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FOR IMMEDIATE RELEASE

Medsphere® Names Industry Veteran John Danahy Vice President of Sales

Former McKesson Executive to Expand National Sales Organization, Extend Stage 6 Benefits to Entire Healthcare Sector


ALISO VIEJO, CA - April 8, 2008 — Medsphere® Systems Corporation, the leading commercial provider of Open Source electronic health record (EHR) systems and services, today announced that John Danahy has joined the company as vice president of sales. With more than fifteen years of exceptional healthcare IT sales performance to his credit, Danahy is charged with aggressively expanding Medsphere's national sales organization and leveraging the success of current partners, specifically the recent designation of Midland Memorial Hospital as a Health Information Management and Systems Society (HIMSS) Analytics Stage 6 facility.

Danahy comes to Medsphere from Fortune 18 healthcare services company McKesson Corporation, where he was vice president of customer operations for new business in the western region. His range of duties at McKesson included developing and maintaining relationships with hospitals, integrated delivery networks, and corporate partners such as EMC, Hewlett-Packard (HP), and Cisco. With primary responsibility for more than $70 million in revenue, Danahy also managed a customer operations team while proactively developing strategic cross-selling programs for the full line of McKesson software, hardware, and service offerings.

"John Danahy is an impressive individual with a passion for the future of healthcare. His diverse knowledge of healthcare operations, combined with his contacts in the industry, will be of immense help in getting our message before a wide range of potential customers," said Rick Jung, Medsphere chief operating officer. "He is also experienced at growing and leading a highly-productive sales team, a talent that will benefit Medsphere greatly as we develop our national sales organization."

Danahy earned his position at McKesson based on his achievements at ALI Technologies, a company acquired by McKesson in 2002. As regional sales manager, his teams consistently exceeded sales objectives for Picture Archiving Communications Systems (PACS) software and equipment while building a ‘customers for life' culture.

Danahy was recruited by ALI in 1999 as a result of the unique attention and impact his consultative and relationship-building sales process had on several previous customers, demonstrating the primary reason his resume stood out in conversations with Medsphere.

"As a sales professional, John is a genuine asset to the customer organizations he serves," Jung added. "He understands, better than almost any sales manager I've met, that it is the responsibility of the company, as a partner, to constantly evaluate and adapt our business to the needs of the industry and partner community."

It is the agility factor—common in smaller, aggressive companies—that Danahy believes crucial to effectively serving customers and being responsive to change both in individual facilities and the industry as a whole. Where larger companies offer the perception of stability, he believes, they are often left flat-footed when the need arises to move quickly and deliberately to solve problems and adapt to the needs of customers.

"Medsphere is leading a transformation in healthcare today. By having the customer not only involved in the (development) process, but also contributing to the success of other healthcare facilities partnering with Medsphere, improved quality at a reduced cost can become a reality," Danahy said, speaking of Medsphere's Healthcare Open Source Ecosystem that takes developments from OpenVista users and incorporates them into later versions of the solution. "Our partners, the OpenVista users, should always feel like they are part of the solution instead of just a customer."

A primary responsibility of Danahy's new position will be to generate new business by leveraging Midland Memorial Hospital's designation as one of only twelve Stage 6 healthcare facilities in the U.S. Located in Midland, Texas, Midland Memorial was identified as a Stage 6 hospital by HIMSS Analytics in February 2008 for the hospital's full physician documentation and charting, and comprehensive imaging capabilities available over a secure network, both products of the OpenVista solution.

For Danahy and the sales process, a genuine asset will be the ability to point out that Midland was able to achieve Stage 6 more quickly and affordably than the other eleven designees. "A cost-sensitive solution, delivered on time and within budget, for healthcare is absolutely necessary right now," he said. "The time for Medsphere is now."

Danahy's hiring is the latest in a series that has prepared Medsphere for its next stage of development. Last October, Medsphere hired Doyle as president and CEO, replacing Dr. Kenneth W. Kizer who assumed the role of board chairman. Appointments since that time have included Richard G. (Rick) Jung as chief marketing officer (now chief operating officer), Edmund Billings, MD, as chief medical officer, and Scott McMullen as vice president of engineering.

About Medsphere and OpenVista

As a disruptive force in healthcare information technology, Medsphere is revolutionizing the industry by delivering commercially supported Open Source software based on the U.S. Department of Veterans Affairs' proven VistA EHR. The product of 20-plus years of development and more than $8 billion invested, VistA enabled the transformation of the VA into the nation's most efficient and clinically effective healthcare organization. Currently VistA contains roughly 2.1 billion clinical documents, 2.76 billion orders, and 1.51 billion images. As the commercialized version of VistA, Medsphere's OpenVista is a portfolio of products and professional services for hospitals, clinics and integrated delivery networks. OpenVista is currently used by over 20,000 individuals, including 2,500 physicians and contains hundreds of thousands of medical records. Medsphere addresses healthcare's capital constraints through an innovative business model:

  • A unique subscription-based pricing model minimizes upfront costs.
  • The Healthcare Open Source Ecosystem and Medsphere.org portal coordinate a unique grassroots community of customers/subscribers, partners and developers driving OpenVista innovation and providing a parallel development and support structure.
  • Medsphere's experienced team of healthcare technology professionals and unique suite of implementation tools deliver a fluid transition to a comprehensive healthcare information technology solution.

Founded in 2002, Medsphere is backed financially by Azure Capital Partners, Thomas Weisel Venture Partners and EPIC Ventures (formerly the Wasatch Venture Fund). Medsphere clients include Midland Memorial Hospital, Midland, Texas; West Virginia Department of Health and Human Resources (WV DHHR); Memorial Hospital of Sweetwater County, Rock Springs, Wyoming; Lutheran Medical Center, Brooklyn, New York; and the federal government's Indian Health Service. For more information, visit http://www.medsphere.com and http://www.medsphere.org.


Contacts

Corporate
Rick Jung
Chief Operating Officer
Medsphere Systems Corporation
(760) 692-3742 (office)
rick.jung@medsphere.com
Media
Lily Eng or Thea Lavin
Schwartz Communications for Medsphere
(415) 512-0770 (office)
medsphere@schwartz-pr.com
General Inquiries
info@medsphere.com