PharMerica Inc., a pharmacy services company being purchased by drug wholesaler Bergen Brunswig Corp., said fourth-quarter profit fell 23% as it restructured to deal with Medicare changes.
PharMerica, based in Tampa, Fla., said net income fell to $5.82 million, or 7 cents a share, from $7.56 million, or 9 cents, a year earlier. It was expected to earn 5 cents, the average estimate of six analysts surveyed by First Call Corp. Revenue rose 17% to $293.8 million.
PharMerica, which was formed in December 1997 in a merger, is to be purchased by Orange-based Bergen Brunswig for $1.24 billion in stock and debt. PharMerica, the second-largest provider of pharmacy products and services to hospitals and nursing homes, said it started cutting costs in the third quarter as it prepared for its customers' transition to a fixed reimbursement system for Medicare, the federal health insurance plan for the elderly.
Bergen Brunswig and PharMerica shareholders will vote on the transaction April 22. The purchase calls for Bergen Brunswig to issue 25 million new shares, exchanging 0.275 of a share for every PharMerica share. It will also assume $580 million in PharMerica debt.