RALEIGH, N.C., April 27 /PRNewswire/ -- Anchor Capital, a stockholder of BioScrip, Inc. (Nasdaq: BIOS), announced today that it has sent a letter to the Board of Directors of BioScrip in which Anchor Capital argues that BioScrip's shareholder value would be maximized through simultaneous i) cost rationalizations and ii) exploration of strategic alternatives to unlock the considerable shareholder value, with focus on a sale to a strategic acquirer.

Speaking on behalf of Anchor Capital, Clay Dunnagan explained that he believes shareholders have lost patience with BioScrip's frequent missteps causing the shares to decline 67.4% since 12/31/ 07. Mr. Dunnagan added that time is of the essence to improve operations and complete a transaction because BioScrip's competitors are better operated, better capitalized and better positioned.

Based on Anchor Capital's analysis of potential cost reductions and strategic acquirer synergies of at least $37 million and despite present, depressed peer group trading multiples, as set forth in an analysis included with the letter, Anchor Capital estimates that a sale to a strategic buyer could potentially yield an increase of over 325% per share from BioScrip's April 22nd closing price. Mr. Dunnagan explained that in his opinion BioScrip's current cost structure and competitive position are denying shareholders the ability to recognize maximum value for their investment. Mr. Dunnagan respectfully called on the Board to provide its view regarding a strategic sale as soon as possible.

The full text of the letter follows:

April 23, 2009

Members of the Board

c/o Barry A. Posner, Executive Vice President

BioScrip, Inc.

100 Clearbrook Road

Elmsford, NY 10523

Dear Members of the Board:

Affiliates of Anchor Capital ("Anchor Capital") own 512,297 shares of BioScrip, Inc. ("BIOS" or the "Company") or approximately 1.3% of its outstanding common stock. We are very familiar with the challenges the Company has faced and the efforts made by its management and employees in order to participate in an increasingly competitive pharmacy services industry. High-touch, value-added service levels have been largely replaced over the past 10 years by low-touch, commoditized distribution as the industry has consolidated rapidly, making pricing and economies of scale the chief competitive factors. BIOS has attempted to maintain its market position within this consolidating industry by acquiring various competitors culminating in the 2005 purchase of Chronimed and diversifying its business to include Infusion, Retail and Mail Distribution in addition to its traditional Pharmacy Benefit Manager.

Unfortunately, BIOS has not sufficiently integrated its acquisitions and managed SG&A expenses and, therefore, faces significant near-term headwinds as it competes with more efficient, larger and better-capitalized industry players. Despite the pre- Chronimed merger promise of "significant operational cost saving synergies" from "combining like-kind functions and facilities," BIOS's acquisition program resulted in material growth in SG&A on an absolute basis and as a percentage of revenue.