Bergen Brunswig and Costco Wholesale Enter Into Strategic Partnership
Under terms of the agreement, which is expected to generate revenues of $220 million to Bergen over the life of the contract, BBDC will supply all generic pharmaceuticals to Costco's 240 locations and also provide back-up service to Costco's primary branded pharmaceutical wholesaler. Bergen's Infinity Fulfillment Center will also provide Home Health Care items to members shopping on Costco.com and Costco will enter into a strategic partnership with the Pharmacy Benefit Management program, which will assist uninsured Costco members.
"Costco is one of the fastest growing companies in the country," said David Neu, president, BBDC Retail. "This partnership will provide Costco with business solutions designed to enhance and expand margin contributing categories."
Costco has also committed to employ Bergen's Generic Purchasing Program (GPP) for the procurement of their generics. GPP, the industry's most successful generic program, combines the power of over 9,000 pharmacies and will enable them to vastly improve their buying power.
Charles Burnett, Senior Vice President of Costco added, "By implementing a discovery process which enabled them to understand the goals of our pharmacies, Bergen was able to propose programs that will positively enhance the value to Costco members."
Costco Wholesale Corporation operates an international chain of membership warehouses, mainly under the "Costco Wholesale" name, that carry quality, brand name merchandise at substantially lower prices than are typically found at conventional wholesale or retail sources. The warehouses are designed to help small-to-medium-sized businesses reduce costs in purchasing for resale and for everyday business use. Individuals belonging to certain qualified groups are also able to purchase for their personal needs.
Bergen Brunswig Corporation, headquartered in Orange County, California, is a leading supplier of pharmaceuticals and specialty healthcare products, as well as information management solutions and consulting services. Bergen's customers include the nation's healthcare providers (hospitals, nursing homes and physicians), drug stores, manufacturers and patients. Through its subsidiaries, Bergen provides product distribution; logistics; pharmacy management programs; and Internet fulfillment strategies designed to reduce costs and improve patient outcomes across the entire healthcare spectrum.
Except for historical information, all other information set forth in this press release, such as earnings forecasts and earnings rate projections, consists of "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These "forward-looking statements" are subject to risks, uncertainties and other factors which could cause actual results to differ materially from those projected or implied. Such statements may be identified by the use of forward-looking language such as "may," "will," "should," "expect," "anticipate," "estimate," "believe," "think," "continue" or the negatives or other variations thereof or other similar terminology. Such risks and uncertainties include the risks described in exhibit 99(a) to the Company's Annual Report on Form 10-K for the year ended September 30, 2000 and in other reports and exhibits filed with the Securities and Exchange Commission. These risks and uncertainties include, but are not limited to, the costs and difficulties related to the integration of acquired businesses, the loss or disruption of one or more key customer or supplier relationships, changes in the distribution outsourcing pattern for pharmaceutical products and/or services, the ability to obtain general financing or financing rates that would be compatible with the Company's business operations, and the costs and other effects of governmental regulation and legal and administrative proceedings. The Company assumes no obligation to update the information in the release.
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