PharMerica Shares Fall After News Of Kindred Deal

PharMerica Corp. shares sank Wednesday, a day after the company announced an amended pharmacy provider agreement with Kindred Healthcare Inc. that leads to lower revenue.
PharMerica said the agreement runs through June 30, salamander tattoo 2011, and is expected to decrease 2008 revenue by up to $3 million, but it will not change the company's 2008 guidance.
The company said in August it expects 2008 earnings per share to range between 74 cents and 83 cents on revenue of between $1.94 billion and tattoo side effects $1.96 billion.
Analysts polled by Thomson Reuters expect, bluetrek tattoo on average, 2008 earnings per share of 90 cents on $1.96 billion in revenue.
PharMerica Chief Executive Gregory S. Weishar said the contract establishes a 'firm foundation' for serving Kindred.
Kindred Healthcare Inc. spun off PharMerica in 2007.
The new contract led to larger-than-expected pricing concessions, according to a note from Leerink Swann - Co. analyst Jason Gurda. He also noted that PharMerica faces another large contract renewal next March,recent acquisitions 'may be taking longer than expected to complete.'
Gurda lowered his fourth-quarter earnings per share estimate to 20 cents from 24 cents.
Analysts on average expect 24 cents on $492.4 million in revenue.
PharMerica shares fell 9.4 percent, or $1.58to $15.21 Wednesday.


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