Core Insights - The healthcare industry is transitioning towards decentralized, patient-centric care models, with home infusion and specialty pharmacy services emerging as key growth areas [1] - BrightSpring Health Services (BTSG) and Option Care Health (OPCH) are two notable players capitalizing on the demand for cost-effective, high-quality treatment options [1] BrightSpring Health Services (BTSG) - BTSG achieved a remarkable 33% year-over-year growth in its infusion and specialty pharmacy segment in Q1 2025, driven by a 20% increase in prescription volumes and the launch of 127 limited distribution drugs [2][6] - The company reported operational excellence with a dispense accuracy of 99.999%, 95% infusion satisfaction, and over 90% home health satisfaction [7] - Adjusted EBITDA improved by 28% in Q1, with Pharmacy Solutions contributing 31% growth, supported by rising script volumes and operational initiatives [8] - Management raised the 2025 revenue guidance to between $12.0 billion and $12.5 billion, with adjusted EBITDA projected to be between $570 million and $585 million, indicating a potential growth of up to 27% [9][10] - The Zacks Consensus Estimate suggests an 82.1% improvement in BTSG's 2025 earnings per share (EPS) compared to 2024 [14] Option Care Health (OPCH) - OPCH reported a 16% year-over-year revenue growth in Q1, with mid-teens growth in acute therapies and high-teens growth in chronic, rare, and orphan therapies [11] - The company is leveraging AI and robotic process automation (RPA) to enhance operational efficiency and margin expansion [12] - Adjusted EBITDA improved by 13.7% year-over-year, leading to an 8.4% EBITDA margin, while the company repurchased $100 million in stock in Q1 [13] - OPCH's full-year 2025 revenue guidance is set between $5.4 billion and $5.6 billion, with EBITDA projected at $455 million to $470 million [13] - The Zacks Consensus Estimate indicates a 36.6% improvement in OPCH's 2025 EPS over the previous fiscal year [16] Comparative Analysis - BTSG is trading at a forward price-to-sales ratio of 0.31X, above its one-year median of 0.25X, while OPCH is at 0.90X, below its 5-year median of 0.97X, indicating that BTSG is more attractively valued relative to its growth [17] - Recommendations suggest buying BTSG due to its faster revenue and EBITDA growth, while holding OPCH as it makes strategic advancements [18]

Core Viewpoint - Option Care Health Inc. is set to release its second quarter results for the period ending June 30, 2025, on July 30, 2025, before market opening, followed by a conference call to discuss the results [1]. Group 1: Company Overview - Option Care Health is the largest independent provider of home and alternate site infusion services in the United States [3]. - The company employs over 8,000 team members, including more than 5,000 clinicians, dedicated to improving care standards for patients with acute and chronic conditions across all 50 states [3]. - Option Care Health aims to enhance the infusion care experience through its clinical leadership, expertise, and national scale [3]. Group 2: Conference Call Details - Participants can pre-register for the conference call through a provided link and access it via a live audio webcast available on the company's investor relations website [2]. - A replay of the conference call will be available shortly after its completion and will remain accessible for approximately 90 days [2].

Summary of Option Care Health (OPCH) FY Conference Call - June 09, 2025 Company Overview - **Company**: Option Care Health (OPCH) - **Industry**: Home Infusion Services Key Points and Arguments Market Dynamics - The acute side of the business is characterized as a low single-digit growth market, while the chronic side is experiencing high single-digit to low double-digit growth, with chronic growth being in the low teens [4][5][8] - The company raised the bottom end of its full-year guidance due to strong first-quarter performance, indicating confidence in market resilience despite uncertainties [3] Growth Drivers - The company is well-positioned to benefit from drug innovations, particularly in the infusion and injectable product pipeline, which requires healthcare professional oversight [10][12] - The transition towards lower-cost settings of care is a significant driver for growth in both acute and chronic markets [5][19] - The company has invested in facilities, technology, and personnel to enhance its service delivery and capitalize on market opportunities [20][21] Competitive Advantage - Option Care Health has a robust nursing network and pharmacy infrastructure, allowing it to respond effectively to patient needs and market demands [23][25] - The company has maintained a competitive edge by being purpose-built for home infusion services, which has allowed it to navigate challenges such as bag shortages and competitive exits from the market [26][28] Financial Performance - The company reported a revenue CAGR of 13% over the past five years, outperforming market growth [20] - Despite headwinds from the STELARA product, the company has managed to grow and maintain profitability through strategic negotiations and operational efficiencies [47][49] Future Outlook - The company anticipates continued growth in the chronic segment, driven by durable demand in chronic inflammatory diseases and new product introductions [36][40] - There is potential for growth in oncology, particularly with PD-1 therapies, as the company expands its capabilities in this area [42][44] - The management is cautious about the impact of policy changes, such as MFN and tariffs, but believes that their business model will allow them to adapt and negotiate better terms with payers [54][56] Risks and Considerations - The company faces uncertainties related to market dynamics, competitive pressures, and regulatory changes that could impact pricing and reimbursement [2][54] - The management is focused on navigating these challenges while continuing to prioritize patient care and operational excellence [21][49] Additional Important Content - The company has established over 800 payer relationships and is in-network with most major payers, which simplifies access for patients and enhances its competitive position [19] - The management emphasized the importance of local responsiveness in healthcare, leveraging their national scale to provide tailored services [19][21] - The evolving nature of the product portfolio, including the shift from IV to subcutaneous administration, is being closely monitored to ensure effective patient support [13][15]

Summary of the Conference Call Company Overview - The conference call featured Option Care Health, a national provider of infusion services, with key speakers including CEO John Rademacher and CFO Mike Shapiro [1][2] Financial Performance - The company reported a strong first quarter with revenue growth of over 16% year-over-year [5] - Gross profit increased by 10.3%, and adjusted EBITDA rose by 13.7% [6] - Diluted EPS grew by 14.3%, supported by a share repurchase program that bought back $100 million in shares during the quarter [6] - The company raised its guidance for the year based on strong performance [7] Market Position and Strategy - Option Care Health has a national presence, reaching approximately 96% of the U.S. population, which allows it to capitalize on market changes and competitive dynamics [4][5] - The company operates over 170 locations and more than 90 pharmacies, providing both home and clinic-based infusion services [10] - The infusion services market is fragmented with over 800 providers, but Option Care Health claims a unique position due to its scale and breadth of product offerings [12][13] Product Portfolio - The revenue mix consists of approximately 75% from chronic therapies and 25% from acute therapies, with chronic therapies being higher-priced branded products [15][16] - The company has over 800 payer relationships and 1,400 contracts, with only 12% of revenue coming from government payers, minimizing exposure to government reimbursement risks [17] Supply Chain and Operational Efficiency - The company is focused on supply chain optimization and has a nimble team to mitigate risks associated with market changes, such as drug shortages [9] - Investments in infrastructure include state-of-the-art pharmacies and infusion clinics to enhance service quality and capacity [7][28] Future Growth Opportunities - The company sees opportunities for growth in neurological disorders and oncology, particularly with products like PD-1 inhibitors [30][31] - Continued investment in technology, including a partnership with Palantir for AI and machine learning, aims to improve operational efficiency and patient outcomes [31][32] Shareholder Value - The company emphasizes returning value to shareholders through share repurchase programs and strategic M&A activities [6][33] - Consistent cash flow generation is expected to support ongoing investments and shareholder-friendly actions [33] Conclusion - Option Care Health is well-positioned in the infusion services market, with a strong financial performance, a diverse product portfolio, and a focus on operational efficiency and growth opportunities [22][33]

Summary of Option Care Health (OPCH) Conference Call Company Overview - **Company**: Option Care Health (OPCH) - **Industry**: Home Infusion Services - **Event**: 2025 Conference on May 13, 2025 Key Points Strong Performance and Growth Expectations - The company reported a strong first quarter, exceeding internal performance measures despite challenges such as bag shortages and competitive exits [2][3] - Excluding the impact of Stelara, the company anticipates approximately 20% EBITDA growth for the year [4][6] Drivers of Growth - Growth is expected to come from acute therapies and capitalizing on competitive exits in the market [6][7] - The company is seeing growth not only in exit markets but also in other areas due to reliable partnerships with hospitals and health systems [7][8] - The focus on high-quality care at lower costs positions the company favorably with payers, especially in managing total care costs [9][10] Managed Care Relationships - The company is actively engaging with managed care plans to facilitate patient transitions from higher-cost inpatient settings to home or infusion suites [9][10] - There is an increasing interest from payers in utilizing home infusion services to manage costs effectively [13] Investment in Infrastructure - Annual capital expenditures range from $30 million to $40 million, focusing on expanding pharmacy infrastructure and infusion suite capabilities [15][16] - The company operates over 750 infusion chairs across the U.S. and is investing in advanced care practitioner models to manage more complex patients [16][17] Therapeutic Focus - The company is expanding into areas such as oncology and complex conditions like Alzheimer's, leveraging advanced practitioner models [19][20] - There is a focus on rare and orphan products, with ongoing efforts to partner with manufacturers for new product launches [24][25] Biosimilars and Market Dynamics - The company is preparing for the impact of biosimilars entering the market, particularly concerning Stelara, but emphasizes that most patients served require intravenous administration rather than self-injection [27][28] - The company retains a majority of its Stelara patients, and while profitability is affected, it remains a viable therapy [29] Executive Order and Drug Pricing - The recent executive order aimed at reducing drug costs presents uncertainties, but the company is monitoring its potential impacts on pricing and reimbursement [36][37] - The company operates with a diverse pricing strategy, with less than 50% of revenue tied to contracts based on average selling price (ASP) [38][39] Free Cash Flow and Capital Deployment - The company generated over $250 million in free cash flow last year and expects to maintain similar levels this year [49][50] - Capital deployment strategies include mergers and acquisitions, as well as share repurchases, with significant investments made in both areas recently [51][52] Conclusion - Option Care Health is well-positioned for continued growth through strategic investments, strong managed care relationships, and a focus on high-quality, cost-effective care solutions. The company is actively navigating market dynamics, including the introduction of biosimilars and regulatory changes, while maintaining a robust capital deployment strategy.

Core Viewpoint - Growth investors are increasingly focusing on stocks with above-average financial growth, and Option Care (OPCH) is highlighted as a strong candidate due to its favorable growth metrics and Zacks Rank [2][10] Group 1: Earnings Growth - Option Care has a historical EPS growth rate of 75.7%, with projected EPS growth of 35.2% for the current year, significantly outperforming the industry average of 14.9% [5][4] Group 2: Asset Utilization - The company has an asset utilization ratio (sales-to-total-assets ratio) of 1.54, indicating it generates $1.54 in sales for every dollar in assets, compared to the industry average of 0.81, showcasing superior efficiency [6] Group 3: Sales Growth - Option Care's sales are expected to grow by 10.1% this year, which is higher than the industry average growth of 5.2%, indicating strong sales performance [7] Group 4: Earnings Estimate Revisions - The current-year earnings estimates for Option Care have been revised upward by 0.8% over the past month, reflecting a positive trend that correlates with potential stock price movements [8] Group 5: Overall Positioning - With a Growth Score of A and a Zacks Rank of 2, Option Care is well-positioned for outperformance in the growth investing space, making it an attractive option for growth investors [10]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-Q (Mark One) ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2025 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number: 001-11993 OPTION CARE HEALTH, INC. (Exact name of registrant as specified in its charter) Delaware 05-0489664 3000 Lakeside Dr. Sui ...

Financial Data and Key Metrics Changes - Revenue grew by 16% year-over-year in the first quarter, with adjusted EBITDA increasing by 13.7% [5][16][17] - Adjusted earnings per share reached $0.40, reflecting a 14.3% increase compared to the previous year [16] - Gross profit was $263 million, up over 10% from the first quarter last year [14] Business Line Data and Key Metrics Changes - Acute Therapies experienced mid-teens growth, while Chronic Therapies grew in the high teens, with notable performance in rare and orphan therapies [5][13] - The company reported a strong performance in its infusion clinics, conducting over one-third of nursing visits in these centers [10] Market Data and Key Metrics Changes - The company is actively working with innovative health plans to support site of care initiatives, which aligns with their goals to reduce total cost of care [7][45] - The company has opened a new compounding pharmacy and additional infusion clinics, enhancing its service capacity [8][10] Company Strategy and Development Direction - The company is focused on building a unique care model to support patient needs, emphasizing investments in technology and nursing capabilities [5][8] - The acquisition of Intramed Plus is expected to enhance the company's infusion clinic footprint and operational performance [9][10] - The company is monitoring macroeconomic conditions and potential tariff impacts, maintaining a cautious approach to future capital deployment [11][12][96] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the first quarter's performance and increased the lower end of the full-year adjusted EBITDA guidance [12][17] - There is a recognition of the uncertainty surrounding tariffs and their potential impact on costs, but the company does not expect significant disruptions [11][78] Other Important Information - The company has invested significantly in technology, including AI and robotic process automation, to improve operational efficiency [8][55] - The company is actively managing its supply chain to mitigate potential tariff impacts, with less than 10% of medical supplies sourced from China [91][92] Q&A Session Summary Question: Concerns about underlying fundamentals for the rest of the year - Management indicated a cautious approach historically and noted that the first quarter can be unpredictable due to various dynamics [20][22] Question: Impact of MAPD changes on chronic business - Management confirmed strong growth in both acute and chronic therapies, anticipating benefits from changes in out-of-pocket costs [25][26] Question: Mechanics of tariff impacts on pricing - Management explained that drug prices and reimbursement are linked, and while there may be some lag, they do not foresee severe disruptions [30][76] Question: Changes in payer conversations and infusion benefits - Management highlighted deeper partnerships with payers, focusing on total cost of care and patient transitions from hospitals [43][45] Question: Sustainability of acute growth - Management acknowledged that while mid-teens growth is not expected to be the norm, they are well-positioned to maintain strong performance [60][102] Question: Acquisition strategy amidst uncertainty - Management remains active in pursuing acquisitions, focusing on smaller, complementary deals while being cautious due to the macro environment [96][97]

Group 1 - Option Care reported quarterly earnings of $0.40 per share, exceeding the Zacks Consensus Estimate of $0.36 per share, and up from $0.26 per share a year ago, representing an earnings surprise of 11.11% [1] - The company achieved revenues of $1.33 billion for the quarter ended March 2025, surpassing the Zacks Consensus Estimate by 5.38%, compared to $1.15 billion in the same quarter last year [2] - Option Care has consistently outperformed consensus EPS and revenue estimates over the last four quarters [2] Group 2 - Since the beginning of the year, Option Care shares have increased by approximately 42.1%, while the S&P 500 has declined by 6% [3] - The company's future stock performance will largely depend on management's commentary during the earnings call and the outlook for earnings estimates [4][6] - The current consensus EPS estimate for the upcoming quarter is $0.42 on revenues of $1.34 billion, and for the current fiscal year, it is $1.68 on revenues of $5.44 billion [7] Group 3 - The Medical - Outpatient and Home Healthcare industry, to which Option Care belongs, is currently ranked in the top 21% of over 250 Zacks industries, indicating a favorable outlook [8] - Another company in the same industry, Aveanna Healthcare, is expected to report break-even quarterly earnings per share, reflecting a year-over-year change of +100% [9]

Financial Data and Key Metrics Changes - Revenue growth of 16% year-over-year in the first quarter, with mid-teens growth in Acute Therapies and high-teens growth in Chronic Therapies [5][14] - Adjusted EBITDA of $111.8 million grew 13.7% year-over-year, representing 8.4% of net revenue [16] - Adjusted earnings per share of $0.40 grew 14.3% year-over-year [16] Business Line Data and Key Metrics Changes - Acute Therapies experienced mid-teens growth, attributed to improved IV bag supply and market dynamics [5][14] - Chronic Therapies showed high-teens growth, particularly in rare and orphan therapies [5][15] - Gross profit of $263 million grew over 10% compared to the first quarter last year, benefiting from the therapy mix [15] Market Data and Key Metrics Changes - The company continues to deepen partnerships with health plans, addressing increased medical loss ratios and higher utilization of care [8][47] - The company is actively working with innovative health plans to support site of care initiatives, aiming to reduce total cost of care [8][47] Company Strategy and Development Direction - The company is focused on building a unique care model to support patient needs, with significant investments in technology and nursing capabilities [5][9] - Continued investment in advanced technology, including robotic process automation and AI, to improve operational efficiency [9][10] - The acquisition of Intramed Plus is expected to enhance the company's infusion clinic footprint and operational performance [10][11] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the first quarter results and the company's ability to navigate macroeconomic uncertainties, including potential tariff impacts [12][14] - The lower end of the full-year adjusted EBITDA guidance was increased due to strong first-quarter performance, while the top end remains unchanged due to market uncertainty [14][18] Other Important Information - The company repurchased $100 million of stock during the quarter, reflecting confidence in its balance sheet [11][17] - The company spends approximately $100 million on medical supplies, with less than 10% sourced from China, mitigating potential tariff impacts [95][96] Q&A Session Summary Question: Concerns about underlying fundamentals for the rest of the year - Management indicated a cautious approach, emphasizing the need to monitor market dynamics and not extrapolate first-quarter results too aggressively [20][22] Question: Impact of MAPD changes on chronic business - Management noted that while acute growth was strong, they expect some benefits from changes in out-of-pocket costs for chronic therapies in the latter half of the year [25][26] Question: Mechanics of tariff impacts on pricing - Management explained that while tariffs could increase drug prices, their procurement contracts provide some flexibility to manage costs [30][31] Question: Changes in payer conversations regarding infusion benefits - Management highlighted that they are increasingly seen as a valuable partner in managing total cost of care, with a focus on transitioning patients from hospitals [45][47] Question: Acquisition strategy amidst economic uncertainty - Management remains active in pursuing acquisitions, focusing on smaller, complementary deals while being cautious due to the macro environment [99][100]