Exhibit 99.1

NEOFORMA REPORTS FOURTH QUARTER AND FULL YEAR 2005

FINANCIAL RESULTS

SAN JOSE, CA – February 23, 2006 – Neoforma, Inc. (Nasdaq: NEOF), a leading provider of supply chain management solutions for the healthcare industry, generated total revenue of $35.2 million on a generally accepted accounting principles (GAAP) basis in the year ended December 31, 2005, an increase over the $12.7 million generated in the previous year due to a reduction in the level of amortization that was offset against revenue as required under Emerging Issues Task Force Abstract No. 01-9 (EITF No. 01-9). Excluding the impact of EITF No. 01-9, Neoforma generated total adjusted revenue of $72.8 million in fiscal 2005, a decrease from the $74.4 million reported in 2004.

In 2005, in accordance with GAAP, Neoforma’s net loss and net loss per share were $35.9 million and $1.81, respectively, an improvement from the $61.2 million net loss and $3.17 net loss per share recorded in the prior year. On an adjusted basis, Neoforma’s net income and net income per share were $16.6 million and $0.84, respectively, a decrease as compared to the $21.2 million net income and $1.10 net income per share recorded in 2004.

Neoforma’s adjusted financial information, which is not in accordance with GAAP, excludes the application of EITF No. 01-9 and certain expenses, gains and losses. Adjusted financial information serves as a measure of the performance of Neoforma’s ongoing core operations. A description of the adjusted financial information for the periods presented and a reconciliation of these results to GAAP financial information are included in the attached financial statements and are available in the investor relations section of Neoforma’s Web site at www.neoforma.com.

GHX Transaction

On October 10, 2005, Neoforma entered into a definitive merger agreement with Global Healthcare Exchange, LLC (GHX) for GHX to acquire Neoforma. Neoforma has scheduled a vote of its stockholders regarding the proposed transaction for March 2, 2006. If the majority of the shares that are cast and that are not held by VHA Inc., University HealthSystem Consortium (UHC) or their affiliates are voted in favor of adopting the merger agreement with GHX, the transaction is expected to close shortly thereafter, pending GHX’s receipt of anticipated debt financing. On January 23, 2006, Neoforma filed a definitive proxy statement with the Securities and Exchange Commission (SEC) in connection with the proposed transaction; the definitive

proxy statement and other information filed with the SEC are available on Neoforma’s Web site at www.neoforma.com.

Fiscal Year 2005 Financial Results

For the year ended December 31, 2005, on a GAAP basis, Neoforma generated $35.2 million in total revenue, comprised of $24.1 million in related party revenue and $11.1 million in non-related party revenue. The Company’s total revenue increased $22.5 million from the $12.7 million recognized in the previous year; in 2004, Neoforma’s total revenue was comprised entirely of non-related party revenue. The increase in related party revenue in 2005 was primarily the result of a decrease in the level of amortization that was offset against revenue as required under EITF No. 01-9.

In accordance with EITF No. 01-9, Neoforma classifies non-cash amortization of partnership costs as an offset against related party revenue, up to the lesser of the two amounts each quarter. As the reductions to operating expenses and revenue are equal within each period, the application of EITF No. 01-9 has no impact within a particular period on income or loss from operations, net income or loss, net income or loss per share or total cash flow.

In the third quarter of 2005, the amortization of partnership costs resulting from the initial shares granted to VHA and UHC in July 2000 was completed. As a result, gross amortization of partnership costs decreased to $39.1 million in 2005, a $29.1 million decrease from the $68.2 million in gross amortization of partnership costs recorded in the previous year. This decrease resulted in a reduction of $24.3 million in the amortization of partnership costs offset against related party revenue in 2005 as compared to 2004. Primarily as a result of this reduced offset, related party revenue and total revenue on a GAAP basis increased $24.1 million and $22.5 million, respectively, as compared to the prior year.

On an adjusted basis, excluding the impact of EITF No. 01-9, Neoforma generated total revenue of $72.8 million in 2005, consisting of $61.5 million in related party revenue and $11.2 million in non-related party revenue. The Company’s total, related party and non-related party revenue results, on an adjusted basis, represent decreases from the $74.4 million, $61.8 million and $12.7 million, respectively, recorded in 2004. The $1.4 million decrease in adjusted non-related party revenue, the principal cause of the decline in total adjusted revenue, was due to an $859,000 decrease in revenue from suppliers and a $561,000 decrease in other revenue. The decline in revenue from suppliers was primarily due to the cancellation, in late 2004, of a significant pharmaceutical market intelligence services contract. The decline in other revenue was due to the expiration, in the third quarter of 2004, of the ratable revenue being recognized related to a 2001 technology license sale.

In 2005, Neoforma’s GAAP operating expenses totaled $72.1 million, an improvement from the $74.3 million recorded in the previous year. The reduction in operating expenses was primarily the result of a $4.7 million decrease in amortization of partnership costs classified as an operating expense. In addition, while the Company recorded a $4.1 million write-off of stockholder notes receivable in 2004, there was no such expense recorded in 2005. These reductions in operating expenses in 2005 were partially offset by a $2.2 million increase in depreciation and amortization of property and equipment, $2.0 million in costs incurred for third-party services in connection with Neoforma’s evaluation of strategic alternatives and its proposed merger with GHX, a $1.9 million decrease in software development costs capitalized and $1.0 million of other charges incurred in 2005, including $723,000 in restructuring charges and a $284,000 write-off of software.

In fiscal 2005, adjusted operating expenses equaled $57.2 million, an increase from the $53.6 million recorded in the prior year. This increase was primarily due to $2.0 million in costs incurred with the evaluation of strategic alternatives, a $1.9 million reduction in software development costs capitalized and a $1.2 million increase in cost of services. These increases were partially offset by a $1.9 million decrease in selling and marketing expenses.

On a GAAP basis, in 2005, Neoforma’s loss from operations totaled $36.9 million, an improvement from the $61.6 million loss in the previous year. The $24.7 million improvement in the Company’s loss from operations was primarily a result of the $29.1 million decrease in gross amortization of partnership costs in 2005, as compared to 2004.

On an adjusted basis, in 2005, Neoforma generated $15.6 million in EBITDA, a decrease from the $20.8 million generated in the prior year.

As of December 31, 2005, Neoforma’s cash, cash equivalents and short-term investments totaled $44.4 million, a $5.1 million increase from the total as of the end of the third quarter of 2005 and an $18.6 million increase from the total as of year-end 2004. Neoforma remains debt-free.

Neoforma’s free cash flow in 2005 totaled $16.9 million. Free cash flow is calculated as net cash used in operating activities, plus amortization of partnership costs offset against related party revenue, minus purchases of property and equipment and capitalization of software development costs.

Fourth Quarter 2005 Financial Results

In the fourth quarter ended December 31, 2005, Neoforma generated total revenue of $17.0 million on a GAAP basis, consisting of $14.6 million in related party revenue and $2.5 million in non-related party revenue. In comparison to the same quarter of the prior year, the

Company’s total revenue results increased $13.6 million from the $3.4 million recognized in the fourth quarter of 2004; Neoforma’s total revenue was comprised entirely of non-related party revenue in the fourth quarter of 2004. The increase in related party revenue in the fourth quarter of 2005 was due to the decrease in the level of amortization that was offset against revenue as required under EITF No. 01-9.

Because the amortization of partnership costs resulting from the initial shares granted to VHA and UHC in July 2000 was completed in the third quarter of 2005, gross amortization of partnership costs decreased by $16.2 million in the fourth quarter of 2005, as compared to the same quarter in the previous year. This decrease resulted in a $14.7 million reduction in the amortization of partnership costs offset against related party revenue and was the principal reason for the $14.6 million and $13.6 million increases in Neoforma’s related party and total revenue, respectively, on a GAAP basis in the fourth quarter of 2005, as compared to the same quarter in 2004.

On an adjusted basis, excluding the impact of EITF No. 01-9, Neoforma generated total revenue of $17.8 million in the fourth quarter of 2005, consisting of $15.3 million in related party revenue and $2.5 million in non-related party revenue and representing decreases from the $18.9 million in total revenue, $15.4 million in related party revenue and $3.4 million in non-related party revenue recorded in the same period in the previous year. The $984,000 decrease in adjusted non-related party revenue, the primary reason for the $1.1 million decline in total adjusted revenue, was due to a $604,000 decrease in revenue from hospitals and group purchasing organizations, predominantly for Neoforma Data Management Solution™ (Neoforma DMS), and a $459,000 decrease in revenue from suppliers.

In the fourth quarter of 2005, Neoforma’s total GAAP operating expenses were $16.6 million, an improvement from the $18.6 million recorded in the same quarter in the prior year. Adjusted operating expenses for the fourth quarter totaled $13.6 million, an improvement from the $14.0 million in adjusted operating expenses recorded in the same quarter in 2004. In the fourth quarter of 2005, Neoforma incurred approximately $1.1 million in expenses for third-party services in connection with its proposed transaction with GHX.

On a GAAP basis, in the fourth quarter of 2005, Neoforma generated income from operations equaling $421,000, an improvement from the $15.2 million loss from operations recorded in the fourth quarter of 2004.

Neoforma generated $4.2 million in EBITDA in the fourth quarter of 2005, a decrease from the $4.9 million generated in the same period in 2004.

In accordance with GAAP, in the fourth quarter of 2005, Neoforma’s net income was $753,000, and both basic and diluted net income per share were $0.04, representing improvements from the $15.1 million net loss and $0.78 net loss per share reported in the same quarter in the previous year. In the fourth quarter of 2005, Neoforma achieved its first profit on a GAAP basis. On an adjusted basis, the Company’s net income and net income per share equaled $4.5 million and $0.22, respectively, decreasing from the $5.0 million in net income and $0.26 in net income per share recorded in the fourth quarter of 2004.

About Neoforma

Neoforma is a leading supply chain management solutions provider for the healthcare industry. Through a unique combination of technology, information and services, Neoforma provides innovative solutions to over 1,800 hospitals and suppliers, supporting approximately $15 billion in annualized marketplace volume. By bringing together contract information and order data, Neoforma’s integrated solution set delivers a comprehensive view of an organization’s supply chain, driving significant cost savings and better decision-making for both hospitals and suppliers. For more information, point your browser to http://www.neoforma.com.

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This news release contains forward-looking information within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements include, but are not limited to, the expected timing of the close of the proposed transaction with GHX. There are a number of risks that could cause actual results to differ materially from those anticipated by these forward-looking statements. These risks include the risk of the proposed transaction with GHX not closing or being delayed. Some of these risks and other risks are described in Neoforma’s periodic reports filed with the SEC, including its Form 10-Q for the quarter ended September 30, 2005, and the definitive proxy statement filed on January 23, 2006. These statements are current as of the date of this release and Neoforma assumes no obligation to update the forward-looking information contained in this news release.

Neoforma is a trademark of Neoforma, Inc. Other Neoforma logos, product names and service names are also trademarks of Neoforma, Inc., which may be registered in other countries. Other product and brand names are trademarks of their respective owners.

Contacts:

Amanda Mogin, Neoforma, investors, 408.468.4251, amanda.mogin@neoforma.com

NEOFORMA, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share amounts)

(unaudited)

	Three Months Ended December 31,						Year Ended December 31,
	2004			2005			2004			2005
REVENUE:
Related party, net of amortization of partnership costs of $15,427, $775, $61,787 and $37,457 for the three months ended December 31, 2004 and 2005 and the twelve months ended December 31, 2004 and 2005, respectively	$	—		$	14,572		$	—		$	24,068
Non-related party, net of write-off of purchase option of $140 for the twelve months ended December 31, 2005		3,437			2,453			12,659			11,100
Total revenue		3,437			17,025			12,659			35,168
OPERATING EXPENSES:
Cost of services		3,119			3,028			10,620			11,961
Operations		2,842			3,317			11,485			12,832
Product development		4,587			4,205			16,889			19,106
Selling and marketing		3,750			2,751			14,407			12,715
General and administrative		2,616			3,230			9,787			12,230
Amortization of intangibles		147			117			588			538
Amortization of partnership costs		1,573			—			6,365			1,630
Write-off of stockholder notes receivable		—			—			4,115			—
Write-down of note receivable		—			—			—			38
Write-off of software		—			—			—			284
Restructuring		—			(44	)		—			723
Total operating expenses		18,634			16,604			74,256			72,057
Income (loss) from operations		(15,197	)		421			(61,597	)		(36,889	)
OTHER INCOME (EXPENSE)		133			365			367			1,058
Income (loss) before income taxes		(15,064	)		786			(61,230	)		(35,831	)
Provision for income taxes		—			(33	)		—			(33	)
Net income (loss)	$	(15,064	)	$	753		$	(61,230	)	$	(35,864	)
NET INCOME (LOSS) PER SHARE:
Basic	$	(0.78	)	$	0.04		$	(3.17	)	$	(1.81	)
Weighted average shares — basic		19,400			20,038			19,297			19,838
Diluted	$	(0.78	)	$	0.04		$	(3.17	)	$	(1.81	)
Weighted average shares — diluted		19,400			20,592			19,297			19,838

In addition to our consolidated financial statements presented in accordance with GAAP, Neoforma, Inc. uses non-GAAP, or adjusted, measures of operating results, net income and net income per share, which are adjusted from results based on GAAP to exclude the application of EITF No. 01-9 and certain expenses, gains and losses. Neoforma management believes that the non-GAAP adjusted results provide added insight into the Company's performance by focusing on results generated by the Company's ongoing core operations. Neoforma management uses the non-GAAP adjusted results when assessing the performance of its ongoing core operations, in making resource allocation decisions and for planning and forecasting. Additionally, incentive compensation for the Company, including management, is based on results on this basis. In addition, because we historically have reported adjusted results, we believe the inclusion of comparative numbers provides consistency in our financial reporting. The non-GAAP financial measures should be considered in addition to, not as a substitute for, or superior to, the measures of financial performance prepared in accordance with GAAP. Investors are encouraged to review the reconciliation of the non-GAAP financial measures to their most directly comparable GAAP financial measures.

NEOFORMA, INC.

ADJUSTED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (1)

(in thousands, except per share amounts)

(unaudited)

	Three Months Ended December 31,					Year Ended December 31,
	2004		2005			2004		2005
REVENUE:
Related party	$	15,427	$	15,347		$	61,787	$	61,525
Non-related party		3,437		2,453			12,659		11,240
Total adjusted revenue		18,864		17,800			74,446		72,765
OPERATING EXPENSES:
Cost of services		2,628		2,499			8,583		9,791
Operations		2,123		2,585			9,126		9,964
Product development		3,897		3,478			14,951		16,148
Selling and marketing		3,252		2,337			12,841		10,986
General and administrative		2,071		2,740			8,132		10,269
Adjusted operating expenses		13,971		13,639			53,633		57,158
EBITDA		4,893		4,161			20,813		15,607
OTHER INCOME (EXPENSE)		133		365			367		1,058
Adjusted income before income taxes		5,026		4,526			21,180		16,665
Provision for income taxes		—		(33	)		—		(33	)
Adjusted net income	$	5,026	$	4,493		$	21,180	$	16,632
ADJUSTED NET INCOME PER SHARE:
Basic	$	0.26	$	0.22		$	1.10	$	0.84
Weighted average shares — basic		19,400		20,038			19,297		19,838

(1) These adjusted condensed consolidated statements of operations exclude the impact of EITF No. 01-9 and certain expenses, gains and losses. Under EITF No. 01-9, the Company offsets non-cash amortization of partnership costs against related party revenue in an amount equal to the lesser of the two in any period. Any amortization of partnership costs in excess of related party revenue in any period is classified as an operating expense. As a result of the adoption of EITF No. 01-9, the Company offset $15,427, $775, $61,787 and $37,457 of amortization of partnership costs against related party revenue in its GAAP condensed consolidated statements of operations for the three months ended December 31, 2004 and 2005 and the twelve months ended December 31, 2004 and 2005, respectively. In addition, under EITF 01-9 the Company offset a $140 write-off of a purchase option acquired from a vendor against non-related party revenue in its GAAP condensed consolidated statements of operations for the twelve months ended December 31, 2005. As reclassifications, the application of EITF No. 01-9 had no impact on income (loss) from operations, net income (loss) or net income (loss) per share. The excluded expenses, gains and losses consisted of depreciation and amortization of property and equipment, amortization of intangibles, amortization of deferred compensation, amortization of partnership costs, write-down of note receivable, write-off of stockholder notes receivable, write-off of software and restructuring.

NEOFORMA, INC.

RECONCILIATION OF ADJUSTED CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS TO GAAP

(in thousands, except per share amounts)

(unaudited)

	Three Months Ended December 31, 2005
										GAAP Allocations
	Adjusted Results			Excluded Expenses, Gains and Losses			Application of EITF No. 01-9			Depreciation and Amortization of Property and Equipment			Amortization of Deferred Compensation			GAAP Results As Reported
REVENUE:
Related party	$	15,347		$	—		$	(775	)	$	—		$	—		$	14,572
Non-related party		2,453			—			—			—			—			2,453
Total revenue		17,800			—			(775	)		—			—			17,025
OPERATING EXPENSES:
Cost of services		2,499			—			—			363			166			3,028
Operations		2,585			—			—			629			103			3,317
Product development		3,478			—			—			548			179			4,205
Selling and marketing		2,337			—			—			264			150			2,751
General and administrative		2,740			—			—			277			213			3,230
Adjusted operating expenses		13,639
EBITDA		4,161
Depreciation and amortization of property and equipment		—			2,081			—			(2,081	)		—			—
Amortization of intangibles		—			117			—			—			—			117
Amortization of deferred compensation		—			811			—			—			(811	)		—
Amortization of partnership costs		—			775			(775	)		—			—			—
Restructuring		—			(44	)		—			—			—			(44	)
Total operating expenses					3,740			(775	)		—			—			16,604
Income from operations					(3,740	)		—			—			—			421
OTHER INCOME (EXPENSE)		365			—			—			—			—			365
Income before income taxes		4,526			(3,740	)		—			—			—			786
Provision for income taxes		(33	)		—			—			—			—			(33	)
Net income	$	4,493		$	(3,740	)	$	—		$	—		$	—		$	753
NET INCOME PER SHARE:
Basic	$	0.22														$	0.04
Weighted average shares - basic		20,038															20,038
	Three Months Ended December 31, 2004
										GAAP Allocations
	Adjusted Results			Excluded Expenses, Gains and Losses			Application of EITF No. 01-9			Depreciation and Amortization of Property and Equipment			Amortization of Deferred Compensation			GAAP Results As Reported
REVENUE:
Related party	$	15,427		$	—		$	(15,427	)	$	—		$	—		$	—
Non-related party		3,437			—			—			—			—			3,437
Total revenue		18,864			—			(15,427	)		—			—			3,437
OPERATING EXPENSES:
Cost of services		2,628			—			—			274			217			3,119
Operations		2,123			—			—			565			154			2,842
Product development		3,897			—			—			433			257			4,587
Selling and marketing		3,252			—			—			242			256			3,750
General and administrative		2,071			—			—			214			331			2,616
Adjusted operating expenses		13,971
EBITDA		4,893
Depreciation and amortization of property and equipment		—			1,728			—			(1,728	)		—			—
Amortization of intangibles		—			147			—			—			—			147
Amortization of deferred compensation		—			1,215			—			—			(1,215	)		—
Amortization of partnership costs		—			17,000			(15,427	)		—			—			1,573
Total operating expenses					20,090			(15,427	)		—			—			18,634
Loss from operations					(20,090	)		—			—			—			(15,197	)
OTHER INCOME (EXPENSE)		133			—			—			—			—			133
Net income (loss)	$	5,026		$	(20,090	)	$	—		$	—		$	—		$	(15,064	)
NET INCOME (LOSS) PER SHARE:
Basic	$	0.26														$	(0.78	)
Weighted average shares - basic		19,400															19,400

NEOFORMA, INC.

RECONCILIATION OF ADJUSTED CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS TO GAAP

(in thousands, except per share amounts)

(unaudited)

	Year Ended December 31, 2005
										GAAP Allocations
	Adjusted Results			Excluded Expenses, Gains and Losses			Application of EITF No. 01-9			Depreciation and Amortization of Property and Equipment			Amortization of Deferred Compensation			GAAP Results As Reported
REVENUE:
Related party	$	61,525		$	—		$	(37,457	)	$	—		$	—		$	24,068
Non-related party		11,240			—			(140	)		—			—			11,100
Total revenue		72,765			—			(37,597	)		—			—			35,168
OPERATING EXPENSES:
Cost of services		9,791			—			—			1,420			750			11,961
Operations		9,964			—			—			2,347			521			12,832
Product development		16,148			—			—			1,994			964			19,106
Selling and marketing		10,986			—			—			975			754			12,715
General and administrative		10,269			—			—			974			987			12,230
Adjusted operating expenses		57,158
EBITDA		15,607
Depreciation and amortization of property and equipment		—			7,710			—			(7,710	)		—			—
Amortization of intangibles		—			538			—			—			—			538
Amortization of deferred compensation		—			3,976			—			—			(3,976	)		—
Amortization of partnership costs		—			39,087			(37,457	)		—			—			1,630
Restructuring		—			723			—			—			—			723
Write-down of note receivable		—			38			—			—			—			38
Write-off of software		—			284			—			—			—			284
Write-off of purchase option		—			140			(140	)		—			—			—
Total operating expenses					52,496			(37,597	)		—			—			72,057
Loss from operations					(52,496	)		—			—			—			(36,889	)
OTHER INCOME (EXPENSE)		1,058			—			—			—			—			1,058
Income (loss) before income taxes		16,665			(52,496	)		—			—			—			(35,831	)
Provision for income taxes		(33	)		—			—			—			—			(33	)
Net income (loss)	$	16,632		$	(52,496	)	$	—		$	—		$	—		$	(35,864	)
NET INCOME (LOSS) PER SHARE:
Basic	$	0.84														$	(1.81	)
Weighted average shares - basic		19,838															19,838
	Year Ended December 31, 2004
										GAAP Allocations
	Adjusted Results			Excluded Expenses, Gains and Losses			Application of EITF No. 01-9			Depreciation and Amortization of Property and Equipment			Amortization of Deferred Compensation			GAAP Results As Reported
REVENUE:
Related party	$	61,787		$	—		$	(61,787	)	$	—		$	—		$	—
Non-related party		12,659			—			—			—			—			12,659
Total revenue		74,446			—			(61,787	)		—			—			12,659
OPERATING EXPENSES:
Cost of services		8,583			—			—			1,387			650			10,620
Operations		9,126			—			—			1,936			423			11,485
Product development		14,951			—			—			1,040			898			16,889
Selling and marketing		12,841			—			—			622			944			14,407
General and administrative		8,132			—			—			554			1,101			9,787
Adjusted operating expenses		53,633
EBITDA		20,813
Depreciation and amortization of property and equipment		—			5,539			—			(5,539	)		—			—
Amortization of intangibles		—			588			—			—			—			588
Amortization of deferred compensation		—			4,016			—			—			(4,016	)		—
Amortization of partnership costs		—			68,152			(61,787	)		—			—			6,365
Write-off of stockholder notes receivable		—			4,115			—			—			—			4,115
Total operating expenses					82,410			(61,787	)		—			—			74,256
Loss from operations					(82,410	)		—			—			—			(61,597	)
OTHER INCOME (EXPENSE)		367			—			—			—			—			367
Net income (loss)	$	21,180		$	(82,410	)	$	—		$	—		$	—		$	(61,230	)
NET INCOME (LOSS) PER SHARE:
Basic	$	1.10														$	(3.17	)
Weighted average shares - basic		19,297															19,297

NEOFORMA, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except per share amounts)

(unaudited)

	December 31, 2004			December 31, 2005
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	13,277		$	31,115
Short-term investments		12,593			13,312
Accounts receivable, net of allowance for doubtful accounts		2,898			2,546
Related party accounts receivable		5,250			—
Prepaid expenses and other current assets		2,983			2,674
Total current assets		37,001			49,647
PROPERTY AND EQUIPMENT, net		11,501			9,268
INTANGIBLES, net		1,434			896
GOODWILL		1,652			1,652
CAPITALIZED PARTNERSHIP COSTS, net		40,996			1,909
RESTRICTED CASH		1,020			1,020
OTHER ASSETS		845			366
Total assets	$	94,449		$	64,758
LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES:
Accounts payable	$	3,994			2,468
Accrued payroll		3,974			5,523
Other accrued liabilities		2,839			3,729
Deferred revenue, current portion		1,564			1,424
Total current liabilities		12,371			13,144
DEFERRED RENT		387			94
DEFERRED REVENUE, less current portion		326			190
Total liabilities		13,084			13,428
STOCKHOLDERS’ EQUITY:
Common Stock $0.001 par value:
Authorized — 300,000 shares at December 31, 2005 Issued and outstanding: 20,244 and 20,733 shares at December 31, 2004 and 2005, respectively		20			21
Additional paid-in capital		839,307			842,936
Notes receivable from stockholders		(225	)		(93	)
Deferred compensation		(3,775	)		(1,656	)
Unrealized loss on available-for-sale securities		(25	)		(77	)
Accumulated deficit		(753,937	)		(789,801	)
Total stockholders’ equity		81,365			51,330
Total liabilities and stockholders’ equity	$	94,449		$	64,758

NEOFORMA, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

(all items unaudited)

	Year Ended December 31,
	2004			2005
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(61,230	)	$	(35,864	)
Adjustments to reconcile net loss to net cash used in operating activities:
Provision for doubtful accounts		122			188
Accrued interest receivable on stockholder notes receivable		(15	)		(7	)
Depreciation and amortization of property and equipment		5,539			7,710
Amortization of intangibles		588			538
Amortization of partnership costs classified as an operating expense		6,365			1,630
Amortization of deferred compensation		4,016			3,976
Write-off of stockholder notes receivable		4,115			—
Write-down of note receivable		—			38
Restructuring		—			723
Write-off of software		—			284
Change in assets and liabilities:
Accounts receivable		(4,038	)		5,414
Prepaid expenses and other current assets		(208	)		271
Other assets		614			479
Accounts payable		648			(907	)
Accrued liabilities and accrued payroll		(759	)		1,613
Deferred revenue		(1,315	)		(276	)
Deferred rent		(80	)		(190	)
Net cash used in operating activities		(45,638	)		(14,380	)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of marketable investments		(15,512	)		(8,658	)
Proceeds from the sale or maturity of marketable investments		9,531			7,887
Purchases of property and equipment		(3,239	)		(2,394	)
Capitalization of software development costs		(5,656	)		(3,805	)
Net cash used in investing activities		(14,876	)		(6,970	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Amortization of partnership costs offset against related party revenue		61,787			37,457
Cash received related to options exercised		836			598
Proceeds from the issuance of common stock under the employee stock purchase plan		1,090			961
Common stock repurchased, net of notes receivable issued to common stockholders		(177	)		—
Collections of notes receivable from stockholders		274			172
Net cash provided by financing activities		63,810			39,188
Net increase in cash and cash equivalents		3,296			17,838
Cash and cash equivalents, beginning of period		9,981			13,277
Cash and cash equivalents, end of period	$	13,277		$	31,115