ELMSFORD, N.Y., Aug. 31, 2015 /PRNewswire/ -- BioScrip, Inc.
(NASDAQ: BIOS) ("BioScrip" or the "Company") today provided an
update on the Company's plan to enhance shareholder value, improve
financial flexibility and position BioScrip as a pure play infusion
services company focused on high-growth services. As previously
announced, the Company expects to realize $35 million – $40
million in annualized net cost savings over the next 12
months as part of its Financial Improvement Plan.
The Company provided the following update on its cost saving and
financial improvement initiatives to create value:
- BioScrip has completed the previously announced sale of its
non-core PBM business to ProCare Pharmacy Benefit Manager Inc., a
privately held pharmacy benefit manager and part of the ProCare Rx
companies, for $25 million in cash.
The PBM activities represented approximately $66 million of annual revenue. The net proceeds
were used to pay down debt.
- BioScrip's workforce reduction is on track and will be
substantially complete by the end of the third quarter. As
previously announced, the reductions are expected to generate
$19 million in total savings. The
reductions are in specific areas, including corporate
infrastructure and are not expected to impact BioScrip's ability to
provide quality care and service to patients.
- Supply chain related activities are being negotiated and are
expected to generate $3 million in
annual savings by the beginning of 2016, contributing to operating
improvement.
- Corporate and field operating improvement programs have been
initiated and are estimated to deliver cost savings of $10 million annually and contribute to operating
improvements beginning in January
2016.
Carter Pate, Chair of the
Financial Improvement Plan Committee of the Board of Directors
said, "While we still have work to do, these announcements
demonstrate the progress in the execution of our cost savings and
financial improvement initiatives. These important strategic steps
will drive shareholder value by focusing on our core infusion
platform, reducing costs and enhancing BioScrip's financial
flexibility. The BioScrip Board of Directors and management remain
committed to the Company's Financial Improvement Plan. We all look
forward to achieving our objectives."
Rick Smith, President and Chief
Executive Officer of BioScrip, said, "We are pleased to complete
the sale of our non-core PBM business and announce that we are
accomplishing key elements of our Financial Improvement Plan. Our
patient census levels continue to see solid progression, consistent
with expectations. All of these efforts are significant milestones
in our work to streamline the Company, maintain dynamic growth in
our core business, and position BioScrip as a pure play infusion
services provider. We will continue to execute on our plan and
concentrate on opportunities with the highest value-creating
potential."
Balance Sheet Update
As of August 31, 2015, the Company
has $73.9 million of total liquidity,
comprised of $19.6 million of cash
and $54.3 million of undrawn capacity
available on its revolving credit facility. The Company was in
compliance with its financial covenants as of June 30, 2015. On August
6, 2015, the Company entered into a fourth amendment (the
"Fourth Amendment") to its credit agreement. The Fourth Amendment,
among other things, provides additional relief and flexibility with
respect to measuring compliance with the maximum first lien net
leverage ratio. The maximum first lien net leverage ratio for the
fiscal quarters ending September 30,
2015 through and including June 30,
2016 is 7.25. The maximum first lien net leverage ratio for
the fiscal quarters ending September 30,
2016 through and including March 31,
2017 is 6.50. For the purpose of measuring compliance with
the maximum first lien net leverage ratio, the Fourth Amendment
permits the Company to adjust EBITDA on a pro forma basis to
include the estimated financial impact of any reductions in
workforce.
About BioScrip, Inc.
BioScrip, Inc. is a leading national provider of infusion and
home healthcare management solutions. BioScrip partners with
healthcare providers, including physicians, hospital systems,
skilled nursing facilities, and with healthcare payors to provide
patients better access to high quality, efficient post-acute care
services. BioScrip operates with a commitment to bring infusion
therapy services into the home or alternate-site settings. By
collaborating with the full spectrum of healthcare professionals
and the patient, BioScrip provides cost-effective care that is
driven by clinical excellence, customer service, and values that
promote positive outcomes and an enhanced quality of life for those
it serves.
Forward-Looking Statements – Safe Harbor
This press release includes statements that may constitute
"forward-looking statements," including projections of certain
measures of the Company's results of operations, projections of
future levels of certain charges and expenses, and other statements
regarding the Company's financial improvement plan and strategy.
These statements are made pursuant to the safe harbor provisions of
the Private Securities Litigation Reform Act of 1995. You can
identify these statements by the fact that they do not relate
strictly to historical or current facts. In some cases,
forward-looking statements can be identified by words such as
"may," "should," "could," "anticipate," "estimate," "expect,"
"project," "outlook," "aim," "intend," "plan," "believe,"
"predict," "potential," "continue" or comparable terms. Because
such statements inherently involve risks and uncertainties, actual
future results may differ materially from those expressed or
implied by such forward-looking statements. Investors are cautioned
that any such forward-looking statements are not guarantees of
future performance and involve risks and uncertainties, and that
actual results may differ materially from those in the
forward-looking statements as a result of various factors.
Important factors that could cause or contribute to such
differences include but are not limited to risks associated with:
the Company's ability implement its financial improvement plan to
reduce operating costs and focus its business on its Infusion
Services segment; reductions in federal, state and commercial
reimbursement for the Company's products and services; increased
government regulation related to the health care and insurance
industries; as well as the risks described in the Company's
periodic filings with the Securities and Exchange Commission. The
Company does not undertake any duty to update these forward-looking
statements after the date hereof, even though the Company's
situation may change in the future. All of the forward-looking
statements herein are qualified by these cautionary statements.
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SOURCE BioScrip, Inc.