Lisle, Illinois, October 1, 2007, SXC Health Solutions, Inc. (“SXC” or the “Company”) (NASDAQ: SXCI, TSX: SXC), a leading provider of pharmacy benefits management (“PBM”) services and healthcare IT solutions to the healthcare benefits management industry, today unveiled a re-alignment plan to optimize its cost structure and enhance its growth prospects. This program is expected to generate annual cost savings of approximately $3.0 million, a portion of which will be re-deployed to support the fastest growing segments of the Company’s business.

To generate cost savings, the Company has reduced its workforce by approximately 7%. These reductions were focused on the provider and administrative segments of the business. Most of the reductions took place at the Company’s Lisle, Illinois location. SXC now employs 425 people.

“Having completed a thorough review of the business, we believe this is the right time to reduce costs in certain areas of our operations in order to focus our resources on our PBM services and transaction processing business segments, the most rapidly growing segments of the Company,” said Gordon S. Glenn, Chairman and CEO of SXC. “We believe that these re-alignment measures will allow us to deliver on our full potential and achieve our long-term revenue growth objectives and margin expansion.”

SXC will incur one-time severance costs of approximately $0.8 million, which will be reflected in the Company’s third quarter fiscal 2007 financial results. The Company expects that this charge will be partially offset by related cost savings in the fourth quarter of fiscal 2007. However, starting in the fourth quarter and into fiscal 2008, SXC intends to hire new personnel in sales and to support the areas of the business with the most promising growth opportunities, effectively re-investing a portion of the savings from the staff reductions back into the business.

In addition, the Company continues to experience higher then expected legal and professional fees related to delayed and protested contracts as well as additional receivable reserves, resulting in an additional charge in the third quarter of approximately $0.8 million. This charge and the severance cost are expected to have a combined impact of approximately ($0.05) on earnings per share (“EPS”) in 2007.

SXC is lowering its 2007 revenue guidance in two areas: 1) a reduction of $2.5-$3.0 million of system sales revenue due to continued delays in the signing of certain contracts as well as slower than expected retail pharmacy sales and implementations; and 2) the deferral of $0.4-$0.8 million in transaction processing revenue from certain informedRx contracts relative to service level objectives which may not be met in 2007. The Company believes that it will be successful signing a majority these delayed agreements and recognizing a significant portion of the deferred revenue in 2008.

SXC’s guidance for fiscal 2007 is now the following: revenue of $92-$93 million; adjusted EBITDA of $19 - 20 million; Pre-tax net income of $15.5-$16.5 million; and EPS of $0.51-$0.55. Severance costs of $0.8 million are included in the revised EPS forecast.

Mr. Glenn added: “Although we are very dissatisfied to be revising our outlook for this year, we expect to be successful with our delayed contract signings and to rebound in 2008. We remain confident that we have the right strategy and technology platform to continue to grow our market share and that the actions we are taking to re-allocate resources within the organization are essential steps to enhance our operational efficiency and to best position the Company to resume its historical growth trend.”

The Company will provide additional updates on its re-alignment plan during its third quarter 2007 conference call on November 8, 2007.

SXC Health Solutions, Inc. (SXC) is a leading provider of pharmacy benefits management (PBM) services and healthcare IT solutions to the 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 Federal, provincial, and, state and local governments, pharmacy benefit managers, managed care organizations, retail pharmacy chains and other healthcare intermediaries. SXC is based in Lisle, Illinois with locations in; Scottsdale, Arizona; Warminster, Pennsylvania; Alpharetta, Georgia; Milton, Ontario and Victoria, British Columbia. For more information please visit www.sxc.com.