McKesson deepens ownership in Canadian retail pharmacy

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Pharmaceutical CommercePharmaceutical Commerce - March/April 2012

Buys marketing rights to networks of independent pharmacies for C$920 million

McKesson has signed an agreement to buy a business called Drug Trading Co. Ltd., as well as one called Medicine Shoppe Canada, from Katz Group, a privately held pharmacy network based in Edmonton, AB. Medicine Shoppe is a franchise business; while Drug Trading is a so-called banner business, offering integrated branding and business-support services to independent pharmacies operating under the names I.D.A. and Guardian. Altogether, about 850 pharmacies are affected by the action.

For its investment, however, McKesson isn’t necessarily boosting the volumes of drugs it moves through its distribution centers; the company says that it was already the primary distributor to these banner and franchise businesses, as well as Katz Group corporate-owned stores. (Apparently, Medicine Shoppe Canada, while part of the US-based Medicine Shoppe International franchise business—which is owned by Cardinal Health—has not been serviced by Cardinal.) McKesson Canada is also acquiring joint ownership of a pharmacy-management IT system called ProPharm. McKesson Canada operates a number of other banner groups, including Proxim, Associated Retail Pharmacy and Family Health Care Pharmacy.

McKesson has signed an agreement to buy a business called Drug Trading Co. Ltd., as well as one called Medicine Shoppe Canada, from Katz Group, a privately held pharmacy network based in Edmonton, AB. Medicine Shoppe is a franchise business; while Drug Trading is a so-called banner business, offering integrated branding and business-support services to independent pharmacies operating under the names I.D.A. and Guardian. Altogether, about 850 pharmacies are affected by the action.

For its investment, however, McKesson isn’t necessarily boosting the volumes of drugs it moves through its distribution centers; the company says that it was already the primary distributor to these banner and franchise businesses, as well as Katz Group corporate-owned stores. (Apparently, Medicine Shoppe Canada, while part of the US-based Medicine Shoppe International franchise business—which is owned by Cardinal Health—has not been serviced by Cardinal.) McKesson Canada is also acquiring joint ownership of a pharmacy-management IT system called ProPharm. McKesson Canada operates a number of other banner groups, including Proxim, Associated Retail Pharmacy and Family Health Care Pharmacy.

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