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News > Companies
McKesson to supply ASC
June 30, 1998: 9:44 a.m. ET

Wholesaler will provide $1.9B a year in drugs to American Stores Co.
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NEW YORK (CNNfn) - Drug wholesaler McKesson Corp. said Tuesday it has agreed to a supply deal valued at $1.9 billion for American Stores Co.'s 1,100-store chain of drug and food stores.
     San Francisco-based McKesson said it will become the sole drug supplier for ASC's American Drug Stores unit, buying $1.5 billion a year in drugs for the chain and helping to manage its inventory and productivity.
     McKesson also said it expects $400 million in revenues from direct store deliveries.
     The drug distributor currently has revenues of more than $70 million a year from distribution to American Stores' Osco Drug chain.
     The new agreement, which has an initial five-year term, is expected to take effect Aug. 1.
     McKesson also said it will provide value-added services and technologies to improve operations for American Drug Stores.
     The alliance comes about a month after McKesson, the nation's largest wholesale drug distributor, announced it had signed a five-year $5 billion contract to supply both products and services to giant hospital chain Columbia/HCA Healthcare.
     Salt Lake City, Utah-based American Drug Stores is one of the nation's largest food and drugstore chains, operating 596 Osco drugstores, 354 Sav-on drugstores and more than 150 pharmacies in Lucky and Acme food stores.
     Shares of American Stores (ASC) fell 3/8 to 23-9/16 while McKesson shares (MCK) rose 2-3/8 to 83-1/2. Back to top

  RELATED STORIES

McKesson signs $5 billion supply pact with Columbia - May 28, 1998

Drug firms facing stress - Feb. 24, 1998

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McKesson

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Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer. Morningstar: © 2018 Morningstar, Inc. All Rights Reserved. Factset: FactSet Research Systems Inc. 2018. All rights reserved. Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor's Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2018 and/or its affiliates.