To Our Shareholders

Welcome to Greenway Medical Technologies’ first annual report to shareholders as a public company. We successfully completed our initial public offering in February 2012, an important milestone in the progression of our Company, an organization of creative and talented innovators who continue to successfully execute on our strategy to deliver advanced solutions and industry-leading service to providers of health services delivered in rapidly evolving ambulatory care settings.

I’m pleased to report that Greenway made excellent progress in that strategy during fiscal 2012, which ended June 30. Revenue increased by 38 percent from the prior year and is growing at a compound rate of 37 percent over the past three years. Our efforts to improve our platform through innovative solutions, coupled with more efficient management of our organization, are yielding significantly improving profitability metrics.

These financial results, and the returns we generate for our shareholders, are the result of the enviable position we have established within the health information technology sector. Through our PrimeSUITE platform, we believe we are offering the right solutions for ambulatory care providers. It’s a solution recognized for ease of use; one that is delivered with a level of service that leads to consistently high customer retention rates and that is receiving growing interest from those organizations shaping new ways for ambulatory care to be delivered to an increasingly more-engaged healthcare consumer.

This enviable position is the product of our deliberate approach to how we have managed our business since we were founded in 1998. Service and Innovation drive our Growth, and it’s all made possible because of the efforts of our people, our Human Capital.

In fact, our first annual report introduces investors to Greenway along these four areas of Service, Innovation, Growth and Human Capital. Using cross-functional teams, we’re constantly developing new technologies through our Innovation platform, advancing our Service culture through the “Greenway Experience” as a long-term partnership with our customers, and achieving Growth by identifying new markets and expanding opportunities where our solutions, and our approach to service, are in demand. It’s a recipe with a secret ingredient: our Human Capital. It’s an intangible, certainly, but we achieve returns on our investment by developing our talent in ways that will enhance our innovation, improve service, and lead to additional growth.

For Greenway, our focused efforts have come together in our PrimeSUITE platform at what we believe to be the right time. It’s a time of enlightenment when there’s an emerging understanding of the value of gathering information at the point of care to improve outcomes for a particular patient, as well as for all patient encounters that will follow. It’s a time when new payment regimes will reward those providers who demonstrate, through objective measures, that they are contributing to the health of all of their patients in a cost-effective manner. It’s a time when patients are making a transition, emerging as consumers of healthcare and seeking transparency in both outcomes and pricing as they make decisions about their care.

At the forefront of our strategy are three trends we believe will shape the future of healthcare, ultimately turning the small pools of information that exist today into streams of data that will flow in a way that leads to better healthcare choices by consumers and better healthcare decisions by those professionals providing care. We call this data liquidity, and it’s cascading toward a better, more informed healthcare system.

These trends are:

• The electronification of ambulatory care, a movement that has accelerated in recent years through incentive programs and the establishment of meaningful use standards;
• Increasing consumerism in healthcare as patients are responding to increased financial responsibility by looking for measures to help them understand the cost and quality of care that they’re receiving; and
• Efforts to improve patient population health, which will result from the aggregation of data, the creation of feedback loops to providers, and increased engagement from consumers in how their care is being rendered.

These are the trends that have driven adoption of electronic health records by physicians over the past several years. They are inevitable trends that convert this nation’s current approach to healthcare delivery, which is complex and disjointed, into a more-cohesive patient-centered system. Greenway’s flexible solutions, delivered on the PrimeSUITE platform, comprise a powerful vessel for advancing care in this nation.

Our platform is also proving to be nimble, adapting to this transformational delivery system.

The market for electronic health records has historically focused on traditional providers of ambulatory care—physicians and advanced practitioners working closely with physicians.

Within this market definition, there are two categories for considerable growth:

• First-time buyers of electronic health records, a segment that we believe is slightly more than halfway penetrated; and
• A growing replacement market for electronic health records as providers must meet increasingly more rigorous standards, including consumer engagement and interoperability across the healthcare sector, in order to achieve meaningful use of their system. The estimated size of the replacement market is from one-third to as much as one-half of those providers who currently have an EHR.

These are the opportunities within the physician market. But we believe that defining the market by the traditional channels alone ignores significant opportunities that are emerging for PrimeSUITE. Greenway is not ignoring these markets.

The ambulatory market—traditionally physician offices or clinics outside of a hospital, or acute-care setting—is rapidly changing, and these changes are driven by a number of factors, including:

• A growing physician shortage, which will make access to care more difficult;
• Population demographics, particularly aging baby-boomers who will consume more healthcare services in the future;
• Initiatives to expand coverage; and
• Increasing demand for primary care services in recognition of the value of preventive medicine and early detection of conditions.

Combined, these trends will place more emphasis on the front line of care, the ambulatory market, and particularly the delivery of primary and preventive care services. This is the area of medicine that can have the greatest impact on quality of life—identifying and treating conditions before they escalate—and as a consequence has the greatest opportunity to shift the cost curve, to generate real savings. It will be accomplished by the adoption of information systems that will lead to a smarter and more efficient healthcare delivery system.

This is a societal challenge, one in which the solutions are rolling out today. Greenway is part of a wave of organizations that are meeting this increased demand by investing in new preventive and primary care delivery systems.

Take Care Health Systems, for example, is managing primary care clinics at work sites, serving as a front line in accessing the system. During fiscal 2012, we completed the deployment of PrimeSUITE to all of Take Care Health Systems’ 92 employer group sites, a total of 68 unique corporate clients that include Microsoft, Cisco, Qualcomm, Disney, HP and Intel.

Take Care is a subsidiary of Walgreens, the nation’s largest drugstore chain. Walgreens is in the process of deploying our PrimeSUITE platform to its almost 8,000 stores in the U.S. through its WellHealth EHR, powered by Greenway, for immunizations and health testing.

The market acceptance of our flexible suite of solutions in a variety of settings—from solo practitioner to enterprise systems to community health centers and rural health center providers to pioneering solutions within ambulatory care—all point to the power of our platform.

It’s a platform that is ready for where healthcare information systems will be in the future—inter-connected data that is delivered to providers and consumers wherever decisions impacting their care are being made, regardless of the platform they’re using at the time of care. This is our vision for data liquidity. It’s a vision of leadership.

We recently completed Cerner’s Interoperability Certification Program for our PrimeSUITE platform, achieving Gold Certified Network Partner status. We’re also the first ambulatory EHR to incorporate standards-based interoperability with Epic Systems, another leader of acute care solutions, and we have an interoperability relationship with McKesson’s Relay Health. This market-leading position makes it possible for us to develop leverageable interoperability solutions for our customers, as well as for a growing number of prospects concerned with the ability of their existing system to connect across the broad healthcare community.

Our vision includes the development of business services that will help our customers to adapt to new payment methods, and will allow them to improve care by participating in clinical research.

During fiscal 2013, our clinically driven revenue cycle management solution, Prime RCM, moves from beta to full-scale operation. This flexible RCM solution is a powerful technology driven by a rules engine, coupled with services to improve collected revenue for provider groups. At the same time, it is responsive to new payment regimes that will replace volume-based fee-for-service with reimbursement based on how effectively providers are managing the quality of care they’re rendering.

Our providers are beginning to embrace our PrimeRESEARCH platform, which is driven by PrimeSUITE. At the end of fiscal 2012, Greenway customers were using PrimeSUITE to enroll patients in 10 clinical trials. More than one-half of our PrimeSUITE base has now opted in to PrimeRESEARCH, creating opportunities for us to partner with life sciences companies to accelerate the learning curve for new treatments.

We are excited about the prospects for our organization and the contributions that we can make in improving our healthcare system.

We are partnered with those who share a vision for smarter healthcare, for healthcare that is connected across providers, across ambulatory and acute care delivery, for healthcare that will evolve to become a true system. We believe that information, effectively presented, will empower providers to improve care.

We appreciate the opportunity provided by all of our shareholders to support our vision, and to make possible the execution of our strategy.

Wyche T. Green, III
President and Chief Executive Officer