SAN FRANCISCO--(BUSINESS WIRE)--McKesson Corporation (NYSE:MCK) today announced that it has signed a definitive agreement to purchase McQueary Brothers Drug Company, a Springfield, Missouri-based regional distributor of pharmaceutical, health, and beauty products to more than 400 independent and regional chain pharmacies in Missouri, Arkansas, Illinois, Kansas, Oklahoma, Nebraska and Iowa. The acquisition expands McKesson’s distribution footprint in the Midwestern U.S. and continues its momentum in the independent pharmacy segment. The purchase price is approximately $190 million.
The acquisition is expected to close in the second calendar quarter of 2008, subject to customary closing conditions, including regulatory review. After the closing, McQueary Brothers will be integrated into McKesson’s U.S. Pharmaceutical business, which is reported in the McKesson Distribution Solutions segment. The acquisition will have no significant impact on McKesson’s FY09 earnings and will be modestly accretive to FY10 earnings per fully diluted share.
“The anticipated addition of McQueary Brothers, a private, family-owned company that has been serving independent pharmacy for more than 80 years, reinforces McKesson’s ongoing commitment to the independent segment,” said Paul Julian, McKesson Executive Vice President and Group President. “Based on McKesson’s 175 year history of helping independent pharmacies manage and grow their businesses while improving their delivery of patient care, McQueary Brothers is a natural fit for McKesson.”
McKesson connects independent pharmacies to a broad suite of programs and services designed to help them manage and grow their businesses. Today, McKesson’s fast-growing Health Mart® franchise helps independent pharmacies compete locally and nationally by delivering managed care contracting services, marketing and advertising tools, in-store programs, and operational support. McKesson also offers a competitive generics purchasing program (McKesson OneStop Generics®), automation and pharmacy management systems, medication therapy management programs and front-end merchandising. Additionally, as a leading provider of connectivity solutions, McKesson helps connect payors, manufacturers, consumers, and other key healthcare players together in reimbursement and other patient care services.
“As the country’s oldest and largest pharmaceutical wholesaler, McKesson is committed to supporting the expanding needs of independent pharmacy in America, and securing their place in the healthcare system,” said John Figueroa, President, McKesson U.S. Pharmaceutical. “The combination of McKesson and McQueary Brothers will allow McKesson to offer our broad portfolio of products and services to hundreds more independent pharmacies in the Midwestern United States.”
About McQueary Brothers
McQueary Brothers Drug Company, based in Springfield, Missouri, is a regional distributor of pharmaceutical, health, and beauty products to more than 400 independent and regional chain pharmacies in Missouri, Arkansas, Illinois, Kansas, Oklahoma, Nebraska and Iowa. Founded by brothers Les and Fred McQueary in 1924, the company is now in its 4th generation of family ownership.
About McKesson
McKesson Corporation, currently ranked 18th on the FORTUNE 500, is a healthcare services and information technology company dedicated to helping its customers deliver high-quality healthcare by reducing costs, streamlining processes, and improving the quality and safety of patient care. McKesson is the longest-operating company in healthcare today and in 2008 is marking 175 years of continuous operations. Over the course of its history, McKesson has grown by providing pharmaceutical and medical-surgical supply management across the spectrum of care; healthcare information technology for hospitals, physicians, homecare and payors; hospital and retail pharmacy automation; and services for manufacturers and payors designed to improve outcomes for patients. For more information, visit us at www.mckesson.com.
Risk Factors
Except for historical information contained in this press release, matters discussed may constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, as amended, that involve risks and uncertainties that could cause actual results to differ materially from those projected, anticipated or implied. These statements may be identified by their use of forward-looking terminology such as “believes”, “expects”, “anticipates”, “may”, “should”, “seeks”, “approximately”, “intends”, “plans”, “estimates” or the negative of these words or other comparable terminology. The discussion of financial trends, strategy, plans or intentions may also include forward-looking statements. It is not possible to predict or identify all such risks and uncertainties; however, the most significant of these risks and uncertainties are described in the company’s Form 10-K, Form 10-Q and Form 8-K reports filed with the Securities and Exchange Commission and include, but are not limited to: adverse resolution of pending securities litigation regarding the 1999 restatement of our historical financial statements; the changing U.S. healthcare environment, including changes in government regulations and the impact of potential future mandated benefits; competition; changes in private and governmental reimbursement or in the delivery systems for healthcare products and services; governmental and manufacturers’ efforts to regulate or control the pharmaceutical supply chain; changes in government regulations relating to patient confidentiality standards; changes in pharmaceutical and medical-surgical manufacturers’ pricing, selling, inventory, distribution or supply policies or practices; changes in the availability or pricing of branded and generic drugs; changes in customer mix; substantial defaults in payment or a material reduction in purchases by large customers; challenges in integrating and implementing the company’s internally used or externally sold software and software systems, or the slowing or deferral of demand or extension of the sales cycle for external software products; continued access to third-party licenses for software and the patent positions of the company’s proprietary software; the company’s ability to meet performance requirements in its disease management programs; the adequacy of insurance to cover liability or loss claims; changes in circumstances that could impair our goodwill or intangible assets; new or revised tax legislation; foreign currency fluctuations or disruptions to foreign operations; the company’s ability to successfully identify, consummate and integrate strategic acquisitions; changes in generally accepted accounting principles (GAAP); ability to timely complete McKesson’s acquisition of McQueary Brothers Drug Company, as currently scheduled, including receipt of any necessary regulatory approvals; and general economic conditions. The reader should not place undue reliance on forward-looking statements, which speak only as of the date they are made. The company assumes no obligation to update or revise any such statements, whether as a result of new information or otherwise.
Contacts
McKesson Corporation
Ana Schrank, 415-983-7153 (Investors and Financial Media)
Ana.Schrank@McKesson.com
James Larkin, 415-983-8736 (General and Business Media)
James.Larkin@McKesson.com
