CVGR Covalent

Covalent Group, Inc. (Nasdaq: CVGR), a leader in the design, development, and management of complex clinical trials and patient registries for many of the world's leading pharmaceutical and biotechnology companies, announced today the signing of a $1.0 million contract for a Phase 1 study of a potentially very important agent to prevent/treat infectious disease. Covalent will provide consulting services, clinical operations support, and Phase 1 Unit oversight for the trial. Revenue recognition, which will begin immediately, will occur on a proportional performance basis over the next several quarters. Kenneth M. Borow, M.D., Chief Executive Officer and President for Covalent Group, commented, "Because of the potential importance of this drug, we are exceptionally proud to have been chosen by this client to help initiate the drug's development program. This contract fits very well with our already proven expertise in the development of novel therapeutics to prevent/treat infectious diseases including vaccines for counter-bioterrorism purposes." Dr. Borow continued, "On a year-to-date basis, Covalent has announced nearly $11 million of new business contracts including this new business award. We anticipate that revenue recognition for all of these contracts will begin during the second quarter of 2006. These contracts are with nine different clients, five of whom are new to Covalent. If these trials are successful, it is anticipated that additional clinical research studies will be conducted by each of the Sponsors and that Covalent will be well positioned to participate in these future programs." Dr. Borow concluded, "We are making excellent progress integrating processes and services in support of our recently announced combination agreement with Remedium Oy. We anticipate that this combination will be finalized by June 30, 2006. Importantly, we are already seeing new business development as well as other opportunities that reflect the increased competitive position of our expanded geographic and operational service offerings. We look forward to the launch this summer of our new combined entity, Encorium BioSolutions, Inc." About Covalent Group, Inc. Covalent Group, Inc. is a clinical research organization that is a leader in the design and management of complex clinical trials and Patient Disease Registries for the pharmaceutical, biotechnology and medical device industries. The Company's mission is to provide its clients with high quality, full-service support for their biopharmaceutical development programs. Covalent offers therapeutic expertise, experienced team management and advanced technologies. The Company has drug and biologics development as well as clinical trial experience across a wide variety of therapeutic areas such as cardiovascular, endocrinology/metabolism, diabetes, vaccines, infectious diseases, gene therapy, immunology, neurology, oncology, gastroenterology, dermatology, hepatology, women's health and respiratory medicine. Covalent believes that its leadership in the design of complex clinical trials, its therapeutic expertise and commitment to excellence, and its application of innovative technologies, offer its clients a means to more quickly and cost effectively move products through the clinical development process. With its wholly-owned international subsidiary, Covalent Group, Ltd., Covalent is able to meet the North American and Western European drug development needs of its clients. For more information, please visit www.covalentgroup.com. This press release contains forward-looking statements identified by words such as "estimate," "project," "expect," "intend," "believe," "anticipate" and similar expressions. Actual results might differ materially from those projected in, expressed in or implied by the forward-looking statements. Potential risks and uncertainties that could affect the Company's future operating results and financial condition include, without limitation: (i) our success in attracting new business and retaining existing clients and projects; (ii) the size, duration, and timing of clinical trials we are currently managing may change unexpectedly; (iii) the termination, delay or cancellation of clinical trials we are currently managing could cause revenues to decline unexpectedly; (iv) the timing difference between our receipt of contract milestone or scheduled payments and our incurring costs to manage these trials; (v) outsourcing trends in the pharmaceutical, biotechnology and medical device industries; (vi) the ability to maintain profit margins in a competitive marketplace; (vii) our ability to attract and retain qualified personnel; (viii) the sensitivity of our business to general economic conditions; (ix) other economic, competitive, governmental and technological factors affecting our operations, markets, products, services and prices; (x) announced awards received from existing and potential customers are not definitive until fully negotiated contracts are executed by the parties;(xi) our backlog may not be indicative of future revenues and may not generate the revenues expected;(xii) our ability to successfully integrate the businesses of Covalent and Remedium and (xiii) the performance of the combined business to operate successfully and generate growth. You should not place any undue reliance on these forward looking statements which speak only as of the date of this press release. Additional information concerning factors that might affect our business or stock price which could cause actual results to materially differ from those in forward-looking statements is contained in Covalent Group's SEC filings, including its Annual Report on Form 10-K for the year ended December 31, 2005 and other periodic reports under the Securities Exchange Act of 1934, as amended, copies of which are available upon request from Covalent Group's investor relations department or The Equity Group Inc.