Leading distributor of pharmaceuticals and medical supplies Cardinal Health (CAH) recently revealed that it strives to persuade its retail pharmacy clients to disseminate knowledge among patients about new Medicare options and benefits as per the Patient Protection and Affordable Care Act, beginning in 2013.
The Department of Health and Human Services, prior to the Medicare open enrollment season starting from October 15, 2012, has provided a large amount of literature to educate patients about new benefits such as yearly wellness trips. Cardinal Health is circulating such literature among a few hundred pharmacy locations and over 7,500 stand-alone pharmacies.
In addition, Cardinal Health holds web-based sessions for its retail pharmacy clients. These sessions aim to ensure that pharmacists are knowledgeable about the literature provided to them. They strengthen the pivotal role played by pharmacists in inculcating patient awareness about Medicare options.
More information about the educational endeavor may be obtained from the CMS web site.
Cardinal Health is ranked among Fortune 500 companies. With over $100 billion in annual sales, Cardinal Health remains one of the largest distributors of pharmaceuticals and medical supplies in the U.S. The company’s diversified product portfolio may partly insulate it from the current economic uncertainty.
The company stands to gain from the gradual shift in mix from bulk to the higher-margin non-bulk sector of the Pharmaceutical segment. It is also riding the generic wave. Overall, Cardinal benefits from a spate of tuck-in acquisitions and capital deployment strategies.
However, the company faces tough competition across all business segments, which may continue to pressure pricing and margins. Its major competitors in the pharmaceutical supply chain segment include McKesson Corp. (MCK) and AmerisourceBergen Corp. (ABC).
We have a long-term Neutral recommendation on Cardinal. The stock currently retains a Zacks #3 Rank, which translates into a short-term Hold rating.
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