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CORRESP
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Biotel Inc. Correspondence dated January 14, 2005

[Gray Plant Mooty Letterhead]

     Reply to Minneapolis

Rick Hauser

612/632.3095

Rick.Hauser@gpmlaw.com

January 14, 2005

     Thomas A. Jones, Esq.
     VIA EDGAR

     United States Securities Exchange Commission
     AND FEDERAL EXPRESS

     450 Fifth Street NW

     Washington, D.C. 20549

           RE:
     Biotel Inc. (the “Company”)

     Amendment No. 2 to Registration Statement on Form 10-SB

Filed December 27, 2004

File
No. 0-50914

Dear Mr. Jones:

In response to the Staff’s
comments dated January 11, 2005, we are providing the following supplemental information
provided by the Company. The paragraph number corresponds to the paragraph number
contained in your January 11, 2005 comment letter:

Part F/S

Notes to
Consolidated Financial Statements – Page F-21

Note
16 – Asset Purchase – Page F-32

          1.

          Enclosed are the calculations outlined at Item 310(c)(2)(iii) of Regulation S-B.
          As set forth therein, the equity in the loss of Agility Centralized Research
          Services, LLC (“Agility”) for the period ended June 30, 2004 was
          (10.80%) of the Company’s consolidated income for the fiscal year ended
          June 30, 2004. Because such amount is less than 20%, historical financial
          statements for Agility are not required by Item 310(c) of Regulation S-B.

Thomas A. Jones, Esq.

January 14, 2005

Page 2

Also enclosed is the Company’s
statement regarding certain acknowledgements.

Let me know if you have any questions
or require any other information.

     Regards,

     GRAY, PLANT, MOOTY,

           MOOTY & BENNETT, P.A.

     By      /s/ Rick Hauser

     Rick Hauser

GP:1668293 v2

BIOTEL, INC.

310(c)(2)(iii) Calculations

Relevant Facts

Biotel Inc. acquired the assets of
Agility Centralized Research Services, LLC on July 1, 2004

Agility Centralized Research Services, LLC was formed during Nov 2003, but significant operations didn’t start until Jan 2004

Agility Centralized Research Services, LLC had a calender year-end

Agility Centralized Research Services, LLC’s pretax loss for its six months of operations ending on June 30, 2004 was $113,233

Biotel Inc.‘s pretax net income for the fiscal year ending June 30, 2004 was $1,048,346

           Equity in the loss of the acquiree for the six months ending June 30, 2004
     (113,233)

     =
     -10.80%

           Consolidated income of the Biotel Inc. for the year ending June 30, 2004
     1,048,346

[Biotel
Inc. Letterhead]

January 13, 2005

     United States Securities Exchange Commission
     VIA EDGAR

     450 Fifth Street NW
     AND FEDERAL EXPRESS

     Washington, D.C.  20549

           RE:
     Biotel Inc. (the “Company”)

Ladies and Gentlemen:

In connection with the Company’s
response to the Staff’s comments dated January 11, 2005, the Company makes the
following acknowledgements:

•

The
Company is responsible for the adequacy and accuracy of the disclosure in the filing;

•

 Staff
comments or changes to disclosure in response to staff comments do not foreclose the
Commission from taking any action with respect to the filing; and

•

The
Company may not assert staff comments as a defense in any proceeding initiated by the
Commission or any person under the federal securities laws of the United States.

Please contact
me if you should have any questions.

     Sincerely,

     By      /s/ B. Steven Springrose

     B. Steven Springrose, CEO

GP:1668322 v2