(Reuters) -Drug distributor Cardinal Health raised its annual adjusted profit forecast on Thursday after beating estimates for first-quarter profit on strong demand for costly specialty medicines and branded drugs at its pharmaceuticals unit.
Shares of the Dublin, Ohio-based company rose more than 10% before the bell.
Drug distributors have been benefiting from sales of specialty medicines, which are used to treat complex conditions like rheumatoid arthritis and cancer, due to their high profit margins.
They have also benefited from sales of cheaper versions of complex biotech drugs called biosimilars at a time when prices of generic medicines have been falling due to intense competition.
Cardinal now expects adjusted profit per share in a range of $9.65 to $9.85 for fiscal year 2026, up from its prior range of $9.30 to $9.50 per share.
The company said the 35-cent increase reflects its strong first-quarter performance. It anticipates contributions from its pending acquisition of Solaris Health that is expected to close in early November.
Cardinal Health said in August it would buy healthcare management firm Solaris Health for $1.9 billion in cash.
For the reported quarter, Cardinal reported adjusted profit of $2.55 per share, beating analysts’ estimate of $2.18 per share, according to data compiled by LSEG.
Its quarterly revenue came in at $64 billion, above an estimate of $59.20 billion.
The company’s Pharmaceutical and Specialty Solutions segment, which distributes branded and generic drugs, specialty medicines and over-the-counter products, generated $59.2 billion in revenue in the three months ended September 30, up 23% year-over-year.
(Reporting by Siddhi Mahatole in Bengaluru; Editing by Pooja Desai)
Brought to you by www.srnnews.com