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## How we will grow our Automation and Information Services business: 

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Services group remains a leader in its r espective markets. In fiscal 2000, we: 

• Developed and launched seven new Pyxis pr oducts, 

• Acquired and successfully integrated two impor tant product lines, 

• Introduced the Pyxis SAFETYnet™ program – a package of leading-edge products and services that helps customers protect their patients, staff and bottom line, ® 

• Expanded our ScriptLINE business to more than 4,300 retail pharmacies, 

• Broadened Pyxis’ international effort with installations in four new countries for a total of 10 countries outside of the United States, 

• Realized numerous opportunities to cross-sell our automation and information products with other Cardinal businesses, 

• Formed a new company, Vistant Corporation, to bring Pyxis’ technologies to non-healthcare markets. 

While the current environment for hospitals and other healthcare providers is financially challenging, we r emain optimistic about the market potential for our pr oducts and services for a number of r easons: 

Solutions for Difficult Issues – We provide automation and information services that address the most press- ing issues facing healthcare providers… • Cost Reduction – Healthcare providers, faced with # 1 

declining reimbursement rates by third-party payers, are seeking to become more efficient. Our automation and information systems help to reduce inventory and labor costs by improving the utilization and control of pharmaceuticals and simplifying processes. 

• Patient Safety – Recent studies by the Quality of Health Care in America Committee and the Institute of Medicine have identified medication errors as a leading concern in the delivery of healthcare today. Proper utilization of automation systems for mor e accurate dispensing and information systems for decision support can help minimize the risk of medication er rors. 

• Staffing Shortages – Current estimates point to a severe shortage of pharmacists and nurses to support the needs of an expanding U.S. healthcar e system in the coming decade. Our automated systems help to r educe or 

During the past year, we con- tinued to invest in the unique capabilities that will ensure that the Automation and Information 

minimize certain labor-intensive tasks, resulting in better deployment of these valuable professionals. 

Industry Leadership – Cardinal’s investment in new product development has resulted in the broadest automation and information product offering in the industry. We support this effort with unparalleled commitment to customer service and education. Today, we have more than 500 customer service representatives supporting the needs of our customers nationwide. Our educational alternatives are the most flexible and comprehensive in the industry, including online training available over the Internet. # 2 

New Market Opportunities – We continue to develop automation and information systems customized for new applications, such as the r ecently intro- duced Pyxis Anesthesia System™ for operating r oom environments. In addition, we have only begun to pene - trate healthcare markets outside of the United States, which offer significant growth potential. Finally, we have a tremendous opportunity to extend our market-leading automated dispensing technologies to customers in manufacturing and industrial environments. # 3 

At Cardinal, we continuously look for new ways to improve the supply chain management pr ocess. Our ability to identify innovative ways to apply our technolo - gies to meet market needs, successfully develop and introduce new products, and provide unparalleled customer service will drive our continued leadership in this rapidly growing market. 

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