07.29.15
$11 Billion
KEY EXECUTIVES:
George S. Barrett, Chairman & CEO
Nick Augustinos, Sr. VP, Health Information Services & Strategy
Donald M. Casey Jr., CEO, Medical Segment
Mike Duffy, President, Medical Products
Steve Inacker, President, Hospital Sales and Services
Mike Kaufmann, Chief Financial Officer
Craig S. Morford, Chief Legal & Compliance Officer
Patty Morrison, Exec. VP, Customer Support Services & Chief Information Officer
Bill Owad, Sr. VP, Operational Excellence
Michael Petras, President, Cardinal Health at Home
NO. OF EMPLOYEES: 34,000
GLOBAL HEADQUARTERS: Dublin, Ohio
Talk about starting with a bang. Fiscal year 2014 was an important one for Cardinal Health—one that, some would say, proved its mettle. The company, which divides its business into Pharmaceutical and Medical segments, took a major hit on the pharmaceutical side with the loss of its behemoth Walgreen Co. contract in August 2013 (the company’s fiscal year 2014 began July 1, 2013). But as it lost its second largest customer, Cardinal also managed to secure a 10-year contract with Walgreen rival CVS Caremark. According to Forbes, the joint venture will source and negotiate generic supply contracts for both Cardinal Health and CVS Caremark. Good news indeed for Cardinal, as pharmaceuticals make up the vast majority of its revenue stream—$80 billion out of the $91 billion total revenues for fiscal year 2014.
“We made significant progress on our strategic priorities: launching the largest generic purchasing entity in the United States through our joint venture with CVS Caremark, expanding our position and capabilities in specialty, substantially increasing our line of consumable medical products, taking significant steps to enhance our program on physician preference items in both cardiovascular and orthopedics, enlarging our footprint in the home, and showing continued strong growth in China,” said Chairman and CEO George Barrett.
In fiscal year 2014, the company generated $2.5 billion in operating cash flow and returned $1.1 billion to shareholders through dividends and share buybacks. Barrett called China an “outstanding growth story” in Cardinal’s annual report, with the company growing revenues in the region by 30 percent, reaching $2.6 billion. This growth includes both the pharmaceutical and medical device businesses. China is Cardinal’s main market outside the United States and Canada.
“We enter fiscal year 2015 well-positioned to address the needs of a rapidly changing healthcare system,” added Barrett.
Milestones
The Medical business fared well in 2014, flourishing without nearly as much theatrics as its Pharmaceutical sister. Bringing in $10.9 billion in FY14, Medical segment revenues grew 9 percent over the previous year and segment profits grew 19 percent at $444 million. The favorable numbers are a reflection of the benefit of Cardinal’s major 2013 acquisition, Ohio-based AssuraMed, maker of home-based medical supplies to treat diabetes, incontinence, respiratory conditions, urological disorders, wounds and other chronic ailments. AssuraMed contributed $816 million for 2014 revenues, Cardinal reports. The company now is known as the Cardinal Health at Home division within the Medical segment.
“As we indicated at the time of the acquisition, we intended to increase the AssuraMed portfolio,” Barrett said in the annual financial report. “We have, in fact, broadened the product line as well as increased the number of Cardinal Health branded products to this important channel of the home. All told, we are extremely pleased with the progress here and the fact that AssuraMed exceeded our articulated full-year, non-GAAP (generally accepted accounting principles) earnings per share accretion target of $0.18 per share.”
The major acquisition for FY 2014 was Santa Clara, Calif.-based maker of vascular closure devices, AccessClosure Inc. The buy was valued at $320 million, and the transaction was funded with cash on hand.
“We’re excited about the AccessClosure acquisition, because it’s another great example of innovating to provide solutions and cost savings to the healthcare industry,” said Don Casey, CEO of Cardinal Health’s Medical Segment. “This acquisition is aligned to the company’s targeted growth areas, and we’re looking forward to similar opportunities for further expansion.”
Following this purchase, Cardinal was able to celebrate the 2 millionth shipment of AccesClosure’s Mynx vascular closure device in June 2014, just before the fiscal year ended.
“We are gratified to see that Mynx has generated such a strong response,” said Shaden Marzouk, vice president of clinical affairs at Cardinal Health. “We believe the success of Mynx in the marketplace is a result of its unique combination of innovative design, outstanding outcomes and cost effectiveness.”
Cardinal Health did not receive any medical device regulatory milestones in FY14, but the company did release two different medical products. In September 2013, the company unveiled the 2-Bin Kanban solution, an inventory management for clinical settings; and in October 2013, the Cardinal Health Surgical Clipper was released.
People News
In the beginning of FY14, Cardinal Health said goodbye to a company veteran of four decades, Tony Caprio. Caprio held the title of executive vice president in the Office of Customer Experience (OCE) and general manager for the Healthcare IQ business partnership when he announced his retirement in August 2013. In his role with the Cardinal Health Office of Customer Experience, Caprio oversaw the Cardinal Health strategy and integrated offerings to hospitals and Integrated Delivery Networks. Prior to his role in the OCE, Caprio served in a series of increasingly responsible sales positions. He began his 37-year career with Cardinal Health in sales for American Hospital Supply.
Upon Caprio’s retirement, Taylor Smith transitioned into the role of senior vice president of Enterprise Sales in the Office of Customer Experience, where he took responsibility for leading the Enterprise Sales team and managing the strategic relationship with Healthcare IQ, Cardinal’s informatics offering that provides analytics and comparative data for the decision-support of operational, financial and clinical challenges within healthcare systems. Before his new role, Smith served as the company’s senior vice president and general manager of Orthopedic Solutions.
Also during fiscal 2014, Chief Financial Officer Jeffrey W. Henderson announced his intention to retire in 2015. He has been succeeded by Mike Kaufmann, who has served in the role of CEO of Cardinal Health’s Pharmaceutical segment since 2009. He joined Cardinal Health in 1990 and held a number of senior operational, sales and finance positions. These positions included group president of the medical business of the former Healthcare Supply Chain segment, after serving as the segment’s CFO.
KEY EXECUTIVES:
George S. Barrett, Chairman & CEO
Nick Augustinos, Sr. VP, Health Information Services & Strategy
Donald M. Casey Jr., CEO, Medical Segment
Mike Duffy, President, Medical Products
Steve Inacker, President, Hospital Sales and Services
Mike Kaufmann, Chief Financial Officer
Craig S. Morford, Chief Legal & Compliance Officer
Patty Morrison, Exec. VP, Customer Support Services & Chief Information Officer
Bill Owad, Sr. VP, Operational Excellence
Michael Petras, President, Cardinal Health at Home
NO. OF EMPLOYEES: 34,000
GLOBAL HEADQUARTERS: Dublin, Ohio
Talk about starting with a bang. Fiscal year 2014 was an important one for Cardinal Health—one that, some would say, proved its mettle. The company, which divides its business into Pharmaceutical and Medical segments, took a major hit on the pharmaceutical side with the loss of its behemoth Walgreen Co. contract in August 2013 (the company’s fiscal year 2014 began July 1, 2013). But as it lost its second largest customer, Cardinal also managed to secure a 10-year contract with Walgreen rival CVS Caremark. According to Forbes, the joint venture will source and negotiate generic supply contracts for both Cardinal Health and CVS Caremark. Good news indeed for Cardinal, as pharmaceuticals make up the vast majority of its revenue stream—$80 billion out of the $91 billion total revenues for fiscal year 2014.
“We made significant progress on our strategic priorities: launching the largest generic purchasing entity in the United States through our joint venture with CVS Caremark, expanding our position and capabilities in specialty, substantially increasing our line of consumable medical products, taking significant steps to enhance our program on physician preference items in both cardiovascular and orthopedics, enlarging our footprint in the home, and showing continued strong growth in China,” said Chairman and CEO George Barrett.
In fiscal year 2014, the company generated $2.5 billion in operating cash flow and returned $1.1 billion to shareholders through dividends and share buybacks. Barrett called China an “outstanding growth story” in Cardinal’s annual report, with the company growing revenues in the region by 30 percent, reaching $2.6 billion. This growth includes both the pharmaceutical and medical device businesses. China is Cardinal’s main market outside the United States and Canada.
“We enter fiscal year 2015 well-positioned to address the needs of a rapidly changing healthcare system,” added Barrett.
Milestones
The Medical business fared well in 2014, flourishing without nearly as much theatrics as its Pharmaceutical sister. Bringing in $10.9 billion in FY14, Medical segment revenues grew 9 percent over the previous year and segment profits grew 19 percent at $444 million. The favorable numbers are a reflection of the benefit of Cardinal’s major 2013 acquisition, Ohio-based AssuraMed, maker of home-based medical supplies to treat diabetes, incontinence, respiratory conditions, urological disorders, wounds and other chronic ailments. AssuraMed contributed $816 million for 2014 revenues, Cardinal reports. The company now is known as the Cardinal Health at Home division within the Medical segment.
“As we indicated at the time of the acquisition, we intended to increase the AssuraMed portfolio,” Barrett said in the annual financial report. “We have, in fact, broadened the product line as well as increased the number of Cardinal Health branded products to this important channel of the home. All told, we are extremely pleased with the progress here and the fact that AssuraMed exceeded our articulated full-year, non-GAAP (generally accepted accounting principles) earnings per share accretion target of $0.18 per share.”
The major acquisition for FY 2014 was Santa Clara, Calif.-based maker of vascular closure devices, AccessClosure Inc. The buy was valued at $320 million, and the transaction was funded with cash on hand.
“We’re excited about the AccessClosure acquisition, because it’s another great example of innovating to provide solutions and cost savings to the healthcare industry,” said Don Casey, CEO of Cardinal Health’s Medical Segment. “This acquisition is aligned to the company’s targeted growth areas, and we’re looking forward to similar opportunities for further expansion.”
Following this purchase, Cardinal was able to celebrate the 2 millionth shipment of AccesClosure’s Mynx vascular closure device in June 2014, just before the fiscal year ended.
“We are gratified to see that Mynx has generated such a strong response,” said Shaden Marzouk, vice president of clinical affairs at Cardinal Health. “We believe the success of Mynx in the marketplace is a result of its unique combination of innovative design, outstanding outcomes and cost effectiveness.”
Cardinal Health did not receive any medical device regulatory milestones in FY14, but the company did release two different medical products. In September 2013, the company unveiled the 2-Bin Kanban solution, an inventory management for clinical settings; and in October 2013, the Cardinal Health Surgical Clipper was released.
People News
In the beginning of FY14, Cardinal Health said goodbye to a company veteran of four decades, Tony Caprio. Caprio held the title of executive vice president in the Office of Customer Experience (OCE) and general manager for the Healthcare IQ business partnership when he announced his retirement in August 2013. In his role with the Cardinal Health Office of Customer Experience, Caprio oversaw the Cardinal Health strategy and integrated offerings to hospitals and Integrated Delivery Networks. Prior to his role in the OCE, Caprio served in a series of increasingly responsible sales positions. He began his 37-year career with Cardinal Health in sales for American Hospital Supply.
Upon Caprio’s retirement, Taylor Smith transitioned into the role of senior vice president of Enterprise Sales in the Office of Customer Experience, where he took responsibility for leading the Enterprise Sales team and managing the strategic relationship with Healthcare IQ, Cardinal’s informatics offering that provides analytics and comparative data for the decision-support of operational, financial and clinical challenges within healthcare systems. Before his new role, Smith served as the company’s senior vice president and general manager of Orthopedic Solutions.
Also during fiscal 2014, Chief Financial Officer Jeffrey W. Henderson announced his intention to retire in 2015. He has been succeeded by Mike Kaufmann, who has served in the role of CEO of Cardinal Health’s Pharmaceutical segment since 2009. He joined Cardinal Health in 1990 and held a number of senior operational, sales and finance positions. These positions included group president of the medical business of the former Healthcare Supply Chain segment, after serving as the segment’s CFO.