PRO MEDICUS LIMITED — Capital/Financing Update 2004

Oct 17, 2004

450 Swan Street, Richmond, Victoria 3121, Australia

Telephone (03) 9429 8800 Fascimile (03) 9429 9455

www.promedicus.com.au

Agfa Deal Launches Pro Medicus into North America

• Agfa to exclusively license PME technology in US and Canada
• An estimated A$10m minimum revenue for PME during first 3 years
• Considerable upside could more than double business

Leading e-health company Pro Medicus (ASX:PME) today announced that AGFA-GEVAERT N.V. (Agfa) have signed a three-year agreement to exclusively license the Pro Medicus Practice Management and digital radiology software products to address the large and rapidly growing private imaging centre market in both the US and Canada.

The deal is expected to generate a minimum revenue of A$10 million in the first three years for Pro Medicus with considerable upside based on sales volumes.

Under the agreement, Pro Medicus will receive a percentage of software sales backed by minimum payments that increase in each of the three years. A share of ongoing maintenance fees will provide the company with a recurring revenue stream in addition to license royalties. All intellectual property rights are retained by Pro Medicus.

The products will leverage the strong brand presence Agfa has in the North American radiology markets with all marketing, implementation and end user support performed by Agfa's extensive network of over 700 Healthcare sales, services and IT professionals.

It is anticipated that costs for localising the software for the North American market will be largely covered within normal R&D expenditure for the year with all work carried out to date on the project being fully expensed. As a result, margins on revenue from this deal are expected to be comparable to those currently achieved in Australia.

Pro Medicus Managing Director Dr Sam Hupert described the agreement as a watershed for the 21-year-old medical IT company. "This deal validates our focus and strategy on a future based on our digital imaging software and builds massively on existing Australian opportunities," he said. "Our technology is being taken into a market over 20 times larger than ours by a company with an established presence and reputation second to none. Agfa is one of the biggest players in the US radiology market with huge links into the market, both from an analogue perspective $-$ it supplies film to over 40% of the market $-$ and in digital where it is also one of the biggest players. With this kind of backing we can see the potential to more than double the size of our business within the next three vears."

Around 400 million X-Ray scans are taken annually in the United States, compared to around 14 million in Australia. Imaging Centers are the fastest growing segment of the US radiology market. There are currently around 5,000 imaging centers and over 3,000 community

hospitals with standalone imaging departments with the number increasing by 12-15% annually for the past three years and this strong growth is expected to continue. Image numbers are also increasing an average of 16% per annum.

"We are extremely pleased to be chosen as Agfa's exclusive supplier to such a huge market." said Dr Hupert. "They conducted an extensive due diligence process in which they evaluated the best technologies from North America. Their choice validates our long held contention that what we have developed here in Australia is absolutely world class."

Agfa Healthcare CEO Philippe Houssiau said, "This agreement with Pro Medicus is structured to maximise the strengths of both companies and gives us a potent offering for the rapidly growing Imaging Centre market. Our imaging technology, market position and distribution channels combined with Pro Medicus' elegant software integration technology and practice management experience make for a product set designed to provide improved delivery of patient care backed with a sound business platform for the imaging centre space."

"The deal, which is huge in its own right, has the added potential to open up a raft of other overseas opportunities," said Dr Hupert. "We have leading edge technology that is applicable to other medical seaments of the North American health market as well as to other regions around the world."

For more information contact:

Dr Sam Hupert Managing Director Pro Medicus Limited email: hupert@promedicus.com.au Phone: +61 3 9429 8800 Fax: +61 3 9429 9544 www.promedicus.com.au

Mike Feehan Monsoon Communications Phone: +61 3 9620 3333

About Pro Medicus:

Pro Medicus Limited JASX: PMEI is Australia's leading medical IT and e-health provider. Founded in 1983, the company provides a full range of integrated software products and services to individual. corporate and public health providers. Over 16,000 doctors are now connected to the company's ehealth service, promedicus.net, with the number of transactions across the network between GPs and specialists growing strongly.

During 2003, Pro Medicus implemented its first overseas contract with the UK's MIA Lodestone and now has seventeen sites in the UK with opportunities for further overseas expansion.

Digital radiology, a key growth area for the company, has started to deliver strong results. Over the past few months, several important digital radiology contracts have been won, significantly across different parts of the health system - the public sector, existing and new private radiology practices and with Mayne, one of the largest corporate radiology groups in the country.

In March this year, it entered the local GP clinical desktop market with the acquisition of software technology, which is being marketed as ProMed Clinical.

About Agfa

The Agfa-Gevaert Group is one of the world's leading imaging companies. Agfa develops, manufactures and markets analogue and digital systems, intended mainly for the graphics industry, healthcare, micrographics, motion picture and photography markets.

Agfa's headquarters are in Mortsel, Belgium. The company is active in 40 countries and has 120 agents throughout the world. Together they achieved a turnover of 4,215 million euros in 2003. Product and company information can be found on Agfa's home page on the World Wide Web at: www.agfa.com