Cardinal Health Inc. (NYSE:CAH) on Thursday entered into a binding Letter of Intent to extend its existing distribution agreement with CVS Health Inc. (NYSE:CVS) through June 30, 2032.
Distribution Partnership With CVS Health
The extension reflects the continuation of Cardinal Health’s current scope of distribution services.
In connection with the renewal, Cardinal Health has reaffirmed its fiscal year 2027 adjusted earnings growth guidance of 13% to 15%, equivalent to $12.40-$12.60 per share compared to the consensus of $12.04.
The healthcare distributor company reiterates long-term adjusted earnings per share growth rate guidance of 12% to 14%.
McKesson Signs Parallel CVS Agreement
On Thursday, McKesson Corporation (NYSE:MCK) also signed an agreement to extend its partnership with CVS Health to distribute pharmaceuticals to mail order and specialty pharmacies, retail pharmacies, and distribution centers through June 2032.
McKesson reiterated its fiscal 2027 adjusted earnings outlook between $44.20 and $45 per share, and its long-term adjusted EPS growth rate of 13% to 16%.
In September, Aetna, a healthcare subsidiary of CVS Health, expanded its prior authorization bundles across all cancer types for members in eligible Medicaid states starting September 1.
The health plan operator plans to eventually extend these bundled approvals across all lines of business by 2027.
The initiative builds on the initial rollout’s success, in which nearly 25% of eligible members received a bundled prior authorization.
Price Action: McKesson shares were up 4.28% at $890.35, and Cardinal Health shares were up 2.94% at $229.05 at the time of publication on Thursday, according to Benzinga Pro data.
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