Cardinal Health boosts annual profit forecast on surging demand for specialty drugs

By Padmanabhan Ananthan

Feb 5 (Reuters) – Cardinal Health on Thursday raised its 2026 profit outlook after beating quarterly results estimates on strong demand for specialty medicines, sending shares up more than 9% in morning trading.

Drug distributors such as Cardinal Health, Cencora and McKesson are riding the wave of surging demand for high-margin medicines that treat complex conditions like cancer and autoimmune diseases, and are also benefiting from the launches of biosimilars for blockbuster drugs that have lost patent exclusivity.

The companies are also expanding their presence in the specialty medicines market by acquiring cancer center operators to diversify beyond drug distribution and complement their core businesses.

Cardinal Health CEO Jason Hollar, in a post-earnings call, downplayed GLP‑1 drugs as a meaningful profit driver even as the products continue to lift revenue, saying the company does not expect the fast-growing category to meaningfully change earnings.

“It’s just relatively unlikely that that’s going to be a big driver for underlying profitability,” Hollar said.

On oral GLP-1 drugs, Hollar said adoption remains “slow” and is unlikely to be material this fiscal year, though he expects uptake to accelerate over time.

Last month, Novo Nordisk launched a pill version of its blockbuster GLP-1 weight-loss drug Wegovy, aiming to reclaim its lead in the obesity market from rival Eli Lilly, which is expected to launch its own obesity pill in the second quarter of this year.

Cardinal expects annual adjusted per-share profit in the range of $10.15 to $10.35 per share, compared with at least $10 per share forecast previously.

Its quarterly revenue of $65.63 billion came in above analysts’ average estimate of $64.14 billion, according to LSEG data.

Adjusted profit of $2.63 per share, beat estimates of $2.36 per share.

(Reporting by Padmanabhan Ananthan in Bengaluru; Editing by Maju Samuel and Leroy Leo)