Pharmaceutical Distribution and Pr ovider Services U.S. PHARMACEUTICAL SALES HAVE GROWN AT A COMPOUND ANNUAL RATE OF  OVER THE PAST DECADE, CURRENTLY APPROACHING $135 BILLION About one out of every six pharmaceutical products dispensed to U.S. patients  has traveled through Cardinal’s highly efficient, nationwide network. Every day, Cardinal Health distributes about one million pharmaceutical products to independent and retail chain pharmacies, hospitals, surgery centers, physicians’ offices and long-term care centers nationwide. In fact, about one out of every six pharmaceutical products dispensed to U.S. patients has traveled through Cardinal’s highly efficient, nationwide network of 25 distribution centers.  The market for pharmaceuticals is large and growing rapidly. U.S. pharmaceutical sales have grown at a com- pound annual rate of 13% over the past decade, cur rently approaching $135 billion. An aging population, develop - ment of new drug therapies and increased coverage of pharmaceuticals by health plans all contribute to a favor - able outlook for continued strong pharmaceutical growth. Estimates for the year 2005 show the U.S. phar maceuti- cal market nearly doubling to appr oximately $260 billion.  Cardinal Health provides manufacturers with highly efficient and economical distribution services essential  for these important products. Cardinal handles all of  the logistics, inventory and receivables management,  and administrative activities involved in delivering  pharmaceutical products to more than 26,000 pharmacy  locations every day. For its pharmacy customers,  Cardinal consolidates orders for products, potentially from hundreds of manufacturers, into pharmacy-specific deliveries of the right products to the right place at  the right time. Cardinal also provides a broad range of marketing, merchandising and information support  services for its manufacturer  and provider customers. This group includes three additional businesses,  complementary to distribution, for pharmacy-providers. Medicine Shoppe International is the country’s leading franchiser of independent retail pharmacies with nearly 1,300 of these apothecary-style pharmacies in the United States and nine other countries. Medicine Shoppe of fers  a successful, alternative business format to retail pharma- cists who desire to own their own store. For hospitals, Owen Healthcare offers pharmacy and materials-manage- ment services that help customers control costs while enhancing the quality of patient care. The recently formed Cardinal Health Staffing Network assists Cardinal’s retail and hospital pharmacy customers with their staffing needs as they face a growing shortage of pharmacy professionals. Through these businesses, Cardinal Health has become one of the largest employers of pharmacists in the nation with more than 2,200 pharmacists on staff. Cardinal Health, Inc. Annual Report 2000 9 Cardinal’s operations include full-line drug distribution as well as several specialty pharmaceutical distribution businesses that address specific customer or manufacturer requirements. These businesses include the nation’s lead- ing pharmaceutical repackaging operation (currently uti- lized by six of the 10 lar gest retail chains in the country); a leading blood plasma and specialty dr ug distributor; and a company that provides full-service, third-party logistics to manufacturers. 