DAOU Systems Inc. Announces Larry Grandia as New President.

SAN DIEGO--(BW HealthWire)--Feb. 25, 1999--DAOU Systems Inc. (Nasdaq:DAOU) announced today that it has appointed Larry Grandia as its new president.

Grandia was previously corporate vice president and chief information officer of Intermountain Health Care, Salt Lake City, Utah (IHC). Grandia takes over the responsibility as president on March 15, 1999 from Daniel Daou, who will become vice chairman of the board, and will continue in his role of guiding the strategic direction of the company.

"Larry knows the business. He knows the issues. He knows everyone in the industry too. He's been involved with DAOU for 4 years. In his new role, he will have a staff of over 700 professionals to address the challenges the healthcare industry faces before and beyond Y2K. While Grandia is one of the most respected CIOs in the business, he is also a businessman and great leader. IHC is a two billion dollar IDN with over 22,000 employees. Larry led the information technology organization, with over 600 employees and a budget of $50 million, successfully. He will now be able to help his former peers and all of our customer base with real life solutions," stated Georges Daou, chairman of the board and chief executive officer of DAOU Systems Inc.

"We have spent the past two years implementing our vision of becoming the single source for value-added healthcare information technology solutions. We were successful through our M&A strategy and now need to focus on integration and internal growth. I am confident that Larry Grandia is just the right leader to take the new DAOU to the next step. I look forward to working with him and the entire management team to take the company to the next level," stated Daniel Daou.

Grandia stated, "I am very excited about DAOU and my new role with DAOU's customers, shareholders and employees. Frankly, what's not to get excited about DAOU? Georges and Daniel Daou had the vision years ago to create a company whose services would be where the industry is now... and to their credit, they have continued to focus on the future. It is an honor to be associated with DAOU. I am committed to help bring the greatest value and unquestioned integrity to our customers."

Among Larry Grandia's many distinctions are, 1992 John Gall HIMSS CIO of the year award, CHIME Fellow, HIMSS Fellow and Founding Advisory Board Member of Microsoft Healthcare Users Group. Grandia has headed up the DAOU CIO Advisory Board for the past three years and joined the Board of Directors in June of 1998.

DAOU Systems Inc. is a provider of integrated Information Technology (IT) solutions and services to the U.S. healthcare industry. DAOU's capabilities range from up-front strategic consulting to IT system design, implementation and long-term tactical support. DAOU's IT offerings include data, voice and video networking, applications consulting and implementation, as well as operational and Internet solutions.

DAOU has over 700 employees, and has provided services to more than 1,300 healthcare organizations, including many of the nation's top 100 integrated delivery systems. DAOU's clients include organizations such as the Cleveland Clinic, Mercy Health Services and Saint Barnabas Health Care. More information about DAOU Systems can be found at www.daou.com on the World Wide Web.

Except for the historical information contained herein, the matters discussed in this press release are forward-looking statements that involve numerous risks and uncertainties. The company's actual results could differ materially from those projected in such forward-looking statements and will depend upon a number of factors, including those discussed in the company's filings with the Securities Exchange Commission and other press releases of the company.