Elizabeth Anderson

Elizabeth Anderson inquired about the demand environment in China, particularly concerning the RMS segment, and any other trends observed there. She also asked for insights into the improvement seen in the biologics testing business in Q4 2025.

Answer

James Foster, Chair, President, and Chief Executive Officer, stated that the China business (primarily RMS) continues to perform well, highlighting its importance and the company's role in elevating high-quality animal production. He mentioned exploring additional service revenue opportunities in China beyond RMS. For biologics testing, Mr. Foster explained that after a complicated 2025 due to lower sample volumes from large clients (project delays, regulatory challenges), the business returned to growth in Q4 2025, driven by higher demand, particularly from Europe. He expects client-specific challenges to be behind them in 2026.

Elizabeth Anderson asked for more details on Medicaid rates, how they are aligning with 2026 expectations, and any changes in acuity versus rate mismatch, either positive or negative.

Answer

EVP and President of Aetna Steve Nelson stated that the Medicaid business has been performing in line with expectations, with a strong year of rate advocacy execution in 2025. He noted that while it's a high-trend environment, the trends seen are consistent with expectations, and Aetna continues to work closely with state partners for adequate rates.

Elizabeth Anderson inquired whether the guidance includes the impact of Rite Aid volume shifting due to CVS closing, and sought clarification on potential opportunities arising from policy and regulatory changes in Washington D.C. given Cardinal Health's diverse business mix.

Answer

CEO Jason Hollar indicated that while Cardinal Health likely picked up a portion of the Rite Aid volume, it's not the primary driver of the broad-based strength. Regarding policy changes, he stated that Cardinal Health aligns with the administration's goal of affordable, innovative healthcare, suggesting such changes could be neutral to positive by driving utilization, though the exact impact on utilization and pricing remains hard to define.

Elizabeth Anderson inquired if the updated guidance includes the impact of Rite Aid volume shifting due to the CVS closing, and sought clarification on potential opportunities or impacts from policy and regulatory changes in Washington D.C. given Cardinal Health's diverse business mix.

Answer

CEO Jason Hollar explained that while Cardinal Health is likely picking up a greater share of Rite Aid's volume, it's not the primary driver of overall strength. Regarding policy changes, he stated the company aligns with the administration's goal of affordable, innovative healthcare, viewing such changes as neutral to positive for utilization and patient needs, with no material change to the solid utilization environment expected.