McKesson 2015 Annual Report Download - page 25

Download and view the complete annual report

Please find page 25 of the 2015 McKesson annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 146

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137
  • 138
  • 139
  • 140
  • 141
  • 142
  • 143
  • 144
  • 145
  • 146

McKESSON CORPORATION
integration of the two companies upon the effectiveness of the domination and profit and loss transfer agreement
(the “Domination Agreement”).
Achieving the anticipated benefits of our acquisition of Celesio is subject to a number of risks and
uncertainties, including foreign exchange fluctuations, challenges of managing new international operations, and
whether we can ensure continued performance or market growth of Celesio’s product and services. The
integration process is subject to a number of uncertainties and no assurance can be given that the anticipated
benefits of the transaction will be realized or, if realized, the timing of its realization. It is possible that the
integration process could take longer than anticipated, and could result in the loss of employees, the disruption of
each company’s ongoing businesses, processes and systems, or inconsistencies in standards, controls, procedures,
practices, policies and compensation arrangements, any of which could adversely affect our ability to achieve the
anticipated benefits of the Celesio acquisition and which could have a material adverse impact on our financial
position, results of operations, liquidity and cash flows.
Any significant diversion of management’s attention away from the ongoing businesses, and any difficulties
encountered in the acquisition, transition and integration process, could adversely affect our financial results.
Moreover, the failure to achieve the anticipated benefits of the Celesio acquisition could result in increased costs
or decreases in the amount of expected revenues, and could adversely affect our future business, financial
position and operating results. Events outside of our control, including the market price of Celesio shares that we
did not acquire in the acquisition, changes in regulations and laws, as well as economic trends, could also
adversely affect our ability to realize the expected benefits from our acquisition of Celesio.
Our business and results of operations could be impacted if we fail to manage and complete divestitures.
We regularly evaluate our portfolio in order to determine whether an asset or business may no longer help
us meet our objectives. For example, during the fourth quarter of 2015, we committed to a plan to sell our
Brazilian pharmaceutical distribution business and a small business from our Distribution Solutions segment, as
well as a small business from our Technology Solutions segment. When we decide to sell assets or a business, we
may encounter difficulty in finding buyers or alternative exit strategies on acceptable terms in a timely manner,
which could delay the achievement of our strategic objectives. We may also experience greater dissynergies than
expected, and the impact of the divestiture on our revenue growth may be larger than projected. After reaching an
agreement with a buyer, we are subject to satisfaction of pre-closing conditions as well as to necessary regulatory
and governmental approvals, which, if not satisfied or obtained, may prevent us from completing the sale.
Dispositions may also involve continued financial involvement in the divested business, such as through
continuing equity ownership, guarantees, indemnities or other financial obligations. Under these arrangements,
performance by the divested businesses or other conditions outside of our control could have a material adverse
impact on our results of operations.
We are subject to legal and regulatory proceedings that could have a material adverse impact on our financial
position and results of operations.
From time-to-time and in the ordinary course of our business, we and certain of our subsidiaries may
become involved in various legal and regulatory proceedings involving false claims, healthcare fraud and abuse,
antitrust, commercial, employment, environmental, intellectual property, licensing, tort and other various claims.
All such legal proceedings are inherently unpredictable, and the outcome can result in excessive verdicts and/or
injunctive relief that may affect how we operate our business or we may enter into settlements of claims for
monetary payments. In some cases, substantial non-economic remedies or punitive damages may be sought. For
some complaints filed against the Company, we are currently unable to estimate the amount of possible losses
that might be incurred should these legal proceedings be resolved against the Company.
20