Today's Technical View on Cardinal Health and McKesson: Emerging Markets to Drive Growth for Drugs Wholesalers

Thu Feb 14, 2013 8:03am EST

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Today's Technical View on Cardinal Health and McKesson: Emerging Markets to Drive Growth
for Drugs Wholesalers

LONDON, February 14, 2013 /PRNewswire/ --

    The weak macroeconomic environment has had an impact on the pharmaceutical industry,
however, not as much as other industries. The growth for pharmaceutical wholesalers in
2013 will be driven by emerging markets. Also, the launch of new drugs and potential
blockbusters will drive growth for pharmaceutical wholesalers such as Cardinal Health
Inc. (NYSE : CAH) and McKesson Corporation (NYSE : MCK). StockCall initiated free
in-depth technical analysis on Cardinal Health and McKesson which are currently
available upon sign up at  

    http://www.stockcall.com/research  

    Emerging Markets, New Drug Launches and Potential Blockbusters to Drive Growth  

    The International Federation of Pharmaceutical Wholesalers (IFPW), which represents
a strong, effective platform to establish strategic dialogue within the worldwide
pharmaceutical community, expects average annual growth of 13% to 16% for emerging
markets (Brazil, Russia, India, China, Turkey, Mexico and Korea). These markets are
expected to account for 40% of the global market growth through 2013.  

    The IFPW believes that despite the pressures, there is still room for new drug
launches and potential blockbusters, which should drive growth for drugs wholesalers.
This year will see the launch of a number of new drugs, including products targeted at
niche uses and narrow patient populations. Overall, IFPW expects pharmaceutical market
to grow between 3% and 6% through 2013.  

    Patent Expirations  

    The pharmaceutical industry saw a number of patent expirations for blockbuster drugs
in 2012 and is likely to see more in 2013. As a result, the share of generic drugs will
continue to increase. This will have an impact on the top-line of pharmaceutical
wholesalers.  

    Cardinal Reports Strong Q2 Results  

    Last week, Cardinal Health reported strong financial results in its second quarter
of fiscal 2013. The Dublin, Ohio-based company reported second quarter revenue of $25.2
billion. The company's revenue for the pharmaceutical segment fell 8% to $22.7 billion
in the second quarter. The decline was due to non-renewal of Express Scripts contract as
well as expected conversions from branded pharmaceuticals to lower-priced generics. The
decline was partially offset by revenues from new pharmaceutical distribution customers.
Sign up for the free technical analysis on Cardinal Health Inc. at  

    http://www.StockCall.com/CAH021413.pdf  

    Cardinal Health's non-GAAP earnings for the quarter rose 15% to $0.93 per share.  

    George Barrett, Chairman and CEO of Cardinal Health, noted that the company has now
completed a strong first half to its fiscal 2013 with a good second quarter performance.
Barrett said that while continued brand-to-generic conversions and the previously
announced movement of the Express Scripts contract drove a revenue decline in the
Pharmaceutical segment, excellent performance from generic programs and new customer
wins fueled profit gains.  

    McKesson's Q3 Results  

    McKesson recently reported revenue of $31.2 billion for its third quarter ended
December 31, 2012, up 1% over the same period in the previous year. The company's
adjusted earnings per share for the quarter was $1.41, up from $1.40 per share reported
for the same period in the previous year. Download the free report on McKesson
Corporation by registering at  

    http://www.StockCall.com/MCK021413.pdf  

    John H. Hammergren, Chairman and CEO of McKesson, said that the company's full-year
view of the operating performance in its Distribution Solutions segment is now better
than its original expectations.  

    For the fiscal year ended on March 31, 2013, McKesson expects adjusted earnings to
be between $7.10 per share and $7.30 per share.  

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