Cardinal Health Adds to Warnings Over Drug Pricing -- Update
October 31 2016 - 9:36AM
Dow Jones News
By Austen Hufford
Cardinal Health Inc. became the latest drug distributor to warn
that the slowing pace of branded drug-price increases and lower
generic drug pricing would hurt results.
Chief Executive George Barrett said Monday that "short-term
headwinds, particularly around pharmaceuticals, are quite
challenging." Cardinal lowered its profit guidance for the year,
citing generic pharmaceutical pricing and reduced levels of branded
drug price increases.
The company now expects generic drug prices to fall in the
mid-to-high single digits, compared with an expected mid-single
digit decrease previously. It also expects branded drugs to
increase 7% to 9% in the year, down from 10% previously. Cardinal
Health now forecasts annual earnings adjusted earnings per share of
between $5.40 to $5.60, down from $5.48 to $5.73 previously.
Shares of many drugmakers, wholesale distributors and
pharmacy-benefit managers were battered Friday as evidence emerged
that drug companies aren't increasing prices as sharply as in
previous years. Cardinal shares rose 3% in premarket trading Monday
after falling sharply on Friday along with the rest of the
sector.
For the period ended Sept. 30, Cardinal Health reported a profit
of $309 million, or 96 cents a share, down from $383 million, or
$1.15 a share, a year prior. Excluding certain items, per-share
earnings fell to $1.24 from $1.38.
Revenue increased 14% to $32.04 billion.
Analysts polled by Thomson Reuters expected per-share profit of
$1.21 and revenue of $31.04 billion.
Pharmaceutical segment revenue climbed 15% to $28.80 billion,
while medical segment revenue grew 14% to $3.3 billion.
Write to Austen Hufford at austen.hufford@wsj.com
(END) Dow Jones Newswires
October 31, 2016 09:21 ET (13:21 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
Cardinal Health (NYSE:CAH)
Historical Stock Chart
From Aug 2024 to Sep 2024
Cardinal Health (NYSE:CAH)
Historical Stock Chart
From Sep 2023 to Sep 2024