Generics move McKesson profits up
SAN FRANCISCO — McKesson Corp. on Monday reported revenue of $28.2 billion for its fiscal third quarter, ended Dec. 31, 2010. Third-quarter earnings per diluted share were 60 cents, which included a pre-tax average wholesale price litigation charge of $189 million ($133 million after-tax, or 52 cents per diluted share).
Excluding the AWP litigation charge, third-quarter earnings per diluted share from continuing operations were $1.12, the company noted. In the prior-year’s third quarter, earnings per diluted share were $1.19, which included the benefit of higher-margin distribution services revenues associated with the H1N1 flu virus.
The third-quarter AWP litigation charge represents an increase to an existing litigation reserve for current and possible future public entity claims against McKesson relating to drug reimbursement benchmarks known as AWPs. Following the company’s announcement of its settlement of all private-party AWP claims in the third quarter of fiscal year 2009, a reserve for estimated probable losses for all public-entity AWP claims was established.
McKesson has continued to engage in settlement discussions with the purpose of resolving various of the public-entity claims, the company stated. McKesson consistently has stated that these cases are without merit and, absent settlements acceptable to the company, they will continue to be defended.
In the third quarter, Distribution Solutions revenues were flat. U.S. pharmaceutical distribution revenues were down 1% due to reduced revenues associated with two of McKesson’s warehouse customers and the prior-year’s impact of the H1N1 flu virus.
"Distribution Solutions had strong performance this quarter," stated John Hammergren, McKesson chairman and CEO. "Looking ahead, we are well-positioned to continue to benefit from the pipeline of higher-margin generic drugs. We also have significantly improved our strategic position through our acquisition of U.S. Oncology, and our expanded suite of solutions and services will uniquely enhance oncologists’ ability to provide high-quality care to their patients."
PharmaSmart enhances blood-pressure diagnostic, health IT kiosks
ROCHESTER, N.Y. — PharmaSmart International on Monday announced new advances in its blood-pressure diagnostic and health IT kiosks, including Internet connectivity, patient data tracking and patient health record integration.
“PharmaSmart now combines a clinically validated diagnostic tool with an easy-to-use health IT platform to offer pharmacists meaningful tools for better patient care,” stated Ashton Maaraba, PharmaSmart GM and SVP. “This represents a new era of clinical pharmacy services.”
Retail pharmacies offering the program enroll patients into PharmaSmart’s integrated patient management platform, Maaraba said. Once enrolled, the pharmacist uses the integrated personal health record functionality to provide therapeutic counseling and interventions as required.
“In addition to our suite of pharmacist and patient tools, our IT platform enables robust program reporting,” Maaraba said. “For example, in 2010, our client networks captured nearly 1.5 million blood-pressure readings that were hypertensive. This is a huge, untapped opportunity for pharmacist intervention.”
Enrolled patients also have access to a retail-branded personal health record that stores and organizes their diagnostic readings, the company added. PharmaSmart kiosks and Web services are confidential and HIPAA-compliant.
Fla. judge overturns individual mandate provision in healthcare-reform law
PENSACOLA, Fla. — A federal judge in Florida has overturned a key portion of the healthcare-reform law and ruled that the entire law must be scrapped.
In a 78-page decision, Judge Roger Vinson, a Reagan appointee in the U.S. District Court for the Northern District of Florida, ruled that The Patient Protection and Affordable Care Act’s requirement that individuals buy insurance or incur fees — also known as the individual mandate, which would take effect in 2014 — was unconstitutional because it violated the Constitution’s Commerce Clause. He also ruled that the bill must be considered unconstitutional in its entirety, thus overturning it in full. The Obama administration has announced it will appeal the ruling.
“I emphasized once before, but it bears repeating again: This case is not about whether the act is wise or unwise legislation, or whether it will solve or exacerbate the myriad [of] problems in our healthcare system,” Vinson wrote in his decision. “In fact, it is not really about our healthcare system at all. It is principally about our federalist system, and it raises very important issues regarding the constitutional role of the federal government.”
Still, Vinson did not issue an immediate injunction against the bill, allowing it to continue taking effect pending an appeals process that could take two years. He also did not mention the bill’s provision of a regulatory approval pathway for follow-on biologics.
Supporters of the bill have argued that the individual mandate provision is needed to protect individuals with pre-existing conditions, who might be tempted to wait to purchase insurance until they actually need it rather than buying it beforehand. In addition, a recent report by the Congressional Budget Office found that repeal of the bill would add $230 billion to the federal deficit and leave tens of millions without health insurance.
Twenty-six states have filed lawsuits against the bill since President Barack Obama signed it into law last March. The new Congress also mounted a largely symbolic effort to overturn the bill once members took their seats last month.
In December 2010, District Judge Henry Hudson in Virginia also ruled that the individual mandate was unconstitutional.