Cardinal to Sell PTS Segment

Cardinal Health plans to divest its Pharmaceutical Technologies and Services (PTS) segment, a business that manufactures or packages 100 billion doses of medication annually for pharma and biopharma firms. The segment employs approximately 10,000 people at more than 30 facilities worldwide and generates $1.8 billion in revenue.

“In the coming years, Cardinal Health will focus more on our products and services that help providers improve the safety and productivity of health care,” said R. Kerry Clark, president and chief executive officer of Cardinal Health. “While synergies clearly exist between PTS and our other businesses, we believe there is greater customer and shareholder value in the expansion of our supply-chain and medical and clinical products businesses domestically and internationally. These segments align with our core competencies and customers, and we see significant opportunities for future growth and improved return on capital.”

According to the company, the decision was made to focus its capabilities and resources to better serve health-care provider customers, such as hospitals and pharmacies. The company expects to use the proceeds to repurchase Cardinal Health shares. The company plans to continue to invest in organic growth and acquisitions to strengthen existing product and service offerings.

Cardinal Health will retain Martindale and Beckloff Associates, two businesses that support the generic pharmaceutical market. Martindale develops generic, intravenous medicine that is complementary to Cardinal’s hospital business and generics strategy. Beckloff provides regulatory consulting services, including for Cardinal’s generic products. Combined, these businesses have approximately 400 employees at two primary locations in the U.S. and UK.