McKesson Corp Files 2024 10-K

TL;DR

McKesson's 2024 10-K is in. All systems go for drug distribution giant.

AI Summary

McKesson Corporation filed its 10-K for the fiscal year ending March 31, 2024, reporting on its operations in wholesale drug distribution and related services. The company's financial performance and strategic initiatives are detailed, including its significant market presence and ongoing business developments. McKesson continues to navigate the complex healthcare landscape, focusing on efficiency and growth.

Why It Matters

This filing provides investors and analysts with a comprehensive overview of McKesson's financial health, operational strategies, and risk factors for the past fiscal year, influencing investment decisions and market perception.

Risk Assessment

Risk Level: medium — The filing details the company's operations and financial standing, which inherently carry market, regulatory, and operational risks common to large pharmaceutical distributors.

Key Numbers

• FY 2024 — Fiscal Year (Reporting period for the 10-K)
• 0331 — Fiscal Year End (Indicates the end of the reporting period)

Key Players & Entities

• MCKESSON CORP (company) — Filer of the 10-K
• 20240331 (date) — Fiscal year end date
• 20240508 (date) — Filing date
• 6555 STATE HIGHWAY 161 (address) — McKesson's business and mailing address
• IRVING, TX 75039 (address) — McKesson's business and mailing address

FAQ

Key Financial Figures

• $0.01 — nge on which registered) Common stock, $0.01 par value MCK New York Stock Exchange
• $8.8 billion — ar, RxTS helped patients save more than $8.8 billion on brand and specialty medications, hel

Filing Documents

• mck-20240331.htm (10-K) — 3426KB
• mck_exhibit416x3312024.htm (EX-4.16) — 104KB
• mck_exhibit1022x3312024.htm (EX-10.22) — 574KB
• mck_exhibit191x3312024.htm (EX-19.1) — 104KB
• mck_exhibit192x3312024.htm (EX-19.2) — 113KB
• mck_exhibit193x3312024.htm (EX-19.3) — 87KB
• mck_exhibit194x3312024.htm (EX-19.4) — 137KB
• mck_exhibit195x3312024.htm (EX-19.5) — 29KB
• mck_exhibit21x3312024.htm (EX-21) — 7KB
• mck_exhibit23x3312024.htm (EX-23) — 3KB
• mck_exhibit311x3312024.htm (EX-31.1) — 10KB
• mck_exhibit312x3312024.htm (EX-31.2) — 10KB
• mck_exhibit32x3312024.htm (EX-32) — 9KB
• mck_exhibit97x3312024.htm (EX-97) — 34KB
• image_0.jpg (GRAPHIC) — 19KB
• image_04a.jpg (GRAPHIC) — 19KB
• image_0a.jpg (GRAPHIC) — 19KB
• mck-20240331_g1.jpg (GRAPHIC) — 11KB
• mck-20240331_g2.jpg (GRAPHIC) — 99KB
• screenshot2024-05x03114236.jpg (GRAPHIC) — 76KB
• 0000927653-24-000035.txt ( ) — 21663KB
• mck-20240331.xsd (EX-101.SCH) — 127KB
• mck-20240331_cal.xml (EX-101.CAL) — 181KB
• mck-20240331_def.xml (EX-101.DEF) — 826KB
• mck-20240331_lab.xml (EX-101.LAB) — 1485KB
• mck-20240331_pre.xml (EX-101.PRE) — 1191KB
• mck-20240331_htm.xml (XML) — 3532KB

Signatures

Signatures 136 Table of Contents

Index

Item 1 Index McKESSON CORPORATION PART I

Business

Item 1. Business. INDEX TO BUSINESS Section Page General 3 Business Segments 4 U.S. Pharmaceutical 4 Prescription Technology Solutions 7 Medical-Surgical Solutions 7 International 7 Investments, Restructuring, Business Combinations, and Divestitures 8 Competition 8 Patents, Trademarks, Copyrights, and Licenses 8 Human Capital 9 Government Regulation 10 Other Information about the Business 13

Forward-Looking Statements

Forward-Looking Statements 13 General McKesson Corporation together with its subsidiaries (collectively, the "Company," "McKesson," "we," "our," or "us" and other similar pronouns), which traces its business roots to 1833, is a diversified healthcare services leader dedicated to advancing health outcomes for patients everywhere. Our teams partner with biopharma companies, care providers, pharmacies, manufacturers, governments, and others to deliver insights, products, and services to help make quality care more accessible and affordable. The Company's fiscal year begins on April 1 and ends on March 31. Unless otherwise noted, all references in this document to a particular year refers to the Company's fiscal year. The Company was incorporated on July 7, 1994 in the State of Delaware. Our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (the "Exchange Act"), are available free of charge on the Company's website ( www.mckesson.com under the "Investors — Financials — SEC Filings" caption) as soon as reasonably practicable after such material is electronically filed with, or furnished to, the Securities and Exchange Commission ("SEC"). The content on any website referred to in this Annual Report on Form 10-K ("Annual Report") is not incorporated by reference into this report, unless expressly noted otherwise. The SEC maintains a website that contains reports, proxy and information statements, and other information regarding issuers, including the Company, that file electronically with the SEC. The address of the website is www.sec.gov . 3 Table of Contents

Index

Item 1 Index McKESSON CORPORATION Business Segments The Company operates its business in four reportable segments: U.S. Pharmaceutical, Prescription Technology Solutions ("RxTS"), Medical-Surgical Solutions, and International. Our U.S. Pharmaceutical segment distributes branded, generic, specialty, biosimilar and over-the-counter ("OTC") pharmaceutical drugs, and other healthcare-related products in the United States ("U.S."). This segment provides practice management, technology, clinical support, and business solutions to community-based oncology and other specialty practices. In addition, the segment sells financial, operational, and clinical solutions to pharmacies (retail, hospital, alternate sites) and provides consulting, outsourcing, technological, and other services. Our Prescription Technology Solutions segment helps solve medication access, affordability, and adherence challenges for patients by working across healthcare to connect patients, pharmacies, providers, pharmacy benefit managers, health plans, and biopharma. RxTS serves our biopharma and life sciences partners, delivering innovative solutions that help people get the medicine they need to live healthier lives. RxTS also offers prescription price transparency, benefit insight, dispensing support services, as well as third-party logistics and wholesale distribution support designed to benefit stakeholders. Our Medical-Surgical Solutions segment provides medical-surgical supply distribution, logistics, and other services to healthcare providers, including physician offices, surgery centers, nursing homes, hospital reference labs, and home health care agencies. We offer more than 245,000 national brand medical-surgical products as well as McKesson's own line of high-quality products through a network of distribution centers in the U.S. Our International segment provides distribution and services to wholesale, institutional, and retail customers in Canada and Europe where we own, partner, o

Index

Item 1 Index McKESSON CORPORATION Retail National Accounts: We provide business solutions that help our retail national account customers increase revenues and profitability. Solutions include: Central Fill SM – Prescription refill service that enables pharmacies to more quickly refill prescriptions remotely, more accurately, and at a lower cost, while reducing inventory levels and improving customer service. Strategic Redistribution Centers – Two facilities totaling over 740,000 square feet that offer access to inventory for single source warehouse purchasing, including pharmaceuticals and biologics. These distribution centers also provide the foundation for a two-tiered distribution network that supports best-in-class direct store delivery. McKesson SynerGx – Generic pharmaceutical purchasing program and inventory management that helps pharmacies maximize their cost savings with a broad selection of generic drugs, competitive pricing, and one-stop shopping. Inventory Management – An integrated solution comprised of forecasting software and automated replenishment technologies that reduce inventory-carrying costs. ExpressRx Track – Pharmacy automation solution featuring state-of-the-art robotics, upgraded imaging, and expanded vial capabilities, and industry-leading speed and accuracy in a small footprint. Community Pharmacy and Health: We strengthen the overall health of community pharmacies and elevate the role they play in people's lives. We accomplish this by providing supply chain excellence, pharmacy and patient solutions, as well as supporting independent pharmacies through industry and legislative advocacy. Our pharmacy and patient solutions include: Health Mart – A national network of approximately 4,500 independently-owned pharmacies and one of the industry's most comprehensive pharmacy franchise programs. Health Mart provides franchisees support for operational excellence, managed care contracting, marketing, merchandising solutions, and clin

Index

Item 1 Index McKESSON CORPORATION McKesson Plasma and Biologics – Specialty and plasma drug distributor that leads in market exclusive drug access; partner to health systems customers in navigating the complexities of limited distribution drug; and optimization of McKesson Distribution benefits. Outpatient and Specialty Pharmacy – A portfolio of services and solutions customized to each customer's business and clinical strategy. Contracting and Contract/Purchasing Optimization – Solutions across generics, specialty, branded products, biosimilars, and 340B products, for inpatient and outpatient settings. Supply Assurance – Solutions and strategies to enhance product availability and proactively manage inventory of critical items. Patient Assistance Solutions – Technologies and services that enable health systems and providers to better financially support their patients and community benefit programs. The U.S. Pharmaceutical segment also offers solutions which enable its customers to drive greater efficiencies in their day-to-day operations, effectively managing their inventories and complying with complex government regulations. Solutions include McKesson Pharmacy Systems, MacroHelix, and Supply Logix, all of which provide innovative software technology and services that support retail pharmacies and hospitals. Oncology, Biopharma, and Other Specialty Partners: The U.S. Pharmaceutical segment provides a range of solutions to oncology and other specialty practices and offers community specialists (oncologists, rheumatologists, ophthalmologists, urologists, neurologists, and other specialists) an extensive set of customizable solutions and services designed to strengthen core practice operations, enhance value-based care delivery, and expand their service offering to patients. Community-based physicians in this business have broad flexibility and discretion to select the products and commitment levels that best meet their practice needs. Services in provid

Index

Item 1 Index McKESSON CORPORATION Prescription Technology Solutions Segment: Our Prescription Technology Solutions segment works across healthcare to connect patients, pharmacies, providers, pharmacy benefit managers, health plans, and biopharma to deliver medication access solutions that support patients from first prescription fill to ongoing therapy, regardless of their insurance coverage. RxTS has connections with most electronic health record systems, over 50,000 pharmacies, approximately 950,000 providers, most pharmacy benefit managers and health plans, and has supported over 650 biopharma brands representing most therapeutic areas. Through its industry connections and ability to navigate the healthcare ecosystem, RxTS offers innovative solutions created to benefit healthcare stakeholders. Its comprehensive solution suites span across the entire patient journey, including medication access and affordability, prescription decision support, prescription price transparency, benefit insight and dispensing support services, as well as third-party logistics and wholesale distribution support, to help increase speed to therapy, reduce prescription abandonment, and support improved health outcomes for the patient. In the past year, RxTS helped patients save more than $8.8 billion on brand and specialty medications, helped to prevent an estimated 10.7 million prescriptions from being abandoned due to affordability challenges, and helped patients access their medicine more than 94 million ti mes. Medical-Surgical Solutions Segment: Our Medical-Surgical Solutions segment delivers medical-supply distribution, logistics, biomedical maintenance, and other services to healthcare providers across the alternate-site spectrum. Our more than 285,000 customers include physician offices, surgery centers, post-acute care facilities, hospital reference labs, and home health agencies. We partner with manufacturers and channel partners to support our key target end-markets, i

Index

Item 1 Index McKESSON CORPORATION In July 2021, we announced our intention to exit our businesses in Europe. We divested the majority of our European businesses during fiscal 2022 and fiscal 2023. Our remaining operations in Europe provide distribution and services to wholesale and retail customers in Norway where we own, partner, or franchise with retail pharmacies. We continue to evaluate suitable exit alternatives for our retail and distribution businesses in Norway. Refer to Financial Note 2, "Business Acquisitions and Divestitures," to the consolidated financial statements included in this Annual Report for additional information on our European divestitures . Investments, Restructuring, Business Combinations, and Divestitures We invest in new and existing distribution centers to increase scale and capacity, improve efficiency through automation and technology, and enhance regulatory compliance capabilities. Additionally, we invest in data and analytics to support our growth priorities, including artificial intelligence ("AI"). We are in the early stages of exploring potential AI capabilities and related data and analytics across our enterprise to improve productivity and efficiency, as well as enhance our products and services to better support patients, employees, and customers. We have undertaken additional strategic initiatives in recent years designed to increase operational efficiencies, focus on our core healthcare businesses, execute our business strategy, and enhance our competitive position. These initiatives are detailed in Financial Note 2, "Business Acquisitions and Divestitures," and Financial Note 3, "Restructuring, Impairment, and Related Charges, Net," to the consolidated financial statements included in this Annual Report. Competition We operate in highly competitive environments in North America and Norway. In recent years, the healthcare industry has been subject to increasing consolidation. In the pharmaceutical distribution envi

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