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CFO Aaron Alt clarified that the $0.20 EPS guidance increase for the year was driven roughly equally by two factors: about half from the liability classification of the minority interest and the other half from higher operational expectations for both the Pharma and Other business segments, reflecting strong underlying demand.

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CEO Jason Hollar explained that the growth was broad-based, stemming from continued strength in specialty distribution, BioPharma Solutions, and the initial positive impact from the GI Alliance and ION acquisitions. He noted that GLP-1s accounted for approximately 7 percentage points of the 20% underlying revenue growth. CFO Aaron Alt added that for fiscal 2026, the company assumes a continued positive utilization environment and strong specialty growth.

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CEO Jason Hollar explained that the segment's strength was broad-based across brand, specialty, consumer health, and generics, not driven by any single factor. He clarified that the COVID-19 vaccine provided only a 'slight tailwind' in Q1 and is still expected to be a modest headwind for the full year. While specialty growth was strong, he noted it was part of the overall robust utilization trend rather than a specific IRA-driven event.

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CEO Wendy Barnes acknowledged that while PBM partnerships provide the fastest access to commercial lives, the company has metered expectations due to inconsistent surfacing of GoodRx's pricing. She emphasized that adding brand drugs is a key value-add for PBMs and confirmed new contracts have been signed. CFO Chris McGinnis added that while ISP is strategically important, significant upside from new partners and direct-to-employer initiatives is more likely a 2026 opportunity.

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CEO Wendy Barnes explained that while ISP is a key channel, its performance can be inconsistent within PBM systems. She highlighted that adding brand drugs is a significant value-add driving PBM engagement and confirmed new partnerships have been signed. CFO Chris McGinnis added that while the program has strategic merit, significant upside from new partners, brand drugs, and a direct-to-employer model is more likely a 2026 opportunity.

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CEO Wendy Barnes identified three key initiatives: deepening partnerships with retail pharmacies through direct contracting and e-commerce, expanding brand partnerships with pharma manufacturers via point-of-sale cash buydowns, and enhancing engagement with healthcare professionals (HCPs). CFO Chris McGinnis addressed the Rite Aid situation, explaining that the bankruptcy sale process is different from past closures and that GoodRx is actively working with potential bidders to ensure a smooth transition of prescriptions. Wendy Barnes added that GoodRx's relationships with pharmacies and its ability to directly contact users are materially stronger than in the past.

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CEO Wendy Barnes identified closer partnerships with retail pharmacies (direct contracting and e-commerce), expanding manufacturer point-of-sale cash buydowns, and enhancing engagement with healthcare professionals (HCPs) as key initiatives. CFO Chris McGinnis addressed the Rite Aid bankruptcy, noting it's a unique situation involving an asset sale, and stated GoodRx is actively working with potential bidders to ensure a smooth transition of prescriptions. Wendy Barnes added that GoodRx's ability to directly communicate with its users is materially higher than in the past, aiding in these transitions.

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CEO Wendy Barnes explained that the guidance includes expected growth from manufacturer programs, particularly brand expansion, and benefits from enhanced retailer partnerships that have improved pharmacy profitability. Regarding the Integrated Savings Program (ISP), she noted solid traction and a significant opportunity with the 'ISP wrap' for non-covered brands, adding that GoodRx is in active discussions to add new PBM partners to the program.

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CFO Karsten Voermann confirmed that Pharma Manufacturer Solutions will form the majority of growth in 2025. He noted that the outlook for the prescriptions marketplace is wider and more conservative due to pharmacy uncertainty. He also expressed excitement for the new ISP "wrap" program for off-formulary brands but noted its newness makes it difficult to predict the exact rollout trajectory.

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CEO David Bourdon clarified that the shift from cash-pay to insured care is a broad industry tailwind that benefits their model. He affirmed that Lifestance has existing capacity and is focused on improving clinician productivity to meet this demand, carefully balancing hiring with patient volume.

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Incoming CEO Dave Bourdon clarified that the 2026 rate outlook is based on the conclusion of a significant, unique payer rate decrease that is pressuring 2025 results, not on pre-signed contracts. Outgoing CEO Ken Burdick stated that the M&A strategy is expanding beyond tuck-ins to include new capabilities and customer segments. He noted the environment is more favorable for acquisitions now, as the market demands earnings, not just revenue growth, which pressures less-profitable competitors.

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EVP & CFO Britt Vitalone stated that the impact from Rite Aid's second bankruptcy is immaterial to McKesson's operations and profit growth for fiscal 2026. He highlighted strong momentum from stable utilization, the successful onboarding of new customers, and robust growth in specialty and oncology, further boosted by the acquisitions of Prism Vision and Core Ventures, which are expected to contribute 6-7% to the segment's operating profit growth.

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CEO Brian Tyler explained that the pharmaceutical business model is largely insulated due to reimbursement mechanisms, and the generic sourcing program is well-diversified. He noted the medical-surgical business also has a diversified sourcing strategy and pricing flexibility. CFO Britt Vitalone confirmed that based on current understanding, tariffs are not expected to have a material impact on fiscal 2026 guidance.

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CFO Britt Vitalone specified that his comment pertained to a single product that went biosimilar, leading to a formulary change by a large retail national customer. He characterized it as a revenue impact for McKesson and noted it was the same issue that had been called out in previous quarters, declining to comment on future product shifts.

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CFO Britt Vitalone stated it was too early to change long-term targets for the Medical segment, noting its supplier base is diversified away from heavy China concentration. He attributed strong pharma growth to factors including GLP-1s and specialty drugs. He clarified that McKesson manages inventory based on demand, couldn't speak for Eli Lilly, confirmed the Rexall exit's impact is immaterial, and expressed high confidence in the back-half forecast.

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EVP & CFO James Cleary explained that the U.S. revenue moderation was due to biosimilars, decelerating (though still strong) GLP-1 growth, and the loss of a high-revenue, low-margin grocery customer. He credited the robust operating income growth to strong performance in higher-margin areas like specialty sales to physicians and health systems. For the international segment, Cleary noted that subdued clinical trial activity has pressured the global specialty logistics and consulting businesses, but he expects sequential improvement and a return to growth in Q4, citing positive leading indicators.

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CFO Jim Cleary stated that Cencora has not identified any material impact from tariffs, as pharmaceutical manufacturers are the importer of record. He emphasized that the company's primary focus is on ensuring patient access and supporting its partners through any uncertainty.

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CFO James Cleary clarified that the guidance assumes GLP-1 growth was higher in Q1 than it will be for the rest of the year, a factor that significantly impacts revenue but has a minimal effect on operating income. He also noted that the newly acquired RCA is a higher-margin, lower-revenue business, and intercompany revenue is eliminated, further explaining the guidance.

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CEO Bob Mauch stated that Cencora's successful strategy will not change but will be amplified, with a continued focus on execution, talent, and customer-centricity. He affirmed the company's readiness to work with any political administration and navigate policy changes, ensuring they remain a supportive partner for customers.

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CFO Jeff Schwaneke confirmed the company ended the quarter with $327 million in cash and securities, plus $176 million in off-balance-sheet cash held by ACO entities. He expressed confidence that this liquidity provides the flexibility needed to navigate the current challenges and is sufficient to get through 2026, excluding any additional cash flow improvement initiatives.

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CEO Steven Sell clarified that medical cost trends were in line with their elevated expectations. He highlighted that a new financial data pipeline went live in Q1, significantly improving visibility. He noted inpatient census was high in Jan/Feb but declined in March. CFO Jeffrey Schwaneke added that Part D exposure is under 30% and not a significant driver of financial results.

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CEO Steven Sell explained that the 40% of membership up for renewal is seeing improved percentage-of-premium terms and new upside incentives for quality performance. He added that for Part D risk, which spans more than just that 40%, over half the membership will have risk mitigation structures like carve-outs or corridors in 2025. Sell also noted that new Year 1 partners are being offered alternative economic arrangements, such as no-downside care management fees, to ensure proper data integration before taking on full risk.

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President and COO Brian Evanko reported strong PBM client retention tracking at mid-90% or better for 2026, highlighting the Prime Therapeutics renewal and noting affordability remains the top client concern. Chairman and CEO David Cordani stated Cigna was pleased with the temporary restraining order against the Arkansas law, arguing it would restrict access and raise costs, while reaffirming a commitment to public-private partnerships to navigate the active regulatory environment.

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President and COO Brian Evanko explained that Cigna's GLP-1 strategy is a comprehensive suite of programs (EnCircleRx, EnreachRx, ENGUIDE) focused on access, affordability, and clinical safety, rather than just formulary placement. He noted over 50% of Evernorth employers and 15-20% of Cigna Healthcare employers cover weight management drugs. Chairman and CEO David Cordani stated that Cigna opposes the Arkansas bill, arguing it limits choice, erodes quality, and increases costs, while noting Arkansas is a small market for the company.

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CEO David Cordani stated the new offerings do not change the company's profit model, emphasizing that the vast majority of rebates are already passed through to clients. Eric Palmer, CEO of Evernorth, added that the new programs, which ensure patients benefit from negotiated discounts, will become the default offering. He noted that while clients retain choice, the value of rebates shared with them continues to increase.

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Evernorth CEO Eric Palmer described the 2025 selling season as good, with retention rates in the mid-to-high 90s, and noted no wholesale changes in contract structures. CEO David Cordani stated that Cigna disagrees with the FTC's assertions, sees no mature legislation that appears likely to be put forward currently, and remains confident in the durability of the PBM model.

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CEO David Joyner expressed satisfaction with the Aetna business's recovery. CFO Brian Newman detailed the Q2 results, noting a $300M favorable risk adjustment and a $470M group MA PDR, with the underlying beat driven by Medicare Part D and supplementals. EVP & President - Aetna, Steve Nelson, highlighted operational improvements, strong 2025 STARS ratings, and a disciplined approach to repricing the group MA business, half of which is up for renewal in 2026.

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President and CEO David Joyner framed the deal as a key innovation for clients. Prem Shah, EVP and Chief Pharmacy Officer, explained that the partnership makes Wegovy preferred on CVS's largest commercial template, covering tens of millions of lives, to improve affordability and access, as about one-third of clients currently do not cover GLP-1s due to cost. He highlighted the value of the integrated CVS weight management program and the new retail access through the NovoCare Pharmacy network, which will drive value for clients and members.

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President and CEO David Joyner highlighted his focus on stabilizing Aetna's operations, advancing pharmacy transformation through models like CostVantage and TrueCost, and establishing the right leadership team. CFO Tom Cowhey added that the 2025 guidance is an achievable baseline with the most significant opportunity for upside residing in the Health Care Benefits segment, contingent on the moderation of medical cost trends.

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Tom Cowhey, CFO, stated that early indicators suggest a 5% to 10% membership decline, in line with guidance. He expressed confidence in the 2025 bids, citing an approximate $800 million tailwind from improved Star ratings and deliberate benefit design changes. CEO J. Joyner added that the company anticipated pharmacy cost shifts and is focused on better integrating medical and pharmacy benefits to manage costs.

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CEO Charles Divita identified continued improvements in access and partnering more closely with local delivery systems as key opportunities. He emphasized extending longitudinal care to complement the existing system. Regarding the forum, he noted clients are concerned about affordability and provider shortages, and there was strong interest in Teladoc's strategic direction and deepening partnerships.

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CEO Chuck Divita confirmed a gradual market shift toward visit-based contracts, highlighting visit volume as a key engagement metric. CFO Mala Murthy added that utilization trends are stable, noting that 6% visit volume growth in 2024 translated to high single-digit visit revenue growth, a momentum she expects to continue into 2025.

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CEO Chuck Divita identified the health plan space as the primary source of headwinds due to market pressures and significant 'belt tightening,' which affects bookings across the board, including for Chronic Care Management. CFO Mala Murthy noted the selling season is ongoing and that revenue growth has multiple levers beyond bookings, such as driving enrollment, visit volume, and strategic pricing.

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President, CEO, and Chairman Adam Schechter stated that LabCorp renews 20-25% of its managed care contracts annually and continues to see relatively flat unit pricing. He expressed confidence in securing renewals on reasonable terms that support the company's guidance. He also noted that hospital acquisition deals strengthen their position with payers by demonstrating value and helping to lower overall healthcare costs.

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Chairman and CEO Adam Schechter explained that Labcorp is actively developing non-animal testing models. He noted that the specific area of monoclonal antibodies, which has been a focus of discussion, represents only 10-15% of the Biopharma Laboratory Services segment's revenue. He concluded that the total enterprise impact would be very small and that no significant financial effect is expected this year.

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CEO Adam Schechter clarified that high growth (3x normal) is concentrated in specific esoteric areas like oncology and women's health. He believes Labcorp is gaining market share, allowing for growth above the historical 1-2% market rate. Regarding the LDT rule, Schechter stated that while he believes it's bad for the industry, the direct financial impact to Labcorp is not significant as the company already complies with similar standards for New York State approval.

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CEO Adam Schechter confirmed the Invitae integration is on track and is expected to be slightly accretive in 2025. CFO Glenn Eisenberg elaborated that margins will improve sequentially but remain a year-over-year headwind through H1 2025 before becoming a tailwind. He attributed the strong 3% organic price/mix growth to lab management agreements, an increase in tests per accession, and esoteric testing growing faster than routine testing.

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CFO Celeste Mellet confirmed that trends are developing as expected, with data through April showing no cause for concern. Regarding cadence, she explained that earnings will be front-loaded due to the IRA, with Q1 being the highest. She also noted that the full-year guidance anticipates a 'dock 6' impact in late Q3 or Q4, which is factored into the outlook.

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CFO Michael Shapiro explained that Q1 can be unpredictable and cautioned against extrapolating the results. He noted that while acute growth was robust, a significant negative impact from the Stelara pricing reset is still expected in subsequent quarters. CEO John Rademacher added that while it's early, he expects changes to patient out-of-pocket costs to be a net benefit later in the year by potentially reducing bad debt.

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CFO Michael Shapiro explained that while Intramed was acquired at a mid-teens multiple, Option Care Health is confident it can improve this to a low double-digit multiple by applying its superior procurement leverage, technology, and operational efficiencies. On M&A strategy, Shapiro and CEO John Rademacher stated they are not capital constrained but are highly disciplined, focusing on acquisitions that add sustainable strategic value or unique capabilities, like Intramed's advanced practitioner model. They view share repurchases as a strong alternative for capital deployment.

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CEO John Rademacher explained the uniqueness stems from STELARA being part of the Inflation Reduction Act's (IRA) first drug negotiation cohort, creating a different dynamic. He noted most of the company's portfolio is already generic or biosimilar. CFO Michael Shapiro confirmed that the IV bag shortage and disruptions from recent hurricanes were the primary variables affecting the Q4 guidance.

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CEO Andrew Witty expressed that while the final V28 step-down is a known factor for next year, the company is nearing the end of absorbing the pricing pressure. He was encouraged by the 2026 rate notice reflecting cost trends more accurately. Witty conveyed confidence that the issues seen in early 2025 are addressable within the year, setting the stage for stronger 2026 performance and a return to the target growth trajectory.

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CEO Andrew Witty stated that PBMs are the primary check on high drug prices set by manufacturers. To improve transparency and address criticism, he announced that Optum Rx is committed to phasing out remaining arrangements to achieve 100% pass-through of all negotiated rebates to clients by 2028 at the latest. This move is intended to focus the policy debate on the drug manufacturers who set the initial prices.

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John Rex, President & CFO, noted the specialty drug cost acceleration was sharper than anticipated, partly due to IRA-related manufacturer campaigns. Brian Thompson, CEO of UnitedHealthcare, stated that while the acceleration was early, they feel adequately priced for 2025. Patrick Conway, CEO of Optum Rx, highlighted strong PBM selling season results, growth in specialty and infusion services, and new cost-saving products as key drivers for the segment.

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CEO Tim Wentworth explained that new reimbursement contracts, covering a meaningful portion of their business, involve rebalancing brand and generic drug reimbursements and creating new categories for high-cost drugs like GLP-1s to better align with acquisition costs. He noted that while they have made progress, about two-thirds of contracts remain to be addressed over time. Regarding script retention from the 70 stores closed in the quarter, Wentworth confirmed it was better than internal assumptions but did not provide a specific number, attributing the success to an improved patient transfer process.

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CEO Tim Wentworth explained that WBA is in a multi-year process to reframe PBM relationships, resulting in less reimbursement pressure in fiscal 2025. He confirmed WBA is willing to exit unprofitable network contracts to protect margins. Global CFO Manmohan Mahajan added that the earnings cadence for 2025 will be similar to recent years, with benefits from store closures scaling up in the second half.

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CEO Tim Wentworth explained that while reimbursement pressure is lessening in 2025, it's part of a multi-year reset of PBM relationships. He confirmed Walgreens is willing to exit unprofitable networks to ensure fair compensation. CFO Manmohan Mahajan added that the FY25 earnings cadence would likely follow trends from the past couple of years, with benefits from store closures scaling up through the year.

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CEO Tim Wentworth outlined a future pharmacy model with a rationalized store footprint, deeper brand partnerships, and an enhanced loyalty program. Mary Langowski, President of U.S. Healthcare, added that discussions with payers focus on fair compensation for the value pharmacists provide, as the current model is outdated. CFO Manmohan Mahajan clarified the $20 million NADAC impact was for a partial quarter and its volatility contributes to the wider guidance range.

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CEO Tim Wentworth outlined a future for pharmacy focused on a rationalized store footprint, deeper brand partnerships, an enhanced loyalty program, and back-end automation. President of U.S. Healthcare Mary Langowski added that current reimbursement playbooks are dated and they are focused on being paid fairly. Global CFO Manmohan Mahajan clarified the $20 million NADAC impact was for a partial quarter and its volatility contributes to the wider Q4 guidance range.

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CEO Jim Davis explained that Canada's demographics are favorable due to higher population growth and an older average population compared to the U.S., both of which drive higher lab utilization. He reiterated that LifeLabs' operating margin rate is currently below Quest's average but is expected to reach the company average within a few years through synergies.

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