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McKesson Extends Partnership With CDC to Fight Coronavirus

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Zacks Equity Research
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McKesson Corporation MCK recently announced that it will extend its existing partnership with the Centers for Disease Control (CDC) to help the U.S. government’s Operation Warp Speed (OWS) team. With this collaboration, McKesson will become the centralized distributor of future COVID-19 vaccines and ancillary supplies required to administer vaccinations. As directed by the U.S. government, vaccines and related supplies will be delivered to point-of-care sites across the country.

Notably, OWS is a collaboration among components of the Department of Health and Human Services (HHS) and the Department of Defense. Per the partnership, OWS deals with private firms and other federal agencies, and coordinates with the existing HHS-wide efforts to expedite development, manufacturing and distribution of COVID-19 vaccines, therapeutics and diagnostics.

The expansion of the aforementioned partnership is likely to help McKesson — a global leader in the healthcare industry — strengthen its U.S. Pharmaceutical and Specialty Solutions business.

McKesson’s Role in the COVID-19 Pandemic

McKesson has remained committed toward lending support to public health in the United States and worldwide. The company has leveraged its depth of expertise to help sustain the integrity of the healthcare supply chain, source and distribute personal protective equipment to frontline workers since the advent of the pandemic. Also, McKesson helped in setting up COVID-19 testing at Health Mart pharmacies, including many in underserved communities.

McKesson and CDC: Other Collaborations

McKesson already has an existing contract with the CDC with respect to supporting distribution as part of the CDC’s Vaccines for Children Program (VFC). Moreover, in the past, McKesson and the CDC had partnered in the same manner in response to the H1N1 pandemic.

Other Developments

McKesson is a major player in the pharmaceutical and medical supplies distribution market. It is encouraging to note that, in the fiscal fourth quarter 2019, Rite Aid renewed its 10-year distribution and sourcing relationship with McKesson, while pharmaceutical distribution relationship with CVS Health was renewed through June 2023.

Price Performance

Over the past year, shares of this Zacks Rank #3 (Hold) stock company have gained 6.6%, against the industry’s decline of 2.2%.   

Stocks to Consider

Some better-ranked stocks from the broader medical space include West Pharmaceutical Services, Inc. WST, Thermo Fisher Scientific Inc. TMO and PerkinElmer, Inc. PKI. While both PerkinElmer and West Pharmaceutical sport a Zacks Rank #1 (Strong Buy), Thermo Fisher carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

PerkinElmer has a projected long-term earnings growth rate of 17.4%.

West Pharmaceutical has a projected long-term earnings growth rate of 17.4%.

Thermo Fisher has an estimated long-term earnings growth rate of 15%.

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McKesson Corporation (MCK) : Free Stock Analysis Report
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