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Cardinal Health Expands Portfolio with Acquisitions of GI Alliance and Advanced Diabetes Supply Group


**Cardinal Health Expands Portfolio with Acquisitions of GI Alliance and Advanced Diabetes Supply Group**

*October 2023*

Cardinal Health, a global leader in healthcare services and products, has made strategic moves to strengthen its portfolio by acquiring two prominent healthcare organizations: GI Alliance and Advanced Diabetes Supply Group. These acquisitions are expected to enhance Cardinal Health’s capabilities in specialized healthcare services and expand its reach into key therapeutic areas, including gastroenterology and diabetes care.

### Overview of Cardinal Health

Cardinal Health is a Fortune 500 company that provides healthcare services, medical products, and pharmaceutical distribution to hospitals, pharmacies, and other healthcare providers. With a focus on improving the quality of care and reducing costs, the company has been a major player in the healthcare supply chain for decades. Cardinal Health has a strong presence in both the pharmaceutical and medical segments, offering a wide range of products and services that support patient care across the continuum.

### Acquisition of GI Alliance

GI Alliance is the largest gastroenterology practice in the United States, specializing in the diagnosis and treatment of gastrointestinal (GI) disorders. With over 700 gastroenterologists and more than 300 locations across the country, GI Alliance has built a reputation for providing high-quality, patient-centered care in the field of digestive health. The organization offers services ranging from routine colonoscopies to advanced treatments for conditions such as Crohn’s disease, ulcerative colitis, and irritable bowel syndrome (IBS).

By acquiring GI Alliance, Cardinal Health is positioning itself to capitalize on the growing demand for specialized GI services. Gastrointestinal disorders are becoming increasingly prevalent, driven by factors such as aging populations, dietary changes, and rising rates of obesity. The acquisition allows Cardinal Health to tap into this expanding market and offer a more comprehensive suite of services to healthcare providers and patients.

**Strategic Benefits of the GI Alliance Acquisition:**
1. **Expanded Specialty Care:** The acquisition strengthens Cardinal Health’s presence in the specialty care market, particularly in the high-demand area of gastroenterology.
2. **Enhanced Patient Outcomes:** By integrating GI Alliance’s expertise with Cardinal Health’s existing infrastructure, the company can offer more coordinated care, leading to better patient outcomes.
3. **Increased Market Share:** GI Alliance’s extensive network of gastroenterologists and clinics provides Cardinal Health with a significant foothold in the U.S. GI care market.

### Acquisition of Advanced Diabetes Supply Group

Advanced Diabetes Supply Group (ADS) is a leading provider of diabetes management products, including continuous glucose monitors (CGMs), insulin pumps, and other diabetes-related supplies. ADS has built a strong reputation for delivering high-quality products and services to patients with diabetes, a chronic condition that affects millions of people worldwide.

The acquisition of ADS aligns with Cardinal Health’s strategy to expand its presence in chronic disease management, particularly in the rapidly growing diabetes care market. Diabetes is one of the most prevalent chronic conditions globally, with an estimated 463 million adults living with the disease, according to the International Diabetes Federation. The demand for diabetes management products and services is expected to continue rising as the number of people diagnosed with diabetes increases.

**Strategic Benefits of the ADS Acquisition:**
1. **Broader Product Portfolio:** The acquisition of ADS allows Cardinal Health to offer a more comprehensive range of diabetes management products, including cutting-edge technologies like CGMs and insulin pumps.
2. **Improved Patient Access:** ADS’s direct-to-consumer model ensures that patients have easier access to the diabetes supplies they need, improving adherence to treatment plans and overall health outcomes.
3. **Synergies with Existing Operations:** The acquisition complements Cardinal Health’s existing medical and pharmaceutical distribution services, enabling the company to offer a more integrated solution for diabetes care.

### Strategic Implications for Cardinal Health

The acquisitions of GI Alliance and Advanced Diabetes Supply Group are part of Cardinal Health’s broader strategy to diversify its portfolio and expand its presence in high-growth therapeutic areas. Both gastroenterology and diabetes care represent significant opportunities for growth, given the increasing prevalence of these conditions and the rising demand for specialized healthcare services.

**Key Strategic Implications:**
1. **Diversification of Revenue Streams:** By entering new therapeutic areas, Cardinal Health is diversifying its revenue streams and reducing its reliance on traditional pharmaceutical distribution, which has faced pricing pressures in recent years.
2. **Expansion of Specialty Care Services:** The acquisitions allow Cardinal Health to offer a more comprehensive range of specialty care services, positioning the company as a leader in both gastroenterology and diabetes care.
3. **Enhanced Competitive Position:** The acquisitions strengthen Cardinal Health’s competitive position in the healthcare market, enabling it to better compete with other healthcare giants that are also expanding their presence in specialty care and chronic disease management.

### Future Outlook

Looking ahead, the acquisitions of GI Alliance and Advanced Diabetes Supply Group are expected to drive significant growth for Cardinal Health. The company is well-positioned to capitalize on the increasing demand for specialized healthcare services, particularly in the areas of gastroenterology and