About Cardinal Health Systems, Inc.
When your local pharmacy runs low on drugs or supplies, it might just call Cardinal Health. The company is a top distributor of pharmaceuticals and other medical supplies and equipment in the US. Its pharmaceutical division provides supply chain services including branded, generic, and specialty pharmaceutical and OTC drug distribution. It also franchises Medicine Shoppe and Medicap Pharmacy retail pharmacies. Cardinal's medical division parcels out medical, laboratory, and surgical supplies. Customers include retail pharmacies, hospitals, health care systems, surgery centers, nursing homes, doctor's offices, clinical labs, and other health care businesses. The US accounts for the majority of Cardinal's sales.
Cardinal Health operates through two primary segments -- Pharmaceutical and Medical.
Pharmaceutical distribution, primarily to pharmacy customers across the US, accounts for more than 95%% of Cardinal Health's sales. Through its Specialty Solutions division, it distributes specialty pharmaceutical products and provides consulting, patient support, logistics, group purchasing and other services. Its Nuclear and Precision Health Solutions division, prepare and deliver radiopharmaceuticals for use in nuclear imaging and other procedures. This division also contract manufactures a radiopharmaceutical treatment (Xofigo) and holds the North American rights to manufacture and distribute Lymphoseek, a radiopharmaceutical diagnostic imaging agent.
Its Medical segment (accounts less than 5% of sales) manufactures and sources branded general and specialty medical, surgical and laboratory products. These products include exam and surgical gloves; needle, syringe and sharps disposal; compression; incontinence; nutritional delivery; wound care; cardiovascular and endovascular; single-use surgical drapes, gowns and apparel; fluid suction and collection systems; urology; operating room supply; and electrode product lines. Also, this segment also assembles and sells sterile and non-sterile procedure kits.
Based in Dublin, Ohio, Almost all of Cardinal Health's revenue generates in the US though it operates in about 45 countries worldwide.
Its Pharmaceutical segment operated one national logistics center; a number of primary pharmaceutical and specialty distribution facilities as well as nuclear pharmacy and radiopharmaceutical manufacturing facilities. The Medical segment operated medical-surgical distribution, assembly, manufacturing and other operating facilities in the US.
Outside the US and Puerto Rico, its Medical segment operated manufacturing facilities in Canada, Costa Rica, the Dominican Republic, Germany, Ireland, Japan, Malaysia, Malta, Mexico, and Thailand.
Sales and Marketing
Cardinal Health sells to thousands of pharmacies and provides support to hospitals throughout the US. Its largest customers are CVS Health (about 25% of total revenue) and OptumRx (nearly 15% of revenue); its five largest customers combined account for around half of its total revenues. Group purchasing organizations are also key to the company's business, with Vizient and Premier together accounting for more than 20% of total revenues. Other customers include surgery centers, clinics, physician practices, and clinical laboratories.
Though the bulk of the company's operations consist of direct promotion, sales, and distribution of drugs and medical supplies, Cardinal Health does use some third-party distributors for the manufactured products from its Medical segment.
Revenue for fiscal 2019 was $145.5 billion, a 6% increase from the prior year, primarily due to sales growth from pharmaceutical distribution and specialty pharmaceutical customers, partially offset by the February 2018 divestiture of our China distribution business.
The company's net income increased by $1.1 billion to $1.4 billion, compared to the prior year with $259 million.
Cash in the end of 2019, increased by $768 million to $2.5 billion, compared to the prior year with $1.8 billion. Cash provided by operations and investing activities were $2.7 billion and $338 million, respectively. Cash used for financing activities was $2.3 billion.
The company has acquired a number of businesses over the years that have enhanced its core strategic areas of Cardinal Health Brand medical products, generic pharmaceutical distribution and services, specialty pharmaceutical products and services, international and post-acute care. Cardinal Health expect to continue to pursue additional acquisitions in the future.
Mergers and Acquisitions
In early 2019 Cardinal Health acquired Mirixa, which provides tools to help pharmacies manage medications, from the National Community Pharmacists Association. Mirixa joined Cardinal's Outcomes MTM business.
Cardinal Health harks back to Cardinal Foods, a food wholesaler named for Ohio's state bird. In 1971 Robert Walter, then 26 and with the ink still fresh on his Harvard MBA, acquired Cardinal in a leveraged buyout.
In 1980 Cardinal moved into pharmaceuticals distribution with the acquisition of Zanesville. It went public in 1983 as Cardinal Distribution, and Walter began looking for more acquisitions. Cardinal soon expanded nationwide by swallowing other distributors. In 1988 Cardinal sold its food group and narrowed its focus to pharmaceuticals.
14 Schoolhouse Rd
Somerset, NJ 08873-1213
Phone: 1 (732) 537-6544
Employer Type: Privately Owned
Director, HEOR Business Development: Christy Albertson
Inventory Control Supervisor: Stephen Kostic
Supplier Relations Manager: Anja Lowman
Employees (This Location): 300
Employees (All Locations): 5,000
West Chester, OH