SEC FORM 5

SEC Form 5

FORM 5

UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

ANNUAL STATEMENT OF CHANGES IN BENEFICIAL OWNERSHIP

Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934
or Section 30(h) of the Investment Company Act of 1940

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Check this box if no longer subject to Section 16. Form 4 or Form 5 obligations may continue. See Instruction 1(b).

Form 3 Holdings Reported.

Form 4 Transactions Reported.

1. Name and Address of Reporting Person^*

TONEY C FRED

(Last)

(First)

(Middle)

500 THIRD STREET #535

(Street)

SAN FRANCISCO

94107

(City)

(State)

(Zip)

2. Issuer Name and Ticker or Trading Symbol
DRUGMAX INC [ DMAX ]

5. Relationship of Reporting Person(s) to Issuer
(Check all applicable)

Director	X	10% Owner
Officer (give title below)		Other (specify below)

3. Statement for Issuer's Fiscal Year Ended (Month/Day/Year)
01/01/2006

4. If Amendment, Date of Original Filed (Month/Day/Year)

6. Individual or Joint/Group Filing (Check Applicable Line)

X	Form filed by One Reporting Person
	Form filed by More than One Reporting Person

Table I - Non-Derivative Securities Acquired, Disposed of, or Beneficially Owned
1. Title of Security (Instr. 3)	2. Transaction Date (Month/Day/Year)	2A. Deemed Execution Date, if any (Month/Day/Year)	3. Transaction Code (Instr. 8)	4. Securities Acquired (A) or Disposed Of (D) (Instr. 3, 4 and 5)			5. Amount of Securities Beneficially Owned at end of Issuer's Fiscal Year (Instr. 3 and 4)	6. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	7. Nature of Indirect Beneficial Ownership (Instr. 4)
1. Title of Security (Instr. 3)	2. Transaction Date (Month/Day/Year)	2A. Deemed Execution Date, if any (Month/Day/Year)	3. Transaction Code (Instr. 8)	Amount	(A) or (D)	Price		6. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	7. Nature of Indirect Beneficial Ownership (Instr. 4)
Common Stock	10/14/2005		P4	3,100	A	$1.411	9,301,601	I	See Footnotes⁽¹⁾⁽²⁾⁽³⁾
Common Stock	10/17/2005		P4	5,500	A	$1.3549	9,307,101	I	See Footnotes⁽¹⁾⁽²⁾⁽³⁾
Common Stock	10/18/2005		P4	45,000	A	$1.4254	9,352,101	I	See Footnotes⁽¹⁾⁽²⁾⁽³⁾
Common Stock	10/19/2005		P4	5,100	A	$1.4885	9,357,201	I	See Footnotes⁽¹⁾⁽²⁾⁽³⁾
Common Stock	10/20/2005		P4	10,100	A	$1.4446	9,367,301	I	See Footnotes⁽¹⁾⁽²⁾⁽³⁾
Common Stock	10/21/2005		P4	15,700	A	$1.3858	9,383,001	I	See Footnotes⁽¹⁾⁽²⁾⁽³⁾
Common Stock	10/24/2005		P4	25,300	A	$1.4448	9,408,301	I	See Footnotes⁽¹⁾⁽²⁾⁽³⁾
Common Stock	10/25/2005		P4	26,100	A	$1.4302	9,434,401	I	See Footnotes⁽¹⁾⁽²⁾⁽³⁾
Common Stock	10/27/2005		P4	600	A	$1.3767	9,435,001	I	See Footnotes⁽¹⁾⁽²⁾⁽³⁾
Common Stock	10/28/2005		P4	300	A	$1.3867	9,435,301	I	See Footnotes⁽¹⁾⁽²⁾⁽³⁾
Common Stock	10/28/2005		P4	8,000	A	$1.3596	9,443,301	I	See Footnotes⁽¹⁾⁽²⁾⁽³⁾
Common Stock	10/31/2005		P4	257,574	A	$1.6341	9,700,875	I	See Footnotes⁽¹⁾⁽²⁾⁽³⁾
Common Stock	11/15/2005		P4	54,000	A	$1.2275	9,754,875	I	See Footnotes⁽¹⁾⁽²⁾⁽³⁾
Common Stock	11/15/2005		S4	7,000	D	$1.1104	9,747,875	I	See Footnotes⁽¹⁾⁽²⁾⁽³⁾
Common Stock	11/18/2005		P4	53,969	A	$1.2849	9,801,844	I	See Footnotes⁽¹⁾⁽²⁾⁽³⁾
Common Stock	11/21/2005		P4	43,000	A	$1.4283	9,448,844	I	See Footnotes⁽¹⁾⁽²⁾⁽³⁾
Common Stock	11/22/2005		P4	25,000	A	$1.25	9,869,844	I	See Footnotes⁽¹⁾⁽²⁾⁽³⁾
Common Stock	11/22/2005		P4	20,000	A	$1.3013	9,889,844	I	See Footnotes⁽¹⁾⁽²⁾⁽³⁾
Common Stock	11/23/2005		P4	10,000	A	$1.25	9,899,844	I	See Footnotes⁽¹⁾⁽²⁾⁽³⁾
Common Stock	11/23/2005		P4	15,500	A	$1.2492	9,915,344	I	See Footnotes⁽¹⁾⁽²⁾⁽³⁾
Common Stock	11/28/2005		P4	60,000	A	$1.2679	9,975,344	I	See Footnotes⁽¹⁾⁽²⁾⁽³⁾
Common Stock	11/29/2005		P4	46,800	A	$1.1647	10,022,144	I	See Footnotes⁽¹⁾⁽²⁾⁽³⁾
Common Stock	11/29/2005		P4	74,600	A	$1.2189	10,096,744	I	See Footnotes⁽¹⁾⁽²⁾⁽³⁾
Common Stock	11/30/2005		P4	220,000	A	$1.3116	10,316,744	I	See Footnotes⁽¹⁾⁽²⁾⁽³⁾
Common Stock	12/08/2005		P4	1,300	A	$1.1855	10,318,044	I	See Footnotes⁽¹⁾⁽²⁾⁽³⁾

Table II - Derivative Securities Acquired, Disposed of, or Beneficially Owned (e.g., puts, calls, warrants, options, convertible securities)
1. Title of Derivative Security (Instr. 3)	2. Conversion or Exercise Price of Derivative Security	3. Transaction Date (Month/Day/Year)	3A. Deemed Execution Date, if any (Month/Day/Year)	4. Transaction Code (Instr. 8)	5. Number of Derivative Securities Acquired (A) or Disposed of (D) (Instr. 3, 4 and 5)		6. Date Exercisable and Expiration Date (Month/Day/Year)		7. Title and Amount of Securities Underlying Derivative Security (Instr. 3 and 4)		8. Price of Derivative Security (Instr. 5)	9. Number of derivative Securities Beneficially Owned Following Reported Transaction(s) (Instr. 4)	10. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	11. Nature of Indirect Beneficial Ownership (Instr. 4)
1. Title of Derivative Security (Instr. 3)	2. Conversion or Exercise Price of Derivative Security	3. Transaction Date (Month/Day/Year)	3A. Deemed Execution Date, if any (Month/Day/Year)	4. Transaction Code (Instr. 8)	(A)	(D)	Date Exercisable	Expiration Date	Title	Amount or Number of Shares	8. Price of Derivative Security (Instr. 5)		10. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	11. Nature of Indirect Beneficial Ownership (Instr. 4)

Explanation of Responses:

1. 7,809,111 shares of common stock reported on this Form 5 are beneficially held by MedCap Partners L.P., and the balance is beneficially held by an offshore investment limited partnership. MedCap Management & Research LLC ("MMR"), a registered investment advisor, is the general partner and investment manager of both MedCap Partners, L.P. and the investment limited partnership. C. Fred Toney, the reporting person, is the sole member of MMR. Mr. Toney also holds, directly and indirectly, certain limited partnership interests in MedCap Partners L.P.

2. All of the transactions reported on this Form 5 were made by the investment limited partnership, which, for Section 16 purposes, is not itself the beneficial owner of more than 10% of the issuer's common stock. Because Mr. Toney, as the sole member of MMR, may be deemed to be a "control person" who, for the purposes of Rule 16a-1(a)(1)(vii), may be deemed to hold in excess of 1% of the issuer's common stock indirectly through his limited partnership interests in MedCap Partners L.P., Mr. Toney has elected to voluntarily file this Form 5 to report the aggregated holdings of MedCap Partners L.P. and the investment limited partnership, as well as transactions by the investment limited partnership.

3. Mr. Toney's election to file this Form 5 should not be construed as an admission of his status as such a control person, or as a 10% beneficial owner of the issuer's common stock for Section 16 purposes. In any event, Mr. Toney expressly disclaims his beneficial ownership in the securities reported on this Form 5, except to the extent of his pecuniary interest therein. For Section 13 reporting purposes, the beneficial ownership of the issuer's securities reported here has also been reported separately on a Schedule 13G filed with the Commission. MMR also disclaims beneficial interest in the securities reported on this Form 5, pursuant to Rule 16a-1(a)(1)(v).

Remarks:

	/s/ C. Fred Toney	01/26/2006
	** Signature of Reporting Person	Date
Reminder: Report on a separate line for each class of securities beneficially owned directly or indirectly.
* If the form is filed by more than one reporting person, see Instruction 4 (b)(v).
** Intentional misstatements or omissions of facts constitute Federal Criminal Violations See 18 U.S.C. 1001 and 15 U.S.C. 78ff(a).
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