(Source: Associated Press/AP Online)
NEW YORK - Medco Health Solutions Inc., the largest U.S. pharmacy benefits manager, said Tuesday its profit rose 13.5 percent as the company gained new clients and benefited from price inflation of brand-name drugs.
The company earned $335.6 million, or 69 cents per share, up from $295.7 million, or 58 cents per share, a year prior. Excluding charges, the company said it earned 75 cents per share. Revenue surged 18 percent to $14.79 billion from $12.56 billion.
Analysts polled by Thomson Reuters expected 72 cents per share in profit from $14.68 billion in revenue.
Medco, headquartered in Franklin Lakes, N.J., slightly raised its 2009 profit outlook to between $2.80 and $2.82 per share, mainly above Wall Street forecasts of $2.80 per share. Looking ahead, it set 2010 profit guidance between $3.28 and $3.38 per share, while analysts expect $3.28 per share.
"Clients are drawn to the value driven by Medco's innovations, and they have expressed their strong interest and confidence in Medco by awarding us over $20 billion of new business since 2008," said Chairman and CEO David B. Snow, in a statement.
He said the company expects to retain 99 percent of its clients in 2010.
Meanwhile, the generic dispensing rate rose 3.3 percent, with gains in both mail-order and retail rates. Total adjusted prescription volume rose 14.1 percent, though mail-order volume fell 2.3 percent mainly on a decrease in brand-name drugs.
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