Systems Xcellence Announces Four-Year $5.0 Million Transaction Processing Agreement

MILTON, Ontario August 24, 2005, Systems Xcellence Inc., (“SXC” or the “Company”) (TSX: SXC) a leading provider of healthcare information technology solutions throughout the pharmaceutical supply chain, announces a transaction processing agreement with a pharmacy benefit manager (“PBM”) based in the U.S. Midwest that provides national coverage. All figures are in U.S. dollars.

Under terms of the agreement, SXC will be the PBM’s outsourced provider of prescription drug claims processing and certain related InformedRx services from its data center in Lombard, Illinois. SXC’s services, which are expected to commence in the fourth quarter of 2005, will be delivered over a four-year period in return for consideration of approximately $5.0 million, payable on a per transaction basis. The agreement also includes a three-year renewal option for the PBM. Pricing for this agreement has been uniquely structured such that, after the first three years of the agreement, the PBM will have the option to acquire the balance of a license for certain SXC applications including RxCLAIM, RxTRACK and RxPORTAL.  Also under the agreement, the PBM will have the option to purchase other SXC services, including processing of Medicare Part D claims beginning in 2006.

“The unique structure of this agreement is one of the benefits of being able to provide our software and services on both an outsourced or license basis,” said Gordon S. Glenn, President and CEO of SXC. “We believe the majority of our contracts moving forward will fall under the category of our traditional transactions processing model, however, we will continue to work to ensure we provide our products and services in a manner that best suits our customers’ needs.”

“This PBM was drawn to SXC for several key reasons,” added Mike Meyer, SVP Sales & Marketing of SXC. “First, our products and services will provide the PBM with more flexibility and control in terms of how it structures pharmaceutical benefit plans for each of its customers; second, the PBM will now have quick turnaround when it wants to implement a change to one of its benefit plans; third, they will have real-time access to data generated by the processing of the prescription claims; and finally, the PBM will ultimately have the option of either running the system in-house or continuing to use our claims processing center.”

About RxCLAIM®, RxTRACK® and RxPORTAL^TM

RxCLAIM is an on-line transaction processing system designed to provide instant on-line adjudication of third party prescription drug claims at the point of service, including trouble-free claims management and cost-effective review, as well as payment and billing support and real-time functionality for updating benefit, price, member, provider and drug details. Providing full flexibility and control, RxCLAIM facilitates the real-time processing of pharmacy claims and payments against eligibility, plan benefits, formularies, price, DUR/DUE, prior-authorization, and rebates.

RxTRACK is a multi-level, highly versatile reporting decision support tool that converts on-line transaction processing information into useable decision-making data.

RxPORTAL extends the point of contact for a healthcare organization direct to the plan member using a web presence. It enables plan members to review complete information of their group and prescription benefit plan; search a drug database for detailed pharmaceutical information; identify which drugs are covered under their plans; determine what their co-payment will be for a particular prescription; and, locate the nearest pharmacy that is part of the member's network.

About InformedRx^TM

InformedRx is a broad suite of à la carte pharmacy benefit administrative services that provide a flexible and cost-effective alternative to traditional pharmacy benefit management offerings typically employed by managed care organizations. InformedRx is built around SXC's industry leading pharmacy claims processing system, RxCLAIM® and features pricing on a fee-for-service basis. RxCLAIM is a transaction processing system designed to provide instant on-line adjudication of third party prescription drug claims at the point of service, including trouble-free claims management and cost-effective review, as well as payment and billing support and real-time functionality for updating benefit, price, member, provider and drug details.

About Systems Xcellence Inc.

Systems Xcellence (SXC) is headquartered in Milton, Ontario with offices and processing centres in Lombard, Illinois, Warminster, Pennsylvania, Scottsdale, Arizona and Victoria, British Columbia.  Through its SXC Health Solutions, Inc subsidiary, SXC is a leading provider of healthcare information technology solutions and services to the U.S. healthcare benefits management industry. The company’s product offerings and solutions combine a wide range of software applications, application service provider (ASP) processing services and professional services, designed for many of the largest organizations in the pharmaceutical supply chain, such as pharmacy benefit managers, managed care organizations, independent, chain and mail-order pharmacies and other healthcare intermediaries. SXC can be found on the Internet at www.sxc.com.

This press release contains forward-looking statements based on current expectations. These forward-looking statements entail various risks and uncertainties that could cause actual results to differ materially from those reflected in these forward-looking statements. Risks and uncertainties about the Company's business are more fully discussed in the Company's Annual Information Form.

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