Jersey state income tax purposes, has been
reported by and taxable directly to the Company's shareholders rather than to
the Company. In 1996, the Company paid approximately $1.5 million to Mr. Dugan,
its Chief Executive Officer and sole shareholder as bonus compensation. In 1997,
the Company paid an aggregate of approximately $2.48 million of bonus
compensation to its shareholder-employees, Mr. Dugan and Charles T. Saldarini,
its President. The Company's S Corporation tax status will terminate upon the
consummation of this Offering. Immediately prior to this Offering, the Company
will make a final distribution (consisting of an aggregate of approximately
$______ million in cash payments) to its shareholders. This payment represents
the shareholders' equity in the Company prior to the conversion date.
 
                                       42
PRINCIPAL SHAREHOLDERS
 
     The following table sets forth certain information known to the Company
regarding the beneficial ownership of Common Stock as of December 31, 1997 and
as adjusted to reflect the sale of the shares offered hereby, by (i) each person
known to the Company to be the beneficial owner of more than 5% of its
outstanding shares of Common Stock, (ii) each Director and Director Nominee of
the Company, (iii) each Named Executive Officer and (iv) all Directors, Director
Nominees and Named Executive Officers of the Company as a group. Except as
otherwise indicated, the persons or entities listed below have sole voting and
investment power with respect to all shares of Common Stock owned by them.
PERCENTAGE OF SHARES
                                                                                              BENEFICIALLY OWNED(2)
                                                                 NUMBER OF SHARES       ---------------------------------
NAME AND ADDRESS(1)                                            BENEFICIALLY OWNED(2)    BEFORE OFFERING    AFTER OFFERING
------------------------------------------------------------   ---------------------    ---------------    --------------
John P. Dugan...............................................                                   85.0%
Charles T. Saldarini........................................                                   15.0%
Steven K. Budd..............................................                (3)                 *               *
Bernard C. Boyle............................................                (4)                 *               *
John M. Pietruski...........................................                (5)                   --            *
Jan Martens Vecsi...........................................                (5)                   --            *
Gerald J. Mossinghoff.......................................                (5)                   --            *
All Officers, Directors and Director Nominees as a group (9
  persons)..................................................                (6)               100.0%
                                                               ---------------------    ---------------    --------------
------------------
*     Less than 1%.
(1)   The addresses of Messrs. Dugan and Saldarini are c/o the Company, 599 MacArthur Boulevard, Mahwah, New Jersey
      07430-2326.
(2)   Pursuant to the rules of the Commission, shares of the Company's Common Stock that a person has the right to
      acquire within 60 days of the date hereof pursuant to the exercise of stock options are deemed to be
      outstanding for the purpose of computing the percentage ownership of such person but are not deemed
      outstanding for the purpose of computing the percentage ownership of any other person.
(3)   Represents ____ shares issuable pursuant to options exercisable within 60 days of the date hereof.
(4)   Represents ____ shares issuable pursuant to options exercisable within 60 days of the date hereof.
(5)   Represents ____ shares issuable pursuant to options exercisable within 60 days of the date hereof.
(6)   Includes ____ shares issuable pursuant to options exercisable within 60 days of the date hereof.
All of the shares of Common Stock set forth in the above table are subject
to agreements prohibiting the sale, assignment or transfer for 180 days from the
date of this Prospectus without the prior written consent of Morgan Stanley &
Co. Incorporated. See 'Underwriting.'
 
                                       43
DESCRIPTION OF CAPITAL STOCK
 
     The Company's authorized capital stock consists of 30,000,000 shares of
Common Stock, par value of $.01 per share ('Common Stock'), and 5,000,000 shares
of Preferred Stock, par value of $.01 per share ('Preferred Stock'). Upon
completion of the Offering, there will be ________ shares of Common Stock
outstanding and no shares of Preferred Stock outstanding. As of December 31,
1997, there were outstanding ________ shares of Common Stock held of record by
two stockholders. In addition, at December 31, 1997, there were outstanding
options to purchase ______ shares of Common Stock.
 
COMMON STOCK
 
     The holders of Common Stock are entitled to one vote for each share held of
record on all matters submitted to a vote of stockholders. Subject to the
preferences that may be applicable to any outstanding Preferred Stock, the
holders of Common Stock are entitled to receive dividends as and when declared
by the Board of Directors out of funds legally available for dividends, and, in
the event of liquidation, dissolution or winding up of the Company, to share
ratably in all assets remaining after the payment of liabilities. The Common
Stock has no preemptive, conversion or other subscription rights. All
outstanding shares of Common Stock are fully paid and nonassessable.
 
PREFERRED STOCK
 
     The Board of Directors is authorized to issue the undesignated Preferred
Stock in one or more series, to determine the powers, preferences and rights,
and the qualifications, limitations or restrictions, granted to or imposed upon
any wholly unissued series of undesignated Preferred Stock, and to fix the
number of shares constituting any series and the designation of such series,
without any further vote or action by the shareholders. The issuance of
Preferred Stock may have the effect of delaying, deferring or preventing a
change in control of the Company and may adversely affect the voting and other
rights of the holders of Common Stock.
 
CERTAIN PROVISIONS OF THE COMPANY'S CERTIFICATE OF INCORPORATION AND BYLAWS
 
     The Company's Certificate of Incorporation limits the liability of
directors of the Company to the fullest extent permitted under Section 102(b)(7)
of the DGCL. To this end, no director of the Company will be liable to the
Company or to its shareholders for monetary damages for breach of fiduciary duty
as a director, except for liability for (i) any breach of the director's duty of
loyalty to the Company or its shareholders, (ii) acts or omissions not in good
faith or which involve intentional misconduct or a knowing violation of the law,
(iii) any willful or negligent payment of an unlawful dividend, stock purchase,
or redemption or (iv) any transaction from which the director derived an
improper personal benefit.
 
     The Certificate of Incorporation provides that the Board of Directors
consist of three classes of directors serving for staggered three-year terms. As
a result, one-third of the Company's Board of Directors will be elected each
year. In accordance with the DGCL, directors serving on classified boards of
directors may only be removed from office for cause. The Certificate of
Incorporation provides that shareholders may take such action only by the
affirmative vote of at least 66 2/3% of the voting stock outstanding.
 
     The Company's Bylaws provide that only the Board of Directors may call a
special meeting of shareholders and that shareholders must follow an advance
notification procedure for certain shareholder nominations of candidates and for
certain other shareholder business to be conducted at the annual meeting. These
provisions could, under certain circumstances, operate to delay, defer or
prevent a change in control of the Company.
 
     These provisions could delay or frustrate the removal of incumbent
directors or a change in control of the Company. The provisions also could
discourage, impede or prevent a merger, tender offer or proxy contest, even if
such event would be favorable to the interests of shareholders.
 
SECTION 203 OF THE DGCL
 
     As a corporation organized under the laws of the State of Delaware, the
Company is subject to Section 203 of the DGCL which restricts certain business
combinations between the Company and an 'interested stockholder' (in general, a
shareholder owning 15% or more of the Company's outstanding voting stock) or its
 
                                       44
affiliates or associates for a period of three years following the date on which
the shareholder becomes an 'interested stockholder.' The restrictions do not
apply if (i) the corporation has elected in its certificate of incorporation not
to be governed by the Delaware anti-takeover law (the Company has not made such
an election), (ii) prior to a person qualifying as an 'interested stockholder,'
the Board of Directors approves either the business combination or the
transaction which would cause such individual to become an 'interested
stockholder,' (iii) upon consummation of the transaction in which any person
becomes an 'interested stockholder,' such person owns at least 85% of the voting
stock of the Company outstanding at the time the transaction commences
(excluding shares owned by certain employee stock ownership plans and persons
who are both directors and officers of the Company) or (iv) on or subsequent to
the date on which a person becomes an 'interested stockholder,' the business
combination is both approved by the Board of Directors and authorized at an
annual or special meeting of the Company's shareholders, without written
consent, by the affirmative vote of at least 66 2/3% of the outstanding voting
stock not owned by the 'interested stockholder.'
 
TRANSFER AGENT AND REGISTRAR
 
     The Transfer Agent and Registrar for the Company's Common Stock is American
Stock Transfer & Trust Company.
 
                                       45
SHARES ELIGIBLE FOR FUTURE SALE
 
     Prior to the offering there has been no market for the Common Stock of the
Company. The Company can make no prediction as to the effect, if any, that sales
of shares or the availability of shares for sale will have on the market price
prevailing from time to time. Nevertheless, sales of significant amounts of the
Common Stock in the public market, or the perception that such sales may occur,
could adversely affect prevailing market prices. See 'Risk Factors -- Shares
Eligible for Future Sale.'
 
     Upon completion of the Offering, the Company will have __________ shares of
Common Stock outstanding (excluding _________ shares reserved for issuance upon
the exercise of outstanding stock options) (________ shares of Common Stock
outstanding if the Underwriters' over-allotment option is exercised in full). Of
these shares, the _________ shares offered hereby will be freely tradable
without restrictions or further registration under the Securities Act, except
for any shares purchased by 'affiliates' of the Company, as that term is defined
in Rule 144 under the Securities Act ('Affiliates'), which will be subject to
the resale limitations imposed by Rule 144, as described below. The remaining
__________ shares of Common Stock held by existing shareholders are 'restricted
securities' within the meaning of Rule 144 and may not be resold in the absence
of registration under the Securities Act or pursuant to exemptions from such
registration including, among others, the exemption provided by Rule 144 under
the Securities Act ('Restricted Shares'). Restricted Shares may be sold in the
public market only if registered or if they qualify for an exemption from
registration under Rule 144 or 701 promulgated under the Securities Act, which
rules are summarized below. All officers, directors, shareholders and option
holders of the Company have agreed not to offer, pledge, sell, contract to sell,
sell any option or contract to purchase, purchase any option or contract to
sell, grant any option, right or warrant to purchase, or otherwise transfer or
dispose of, directly or indirectly (or enter into any swap or other arrangement
that transfers to another, in whole or in part, any of the economic consequences
of ownership of), any shares of Common Stock or any securities convertible into
or exercisable or exchangeable for shares of Common Stock, for a period of 180
days after the date of this Prospectus, without the prior written consent of
Morgan Stanley & Co. Incorporated. Morgan Stanley & Co. Incorporated may in its
sole discretion choose to release a certain number of these shares from such
restrictions prior to the expiration of such 180 day period. As a result of such
contractual restrictions and the provisions of Rule 144 and 701, the Restricted
Shares will be available for sale in the public market as follows: (i) no such
shares will be eligible for immediate sale on the date of this Prospectus; and
(ii) all of such shares will be eligible for sale upon expiration of the lock-up
agreements 180 days after the date of this Prospectus, subject to the volume
limitations and other conditions of Rule 144 described below.
 
     In general, under Rule 144 as currently in effect, beginning 90 days after
the date of this Prospectus, a person (or persons whose shares are required to
be aggregated) whose restricted securities have been outstanding for at least
one year, including a person who may be deemed an 'affiliate' of the Company,
may only sell a number of shares within any three-month period which does not
exceed the greater of (i) one percent of the then outstanding shares of the
Company's Common Stock (approximately ________ shares after the Offering,
_________ if the over-allotment option is exercised in full) or (ii) the average
weekly trading volume in the Company's Common Stock in the four calendar weeks
immediately preceding such sale. Sales under Rule 144 are also subject to
certain requirements as to the manner of sale, notice and the availability of
current public information about the Company. A person who is not an affiliate
of the issuer, has not been an affiliate within three months prior to the sale
and has owned the restricted securities for at least two years is entitled to
sell such shares under Rule 144(k) without regard to any of the limitations
described above.
 
     Beginning 90 days after the date of this Prospectus, certain shares issued
or issuable upon the exercise of options granted by the Company prior to the
date of this Prospectus will also be eligible for sale in the public market
pursuant to Rule 701 under the Act. In general, Rule 701 permits resales of
shares issued pursuant to certain compensatory benefit plans and contracts
commencing 90 days after the issuer becomes subject to the reporting
requirements of the Securities Exchange Act of 1934, as amended, in reliance
upon Rule 144, but without compliance with certain restrictions of Rule 144,
including the holding period requirements. As of December 31, 1997, the Company
has granted options covering _______ shares of Common Stock which have not been
exercised and which become exercisable at various times in the future. Any
shares of Common Stock issued upon the exercise of these options will be
eligible for sale pursuant to Rule 701.
 
                                       46
The Company intends to file a registration statement under the Securities
Act covering _______ shares of Common Stock reserved for issuance under the 1998
Stock Option Plan. Such registration statement is expected to be filed and
become effective as soon as practicable after the effective date of this
Offering. Accordingly, shares registered under such registration statement will,
subject to Rule 144 volume limitations applicable to Affiliates, be available
for sale in the open market unless such shares are subject to vesting
restrictions with the Company.
 
                                  UNDERWRITERS
 
     Under the terms and subject to the conditions in the Underwriting Agreement
dated the date hereof (the 'Underwriting Agreement'), the Underwriters named
below (the 'Underwriters'), for whom Morgan Stanley & Co. Incorporated, William
Blair & Company, L.L.C. and Hambrecht & Quist LLC are serving as Representatives
(the 'Representatives'), have severally agreed to purchase, and the Company has
agreed to sell to the Underwriters, severally, the respective number of shares
of Common Stock set forth opposite the names of such Underwriters below:
NUMBER
NAME                                                                                        OF SHARES
---------------------------------------------------------------------------------------     ----------
Morgan Stanley & Co. Incorporated......................................................
William Blair & Company, L.L.C.........................................................
Hambrecht & Quist LLC..................................................................
                                                                                            ----------
 
     Total.............................................................................
                                                                                            ----------
                                                                                            ----------
The Underwriting Agreement provides that the obligations of the several
Underwriters to pay for and accept delivery of the shares of Common Stock
offered hereby are subject to the approval of certain legal matters by their
counsel and to certain other conditions. The Underwriters are obligated to take
and pay for all the shares of Common Stock offered hereby (other than those
covered by the over-allotment option described below) if any such shares are
taken.
 
     The Underwriters initially propose to offer part of the shares of Common
Stock directly to the public at the public offering price set forth on the cover
page hereof and part to certain dealers at a price which represents a concession
not in excess of $  a share under the public offering price. Any Underwriter may
allow, and such dealers may reallow, a concession not in excess of $  a share to
other Underwriters or to certain other dealers. After the initial offering of
the shares of Common Stock, the offering price and other selling terms may from
time to time be varied by the Underwriters.
 
     The Company has granted the Underwriters an option, exercisable for 30 days
from the date of the Prospectus, to purchase up to _________ additional shares
of Common Stock at the public offering price set forth on the cover page hereof,
less underwriting discounts and commissions. The Underwriters may exercise such
option to purchase solely for the purpose of covering over-allotments, if any,
made in connection with the offering of the shares of Common Stock offered
hereby. To the extent such option is exercised, each Underwriter will become
obligated, subject to certain conditions, to purchase approximately the same
percentage of such additional shares as the number set forth next to such
Underwriter's name in the preceding table bears to the total number of shares of
Common Stock offered by the Underwriters hereby.
 
                                       47
See 'Shares Eligible for Future Sale' for a description of certain
arrangements by which all of the Company's executive officers and directors and
certain other existing shareholders have agreed not to sell or otherwise dispose
of Common Stock or convertible securities of the Company for up to 180 days
after the date of this Prospectus without the prior written consent of Morgan
Stanley & Co. Incorporated. The Company has agreed in the Underwriting Agreement
that it will not, directly or indirectly, without the prior written consent of
Morgan Stanley & Co. Incorporated, contract to sell, sell any option or contract
to purchase, purchase any option or contract to sell, grant any option, right or
warrant to purchase, lend or otherwise transfer or dispose of any shares of
Common Stock or any securities convertible into or exchangeable for Common
Stock, for a period of 180 days after the date of this Prospectus, except under
certain circumstances.
 
     At the request of the Company, the Underwriters have reserved for sale at
the initial public offering price up to _________ shares offered hereby for
officers, directors, employees and certain other persons associated with the
Company. The number of shares available for sale to the general public will be
reduced to the extent such persons purchase such reserved shares. Any reserved
shares not so purchased will be offered by the Underwriters to the general
public on the same basis as the other shares offered hereby.
 
     The Representatives have informed the Company that the Underwriters do not
intend to confirm sales in excess of five percent of the total number of shares
of Common Stock offered hereby to accounts over which they exercise
discretionary authority.
 
     The Company and the Underwriters have agreed to indemnify each other
against certain liabilities, including liabilities under the Securities Act.
 
     Application has been made to list the Common Stock for quotation on the
Nasdaq National Market under the symbol 'PDII.'
 
     In order to facilitate the offering of the Common Stock, the Underwriters
may engage in transactions that stabilize, maintain or otherwise affect the
price of the Common Stock. Specifically, the Underwriters may overallot in
connection with the Offering, creating a short position in the Common Stock for
their own account. In addition, to cover over-allotments or to stabilize the
price of the Common Stock, the Underwriters may bid for, and purchase, shares of
Common Stock in the open market. Finally, the underwriting syndicate may reclaim
selling concessions allowed to an underwriter or a dealer for distributing the
Common Stock in the offering, if the syndicate repurchases previously
distributed Common Stock in transactions to cover syndicate short positions, in
stabilization transactions or otherwise. Any of these activities may stabilize
or maintain the market price of the Common Stock above independent market
levels. The Underwriters are not required to engage in these activities, and may
cease any of these activities at any time.
 
PRICE OF THE OFFERING
 
     Prior to the Offering, there has been no public market for the Common
Stock. The initial public offering price for the Common Stock will be determined
by negotiations between the Company and the Representatives. Among the factors
considered in determining the initial public offering price will be the future
prospects of the Company and its industry in general; revenue, earnings and
certain other financial and operating information of the Company in recent
periods; and certain ratios, market prices of securities and certain financial
operating information of companies engaged in activities similar to those of the
Company. The estimated initial public offering price range set forth on the
cover page of this Prospectus is subject to change as a result of market
conditions or other factors.
 
                                 LEGAL MATTERS
 
     The validity of the Common Stock offered hereby will be passed upon for the
Company by Morse, Zelnick, Rose & Lander, LLP, 450 Park Avenue, New York, New
York 10022 and for the Underwriters by Ropes & Gray, One International Place,
Boston, Massachusetts 02110. Certain matters relating to rules and regulations
promulgated by the FDA and other regulatory matters will be passed upon for the
Company by Farkas & Manelli, P.L.L.C., 1233 20th Street, N.W. Suite 700,
Washington, D.C. 20036-2396.
 
                                       48
EXPERTS
 
     The balance sheets as of December 31, 1997 and 1996 and the statements of
operations, cash flows and shareholders' equity for each of the three years in
the period ended December 31, 1997 included in this Prospectus, have been
included herein in reliance on the report of Coopers & Lybrand L.L.P.,
independent accountants, given on the authority of that firm as experts in
accounting and auditing.
 
                             ADDITIONAL INFORMATION
 
     The Company has filed with the Securities and Exchange Commission (the
'Commission') a Registration Statement on Form S-1 under the Securities Act,
with respect to the Common Stock offered hereby. As permitted by the rules and
regulations of the Commission, this Prospectus, which is part of the
Registration Statement, omits certain information, exhibits, schedules and
undertakings set forth in the Registration Statement. For further information
pertaining to the Company and the Common Stock, reference is made to such
Registration Statement and the exhibits and schedules thereto. Statements
contained in this Prospectus as to the contents or provisions of any documents
referred to herein are not necessarily complete, and in each instance where a
copy of the document has been filed as an exhibit to the Registration Statement,
reference is made to the exhibit so filed. The Registration Statement may be
inspected without charge at the office of the Commission at 450 Fifth Street,
N.W., Washington, D.C. 20549. Copies of the Registration Statement may be
obtained from the Commission at prescribed rates from the Public Reference
Section of the Commission at such address, and at the Commission's regional
offices located at 7 World Trade Center, 13th Floor, New York, New York 10048,
and at Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois
60661. In addition, registration statements and certain other filings made with
the Commission through its Electronic Data Gathering, Analysis and Retrieval
('EDGAR') system are publicly available through the Commission's site on the
Internet's World Wide Web, located at http://www.sec.gov. The Registration
Statement, including all exhibits thereto and amendments thereof, has been filed
with the Commission through EDGAR.
 
                                       49
INDEX TO FINANCIAL STATEMENTS
PAGE
                                                                                                              ----
PROFESSIONAL DETAILING, INC.:
 
     Report of Independent Accountants.....................................................................    F-2
 
     Balance Sheets........................................................................................    F-3
 
     Statements of Operations..............................................................................    F-4
 
     Statements of Cash Flows..............................................................................    F-5
 
     Statements of Shareholders' Equity....................................................................    F-6
 
     Notes to Financial Statements.........................................................................    F-7
F-1
After the merger discussed in Note 2 to the Financial Statements is effected, we
will be in a position to render the following report.
 
                                          /s/ Coopers & Lybrand L.L.P.
 
Parsippany, New Jersey
February 3, 1998
 
                       REPORT OF INDEPENDENT ACCOUNTANTS
                            ------------------------
 
To the Stockholders and
Board of Directors of Professional Detailing, Inc.:
 
     We have audited the accompanying balance sheets of Professional Detailing,
Inc. as of December 31, 1997 and 1996, and the related statements of operations,
cash flows and shareholders' equity for each of the three years in the period
ended December 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 finanicial 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 Professional Detailing, Inc.
as of December 31, 1997 and 1996, and the results of their operations and their
cash flows for the three years in the period ended December 31, 1997, in
conformity with generally accepted accounting principles.
 
Parsippany, New Jersey
February 3, 1998, except as
to the information presented
in Note 2, for which the date
is                   .
 
                                      F-2
PROFESSIONAL DETAILING, INC.
                                 BALANCE SHEETS
DECEMBER 31,
                                                                        ----------------------------------------
                                                                                                     PRO FORMA
                                                                           1996          1997           1997
                                                                        ----------    -----------    -----------
                                                                                                     (UNAUDITED)
ASSETS
Current Assets:
Cash and Cash Equivalents............................................   $2,403,011    $ 5,759,918    $ 5,084,197
Contract Payments Receivable.........................................    3,037,566      2,073,356      2,073,356
Unbilled Costs and Accrued Profits on Contracts in Progress..........    2,372,518      4,986,454      4,986,454
Receivable from Affiliates, net......................................       84,327         27,161         27,161
Other Current Assets.................................................       30,000        297,032        297,032
                                                                        ----------    -----------    -----------
     Total Current Assets............................................    7,927,422     13,143,921     12,468,200
  Net Property, Plant & Equipment:...................................      395,062        547,377        547,377
                                                                        ----------    -----------    -----------
Total Assets.........................................................   $8,322,484    $13,691,298    $13,015,577
                                                                        ----------    -----------    -----------
                                                                        ----------    -----------    -----------
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts Payable.....................................................   $  608,895    $   473,832    $   473,832
Notes Payable........................................................           --         68,365         68,365
Accrued Incentives...................................................    2,905,506      2,806,839      2,806,839
Accrued Salaries and Wages...........................................      896,202      1,417,789      1,417,789
Unearned Contract Revenue............................................    3,925,853      6,131,322      6,131,322
Other Accrued Expenses...............................................      463,754      2,117,330      2,117,330
                                                                        ----------    -----------    -----------
     Total Current Liabilities.......................................    8,800,210     13,015,477     13,015,477
                                                                        ----------    -----------    -----------
Commitments and Contingencies
Shareholders' Equity:
Capital Stock, no par value;
  2,500 shares authorized; shares issued and outstanding,
  1996 -- 100; 1997 -- 100...........................................          100            100            100
Additional Paid-In Capital...........................................           --      4,193,852        101,822
Retained Deficit.....................................................     (467,486)    (3,416,309)            --
Deferred Compensation................................................           --       (101,822)      (101,822)
Shareholder Loan.....................................................      (10,340)            --             --
                                                                        ----------    -----------    -----------
     Total Shareholders' Equity......................................     (477,726)       675,821            100
                                                                        ----------    -----------    -----------
Total Liabilities & Equity...........................................   $8,322,484    $13,691,298    $13,015,577
                                                                        ----------    -----------    -----------
                                                                        ----------    -----------    -----------
The accompanying notes are an integral part of these financial statements

                                      F-3
PROFESSIONAL DETAILING, INC.

                            STATEMENTS OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31,
                                                                       -----------------------------------------
                                                                          1995           1996           1997
                                                                       -----------    -----------    -----------
Revenue.............................................................   $18,398,554    $33,014,960    $54,541,818
Less: Program Expenses, including related party amounts of $0,
  $671,810 and $1,564,606 for the periods ended December 31, 1995,
  1996 and 1997, respectively.......................................    15,427,428     26,886,445     43,057,196
                                                                       -----------    -----------    -----------
Gross Profit........................................................     2,971,126      6,128,515     11,484,622
Compensation Expense................................................     2,124,470      3,190,984      5,120,969
Bonus to Majority Shareholder.......................................       425,000      1,500,000      2,243,000
Stock Grant Expense.................................................            --             --      4,470,000
Other General, Selling & Administrative Expenses....................     1,158,475      1,650,049      2,754,522
                                                                       -----------    -----------    -----------
Total General, Selling & Administrative Expenses....................     3,707,945      6,341,033     14,588,491
                                                                       -----------    -----------    -----------
Operating Loss......................................................      (736,819)      (212,518)    (3,103,869)
Other Income, Net...................................................        69,981         98,072        155,046
                                                                       -----------    -----------    -----------
Net Loss............................................................   $  (666,838)   $  (114,446)   $(2,948,823)
                                                                       -----------    -----------    -----------
                                                                       -----------    -----------    -----------
Pro Forma Data (unaudited) (see note 3)
  Net Loss, as reported.............................................      (666,838)      (114,446)    (2,948,823)
Pro Forma Income Tax Benefit........................................       120,969             --             --
                                                                       -----------    -----------    -----------
Pro Forma Net Loss..................................................   $  (545,869)   $  (114,446)   $(2,948,823)
                                                                       -----------    -----------    -----------
                                                                       -----------    -----------    -----------
Pro Forma Net Income (Loss) Per Share...............................
                                                                                                     -----------
                                                                                                     -----------
Pro Forma Weighted Average Shares Outstanding.......................
                                                                                                     -----------
                                                                                                     -----------
The accompanying notes are an integral part of these financial statements

                                      F-4
PROFESSIONAL DETAILING, INC.

                            STATEMENTS OF CASH FLOWS
FOR THE YEAR ENDED DECEMBER 31,
                                                                         ----------------------------------------
                                                                            1995           1996          1997
                                                                         -----------    ----------    -----------
CASH FLOWS FROM OPERATING ACTIVITIES
Net Loss From Operations..............................................   $  (666,838)   $ (114,446)   $(2,948,823)
     Adjustments to reconcile net loss to net cash provided by/(used
       in) operating activities:
       Depreciation...................................................        85,040       104,531        137,852
       Non-Cash Compensation Expense -- Stock Grant to Officer........            --            --      4,050,000
       Non-Cash Compensation Expense -- Stock Options.................            --            --         42,030
     Other changes in assets and liabilities:
       (Increase) decrease in contract payments receivable............     2,779,325      (188,033)       964,210
       (Increase) decrease in unbilled costs..........................    (2,138,421)      138,271     (2,613,936)
       (Increase) decrease in other current assets....................       136,354        22,253       (267,032)
       Increase (decrease) in trade accounts payable..................       538,152        55,743       (135,063)
       Increase in accrued liabilities................................       825,228     2,522,659        422,920
       Increase (decrease) in unearned contract revenue...............    (1,721,519)     (382,536)     2,205,469
       Increase (decrease) in payable to affiliate....................            --       284,877       (138,859)
       Increase (decrease) in other current liabilities...............       (68,947)      360,107      1,653,576
                                                                         -----------    ----------    -----------
Net Cash Provided By/(Used In) Operating Activities...................      (231,626)    2,803,426      3,372,344
                                                                         -----------    ----------    -----------
 
CASH FLOWS PROVIDED BY/(USED IN) INVESTING ACTIVITIES
       Purchase of equipment..........................................      (139,415)     (271,503)      (290,167)
       Advances to affiliate..........................................            --      (369,204)            --
       Repayments of advances from affiliate..........................            --            --        196,025
                                                                         -----------    ----------    -----------
Net Cash Provided By/(Used In) Investing Activities...................      (139,415)     (640,707)       (94,142)
                                                                         -----------    ----------    -----------
 
CASH FLOWS PROVIDED BY/(USED IN) FINANCING ACTIVITIES
  Proceeds from issuance of note payable..............................            --            --        100,000
  Payments on note payable............................................            --            --        (31,635)
  Repayment of shareholder loan.......................................            --            --         10,340
                                                                         -----------    ----------    -----------
Net Cash Provided By/(Used In) Financing Activities...................            --            --         78,705
                                                                         -----------    ----------    -----------
Net Increase/(Decrease) In Cash And Cash Equivalents..................      (371,041)    2,162,719      3,356,907
Cash And Cash Equivalents -- Beginning                                       611,333       240,292      2,403,011
                                                                         -----------    ----------    -----------
Cash And Cash Equivalents -- Ending                                      $   240,292    $2,403,011    $ 5,759,918
                                                                         -----------    ----------    -----------
                                                                         -----------    ----------    -----------
Cash Paid for Interest................................................            --            --    $     7,179
                                                                         -----------    ----------    -----------
                                                                         -----------    ----------    -----------
The accompanying notes are an integral part of these financial statements

                                      F-5
PROFESSIONAL DETAILING, INC.

                       STATEMENT OF SHAREHOLDERS' EQUITY
COMMON STOCK
                                      --------------------                                ADDITIONAL
                                      OUTSTANDING              DEFERRED     SHAREHOLDER    PAID IN          RETAINED
                                        SHARES      AMOUNT   COMPENSATION      LOAN        CAPITAL     EARNINGS/(DEFICIT)
                                      -----------   ------   ------------   -----------   ----------   ------------------
Balance -- December 31, 1994........         100     $100             --       (10,340)           --           313,798
Net loss for the year ended December
  31, 1995..........................          --       --             --            --            --          (666,838)
                                      -----------   ------   ------------   -----------   ----------   ------------------
Balance -- December 31, 1995........         100     $100     $       --     $ (10,340)   $       --      $   (353,040)
Net loss for the year ended December
  31, 1996..........................          --       --             --            --            --          (114,446)
                                      -----------   ------   ------------   -----------   ----------   ------------------
Balance -- December 31, 1996........         100      100             --       (10,340)           --          (467,486)
Stock Grant.........................          --       --             --            --     4,050,000                --
Deferred Compensation-Stock
  Options...........................          --       --       (101,822)           --       143,852                --
Repayment of shareholder loan.......          --       --             --        10,340            --                --
Net income for the year ended
  December 31, 1997.................          --       --             --            --            --        (2,948,823)
                                      -----------   ------   ------------   -----------   ----------   ------------------
Balance -- December 31, 1997........         100     $100     $ (101,822)    $       0    $4,193,852      $ (3,416,309)
                                      -----------   ------   ------------   -----------   ----------   ------------------
                                      -----------   ------   ------------   -----------   ----------   ------------------
The accompanying notes are an integral part of these financial statements

                                      F-6
PROFESSIONAL DETAILING, INC.

                         NOTES TO FINANCIAL STATEMENTS
 
1. NATURE OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES
 
  Nature of Business
 
     Professional Detailing, Inc. (the 'Company') is a leading provider of
comprehensive customized sales solutions on an outsourced basis to the United
States pharmaceutical industry.
 
  Use of Estimates
 
     The preparation of financial statements in conformity with generally
accepted accounting principles requires the Company to make estimates and
assumptions that affect the amounts reported in the financial statements. Actual
results could differ from those estimates. Significant estimates include
revenues and costs associated with the contracts, which are used for purposes of
applying the percentage-of-completion method.
 
  Revenue Recognition
 
     Revenue is earned primarily by performing services under contracts with
clients and is recognized under the percentage of completion method. Revenue
includes estimated fees or profits to be earned pursuant to contracts calculated
on the basis of the relationship between program costs, excluding initial direct
program costs, and total estimated program costs, excluding initial direct
program costs. There are two significant categories of program costs: (i)
initial direct program costs, which are associated with the recruitment and
formal training of the sales representatives and managers so that they are
qualified to properly render the services specified in the contracts and (ii)
personnel costs, which are salaries and related fringe benefits for the
representatives and managers who are responsible for the direct performance of
the activities specified in the contracts. Initial direct costs associated with
the recruitment and training of representatives are deferred and recognized over
the life of the corresponding contracts.
 
     Estimated revenue and costs are reviewed and revised periodically
throughout the lives of the contracts, with adjustment to profits resulting from
such revisions being recorded on a cumulative basis in the period in which the
revisions are made. In the period in which it is determined that a loss results
from the performance of a contract, the entire amount of the estimated ultimate
loss is charged against income.
 
     The Company must continually replace its contracts with new contracts to
sustain its revenue. In addition, many of the Company's contracts may be
canceled or delayed by clients upon notice. Contracts generally may be
terminated for a variety of reasons, including failure to meet certain
performance standards. Finally, the Company's contracts typically contain
onerous penalties if the Company fails to meet certain performance standards.
The failure to obtain new contracts or the cancellation or delay of existing
contracts or the failure to satisfy the minimum performance standards set forth
in contracts could have a material adverse effect on the Company's business and
results of operations.
 
  Fair Value of Financial Instruments
 
     The book values of cash and cash equivalents, contract payments receivable,
accounts payable and other financial instruments approximate their fair values
principally because of the short-term maturities of these instruments. The fair
value of the Company's note payable is estimated based on the current rates
offered to the Company for debt of similar terms and maturities. Under this
method, the fair value of the Company's note payable was not significantly
different than the book value of December 31, 1997.
 
  Unbilled Costs and Accrued Profits and Unearned Contract Revenue
 
     In general, contractual provisions including predetermined payment
schedules, the achievement of contract milestones or submission of appropriate
billing detail establish prerequisites for billings. Unbilled costs and accrued
profits arise when services have been rendered but clients have not been billed.
These amounts are classified as a current asset. Normally, the clients agree to
pay the Company a portion of the fee due under a
 
                                      F-7
PROFESSIONAL DETAILING, INC.

                   NOTES TO FINANCIAL STATEMENTS--(CONTINUED)
 
1. NATURE OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES--(CONTINUED)
contract in advance of performance of services because of large recruiting and
employee development costs associated with the beginning of a contract. The
excess of amounts billed over revenue recognized represents unearned contract
revenue, which is classified as a current liability.
 
  Cash and Cash Equivalents
 
     Cash and cash equivalents consist of unrestricted cash accounts and
Certificates of Deposit with a maturity of three months or less at the date of
purchase.
 
  Property, Plant and Equipment
 
     Property, plant and equipment are stated at cost. The estimated useful
lives of asset classifications are seven years for furniture and fixtures and
five years for office equipment and computer equipment. Depreciation is computed
using the straight-line method, and the cost of leasehold improvements is
amortized over the shorter of the estimated service lives or the terms of the
related leases. Repairs and maintenance are charged to expense as incurred. Upon
disposition, the asset and related accumulated depreciation are relieved and any
gains or losses are reflected in operations.
 
  Stock Based Compensation
 
     Statement of Financial Accounting Standard No. 123, 'Accounting for
Stock-Based Compensation' allows companies a choice of measuring employee
stock-based compensation expense based on the fair value method of accounting or
based upon the intrinsic value approach under APB Opinion No. 25. The Company
has elected to measure compensation expense based upon the intrinsic value
approach under APB Opinion No. 25.
 
  Advertising
 
     The Company recognizes advertising costs as incurred. The total amounts
charged to advertising expense were $242,408, $87,104 and $159,206 for the years
ended December 31, 1995, 1996 and 1997, respectively.
 
  Income Taxes
 
     The Company elected to be taxed under Subchapter S of the Internal Revenue
Code of 1986, as amended effective January 1, 1991 and under the corresponding
provisions of the laws of the State of New Jersey effective January 1, 1994.
Consequently, the Company has not been subject to Federal or New Jersey state
income taxes, other than a New Jersey corporate income tax of approximately 2%.
 
2. ANTICIPATED MERGER (UNAUDITED)
 
     In connection with a contemplated initial public offering, Professional
Detailing, Inc., a New Jersey corporation (the 'New Jersey Entity') will merge
with and into Professional Detailing, Inc., a Delaware corporation (the
'Delaware Entity'). As a result of the merger, each outstanding share of the New
Jersey Entity's Common Stock will convert into   shares of the Delaware Entity's
Common Stock. In addition, each outstanding option to purchase Common Stock of
the New Jersey Entity will convert into an option to purchase Common Stock of
the Delaware Entity at a      for      ratio.
 
3. PRO FORMA NET INCOME (LOSS) PER SHARE (UNAUDITED)
 
     Pro forma net income (loss) per share was calculated using the pro forma
weighted average number of shares of common stock and dilutive common stock
equivalent shares ('CSEs') from stock options using the treasury stock method
assuming a price of $__ per share. Pursuant to the Securities and Exchange
Commission SAB Topic 4-D, common stock and CSEs issued at prices below the
expected public offering price during the
 
                                      F-8
PROFESSIONAL DETAILING, INC.

                   NOTES TO FINANCIAL STATEMENTS--(CONTINUED)
 
3. PRO FORMA NET INCOME (LOSS) PER SHARE (UNAUDITED)--(CONTINUED)
period prior to the Company's planned offering have been included in the
computation of pro forma weighted average number of shares regardless of whether
they are dilutive and as if they were outstanding from the beginning of the
period.
 
     The following unaudited table shows the calculation of pro forma weighted
average shares outstanding as of December 31, 1997:
# OF SHARES
                                                                                             -----------
Common Stock..............................................................................
Stock Options.............................................................................
                                                                                             -----------
Pro Forma Weighted Average Shares Outstanding.............................................
                                                                                             -----------
                                                                                             -----------
Under the requirements of Statement of Financial Accounting Standards
('SFAS') No. 128, 'Earnings Per Share', basic net income (loss) per share is
computed using the weighted average number of shares of common stock outstanding
during the period and diluted net income (loss) per share is computed in a
manner similar to which pro forma weighted average shares outstanding as of
December 31, 1997 is calculated above with the exception that common stock
equivalents would be included from the date of issuance and, in any event, only
if they were dilutive.
 
     Had the Company calculated basic and diluted earnings per share pursuant to
the requirements of SFAS No. 128, basic and diluted earnings per share would
have been the following for the period ended December 31, 1997:
DECEMBER 31, 1997
                                                                                        -----------------
Basic earnings per share.............................................................
Diluted earnings per share...........................................................
4. PROPERTY, PLANT AND EQUIPMENT
 
     Property, Plant and Equipment consists of the following:
DECEMBER 31,
                                                                                 ----------------------
                                                                                   1996         1997
                                                                                 --------    ----------
Furniture and fixtures........................................................   $ 38,175    $   81,759
Office equipment..............................................................    176,366       217,796
Computer equipment............................................................    600,200       805,353
Leasehold improvements........................................................     18,693        18,693
                                                                                 --------    ----------
Total Property, Plant and Equipment...........................................    833,434     1,123,601
 
Less accumulated depreciation and amortization................................    438,372       576,224
                                                                                 --------    ----------
Property, Plant and Equipment, net............................................   $395,062    $  547,377
                                                                                 --------    ----------
                                                                                 --------    ----------
5. OPERATING LEASES
 
     The Company leases facilities and certain equipment under agreements
classified as operating leases. Lease expense under these agreements for the
twelve months ended December 31, 1995, 1996 and 1997 were $139,070, $165,020 and
$182,353, respectively. The Company's facilities lease expires on April 29,
1998. The Company has entered into a new lease to take effect May 1, 1998 for a
term of 66 months with an option to extend for an additional five years.
 
                                      F-9
PROFESSIONAL DETAILING, INC.

                   NOTES TO FINANCIAL STATEMENTS--(CONTINUED)
 
5. OPERATING LEASES--(CONTINUED)
     The following is a schedule by year of the future minimum lease payments as
of December 31, 1997 required under these agreements:
1998......................................................................................  $    368,506
1999......................................................................................       581,954
2000......................................................................................       558,075
2001......................................................................................       550,688
2002......................................................................................       550,687
Thereafter................................................................................       525,656
                                                                                            ------------
Total.....................................................................................  $  3,135,566
                                                                                            ------------
                                                                                            ------------
6. SIGNIFICANT CUSTOMERS
 
     During 1995, 1996 and 1997, the Company had several significant customers
for which it provided services under specific contractual arrangements. The
following sets forth the revenue generated by customers who accounted for more
than 10% of the Company's revenue during each of the periods presented.
YEARS ENDED DECEMBER 31,
              -----------------------------------------
CUSTOMERS        1995           1996           1997
----------    ----------     ----------     -----------
A         $7,736,949     $9,878,375     $13,501,927
    B             *              *           12,253,147
    C          3,073,356      5,456,868      10,543,052
    D          1,861,630      5,389,530          *
    E             *           6,925,230          *
    F          2,758,620         *               *
------------------
* Less than 10% of revenue.
 
     At December 31, 1996 and 1997, these customers represented 98.3% and 79.5%,
respectively, of outstanding receivables and unbilled services. The loss of any
one of the foregoing customers could have a material adverse effect on the
Company's financial position, results of operations or cash flows.
 
7. BORROWINGS
 
     On January 7, 1997, the Company entered into a $100,000 note payable
agreement with a commercial bank with an interest rate of 8.25% maturing on
January 7, 2000. The note is collateralized by all present and future assets of
the Company and a personal guarantee by the majority shareholder. Payments of
$3,145, including principal and interest, are payable monthly. In addition the
Company has a $500,000 line of credit from the bank under which interest would
be payable monthly on the outstanding balance at a floating rate equal to 1%
above the prime rate. The Company has also obtained a commitment from the bank
for a $1 million line of credit, the proceeds of which are to be used
exclusively for capital expenditures. This line would be for a term of nine
months and would bear interest payable monthly at a floating rate equal to 0.75%
above the prime rate. At the end of the nine months, any outstanding balance
would be payable in 60 equal monthly installments of principal and interest
computed at a rate of 0.75% above the prime rate on the date of conversion.
 
     As of December 31, 1997, the Company has not drawn on either line. Both
lines are secured collateralized by a lien on all of the assets of the Company
and the personal guaranty of the Company's majority shareholder. In addition, if
the Company were to draw on such lines, it could be subject to certain
restrictive financial covenants and other customary provisions found in
commercial loan documentation. Committment fees associated with the lines are
immaterial.
 
                                      F-10
PROFESSIONAL DETAILING, INC.

                   NOTES TO FINANCIAL STATEMENTS--(CONTINUED)
 
8. RELATED PARTY TRANSACTIONS
 
     In 1996 and 1997, the Company purchased certain print advertising for
initial recruitment of representatives through a company that was wholly owned
by the Company's majority shareholder. Additionally, the Company also provided
administrative services to this affiliate. The net amounts charged to the
Company for these purchases amounted to $671,810 and $1,564,606 for the years
ended December 31, 1996 and 1997. As of December 31, 1996 and 1997, the amounts
payable to affiliate totaled $284,877 and $146,018, respectively. The Company
also made advances to this affiliate in 1996. As of December 31, 1996 and 1997,
the amounts due the Company as a result of these advances were $369,204 and
$173,179, respectively.
 
9. LOAN TO SHAREHOLDER
 
     As of December 31, 1996 and 1995, the Company had loans of $10,340 to its
then sole shareholder. Such loans were repaid in 1997.
 
10. RETIREMENT PLANS
 
     In 1995, 1996 and 1997, the Company provided its employees with a qualified
profit sharing plan with 401(k) features. The Company made contributions of
$58,667, $99,917 and $172,310 to this plan for the years ended December 31,
1995, 1996 and 1997, respectively.
 
     Effective January 1, 1997, the Company has committed to make mandatory
contributions to the 401(k) plan. This commitment requires contributions from
the Company each year equal to 100% of the amount contributed by each employee
up to 2% of the employee's wages. Any additional contribution to the plan is at
the discretion of the Company.
 
11. COMMITTMENTS AND CONTINGENCIES
 
     The Company is engaged in the business of detailing pharmaceutical
products. Such activities could expose the Company to risk of liability for
personal injury or death to persons using such products, although the Company
does not commercially market or sell the products to end users. While the
Company has not been subject to any claims or incurred any liabilities due to
such claims, there can be no assurance that substantial claims or liabilities
will not arise in the future. The Company seeks to reduce its potential
liability through measures such as contractual indemnification provisions with
clients (the scope of which may vary from client to client, and the performances
of which are not secured) and reliance on insurance maintained by clients. The
Company could, however, also be held liable for errors and omissions of its
employees in connection with the services it performs that are outside the scope
of any indemnity. The Company could be materially and adversely affected if it
were required to pay damages or incur defense costs in connection with a claim
that is outside the scope of the indemnification agreements; if the indemnity,
although applicable, is not performed in accordance with its terms; or if the
Company's liability exceeds the amount of applicable insurance or indemnity. The
Company currently does not carry product liability insurance and is not insured
against the errors and omissions of its employees.
 
     From time to time the Company is involved in litigation incidental to its
business. The Company is not currently a party to any pending litigation which,
if decided adversely to the Company, would have a material adverse effect on the
business, financial condition or results of operations of the Company and the
Company is not aware of any material threatened litigation.
 
12. STOCK GRANT
 
     In January of 1997, the Company issued 15 shares of its Common Stock to its
President and Chief Operating Officer. As a result, he owned 15.0% of the
Company's outstanding shares of common stock at that time (taking into account
the issuance of such shares).
 
                                      F-11
PROFESSIONAL DETAILING, INC.

                   NOTES TO FINANCIAL STATEMENTS--(CONTINUED)
 
12. STOCK GRANT--(CONTINUED)
     This grant of stock was in consideration of services performed on behalf of
the Company. The value of the shares was determined by an independent appraiser
to be $4,050,000 utilizing standard valuation techniques used to value
businesses including discounted cash flow and comparable transactions. The
Company has recognized $4,470,000 in compensation and related expenses in the
first quarter of 1997.
 
13. STOCK OPTION PLAN
 
     Effective in January of 1997, the Company adopted its 1997 Stock Option
Plan (the 'Plan'). A total of 1 share of common stock has been reserved for
issuance under the Plan. Pursuant to the Plan, the Company may grant incentive
stock options and nonqualified options to eligible officers, directors and key
employees and consultants of the Company. The selection of participants,
allotment of shares, determination of price and other conditions relating to the
granting of options is currently determined by the Company's shareholders. As of
December 31, 1997 there were .1 shares remaining in the Plan which were
available for future grant.
 
     Options granted under the Plan, once vested, are exercisable for a period
of up to 10 years from the date of grant at an exercise price which is not less
than 100% of the fair market value of the Common Stock on the date of grant,
unless otherwise determined by the Company's shareholders.
 
     During 1997, there were two grants of stock options to officers of the
Company, one in January for .525 shares at an exercise price of $63,000 and one
in March for .375 shares at an exercise price of $45,000. Both grants expire on
December 31, 2005. In connection with the grant of such options, the Company
will amortize $143,852 of compensation expense over the expected vesting period.
The options are expected to vest as follows: one-third shall be exercisable on
the earlier of June 30, 1998 or the date of the initial public offering (the
'Initial Exercise Date'), another third shall become exercisable on the first
anniversary of the Initial Exercise Date and the final third become exercisable
on the second anniversary of the Initial Exercise Date. As of December 31, 1997,
none of the options were exercisable as the public offering had not yet taken
place and $42,030 of compensation expense has been recognized. The
weighted-average remaining contractual life of the outstanding options was 6.9
years. There were no options granted for any period prior to December 31, 1996.
 
     Had compensation cost for the Company's stock option grants been determined
for awards consistent with the fair value approach of Statement of Financial
Accounting Standard No. 123, 'Accounting for Stock Based Compensation,' which
requires recognition of compensation cost ratably over the vesting period of the
underlying instruments, the Company's net loss would have been increased to the
pro forma amounts indicated below:
1997
                                                                                           ------------
Net loss--As reported...................................................................     (2,948,823)
Net loss--Pro forma.....................................................................     (2,957,075)
Basic Earnings Per Share--as reported...................................................
Basic Earnings Per Share--Pro forma.....................................................
Diluted Earnings per share--as reported.................................................
Diluted Earnings per share--Pro forma...................................................
Compensation cost for the determination of Net income--Pro forma and
related per share amounts were estimated using a minimum value approach with an
option pricing model and the following assumptions (i) risk free interest rate
6.27%, (ii) expected life 5 years, (iii) expected dividends--0. The fair value
of options granted during 1997 was $172,169.
 
                                      F-12
PROFESSIONAL DETAILING, INC.

                   NOTES TO FINANCIAL STATEMENTS--(CONTINUED)
 
14. PRO FORMA INFORMATION (UNAUDITED)
 
  Pro Forma Provision For (Benefit From) Income Tax
 
     The accompanying financial statements reflect a provision/benefit for
income taxes on a pro forma basis as if the Company were subject to Federal and
New Jersey state income taxes as a taxable corporate entity throughout the years
presented. The pro forma income tax provision is based upon the statutory rates
in effect for C Corporations during the periods presented.
 
     Certain events, including the public offering of the Company's common
stock, will automatically terminate the Company's S Corporation status, thereby
subjecting future income to Federal and New Jersey state income taxes. Due to
temporary differences in the recognition of revenue and expenses, income for
financial reporting purposes has exceeded income for income tax purposes.
Accordingly, the application of the provisions of SFAS No. 109, 'Accounting for
Income Taxes' will result in the recognition of a net deferred tax liability
(and a corresponding one-time charge to expense) in the period in which the
initial public offering occurs. If the S Corporation status had been terminated
as of December 31, 1997, this amount would have been immaterial.
 
  Pro Forma Balance Sheet
 
     The December 31, 1997 pro forma balance sheet as set forth herein reflects
the estimated distribution as of December 31, 1997 of $675,721 to the Company's
shareholders immediately prior to the public offering. Such distribution is
assumed to be funded by the Company's cash on hand as if distribution was made
on December 31, 1997.
 
15. NEW ACCOUNTING PRONOUNCEMENTS
 
     Statement of Financial Accounting Standards No. 130, Reporting
Comprehensive Income, was issued in June 1997 and is effective for fiscal years
beginning after December 15, 1997. This pronouncement establishes standards for
reporting and display of comprehensive income and its components in a full set
of general-purpose financial statements. The Company will adopt this
pronouncement in 1998 and does not expect its implementation will have a
material effect on the Company's financial statements as currently presented.
 
     Statement of Financial Accounting Standards No. 131, Disclosures About
Segments of an Enterprise and Related Information, was also issued in June 1997
and is effective for fiscal periods beginning after December 15, 1997. This
pronouncement establishes the way in which publicly held business enterprises
report information about operating segments in annual financial statements and
interim reports to stockholders. As the Company operates in a single business
segment the implementation of this standard is not expected to significantly
impact the Company's financial statements as currently presented.
 
                                      F-13
[LOGO]
 
                          PROFESSIONAL DETAILING, INC.
PART II
 
                     INFORMATION NOT REQUIRED IN PROSPECTUS
 
ITEM 13.  OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
 
     Expenses in connection with the issuance and distribution of the Securities
being registered hereunder, other than underwriting discounts and commissions,
are estimated below.
SEC registration fee.........................................................................   $13,570
NASD filing fee..............................................................................      *
Nasdaq National Market listing fee...........................................................      *
Printing and engraving costs.................................................................      *
Accounting fees and expenses.................................................................      *
Legal fees and expenses......................................................................      *
State securities law fees and expenses including fees of counsel.............................      *
Transfer Agent and Registrar fees and expenses...............................................     3,500
Miscellaneous................................................................................      *
     Total...................................................................................   $  *
                                                                                                -------
                                                                                                -------
------------------
 
* To be provided by amendment.
 
ITEM 14.  INDEMNIFICATION OF DIRECTORS AND OFFICERS
 
     The Underwriting Agreement provides for reciprocal indemnification between
the Company and its controlling persons, on the one hand, and the Underwriters
and their respective controlling persons, on the other hand, against certain
liabilities in connection with this Offering, including liabilities under the
Securities Act of 1933, as amended (the 'Securities Act').
 
     The Registrant's Certificate of Incorporation and By-Laws provide that the
Registrant shall indemnify its directors to the full extent permitted by the
General corporation Law of the State of Delaware (the 'DGCL') and may indemnify
its officers and employees to such extent, except that the Registrant shall not
be obligated to indemnify any such person with respect to proceedings, claims or
actions initiated or brought voluntarily by any such person and not by way of
defense, or for any amounts paid in settlement of an action indemnified against
by the Registrant without the prior written consent of the Registrant. The
Registrant intends to enter into indemnity agreements with each of its
directors. These agreements may require the Registrant, among other things, to
indemnify such directors against certain liabilities that may arise by reason of
their status or service as directors, and to advance expenses to them as they
are incurred, provided that they undertake to repay the amount advanced if it is
ultimately determined by a court that they are not entitled to indemnification,
and to obtain directors' liability insurance if available on reasonable terms.
 
     In addition, the Registrant's Certificate of Incorporation provides that a
director of the Registrant shall not be personally liable to the Registrant or
its stockholders for monetary damages for breach of his or her fiduciary duty as
director, except for liability (i) for any breach of the directors' duty or
loyalty to the Registrant or its stockholders, (ii) for acts or omissions not in
good faith or which are intentional misconduct or a knowing violation of law,
(iii) for willful or negligent conduct in paying dividends or repurchasing stock
out of any other lawfully available funds or (iv) for any transaction from which
the director derives an improper personal benefit.
 
ITEM 15.  RECENT SALES OF UNREGISTERED SECURITIES
 
     During the past three years the Company issued the following unregistered
securities:
 
          On January 1, 1997 the Company issued shares of its Common Stock
     representing 15% of the total number of shares then outstanding to its then
     President and Chief Operating Officer, Charles T. Saldarini. The
     transaction described above did not involve a public offering of the
     Registrant's securities and was exempt from the registration requirements
     of the Securities Act pursuant to Section 4(2) thereof and by reason of
     Regulation D under the Securities Act.
 
                                      II-1
ITEM 16.  EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
 
     (a) Exhibits:
EXHIBIT
   NO.                                                 DESCRIPTION
---------  ----------------------------------------------------------------------------------------------------
1.1       Form of Underwriting Agreement
 
 2.1       Merger Agreement between Professional Detailing, Inc., a New Jersey corporation, and Professional
           Detailing Inc., a Delaware corporation*
 
 3.1       Certificate of Incorporation of Professional Detailing, Inc.
 
 3.2       By-Laws of Professional Detailing, Inc.
 
 4.1       Specimen Certificate Representing the Common Stock*
 
 5.1       Form of Opinion of Morse, Zelnick, Rose & Lander, LLP*
 
10.1       1998 Stock Option Plan*
 
10.2       Office Lease between IB Brell, L.P. (Landlord) and Professional Detailing, Inc. (Tenant) and
           amendment thereto
 
10.3       Employment Agreement between the Company and Charles T. Saldarini*
 
10.4       Employment Agreement between the Company and John P. Dugan*
 
10.5       Employment Agreement between the Company and Steven K. Budd*
 
10.6.      Employment Agreement between the Company and Bernard C. Boyle*
 
23.1       Consent of Coopers & Lybrand L.L.P.
 
23.2       Consent of Morse, Zelnick, Rose & Lander, LLP (included in Exhibit 5.1)*
 
23.3       Consent of Farkas & Manelli, P.L.L.C.
 
24         Power of Attorney (included in signature page)
 
27         Financial Data Schedule
 
99.1       Consent of Director Nominee (John M. Pietruski)
 
99.2       Consent of Director Nominee (Jan Martens Vecsi)
 
99.3       Consent of Director Nominee (Gerald J. Mossinghoff)
------------------
* To be filed by amendment
 
                                      II-2
ITEM 17.  CERTAIN UNDERTAKINGS
 
     A. The undersigned Registrant hereby undertakes to provide to the
Underwriters at the closing specified in the Underwriting Agreement,
certificates in such denominations and registered in such names as required by
the Underwriters to permit prompt delivery to each purchaser.
 
     B. The undersigned Registrant hereby undertakes that:
 
          (1) For purposes of determining any liability under the Securities Act
     of 1933, the information omitted from the form of prospectus filed as part
     of this registration statement in reliance upon Rule 430A and contained in
     a form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or
     (4) or 497(h) under the Securities Act shall be deemed to be part of this
     registration statement as of the time it was declared effective.
 
          (2) For the purpose of determining any liability under the Securities
     Act of 1933, each post-effective amendment that contains a form of
     prospectus shall be deemed to be a new registration statement relating to
     the securities offered therein, and the Offering of such securities at that
     time shall be deemed to be the initial bona fide offering thereof.
 
     C. Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Securities Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a director, officer or controlling person of the Registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
 
                                      II-3
SIGNATURES
 
     Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized in the City of Mahwah,
State of New Jersey, on the 13th day of February, 1998.
 
                                          PROFESSIONAL DETAILING, INC.
 
                                          By: /s/ Charles T. Saldarini
                                            ------------------------------------
                                              Charles T. Saldarini,
                                              President and Chief Executive
                                              Officer
 
     KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Charles T. Saldarini, and Kenneth S. Rose, or any
one of them, his true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for him and in his name, place and stead, in
any and all capacities, to sign any and all pre- or post- effective amendments
to this Registration Statement, and to file the same with all exhibits thereto,
and other documents in connection therewith, with the Securities and Exchange
Commission, granting unto said attorneys-in-fact and agents, and each of them,
full power and authority to do and perform each and every act and thing
requisite or necessary to be done in and about the premises, as fully to all
intents and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or any one of them, or
their or his substitutes, may lawfully do or cause to be done by virtue hereof.
 
     Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed by the following persons in the
capacities indicated and on the 13th day of February, 1998.
SIGNATURE                                      TITLE
--------------------------------    --------------------------------------------------
/s/ JOHN P. DUGAN                   Chairman of the Board of Directors
-------------------------------
John P. Dugan
 
/s/ CHARLES T. SALDARINI            President, Chief Executive Officer and Director
-------------------------------
Charles T. Saldarini
 
/s/ BERNARD C. BOYLE                Chief Financial Officer (Principal Accounting
-------------------------------     Officer)
Bernard C. Boyle
II-4
EXHIBIT INDEX
EXHIBIT
   NO.                                                 DESCRIPTION
---------  ----------------------------------------------------------------------------------------------------
1.1       Form of Underwriting Agreement
 
 2.1       Merger Agreement between Professional Detailing, Inc., a New Jersey corporation, and Professional
           Detailing Inc., a Delaware corporation*
 
 3.1       Certificate of Incorporation of Professional Detailing, Inc.
 
 3.2       By-Laws of Professional Detailing, Inc.
 
 4.1       Specimen Certificate Representing the Common Stock*
 
 5.1       Form of Opinion of Morse, Zelnick, Rose & Lander, LLP*
 
10.1       1998 Stock Option Plan*
 
10.2       Office Lease between IB Brell, L.P. (Landlord) and Professional Detailing, Inc. (Tenant) and
           amendment thereto
 
10.3       Employment Agreement between the Company and Charles T. Saldarini*
 
10.4       Employment Agreement between the Company and John P. Dugan*
 
10.5       Employment Agreement between the Company and Steven K. Budd*
 
10.6.      Employment Agreement between the Company and Bernard C. Boyle*
 
23.1       Consent of Coopers & Lybrand L.L.P.
 
23.2       Consent of Morse, Zelnick, Rose & Lander, LLP (included in Exhibit 5.1)*
 
23.3       Consent of Farkas & Manelli, P.L.L.C.
 
24         Power of Attorney (included in signature page)
 
27         Financial Data Schedule
 
99.1       Consent of Director Nominee (John M. Pietruski)
 
99.2       Consent of Director Nominee (Jan Martens Vecsi)
 
99.3       Consent of Director Nominee (Gerald J. Mossinghoff)
------------------
* To be filed by amendment