Spurred by Growth and Accomplishments, Medsphere Moves Corporate Offices to San Diego County

CARLSBAD, CA, Aug 05 (MARKET WIRE) --
Medsphere(R) Systems Corporation, the leading provider of Open Source
healthcare IT solutions, today announced the transition of corporate
headquarters from Orange County to north San Diego County. The move is
necessitated by two primary factors: recent development and persistent
demand for Medsphere OpenVista(R), the company's cost-effective Open
Source electronic health record (EHR) solution and rapid expansion of a
collaborative Open Source community -- the Healthcare Open Source
Ecosystem -- oriented around OpenVista and focused on enhancing quality
of care and increasing clinical and operational efficiencies. Medsphere's
new corporate headquarters are located at 1917 Palomar Oaks Way,
Carlsbad, California 92008.

Medsphere's move to Carlsbad enables the 87-employee company to expand its
available physical space by 50 percent and take advantage of the county's
more affordable real estate. The move will also allow Medsphere to expand
and recruit more employees from the area's substantial IT talent pool.
Medsphere joins several prominent healthcare and technology organizations
also headquartered in San Diego County, including Sharp HealthCare,
Scripps Health, Qualcomm Inc. and AT&T.

From the same time period last year, Medsphere has expanded personnel by
33 percent to accommodate increased sales activity, a demanding
development pace and support for an additional six facilities now live on
OpenVista. This growing market has been studied by business analysts at
Health Industry Insights, an IDC company, who forecasted the total EHR
provider market in the United States to grow by more than 10 percent in
2008 (Source: Health Industry Insights). Medsphere's own research
indicates that this market is growing by 15 percent annually and that
more than 85 percent remains untapped. In addition to recent
implementations, Medsphere's momentum has been spurred by strategic
partnerships that are helping the company solidify its position as a
leader in Open Source healthcare IT.

"Medsphere is experiencing widespread customer adoption, forming powerful
partnerships that expand the capabilities of our technology and hitting
our stride in terms of growth," said CEO Michael J. Doyle. "We want to do
everything possible to maintain this momentum. The move to San Diego
County enables Medsphere to recruit from a qualified pool of talent and
puts us in proximity to potential partners from healthcare and IT that
are also putting down roots in the region. As our 2008 success clearly
demonstrates, hospitals are recognizing the value of Open Source in
healthcare. We look forward to many years of success in our new location."

Ongoing Company Momentum

Earlier this month, Medsphere announced a strategic partnership for
comprehensive support of OpenVista with Irvine-based WebReach, Inc., a
premier healthcare IT consultancy and creator of Open Source health IT
solutions. The partnership enables Medsphere and WebReach to offer
hospitals an Open Source, feature-rich and commercially supported solution
that meets unique facility needs and overcomes the cost, interoperability
and complexity limitations of traditional vendor-lock EHRs.

In May, Medsphere announced the Open Source release of OpenVista Clinical
Information System (CIS) version 1.0 Beta and OpenVista Server version
1.5.86. The Open Source releases coincided with the beta implementation of
the OpenVista CIS Enterprise edition at Century City Doctors Hospital
(CCDH) in Los Angeles and effectively aligned the Open Source and
commercial versions of OpenVista. Simultaneously, Medsphere announced the
transition of both applications from the GNU General Public License (GPL)
for OpenVista Server and the Medsphere Public License (MSPL) for CIS to
version 3 of the GNU Affero General Public License (AGPL).

Medsphere also completed several successful implementations of OpenVista
in the last year at facilities operated by the West Virginia Department of
Health and Human Resources (WV DHHR), CCDH in Los Angeles, and Memorial
Hospital of Sweetwater County in Rock Springs, Wyoming. Medsphere's
current activities include OpenVista implementations at Lutheran Medical
Center in Brooklyn, New York.

In March, Medsphere announced that Midland Memorial Hospital (MMH) in West
Texas, one of the company's premier customers, joined an elite group of 13
hospitals as a Health Information Management and Systems Society (HIMSS)
Analytics Stage 6 facility, a designation recognizing established levels
of automated patient care and clinical process improvement. With
OpenVista, MMH was able to achieve Stage 6 for about one third of the
cost of other commercial systems in roughly half the implementation time
traditionally required. The announcement further validated the benefits
of OpenVista over alternative EHR solutions.

About OpenVista

OpenVista is a commercialized version of the highly acclaimed VistA EHR
created and developed by the U.S. Department of Veterans Affairs over more
than 20 years. OpenVista enables hospitals and other healthcare facilities
to reduce operating costs and improve patient care more rapidly and
inexpensively than other approaches. As a disruptive technology, OpenVista
meets the needs of acute, ambulatory, and long-term care environments, as
well as multi-facility, multi-specialty healthcare organizations, and
offers clinicians a feature-rich, user-friendly and secure environment for
accessing all critical patient information in real time.

Medsphere supports the core principles of the Open Source community and
has released the enhanced code base for the OpenVista Clinical Information
System (CIS), the EHR's core medical record application. The Open Source
release of CIS enables customers and other interested parties to use,
modify, and enhance it in support of improved processes and workflows, and
better patient safety. OpenVista is the core focus of the Healthcare Open
Source Ecosystem, a collaborative community of healthcare facilities,
developers, value-added resellers, clinicians and other interested parties
dedicated to improving patient care through Open Source tools. The
Ecosystem enables participants to develop OpenVista according to
particular needs and desires, communicate feedback, share enhancements,
and benefit from one another's work.

About Medsphere Systems Corporation

As the Open Source source for healthcare, Medsphere is revolutionizing the
industry by delivering commercially supported software based on the U.S.
Department of Veterans Affairs' proven VistA EHR. Medsphere offers
healthcare an economically sustainable and comprehensive solution in
OpenVista(R), a portfolio of products and professional services for
hospitals, clinics, and integrated delivery networks. The company
addresses the capital constraints of the healthcare industry through an
innovative subscription-based pricing model. 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). For more information, visit
http://www.medsphere.com.

Contacts

Medsphere Systems
Rick Jung
Chief Operating Officer
(949) 297-8182 office
rick.jung@medsphere.com

Media
Marisa Borgasano
Schwartz Communications for Medsphere
(415) 512-0770
medsphere@schwartz-pr.com

Copyright 2008, Market Wire, All rights reserved.

-0-