Cardinal mulls spinoff of medical, clinical units
DUBLIN, Ohio —Maybe being a $90 billion wholesale and health services behemoth isn’t always the best way to serve and profit from the healthcare market.
Cardinal Health has taken a good, long look in the mirror, and what it sees is a company that may be too big and diverse to get the job done most effectively. So the healthcare and distribution giant is mulling a partial breakup of its primary operating and reporting segments.
Following a two-year, top-to-bottom appraisal of its mission and business strategy, Cardinal last month revealed the dramatic fruits of that effort: a long-term plan to streamline its sprawling and complex operating structure and focus more effectively on its core businesses in drug distribution and medical supplies. The strategy could involve a tax-free spin-off of the company’s clinical and medical products businesses as a separate, publicly traded company.
In August, Cardinal’s leaders said the company most likely would announce its decision in a 60- to 90-day timeframe.
The move follows a long process of self-evaluation for the huge company, which posted sales of $91 billion in fiscal 2008. In July, Cardinal revealed a plan to consolidate its businesses into two primary operating and reporting segments “to reduce costs and align resources with the unique needs of each segment.”
Last month’s announcement of a possible spin-off goes a big step further. “For two years, we have been taking steps to sharpen our focus on healthcare supply chain services and clinical and medical products, culminating with our announcement in July to operate these businesses in two distinct segments that reflect the unique characteristics and requirements of each,” said R. Kerry Clark, chairman and chief executive officer.
Under the consolidation plan announced in July, Cardinal’s $80 billion core business, its network of pharmaceutical and medical product distribution centers and nuclear pharmacies, will form the Healthcare Supply Chain Services segment, led by vice chairman George Barrett. Products for infusion, medication dispensing, respiratory care and infection prevention will be grouped in the Clinical and Medical Products segment under the leadership of vice chairman David Schlotterbeck.
Walgreens donates food, supplies as new storms target Gulf, Southeast
DEERFIELD, Ill. Walgreens has sent truckloads of food, water and emergency supplies to Baton Rouge, La., to aid with continuing Hurricane Gustav relief efforts.
Among the necessities shipped to hard-hit residents: water, trail mix, granola bars and other snack items, along with infant formula and diapers. Walgreens reports it is also gathering supplies to place on standby for a swift response to new emergency requests across the nation’s southeast coast with the expected arrival of Tropical Storm Hanna this weekend and Hurricane Ike next week.
“We’ll direct critical resources to communities in need,” said Walgreens director of community affairs John Gremer. “We’re on alert, and we’ll be ready to help wherever we can.”
The company notes there is still “tremendous need in many Baton Rouge communities,” which were among the hardest hit by Gustav. “Thousands remain without electricity, and food and water are still in high demand,” the company reports.
Another priority is getting any stores that were closed due to the storm back open quickly, according to the chain. As of Friday morning, Walgreens reported, “all but one of Walgreens’ 15 Baton Rouge stores are open. Across the Gulf Coast region, only nine remain closed down from 69 closed immediately following the storm.”
Rite Aid donates $44,500-plus in supplies for Gustav evacuees
CAMP HILL, Pa. To further assist evacuees of Hurricane Gustav, The Rite Aid Foundation is donating more than $44,500 worth of supplies including water, snacks, sunscreen, hand sanitizer and other personal hygiene products as requested by the Louisiana Capital Area Chapter of the American Red Cross to be distributed at shelters for evacuees, the Foundation announced Friday
“Throughout the Gulf Coast, widespread flooding and violent wind damage have created an urgent need for disaster support,” stated Jeff Towers, chief development officer at the American Red Cross. “Rite Aid generously responded to this need through in-kind and financial support to help the Red Cross provide food, shelter and counseling to Gulf Coast communities during this hurricane season.”
Earlier this week, The Rite Aid Foundation made a $75,000 donation to the American Red Cross to help the victims, families and communities affected by Hurricane Gustav in Louisiana, Mississippi and Alabama. A relief team of Rite Aid associates, including store cashiers and pharmacists, have traveled from Tennessee and unaffected areas of Louisiana and Alabama to help stores that have been impacted and to help reopen additional stores.
“One of Rite Aid’s core values is to be caring neighbors in the communities we serve, and we are happy to work with the American Red Cross to help the evacuees of Hurricane Gustav,” commented Mike Seesholtz, Rite Aid regional vice president for Alabama, Louisiana and Mississippi. “Our associates have been amazing in their commitment to do whatever they can to help the victims of Hurricane Gustav.”
Residents displaced by the hurricane can visit any open Rite Aid for their prescriptions because the company’s satellite-linked computer network assures a complete customer prescription history at any Rite Aid store. Because of the state of emergency, Rite Aid pharmacies also can access prescription information for patients who do not normally get their prescriptions at Rite Aid.