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PART I
This
Annual Report contains “forward-looking statements” within the meaning of the
Private Securities Litigation Reform Act of 1995. Forward-looking statements
relate to expectations, beliefs, future plans and strategies, anticipated events
or trends concerning matters that are not historical facts or that necessarily
depend upon future events. In some cases, you can identify forward-looking
statements by terms such as “may,” “will,” “should,” “could,” “would,” “expect,”
“plan,” “anticipate,” “believe,” “estimate,” “project,” “predict,” “potential,”
and similar expressions. Specifically, this Annual Report contains, among
others, forward-looking statements about:
·
our
expectations regarding financial condition or results of operations for
periods after December 31,
2009;
our
future sources of, and needs for, liquidity and capital
resources;
our
expectations regarding general economic and business
conditions;
our
critical accounting policies;
our
expectations regarding the size and growth of the market for our products
and services;
our
business strategies and our ability to grow our
business;
the
implementation or interpretation of current or future regulations and
legislation, particularly governmental oversight of our
business;
our
ability to maintain contracts and relationships with our customers;
and
our
ability to successfully complete the acquisition of Critical Homecare
Solutions Holdings, Inc. (“CHS”), and if completed, successfully integrate
CHS and realize the anticipated synergies of the
acquisition.
The
forward-looking statements contained in this Annual Report reflect our current
views about future events, are based on assumptions, and are subject to known
and unknown risks and uncertainties. Many important factors could cause actual
results or achievements to differ materially from any future results or
achievements expressed in or implied by our forward-looking statements. Many of
the factors that will determine future events or achievements are beyond our
ability to control or predict. Certain of these are important factors that could
cause actual results or achievements to differ materially from the results or
achievements reflected in our forward-looking statements.
The
forward-looking statements contained in this Annual Report reflect our views and
assumptions only as of the date this Annual Report is signed. The reader should
not place undue reliance on forward-looking statements. Except as required by
law, we assume no responsibility for updating any forward-looking
statements.
We
qualify all of our forward-looking statements by these cautionary statements. In
addition, with respect to all of our forward-looking statements, we claim the
protection of the safe harbor for forward-looking statements contained in the
Private Securities Litigation Reform Act of 1995.
Overview
We are a
specialty pharmaceutical healthcare organization that partners with patients,
physicians, healthcare payors and pharmaceutical manufacturers to provide access
to medications and management solutions to optimize outcomes for chronic and
other complex healthcare conditions.
Our
business is reported under two operating segments: (i) Specialty Pharmacy
Services, and (ii) Traditional Pharmacy Services. Our Specialty
Pharmacy Services segment includes comprehensive support, dispensing and
distribution, patient care management, data reporting, as well as a range of
other complex therapy management services for certain chronic and acute health
conditions. The medications we dispense include oral, injectable and
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infusible
medications which are used to treat patients living with chronic and other
complex health conditions. Our Traditional Pharmacy Services segment
consists mainly of traditional mail service pharmacy fulfillment, and to a
lesser extent, prescription discount card programs and fully funded pharmacy
benefit management (“PBM”) services.
In the
quarter ended September 30, 2009, we renamed the reportable segment formerly
known as “PBM Services” to “Traditional Pharmacy Services”. Our
decision to rename this segment reflects a shift in the nature of the business
included within this segment away from fully funded pharmacy benefit management
services and more towards traditional mail services and prescription discount
card programs.
Revenues
from Specialty Pharmacy Services and Traditional Pharmacy Services are derived
from our relationships with healthcare payors including managed care
organizations, government-funded and/or operated programs, third party
administrators (“TPAs”) and self-funded employer groups (collectively, “Plan
Sponsors”), as well as from our relationships with pharmaceutical manufacturers,
patients and physicians.
Our
Specialty Pharmacy Services are marketed and/or sold to Plan Sponsors,
pharmaceutical manufacturers, physicians, and patients, and target certain
specialty medications that are used to treat patients living with chronic and
other complex health conditions. These services include the distribution of
biotech and other high cost injectable, oral and infusible prescription
medications and the provision of therapy management services.
Our
Traditional Pharmacy Services are marketed and/or sold to Plan Sponsors and are
designed to promote a broad range of cost-effective, clinically appropriate
pharmacy services through our own mail service distribution facility and
national pharmacy retail network. We also administer prescription discount card
programs on behalf of commercial Plan Sponsors, most typically TPAs. Under such
programs we derive revenue on a per claim basis from the dispensing network
pharmacy.
Our
Specialty Pharmacy Services business consists of our comprehensive specialty
pharmacy distribution and therapy management services. Specialty
Pharmacy Services distribution occurs locally through our BioScrip community
pharmacies, centrally through our mail order facilities and through our infusion
pharmacies for patients requiring infused medications either in the home or at a
variety of sites including the Company’s ambulatory treatment
centers. All Specialty Pharmacy Services target certain specialty
medications that are used to treat patients living with chronic and other
complex healthcare conditions.
We own
and operate 43 specialty pharmacies comprised of community pharmacies, located
in major metropolitan areas across the United States; mail order pharmacies; and
infusion pharmacies. While all of our locations are full-service pharmacies that
carry both traditional and specialty medications and are able to treat people
with a variety of diseases and medical conditions, we primarily focus on serving
patient populations with chronic health conditions, including:
Dermatology
Psoriasis
Endocrinology
Growth
Hormones, Thyroid Cancer
Hematology
Sickle
Cell Anemia/Thalassemia, Myelodysplastic Syndromes, Bleeding
Disorders/Hemophilia
Neurology
Multiple
Sclerosis, Neuropathies
Oncology
In
office infusions, Oral Oncolytics, supportive
medications
Rheumatology/Orthopedic
Rheumatoid
Arthritis, Osteoarthritis,
Osteoporosis