## Pharmaceutical Technologies and Services 

In 2000, we for mulated, manufactured and packaged more than 6,000 pr oducts on behalf of phar maceutical and biotech companies worldwide. 

In the past year, Cardinal’s Pharmaceutical Technologies and Services businesses formulated, manufactured and packaged more than 6,000 products on behalf of hundreds of pharma- ceutical and biotechnology companies worldwide, including the world’s 20 largest pharmaceutical manufacturers. Since 1997, Cardinal has been developing a global, integrated approach for pharmaceutical product development, manufac- turing, packaging and sales and marketing suppor t, featuring proprietary processes and technologies unavailable from any other single source. Manufacturers’ expenditures for such services are currently estimated at $8 billion annually, increasing at more than 15% a year. 

A number of factors are responsible for this trend. First, the high cost of developing new dr ugs and increased public focus on drug pricing are driving pharmaceutical companies to seek more efficient means to develop and manufactur e products. Second, greater consolidation of the pharmaceuti- cal industry is prompting companies to pursue cost savings by forming strategic partnerships to accomplish activities that are not core competencies. Third, reducing the amount of time to launch a new dr ug can greatly improve its prof- itability. CenterWatch research estimates that a single day’s delay results in approximately $1.3 million in lost pr escrip- tion sales for an average pr oduct, and up to 10 times that amount for a blockbuster drug. Fourth, many of today’s new drugs are more complicated, requiring non-traditional formu- lations to enable effectiveness. Finally, biotech companies are beginning to receive an increasing number of drug approvals, but are not investing in the infrastr ucture to man- ufacture, package, distribute and market those pr oducts. 

Cardinal Health has built leadership positions in busi - nesses that provide comprehensive, integrated services for 

Cardinal’s Pharmaceutical Technologies and Services segment includes four principal businesses: R.P. Scherer Corporation develops and manufactures drug-delivery systems including proprietary soft-gelatin capsules, rapid-dissolve tablets (Zydis$^{®}$) and topical technologies. The company oper - ates 15 plants in 10 countries. Automatic Liquid Packaging is the largest producer of sterile liquid pharmaceuticals. The company’s unique, patented “blow-fill-seal” process produces these products in topical, inhaled and ophthalmic formulations. PCI Services is the world’s leading provider of integrated contract packaging services, operating 16 facilities in the United States, Puerto Rico, the United Kingdom and Germany. Lastly, Cardinal Health Sales and Marketing Services provides high-quality contract sales and marketing expertise as well as strategic and tactical planning, pr oduct management and general consulting services to pharmaceuti- cal, biotechnology and medical-surgical companies. 

For a company developing a new dr ug, these services mean that it need only go to one ser vice provider – Cardinal – to enhance a product’s performance and bring it to market faster and more cost-effectively. For Cardinal, these busi- nesses provide an important portfolio of services to offer its pharmaceutical manufacturer and biotech partners, and an exciting new avenue for gr owth. 

