McKesson 2015 Annual Report Download - page 9

McKESSON CORPORATION
Distribution Solutions Segment
McKesson Distribution Solutions consists of the following businesses: North America pharmaceutical
distribution and services, International pharmaceutical distribution and services and Medical Surgical distribution
and services.
North America pharmaceutical distribution and services
Our North America pharmaceutical distribution and services business is comprised of the following
business units: U.S. Pharmaceutical Distribution, McKesson Specialty Health, McKesson Canada, and
McKesson Pharmacy Systems and Automation.
U.S. Pharmaceutical Distribution: This business supplies pharmaceuticals and/or other healthcare-related
products to customers throughout the United States in three primary customer channels: (1) retail national
accounts (including national and regional chains, food/drug combinations, mail order pharmacies and mass
merchandisers); (2) independent retail pharmacies; and (3) institutional healthcare providers (including hospitals,
health systems, integrated delivery networks, clinics and alternate site providers). This business also provides
solutions and services to pharmaceutical manufacturers. This business sources materials and products from a
wide-array of different suppliers, including certain generic pharmaceutical drugs produced through a contract-
manufacturing program.
Our U.S. pharmaceutical distribution business operates and serves thousands of customer locations through
a network of 29 distribution centers, as well as a primary redistribution center, a strategic redistribution center
and two repackaging facilities, serving all 50 states and Puerto Rico. We invest in technology and other systems
at all of our distribution centers to enhance safety and reliability and provide the best product availability for our
customers. For example, in most of our distribution centers we use Acumax®Plus, an award-winning technology
that integrates and tracks all internal inventory-related functions such as receiving, put-away and order
fulfillment. Acumax®Plus uses bar code technology, wrist-mounted computer hardware and radio frequency
signals to provide customers with real-time product availability and industry-leading order quality and fulfillment
in excess of 99.9% adjusted accuracy. In addition, we offer Mobile ManagerSM, which integrates portable
handheld technology with Acumax®Plus to give customers complete ordering and inventory control. We also
offer McKesson ConnectSM, an internet-based ordering system that provides item lookup and real-time inventory
availability as well as ordering, purchasing, third-party reconciliation and account management functionality.
Together, these features help ensure customers have the right products at the right time for their facilities and
patients.
To maximize distribution efficiency and effectiveness, we follow the Six Sigma methodology — an
analytical approach that emphasizes setting high-quality objectives, collecting data and analyzing results to a fine
degree in order to improve processes, reduce costs and minimize errors. We continue to implement information
systems to help achieve greater consistency and accuracy both internally and for our customers.
The major customer groups of our U.S. Pharmaceutical Distribution business can be categorized as retail
national accounts, institutional healthcare providers and independent retail pharmacies.
Retail National Accounts — Business solutions that help national account customers increase revenues and
profitability. Solutions include:
• Central FillSM — Prescription refill service that enables pharmacies to more quickly refill prescriptions
remotely, more accurately and at a lower cost, while reducing inventory levels and improving customer
service.
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