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McKesson's (MCK) Latest Launch to Give Access to OTC Products
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McKesson Corporation (MCK - Free Report) announced the launch of its curated private brand of over-the-counter (OTC) health and wellness products, Foster & Thrive. The launch, expected to unify the company’s private brand portfolio, will consolidate Health Mart and Sunmark branded OTC products.
The latest launch of the private brand is expected to significantly strengthen McKesson’s Pharmacy & Healthcare Solutions business.
Significance of the Launch
Per Consumer Healthcare Products Association’s estimates, the majority of customers use OTC medicines to address their symptoms for various illnesses. Additionally, consumers increasingly turn to private-label OTC products to manage their health, driven by factors like price and recognizing that quality is equivalent to national brands.
The consolidation of Health Mart and Sunmark branded OTC products will offer expanded availability via increased production volumes and efficiencies that will likely help meet evolving patient needs and growing demand.
Per management, Foster & Thrive is expected to offer pharmacists and their customers selectively sourced products that meet expected quality standards. Management also believes that customers can easily find the products they need and work.
Industry Prospects
Per a report by Research and Markets, the global OTC consumer health products market was estimated to be $179.6 billion in 2021 and is anticipated to reach $231.7 billion in 2027 at a CAGR of 4%. Factors like rising awareness of lifestyle diseases and increasing disposable income of the consumers are expected to drive the market.
Given the market potential, the recent launch is expected to boost McKesson’s position in the OTC space.
Notable Developments
Last month, McKesson announced its fourth-quarter fiscal 2023 results, wherein it registered a solid uptick in its top and bottom lines. Revenues in its U.S. Pharmaceutical segment were also strong in the quarter, driven by an increased volume of specialty products, including higher volumes from retail national account customers and market growth.
In April, McKesson announced that its independent specialty pharmacy specializing in oncology and rare disease areas, Biologics by McKesson, was selected by Reata Pharmaceuticals as the sole specialty pharmacy provider for SKYCLARYS (omaveloxolone).
Price Performance
Shares of the company have gained 27.5% in the past year compared with the industry’s 18.9% growth and the S&P 500's 13.3% rise.
Image Source: Zacks Investment Research
Zacks Rank & Key Picks
Currently, McKesson carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader medical space are Hologic, Inc. (HOLX - Free Report) , HealthEquity, Inc. (HQY - Free Report) and Boston Scientific Corporation (BSX - Free Report) .
Hologic, carrying a Zacks Rank #2 (Buy) at present, has an estimated growth rate of 5.1% for fiscal 2024. HOLX’s earnings surpassed estimates in all the trailing four quarters, the average being 27.3%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Hologic has gained 16.2% compared with the industry’s 10.8% rise in the past year.
HealthEquity, sporting a Zacks Rank #1 at present, has an estimated long-term growth rate of 22%. HQY’s earnings surpassed estimates in three of the trailing four quarters and missed once, the average surprise being 9.1%.
HealthEquity has lost 8.4% compared with the industry’s 22.2% decline over the past year.
Boston Scientific, carrying a Zacks Rank #2 at present, has an estimated long-term growth rate of 11.5%. BSX’s earnings surpassed estimates in two of the trailing four quarters and missed in the other two, the average surprise being 1.9%.
Boston Scientific has gained 42.7% against the industry’s 22.6% decline over the past year.
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McKesson's (MCK) Latest Launch to Give Access to OTC Products
McKesson Corporation (MCK - Free Report) announced the launch of its curated private brand of over-the-counter (OTC) health and wellness products, Foster & Thrive. The launch, expected to unify the company’s private brand portfolio, will consolidate Health Mart and Sunmark branded OTC products.
The latest launch of the private brand is expected to significantly strengthen McKesson’s Pharmacy & Healthcare Solutions business.
Significance of the Launch
Per Consumer Healthcare Products Association’s estimates, the majority of customers use OTC medicines to address their symptoms for various illnesses. Additionally, consumers increasingly turn to private-label OTC products to manage their health, driven by factors like price and recognizing that quality is equivalent to national brands.
The consolidation of Health Mart and Sunmark branded OTC products will offer expanded availability via increased production volumes and efficiencies that will likely help meet evolving patient needs and growing demand.
Per management, Foster & Thrive is expected to offer pharmacists and their customers selectively sourced products that meet expected quality standards. Management also believes that customers can easily find the products they need and work.
Industry Prospects
Per a report by Research and Markets, the global OTC consumer health products market was estimated to be $179.6 billion in 2021 and is anticipated to reach $231.7 billion in 2027 at a CAGR of 4%. Factors like rising awareness of lifestyle diseases and increasing disposable income of the consumers are expected to drive the market.
Given the market potential, the recent launch is expected to boost McKesson’s position in the OTC space.
Notable Developments
Last month, McKesson announced its fourth-quarter fiscal 2023 results, wherein it registered a solid uptick in its top and bottom lines. Revenues in its U.S. Pharmaceutical segment were also strong in the quarter, driven by an increased volume of specialty products, including higher volumes from retail national account customers and market growth.
In April, McKesson announced that its independent specialty pharmacy specializing in oncology and rare disease areas, Biologics by McKesson, was selected by Reata Pharmaceuticals as the sole specialty pharmacy provider for SKYCLARYS (omaveloxolone).
Price Performance
Shares of the company have gained 27.5% in the past year compared with the industry’s 18.9% growth and the S&P 500's 13.3% rise.
Image Source: Zacks Investment Research
Zacks Rank & Key Picks
Currently, McKesson carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader medical space are Hologic, Inc. (HOLX - Free Report) , HealthEquity, Inc. (HQY - Free Report) and Boston Scientific Corporation (BSX - Free Report) .
Hologic, carrying a Zacks Rank #2 (Buy) at present, has an estimated growth rate of 5.1% for fiscal 2024. HOLX’s earnings surpassed estimates in all the trailing four quarters, the average being 27.3%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Hologic has gained 16.2% compared with the industry’s 10.8% rise in the past year.
HealthEquity, sporting a Zacks Rank #1 at present, has an estimated long-term growth rate of 22%. HQY’s earnings surpassed estimates in three of the trailing four quarters and missed once, the average surprise being 9.1%.
HealthEquity has lost 8.4% compared with the industry’s 22.2% decline over the past year.
Boston Scientific, carrying a Zacks Rank #2 at present, has an estimated long-term growth rate of 11.5%. BSX’s earnings surpassed estimates in two of the trailing four quarters and missed in the other two, the average surprise being 1.9%.
Boston Scientific has gained 42.7% against the industry’s 22.6% decline over the past year.