McKesson For Better Health
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We are uniquely positioned to shape the future of Healthcare Largest healthcare services company in the world Fortune 14 $112 billion in revenues (FY11) More than 36,000 employees dedicated to healthcare Oldest U.S. healthcare company Established 1833 driving innovation in healthcare Only company offering solutions at every point of care Deep clinical, IT, and process expertise 4 McKesson Corporation Confidential and Proprietary
A 360 o View of Healthcare: We create Value at Every Point of Care Healthcare Providers 200,000 physicians Over 2,700 hospitals 11,600 LTC facilities 2,100 home care Retail Pharmacies Over 23,000 locations Manufacturers 1,500 pharmaceutical 1,425 medical-surgical 1,050 consumer products Consumers 50 million covered lives Health Plans 300 payer organizations Double Check Stats! Used stats from more Recent ppt 5 McKesson Corporation Confidential and Proprietary
We have a range of businesses across both our segments Distribution Solutions: 1. US Pharma 2. McKesson Specialty Health (MSH) 3. McKesson Medical-Surgical (Med-Surg) 4. McKesson Pharmacy Systems & Automation (MPS&A) 5. McKesson Canada Technology Solutions: 1. McKesson Provider Technologies (MPT) 2. McKesson Health Solutions (MHS) 3. RelayHealth 4. Physician Practice Solutions (PPS) 5. Revenue Management Solutions (RMS) 6. International Operations Group (IOG) McKesson Corporation Confidential and Proprietary 6
Distribution Solutions is our largest segment by revenue and profit Distribution Solutions: 1. US Pharma 2. McKesson Specialty Health 3. McKesson Medical-Surgical (Med-Surg) 4. McKesson Pharmacy Systems & Automation (MPS&A) 5. McKesson Canada #1 pharmaceutical distributor in U.S. and Canada #1 generics distributor #2 in specialty distribution and services #1 in medical-surgical distribution to alternate care sites 2,700+ Health Mart retail pharmacy franchisees Comprehensive retail information systems and automation offerings Revenue: 97% Operating Profit: 76% McKesson Corporation Confidential and Proprietary 7
US Pharma San Francisco, CA Fast Facts: Is McKesson s largest business; 63% of operating profit Includes HealthMart, McKesson s independent pharmacy franchise What they do: Distribution of pharmaceuticals and ancillary products Generics sourcing Unit dose repackaging HealthMart franchise Central Fill operations Who they serve: National chains (e.g. Walmart, CVS CareMark) Hospitals and health systems Independents, small chains (includes HealthMart) Government 8
US Pharma San Francisco, CA Distribution of drugs to pharmacies and hospitals 9
McKesson Specialty Health Houston, TX Fast Facts: Results of McKesson Specialty and US Oncology merger in 2010 US Oncology doctors continue to own the practices What they do: Specialty medication distribution, including vaccines Technology solutions for specialty practices (Lynx, IKnowMed EHR) US Oncology practice management Who they serve: 500 sites 3,000+ oncologists 2,600 multi-specialty practices 1.5M oncology patients 10
McKesson Specialty Health Houston, TX Oncology/specialty practice management McKesson distribution, technology, and operational excellence + US Oncology network of Physicians 11
McKesson Medical-Surgical (Med-Surg) Richmond, VA Fast Facts: Medical-surgical supply distribution everywhere but acute care What they do: Distribution of med-surg supplies, diagnostic equipment, first aid/safety solutions McKesson branded solutions, like surgical gloves Who they serve: Physician practices Surgery centers IDNs HomeHealth Government Schools 12
McKesson Medical-Surgical (Med-Surg) Richmond, VA Surgical gloves, hand sanitizer or gauze 13
McKesson Pharmacy Systems & Automation (MPS&A) Pittsburgh, PA Fast Facts: Provides technology and services to retail pharmacies What they do: Retail pharmacy technology, including pharmacy systems Integration with other McKesson retail pharmacy solutions Who they serve: Health System Outpatient Pharmacy Retail Pharmacy 14
McKesson Pharmacy Systems & Automation (MPS&A) Pittsburgh, PA Systems a retail pharmacist needs to fill your prescription 15
McKesson Canada Montreal, Quebec Fast Facts: Integrated distribution and technology solutions for the Canadian market What they do: Pharmaceutical distribution Pharmacy Automation Retail Pharmacy technology EHR (electronic health record) systems Who they serve: Health Systems, e.g. ehealth Ontario Government, e.g. Province of Nova Scotia Retail pharmacies 16
McKesson Canada Montreal, Quebec All McKesson s offerings, north of the border Distribution and Technology 17
Distribution Solutions compete against large, national distributors Distribution Solutions: 1. US Pharma 2. McKesson Specialty Health (MSH) 3. McKesson Medical-Surgical (Med-Surg) 4. McKesson Pharmacy Systems & Automation (MPS&A) 5. McKesson Canada Competition: Consolidated distribution market, with competition from large, national distributors: Cardinal Health AmerisourceBergen Owens & Minor Targeted competition in the technology and med-surg space: Self-developed technology or distribution networks Small niche players McKesson Corporation Confidential and Proprietary 18
While only 3% of revenue today, Technology Solutions is a growth segment Technology Solutions: 1. McKesson Provider Technologies (MPT) 2. McKesson Health Solutions (MHS) 3. RelayHealth 4. Physician Practice Solutions (PPS) 5. Revenue Management Solutions (RMS) 6. International Operations Group (IOG) MTS serves 50% of all U.S. hospitals Leader in clinical, revenue cycle, and resource management solutions RelayHealth is a leader in claims processing and connectivity business 100,000+ physician customers touched #1 in hospital automation #1 in medical management software and services to Payers Revenue: 3% Operating Profit: 24% McKesson Corporation Confidential and Proprietary 19
McKesson Provider Technologies (MPT) Atlanta, GA Fast Facts: Includes six different businesses, including HSES, HSPM, Paragon, MAI, EMI and Managed Services What they do: Software and robotics for health systems EHR, financials, analytics, supply chain Imaging Automation Who they serve: 50% of all US Hospitals, including: Eisenhower Tufts Appalachian Regional 20
McKesson Provider Technologies (MPT) Atlanta, GA Technology backbone for health systems Nursing Home Care Rx Drugs Home Healthcare Hospital Physician/Clinical Services 21
RelayHealth Atlanta, GA Fast Facts: Newly combined RelayHealth Connectivity and RelayHealth Pharmacy What they do: Connectivity solutions for all constituents Transaction processing Patient portals HIE eprescribing solutions Who they serve: Payers, providers, consumers 90% of retail pharmacies and 100% of providers 70% of all retail pharmacy transactions 22
RelayHealth Atlanta, GA Connection between various technology solutions and players HealthVault Hospitals Virtual Information Exchange Hospital Labs Physician Practices Health Labs Community Labs Google Physician Practices This is also one of the few products your friends might know Surescripts NHIN Regional Hospitals 23
McKesson Health Solutions (MHS) Newton, MA Fast Facts: Solutions for payers Not MHS on the US Pharma side What they do: Medical solutions, such as InterQual, care management, and nurse hotlines Payment solutions, such as claim check Who they serve: 100% of top 10 payers 90% of Blues 90% of Managed Medicaid VA, DoD, CMS, 33 states 3,900 hospitals 24
McKesson Health Solutions (MHS) Newton, MA Solutions for payers Medical Management + Claims Management
Physician Practice Solutions (PPS) Atlanta, GA Fast Facts: Software for physician practices, including practice management and EHR What they do: Physician office software: Practice Management EHR Analytics Who they serve: Independent physician practices, ranging from 1 to 100+ doctors 26
Physician Practice Solutions (PPS) Atlanta, GA Software for the small doctor office 27
Revenue Management Solutions (RMS) Fast Facts: Outsourced revenue cycle management for providers What they do: Accounts receivable and medical billing services Revenue cycle management Chart reconciliation Medical coding Who they serve: Physician practices: Academic Hospital affiliated Laboratory Independent 28
Revenue Management Solutions (RMS) Payments solutions for doctors 29
International Operations Group (IOG) Fast Facts: McKesson in UK, Ireland, France, Netherlands Technology-focused What they do: Healthcare technology sold in the European market: Healthcare HIS, Workforce Mgmt Imaging Who they serve: Primarily UK, France, Netherlands >50% are in the UK, including the NHS 30
International Operations Group (IOG) Technology business across the pond 31
The Technology Solutions market remains fragmented Technology Solutions: 1. McKesson Provider Technologies (MPT) 2. McKesson Health Solutions (MHS) 3. RelayHealth 4. Physician Practice Solutions (PPS) 5. Revenue Management Solutions (RMS) 6. International Operations Group (IOG) Competition: Extremely fragmented market Competition varies by business and technology focus: EMRs: Epic, Cerner, Meditech Automation: CareFusion, OmniCell Payer solutions: Ingenix, Trizetto Connectivity: Emdeon, Optim Consolidation and overlap of competitors increasing McKesson Corporation Confidential and Proprietary 32
A 360 o View of Healthcare: We create Value at Every Point of Care Healthcare Providers 200,000 physicians Over 2,700 hospitals 11,600 LTC facilities 2,100 home care Retail Pharmacies Over 23,000 locations Manufacturers 1,500 pharmaceutical 1,425 medical-surgical 1,050 consumer products Consumers 50 million covered lives Health Plans 300 payer organizations Double Check Stats! Used stats from more Recent ppt