Analyst and Investor Day Presentation PDF

Cardinal Health, Inc.
Analyst / Investor Day Meetings

Sally J. Curley
Senior Vice President, Investor Relations
June 2, 2009
© 2009 Cardinal Health, Inc. or one of its subsidiaries. All rights reserved.
Forward-looking information
The following presentations contain forward-looking statements addressing expectations, prospects, estimates and other matters that are
dependent upon future events or developments. These matters are subject to risks and uncertainties that could cause actual results to differ
materially from those projected, anticipated or implied. The most significant of these uncertainties are described in Cardinal Health’s Form 10-K,
Form 10-Q and Form 8-K reports and CareFusion’s Form 10 registration statement (including all amendments to those reports and registration
statement) and exhibits to those reports and registration statement, and include (but are not limited to) the following: uncertainties related to the
deferral in hospital capital spending affecting Cardinal Health’s Clinical and Medical Products segment and difficulties in forecasting the exact
duration and potential long-term changes in hospital spending patterns; uncertainties regarding the planned spinoff of CareFusion as a new
standalone entity, including the timing and terms of any such spinoff and whether such spinoff will be completed as it is subject to a number of
conditions, and uncertainties regarding the impact of the planned spinoff on Cardinal Health, CareFusion and the potential market for their
respective securities; competitive pressures in Cardinal Health’s various lines of business; the loss of one or more key customer or supplier
relationships or changes to the terms of those relationships; uncertainties relating to timing of generic and branded pharmaceutical introductions
and the frequency or rate of branded pharmaceutical price appreciation or generic pharmaceutical price deflation; changes in the distribution
patterns or reimbursement rates for health care products and/or services; the results, consequences, effects or timing of any inquiry or
investigation by any regulatory authority or any legal or administrative proceedings; future actions of regulatory bodies or government authorities
relating to Cardinal Health’s manufacturing or sale of products and other costs or claims that could arise from its manufacturing, compounding or
repackaging operations or from its other services, including uncertainties and costs relating to complying with the amended consent decree
entered into with the FDA and implementing the corrective action plan submitted to the FDA pursuant to the amended consent decree; the effects,
timing or success of restructuring programs or plans; the costs, difficulties and uncertainties related to the integration of acquired businesses;
uncertainties related to the recent disruptions in the financial markets, including uncertainties related to the availability and/or cost of credit and
the impact of the financial market disruptions on Cardinal Health’s customers and vendors; uncertainties regarding the ultimate features of
government health care reform initiatives and their enactment and implementation; with respect to future dividends, the decision by Cardinal
Health’s board of directors to declare such dividends, which decision will depend on Cardinal Health’s surplus, earnings, cash flows, financial
condition and prospects at the time any such action is considered; and conditions in the pharmaceutical market and general economic and market
conditions. These presentations reflect management’s views as of June 2, 2009. Except to the extent required by applicable law, Cardinal Health
undertakes no obligation to update or revise any forward-looking statement. In addition, these presentations include non-GAAP financial
measures. Definitions and reconciling information will accompany these presentations and will also be available on the investor relations page of
Cardinal Health’s website at www.cardinalhealth.com. A transcript of the webcast will be available on the investor relations page at
www.cardinalhealth.com.
Welcome
R. Kerry Clark
Chairman and CEO
June 2, 2009
Launching two exciting businesses
Timeline target: Summer 2009
Spinoff rationale
• New Cardinal Health and CareFusion are very
different businesses
- Products
- Channels
- Geographic footprint
• Sharper strategic focus
• CareFusion can stand on its own
• Should deliver maximum value to our customers and
shareholders over time
Conditions and governance
• Contingent upon
– SEC declaring the Form 10 effective
– IRS ruling on tax-free nature of transaction
– Obtaining investment-grade credit ratings
– Completion of necessary financing
• Governance
– New Boards of Directors in place at spinoff
Financial reporting
• As of July 1, will begin functioning as separate entities in
anticipation of spinoff completion
• Each entity’s reported results reflecting future company
structure down to operating earnings, rolled up for total
Cardinal Health picture
Sector reporting
– New Cardinal Health
• Pharmaceutical
• Medical
– CareFusion Corporation
• Critical Care
• Medical Technologies and Services
Introductions
George Barrett
Current: CEO, HSCS, Cardinal Health, Inc.
Post-spinoff: Chairman and CEO, New Cardinal Health
Dave Schlotterbeck
Current: CEO, CMP, Cardinal Health, Inc.
Post-spinoff: Chairman and CEO, CareFusion Corporation
Jeff Henderson
Chief Financial Officer, Cardinal Health, Inc.
Post-spinoff: Chief Financial Officer, New Cardinal Health
Full day agenda
All times are eastern
8:00 a.m. Welcome and agenda

Sally Curley, Kerry Clark
8:15 a.m. Spinoff financial details

Jeff Henderson
8:30 a.m. New Cardinal Health

George Barrett, Jeff Henderson, Mike Kaufmann, Mike Lynch
12:00 p.m. Lunch and healthcare reform update

Connie Woodburn
1:15 p.m. CareFusion Corporation

Dave Schlotterbeck, Dwight Winstead, Ed Borkowski
4:30 p.m. CareFusion product demonstrations with management
5:30 p.m. Adjourn
Spinoff overview
Jeff Henderson
Chief Financial Officer
Cardinal Health
June 2, 2009
Spinoff
• Capital structure
• Transaction overview
• CareFusion and New Cardinal Health financial crosswalks
• Spinoff costs and negative synergies
• Go-forward reporting
Capital structure
Cardinal Health
Cash: ~$1.7B
Debt: ~$3.7B
A/R Facility: $850M
Credit Revolver: $1.5B
Rating: BBB+/Baa2; A2/P2
New Cardinal Health CareFusion

Cash: ~$1B Cash: ~$650M
Debt: ~$2.1B Debt: ~$1.4B
A/R Facility: $950M
Credit Revolver: $1.5B Credit Revolver: $500M
CFN Equity Stake: <20%
Expected Rating: Investment grade Expected Rating: Investment grade
Transaction overview1
6: CAH disposes of its less than 2: CFN declares and pays
20% stake in CFN within 5 years $1.4B distribution to CAH
Equity 6 Cardinal 2 CareFusion

Markets Health
3 5
3: CAH uses proceeds of 4: CFN issues public 5: CFN uses 1: CFN borrows $1.4B
CFN $1.4B distribution to debt post-spin to repay proceeds from against bridge loan to
tender for and retire debt bridge loan public debt to repay pay distribution to CAH
bridge loan
4 1
Cardinal CareFusion Bridge Loan

Health Bondholders Banks
Bondholders
1Overview assumes that bridge is drawn down to fund distribution at spin-off
Crosswalk
CareFusion Corporation (CFN)1
Discontinued
Separation Operations Financing
FY09 YTD Historical Adjustments Adjustments Adjustments Pro Forma
Revenue ($M) 3,410 69 (667) 2,812
Gross margin ($M) 1,507 8 (165) 1,350
SG&A ($M) 871 8 (71) 809
Operating earnings 460 (0.4) (89) 370

($M)
Interest expense 83 (15) 39 107
and other, net ($M)
Royalty (income) (194) 194 -

and other, net
received from
parent ($M)
Diluted EPS $0.49
1See CareFusion Appendix for CareFusion historical results and pro forma financial information for the
nine months ended March 31, 2009.
Crosswalk
New Cardinal Health (nCAH)
As Discontinued Special Impairments
FY09 YTD reported operations items and other Pro Forma1
Revenue ($M) 74,385 (2,743) 71,642
Gross margin ($M) 4,183 (1,357) 2,826
SG&A ($M) 2,584 (867) 1,717

Operating 1,461 (434) 71 11 1,1082
earnings ($M)
Diluted EPS from $2.44 $(0.83) $0.14 $(0.05) $1.702

continuing
operations
1Pro forma results reflect the estimated impact of the CareFusion as Discontinued Operations. See
Cardinal Health Appendix for further explanation of the pro forma presentation of certain measures
included herein.
2 Non-GAAP measure. © 2009 Cardinal Health, Inc. or one of its subsidiaries. All rights reserved.
Estimated one-time spinoff cost details
Through
($M) spin date Post-spin
Pre-Tax cash expenses
CAH $109 $47
CFN $60 $53
Pre-tax non-cash charges
CAH $33 $6
CFN – $1
Tax charges $152 –
Estimated negative synergies
Driven by:
• Functional duplication
• De-leveraging shared services
• Additional depreciation
Operating expense1
($M) FY10 FY11 FY12
CFN 30 31 32
nCAH – 17 29
1Incremental cost to FY09 pro forma
Go-forward reporting (FY10 pre-spin)
Consolidated CAH
(P&L, balance sheet, and cash flow)
Sector nCAH CFN

(Operating earnings)
Pharma Critical Care

Segment
(Segment profit)
Medical
Medical
Technologies
Summary
• Spin transaction is on track
• Target completion: Summer 2009
• We expect to be ready to go once transaction
conditions are met
• On July 1, will begin to function as separate
companies in anticipation of spinoff completion
Strategic foundations for
the New Cardinal Health
George Barrett
Post-spinoff: Chairman and CEO
June 2, 2009
New Cardinal Health agenda
8:30 a.m. New Cardinal Health
George Barrett, Post-spinoff: Chairman and CEO
9:05 a.m. Financial overview
Jeff Henderson, Chief Financial Officer
9:30 a.m. Break
9:45 a.m. Pharmaceutical Segment
Mike Kaufmann, Chief Executive Officer, Pharmaceutical Segment
10:25 a.m. Medical Segment
Mike Lynch, Chief Executive Officer, Medical Segment
11:00 a.m. Q&A
George Barrett Tom Kapfer, President, Medical Products & Services
Mike Kaufmann John Rademacher, President, Nuclear & Pharmacy Services
Mike Lynch Frank Segrave, President, Generics
Jeff Henderson
11:45 a.m. Break
12:00 p.m. Lunch and healthcare reform update
Connie Woodburn, SVP, Government Relations
Strategic foundations
• New Cardinal Health
• Critical role in healthcare
• Three pillar strategy for the future
• What to expect going forward
Why new Cardinal Health?
Well positioned to play central role across entire
Positioning
healthcare spectrum, especially with demographic trends
Balanced Balanced business model focused on delivering

model healthcare products and services
Cost-effective Well positioned to deliver healthcare solutions in most

solutions cost-effective manner while maintaining product integrity
Financial Strong balance sheet and cash flows, making necessary

strength investments to strengthen future position
Experienced team with diverse healthcare backgrounds

Leadership
leading one of largest healthcare companies in N. America
Profile of a leader
Revenue* >$94B
Operating earnings* ~$1.5B
Employees ~30K
Countries with direct operations 11
Customers >50K
*Pro forma Cardinal Health non-GAAP revenue and operating earnings, trailing 12 months ended March 31, 2009.
See Cardinal Health appendix for more information regarding Cardinal Health pro forma financial information.
What’s new about Cardinal Health?
• Experienced management team with
renewed focus on the core
• Reinvigorated culture
• Capital deployment strategy
• Streamlined portfolio management
New Cardinal Health – Who we are
George Barrett Chairman and CEO

Jeff Henderson Chief Financial Officer
Mike Kaufmann CEO, Pharmaceutical Segment
Mike Lynch CEO, Medical Segment
Shelley Bird EVP, Public Affairs
Craig Morford Chief Legal and Compliance Officer
Mark Rosenbaum Chief Customer Officer
Carole Watkins Chief Human Resource Officer
Our mission
We make healthcare more cost-effective
so our customers can focus on their patients
Our Customers Patients
• Customers are facing enormous pressures to reduce costs and improve performance
• We reduce the costs of care through our sourcing, supply chain efficiencies, reduction
of errors and safety events, and supplier and channel relationships
Healthcare costs are rising
at an alarming rate
National health expenditures per capita, 1990-2016
(Millions)
$14,000
$12,782 • Up to 66 million Americans could be
(2016)
$12,000 uninsured by 2019 unless healthcare
reform is enacted1
$10,000
$7,498 • Businesses could see their healthcare
(2007)
$8,000 costs double within 10 years1
$6,000
• 64.4 million, or 1 in 4 non-elderly
$2,813
Americans, are in families that will spend
$4,000 (1990) >10 percent of pre-tax income on
Per Capita
healthcare this year2
$2,000 Projected Per Capita
• 2007 figures for those without health
$0 insurance were 45.7M or 15.3%2
90
92
94
96
98
00
02
04
06
08
10
12
14
16
19
19
19
19
19
20
20
20
20
20
20
20
20
20
Note: Figures from 1990 through 2005 represent historical data; data from 2006-2016 are projected.
Source: Centers for Medicare and Medicaid Services, Office of the Actuary, National Health Statistics Group, at
http://www.cms.hhs.gov/NationalHealthExpendData/ (Historical data from NHE summary including share of GDP, CY 1960-2005,
file nhegdp05.zip; Projected data from NHE Projections 2006-2016, Forecast summary and selected tables, file proj2006.pdf).
1May 2009 report by researchers at the Urban Institute for The Robert Wood Johnson Foundation
2April 2009 report from Families USA and U.S. Census Bureau
Positioned on the right side
of healthcare evolution
Health Reform Priorities Role of New Cardinal Health
• Slow growth rate of costs • Efficient, low cost partner

Rising costs • Comparative effectiveness • Solutions for increased
research customer efficiency
Increasing number • Expand coverage through • Continued/increased demand

of uninsured public / private hybrid with for products and services
and underinsured shared responsibility
Fragmented • Continuum of care • Necessitates broad

system infrastructure and health IT footprint and capability to
work across channels
• Pay for performance and • Heightened focus on

Quality issues aligned incentives safety and quality
At the intersection of the
evolving healthcare system
Retail
• Pharmacy
• Mail service
• In-store clinic
Ambulatory
Care
Acute Care • Clinic
• Hospital • Physician office
• Laboratory • Home care provider
• Long-term care
• Surgery center
Critical role in a complex system
• Distribution
• Inventory management
• Logistics support
• Product selection
Retail • Financial transactions
• Risk management
• Patient safety
• Pharmacy management
• Quality and integrity
Acute Care Ambulatory Care
Delivering value to major stakeholders
Role of New Cardinal Health Impact
• Improve efficiency, eliminate • Improved economics
Customers waste, enable scale and
manage risk
• Most efficient link to end- • Cost-effective solutions

Suppliers users, manage risk, smooth that deliver economic
volatility, drive share value and secure volume
• Drive usage of cost • Improved economics

Payors effective solutions, ensure and outcomes
safety / integrity
Consumers
Two strong segments
Segment Key Activities
Pharmaceutical
• Pharmaceutical distribution
~2/3 of
• Manufacturer and
segment profit1
specialty services
• Nuclear and pharmacy services
Medical
• Medical product distribution
~1/3 of
• Lab product distribution segment profit1
• Infection prevention products
Balanced portfolio of products and services playing a critical role

in the healthcare system
1 Numbers are unaudited estimates of FY10 segment profit contribution.
Strategic direction for
New Cardinal Health
Strengthen Expand Build
the core into adjacencies new growth platforms
• Deliver exceptional • Offer new products Explore:
customer service
• Expand service offerings • Related healthcare
• Strengthen our competitive segments
• Broaden distribution
advantage in supply chain
channels • Strategic M&A and
and sourcing
partnerships
• Focus our business
• Opportunities outside
portfolio and build scale
U.S. and Canada
• Create a lean, disciplined and agile organization

• Manage performance and measure progress
• Improve systems and related processes
• Deepen knowledge of stakeholder economics
• Build talent and capability
Strengthen the core
Progress in the past year
9 • Delivering FY09 HSCS financial goals

9 • Refocus on customer retention and loyalty
• Stabilize pharmaceutical segment
9– Solidify management team
9– Controlled drug licenses restored
9– Strengthen relationship with retail independents
9 • Elevate focus on and commitment to Medical

9 • Nuclear well positioned following generic event
Strengthen the core
Continued emphasis on the core
• Significant progress ongoing
– Simplify how we do business
– Invest in productivity (IT and OpEx)
– Medical transformation
• Major initiatives underway

– Inventory management / new stocking strategies
– Further enhance Medical sourcing model
– Further enhance generic model
Strengthen the core
Portfolio management
• Reposition Medicine Shoppe International
• Divest Martindale (UK business)
• Divest SpecialtyScripts pharmacy, but committed

to specialty distribution
Expand into adjacencies
Maximize our core competencies
• Accelerate private label growth in Medical
• Innovations in operating room
• Expand Positron Emission Tomography (PET)
• Scale specialty distribution
• Expansion outside of acute care setting
Build new growth platforms
Future growth opportunities
Explore:
• Clinically-oriented products and services
• Information-enabled strategies
• Targeted international expansion
Near-term considerations
• Completing the transition in FY10
• Short-term market factors create headwinds
– Generic launch cycles
– Impact of economy on procedure-based channels
• Important contract renewal

• DSA timing
• Continued investment to further strengthen the core
– Medical transformation
– Retail independents
– Ambulatory Care
Three-year outlook
Regaining momentum in FY11
• Pharmaceutical will regain positive growth trajectory
• Medical will grow faster, creating an even more

balanced business model
• Non-GAAP EPS past FY10, growing at high single digit rate
Close expense control with a focus on margins and balance sheet
Positive momentum
• Attractive industry: sustained demand growth
• Focused on critical issue for the industry: cost-effectiveness
• Stabilized organization and investing in its future
• Increasingly balanced business model
• Attractive capital deployment
Solid cash-generating businesses with trends in our favor
Positioning




Leadership
New Cardinal Health:
Disciplined financial management
Jeff Henderson
Cardinal Health
June 2, 2009
Agenda
• Driving financial discipline
• Three-year financial outlook
• Focus on shareholder return
Success at Cardinal Health requires
exceptional financial discipline
Key focus area Financial management implications
Simplifying the portfolio • Ongoing, disciplined portfolio reviews

• Resource focus
Strengthen core • Account profitability management

• Active compliance monitoring
• Selective capital investment to drive differentiation
• Focus on key performance metrics
Shareholder return • Maximizing cash flow yield

• Exercising capital deployment discipline
• Increasing dividend pay-out
Reshaping and simplifying portfolio
Pre-Spin Post-Spin
(2005-2009) (2010)
• Pharma Distribution • Gloves/Convertors/ Fluid Pharmaceutical

• Medical Supply
Management Segment
• Medical Specialties • Pharma Distribution
• UK Pharma Dist.
• Pharmaceutical Contract
• Pharmacy Services • Manufacturer and Specialty
Manufacturing
• Nuclear Pharmacy
Services
• Industrial Apparel
• Medicine Shoppe • Pharmacy Services
• Contract Printing and FOCUS
• Martindale Packaging • Nuclear Pharmacy
• Kitting (Presource™) • Tecomet • Medicine Shoppe
• Contract Sales and • Medsystems
Marketing Medical Segment
• Dispensing
• Pharmacy Staffing
• Infusion • Medical Supply
• Specialty Pharmacy • Gloves/Convertors/
• Respiratory
Fluid Management
• Manufacturer and
Specialty Services • Kitting (Presource™)
Simplified reporting
CTS PTS
Pharmaceutical
Segment
MPS Medical
PDPS Segment
FY05 Segment Profit Contribution FY10(E) Pro Forma Segment

as Originally Reported1 Profit Contribution2
CTS – Clinical Technologies and Services; MPS – Medical Products and Services; PTS – Pharmaceutical Technologies and
f
Services; PDPS – Pharmaceutical Distribution and Provider Services

2Pro forma segment profit contribution reflects the estimated impact of CareFusion as Discontinued Operations in the period
presented. See Cardinal Health Appendix for©further explanation

2009 Cardinal Health,ofInc.
theorpro
oneforma presentation
of its subsidiaries. Allof certain
rights measures included herein.
reserved.
Strengthen the core
Key financial metrics
Segment profit
margin
Operating Total
Net working
cash shareholder
capital days
flow return
Return on
tangible capital
Strengthen the core
Driving efficient capital management
Net Working Capital Days1

15
FY09E FY10E FY11E FY12E
1Net working capital days reflects the estimated impact of CareFusion as Discontinued Operations in the
period presented. See Cardinal Health Appendix for further explanation of the pro forma presentation of
certain measures included herein.
Strengthen the core
Strong operating cash flow generation
Operating Cash Flow1
$1.3B
0
1Operating cash flow from continuing operations reflects the estimated impact of CareFusion as
Discontinued Operations in the period presented. See Cardinal Health Appendix for further explanation
of the pro forma presentation of certain measures included herein.
Agenda
Entering FY10 with strong balance sheet
• Total debt (after post-spin debt retirement): ~$2.1B
• Cash position: ~$1.0B
• Accounts receivable facility: $950M
• Bank credit revolver: $1.5B (thru Jan FY12)
• <20% CFN equity stake
• Committed to maintaining investment grade ratings
FY10 headwinds expected to
subside in FY11
Est. FY11
Market factors FY10
and FY12
Generic launches
Pricing/customer renewals
Medical cost of goods
Strategic positioning decisions
DSA transition timing
Portfolio repositioning
Sourcing models
Transformational investments
Medical Supply Chain
Ambulatory care
Customer ordering systems
Cost control & performance
improvement initiatives
Negative synergies
Organic investment for the future
Capital Expenditures1
$300M
0
I/T Other
1Estimated capital expenditures for Cardinal Health excluding CareFusion.
FY10 outlook
• A year of transition and investment
• Continued strong cash flow generation
• Investing in capex and increasing dividend
• Growth in M segment despite increased investment
• Dealing with headwinds in P while preparing for the future
Earnings per share1 growth returns in FY11
$2.20-$2.25(E)
1Pro forma non-GAAP diluted earnings per share from continuing operations reflects the estimated impact of
CareFusion as Discontinued Operations in the period presented. See Cardinal Health Appendix for further
explanation of the pro forma presentation of certain measures included herein.
Agenda
Focus on shareholder return
Margin Working capital

expansion management
reinv
e st Strong OCF and investment grade credit
Return capital to shareholders
Strong track record of
disciplined capital deployment
Source of cash Deployment

11%
Capital
expenditures
25% Acqusitions
4% Dividends
$11.6B total
Share repurchases
60%
$11.5B total
OCF
Divestitures
Increased Leverage
FY05-FY08
History of increasing dividend returns,
supplemented by share repurchases
Dividends Share repurchases*

$M $M
250
4,000
200 3,500
3,000
150 2,500
2,000
100
1,500
50 1,000
500
0 0
FY04 FY05 FY06 FY07 FY08
00
01
02
03
04
05
06
07
08
E
09
FY
FY
FY
FY
FY
FY
FY
FY
FY
FY
*Share repurchase program suspended in FY09 due to spinoff
Capital deployment will differentiate
New Cardinal Health
• 25-30% of OCF for organic growth and strengthening the
core through high-impact capital investments
• Tuck-in M&A activity
• Opportunistic share buybacks, primarily focused on
offsetting equity program issuances in near-term
Meaningful and increasing

dividend pay-out
Significantly increasing dividend payout
31%
Historical 20% target
17%
13%
10%
5% 7%
4%
FY04 FY05 FY06 FY07 FY08 FY09 FY09 pro

YTD forma1
1Pro forma payout ratio reflects the anticipated dividend per share post spinoff of $0.175 cents per share
per quarter divided by the mid-point of the FY09 pro forma non-GAAP earnings per share of $2.20-
$2.25.
In summary
We have a clear financial focus
• Superior execution against stated goals and
delivering on key metrics
• Relentless focus on cost and capital efficiency
• Strengthening our core capabilities and building
stronger foundation for future growth
• Strong external focus on maximizing shareholder
return through differentiated capital deployment
Pharmaceutical Segment
Mike Kaufmann
Chief Executive Officer
June 2, 2009
Agenda
• Overall segment view
• Business today and profit drivers

– Nuclear and Pharmacy Services
– Manufacturer and Specialty Services
– Pharmaceutical Distribution
• Outlook and summary
Pharmaceutical Segment today
Revenue1 >$85B
Segment profit1 >$1B
SKUs >50k
Distribution centers 25
Nuclear pharmacies ~160
1 Pro forma revenue and segment profit, trailing 12 months ended March 31, 2009. See Cardinal
Health appendix for more information regarding Cardinal Health pro forma financial information.
At the intersection of the
evolving healthcare system
Retail
• Pharmaceutical
Distribution
Ambulatory
Acute Care Care
• Pharmaceutical • Pharmaceutical
Distribution Distribution
• Nuclear and • Nuclear and
Pharmacy Services Pharmacy Services
• Manufacturer and • Manufacturer and
Specialty Services Specialty Services
Nuclear and Manufacturer and Pharmaceutical

Pharmacy Services Specialty Services Distribution

Nuclear and Pharmacy Services
Nuclear Pharmacy Services – Industry leader
Our position:
• Leader in industry and growing: can reach >90% of U.S. hospitals in <3 hours
• Only national network with both low-energy and high-energy dispensing
• Only national network with both branded cardiac imaging agents
(Cardiolite and Myoview) and lower-cost alternative
• High customer loyalty scores show highly differentiated service
• Leader in safety: patented delivery systems and education programs
Profit drivers:
• Successfully release lower-cost generic this summer
• Optimize customer operations with new
management software
• Capture increased use of diagnostic imaging studies
Positron Emission Tomography (PET) – Growing
Our position:
• A leading U.S. player in number of cyclotrons and doses, and growing
• Focused on cGMP Manufacturing of agents used in diagnosis/treatment
• Technical and chemistry expertise to support clinical trials
of proprietary agents
• Partner in research with universities and pharmaceutical companies
Profit drivers:
• Acquire tuck-in to build national footprint
• Deepen collaboration with key universities
• Become integral part of clinical trial design for biopharma
Pharmacy Solutions – Re-positioning
Our position:
• Leader in pharmacy management, outsourcing services and
formulary management
• Fast growing Rxe-sourceSM augments staff and provides after-hour coverage
• Expertise in data analytics to improve pharmacy efficiencies and processes
Profit drivers:
• Re-energize and re-position the business
• Expand service footprint
• Implement formulary management in pharmacies

Manufacturer and Specialty Services –
Bringing focus
Our position:
• Key player in third-party logistics, representing over 60 supplier partners
• Significant presence in plasma/specialty distribution
• Recognized expertise in regulatory consulting on new drugs
• Payor authorization/qualification consulting
Profit drivers:
• Create a differentiated model
• Drive synergy among the businesses
• Build-out capabilities

Pharmaceutical Distribution
Pharmaceutical distribution – Our position
Distributor to national retail chains Leading
Distributor to acute-care facilities Leading
Footprint in Puerto Rico Leading
Generic telesales Increasing
Logistics network Differentiated
Critical role in the healthcare system
Supply Partners Customers
Brand HBA/ Retail Mail

Pharma OTC Pharmacy Service
Generic Private Alternate

Hospital
Pharma Label Care
Supply Partners Customers

Pharmaceutical
Distribution
Hospital
Pharma Label Care
Generating value up and down the supply chain
Value delivered to Retail
• Reduced generic acquisition costs
– Demand aggregation
– Simple program with aligned incentives
• Reduced inventories
– Best-in-class software and process (Cardinal Inventory Manager)
– Daily delivery with high service levels
• Reduced back-office costs / administration

– Best-in-class third party programs
– Front-end merchandising
Partner with key Retail customers
Two Retail Independent brands – Deliver value
• Improve payor management for
better financial performance
Value: ~$45K profit/average store1
• Streamline operations for

improved performance
3,200 stores Value: ~$27K profit/average store1
• Create alternative revenue

streams for better margins
• Increase traffic and attract new

778 franchisees and loyal customers
1Cardinal Health market research. Results are per year estimates.
Value delivered to health systems
• Reduced generic acquisition costs
– Carve-out portfolios
– Back-up portfolios
• Reduced acquisition costs

– Contract compliance reporting
– Sentry 340B software
• Reduced labor costs

– Packaging options
– Delivery to the floor - CardinalASSISTSM
Supply partners Customers

Pharmaceutical
Distribution
Hospital
Pharma Label Care
Generating value up and down the supply chain
Value delivered to supplier partners
• Transparency – Provide sales and inventory data
• Integrity – Buy only from manufacturer
• High fill rates – Scripts not delayed or unfilled
• Volume – Generic formularies drive volume
• Financial stability – Insulation from credit exposure
• Simplicity – Manage charge backs/credit, logistics
A strong business model
Breadth Important player in all classes of trade
Differentiation Equal or superior offers
Integration Borschow, ParMed, Dohmen done well
Execution Positive in all areas
Experience >100 years combined industry experience
Knowledge Strong customer and supplier relationships
Industry dynamics play to our strengths
• Growth
– Wholesaler growth has surpassed industry projections
– Aligned with key customers
– Healthcare reform, demographics and consumerism should
drive continued volume and generic utilization
• Customer consolidation
– Aligned with acquirers
• Manufacturer consolidation
– Little to no impact on our cost to serve
• Regulations
– Cold chain, anti-diversion and pedigree require
continued focus and investment
Key profit drivers
1 Improve the customer experience
2 Grow generics
3 Increase sales force effectiveness
1. Improve the customer experience
• Deliver a consistent experience
• Develop technology that simplifies their lives
• Create value-added programs
• Know what each customer values, and deliver it
Customer Loyalty
Q3FY08 Q4FY08 Q1FY09 Q2FY09 Q3FY09 Q4FY09
Result: Higher customer retention, above-market sales growth
2. Grow generics
Goals for FY10
• Improve our sourcing model
and costing • Increase generic
margin rates by
• Offer clear value proposition
>200 basis points
• Deliver best-in-class
service levels • Increase retail
• Require and enforce independent
contract compliance generic penetration
by >10%
Result: Expanded margins and increased profitability
3. Increase sales force effectiveness
• Know the customer
• Know the competitive
environment
• Sell value
• Reward the right behaviors
• Measure performance
Result: Expanded margins, increased direct-store-door

growth and increased profitability
Agenda
• Overall segment view
• Business today and profit drivers

– Nuclear and Pharmacy Services
– Manufacturer and Specialty Services
– Pharmaceutical Distribution
Pharmaceutical Segment key metrics
Customer loyalty scores
Unadjusted service levels
Penetration (% generics)
Non-bulk revenue growth
Segment profit margin
Inventory days
In summary
We have value, focus and a plan to grow
• Cost-effective and efficient: Wholesalers are the most cost-
effective and efficient way for suppliers and customers to interact.
• Focused on the customer: Offers are customized to each

customer’s unique needs. Programs and services are best-in-class,
easy to understand and execute, and valued by customers.
• Stabilized and growing: While Pharmaceutical Distribution has

challenges and faces a tough FY10, it is executing well against
goals and investing in key initiatives to deliver long-term value.
Medical Segment
Michael A. Lynch
CEO, Medical Segment
June 2, 2009
Agenda
• Business today
• Industry dynamics
• Profit drivers
Medical Segment today
Revenue1 >$8B
Segment profit1 >$400M
SKUs ~300k
Distribution centers 49
Manufacturing sites 13
1Proforma revenue and segment profit, trailing 12 months ended March 31, 2009. See Cardinal Health
appendix for more information regarding Cardinal Health pro forma financial information.
Channel and product-focused businesses
Medical Products
Clinical / Procedural Canada
and Services
Businesses
• Hospital • Kitting (Presource™) • Hospital

Channel
• Lab (Source Medical)

• Ambulatory • Ambulatory
Businesses
Products
Infection Prevention Products
Key strengths
1. Scale in each of our channels: hospital, lab, ambulatory, kitting
2. Depth and breadth of capabilities: distribution,

sourcing, manufacturing
3. Differentiated portfolio of self-manufactured products
4. Dedicated sales capabilities for different hospital callpoints:

C-suite, materials management, OR, nursing, pharmacy
1. Unmatched channel breadth
Hospital Canada Clinical Ambulatory Kitting
(U.S.) Lab Surg. Phys.
Ctr. Office
9 9 9 9 9 9
9 9
9 9 9 9
9
9
2. Unmatched depth of capabilities
Hospital (U.S.) Canada Clinical Lab Ambulatory Kitting
Distribution and Supply Chain Services
Self-Manufactured Products
Branded Products
Sourced Products
3. Differentiated product portfolio
Esteem®
#1 polyisoprene surgical glove
Tiburon®
Industry-leading surgical drape
Medi-Vac Guardian canister

#1 OR suction canister
4. Dedicated sales capabilities
Hospital Customers Customer Account Team

C-Suite Strategic Accounts • Multiple customers/
departments within
Operating Room OR (Inf. Prev.) Products
each hospital
Nursing Nursing Products
• Served by one
Pharmacy Pharma Distribution
dedicated account team
Radiology Nuclear Pharmacy
• With specialist support
Lab Lab Products & tailored to each
Distribution
Central Sterile customer/department
Kitting (OR Products)
Materials Management
Med/Surg Distribution
Leadership positions we have today
present great opportunities for the future
• Leading distributor of medical products in North America
• Leading distributor of supplies to clinical laboratories

and surgery centers
• Leader in medical procedure kits and surgical packs
• Leading positions with self-manufactured products

(domestic and international)
Agenda
• Business today
• Profit drivers
Industry environment plays to our strengths
• Volume will increase as coverage expands

• Cost to serve must decrease as current growth rate is
not sustainable
• Procedures are shifting to ambulatory care settings
• Growing importance of diagnostics as a critical aspect
of providing quality, cost-effective care
• Comparative effectiveness will require proof that
products drive outcomes superior to existing protocols
Well positioned to meet customer needs
• Scale across channels that supports the development

of a low-cost product portfolio
• Expertise that helps our customers make their supply
chain more efficient and effective
• Shared, flexible operating platform that allows us to
serve our customers cost effectively across multiple
care settings
• Customer insight and manufacturing expertise to
develop clinically differentiated products
Agenda
• Business today
• Profit drivers
Five key profit drivers
1. Invest in a business transformation that will deliver a
best-in-class customer and supplier experience
2. Improve sourcing capabilities to utilize our scale
3. Grow in laboratory/ambulatory care channels
4. Execute new kitting business model
5. Expand our product portfolio
– Innovation in OR products
– Private label
1. Customer and supplier experience
Medical Segment Customer Loyalty
Q3FY08 Q4FY08 Q1FY09 Q2FY09 Q3FY09 Q4FY09
2. Sourcing capabilities
• Beginning to source across channels

– Improved economics
– Standardized terms and conditions
• Drive more purchasing volume through sourcing

capabilities in Asia
• We will more aggressively manage product categories
across segment
– Reducing complexity and cost for our customers
– Creating deeper, more meaningful supplier relationships
3. Growth in Ambulatory and Lab
Industry
Growth Focus
Lab
Clinical 6-7% Continue to serve well
Independent 6-8% Priority for expansion
Life Science 4-6% Future opportunity
Ambulatory
Surgery Center 6-8% Continue to serve well
Physician Office 5-6% Priority for expansion
Home Care 6-7% Future opportunity
Long Term Care 1-3% Future opportunity
4. Execute new kitting business model
• Lean transformation to improve speed in meeting
changes in customer needs
• Driving lower component costs through enhancement of

segment’s sourcing capabilities
• New business models that better differentiate between

customer desire for low-cost, standardized kits and
customized kits
5. Expanding our product portfolio
Innovation in the OR
ORwell
Differentiated fluid collection and
disposal solution
Private Label
Private Label
Expansion
Using our sourcing expertise to offer

customers a compelling alternative to
current offerings
Agenda
• Business today
• Profit drivers
Medical Segment key metrics
Customer loyalty scores

Private label growth
Service levels
Return on tangible capital
Segment profit margin
Why we will win
• Unmatched channel breadth
• Unmatched product depth
• Deep capabilities in sourcing and operational excellence
• Unrivaled, integrated sales capabilities
Positioning




Leadership
Analyst and Investor Meeting
June 2, 2009
NYSE: CFN
© 2009 CareFusion Corporation or one of its subsidiaries. All rights reserved.

Forward Looking Statements
These presentations contain forward-looking statements addressing expectations, prospects, estimates and other matters that are dependent
upon future events or developments. These matters are subject to risks and uncertainties that could cause actual results to differ materially
from those projected, anticipated or implied. The most significant of these uncertainties are described in our Form 10 and Cardinal Health’s
Form 10-K, Form 10-Q and Form 8-K reports (including all amendments to those reports) and exhibits to those reports, and include (but are
not limited to) the following: uncertainties regarding our planned spinoff as a new stand-alone entity, including the timing and terms of any
such spinoff and whether such spinoff will be completed as it is subject to a number of conditions, and uncertainties regarding the impact of
the planned spinoff on us and the potential market for our securities; uncertainties regarding the divestiture of any of our stock retained by
Cardinal Health after the spinoff; difficulties or delays in the development, production, manufacturing and marketing of new or existing
products and services, including difficulties or delays associated with obtaining requisite regulatory approvals or clearances associated with
those activities; changes in laws and regulations or in the interpretation or application of laws or regulations, as well as possible failures to
comply with applicable laws or regulations as a result of possible misinterpretations or misapplications; cost-containment efforts of our
customers, purchasing groups, third-party payers and governmental organizations; the continued financial viability and success of our
customers and suppliers and the potential impact on our customers and suppliers of declining economic conditions, which could impact our
results of operations and financial condition; uncertainties related to the deferral in hospital capital spending and difficulties in forecasting the
exact duration and potential long-term changes in hospital spending patterns; costs associated with protecting our trade secrets and
enforcing our patent, copyright and trademark rights, and successful challenges to the validity of our patents, copyrights or trademarks;
actions of regulatory bodies and other government authorities, including the FDA and foreign counterparts, that could delay, limit or suspend
product development, manufacturing or sales or result in recalls, seizures, consent decrees, injunctions and monetary sanctions; costs or
claims resulting from potential errors or defects in our manufacturing that may injure persons or damage property or operations, including
3
costs from remediation efforts or recalls; the results, consequences, effects or timing of any commercial disputes, patent infringement claims
or other legal proceedings or any government investigations; disruption or damage to or failure of our information systems; interruption in
our ability to manufacture our products or an inability to obtain key components or raw materials or increased costs in such key components
or raw materials; the costs, difficulties and uncertainties related to the integration of acquired businesses, including liabilities relating to the
operations or activities of such businesses prior to their acquisition; uncertainties in our industry due to government healthcare reform;
uncertainties related to the availability of additional financing to us in the future and the terms of such financing; risks associated with
international operations, including fluctuations in currency exchange rates; the effects of our strategies to run our business in a tax-efficient
manner; competitive pressures in the markets in which we operate; the loss of, or default by, one or more key customers or suppliers;
unfavorable changes to the terms of key customer or supplier relationships; and general economic and market conditions. These
presentations reflect management’s views as of June 2, 2009. Except to the extent required by applicable law, we undertake no obligation to
update or revise any forward-looking statement. A transcript of the webcast will be available on the investors page of Cardinal Health’s
website at www.cardinalhealth.com

David L. Schlotterbeck
Chairman and CEO
Key Themes
1 Large, global, growing opportunities
2 Competitive advantage, leadership across all

categories
3 Clear growth drivers

– Innovation
– Align to execute
– Expand margins

Afternoon Agenda
2:00 p.m. Company, strategic overview
- Who we are, why invest Dave Schlotterbeck
- Focus on innovation Chairman, CEO
2:40 p.m. Operations overview

- Why we win, how we grow Dwight Winstead
- Organized to execute Chief Operating Officer
- Expand margins
3:25 p.m. Financial overview

- CFN P&L Ed Borkowski
- Spinoff details Chief Financial Officer
- Capital strategy
Dave Schlotterbeck
3:45 p.m. Q&A
Dwight Winstead
Ed Borkowski
Jim Hinrichs, Controller
4:30 p.m. Product showcase Segment presidents

Why Invest in Us?
experience Led by veteran healthcare team
Among largest med-tech companies with global

scale reach and longstanding customer relationships
Aligned with pressing trends in healthcare,

focus differentiated strategy
portfolio Industry leadership across all categories
Strong pipeline of innovative products

innovation and services

Experience
Seasoned Management Team
Years in Healthcare
Dave Schlotterbeck, Chairman & CEO 20

Dwight Winstead, COO 30
Ed Borkowski, CFO 20
Vivek Jain, President Medical Technologies and Services 15
Tom Leonard, President Dispensing Technologies 10
Carol Zilm, President Critical Care Technologies 20
Proven leadership in sales & marketing, operations,

finance, M&A, R&D/innovation

Scale
As an Independent Company
Revenue $3.77B1
Op earnings $537M1
R&D Spend ~$157M1
Patents/pending ~3,200
Direct operations >20 Countries
Customers 25,000
Employees >15,000
Headquarters San Diego
Ticker NYSE: CFN
1. Pro forma FY08 (Amendment #1 to Form 10, May 14, 2009)

Scale
Targeting a Large Global Opportunity
Acute care Outpatient

hospitals surgery centers
>$15 B
Insurance global Ambulatory
providers opportunity1 clinics
Government
1Estimated worldwide opportunity in 2010: industry sources, CareFusion

Corporation analysis

Focus
Macro Trends Play to Strengths
• Rising healthcare costs,
declining reimbursement and
funding
• Increase in global demand for
Global
healthcare
quality healthcare Play to
focused on
• Shortage of more than 4M ourand
safety
healthcare workers1 strengths
efficiency of
• Healthcare reform will drive care
change, transparency
• Reimbursement tied to
quality: CMS, Hospital
Acquired Conditions (U.S.)
1. The World Health Report 2006, “Working together for health”, pp 11-12.

Focus
Need Has Never Been Greater
Breast cancer Overall healthcare
screening in U.S. (RAND)
Adverse drug events

1,000,000 Hospital-acquired infections
100,000 Airline baggage handling

Defects
10,000
per
million 1,000
Anesthesia-
100 related
fatality rate
10 U.S. industry
Best-in-Class
1
1 2 3 4 5 6
σ levels
Source: C. Buck, GE, 2007

Focus
Addressing Critical Market Needs
Annual serious adverse events in
a typical 300-bed hospital
• Medication errors cost
1,300 1,260 $3.5 billion per year in
U.S.1, $3 billion per year
in top 5 European
countries2.
• More than 7 million
global HAIs annually3,
costing as much as $20
Adverse drug Hospital-acquired billion per year in the
events infections U.S alone4
Sources: Agency for Healthcare Research and Quality, April 2008.
1. Institute of Medicine. Preventing medication errors. Aspen P, Wolcott J, Bootman L, Cronenwell LR, Eds. 2006; Washington
DC: National Academic Press.
2. Creation of a better medication safety culture in Europe: Building up safe medication practices, Expert Group on Safe
Medication Practices (P-SP-PH/SAFE) Council of Europe (2006)
3. WHO, Fast Facts , available at: \http://www.who.int/features/factfiles/patient_safety/en/index.html.
4. McCaughey, Betsy. Unnecessary Deaths: The Human and Financial Costs of Hospital Infections. Committee to Reduce
Infection Deaths. www.hospitalinfection.org -. Accessed via
http://www.vigilairsystems.com/pdfs/RID%20costs%20HAI%20UVGI.pdf, January 5, 2009.
Focus
Our Mission
Deliver clinically proven products and services

that measurably improve the productivity and
safety of healthcare globally

Portfolio
Creating a New Industry Leader
Medication safety and infusion systems Leader
Dispensing systems Leader
Worldwide acute-care respiratory Leader
Hospital-acquired infection (HAI) prevention Leader
Enterprise-wide medication management Leader
Positive patient identification Leader
Handheld surgical instruments Leader

Portfolio
Positive Patient Identification
• Tissue and implant tracking
• Bar-code medication
administration
• Nursing documentation
• Blood transfusion tracking
• Patient lab and specimen
collection
• Infant care: mother / child
association
• Charge capture

Innovation
CareFusion Growth Engine
2010 Revenue from R&D as % of Sales
2007-2009 new product
introductions 6-7%
New
Product
~20% revenue ~ 4%
Today Long-Term Goal

Innovation
Expanding Traditional Markets
Agile information management
Next-generation medication management
Remote device programming

Integration of health records
Safety Data & Analytics

& Clinical Connectivity
Patient Event Advisor
Value EnVe Ventilator
VAP bundle
Core products ~40 new

products
‘09 ‘10 ‘12

Innovation
EnVeTM Ventilator
• Full featured Critical Care Ventilator for
pediatric and adult patients
• 9 ½ lbs compared to products in the same
class at 80 – 90 lbs.
• Well positioned in largest segment in
ventilation
• Patented ActivCore Technology is the basis
for an extremely powerful and compact
designed ventilator
• Wall independence and 4 hour hot swap
battery technology
• Proprietary disposable and reusable circuits,
flow sensor technology for enhanced safety

Innovation
Patient Event Advisor
New tool in the fight against Adverse Drug Events
• Monitors patients for adverse

reactions in near real time
• Warns of inappropriate
medications ordered
• Focuses pharmacist resources
• Provides workflow
documentation
• Reports quality metrics
• Future plans: ADE warnings
through Pyxis MedStation
System

Near-Term Considerations
• FY09 – American Hospital Association reports 80% of

hospitals deferring some portion of capital spend (April
2009)
– spending deferral affecting FY09 – CMP segment profit
down 7-11% from FY08
• FY10 will continue to be affected by capital deferral,

plus stand-up costs
– expect improvement in 2H CY10
• Will issue full guidance ahead of “when-issued” trading

Future Revenue, Earnings Trends
Revenue
• Longer term revenue trend expected to
outpace growth of core markets
• Long-term growth goal: mid-single digits
Earnings
• Post-spin baseline set in FY10
• Operating earnings long-term growth goal: 11% - 15%

Why Invest in Us?
experience Led by veteran healthcare team
Among largest med-tech companies with global

scale reach and longstanding customer relationships
Aligned with pressing trends in healthcare,

focus differentiated strategy
portfolio Industry leadership across all categories
Strong pipeline of innovative products

innovation and services

Dwight Winstead
Chief Operating Officer
Agenda
Reporting segments
• Why we win
• How we grow
Value drivers
• Organized to execute
• Expand margins

Two Segments
with Scale, Leadership
Critical Care Medical Technologies
Technologies and Services
Dispensing Infusion Respiratory Infection Medical

Prevention Specialties
#1 #1 #1 #1 Leading Offerings
FY08 FY08
Revenue: $2.6B1 Revenue: $1.1B1
1
Data is unaudited pro forma information prepared on the
same basis as the pro forma condensed combined financial
statements included in the Amendment No. 1 to Form 10 filed on May 14, 2009.
Positioned in Large
$15 Billion1 Worldwide Opportunity
Critical Care Medical Technologies
Technologies & Services
Dispensing
Medical
Specialties
Infusion $7B $8B
Infection
Prevention
Respiratory
Worldwide opportunity growing 5% annually
1
Estimated worldwide opportunity in 2010: industry sources,
CareFusion Corporation analysis

Critical Care
Technologies Segment
Dispensing Infusion Respiratory
Leading Brand Names

AVEA®
Pyxis® Alaris® Pulmonetic Systems™
Jaeger®

Critical Care

Pyxis®
Value Proposition
Reduced time to first dose, control cost and diversion

Pyxis D i s p e n s i n g
Why We Win
Leadership
• 7 of every 10 automated medication dispensing machines
are Pyxis® MedStation® systems1
Innovation
• Extensive history of “firsts”, including creating the category
Experience
• Broadest solution portfolio & experienced clinical professionals
to assist with best practices
Customer Service
• #1 ranking in customer satisfaction2
1
HIMSS Analytics, April 2009
2
MD Buyline

Pyxis D i s p e n s i n g
Growth Imperatives
• Continue to innovate in
core business
• Market expansion
• Longer term: Expand
end-to-end medication
management solution for
global hospital pharmacies

Critical Care

Alaris®
Value Proposition
Safe administration of IV medications

Alaris I n f u s i o n
Why We Win
Leadership
• Proven systems with largest installed base – created
“smart pump”
• Comprehensive IV medication safety system
• Global presence
Product differentiation
• Only modular system, multiple modalities on single interface
• Substantial lead in wireless connectivity
• Measurable improvements in practice via continuous quality
improvement (CQI) data

Alaris I n f u s i o n
Growth Imperatives
• Adding new value to large,

installed base
• Expand available market with
new offerings
− Tight glycemic control
− Connectivity with HIT
systems
− Data analytics

Alaris Regulatory Update
History
• February 2007 – Alaris SE pumps in the U.S.
• February 2009 – Amended consent decree, infusion pumps in the U.S.
Key requirements
• Submit corrective action plan
• Independent inspection/certification of infusion pump operations and
recall procedures
Status
• Met all initial requirements of amended consent decree
• Targeting release of Alaris ship hold this month, pending 510K clearance
• Remediate field units following FDA approval of corrective action plan

Critical Care

AVEA®
Pulmonetic Systems™
Jaeger®
Value Proposition
Leading technology to improve outcomes in adult and
neonatal ventilation

Respiratory
Why We Win
Leadership
• Breadth and depth of product offering
• Leading global brands
• Proven clinical outcomes
Customer Support
• Skilled clinical sales force
• Clinical implementation and education teams

Respiratory
Growth Imperatives
• Execute on new product and feature

roadmap, upgrade installed base
• Launch clinically differentiated
consumables internationally
• Further expand ventilator portfolio –
adult/pediatric/neonatal segments

Medical Technologies
and Services Segment
Infection Medical
Prevention Specialties
ChloraPrep® V. Mueller®
MedMined™ Interventional Specialties

Infection Prevention
Why We Win
Leadership, measurable outcomes
• Broadest offering of clinically proven products
− ChloraPrep: Standard of care 2% chlorhexidine-gluconate
antiseptic system
− Skin-prep products: Surgical clippers, prep trays
− MedMined: Information-based infection surveillance
system
Scale
• Largest operating room focused disposables business for
European market

Medical Specialties
Why We Win
Leadership, brand, breadth of offering
• V. Mueller – Broadest offering of handheld
instruments
– Leader in acute care
• Interventional Specialties – Focused on

Interventional Radiologist
– Bone cement
– Chronic drainage
– Standard diagnostic trays

Key Segment Priorities
Critical Care • Maintain, expand U.S. competitive
Technologies position
• Align for global growth
• Demonstrate strength of new
quality system
• R&D, Innovation
Medical Technologies • Drive infection prevention franchises

and Services • Optimize current portfolio
• Leverage international distribution
infrastructure

Operational Priorities

Organized to Execute
• Clear sales focus

– Product sales, marketing aligned with global segments
• New emphasis on alternate sales channels

– Telesales unit
– Channel partners
• Global alignment
– Reduce layers between region management and customers
– Clear segmentation: Defined opportunities, product
requirements
– Selectively targeting emerging markets
• Distinct culture-aligned with CareFusion beliefs

Expand Operating Margins
1 Manufacturing optimization
– Aggressive operational excellence goals
– Optimize capabilities across network
2 Strategic sourcing
– Driving toward fewer suppliers
– Greater volume to drive cost, quality
3 Greater efficiency post-transition service agreements

– $160 million annual spend in transition service agreements
– Longer-term, target 10-20% reduction
4 Realize benefits of March 2009 restructuring

– $110M-$130M in annualized savings by FY11
– Substantial savings begin in FY10

Key Themes
2 Competitive advantage, leadership across all

categories
3 Clear growth drivers

– Innovation
– Expand margins

Ed Borkowski
• Early perspectives
• Spinoff transaction detail
• CareFusion P&L
• Capital strategy
Introduction
• Personal background and experience
- 20 years in healthcare finance
- Formerly CFO of Mylan Inc.
• Why CareFusion?
- The med tech space
- Opportunity to help grow another healthcare company
- Managerial and transactional experience to continue growth

Near-Term Focus
• Learn the business, the organization, the team
• Ensure “stand-up” capabilities in key financial areas
for an independent, publicly traded company
- Audit, tax, treasury, IR, etc.
• Finalize and execute capital structure plans
- Launch and place debt financings
• Continue to educate shareholders and market the
CFN equity story

Spin-off Transaction Plans
• CAH will spin off at least 80% of CFN outstanding shares through a
pro-rata distribution to CAH shareholders
– Cardinal Health required to dispose of remaining stake in CareFusion
within 5 years
• CFN will obtain a bridge loan for $1.4 billion to finance cash
distribution to CAH
• Immediately, or as market conditions permit, CFN will issue $1.4
billion in debt financing to replace bridge loan
• Arrange $500m revolving bank credit facility as liquidity backstop
• Target Summer 2009 for completion
– Contingent upon SEC declaring the Form 10 effective, IRS ruling on
tax-free nature of the transaction, obtaining investment grade credit
ratings and completion of necessary financing
– All are progressing

Prospective Credit Ratings
• A criteria for the spinoff is assignment of investment
grade ratings from leading credit rating agencies
• Cardinal Health meets regularly with the credit rating
agencies, and they are familiar with the prospective
CareFusion businesses
• The agencies publicly announce their ratings on specific
financings when they are launched
• We are confident that CareFusion’s debt offerings will be
assigned investment grade ratings

CFN Historical Pro Forma P&L
CareFusion Pro Forma Financials As Reported
FY06- FY08 Form 10 Pro Formas
2006 2007 2008
($ Millions, except per share amounts)
Revenue $ 2,322 $ 2,659 $ 3,771

Gross Margin 1,132 1,311 1,789
Operating Earnings 284 279 537
Interest Expense and Other, net (41) (33) (119)
Net Earnings 177 196 319
ETR 27.4% 20.4% 23.8%
EPS (Diluted) (1) $ 0.39 $ 0.43 $ 0.70
Items of Interest
($ Millions) 2006 2007 2008
Restructuring, Acquisition Integration Charges and
IPR&D (2) $ 23 $ 107 $ 53
Additional interest expense if consistent w/FY08 ($1.4B
at 8.5%) (3) $ (74) $ (76) $ -
(1) EPS for 2006 and 2007 is based on Form 10 Pro Forma amounts for the respective years
and assumes ~450M diluted shares outstanding
(2) Source: CFN Form 10 Amendment 1
(3) CFN Calculations
Near-Term Expectations
• FY09 CMP segment profit goal: -7% to -11%
– Translates to approximately the same range for CFN pro forma
operating earnings excluding stand-up, restructuring, merger integration
costs
• FY10:
− Revenue: continued impact of capital spend slowdown
− Operating expenses excluding stand-up, merger integration and
restructuring costs: $50M to $70M higher net of restructuring benefit
− Incremental “public company” costs
− Incentive compensation
− Incremental Innovation and R&D spend
− Stand up, merger integration and restructuring costs of approximately
$80M - $100M
− Anticipated tax rate: 30% to 32%

Longer-Term Expectations
Î FY10 becomes the new baseline for comparability
going forward
Beyond FY10:
• Revenue growth: mid-single digits
• R&D: growing faster than revenue
• Earnings:
– Operating earnings grow 11% to 15%
• Anticipated Tax rate: 30% to 32%

Capital and Financial Strategy
• We are committed to maintaining investment grade credit
ratings and prudent financial management practices
• Earnings will be retained to finance growth
– Research and development as % of revenue will grow
– Focus on product and technology acquisitions
• Opportunistic debt pay-down planned over the FY10-12
period
• Do not anticipate paying any cash dividends or initiating
any net share repurchase programs

Disciplined Approach to Capital
Management
• Primary Objective: Maintain financial strength and
flexibility
– Enable investment in the business
– Opportunistic acquisition
– Reduce debt balances
• Maximizing earnings and cash flow are key
– Management incentives focused upon growth in both
– Expect prudent control over capital expenditures
– Reduce working capital over time

Key Themes
Competitive advantage, leadership across all

2 categories
Clear growth drivers

3 – Innovation
– Expand margins

Q&A

Analyst and Investor Day Presentation PDF

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Analyst and Investor Day Presentation PDF

Uploaded by

Copyright:

Available Formats

Cardinal Health, Inc.

Analyst / Investor Day Meetings

Timeline target: Summer 2009

8:00 a.m. Welcome and agenda

8:15 a.m. Spinoff financial details

8:30 a.m. New Cardinal Health

12:00 p.m. Lunch and healthcare reform update

1:15 p.m. CareFusion Corporation

4:30 p.m. CareFusion product demonstrations with management

5:30 p.m. Adjourn

• CareFusion and New Cardinal Health financial crosswalks

• Spinoff costs and negative synergies

New Cardinal Health CareFusion

Equity 6 Cardinal 2 CareFusion

Cardinal CareFusion Bridge Loan

1Overview assumes that bridge is drawn down to fund distribution at spin-off

Gross margin ($M) 1,507 8 (165) 1,350

SG&A ($M) 871 8 (71) 809

Operating earnings 460 (0.4) (89) 370

Royalty (income) (194) 194 -

Gross margin ($M) 4,183 (1,357) 2,826

SG&A ($M) 2,584 (867) 1,717

Diluted EPS from $2.44 $(0.83) $0.14 $(0.05) $1.702

1Incremental cost to FY09 pro forma

Sector nCAH CFN

Pharma Critical Care

• New Cardinal Health

• Critical role in healthcare

• Three pillar strategy for the future

• What to expect going forward

Balanced Balanced business model focused on delivering

Cost-effective Well positioned to deliver healthcare solutions in most

Financial Strong balance sheet and cash flows, making necessary

Experienced team with diverse healthcare backgrounds

Operating earnings* ~$1.5B

Countries with direct operations 11

• Capital deployment strategy

• Streamlined portfolio management

George Barrett Chairman and CEO

• New Cardinal Health

• Critical role in healthcare

• Three pillar strategy for the future

• What to expect going forward

Health Reform Priorities Role of New Cardinal Health

• Slow growth rate of costs • Efficient, low cost partner

Increasing number • Expand coverage through • Continued/increased demand

Fragmented • Continuum of care • Necessitates broad

• Pay for performance and • Heightened focus on

Acute Care Ambulatory Care

• Most efficient link to end- • Cost-effective solutions

• Drive usage of cost • Improved economics

Balanced portfolio of products and services playing a critical role

1 Numbers are unaudited estimates of FY10 segment profit contribution.

• New Cardinal Health

• Critical role in healthcare

• Three pillar strategy for the future

• What to expect going forward

• Create a lean, disciplined and agile organization

9 • Delivering FY09 HSCS financial goals

9– Controlled drug licenses restored

9– Strengthen relationship with retail independents

9 • Elevate focus on and commitment to Medical

• Major initiatives underway